Birmingham, Al.
Attorneys for Tommy Tuberville and John David Stroud have denied allegations that the duo defrauded investors out of more than $1.7 million.
A lawsuit filed in U.S. District Court on Feb. 24 claims that Tuberville, a former Auburn University football coach, and Auburn resident Stroud lied to investors and failed to return their money when asked to do so. Tuberville and Stroud are co-founders of TS Capital, which operates one or more hedge funds for the investors, according to the lawsuit.
The suit also claims that the duo mixed their personal assets with the plaintiffs’ investments and have “unjustly received substantial benefits” from the investors’ money.
Vic Hayslip, a Birmingham-based attorney for Tuberville, released a statement saying Tuberville was surprised by the lawsuit and never solicited any of the seven plaintiffs for money. Further, Hayslip said, Tuberville has also invested money with the company and not received any returns from it.
“Coach Tuberville has cooperated with every regulatory inquiry and not a single one has asserted that he was involved in any wrongdoing,” Hayslip said. “He intends to vigorously defend the allegations made against him and is confident he will be exonerated.”
Tuberville resigned from his position as Tigers’ head coach in 2008 and has since taken over the Texas Tech University football program.
“Lawsuits are pretty serious, obviously, and so we’ll let the lawyers handle that,” Tuberville told the Lubbock (Texas) Avalanche-Journal after Texas Tech’s football practice Wednesday. “I feel real good about it, but we’ll have to wait and see.”
A Chicago-based attorney for Stroud denied any wrongdoing on the part of his client, also saying that Tuberville was not involved in soliciting investments from the plaintiffs or in the day-to-day operations of TS Capital.
“Given Coach Tuberville’s lack of involvement with the day-to-day operations of the company, as well as the fact that he did not solicit the plaintiffs, Mr. Stroud can only surmise that he was named in this lawsuit to garner unwarranted media attention, which has apparently succeeded,” attorney Harris Kay said.
Kay went on to say that it is “disingenuous and incorrect” for the plaintiffs to suggest Tuberville and Stroud acted improperly when some of the plaintiffs also worked at TS Capital.
The National Futures Association began investigating TS Capital in October 2011 after two of the employees came forward with concerns about their investments. After its investigation, the NFA determined that TS Capital and Stroud “provided NFA with false and misleading information” and prohibited the company from soliciting new investments.
The Financial Industry Regulatory Authority suspended Stroud’s registration in April 2011 after he failed to comply with an arbitration award or settlement agreement or provide a status compliance update, according to a FINRA BrokerCheck Report.
As part of the lawsuit, the plaintiffs are seeking damages, return of their investments, interest and court costs.
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