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PALOS VERDES PENINSULA NEWS Saturday, June 20, 1998 OWNERS OF RE/MAX ROLLING HILLS MUST PAY $1.5 MILLION By Monica Nakamine News Staff Writer A Torrance jury awarded Palos Verdes Estates resident Roy Roberts and Redondo Beach resident Dennis Silver $1,475,000 last week in their stock fraud case against Lawrence Arman, Claudette Arman and RE/MAX Rolling Hills Realty. Silver and Roberts each purchased shares of stock from the now bankrupt United R.E.O. Services, Inc., owned by the Armans, which assisted banks in selling foreclosed properties. According to the plaintiffs' attorney, Gayle Eskridge, the couple and their company, RE/MAX Rolling Hills Realty, allegedly committed fraud in the sale of the United R.E.O. stock and were suspected of passing money from the R.E.O. account to their own personal accounts and to the RE/MAX Rolling Hills Realty account. Checks from the R.EO. account were made out to themselves, their daughter, as well as RE/MAX Rolling Hills Realty as reimbursement of expenses. Documentation that verified the nature of these transactions was never produced, as their lawyer, who has since been released from duty, never submitted them despite a court order. The Armans said that they were not aware that the court requested these documents and that their previous lawyer was not taking the proper action to submit them to the presiding judge and jury. "The bottom line is that the other attorney and the judge said it was too late to submit evidence," said Lawrence Arman. "But I don't think we should be the ones to suffer because of his incompetence." The Armans are now suing their former attorney in a $10-million malpractice suit for not being able to produce evidence on behalf of his clients. They have since hired another attorney; however, their new counsel will not be handling the lawsuit. Regarding the lawsuit that was imposed by Silver and Roberts, the Armans will also try to appeal the jury's decision to get what they consider a fair trial. "We are appealing the court to ask for a new trial," said Claudette Arman. "Normally, they don't allow that, but [the judge] might allow it and, if she does, we'll be able to submit our evidence and prove our innocence." According to Eskridge, Roberts and Silver pursued the litigation not only to recover the money, which they invested in United R.E.O. Services, Inc., but also to send a message to the Armans and anyone else who might be thinking of defrauding investors. "People need to know they can't get away with this," Eskridge said. "Thanks to this jury, at least some of them know that now. Hopefully, others who read this article will also get the message." Reprinted With Permission Of The Palos Verdes Penninsula News _________________________
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