Ashmore v. Carr et al

Filing 10

ORDER granting 6 MOTION for Temporary Restraining and setting a hearing regarding the imposition of a preliminary injunction on April 9, 2012, at 2:00 PM at Courtroom V, Matthew J. Perry, Jr. Federal Courthouse, 901 Richland Street, Columbia, South Carolina. Signed by Chief Judge Margaret B Seymour on 3/27/2012. (asni, ) (Main Document 10 replaced on 3/27/2012) (asni, ).

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF SOUTH CAROLINA
COLUMBIA DIVISION
BEATTIE B. ASHMORE, IN HIS
CAPACITY AS COURT-APPOINTED
RECEIVER FOR THE THREE HEBREW
BOYS,
Plaintiff,
vs.
ANTONIO V. CARR, AND
DREAMMAKERS REAL ESTATE
INVESTMENT COMPANY, LLC
Defendants.

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No. 3:12-cv-434-MBS

ORDER

The within action arises from an investigation into the activities of Tony Pough, Joseph
Brunson, and Timothy McQueen and the various business entities with which they are affiliated.
The court entered an order on September 5, 2007 (“September 5 Order”), amended October 10,
2008, April 15, 2010, and April 15, 2010, appointing Beattie B. Ashmore, Esquire to serve as
Receiver with respect to assets under the control or the custody of Tony Pough, Joseph Brunson, and
Timothy McQueen, doing business as Three Hebrew Boys, LLC; Capital Consortium Group, LLC;
Brunson Outreach; Daniel Development Group, LLC; Wotteth Outreach Ministries; Vision
Financial Service; Faith Ministries; Warrior Express; TMS Family Trust; Purpose Driven, LLC; TriWarrior Transit, LLC; Tri-Transit Logistics, LLC; KMF, Inc.; and Vision Outreach (collectively
“Three Hebrew Boys”). Pough, Brunson, and McQueen were found by a jury to have operated a
Ponzi scheme. Accordingly, on November 20, 2009, Pough, Brunson, and McQueen were found
guilty on multiple counts of conspiracy to commit mail fraud, swindling, scheming to defraud, and
engaging in facilitating monetary transactions by, through, and to a financial institution. See United

States v. Brunson, Cr. No. 3:08-615.
In carrying out his duties, the Receiver has claimed a right to profits of the illegal Ponzi
scheme obtained by “net winners,” including Defendants

Antonio V. Carr (“Carr”) and

Dreammakers Real Estate Investment Company, LLC (“Dreammakers”). The Receiver contends
that Defendant Car profited in the amount of $365,362.87 as the result of participating in eight
mortgage payoff programs as well as various other satisfaction programs and long term residual
payments.
This matter is before the court on the Receiver’s Motion for a Temporary Restraining Order
and/or Preliminary Injunction pursuant to Fed. R. Civ. P. 65. See ECF No. 6. In the Motion, the
Receiver asks the court to enjoin Defendants Carr and Dreammakers from transferring or otherwise
encumbering the eight properties listed in Exhibit A to the Receiver’s Complaint and ordering Carr
and Dreammakers to hold in escrow all rental income generated from said properties until further
order of this court. In addition, the Receiver asks the court to allow the Receiver to record Lis
Pendens on the properties listed in Exhibit A to the Receiver’s Complaint.
Pursuant to Rule 65(b)(1) of the Federal Rules of Civil Procedure, the Receiver’s counsel
certified to the court, based upon information learned from their retained process server, that Carr,
individually and as owner of Dreammakers, was attempting to evade service of the Summons,
Complaint, and Rule 65 Motion. Such efforts to evade service concerned the Receiver as to Carr’s
intentions with respect to the assets at issue in the underlying lawsuit. Therefore, the court grants
the request for an ex parte temporary restraining order and sets a hearing for the Receiver’s request
for a Preliminary Injunction on April 9, 2012 at 2:00 PM. The court further finds that the Receiver
is exempt from the requirements of Rule 65(c) of the Federal Rules of Civil Procedure.
The standard for issuing a preliminary injunction and a temporary restraining order is the
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same. See Moore v. Kempthorne, 464 F. Supp. 2d 519, 525 (E.D. Va. 2006). A plaintiff seeking
injunctive relief must demonstrate “that he is likely to succeed on the merits, that he is likely to
suffer irreparable harm in the absence of preliminary relief, that the balance of equities tips in his
favor, and that an injunction is in the public interest.” Winter v. Natural Res. Def. Council, Inc, 555
U.S. 7, 20 (2008). The Court finds that the Receiver has met his burden for injunctive relief.
First, the Receiver has demonstrated that he is likely to succeed on the merits. The Receiver
filed a Complaint contemporaneously with the underlying Motion seeking recoupment of monies
obtained by Defendants directly from a criminal Ponzi scheme.1 The Receiver alleges that
Defendants profited from the Ponzi scheme in the amount of $365,362.87. The circumstances
surrounding receipt of these funds are sufficient to “arouse the suspicion of an ordinarily prudent
man and cause him to make inquiry” as to the purpose of the transfers. Coleman v. Daniel, 199
S.E.2d 74, 80 (S.C. 1973). Specifically, the return on investment guaranteed and earned on deposits
made with the Three Hebrew Boys was grossly in excess of comparable rates of return on other
investment vehicles in the market at that time. As such, the first element required for injunctive
relief has been met.
Second, the Receiver has demonstrated that he is likely to suffer irreparable harm in the
absence of preliminary relief. Defendants are in possession of eight properties for which the
mortgages were satisfied as a direct result of the Ponzi scheme. These properties are free and clear
of liens and encumbrances based upon current information and belief. If left unrestrained,
Defendants would be able to encumber these properties or transfer them to unknowing buyers, likely
depriving the Receiver of a remedy in this case. In addition, Defendants will continue to take rental
income from these properties paid for by criminal Ponzi scheme proceeds without any recourse by
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The underlying Complaint is related to In re Receiver, 3:10-cv-3141-MBS.

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the Receiver.
Third, the balance of equities tips in favor of the Receiver. If Defendants are not restrained
as set forth herein, the possibility exists for them to encumber the property or otherwise transfer the
property to unknowing purchasers, as well as take for their personal use those rent proceeds
currently generated off these properties. The harm to Defendants in granting this relief, however,
is minimal as, upon information and belief, these properties are held as rental properties. No harm
will come to defendants by preventing the sale or encumbrance pending a resolution on the merits.
Conversely, the harm to the Receivership and the persons for whom restitution is sought would be
tremendous.
Last, the public interest will be protected by restraining Defendants because it will allow the
court to determine these issues on the merit and protect the public. Specifically, the beneficiaries
of claims against Defendants are victims of the underlying criminal Ponzi scheme. Any net monies
recovered from Defendants will be returned to qualified persons who lost money in the Ponzi
scheme.
For these reasons, the court grants the Receiver’s Motion for a Temporary Restraining Order
and sets a hearing regarding the imposition of a preliminary injunction on April 9, 2012, at 2:00 PM
at Courtroom V, Matthew J. Perry, Jr. Federal Courthouse, 901 Richland Street, Columbia, South
Carolina. Therefore, it is
ORDERED that Defendants Carr and Dreammakers are hereby restrained from transferring
or otherwise encumbering the eight properties listed in Exhibit A to the Receiver’s Complaint. It
is further
ORDERED that Defendants Carr and Dreammakers shall hold in escrow all rental income
generated from said properties until further order of this court. It is further
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ORDERED that the Receiver record Lis Pendens on the properties listed in Exhibit A to the
Receiver’s Complaint.
The Receiver is directed to serve a copy of this Order on Defendants and file proof of service
with the court.
IT IS SO ORDERED.

/s/ Margaret B. Seymour
United States District Judge
Columbia, South Carolina
March 27, 2012

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