Ashmore v. Pressley et al
Filing
75
ORDER and OPINION granting in part and denying in part 53 Motion for Summary Judgment. Signed by Honorable J Michelle Childs on 9/18/17.(alew, )
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF SOUTH CAROLINA
ANDERSON/GREENWOOD DIVISION
Beattie B. Ashmore, in his capacity as
court-appointed Receiver for Ronnie
Wilson and Atlantic Bullion & Coin, Inc.,
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)
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Plaintiff,
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v.
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Jennifer and Shawn Pressley,
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and Southern First Bank,
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Defendants.
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____________________________________)
Southern First Bank,
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Third-Party Plaintiff,
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v.
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Cassie Wilson f/k/a Cassie Kendall,
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Third-Party Defendant.
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____________________________________)
Civil Action No.: 8:15-cv-04116-JMC
ORDER AND OPINION
Plaintiff Beattie B. Ashmore (“Plaintiff”), in his capacity as court-appointed Receiver for
Ronnie Gene Wilson (“Wilson”) and Atlantic Bullion and Coin, Inc. (“AB&C”), filed this action
against Defendants Jennifer and Shawn Pressley (“Defendants”) to recover real property and
money that flowed from the Wilson-AB&C Ponzi scheme. 1
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“A Ponzi scheme is a fraudulent investment program in which funds are paid in by investors and
later investors[’] funds are used to pay out nonexistent phantom profits to the original investors,
thus creating the illusion that the fraudulent investment program is a successful, profit generating
enterprise which, in turn attracts new investment funds that are used to sustain the fraudulent
program.” United States v. Wilson, Cr. No. 8:12-cr-00320-JMC, ECF No. 1-1 at 2 ¶ 6 (D.S.C.
Apr. 4, 2012). In Wilson, the United States alleged that Wilson, through AB&C, “orchestrated a
Ponzi scheme whereby he led investors to believe that he was investing their money in silver, when
in fact, Wilson was not buying silver but using the money for his personal gain. . . [and] [t]o keep
the Ponzi scheme going, Wilson also made payments to earlier investors to whom Wilson made
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This matter is before the court pursuant to Plaintiff’s Motion for Summary Judgment. (ECF
No. 53.) Specifically, Plaintiff requests that the court grant summary judgment with regard to the
unjust enrichment claim against Defendants and to transfer to Plaintiff a strip of land (hereinafter
“Flag Pole Acres”) currently held by Defendants. (Id. at 1.) Defendants oppose Plaintiff’s Motion,
asserting that it should be denied. For the reasons set forth below, the court GRANTS IN PART
and DENIES IN PART Plaintiff’s Motion for Summary Judgment (ECF No. 53).
I.
FACTUAL AND PROCEDURAL BACKGROUND
On December 2, 1999, Cassie Wilson, wife of Ronnie Wilson, purchased 59.74 acres of
land and placed the property in her name. (ECF No. 1 at 3.) On October 1, 2005, Cassie Wilson
purchased an additional 22.27 acres of land, totaling to 82.01 acres (hereinafter “the Wilson
Farm”). (Id. at 4.) Plaintiff alleges that the source of the money for the purchase of the 82.01
acres came from the Ponzi scheme. (ECF No. 53 at 3.)
On February 26, 2008, Cassie Wilson deeded over to her and Ronnie Wilson’s daughter,
Jennifer Pressley, and her spouse, Shawn Pressley, 6.58 acres of the land carved out of the Wilson
Farm (hereinafter “the Pressley Parcel”). (Id.) Plaintiff, as court-appointed Receiver in the related
matter, In Re: Receiver for Ronne Gene Wilson and Atl. Bullion & Coin, Inc., C/A No.: 8:12-cv02078-JMC, ECF No.1 (D.S.C. July 25, 2012), alleges that Defendants “received from the AB&C
Ponzi scheme a two acre tract of land (hereinafter “Home Acres”) and approximately $135,000.00,
the majority of which was used to build a home (hereinafter “the Pressley Home”) on that land, as
well as an additional strip of land of approximately five acres (Flag Pole Acres) in order to give
representations that their investments were earning high rates of return –sometimes in excess of
200 percent.” (Id. at ECF No. 17 at 1.) On July 30, 2012, Wilson and AB&C pled guilty to two
counts of mail fraud stemming from their involvement in the criminal Ponzi scheme. (ECF No. 1
at 3.)
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access to the two acres of real property upon which their primary residence is located.” (ECF No.
53 at 3.) The money was mostly paid to a contractor named Robbie Whitfield (“Whitfield”). (Id.
at 4.) To accomplish the completion of the construction, Defendants obtained a loan from
Greenville First Bank n/k/a Southern First Bank (“the Bank”) in the amount of $120,000.00. (Id.
at 5.) In exchange, the Bank was given a mortgage on Defendants’ home built on Home Acres.
(Id.) At the time of the mortgage, Defendants and the Bank believed the home and corresponding
recorded mortgage were on the Pressley Parcel. (ECF No. 1 at 5.) On August 29, 2013, Plaintiff
commissioned a full survey of the Wilson Farm and discovered that the Pressley Home was not
built on the Pressley Parcel, but rather on the Wilson Farm, which is real property currently held
by Plaintiff. (Id.)
Based on his appointment as Receiver tasked with “locating, managing, recouping, and
distributing the assets of the Wilson-AB&C investment scheme,” Plaintiff commenced this action
against Defendants on October 6, 2015, asserting claims for declaratory judgment regarding the
legal ownership of the real property upon which Defendants’ home was built and unjust
enrichment in the amount of $135,000.00. (Id.)
On February 15, 2017, Plaintiff filed a Motion for Summary Judgment, asserting that there
are no genuine disputes of material fact as to Plaintiff’s request for a declaratory judgment, or
claim for unjust enrichment and resulting damages of $135,000.00. (ECF No. 53 at 6.) As of the
filing of the Summary Judgment Motion, Plaintiff and the Bank agreed to a reformation of the
deed to reflect that the Pressley Home was built on the Pressley Parcel, now subject to the Bank’s
mortgage. 2 (Id. at 5.) Plaintiff asserted that the agreement to reform the deed involved only Home
2
See Southern First v. Pressley, 2016-CP-42-3079. Defendants are in default in the state court
action.
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Acres where the Pressley Home was built and the mortgage was placed. Thus, Plaintiff contended
that this left Flag Pole Acres, owned by Defendants, subject to Plaintiff’s declaratory judgment
action. (Id.)
On March 1, 2017, Defendants filed a response in opposition to Plaintiff’s Motion,
asserting there is a genuine dispute about the material facts because the amount of damages has
not been proven and thus, Plaintiff is not entitled to judgment as a matter of law. Further,
Defendants asserted that Flag Pole Acres is required by law to be attached to Home Acres 3 and
because the Pressley Home is in foreclosure, Plaintiff should seek damages from the Bank. (ECF
No. 56 at 2.)
On March 8, 2017, Plaintiff filed a Reply to Defendants’ response, asserting that based on
undisputed facts contained in the depositions of Shawn Pressley and Whitfield, Plaintiff lowered
the damages amount he was seeking from $135,000.00 to $73,705.00. (ECF No. 57 at 2.) Shawn
Pressley admitted that a portion of the initial costs for the construction of the home came from
Wilson through work performed by Whitfield and paid for by Wilson. (ECF No. 57-1 at 5-6.)
Whitfield stated that he was hired by Wilson to perform work on Defendants’ home. (ECF No.
57-2 at 2 ¶ 2.) He further stated, “I was responsible for contracting out the clearing and grading
of the lot, digging and pouring the basement, footings, foundation walls, framing, subfloors, roof
framing, roof sheathing and felting.” (Id. at ¶ 3.) In his affidavit, Whitfield stated that he had
receipts illustrating $4,300.00 he paid in checks, that he paid the concrete finisher $39,205.00 to
complete the basement slab and walls, and he had lumber and materials from Dixie lumber totaling
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Because the County of Spartanburg requires that all homes, such as the Pressley Home, have
legal access to the main county roads, Flag Pole Acres became an essential addition to the 2 acres
deeded to Defendants for the Pressley Home, all of which is now subject to foreclosure proceedings
in that county. However, Plaintiff contends that Flag Pole Acres are “critical to the Wilson Farm,”
subject to Plaintiff’s claim. (ECF No. 53 at 8 n.4.)
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$13,200.00. (Id. at ¶ 4-5, id. at 3 ¶ 7.) Further, Whitfield asserted that he paid a framer five dollars
a square foot to frame the home and three dollars a square foot to frame the basement, resulting in
approximately $17,000.00 of costs. (ECF No. 57-2 at 3 ¶ 6.) Shawn Pressley specifically testified
that Whitfield “paid for the materials and the pouring of the basement” and “paid for the framers
to do the labor.” 4 (ECF No. 57-1 at 5.) Plaintiff, however, still sought control of Flag Pole Acres,
asserting it was not subject to the Bank’s foreclosure action, and contended that Defendants’
argument that Plaintiff should seek damages from the Bank was “wholly without merit.” (ECF
No. 57 at 3.)
On March 10, 2017, Defendants filed a Sur-Reply to Plaintiff’s Reply, asserting that the
documents Plaintiff relied on to lower the damages amount were questionable. (ECF No. 60 at 1.)
Further, Defendants re-asserted that because the Bank is selling their home, Plaintiff needed to
seek damages from the Bank, not them. (Id. at 2.) Lastly, Defendants asserted that Plaintiff’s
allegations that Flag Pole Acres was partially acquired and partially improved with monies arising
from the Ponzi scheme were not supported by sufficient evidence. (Id. at 3.)
II.
JURISDICTION
The court has jurisdiction over this matter under 28 U.S.C. § 1331 pursuant to Plaintiff’s
allegation that the Complaint “is so related to the In Re Receiver, 8:12-cv-2078-JMC case and the
underlying criminal case, United States v Wilson, et al, 8:12-cr-00320[,]” cases in which the court
has jurisdiction, “that it forms part of the underlying case or controversy.” (ECF No. 1 at 1 ¶ 3.)
The court may properly hear Plaintiff’s state law claims for fraudulent transfer and unjust
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Whitfield states in his affidavit that the home was 2,365 square feet and the basement was 2,050
square feet. (ECF No. 57-2 at 3 ¶ 6.) These numbers were used to calculate the cost of framing.
(Id.) In his deposition, Shawn Pressley described the home as 2,500 square feet plus an additional
2,000 square feet in the basement. (ECF 57-1 at 6.) As such, there is no dispute of fact as to the
size of the home.
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enrichment based on supplemental jurisdiction since these claims “are so related to claims in the
action within such original jurisdiction that they form part of the same case or controversy . . .”
28 U.S.C. § 1367(a).
III.
LEGAL STANDARD
Summary judgment is appropriate “if the movant shows that there is no genuine dispute as
to any material fact and the movant is entitled to judgment as a matter of law. Fed. R. Civ. P.
56(a). “[I]n ruling on a motion for summary judgment, ‘the evidence of the nonmovant[s] is to be
believed, and all justifiable inferences are to be drawn in [their] favor.’” Tolan v. Cotton, ___ U.S.
___, 134 S. Ct. 1861, 1863 (2014) (per curiam) (brackets omitted) (quoting Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 255 (1986)). A dispute is genuine “if the evidence is such that a
reasonable jury could return a verdict for the nonmoving part[ies],” and a fact is material if it
“might affect the outcome of the suit under the governing law.” Anderson, 477 U.S. at 248.
The movant bears the initial burden of demonstrating to the court that no genuine issues of
material fact exist. See Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). Once this threshold
showing has been made, the non-moving party cannot survive summary judgment by resting on
the allegations in the pleadings. Rather, the non-moving party must provide specific, material facts
giving rise to a genuine issue. See id. at 324. Under this standard, the mere scintilla of evidence
is insufficient to withstand the summary judgment motion. See Anderson, 477 U.S. at 255 (1986).
IV.
ANALYSIS
The first dispute in this matter is whether there is no genuine issue of material fact as to
Plaintiff’s unjust enrichment claim in the amount of $73,705.00, stemming from Wilson/AB&C’s
direct payments for the construction of Defendants’ home. To prevail under a theory of unjust
enrichment, a plaintiff must demonstrate the following elements: “(1) [a] benefit conferred by [the]
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plaintiff upon the defendant, (2) realization of that benefit by the defendant, and (3) retention of
the benefit by the defendant under circumstances that make it inequitable for him to retain it
without paying its value.” Gignilliat v. Gignilliant, Savitz & Bettis, L.L.P., 385 S.C. 452, 467
(2009) (internal quotation omitted). “A party may be unjustly enriched when it has and retains
benefits or money which in justice and equity belong to another.” Inglese v. Beal, 403 S.C. 290,
297 (Ct. App. 2013) (quoting Dema v. Tenet Physician Servs. –Hilton Head, Inc., 383 S.C. 115,
123 (2009).
First, Defendants unquestionably conferred a benefit by Plaintiff because Defendants
received money directly for use in building their home. Second, Defendants realized the benefit
because they lived in the home. Third, it is inequitable for Defendants to retain the profit as the
monies were obtained by fraud and injured both the receivership entities and investors who lost
money as a result of the fraud. See Ashmore v. Cook, No. 3:13-1449-MBS, 2013 WL 6283508, at
*4 (D.S.C. Dec. 4, 2013) (“[I]t would be inequitable for Defendant to enjoy an advantage over
later investors sucked into the Ponzi scheme who were not so lucky.” (internal quotations
omitted)).
As for the damages amount pertaining to the unjust enrichment claim, the court finds there
is no dispute as to the $73,705.00 figure suggested by Plaintiff. As discussed in the Factual and
Procedural Background section, both Shawn Pressley and Whitfield admitted under sworn
testimony that the amounts which added up to the figure were accurate. If Plaintiff is willing to
accept a lower amount for damages than originally requested in the Complaint and his initial
Summary Judgment Motion ($135,000.00), the court will not stand in the way.
The second dispute in this matter is whether there is no genuine issue of material fact as to
Plaintiff’s request to transfer Flag Pole Acres from Defendants to Plaintiff. Pursuant to paragraph
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1 of the Receivership Order, entered most recently on October 29, 2015, Plaintiff has the right to
take control of real property in the possession of Wilson family members that was acquired with
AB&C funds. (ECF No. 53 at 8.) Plaintiff asserts that the 5.82 Flag Pole Acres were partially
acquired with funds from Henry & Crowder Family Limited Partnership. (Id.) Although Exhibit
D contains a check for $90,440.15, it is not clear to the court that this check was used to acquire
Flag Pole Acres. (ECF No. 53-4.)
Plaintiff also asserts that the remaining portion of Flag Pole Acres, if not purchased with
AB&C funds, was improved with funds that flowed from the AB&C Ponzi scheme. (ECF No. 53
at 8.) Although Plaintiff points to Exhibit E to show “invoices and checks to Whitfield Enterprises,
LLC for construction of the farm,” it does not make clear to the court what, if any, construction
was for Flag Pole Acres. (ECF No. 53-5.) Furthermore, there is a genuine material dispute as to
whether Flag Pole Acres is under control of the foreclosure action filed by the Bank, as it became
an essential addition to the two acres deeded to Defendants for their home (see n.3), or whether it
should be considered part of the Wilson Farm that is under control of Plaintiff. Defendants assert
that Flag Pole Acres was “included in all paperwork with the Bank” (ECF No. 56 at 4), while
Plaintiff asserts Flag Pole Acres is “not subject to the foreclosure action filed by the Bank” (ECF
No. 57 at 3). The court is unclear how the reformation of the deed between Plaintiff and the Bank
left Flag Pole Acres to be owned by Defendants and subject to Plaintiff’s claim.
Lastly, Defendants assert that because their home is in foreclosure, Plaintiff should seek
damages from the Bank, instead of them. Defendants’ logic is that “the money paid to Whitfield
for work performed on Defendants’ home flowed directly from Wilson to Whitfield, and is
contained in the wood, nails, and construction material in the part of the home worked upon by
Whitfield.” (ECF No. 60 at 2.) Defendants contend that “the only way to separate the parts of the
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house paid for by Wilson and those paid for by the loan from the Bank is through sale of the house.
Since the home is currently undergoing foreclosure and will be sold by the Bank, Plaintiff should
seek from the Bank, the mortgage holder, the actual damages arising from the part of construction
completed by Whitfield.” Id. If not, Defendants believe Plaintiff will have allowed the Bank to
receive “an unjust enrichment in that they profited from work paid for by Ponzi money.” Id. The
court finds that there is a dispute as to whether the $73,705.00 damages amount should come from
Defendants or the Bank since it is foreclosing on Defendants’ home.
Therefore, the court concludes that Defendants were unjustly enriched and the damages
amount is $73,705.00. However, there still remain genuine disputes of material fact as to (1)
whether Flag Pole Acres should be under control of the Bank’s foreclosure action or part of the
Wilson Farm that is under Plaintiff’s control, and (2) whether the $73,705.00 damages amount
should come from Defendants or the Bank after it forecloses on Defendants’ home.
V.
CONCLUSION
For the foregoing reasons, Plaintiff’s Motion for Summary Judgment (ECF No. 53) is
GRANTED IN PART as to the unjust enrichment claim and DENIED IN PART as to the
declaratory judgment action, and as to the person or entity responsible for payment of damages for
the unjust enrichment claim.
IT IS SO ORDERED.
United States District Judge
September 18, 2017
Columbia, South Carolina
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