A motion to dismiss was filed on behalf of a deceased defendant accused of participating in an alleged bid rigging conspiracy with former Madison County Treasurer Fred Bathon.
Attorney Natalie Kussart of Sandberg Phoenix & von Gontard PC in St. Louis filed a motion to dismiss on behalf of defendant Barrett Rochman, who died on Jan. 6.
Kussart wrote that a suggestion of death was filed Feb. 19. The plaintiffs allegedly had 90 days to file a substitute of party for Rochman, which would have been May 20. However, Kussart wrote that they have failed to file a substitution.
“Plaintiffs have failed to meet their statutory requirement to substitute parties for the decedent, and as such, this matter must be dismissed as to Barrett Rochman,” the motion states.
Rochman was named a defendant in the third amended class action filed by attorney Nelson Mitton of St. Louis on Sept. 25, 2017. The class alleges Bathon arranged for tax buyers to charge interest at the maximum legal limit of 18 percent at auctions of delinquent property taxes from 2005 to 2008.
The plaintiffs allege Bathon conspired with each tax purchaser defendant to establish a “no trailing bid” policy, meaning the process required one-time, simultaneous bidding. Rather than allowing a series of bids, all bidders had to bid at once, with the auctioneer accepting the lowest bid that was heard.
The defendants allegedly then made an agreement with Bathon to bid the maximum of 18 percent in the simultaneous bidding.
Mitten wrote that Bathon used a seating chart to ensure that the tax purchaser defendants would be recognized by the auctioneer and the Madison County employees conducting the sales as the winning bidders.
The plaintiffs allege auctioneer James Foley was supposed to “foster competition in order to obtain the lowest penalty percentage.” However, Mitten wrote that he agreed to act in concert with the conspiracy by accepting the bids at the maximum rate.
The plaintiffs allege that as the actions of the tax purchaser defendants became evident, other purchasers also began bidding higher than they otherwise would have.
“Because there was no or virtually no competitive bidding, the bidding was rigged, prices were fixed, and almost every single property was sold at the statutory maximum penalty percentage of 18%,” Mitten wrote.
Then after Bathon resigned, every annual tax sale conducted has resulted in an average penalty bid of less than 5 percent, the suit states.
The plaintiffs allege that in return for rigging the tax sales, Bathon received campaign contributions and support from tax purchasers.
Bathon was charged in February 2013 with violating the Sherman Antitrust Act. He pleaded guilty the same day. Defendants Scott McLean, Barrett Rochman and Joe Vassen also entered guilty pleas to federal antitrust charges in October 2013.
The complaint was originally filed on Feb. 13, 2013, and has gone through years of litigating to determine which defendants are proper . Madison County moved for dismissal as a defendant in the original complaint, and the trial court dismissed counts for conspiracy and respondeat superior for failure to state a cause of action.
In response, two new class actions were filed in March 2013. The plaintiffs in the original case then filed a consolidated amended complaint on Feb. 24, 2014. A second amended complaint under the theory of res judicata was filed on July 11, 2014.
Madison County was again dismissed as a defendant when the Fifth District Appellate Court concluded that the plaintiffs could not state a valid claim against the defendant. Fayette County Associate Judge J. Marc Kelly then granted the plaintiffs’ request to amend their complaint to rejoin Madison County and former treasurer Kurt Prenzler as defendants following Bathon’s May 2017 deposition. Prenzler currently serves as Madison County Board Chairman.
During his deposition, Bathon testified that numerous Madison County officials knew of, and participated in, the alleged conspiracy.
Madison County moved for dismissal again arguing that the complaint is barred by the doctrine of res judicata, the doctrines of waiver and collateral estoppel, and the statute of limitations. Kelly granted the motion on May 22, 2020.
Claims against tax-buyer defendants and county officials remain pending.
Several defendants filed motions for summary judgment in January 2019. A hearing had been set for Dec. 13, but the docket does not yet reflect any rulings on those motions.
The defendants seeking summary judgment have made various arguments, including allegations that the plaintiffs’ claims are barred by the statute of limitations and that several defendants were not involved in a conspiracy with respect to sales of delinquent property taxes in Madison County.
The plaintiffs responded by filing memorandums in opposition to the defendants’ motions for summary judgment, arguing that there is “ample” evidence for the jury to find that the defendants agreed to the collusion and participated in the conspiracy.
Madison County Circuit Court case number 13-L-276