By NEIL HARTNELL
Tribune Business Editor
nhartnell@tribunemedia.net
Bahamian creditors are facing opposition to their push for a $1.113 million default judgment against Jamie Dingman’s failed Nassau restaurant empire.
American attorneys for Mr Dingman, son of world-famous entrepreneur and Lyford Cay resident, Michael, argued yesterday that a ‘default certificate’ previously obtained against their client “must be set aside”.
Jeffrey Mitchell, of the Browne George Ross law firm, called on the southern New York federal court to take such action on the grounds that Mr Dingman and his five former Nassau restaurant brands had not been properly served with the original action.
His letter to Judge Naomi Buchwald implies that he will ultimately argue that the New York court has no jurisdiction over Mr Dingman, and that the lawsuit - involving seven Bahamian companies and individuals as plaintiffs - should be thrown out as a result of the venue being “improper”.
Pointing out that Mr Dingman is a permanent resident of the Bahamas, Mr Mitchell said that since all five restaurant companies were Bahamian domiciled, it would have been more appropriate to serve their local agent, the corporate services arm of the Graham, Thompson & Co law firm.
The original lawsuit, filed on behalf of well-known Bahamian companies such as Wulff Road-based Tile King and FYP (Fix Your Place), is seeking to collect what Mr Dingman allegedly owes them for unpaid services and goods supplied to his collapsed Nassau eatery ventures, plus damages.
Mr Dingman missed the February 16 deadline to file a defence to their claim by more than one month, and they obtained a ‘Certificate of Default’ from the southern New York court clerk on March 16, 2016.
This potentially paved the way to obtain a default judgment against Mr Dingman, but his attorneys have moved with remarkable speed at the ‘11th hour’.
“We are appearing in this action for the sole purpose of challenging the exercise of personal jurisdiction over the defendants,” Mr Mitchell wrote, adding that Mr Dingman would likely move to overturn the certificate and “stay any proceedings for entry of a default judgment”.
“The default was obtained as a consequence of defective service of process and must be set aside,” Mr Mitchell argued in his letter.
“Dingman was not served personally. He is a United States citizen who permanently resides in the Bahamas. He does not live in or do business in New York or New Hampshire (the place of service), nor do any of the corporate defendants.
“This case concerns restaurants that operated exclusively in the Bahamas. Of the 20 parties, only one is from New York (Dingman is mischaracterised as a New York resident, which he is not), 13 are from the Bahamas, and the rest are from various other locations, including Florida, Nevada, and Singapore.”
The plaintiffs, including the Bahamian companies and individuals, previously confirmed that the action had been served on Vicki Inskeep-Brown, an assistant to Mr Dingman, at his “place of business” on January 26, 2016.
This is located in New Hampshire, but Mr Mitchell said this was not Mr Dingman’s place of business - rather, it was a property used by his parents.
“The New Hampshire address is not Dingman’s actual place of business, nor did he conduct business there during the relevant time period,” the attorney alleged.
“Dingman’s parents use the New Hampshire property for their own interests. Dingman, who is 41 years old, has no involvement with those interests. Dingman’s father is a wealthy individual, as the complaint alleges, and Ms Inskeep-Brown is a long-time family employee who, over the years, has acted as Dingman’s personal assistant from this remote location, and in that role, may have interacted with one or more of the plaintiffs.”
Mr Mitchell argued that Ms Inskeep-Brown was not employed by Mr Dingman, and was not authorised to receive service and legal documents for him.
As for the five restaurant brands, the attorney added: “Service on the five corporate defendant entities was similarly defective. They all are Bahamian corporations with their principal places of business in the Bahamas.
“These entities all have designated GTC Corporate Services Ltd, located in Nassau, the Bahamas, as their registered agent. Nonetheless, instead of serving the registered agent, plaintiffs have purported to serve these corporate defendants by leaving additional copies of the papers with Ms Inskeep-Brown in New Hampshire.”
The five companies are the failed Nassau restaurant ventures: The Traveller’s Restaurant, 25 North Ltd, Island Smoke House Ltd, Out West Hospitality and Bahamex Ltd.
The original lawsuit, filed early in the New Year, claimed that Mr Dingman has effectively abandoned his creditors and investors and “fled the Bahamas altogether”, refusing to pay what he owes.
It alleges that he had stopped communicating with them, and is “hiding out in his girlfriend’s apartment in downtown New York City” in a bid to escape both his Bahamian creditors and ex-employees, plus foreign associates he either hired to assist him or induced to invest in the Nassau-based restaurants.
Mr Dingman’s efforts to build a Nassau-based restaurant and hospitality business included taking over the iconic Traveller’s Restaurant in western New Providence via a lease arrangement.
That venture failed and the property shut again, until members of the Bain family, its owners, re-opened it again this summer.
He also leased two units in the Klonaris brothers’ Elizabeth on Bay plaza on Bay Street for two other restaurant formats, both of which have also closed.
Tribune Business also revealed how Mr Dingman leased the Beach Club Cafe from Sandyport’s developers, viewing this as his “signature property”. The venture never opened, and the lease was pulled.
The lawsuit alleges that FYP and Tile King are owed more than $8,000 for building materials and supplies delivered to Mr Dingman’s businesses, but which were never paid for.
Other Bahamian businesses suing Mr Dingman via this lawsuit include the People First (Bahamas) employment agency, which claims to be owed more than $160,000.
Then there is Young Digerati (YNG), a small Bahamian-owned business, which lost more than $3,000 on a promotional event it wanted to hold at Mr Dingman’s Island Smoke House because the venue had been left “uninhabitable”.
“When YNG Group confronted Dingman about the situation, he dismissed their concerns, asking: ‘What are you gonna do? Sue me?’,” the lawsuit alleged.
IDNet, another Bahamian plaintiff to the lawsuit, allegedly provided $10,057 worth of information technology services and products to Traveller’s Rest, the Island Smoke House and 25 North, for which they were never paid.
The individual Bahamians suing Mr Dingman include Jason Rolle, his former general manager, who claims to be owed $46,113 in unpaid salary and benefits, plus Tyrone Adderley, a contractor due more than $2,000 for work on the Beach Club Cafe at Sandyport.
The lawsuit also discloses that among those induced to invest in Dingman’s failed businesses was Atlantis public relations chief and radio host, Ed Fields.
He was alleged to have invested $25,000 in the Traveller’s Restaurant business, in return for an equity stake in Out West Hospitality, the holding company for Mr Dingman’s Nassau restaurant ventures. Mr Fields, though, is not named as a plaintiff in the lawsuit.
The action suggests that Mr Dingman expanded too far, too fast, and Out West Hospitality’s financial position steadily worsened to the point where it became unsustainable, leading to the eventual collapse.
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