ROUNDTREE AUTOMOTIVE GROUP
`
`IN THE DISTRICT COURT OF
`
`CAUSE NO. DC-19-09051
`
`FILED
`11/13/2020 4:39 PM
`FELICIA PITRE
`DISTRICT CLERK
`DALLAS CO., TEXAS
`Terri Kilgore DEPUTY
`
`LLC,
`
`v.
`
`Plaintiff,
`
`MATTHEW STINSON, NSOH
`
`HOLIDAY ROAD, LLC, and NSOH
`
`HOLIDAY ROAD 11, LLC.,
`
`Defendants,
`
`MATTHEW STIN SON, N SOH.,
`
`HOLIDAY ROAD, LLC, and N SOH
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`HOLIDAY ROAD II, LLC,
`
`Third- Party Plaintiffs,
`
`V.
`
`FRANK STINSON,
`
`macaw:ammcmcmcmmwowocmcmcmwawowocmcmcmwammcmcm
`
`DALLAS COUNTY, TEXAS
`
`Third Party Defendant.
`
`192ND JUDICIAL DISTIRCT
`
`DEFENDANTS’ ORIGINAL COUNTERCLAIM AND THIRD-PARTY PETITION
`
`Matthew Stinson, NSOH Holiday Road, LLC, and NSOH Holiday Road II, LLC
`
`(collectively, the “MS-NSOH Parties”) file this Original Counterclaim against Plaintiff, Roundtree
`
`Automotive Group LLC and their Third-Party Petition against Frank Stinson.
`
`INTRODUCTION
`
`1.
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`This lawsuit was wrongfully filed by Plaintiff Roundtree Automotive Group LLC
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`(“Roundtree”) at the instance of Frank Stinson. There is no merit to Roundtree’s claims. Matthew
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`Stinson is owed money by Roundtree, which has wrongfully interfered with the use and enjoyment
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`of property owned by the MS-NSOH Parties. It is time to set the record straight and end the abuse
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`DEFENDANTS’ ORIGINAL COUNTERCLAIM AND THIRD-PARTY PETITION
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`Page 1
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`of civil process by Roundtree and Frank Stinson.
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`PARTIES
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`2.
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`Roundtree is a Louisiana limited liability company that initiated this lawsuit and
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`thus consented to jurisdiction in this court.
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`3.
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`Frank Stinson is the founder, President, and owner of the majority of Class A
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`membership interests in Roundtree. Frank Stinson maintains a residence at 437 N. Andalusia Ave,
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`Santa Rosa Beach, FL, 32459, where he may be served with process.
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`4.
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`Matthew Stinson owns the remaining Class A membership interests in Roundtree
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`and served as its Chief Executive Officer during much of the relevant time period.
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`5.
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`NSOH Holiday Road LLC and NSOH Holiday Road II LLC are Texas limited
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`liability companies formed by Matthew Stinson and his wife to acquire and hold certain real
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`property in Texas.
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`JURISDICTION AND VENUE
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`6.
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`This Court has jurisdiction over the parties as each is a Texas citizen, maintains a
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`principal place of business or residence in Texas, or has voluntarily submitted to the Court’s
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`jurisdiction. This Court further has jurisdiction over the parties because each has done business in
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`Texas and/or has had sufficient minimum or continuing contacts with Texas.
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`7.
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`Pursuant to Texas Civil Procedure and Remedies Code §15.002(a)(l), venue is
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`proper in this district because Dallas County is the county in which all or a substantial part of the
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`events or omissions giving rise to the claims alleged herein occurred.
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`RULE 47 STATEMENT
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`8.
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`Pursuant to Texas Rule of Civil Procedure 47, the MS—NSOH Parties seek monetary
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`relief over $1,000,000.00 and nonmonetary relief described below.
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`DEFENDANTS’ ORIGINAL COUNTERCLAIM AND THIRD-PARTY PETITION
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`Page 2
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`BACKGROUND
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`9.
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`Matthew Stinson worked for Roundtree for more than 20 years, including serving
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`as its Chief Operating Officer and later as its Chief Executive Officer. During his employment
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`with Roundtree, Matthew Stinson — acting in the interest of the company —— repeatedly deferred
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`payment of bonuses owed to him by Roundtree. Matthew Stinson also personally guaranteed and
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`provided consent to enable entities in which he held an ownership interest to pledge assets to secure
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`loans taken out by Roundtree to support the business, including a line of credit from World Omni
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`Bank of $15 million.
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`In these and many other ways, Matthew Stinson supported the business of
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`Roundtree and put his own assets at risk for the benefit of the company.
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`10.
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`Contrary to the allegations in Roundtree’s First Amended Petition and Request for
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`Declaratory Judgment (the “Roundtree Petition”), Roundtree’s founder Frank Stinson did not leave
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`the business between 2012 and 2018. In fact, Frank Stinson was involved in important Roundtree
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`business meetings throughout the years at issue in the Roundtree Petition.
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`It was only following
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`the collapse of the business in 2019 that Frank Stinson fabricated a narrative to pin the blame on
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`Matthew Stinson, as a salve to Frank Stinson’s ego.
`
`1 1.
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`Not only was Frank Stinson involved in the business of Roundtree on a continuous
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`basis, as a member (i.e., owner) of Roundtree, he received periodic reports regarding the amounts
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`that each member of the Stinson family had received from Roundtree. Frank Stinson discussed
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`Matthew Stinson’s “AR balance” with him and with Roundtree’s Chief Financial Officer on
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`multiple occasions. No demand for repayment of any amounts received by Matthew Stinson was
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`ever made by Frank Stinson — who controlled and continues to control Roundtree — or anyone
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`acting on behalf of Roundtree. As a result, not only is the Roundtree Petition false in suggesting
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`that Frank Stinson only discovered the amounts that Matthew Stinson had received after an
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`DEFENDANTS’ ORIGINAL COUNTERCLAIM AND THIRD-PARTY PETITION
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`“investigation and review of Roundtree’s files and financial documents,” in 2018, but Frank
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`Stinson failed to object to any of those distributions at the time he learned of them. Moreover, the
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`Roundtree Petition fails to account for any of the monies owed to Matthew Stinson by Roundtree
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`— amounts that exceed Roundtree’s trumped—up claims.
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`12.
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`The transactions made the subject of the Roundtree Petition were all: permissible
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`under the Second Amended and Restated Limited Liability Company Agreement of Roundtree
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`(the “2013 Operating Agreement”); similar to transactions between Roundtree and Frank Stinson
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`and other members of the Stinson family; and properly documented and reflected in the company’s
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`records.
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`13.
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`Matthew Stinson has not had an active role in the management of Roundtree since
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`January 2019. Since that time, Frank Stinson has abused his position as majority owner to cause
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`the wrongful filing of the Roundtree Petition; to cause Roundtree to file lis pendens against
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`properties owned by the MS—NSOH Parties and Matthew Stinson’s personal residence and to
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`maintain the lis pendens without any claim of right in the properties; to refuse Matthew Stinson
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`his rights of inspection under the 2013 Operating Agreement; and to deny Matthew Stinson’s
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`requests for indemnification and advancement under the 2013 Operating Agreement for legal fees
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`Matthew Stinson has incurred and is incurring in defending this action and responding to legal
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`process in other actions related to his service as an officer of Roundtree
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`COUNTERCLAIMS
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`COUNT I — FRAUDULENT CLAIM AGAINST REAL PROPERTY
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`14.
`
`The MS-NSOH Parties re-allege and incorporate by reference all facts and
`
`allegations set forth above.
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`15.
`
`Roundtree made and used a document (a) with knowledge that the document is a
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`DEFENDANTS’ ORIGINAL COUNTERCLAIM AND THIRD-PARTY PETITION
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`fraudulent claim against real property or an interest in real property or (b) with the intent that the
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`document be given the same legal effect as a court record evidencing a valid claim against real
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`property.
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`16.
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`Roundtree acted with intent to cause the MS—NSOH Parties to suffer financial
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`injury and to cause Matthew Stinson to suffer mental anguish or emotional distress.
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`17.
`
`The MS-NSOH Parties have been damaged by Roundtree’s action.
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`18.
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`Pursuant to Tex. Civ. Prac. & Rem. Code §12.001 et. seq., Roundtree is liable to
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`the MS-NSOH Parties for the greater of $10,000.00 or the actual damages caused by the violation;
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`court costs; reasonable attorney’s fees; and exemplary damages in an amount determined by the
`
`court.
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`COUNT II-BREACH OF CONTRACT: MONIES OWED TO MATTHEW STINSON
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`19.
`
`Matthew Stinson re-alleges and incorporates by reference all facts and allegations
`
`set forth above.
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`20.
`
`Matthew Stinson performed services for Roundtree for which Roundtree agreed to
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`pay him a bonus based on Roundtree’s annual profits.
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`21.
`
`Roundtree has failed to pay the required bonuses to Matthew Stinson, which total
`
`more than $1,000,000.00.
`
`22.
`
`Matthew Stinson has been damaged by Roundtree’s failure to honor its contractual
`
`obligations to pay him a bonus for his services to Roundtree.
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`COUNT III - ACCOUNTING
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`23.
`
`Matthew Stinson re-alleges and incorporates by reference all facts and allegations
`
`set forth above.
`
`24.
`
`Matthew Stinson owns 490 units of the Class A membership interests in Roundtree.
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`DEFENDANTS’ ORIGINAL COUNTERCLAIM AND THIRD-PARTY PETITION
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`25.
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`In light of the allegations of the Roundtree Petition and the fact that many
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`distributions were made by Roundtree to members of the Stinson family (regardless whether they
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`directly owned membership interests in Roundtree or worked for Roundtree), Matthew Stinson
`
`requests a formal accounting of Roundtree’s affairs. Circumstances render it just and reasonable
`
`that Roundtree should account for all distributions made to members, any contributions made by
`
`each member to Roundtree, and any other transactions that affect the value of each member’s
`
`interests.
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`COUNT IV — BREACH OF CONTRACT: INSPECTION RIGHTS
`
`26.
`
`Matthew Stinson re-alleges and incorporates by reference all facts and allegations
`
`set forth above.
`
`27.
`
`By letter dated August 29, 2020, Matthew Stinson requested to inspect the books
`
`and records of Roundtree. This right is available to him as a member of Roundtree under
`
`applicable state law and Section 11.4 of the 2013 Operating Agreement, which states: “The books
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`and records shall at all times be maintained at the principal executive office of the Company and
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`shall be open to the reasonable inspection and examination of the Members or their duly authorized
`
`representatives during reasonable business hours.”
`
`28.
`
`By letter dated September 8, 2020, Roundtree — through counsel — notified Matthew
`
`Stinson that it was refusing to grant his right of inspection.
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`COUNT V — BREACH OF CONTRACT: INDEMNIFICATION & ADVANCEMENT
`
`29.
`
`Matthew Stinson re-alleges and incorporates by reference all facts and allegations
`
`set forth above.
`
`30.
`
`By letter dated August 29, 2020, Matthew Stinson requested that Roundtree
`
`indemnify him against loss in connection with the Roundtree Petition and a third-party subpoena
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`DEFENDANTS’ ORIGINAL COUNTERCLAIM AND THIRD-PARTY PETITION
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`served upon him by Ally Bank, a long—time lender to Roundtree.
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`31.
`
`The 2013 Operating Agreement provides in Section 11.2 “Indemnification of
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`Members and Officers:
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`Any Person made a party to any administrative, civil or criminal action, suit or
`proceedings by reason of the fact that such Person is or was a Member or Officer,
`shall be indemnified by the Company against the reasonable expenses, including,
`without limitation, attorneys’ fees, fines, penalties and amounts paid in satisfaction
`of judgment or in settlement, actually and reasonably incurred by such Person in
`connection with, or resulting from the defense of, such administrative, civil or
`criminal action, suit or proceeding, or in connection with or resulting from any
`appeal therein, if such Person acted in good faith and in a manner such Person
`reasonably believed to be in or not opposed to the best interests of the Company,
`and with respect to any criminal action or proceeding, had no reasonable cause to
`believe the conduct was unlawful.
`
`32.
`
`By letter dated September 8, 2020, Roundtree — through counsel — notified Matthew
`
`Stinson that it was refusing to indemnify him or advance his legal fees, in violation of the terms of
`
`the 2013 Operating Agreement.
`
`33.
`
`Matthew Stinson has been damaged and continues to be damaged by Roundtree’s
`
`refusal to indemnify him and advance his legal fees and expenses.
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`DEFENDANTS’ ORIGINAL COUNTERCLAIM AND THIRD-PARTY PETITION
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`Page 7
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`THIRD PARTY PETITION
`
`COUNT I — CONTRIBUTION AND INDEMNITY
`
`34.
`
`The MS-NSOH Parties re-allege and incorporate by reference all facts and
`
`allegations set forth above.
`
`35.
`
`Frank Stinson is the majority owner of the Class A membership interests in
`
`Roundtree. Under the terms of the 2013 Operating Agreement, Frank Stinson controls all aspects
`
`of the operation of Roundtree.
`
`36.
`
`Throughout the period at issue in the Roundtree Petition, Frank Stinson participated
`
`in the business affairs of Roundtree and monitored the accounts of Roundtree as they pertained to
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`distributions, loans, and other payments to members of the Stinson family. Throughout the period
`
`at issue in the Roundtree Petition — and for years beforehand — Frank Stinson had distributed funds
`
`of Roundtree to himself, his wife, and other family members for various personal expenses,
`
`vacations, and luxuries, including hi gh—end jewelry.
`
`37.
`
`If the MS—NSOH Parties are found liable to Roundtree for any of the matters alleged
`
`in the Roundtree Petition, then they are entitled to contribution and indemnification from Frank
`
`Stinson, who was in a position to safeguard the assets of Roundtree and either knowingly approved
`
`the distributions at issue or failed to object or take other action to protect Roundtree from the
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`alleged conduct of Matthew Stinson, which was in fact no different from Frank Stinson’s own.
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`COUNT TWO — BREACH OF FIDUCIARY DUTY
`
`38.
`
`Matthew Stinson re-alleges and incorporates by reference all facts and allegations
`
`set forth above.
`
`39.
`
`Frank Stinson abused his position as majority owner to cause Roundtree to file a
`
`baseless lawsuit against Matthew Stinson, file improper lis pendens on properties owned directly
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`DEFENDANTS’ ORIGINAL COUNTERCLAIM AND THIRD-PARTY PETITION
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`Page 8
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`or indirectly by Matthew Stinson, and deny Matthew Stinson his rights as a member of Roundtree
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`to inspect the books and records and be afforded indemnification and advancement in lawsuits
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`related to his tenure as an officer and member of Roundtree.
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`40.
`
`In these regards, Frank Stinson has breached his fiduciary duties to Matthew
`
`Stinson as a minority member of Roundtree and caused damage to Matthew Stinson.
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`41 .
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`Frank Stinson has acted with malice toward Matthew Stinson and the intent to cause
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`harm and loss to Matthew Stinson, for which actions Matthew Stinson seeks exemplary damages.
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`CONDITIONS PRECEDENT
`
`42.
`
`All conditions precedent to the MS-NSOH Parties’ recovery have occurred or have
`
`been performed.
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`ATTORNEY’S FEES
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`43.
`
`The MS-NSOH Parties re-allege and incorporate by reference all facts and
`
`allegations set for the above.
`
`44.
`
`The MS-NSOH Parties have been forced to retain counsel to defend the Roundtree
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`Petition and to enforce their rights in this litigation. The MS-NSOH Parties pray that they recover
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`all attorney’s fees they have incurred herein as permitted by law.
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`RULE 194 DISCLOSURE REQUEST
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`Pursuant to Rule 194, the MS-NSOH Parties hereby request Roundtree and Frank Stinson
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`to disclose, within thirty (30) days of service of this pleading, the information or material described
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`in Rule l94.2(a)-(1) of the Texas Rules of Civil Procedure.
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`PRAYER
`
`WHEREFORE, PREMISES CONSIDERED, Matthew Stinson, NSOH Holiday Road,
`
`LLC, and NSOH Holiday Road II, LLC request that they be awarded a judgment against Roundtree
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`DEFENDANTS’ ORIGINAL COUNTERCLAIM AND THIRD-PARTY PETITION
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`Page 9
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`Automotive Group LLC for the following:
`
`i.
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`Specific performance of Matthew Stinson’s contractual right to inspect books and
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`records of Roundtree;
`
`ii.
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`Specific performance of Matthew Stinson’s contractual right to indemnification
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`and advancement of legal fees as a member and former officer of Roundtree;
`
`iii.
`
`iv.
`
`v.
`
`vi.
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`A formal accounting of Roundtree’s affairs;
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`Actual damages;
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`Exemplary damages;
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`Pre-judgment and post-judgment interest;
`
`vii.
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`Court costs;
`
`viii.
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`Attorney’s fees; and
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`ix.
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`Such other and further relief at law or in equity to which they may be entitled.
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`Matthew Stinson, NSOH Holiday Road, LLC, and NSOH Holiday Road II, LLC further
`
`request that they be awarded a judgment against Frank Stinson for the following:
`
`i.
`
`Indemnification and contribution for any amounts for which Matthew Stinson is
`
`found liable to Roundtree Automotive Group LLC;
`
`ii.
`
`Actual damages;
`
`iii.
`
`iv.
`
`v.
`
`vi.
`
`Exemplary damages;
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`Pre—judgment and post—judgment interest;
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`Court costs;
`
`Attorney’s fees; and
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`vii.
`
`Such other and further relief at law or in equity to which they may be entitled.
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`DEFENDANTS’ ORIGINAL COUNTERCLAIM AND THIRD-PARTY PETITION
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`Page 10
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`

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`Dated: November 13, 2020
`
`Respectfully submitted,
`
`FARROW-GILLESPIE HEATH WITTER LLP
`
`/s/Mafl L. 0 ’Connor
`By:
`Mary L. O’Connor
`State Bar No. 15186900
`
`FARROW-GILLESPIE HEATH WITTER, LLP
`
`1700 Pacific Avenue, Suite 3700
`
`Dallas, Texas 75201
`
`214.361.5600 phone
`214.203.0651 fax
`
`mary.oconnor@fghwlaw.com
`
`/S/ Brad D. Weiss
`By:
`Brad D. Weiss, Esq. Pro Hac Vice Appearance
`CHARAPP & WEISS, LLP
`
`8180 Greensboro Drive, Suite 1000
`
`McLean, Virginia 22102
`(703) 564-0220 (office)
`(703) 564—0221 (facsimile)
`brad.weiss
`cwattome s.com
`
`ATTORNEYS FOR DEFENDANTS
`
`DEFENDANTS’ ORIGINAL COUNTERCLAIM AND THIRD-PARTY PETITION
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`Page 1 l
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`CERTIFICATE OF SERVICE
`
`I certify that a true and correct copy of the foregoing instrument was served on all
`counsel pursuant to the Texas Rules of CiVil Procedure on November 13, 2020.
`
`
`/s/Mary L. 0 ’Connor
`
`Mary L. O’Connor
`
`DEFENDANTS’ ORIGINAL COUNTERCLAIM AND THIRD-PARTY PETITION
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`Page 1
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`

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`Automated Certificate of eService
`This automated certificate of service was created by the efiling system.
`The filer served this document via email generated by the efiling system
`on the date and to the persons listed below. The rules governing
`certificates of service have not changed. Filers must still provide a
`certificate of service that complies with all applicable rules.
`
`Mary O'Connor
`Bar No. 15186900
`mary.oconnor@fghwlaw.com
`Envelope ID: 48095919
`Status as of 11/17/2020 9:09 AM CST
`
`Associated Case Party: NSOH HOLIDAY ROAD LLC
`
` Eliot Burriss -— 11/13/2020 4:39:05 PM ERROR
`
`Associated Case Party: ROUNDTREE AUTOMOTIVE GROUP LLC
`
`m-M—W
`———--
`————-
`———--
`———--
`————-
`———--
`————-
`———--
`———--
`
`
`
`Associated Case Party: NSOH HOLIDAY ROAD ll LLC
`
`
`
`Eliot Burriss -— 11/13/2020 4:39:05 PM ERROR
`
`Associated Case Party: MATTHEW STINSON
`
`Morgan Kleoppel
`
` Michelle Webb
`
`

`

`Automated Certificate of eService
`This automated certificate of service was created by the efiling system.
`The filer served this document via email generated by the efiling system
`on the date and to the persons listed below. The rules governing
`certificates of service have not changed. Filers must still provide a
`certificate of service that complies with all applicable rules.
`
`Mary O'Connor
`Bar No. 15186900
`mary.oconnor@fghwlaw.com
`Envelope ID: 48095919
`Status as of 11/17/2020 9:09 AM CST
`
`Associated Case Party: MATTHEW STINSON
`
`Mary LO'Connor
`
`mary.oconnor@fghwlaw.com 11/13/2020 4:39:05 PM SENT
`
`Eliot Burriss -— 11/13/2020 4:39:05 PM ERROR
`
`Eliot Burriss
`
`Brad DWeiss
`
`————-
`————-
`————-
`
`Case Contacts
`
` Emily Shanks- eshanks@foley.com 11/13/2020 4:39:05 PM SENT
`
`