2003 - August 18th - 23 PM 1:18:23 PM Pacific Daylight Time – Email from Todd Porter to Laura Dewey regarding falsification of income by Craig Franklin.

From:  Todd Porter, California Bar No. 148993

To:       Laura Dewey, California Bar No. 108294

   

 “Dear Laura:

The email follows our conversation regarding some ideas I've developed to flush out the great likelihood that Craig has hidden his money, committed a fraud on the court, and otherwise done everything in his power to thwart Melinda's right of support.

In handling the trial for Melinda, you obtained for her an interest in certain stock options, which were the security for a "nonrecourse" loan with GHS.  The terms of the deal are unimportant for this conversation, other that to say, I refer to these stock options as the OLD options.

Subsequent to the divorce, I was suing Craig and GHS.  I deposed both Mr. O'Dowd, and Craig.  What I learned is illuminating.

At the time of O'Dowd's deposition, he and Craig were negotiating a deal for additional stock options, which I will refer to as the NEW options.  This, in and of itself is a form of undisclosed income.  However, putting that issue aside, they had gotten as far as a range for these NEW options between 400,00 and 650,000.  [Note, I have sent to Melinda a copy of this deposition, I have a certified copy here in the office as well.]

I also learned from Mr. O'Dowd the following important things.  First, his compensation agreement has never been reduced to writing.  The way it works is that Craig first has to submit a "commission report" to Dan, which Dan then approved (or disapproves) and he is paid.  Two things are to be learned from this.  The first is what Melinda has told us for forever, is that Craig has control over when he receives his income, but virtue of the fact (there may in fact be other ways) that it is HE who must first submit the report to Dan to be paid.  Second, the terms of his compensation agreement can be discerned from the reports.  Third, I learned that there was a precedent for Craig to divert income to exercise the stock option.  This fact actually happened with respect to the OLD options, and Dan detailed that occurrence in his deposition.

So, Craig lowered Melinda's support, by making a claim (false) that his earning were down.  What I'd suspect that you will find, is that A.  A deal was in fact consummated for NEW stock options.  B.  Craig may have intentionally delayed submission of commission reports and/or C.  Craig had income applied towards the exercise of the stock options, which was not disclosed to the court.

This is in keeping with Craig's character, his course of conduct, his opportunity, and is consistent with his BIG year the next year.  Also, his claim of lower income is inconsistent with GHS financial results, which they publish on their web site, showing earnings growth in EVERY year.  See. www.ghs.com

So, my advice, would be to subpoena directly from GHS all of his stock options agreements, all evidence of any payment to exercise any options (OLD or NEW), all commission reports, and you will find, I'd bet, he's screwed Melinda, and committed a fraud of the court.  I'd seek the most severe sanctions possible, and make this a part of an effort to extend support.

Happy Hunting,

Todd”