Amended Complaint From Mike Cox

Case 1:16-cv-01116-JTN-ESC ECF No. 62 filed 03/09/17 PageID.
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UNITED STATES DISTRICT COURT

WESTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
CHRISTOPHER JEROME, an individual,

LEO JEROME, an individual, and
STORY COMPANIES, LLC,
a Michigan limited liability company,
Plaintiffs,
v. Case No.: 1:16-cv-01116

Hon. Janet T. Neff
PLAINTIFFS DEMAND A
TRIAL BY JURY
JOEL FERGUSON, an individual,
VIRGIL BERNERO,
the Mayor of the City of Lansing, in his individual capacity,
LANSING ECONOMIC AREA PARTNERSHIP, INC.,
a Michigan non-profit corporation,
ROBERT L. TREZISE, JR., an individual,
CLARK CONSTRUCTION SERVICES, LLC,
A Michigan limited liability company,
CHARLES CLARK, an individual,
FRANK KASS, an individual,
CONTINENTAL DEVELOPMENT, INC., an Ohio corporation,
HALLMARK CAMPUS COMMUNITIES,
an Ohio partnership,
FERGUSON DEVELOPMENT, LLC,
A Michigan limited liability company,
CHRISTOPHER STRALKOWSKI, an individual,
FERGUSON/CONTINENTAL LANSING, LLC,
A Delaware limited liability company, and
RED CEDAR INVESTOR, LLC, a Michigan limited liability company,
Defendants.
FIRST AMENDED COMPLAINT
Plaintiffs, Christopher Jerome, Leo Jerome, and Story Companies, LLC, by and though
their attorneys, the Mike Cox Law Firm PLLC, for their First Amended Complaint against
Defendants state as follows:
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Case 1:16-cv-01116-JTN-ESC ECF No. 62 filed 03/09/17 PageID.252 Page 2 of 47
PARTIES
1. Plaintiff, Christopher Chris Jerome resides in Chicago, Illinois and is a citizen of
the State of Illinois.
2. Plaintiff Leo Jerome resides in Holland, Michigan and is a citizen of the State of
Michigan.
3. Plaintiff Story Companies LLC, is a Michigan limited liability company with its
principal place of business in Michigan with an address of 1919 S. Creyts Road, Lansing, MI
48917.
4. Defendant, Joel Ferguson, is a principal and member of Ferguson Development
LLC. Ferguson is a citizen of the State of Michigan. Ferguson is a member of the Michigan State
University Board of Trustees and its former Chairman.
5. Defendant, Virgil Virg Bernero is the mayor of the City of Lansing, a citizen of
the State of Michigan, and is being named in his individual capacity only.
6. Defendant, Lansing Economic Area Partnership, LEAP, is an Internal Revenue
Service 501(c)(6), Michigan not-for-profit corporation with its principal place of business located
in Lansing, Michigan, and acts as an agent of or on behalf of the Lansing city government.
7. Defendant, Robert Bob L. Trezise (Trezise), is the Chief Executive Officer of
LEAP. Trezise is a citizen of the State of Michigan.
8. Defendant, Clark Construction Services, LLC, (Clark Construction), is a
Michigan limited liability company with an address of 3535 Moores Drive, Lansing, Michigan,
with its principal place of business located in Lansing, Michigan. Clark Construction is a building
and civil construction general contracting firm.
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9. Defendant, Charles Chuck Clark (Clark), is a principal of Clark Construction.
Clark is a citizen of the State of Michigan.
10. Defendant, Frank Kass (Kass), is a principal of Continental Development, Inc.
Kass is a citizen of the State of Ohio.
11. Defendant, Continental Development, Inc., (Continental), is an Ohio corporation,
with its principal place of business in Ohio.
12. Defendant, Hallmark Campus Communities (Hallmark), is an Ohio partnership,
with its principal place of business in Ohio.
13. Defendant, Ferguson Development, LLC (Ferguson Development), is a
Michigan limited liability company with its principal place of business located at 1223 Turner
Street, Lansing, MI 48906.
14. Defendant Christopher Stralkowski (Stralkowski) is the Executive Project
manager and officer of Ferguson Development and citizen of the State of Michigan. Stralkowski
is Joel Fergusons son-in-law.
15. Defendant Ferguson/Continental Lansing, LLC, is a Delaware limited liability
company with its principal place of business located in Lansing, Michigan. Defendants Red Cedar
Investor, LLC, and Continental Development are members of Ferguson/Continental Lansing,
LLC.
16. Defendant, Red Cedar Investor, LLC, is a Michigan limited liability company with
its principal place of business located in Lansing, Michigan. Joel Ferguson is a member of Red
Cedar Investor, LLC.
17. None of the Defendants are entitled to governmental immunity.
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JURISDICTION AND VENUE
18. This Court has subject matter jurisdiction over this action pursuant to 28 U.S.C.
1331 because Plaintiffs claims arise under the United States Constitution and laws of the United
States.
19. Additionally, as explained more fully below, Defendants have violated the
Racketeering Influenced and Corrupt Organizations Act (RICO), and this Court also has
jurisdiction over this matter pursuant to 18 U.S.C. 1964(a).
20. Further, Defendants have violated Plaintiffs constitutional rights and this Court
has jurisdiction under 42 U.S.C. 1983 and 1988.
21. This Court has supplemental jurisdiction over the state law claims pursuant to 28
U.S.C. 1367(a) because they form part of the same case or controversy as the federal claims.
22. This Court has personal jurisdiction over all Defendants.
23. Venue is proper in this judicial district pursuant to 18 U.S.C. 1965 and 28 U.S.C.
1391.
GENERAL ALLEGATIONS
Overview of the case.
24. Defendant Joel Ferguson has been running and continues to run a racketeering
enterprise (Ferguson Enterprise or Enterprise) with his son-in-law, Christopher Stralkowski
through their company, Ferguson Development LLC (Ferguson Development). Joel Ferguson
and Stralkowski misuse Fergusons political influence to create a pay-to-play system for
municipal and state contract approvals, political favors, and access to public tax dollars related to
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public contracts for highly profitable land development projects focused primarily in and around
the City of Lansing.
25. Ferguson Development is and has been Fergusons instrument of corruption and
improper political influence for personal financial gain for over two decades. Ferguson is the
leader of the Ferguson Enterprise and he makes all of the significant decisions.
26. Stralkowski has been involved in the Enterprise as project manager and officer of
Ferguson Development, the conduit for Fergusons messages to the Plaintiffs, as well as to
various political officials, and has also been involved in the political aspect of the Enterprise by
serving as Fergusons campaign manager.
27. Ferguson Development was formed as a limited liability company in 1998.
Ferguson listed Ferguson Development LLC on his Michigan State University business cards
and Ferguson Developments contact information was listed on Fergusons MSU trustee
webpage (although it was deleted after this lawsuit was filed).
28. Ferguson and Stralkowski work together to steer lucrative public contracts to
themselves or to their affiliates, such as Chuck Clark and his company, Clark Construction. In
doing so, Ferguson and Stralkowski engage in a pattern of racketeering, for example, by engaging
in fraud with the aid of the mail, prohibited by 18 U.S.C. 1341, or with the aid of wire
communications, prohibited by 18 U.S.C. 1343, and/or through extortion and bribery, in
violation of the Hobbs Act, 18 U.S.C. 1951 and Michigan Compiled Laws 750.213 and 750.117.
29. Here, Ferguson, through his Enterprise and his cohorts, conspired with the Mayor
of Lansing, Virgil Bernero, (Mayor Bernero or Bernero), the Lansing Economic Area
Partnership (LEAP), and LEAP CEO Robert Trezise to rig the public contracting process in a
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successful effort to steal a development from the Plaintiffs called the Red Cedar Renaissance
Project (formerly known as the Capital Gateway Project), (the Project). Currently, the Enterprise
is involved in the Project through another company, Ferguson/Continental, LLC, owned and
controlled by Ferguson, Red Cedar Investor LLC, along with co-defendants Frank Kass and
Continential Development Inc. As a result of the Enterprise acts, Mayor Bernero, LEAP, and
Robert Trezise awarded the Project on a no-bid basis to Ferguson/Continental, LLC.
30. Ferguson used a carrot-and-stick tactic to steal the Project from the Plaintiffs:
Ferguson and Stralkowski would first misrepresent to the Plaintiffs that for increasingly higher
equity stakes the Enterprise would assist Plaintiffs in acquiring and then retaining the valuable
awarded Request for Qualifed Proposals for the Red Cedar Renaissance Project (RFQP.) Then,
Ferguson and Stralkowski would alternatively threaten that they, through the Enterprise, would
use their political power to initially prevent the Plaintiffs from winning the RFQP, and then once
the valuable RFQP was awarded, take the RFQP away from the Plaintiffs unless Plaintiffs
surrendedered increasing equity stakes in the Project.
31. As set forth in more detail below, Ferguson used mail and wire communications to
set up meetings to perpetuate the Enterprises scheme, and to represent his cooperation to the
Plaintiffs, while at the same time working behind their backs to steal the Project for his own
benefit, interfere with Plaintiffs business relationships and expectancies, and use bribes (in the
form of political support) and extortion against public officials, including Mayor Bernero and
Robert Trezise of LEAP, to influence them to do Fergusons bidding.
32. When the Plaintiffs did not fully accede to Fergusons demands for equity and
control, Ferguson made good on his and Stralkowskis threats.
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33. Ferguson ordered Mayor Bernero and LEAP CEO Trezise to take the Project from
the Jeromes, and to award the Project on a no-bid basis to Ferguson/Continental LLC, which is a
joint venture between Fergusons other company, Red Cedar Investor, LLC, and Frank Kasss
company, Continental in violation of Lansing contracting ordinances.
34. The other Defendants are developers and contractors who have worked together
with Ferguson and his Enterprise, conspired with the Enterprise, and have financially benefitted
from the pay-to-play system orchestrated by Ferguson, specifically here from the efforts to steal
the Project from the Plaintiffs.
35. The Defendants racketeering and efforts to interfere with the Plaintiffs business
relationships and expectancies did not stop with the Project. The Defendants also actively
interfered with the Jeromes efforts to sell property to Developer A, a national developer, by directly
contacting and threatening Developer As representatives. As a result, the Jeromes suffered
monetary damages.
36. This illegal racketeering, violations of 42 U.S.C. 1983, and tortious interference
with the Plaintiffs business expectancies continue as Ferguson and his co-conspirators are
currently attempting to misuse this same political power to push the Ingham County Board of
Commissioners to approve $35 million in public bond money for Fergusons and the other
Defendants private gain, causing financial harm to Lansing city and Ingham County taxpayers.
The Beginnings of the Project.
37. The Jeromes owned, inter alia, two car dealershipsStory Oldsmobile Story
Olds and Sawyer Pontiaclocated across from each other on the key commercial strip of
Michigan Avenue, which is a gateway between the cities of Lansing and East Lansing. For the
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past 60 years, these properties have been highly valuable because of their prominent and key
location.
38. Leo Jerome ran the two dealerships for most of the last 40 years. However, in 2009,
with the closure of Oldsmobile by General Motors, and then subsequent bankruptcies of General
Motors and Chrysler, Leo Jerome closed Story Olds and Sawyer Pontiac. The properties, which
total approximately 8 acres, became vacant for the first time in decades.
39. Around the same time, Chris Jeromea Harvard Business School graduate who
worked in Silicon Valley managing investment funds with assets as much as $6 billionconceived
and began to develop a plan to recruit major national investors and retailers to Lansing to transform
the vacant parcels of land into a large, mixed use development.
40. Chris Jerome began contacting professional developers across the nation including
Carpenter & Company of Cambridge, Massachusetts, Campus Crest of Charlotte, North Carolina
and Continental Development of Columbus, Ohio. All of the contacted developers actively engage
in interstate commerce as developers, investors, and financiers of multi-million-dollar
developments.
41. Over this two to three year preliminary development period, Chris Jerome
telephoned, emailed, and flew across America to meet potential developers, brokers, and financial
institutions to induce the investment and spending of tens of millionsand eventually hundreds
of millionsin goods and services that would flow across state lines into Michigan.
42. Chris Jerome spent hundreds of hours and several hundred thousand dollars in costs
to achieve these goalsincluding for architectural renderings of the Project before 2012.
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43. During 2011, Chris Jerome met Frank Kass, Continentals chairman. Chris Jerome
proposed a joint venture between the Jeromes, Kass, Continental and its related companies to
develop the Jeromes properties and adjacent vacant Red Cedar municipal golf course.
44. Kass agreed to a joint venture and used one of Continentals subsidiaries as the joint
venture vehicle. Kass subsequently characterized this agreement as one large joint venture
between a Continental Hallmark entity and the Jerome Family. (Ex. 1, Mar. 2, 2012 emails from
Kass re Joint Venture.)
Jeromes propose their game-changing plan to Mayor Bernero of Lansing who directs them
to secure Fergusons support because Ferguson controls the necessary City Council votes.
45. With a joint venture agreement with Frank Kass and his companies, Continental
and Hallmark, in place, the Jeromes approached the City of Lansing to share their plan.
46. In May 2012, the Jeromes met with Mayor Bernero numerous times in his office.
Bernero called their project game-changing and told the Jeromes that their development plan
would need the support of the Lansing City Council, and insisted the Jeromes meet with Joel
Ferguson because he controlled a majority of the City Council members votes.
47. Joel Ferguson is one of the States longest-tenured and most influential political
power brokers: from his initial election as Lansing City Council member in 1967, to his recent
decade-long chairmanship of the Michigan State University of Trustees, where he controlled
hundreds of millions of dollars in annual spending, Ferguson has wielded his political influence
for his private gain.
48. As former Chairman and long-time member of the MSU Board of Trustees,
Ferguson has an outsized role in university investment, university student housing locations,
university economic development Projects, and university hiring and employment, which all
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directly impact the City of Lansing and the political fortunes of its elected officials including
Mayor Bernero.
49. In both oral and written communications during the course of the Project, Ferguson
told Leo and Chris Jerome that he controls four of the eight votes on the Lansing City Council.
50. On June 6, 2012, the City of Lansing and Lansing Economic Development
Corporation (LEDC)1 jointly issued a Request for Qualifications and Proposals (RFQP) for
the Sale and Development of Red Cedar Renaissance Site with proposals due on July 9, 2012.
Eventually, the Jeromes would submit the winning response to the RFQP, and be awarded the
Project.
51. The RFQP stated in relevant part as follows:
The Lansing Economic Development Corporation (LEDC) and City of Lansing are
releasing this RFQP to make potential developers and other interested parties aware
of a great development opportunity. The objective of this RFQP is to identify one
developer who has the vision, experience, capacity and financial wherewithal to
purchase and develop this site to its maximum potential. The selected developer
will enter into a planning and negotiation process with the LEDC and City that
should ultimately result in a Comprehensive Development Agreement. (Ex. 2, at 1,
RFQP excerpts) (emphasis added).
52. The RFQP also specifically required that Each responding developers
proposal must identify its authorized agent who has unqualified authority to bind the
developer with regard to all matters arising from or related to this process. (Id. at 7.)
(emphasis added).
53. Mayor Bernero appoints all nine board members of the LEDC. LEDC
contracts with the Lansing Economic Area PartnershipLEAPto provide LEAPs
1
Defendant LEAP subsequently took over the RFQP and the Project award process.
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officers and staff to assist in LEDC and City of Lansing economic development efforts.
Consequently, Mayor Bernero controls both the LEDC and LEAP.
54. Following Mayor Berneros order to meet with Ferguson, on or about June
18, 2012, Chris and Leo Jerome met with Ferguson and Fergusons Project manager and
son-in-law, Christopher Stralkowski. Ferguson or his agents set-up and/or confirmed this
meeting using wire communications or the telephone. At this meeting:
a. Ferguson told the Jeromes he would help free of charge because it
was the right thing for Lansing.
b. Ferguson promised Chris Jerome that Ferguson would obtain the votes
of a majority of the Lansing City Council to support the Project.
c. Ferguson explained that his position as the Chairman of Board of
Trustees at MSU gave him great power and political clout in Lansing.
d. Ferguson showed the Jeromes his business card, which listed his title as
Chairman of the Board of Trustees at MSU. He laughed and stated that
the business card is all he needs to push the Capital Gateway Project
through the Lansing City Council.
55. Fergusons representations at this meeting that he would help the Jeromes
free of charge were false. Instead, Ferguson and Stralkowski, through the Ferguson
Enterprise, began to lay plans to steal the Project from the Jeromes.
56. Ferguson made his false representations regarding cooperation to gain
access to the Jeromes valuable pre-bid work, intellectual property, and business contacts
to benefit the Defendants.
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Initial offer of free help leads to insertion of Ferguson partners into the Project.
57. Shortly after the June 18, 2012 meeting, Chris Jerome met with LEAP CEO Bob
Trezise at LEAPs offices in Lansing.
58. Trezise told Jerome that area businesses received preferential access to municipal-
related business opportunities in exchange for contributions to LEAP.
59. Trezise also said that Jerome must use LEAP investors and LEAP preferred vendors
for the Project or the Project would never be approved by the Lansing City Council.
60. A few days after the June 18, 2012 meeting, Chris Jerome again met with Ferguson
who told Chris Jerome that Jerome must hire a local general contractor for the Project.
61. Ferguson stated that Chuck Clark and Clark Construction were a good fit to be a
general contractor.
62. At this same meeting Ferguson told Chris Jerome that Ferguson and Clark had a
business referral relationship.
63. As former Chair and member of the Finance Committee within the Michigan State
Board of Trustees, Ferguson has steered hundreds of millions of dollars in valuable university
contracts to Defendant Chuck Clark and his company, Defendant Clark Construction. Some of the
more recent contracts include:
a. $88 million for the MSU Grand Rapids Biomedical Research Center at
Secchia Medical School. It is currently under construction,
https://app.oxblue.com/open/msu/grrc, with an anticipated opening in 2017;
b. $69 million for the MSU Bioengineering Research Facility on campus in
East Lansing;
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c. $49.8 million for the MSU Brody Hall dormitory expansion and renovation;
d. $66.5 million for the MSU Spartan Stadium expansion;
e. $17.1 million for the MSU Food Science Building;
f. $13.2 million for the MSU Shaw Hall dormitory dining room renovations;
g. $10 million for the MSU University Library Expansion/Renovation;
h. $10.2 million for MSU Emmons Hall dormitory renovations;
i. $8.5 million for MSU Clinical Center Facility C Wing; and;
j. $2.25 million for MSU Union renovation.
64. On July 9, 2012, Chris Jerome submitted the Project proposal to the City of Lansing
and LEAP. The Project proposal was paid for and created by Chris Jerome and his family.
65. As required by the RFQP, the Project proposal named Christopher Jerome as its
Authorized Agent to meet the RFQPs requirement that each proposal must identify its
authorized agent who has unqualified authority to bind the developer with regard to all matters
arising from or related to this process. (Ex. 2, at 7.)
66. On August 13, 2012, the City of Lansing announced Chris Jeromes Capital
Gateway Project proposal was selected as the RFQP winner.
67. From August 13, 2012 through November 6, 2012, Chris Jerome campaigned
tirelessly as the Projects public face to rally public support for the November 6, 2012 ballot
initiative needed to approve the sale of the public property for the Project.
68. On November 6, 2012, Lansing voters approved the sale of the entire Red Cedar
Golf Course property for the Project.
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Ferguson and Stralkowski operate the Ferguson Enterprise to commit a series of predicate acts
including mail fraud, wire fraud, and extortion to gain larger equity stakes of the Project from
Plaintiffs.
69. On numerous occasions between June 21, 2012 and July 9, 2012, the date the
Capital Gateway Project proposal was submitted to the City and LEAP in response to the RFQP,
either Fergusons secretary at Fergusons direction or Stralkowski telephoned Chris Jerome in
Chicago to set up meetings to discuss the Project.
70. In response to calls or emails from either Fergusons secretary or Stralkowski,
between June 21, 2012 and June 29, 2012, Chris Jerome traveled from Chicago to Lansing to
meet with Ferguson and Stralkowski at Ferguson Developments office three times.
71. At the first meeting between June 21, 2012 and June 29, 2012, Ferguson requested
a 5% equity stake in the Project in exchange for his assistance in securing the RFQP and then
the requisite votes for approval of the RFQP from the Lansing City Council.
72. Fergusons representation that he would provide assistance in exchange for 5%
equity was false. Ferguson intended to steal the Project from the Jeromes, while using his
misrepresentation(s) to gain access to the Jeromes pre-Project development designs, efforts,
intellectual property, business contacts, and other valuable work product to reap the benefits of the
Jeromes work and cooperation.
73. According to testimony by Mr. Ferguson in a Cook County, Illinois court hearing,
Ferguson and Kass began secretly talking to each other about doing the Project together without
the knowledge or permission of the Jeromesshortly after the Jeromes first met Ferguson in June
of 2012.
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74. At this same meeting, Ferguson also stated if his demand was not met, he would
use his political influence with the Lansing City Council to block the Project, thereby threatening
economic harm to the Plaintiffs.
75. At a second meeting between June 21, 2012 and June 29, 2012, Ferguson upped his
demand to a 10% equity stake in the Project, while again stating he would provided assistance in
exchange for the 10%.
76. Pushed by Mayor Bernero to deal with Ferguson, the Jeromes met Ferguson a third
time on June 29, 2012, when they reluctantly agreed to give Ferguson 20% equity in the Project in
exchange for his renewed offer of assistance, as long as Ferguson agreed that Chris Jerome was in
charge and Fergusons demands for increased equity would stop.
77. On June 29, 2012, the day of this third meeting, Fergusons agent and attorney,
Patrick Reid, used wire communications (email) to send paperwork for the formation of the
Capital Gateway Project, LLC, which gave Ferguson a 20% equity stake in the Project.
78. On July 18, 2012, Fergusons agent and attorney, Patrick Reid, used wire
communications (email) to send a new draft operating agreement for the Capital Gateway Project,
LLC to Chris Jerome which contained new terms that essentially gave Ferguson control of the
Project..
79. This email was part of a continuing pattern: the Jeromes would agree to give limited
ownership and management of the Project to Ferguson in response to his misrepresentations of
assistance; then Ferguson or Stralkowski (or their attorney Mr. Reid), in person or by telephone or
by email, would breach the then-current agreement by demanding more equity and otherwise
changing the terms.
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80. These feigned pledges of assistance were occurring while Ferguson was talking
secretly with Defendant Frank Kass an erstwhile joint venture partner of the Jeromes to move
the Jeromes out of the Project.
81. Each of these demands were accompanied by either an explicit or implicit threat
the Jeromes should acquiesce or risk losing the RFQP award if Ferguson used his political
influence, including the four votes on City Council, to kill the Project.
82. On or around July 19, 2012, Ferguson handed Leo Jerome a third draft operating
agreement which, inter alia, increased Fergusons demand to a 33% equity stake in the Project for
his assistance.
83. On October 25, 2012, Ferguson mailed a letter summary and another proposed new
operating agreement for Capital Gateway Project LLC by United States Postal Service to Leo and
Chris Jerome with a new demand of 50% equity for The Ferguson Family. In a startling
exposition of his political power:
a. In Section II, Ferguson boasted of Joels political expertise and claimed
Joels role was and is critical to obtaining the necessary governmental approvals
throughout the development process.
b. Ferguson described his use of inside information and his dispatch of bid
competitors: Initially, LEAP decided that the Capital Gateway proposal would be
combined with the proposal by DTN [a Lansing area developer and landlord] for
the 12 acre development. Joel immediately met with the MayorJoel Ferguson
communicated to the Mayor that a joint venture with DTN was unacceptable and
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that Capital Gateway proposal [the Jerome proposal] should be accepted as the
exclusive RFP proposal
c. Ferguson was clear about his source of power: Joel Ferguson promised that he
could deliver four (4) votes from the City Council if the Mayor could deliver three
(3) votes.
d. Ferguson detailed the Mayors acquiescence to his power: Following Joels
meeting with the Mayor, the LEAP was instructed by the Mayor to accept the
Capital Gateway RFP proposalAs a result of the Mayors directive, LEAP
announced the Capital Gateway RFP proposal had been selected
e. Ferguson then went on to describe his lobbying the City Council to approve the
Project. (Ex. 3, Oct. 25, 2012 letter and summary)
84. For added emphasis, on or around October 27, 2012, Stralkowski used wire
communications (email) to send Chris Jerome an email with the October 25 Ferguson letter as an
attachment. In the email, Stralkowski admonished Chris Jerome for his lack of respect for
Ferguson and praised Fergusons honed political skills and influence that he has earned over the
last 50 years.
85. Fergusons and Stralkowskis representations in the letter and email that Ferguson
would provide assistance in exchange for 50% equity was false. Ferguson was already secretly
talking with Kass and intended to steal the Project from the Jeromes for the benefit of Kass, Kass
entities, and Ferguson and his entities.
86. Moreover, Fergusons and Stralkowskis representations about Fergusons political
influence and that Ferguson determines who gets the Project, created a fear of economic loss in
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the Jeromes based on Fergusons and Stralkwoskis threat that the Jeromes would lose the Project
award unless they agreed to Fergusons demands.
87. Until the Jeromes received the October 2012 letter and email, the Jeromes did not
know that Ferguson was talking with Mayor Bernero about his negotiations with the Jeromes and
ordering Bernero to make the Jeromes agree to Fergusons demands.
88. On December 5, 2012, Joel Ferguson used wire communications (email) to send an
email from his AOL account to Leo Jeromes GMAIL account with a memorandum addressed to
Chris and Leo Jerome that was dated December 4, 2012. This memorandum attacked a November
counteroffer by Chris Jerome, while proposing a new operating agreement for Capital Gateway
Project LLC with the 50% equity demand repeated.
89. The memorandum carbon-copied Mayor Bernero and LEAP CEO Bob Trezise with
the clear message that if the Jeromes did not accept this offer, then the Mayor and his economic
development agents would take the Project award away from the Jeromes and cause the Jeromes
economic harm.
90. Bernero immediately reacted to Fergusons memorandum: Bernero held a meeting
the following dayDecember 6, 2012at Lansing City Hall with Chris and Leo Jerome, Joel
Ferguson, Christopher Stralkowski, LEAP CEO Bob Trezise, and Berneros Chief of Staff Randy
Hannan to discuss Fergusons memorandum. At this meeting:
a. Bernero pushed the Jeromes to give into Fergusons demands;
b. Ferguson stated They [the Jeromes] didnt sign them [earlier documents] fast
enough and as a result the price just goes up;
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c. Ferguson stated that the Project existed only because of his control of the City
Council and if his demands are not met, the Project will die.
91. On December 11, 2012, the written threat became even more explicit when
Fergusons agent and attorney, Patrick Reid, used wire communications (email) to send an email
from Reids AOL email account to LEAP CEO Trezise at his LEAP email, with carbon copies to
Leo Jerome at his AOL account, Chris Jerome at his GMAIL account, and Chuck Clark at his
corporate account with an attached letter from Ferguson to Mayor Bernero that Joel Ferguson
sent by mail that same day (December 11, 2012) to Mayor Bernero with the subject line Re:
Capital Gateway Project, LLC. (Ex. 4.)
92. In this letterconcerning private negotiations between the Jeromes and Ferguson
about the structuring of a private companyFerguson complained to Mayor Bernero that the
Jeromes most recent compromise offer was not acceptable because it included a number of
egregious provisions.
93. On the second page of the letter, Ferguson stated his services are worth 50% of the
Project and I also believe you would recommend settling somewhere between 33% and 50%,
which would give me approximately 41% ownership interest. (emphasis added).
94. Fergusons letter then proposed a new split: I am proposing to accept 32% so long
as Christopher Jerome and Leo Jerome accept 64% and have the remaining 4% membership issued
to Chuck Clark. (emphasis added).
95. Fergusons proposal contained this unusual voting component: all voting on
major issues should be based upon me [Ferguson] having 50% of the vote and the Jerome [sic]
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having 50%. In the event there is any deadlock, then such matter will be presented to Chuck Clark,
who can break the deadlock by voting his 4% interest.
96. Ferguson closed this December 11, 2012 letter to Mayor Bernero by proposing the
Mayor revoke the August 13, 2012 RFQP award if the Jeromes do not accept this compromise and
then thanked the Mayor for your time and efforts in working toward a settlement in this matter.
(emphasis added). (Ex. 4.)
97. This December 11, 2012 letter is the most clear and direct example of Fergusons
use of the mail and wire communications to improperly influence, threaten, and extort financial
benefits under the threat of economic harmdeciding who gets the Project award.
98. On December 20, 2012, the Jeromes met with Mayor Bernero, Deputy Chief of
Staff Randy Hannan, and LEAPs Bob Trezise at the Mayors request. Here, Mayor Bernero
continued to push the Jeromes to accept an agreement with Ferguson.
99. On January 2, 2013, Chris Jerome traveled to Lansing from Illinois to meet with
Trezise at LEAPs offices in response to a telephone call from a member of Trezises staff. At this
meeting:
a. Trezise revealed that Ferguson had threatened to derail the Mayors
reelection campaign by accusing the Mayor of being a racist if the Mayor did
not meet Fergusons Capital Gateway Project demands.
b. Trezise told Jerome that the racism claim would cripple the Mayor
politically even if it did not remove him from office.
c. Trezise told Jerome that Ferguson had had control over Lansing politics for
years and told Jerome a story about a time when Ferguson had boasted that
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taxpayer money was flowing from MSU into the pockets of Lansing City
Council members.
100. On January 10, 2013, Christopher Stralkowski followed up on Fergusons
December threats in an email to Chris Jeromes GMAIL account:
a. Stralkowski wrote, when you ignore the Mayor, remember he insisted on actual
negotiation over these Critical Agreement issues, your actions, or lack thereof,
reflect no respect for the process, no respect for the Mayor, and no respect for
Joel (emphasis added)
b. Further, [s]ince you and Leo have been indifferent to Joels numerous offers,
he has taken his compromise off the table
c. And then Stralkowski threatened no one but the Mayor himself has control of
the Red Cedar property and this potential development Project. Everything is still
just pretty pictures and words on a piece of paper. If we cannot somehow find a way
to agree on a fair Operating Agreement, the Mayor said he will walk away from
the deal (emphasis added). (Ex. 5, Jan. 10, 2013 email from Stralkowski to
Chris Jerome.)
101. Five days after Stralkowskis proverbial stick email threatening Chris Jerome, on
January 15, 2013, Stralkowski sent an email with a carrot to demonstrate the benefit of
cooperating with the Ferguson Enterprise and an additional stick for not working with the
Ferguson Enterprise:
a. The carrot: Because of Fergusons negotiating skills, Ferguson, Chuck
Clark and the Drain Commissioner, Pat Lindeman, and the City had reached an
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agreement that would potentially save millions in construction costs by having
the Drain Commissioner build the foundations for the Red Cedar Renaissance
Project.
b. The stickcompromise or else: Most importantly, the Mayor told Joel he
needs an agreement from us in place by February 1st or he will act to modify the
RFQPNot an ideal outcome to say the least. (Ex. 6, Jan. 15, 2013 email from
Stralkowski to Chris Jerome) (emphasis added).
102. Accordingly, at this point in time, Ferguson and Stralkowski, operating the
Enterprise through Ferguson Development, committed (at a minimum) the following fraud and
extortion predicate acts:
FRAUD EXTORTION
Fraud No. 1: 54, 6/18/12 meeting at Extortion No. 1: 74, 1st meeting between
Fergusons office: Ferguson misrepresents that 6/21 and 6/29/2012 at Fergusons office:
he will help the Jeromes for free. This meeting Ferguson threatens to block the Project unless
was either set up or confirmed via phone call he gets 5% equity in the Project.
(wires) or mail.
Extortion No. 2: 88, 12/5/2012, Joel
Fraud No. 2: 71, 1st meeting between 6/21 Ferguson uses wire communications (email) to
and 6/29/2012 at Fergusons office: Ferguson send an email with a memorandum dated
misrepresents that he will help the Jeromes for December 4, 2012 to the Jeromes. This
5% equity in the Project. Because Chris memorandum attacked a November
Jerome lived in Chicago, this meeting and the counteroffer by Chris Jerome, while proposing
subsequent meetings between the Jeromes and a new operating agreement for Capital
Ferguson/Stralkowski were set up either by Gateway Project LLC with the 50% equity
wire communicationa phone call from Mr. demand repeated. The memorandum carbon-
Fergusons assistant or an email or phone call copied Mayor Bernero and LEAP CEO Bob
from Mr. Stralkowski (who lives in Lansing) Trezise with the clear message that if the
to Chris Jerome. Jeromes did not accept this offer, then the
Mayor and his economic development agents
nd
Fraud No. 3: 74, 2 meeting between 6/21 would take the Project award away from the
and 6/29/2012 at Fergusons office: Ferguson Jeromes and cause the Jeromes economic harm
misrepresents that he will help the Jeromes for
10% equity in the Project.
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Extortion No. 3: 90, 12/6/2012 meeting at

Fraud No. 4: 76, 6/29/2012 meeting at City Hall to discuss Ferguson
Fergusons office: Ferguson misrepresents that memorandum, with Chris and Leo Jerome,
he will help for 20% equity in the Project. Joel Ferguson, Christopher Stralkowski,
LEAP CEO Bob Trezise, and Berneros Chief
Fraud No. 5: 77, 6/29/2012 wire of Staff Randy Hannan, where Ferguson
communication (email from Ferguson agent repeats the threat to block the Project unless he
and attorney Patrick Reid: confirming receives 50% equity in the Project.
Fergusons misrepresentation that Ferguson
will help the Jeromes for 20% equity in the Extortion No. 4: 91-96, 12/11/12,
Project. Fergusons agent and attorney Patrick Reid
used wire communications to send an email
Fraud No. 6: 78, 7/18/2012, Fergusons with an attached letter from Ferguson, where
agent and attorney, Patrick Reid, used wire Ferguson proposes a new equity split with a
communications (email) to send a new draft tie-breaking vote to Chuck Clark, and
operating agreement for the Capital Gateway threatens to block the Project if his demands
Project, LLC to Chris Jerome which are not met.
contained terms with changed voting rights
that essentially gave Ferguson control of the Extortion No. 6: 99, 1/2/2013, On January
Project, while having Ferguson remain as a 2, 2013, at a meeting with Robert Trezise at
minority stakeholder. Mr. Reid continued the LEAP Lansing offices, Trezise reveals to
misrepresentation that Ferguson would help Chris Jerome that Ferguson has been
the Jeromes. threatening Berneros political career unless
Bernero met Fergusons demands with respect
Fraud No. 7: 82, 7/19/2012, Ferguson to the Project. This conversation, together
handed Leo Jerome a proposed operating with Fergusons prior representations of his
agreement, through which Ferguson political power, control of the Lansing City
misrepresents that he will help the Jeromes for Council, and relationship with Mayor
33% equity in the Project. Bernero, and demands threatened economic
harm (loss of the RFQP award) to the
Fraud No. 8: 83, 10/25/2012, Ferguson Jeromes, unless they agreed to the latest
mailed a letter summary and another operating Ferguson offer.
agreement to the Jeromes, and misrepresents
that he will help the Jeromes for 50% equity in Extortion No. 7: 100, 1/10/13, Stralkowski
the Project. uses wire communications to send an email
threatening the Jeromes with loss of the Project
Fraud No. 9: 84, 10/27/2012, Stralkowski award if Jeromes do not agree to Fergusons
used wire communications (email) to send the terms.
10/25 letter summary and operating agreement
by email, and misrepresents that he and Extortion No. 8: 101, 1/15/2013,
Ferguson will help the Jeromes for 50% equity Stralkowski uses wire communications to send
in the Project. another email threatening Jeromes with loss of
the Project award if the Jeromes do not agree
to Fergusons terms.
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Fraud No. 10: 88, 12/5/2015, Joel Ferguson

uses wire communications (email) to send an
email with a memorandum dated December 4,
2012 to the Jeromes. This memorandum
attacked a November counteroffer by Chris
Jerome, while proposing a new operating
agreement for Capital Gateway Project LLC
with the 50% equity demand repeated. The
memorandum carbon-copied Mayor Bernero
and LEAP CEO Bob Trezise with the clear
message that if the Jeromes did not accept this
offer, then the Mayor and his economic
development agents would take the Project
award away from the Jeromes and cause the
Jeromes economic harm.
Fraud No. 11: 91-96, 12/11/12, Fergusons

agent and attorney Patrick Reid used wire
communications to send an email with an
attached letter from Ferguson, where Ferguson
proposes a new equity split with a tie-breaking
vote to Chuck Clark, and threatens to block the
Project if his demands are not met.
103. To summarize, up to this point, there were at least 11 separate fraudulent acts by
Ferguson and Stralkowski, violating 18 U.S.C. 1341 and 1343. In addition to the predicate acts
based on fraud, there were at least 8 separate instances where Ferguson threatened loss of the
Project unless the Jeromes agreed to his demands, committing extortion and bribery in violation
of 18 U.S.C. 1951 and Mich. Comp. Laws 750.213 and 750.117.
104. This pattern of racketeering continued, with a series of misrepresentations and
threats that ultimately deprived the Jeromes of their property interest in the Project.
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The Racketeering Enterprise continues with a series of meetings to cut to the Jeromes out of the
Project, interfere with their business relationships and efforts, and ultimately steal the Project.
105. Soon after the RFQP award on August 13, 2012, LEAP CEO Bob Trezise started
weekly meetings involving Chris Jerome, the Mayors Office, and other public entities at LEAPs
offices in Lansing to coordinate the private-public interface of the Red Cedar Renaissance Project.
Tresize forced Chris Jerome to meet with LEAP partners (other than Ferguson and Stralkowski)
as if they were Jeromes partners including Chuck Clark and Hobbs + Clark architects. Tresize
excluded other potential national partners that the Jeromes wanted to work with.
106. In the fall of 2012, the LEAP-sponsored meetings were canceled and Ferguson
began holding his own weekly meeting with Drain Commissioner Lindemann, Chuck Clark, LEAP
CEO Trezise, and others at his office starting in November of 2012without the knowledge or
consent of Chris Jerome, the RFQP authorized agent.
107. On March 6, 2013, Mayor Bernero met with Chris Jerome. Bernero called
Ferguson our version of Kwame Kilpatrick and tried to force Chris Jerome to agree with
Fergusons latest demand of 50% equity.
108. Bernero also told Jerome that Ferguson and Chuck Clark had recently sat in his
office and demanded that Mayor Bernero give the Project to them outright and cut the Jeromes out
completely.
109. On March 7, 2013, Trezise informed Chris Jerome that Ferguson was increasing
the political pressure on Mayor Bernero to force the Jeromes to capitulate to Fergusons demands,
or alternatively, cut the Jeromes out of the Project.
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110. At a March 26, 2013 meeting, Mayor Bernero pressured Chris Jerome again by
stating Ferguson would use his control of the Lansing City Council to derail the Project unless the
Jeromes agreed to Fergusons demand.
111. On or about June 11, 2013, Chris and Leo Jerome talked with Mayor Bernero in
front of Lansing City Hall. During this conversation Mayor Bernero told the Jeromes that Bernero
and Trezise had been secretly talking with Chris Jeromes Boston-based investment group,
including Carpenter & Company, without approval from Chris Jerome, the Projects authorized
agent.
112. At a subsequent meeting at Lansing City Hall on August 9, 2013, Mayor Bernero
told Chris Jerome that Ferguson and Ferguson Development had been secretly working to cut the
Jeromes out of the Capital Gateway Project. Bernero stated Frank Kass and Continental were
Fergusons partners in that effort.
113. On September 9, 2013, Ferguson sent his son, David Ferguson, to hand-deliver a
proposed Memorandum of Understanding (MOU) that demanded Leo Jerome sign the MOU.
The MOU purported to dissolve the Capital Gateway Project partnership between Jeromes and
Ferguson Development; provided for the sale of the Jerome family properties at below market
value to the partnership between Ferguson and Frank Kass; and provided David Ferguson with a
commission.
114. Four days later, on September 13, 2013, LEAP CEO Trezise telephoned Leo
Jerome and instructed Jerome to pick up a document that was waiting for Jerome at Fergusons
office and come to a meeting at Lansing City Hall.
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a. At Fergusons office, Leo Jerome picked up an operating agreement for a
new entity named Ferguson/Continental Lansing, LLC, with an attached one-
page proposal entitled Jerome Proposal. Neither of the Jeromes were aware
of the new entity from by Ferguson and Kass until Leo Jerome received the
operating agreement.
b. The operating agreement purported it was a joint venture between
Continentalthe Jeromes former joint venture partnerand Red Cedar
Investor, LLC. Ferguson was identified as the Managing Member of Red Cedar
Investor, LLC with a 51% equity stake in the Ferguson/Continental Lansing,
LLC. Continental owned the other 49% equity stake in Ferguson/Continental
Lansing, LLC. The Ferguson/Continental Lansing, LLC operating agreement
had been executed three months earlier on June 28, 2013.
c. The attached one-page proposal offered Leo Jerome an opportunity to
participate in the Ferguson/Continental Lansing LLC and develop the Red
Cedar Renaissance Projecteven though the Jeromes were already awarded the
RFQP and Chris Jerome was the authorized agent for the selected Developer.
d. The one-page proposal offered Leo Jerome only 1/3 equity in
Ferguson/Continental Lansing LLC (with Ferguson and Continental each
possessing 1/3), but only if the Jerome family sold their Sawyer Pontiac
property on Michigan Avenue for $3,500,000which was 50% under the fair
market value of the Sawyer Pontiac property.
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115. After Leo Jerome arrived at City Hall for the September 13, 2013 meeting, Mayor
Bernero told Leo Jerome to accept this prorposal or the Mayor would take away the RFQP award
from the Jeromes.
116. Later that same day, on September 13, 2013, LEAP CEO Trezise interfered with
the Jerome business relationships and expectancies with Jeromes partners by calling
representatives of Carpenter & Company in Massachusetts. Trezise told the Carpenter
representative that that Jeromes status in the Project was uncertain and that Carpenters
participation was no longer desired.
117. On December 2, 2013, Karl Dorshimer, the COO of LEAP, emailed Chris Jerome
and told Chris Jerome that the RFQP had been taken away from him by LEAP and the City of
Lansing.
118. On December 12, 2013, without rebidding the Red Cedar Renaissance Project, and
in violation of Chapter 206 of the Lansing City Ordinance, Purchasing, Contracts, and Sales,
Mayor Bernero and Trezise held a surprise press conference and awarded the Red Cedar
Renaissance Project to the Ferguson/Continental Lansing, LLCnewly formed entity controlled
by Joel Ferguson and Frank Kasseven though Ferguson/Continental had never bid for the RFQP.
119. Less than three weeks later, shortly before January 1, 2014, Mayor Bernero and
Ferguson traveled to Pasadena, California to watch MSUs football team participate in the Rose
Bowl.
120. Lansing City Councilman Jody Washington stated that Ferguson said he paid for
Mayor Berneros Rose Bowl trip. This act followed a pattern of Ferguson giving tickets to various
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Lansing government officials, such as Lansing City Council member Dennis Quinney, and
including Mayor Berneros friends and city-appointees like then City Attorney Janene McIntyre.2
Defendants extortion tactics continue with respect to the Jerome familys parcels.
121. On March 14, 2014, a representative of Developer A, a national developer with
experience in multi-family, luxury, market rate, senior, and student housing developments who
was interested in partnering with the Jeromes to develop a $90 million stand-alone Project using
one of the two Jerome parcels, met with LEAP CEO Bob Trezise and LEAP COO Steven
Willobee.
122. At this meeting, Mr. Willobee, told the Developer A representative it was probably
best if the Jeromes were not involved as it would risk the company receiving approvals for the
Project. When questioned by a representative of Developer A, LEAP COO Willobee stated
further the City would not look positively on our proposal if the Jerome family was involved.
123. As a result of LEAPs and Trezises threats and the interference by Ferguson and
Mayor Bernero, the Jeromes lost out on a second development opportunity a Project in excess
of $90 millionand were ultimately forced to sell their 3.3 acre Story Olds property at a reduced
price of $7.05 million to Developer A.
124. On May 7, 2015, LEAP CEO Trezise told the Developer A representatives that
Mayor Bernero wanted them to meet with Joel Ferguson regarding Developer As development
Project on the Jerome familys Story Olds property.
125. On May 14, 2015, Developer A representatives met with Mayor Bernero, LEAP
CEO Trezise, and Ferguson at an office on the campus of MSU. At this meeting, Ferguson
2
http://lansingcitypulse.com/article-14091-Red-Cedar-kerfuffle.html
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attemptedunder the auspices of his connections with Bernero and LEAPto solicit confidential
information and intimidate this potential competitor.
126. Ferguson demanded to know the details of Developer As Project.
127. Ferguson told the Developer A representatives that he had managed to convince
MSU to assist in financing a large portion of the Red Cedar Renaissance with a master lease
arrangement. This MSU-Ferguson arrangement, if true, would hurt the competitiveness of
Developer As Project.
128. Ferguson also told the Developer A representatives that MSU was acting as a joint
venture partner with Sparrow Health for one portion of the Red Cedar Renaissance Project and
with Ferguson for residential housing. This arrangement, if true, would hurt the competitiveness
of Developer As Project.
129. In late May 2015, Ferguson and Stralkowski repeatedly called and emailed the
Developer A representatives. In increasingly hostile terms, they demanded confidential
information from the Developer A representatives about its intended Project on the Jerome
familys parcel. Developer A never provided any information to Ferguson, Stralkowski, or
Ferguson Development.
130. On or around June 5, 2015, a Developer A representative met with Kelly Rossman
of Truscott Rossman, a Lansing public relations firm, to discuss hiring that firm for public relations
related to the Jerome familys parcel.
131. Ms. Rossmana LEAP board memberpressured the Developer A representative
to call and meet with Mr. Ferguson.
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132. As a result, the Developer A representative met with Ferguson later that date.
Ferguson told the Developer A representative that the Developer A Project was dead unless two
things happened:
a. Developer A pay Ferguson $147,000;
b. Developer A persuade Chris Jerome to dismiss a lawsuit Chris Jerome
had filed against Ferguson, Ferguson Development, Kass, and Continental
in Cook County, Illinois.
133. Due to the constant interference, Developer A withdrew from the proposed
joint project with the Jeromes.
134. On November 11, 2015, Mayor Bernero signed a development agreement with
Ferguson/Continental Lansing LLC to develop the Red Cedar Golf Course.
135. As part of that agreement, the City of Lansing agreed to directly pay up to $38
million in infrastructure costs for this private development headed by Joel Ferguson.
136. On January 2, 2016confirming an email Stralkowski sent Chris Jerome 3 years
earlier on January 15, 2013 that Ferguson, Chuck Clark and the Drain Commissioner, Pat
Lindeman, and the City had reached an agreement that would potentially save millions in
construction costs by having the Drain Commissioner build foundations for the Red Cedar
Renaissance Project,Drain Commissioner Lindemann filed a permit with the Michigan
Department of Environmental Quality to begin work on a $35 million public project t0 keep water
run-off from flowing through the closed Red Cedar Golf Course.
137. This drain construction will save Joel Ferguson, Frank Kass, and their companies
millions of dollars in extra costs to develop the Red Cedar Renaissance Project.
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138. Having received the commitment of up to $38 million public dollars from the City
of Lansing, the Ferguson EnterpriseJoel Ferguson, Christopher Stralkowski, Ferguson
Development is now working with Mayor Bernero, LEAP CEO Trezise, Chuck Clark, Frank
Kass, and Drain Commissioner Lindeman to convince the Ingham County Board of
Commissioners (which includes representatives from communities other than Lansing) to agree to
bond an additional $35 million in public dollars (beyond Lindemanns January commitment) to
fully raise over $70 million public dollars to assist in financing this private development.
Frank Kasss and Continentals tortious interference with the Jeromes business relationship
and expectancy with Ferguson and business expectancy in keeping the awarded RFQP.
139. In 2011, Kass and Continental met with Chris Jerome to discuss a joint venture or
partnership to work as a general developer on the Project and to develop inter alia student housing.
140. As part of the initial joint venture agreement with Kasss companies, Chris Jerome
insisted on a Confidentiality & Non-Compete Agreement to protect the intellectual property of
the Project with Hallmark Campus Communities (Hallmark), one of Continentals family of
related companies that is Continentals student housing development arm.
141. Hallmark Continental executed the Agreement on or about January 17, 2012. Kass
subsequently characterized their agreement as one large joint venture between a Continental
Hallmark entity and the Jerome Family. (Ex. 1.)
142. The Agreement provided inter alia that all confidential information would be kept
confidential by Hallmark and its Representatives. Representatives were defined in the
Agreement as Hallmarks directors, officers, employees, agents or advisers (legal, financial or
otherwise), potential financiers or any other representative.
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143. The Agreement further provided that the confidential information disclosed to
Hallmark would remain the property of Jerome and could not be copied, reproduced, or disclosed
in any manner with anyone other than Hallmark Representatives without the express written
permission of Jerome.
144. In reliance on the Agreement, Chris Jerome shared confidential information with
Kass and Continental (and Hallmark)information that cost Chris Jerome hundreds of thousands
of dollars to develop.
145. According to testimony by Mr. Ferguson in a Cook County, Illinois court hearing,
Ferguson and Kass began talking to each otherwithout the knowledge or permission of the
Jeromesshortly after the Jeromes met Ferguson in June of 2012.
146. On or around June 29, 2012, Kass told Chris Jerome by telephone that Kass and
Continental Hallmark were ending their joint venture with the Jeromes.
147. The secret discussions between Kass and Ferguson severed the joint venture
between Kass, Continental, Continental-Hallmark, and the Jeromes, and thus destroyed the
business expectancies of the Jeromes regarding the Project and the RFQP.
148. Ferguson and Kass reached their own agreement regarding the Red Cedar
Renaissance Project by October of 2012. This agreement was memorialized with the operating
agreement signed on June 28, 2013.
149. Neither Kass nor Ferguson shared the existence of their agreement with the
Jeromes. Chris Jerome did not receive any information about this possible agreement until told by
Mayor Bernero on August 9, 2013. Neither Chris nor Leo Jerome had any actual proof of this
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secret agreement until Mayor Bernero and Mr. Tresize showed Leo Jerome the document
regarding the Ferguson/Kass entity.
150. From June of 2012 to the fall of 2013, Ferguson feigned cooperation with Jerome
on the Capital Gateway Project, yet over the next year, Ferguson and Kass hammered out details
of their own operating agreement for the Ferguson/Continental Lansing, LLC, which was finally
executed on June 28, 2013.
151. The plans that were submitted to the City of Lansing by Ferguson/Continental
Lansing, LLCs which led to their illegal no-bid award of the Red Cedar Renaissance Project award
in December of 2013 largely appropriating in form and substance the proprietary plans and
specifications originally developed by the Jeromes and shared with Kass, Continental, and
Hallmark in reliance on the Confidentiality Agreement.
COUNT I VIOLATION OF THE RACKETEERING INFLUENCED AND CORRUPT

ORGANIZATION ACT, 18 U.S.C. 1962(c)
(DEFENDANTS FERGUSON, STRALKOWSKI, AND FERGUSON DEVELOPMENT.)
152. Plaintiffs re-allege and incorporate the above allegations in this Complaint, as if
fully set forth in this paragraph.
153. This Count is against Ferguson, Stralkowski, and Ferguson Development, (the
Count I Defendants).
154. Together, the Count I Defendants are associated in fact and constitute an
enterprise as defined under 18 U.S.C. 1961(4).
155. Defendants Ferguson and Stralkowski are persons employed by or associated with
Ferguson Development to commit racketeering acts that deprived Plaintiffs of their RFQP award
and the economic opportunity associated with the Project.
Page 34 of 47
156. Ferguson has authority to and did in fact directly or indirectly control, conduct,
participate, manage or operate the affairs of Ferguson Development through a pattern of
racketeering activity.
157. Stralkowski has authority to and did in fact directly or indirectly control, conduct,
participate, manage or operate the affairs of Ferguson Development through a pattern of
racketeering activity.
158. Pursuant to and in furtherance of their racketeering scheme, the Count I Defendants
committed multiple related acts of fraud and fraudulent misrepresentations involving multiple
violations of 18 U.S.C. 1341 mail fraud and 18 U.S.C. 1343 wire fraud between June of 2012
and September 13, 2013 to hide and keep concealed Count I Defendants plans with defendants
Kass, Continental, Red Cedar Investor LLC, and Ferguson/Continental Lansing, LLC, to
appropriate and steal Plaintiffs property including inter alia, the Project RFQP award to the
Plaintiffs, architectural renderings and other proprietary intellectual property costing hundreds of
thousands of dollars, and tens of millions of dollars in value and expected profits related to
developing the Project. These instances of fraud, perpetuated through means that include the mail
and wire transmissions are set forth specifically in paragraphs 54-56 and 71-97, and the Chart
attached as Exhibit 7.
159. Additionally and in the alternative, pursuant to and in furtherance of their
extortionate and bribe-infused racketeering scheme, the Count I Defendants also committed
multiple related acts of extortion and other illegal acts in violation of the Hobbs Act, 18 U.S.C.
1951 and Michigan Compiled Laws 750.213 and 750.117 between October of 2012 and September
13, 2013. In committing these racketeering acts, the Count I Defendants worked with their co-
Page 35 of 47
conspirators to appropriate and steal Plaintiffs property including inter alia, architectural
renderings and other proprietary intellectual property costing hundreds of thousands of dollars, the
Project RFQP award with the value of tens of millions of dollars in value related to developing
the Red Cedar Renaissance Project. These specific instances of extortion and bribes in violation
of the Hobbs Act and Michigan law are alleged specifically in paragraphs 98-115, and in the Chart
attached as Exhibit 7.
160. The Count I Defendants knew or had reason to know that the use of mail and wire
communications was necessary to effectuate their fraud.
161. The Count I Defendants acts constitute a pattern of racketeering because the acts
are related in that they had the same method, purpose, participants, and victims, and they continued
over a more than 2 year period.
162. Moreover, the Count I Defendants racketeering activities did not stop with their
acquisition of Plaintiffs RFQP award and interest in the Project. The Count I Defendants
continued to interfere with Plaintiffs business interests by using their extortionate tactics to
tortiously interfere with the Plaintiffs new development partner, Developer A. The Count I
Defendants are currently using their political influence to persuade Ingham County and the Drain
Commissioner to approve $35 million in public dollars to build foundations for this private
development.
163. As a direct and proximate result of the Count I Defendants racketeering activities
and violations of 18 U.S.C. 1962(c), Plaintiffs have been injured in their business and property
in that they lost the award of the Project and all expected attendant profits, as well as hundreds of
thousands of dollars in costs expended to develop the Project, and the loss of intellectual property.
Page 36 of 47
164. While not parties, the City of Lansing, its taxpayers, and the Michigan State
University have additionally suffered damages from this racketeering enterprise.
165. Additionally, the Count I Defendants racketeering activities and violations of 18
U.S.C. 1962(c) have interfered with Plaintiffs business dealings with Developer A and directly
and proximately caused damage to Plaintiffs business expectancies with Developer A related to
the sale and development of Plaintiffs property.
WHEREFORE, Plaintiffs respectfully request that this Honorable Court enter judgment in
their favor and against the Count I Defendants, as follows:
(i) For compensatory damages in an amount to be proven at trial in excess of

$75,000.00;
(ii) Treble damages;
(iii) Attorneys fees; and
(iv) For such other relief as the Court deems just and proper.
COUNT II CONSPIRACY TO VIOLATE THE RACKETEERING INFLUENCED AND

CORRUPT ORGANIZATION ACT, 18 U.S.C. 1962(d)
(DEFENDANTS BERNERO, TREZISE, LEAP, FERGUSON, STRALKOWSKI,
FERGUSON DEVELOPMENT, CHUCK CLARK, CLARK CONSTRUCTION, RED
CEDAR INVESTOR LLC, AND FERGUSON/CONTINENTAL LANSING LLC.)
167. This Count is against Defendants Bernero, Trezise, LEAP, Ferguson, Stralkowski,
Ferguson Development, Chuck Clark, Clark Construction, Red Cedar Investor LLC, and
Ferguson/Continental Lansing, LLC (the Count II Defendants.)
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168. As set forth above, and more specifically in the Chart attached as Exhibit 7, the
Count II Defendants intentionally agreed and conspired to violate 18 U.S.C. 1962(c).
Specifically, the Count II Defendants have intentionally conspired to conduct and participate in
the conduct of the affairs of the enterprise through a pattern of racketeering activity 1962(c).
169. The Count II Defendants agreed to Ferguson and/or Stralkowski making fraudulent
representations to the Plaintiffs regarding Fergusons intentions and Plaintiffs status as the
selected Developer on the Project. These fraudulent representations, designed to induce
Plaintiffs to surrender valuable confidential development information, were made through or with
the assistance of interstate mails and wires (email, telephone, postal service).
170. Additionally and alternatively, the Count II Defendants also intentionally agreed
and conspired to engage in bribery and extortion, in violation of both federal and state law, to
create a political system in Lansing where Plaintiffs were forced to surrender equity and use
preferred contractors in exchange for political approvals.
171. For example, the Count II Defendants agreed to pressure the Plaintiffs into
surrendering equity in the Project and using certain specified contractors, under the threat of using
their political power and connections to take the Project away from the Plaintiffs. The Count II
Defendants benefitted from their conspiracy financially and/or politically.
172. The Count II Defendants knew that Fergusons and Stralkowskis predicate acts
were part of a pattern of racketeering activity and agreed to the commission of those acts to further
the schemes described above. That conduct constitutes a conspiracy to violate 18 U.S.C 1962(c),
in violation of 18 U.S.C. 1962(d).
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173. As direct and proximate result of the Count II Defendants conspiracy, their
agreement, and violations of 18 U.S.C. 1962(c), Plaintiffs have been injured in their business
and property in that they lost their award of the Project and all expected attendant profits as well
as hundreds of thousands of dollars in costs and the loss of intellectual property. Additionally, the
Count II Defendants racketeering activities and conspiracy to violate 18 U.S.C. 1962(c) have
interfered with Plaintiffs business dealings with Developer A and directly and proximately caused
damage to Plaintiffs business expectancies with Developer A related to the sale and development
of Plaintiffs property.
174. The Count II Defendants actions, alleged above, and set forth in detail in Exhibit
7, show the Count II Defendants agreed to facilitate the operation of the Enterprise through a
pattern of racketeering.
175. Additionally, and in the alternative, the above allegations show that the Count II
Defendants agreed that Ferguson, Stralkowski, and/or the Enterprise would commit at least two
predicate acts of mail fraud, wire fraud, extortion, and bribery.
their favor and against the Count II Defendants, as follows:
(i) For compensatory damages in an amount to be proven at trial in excess of

$75,000.00;
(ii) Treble damages;
(iii) Attorneys fees; and
(iv) For such other relief as the Court deems just and proper.
Page 39 of 47
COUNT III VIOLATION OF PLAINTIFFS FOURTEENTH AMENDMENT RIGHT

TO NOT BE DEPRIVED OF PROPERTY WITHOUT DUE PROCESS OF THE LAW
PURSUANT TO 42 U.S.C. 1983
(DEFENDANTS BERNERO, TREZISE, AND LEAP)
177. This Count is pled against Defendants Bernero, Trezise, and LEAP, (Count III
Defendants) who at all pertinent times were acting under the color of state law to deprive Plaintiffs
of their rights under the Fourteenth Amendment of the United States Constitution, specifically of
Plaintiffs right to not be deprived of property without due process of the law.
178. Bernero acted in his capacity and role as Mayor of Lansing under the color of state
law.
179. Trezise and LEAP acted as agents of the City of Lansing and under color of state
law.
180. Plaintiffs submitted a bid in response to the RFQP issued by the City of Lansing
and LEAP.
181. Plaintiffs were selected as the selected Developer and Chris Jerome as the
authorized agent in response to Plaintiffs submission and bid for the RFQP.
182. As the selected Developer, Plaintiffs are entitled to, inter alia, the following
property rights pursuant to the RFQP:
183. The selected developer will enter into a planning and negotiation process with the
LEDC [LEAP] and City [of Lansing] that should ultimately result in a Comprehensive
Development Agreement. (Ex. 2, at 1.)
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184. The developer selected to purchase the Property (the Developer) will work with
the Public Entities to develop the Property. (Id., at 7.)
185. The proposed Developer is to be the sole representative and point of contact with
regard to development, site purchase, construction, condominium and lease related matters and
any cost or expense charges. (Id., at 10.)
186. Plaintiffs reasonably relied on their selection in response to the RFQP, and their
property rights as the selected Developer that Plaintiffs as [t]he selected developer will enter into
a planning and negotiation process with the LEDC and City that should ultimately result in a
Comprehensive Development Agreement. (emphasis added). Included in the award of the RFQP,
the City guaranteed that Plaintiff Chris Jerome would be the sole authorized agent who has
unqualified authority to negotiate with the City of Lansing and its agent LEAP. In reliance on
the selection, Plaintiffs invested time and money to proceed toward development of this valuable
property.
187. Plaintiffs had a property interest in these rights and promises related to their
selection as the selected Developerfor example, Plaintiffs selection had a direct effect on
Plaintiffs ability to obtain financing for the Project, to borrow money, to issue debt, and to
otherwise do business.
188. However, after Plaintiffs rejected Joel Fergusons repeated and escalating demands
for equity in and control of the Project, the Count III Defendants agreed and conspired to rescind
the Plaintiffs selected Developer status and to award the Project instead to Joel Ferguson and his
companies.
Page 41 of 47
189. Without a hearing or rebid, Bernero, Trezise, and LEAP worked together to rescind
Plaintiffs selection as selected Developer, and to instead award the Project, on a no-bid basis to
Joel Fergusons company, Ferguson/Continental Lansing, LLC.
190. Additionally, in re-awarding the Project on a no-bid basis, the Count III Defendants
violated Chapter 206 of the Lansing City Ordinances, Purchasing, Contracts, and Sales.
191. Specifically, the Count III Defendants acted under the color of law to rescind the
Project award from Plaintiffs, and to deprive Plaintiffs of their selected Developer status and
attendant property rights without any notice, let alone any due process of the law.
192. In early 2013, Trezise informed Chris Jerome of Joel Fergusons threats; for
example, to derail the Mayor Berneros reelection campaign by accusing him of being a racist if
the Mayor did not meet Fergusons demands with regard to the Capital Gateway Project. Trezise
also told Chris Jerome that the racism claim would cripple Bernero politically even if it did not
remove him from office.
193. On January 10, 2013, Stralkowski emailed Chris Jerome and threatened to take Joel
Fergusons latest set of demands (styled as a compromise) off the table and indicated that
Defendant Mayor Bernero will terminate the Project if Joel Fergusons demands were not met.
194. During meetings in March of 2013, Trezise and Mayor Bernero continued to
represent that Joel Ferguson was putting political pressure on Mayor Bernero through Joel
Fergusons control of the Lansing City Council, and that Joel Ferguson was prepared to terminate
the Project through his control of the Lansing City Council if Plaintiffs did not agree to Joel
Fergusons demands for equity and control.
Page 42 of 47
195. On December 2, 2013, Chris Jerome received an email from Karl Dorshimer of
LEAP, informing him that Plaintiffs have been relieved of their award of the Project by LEAP and
the City of Lansing.
196. On December 12, 2013, instead of rebidding the Red Cedar Golf Course
development Project as Mayor Bernero had promised Chris Jerome and the Lansing taxpayers,
Mayor Bernero and Trezise awarded the Red Cedar Golf Course development Project to the
Ferguson/Continental Lansing, LLC. Thus, Defendant Joel Ferguson obtained Plaintiffs property
interest as the new selected Developer.
197. Plaintiffs have a right under the Fourteenth Amendment to the United States
Constitution to not be deprived of property without the due process of the law.
198. Defendants Bernero, Trezise, and LEAP by their unlawful acts and acting under the
color of law, deprived Plaintiffs of their property right as the selected Developer under the RFQP
and related property rights in violation of Plaintiffs rights not to be deprived of property without
due process under the United States Constitution.
their favor and against the Count III Defendants for the following:
a. For compensatory damages in an amount to be proven at trial in excess of

$75,000.00;
b. For reasonable costs and attorneys fees pursuant to 42 U.S.C. 1988;
c. For such other relief as the Court deems just and proper.
Page 43 of 47
COUNT IV TORTIOUS INTERFERENCE WITH BUSINESS EXPECTANCY THE

PROJECT
(DEFENDANTS KASS, CONTINENTIAL, AND HALLMARK)
200. This Count is pled against Defendants Kass, Continental, and Hallmark (the Count
IV Defendants.)
201. Plaintiffs had a business relationship and expectancy with Joel Ferguson for the
Project. This relationship and expectancy manifested itself thorough the various offers and
operating agreements circulated to Plaintiffs by Joel Ferguson, demanding increased equity and
increased control over the Project.
202. Bernero, Trezise, and Ferguson represented to Plaintiffs that Plaintiffs needed
Fergusons involvement and support to obtain the necessary political approvals for the Project.
Additionally, Plaintiffs attended numerous meetings regarding the Project with both Ferguson and
officials like Bernero and Trezise in the same room.
203. Following their win of the RFQP and their selection as the selected Developer,
Plaintiffs also had a business expectation and property rights associated with their selection, such
as the right to be the sole Project representative and negotiate with the City of Lansing for a
Comprehensive Development Agreement.
204. The Count IV Defendants had knowledge of the Project and Plaintiffs rights and
expectancy related to the Plaintiffs initial negotiations with Ferguson, as well as the Plaintiffs
rights and expectancy related to Plaintiffs selection as the selected Developer pursuant to the
RFQP. Indeed, Plaintiffs had previously engaged Kass and Continental as potential partners for
Page 44 of 47
the Project, but Kass told Chris Jerome in June or July 2012 that he was no longer interested in the
Project due to Fergusons involvement.
205. As part of the potential partnership, Plaintiff Story Companies and Hallmark
executed a Confidentiality and Non-Compete Agreement on or about January 17, 2012.
206. However, Defendants Kass, Continental, and Hallmark intentionally, willfully, and
without justification interfered with Plaintiffs rights and business expectancies by inter alia: (1)
secretly meeting and talking with Joel Ferguson after Ferguson and Plaintiffs had already met and
agreed to work together on the Project, with the intent to divert Fergusons efforts for Kasss and
Continentals own gain; (2) misappropriating and stealing the plans and depictions of the Capital
Gateway Project for their own use; and (3) otherwise misrepresenting to the Plaintiffs that Kass
and Continental were no longer interested in the Project, while Kass and Continental were actually
actively working to divert Fergusons influence for their own financial benefit, and to the detriment
of the Plaintiffs.
207. As a result of the Count IV Defendants actions, Plaintiffs lost not only their
business relationship and expectancy with Ferguson, but also their business expectancy related to
being named selected Developer and winning bidder for the Project. Plaintiffs have suffered, as
a consequence, damages in excess of $75,000.00.
their favor and against the Count IV Defendants for the following:

$75,000.00;
b. For such other relief as the Court deems just and proper.
Page 45 of 47
COUNT V TORTIOUS INTERFERENCE WITH BUSINESS EXPECTANCY

DEVELOPER A (DEFENDANTS TREZISE, LEAP, AND FERGUSON)
209. This Count is pled against Defendants Trezise, LEAP, and Ferguson (the Count V
Defendants.)
210. Plaintiffs had a business relationship and expectancy with Developer A for the sale
and development of property owned by the Jeromes, specifically a $70 plus million development,
independent of the Project. The Jeromes obtained this business relationship and expectancy
following the Defendants actions to deprive Plaintiffs of their rights as selected Developer for
the Project and to otherwise interfere with Plaintiffs business interests, as described throughout
this Complaint.
211. The Count V Defendants had knowledge of the business expectancy and
relationship with Developer A because, at a minimum, Developer A representatives met with
Trezise in 2014 and Ferguson in 2015.
212. The Count V Defendants intentionally, willfully, and without justification
interfered with Plaintiffs rights and business expectancies by inter alia: (1) telling Developer A
that the Jeromes should not be involved in the Project, or otherwise the Project would not receive
the necessary governmental approvals; (2) directing Developer A representatives to meet with Joel
Ferguson, and then solicit confidential information and intimidate Developer A to give up its status
as a potential competitor; (3) using Fergusons position and influence at MSU to threaten
Developer A and making extortionate demands from Developer A, including to make a cash
payment to Ferguson, and to force Chris Jerome to drop a related lawsuit in Cook County, Illinois.
Page 46 of 47
213. As a result of the Count V Defendants actions, Plaintiffs have lost their business
relationship and expectancy to develop their parcels with Developer A and have thereby lost their
expected profits from the business relationship and expectancy.
WHEREFORE, Plaintiffs respectfully request that this Honorable Court enter judgment in their
favor and against the Count V Defendants for the following:

$75,000.00;
b. For such other relief as the Court deems just and proper.
****PLAINTIFFS DEMAND A TRIAL BY JURY****
Dated: March 9, 2017 Respectfully submitted,
THE MIKE COX LAW FIRM PLLC
s/ Michael A. Cox (P43039)

Michael A. Cox (P43039)
Danila V. Artaev (P74495)
Attorneys for Plaintiffs
17430 Laurel Park Drive North, Suite 120E,
Livonia, MI 48152
(734) 591-4002
mc@mikecoxlaw.com
dartaev@mikecoxlaw.com
Page 47 of 47
Case 1:16-cv-01116-JTN-ESC ECF No. 62-1 filed 03/09/17 PageID.298 Page 1 of 2

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Case 1:16-cv-01116-JTN-ESC ECF No. 62 filed 03/09/17 PageID.

UNITED STATES DISTRICT COURT

CHRISTOPHER JEROME, an individual,

v. Case No.: 1:16-cv-01116

FIRST AMENDED COMPLAINT

Defendants state as follows:

1. Plaintiff, Christopher Chris Jerome resides in Chicago, Illinois and is a citizen of

the State of Illinois.

4. Defendant, Joel Ferguson, is a principal and member of Ferguson Development

University Board of Trustees and its former Chairman.

6. Defendant, Lansing Economic Area Partnership, LEAP, is an Internal Revenue

7. Defendant, Robert Bob L. Trezise (Trezise), is the Chief Executive Officer of

LEAP. Trezise is a citizen of the State of Michigan.

8. Defendant, Clark Construction Services, LLC, (Clark Construction), is a

and civil construction general contracting firm.

9. Defendant, Charles Chuck Clark (Clark), is a principal of Clark Construction.

Clark is a citizen of the State of Michigan.

10. Defendant, Frank Kass (Kass), is a principal of Continental Development, Inc.

Kass is a citizen of the State of Ohio.

11. Defendant, Continental Development, Inc., (Continental), is an Ohio corporation,

with its principal place of business in Ohio.

12. Defendant, Hallmark Campus Communities (Hallmark), is an Ohio partnership,

with its principal place of business in Ohio.

13. Defendant, Ferguson Development, LLC (Ferguson Development), is a

Street, Lansing, MI 48906.

14. Defendant Christopher Stralkowski (Stralkowski) is the Executive Project

is Joel Fergusons son-in-law.

15. Defendant Ferguson/Continental Lansing, LLC, is a Delaware limited liability

Investor, LLC, and Continental Development are members of Ferguson/Continental Lansing,

Cedar Investor, LLC.

17. None of the Defendants are entitled to governmental immunity.

JURISDICTION AND VENUE

jurisdiction over this matter pursuant to 18 U.S.C. 1964(a).

has jurisdiction under 42 U.S.C. 1983 and 1988.

22. This Court has personal jurisdiction over all Defendants.

Overview of the case.

enterprise (Ferguson Enterprise or Enterprise) with his son-in-law, Christopher Stralkowski

the City of Lansing.

serving as Fergusons campaign manager.

27. Ferguson Development was formed as a limited liability company in 1998.

webpage (although it was deleted after this lawsuit was filed).

communications, prohibited by 18 U.S.C. 1343, and/or through extortion and bribery, in

Robert Trezise awarded the Project on a no-bid basis to Ferguson/Continental, LLC.

surrendedered increasing equity stakes in the Project.

Robert Trezise of LEAP, to influence them to do Fergusons bidding.

control, Ferguson made good on his and Stralkowskis threats.

company, Continental in violation of Lansing contracting ordinances.

the Project from the Plaintiffs.

contacting and threatening Developer As representatives. As a result, the Jeromes suffered

The Beginnings of the Project.

the vacant parcels of land into a large, mixed use development.

in interstate commerce as developers, investors, and financiers of multi-million-dollar

Kass re Joint Venture.)

Ferguson because he controlled a majority of the City Council members votes.

decade-long chairmanship of the Michigan State University of Trustees, where he controlled

for his private gain.

51. The RFQP stated in relevant part as follows:

contracts with the Lansing Economic Area PartnershipLEAPto provide LEAPs

Consequently, Mayor Bernero controls both the LEDC and LEAP.

meeting using wire communications or the telephone. At this meeting:

a. Ferguson told the Jeromes he would help free of charge because it

was the right thing for Lansing.

of a majority of the Lansing City Council to support the Project.