After four hours of pre-sentencing testimony and arguments on Friday afternoon, Chad Ritchie was ordered to serve 20 years of a 55-year sentence imposed by Warren County Circuit Court Judge Clifford L. “Clay” Athey in the death of one, and beating of a second 22-month-old twin child in November 2017.
Ritchie, 28 at the time of his November 2017 arrest, entered Alford guilty pleas on the second day of his December 2018 trial on four charges stemming from the death of 22-month-old toddler Malachi Zimmerman and for non-fatal injuries inflicted to Malachi’s twin brother Micah on November 8, 2017. Ritchie was watching the children of his then girlfriend Tabitha Zimmerman at Zimmerman’s parents’ home where they shared a residence, while Zimmerman was on night-shift at Rubbermaid where both she and Ritchie worked and had met.
Following his choice to enter Alford guilty pleas to a charge of second degree murder in the death of Malachi; malicious wounding of Micah; and one count of endangerment of each child, Ritchie faced guidelines ranging from 15 years of actual incarceration on the low end to a high end of 20 years in prison, with a mid-range of 17 years. In an Alford plea a defendant admits the prosecution has enough evidence to convict without admitting guilt.
Asked by the judge if he had anything to say prior to sentencing, Ritchie hesitated before quietly saying, “No.”
The defense contended the cause of Malachi’s death was not being struck by Ritchie, but rather by a large and panicking man incorrectly administering CPR (Cardio Pulmonary Resuscitation) when he discovered Malachi unconscious and unresponsive in a bedroom where he left him to prepare a bath for the child after his earlier admitted striking of the children.
During Friday’s sentencing hearing defense attorney Jason Ransom reiterated his trial contention that the 6-foot-plus, 220-pound Ritchie had administered CPR as one would to an adult, with two hands and two arms thrusting fully at the abdomen of the child. After being treated by Warren County Fire and Rescue at the scene and in transport to Warren Memorial Hospital, Malachi Zimmerman was pronounced dead at the hospital. Cause of death was determined to be cardiac arrest brought on by internal bleeding from a ruptured intestine that flooded the child’s stomach cavity. See Related Story:
However, Layton countered that Ritchie claimed to be and apparently was certified in the administration of CPR – and that someone certified in CPR would not have made such a mistake.
“He was trained … he should have done better but he was freaking out,” Ransom told the court of the adult level of force he contended his client used in trying to revive a 22-month-old child.
At trial in December and again during the March 22 sentencing hearing the defense attempted to portray Ritchie as a loving father figure to the children who had one terrible lapse of anger management leading to an uncharacteristic outburst of physical violence against the twins.
“That particular day a parent (figure) who because he was overwhelmed … he lost his cool – when someone that size loses it, this is where we are. That child is gone forever and when Mr. Ritchie gets out of prison he will have to live with that,” defense counsel Ransom told the court.
“This has crushed him; this has crushed his spirit … what he did was wrong and he’s got to pay for it – the question is how hard,” Ransom asked. “I don’t think the court needs to teach him not to do this again. We would agree to 20 years if it repeatedly happened. But I think this was a one-time occurrence. This was the worst day in everyone in this family’s life. We ask for 15 to 17 years,” Ransom concluded in seeking a lower to mid-range time of incarceration.
However, Assistant Commonwealth’s Attorney Bryan Layton countered that the court should weigh the impacts on the real victims, Malachi and Micah, their mother and grandparents, rather than how Ritchie might be impacted by a few additional years behind bars.
As to Ransom’s question on how harsh a sentence his client should receive, for maternal grandmother Rosemary Zimmerman, who with husband Daniel is raising the surviving twin pending resolution of related charges against their daughter, the answer was harsh. In the day’s most emotional testimony Rosemary Zimmerman described the impact on the family.
“I was the last one to see him (Malachi) when he was carried up to the ambulance. You could tell he was dead. He was way past the color for normal … it happened in our house … they thought we were involved in this sickness,” she told the court, voice rising, starting to cry.
“The guy admitted he killed the baby and we’re suffering for it. I can’t see my daughter; and the kids (Micah and a half sister) can’t see her because of a court order against her … Malachi was dead before he got CPR,” his grandmother told the court.
Then turning toward Ritchie at the defense table, voice rising, Rosemary Zimmerman yelled, “You killed him!!! Give him the max; I don’t even know what it is at this point.”
Mitigation witnesses for the defense included Ritchie’s parents, siblings and friends who all described the defendant as good around children, including the twins from their experience. They also referenced Facebook photos appearing to indicate a positive relationship between Ritchie and the twins posted prior to the tragedy.
However, prosecutor Layton pointed to evidence, including the defendant’s own verbal and written interviews with authorities in the wake of Malachi’s death and his brother Micah’s treatment for injuries at the hospital the night of November 8, 2017.
“He was so upset the kids weren’t behaving the way he wanted them to that he took cigarette breaks to try and calm down,” Layton told the court. He pointed to the defendant’s description of events indicating that Malachi had lain down and cried for 10 minutes after being struck by Ritchie one of the earlier of three times the defendant admitted to hitting the child. Upset by that continuous crying, Ritchie returned to again strike the child, choking and body slamming him, Layton said, “Then he stopped crying – how hard to you have to hit a child to stop him from crying like that,” Layton asked the court.
“He (Ritchie) tried to minimize it from the outset,” Layton said of the defendant’s portrayal of events. “The defense says he was panicking. But look at the text he sent Tabitha Zimmerman – what does he tell her, ‘Get your ass home – we have a problem.’
“A dead child is not a problem; a dead child is a tragedy. He deserves far more than 20 years,” Layton told the court of the sentencing guidelines.
Noting the defendant’s age, Judge Athey observed that unlike Malachi Zimmerman “Mr. Ritchie will get a second chance” when he is released around age 50.
Following his sentencing of Ritchie, Athey set Monday for a pre-trial hearing on charges the twins’ mother faces related to the case. A three-day trial has been set for April 8-10 for Tabitha Zimmerman, 29, on two counts of cruelty and injuries to children revolving around the prosecution theory that the violence of November 8, 2017, was a culmination of a pattern of abuse by Ritchie that the mother was aware of and allowed to continue.
Her attorney John Bell was a spectator at both Ritchie’s trial of December 10-11 and Friday’s sentencing hearing. Bell agrees with the Ritchie defense team on one aspect of the case, that older bruises found on the twins were a result of the toddler’s active lifestyle, horseplay and rough housing with each other, rather than a long-term pattern of physical abuse by Ritchie, at least any pattern of behavior the children’s mother was aware of.
Judge allows Shaw-Sayre communications Discovery, but not third-party
FRONT ROYAL – Attorneys for Jennifer McDonald, Tom Sayre and one involved third party argued motions related to plaintiff Discovery filings and responses in Warren County Circuit Court late Wednesday morning. The motions involve McDonald’s $600,000 defamation lawsuit against Sayre filed in February.
Five months earlier in September 2018 while McDonald was still EDA executive director, Sayre filed a $25,000 defamation suit against McDonald. Both suits revolve around the name “Tom” accompanied by Sayre’s phone number found in McDonald’s yard following a reported vandalism on her property on June 15, 2017.
At issue Wednesday were responses or a perceived lack thereof to plaintiff McDonald attorney’s request for social media and other electronic communications records of Sayre and that third party, Royal Examiner Editor Norma Jean Shaw.
Sayre’s and Shaw’s first names, as well as Sayre’s phone number and other names and numbers were on a crumpled note pointed out by McDonald to Warren County Sheriff’s Office investigators responding to her report of a rock-throwing vandalism at her home at 9:02 p.m. Thursday, June 15, 2017.
The note portrays a multi-person conspiracy surrounding, not only incidents alleged to have occurred at McDonald’s Faith Way, county home in the May-June 2017 timeframe, but also an alleged May 18, 2017 break-in at the Kendrick Lane EDA office in Front Royal. The latter was a scene at which there was no forced entry apparent. The latter was a scene at which there was no forced entry apparent, and only three staff members, McDonald, Missy Henry and Marla Jones with keys.
On Halloween Day 2018, McDonald was acquitted of a misdemeanor charge of filing a false police report in the June 2017 vandalism incident in what some cynical observers have called a “Trick or Treat” – as in no available corroborating or motive evidence being presented – prosecution. The case was developed by the Front Royal Police before being turned over the Virginia State Police, based on information received in an already scheduled FRPD interview, at 10:30 a.m. Friday morning, June 16, 2017, with this reporter. That information was that McDonald told Bianchini about the vandalism during a lengthy 3 p.m. meeting in her EDA office the afternoon of June 15, about five to six hours before she reported it occurring.
Among the records McDonald attorney Lee Berlik was seeking in Discovery were three months of social media, online messaging and text communications – May 1 to July 31, 2017 – between Shaw and Sayre, Shaw and Mark Egger, Shaw and a colleague at Royal Examiner (who do you think) and Shaw and Commonwealth’s Attorney Brian Madden.
After much discussion and Shaw attorney David Downes invoking of the press privilege of source protecting, Judge Athey allowed discovery of any Shaw-Sayre communications, but not that of Shaw with a private citizen (Egger), a colleague at work (Bianchini) or the commonwealth’s attorney (Madden).
“Communications with the plaintiff are one thing … but where you cross the Rubicon is requesting communications with other parties. I understand your point that she may have been an accessory but her communications in her professional capacity” with third parties were off limits, Athey told Berlik in prefacing his decision in apparent agreement with Downes that media has a professional right to keep some source communications private in the conduct of their profession.
As for the apparent conspiracy alluded to in the note containing Sayre’s phone number, as well as that of former Town Manager Michael Graham and the names “Tom”, “Norma Jean”, “Matt” and “the Examiner”, Berlik admitted some question exists when he told the court, “Whether it is authentic or not remains to be seen.”
What Berlik did not admit was his client’s connection to any such questions.
In fact, in prefacing his dismissal of the misdemeanor filing a false police report charge against McDonald on October 31, 2018, Judge W. Dale Houff commented, “There is something obviously wrong about the note.”
Following his Discovery Motions decision Athey questioned attorneys on the trial date for the Sayre-McDonald defamation case scheduled in General District Court downstairs. Told August and that both sides have indicated an appeal of the verdict is likely, Athey set a hearing date for the McDonald defamation case on the Motions Date of September 18, at 9 a.m. The judge indicated the likelihood of setting a trial date on the McDonald lawsuit then and observed the two cases could potentially be joined at that point.
The alleged conspirators’ “note” with its names and numbers appearing to implicate “Tom”, “Norma Jean”, “Matt”, Graham’s 202 phone number, and even “the Examiner” is likely to play a big role in both trials.
The note and vandalism it is allegedly tied to, among other incidents of trespass and vandalism at McDonald’s home and the EDA office complex came at a time Royal Examiner staff, then-Councilwoman Bébhinn Egger (Mark Egger’s daughter), and others eventually including Sayre and county board colleague Archie Fox were raising questions about the validity of multiple EDA projects being forwarded by McDonald as EDA executive director.
Shaw, particularly, was deep into an investigation of large amounts of cash being used by McDonald in her personal real estate business transactions. Those real estate transactions, along with questioned EDA projects like ITFederal and Workforce Housing among others, lie at the heart of the EDA civil litigation now seeking recovery of $21.1 million in allegedly misrepresented, misdirected or embezzled assets.
Arrested by VSP on May 24, McDonald is now jailed without bond as a possible flight risk on four felony financial criminal charges, two of Fraud, Obtaining Money by False Pretenses in excess of $200; and two of Larceny-Embezzlement in excess of $200. Those appear related to the EDA civil suit “Afton Inn Embezzlements” allegations of falsifying work invoices to pay off credit card debts. The evidence on those charges appear fairly cut-and-dried evidentiary-wise compared to some other allegations in the EDA litigation.
The Special Grand Jury
However, as the civil defamation motions were being argued Wednesday on the second floor of the Warren County Courthouse, the Special Grand Jury convened to investigate potential criminality tied to the EDA civil litigation was meeting for what appears to be the first of several days of witness testimony this week.
Speaking of social media, the rumor of additional indictments being imminent have been floating on social media for weeks since those initial four indictments were handed down on May 24. One large question connected to any next round of sealed grand jury indictments is whether they will simply pile more on to McDonald’s legal plate, or add additional defendants into the mix.
Not directly related to the above question but more on the familiar faces sightings ledger, one encountered on the second floor of the Warren County Courthouse after the adjournment of the defamation hearing belonged to former County and EDA Attorney Blair Mitchell. Mitchell, who retired in April 2017, told media present he had testified for about an hour before the special grand jury but declined to elaborate on the nature of the questions he was asked.
But noting his retirement date and corresponding EDA business of the previous years, we can probably make an educated guess at some of those questions relating to Mitchell and McDonald’s interactions on projects cited in the Cherry Bekaert accounting investigation of EDA finances over the past decade. High on that list may well be Leach Run Parkway Easements, myriad other real estate transactions, not to mention the advent of the ITFederal and Workforce Housing Projects – (Come on, TELL US, Uncle Blair!!!)
Motions filed, August hearing date set in ‘Bawdy Place’ prosecutions
A hearing date of August 13, at 2 p.m., was set Tuesday for pre-trial motions in three cases related at least indirectly to former Front Royal Mayor Hollis Tharpe’s May 2018 visit to a Biggs Drive massage parlor. The cases of Cynthia Atkinson Bailey, her daughter Brandy Nicole Atkinson and son Jesse Thomas Atkinson have been joined for trial according to defense counsel David Downes.
Downes filed motions, including discovery, during the Tuesday, June 18, Warren County General District Court morning docket. The criminal complaint against Bailey and her co-defendants alleges that massages of a sexual nature were a prominent part of the services “menu” being offered at the Biggs Drive address.
A gigolo, I mean “Giglio Motion” filed by Downes Tuesday sought information on potential prosecution witness Tiffany Amber Wymer. The motion cites a felony charge “on or about December 6, 2018” for “possession with intent to distribute marijuana” that according to the defense motion was dropped by prosecutors on May 28, 2019 in Frederick County General District Court.
Downes questions if the resolution of that case related to Wymer’s anticipated testimony in this (the Bailey et al) prosecution and “whether she has received immunity from prosecution for” a variety of other possible charges, including “her fraudulent welfare applications … operating an illegal sex chat website” and “prostitution charges”. Downes further asks how many incidents of prostitution Wymer may have received immunity for.
Bailey, 55, was arrested on May 15 by Front Royal Police along with her daughter, son and stepson Joshua Allan Stamper. Bailey’s charges include maintaining a “bawdy place” (defined as gross, indecent or overly graphic establishment), receiving money from earnings of prostitution, prostitution, and cruelty to children, the latter charge related to the presence of a juvenile in the residence who “answered phone calls, arranged appointments and walked clients to the rooms” according to warrants. Bailey’s relations’ charges relate to various jobs they performed at what was cited as an unlicensed massage parlor operating at the business address of Blue Valley Services.
While Tharpe has admitted to visiting the business he has asserted it was for legitimate massages on his 67-year-old body. Tharpe was indicted on a misdemeanor solicitation of prostitution charge on April 15. That day he put himself on administrative leave and four days later announced he would resign as mayor, effective May 2. Tharpe explained his decision as preventing his legal situation from interfering in the conduct of Town business.
Tharpe was in court Monday, June 17, to have motions and trial dates set in Warren County Circuit Court where his misdemeanor solicitation case is being heard due to the direct indictment by a Warren County Grand Jury.
It was a grand jury, ironically perhaps, chaired by now Interim Front Royal Mayor Matt Tederick.
Two days after her arrest, Bailey attorney Downes issued a press release asserting that his client’s prosecution was “retaliatory” and “selective” due to her assertion to authorities that she would plead her Fifth Amendment right not to self-incriminate if asked to testify regarding clients, including Tharpe. In his release Downes noted that Bailey had initially been arrested on June 7, 2018 on a charge of prostitution. That arrest came one week after the Tharpe massage parlor incident cited in his indictment. That charge was dropped by the commonwealth on October 2, 2018.
Downes release led to responses from both Tharpe Special Prosecutor Heather Hovermale and FRPD Chief Kahle Magalis denying any inappropriate actions related to the massage parlor warrants
Trial date of Oct. 25 set in Tharpe solicitation case – prosecution seeks change of venue
Attorneys for former Front Royal Mayor Hollis Tharpe say they will vigorously fight a change of venue request made by Special Prosecutor Heather Hovermale during a Monday hearing. Tharpe was in court with attorneys David Hensley and Beau Bassler on June 17 to set a trial date on his misdemeanor solicitation of prostitution charge related to a May 31, 2018, visit to a massage parlor on Biggs Drive.
In what was likely his last hearing on the case Judge Clifford L. Athey Jr. set a trial date of October 25, at 9 a.m., for the jury trial requested by Tharpe’s attorneys and July 15, at 2:30 p.m., for arguments on the prosecution’s change of venue request.
Bassler and Hensley called the special prosecutor’s request for a change of venue on a misdemeanor case “extraordinary” in their legal experience.
“Justice is supposed to be local to where a community is affected by crime unless there are unusual circumstances that would make a fair hearing of the case questionable,” Tharpe’s legal team observed. Obviously they do not believe Tharpe’s high profile in the community as a former mayor and councilman, not to mention long-time ice cream man, fits the “unusual circumstance” criteria, particularly in a misdemeanor case of this nature.
Tharpe’s high profile in the community was illustrated in the wake of Athey’s setting of the hearing and trial dates – “Well, someone will be here to see you but it won’t be me,” Athey said to Tharpe of the July 15 hearing date.
“You have a good time in Richmond,” Tharpe replied to another former Front Royal mayor, turned state delegate, turned judge who will be leaving for a seat on the Virginia Appeals Court this September.
When Athey asked Tharpe’s legal team if they wanted speedy trial statutes in play in the setting of a trial date, Hensley replied for his client, “He would like a speedy trial.”
The judge’s setting of a date four months away that fit all involved party’s schedules means a verdict will be rendered about two weeks before the likely November date of a special election to fill the mayor’s seat for the duration of Tharpe’s term, which expires at the end of 2020. That seat is currently occupied by long-time Republican activist and former county supervisor Matt Tederick, who was appointed interim mayor on May 28 by a 4-2 vote, Tewalt and Thompson dissenting. Tederick has said he does not plan to run for the mayor’s office in the special election.
While proclaiming his innocence following his indictment on April 15, Tharpe initially placed himself on administrative leave and then announced four days later on April 19 that he would resign as mayor effective May 2. Tharpe explained his decisions as not wanting the charge against him to distract town government from the conduct of its business pending a resolution of his case. The 67-year-old Tharpe has called the misdemeanor charge against him “embarrassing” and “baseless”.
A Virginia State Police press release announcing Tharpe’s pending indictment in April indicated Tharpe’s charge stemmed from an investigation launched at the direction of the Virginia Attorney General’s Office.
That there was an investigation into Tharpe went public on August 30, 2018, when Warren County Commonwealth’s Attorney Brian Madden filed notice he would recuse himself from any possible prosecution relating to an “Investigation Concerning Hollis Tharpe”. Special Prosecutor Hovermale works out of the Winchester Commonwealth’s Attorney’s office of Marc Abrams, which was handed the case following Madden’s recusal announcement.
RSW superintendent explains McDonald transfer to Fairfax jail
On Friday, Rappahannock-Shenandoah-Warren County Regional Jail Superintendent Russ Gilkison confirmed the transfer of high-profile inmate Jennifer McDonald to the Fairfax County Adult Detention Center four days earlier, on Tuesday, June 11. McDonald was arrested by Virginia State Police on May 24 on four felony fraud-embezzlement charges related to the financial investigation of the Front Royal-Warren County Economic Development Authority.
The former EDA executive director has twice since been denied bond, being deemed a flight risk by Judge Clifford L. Athey Jr. After 10 years heading the EDA, McDonald resigned under increased financial scrutiny from her board of directors on December 20, 2018. According to EDA officials in her resignation email she admitted liability for the return of $2.7 million in assets to the EDA. However subsequent EDA civil litigation filed March 26 now seeking recovery of $21.1 million dollars alleges McDonald’s role in the loss of much more than her admitted liability.
Gilkison said the move was made to normalize McDonald’s jail experience.
“This will allow her to get into the general inmate population. She’s been in protective custody here due to the high-profile nature of her case,” Gilkison told Royal Examiner of the isolated nature of McDonald’s confinement so far.
The RSW superintendent said he had been in touch with McDonald’s criminal attorney Peter Greenspun for about a week prior to the move. Gilkison said the Fairfax City-based Greenspun supported the move and is now in much more convenient proximity to his client while she is incarcerated.
A hearing in which McDonald is slated to enter pleas in her criminal cases is scheduled for July 17 in Warren County Circuit Court.
Asked about costs to RSW of McDonald’s move to another facility, Gilkison said the Fairfax jail is not charging RSW for the transfer.
“It’s called a courtesy hold and we all do it for each other,” Gilkison said of the transfer of inmates for various reasons between area jails. “We would pay for any medication or medical costs but they aren’t charging us to house her.”
Asked if the move could indicate coming arrests of alleged co-conspirators in the EDA financial scandal that has shaken this community, Gilkison said only that he had heard the same rumors that many have about sealed special grand jury indictments, adding, “but not from reliable sources.”
Front Royal Police detail another pedestrian-fatal South Street accident
Information released by the Front Royal Police Friday, June 7, indicates that the 65-year-old female Front Royal resident killed Thursday, June 6, on South Street, was legally crossing the street within one of the Town’s newer, painted pedestrian crosswalks.
The FRPD press release reads in full:
“On June 6, 2019, at 10:28 p.m., the Front Royal Police Department responded to a report of a pedestrian versus vehicle accident on South Street. A 2019 Buick 4 door, driven by Herman Melvin Vohs, Jr., 75-year-old Front Royal resident, was traveling westbound on South Street when he struck Ethel Elaine Blackwell as she was crossing the street. Blackwell, 65, a Front Royal resident, was pronounced deceased at the scene by medics. Preliminary investigation into the fatal accident indicates that Blackwell was in the crosswalk at the intersection of Acton Street at the point of impact.
“No further information will be released at this time, pending further investigation. Once all information is collected, the case will be staffed with the Warren County Commonwealth’s Attorney Office.
“If you have any information related to this incident, please contact Traffic Enforcement Officer J. Noland at 540-635-2111 or firstname.lastname@example.org.”
Town Council discussion surrounding its STOPS (Smart Towns Observe Pedestrian Safety) Program implemented in the wake of three pedestrian deaths within a one-year period a couple years ago indicates pedestrians have the right of way to moving traffic while in those painted, designated crosswalks.
However, Ethel Elaine Blackwell’s death yesterday points to ongoing dangers for pedestrians on high-traffic volume streets, particularly during rush hours or after dark, with or without marked crosswalks.
South Street and North Shenandoah Avenue at town entranceways populated by commercial strips in proximity to residential neighborhoods have been the two most dangerous roads for town pedestrians.
How this most recent pedestrian fatality will impact future council decisions on crosswalk implementation with or without accompanying signage or pedestrian-activated stop lights remains to be seen.
Roles of McDonald, EDA Board & Goodlatte described at EDA hearing
The level of authority given former Front Royal-Warren County Economic Development Authority Executive Director Jennifer McDonald to pursue client contact leads and a consequent lack of oversight from her board of directors was a primary issue in testimony and closing arguments on Friday, May 31.
In fact, some professional tension was palpable between McDonald defense counsel Jay McDannell and lead EDA attorney Cullen Seltzer as they summarized the cases they had presented over 2-1/2 days leading to closing arguments beginning at 12:45 p.m., Friday afternoon. The result of that third and final day of the EDA civil suit motions hearing was previously reported in Royal Examiner, below:
In beginning his rebuttal to the plaintiff attorney’s closing statement McDannell referenced what he termed “vitriolic attacks on my client”. They were attacks he said he had tried not to respond in kind to – “That ends today” he told the court.
And he wasn’t kidding – McDonald’s attorney called the plaintiff case “craven and stupid” adding, “They put the cart before the horse” in an attempt to cover what he called “a failed filing” of the EDA $17.6 million civil action against nine defendants alleged to have engaged with McDonald in a wide, if compartmentalized conspiracy to embezzle or misdirect millions of dollars in EDA assets.
“The largest claim is a breach of contract claim for a contract that has never been breached – and it is against someone else,” McDannell noted of the $10 million loan the EDA secured from United Bank for ITFederal LLC and its CEO Truc “Curt” Tran.
In fact, a significant portion of former EDA board member Ron Llewellyn’s testimony, which was by far the lengthiest of four current or former board members called to testify Friday, addressed the process and rationale in acquiring that loan.
A nine-year board member prior to his resignation effective March 23, Llewellyn told the court that the ITFederal project “was considerably different than any other project we ever worked on … We were all excited about the first Brownfield site project,” Llewellyn noted of the first commercial client drawn to a planned 147-acre business park on the former 467-acre Avtex federal Superfund site in the Town of Front Royal.
Llewellyn testified he had concerns about the project early on due to an inability to find any substantive information about the company and its alleged $140-million or so in annual federal government contracts online. However, he noted that the EDA’s executive director always assured him she had verified the validity of the information about ITFederal and its government contracts.
“Did you ask how she verified it?” McDannell pressed Llewellyn on cross examination.
“No, not precisely,” Llewellyn admitted.
“Maybe because it was brought to us by the congressman due diligence wasn’t done. I couldn’t find anything online but Jennifer always had an explanation, I thought was through the congressman,” Llewellyn said.
“So it got credibility from Congressman Goodlatte – what would you say the impact of that was?” McDonald’s attorney asked.
“More than it should have,” Llewellyn testified about three-and-a-half to four years down the road from then U.S. Congressman Robert Goodlatte’s championing of ITFederal in 2014-2015 as a $40-million investor who would bring 600-plus high-paying tech jobs to this community.
In fact, Llewellyn recalled a conversation with Goodlatte at the October 2015 ITFederal ribbon-cutting here launching the idea of a $10 million loan to Tran’s company. Llewellyn said he, McDonald, then-EDA Board members Patty Wines, who was board chair, and Jim Eastham who was in banking professionally, were in the group with whom Goodlatte first broached the ITFederal loan idea.
Llewellyn testified that McDonald reported back that when first offered the loan, Tran had balked. However, the EDA decided to continue pursuing the loan after Goodlatte explained he wanted to be able to promote the Avtex Brownfield site “to other prospects by saying, ‘We not only got you this nice piece of land but financing for your project too’.
“So Jennifer went back to Tran and explained that Goodlatte said it needed to be done anyway (whether he needed it or not), and he says, ‘Okay’,” Llewellyn said of the process he recalled achieving the ITFederal bank loan.
What Llewellyn didn’t explain, and wasn’t really asked to at this hearing level, was why the EDA board would agree to extend a 30-year payback on a $10-million loan to Tran that the EDA has a 7-year balloon payment due to First Bank & Trust of Abington on. For you non-bankers out there, on the surface, those conflicting schedules mean the EDA must pay the loan back to the bank in full after seven years, while Tran has another 23 years to pay the balance on the $10 million back to the EDA. Talk about economic development working for YOU!
However, EDA Attorney Dan Whitten explained to Royal Examiner that the EDA has the option of renegotiating the monthly amount of Tran’s payback; and will likely attempt to refinance its loan payment to First Bank & Trust after those seven years. So if things go well the EDA may be able to continue to have Tran’s payments cover the cost of a refinanced bank loan. Whitten said the discrepancy likely occurred because the EDA-Tran terms were signed in September 2015 when the Town bridge loan was made to the EDA, and the EDA-First Bank & Trust terms were signed three months later when the bank loan was realized in December 2015.
And on the bright side, as Town Councilman Eugene Tewalt likes local media to stress, the Town of Front Royal DID get its twice-extended to three-months $10-million “bridge loan” to the EDA and Tran back in full when the loan through First Bank & Trust of Abingdon was accomplished. However as we also recall, the Town did lose out on two months of interest totaling around $8,000 because the term of the “bridge loan” was supposed to be a month and the bridge loan arrangement only included one month’s payment equal to what the Town had been collecting in monthly interest on those $10-million dollars in an investment account.
But back to the civil litigation hearing’s closing arguments of May 31, 2019: citing EDA “board failings of oversight” McDannell told the court of his clients’ culpability, “Her actions are attributable to them – not that she did everything right, but did she misunderstand the authority her board had given her?” McDannell asked rhetorically with a clear indication of his thoughts on an answer.
However in the plaintiff’s closing statement delivered first, Seltzer pointed to the testimony of the four former and current EDA board members heard that day. They were asked in to testify about Defense Exhibit 8 offered the previous day to illustrate board approval of a McDonald purchase of up to $2.5 million for potential use as an industrial cattle farm operation by a Tran company, Front Royal Farms LLC. Testimony indicated the planned Tran operation would produce beef to be sold in the Far East, particularly to Vietnam, Tran’s native country.
Former EDA Treasurer William Biggs, current Vice-Chairman Bruce Drummond, current Front Royal Vice-Mayor William Sealock, and Llewellyn all testified that they had not previously seen the Closed Session, Confidential Resolution authorizing McDonald to spend up to $2.5 million on a property for the cattle ranch land purchase on Trans’ behalf. That was the defense exhibit EDA Attorney Dan Whitten described during his Thursday testimony as a “fabricated document” produced by McDonald.
All four past and present EDA board members said Friday that while it appeared their signatures were on the document, they had not previously seen that particular resolution. They also verified Whitten’s testimony of the previous day that such a resolution would not be signed in closed session or likely be marked “Confidential” as it was.
The quartet of EDA board members also expressed varying degrees of knowledge or a lack thereof about EDA board discussion of Tran’s prospective Front Royal Farms operation. However, all agreed whatever discussion had occurred was far from the authorization of millions of EDA dollars to be committed to the purchase of land for such an endeavor.
Previous hearing testimony indicated that those parcels referred to as “the Buck Mountain properties” were sold back to the original owner William Vaught Jr. a month or so after purchased by McDonald real estate company DaBoyz LLC at a $600,000 loss.
“Even after she left (the EDA) she continued to conceal against those board members we heard from today. She betrayed that trust in the most pernicious ways,” Seltzer told the court in summarizing his case for attachment of $3.17 million of McDonald or her real estate companies’ assets.
Of Defense Exhibit 8, the EDA attorney called it “unbelievable, bare-faced contempt”, not only of her former board members but of the court in its attempt to render a judgment on the freezing or releasing of McDonald assets related to the civil litigation.
“She has attempted to deceive the court – I’ve never seen anything like that in a courtroom,” Seltzer said of the introduction of an apparently fraudulent document in support of a defense motion not to enjoin defendant assets.
The Sands-Anderson attorney made it clear he was not implicating his legal adversary in that deception – “He has been used by his client to perpetuate shocking deceit,” Seltzer told the court.
However, McDannell disputed that assessment, noting his client’s agreement to withdraw the document and her voluntary assertion that two properties under her control were being held in a “constructive trust” for the EDA.
He also pointed out to the court that his client had not tried to convert her real estate assets into cash and flee prior to facing the civil and criminal charges now hanging over her head, those latter charges leaving her incarcerated as a flight risk.
As reported in our above-linked initial story of the court ruling, Judge Athey took a middle ground in attaching some McDonald cash and real estate assets and not others, on the latter front leaving those co-owned with other family members alone, and on the former leaving her funds to pay for her defense against the felony criminal charges she faces.
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