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engineering and manufacturing company engaged in the production
of high-tech computers for the telecommunications industry.
Karras received the initial solicitation for Davenport from
his personal accountant of 20 years, Barry Swartz (Swartz), who
recommended the Davenport investment. Karras testified that,
when he invested in Davenport, he believed that plastics
recycling had a good future. When Karras invested in Davenport,
he knew that Winer was the general partner.
After reading the Davenport offering for the "basics",
Karras gave the offering to his attorney, John Karones (Karones).
According to Karras, after Karones reviewed the Davenport
offering he said, "This is a pretty risky thing, plastic
recycling", and questioned whether the recyclers described in the
offering really existed. Karras testified that he then called
his accountant, Swartz, for confirmation that the recyclers
really existed. After a few days, Swartz reported back to Karras
that someone that Swartz knew had seen the recyclers. Neither
Karras nor Swartz actually saw any of the recycling machines
before Karras paid $50,000 for his interest in Davenport.
During the proceedings in the underlying Davenport Recycling
case, Karras became aware that Winer, as TMP, had filed a
petition with this Court. Karras did not receive further
information or updates from Winer regarding the status of the
case after the filing of the petition. Karras claims that he did
not learn that the case involving Davenport had been settled
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Last modified: May 25, 2011