Former marijuana entrepreneur and accused fraudster Scott Pack is at the center of two separate court actions — a criminal indictment that accused him of securities fraud, money laundering, forgery and a slew of cannabis-related offenses, as well as a lawsuit filed by two investors who say he bilked them out of $500,000 as part of a scheme that allegedly generated a total of $10 million.
But thus far, Pack has managed to delay judgment in either action. His attorneys argue that he shouldn't have to face the lawsuit until the conclusion of his criminal case, which was originally scheduled to take place in June but has now been put off until May 20, 2019.
At one point during a hearing, which took place in May in Denver District Court, David Kaplan, Pack's criminal attorney, told Judge Ross Buchanan that neither Pack nor his fellow indictee, Rudy Saenz, "is willing to participate in civil discovery."
"What do you mean they’re not willing to participate in...?" Buchanan asked. "This isn’t a...this isn’t an invitation to a garden party. They’ve been sued."
"The entity has been sued, correct," Kaplan replied, referencing Harmony & Green, the company at the center of both the criminal and civil complaints. "And, Mr. Pack and Mr. Saenz have their Fifth Amendment rights. They’re both, as you know, under an indictment in Arapahoe County. They’re not participating."
Civil litigation against Pack began with a suit filed against him in early 2017 by attorney Matthew Buck on behalf of Pierre and Christophe Raygot, the aforementioned investors. Also named was Michael Pack, father of Scott and a wealthy real estate developer based in San Diego.
In remarks to Westword shared that April, after the first suit was put forward but prior to the indictment, Scott denied any wrongdoing. He stated: "We have structured our business abiding by the governing laws and regulations and there is no reason why we would need to deceive our stakeholders, who still hold value in our company. We deny the allegations in this case, which will easily be proven false once facts and evidence are revealed in court."
Holding a different view is lawyer Henry Baskerville, who now represents the Raygots and authored an amended complaint in late 2017, owing to some legal complications.
"The defendants, and specifically Scott Pack, filed a motion to disqualify Matt Buck," Baskerville told us last year. "They argued that Mr. Pack had previously been represented by Matt Buck's partner, Rob Corry. Scott Pack had apparently come to their law firm looking for advice, and there was some dispute about whether he actually became a client or not — but the court determined that there were sufficient facts to create a conflict of interest between Matt Buck and Mr. Corry suing Scott Pack. So the court disqualified them from representing the plaintiffs."
The Raygots, who are both foreign nationals (Pierre is from Thailand, Christophe is based in Portugal) subsequently secured the services of Baskerville, who noted that the main events covered in the amended suit, also shared here, happened in 2015, when non-Colorado residents weren't allowed to put money directly into a cannabis concern here. The law was changed the following year.
"At the time, Pierre could not invest directly in a marijuana business," Baskerville said. "So it was represented to him that the legal way he could still participate in the industry was to invest in a company that would eventually own or manage properties in which a grow would operate. But he was given some conflicting information about what the structure would be, which is what we've tried to convey in the second amended complaint."
The suit maintains that Scott and Michael formed two enterprises named SMP Properties, LLC — one in Colorado, the other in Nevada — that were intertwined with Harmony & Green. According to Baskerville, the Colorado branch of SMP Properties "owned a facility in which a grow was operating in Denver and a facility in which a grow was operating in Colorado Springs. There were a number of times Scott represented over Facebook Messenger that they were obtaining new grows and looking for money to purchase a new facility — but it appears that those representations were not true."
In addition, Baskerville went on, "From what we've been able to gather so far, it appears that the money was funneled directly into the marijuana business, and we believe it was used to repay other investors or funneled into the Packs' pockets." The complaint also "provides more details about what we believe to be false statements made to our clients. For instance, Scott allegedly claimed that Harmony & Green "was worth $10 million, and he said he'd invested $2.5 million and Rudy's wife had invested $4 million. That wasn't true, from what we could tell."
There was also "some back-and-forth where Scott said they received $5 million in funding," Baskerville maintained. "We think that's false, too. And there's a long, detailed Facebook conversation where Scott said they needed a bridge loan of $400,000 because they had the opportunity to purchase a property for $1.6 million. Scott said they only needed the money for thirty to ninety days, and because they'd be getting a mid-month cash infusion of $500,000, the risk would be virtually nothing. But as far as we can tell, that was completely made up."
The accusations in the lawsuit are couched in cautious legalese. But a public apology posted on the now-defunct Harmony & Green website was far more blunt. The jeremiad maintained that after dad Michael paid for his son's bail and attorney's fees, Scott flew to Miami with Janette Pack, his significant other. Photos of the two showed them cavorting on the beach or canoodling outside "their $5K a month Harmony and Green 'office' in Cherry Creek." We've included two of the shots here.
For all of this, the page's anonymous author wrote: "We are sorry. You deserved better. You were played. So were we."
Today, Baskerville reveals that in May, Pack's legal team "filed a motion seeking to stay our case entirely — pause it until the criminal cases are fully resolved, which could take years if they're convicted and appeal. Scott's case was originally set for April before it was rescheduled for June, and Rudy's trial was set in October, the same week as our civil trial was supposed to take place. But his attorneys said the case should be stayed and the civil trial should be moved."
In Baskerville's opinion, "The judge was very unhappy about having to move the trial, but he reluctantly did it," choosing as a date February 11, 2019. "The idea was to wait until the end of Rudy's trial, so he would participate in discovery — and he has to do that regardless of if he's convicted or not. If he's convicted or he wins and is acquitted, he no longer has Fifth Amendment privilege, because he's no longer in jeopardy."
Trouble is, the civil case was also scheduled to get under way on February 11. Hence, the move of the trial to May 20, when it's been scheduled for five days. And while we don't know if Pack is sitting on a beach right now, he was living in Southern California at last report — and the area has no shortage of sand and water.
Click to read the Scott Pack hearing transcript and Pierre Raygot and Christophe Raygot v. Scott Pack, et al.