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Dwayne B.
Dwayne B., Attorney
Category: Business Law
Satisfied Customers: 33759
Experience:  Practicing for over 20 years and helped a number of businesses with litigation.
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My group of private citizens invested in an entertainment

Customer Question

My group of private citizens invested in an entertainment venue to promote 6 concert tours featuring Anthony Hamilton,as the headliner, with Raheem DeVaughn, Avery Sunshine, and Chrisette Michele . The agreement was codified by a notarized agreement with specifications that we would invest $660,000 to promote 6 shows with a guaranteed return from the promoter and co-promoter of the $660,000 plus $50,000 per show ($300,000). The conditions involved the promoter providing the investors with a summary plan for each venue, clearance from the investors of any changes in the performers and reasonable assurance that the venue selected could yield the desired results and a guaranteed repayment of the initial outlay plus a fixed return of $50,000 per show.The first show was held in Huntsville, Ala with disappointing results. The second show in Albany, Ga. was a complete failure. The promoter reported that that show would not count. Instead another show would be added. The third show was held in Mobile , Ala and again with disappointing results and the fourth show in Cincinnati, Ohio, suffered the same fate as the previous shows.At this point, it was clearer that the promoter and his co promoter were unable to deliver, as they promised. So the Investor Group issued a Cease and Desist Order letter to the promoters. The letter indicated that the Investors wanted to terminate the provisions of the contract and requested that the remaining money, be returned ($294,000) covering two remaining shows and any profits from the previously promoted shows. In addition, we asked that the promoters provide a plan of action to repayment of the investment for the first four shows plus the guaranteed return.It has been over 3 months since the letter was issued and the promoters have not provided a plan -- In addition, they have advised us that after receiving the cease and desist letter, they used the remaining money to reserve space for events they wanted to plan to help get some of the $660,000 repaid. As such, nothing has been returned to the group.The question to you are what legal options do we have at this juncture. The terms for resolving difference in the agreement or the execution of the agreement provides for "mediation" But we feel that embezzlement and/or fraud may have been committed in that money was used for an unintended purpose after the issuance of the cease and desist letter.I am concerned about legal remedies (vice mediation), if possible and under what authorities -- We want to:1). Recover the funds for the two unexecuted shows which is at least total $210K.
2) Seek restitution for the four shows that were held, but fell below the mark.
Submitted: 1 year ago.
Category: Business Law
Expert:  Dwayne B. replied 1 year ago.

Hello and thank you for contacting us. This is Dwayne B. and I’m an expert here and looking forward to assisting you today. If at any point any of my answers aren’t clear please don’t hesitate to ask for clarification. Also, I can only answer the questions you specifically ask and based on the facts that you give so please be sure that you ask the questions you want to ask and provide all necessary facts. Please note: This is general information for educational purposes only and is not legal advice. No specific course of action is proposed herein, and no attorney-client relationship or privilege is formed by speaking to an expert on this site. By continuing, you confirm that you understand and agree to these terms.

I'm not sure what you mean by "under what authorities" and need to find out before I begin. Due to the time and expense of the case law databases, providing case law citations has to be done under an Additional Services request. However, usually people really don't need case law citations, they just want the basic law that underlies their situation.

If you are not requiring case law citations then I can assist with the question. If you are asking someone to do the case law research then I'll have to opt out and open it back up to he other experts because the expense is more than the value of the question.

Please let me know if you want me to continue based on this additional information I provided.

Customer: replied 1 year ago.
the statement by "what authorities" mean I am interested in what legal authorities or justifications can I use to pursue legal action. Are there any state or federal violations (i.e. embezzlement, fraud, etc...). Please continue... Thanks,
Expert:  Dwayne B. replied 1 year ago.


Can you attach that document in PDF format so I can view it online? You can open it in Word and then save it as a PDF and re-attach it. I downloaded a virus from someone's document last year and so don't download files any more .

Expert:  Dwayne B. replied 1 year ago.

Also, you mentioned a list of things they were supposed to provide (the promoter providing the investors with a summary plan for each venue, clearance from the investors of any changes in the performers and reasonable assurance that the venue selected could yield the desired results and a guaranteed repayment of the initial outlay plus a fixed return of $50,000 per show).

Which of these did they do and which ones did they fail to do?

Customer: replied 1 year ago.
I don't need case law. I would like advice thanks
Expert:  Dwayne B. replied 1 year ago.

Sure, I do need you to answer that last post I made.

Customer: replied 1 year ago.
The agreement indicates that the promoter would return the $660,000 plus $50,000 per show, The agreement did not require the promoter to provide reports -- this requirement came up during conference calls with the promoter, where he was asked to provide, after the first two shows failed, a copy of the expenses etc... The agreement has already been downloaded to your platform as an added file.
Expert:  Dwayne B. replied 1 year ago.

I'm not showing an attachment but maybe they will post it later and I can take a look.

It sounds like you have causes of action for breach of contract, probably fraud, and possibly negligence. However, breach of contract would probably be the best one to focus on. It allows you to recover your money plus attorney's fees. You can bring all of the causes of action in the same lawsuit and then at the end select whatever pays you the most.

Expert:  Dwayne B. replied 1 year ago.

There may be criminal actions as well. I've been thinking about this since you posted it. The fact that he/they took the money thy were supposed to pay you and used it for other events is probably criminal, although exactly what happened, the language use, etc. will affect all of that. You probably want to go ahead and report it to the police and let them look into it.

That brings up that there is another civil cause of action that may work in this case as well. It is "breach of a fiduciary duty". I'm not sure that they were "fiduciaries" to you but if they were then this applies.

A fiduciary is the highest legal duty in the law. It is even stronger than the parent child duty. Essentially they cannot do anything that isn't in your best interest.

Expert:  Dwayne B. replied 1 year ago.

I am about to sign off for the evening. However, I will be back online first thing tomorrow so feel free to ask any additional questions you have in this thread.

If your question has been answered then I'd offer my best wishes to you and ask that you please not forget to leave a Positive Rating so I receive credit for my work.

Of course, please feel free to ask any follow up questions in this thread. I want to be sure that all of your questions are answered. In addition, once you issue your Positive Rating the question will lock open and no longer time out so you can come back to it anytime in the future if you think of any follow ups.