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Friday, June 14, 2024 | Back issues
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Baby Furniture Exec Loses Massive Fraud Case

CHICAGO (CN) - The former president of children's furniture store USA Baby cannot pursue widespread fraud claims, a federal judge ruled.

Scott Wallis acted as president of USA Baby from 2005 to 2009, a year after its nearly six dozen locations went under.

Although USA Baby declared bankruptcy in 2008 and went into foreclosure, Wallis, who owned 5 percent equity in the company, insisted that the company was profitable and that numerous people engaged in a conspiracy to loot the franchise.

In a pro se federal complaint, Wallis sued 190 defendants, seeking $500 million in damages, on 40 counts of conspiracy, racketeering and civil rights violations.

U.S. District Judge Joan Gottschall dismissed the complaint in its entirety last week, finding reasons to reject every count Wallis put forward in his complaint.

"The complaint fails to distinguish between claims brought on behalf of USA Baby and those brought by Wallis as an individual," she wrote. "The court acknowledges that there is some uncertainty as to whether the bankruptcy court could order USA Baby's assets to be abandoned to Wallis. ... The court need not grapple with these questions for purposes of the motions to dismiss, however, as each count of the amended complaint fails for additional reasons."

A number of claims Wallis filed against Cook County judges and clerks involved in th bankruptcy proceedings of USA Baby failed because "judges cannot be sued for acts performed in their judicial capacity," according to the ruling.

Wallis' claims against the law firms behind the bankruptcy were also "too conclusory to state a claim, as the fraudulent statements are not pleaded with particularity, and there are no facts in the complaint that would support an inference that the defendants were part of a conspiracy to control USA Baby's assets," Gottschall found.

Wallis, now a pastor at All Nations Worship Center, self-published "Secret Corruption," a 2012 digital book detailing his experiences with the legal system.

His biography on Amazon says: "Pastor Wallis was thrust into the world of litigation through an alleged corrupt enterprise scheme to bankrupt USA Baby, Inc., which was accomplished in 2008. Then, he was catapulted into the position of being forced to represent himself when lawyers for said enterprise used the legal system to accomplish their scheme (To date, none of the alleged parties have been indicted for their numerous alleged criminal activities). USA Baby, Inc. was liquidated, even though profitable. It was then that his understanding of the reality of secret corruption in the legal system set in, as back room deals and back channel communication were exposed." (Parentheses in original.)

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