Court order in class action case compels Aaron Brown to provide full details of Kimmage defence fund
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Saturday, February 01, 2014

Court order in class action case compels Aaron Brown to provide full details of Kimmage defence fund

by Shane Stokes at 7:24 PM EST   comments
Categories: Pro Cycling, Interviews
 
Massachusetts judge wants reassurances fund is intact; could demand money is transferred to neutral third party

Aaron BrownFurther to the news that Hein Verbruggen and Pat McQuaid have reactivated their court case against the journalist Paul Kimmage, VeloNation has received confirmation that Aaron Brown, who took possession of Kimmage’s legal defence fund, has three weeks to provide full details of the current status of that fund to an American court.

A class action lawsuit has been filed against Brown [right], who was previously involved in one of the websites which set up the fund to help Kimmage in his defence against the Verbruggen/McQuaid defamation suit.

In April of last year it emerged that Brown had transferred the fund out of the PayPal account that originally housed it, and that he was refusing to turn it over to Kimmage or to a neutral third party.

Bill Hue, a Wisconsin circuit court judge, cyclist and donor to the fund, took a class action lawsuit against Brown on behalf of the donors. Things are now moving forward and Brown now must provide proof that the fund is intact.

“The court has jurisdiction over Aaron Brown,” stated Hue to VeloNation. “He has the money, or at least he says he does. Once I was appointed by the court to represent the class and once Aaron said that he was going to redistribute the money on his own [via a refund site], I asked the court to take control of that so that we could make sure that everything was fair and transparent.

“The court did order that and Aaron has to give an accounting to the court.”

The action against Kimmage began in January 2012 when McQuaid and Verbruggen initiated legal proceedings against him, claiming they were defamed by articles in the Sunday Times and L’Equipe. He was issued with a summons on September 19th of that year, compelling him to attend a trial in Switzerland on December 12th 2012.

Out of work and therefore lacking the financial means to defend himself, a fund for Kimmage was set up by the NYVelocity and Cyclismas websites to try to raise legal backing for him. That campaign was a big success, with a total of over $90,000 being donated by cycling fans and supporters.

On October 26th 2012, days after it received and accepted USADA’s reasoned decision on Lance Armstrong and the US Postal Service team, the UCI announced that it was putting the case on hold.

That action was however only suspended, not definitively ended. Despite that, Brown refused to turn the funds over to a neutral third party, and instead claimed that he believed Kimmage would not need it.

He justified his position by saying that he needed to retain the funds because he was involved in a legal dispute with Lesli Cohen, who co-founded Cyclismas with him. He also claimed that he was facing a potential tax liability for the money which had been donated due to an error in the way the fund was set up.

Kimmage was furious, saying that he had no right to take the fund. He was clear that he felt betrayed by Brown, who had built up a prominent profile via his @UCI_Overlord Twitter account plus interactions with people in the industry, and who had stayed in Kimmage’s home when he visited Ireland shortly before.

Refunds now blocked by court:

Although McQuaid and Verbruggen never officially ended their case – and have now restarted it – Brown said several months ago that he was inviting those who donated to the fund to apply to him for a refund. He said that he would give back 70% of the donated amount.

Cohen and Hue cautioned people against this, saying that the class action route was the only guaranteed way to ensure that money was indeed returned.

On January 30th the trial court in Worcester, Massachusetts issued an order making clear that Brown could not continue to seek applications for a refund.

“It is hereby ordered that defendants Aaron Brown and Siroque Holdings Inc. are hereby enjoined and prohibited from disbursing any funds whatsoever from the Paul Kimmage Defence Fund for any purpose until further order of this court, and this paragraph of the order shall be deemed effective from January 16th 2014, when it was issued from the bench,” it stated in the legal document.

It also said that the defendants [i.e., Brown and his Siroque Holdings company] needed to provide Cohen and Hue with full bank details of where the fund is held by February 25th. He also needs to provide a full accounting of the fund, including all withdrawals.

In turn, Cohen needs to provide the defendants with a list ‘containing what she understands to be the date and amount of each contribution to the Paul Kimmage Defence fund.’ The defendants then have fourteen days to either agree that list is accurate, or outline and prove any disagreements to that.

Bill HueAsked if Brown has indicated if he will follow the court’s order or not, Hue [pictured] said it was thus unclear. “His lawyer says that he will do that, but he really hasn’t done anything in the lawsuit to this point. So we will just have to wait and see if he will do that.”

According to both Hue and Cohen, Brown’s lawyer has had difficulties in dealing with him and has asked the judge to be released from working with her client.

“His lawyer has had difficulty communicating with him and has had some difficulty controlling him, so to speak, because he is so far away,” said Hue. “He chooses to communicate with her when he chooses to.

“She has asked the judge to quit as his legal counsel. But the judge said to her that she has to stay on the case. If he lost her, he wouldn’t have anybody from Aaron’s side to respond to him.”

Asked what he believed would happen if Brown didn’t provide an accounting within the specified time, Hue said that he felt the consequences could be serious.

“It would be my opinion that if he intentionally violates a court order, he would in contempt of court. And there are lots of remedies for that. So the court would have to choose a remedy.”

He said that one possible outcome would be a jail sentence. While Brown is believed to be in Europe, Hue said that if such a decision was made by the judge, that he would be picked up by immigration if he tried to enter the country again.

“My impression of the judge is that he is a very serious man who very seriously believes that somebody should follow his orders,” Hue added.

If Brown does comply and provides an accounting, he explained what the next step could be. “Right now the court is just asking him to show the court that he has the money. If he has the money and the court is in control, they could have him send the money to the court.

“They could also ask him to send it to a third party; that would be costly because you would have to take money from the fund to pay that third person. So we don’t want to do that.”

The big question is what if some money is missing from the fund? In this case, Hue said the likely tactic would be to secure what is left, and then pursue the other portion.

“I think at that point, if we found that out, we would probably ask the judge to order him to give us what he has,” he said. “We would then proceed in court to try to get that money back into the account some way. I think the court would be very upset if it found out that all that money was not there, particularly as Brown has already said that it is.”

Kimmage speaks of disappointment:

Paul KimmageLike Hue, many of those who donated had strong feelings when they found out that the fund had been moved out of the original account and, for all intents and purposes, was no longer readily available to Kimmage. As reported early on Saturday by VeloNation, the reactivation of Verbruggen and McQuaid’s case means that the journalist needs to know he has access to the money.

Instead, due to the way Brown acted, he states that he has no such guarantees.

“From day one, he needed to do a very simple thing,” Kimmage told VeloNation. “To hand over the funds and let people use it. He was in no place to decide when it was settled, what was settled, who would get it. He needed to say ‘I made a mistake, here are the funds, I will settle things separately with Lesli [about their former business partnership with Cyclismas].’

“How he thinks he is still a player is beyond me.”

Hue said that he donated $50 dollars to the fund. While he said that the amount was not particularly large when compared to some others, he said that his disappointment at hearing what had happened convinced him to take action.

“I was very disappointed. I think that was probably what set me on this journey that I have been on. I think the average donor was thirty dollars. That is so little money for people to try to get into the legal system to get things corrected. The class action was the best way to do it,” he said.

He added that if control is ultimately regained of the money, that he will waive his own refund.

While he and Cohen are waiting for Brown to supply the required details, Hue said that the two of them will compile their own list of people to whom refunds are due. This list will be cross-referenced with Brown’s own list, providing he complies, and then the court will be able to move forward.

“If we were to control the fund through the court, we would make efforts to contact everyone using a variety of ways – email, direct contact, notices by way of websites, asking journalists to help us by telling people what to do,” said Hue, looking a little further down the line. “At this point, though, we are not allowed to do anything yet as we don’t have a court order.”

Aside from her work in originally setting up the fund, Cohen said that she also gave money. “As a donor, I'm personally grateful for Bill's efforts on behalf of all of us,” she told VeloNation. “I am eager for the court to compel Aaron to provide details as to the current status and whereabouts of the missing money.

“We all deserve the answers we've been seeking from him for the better part of 2013.”

Kimmage agrees with the sentiment. “I am totally behind every attempt to get the money back from Brown and to resolve the issue fairly for everyone involved, most particularly the donors,” he said.

“I wish I could state this is all over, but it is uncertain what will happen next,” he added, referring to the Verbruggen/McQuaid suit.

Even if that matter is a little up in the air at this point, one thing is clear: Hue’s class action is forcing Brown to finally provide proof of his assertions that the fund is fully intact.

If it is, he will regain a little of the credibility that he has lost in the past nine months. If it is not, though, the flak he has received from fund donors will be fully warranted. The moment of truth is now.


Also see:

Feature: The many questions about the Kimmage defence fund 

Verbruggen and McQuaid reactivate legal case against Kimmage


 

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