Fed. Sec. L. Rep. P 99,447 United States of America v. Frank E. Jones, James R. Jamerson, and Richard Eugene Webber, Defendants

This case presents several issues. Foremost among them is whether defendants’ sale/leaseback transactions were “securities” within the meaning of the securities fraud statute, 15 U.S.C. § 77q. We hold that they were and affirm the convictions on all counts.

FACTS

In 1976, Jones brought Jamerson into Evergreen Investors, a trucking brokerage company that was experiencing financial difficulties. To alleviate Evergreen’s difficulties, Jones and Jamerson joined several smaller investors in purchasing Krimbel Trucking, a company hauling loads between Washington and California.

Jamerson became Krimbel’s president and Jones its vice-president. Jones handled the financial arrangements for the company while Jamerson, who had been a truck driver and owner of his own trucking company, assumed responsibility for Krimbel’s day-today operations.

Misapplication of Funds

Early in 1977, Jones and Jamerson began to draw checks on Krimbel’s account to pay obligations of Evergreen. They made payments from Krimbel’s account on Evergreen’s commercial loans and extended to it “interest-free” loans.

Later in 1977, Webber joined Jones and Jamerson in depleting Krimbel’s assets. The defendants used…