BoS Defendants Plead Not Guilty

31 July 2006

Former BETonSPORTS (BoS) CEO David Carruthers and seven others pleaded not guilty today to charges of racketeering, conspiracy and fraud in a federal courtroom in St. Louis, Mo., while in a separate hearing, a temporary restraining order against the company was extended to Aug. 14.

Former BoS employees Lori Beth Kaplan Multz, 45, Neil Scott Kaplan, 40, and Tim Brown, 32, as well as William Hernan Lenis, 53, William Luis Lenis, 26, Manny Gustavo Lenis, 27, and Monica Lenis (owners and operators of Mobile Promotions Inc., Direct Mail Expertise Inc. and DME Global Marketing and Fulfillment), entered not guilty pleas either in person or through their attorneys before U.S. Magistrate Judge Mary Ann Medler.

Monica Lenis, who is nine months pregnant, was excused from appearing in court.

Carruthers' arraignment, meanwhile, was postponed until later in the day because he was delayed in travel.

In the matter of U.S. v Mobile Promotions Inc., Direct Mail Expertise Inc. and DME Global Marketing and Fulfillment, a lawyer for DME stated that no representatives of Mobile Promotions Inc. or Direct Mail Expertise Inc. are likely to appear because the companies are no longer viable. He was asked to get a statement from the boards of the two defunct companies designating him as their representative, and he entered a plea of not guilty on the companies' behalf in the meantime.

Lawyers for BoS, however, did not to show up to enter a plea. Federal prosecutors said the company had been properly served when it arrested Carruthers on July 16 and charged him with conspiracy, fraud and racketeering in connection with taking illegal bets from the United States.

Carruthers, 48, arrived for his arraignment Monday afternoon, escorted into the courtroom in handcuffs and shackles, wearing standard issue white T-shirt and khaki pants.

His Dallas-based attorney, Tim Evans, entered a plea of not guilty.

Evans and the prosecuting attorney, Assistant U.S. Attorney Michael Fagan, told Judge Medler that they had discussed a possible solution regarding Carruthers' detention and bond. Evans requested Carruthers' bond be set at $1 million on the conditions that he would live as a U.S. resident in the St. Louis area at a residence approved by pre-trial services under GPS surveillance (bracelet or anklet).

Medler said she would take the motion under advisement, provided the lawyers can tie up the loose ends, such as getting Carruthers an ID for Immigration and Naturalization purposes.

In the meantime, Carruthers will remain in custody in St. Louis.

All of the defendants, including Carruthers, are scheduled to appear on Aug. 21 for an evidentiary hearing, which will determine what evidence is to be admitted, and what else must be done before a case can proceed. Medler told each attorney, however, that it is most likely an unrealistic date, and they are free to request a continuation.

In another courtroom, the temporary restraining order against BoS, originally issued July 17 and extended on Friday, was again extended, this time until Aug. 14, by U.S. District Judge Carol Jackson.

BoS again showed no representation in the hearing.

Trial Attorney Marty Woelfle of the Department of Justice's Organized Crime and Racketeering Section said that BoS feels they have not been properly served, but the U.S. disagrees.

Woelfle asserted that the United States first served the company when they arrested Carruthers, though it was unforeseen that he would be fired. They further sent a copy of the order to BoS offices in both London and Costa Rica.

BoS had retained New York attorney Stephen Cohen to advise the company on appearing in court, and Woelfle said the United States sent him a copy of the order, but he refused to accept it on the grounds that he wasn't representing BoS in this matter.

"According to Cohen," Woelfle said. "BETonSPORTS has decided not to appear in the civil or criminal cases."

Prosecutors said they plan to ask for a default judgment on the matter.

Jackson ruled that the United States had presented good cause for an extension and extended the temporary restraining order for another two weeks.

She said the time would be used to determine whether another hearing should be held or if the government needs to effect service of the order in another way.

Emily Swoboda is the senior staff writer at IGamingNews. She lives in St. Louis, Mo.