Georgia condo owners attempt to stop termination effort under RICO Act

By Deborah Goonan, Independent American Communties


Here we go again – yet another attempt at condo termination against the will of minority shareholders. This case involves owners of 10 units in the 46-unit Heritage Square Condominium Associations, located in Athens, Georgia.

Businessman Fred Moorman currently owns 35 of 46 units. Moorman controls the condo association board and serves as landlord and manager of Heritage Square.

Ten condo owners have decided to sue Moorman for his attempt to takeover the association. They allege shady condo purchase deals meant to artificially depress property values of remaining units of the hold-out owners that do not wish to sell their condos.

Attorney for the Plaintiffs (homeowners), John Holis Baker, has alleged criminal conduct under Georgia’s RICO Act.

But the Athens Banner-Herald reports that Judge Lawton Stephens sees no evidence of a criminal act by Moorman or the condo association. That’s a strong clue that Stephens will ultimately dismiss RICO allegations.

After all, a hostile takeover of a condominium corporation, however unsavory, is perfectly legal.

Stephens also hints that condo owners only have a valid legal claim for financial damages if they actually sell their homes to Moorman,  and can provide evidence of an artificially low purchase price.

In other words: most disputes involving association-governed housing are “civil matters.”


No harm to condo owners in Moorman takeover, his lawyers say

Athens Banner-Herald

Posted October 19, 2017 01:25 pm
By Lee Shearer

Condominium owners suing Athens landlord and property owner Fred Moorman can’t prove they’ve been damaged by Moorman’s takeover-in-progress of their Sunset Drive condominium complex, according to arguments made on Thursday during a hearing in Athens-Clarke County Superior Court.

The 10 condo owners filed suit in June accusing Moorman of violating Georgia’s civil Racketeer Influenced and Corrupt Organizations Act. Moorman’s attorneys sought to have the suit dismissed on Thursday.

Read more:

See also, previous article in Athens Online.


Reference – defining the RICO Act:

Passed in 1970, the Racketeer Influenced and Corrupt Organizations Act (RICO) is a federal law designed to combat organized crime in the United States. It allows prosecution and civil penalties for racketeering activity performed as part of an ongoing criminal enterprise. Such activity may include illegal gambling, bribery, kidnapping, murder, money laundering, counterfeiting, embezzlement, drug trafficking, slavery, and a host of other unsavory business practices.

To convict a defendant under RICO, the government must prove that the defendant engaged in two or more instances of racketeering activity and that the defendant directly invested in, maintained an interest in, or participated in a criminal enterprise affecting interstate or foreign commerce. The law has been used to prosecute members o

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