The Best & Worst of 2011

by Arkansas Business Staff  on Monday, Dec. 26, 2011 12:00 am  

Best Case of Gold Fever
Joe Blankenship discovered it is easier to spend money than make it, and that leveraging assets in losing investments speeds up the process of blowing through money. The former Little Rock businessman turned to a time-honored vehicle to restore his flagging fortunes: gold mining.

Blankenship mined hundreds of thousands of dollars from individuals who loaned him money to recover a cache from Yamashita's gold, a legendary treasure trove of World War II booty allegedly amassed by the Japanese during their Asian conquests.
Instead of getting a hefty payday from Blankenship for helping him, the lenders/investors got empty-handed excuses.

Worst 8-Ks
When something "material" happens to a publicly traded company, it is required to file a form called an 8-K with the Securities & Exchange Commission. On the first business day of 2011, Home BancShares Inc. of Conway filed a particularly painful 8-K announcing additional loss reserves of close to $60 million, including $23 million in debts clearly associated with convicted former lawyer Gene Cauley and almost $6 million confirmed to be associated with the unfolding bond fraud scam operated by Kevin Lewis. The next day, Bank of the Ozarks Inc. of Little Rock filed an unusual - some might say opportunistic - 8-K announcing its upcoming earnings release and, oh by the way, pointing out that it had no exposure to fraudulent rural improvement district bonds that were plaguing several other Arkansas banks. The next week, Simmons First National Corp. of Pine Bluff filed an 8-K saying it had made one loan secured by the phony bonds but its exposure was less than $350,000.

Best Long-Running Lawsuit
An Arkansas civil fraud case that turned into a criminal case in federal court in Mississippi celebrated its 10th anniversary in April 2011. The case against Arkansas agri wheeler-dealer Jimmy Winemiller et al still hasn't gone to trial over the sale of the ironically named Straight Creek catfish farm. The criminal component of the long-running, meandering litigation is scheduled to go to trial on Feb. 27, marking the 16th time a courtroom date has been set in the five years since the indictment.

Worst Case of Father Knows Best
Lying and cheating investors as a shortcut to living large isn't your normal family tradition. But then the Rand family, formerly of North Little Rock, isn't your average family. Tony Rand passed along a legacy of fraud to his five sons: Wayne, Jeff, Greg, Mark and Bill. The elder Rand was sentenced to seven years in prison in 1991 for churning $17 million through his would-be 400-screen movie theater chain. Twenty years later, he and his boys were busted for scamming oil and gas investors out of more than $110 million.

Worst Judicial Tongue-Lashing
U.S. District Judge Billy Roy Wilson is routinely described as "colorful," and his red-facedness fairly leaps out of his transcribed words to Rose Law Firm attorney Ryan Solomon, whose client, USA Drug scion Jason LaFrance, had exhausted every attempt to avoid sitting for a deposition in November.

Even the presence of LaFrance's 1-year-old son in the garage where the deposition was ultimately held didn't dissuade Wilson. "Well, I'll tell you what you're required to do. You're required to have this damn deposition. And with a baby raising Cain like that by the court reporter is not the way to do it. Now, figure out some way to get it done. Am I going to have to send a marshal out there to conduct this deposition?" the judge said in the last of four cellphone conferences in a matter of hours.

When Solomon tried again to postpone the deposition for lack of a babysitter, Wilson had another suggestion: "Where is your partner? Why can't he come out and let you go and hold the baby in another room? This is - this is an outrage. ... I've had enough of it. Now, you get your partner out there, or get a nurse or somebody, and conduct this deposition like an upright lawyer." Wilson later sanctioned Solomon.

Worst Labor Day Party
Precisely what happened at this night-before Labor Day party is unclear, but it appears to have involved illegal drugs and hot tub lounging in Maumelle.
We do know that the homeowner and host, Christopher Barbour, told police Sept. 5 that Brett Cummins, then a meteorologist for KARK-TV, Channel 4, and Cummins' friend Dexter Williams of Mountain Pine "began to drink and use illegal narcotics."
Cummins awoke in a drained tub on Labor Day morning, and next to him was Williams' naked corpse, Barbour said.

The Maumelle police released only a preliminary autopsy of Williams' body that revealed the 24-year-old died of asphyxiation.  

Best News for Rice Farmers
That would be the $750 million settlement agreement that U.S. rice farmers, including a number in Arkansas, and Bayer AG reached this summer over contamination of the U.S. rice supply by Bayer's genetically modified rice.

Best Time to Buy

For signs that the economy was improving, one has to look no farther than Arkansas Business' list of $1 million homes bought in Pulaski County in 2010.

That year 22 homes were bought, up from 14 in 2009. While most of the buyers received a deal, the sellers ended up on the losing end. Eight homes in 2010 sold for less than what was originally paid for them.

Worst Freezer Burn
After 79 years in business, Yarnell Ice Cream Co. of Searcy closed its doors on June 30, leaving about 200 out of work. It later filed for Chapter 7 bankruptcy protection and listed $15.7 million in debts and $8 million in assets.

Schulze & Burch Biscuit Co. of Chicago bought most of Yarnell's assets for $1.34 million at an auction and has indicated it will restart its freezer to make more Yarnell's ice cream.

Worst Place to Work
Several exotic dancers are suing their boss at Visions.

The reason? Their boss at the North Little Rock nightclub allegedly misclassified the dancers as independent contractors rather than employees so he wouldn't have to pay minimum wage.     

 

 

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