One of the founders of the Dallas Mavericks is suing a former officer of the failed Tennessee Commerce Bank, saying the latter was negligent in handling $5.6 million used to help build a luxury yacht.
In a suit filed in U.S. District Court, Don Carter says Doug Rogers did not disclose to him that Tennessee Commerce had negotiated away its first-lien position on a loan participation arrangement with Carter just weeks after signing the deal. Rogers, 61, is a former Commerce Union, First American and Bank of America lender who had joined Tennessee Commerce in 2005 and was in early 2009 named senior vice president and leader of the bank's national and small-ticket lending divisions.
Carter, who a month ago also sued Tennessee Commerce executives over losses he sustained as a shareholder, says he agreed in May 2007 to fund a $7.5 million revolving credit line that also included Tampa-based Lazzara Yacht Corp. The complaint — view it here — also says Rogers in early August of that year negotiated an intercreditor agreement with Volvo Financial Services that transferred the first lien on collateral in Carter's deal to Volvo — without telling Carter. The Texas businessman eventually pumped $5.6 million into his Tennessee Commerce relationship and says he is out almost $3.9 million since Volvo last fall seized the Lazzara LSX 92 yacht he helped fund.
"[Rogers'] representatons were pivotal to Mr. Carter when he decided to executive the Participation Agreement," the suit says. "In addition, Mr. Carter would not have funded his portion of the Lazzara draw requests [...] if he knew that Rogers' representations were untrue."
Rogers was traveling Tuesday and could not be reached for comment. Carter, who is calling for a jury trial, is being represented locally by David Randolph Smith and out of Dallas by Steven DeWolf and Todd Hixon of Bellinger & DeWolf LLP.