$46 million civil case brought by Doug Morriss’ mother goes to trial (MO)

A case brought in 2012 by Doug Morriss’ mother, Barbara Burton Morriss, is going to trial in St. Louis County Circuit Court.

A jury was being selected Monday morning for the case, in which Barbara Morriss alleged that Wells Fargo Bank or its predecessors breached its fiduciary duty when it allowed assets from two Morriss family trusts to be pledged as collateral for loans to Morriss Investments, which later defaulted. The bank later seized the assets of the two family trusts, which had a combined value of about $46 million when they were entrusted to the bank, according to Barbara Morriss’ lawsuit.

UHY Advisors Mo Inc. and accountant Patrick Stark are also listed as defendants.

Barbara Morriss is listed as both a beneficiary and co-trustee on both trusts: the Mary Schofield Burton Trust, set up by her late mother, which had a value of $14 million at the time it was turned over to a Wells Fargo Bank predecessor, and the Barbara Burton Morriss Revocable Trust, which had a value of about $32 million when it was turned over to a Wells Fargo Bank predecessor. Doug Morriss was later added as a co-trustee on both trusts, and Wells Fargo breached its fiduciary duty to both trusts and trust beneficiaries when it approved pledging of trust assets for lines of credit and loans to Doug Morriss from March 2000 to November 2011, all while collecting substantial fees and interest, according to the lawsuit.

“Ultimately B. Douglas Morriss was unable to repay the lines of credit/loans and defendant Wells Fargo appropriated all assets of Burton Trust in its possession in partial satisfaction of the loans made to B. Douglas Morriss,” the lawsuit said. The “Morriss Trust assets, originally valued at approximately $32 million,” were also taken by Wells Fargo.

Barbara Morriss seeks to recover the value of the trusts, attorney and other fees, and punitive damages.

Doug Dowd of Dowd & Dowd P.C. is representing Barbara Morriss. Catherine Schroeder of Thompson Coburn LLP is representing Wells Fargo. Gerard Noce of HeplerBroom Law Firm is representing UHY Advisors Mo Inc. and Stark. Opening arguments are expected to begin Monday afternoon or Tuesday morning.

Doug Morriss filed bankruptcy months before Barbara Morriss’ suit was filed. That followed a U.S. Securities and Exchange Commission complaint alleging that Morriss and his businesses, including Acartha Technology Partners and Gryphon Investments III, raised millions of dollars from investors and then used the funds to pay personal expenses.

In December 2013, Doug Morriss was sentenced to five years in prison on tax evasion charges. His business partner, John Wehrle, was in January indicted on charges of tax evasion and filing a false tax return.

Attribution:

$46 million civil case brought by Doug Morriss’ mother goes to trial
Jacob Kirn
Apr 27, 2015
St. Louis Business Journal
http://www.bizjournals.com/stlouis/news/2015/04/27/46-million-civil-case-brought-by-doug-morriss.html

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