Opinion ID: 2814736
Heading Depth: 3
Heading Rank: 1

Heading: Mr. Templeton Sells Securities to the Cordaros

Text: From February 14, 2002 to September 15, 2005, Mr. Templeton worked as a registered representative for United Securities Alliance, Inc. (“USA”). During that time, he established a broker-customer relationship with the Cordaros. Between June 2004 and August 2005, Mr. Templeton sold the Cordaros the following five private placement investments totaling $515,000: In June 2004, the Cordaros purchased (1) a $100,000 three-year note and (2) a $130,000 five-year note in Medical Provider Financial Corporation II (“MedCap II”), a subsidiary of Medical Capital Holdings, Inc. (“MedCap Holdings”); (3) a $150,000 investment instrument in Triple Net NNN 2003 Value Fund LLC (“Triple Net”); and (4) a $100,000 investment instrument in DBSI State Office Fund, LLC (“DBSI”). In August 2005, they purchased an additional (5) $35,000 five- 1 Mr. Templeton initially filed a notice of appeal as to the Catlin judgment (No. 14-1261) before final judgment as to all defendants and without district court approval under a Federal Rule of Civil Procedure 54(b) certification. Catlin moved to dismiss the appeal because the judgment was not final. At Mr. Templeton’s request, the district court subsequently entered a Rule 54(b) certification as to its judgments against Catlin and Mr. Hall, making Mr. Templeton’s appeal as to Catlin valid. Mr. Templeton also filed a notice of appeal of the judgment in favor of Mr. Hall at that time (No. 14-1381). After the district court granted summary judgment to the attorney-defendants, it entered a final judgment dismissing the action. Mr. Templeton then filed a notice of appeal as to the attorney-defendants (No. 14-1453). The motion to dismiss is denied as moot because the judgment as to all defendants is now final and appealable. -5- year note in MedCap II. In total, the Cordaros invested $265,000 in MedCap II while Mr. Templeton was employed with USA. On September 16, 2005, Mr. Templeton began working at CapWest. The Cordaros transferred their investment account to CapWest. In June 2007, the Cordaros’ investment on their $100,000 MedCap II note matured. They worked with Mr. Templeton to reinvest the $100,000 they received into a seven-year note in Medical Provider Financial Corporation IV (“MedCap IV”), another subsidiary of MedCap Holdings. CapWest was the broker-dealer on the MedCap IV transaction. In fall 2008, the Cordaros stopped receiving payments on all of their investments with Mr. Templeton, including the MedCap IV investment. In July 2009, the U.S. Securities and Exchange Commission (“SEC”) sued MedCap Holdings for violating federal securities laws. In August 2009, the district court appointed a temporary receiver and then a permanent receiver for MedCap Holdings and its subsidiaries, including MedCap IV. The court’s orders also froze MedCap IV’s assets.