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Lallier, father-in-law restricted from selling or divesting dealership by judge

Fayetteville Observer - 2/2/2017

Feb. 02--Fayetteville car dealer Mike Lallier has been trying to sell his home and his dealership since being charged in September with molesting a 15-year-old boy, lawyers for a fired employee argued Wednesday in Cumberland County Superior Court.

The lawyers, Walter Tippett and Michael Porter, contend that Lallier aims to divest or sell his assets to keep the fired employee from collecting hundreds of thousands of dollars he seeks in a wrongful-termination lawsuit filed Friday.

After lengthy and sometimes contentious court arguments, visiting Judge Beecher R. Gray issued a temporary restraining order barring Lallier and his father-in-law, Gene Reed, from divesting or selling assets valued at more than $10,000, other than those used in the normal course of business.

Reed is the majority owner of Reed-Lallier Chevrolet. Lallier, 63, owns 49 percent of the Raeford Road dealership and serves as its president.

Lallier, former chairman of the Fayetteville Public Works Commission, was charged Sept. 3 in Darlington County, South Carolina, with criminal sexual conduct with a minor, which is punishable by up to 15 years in prison.

Gray, a Superior Court judge from Durham County, also granted a motion filed by Tippett and Porter to expedite discovery proceedings, which will include documents and depositions from Lallier and Reed.

Gray agreed to allow a motion from Lallier and Reed to seek arbitration with the fired employee, which could lead to an out-of-court settlement. Hearings on the motions are scheduled for Feb. 27.

The temporary restraining order is related to the lawsuit filed by the fired employee, who alleges that Lallier engaged in sexual misconduct with at least seven male Reed-Lallier Chevrolet employees over the years and that he paid some of them to keep quiet. The lawsuit says one man was paid $450,000 and another $100,000 for their confidentiality.

The lawsuit was filed under the name John Doe. The Fayetteville Observer knows the identity of the plaintiff but is not naming him because to do so could reveal the identity of the boy Lallier is accused of molesting. The plaintiff's name has not been used in court.

His complaint details a history of allegations against Lallier in an attempt to show a pattern of sexual and criminal misconduct, including an account of a federal drug trafficking conviction in the 1970s.

The lawsuit seeks more than $25,000 from Reed and Lallier on each of 10 claims for relief, including wrongful termination, abuse of process, obstruction of justice, unfair and deceptive trade practices and civil conspiracy. It also seeks damages.

Lawyers for the fired employee want to ensure that he won't be left holding "an empty bag."

Porter argued Wednesday that Chris Doherty was negotiating to buy Reed-Lallier Chevrolet last week. Doherty owns car dealerships in North Carolina and Florida, as well as Fort Bragg Harley-Davidson on Sycamore Dairy Road in Fayetteville. Doherty could not be reached for comment.

"There is no sale imminent," responded Wiggins, a lawyer for Reed.

Tippett also said Lallier may be trying to sell his home, a gated property on Willow Bend Road that is valued for tax purposes at nearly $1.5 million.

Tippett said Lallier has already sold off some of his assets.

"We know it's already happened," he said. "We want to prevent it from happening any more."

Lallier and Reed could be in jeopardy of losing Reed-Lallier Chevrolet if they don't sell it.

Porter said he has a taped audio recording of a high-ranking General Motors executive saying that Reed and Lallier have been put on notice that they violated the automaker's franchise agreement and could lose the dealership.

A clause in General Motors' franchise agreements says a dealer who is convicted of a felony could lose the dealership. An official with General Motors did not respond to an email asking whether the franchise could be revoked.

Susie Gibbons, a Raleigh corporate lawyer representing Lallier, called the allegation that Lallier and Reed could lose the franchise "completely false."

Lawyers on both sides accused each other of "gamesmanship."

At one point, Porter described Lallier as "a serial predator."

Lallier's lawyer, Gerald Beaver, objected to the remark and accused Porter of grandstanding to the press. Gray sustained the objection.

Wiggins accused Tippett and Porter of waiting to the final minute Friday to file the wrongful-termination lawsuit. Wiggins said he didn't know the lawsuit was even coming until he read about it in the newspaper Saturday.

Porter objected to his client being served notice of the motion for arbitration while he was in Highland Country Club on Tuesday evening.

Lawyers for Lallier and Reed told Gray that the temporary restraining order should be thrown out, partly because no one had been served with the paperwork.

According to his lawsuit, the fired employee was among those who turned Lallier in to law enforcement in Darlington County.

The lawsuit says that while in jail, Lallier directed the man to stop cooperating with authorities and promised that he would soon be able to return to work.

Instead, the man was put on administrative leave and then fired with no warning on Dec. 29, court documents show. Lallier and Reed then sued the former employee in an effort to force him into confidential arbitration.

The lawsuit was dropped after the fired employee subpoenaed Lallier, Reed and General Motors to testify at the next scheduled hearing on the matter.

About the same time, a separate and related arbitration hearing involving Lallier was being heard in Cumberland County Superior Court.

Included in that case was an exhibit that says lawyers for four boys were in discussions with one of Lallier's lawyers on Sept. 6 and 7, the first two days after Lallier's arrest.

The document is a Sept. 7 letter from Porter that is titled "confidential settlement communication."

Porter wrote that he and lawyer Reed Noble were representing the four boys and two men "in regards to the conduct/activities of your client that we discussed with you yesterday."

One of the men identified in the letter is the employee who was fired.

Alluding to the arbitration hearing, Richard Wiggins -- Reed's lawyer -- said some of the people involved "have been paid and paid well."

Their identities and the amounts they may have been paid have not been publicly revealed because a visiting judge who heard the case ordered it sealed.

The fired employee was not among those getting paid, documents show.

The temporary restraining order approved Wednesday stipulates that Reed, who lives in Florida, will come to Cumberland County to be deposed.

On Feb. 27, another visiting judge is expected to hear the fired employee's motion for a preliminary injunction and a motion to compel him into arbitration.

Staff writer Greg Barnes can be reached at barnesg@fayobserver.com or 486-3525.

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