Article Preview: Medford vineyard owner's companies made millions by skimming off subscription sales, AG alleges - MailTribune.com - Medford, OR

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2015-04-05

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3 of 3 Premium Clicks used this month SUBSCRIBE Print + Online Subscriber Activation  |  Register x Forgot Password | Need an Account? e-edition | subscribe | newsletter | deals Home News Latest Stories Emergency services, April 5 Graduation rates among special ed students in Jackson County improve but fall short of 67 percent target Cute smiles, chubby cheeks win judges' hearts in annual Pear Blossom Baby Contest in Medford Learn about proposed 55-mile scenic bikeway outside Ashland Start saving plastics now for May round-up Crime, Courts and Emergency Services Emergency services, April 5 Emergency services, April 4 Social media helped track down AmericanWest Bank robber, Medford police say Jury awards damages to Rogue River couple that lived next to noisy dogs U.S. Bank robbery suspect charged in Minute Market crime Politics and Elections Arthur I. Cyr: Afghanistan progress is uneven but undeniable Jackson County Commissioners plan no tax on marijuana for one year Arthur I. Cyr: Iran – a crisis without end Arthur I. Cyr: South Korea represents long-term triumph – for them and for US Special election: Jackson County voters OK marijuana tax Education Graduation rates among special ed students in Jackson County improve but fall short of 67 percent target New SOU board hikes tuition 5 percent Southern Oregon Education Service District superintendent to retire in June Which comes first: The rocket or the egg? Medford School District one of most accident-prone in state Environment A sea-foam change Rogue Valley lions on their way to California Corps hopes to clear Lost Creek Lake of debris Beetles taking toll on Ashland pines Mt. Ashland Ski Area to host party March 28 State News City rules drive Uber ride-hailing service out of Eugene District fires Oregon's 2014 Teacher of the Year Oregon lawmakers consider increasing highway speed limits State releases 94,000 emails from former first lady Cylvia Hayes Man accused of arson in Albany high school cafeteria fire Nation - World Obituaries William D. Enyart Gordon Geeseman Patricia Anne Johnson Patricia E. Rees Gary Dahl Weather Photo Galleries Since You Asked Videos Web Cams Mail Tribune 100 Shareable Sports Latest Stories Ducks' Buckner sidelined for spring Blazers again hit 50-win mark 'Cats go pfft!, not perfect Timbers dump Dallas for first victory Barkley, McGowne pace SOU at Linfield Varsity 541 College Sports Ducks' Buckner sidelined for spring 'Cats go pfft!, not perfect Barkley, McGowne pace SOU at Linfield Freshman lead Duke into title game Rozario, Ghelfi set SOU track records Pro Sports Blazers again hit 50-win mark Timbers dump Dallas for first victory Spieth grabs one-shot lead at Houston Blazers celebrate division title with triumph Green's 22 lead Grizzlies past Thunder Community Sports Business Latest Stories Road to health: Bike and pedestrian paths play greater role in transportation project funding Jackson County median home price hits $215,000 in first quarter Blog: The Season for Cleaning Blog: Nothing succeeds like ... a good wine promotion Ride & Drive: 2015 Ram Laramie Longhorn 1500 Real Estate News Jackson County median home price hits $215,000 in first quarter East McAndrews Road sees a resurgence in commercial projects Business briefs: March 7 People In Business People in Business, March 26, 2015 Transportation Road to health: Bike and pedestrian paths play greater role in transportation project funding Rogue Disposal plans natural gas fueling site Alaska, United Express boost Medford airport to record February Agriculture Broth maker leaves San Diego for Medford Opinion Latest Letters to the Editor, April 5 Our View: State income tax sharing run amok Dana Milbank: Bob Menendez should resign Guest Opinion: If Courtney kills bill, $15 minimum wage will go to the ballot Michael Gerson: The virtues of the smoke-filled room Editorials Our View: State income tax sharing run amok Other Views: Rethink gillnet ban on the Columbia Our View: Local water supplies are not unlimited Our View: Cheers and Jeers Our View: The tangled web at Medford's Northgate Centre Letters to the Editor Letters to the Editor, April 5 Letters to the Editor, April 3 Letters to the Editor, April 2 Letters to the Editor, April1 Letters to the Editor, March 31 Columns Dana Milbank: Bob Menendez should resign Guest Opinion: If Courtney kills bill, $15 minimum wage will go to the ballot Michael Gerson: The virtues of the smoke-filled room Guest Opinion: Phoenix embraces Bee City USA designation Matthew T. Mangino: Prison deaths on the rise Guest Opinions Guest Opinion: If Courtney kills bill, $15 minimum wage will go to the ballot Guest Opinion: Phoenix embraces Bee City USA designation Guest Opinion: Marijuana offers Oregon benefits, drawbacks Guest Opinion: How to end the influence of money in elections Guest Opinion: How schools teach U.S. history raises hackles Lifestyle Latest stories Southern Oregon Journal: The famous Southern Oregon Coast Easter lilies Adopt a Pet A little fiction is like salt Solving the caregiving riddle takes care Choose your own adventure Food Community blog: Light lemon souffles are an easy Easter treat Page H. Onorato: Leftover ham and eggs make for some yummy dishes after Easter The journey from inspiration to written recipe Tammy Kelly: Lighten up traditional Easter desserts Kitchen Call: Goat cheese recipes worth bleating over Home and Garden Carol Link: Pruning rose plants, step by step How often should you paint the outside of your house? Carol Link: It’s time to get into shape for spring yard work Dear Monty: Relocation brings pay raise and challenges Garden Cameos: Planning for a fragrant garden year round Health Health Watch: Work out like a pro athlete Brent St. Germain: Feeling the burn again HealthStyle: Normal anxiety or anxiety disorder? Community blog: How to Get Rid of a Tension Headache St. Mary's student helps others with diabetes Hiking Biking Faith Religion briefs: Friday, April 3 Religion briefs: Friday, March 27 Religion briefs Religion News: Presbyterian Church gives approval on same-sex marriage Religion briefs: Friday, March 13 Milestones and Achievements Haga-Parks Exercise helps special-needs kids adjust to airport procedures Columnist for a Day Rogue Healthy Aging Tempo Latest stories Here's Tempo's 5 picks for entertainment this week Live Music in Local Clubs A Country Cajun Revival comes to the Unitarian Ashland's First Friday Art Walk showcases new exhibits by regional artists New exhibits open at Schneider Museum of Art Theater Auditions for youth musical set at Camelot Review: From past into present in OSF's 'Long Day's Journey' ‘A Dream of Red Pavilions’ at the Oregon Shakespeare Festival Review: Education and its discontents Next Stage Repertory presents 'Educating Rita' at the Craterian Theater Music Elias String Quartet plays at Southern Oregon University Bluegrass band Siskiyou Summit plays Bell Fiore Winery Oregon Old-Time Fiddlers at the Ashland Community Center Live Music in Local Clubs A Country Cajun Revival comes to the Unitarian Community Events MailTribune.com rolls out new calendar Hip-Hop Poetry Open Mic at the Oregon Shakespeare Festival Easter egg hunts are a long-standing tradition in the Rogue Valley Get Up & Go: Friday, April 3 Ashland's First Friday Art Walk showcases new exhibits by regional artists Dining RESTAURANT INSPECTIONS: Sunday, April 5 The Laughing Clam in Grants Pass offers seafood-heavy menu Standing Stone owners to open Medford brewpub and restaurant Restaurant Inspections: March 29 Basque-inspired cuisine at Eleven in Ashland Tempo Videos Classifieds Jobs Autos Real Estate FEATURED   » Obits Blogs TV Listings Movie Listings Oregon Outdoors Oregon Healthy Living Special Sections Business Services NEWS NOW   Graduation rates among special ed students in Jackson County improve but fall short of 67 percent target       ...       Our View: State income tax sharing run amok       ...       Guest Opinion: If Courtney kills bill, $15 minimum wage will go to the ballot       ...       Graduation rates among special ed students in Jackson County improve but fall short of 67 percent target       ...       Our View: State income tax sharing run amok       ...       Guest Opinion: If Courtney kills bill, $15 minimum wage will go to the ballot       ...           SUBSCRIPTION INVESTIGATION Medford vineyard owner's companies made millions by skimming off subscription sales, AG alleges Jeffrey Hoyal's companies made millions by skimming off subscription sales, AG says By Thomas Moriarty Mail Tribune MailTribune.com By Thomas Moriarty Mail Tribune Posted Apr. 2, 2015 @ 5:39 pm By Thomas Moriarty Mail Tribune Posted Apr. 2, 2015 @ 5:39 pm »  Social News p bs:newslist StartDate="20121121" EndDate="p bs:datecalc Months="3"" DateSort="1" UseObjects="1" ObjectClass="81" Taxonomywords="2325,665" ExactTaxonomyMatch="1" Image="1" Count="4" --> State prosecutors say a successful Medford businessman with ties to the local wine industry is behind several companies involved in an elaborate magazine subscription scheme now the subject of a racketeering lawsuit by the Oregon Department of Justice. The lawsuit, filed Tuesday in Marion County Circuit Court by Senior Assistant Attorney General David Kramer, alleges that Southern Oregon-based Henry Cricket LLC and Maximillian Inc., among other companies, scammed consumers out of more than $20 million by fraudulently inflating newspaper and magazine subscription prices. Prosecutors allege that Jeffrey Hoyal, who's been developing a winery near Jacksonville with a former RoxyAnn winemaker, used Henry Cricket, Maximillian and other "consulting" companies he owned to control the bulk of the subscription-sales business through numerous company names. Other state attorney generals in New York, Minnesota, Missouri and Texas filed similar lawsuits. Hoyal gained local attention in 2008 when he began planting olive trees on a 140-acre parcel of his sprawling estate off Bellinger Lane. He lost a significant portion of the trees to the winter of 2009, and later replanted much of the land with wine grapes. According to Mail Tribune archives, Hoyal's land was first purchased by Reality Kats, a limited-liability corporation named as a defendant in the DOJ lawsuit. Jackson County property records list the total value of Hoyal's property at more than $2 million. Prosecutors say the consulting companies were used to manage and direct a number of subscription-marketing businesses based in the White City area. The companies allegedly misrepresented their authority to sell third-party publications and falsely claimed to offer the lowest subscription price available through thousands of unsolicited subscription renewal forms mailed across the country. Publications affected included the New York Times, Wall Street Journal and the Portland Tribune, court documents say.  Attempts to reach Hoyal Thursday for comment were unsuccessful. Prosecutors say the six direct-mail companies have generated more than 1,400 complaints to the state since 2010 from consumers and publishers regarding inflated prices. The business enterprise allegedly used a number of holding companies, including Maximillian and Reality Kats, to launder its profits, court documents claim. According to an affidavit by a state fraud investigator, other individual named defendants were unable to explain large payments, some as high as $150,000, regularly made to Hoyal’s companies. A business name used by one of the direct-mail companies identified in the lawsuit, Liberty Publishers Service, apparently was first acquired in 2003 by Raybor Management Inc., of which Hoyal was then president and CEO. Raybor's 2004 filing with the Securities and Exchange Commission described the company's direct-mail marketing arm, IC Marketing, as a "low cost provider of subscription acquisition, focusing on upscale consumers interested in higher-end business and lifestyle publications." In 2003, IC Marketing sued the publisher of Fine Woodworking magazine for sending notices to subscribers warning them of the company's solicitations. Lawyers claimed the notices were defamatory, but a judge ultimately dismissed the lawsuit. In 2004, a Marion County Circuit Court judged ordered IC Marketing to pay more than $70,000 to the state’s Consumer Protection and Education Fund after the DOJ filed a lawsuit making allegations similar to its current complaint. IC Marketing dissolved in 2006, but one of its former business entities, American Consumer Publishing, is named in the new lawsuit. Marion County court records don't yet list counsel of record for any of the defendants, but documents say the businesses and many of the defendants have been represented in the past by Medford attorney David P. Lennon, himself named as a co-defendant in a similar lawsuit filed Tuesday by the New York Attorney General’s Office. Lennon said Wednesday that he's represented several of the defendants in the past and likely will be representing some of them in the future, but couldn't confirm which ones. All will be "vigorously defending themselves" against all allegations of wrongdoing, he said. Jackson County property records show Lennon's home, located near Hoyal's on Bellinger Lane, was first purchased by Reality Kats in 2006 before being sold to Lennon in 2011. Marion County Circuit Judge Claudia Burton Tuesday approved a temporary restraining order on the defendants' bank accounts and appointed a computer forensic expert as a temporary receiver to secure electronic evidence at the White City and Eagle Point offices. Prosecutors filed a motion Thursday seeking expedited discovery of the financial records. Other individuals named in the suit are  Noel Parducci, Laura Lovrien, Colleen Kaylor, Shannon Bacon, Lydia Pugsley, William Strickler, Linda Babb and Rachel Worcester. Reach reporter Thomas Moriarty at 541-776-4471, or by email at [email protected]. Follow him at @ThomasDMoriarty. By Thomas Moriarty Mail Tribune MailTribune.com By Thomas Moriarty Mail Tribune Posted Apr. 2, 2015 @ 5:39 pm » Comment or view comments   /* $( document ).ready(function() { // Jquery mobile is trying to style the button and leaving a blank gry button on top of a white button $("#viafouracoms .vf-comment-controls li.vf-right").html(' Submit '); });*/ »  STAY INFORMED   Email NewsLetter   Sign Up Today   Sign up for our newsletter and have the top headlines from your community delivered right to your inbox. calendar Connect with MailTribune.com Facebook Twitter RSS Back to top Reader Services Reader Services Home Subscriptions Subscriber controls Contact us Submissions Photos Events Letters to the editor Corrections Announcements Obituaries Story ideas Since you asked Alerts Email Alerts RSS Feeds Text Alerts Advertise Media Kit Home Products and services Ad rates Advertising contacts Mail Tribune Daily Tidings The Nickel Shop Our Valley Blogs Stay Informed   Email newsletter   Sign Up Today   Sign up for our newsletter and have the top headlines from your community delivered right to your inbox. 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