Pittsburgh federal court
PITTSBURGH - On July 17, a Pennsylvania man called out Alternative Energy Holdings LLC and others in the U.S. District Court for the Western District of Pennsylvania for what he claims was a shady investment deal.
Donald V. Porreca sued Alternative Energy; Kevin T. Carney (manager and CEO of AEH); Robert Irey and Jonathan Freeze (AEH managers); law firm Dodaro, Matta and Cambest P.C.; DMC Bradley; and Michael J. Hammond and Steven M. Toprani (partners with DMC and DMC Bradley).
Freeze spoke to Porreca about investing in AEH around July 2017, it is alleged. Porreca had some concerns about the legitimacy of the venture, but Freeze guaranteed it, Porreca said.
Porreca says he was one of 23 people who invested in AEH. He sent $100,000 to AEH's bank account for 2,500 membership units on the promise that Freeze would repay the $100,000 for half of the dividends and disbursements from those units, according to the lawsuit. Carney conducted the transaction, the suit says.
Porreca later learned Carney had pleaded guilty to grand theft and forgery in December 2016 following a grand jury indictment, the suit says.
Freeze, registered as a securities representative with Fortune Financial Services Inc. at the time, provided and sold AEH notes to his clients, the suit says.
In October 2015, he had agreed to a Letter of Acceptance, Waiver and Consent (AWC) with the Financial Industry Regulatory Authority and was suspended 10 days and fined $5,000 for taking money from a customer, the lawsuit said. Later, in June 2017, FINRA told Freeze about another investigation against him, the suit said.
Freeze signed another AWC but refused to provide documents and information to FINRA, so he was permanently removed from the securities industry in August of that year, the lawsuit said.
In 2016, AEH entered a joint venture agreement with D4 Energy Group in which AEH would provide funding for predevelopment working capital for alternative energy processing plants. Carney was the authorized member of AEH who signed that particular agreement, less than a week before the grand jury indicted him, the suit says.
In June 2016, Carney, Irey and Freeze sold investments in the joint venture agreement. DMC and Toprani represented Irey and Freeze before the agreement, and Hammond represented Irey and Freeze when potential investors were being contacted for AEH, the suit says. DMC Bradley was then created in January 2017, and DMC and DMC Bradley via Toprani and Hammond backed Irey and Freeze in April 2017 along with AEH and Carney, the suit says.
Porreca is calling out the defendants for failing to tell him about Carney’s criminal conviction, Freeze’s FINRA suspension and the notion that the AEH membership didn’t comply with the Securities and Exchange Commission and the West Virginia Securities Commission.
"At no time did plaintiff Porreca receive any information which would adequately value AEH membership units, and upon information and belief, the AEH membership units are virtually worthless,” the lawsuit said.