RICO CLASS ACTION COMPLAINT against PNCBANK, et al.
UNITED STATES DISTRICT COURT FOR THE
CIVIL ACTION, FILE NUMBER: 94-2883 (HLS)
LEON R. DONGELEWICZ and MARGARET J.DONGELEWICZ,
FIRST EASTERN BANK, N.A., a Corporation Organized Under
DEMAND FOR JURY TRIAL
The Plaintiffs by and through their attorneys, Antao & Chuang, for their Complaint against the Defendants state as follows:
PARTIES AND RELATIONSHIPS
[paragraphs 1 to 27, relating to addresses of parties, omitted]
28. PNC Bank Corp.: PNC is a Pennsylvania corporation with its principal executive office at One PNC Plaza, Fifth Avenue and Wood Street, Pittsburgh, Pennsylvania 15265. PNC is a bank holding company registered under the Bank Holding Company Act of 1956, as amended, and is principally engaged in the business of managing and controlling banks and activities closely related to banking.
CLASS ACTION ALLEGATIONS
29. This action is brought by plaintiffs as a class action, on their own behalf and on behalf of all others similarly situated, under the provisions of Rules 23(a) and Rule 23(b)(2) and/or 23(b)(3) of the Federal Rules of Civil Procedure, for damages, injunctive and declaratory relief, and relief incident and subordinate thereto, including costs and attorneys' fees. This action is divided into five counts, as follows:
[paragraphs 30 to 35, relating to technical class action allegations, omitted]
CLASS ACTION UNDER THE RACKETEER
36. a. Plaintiffs repeat and reallege the allegations contained in paragraphs 1 to 36 of this complaint as fully as if set forth here.
37. COUNT I is brought by all plaintiffs as a class action against all defendants.
38. This Court has jurisdiction over this claims for relief under 18 U.S.C. sec. 1964(a) and 1964(c); and 28 U.S.C. sec. 1331 .
PERSONAL JURISDICTION AND VENUE
39. Personal jurisdiction and venue are predicated upon 18 U.S.C. sec. 1965(a) and (b) and 28 U.S.C. sec. 1391(b) since the Defendants are residents of, have an agent or agents, or transact their affairs in the District of New Jersey, and the acts and occurrences in furtherance of the claims alleged herein arose in the District of New Jersey, and because the ends of justice require that other parties residing in other districts be brought before the court.
40. The land comprising approximately 3,856 acres and located in four townships in Schuylkill and Luzerne Counties in Pennsylvania was subdivided on or about 1971, under the name VALLEY OF LAKES, by High Vista, Inc., a Pennsylvania Corporation. A copy of the "DECLARATION OF HIGH VISTA, INC. EXCEPTIONS, RESERVATIONS, COVENANTS, RESTRICTIONS AND CONDITIONS FOR VALLEY OF LAKES DEVELOPMENT" as recorded in Luzerne County, Pennsylvania on November 15, 1971 in Book 1735 at Page 269 to Page 272 is annexed hereto and made a part of this complaint, and marked "Exhibit 1-1 to 1-4."
41. Sometime in 1974, one Jack Halperin and Philip Cohen purchased High Vista Inc. and continue to market lots under the name "Valley of Lakes", and adopted a "black eagle" as a logo. A copy of the Property Report effective June 24, 1976, of High Vista, Inc. for the Valley of Lakes Development filed with the Office of Interstate Land Sales Registration, U.S. Department of Housing and Urban Development is annexed hereto and made a part of this complaint, and marked "Exhibit 2-1 to 2-29."
42. On or about August 4, 1980, Jack Halperin of High Vista, Inc. was indicted for mail fraud and violations of the Interstate Land Sales Full Disclosure Act (15 U.S.C. 1701 et. seq.) in connection with the sale of lots in the "Valley of Lakes," inter alia, for charging maintenance fees for services not rendered, promising to complete "Lake Algonquin," a proposed 80-acre lake, complete with dams, promising to complete a nine-hold golf course and/or eighteen-hold golf course, complete with all fairways and greens, promising to complete the road system, water system, sewer system, when no such improvements were ever made.
43. A copy of the Federal Grand Jury Indictment against Jack Halperin and Philip Cohen, of High Vista, Inc., dated July 25, 1980 is annexed hereto and made a part of this complaint, and marked "Exhibit 3-1 to 3-24." A copy of a newspaper article titled "Valley of Lakes developers indicted for fraud," published on or about July 30, 1980, in the Hazleton Standard Speaker is annexed hereto and made a part of this complaint, and marked Exhibit 4.
44. After the indictment of the principals of High Vista Inc., the mortgage was foreclosed and Meridian Bank purchased the land at Sheriff's Sale. Maintenance fees based on Valley of Lakes subdivision were no longer collected by the bank. The enforcement of the Covenants and Restrictions was abandoned.
45. In order to take responsibility for the maintenance of the subdivision in light of the default of the developer, a property owners association, VOLCA was organized on or about December 23, 1976. A copy of the Articles of Incorporation of the VALLEY OF LAKES CIVIC ASSOCIATION, as a non-profit Corporation, under the laws of the Commonwealth of Pennsylvania is annexed hereto and made a part of this complaint, and marked Exhibit 4A-1 to 4A-4. A copy of the current BYLAWS of VOLCA are annexed hereto and made a part of this complaint, and marked Exhibit 4B-1 to 4B-24.
46. CBG purchased the land on or about September, 1986. The original general partners were Frank Cedrone, a New Jersey resident, and a Sicilian construction company, SILEC SPA of Torino.
47. While CBG declared that they had "bought" the "Valley of Lakes" subdivision, in truth and fact they had only bought land like any other purchaser in the area. CBG did not purchase any property interest, or assignment of any type, or merge with High Vista, Inc., or any principal thereof.
48. CBG filed numerous property statements with HUD, and began a massive national media campaign, including television, radio, newspaper, direct mail, billboard, in home presentations, which touted the "Valley of Lakes" as the "premier resort in the NorthEast." A telephone boileroom controlled the sales operation from a boileroom in Bellmawr New Jersey.
49. On or about March 30, 1992, CBG Ltd. filed a petition for relief pursuant to Chapter 11 of Title 11 of the U.S. Code. To this day, it continues to maintain its control over the area, which it refers to as "Valley of Lakes", as a Debtor-in- Possession through its association with First Eastern Bank, N.A., and over the affiliated companies, Oneida Water Co. and Valley Utilities Co. Inc. As discussed in detail, infra, numerous purchasers of lots were defrauded by the misrepresentations of C.B.G. Ltd. They were sold on the expectation of luxurious lifestyle. Many purchased "lake front" properties on the promised "Lake Algonquin" which has never been completed. Many of these purchasers were giving written guarantees which were breached. Others purchased lots adjacent to the "Arnold Palmer designed and managed golf course" which has never been completed. Others purchased lots which have never had their promised improvements, such as sewer and water hookups completed, or never had their roads paved. Numerous property owners who built houses suffer from frequent sewer problems, water problems, and road problems.
(A) SCHEME TO INFILITRATE AND CONTROL THE AREA KNOWN AS "VALLEY OF LAKES"
(H) FIRST EASTERN BANK'S SCHEME TO CONCEAL INSOLVENCY OF CBG LTD.
TO CONTINUE RACKETEERING USING CHAPTER 11 BANKRUPTCY
OF FIRST EASTERN BANK TO OPERATE AND MANAGE THE
(K) SCHEME OF FIRST EASTERN BANK AND DEFENDANTS TO CONCEAL RACKETEERING ACTIVITY PRIOR TO ITS MERGER WITH P.N.C. BANK AND TO CONTINUE PATTERN OF RACKETEERING INDEFINITELY
SUMMARY OF EACH DEFENDANT'S ASSOCIATION WITH THE RACKETEERING ENTERPRISE AND PARTICIPATION IN THE PATTERN OF RACKETEERING ACTIVITY.
PRAYER FOR RELIEF
WHEREFORE the Plaintiffs pray on behalf of themselves and all similarly situated persons for judgment against defendant as follows, in general:
1. Issuing an Order certifying the Classes as set forth herein and designating the plaintiffs and their counsel as the representatives thereof;
2. Compensatory damages, for a sum duly trebled, plus interest;
3. Punitive damages;
4. Declaratory and injunctive relief;
5. Reasonable attorney's fees;
6. Together with all costs and expenses, and such other further relief as the court deems proper.
Plaintiffs demand a trial by jury with respect to all issues so triable.
Roger S. Antao (RA-5059)
Address: Antao & Chuang