UPDATE: Courts asking for portion of casino profits

September 14, 2009


Federal bankruptcy court attorneys plan to ask for a portion of proceeds of a proposed Indian casino to be available to reimburse creditors of bankrupt North County developer Kelly Gearhart.

In June, Ohio Federal Bankruptcy Trustee Harold A. Corzin filed a fraud complaint against local attorney Robert “Grigger” Jones, as well as Chris Molina, Daniel Phillips, and the group’s Pejihota LLC for allegedly hiding assets for Gearhart, who is suspected of defrauding investors out of millions of dollars.

The trustee alleges that Gearhart transferred $1 million to $1.5 million into an LLC working to finance an Indian gaming casino in either San Luis Obispo County or Monterey County at a time Gearhart was insolvent with the “intent to hinder, delay, or defraud creditors.”

Responding to the trustee’s claims, the defendants deny allegations that they intentionally caused damages to the creditors of the Gearhart bankruptcy. The group stated that its business venture “had no value” at the time Gearhart resigned as a member of Pejihota LLC, according the defendants joint answer to the complaint filed last month.

In regards to claims that their past relationships with Gearhart subjects the ex-business partners to greater scrutiny by the court, the defendants say they do not have sufficient information to answer the allegation of an insider relationship “and therefore deny the same.”

Trustee attorney Michael J. Moran said the trustee and his attorneys were still conducting discovery and planned to ask that the defendants pay monies for a portion of Gearhart’s bankruptcy.

In addition, if the defendants are successful in constructing a local Indian gaming facility, the trustee plans to ask the court to require additional payments to help reimburse Gearhart’s creditors.

The Pejihota members expect to reap 40 percent of all gaming proceeds for a period of seven years with an option to extend for an additional seven years in exchange for financing the casino’s construction. Also part of the financing would include federal recognition for the Salinan Indian tribe to operate the casino.

Pejihota documents project earnings of approximately $600 million over the next 50 years, according to the group’s records.


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Member Opinions:

By: cheseburger on 9/19/09

Out of all our California Agencys, we get our only hope of recovery, from an Ohio Bankruptcy Court. I say let’s make those crooks build that Casino with ankle shackles on barefooted!

Think about it government supervised construction, with the profits going to investors who subsequently by now are feeling wet, naked and draped over an old chair. Miller can be the crooked dealer, from the bottom of the deck and Brard would make a fine cigar box girl, and dear old Gearhart, get’s to be the janitor, because that’s all he’s really qualified to do. Jones is washed up as a lawyer so he’s not trustworthy enough to park cars, I guess he’ll just have to wash dishes, anyway they shouldn’t get a pass but I sure like the idea of getting paid something back, is it just a tease or the real thing?

By: JorgeEstrada on 9/18/09

Hey Dash-Rip-rock, do you really know some dirty little secrets about Gearheart that would, in most cases, put him in jail? Is it about some financial ties to law enforcement, the Courts or what? The victims are very curious about facts you may have. For them this is not a vicarious thrill.

By: Al on 9/17/09

“No no no, not ohayo! Ohio! Ohio is in US lah!”

By: BeenThereDoneThat on 9/17/09

Alright please enlighten us with what you might know. I thought knowing Kelly I have heard most of but would like to hear more.

By: DashRiprock on 9/17/09

still makes no sense to me why gearhart is not in jail…i guess most of you don’t know what i know….

By: Black_Copter_Pilot on 9/17/09

jeeze, the addicts are the last to know.


By: Cindy on 9/17/09

You have to be kidding me! These guys aren’t going to do those steps. You have to want to change to do those steps.

Now if someone can come up with 12 steps on how to get away with anti – social antics, I’m sure they’ll all sign on.

By: BeenThereDoneThat on 9/17/09

No problem on the steps. Just was lost on the connection to this article. Thanks.

By: hotdog on 9/17/09

Right on, but of course the subjects of these articles are totally gone psychopaths and the only remedy for them is the clink, or worse.

By: Nancimeek on 9/17/09

Has anyone crossed checked with decisions handed down from the Water Board on which Grigger sits to see if there were any conflicts

By: Cindy on 9/17/09

I’m confused too. I’ve never heard that any of these guy’s are alcoholic’s or drug addicts. I thought they were criminals, sociopaths, anti-social personalities and outright thieves.

By: BeenThereDoneThat on 9/17/09

I’m a little lost. So are you saying Kelly, Grigger and company are addicts? And what kind? Money? Just wondering.

By: hotdog on 9/17/09

I’ve known a bunch of addicts (mostly alchies) over the years, some of whom attempted to conquer the 12 steps. I have never seen any of them do #8, not even try it. Seems to be endemic in our sick society, no matter how much or often one screws up a sincere and honest apology never comes. That would actually take a mature attitude of contrition and a strong sense of justice-all lacking amongst friend and foe alike.

By: Black_Copter_Pilot on 9/17/09

For those that can benefit…ou know who you are

•Step 1 – We admitted we were powerless over our addiction – that our lives had become unmanageable

•Step 2 – Came to believe that a Power greater than ourselves could restore us to sanity

•Step 3 – Made a decision to turn our will and our lives over to the care of God as we understood God

•Step 4 – Made a searching and fearless moral inventory of ourselves

•Step 5 – Admitted to God, to ourselves and to another human being the exact nature of our wrongs

•Step 6 – Were entirely ready to have God remove all these defects of character

•Step 7 – Humbly asked God to remove our shortcomings

•Step 8 – Made a list of all persons we had harmed, and became willing to make amends to them all

•Step 9 – Made direct amends to such people wherever possible, except when to do so would injure them or others

•Step 10 – Continued to take personal inventory and when we were wrong promptly admitted it

•Step 11 – Sought through prayer and meditation to improve our conscious contact with God as we understood God, praying only for knowledge of God’s will for us and the power to carry that out

•Step 12 – Having had a spiritual awakening as the result of these steps, we tried to carry this message to other addicts, and to practice these principles in all our affairs

By: Cindy on 9/17/09

X2@U Booty – Good Post

By: Black_Copter_Pilot on 9/16/09

well stated, Mr. Juice

By: Booty_Juice on 9/16/09

Face it, shame and decency are gone. Forever.

I have spent the last ten years watching as lawlessness increases at meteoric proportions while the responsibilities of the average citizen have been diluted to the point where nobody is prepared to jump into a lake to save a drowning child for fear of being held responsible.

Criminality was once a suit to be worn only by the most feckless, worthless scum. You would be denied housing, employment, destined to a life of squalor and poverty, reviled by society and held in contempt by your peers. An appearance in court was tantamount to professional suicide.

Alas, we now have on the spot fines for shoplifting, and $400 fines for serious physical assault on innocent bystanders. We have children and teenagers who are quite literally “untouchable” and by default, unteachable. The parental responsibilities of these scrotes are zero.

All of this has been created by the self perpetuating, all powerful STATE. The state decided that IT alone would raise the next generation of citizens as it is the only one qualified to do so. It has failed miserably, utterly and completely. It allowed these generations to pick and chose the education and morals it wanted by bribing them with promises of full employment, state benefits and handouts for the feckless, warm cozy blankets for the lazy and workshy, no stigma for failure, and no consequences for sloth. And guess what. The voting public bought it.

You cannot fail in the modern US. You will only suffer “deferred success”. This utopian vision was brought to you by those who craved power at any cost and still do. Too stupid to take exams? We’ll dumb them down until you CAN pass them. We told you we would look after you. Now sign your name here. By the way, you are so stupid (thanks to our education system) that chances are you’ll NEVER own a house. Here’s housing benefits for you.

But the state cannot control the free market. It never will. It produces swarms of idle, fat, ignorant zombies whose sole function is just to vote. Not to work. Not to create wealth or pioneer a new way. Just vote. Here’s your benefits. Now be quiet.

Result? Two generations of thieves. Idiots so ill prepared for real life that they will never work, so they resort to theft, burglary, mugging, fraud, shooting, drug dealing and pimping. That, and their white collar cousins who create even more damage under the color of “legitimate” business.

By: Fedup on 9/16/09

One thing that could possibly drive another nail or two in Jones’ coffin is to check out his voting record with the Atascadero Water Co. If he voted in favor of any of his clients on water issues it could, at the very least, trigger a Grand Jury investigation. At any rate he wouldn’t be able to invoke attorney client privilege as he has done so many times in the past.

A few years ago I checked Leroy Davis’ voting record and I found the water co. personnel most cooperative and helpful.

This could be the same kind of conspiracy alluded to in the article.

By: pixieboohoo on 9/16/09

That’s always the defense when liars are exposed publically: “That person is just a bored, unstable lunatic!” Truth will come out… Keep it up Nancy-he’s one of the slimiest-I look forward to a few other associates from his circle finally going down too.

By: Nancimeek on 9/16/09

Jones didn’t have any trouble saying no when our stepmother asked him to help her with her agenda regarding our father’s trust.

And me didn’t say NO to any of the money she paid him as a retainer………..$45,000 plus other monies she paid to him during the next few years (we have the records Mr. Jones)



Still think these are internet rants by an “unstable individual”? How is your friend Accountant Michael Gould doing?

By: Nancimeek on 9/16/09

Everyone I have spoken to associated with Gearhart including an ex secretary and ex wife stated that Gearhart and Grigger jones are “thick as Thieves” and were always together “doing this and that” Any one else want to comment on the relationship between Gearhart and these guys? Yeah you are right it is easy to say “Deny Deny Deny” or just “don’t answer” when you are questioned about something……… Grigger spends alot of time denying and “NOT TALKING” about alot of situations when he is being questioned under oath and just plain being questioned. Sin of omission is worse than a lie

By: Michelle on 9/15/09

Salinan9- Asks if Grigger Jones response to the complaint is perjury. Seems like it should be doesn’t it? The fact is that the way the law works it’s set up to allow the responding party to deny, deny, deny. We can all thank the lawyers and the “overall” legal establishment for that (lawyers). To answer your question Salinan9, No it isn’t perjury until they lie under oath on the stand (if it ever gets to that). Big joke isn’t it? This is how our legal establishment works Salinan9 and our DA who is the biggest “pussy” that ever landed on the Central Coast shakes in his boots every time he has to take up our cause without a certainty of prevailing. I wish I could live that cowards life without having to look in the mirror and knowing what a worthless …..

No would never want to be there, not ever.

By: hotdog on 9/15/09

Booty, I don’t know if my plants would like that toxic mix on them! Sort of like diseased material, might be best to burn the results.

By: Booty_Juice on 9/15/09

Dip them all in acid and then make fertilizer of them.

By: Nancy on 9/15/09

Hey there Grigger Jones and Molina, So yah thought this would all be done away with in 30 days, did yah.


See my big Gomar Pile grin :)

By: Laura on 9/15/09

How can Jones possibly say the Pi-Ji-Ho-Ta LLC has no value. Gearhart funded it will over a million dollars and they have a contract with the Salinan Indians to garner 40% of the proceeds from their future casino! That’s a whole lot of value. They could sell that contract for millions without ever lifting another finger.

I have to laugh at them not understanding what an insider relationship with Gearhart means.

By: Cindy on 9/15/09

Oh no BigSmiles – I hope the money hasn’t all been disbursed. I wonder if this is the canceled check that cheseburger was talking about wanting to get his hands on? If they find any payouts to politicians for the purpose of “fast tracking” the Indian recognition and casino ownership rights, this will really blow up fast.

By: JorgeEstrada on 9/15/09

This is a great comentary from the legal system, with all their credentials, while reflecting a great loss due to fraud; “have the new suckers pay back the old suckers”?

Now that is powerful thinking….

By: BIG_SMILES on 9/15/09

They don’t mention how much of the original 1 to 1.5 million that Gearhart ran into this LLC is still liquid. They didn’t write a big check to McCarthy, did they?

By: Cindy on 9/15/09

This is great news. Some of Kelly’s investment funds have already financed this endeavor so it makes sense that the bk court will want to make a claim against Kelly’s future share of any profits , which would be based on how the LLC agreement read at the time he became insolvent. This bk attorney is a smart fellow, BRAVO! Not only have they found where there is 1,000,000+ (in misappropriated funds) stashed away but they found a way to collect on any future revenues this entity might generate. If this Salian Tribe ever does gain gov recognition it won’t be all that difficult for the interested parties to raise the necessary financing for this Casino (contingent on what kind of a lien the court throws on the LLC) Casino’s make big money, not sure if anyone will trust Grigger Jones as a fiduciary though. I sure hope the bilked investors recover a reasonable portion of their investments back. At least we know Gearhart and Jones won’t end up sitting pretty unless the investors do.

NanciMeek, Has the Atascadero PD investigator that is working on your case against Grigger dropped it on the DAs desk yet?

By: Bluebird on 9/14/09

How sweet it is watching Grigger Jones try to weasel out of this. I bet the Rottman Group is glad they opted out of the is great deal. Good update Karen. Keep us posted.

By: Booty_Juice on 9/14/09

May they die of starvation in a frozen ditch inside an asbestos tent, shivering in small pox blankets.

By: BeenThereDoneThat on 9/14/09

It would not make my day or make my year, it would make my Milinium to see Grigger, Chris, Kelly et al, all behind bars!!!

By: BeenThereDoneThat on 9/14/09

I LOVE this from the article.

the defendants say they do not have sufficient information to answer the allegation of an insider relationship “and therefore deny the same.”

I can’t believe this. Grigger it is easy. Did you know Kelly other than talking to him once or twice? Hmm you did business with him. Guess you knew him.

Chris. Same question. Hmm you have known him for YEARS!! Hurry and lawyer up boys the Feds are coming. Bunch of a**holes