Don Johnson, the
former Duneland real estate agent who was seeking the dismissal of eight of
the 19 felony charges filed against him on the ground that the statute of
limitations has expired, has been stymied by the Indiana Court of Appeals.
In December the
Court of Appeals denied--without comment--Johnson’s motion for an
Johnson filed that
motion in September, after Porter Superior Court Judge Roger Bradford ruled
that the statute of limitations had not expired.
The eight counts in
question--four alleging that Johnson sold unregistered securities, for a
Tennessee real estate development; four that he was not himself registered
to be a seller of securities--are all Class C felonies, and under Indiana
Code persons accused of committing a Class C felony must be charged with a
crime no later than five years after they allegedly committed it. The date
of the earliest of the eight alleged offenses is July 2007, not quite seven
years before Johnson was formally charged, in March 2014; the date of the
latest, March 2008, almost exactly six years before he was charged.
Prosecutors, on the
other hand, argued that, per Indiana Code, the statute of limitations was
“tolled”--that is, paused or delayed--because Johnson actively concealed the
commission of the alleged crimes, by structuring the promissory notes which
he issued to investors to mature after a period of five years.
argued that Johnson concealed the commission of the alleged crimes by his
“failure to speak, when he had a legal duty to do so”--that is, by his
alleged failure to inform investors that the securities in question were
unregistered as was he.
In August, Judge
Roger Bradford denied Johnson’s motion.
On Sept. 30,
however, Johnson filed a motion for an interlocutory appeal with the Indiana
Court of Appeals, in which he maintained that Bradford’s denial would cause
him “to suffer substantial expense, damage, and injury if the order is
erroneous and the determination of the error is withheld until after
judgment.” That’s because, in order to defend himself, Johnson, his
attorney, and investigators would have “to travel to Tennessee to retrieve
documents, locate witnesses, and gather evidence regarding the Tennessee
development project,” according to Johnson’s motion.
They would also
have to travel to Wisconsin, to locate and interview Johnson’s late
partner’s ex-wife; and they would have to retain “experts” to “examine real
estate development projects and expenses related to the development
Johnson wanted the Court of Appeals to rule on “a substantial question of
law,” namely, on whether or not he engaged in “any additional acts of
concealment,” beyond the alleged one of structuring the promissory notes to
mature after five years.
All of this is
beyond the point, prosecutors maintained, since trips to and investigations
in Tennessee and Wisconsin are red herrings, inasmuch as the core issue is
whether or not Johnson sold unregistered securities and whether or not he
was registered to be a seller of securities. “Even if the state were to
stipulate, and it will not, that the development was wildly successful,
because it was not, the defendant could still be found guilty of each of
these charges,” Prosecuting Attorney Brian Gensel stated.
maintained that Johnson was asking the Court of Appeals to rule on an issue
which is, in fact, a matter for the jury. “The state alleged facts that the
defendant concealed evidence of his offenses in the manner in which he
structured the securities and by failing to inform the investors that
neither he nor the securities were registered,” Gensel states. “Whether the
facts support these allegations, and whether these allegations are
concealment, is a question for the jury.”
Johnson has been
charged with the following:
* Seven counts of
securities-registration violation, alleging that he sold unregistered
* Seven counts of
broker-dealer registration violation, alleging that he sold securities
without being registered to do so.
* Three counts of
securities fraud, alleging that he employed a scheme to defraud, made an
untrue statement of material fact, or otherwise engaged in deceitful
* One count of
forgery, alleging that he signed a dead woman’s name on an insurance check.
* One count of
theft, alleging that he then stole the insurance check.
Among other things,
the original probable cause affidavit filed by the Chesterton Police
Department alleges that one of Johnson’s victims was a woman who belonged to
Johnson’s church, to whom he promised a 30-percent return on a $60,000
investment from the woman’s National Steel retirement account. Five years
after signing the promissory note, Johnson told the woman that a downturn in
the economy had halted work on the real estate project, yet the woman kept
receiving statements from a trust company showing a balance of $59,000 or
more and didn’t realize that she’d lost all of her money until she talked to
her son about the situation, the affidavit states.
Johnson’s Broker’s License
Johnson was for
years a familiar face in the Duneland real estate market. Then, in November
2010, the Indiana Attorney General’s Office brought a 33-count
administrative complaint against him alleging numerous improprieties. In
June 2012, Johnson and the Indiana Real Estate Commission (IREC) reached a
negotiated settlement under which the IREC suspended his broker’s license
for three years and ordered him to pay $15,000 in consumer restitution.
But when Johnson
failed to pay the first $5,000 installment of that restitution, the IREC
revoked his broker’s license permanently.
The IREC had
previously concluded the following about Johnson’s practices:
* That he “engaged
in material deception” by providing advice on bankruptcy filings without a
license to practice law.”
* That he had
“become unfit to practice due to failure to keep abreast of current theory”
as well as to “professional incompetence.”
* That Johnson
failed to notify a client whose house he said he would purchase that the
property was subsequently sold at a sheriff’s sale, but he continued to
collect rental payment totaling $1,800 from the tenants of the property
while at the same time failing to pay the mortgage on the property.