The Fair Finance Co. bankruptcy trustee has settled a lawsuit that has brought in nearly $371,000 to the Akron company's estate.
Indiana lawyer Stephen E. Plopper, former secretary of Fair Holdings, the Ohio corporate parent of Fair Finance, has paid back $370,999.96 he agreed he owed, the legal counsel for trustee Brian Bash said. The proposed settlement was filed Wednesday in U.S. Bankruptcy Court in Akron.
Bash in February sued Plopper and Plopper's wife, Linda, saying they signed a promissory note in October 2003 to borrow $250,000 from DC Investments LLC, the Indiana corporate parent of Fair. The suit said the Ploppers never repaid the loan and needed to pay back the principal as well as interest totaling more than $370,000.
''He [Plopper] responded very promptly,'' said Kelly Burgan, legal counsel for Bash. ''He was very cooperative.''
Plopper acknowledged the obligation to repay the money and made good on it, Burgan said. While the money is in hand, the settlement is still subject to bankruptcy court approval, Burgan said.
Additional lawsuits will be filed against other people who the trustee believes need to repay money borrowed through Fair Finance, Burgan said. Bash is also pressuring Indiana politicians, including Gov. Mitch Daniels, to pay back political donations he says were made with Fair Finance money.
The money recovered so far will be used to pay for the Chapter 7 bankruptcy expenses, Burgan said. Not enough money has been recovered to distribute to creditors who include investment certificate holders, she said.
''We're not going to make a distribution until there is a total that makes sense,'' she said.
In a recent post on the trustee's Fair Finance website, Bash wrote, ''I cannot be certain that there will be any recovery, and I would be very surprised if the recovery approached twenty-five percent.''
The two co-owners of Fair Finance and the company's chief financial officer were indicted and arrested on criminal charges earlier this month that allege the three defrauded about 5,300 Ohio residents and organizations out of more than $200 million. The people and organizations purchased uninsured investment certificates from the long-standing Akron company.
Indiana businessmen Timothy Durham and James Cochran bought Fair Finance in 2002 and hired former Akron-area accountant Rick Snow to be chief financial officer of their related companies.
Durham, chief executive of comedy movie maker National Lampoon Inc., was arrested in Los Angeles, where he has been living. He is scheduled to appear April 6 in federal court in Indianapolis.
According to Indiana press reports, Durham's former wife and father-in-law agreed to post $1 million bond for Durham. Cochran and Snow were released under house arrest that includes electronic monitoring.
Jim Mackinnon can be reached at 330-996-3544 or firstname.lastname@example.org.