Louisiana Voice

By ROBERT BURNS

Everyone by now is aware that Gov. Jindal has been concerned with little else since he became Governor of Louisiana beyond self-promotion and his own political advancement to the White House.  What isn’t so obvious to most Louisiana citizens is that many of his appointees to Louisiana boards and commissions are equally ego-driven with little or no regard for the citizens they are supposed to serve and protect.  Prime examples are Gov. Jindal’s appointees to a little-known board overseeing auction regulation in Louisiana, the Louisiana Auctioneer Licensing Board (LALB).

Now, if it were only that such ego-driven appointees have included a past chairman who was “demoted” to mere member while another “consumer” member simultaneously resigned as evidence of travel voucher irregularities on the parts of both members surfaced, that would be one thing.  If just the mere fact that certain LALB members believe that they have a right to freely engage in racist roll calls, that would be one thing.  It would also be one thing that, despite the fact that LouisianaVoice readers may revel in hearing a lambasting of Gov. Jindal, it nevertheless is an act of unprofessionalism in a public meeting (anger over Jindal’s stripping of LALB per diem payments notwithstanding).  The member doing so, LALB Vice Chairman James Sims, is the same one who made the first “I’s here,” roll call response at the first link above.  Sims went further on the preceding audio clip to relay on November 5, 2012 (the day before the Presidential election) that “it ain’t gone happen” regarding Republican presidential nominee Mitt Romney (had he prevailed) appointing Gov. Jindal to a cabinet position.

It would be yet one more thing that these members felt they had the right to permit its sole employee to vacation all over the country and routinely conduct personal business while declaring herself to be “on the clock,” thus prompting Louisiana Legislative Auditor Daryl Purpera to release this damning report.  That report, in turn, was subsequently followed by this report by the Louisiana Inspector General’s Office (OIG) in which the sole employee lied to investigators about taking vacations while being “on the clock.”  The OIG likely figured there was no chance LALB members would accede to their recommendation of “appropriate disciplinary action up to and including termination,” and, in fact, OIG officials would have been right as LALB members unanimously approved a third pay raise for its executive director four months after the release of the report.  Also, two of those three pay raises transpired, as noted in Mr. Purpera’s report, during a period of salary freezes for rank-and-file Louisiana state workers.   Further proof that Jindal facilitates his LALB appointees who, in turn, facilitate irresponsible payroll practices is evidenced by board members and legal counsel relaying Jindal has said “all is fine and you cannot recover any funds.”

No, all of the preceding egregious acts entail general ego-centered individuals who feel as though they have “power from on high” vested in them through their appointments by Gov. Jindal.  Essentially, they merely entail their beliefs that they have little or no fiduciary duty regarding auctioneer licensee funds with which they have been entrusted.  While being oblivious to their fiduciary duties certainly affects auctioneers, the public, because of a lack of coverage by the media, is understandably unconcerned by the practices.  The general public’s concern is (or at least should be) heightened, however, when Gov. Jindal’s LALB appointees are so brazen and arrogant and dismissive of their core duties and function that they literally force an 84-year-old widow to file a pro se lawsuit to compensate her for the LALB’s overly-protective stances regarding auctioneers.  Such stances have routinely transpired in the six (6) years I’ve observed the LALB, very much to the detriment of the general public whom they ostensibly serve to protect.  Thus far, auction victims have just “licked their wounds” and left disappointed at what they often correctly perceived as a very corrupt industry.

That was all, however, before a lady named Ms. Betty Story entered the LALB’s den of foxes.  In a mere five-page pro se lawsuit filed in 19th JDC in Baton Rouge on August 27, 2014, Ms. Story alleges that she encountered a “nightmare” regarding her November 17, 2012 auction.  She relays that her auctioneer, Marlo Schmidt, at a time when she was 82 years old, failed to explain to her that she could place reserves on certain of her items being auctioned.  She outlined the items which she specifically wanted to set reserves upon:  a mirror ($300), an Ethan Allen wetbar ($4,000), a set of sterling silverware ($5,000), and an antique saddle ($5,000).  She further averred that Schmidt didn’t inform her that she would owe 40% of the final bid prices as commissions, in addition to a 10% buyer’s premium assessed against buyers (which itself lowers bid amounts).  Additionally, Ms. Story avers that Schmidt pleaded with her to cancel two real estate listings with ReMax (including her personal residence) so that they could be included in her auction.  In fact, Ms. Story avers that, as an incentive for her to do so, Schmidt “promised” her $42,500 for a rental home she owned and $120,000 for her personal residence.  Based on his “promises,” Ms. Story relayed she appealed to ReMax to cancel her listings, and ReMax reluctantly agreed as a favor to her for her past business. Accordingly, the two real estate properties were included in the auction with Ms. Story anticipating $162,500 minimum for the two houses based on Mr. Schmidt’s “promises.”  The only way any auctioneer can “promise” a result is if he or she is willing to buy the properties personally if the bids fail to reach that pre-set amounts at auction.

Ms. Story further averred in her lawsuit against the LALB that Schmidt went so far as to buy her rental property prior to her auction, and he advanced her $25,000 ($17,500 short of the “promised” amount) so that she could move into an assisted living facility ahead of the auction and thereby be exempt from having to pay a deposit on her room.  The subsequent auction was an unmitigated disaster, with Schmidt’s nephew ending up high bidder on the rental home.  His nephew then adamantly refused to honor his bid (likely because his nephew was a shill bidder, which is illegal in Louisiana but many auctioneers, as well as the LALB, ignore that illegality and actively encourage the practice).  In fact, LALB Vice Chairman James Sims, during the LALB hearing on the matter, said of that situation, “This board could easily think something else,” (of the fact Schmidt’s nephew dishonored his bid — clearly referencing shill bidding without saying the dirty words).  Although Ms. Story had to threaten to sue Mr. Schmidt for the balance of the $42,500 purchase price on the rental home, he did finally remit the balance for the home that he already had title to even prior to auction!  However, her personal residence auction was a flop, resulting in a “no sale” rather than the $120,000 he’d “promised” her.  Furthermore, because of the fact no reserves were set on her high-end items and Schmidt instead had Ms. Story bid (and pay commissions) on those items in order to retain possession of them, Schmidt submitted a final bill to Ms. Story for $201.11 as her “net proceeds” from the sale of her personal items!  In other words, Ms. Story’s commissions for retaining her treasured items exceeded the proceeds of the items Schmidt sold, which constituted the vast majority of her personal belongings!  So, Schmidt claimed Ms. Story owed him $201.11 for the “privilege” of having most of her personal belongings vacated from her home at what Ms. Story contended were below bargain basement prices.

As if all of the preceding events aren’t bad enough, Ms. Story had to leave the assisted living facility after only three nights because of the disastrous auction results, and she was charged $1,500 for her three-night stay.  Ms. Story filed a complaint with the LALB, and her LALB hearing transpired on September 10, 2013.  Like many other auction victims, Ms. Story naively believed the LALB would be sympathetic to her plight and work to remedy the wrong she’d endured.  Even though the LALB’s own attorney, Anna Dow, relayed there was “clear deception” and that “the auction should have been conducted in a very different manner,” and one of the board members, Darlene Jacobs-Levy, an attorney with 44 years of practicing law said, “Mr. Schmidt, you clearly owe Ms. Story more than the $1,300 you’ve offered her to settle this matter,” the LALB once again officially found auctioneer Schmidt not guilty of any auction violations.  After the hearing’s conclusion (as reflected on the video), Ms. Jacobs-Levy instructed Schmidt to “go out in the hallway and work this out with Ms. Story.” She also informed Schmidt that she felt the 40% commission he charged Ms. Story was “usurious.” Instead of “working it out with Ms. Story in the hallway,” Schmidt, with the hammer gone from over his head, proceeded straight to his vehicle and back to DeRidder and refused to have subsequent negotiations with Ms. Story.  Consequently, Ms. Story had to sue Mr. Schmidt in small claims court in DeRidder to try and recover at least some of her damages.  More importantly, however, is the fact that, by officially finding him “not guilty,” the LALB effectively blocked Ms. Story from being able to pursue Schmidt’s $10,000 bond which is a requirement for auction licensure in Louisiana.  No bonding company is going to pay a claim when the regulatory body of a state has failed to find an auctioneer guilty of an auction violation.  Hence, Ms. Story’s lawsuit seeks to recover the $10,000 from the LALB that she would have otherwise been able to recover from Mr. Schmidt’s bond had the LALB found him guilty.  Of course, to find him guilty, LALB members would need to have shelved their self-centered, steadfast resolves to stay popular among auctioneers irrespective of the consequences to victims like 84-year-old widow Betty Story.  In failing to do so, they exhibited many of the same traits of the gentleman who appointed them:  Gov. Bobby Jindal!