Tuesday, September 2nd, 2008 | Uncategorized | No Comments
Rancho de Andallusia (RDA) is a failed attempt at a winery business in Temecula, California. Created in 2005 by two professional pilots, Larry O’Keefe and Howard Wedertz, the business filed for bankruptcy in mid 2007, shortly after several investors filed lawsuits against the winery and its owners. The lawsuits alleged fraud, breach of contract, securities laws violations, as well as other crimes and misrepresentations.
O’Keefe and Wedertz formed RDA shortly after purchasing vineyard property at the corner of Rancho California and Calle Contento roads. The two then proceeded to solicit money from individuals in exchange for equity in the winery business. Investors were assured that the financial risk was limited because the company’s balance sheet was supported by value of the vineyard property. Despite their assurances, O’Keefe and Wedertz encumbered the property with additional debt, which eventually led the business to insolvency and bankruptcy. The business plan presented to investors promised that the investment money would be used to construct a retail tasting room on the vineyard. Although they had acquired more than $2 million dollars from private individuals, O’Keefe and Wedertz never began any construction on the property.
According to the Riverside County Superior Court records, the following lawsuits have been filed against O’Keefe and/or Wedertz:
| RIC459204 | DIAZ PROPERTIES, LLC VS O’KEEFE | Alleges O’Keefe and Wedertz failed to pay rent on the storage facility used by the winery and another storage business. Dismissed due to a settlement. |
| RIC473042 | CULLEN VS. O’KEEFE | Alleges conversion, fraud, securities violations, and violations of the California Corporations Code. Automatically dismissed due to bankruptcy filing. |
| RIC473042 | SCHMIDT V O’KEEFE | Alleges O’Keefe and Wedertz defrauded an 85 year old man with Alzheimer’s disease by inducing him to invest more than $1 million dollars into the winery. Also alleges other real estate and mortgage fraud involving the elderly man’s home and vacation property. Case is ongoing. |
| RIC477892 | DIAZ ROAD PROPERTIES VS O’KEEFE | Alleges Breach of Contract in the settlement agreement that dismissed the above case, RIC459204. |
Case 2:2007cv02838 was filed in Federal court by another winery investor alleging securities fraud.
In October, 2007, the California Department of Corporations issued an order prohibiting O’Keefe and Wedertz from selling investments in California because they made “untrue statements of material fact or omitted to state material facts necessary in order to make the statements made [...]” to RDA investors.
At least 15 people made investments into RDA. Although some investors who pursued legal action early were able to recover their money, most are still awaiting the outcome of current and pending cases. RDA was forced by the courts to liquidate all of its assets as part of a Chapter 7 bankruptcy, and it is likely that most investors will lose everything.
Larry O’Keefe now lives in Renton WA. Howard Wedertz lives with his wife Susan Wedertz on the Encore ranch in Temecula.