Two of the many people who lost money when the Nashville-based KiS Golf enterprise imploded last year have won a default judgment of $792,000 against the man they accused of running KiS as a Ponzi scheme.
In a ruling handed down from the bench in July and filed earlier this month, Davidson County Chancellor Carol McCoy found that KiS Golf creator George W. McGill had used his company "as an implement of fraud" and that his conduct amounted to "unfair and deceptive trade practices" and "fraud upon the plaintiffs," Ken and Phyllis Jarnagin of Birmingham.
McGill never responded to the lawsuit after it was filed in January. Court papers give a Mars Hill, N.C. address for him, along with a post office box in Hermitage. Attempts to reach him for comment have not been successful.
He created the KiS concept (short for "Keep it Simple") several years ago and built a network of mall stores by selling territorial licenses to investors. The Jarnagins signed their contract with KiS Golf LLC, but they argued the store they financed was owned by KiS Golf Inc., a separate entity. KiS Golf LLC, the court found, had actually ceased to exist a year and a half before they invested in it.
KiS Golf Inc. filed for bankruptcy and shuttered all locations of its KiS Country Club and Golf Academy chain in November, initially claiming it would restructure and reopen its operations but soon opting to liquidate entirely.
Scores of customers had signed contracts for the KiS package of products and services, which included specialized golf club sets along with lifetime access to a golf pro and indoor practice spaces. But well before the company went under, many customers had complained that they were taken in by high-pressure sales tactics, duped into making onerous financing arrangements and denied the opportunity to back out of the deals even when they changed their minds immediately after signing. The Better Business Bureau found KiS to have an "unsatisfactory record" of sales practices.
McCoy awarded the Jarnagins actual damages of about $183,000 and ruled that they were entitled to have that amount tripled and receive attorney's fees under the Tennessee Consumer Protection Act, as well as interest.
It is not known whether the Jarnagins have been able to collect any of the damages. NashvillePost.com has been unable to reach their attorney, Philip L. Robertson of Smythe Puryear & Robertson in Nashville.