Anyone who has ever published a Web page has wondered about the possibility of being sued. It’s especially unnerving to imagine being sued by a powerful person or company. John T Reed is in exactly that situation right now. He’s being sued by a multi-millionaire and convincted criminal named Russ Whitney, and Reed is asking for help.
Who is John T. Reed?
Reed is a real estate investor who writes about real estate investing and property management. He was disturbed by some of the promises “real estate gurus” like Carleton Sheets and Robert G. Allen were making in their seminars, tapes, and TV commercials. As a result, he began posting his real estate guru ratings on his Web site.
As Reed says, the real estate guru business is something of a rogue’s gallery. Many of the gurus have gone bankrupt, served time in jail, been sued by state attorneys general, or flat out lied about their investment success. In one of the better known cases, Robert Allen (author of No Money Down) has gone bankrupt, and the head of one of his investment clubs went to jail for using the techniques in Allen’s book. Which leads us to the next guru.
Who is Russ Whitney?
Whitney is a real estate investing guru who sells seminars, tapes, and books, the best-known being Building Wealth. He’s CEO of Whitney Information Network, a thinly-traded bulletin board stock, of which he owns 81%. The SEC has advised Whitney Information Network that they need to restate their earnings. The restatement would wipe out all of the profits they’ve ever reported. The company’s liabilities are currently greater than its assets.
After Reed gave him a bad rating, Whitney filed a lawsuit against him in June, 2002. Rather than backing down, Reed decided to fight and to serve as his own counsel. The lawsuit is ongoing. There’s a progress report here.
What Reed and His Readers Have Uncovered About Whitney So Far
Using his own resources, and drawing on his reader’s help, Reed began investigating Whitney as part of the informal discovery process leading up to trial.
- Whitney is a convincted felon and ex-con. One of Reed’s fans ran Whitney’s name through a criminal database and found his record. Whitney was convincted of robbery in the second degree. He served a year and a half in prison in New York.
- Whitney lost a paternity suit. A reader searched the Lee County, Florida court Web site and discovered the case. Whitney – a married man – had an affair with one of his employees, got her pregnant, denied paternity, and then had to be sued to support the child.
- Whitney ran over a pedestrian. Reed says Whitney committed hit and run; Whitney says the summons for hit and run was the result of faulty reporting. The man he struck was left with permanent brain damage. Whitney was never prosecuted in criminal court, but he lost a $1.1 million civil suit.
- His business practices have gotten him in trouble with attorneys general in Tennessee, Pennsylvania, and Michigan.
It’s very likely he has more skeletons in his closet. That’s where you come in. The blogosphere is great at fact-checking. If you have access to any legal, criminal, or government databases, you could very well dig up more information about Whitney that would be useful at trial. If you’ve had dealings with Whitney or his company, that could be useful, too, especially if you have notes from his company’s seminars.
UPDATE: Reed and Whitney have settled as of July, 2005.