Our most recent blog posting addressed allegations made on behalf of investors in connection with a proceeding based in State District Court, Brown County, Texas. This blog follows up on that posting; it discusses the “Letter Opinion” the trial court issued after the trial came to a conclusion. Additionally, it provides a brief overview of the Judgment the trial court entered, together with the Findings Of Fact And Conclusions Of Law the trial court executed.

Trial Court “Letter Opinion”

Through the issuance of its “Letter Opinion,” the trial court made an assortment of findings, to include the following:

• “The court finds that the representations made by the Defendant . . . were made recklessly because the evidence shows that he made them without any knowledge of its (sic) truth and made them as positive assertions of fact when he did not have sufficient information or basis to support the representations and when he did not in fact know whether the representations he was making were true or not”;

• “The court finds that [the] Defendant . . . made the representations with the intent that the Plaintiffs rely on them and the Plaintiffs in fact did so to their damage”; and

• “The court finds that the Defendant is also liable to . . . [certain parties] for damages as provided by the Texas Securities Act provisions specifically pled . . . .”

Judgment Entered By Trial Court

Several months later, the trial court entered a Judgment against the Defendant. Excerpts of that Judgment are set forth below.

• “After hearing the evidence and arguments of counsel, the Court is of the opinion that the Plaintiffs are entitled to recover damages from the Defendant, and hereby issues this Judgment . . . .”

As part of its Judgment, the trial court ordered that the Plaintiffs “have and recover” their respective “actual damages,” along with “reasonable attorney fees,” pre-judgment interest, post-judgment interest, and “[a]ll costs of court spent or incurred in this cause by the Plaintiffs.”

Several weeks after it entered a Judgment on behalf of the Plaintiffs, the trial court issued its Findings Of Fact And Conclusions Of Law, which spans seven pages. The factual findings that are set forth therein include the following:

• The Defendant “failed to disclose that he had been the subject of a 2001 Texas State Securities Board Cease and Desist Order, which had been issued in connection with his sale of purported ‘low-risk, high-return trading programs,’ wherein he was prohibited from selling unregistered securities in the absence of an exemption . . . .”;

• The Defendant “failed to disclose that TDI issued an Emergency Cease and Desist Order against PCI on November 6, 2006, wherein it found that PCI was then engaged in the unauthorized business of insurance in violation of Texas law . . . .”;

• The Defendant “failed to disclose that the State of Florida had successfully initiated a receivership proceeding against PCI . . . .”; and

• The Defendant “failed to disclose the level of commissions he expected to receive.”

With respect to its Conclusions Of Law, the trial court made a series of determinations, to include the following:

• “In Texas, breach of contract provides for an award of attorney fees. Tex. Civ. Prac. & Rem. Code § 38.001(8)”; and

• “Texas securities law allows for the recovery of attorney fees in a case such as this, where it is shown that the award of attorney fees would be ‘equitable.’ Section 33D(7), Texas Securities Act. Such award of attorney fees shall also be reasonable and necessary.”

Appellate Challenges Raised By Defendant

To place things in perspective, readers must understand that the Defendant is adamant in his denial of wrongdoing. He generally disagrees with the findings and determinations that have been made by the trial court, and he rejects numerous allegations that have been made on behalf of the Plaintiffs. Consequently, the Defendant is vigorously pursuing an appeal of this matter. Viewed in that light, it is readily apparent that this case has not yet come to a conclusion. To that end, readers should refrain from making any assessments pertaining to any issues associated with this case. Framed in concise terms, appellate courts have frequently exercised their authority so as to, among other things, modify or reverse the decisions of a trial court.

Cautionary Remarks: Incomplete Overview & Analysis

Like its predecessor, this blog makes no attempt to quote from materials referenced above in a thorough or expansive manner. To the contrary, it features limited segments of those documents. Consequently, readers should not rely on this blog posting as part of an attempt to formulate an understanding of the legal or factual aspects of the Brown County case, or the characteristics and attributes of the underlying parties. Among other things, the segments of the documents that are referenced or reflected herein are too incomplete to form a meaningful analysis. Moreover, many of the segments have been modified or edited so as to provide for a more compact, abbreviated blog posting. The names of the parties have been omitted.*

If you were induced to invest your hard-earned savings pursuant to a misleading sales presentation, you may be in a position to obtain a recovery. State and federal securities law principles operate so as to protect your interests. Contact Chris Bebel to discuss your rights. Mr. Bebel is a former attorney for the U.S. Securities and Exchange Commission; and he previously served as an Assistant United States Attorney. During his tenure at the U.S. Attorney’s Office, Mr. Bebel focused on securities fraud cases. Mr. Bebel’s work in the securities fraud area spans roughly three decades. He works closely with Bradley Ellison, a learned paralegal who previously served as a U. S. Air Force master sergeant. Mr. Ellison is currently pursuing his third master’s degree. Mr. Bebel, Mr. Ellison, and other Tefteller Law, PLLC personnel customarily work as a team to represent investors who have suffered losses. Caveat: Throughout his career in private practice, Mr. Bebel has routinely declined cases presented by investors seeking legal representation. Neither Mr. Bebel nor any other reputable attorney can promise you that your case will be accepted. No fees will be assessed in connection with an evaluation of your case.

Mr. Bebel has, for many years, represented investors situated throughout the country, including investors residing in the following states: Colorado, Arkansas, Oklahoma, Indiana, Minnesota, California, Texas, Kansas, Florida, Iowa, New York, and New Jersey.

Mr. Bebel has provided instructive presentations addressing an array of securities industry topics to lawyers and securities industry professionals in the following cities: Fort Myers, FL; Jacksonville, FL; Colorado Springs, CO; San Diego, CA; New York, NY; Dallas, TX; Houston, TX; San Antonio, TX; Toronto, Ontario; and Tucson, AZ.

Mr. Bebel has been published through the following: Texas Tech Law Review, Texas Tech University, Lubbock, TX (voted Best Article of the Year by Texas Tech Law Review editors); Houston College of Law (f/k/a South Texas College of Law), Houston, TX; the State Bar of Texas, Austin, TX; Public Investors Arbitration Bar Association, Oklahoma City, OK; Practicing Law Institute, New York, NY; Louisiana Law Review, Louisiana State University, Baton Rouge, LA; and West Virginia Law Review, West Virginia University, Morgantown, WV.

Mr. Bebel has served as a visiting lecturer on securities law principles at the following institutions: Texas Tech University School of Law, Lubbock, TX; Baylor University School of Law, Waco, TX; University of Houston Law Center, Houston, TX; the FBI Academy, Quantico, VA; and Mitchell Hamline School of Law, St. Paul, MN.

* Based on the same considerations, it is likewise imperative that readers refrain from relying on the blog postings that relate to the Lubbock County case in connection with an attempt to develop or formulate an understanding or assessment of that proceeding or the participants thereto.