EDA Authorizes $25,000 of Its Own Assets to Fight Tran-ITFederal Appeal of Its State Appeals Court Liability Ruling

At a Special Meeting the morning of Friday, November 22, 2024, the still legally named Front Royal-Warren County Economic Development Authority (FR-WC EDA, EDA) Board of Directors unanimously approved a Resolution out of a 25-minute Closed/Executive Session authorizing the expenditure of $25,000 to retain legal counsel to oppose, if necessary, the Petition for Appeal filed in the Supreme Court of Virginia by Truc “Curt” Tran and IT Federal, LLC.

That legal counsel is the Sands Anderson law firm of Richmond that has handled and won in local court all the EDA civil litigations related to the circa 2014 to 2018 EDA “financial scandal” involving the unauthorized movement of EDA assets to the personal benefit of then EDA Executive Director Jennifer McDonald and others. In a Warren County Circuit Court civil case in July of 2022, a jury awarded the EDA $11,919,313.38, plus some interest and punitive payments from defendants Truc “Curt” Tran and his ITFederal LLC company. If we recall correctly, those additional payments could raise the Tran/ITFederal liability to around $14 million.

Tran and his company appealed that ruling to the state court level, where the appeal was overruled. Tran/ITFederal is in the initial stage of appealing that ruling to the Virginia Supreme Court level, where the grounds for the appeal are currently under review, according to EDA Board Chairman Rob MacDougall. There is a possibility the appeal could be rejected at the higher court level at this stage. If it is not rejected by initial court review, Friday’s Resolution would retain Sands-Anderson to argue that the higher court should, in fact, reject the Tran/ITFederal appeal.

Present for the meeting in the Caucus Room of the Warren County Government Center Friday was EDA board Chairman Rob MacDougall and members Bruce Townshend, Robert Cullers, David McDermott, and EDA attorney Rodney Young of the Timberlake-Smith law firm of Staunton, the latter two remotely.

Two perspectives of the EDA Board of Directors table as they prepare to go into Closed Session Friday morning to discuss legal options regarding the ITFederal/Truc ‘Curt’ Tran appeal of its State Appeals Court finding upholding the local court finding of liability of from $12-million to $14-million regarding their roles in the EDA “financial scandal”. Remote participants were logged in through the laptop computer on the table. Royal Examiner Photos Roger Bianchini

The EDA Resolution approved Friday morning states:

WHEREAS, the EDA obtained a jury verdict in the Circuit Court of Warren County, Virginia, against Truc “Curt” Tran (Tran) and IT Federal, LLC (IT Federal) and was awarded significant monetary damages against both defendants on July 28, 2022; and

WHEREAS, Tran and IT Federal appealed the verdict to the Court of Appeals of Virginia, which affirmed the judgment of the trial court on October 8, 2024, and

WHEREAS, Tran and IT Federal have filed in the Supreme Court of Virginia (the “Supreme Court”) a Petition for Appeal (Petition), alleging error by the Court of Appeals of Virginia and asking the Supreme Court to grant its Petition; and

WHEREAS, the EDA opposes the Petition and wishes to retain the law firm of Sands Anderson to represent it in taking all necessary steps to oppose the Petition, and Sands Anderson has agreed to such engagement upon the terms and conditions outlined in a Client Engagement Agreement to be entered into by the EDA and Sands Anderson; and

NOW, THEREFORE, BE IT RESOLVED THAT:

1/ The EDA Board of Directors does hereby agree to retain the law firm of Sands Anderson to represent it in opposing the Petition for Appeal filed by Tran and IT Federal in the Supreme Court of Virginia and

2/ The EDA Board of Directors does hereby authorize the Board Chair and Secretary to execute the Client Engagement Agreement with Sands Anderson to memorialize the terms and conditions of such engagement and representation.