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Update: April Petty awaits Judge’s decision on motion to dismiss EDA civil case seeking return of $125,000 received from Jennifer McDonald during 2016 home sale process

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(Author’s note: As of Saturday morning, May 28, at 11:15 a.m. this story has been updated with additional detail on the $125,000 check transferred from an EDA account by Jennifer McDonald to Ocwen Loan Servicing LLC during April Petty’s 2016 home sale process.)

Judge Bruce D. Albertson took dueling arguments on a defense motion to issue a summary judgment dismissing all civil claims regarding the FR-WC EDA’s action against defendant April Petty under advisement Tuesday afternoon, May 24. Cullen Seltzer represented the plaintiff EDA, now trading as the Warren County EDA in the wake of the Town of Front Royal pulling out of involvement as it litigates against the half-century-old joint Town-County EDA over disputed losses tied to the FR-WC EDA financial scandal. Petty was represented by defense counsel William Shmidheiser III.

Petty’s case, among a number of others alleged as beneficiaries and co-conspirators of former EDA Executive Director Jennifer McDonald are scheduled for civil court trials beginning in early July. Following taking the Petty motion under advisement the court dealt with jury selection issues with attorneys for a number of civil case defendants patched in by phone. Those included counsel for Truc “Curt” Tran and ITFederal, Donnie Poe and Earthlink Energy, Ms. Hassenplug, and Samuel North. With input from Circuit Court Clerk Angie Moore, it was decided a rather complex process involving a fairly large jury pool with begin Wednesday and Thursday June 29th and 30th.

The Petty dismissal motion filing dated April 21 targets all five aspects of the EDA’s civil case against Petty, scheduled for jury trial on July 5 and 6. All the civil liability aspects of the plaintiff EDA’s case against Petty revolve around receipt of a $125,000 EDA check from Jennifer McDonald that was applied to payment on a mortgage loan at Ocwen Loan Servicing on Petty’s home, during Petty’s 2016 effort to sell that home. That money is cited as part of the estimated $21 million in EDA assets that McDonald is alleged to have misdirected to unauthorized personal use and benefit of herself and others.


The five aspects of the plaintiff’s case against Petty are “Unjust Enrichment”, the receipt of benefit by one party from another without a reciprocal benefit to the other party (in this case the EDA); “Conversion” (unauthorized possession); application of the “ultra vires” standard of acting beyond one’s legal authority; “Conspiracy” in knowingly acting in concert with Jennifer McDonald in the receipt of misdirected EDA assets; and “Fraud” related to the “Conspiracy” allegation that Petty knew that $125,000 McDonald applied to her mortgage loan was money the EDA asserts was stolen.

Plaintiff EDA and civil case defendant April Petty are awaiting the court’s ruling on her motion for dismissal of case against her. Royal Examiner File Photos by Roger Bianchini

Petty’s attorney pointed out that when an earlier grand jury was handing out blanket criminal indictments against alleged McDonald co-conspirators including two full EDA oversight boards, April Petty was not one of those indicted by the grand jury. Pointing to what he believes is a lack of evidence against his client having any knowledge of the alleged embezzlement conspiracy, Shmidheiser asserted to the court that “all the charges” related to the plaintiff’s “conspiracy theory” involving her should be dismissed. Essentially that is the final four of the five above EDA claims against Petty.

“All they had, have today is the check,” Shmidheiser told the court of the $125,000 check drawn on an EDA account appearing to be co-signed by McDonald and then EDA Board of Directors Chair Patricia Wines made to Ocwen (misspelled as Owen) Loan Servicing LLC that was applied to Petty’s home sale price.

At this point Judge Albertson asked defense counsel if McDonald had, in fact, transferred that money to April Petty. “Yes, but April Petty did not know that it was embezzled money,” her attorney said walking a legal tight rope between knowledge and consequence.

“You’re asking me to skip over the trial part of this case,” Judge Albertson told Shmidheiser. “Yes, I am,” defense counsel replied moving toward his argument against the “Unjust Enrichment” aspect of the case against Petty.

Noting his client’s belief McDonald was acting in her role as a real estate agent with Century 21 Real Estate in helping Petty accomplish the sale of her home, Shmidheiser asserted that his client was not by legal definition “unjustly enriched”. He elaborated that in exchange for the $125,000 check Petty believed was fronted to her mortgage loan to help facilitate her home sale, “plus another $210,000 Petty received at Closing on her home, she Deeded her house, which was listed for $330,000, to purchasers Mr. and Mrs. Leary,” Shmidheiser explained.

“She didn’t get money for nothing, she got money for her house,” the defense attorney later elaborated to this reporter on his courtroom arguments. During those arguments in support of his motion for a dismissal of the civil case against his client, Shmidheiser revealed how he prioritized his case for dismissal. And it appeared he felt the optimum legal path forward if a trial was required would be in dispelling the notion that April Petty was a conscious co-conspirator of Jennifer McDonald’s in her alleged embezzlement schemes.

“We’ll live with all but ‘Unjust Enrichment’,” Shmidheiser told the court of the prospect of a two-day trial in early July. “I’m confident we will win at trial,” Shmidheiser added of having to present the defense case to a jury on the conspiracy aspect of the EDA’s civil claims against his client.

Defense counsel also cited an established three-year statute of limitation standard he said the plaintiff had not met in charging his client for liability for funds she received in March 2016. The case of Belcher vs. Kirkwood was cited by Shmidheiser in support of the three-year statute of limitations having expired by the time his client was charged civilly. To not apply the three-year Statute of Limitations precedent would be tantamount to the court altering existing state legal precedent, which the defense attorney theorized would lead to a higher court reversal of denial of his motion for dismissal on the Unjust Enrichment aspect.

Counterpoint

In countering Shmidheiser’s arguments, EDA attorney Cullen Seltzer disputed defense assertions surrounding the applicability of the Belcher vs. Kirkwood case in an alleged financial fraud not discovered at the time it was occurring in 2016 when Ms. Petty is believed by the plaintiff to have been involved. He also argued that the defense points being made in support of a motion for dismissal were more appropriate for a jury to hear for a finding of guilt or innocence.

For dismissal to be granted the defense must show that “no facts are in dispute” Seltzer told the court. And from the plaintiff’s perspective that is not the case. Seltzer noted that Petty admits the $125,000 check went to pay on her mortgage loan during her sale process.

“She was very anxious to sell,” Seltzer told the court of Petty’s motivation to accept money he said she had expressed “suspicion” about when offered. Of his client’s initial “suspicions” about the money offered from an EDA account referenced by the EDA attorney during arguments, Shmidheiser noted that Petty had been assured by, not only McDonald, but others that it was “business as usual” on the economic development/real estate transaction front.

Of Petty’s close friend Robin Richardson, who was said to have brought McDonald to Petty during her attempt to sell her house, plaintiff counsel told the court of a second transfer of funds. Seltzer asserted that when Petty put “almost $42,000 in her pocket from her home sale, she had given Ms. Richardson $10,000. Is there evidence that was money previously owed by Petty to Richardson or was it comparable to a “finder’s fee” for bringing McDonald into the picture to help facilitate the home sale with the $125,000 loan payment on Petty’s behalf, Seltzer asked the court.

And now both plaintiff and defendant are awaiting the court’s ruling on all aspects of the defense motion for summary judgment on dismissal of the case against April Petty.

The EDA office on Kendrick Lane was ground zero as the alleged financial scandal unfolded between 2014 and 2018.

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Virginia’s annual crime analysis report now available on Virginia State Police website

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Virginia’s official and only comprehensive report on local and statewide crime figures for 2021, titled Crime in Virginia, is now available online at the Virginia State Police website on the VSP CJIS Data Analysis & Reporting Team page. Crime in Virginia continues to provide precise rates and occurrences of crimes committed in towns, cities and counties across the Commonwealth. The report breaks down criminal offenses and arrests by reporting agency.

Violent crime includes the offenses of murder, forcible sex offenses (rape, sodomy and sexual assault with an object per the FBI’s updated rape definition), robbery and aggravated assault. Overall, the violent crime rate increased in 2021 to 194.4 (per 100,000 population) from 183.0 in 2020.  There were 16,823 violent crime offenses reported in 2021 compared to 15,713 violent crime offenses reported in 2020, representing a 7.1% increase.

The following 2021 crime figures in Virginia are presented in the report:

  • The number of reported homicides increased from 528 to 562 (6.4%).  The murder/non-negligent manslaughter rate increased from 6.15 in 2020 to 6.49 in 2021 (per 100,000 population).  Victims and offenders tended to be younger males; 38.6% of homicide victims were men between 18 and 34 and 55.7% of known offenders were men between 18 and 34.  Nearly half (47.5%) of all homicides occurred at a residence/home.
  • Motor vehicle thefts and attempted thefts increased 3.8% compared to 2020. During 2021, there were 11,638 motor vehicles reported stolen in 11,249 offenses. In 2021, 7,589 motor vehicles were recovered (vehicles may have been stolen prior to 2021).  Of all motor vehicles stolen, 35.4% were taken from the residence/home.  The reported value of all motor vehicles stolen was $131,738,135.
  • Drug arrests decreased by nearly half (46.7%) with the largest percentage decrease in arrestees under age 25 (67.6%).  The number of reports of drugs seized decreased for nearly all drug types, especially marijuana (67%), due in part to decriminalization of possessing less than 1 ounce of the drug effective July 1, 2020 and Code of Virginia §18.2-250.1 being repealed July 1, 2021.
  • Burglary decreased by 8.3% between 2020 and 2021. In fact, burglaries and attempted burglaries have steadily declined over the past ten years. In 2021, there were 10,464 burglaries and attempted burglaries whereas in 2011 there were 27,872, representing a decreased burglary rate in the last decade from 344.24 to 120.89 per 100,000 population.
  • Fraud offenses increased 8.4% compared to 2020. Nearly 80% of victims (79.9%) were individuals while 11.3% were businesses. Nearly a quarter (23.2%) of fraud victims were over the age 65.
  • Of the known weapons reported for violent crimes, firearms were used in 82.1% of homicides and 48.6% of robberies. Firearms were used in more than one-third (38.7%) of aggravated assault cases.
  • There were 123 hate crime offenses, involving 106 victims, reported in 2021.  This represents a 35.3% decrease compared to 2020. Most hate crimes (69.8%) were racially or ethnically motivated. Bias toward sexual orientation and religion were next highest (19.0%, 8.7%, respectively). Of all reported bias motivated crimes, 75.6% were assault offenses (aggravated assault, simple assault) or destruction/damage/vandalism of property.

The report employs an Incident Based Reporting (IBR) method for calculating offenses, thus allowing for greater accuracy. IBR divides crimes into two categories: Group A for serious offenses including violent crimes (murder, forcible sex offenses, robbery and aggravated assault), property crimes and drug offenses, and Group B for what are considered less serious offenses such as trespassing, disorderly conduct, and liquor law violations where an arrest has occurred.


Per state mandate, the Department of Virginia State Police serves as the primary collector of crime data from participating Virginia state and local police departments and sheriff’s offices. The data are collected by the Virginia State Police Criminal Justice Information Services (CJIS) Division via a secured internet system. This information is then compiled into Crime in Virginia, an annual report for use by law enforcement, elected officials, media and the general public. These data become the official crime statistics for the Commonwealth and are sent to the FBI for incorporation into their annual report, Crime in the United States.

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Trio of Front Royal women plead guilty to oxycodone distribution ring

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A Front Royal woman pleaded guilty Monday to being the “ringleader” of a decade-long oxycodone distribution network, according to the U.S. Attorney’s Office for the Eastern District of Virginia.

Candie Marie Calix, 40, worked as an office manager for an unnamed Arlington, VA doctor, according to court records that identify the doctor as “Doctor-1.”

Kendall Sovereign, 56, and Jessica Talbott, 35, both of Front Royal, also pleaded guilty to being co-conspirators in the drug ring.

Between 2012 and 2022, court records state that the doctor prescribed Calix nearly 40,000 oxycodone 30-mg pills and over 9,000 oxycodone 15-mg pills. The doctor also prescribed similar quantities of oxycodone 30-mg and 15-mg pills to Calix’s relatives, including her mother, grandparents, great-grandmother, husband, and brother.


Court records indicate that Calix distributed or directed others to distribute most of the pills prescribed to Calix and her family members by “Doctor-1.”

The U.S. attorney’s office said that Calix “functioned as the gatekeeper” to the doctor and recruited people she knew from the Front Royal area to be “patients” of the doctor and obtain large quantities of oxycodone.

These “patients,” officials say, “typically kicked back the oxycodone 30-mg pills they were prescribed to Calix to redistribute and kept the oxycodone 15-mg pills for their own use.”

“Calix and her co-conspirators used coded language to refer to the pills they distributed, for example, referring to oxycodone 30-mg pills as ‘tickets,’ ‘blueberries,’ or ‘muffins,’” the U.S. attorney’s office said in a media release.

Court documents show that co-conspirators “typically sold oxycodone 30-mg pills at a cost of $25 per pill, and over the course of the conspiracy, generated at least $5,000 per month in profits.”

Calix is scheduled to be sentenced on Sept. 28 and faces a maximum penalty of 20 years in prison, though actual sentences for federal crimes are typically less than the maximum penalties, the release states. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Sovereign and Talbott are scheduled to be sentenced on Sept 21.

The case is being prosecuted by Assistant U.S. Attorney Katherine E. Rumbaugh.

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New information revealed during presentation of plea agreement in William Luckey sexual solicitation of a minor case

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Citing the agreement of the family of the minor victim, early Friday afternoon, June 24, in Warren County Circuit Court the prosecution and defense submitted a plea agreement with amended charges in the sexual solicitation and indecent liberties against a minor case against former Christendom College professor William Raymond Luckey. After hearing information from both sides in support of the amended complaint and plea agreement, including responses by the 73-year-old defendant to a series of questions from the bench, Judge William Sharp accepted the agreement as presented.

As a result, Luckey plead guilty to reduced misdemeanor charges of sexual battery of a minor and attempted sexual battery of a minor. Judge Sharpe then sentenced Luckey to a total of 24 months in jail, 12 months on each count, with all that time suspended minus the 18 days he spent in RSW Regional Jail in the wake of his June 25, 2021 arrest, three days after the incident occurred. He was released on a $50,000 bond after a second bond hearing at the Circuit Court level on July 12, 2021. He was initially denied bond following a hearing in Juvenile and Domestic Relations Court.

William R. Luckey at the time of his June 25, 2021, booking at RSW Jail on indecent liberties charges against a minor alleged to have occurred three days earlier. Photo RSW Jail website

Luckey was initially charged at the felony level with Solicitation of Prostitution from a minor less than age 16” and two charges of “Indecent liberties … of a child less than 15”.


Luckey was apologetic for the incident, telling the court, “I am absolutely sorry for what happened,” adding specific apologies to the victim and family and to his wife, the latter of whom he observed had been “put through hell” as a consequence of the incident. “I don’t know what got into me,” Luckey added of the offer of $10 to the under 15 years of age victim to “see” and “pat their hiney” as described in the arrest warrant.

A hint of “what got into” the defendant on June 22, 2021, was offered by defense counsel Thaddeus Furlong during his comments in support of the plea agreement. Furlong told the court that among the myriad health problems that his client battles cited during previous hearings, including consequences of past back and brain injuries, cardiac problems, and high blood pressure, Luckey was battling early signs of dementia at the time of the incident. He added that Luckey had undergone brain surgery in the intervening year since the incident occurred.

As he has at previous hearings in recent months, Luckey appeared frail, utilizing a walker to move cautiously about. However, his answers to the court’s questions were concise and responsive.
Outside the courthouse following resolution of the case, Furlong told Royal Examiner, “We are glad it’s over. Mr. Luckey suffers from progressive dementia – he doesn’t remember what happened or why. He is very, very sorry.”

In addition to the two years of suspended time, Luckey will be required to register with the Virginia Sex Offender Registry and serve 24 months probation.

In prefacing his acceptance of the plea agreement, Judge Sharp noted that Luckey had been facing “very serious felony charges” originally with “evidence in support” of conviction. However, he noted that an out-of-court resolution in such cases was often preferred by both sides to avoid the necessity of a minor child having to testify, with the potentially damaging effects rippling through the victim into their family.

Citing the support of the victim’s family for the plea agreement, Judge Sharp said, “I find this a reasonable and proper disposition of the case,” in accepting Luckey’s two guilty pleas to the amended, lesser charges.

William Luckey spent 18 days in jail in the wake of his June 25, 2021, arrest before being granted bail. He will spend no more time there in the wake of a plea agreement accepted by the court on Friday, June 24. It was noted that the minor victim’s family agreed with the offered resolution.

That a plea agreement was in the offing had been hinted at when both a May 16 hearing at which a trial date was expected to be set was continued, and that hearing was again continued on June 3.

“I think we are making progress toward resolving this case,” the Stafford-based Furlong commented on May 16, adding on June 3, “We’re very close.”

And now as of June 24, all involved can move on with the rest of their lives.

 

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POLICE: 7 Day FRPD Arrest Report 6/20/2022

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Suspect arrested in Frederick County murder

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The Frederick County Sheriff’s Office has made an arrest in the Tuesday, June 21 murder of a Kernstown man.

A media release from the office of Sheriff Lenny Millholland today stated that deputies were making a welfare check at the Fay Street home of Rufus Holland Tuesday morning when they discovered a blood-like substance on the front door.

After knocking on the door and getting no response, deputies entered the home and discovered the body of Rufus Holland in the living room. Lieutenant W.W. Gosnell said in a statement that an investigation determined that Holland was the victim of a murder, though no manner of death was released.

Michael Anthony Hill


Frederick County investigators determined, based upon collected evidence and interviews that Frederick County resident Michael Anthony Hill was a person of interest in the murder. The investigation revealed that the victim and Hill were acquainted.

Gosnell says in the release that investigators did not believe the suspect was a threat to the community, so the FCSO did not inform the public of the alleged murder or the suspected involvement of Hill as they attempted to locate him.

On June 22, officers located Hill in the city of Winchester, and he was taken into custody without incident around 9:00 pm, the release states.

Hill has been charged with second-degree murder and is being held at the Northwestern Regional Adult Detention Facility in Winchester, VA. Officials have not commented on a motive.

Hill is scheduled to have a bond hearing on Friday, June 24 at 11:15 am in Frederick County General District Court and a preliminary hearing on Aug. 30 at 2:00 pm.

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Grand Jury indicts Leadman in fatal 2021 ATV accident

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The Warren County Grand Jury on June 13 indicted Bentonville resident Jerrell Stanton Leadman,62, on two counts of felony child abuse related to the August 2021 ATV accident that claimed the life of Olivia Clatterbuck, 7, and injured her then-four-year-old brother.

Jerrell S. Leadman Jr, 62, of Bentonville, VA

The Grand Jury wrote in its indictment, regarding Count 1, “On or about August 10, 2021, in the County of Warren, Jerrell Stanton Leadman, Jr., did unlawfully and feloniously being a parent of, guardian for, or person responsible for the care of O.C., a child then under the age of eighteen years, did, by willful act or omission or by a refusal to provide the care necessary for the health of the said child, cause or permit the life or health of such child to be seriously injured, in violation of § 18.2-3-71.1(A) of the Code of Virginia, 1950, as amended.”

Regarding Count 2, “On or about August 10, 2021, in the County of Warren, Jerrell Stanton Leadman, Jr., did unlawfully and feloniously being a parent of, guardian for, or person responsible for the care of R.C., a child then under the age of eighteen years, did, by willful act or omission or by a refusal to provide the care necessary for the health of the said child, cause or permit the life .or health of such child to be seriously injured, in violation of § 18.2-371.1 (A) of the Code of Virginia, 1950, as amended.”


As Royal Examiner had previously reported, the accident occurred on August 10, 2021, at 6:45 pm. Leadman was driving a 2007 Polaris Ranger ATV on private property on Whitney Lane, according to Virginia State Police, who say Leadman was not able to navigate the terrain and overturned.

The ATV flipped and ejected Miss Clatterbuck, killing her on the scene. Her brother was transported to Winchester Medical Center and treated for minor injuries.
Leadman had minor injuries and was treated on the scene.

He was arrested on Aug. 11, 2021, and charged with one count of driving under the influence and two felony counts of child endangerment. He was subsequently released on Aug. 19, 2021, on a $75,000 bond and remains free.

Leadman’s DUI charge was nolle prosequi during a May 12, 2022, hearing in Warren County Circuit Court. The legal term means “to be unwilling to pursue” in Latin.

Royal Examiner reached out to Commonwealth’s Attorney John Bell Tuesday, regarding the DUI charge. Bell replied in an email,” The nolle prosequi was based on the results of the blood test, which established that his blood alcohol levels were far enough below the legal limit that he is presumed to have been not under the influence under Virginia law.”

Leadman, represented by Winchester attorney William “Beau” Bassler, is scheduled to appear at a Warren County Circuit Court hearing on Aug. 8 at 1:30 pm. He stands charged with two counts of felony child abuse with serious injury, a Class 4 felony.

Assistant Commonwealth’s Attorney Nicholas Manthos is prosecuting the case.

If convicted, the Bentonville man faces 2-10 years on each charge, as well as a fine of up to $100,000.

Leadman is not biologically related to the two children; according to Olivia’s father, Jonathan Clatterbuck, Leadman is Olivia’s mother’s ex-stepfather.

Clatterbuck stated Tuesday afternoon, “I just hope it’s a fair and honest trial, but the facts and situation should be looked over again because, in my opinion, the Commonwealth’s Attorney’s office dropped the ball on the charges. “

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