An Israeli woman claims she lost more than $250,000 after an escrow agent refused to release money she earned after selling hundreds of thousands of dollars worth of stock.
Liora Mayer, of Tel Aviv Israel, filed a lawsuit Aug. 3 in U.S. District Court for the Southern District of Illinois against Connelly Peterson, Shearer Sampson & Associates and West Coast Stock Transfer.
In her complaint, Mayer alleges Shearer agreed to purchase 14,000 shares of WFI stock from her on Feb. 16. Before the transaction's closing, Mayer agreed to place the stock with West Coast, which would serve as the escrow agent, according to the complaint. Upon closing, Mayer would receive the money from the sale of the stock, the suit states.
When Shearer discovered that Mayer owned an additional 11,000 shares of the same stock, he also offered to purchase those from her, the complaint says. Mayer and Shearer agreed to combine the February transaction with the 11,000 shares of stock into a single undertaking.
"Pursuant to the Purchase Agreement, the purchase price for Mayer's 25,000 shares would be $275,000, to be paid from an escrow account upon closing," the complaint says.
In June 2011, Mayer fulfilled her end of the agreement and placed her stock into West Coast's escrow account, according to the complaint. However, on the closing date – June 27 – West Coast refused to disburse the $275,000 to Mayer, the suit states.
Although Mayer has demanded numerous times that West Coast release the money to her, the company has refused to do so, she claims.
Finally, on July 28, West Coast representative and defendant Vince Carter agreed to release the money the following day, according to the complaint.
"In response to counsel's inquiries about the money, Carter stated that the 'money was never lost, it was tied up,'" the suit states. "'I am just following instructions and it will be released tomorrow regardless.'"
The money, though, was not released the following day, and Mayer has yet to receive it.
In her complaint, Mayer alleges breach of contract, fraud and recission against all the defendants. In addition, she alleges breach of fiduciary duty against West Coast and, in the alternative, conversion.
In addition to the money she claims West Coast owes her, Mayer is asking the court to rescind her original agreement to transfer the stock, to return the 25,000 shares of stock to her, to disgorge any benefits the defendants received in connection with the shares of the stock and to provide other relief the court deems just.
Donald J. Dahlman and James C. Cook of Walker and Williams in Belleville will be representing her. Peter M. Ellis and Steven J. Reynolds of DLA Piper in Chicago will serve of counsel.
U.S. District Court case number: 3:11-cv-669.