Jeremy Johnson seeks monetary damages St. George businessman Jeremy Johnson loses appeal to stop auction and files lawsuit

Kevin Jenkins The Spectrum

Rick Egan ST. GEORGE - St. George businessman Jeremy Johnson filed a lawsuit in St. George's 5th District Court on Friday seeking monetary damages stemming from the auction of his assets. The lawsuit was filed hours before a Las Vegas federal judge denied Johnson's requests to stop the further sale of his company's property and to return items already sold at auction. The assets have been held by a receiver appointed as part of a federal lawsuit filed by the FTC against Johnson's companies. The lawsuit accuses Johnson's company I-Works and related corporate entities of luring customers into "bogus government-grant and money-making schemes" and then charging fees to their credit cards without permission. Johnson was arrested in June at a Phoenix airport on a similar criminal complaint filed in Utah's federal court, and while he was held in jail, the Las Vegas court approved the receiver's request to auction some of Johnson's assets to create liquidity in the civil case and put a stop to mounting debts associated with warehousing the property. The September auction of more than 200 lots of office items and vehicles in Hurricane provided the receiver with hundreds of thousands of dollars. Johnson's St. George lawsuit acknowledges the sale and specifically complains that the receiver allowed a 1957 Chevy Bel-Air worth about $100,000 to be sold for less than half its value, allowed the registration to lapse on the Internet domain name Badcustomer.com, valued at about $25,000, and allowed an airplane worth about $1.8 million to experience weather-related damage, affecting its value. Johnson, acting as his own attorney, is asking the court to award an amount of monetary damages as a result, following a trial on the matter. Deputy managers at California-based receiver Robb Evans & Associates were not available Friday for comment, but Tom Erkelens, an auctioneer with Statewide Auction Company who presided over the Hurricane sales, said he disagreed about the value of the Bel-Air, which was the top-selling item at the auction. "That car needed work. It was not in mint condition," Erkelens said, adding he had not seen the court filing. "We got every nickel that thing was worth, and then some. ... We got more than it was worth." Johnson also appeared before U.S. District Court Judge Roger Hunt in Las Vegas on Friday to appeal the sale of I-Works property and ask for its return. Johnson stated he is not employed and does not have a source of income, and told the court the receiver's control over his assets prevents him from paying for an attorney, according to court documents. In court documents, Johnson argued the court deprived him of due process regarding his property because it has not made a final judgment in the lawsuit. Johnson also stated the court did not hold a hearing before ordering the asset liquidation as required by legal statute, did not notify him of the decision, did not obtain independent appraisal of the property's value and did not work in the best interest of his estate. Hunt denied the motion to stop further auction of the business's assets after hearing five-minute arguments from Johnson, other defendants named in the case and the receiver's attorney, according to court documents. Hunt also denied motions to return the auctioned property and a motion that would have allowed Johnson's wife and business partner, Sharla Johnson, to appeal court decisions as an outside party.

TheSpectrum.com Originally published October 15, 2011

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