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STRATUS BUILDING SOLUTIONS Racketeering (RICO) Complaint Document

December 23, 2012

(UnhappyFranchisee.Com)  Stratus Building Solutions unit franchise owners have filed suit against the embattled franchisor, its Master franchisees and executives alleging violations of the Racketeer Influenced and Corrupt Organizations Act (RICO).

See the press release here:  STRATUS BUILDING SOLUTIONS Sued by Franchisees for RICO Violations

Read the RICO petition here:  RICO complaint against Stratus Building Solutions (PDF)Petition

See all our related posts here:  Stratus Building Solutions

See the list of Defendants and an excerpt from the complaint below.

IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF MISSOURI

EASTERN DIVISION

JOSE TORRES, GUADALUPE CLEMENTE, LUZ WALKER, CHRISTINA BEITER, and ANTONIO  CARMONA,

Individually and on behalf of all others similarly situated others

Plaintiffs,

VS.

Defendants:

SIMPATICO, INC,STRATUS FRANCHISING, LLC

PETER FRESE, JR.

DENNIS JARRETT

CARMEN GARCIA

DAVID FARRELL

MARISA LATHER

ALEN SULJANOVIC

BOB STAPLETON

PHSCCH SBS, LLC

CHANNEN SMITH

LUPITA GALLEGO

ED NUNEZ

JASON DOWLING

GONZALO MORENO

PETAR VAVAN

MARK BASHFORTH

JAYSON BASHFORTH

AFSHIN CANGARLU

STEVAN R. BUTCHER

JIM PARELL

SAM VALDEZ

MARVIN ASHTON

CHRISTIAN SMITH

TABITHA GOODWIN

EVERT DURAN

JAMES VAN DYKE

JOSHUA FLETCHER

DEBORAH ELGAS

MERT SMITH

JITENDRA KAPUR

J. BECK,

ERIC BROTZ

JEFFREY B. AIBEL

DAVE BOUTWELL

KAREN AIBEL

SCOTT BROWN

ANNIE GONZALEZ

LLOYD STOREY

AARON KAHALOA

MALLY PORCH

ANGEL PASCUAL

LEONARD FAZIO

MICHAEL FAZIOAMY LUNDSTRUM

DEVANG KOTHARI

BILL BLAIR

KEVIN SPELLACY

ROBERT PERRY

KNUTSON/GOLDSMITH ENTERPRISES, LLC

GATOR GREENWILL

PAUL L. KNUTSON

LUIS MORALES

DENISE GUTIERREZ

PAMELLA MARTINS

JEREMY WHETSTINE

TAYLOR STINNETTE

JOSUE RANGEL

STEPHANIE MCDANIEL

SHAUN STECKLER

RINEA BLANCHARD

MIKE NAPOLITANO

ANTHONY NAPOLITANO

JOHN MCDONALD

LORENA ARISTIZABAL

TODD KNIGHT

JASON POTTS

BILL HOLDEN

TONY SMITS

MARIAM HERNANDEZ

BRANDON SMITS

CRAIG BALLARD

CHELLEY BAACK

JIM MORRISON

SHAWN VICK

ARISS ROGEL

D’ANDRE SALTER

SUNSHINE INVESTMENT GROUP, INC.

JEROME WILIAMS

DON GARTNER

ROB SALAZAR

DENNIS SNYDER

RICHARD M. BARAN

KEN CASSERI

CRAIG DONOVAN

MARK LINDAMANVINCE DUNSTON

ZEV BERGLAS

JOEL CRADDOCK

STEPHEN REED

GEORGE SHOAT

ADAM CASSERI

DEWAN BACHAI

MARRS, LLC

MARK STOCKER,

TERRY BEHRLE

TOM GRASSI

TIM TILTON

JON WHITE

JAY ZYTNICK,

KIMBERLY ZYTNICK

TOM WEISS

JOHN COLEMAN

BONNIE COLEMAN

RISA ANGELO

WILLIAM KING

KEVIN GASS

RALPH SIZEMORE

ANGELA CARMAN

DANNY GILLESPIE

DAVID SMITH

ED LEASE

GREG FISHMAN

TOM BAKER

DAWN CAUDILL

STEPHEN SHERIFF

TJM ASSOCIATES, INC

JACQUELYN MOSLEY

THOMAS MOSLEY

ELEAZAR QUINTANA

WILLIAM RAGSDALE

LORI SEALY

SYDDAR, Inc.

SHAUNA SHARPSTEEN

LUCERO FLORES

EMILY THOMAS

SHEA SEALY

CORDELL DEAN

Here is an excerpt/overview of the lawsuit against Stratus Building Solutions, its Master Franchisees and employees:

This is a class action brought by unit franchisees of the Stratus Building Solutions franchise system (“SBS”) arising from the illegal business scheme of SBS and its web of affiliated entities and individuals who control and operate the SBS franchise system (collectively, all the “Defendants”). Through this scheme, Defendants fraudulently induced Plaintiffs and the Class to purchase a cleaning franchise and thereafter exploited their control and economic power in order to extract exorbitant and unjustifiable payments and expenditures from their franchisees. As a result, Defendants reap grossly inflated sales and profits, creating an illusion of corporate growth and business prosperity while causing substantial, permanent, irreparable financial harm to the franchisees.
SBS’s illegal scheme consists of two primary components. First, SBS engages in a policy of fraudulently and deceptively inducing franchisees to purchase SBS franchises by intentionally misrepresenting the true nature of the contractual relationship as well as the financial prospects for the franchisee and their likelihood of success.

Second, SBS further takes advantage of its franchisees through other illegal, deceptive and fraudulent means, including but not limited to its willful practice of: (a) saturating geographic areas with more franchise than the area could reasonably support, (b) through grossly underpricing the service work to be provided by the franchisees, (c) through the deceptively churning the service accounts between the franchisees, and (d) charging illegal, undisclosed, inflated fees/charges to the franchisees in order to reduce the franchisees‟ income.

The fraudulent intent underlying SBS’s scheme of deceptively luring franchisees to participate in its system and therefore extracting payments, franchise fees, and cleaning contract income is demonstrated by its pattern of behavior when the inevitable franchise failures come to pass. In this manner, SBS suffers no loss. SBS executes the same scheme against the new franchisees to continue the illegal scheme of increasing revenues of the backs of those with no control.

Plaintiffs bring this action alleging violations of: (a) the Racketeer Influenced and Corrupt Organization (“RICO”) Act, 18 U.S.C. § 1962(c). Plaintiffs seek damages to remedy Defendants‟ unconscionable, fraudulent, and unlawful practices in connection with the operation of its franchise scheme.

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Tags: Stratus Building Solutions, Stratus Building Solutions franchise, Stratus Building Solutions RICO, Stratus Building Solutions lawsuits, Jon Fortman, Jonathan Fortman, Dennis Frese, Dennis Jarrett, janitorial franchise, commercial cleaning franchise, franchise fraud, franchise scams

Comments

8 Responses to “STRATUS BUILDING SOLUTIONS Racketeering (RICO) Complaint Document”

  1. Dave says:

    Does anyone know what the status of this is? Where can I go to be a part of the class action?

  2. stratus franchisee says:

    Not sure what the status is but contact the lawyer handling the lawsuit, his name is Jonathan Fortman @ 314-522-2312

  3. I work for this company and hate it. I’m forever working my ass off everyday for only $500 a month. They are scammers. I should be making $2500 a month. Yeah right!! They have taken a whopping $1200 from my check. Yep, $1200!! We need to put a stop to this company!!

  4. stratus tampa says:

    jeff in tampa is

    a racist playing with people’s accounts as high as where you want to not have enough money and accounts and want money, you never come to tampa buy because jeff is a crazy scammer

    es un racista juega con las cuentas de la gente hasta donde quiere pues no tiene suficientes cuentas y quiere dinero y dinero , nunca vengas comprar a tampa porque jeff es un loco estafador

  5. Reasoned Source says:

    @Viewers,

    It appears that Mr. Fortman indeed is a friend of the franchisee as he has filed an appeal of the ruling sent down from the Judge in regards to Arbitration….

    Seems like Good Ole DJ and Pete are in for another eight (8) month’s or so of wondering what is going to happen next!

    Must make those remaining (few remaining) Masters feel even more Value as they write that Check each and every month!

    Hear they are planning a HUGE Meeting (how can it be HUGE when less than 20 Masters technically remain in the system?) in California in the coming days to discuss the BOSS System that supposedly, according to Deposition, doesn’t exist!

    Just saying, its rough when things are part of a written record now isn’t it Pete?

    Seems like Tampa is having some issues filling books of business and is being accused on various blogs everyday….Wonder if there is an attorney currently allowed to practice in Florida willing to Step Up to the Plate just like Fortman has?

    Maybe a little prodding by Good Ole Reasoned Source could dig one up!

  6. Reasoned Source says:

    @Viewers, A founding member of REASONED SOURCE was asked recently, “What made this SCAM (Stratus) different then lets say Coverall, Jani-King, Jan-Pro has been accused of”? His response was as follows:

    “Most of the SCAM associated with the above listed companies was directed at the Unit Franchisee by making them feel like THEY had the potential AMERICAN DREAM at their fingertips, by making the cleaning industry seem like a PEARL awaiting to be cultivated by them”! In Stratus, you had a level of deception that has been described by others as MADOFF WITH A TWIST OF LIME! (Great Phrase)

    It was a Ponzi Scheme in the way it was established to Fraudulently induce investors and reap direct rewards to the Corporate Entity, in this case Dennis Jarrett and Pete Frese. However, unlike Madoff THEY brought in “third party validators” and “third party facilitators” to not only SHIELD them (Pete/DJ) but to make the False Story more believable in a way.

    Here you had two people (DJ and Pete) that had a record of working within the Commercial Cleaning Franchise field for over a decade. Both of them had held multiple Executive Level Positions, both had learned from the CROOKS OF THE PAST and both of them had seen that the REAL MONEY was in the Masters and the Royalty Fees associated with those Masters.

    Unlike Jan-Pro, Jani-King, Coverall the FRAUD was to sell the DREAM to the Potential Masters vs the Owner-Operators.

    That is how a company grew technically (somewhat of a lie) from Zero to 100 million plus per year in a relatively short/extraordinary time in our industry.

    The Fraud Foundation was directly laid by Dennis Jarrett and Pete Frese

    The Plan/Outline of the Fraud was presented by David Farrell, Marvin Ashton, Bill Blair and others.

    The Validation of the Plan/Outline was Validated by Ken Cassiri, Jeff Abel, Afshin Cangarlu, Mark Bashforth , Tom Weiss, John Coleman in exchange for %, One off deals, side deals and sales/marketing of goods deals (Miracle Pad, Nyco, Bio-Shield)

    The P/R, Legitimacy, Advertising of all the above was handled primarily by Marissa Lather.

    Similar to a Ponzi Scheme the Presenters, Validators and Public Relations were all rewarded in Cash, Bonus, % of take etc…in order to Entice Others that were not aware of the above and were not part of the TAKE!

    More coming on this interview as it will be in publication soon enough…….

    It is amazing to me the sheer STUPIDITY of Pete Frese, Dennis Jarrett and for that matter Matt Jacober/Lathrop and Gage as to think by signing people like Ken Cassiri, Jeff Abel, Jatendra, Julio, John and others to Non-Discloure paperwork that somehow there wasn’t a way for OTHERS to find out the terms of those contracts and the Documents by which allowed them to not only LEAVE Stratus Franchising, but to get PAYMENT as they were Leaving!

    Oh Well, it is Amazing to me that Matt Jacober still delusional in the belief that REASONED SOURCE is but one person!

  7. Same characters new Ponzi Schemes says:

    Same characters different Ponzi Schemes

  8. tampa Jeff Rat says:

    everyone knows that the money Jeff rat offers good money for the presidency of stratus for that reason they can steal the smile care of the above

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