Counsel Concerns

Atlanta Attorney'Sued over Funding'of Phony Lil'Wayne Concerts

An Atlanta attorney is facing allegations that he missed red flags that should have prevented him from disbursing $275,000 from his escrow account to phony representatives of the rap star Lil Wayne and an apparently nonexistent lawyer. A single-count complaint for breach of fiduciary duty filed in August 2013 in Fulton County Superior Court said the payments by Venkatesh “Vinny” Kumar of the entertainment boutique Keniley Kumar Law Firm left an Ohio woman waiting nearly three years for the remainder of the $400,000 she intended to invest in two Lil Wayne concerts in late 2011. Blackwell v. Kumar, 2013 CV 234805.

Plaintiff's lawyer, Charlotte Perrell, said she and her client, Kimberly Blackwell, don't think Kumar was acting in bad faith when he allegedly mishandled the funds. They believe he and his clients ' the rap collective he represents and once served as general manager, The Black Mob Group, and its president, Ernest Foxx ' were themselves victims of fraudsters claiming to represent Lil Wayne, the New Orleans-born rapper whose real name is Dwayne Michael Carter Jr.

“But ultimately,” Perrell says, “the funds were disbursed from [Kumar's] trust account, and it was obvious that they were not authorized, in clear violation of the escrow agreement.”

Kumar says he had not seen the complaint at the time this article was written and referred inquiries to his attorney, Hall Booth Smith partner Karl Braun, who did not respond to requests for comment.

False Promotion

If Kumar, Foxx and ultimately Blackwell were the victims of a fraud, they are not alone. According to contemporaneous news accounts, trouble started days after Lil Wayne emerged from an eight-month stint at New York's Rikers Island in November 2010 on a weapons charge. The stories said promoters began getting calls from people pretending to be Lil Wayne's manager, Cortez Bryant, and another Bryant Management Group officer soliciting advance booking fees for a tour by the rapper and other artists.

The real Bryant released a widely circulated statement warning about the scam.

According to Blackwell's Fulton County complaint, in August 2011: “Foxx and other representatives of Black Mob Group” approached Blackwell about an opportunity to invest in two shows slated for October of that year to be staged at the Cajundome in Lafayette, LA, and at the DeSoto Civic Center near Memphis, TN. Blackwell, the founder and CEO of a Columbus, OH, advertising and public relations firm, was to provide $400,000 in return for an unspecified return on her investment. When she was approached about the deal, Blackwell was told Kumar had been retained by Foxx and Black Mob Group to act as escrow agent for the transaction, the complaint said.

According to Kumar's LinkedIn account, he served as Black Mob Group's general manager from 2003 until 2008. He is listed as its registered agent, according to the Georgia Secretary of State's website.

“[F]rom the outset, Ms. Blackwell understood that an attorney would be facilitating the transfer of funds between the parties pursuant to a written agreement, a circumstance which bolstered her level of confidence in the soundness and security of the Concert Investment, as it would be overseen by counsel,” the complaint states. According to the complaint, Blackwell wired Kumar two $200,000 installments on Sept. 13 and 14, 2011. According to the binder agreement, the money was to remain in his escrow account until Black Mob Group or Bryant Management confirmed the dates of the shows; if they had not been confirmed within 10 days, the money was to be refunded.

Under the binder's terms, once written confirmation was received Kumar was to disburse $157,000 to entertainment conglomerate Live Nation, Bryant Management and Black Mob Group. Another $42,500 was to be disbursed to Nicole Martin, an officer with a company representing Blackwell's interests. The shows were supposed to take place in mid-to late October, but weeks passed and “uncertainty regarding the proposed concert dates lingered,” the complaint states. The proposed dates “came and went without any progress or status updates from Defendant Kumar or Mr. Foxx.”

Near the end of October, the complaint claims, Blackwell sent Kumar a letter demanding a refund. In November, Kumar allegedly responded, “not by returning Ms. Blackwell's deposit pursuant to her demand, but rather by notifying her for the first time that he had transferred a total of $275,000″ from his escrow account, including $235,000 to “Empire International Financial Group.”

On Nov. 30, 2011, according to court documents, Kumar sent Blackwell a letter saying Black Mob Group had authorized him to return all available funds to Blackwell through Martin, and that Foxx had “also contacted his representatives at Bryant Management to request a refund of the deposits paid pursuant to [the Lil Wayne] performances. I will direct my client to keep the communication lines open with Ms. Martin and to keep everyone apprised of the matter as it progresses,” Kumar wrote.

Subsequently, the complaint states: “Kumar confessed that payment of Ms. Blackwell's funds had been made to various unauthorized parties,” including Empire, “Tyga Music LLC” and “R. Gillis, Esq.” None of these entities has been contemplated in the agreement, Blackwell's suit charges, “and no one on the 'Purchaser' side of the binder Agreement knew of these entities or ever authorized payment to these entities.” (At least one of the alleged recipients, “Tyga Music LLC,” does exist; it is related to Los Angeles rapper “Tyga,” whose label, Young Money Entertainment, was founded by Lil Wayne and was once headed by Bryant.)

In January 2012, Kumar sent Blackwell a letter saying that his client, Foxx, “was the victim of a potential fraud by Bryant Management,” and that correspondence and conversation with individuals claiming to be Cortez Bryant and others affiliated with Lil Wayne's label had “created a very complex and confusing situation.” According to the court complaint, Blackwell was refunded $125,000 of her investment; the remaining $275,000 is missing.

Warning Signs

Perrell, Blackwell's lawyer, claims even a cursory investigation of the correspondence should have alerted Kumar that something shady was afoot.

There were other warning signs, according to the complaint. Kumar, it states, “claimed that he understood Empire to be a holding company for Live Nation” but, had he “undertaken to investigate the legitimacy of 'Empire,' he would have found the following 'red flags' rendering this entity suspect: (i) neither Empire nor a holding company of any kind was listed on LiveNation's [sic] website at the time of the unauthorized transfers; (ii) the address Empire's alleged representative provided to Defendant Kumar was actually the address of Regus Temporary and Virtual Offices, and a quick phone call would have revealed that no business operating under the name of 'Empire' had ever occupied space there; and (iii) 'Empire' provided an invalid phone number” to Kumar.

The address “Tyga Music” provided was actually a personal home in a residential neighborhood in New Jersey, “and clearly not a studio or business,” says Perrell. As to attorney “R. Gillis, Esq.,” the complaint claims that no such person could be found in the State Bar of Maryland's directory, where his purported address was located, nor could any such attorney be found on the Internet.

Perrell says Blackwell was aware that Kumar had been involved in the music business and that his background, coupled with his status as an attorney, assuaged any concerns she had about getting involved with the project. “Some of the comfort level was that there was going to be an attorney involved, your funds were in his escrow account, you had a binder, [and] you're dealing with somebody with experience in the music business.”

Greg Land is a Staff Reporter for the Atlanta-based Daily Report, an ALM affiliate of Entertainment Law & Finance.

Atlanta Attorney'Sued over Funding'of Phony Lil'Wayne Concerts

An Atlanta attorney is facing allegations that he missed red flags that should have prevented him from disbursing $275,000 from his escrow account to phony representatives of the rap star Lil Wayne and an apparently nonexistent lawyer. A single-count complaint for breach of fiduciary duty filed in August 2013 in Fulton County Superior Court said the payments by Venkatesh “Vinny” Kumar of the entertainment boutique Keniley Kumar Law Firm left an Ohio woman waiting nearly three years for the remainder of the $400,000 she intended to invest in two Lil Wayne concerts in late 2011. Blackwell v. Kumar, 2013 CV 234805.

Plaintiff's lawyer, Charlotte Perrell, said she and her client, Kimberly Blackwell, don't think Kumar was acting in bad faith when he allegedly mishandled the funds. They believe he and his clients ' the rap collective he represents and once served as general manager, The Black Mob Group, and its president, Ernest Foxx ' were themselves victims of fraudsters claiming to represent Lil Wayne, the New Orleans-born rapper whose real name is Dwayne Michael Carter Jr.

“But ultimately,” Perrell says, “the funds were disbursed from [Kumar's] trust account, and it was obvious that they were not authorized, in clear violation of the escrow agreement.”

Kumar says he had not seen the complaint at the time this article was written and referred inquiries to his attorney, Hall Booth Smith partner Karl Braun, who did not respond to requests for comment.

False Promotion

If Kumar, Foxx and ultimately Blackwell were the victims of a fraud, they are not alone. According to contemporaneous news accounts, trouble started days after Lil Wayne emerged from an eight-month stint at New York's Rikers Island in November 2010 on a weapons charge. The stories said promoters began getting calls from people pretending to be Lil Wayne's manager, Cortez Bryant, and another Bryant Management Group officer soliciting advance booking fees for a tour by the rapper and other artists.

The real Bryant released a widely circulated statement warning about the scam.

According to Blackwell's Fulton County complaint, in August 2011: “Foxx and other representatives of Black Mob Group” approached Blackwell about an opportunity to invest in two shows slated for October of that year to be staged at the Cajundome in Lafayette, LA, and at the DeSoto Civic Center near Memphis, TN. Blackwell, the founder and CEO of a Columbus, OH, advertising and public relations firm, was to provide $400,000 in return for an unspecified return on her investment. When she was approached about the deal, Blackwell was told Kumar had been retained by Foxx and Black Mob Group to act as escrow agent for the transaction, the complaint said.

According to Kumar's LinkedIn account, he served as Black Mob Group's general manager from 2003 until 2008. He is listed as its registered agent, according to the Georgia Secretary of State's website.

“[F]rom the outset, Ms. Blackwell understood that an attorney would be facilitating the transfer of funds between the parties pursuant to a written agreement, a circumstance which bolstered her level of confidence in the soundness and security of the Concert Investment, as it would be overseen by counsel,” the complaint states. According to the complaint, Blackwell wired Kumar two $200,000 installments on Sept. 13 and 14, 2011. According to the binder agreement, the money was to remain in his escrow account until Black Mob Group or Bryant Management confirmed the dates of the shows; if they had not been confirmed within 10 days, the money was to be refunded.

Under the binder's terms, once written confirmation was received Kumar was to disburse $157,000 to entertainment conglomerate Live Nation, Bryant Management and Black Mob Group. Another $42,500 was to be disbursed to Nicole Martin, an officer with a company representing Blackwell's interests. The shows were supposed to take place in mid-to late October, but weeks passed and “uncertainty regarding the proposed concert dates lingered,” the complaint states. The proposed dates “came and went without any progress or status updates from Defendant Kumar or Mr. Foxx.”

Near the end of October, the complaint claims, Blackwell sent Kumar a letter demanding a refund. In November, Kumar allegedly responded, “not by returning Ms. Blackwell's deposit pursuant to her demand, but rather by notifying her for the first time that he had transferred a total of $275,000″ from his escrow account, including $235,000 to “Empire International Financial Group.”

On Nov. 30, 2011, according to court documents, Kumar sent Blackwell a letter saying Black Mob Group had authorized him to return all available funds to Blackwell through Martin, and that Foxx had “also contacted his representatives at Bryant Management to request a refund of the deposits paid pursuant to [the Lil Wayne] performances. I will direct my client to keep the communication lines open with Ms. Martin and to keep everyone apprised of the matter as it progresses,” Kumar wrote.

Subsequently, the complaint states: “Kumar confessed that payment of Ms. Blackwell's funds had been made to various unauthorized parties,” including Empire, “Tyga Music LLC” and “R. Gillis, Esq.” None of these entities has been contemplated in the agreement, Blackwell's suit charges, “and no one on the 'Purchaser' side of the binder Agreement knew of these entities or ever authorized payment to these entities.” (At least one of the alleged recipients, “Tyga Music LLC,” does exist; it is related to Los Angeles rapper “Tyga,” whose label, Young Money Entertainment, was founded by Lil Wayne and was once headed by Bryant.)

In January 2012, Kumar sent Blackwell a letter saying that his client, Foxx, “was the victim of a potential fraud by Bryant Management,” and that correspondence and conversation with individuals claiming to be Cortez Bryant and others affiliated with Lil Wayne's label had “created a very complex and confusing situation.” According to the court complaint, Blackwell was refunded $125,000 of her investment; the remaining $275,000 is missing.

Warning Signs

Perrell, Blackwell's lawyer, claims even a cursory investigation of the correspondence should have alerted Kumar that something shady was afoot.

There were other warning signs, according to the complaint. Kumar, it states, “claimed that he understood Empire to be a holding company for Live Nation” but, had he “undertaken to investigate the legitimacy of 'Empire,' he would have found the following 'red flags' rendering this entity suspect: (i) neither Empire nor a holding company of any kind was listed on LiveNation's [sic] website at the time of the unauthorized transfers; (ii) the address Empire's alleged representative provided to Defendant Kumar was actually the address of Regus Temporary and Virtual Offices, and a quick phone call would have revealed that no business operating under the name of 'Empire' had ever occupied space there; and (iii) 'Empire' provided an invalid phone number” to Kumar.

The address “Tyga Music” provided was actually a personal home in a residential neighborhood in New Jersey, “and clearly not a studio or business,” says Perrell. As to attorney “R. Gillis, Esq.,” the complaint claims that no such person could be found in the State Bar of Maryland's directory, where his purported address was located, nor could any such attorney be found on the Internet.

Perrell says Blackwell was aware that Kumar had been involved in the music business and that his background, coupled with his status as an attorney, assuaged any concerns she had about getting involved with the project. “Some of the comfort level was that there was going to be an attorney involved, your funds were in his escrow account, you had a binder, [and] you're dealing with somebody with experience in the music business.”

Greg Land is a Staff Reporter for the Atlanta-based Daily Report, an ALM affiliate of Entertainment Law & Finance.