Date: 11-08-2012

Case Style: B.E.L.T., Inc. v. A.C.G., Inc. d/b/a Tan & Tone America

Case Number: CJ-2012-4992

Judge: Roger H. Stuart

Court: District Court, Oklahoma County, Oklahoma

Plaintiff's Attorney: Ken Felker and Lori A. Sanders

Defendant's Attorney:

Description: COMES NOW the Plaintiff and for its causes of action against the Defendants, alleges and states: 1. Plaintiff (hereinafter ‘Belt) is a Kansas corporation in good standing with its principal place of business in Wichita, Kansas.

2. Defendant A.C.G. Inc. (hereinafter ACG) is an Oklahoma corporation with its principal place of business in Oklahoma County, Oklahoma. Defendants Edward Shelby and Becky Shelby (hereinafter ‘Shelbys”) are residents of Oklahoma County, State of Oklahoma.

3. The events which gave rise to this litigation occurred in Oklahoma County, Oklahoma and venue is proper herein.

FIRST CAUSE OF ACTION-BREACH OF CONTRACT COUNT I

4. Defendant ACG rented fitness equipment from Plaintiff on account pursuant to an equipment lease agreement dated January 28, 2008. A true and correct copy of this lease is attached hereto as Exhibit “I”. This lease was renegotiated several times, the final document being signed by the Defendants on July 28, 2010. A true and correct copy of this lease is attached hereto as Exhibit “IA”. The Shelbys signed an unconditional guaranty wherein they personally guaranteed the lease indebtedness to Belt.

5. Belt properly perfected its security interest in the equipment by filing a UCC-l with the County Clerk of Oklahoma County on May 12, 2009.

6. Default has been made on the payments due on this lease and there remains due and unpaid the sum of $74,743.50 which Belt is entitled to recover from ACG and the Shelbys

WHEREFORE, Plaintiff prays for judgment against the Defendants for the sum of $74,743.50, interest at the statutory rate, the costs of this action, a reasonable attorneys fee, and such other relief as the Court may deem just and proper.

COUNT II

The Plaintiff re-pleads and adopts all the allegations set forth in its prior counts and in addition thereto alleges as follows:

7. Defendant ACO rented fitness equipment from Plaintiff on account pursuant to an equipment lease agreement dated April 27, 2011. A true and correct copy of this lease is att ached hereto as Exhibit “2”. The Shelbys signed an unconditional guaranty wherein they personally guaranteed the lease indebtedness to Belt.

8. Belt properly perfected its security interest in the equipment by filing a UCC-l with the County Clerk of Oklahoma County on May 3,2011.

9. Default has been made on the payments due on this lease and there remains due and unpaid the sum of $38,696.00 which Belt is entitled to recover from ACO and the Shelbys

WHEREFORE, Plaintiff prays for judgment against the Defendants for the sum of $38,696.00, interest at the statutory rate, the costs of this action, a reasonable attorney’s fee, and such other relief as the Court may deem just and proper.

COUNT Ill

The Plaintiff re-pleads and adopts all the allegations set forth in its prior counts and in addition thereto alleges as follows:

10. Defendant ACO rented fitness equipment from Plaintiff on account pursuant to an equipment lease agreement dated May 9, 2012. A true and correct copy of this lease is attached hereto as Exhibit “3”. The Shelbys signed an unconditional guaranty wherein they personally guaranteed the lease to Belt.

11. Belt properly perfected its security interest in the equipment by filing a UCC-1 with the County Clerk of Oklahoma County on May 29, 2012.

12. Default has been made on the payments due on this lease and there remains due and unpaid the sum of $67,650.00 which Belt is entitled to recover from ACG and the Shelbys

WHEREFORE, Plaintiff prays for judgment against the Defendants for the sum of $67,650.00, interest at the statutory rate, the costs of this action, a reasonable attorney’s fee, and such other relief as the Court may deem just and proper.

SECOND CAUSE OF ACTION-REPLEVIN

The Plaintiff re-pleads and adopts all the allegations set forth in its first cause of action and in addition thereto alleges as follows:

13. The Defendant is in possession of the said property and refuses to pay rent thereon or to return the equipment to the Plaintiff. The property is lawfully owned by the Plaintiff.

14. The actual value of the property is unknown but on information and belief, it is estimated to be in excess of$100,000.00.

15. That the Plaintiff fears that the Defendants may, unless restrained by the Court, attempt to secret, conceal, damage, destroy, transfer, assign, sell or dispose of the property which is the subject of this action and requests the Court to enter its order, ex pane, restraining and enjoining the Defendants or agents of the Defendants from the acts alleged in this paragraph.

16. That the property was not taken in execution on any order of judgmeni. against said Plaintiff, or for the payment of any tax, fine or amercement assessed against the Plaintiff, or by virtue of an order of delivery issued, or any other mesne or final process issued against said Plaintiff,

WHEREFORE, Plaintiff prays that the Court issue an Order for the immediate delivery of the property to Plaintiff and that upon delivery of the property to the Plaintiff, the court enter an order foreclosing Plaintiffs security interest in and to the property; that the property be sold in a commercially reasonable maimer and the proceeds applied to the indebtedness owea to Plaintiff; for a reasonable attorney fee and costs incurred; and for such other relief to which Plaintiff is entitled and which may be deemed just and proper by the Court.

THIRD CAUSE OF ACTION-FRAUD

The Plaintiff re-pleads and adopts all the allegations set forth in its prior causes of action and in addition thereto alleges as follows on information and belief:

17. The Defendants entered into the contract more fully described in Count III of Plaintiff’s First Cause of Action knowing that their business was insolvent at the time of contracting. Furthermore, said Defendants knew that they would not pay the obligation to Plaintiff.

18. In spite of these facts, the Defendants represented to Plaintiff that they would make timely payments on the lease indebtedness, knowing that the Plaintiff would rely on those representations in extending additional credit to said Defendants.

19. The Plaintiff did in fact rely on the false representations of the Defendants and extended additional credit to them.

20. The Plaintiff has suffered detriment due to its reliance on the Defendants’ misrepresentations because the payments have not been made, the equipment cannol be leased to other customers, and Plaintiff has incurred and will continue to incur attorneys fees to enforce its rights and to secure possession of its property.

WHEREFORE, the Plaintiff B.E.L.T., Inc. prays for judgment against the Defendants A.C.G., Inc., Edward Shelby and Becky Shelby for fraud in excess of $10,000.00, for its costs, including its attorneys fees, and for exemplary damages for the Defendants’ intentional tortious conduct, and to deter others from like conduct.

Outcome: Receiver appointed.

Plaintiff's Experts:

Defendant's Experts:

Comments: