ye i © \e " | cavse nol Rasy 10 HELMUT LANDWEHR, GARY IN THE DISTRI SOLOMON, JOHN SAUNDERS, BASIL HAYMANN, DOT HAYMANN, WARREN HARMEL, KURT MAERSCHEL, AND. STEVE SANDERS, Plaintiffs, . DALLAS COUNTY, TEXAS TODAY REALTY ADVISORS INC., ‘TODAY FINANCIAL CORPORATION, TODAY FINANCIAL LLC, TODAY REALTY INVESTMENTS INC., BUCKINGHAM FINANCIAL LLC, CDB HOLDINGS LP, WERNER ERIC BRAUSS, CHRISTINE BRAUSS, AND QUORUM EQUITIES GROUP LLC, 1i6a.p _—___ JUDICIAL DISTRICT 0 05 ct a 2 mL Lt UP LD 2 Le Defendants, PLAINTIFFS’ ORIGINAL PETITION AND APPLICATION FOR TEMPORARY RESTRAINING ORDER AND TEMPORARY INJUNCTIVE RELIEF, AND MOTION FOR APPOINTMENT OF AUDITOR TO THE HONORABLE JUDGE OF SAID COURT: Plaintiffs Helmut Landwehr, Gary Solomon, John Saunders, Basil Haymann, Dot Hayman, Warren Harmel, Kurt Maerschel, and Steve Sanders (collectively, “Plaintifis”), individually and on behalf of each of the 39 TRA, Inc. active Operating Limited Partnerships (the “TRA Operating Partnerships") and 39 TRA Investment Limited Partnerships (the “TRA Investment Partnerships”) file Plaintiffs’ Original Petition and Application for Temporary Restraining Order and ‘Temporary Injumetive Relief, and Motion for Appointment of Auditor PLAINTIFFS’ ORIGINAL PETITION AND APPLICATION FOR TEMPORARY RESTRAINING ORDER AND TEMPORARY INJUNCTIVE RELIEF, AND MOTION FOR APPOINTMENT OF AUDITOR.- Page 1(Petition) complaining of Defendants Today Realty and Advisors, Inc.; Today Financial Corporation; Today Financial, LLC: Today Realty Investments, Inc.; Buckingham Financial, LLC; CDB Holdings, LP; Wemer “Eric” Brauss; Christine Brauss and Quorum Equities Group, LLC (collectively “Defendants”), and moving the Court for a Temporary Restraining Order (“TRO”) and Temporary Injunctive Relief, and file a Motion for Appointment of Auditor as follows: L DISCOVERY LEVEL 1. Discovery in this case should be conducted under Level 3 as provided in Rule 190.3 of the Texas Rules of Civil Procedure. uL. PARTIES 2. Plaintiff Helmut Landwehr is a German citizen currently domiciled in Dallas County, Texas. 3, Plaintiff Gary Solomon is an individual residing in Dallas County, Texas. 4, Plaintiff John Saunders is an individual residing in Dallas County, Texas. 5. Plaintiff Basil Haymann is an individual residing in Dallas County, Texas, 6 Plaintiff Dot Haymann is an individual residing in Dallas County, Texas. 7, Plaintiff Warren Harmel is an individual residing in Dallas County, Texas. 8. Plaintiff Kurt Maerschel is an individual residing in Dallas County, Texas, 9. Plaintiff Steve Sanders is an individual residing in Dallas County, Texas. PLAINTIFFS' ORIGINAL PETITION AND APPLICATION FOR TEMPORARY RESTRAINING ORDER AND TEMPORARY INJUNCTIVE RELIEF, AND MOTION FOR APPOINTMENT OF AUDITOR - Page 210, Defendant Today Realty Advisors, Inc. is a Texas entity, with its principal place of business in Dallas, Dallas County, Texas and may be served with process by service upon its registered agent, Edward M. Fishman, al its registered office for service of process, located at 2200 One Galleria Tower, 13355 Noel Rd., LB 48, Dallas, Texas 75240, (972) 419-8300. 11. Defendant Today Financial Corporation is a Texas entity, with its principal place of business in Dallas, Dallas County, Texas and may be served with process by service upon its registered agent, Edward M. Fishman, at its registered office for service of process, located at 2200 One Galleria Tower, 13355 Noel Rd. LB 48, Dallas, Texas 75240, (972) 419-8300. 12, Defendant Today Financial, LLC is a Texas entity, with its principal place of business in Dallas, Dallas County, Texas and may be served with process by service upon its registered agent, Wemer Eric Brauss, at its registered office for service of process, located at 5545 Celestial Road, Dallas, Texas 75254-7611, (972) 980-8036. 13, Defendant Today Realty Investments, Inc. is a Texas entity, with its principal place of business in Dallas, Dallas County, Texas and may be served with process by service upon its registered agent, Sue Shelton, at its registered office for service of process, located at 4633 Princess Caroline Court, Friseo, Texas 75034,(972) 489-1512, 14, Defendant Buckingham Financial, LLC is a Texas entity, with its principal place of business in Dallas, Dallas County, Texas and may be served with process by service upon its registered agent, Sue Shelton, at its registered office for service of process, located at 4633 Princess Caroline Court, Frisco, Texas 75034, (972) 489-1512. PLAINTIFFS’ ORIGINAL PETITION AND APPLICATION FOR TEMPORARY RESTRAINING ORDER AND TEMPORARY INJUNCTIVE RELIEF, AND MOTION FOR APPOINTMENT OF AUDITOR - Page 315, Defendant CDB Holdings, LP is a’Texas entity, with its prinefpal place of business in Dallas, Dallas County, Texas and may be served with process by service upon its registered agent, Robert E. Feiges, at its registered office for service of process, located at 5301 Spring Valley Rd., Suite 200, Dallas, TX 75254, (972) 788-1400. 16. Defendant Wemer Eric Brauss is an individual residing in Dallas Coumy, Texas and may be served with process at his address 5545 Celestial Road, Dallas, Texas 75254-7611, (972) 980-8036. 17, Defendant Christine Brauss is an individual residing in Dallas County, Texas and may be serviced with process at her address $720 Cavender Drive, Plano, Texas 75093-5965. 18, Defendant Quorum Equities Group, LLC is a Texas entity, with its principal place of business in Dallas County, Texas and may be served with process by service upon its registered agent, Axley & Hargrove, PC, at its registered office for service of process, located at 3400 Catlisle Street, Suite 400, Dallas, Texas 75204-1268, (214) 954-0067. I. JURISDICTION AND VENUE 19, The Court has jurisdiction over this controversy because the damages, exclusive of interest and costs, exceed the jurisdictional minimum of the court. Venue is proper in Dallas County, Texas because one or more of the Defendants maintained an office and conducted business in Dallas County, and all or substantially all of the events or omissions giving rise to Plaintiffs’ causes of action occurred in Dallas County. TEX. Cv. PRA. & REM. CODE ANN. § 15.002(a)(1). PLAINTIFFS’ ORIGINAL PETITION AND APPLICATION FOR TEMPORARY RESTRAINING ORDER AND TEMPORARY INJUNCTIVE RELIEF, AND MOTION FOR APPOINTMENT OF AUDITOR - Page 4Wv. SUMMARY OF ACTION 20. This case involves the fraudulent diversion of at least $6.038 million from real estate partnerships in which the Plaintiffs have contributed that have been transferred, both directly and indisectly, to the Defendants. Defendants Erie Brauss and Christine Brauss individually, and on behalf of the other Defendants, have admitted to diverting these funds, and either have fled, or there is an immediate risk of their fleeing the country. Over the past few days, the Defendants’ offices have been closed, all of the employees have been fired, and the books and records have been transferred to an unknown location. There exists in immediate and irreparable threat that unless 2 temporary restraining order is issued, the assets of these Defendants as well as the 39 real estave partnerships (consisting of in excess of $120 million of value) will be wasted and lost, the records necessary to trace investor funds will be destroyed or removed out of the jurisdiction, and the fact witnesses necessary to prove a cause of action will be beyond the jurisdictional limits of this court. Further, as recently as Sunday, November 22, 2009, Eric Brauss told Helmut Landwehr in a telephone conversation that he must immediately leave the country or he will be put in jail, 21. By this lawsuit, the Plaintiffs seek the issuance of an immediate temporary restraining order and temporary injunction to enjoin the defendants from “@ secreting, concealing, or destroying, any of the computer and/or physical records of the defendants, or any of the TRA Investment Partnerships and TRA Operating Partnerships at issue in this case; PLAINTIFFS’ ORIGINAL PETITION AND APPLICATION FOR TEMPORARY RESTRAINING ORDER AND TEMPORARY INJUNCTIVE RELIEF, AND MOTION FOR APPOINTMENT OF AUDITOR - Page 5(i) transferring, moving, depleting, pledging, spending, using, or secreting assets in the defendants’ bank accounts at either J.P. Morgan Chase, or Northern Trust Bank, and all other accounts into which funds from these investors have flown, and all other accounts over which the defendants have signatory authority; (ii) undertaking any actions to transfer, sell, exchange, dispose of, and/or Tiquidate, any of the assets of the defendants without further order of this court; 22. Further, the Plaintiffs seek the appointment of an auditor to conduct a thorough review of the books and records of the defendants, 0 determine the total amount of investor funds that have been transferred between or among the defendants, and to provide a report to this court of its findings. 23. Plaintiffs also seek to request the bailiff, District Attomeys’ Office of Dallas County, and the United States Marshall Service to take whatever steps are necessary to keep Defendants Eric and Christine Brauss in Dallas County, Texas at least until the hearing on a permanent injunction because they are flight risks and have already taken numerous steps to extricate themselves from this area, including moving books and records out of the partnership offices and imo private homes and firing all accounting staff associated with the partnerships, These facts, coupled with statements ric Brauss made to Plaintiff Helmut Landwehr on ‘November 22, 2009 that he must immediately leave the country or be put in jail make his flight a definite and imminent risk. PLAINTIFFS’ ORIGINAL PETITION AND APPLICATION FOR TEMPORARY RESTRAINING ORDER AND TEMPORARY INJUNCTIVE RELIEF, AND MOTION FOR APPOINTMENT OF AUDITOR - Page 624, The Plaintiffs also seek a motion to conduct expedited discovery to allow access to Defendants’ records to conduct a forensic image of all computer hard drives, make copies of all corporate records and accounting source documents, and conduct depositions of corporate representatives of said Defendants, as well as such other third parties that may have knowledge concerning the existence and location of corporate records, assets, and docaments. 25. Finally, Plaintifis seck permission ftom this Court to immediately notify the other investors in the TRA Investment Partnerships of the status of this case. ve SUPPORTING EVIDENCE 26. In support of the Petition, Plaintiffs have attached a true and correct copy of the Affidavit of Helmut Landwehr (Exhibit A). Vi FACTUAL BACKGROUND 27. TRA, Ine. was started by Erie and Christine Brauss. At the present time, TRA, Inc. is involved in the thirty-nine (39) active Operating Limited Partnerships for the acquisition of raw land and/or development of commercial property. Each of these partnerships has separate investors, but in general, a similar structure under which investors would fund an investment partnership, which would in turn contribute to an Operating Partnership. Certain of these partnerships were operated through TRA, Inc., others were operated through CDB Holdings (CDBH) and finally others were operated through Quorum Equities Group, LLC (“Quorum”). PLAINTIFFS' ORIGINAL PETITION AND APPLICATION FOR TEMPORARY RESTRAINING ORDER AND TEMPORARY INJUNCTIVE RELIEF, AND MOTION FOR APPOINTMENT OF AUDITOR - Page 7‘TRA Unser Investors, L.P. 28. Commencing in July of 2609, investor Helmut Landwebr (“Landwehr”) was contacted by Erie Brauss, in his capacity as President of TRA Unser Investors GP, Inc. (“TRA ‘Unser GP”) in connection with an investment in TRA Unser Investors LP (“TRA Unser LP"). ‘At that time, Landwehr was provided a letter dated July 29, 2009 (the “Tuly 29, 2009 Letter”). 29. ‘The purpose of TRA Unser LP was to acquire a ptoperty for purposes of constructing a JC Penney and Target located in Albuquerque, New Mexico. The property was scheduled to close on July 31, 2009. Under the terms of the July 29, 2009 Letter, Eric Brauss acknowledged that $2,038,000.00 of the TRA Investors’ monies that had been acquired to purchase the property had not been used to acquire the land, but rather were diverted to Today Financial LLC (“TFL") back in September and October of 2008, As set forth in the July 29, 2009 Letter, Eric Brauss offered as a compromise to provide a personal guaranty of the monies that had been diverted, as well as to place a security interest on certain collateral from TRA, Inc. CDB Parkovood Crossing 30. On approximately November 12, 2009, through a conversation with a developer, the Plaintiffs became aware that Bric and Christine Brauss, directly or indirectly, had diverted funds from another of the TRA Investment Partnerships. Specifically, in connection with CDB Parkwood Crossing, LP. (*CDBPC”), an investment limited partnership, Landwehr spoke with the developer, Don Silverman (“Silverman”), the principal of Margaux Development Company, regarding the operation and management of Margaux Parkwood Partners, Ltd. (“Margaux”), an operating limited partnership. Margaux was formed to develop a 31 acre large scale retail PLAINTIFFS’ ORIGINAL PETITION AND APPLICATION FOR TEMPORARY RESTRAINING ORDER AND TEMPORARY INJUNCTIVE RELIEF, AND MOTION FOR APPOINTMENT OF AUDITOR - Page 8shopping center on Highway 377 on North Tarrant Parkway in Tarrant County, Texas. CDBPC owns a limited partnership investment in Margaux. 31. Based upon the offering literature, the total investment, including debt and equity in Margaux, was $30,000,000.00. Six million ($6,000,000.00) of that amount would come from. investor equity to be invested by CDBPC into Margaux, and the remaining $24,000,000 would bbe loaned to Margaux from First United bank of McKinney. The total development cost of the project was estimated to be $30,000,000. 32. During the November 12, 2009 mecting, Silverman divulged to Landwehr that although the CDBPC investors had contributed the required $6,000,000 into CDBPC, that money was not contributed to Margaux. In fact only $1,979,927.28 of the investor's $6,000,000 has been transferred to Margaux. Instead, the CDBPC records reveal that Today Financial Corporation received $3,415,840, plus an “Equity Placement Fee” of $600,000 -- for monies that were diverted from their intended purposed. 33. A representative of the Plaintiffs contacted Eric Brauss in an effort to determine the location of the unaccounted-for proceeds, their disposition, and whether any other of the 38 investment partnerships had similar accounting diversions, On November 11, 2009, Helmut Landwehr contacted Erie Brauss to arrange a meeting to discuss the CDBPC and another investment partnership called Maruhn-Finanz-Partners XXV, L.P.(“Maruhn, L-P. ”) and its operating partnership TRA Portefino Tech, L.P. (“Portefino, L.P.”), Eric Brauss stated that he ‘was meeting with his personal attorney, Lary Friedman (“Mr. Friedman”), the first part of the week of November 16, 2009. PLAINTIFFS’ ORIGINAL PETITION AND APPLICATION FOR TEMPORARY RESTRAINING ORDER AND TEMPORARY INJUNCTIVE RELIEF, AND MOTION FOR APPOINTMENT OF AUDITOR - Page 9‘TRA Portefino Tech, LP. 34, Further, in 2003, Dr. Carsten Luetten (“Dr, Luetten”) invested the sum of $100,000 ia Maruhn, L.P. to be invested by Maruhn, L.P. into Portefino, L.P. Portefino, LP. property was subsequently sold at a loss, and proceeds of approximately $90,000.00 have been placed in an escrow account with Friedman and Feiger, LLP pending distribution to the respective partners, This statement has been confirmed to Landwehr by both Eric Brass and Sue Shelton, the CFO of TRA. 38. Thereafier, on November 17, 2009, Landwehr attempted to confirm with Eric Brauss that he would meet with him, At that time, Landwehr received an email from Brauss, indicating that he was on a “very primitive tour in the Amazon rainforest,” and that he could not change his flight, but would “call when I can.” ife indicated “T have a good plan to get this all worked out and explained.” 36. During this time, Landwehr traveled to the Defendants’ offices located at 17400 Dallas Phwy., Suite 216, Dallas Texas, and observed that the books and records from the offices were being removed and was told by Sue Shelton that the books and records of the Investment and Operating Partnerships were being transferred out of the business offices, delivered to storage, and that the associated accounting staff had all been fired. The accounting staff and Sue Shelton had been termninated or about November 9, 2009. 37. On Friday, November 20, 2009, Landwehr contacted Erie Brauss and had arranged a meeting with the investors’ committee in an attempt to deal with the whole situation PLAINTIFFS’ ORIGINAL PETITION AND APPLICATION FOR TEMPORARY RESTRAINING ORDER AND TEMPORARY INJUNCTIVE RELIEF, AND MOTION FOR APPOINTMENT OF AUDITOR - Page 10