Representative Cases

Several Kentucky farmers have filed a class-action lawsuit against a leading tobacco merchant.

It is obvious the citizens of Independence have a strong leadership team and I look forward to working with them and council.

Since 1984, the Northern Kentucky Bar Association (NKBA) has become an integral part of the Northern Kentucky community.

Lawsuits against Kenton dismissed

Lawsuits against Kenton dismissed
Cincinnati Enquirer - Cincinnati, Ohio
Ohio, June 28, 2000

By Cindy Schroeder

COVINGTON - Two open-records lawsuits filed against Kenton County have been dismissed, Kenton County Deputy Judge-executive Scott Kimmich announced Tuesday.

In one case, Elsmere resident Terry Whittaker had argued that a $15 copying fee for a black and white copy of a 36-by-42-inch map was excessive.

Ms. Whittaker also claimed the county would only fulfill open-records' requests by sending copies through the mail, rather than allowing someone to inspect the records first, then decide which should be copied.

In both cases, an assistant to the Kentucky attorney general upheld Ms. Whittaker's claims in March, and she later filed suit in Kenton Circuit Court.

However, in an agreement approved by both sides Monday, Ms. Whittaker dismissed her claim that the records were willfully withheld.

As part of the settlement, the county agreed to pay $55, half the cost of filing fees paid by Ms. Whittaker, and $12 for the disputed charges for the reproduction of the map.

Mr. Kimmich said it would have cost Kenton County taxpayers "significantly more than $67 to litigate (the) case." Because Ms. Whittaker acknowledged the fiscal court had not withheld the documents, she said "it seemed inappropriate" to use taxpayers' money to fight it.

Ms. Whittaker praised Mr. Kimmich and Brandon Voelker, the assistant Kenton County attorney who serves as the county's records custodian, for working with her to resolve her dispute.

Ms. Whittaker said she had been seeking the records to confirm the validity of information in jail consultants' reports about the location of a new jail, "not to get fiscal court."

In an unrelated case, county officials said Fort Mitchell resident John Ellenbogen plans to refile his request for records, after the Kentucky attorney general ruled that Mr. Ellenbogen's open-records' requests for invoices for computers, software, and related materials dating to 1993, were improperly filed.

Group sues gypsum plant 2nd time

Group sues gypsum plant 2nd time
Cincinnati Enquirer - Cincinnati, Ohio
August 18, 2001

By Terry Flynn

Private council meetings void permits, residents say

SILVER GROVE - A group of citizens upset over gypsum dust filtering into their homes on Ky. 8 has filed a second lawsuit against the Lafarge Gypsum Co. plant and the city of Silver Grove in an attempt to revoke the plant's zoning permit.

Attorney Brandon Voelker represents several Silver Grove residents who live across the street from the nation's largest drywall plant, near the Ohio River. He filed the action Friday in Campbell Circuit Court, charging that the city conducted illegal meetings to amend a zoning ordinance.

Named in the suit are the city of Silver Grove, Mayor Carl Schwarber, City Clerk Kay Wright, the Campbell County Municipal Planning and Zoning Commission, Lafarge Corp. and Cardinal Engineering.

A civil complaint against Lafarge, filed this spring by Mr. Voelker for the same clients, claims the company permitted the gypsum dust to blow across Ky. 8 and cause property damage and health hazards. That suit is pending in Campbell Circuit Court.

Justin Verst, who is the Campbell County attorney and the city attorney for Silver Grove, said Friday he could not comment on the suit because he had not seen a copy of it.

Attorney William Robinson, who represents Lafarge, also said he could not comment until he had the opportunity to study the suit.

The suit alleges the city council held special meetings Jan. 12-13, 2000, and conducted first and second readings on an ordinance amending the city's zoning ordinance to permit manufacturing on the property where Lafarge was to build its plant. The property was not previously zoned for manufacturing.

The suit claims the city did not make adequate notice of the meetings to permit public comment on the proposed amendment, and therefore the meetings were illegal under requirements of the Kentucky Revised Statutes.

"The city wanted Lafarge to build the plant, and they weren't concerned whether the citizens were informed as to exactly what the plant would bring with it," Mr. Voelker said.

The Lafarge plant, which employs 100 people, officially opened in July 2000. It is owned by the Lafarge Group, a French company that is the largest manufacturer of building materials in the world.

The suit asks that the ordinance amending the zoning regulations be declared null and void, that the city and its officials be enjoined from further violations, and that the plaintiffs be awarded unspecified compensatory damages.

Lafarge also must deal with a series of air pollution violations brought by the Division of Air Quality of the Kentucky Natural Resources and Environmental Protection Cabinet. The company is accused of permitting gypsum dust to escape from its property, and of not supplying the proper information for its state permits.

Erpenbeck suit status ruling due -- Judge to decide June 10 if case will be class action

Erpenbeck suit status ruling due - Judge to decide June 10 if case will be class action
The Cincinnati Enquirer
May 29, 2002

By Patrick Crowley

BURLINGTON - June 10 could be a definitive day in the Erpenbeck banking scandal.

That is when Boone Circuit Judge Jay Bamberger said he will decide whether the 209 homeowners caught up in the fiasco are brought together in a class-action suit against Peoples Bank of Northern Kentucky.

"We have started a move toward resolution," said Cincinnati lawyer Stan Chesley, who filed the suit along with Covington lawyer Brandon Voelker.

The suit was filed on behalf of Charles and Sherry Mitchell, an Independence couple who bought an Erpenbeck home and then discovered that the first mortgage on the property had never been paid off by the builder, Erpenbeck Co.

As many as 209 buyers of Erpenbeck homes are believed to be in a similar situation. Mr. Chesley and Mr. Voelker want to bring all the homeowners together in the class-action suit, which accuses Peoples of "fraud, negligence and unlawful" cashing of checks.

The FBI and federal banking regulators are investigating the Erpenbeck Co. and its founder and former president, A. William "Bill" Erpenbeck, over allegations of bank fraud.

During a hearing Tuesday, Judge Bamberger also ordered Peoples' lawyers to produce specific information June 10 about millions of dollars in cash and checks paid at property closings and then allegedly diverted into Erpenbeck Co. accounts at Peoples Bank.

Though Peoples Bank officials have said they think that about $25 million in cash and checks was diverted by the Erpenbeck Co., an Edgewood-based house builder, there has never been a full disclosure about the details of all 209 transactions.

John Bush, a lawyer representing Peoples Bank, said that information might be difficult for the bank to assemble.

"We don't have the grasp on what that total number is," Mr. Bush said. "We don't have all the loan files; some are with the closing agents."

Judge Bamberger told Mr. Bush to have either the details of the transactions or a reasonable explanation of why the information is not available to the bank.

Mr. Chesley scoffed at the notion that the bank does not have all the details about the transactions.

"I bet that's not what they told the banking regulators," he said.

Family faces loss of home, savings - Immigrants lose faith in honesty of business people

Family faces loss of home, savings - Immigrants lose faith in honesty of businesspeople
The Cincinnati Enquirer
June 22, 2002By Karen Samples Gutierrez

RICHWOOD - They are by turns angry, incredulous, uncertain and calm.

Yes, a bank has just sued Marlene and Miguel de los Reyes to force the sale of their home. But surely they won't lose everything - shelter, savings, credit rating - because of the unscrupulous behavior of businesspeople they don't even know.

"Maybe I'm naive, but I just can't think of us being innocent and being put out in the street," says Mrs. de los Reyes, 45.

She and her husband, along with two other couples in the Steeplechase subdivision in Boone County, are the first to face foreclosure proceedings in fallout from the Erpenbeck scandal.

They purchased their home from an Erpenbeck company, Erpenbeck & Kennedy Builders, with the understanding that part of their money would be used to pay off construction loans taken out by Erpenbeck. But that didn't happen. Instead, the Erpenbeck company deposited the money into its own accounts at Peoples Bank.

Millions of dollars in checks written to lending agencies were diverted this way, and about 220 homeowners are now discovering liens on their property. Most lenders are waiting to see what agreement will be reached between Peoples and title companies to assist the homeowners. But one bank, Cincinnati-based Guardian Savings, is moving ahead.

"I think it's a low blow," says Miguel "Mike" de los Reyes, 46. "They know the situation the 222 homeowners are in. They say they want their money. Why didn't they tell that to Erpenbeck a year ago? They're going to pick on the little guy?"

Erpenbeck owes Guardian a total of about $510,000 on three homes in Steeplechase, the bank claims. It wants the homes sold and the proceeds used to pay off Guardian first.

Guardian president Rick Burkhart declined to comment.

The de los Reyeses paid $216,000 for their home in 2000. Guardian is demanding $157,800. Selling the home won't bring enough to pay off Guardian and the couple's mortgage company, much less allow them to recover their $60,000 down payment.

That money represents savings from years of living within their means. They have built equity in previous homes, driven the same cars for years and paid off credit cards at the end of each month.

Marlene and Miguel de los Reyes are Cuban immigrants who met as teenagers while working in the same Kroger store in Miami. They have two children, Vanessa, 20, and Gabriel, 16.

Mr. de los Reyes is a manager at Dynamec, a Walton company that makes car seats. When the family moved to Boone County in 2000, he fell in love with the Steeplechase subdivision, where the homeowners' association enforces rules that help maintain property values, he says.

Vanessa is enrolled at Northern Kentucky University, and Gabriel loves Ryle High School, his mother says. But now the family's dream is turning sour. Never again, they say, will they trust the officials involved in real estate.

The couple is represented by attorney Brandon Voelker, who also has filed, along with attorney Stan Chesley, a class-action lawsuit against Peoples Bank.

Peoples allowed Erpenbeck to deposit checks made out to other companies, the lawyers say, so they want Peoples to pay off the homeowners' old mortgages.

On July 5, Boone County Circuit Judge Jay Bamberger will hear arguments in that case as well as discuss the foreclosures, Mr. Voelker says. He's hoping that through the class-action suit, the de los Reyes family will be able to keep their home.

"As you get older, you don't get attached to material things anymore," Mrs. de los Reyes says. "If we have to walk out tomorrow, I don't have a problem with that. I just don't want to lose the money we've saved for 22 years."

Peoples asks judge to release home liens

Peoples asks judge to release home liens
The Cincinnati Enquirer
June 28, 2002By Patrick Crowley

BURLINGTON - Peoples Bank of Northern Kentucky has asked a judge to protect homeowners stung in the Erpenbeck scandal from losing their homes by foreclosure.

In a lengthy brief filed late Thursday afternoon, lawyers for the Crestview Hills-based bank asked Boone County Circuit Court Judge Jay Bamberger to release first mortgage liens on 211 Greater Cincinnati homes built and sold by the Erpenbeck Co.

Employees at the Erpenbeck Co. diverted $24 million in checks and cash into its accounts at Peoples Bank, according to court documents, resulting in liens on the homes. The money was supposed to pay off the construction loans.

"This plan will take care of the homeowners ... and protect them from the possibility of foreclosure," said Louisville lawyer Ivan Diamond, who represents Peoples Bank.

Most banks involved have indicated that homes will not be foreclosed on while the case is being worked out. But two weeks ago, Guardian Savings Bank foreclosed on three homes in Boone County.

Peoples' new brief requests that Judge Bamberger prevent Guardian from moving forward.

After the liens are removed, Peoples and the other banks and title companies involved in the case would determine responsibility for the money diverted by the Erpenbeck Co., Mr. Diamond said.

All 211 homeowners are represented in a class action lawsuit filed by Cincinnati lawyer Stan Chesley and Covington lawyer Brandon Voelker. They have previously asked Judge Bamberger to have Peoples make good on the diverted checks and then go back and work out how much the various banks and title companies should pay.

"Our goal has been to get the mortgages released," said Mr. Voelker, who had not seen the brief as of early Thursday evening.

Customers Sue Hebron Auto

Customers sue Hebron Auto
Cincinnati Enquirer - Cincinnati, Ohio
February 2, 2006By James Pilcher

Ask class action; scores of buyers possibly affected

BURLINGTON - Former customers of Hebron Auto Sales Wednesday filed suit against the dealership, claiming the company defrauded them out of titles to the cars they bought.

The president of the company was found dead last week of an apparent suicide.

The suit, filed in Boone County Circuit Court on behalf of Vince and Jessica Childers of Hebron, said at least 59 customers could have been affected by the company's actions.

In the suit, Covington-based lawyer Brandon Voelker charged the company was selling cars to customers without clearing the titles from previous lienholders.

The suit asks to be certified as a class action, meaning even more potential plaintiffs could join and one settlement could be divided among all plaintiffs.

Local FBI officials said they also are investigating the financial scandal.

The lawsuit names Hebron Auto Sales' officers, including president Shelby Kent, who apparently shot himself to death in Big Bone Lick State Park last Thursday, a day before the opening hearing on a Fifth Third Bank lawsuit against the company.

Lawyers for Hebron vice president Blane Reese did not return phone messages; neither did Donald Ruberg, who is listed as company secretary on state documents. Ruberg has previously denied having anything to do with the company.

Also named is Credit Acceptance Corp. of Southfield, Mich., a Hebron Auto Sales creditor. No one answered calls at that office Wednesday.

"Somehow, Hebron was given advance monies to buy new cars at auction before they could prove they had cleared the titles," Voelker charged.

"That's why we're going after the creditors as well, because if they had followed their own dealer servicing agreement, none of this would have happened. Why lend money for a car unless you can prove you have clear title?"

Hebron Auto Sales closed its three locations in Richwood, Colerain Township and Middletown last month. Boone County Sheriff officials say at least 70 former customers have told investigators they have not received a title for their vehicles.

The suit filed Wednesday asks for customers' vehicle titles to be cleared by the defendants, as well as unspecified punitive and incidental damages. If the titles can't be cleared, the suit asks that customers' original trade-in vehicles or down payments be returned - but that may be impossible since the company may have sold off those original trade-ins, Voelker said.

Fifth Third Bank's suit claims the company owes it $4 million in unpaid loans and overdrawn checking accounts.

In the Fifth Third case, the court appointed Martin Huelsmann receiver, meaning he is now in charge of putting Hebron Auto Sales' affairs in order and either running it or liquidating it.

Huelsmann, former head of the Kentucky Public Services Commission, said Wednesday that he is working with local law enforcement and county clerks to examine documents and clear as many titles as possible.

He said local officials have been able to give clear ownership to some Hebron customers. But Huelsmann wasn't sure how many had been settled, or how many more cases remained unresolved.

"We're clearing them as fast as we can but there are no employees left who know what's going on, so there is no one there to tell us what to do or who gets what," Huelsmann said. "It's a very difficult situation."

Cold Springs Sues League of Cities

Cold Spring sues League of Cities
Kentucky Enquirer - Community Press & Recorder
April 14, 2010

By Amanda Van Benschoten

COLD SPRING - The city of Cold Spring has filed a class action lawsuit against the Kentucky League of Cities, alleging the group breached its fiduciary duty to member cities and asking its board of directors to reclaim hundreds of thousands in misspent funds.

The lawsuit was filed Wednesday in Fayette Circuit Court in Lexington and seeks class-action status.

It concerns the league's spending excesses from about July 2006 to June 2009, when the State Auditor found the group misused hundreds of thousands of dollars due chiefly to lax oversight.

In addition to lavish travel and meals, the auditor found the league paid exorbitant salaries and retirement bonuses and its staff engaged in conflicts of interest.

Cold Spring City Attorney Brandon Voelker called the league's activities "pure, unfettered greed.

"Had any of this happened in any city, people would have been indicted for a misuse of public funds," he said.

Cold Spring Mayor Mark Stoeber said the league's board of directors "simply did not fulfill their responsibility.

"Through their abdication of responsibility, the board allowed the Kentucky League of Cities to spend multi-millions of taxpayers' dollars in an unlawful manner," Stoeber said in a statement. "The taxpayer dollars wasted were not only hard earned monies from Cold Spring residents, but also from hard working taxpayers across the entire state of Kentucky, thus the petition for class action status."

A spokeswoman for the league said Wednesday that the group had not yet seen the lawsuit, so she couldn't comment on it.

Florence Mayor Diane Whalen, who was named to the league's board of directors last fall, after the spending excesses occurred, also declined comment because she had not read the lawsuit.

Northern Kentucky cities have been outspoken in their criticism of the league, to which they pay annual dues and fees for services such as insurance and training.

During the past six months the group has cut back on league-issued credit cards, adopted rules for travel, gifts and expenses, and adopted an ethics policy.

But local officials have said the reforms don't go far enough, and several cities, including Cold Spring, have withheld their dues until further reforms are made.

A week ago, Gov. Steve Beshear signed a bill to require more transparency and accountability of the league.

Attorney General Jack Conway also announced this week that his office is investigating the league.

Northern Kentucky Sues KLC

Northern Kentucky city sues KLC
Lexington Herald-Leader
April 15, 2010

By Linda B. Blackford

The city of Cold Spring is suing the Kentucky League of Cities in a class action lawsuit to recoup money that was spent by the group on expenses, high salaries and loans to employees.

"Through their abdication of responsibility, the board of directors allowed the Kentucky League of Cities to spend multimillions of taxpayers' dollars in an unlawful manner," Cold Spring Mayor Mark Stoeber said in a news release.

"The taxpayer dollars wasted were not only hard earned monies from Cold Spring residents, but also from hard-working taxpayers across the entire state of Kentucky, thus the petition for class action status."

Named in the suit are former executive director Sylvia Lovely, who resigned last summer after a series of stories in the Herald-Leader detailed hundreds of thousands of dollars in expenses at the League; deputy director Neil Hackworth; and insurance services director William Hackworth.

A state audit also found numerous conflicts of interest and questionable bonus practices.

The League is a membership organization that provides insurance and financing services to cities around Kentucky.

In a phone interview, Stoeber said he estimated Cold Spring had spent $1 million in the past 10 years on League membership and insurance premiums. He would like that returned.

"The main purpose of the suit is to tell the board to act as a board and get the monies back, and if you don't want to, we will," he said.

Brandon Voelker, city attorney for the Northern Kentucky city, compared the suit to a shareholder derivative suit in which shareholders ask that money misused by executives be returned to shareholders.

"They shouldn't have jacked up insurance rates all those years when they had so much money; they should have returned it to cities," he said.

The suit was filed in Fayette Circuit Court; Voelker said he hopes other cities will join it.

League officials declined to comment Wednesday.

On Tuesday, Attorney General Jack Conway said his office is investigating possible criminal activity at the League based on the state audit.

Voelker said he would like to see money returned to cities or "put back into the League coffers so the entity is more sound than it was before."

Crittenden, Corinth join KLC lawsuit

Crittenden, Corinth join KLC lawsuit
Grant County News
May 15, 2010

By Bryan Marshall, staff writer

Two Grant County cities recently decided to join a class action lawsuit filed against the Kentucky League of Cities.

The lawsuit, filed by attorney Brandon Voelker on behalf of the city of Cold Spring, alleges "financial improprieties," including unauthorized financial benefits, altered compensation without board approval, direct conflicts of interests involving expenditures and breach of fiduciary duties by KLC.

The claims stem from spending excesses from July 2006 to June 2009 brought to light by the state auditor's office.

For more information about this story, please pick up a print copy of Thursday's Grant County News.

Newport Schools Make Changes

Newport schools make changes
Kentucky Enquirer - Community Press and Recorder
July 9, 2010By William Croyle

NEWPORT - Newport Independent Schools' board of education voted last year to restructure the district for the 2010-11 year.

That new look is now taking shape with the pending sale of the Mildred Dean Elementary School building, two new principals, new school names and some remodeling.

The district has accepted a $1.9 million offer from St. Elizabeth Healthcare for Mildred Dean. The school, which closed in June, is about 40,000 square feet and on nearly 14 acres. The site is just east of Interstate 471, borders Fort Thomas and has views of the Cincinnati skyline.

The property was appraised at $1.5 million. In April, Superintendent Michael Brandt called that the "starting point" for bids.

"In today's market, I think getting $400,000 over the appraisal is pretty good," Brandt said on Friday.

The closing on the property could come by the end of the month, said school board attorney Brandon Voelker. The bid, he said, has a few conditions, such as a couple surveys to be done on the land.

"Once St. Elizabeth has that and is satisfied, we should be able to approve it," Voelker said. The sale will also have to be approved by the Kentucky Board of Education.

Guy Karrick, spokesman for St. Elizabeth, said there are no definitive plans for the property at this time. However, one consideration is constructing a two-story medical or professional office building. He said there is also the potential to build a road from that property to St. Elizabeth Fort Thomas, which is the old St. Luke Hospital.

Voelker said there was another bid on the property from a developer. The St. Elizabeth bid was more appealing, he said, because the land would not need to be rezoned.

Brandt said the school board will decide what should be done with the money after closing. It will get the district off the state's financial watch list, which it has been on since 2009 when its contingency fund fell below the 2 percent minimum required by law.

"When we close, the board will ask for a plan on how invest it," Brandt said. "We will not just spend it away."

Enrollment in the district has dropped from 3,000 students in 1990 to 2,000 today, which led to the restructuring. The remaining four schools have been reconfigured in the following manner: A.D. Owens Elementary School from grades K-5 to K-3; Fourth Street Elementary School from grades K-5 to 4-6; Newport Middle School from grades 6-8 to 7-9; and Newport High School from grades 9-12 to 10-12.

For consistency, the district renamed A.D. Owens to Newport Primary School, and Fourth Street is now Newport Intermediate School. New principals have also been hired at both.

Steve Brokamp, former principal at Mariemont (Ohio) Elementary School, will take over at Newport Primary. Newport Intermediate will be led by Josh Jackson, who was hired from Ludlow Elementary School.

Brandt said food service equipment has been added at Newport Primary, Newport Intermediate is remodeling a room to host preschool and Newport High School is remodeling space for its new child care center for students with children. Brandt said the child care center is expected to be ready in October.

Lawsuit Challenges Library's Tax Rate

Lawsuit challenges library's tax rate
January 19, 2012By Chris Mayhew

COLD SPRING A class action lawsuit has been filed against the Campbell County Public Library seeking to invalidate and roll back the library's tax rate back to 1978 levels.

Attorney Brandon Voelker filed the class action lawsuit in Campbell Circuit Court Thursday, Jan. 19 against the library on behalf of Charlie Coleman of Alexandria, and Cold Spring area residents John P. Roth Jr. and Erik Hermes.

The suit alleges the library's Board of Trustees has failed follow Kentucky law pertaining to library districts by not obtaining petitions from 51 percent of the voters from the last general election granting permission to increase the property tax rate.

The suit is requesting a "refund of unlawfully charged and collected ad valorem taxes," and for a court injunction to prohibit any future "unlawful tax increases." The suit seeks to invalidate all library property tax increases beyond the amount of 30 cents per $1,000 of assessed property value authorized by a petition approved by voters in the 1978.

According to the suit, Campbell County property taxpayers are owed a refund of about $2.218 million "for the year 2010 alone."

The suit alleges the library's tax rate of 72 cents per $1,000 of assessed property value is illegal, and that the library should only have taxed property owners at the rate of 30 cents per $1,000 of assessed property value.