‘We’re trying to get our money back,’ lawyer says of allegations in technology fraud lawsuit

A judge has denied a request to delay a multimillion-dollar lawsuit filed last year by the Bibb County school district while prosecutors pursue criminal charges related to allegations of money laundering and fraud stemming from technology purchases.

The school district’s suit alleges that former school Superintendent Romain Dallemand, Isaac Culver and his company, Progressive Consulting Technologies Inc.; former school technology director Tom Tourand; Comptech Computer Technologies Inc. and its president and CEO, Allen J. Stephen; and Pinnacle/CSG Inc. and its president, Cory McFarlane, participated in a series of fraudulent acts concerning 2012 transactions. Tourand died July 2.

A federal grand jury indicted Culver, Progressive Consulting Technlogies Inc., and Culver’s business partner, Dave Canty, on fraud charges last month stemming from the sale of 15,000 Ncomputing devices to the district that were delivered without necessary components to make them functional.

Robert Luskin, a lawyer representing Culver and his company, argued during a Tuesday hearing that his clients won’t be able to adequately defend themselves in the civil case without invoking their Fifth Amendment right against self-incrimination, which could also have a negative effect in the civil case.

Although the case is “document intensive,” Culver and Progressive wouldn’t have the ability to refute allegations against them, he said.

Tom Joyce, a lawyer representing the Bibb school system, said Progressive, as a corporate entity, doesn’t have the right to “plead the Fifth.”

Project managers and other Progressive employees, including Culver’s wife, who has worked as an administrative assistant, could be called to testify, Joyce said.

An attorney representing Pinnacle/CSG Inc. also argued in favor of the stay, expressing concern that more people or companies could be indicted.

Although a lawyer representing Dallemand attended the hearing, he didn’t weigh in on the issue. None of the defendants attended the hearing.

Citing several factors that affected his decision, Treadwell denied the request to stay the proceedings and instructed the lawyers to conduct depositions for Culver and Progressive within 60 days.

After the hearing, school board member Lester Miller said he’s “very satisfied that the case will move forward” as a result of the judge’s denying the request for a stay.

“We’ve reached that point where in the days coming that we’re going to find out the truth of what happened back in 2012,” he said.

‘Attorneys’ eyes only’

The school district has subpoenaed more than six years’ worth of banking records from Bank of America, including records for Culver’s wife, Sheila Culver, according to a motion and legal brief filed by Culver’s legal team on Monday.

The district has also requested records from accounts at Wells Fargo, Capital City Bank and Renasant Bank, including accounts for Progressive Property Management LLC and Castlegate Holdings LLC, companies not included in the lawsuit, according to the brief.

Elissa Haynes, another of Culver’s lawyers, asked the judge to impose restrictions on the records to protect the records of Culver’s wife and companies not included in the suit, designating them as “attorneys’-eyes-only information.”

In a brief, she contended that there’s “no legitimate or reasonable explanation” for how the school district “would be prejudiced” if attorneys were barred from sharing the records with the school district or school board members.

In court Tuesday, she argued that school board members shouldn’t be allowed to see how much Culver’s wife spent at the grocery store, for example, or information related to other private purchases.

“There’s a strong need for protection here,” Haynes said.

Joyce countered that evidence has shown that others not included in the lawsuit may have shared in the proceeds of the alleged fraud and new defendants could be added to the suit.

He said the school district’s lawyers need to investigate Progressive’s payments to 16 people or entities that are included in subpoenaed bank records.

If the school district’s lawyers are barred from talking about the bank records with their clients, the district won’t be able to decide whether to sue other people, understand the “value of the case,” understand the status of the litigation and make other decisions about the case, Joyce said.

He said his clients aren’t looking to see such things as cellphone, mortgage and car payments.

“We’re trying to get our money back,” he said. “We can’t do that if we can’t follow the money.”

Treadwell ruled that bank records for people and entities that aren’t defendants to the suit will be designated for “attorneys’-eyes-only” while Progressive’s records will be placed in a less restrictive confidential category.

This story was originally published July 18, 2017 at 12:17 PM with the headline "‘We’re trying to get our money back,’ lawyer says of allegations in technology fraud lawsuit."