2023 Southern California Public Radio - All Rights Reserved, As Fentanyl Deaths Climb, Bill Would Require Drug Education In Schools, Lawmakers Want More Social Media Regulation. The listing is available here: https://www.loopnet.com/Listing/Rutgers-Rd-Kennedy-Blvd-California-City-CA/20743529/. Windy with sunshine. In the mid-1950s, real estate developer Nat Mendelsohn began to buy a ton of land in the Mojave Desert, 100 miles north of Los Angeles. But by the late 1960s, people who had bought land in California City were starting to realize that the growth they'd been promised wasn't happening. In other words, Investor A provided 20%, Investor B provided 50%, and Investor C provided 30% of the total investment. Consumers had filed almost three dozen complaints with various agencies: the Kern County District Attorney, the California Department of Real Estate, even the Federal Trade Commission, but the company continued to operate until 2019. Many of those consumers ended up spending tens of thousands of dollars on land they were made to believe would be worth much more in the near future. Case Details Parties Documents Dockets. July 10, 2020 Offer to Purchase Silver Saddle Ranch and Club. On 04/16/2019 JOSE CARRILLO filed a Labor - Wrongful Termination lawsuit against SILVER SADDLE RANCH CLUB, INC. Prior to the hearing, the Court issued a tentative ruling approving the sale. January 17, 2020 W-2s for Former Employees. The Defendants named in the Complaint are: Silver Saddle Commercial Development, LP; Silver Saddle Ranch & Club, Inc.; The Galileo Commercial Property Owners Association, Inc.; Thomas M. Maney; and. Our complaint services are free and our team of expert mediators will assist in resolving complaints with businesses. SACRAMENTO - The Department of Business Oversight announced Oct. 1 that a state judge has granted its request to shut down an alleged investment fraud that collected more than $30 million from illegal land sales and other charges associated with the Silver Saddle Ranch & Club in California City. According to the motion, more than 33,000 emails were sent to Kidder Matthews west coast offices regarding the property, who communicated with 48 individuals interested in the property and provided tours for 12 groups. Higher wind gusts possible. The Galileo Project land is presently encumbered by roughly 1,700 fractional interests provided to the Galileo Project investors. 12. They watched a presentation about the area's potential. However, because the Silver Saddle Ranch & Club and the Galileo Project land are worth far less than the investors paid into the Galileo Project, no investor will be returned all of the money he or she invested. As such, while we have carefully considered the concerns raised by these investors, they do not have legal standing to object to the sale. A copy is available the documents section of this webpage. The lowest water bill was $4,339 for mid-March 2020 to mid-April 2020. In the 1970s, a man named Tom Maney began working for Great Western Cities. The case is still on-going. We can only do this important work with your help. 9, 2021), Receiver's Motion for Proposed Distribution to Investors (Feb. 8, 2021), Receiver's 3rd Interim Status Report (Jan. 14, 2021), Minute Order Granting Receivers Motion to Approve Sale of Ranch (Nov. 6, 2020), Receiver's 2nd Motion to Approve Sale of Ranch (Oct. 13, 2020), Receiver's 2nd Interim Status Report (Sept. 15, 2020), Silver Saddle Resort Sales Brochure (August 24, 2020), Galileo Parcels Sales Brochure (August 24, 2020), Receiver's Ex Parte Appl'n for Order Cancelling Escrows (Aug. 5, 2020), Preliminary Injunction re Accelerated Assets; SS Purchco; and Pahrump Valley Real Estate Co. (July 24, 2020), Minute Order re Motion to Intervene and for Preliminary Injunction (July 24, 2020), Moody Decl. The listing is available here: https://www.loopnet.com/Listing/20751-Aristotle-Dr-California-City-CA/19775266/. In addition to these structures, the ranch includes a stable and adjacent corral for animals, as well as a variety of amenities which were offered to guests: two swimming pools, a hot tub, man-made lakes, an RV park, and space for various sporting activities (miniature golf, basketball, tennis, volleyball, and badminton courts, etc.). After 14 days, the Receiver will respond to any investor objections filed with the Court, so that the Court can evaluate the Receivers calculations. Defendants specifically targeted investors from several ethnic communities, many of whom spoke little to no English. This class action lawsuit was filed on 01/25/2022 in Orange County Superior Court. On March 13, 2020, the Receiver filed the first status report. As we previously reported, even though operating expenses have been reduced, maintaining the Silver Saddle Ranch and Club (Ranch) continues to drain the limited resources of the Receivership Estate. For example, assume that Investor As claim is $30,000, Investor Bs claim is $50,000, and aggregate investor claims of $1,000,000. Hi last week march 20 we signed a contract from silver saddle ranch club for half a unit of their galileo project and deposited $3298 and has monthly payment of $273.66 for 10 years term. Investors will have 90 days to cash the checks. Regulatory Resolutions, operated by Thomas McNamara, agreed to the sale of the 130-acre property for $2.1 million to the proposed buyer Aaron Mamann after a previous arrangement was canceled. For the five-month period of September 2019 to March 2020, water, electricity, labor, and insurance costs for the Ranch was approximately $230,000. At a hearing on October 16, 2019, the San Diego Superior Court issued a Preliminary Injunction with asset freeze and confirmed the appointment of the Receiver over the Receivership Defendants (Silver Saddle Commercial Development, LP; Silver Saddle Ranch & Club, Inc.; The Galileo Commercial Property Owners Association, Inc., as well as any other entity that has conducted any business related to Defendants offering and selling of the Galileo Project investment contracts). The sale has been structured to allow the buyer 30 days to clear contingencies for the Ranch property and closing will be 60 days after the Court approves the sale. Escrow was opened on September 29, and the proposed buyer has 21 days to clear contingencies. Silver Saddle Resort was the mechanism by which the sales were made, facilitating sales events and provided investors with a free nights stay and tours of the ranch.. As you may be aware, the Court approved the sale of the Silver Saddle Ranch and Club ("Ranch") for $2,100,000. Should the Court order the sale to go forward, the Receiver intends to recommend to the Court that the sale proceeds be used to fund an investor distribution. If no objections are filed with the Court, the Receiver will promptly file a proposed Order approving the Receivers claim determinations. After obtaining an extensive appraisal, the Receivers team interviewed and selected a broker, Kidder Mathews, to sell the Ranch. New potential buyer found for Silver Saddle Ranch, BY JACK BARNWELL Please continue to check the Receivers website for periodic updates. Please notify us immediately if your mailing address has changed. re Accelerated's Opposition Preliminary Injunction (July 16, 2020), Receiver's Motion to Approve Sale (July 10, 2020), Receiver's Ex Parte Appl'n to Shorten Time (July 10, 2020), Receiver's Response to Motion to Intervene (July 9, 2020), Receiver's 1st Interim Status Report (Mar. While we have carefully considered the concerns raised by these investors, they do not have legal standing to object to the sale of the Ranch. A copy of the listing brochure is posted in the documents section. The Courts decision means that when the sale closes, the Silver Saddle investors will no longer have an interest in the Galileo Project Land. The trial date in this case remains the same, September 16, 2022. Even though operating expenses have been reduced, maintaining the Ranch continues to drain the limited resources of the Receivership Estate. The Silver Saddle Ranch was acquired for its combination of recreation potential, unique natural resources and its strategic location as a natural bridge connecting the Pine Nut Mountains and the Prison Hill Recreation Area. Instead, each investor will receive a share of the proceeds proportionate to his or her investment in the Galileo Project (a pro rata share). Landbanking is where a group of people jointly own a huge chunk of land. Investors Reviews of Claim Determinations. My 8-episode investigative podcast, California City, seeks to answer that question, as well as a bunch of others that came up over the course of my reporting. Now, survivors and their descendants seek reparations. Notice to Investors re Claim Determinations (Mar. However, the receiver soon received complaints from Maney and from local businessman Rick Jones. Silver Saddle Ranch is delivering the very best 2-acre homesites in the market. If you're enjoying this article, you'll love my daily morning newsletter, How To LA. DBO also filed a motion for preliminary injunction to stop these additional corporate defendants from collecting money related to the Galileo Project. We will provide an update after the August 27 hearing. In July, Mr. Maney asked the Court to stay this case, which would put the case on hold, until the criminal case is finished. 4, 2022), Gordon Decl. If $100,000 is distributed, then Investor A would get $3,000 and Investor B would get $5,000. DBO contends that businessman Thomas Maney and other associates conned people into purchasing land shares on theGalileo Project with the promise of earning a significant return on investment down the road. Many were young couples and hard-working immigrants looking to build a better future. The DBO alleged that Defendants committed securities fraud in connection with the sale of undivided interests in 1,020 acres of vacant desert property near California City, California in Kern County. This case was filed in Los Angeles County Superior Courts, Stanley Mosk Courthouse located in Los Angeles, California. Community funding keeps us independent and accountable. The receiver noted in the motion that many of these amenities were modestly constructed, outdated, and poorly maintained.. California City is filled with signs advertising vacant land for sale. Family Says Mental Health System Failed Their Son, A Los Angeles Family Seeks Answers And Accountability After Black Mom Dies In Childbirth. On July 16, 2020, the Court held a hearing on the Receivers Ex Parte Application to Shorten Time for a Hearing on the Receivers Motion to Approve the Sale of Silver Saddle Ranch and Club. Winds SW at 20 to 30 mph. re Receiver's Motion to Approve Sale of Galileo Project Land (Mar. In my reporting, I learned that Silver Saddles land sale scheme was essentially an open secret in Kern County. We will update again after September 15, 2023 status hearing or before if events merit. It had been going on for years. To be clear, the Galileo Project investors do NOT hold an interest in the Ranch property; the Ranch is owned by Receivership Defendant Silver Saddle Ranch & Club, Inc. Two Los Angeles artists have new work on display. In a response filed with the court, calling it an eleventh-hour plea to unwind a valid contract and that it wreaks of impropriety and sour grapes based on obtuse contentions that do not withstand the requisite scrutiny required under the law.. While the Ranch may be the Receivership Estate's most valuable asset, its costly upkeep, utilities, and insurance will soon deplete the limited funds of the Receivership Estate if it is not sold, the motion states. Heres How To Start Your Search, Emmery Muoz, 14, Was Killed In LA 17 Years Ago. At that time, the Receiver will also file a Notice of Final Determination of Claims with the Court. But in an interview, Maney told me he and Silver Saddle have nothing in common with Nat Mendelsohn or Great Western Cities. inter alia, defendants Silver Saddle Ranch & Club, Inc. (SSRC), Silver Saddle Commercial Development, LP (SSCD), Galileo Commercial Property Owners Association, Inc. (GCPOA), and Thomas M. Maney (Maney), alleging that said defendants offered and sold to the public an But much of the land they bought is nearly worthless. Mismanagement, Sloppy Hiring Practices, Lack Of Transparency. Deep in the Mojave Desert, there is a little town with a big name and a bizarre history: California City. Separately, the Receiver sought the Courts permission to list for sale two other, smaller properties owned by Receivership Defendant High Plains Mesa Holdings. Like many urban planners at the time, Mendelsohn thought major cities like Los Angeles were overcrowded, polluted and dangerous. Leads Ali Wong and Steven Yeun issue a joint statement along with show creator Lee Sung Jin. The current sales brochure for the Ranch and the Galileo Project can be found in the Documents section of this webpage. What You Should Know About This Year's 'Constant Bloom', You Need Child Care For Your Baby. The Receiver selected Kidder Mathews as the real estate brokers to market the Ranch property, and the listing went active on May 8, 2020. The Final Determination of Investor Claims will be used to calculate the pro rata share of any distribution ordered by the Court. MENDELSOHN'S SALES TACTICS DREW THE ATTENTION OF RALPH NADER, AND GOT THE COMPANY IN SERIOUS TROUBLE WITH THE FEDERAL TRADE COMMISSION. Silver Saddle Ranch & Clubruns and operates a resort facility in California City called the Silver Saddle Ranch and Club (Ranch), located at 20751 Aristotle Drive, California City, California 93505. Since 2011, Silver Saddle's sales agents sold "shares" of the landbanking project to more than 2,000 people, for up to $30,000 each. Two Los Angeles artists have new work on display. The Motion to Approve the Sale of the Ranch and related documents are in the Documents section of this webpage. The Galileo Project land is presently encumbered by roughly 1,700 fractional interests provided to the Galileo Project investors. In that scenario, Investor As pro rata share is 3% and Investor Bs pro rata share is 5%. This case was filed in San Diego County Superior Courts, San Diego Central Courthouse located in San Diego, California. Timeline for Court Challenge to Receivers Confirmation of Claim Determination. As we have noted repeatedly, calculating the Final Claim Determination amounts does NOT mean investors will receive those amounts. The Receiver has suspended all business operations, including the Silver Saddle Ranch & Club. If you opted out of electronic delivery, Insperity will mail the W-2 to your home address that was on file as of December 31, 2019. The Galileo Project land is presently encumbered by roughly 1,700 fractional interests provided to the Galileo investors. All of the defendants are affiliated with Silver Saddle Ranch & Club, a remote desert resort in California City about an hour and a half north of L.A., where salespeople offered free weekend vacations to Latino, Filipino and Chinese consumers in exchange for sitting through a high-pressure sales pitch. If and when the Court enters an Order allowing a distribution to investors, the Receiver will issue investor checks promptly and consistent with the claims determinations. The proposed call to approve the land sale isnt the first time the receiver has anticipated selling the resort and the project land. Copies of the Complaint and the TRO are available in the documents section of this webpage. Last year, the Receiver sought the Courts permission to approve the sale of land owned by Receivership Defendant High Plains Mesa Holdings, LP, for $4,100,000. Thomas Maney and the companies running these investments (the Defendants) were sued by the California Department of Financial Protection and Innovation (DFPI) in 2019. The price was adjusted a few times before stabilizing at $1.87 million. Will Orange County's Fledgling Clean Power Agency Survive. The agency accused Silver Saddle, Maney, Ducreux and other defendants of securities fraud and selling unqualified securities. As the Receiver mentioned in his last update, the same proposed buyer who offered $2,100,000 for the Ranch also offered $900,000 for the Galileo Project vacant land. In other words, no investor will receive the full amount of his or her claim. Winds SW at 15 to 25 mph. Because the Silver Saddle Ranch & Club and the Galileo Project land are worth far less than the investors paid into the Galileo Project, no investor will be returned all of the money he or she invested. But even if the sale goes through, it won't generate nearly enough money to make all the investors whole. No, the Ranch was permanently closed and recently sold to a third party pursuant to a This means that the Receiver can start calculating investors losses so that, if and when a distribution is ordered, the Receiver can begin sending money to investors right away. If you think the Receivers claim determination is wrong, you have until April 8, 2022 to send the Receivers office a letter or email challenging the calculations. A copy of the Receivers First Interim Status Report is posted in the Documents section of this webpage. Most of the land Mendelsohn sold was bought by participants of a program he created that taught people how to be a real estate agent-- by selling land in California City. March 9, 2022 Motion to Approve Sale of Galileo Project Land Filed. The Receiver has been marketing the Ranch through a real estate broker for sale since May. The Case Remains Cold, Even 'Affordable Housing' In LA Isn't Affordable. Instead, each investor will receive a share of the proceeds proportionate to his or her investment in the Galileo Project (a pro rata share). In the 1950s and 60s, the city evicted the mostly Black and Latino working-class residents of Section 14 and destroyed their homes. Also, inclusion of the prospective intervenors as parties would enlarge the issues in the case because many of the approximately 3,000 investors have disparate opinions regarding disposition of the receivership estate. A full copy of the Courts Minute Order is available in the Documents section of this webpage. Based upon an independent appraisal prepared for the Galileo Project land, the Receiver believes this offer is fair, reasonable, and at or above market value for the property. The owners of the 30,000-acre Silver Saddle Ranch & Club, about a dozen miles north of the downtown here in a remote corner of this remote city, are touting the open spaces of the high desert as a . The list is sorted by investor account number, which number was included in the Preliminary Claim Determination letters that were mailed to each investor. The contract had no cancellation period, and buyers were required to pay $41 a month in membership fees to Silver Saddle -- indefinitely. There would be half a million residents living along winding city streets that were curved to slow down traffic. 4. Thomas W. McNamara was appointed as the Receiver in this case. Maney helped negotiate the settlement with the FTC, and after Great Western Cities declared bankruptcy in 1984, he acquired some of the assets, including a lot of vacant California City land and a small resort called Silver Saddle Ranch. July 17, 2020 Results of Hearing on Receivers Ex Parte Application. This will ensure the sales process is healthy and will maximize the sales price, which is in the best interest of the Receivership Estate. Insperity, the payroll provider, will issue W-2s to former employees by January 31, 2020 via either U.S. mail or electronic delivery. One offer fell too low beneath the listing price. Who knows when we'll see such vibrance again in this recently drought-choked land? Even with the reduced water rates, we expect water will continue to be a substantial expense and all other expenses will continue e.g., electricity, labor, and insurance. Graduates of the program were expected to buy a piece of land themselves, and refer their friends and family. According to the receiver, the resort operated at a loss that eventually hit $1.5 million a year but continued to operate on subsidies from other related business the defendants operated. That same year, Nat Mendelsohn died. The Court denied the Receivers ex parte application for an order cancelling escrows for the Ranch and Galileo parcels, and stated that it was not inclined to rule on the request via ex parte application. 7, 2022), Receiver's Motion to Approve Sale of Galileo Project Land (Mar. The developer of California City, Nat Mendelsohn, built hundreds of miles of roads through the empty desert. It wasnt. That case, which is a separate civil lawsuit unrelated to the new . You have permission to edit this article. Help us provide credible local journalism and timely NPR reporting to our entire community. Should the Court order the sale to go forward, the Receiver intends to recommend to the Court that the sale proceeds be used to fund an additional investor distribution. For example, to date the Receiver has paid $285,580 for water alone. The DBO alleged that Defendants committed . As you may be aware, the Court approved the sale of the Silver Saddle Ranch and Club (Ranch) for $2,100,000. The DFPI alleged that Defendants . We have received emails and letters from a small number of investors (who appear to be coordinating with Antonio Garcia and Carlos Novelo, and their United Owner Investors, Inc.) objecting to the sale of the Ranch. For the latest national news from NPR and our live radio broadcast, visit LAist.com/radio. The new trial date is May 6, 2022. If the motion is granted, the closing should occur 60 days thereafter. August 17, 2020 Postponement of Receivers Motion to Cancel Escrows. the assets of the Receivership Estate while the lawsuit proceeds. The highest water bill was $46,864 for mid-October 2019 to mid-November 2019. Most of the money, the DBO learned, was gone. Notice of this filing will be provided to investors by email and via posting on the receivership website. Silver Saddle Ranch & Stables is a horse boarding facility. The Receiver has retained counsel to address both the appeal and the bankruptcies. (Chava Sanchez/KPCC). In this new podcast from LAist Studios, host Emily Guerin tells a story of money, power and deception. The Galileo Project land is presently encumbered by roughly 1,700 fractional interests provided to the Galileo Project investors. 3. The Receiver will use proceeds from the sale to pay expenses of the Receivership Estate and provide a first distribution to Silver Saddle investors. The Receiver hired counsel for both matters. We will seek the Courts approval of the sale at a hearing on April 15, 2022, at 9:00 a.m., at the San Diego Superior Court, Hall of Justice, Department C-73. If the Motion is granted, the Receiver will be able to start the distribution process. On 06/06/2019 MICHAEL BALAGTAS, filed a Contract - Other Contract lawsuit against SILVER SADDLE COMMERCIAL DEVELOPMENT, LP ,. We will provide an update if the trial date changes. Should the Court order the sale to go forward, the Receiver intends to recommend to the Court that the sale proceeds be used to fund an investor distribution. You can either mail the information to: Silver Saddle Receiver c/o Regulatory Resolutions 655 W. Broadway, Suite 900 San Diego, CA 92101. 13, 2020), Amendment to Complaint Adding SS Purchco, Kvassay, Huebner (Feb. 5, 2020), Amendment to Complaint Adding Kelly Maney (Dec. 5, 2019), Amendment to Complaint Adding Maria Rosales (Dec. 5, 2019), Temporary Restraining Order (Sept. 24, 2019), Motion to Approve the Sale of the Galileo Project Land, Declaration of Cornelia J. April 18, 2022 Court Grants Motion to Approve Sale of Galileo Project Land. To support our non-profit public service journalism: Donate Now. Silver Saddle lured prospective buyers from around California with the promise of a free weekend at the ranch. The agency accused Silver Saddle, Maney, Ducreux and other defendants of securities fraud and selling unqualified securities. However, the sales pavilion, parking, and other related improvements are located on a 24-acre parcel is owned by the City of California City and leased to Silver Saddle Resort and Club which expires April 17, 2027. Defendants comingled and diverted funds that had been promised to be set aside and preserved for the investors benefit, making it difficult to trace exactly how investor money was being spent. For the latest national news from NPR and our live radio broadcast, visit LAist.com/radio. What questions do you have about Southern California? The case status is Pending - Other Pending. 60 Years Of Deception And Land Sales In California City: 7 Takeaways From My Investigative Podcast, California City Podcast: State Adds Use Of Cell Phone Jammers to Complaint Against Silver Saddle, 'California City' Podcast Tells The Dark Side Of The American Dream. If you are an investor and do not receive a letter by March 15, 2022, please contact the Receivers office at info@regulatoryresolutions.com. Now, survivors and their descendants seek reparations. On March 19, the Court heard oral argument on the Receivers Motion and denied the Receivers request to proceed with an interim distribution to investors. A lot of it was used to pay sales agents. If you are an investor and you agree that the claim determination prepared by the Receiver is correct, you do not need to do anything. On September 28, the Receiver agreed to a sales price of $2,100,000 for the Ranch. The Case Remains Cold, Even 'Affordable Housing' In LA Isn't Affordable. Importantly, the Receiver intends to request the Court authorize that the Galileo Project vacant land be conveyed with a clear title and free of the Galileo Project investors fractional interests. In that same brief, the receivers attorney, Edward Chang, noted that the real estate company handling the transaction and Jones have sharply contrasting descriptions of the sales process. THE CALIFORNIA DEPARTMENT OF BUSINESS OVERSIGHT CHARGED SILVER SADDLE WITH FRAUD AND SHUT THE COMPANY DOWN IN 2019.

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