Abrams et al v. Tuberville et al
Filing
219
OPINION. Signed by Honorable Judge Myron H. Thompson on 12/12/2013. (jg, ) (Main Document 219 replaced on 12/12/2013 to reflect the opinion) (jg, ).
IN THE UNITED STATES DISTRICT COURT FOR THE MIDDLE
DISTRICT OF ALABAMA, NORTHERN DIVISION
JOHN A. ABRAMS, et al.,
)
)
)
)
)
)
)
)
)
)
Plaintiffs,
v.
JOHN DAVID STROUD,
et al.,
Defendants.
CIVIL ACTION NO.
2:12cv177-MHT
(WO)
OPINION
The plaintiffs, all investors, brought this action
naming as defendants several investment companies and
two
individuals,
controlled
those
violations
of
commodities
who
they
allege
companies.
federal
exchange
The
and
laws,
co-founded
plaintiffs
state
and
claim
securities
breaches
of
and
fiduciary
duties, unjust enrichment, negligence and wantonness,
fraud, and conversion.
proper
under
U.S.C.
§
28
25(c)
U.S.C.
Subject-matter jurisdiction is
§ 1331
(Commodities
U.S.C. § 1367 (supplemental).
(federal
Exchange
question),
Act),
and
7
28
In
judgment
a
previous
in
favor
order,
of
the
John
court
A.
granted
Abrams,
default
Priscilla
W.
Abrams, Debra Clark, Baron J. Lowe, Melanie D. Lowe,
Fredrick Glen Williams, Kristy A. Williams, and Flynn
R.
DuBose,
Jr.
and
against
defendants
John
David
Stroud, TS Capital Partners, TS Capital Partners, LLC,
TS Capital Management, LLC, TS Capital Fund, LP, and TS
Capital GP, LLC on all claims in the second amended
complaint.
See Default Judgment (Doc. No. 98).
The
court reserved the question of the amount of damages at
that time.
The case is now before this court on the matter of
the
amount
of
damages
to
which
the
plaintiffs
are
entitled from the defaulting defendants.
I. FINDINGS OF FACT
A. Plaintiffs’ Investment Losses
1.
Stroud organized several entities in the Stroud
Capital name which he operated as a hedge fund prior to
forming the TS Capital entities.
2
Those entities were:
Stroud Capital Fund, L.P., Stroud Capital GP, LLC, and
Stroud Capital Management, LLC.
Doc.
No.
37
collectively
at
¶¶
17
referred
&
Doc. No. 209-1 at ¶ 6;
18.
to
These
as
the
entities
“Stroud
are
Capital
Entities.”
2.
Financial records subpoenaed from third parties
in connection with this case show that Stroud often
transferred money between accounts held in different
legal names and sometimes deposited funds payable to
one entity into accounts held by other entities.
No. 209-1 at ¶ 18.
Doc.
These records indicate that Stroud
did not properly respect the legal distinctions between
entities.
deposited
Id.
in
At
accounts
least
held
$
in
106,186.43
the
names
in
of
funds
Stroud
Capital Entities were transferred into accounts held in
the names of TS Capital Partners, TS Capital Partners,
LLC, TS Capital Management, LLC, TS Capital Fund, L.P.,
or TS Capital GP, LLC and expended apparently for the
benefit of TS Capital Partners, TS Capital Partners,
LLC, TS Capital Management, LLC, TS Capital Fund, L.P.,
3
and
TS
Capital
Moreover,
GP,
Stroud
LLC.
Doc.
withdrew
more
No.
than
209-1
$
at
¶
590,000
19.
from
accounts held in the names of Stroud Capital Entities
and deposited at least $ 165,000 into accounts held in
the names of TS Capital Partners, TS Capital Partners,
LLC, TS Capital Management, LLC, TS Capital Fund, L.P.,
or TS Capital GP, LLC.
substantial
amounts
Id.
of
Stroud frequently withdrew
cash
from
accounts
investor funds which he did not repay.
3.
The
aggregate
value
of
holding
Id.
John
Abrams’s
investments was $ 794,480.34 with Stroud, TS Capital
Partners,
TS
Capital
Partners,
LLC,
TS
Capital
Management, LLC, TS Capital Fund, L.P., and TS Capital
GP,
LLC
and
their
Capital Entities.
4.
John
predecessor
entities,
the
Stroud
Doc. No. 209-1 at ¶ 10 & Ex. A.
Abrams
received
disbursements
in
the
amount of $ 183,530 during the time of his investment.
Doc. No. 209-1 at ¶ 10 & Ex. A.
5.
John
investments
Abrams’s
with
Stroud
net
in
4
investment
TS
Capital
losses
from
Partners,
TS
Capital Partners, LLC, TS Capital Management, LLC, TS
Capital Fund, L.P., and TS Capital GP, LLC or their
predecessor entities, the Stroud Capital Entities, are
$ 610,950.34.
6.
The
Doc. No. 209-1 at ¶ 10 & Ex. A.
aggregate
initial
value
Abrams’s investments was $ 10,778.95.
of
Priscilla
Doc. No. 209-1
at ¶ 10 & Ex. A.
7.
She received no disbursement with respect to
her investments.
8.
Doc. No. 209-1 at ¶ 10 & Ex. A.
Priscilla Abrams’s net investment losses from
investments
with
Stroud
in
TS
Capital
Partners,
TS
Capital Partners, LLC, TS Capital Management, LLC, TS
Capital Fund, L.P., and TS Capital GP, LLC or their
predecessor entities, the Stroud Capital Entities, are
$ 10,778.95.
9.
Doc. No. 209-1 at ¶ 10 & Ex. A.
The aggregate initial value of Debra Clark’s
investments
with
Stroud
in
TS
Capital
Partners,
TS
Capital Partners, LLC, TS Capital Management, LLC, TS
Capital
Fund,
L.P.,
and
TS
5
Capital
GP,
LLC
was
approximately $ 284,450.36.
Doc. No. 209-1 at ¶ 11 &
Ex. B.
10. Debra
Clark
received
respect to her investments.
no
disbursement
with
Doc. No. 209-1 at ¶ 11 &
Ex. B.
11. Debra
investments
Clark’s
with
net
Stroud
in
investment
TS
losses
Capital
from
Partners,
TS
Capital Partners, LLC, TS Capital Management, LLC, TS
Capital
Fund,
$ 284,450.36.
12. The
L.P.,
and
TS
Capital
GP,
LLC
are
Baron
and
Doc. No. 209-1 at ¶ 11 & Ex. B.
aggregate
initial
value
of
Melanie Lowe’s investments with Stroud in TS Capital
Partners,
TS
Capital
Partners,
LLC,
TS
Capital
Management, LLC, TS Capital Fund, L.P., and TS Capital
GP, LLC was approximately $ 532,158.40.
at ¶ 13 & Ex. D.
Baron Lowe’s individual investments
totaled $ 269,419.86.
Melanie
Lowe’s
$ 20,158.25.
Doc. No. 209-1
Doc. No. 209-1 at ¶ 13 & Ex. D.
individual
investments
Doc. No. 209-1 at ¶ 13 & Ex. D.
6
totaled
Their
joint investments totaled $ 242,580.29.
Doc. No. 209-1
at ¶ 13 & Ex. D.
13. Baron Lowe received only one disbursement, in
the amount of $ 10,000, with respect to his individual
investments
and
investments.
no
disbursements
from
their
joint
Doc. No. 209-1 at ¶ 13 & Ex. D.
14. Melanie
Lowe
received
no
disbursement
with
respect to her investments or their joint investments.
Doc. No. 209-1 at ¶ 13 & Ex. D.
15. Baron
investments
Lowe’s
with
net
Stroud
investment
TS
in
losses
Partners,
Capital
from
TS
Capital Partners, LLC, TS Capital Management, LLC, TS
Capital
Fund,
$ 259,419.86.
L.P.,
TS
Capital
GP,
LLC
are
Doc. No. 209-1 at ¶ 13 & Ex. D.
16. Melanie
investments
and
Lowe’s
with
Stroud
net
in
investment
TS
Capital
losses
from
Partners,
TS
Capital Partners, LLC, TS Capital Management, LLC, TS
Capital
Fund,
$ 20,158.25.
L.P.,
and
TS
Capital
GP,
Doc. No. 209-1 at ¶ 13 & Ex. D.
7
LLC
are
17. Baron and Melanie Lowe had additional joint net
investment losses from investments with Stroud in TS
Capital Partners, TS Capital Partners, LLC, TS Capital
Management, LLC, TS Capital Fund, L.P., and TS Capital
GP, LLC totaling $ 242,580.29.
& Ex. D.
Doc. No. 209-1 at ¶ 13
$ 68,078.41 of that amount was to be held for
the benefit of their minor children.
18. The aggregate initial value of Glen Williams's
investments
with
Stroud
in
TS
Capital
Partners,
TS
Capital Partners, LLC, TS Capital Management, LLC, TS
Capital
Fund,
L.P.,
and
TS
Capital
GP,
LLC
was
$ 120,005.32, and the aggregate initial value of Kristy
Williams’s
Partners,
investments
TS
Capital
with
Stroud
Partners,
in
LLC,
TS
Capital
TS
Capital
Management, LLC, TS Capital Fund, L.P., and TS Capital
GP, LLC was $ 18,921.03.
Doc. No. 209-1 at ¶ 14 & Ex.
E.
19. Neither Glen nor Kristy Williams received any
disbursement with respect to their investments.
No. 209-1 at ¶ 14 & Ex. E.
8
Doc.
20. The
Williamses’
joint
net
investment
losses
from investments with Stroud in TS Capital Partners, TS
Capital Partners, LLC, TS Capital Management, LLC, TS
Capital
Fund,
$ 138,926.35.
L.P.,
and
TS
Capital
GP,
LLC
are
Doc. No. 209-1 at ¶ 14 & Ex. E.
21. The aggregate value of DuBose’s investments was
$
1,260,000
with
Stroud
in
TS
Capital
Partners,
TS
Capital Partners, LLC, TS Capital Management, LLC, TS
Capital Fund, L.P., and TS Capital GP, LLC or their
predecessor
entities,
the
Stroud
Capital
Entities.
Doc. No. 209-1 at ¶ 12 & Ex. C.
22. DuBose received disbursements in the amount of
$ 1,000,000 during the time of his investment.
Doc.
No. 209-1 at ¶ 12 & Ex. C.
23. DuBose’s net investment losses from investments
with
Stroud
in
TS
Capital
Partners,
TS
Capital
Partners, LLC, TS Capital Management, LLC, TS Capital
Fund, L.P., and TS Capital GP, LLC or their predecessor
entities, the Stroud Capital Entities, are $ 260,000.
Doc. No. 209-1 at ¶ 12 & Ex. C.
9
B. Punitive Damages
24. Most of the plaintiffs have suffered a complete
loss of their investments and the remaining plaintiffs
suffered a near total loss.
Doc. No. 209-1 at ¶¶ 10-14
& Exs. A-E.
25. Stroud used bank accounts held in the name of
TS
Capital
Partners,
TS
Capital
Partners,
LLC,
TS
Capital Management, LLC, TS Capital Fund, L.P., and TS
Capital GP, LLC or their predecessors to pay for lavish
travel and personal expenses utterly unassociated with
the
business
operations
of
TS
Capital
Partners,
TS
Capital Partners, LLC, TS Capital Management, LLC, TS
Capital
Fund,
L.P.,
and
TS
Capital
GP,
LLC
and
frequently withdrew substantial amounts of cash from
accounts holding investor funds, which sums he did not
repay.
Doc. No. 209-1 at ¶¶ 15-20; Doc. Nos. 112, 115,
116, 117 & 119; Doc. Nos. 210-1, 210-2, 210-3, 211-1,
211-2, 212-1, 212-2, 213-1, 213-2, 214-1 (Stroud Dep.
1:1-12:4;
161:8-12;
161:15-164-:17;
165:2-167:10;
168:21-169:6; 169:23-181:9; 183:6-188:13; 189:3-207:3;
10
212:22-215:13;
245:9;
(Memory
223:9-223:20;
248:11-250:5;
Dep.
231:6-235:12;
274:10-275:23);
88:7-21);
Doc.
No.
Doc.
214-3
241:10-
No.
(Patrick
214-2
Dep.
142:13-143:20); Doc. No. 214-4 (Senn Dep. 41:4-19; 42:
6-14).
26. Stroud
and
TS
Capital
Partners,
TS
Capital
Partners, LLC, TS Capital Management, LLC, TS Capital
Fund,
L.P.,
and
TS
Capital
GP,
LLC
solicited
plaintiffs’ investments in TS Fund managed and operated
by
defendants,
omissions,
and
through
fraudulent
untrue
measures.
representations,
Doc.
No.
214-4
(Senn Dep. 56:11-57:8); Doc. No.117-39 (P. Abrams Dep.
25:11-26:8; 58:1-59:7); Doc. No. 117-26 (J. Abrams Dep.
150:1-156:7), Doc. No. 117-23 (Clark Dep. 83:18-84:21);
Doc. No. 37 at ¶¶ 19, 20, 44, & 59.
27. Stroud
also
made
false
and
misleading
oral
statements to plaintiffs to induce them to invest or to
keep their investments in place.
Doc. No. 214-4 (Senn
Dep. 65:2-20); Doc. No. 37 at ¶¶ 19, 20, 44, & 59-73.
11
28. Stroud
and
TS
Capital
Partners,
TS
Capital
Partners, LLC, TS Capital Management, LLC, TS Capital
Fund, L.P., and TS Capital GP, LLC commingled personal,
operating,
and
investor
funds
and
disregarded
the
separate legal identities of TS Capital Partners, TS
Capital Partners, LLC, TS Capital Management, LLC, TS
Capital Fund, L.P., and TS Capital GP, LLC and their
predecessor entities.
Doc. No. 209-1 at ¶¶ 15-20; Doc.
Nos. 210-1, 210-2, 210-3, 211-1, 211-2, 212-1, 212-2,
213-1, 213-2, 214-1 (Stroud Dep. 1:1-12:4; 161:8-12;
161:15-164-:17;
165:2-167:10;
168:21-169:6;
169:23-
181:9; 183:6-188:13; 189:3-207:3; 212:22-215:13; 223:9223:20;
231:6-235:12;
241:10-245:9;
248:11-250:5;
274:10-275:23); Doc. No. 214-4 (Senn Dep. 66:10-67:7);
Doc.
No.
117-22
(Regions-TSC
000216;
(Senn
Partners
Regions-TSC
Dep.
41:14-19);
000167;
Partners
Doc.
Regions-TSC
000226;
No.
111
Partners
Regions-TSC
Partners 000244; Regions-TSC Partners 000262; RegionsTSC
Partners
Regions-TSC
000283;
Partners
Regions-TSC
000302;
12
Partners
Regions-TSC
000295;
Partners
000330;
Regions-TSC
Partners
000352;
Regions-TSC
Partners 000393; Regions-TSC Partners 000403; RegionsTSC
Partners
000420;
Regions-TSC
Partners
000447;
Regions-TSC Partners 000457; TSC Partners 000489; TSC
Partners 000497; Regions-TSC Partners 000515; RegionsTSC Partners 000531; TSC Partners 000545; Regions-TSC
Partners 000564; Regions-TSC Partners 000582; RegionsTSC Partners 000595; Regions-TSC Partners 000597); Doc.
No. 37 at ¶¶ 19, 20.
29. TS Capital Partners, TS Capital Partners, LLC,
TS Capital Management, LLC, TS Capital Fund, L.P., and
TS Capital GP, LLC retained the key personnel, assets,
and general operations of their predecessor entities,
the Stroud Capital Entities.
Doc. No. 209-1 at ¶¶ 15-
20; Doc. No. 214-4 (Senn Dep. 66:10-67:7); Doc. No. 37
at ¶ 18.
13
C. Attorney’s Fees
30. Capell
&
Howard,
P.C.
represented
the
plaintiffs in this action from the inception of the
case.
Doc. No. 1.
31. Attorneys from Capell & Howard, P.C. expended
more than 2,850 hours and incurred more than $ 70,860
in expenses in connection with pursuing all claims in
this litigation from December 1, 2011 to October 29,
2013.
Doc. No. 209-3 at ¶ 11.
32. The regular hourly rates for the attorneys from
Capell & Howard, P.C. who worked on this matter are
reasonable
and
commensurate
prevailing
market
rate
in
with,
the
or
less
Middle
than,
District
the
of
Alabama for similar services by lawyers of reasonably
comparable
skills,
experience,
matters of this nature.
and
reputation
in
Doc. No. 209-3 at ¶ 14; Doc.
No. 209-2 at ¶¶ 4-10, 15-34.
33. The amount of time spent on the matter was
appropriate and reasonable in view of the complexity of
the case.
Doc. No. 209-3 at ¶¶ 16-17.
14
34. Counsel
for
plaintiffs
have
submitted
documentation justifying their estimates of the amount
of
attorney’s
fees
reasonably
attributable
to
the
claims against Stroud, TS Capital Partners, TS Capital
Partners, LLC, TS Capital Management, LLC, TS Capital
Fund, L.P., and TS Capital GP, LLC.
Doc. No. 209-2 &
Exhibits thereto; Doc. No. 209-3.
II. CONCLUSIONS OF LAW
35. This court has subject matter jurisdiction over
this
action
pursuant
to
28
U.S.C.
§ 1331
(federal
question), 7 U.S.C. § 25(c) (Commodities Exchange Act),
and 28 U.S.C. § 1367 (supplemental).
36. Venue in the United States District Court for
the
Middle
District
of
Alabama
is
proper
under
28
U.S.C. § 1391(b)(2), as amended by the Federal Courts
Jurisdiction
and
Venue
Clarification
Act
of
2011.
A
substantial part of the events or omissions giving rise
to
the
claims
occurred
in
15
the
Middle
District
of
Alabama.
All
defendants
are
subject
to
personal
jurisdiction in this judicial district.
37. Under Federal Rule of Civil Procedure 55(a), a
default
is
entered
when
“a
party
against
whom
a
judgment for affirmative relief is sought has failed to
plead or otherwise defend....” Fed. R. Civ. P. 55(a).
38. In this matter, a Clerk’s Entry of Default has
been entered against Stroud, TS Capital Partners, TS
Capital Partners, LLC, TS Capital Management, LLC, TS
Capital Fund, L.P., and TS Capital GP, LLC.
See Doc.
No. 66 & Doc. No. 67.
39. Upon
entry
of
default,
the
well-pleaded
allegations in the complaint are to be taken as true
for purposes of establishing liability.
Fed. R. Civ.
P. 8(b)(6) (“An allegation—other than one relating to
the
damages—is
admitted
if
a
responsive
pleading
is
required and the allegation is not denied.”).
40. Rule 55 of the Federal Rules of Civil Procedure
authorizes
defendant
the
entry
fails
“to
of
a
plead
16
default
or
judgment
otherwise
when
defend”
a
in
accordance with the Rules.
41. In this matter, the court entered a judgment
pursuant
to
Priscilla
Melanie
55(b)(2)
W.
D.
Abrams,
Lowe,
in
favor
Debra
Fredrick
of
Clark,
Glen
John
A.
Baron
Williams,
Abrams,
J.
Lowe,
Kristy
A.
Williams, and Flynn R. Dubose, Jr. and against John
David Stroud, TS Capital Partners, TS Capital Partners,
LLC, TS Capital Management, LLC, TS Capital Fund, L.P.,
and TS Capital GP, LLC on May 7, 2013.
See Doc. No.
98.
42. The
court
has
now
considered
the
evidence
relating to the amount of damages to which plaintiffs
are
entitled
Partners,
TS
from
John
Capital
David
Stroud,
Partners,
LLC,
TS
Capital
TS
Capital
Management, LLC, TS Capital Fund, L.P., and TS Capital
GP, LLC and is prepared to decree the amount of the
judgment in favor of each plaintiff.
43. Judgment is due to be entered in favor of John
A. Abrams and against defendants: Stroud, TS Capital
Partners,
TS
Capital
Partners,
17
LLC,
TS
Capital
Management, LLC, TS Capital Fund, L.P., and TS Capital
GP,
LLC
in
the
total
amount
of
$
610,950.34
for
compensatory damages, which sum reflects net losses.
Pursuant
to
1975
Code
of
Alabama
§
8-6-19(a)
and
Securities Act of 1933, 7 U.S.C. § 77l, John Abrams is
entitled
interest.
to
return
Due
to
of
his
the
entire
fact
that
investment
Abrams
with
received
disbursements at various times, the award of interest
will
be
requiring
calculated
him
to
from
prove
his
the
net
precise
calculation through expert testimony.
losses
complex
to
avoid
interest
Based on the six
percent per annum rate of interest under § 8-6-19(a),
John Abrams is entitled to interest of $ 191,717.38
through October 30, 2013, and additional interest at
the rate $ 100.43 per day from October 30, 2013 to the
date of the accompanying judgment.
44. Judgment
is
due
to
be
entered
in
favor
of
Priscilla W. Abrams and against defendants: Stroud, TS
Capital Partners, TS Capital Partners, LLC, TS Capital
Management, LLC, TS Capital Fund, L.P., and TS Capital
18
GP,
LLC
in
the
total
amount
of
$
10,778.95
for
compensatory damages, which sum reflects net losses.
Pursuant
to
Securities
1975
Act
Code
of
1933,
of
7
Alabama
§
U.S.C.
§
8-6-19(a)
77l,
and
Priscilla
Abrams is entitled to return of her entire investment
with interest.
of
interest
Based on the six percent per annum rate
under
§
8-6-19(a),
Priscilla
Abrams
is
entitled to interest of $ 2,911.20 through October 30,
2013 and additional interest at the rate $ 1.77 per day
from October 30, 2013 to the date of the accompanying
judgment.
45. Judgment is due to be entered in favor of Debra
Clark
and
Partners,
against
TS
defendants:
Capital
Stroud,
Partners,
LLC,
TS
Capital
TS
Capital
Management, LLC, TS Capital Fund, L.P., and TS Capital
GP,
LLC
in
the
total
amount
of
$
284,450.36
for
compensatory damages, which sum reflects net losses.
Pursuant
to
Securities
entitled
1975
Act
to
Code
of
return
of
1933,
7
of
her
19
Alabama
U.S.C.
entire
§
§
8-6-19(a)
77l,
and
Clark
investment
is
with
interest.
Based on the six percent per annum rate of
interest under
§ 8-6-19(a), Clark is entitled to
interest of $ 53,857.84 through October 30, 2013 and
additional interest at the rate $ 46.76 per day from
October
30,
2013
to
the
date
of
the
accompanying
judgment.
46. Judgment is due to be entered in favor of Baron
J.
Lowe
Partners,
and
against
TS
defendants:
Capital
Stroud,
Partners,
LLC,
TS
TS
Capital
Capital
Management, LLC, TS Capital Fund, L.P., and TS Capital
GP,
LLC
in
the
total
amount
of
$
259,419.86
for
compensatory damages, which sum reflects net losses.
Pursuant
to
1975
Code
of
Alabama
§
8-6-19(a)
and
Securities Act of 1933, 7 U.S.C. § 77l, Baron Lowe is
entitled
interest.
to
return
of
his
entire
investment
with
Based on the six percent per annum rate of
interest under
to interest of
§ 8-6-19(a), Baron Lowe is entitled
$ 44,622.62 through October 30,
2013 and additional interest at the rate $ 44.29 per
day
from
October
15,
2013
20
to
the
date
of
the
accompanying judgment.
47. Judgment
Melanie
D.
Lowe
is
due
and
to
be
against
entered
in
defendants:
favor
of
Stroud,
TS
Capital Partners, TS Capital Partners, LLC, TS Capital
Management, LLC, TS Capital Fund, L.P., and TS Capital
GP,
LLC
in
the
total
amount
of
$
20,158.25
for
compensatory damages, which sum reflects net losses.
Pursuant
to
1975
Code
of
Alabama
§
8-6-19(a)
and
Securities Act of 1933, 7 U.S.C. § 77l, Melanie Lowe is
entitled
to
interest.
return
of
her
entire
investment
with
Based on the six percent per annum rate of
interest under § 8-6-19(a), Melanie Lowe is entitled to
interest of $ 3,114.86 through October 30, 2013 and
additional interest at the rate $ 3.31 per day from
October
30,
2013
to
the
date
of
the
accompanying
judgment.
48. Judgment is due to be entered in favor of Baron
J. Lowe and Melanie D. Lowe, as joint tenants, and
against
defendants:
Stroud,
TS
Capital
Partners,
TS
Capital Partners, LLC, TS Capital Management, LLC, TS
21
Capital Fund, L.P., and TS Capital GP, LLC in the total
amount of $ 174,501.88 for compensatory damages, which
sum reflects net losses.
Alabama
§
8-6-19(a)
and
Pursuant to 1975 Code of
Securities
Act
of
1933,
7
U.S.C. § 77l, the Lowes are entitled to return of their
entire
investment
with
interest.
Based
on
the
six
percent per annum rate of interest under § 8-6-19(a),
the
Lowes
are
entitled
to
interest
of
$
27,939.42
through October 30, 2013 and additional interest at the
rate $ 28.69 per day from October 30, 2013 to the date
of the accompanying judgment.
49. Judgment is due to be entered in favor of Baron
J. Lowe, as custodian of funds held for the benefit of
his minor children, and against defendants: Stroud, TS
Capital Partners, TS Capital Partners, LLC, TS Capital
Management, LLC, TS Capital Fund, L.P., and TS Capital
GP,
LLC
in
the
total
amount
of
$
68,078.41
for
compensatory damages, which sum reflects net losses.
Pursuant
to
1975
Code
of
Alabama
§
8-6-19(a)
and
Securities Act of 1933, 7 U.S.C. § 77l, Lowe's children
22
are entitled to return of their entire investments with
interest.
interest
Based on the six percent per annum rate of
under
§
8-6-19(a),
Lowe's
children
are
entitled to interest of $ 10,116.64 through October 30,
2013 and additional interest at the rate $ 11.19 per
day
from
October
30,
2013
to
the
date
of
the
entered
in
favor
of
accompanying judgment.
50. Judgment
is
due
to
be
Fredrick Glen Williams and against defendants: Stroud,
TS
Capital
Partners,
TS
Capital
Partners,
LLC,
TS
Capital Management, LLC, TS Capital Fund, L.P., and TS
Capital GP, LLC in the total amount of $ 120,005.32 for
compensatory damages, which sum reflects net losses.
Pursuant
to
1975
Code
of
Alabama
§
8-6-19(a)
and
Securities Act of 1933, 7 U.S.C. § 77l, Glen Williams
is entitled to return of his entire investment with
interest.
Based on the six percent per annum rate of
interest under § 8-6-19(a), Glen Williams is entitled
to interest of $ 21,940.98 through October 30, 2013 and
additional interest at the rate $ 19.73 per day from
23
October
30,
2013
to
the
date
of
the
accompanying
judgment.
51. Judgment
is
due
to
be
entered
in
favor
of
Kristy A. Williams and against defendants: Stroud, TS
Capital Partners, TS Capital Partners, LLC, TS Capital
Management, LLC, TS Capital Fund, L.P., and TS Capital
GP,
LLC
in
the
total
amount
of
$
18,921.03
for
compensatory damages, which sum reflects net losses.
Pursuant
to
1975
Code
of
Alabama
§
8-6-19(a)
and
Securities Act of 1933, 7 U.S.C. § 77l, Kristy Williams
is entitled to return of her entire investment with
interest.
Based on the six percent per annum rate of
interest under § 8-6-19(a), Kristy Williams is entitled
to interest of $ 3,688.82 through October 30, 2013 and
additional interest at the rate $ 3.11 per day from
October
30,
2013
to
the
date
of
the
accompanying
judgment.
52. Judgment is due to be entered in favor of Flynn
R.
Dubose,
Jr.,
and
against
defendants:
Stroud,
TS
Capital Partners, TS Capital Partners, LLC, TS Capital
24
Management, LLC, TS Capital Fund, L.P., and TS Capital
GP,
LLC
in
the
total
amount
of
$
260,000
for
compensatory damages, which sum reflects net losses.
Pursuant
to
Securities
entitled
1975
Act
to
interest.
Code
of
of
1933,
return
of
Alabama
7
U.S.C.
his
§
§
entire
8-6-19(a)
77l,
and
Dubose
investment
is
with
Based on the six percent per annum rate of
interest under
§ 8-6-19(a), Dubose is entitled to
interest of
$ 65,988.49 through October 30,
2013 and additional interest at the rate $ 42.74 per
day
from
October
30,
2013
to
the
date
of
the
accompanying judgment.
53. As part of the judgment due to be entered in
favor of plaintiffs, pursuant to Counts 10, 11, 15, 16,
and 17 of the Second Amended Complaint, John A. Abrams,
Priscilla
Melanie
W.
D.
Williams,
Abrams,
Lowe,
and
Debra
Fredrick
Flynn
R.
Clark,
Glen
Dubose,
Baron
Williams,
Jr.
are
J.
Lowe,
Kristy
A.
entitled
to
$ 5,481,792.18 in punitive damages against Stroud, TS
Capital Partners, TS Capital Partners, LLC, TS Capital
25
Management, LLC, TS Capital Fund, L.P., and TS Capital
GP,
LLC.
This
amount
represents
three
times
the
aggregate net losses of all plaintiffs ($ 1,827,264.06)
and is intended to punish Stroud, TS Capital Partners,
TS Capital Partners, LLC, TS Capital Management, LLC,
TS Capital Fund, L.P., and TS Capital GP, LLC for their
egregious misconduct and to deter Stroud, TS Capital
Partners,
TS
Capital
Partners,
LLC,
TS
Capital
Management, LLC, TS Capital Fund, L.P., and TS Capital
GP, LLC from future misconduct.
54. As part of the judgment due to be entered in
favor of plaintiffs, pursuant to Counts 8 and 10 of the
Second Amended Complaint, John A. Abrams, Priscilla W.
Abrams, Debra Clark, Baron J. Lowe, Melanie D. Lowe,
Fredrick Glen Williams, Kristy A. Williams, and Flynn
R.
Dubose,
Jr.
are
entitled
to
$
67,908.61
in
attorney’s fees against John David Stroud, TS Capital
Partners,
TS
Capital
Partners,
LLC,
TS
Capital
Management, LLC, TS Capital Fund, L.P., and TS Capital
GP, LLC.
This sum represents a reasonable attorney’s
26
fee for the claims against these defendants pursuant to
Counts 8 and 10 only.
55. As part of the judgment due to be entered in
favor of plaintiffs pursuant to 28 U.S.C. § 1920, John
A. Abrams, Priscilla W. Abrams, Debra Clark, Baron J.
Lowe, Melanie D. Lowe, Fredrick Glen Williams, Kristy
A. Williams, and Flynn R. Dubose, Jr. are entitled to
taxable costs, which upon a proper application shall be
taxed against John David Stroud, TS Capital Partners,
TS Capital Partners, LLC, TS Capital Management, LLC,
TS Capital Fund, L.P., and TS Capital GP, LLC.
An appropriate judgment will be entered.
DONE, this the 12th day of December, 2013.
/s/ Myron H. Thompson
UNITED STATES DISTRICT JUDGE
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