Arlie selective as it amasses host of holdings

Arlie still doing business with Hong Kong gambling tycoon

Musumeci has history of speculative tactics

LAST FRIDAY, in a dry, windswept field next tothe McKenzie River in Springfield, a cluster of upbeat PeaceHealth officials gathered to declare the spot their choice for a huge new hospital.

Missing was the man who had reason to be far more pleased than the hospital officials: John Musumeci, an executive with Eugene development firm Arlie & Co. In the preceding months, Arlie -
under Musumeci's leadership - had bought the 75 acres that PeaceHealth was now announcing it wanted. Arlie also had bought or quietly acquired options on 75 adjacent acres.

The value of the adjoining acreage is likely to soar if Springfield approves the hospital's project. Plus, in PeaceHealth, Arlie gets a wealthy, respected development partner that will help devise a master plan for the area and help build roads and other infrastructure.

And there's a bonus for Arlie: a three-year option to buy 38 acres owned by PeaceHealth at Crescent Avenue and Coburg Road in Eugene for $5 million. That's the land where PeaceHealth earlier this year first proposed building its new hospital.

The Arlie-PeaceHealth plan is trademark Musumeci: buy land on speculation, work furiously to nail down a big development concept, gamble that nothing goes wrong and look to rake in the payoff. John Musumeci, consummate risk-taker, is perhaps the most unusual and controversial businessman to set up shop in Lane County in years.

Until earlier this summer, Musumeci and Arlie were hardly household names, even though Arlie and its affiliates have built up a $30 million portfolio of Lane County real estate, mostly raw land. Outside real estate circles, Musumeci was little-known.  That began to change July 25, when the members of the anonymous Gang of 9 - including Musumeci - unveiled themselves. For weeks up until that day, the gang's unsigned daily paid cartoon ads in The Register-Guard skewered liberals on Eugene's City Council.

The smart money had bet that the brash Musumeci was involved with the $1,000-a-day cartoons - although in interviews with The Register-Guard he had denied any role. PeaceHealth's deal last week with Arlie pushes the company and Musumeci - a 55-year-old Massachusetts native - fully into the spotlight.  Musumeci, with his wife, Suzanne Arlie, jumped into the Oregon real estate speculation business about a decade ago, after moving from California to Douglas County and then to Lane County.

The Register-Guard over the past two months has examined Musumeci and his business history.

Musumeci declined repeated interview requests over the past  four weeks, although he did answer some questions in writing. But previous interviews with Musumeci, along with interviews with many people who have worked with him, and extensive public records offer plenty of background.

The records are mainly a huge body of documents from dozens of business lawsuits filed by and against Musumeci and his corporate incarnations in Oregon and the San Francisco area over many years. Many of the lawsuits involve his long fight with a former employer, the ComputerLand retail chain.

His personal bankruptcy reorganization, which he filed in 1988 and from which he emerged in 1992, also offers many details. Together, the records paint a picture of a belligerent go-getter and cunning, high-risk businessman. The records also suggest that since coming to Oregon, Musumeci's litigiousness has abated somewhat. Of the 17 lawsuits filed by or against him in Lane and Douglas counties, many involve run-of-the-mill business disputes.

But it's not just his business life that's remarkable. His personal behavior has sometimes been alarming. For example, in Douglas County in 1995, he was convicted on a felony weapons charge for waving a gun at a former employee and threatening his life. Musumeci says he knows he's loathed by some and admired by others.

His supporters include PeaceHealth CEO Alan Yordy, who said that as part of the Gateway land negotiations, Musumeci sat down with him and disclosed many details of his history. "I know we all have things in our past that we wish we didn't have. Based on what John has told us, he certainly has those things," Yordy said.

Yordy, who will be working closely with Musumeci in the next few years, said he has no concerns about Musumeci's "colorful past." The story of John Musumeci, he said, is "a bit of a story of repentance."

Others aren't convinced.  Many in Lane County's business community say they are put off by Musumeci's theatrical behavior. Angry, accusatory or condescending one minute, he can be pleasant and joking the next. His fans include real estate brokers who profit from his deals. They say it's a mistake to read too much into Musumeci's confrontational tactics.

"I know that his style has caused some debate around town," said Eugene broker Greg Buller, who has worked with Musumeci for a dozen years. "But it's just business, the way he conducts business." Eugene broker Dan Montgomery, who has worked with Musumeci for several years, said he's heard plenty of vague criticisms of Musumeci. "Some of those are bias against an East Coast accent and an aggressive individual," he said. "Seeing him, I do realize this is quite a provincial and conservative area when it comes to real estate dealings. John probably has a little more flair and personality than we're used to," Montgomery added.

But much in Musumeci's past is eye-opening. It's hard to imagine a more bizarre and dispute-riddled business background than his. Here are highlights:

In California, he spent more than a decade up until 1992 in a web of business litigation surrounding ComputerLand. As part of that, Musumeci filed bankruptcy, claiming he had a whopping $1.7 billion in liabilities. He settled, successfully repudiated or repaid his debts by 1992, shortly after he started his real estate dealings in Oregon.  Buying at the peak of the Lane County real estate market in the past couple of years, Arlie, under Musumeci's guidance, has accumulated a $30 million local portfolio, plus more real estate elsewhere in Oregon. Much of it is vacant land that Musumeci is speculating will yield big returns.

In 1995, Musumeci was convicted on a felony weapons charge and two related misdemeanors in Douglas County for pointing a gun at a former employee and threatening his life. Musumeci received a 20-day jail sentence, converted to home detention and three years of probation. He appealed the conviction to the Oregon Supreme Court and lost. Musumeci also failed in a 1998 effort to get the charge reduced to a misdemeanor.

In 1994, a Douglas County man whom Arlie & Co. sued over a piece of farm equipment wrote a letter to the judge saying he was afraid to return the gear without a sheriff's deputy present because he said Musumeci threatened to kill him, according to court records.

The previous year, Musumeci was the victim of violence in Douglas County, held at gunpoint and kidnapped by a different ex-employee who claimed that Musumeci owed him $5,000 in back wages. Musumeci escaped, and the ex-employee went to prison, where he died.

In his wake, Musumeci has left many angry, bitter people. One of Musumeci's former lawyers wrote this about him in 1988:  "The man is a snake. ... He threatens people ... This man is contemptible and cannot be trusted." The letter is in Musumeci's bankruptcy file. During a 1988 custody hearing in Hawaii on Musumeci's children, Musumeci spat in the face of a Catholic nun who helped care for his two children, according to an affidavit filed by the nun.

Endless litigation.  Born in Massachusetts in 1946, Musumeci never finished high school, according to a 1987 book about ComputerLand, "Once Upon a Time in ComputerLand." But the lack of a formal education did not slow him down. The book chronicles the ups and downs of ComputerLand, the nation's first major retailer of  personal computers.

In the 1970s, Musumeci shaped ComputerLand's franchise system. Then he quit the company and later sued it to try to win a big shareholder stake in it. At the same time, he set up a series of largely unsuccessful computer-related firms. Some of those ventures have been in and out of bankruptcy, with creditors in one case settling for 20 cents for every $1 owed, according to court records. Then he moved to Oregon and began dabbling in real estate in both Oregon and California.

Musumeci's big break in real estate apparently came with a California deal in the late 1990s when Arlie & Co. bought a former Jesuit college for a reported $18 million, then sold it two years later for $30 million to parks agencies. Using that windfall, Arlie barrelled into the Lane County real estate market.

Through the years, Musumeci time and again has headed into court to settle disputes - sometimes with spectacular success. The county courthouses in the San Francisco Bay Area have files crammed with lawsuits involving Musumeci, many centering on back-and-forth allegations of fraud, conversion and breach of contract. Almost all have been closed, settled or dismissed.

One unsettled case followed Musumeci from California. A San Mateo County Superior Court judge in 1994 found Musumeci guilty of fraud and deceit relating to profits in a stock sale scheme, according to court documents. Bruno Andrighetto, a longtime friend and business partner of Musumeci who filed the lawsuit, was awarded a $220,000 judgment, plus interest. Andrighetto, who has yet to collect, entered the judgment in  Douglas County Circuit Court in 1994.

Arlie's most significant ongoing local lawsuit is against Dexter  businessmen Norman and Melvin McDougal. The McDougals earlier this year sued Arlie in Lane County Circuit Court, and
Arlie sued them in Santa Clara (Calif.) County Court. At issue in both lawsuits are profits from the sale of three parcels of land  in Santa Clara County.

Musumeci scored a big courtroom success last year in California, when a jury handed Arlie a multimillion-dollar award in a lawsuit the company had brought against a California developer. The jury found that the developer had improperly  interfered with Arlie's plans for the former Jesuit college property. Due to the unavailability of some court files, the exact amount of the judgment is unclear, and it also is not clear whether it has been paid.

A soft spot for horses.  Once Musumeci and Suzanne Arlie moved to Oregon in about 1991, Musumeci quickly earned friends and foes. They settled in the Elkton area in Douglas County before moving several years ago to a rural subdivision outside Eugene. In Elkton, they bought a ranch, named it Dark Horse Farms Inc. and bought and bred rare Friesian horses.

Arlie, a former technical writer, told The News-Review in Roseburg in 1992 that she had long wanted to own a horse ranch. "I didn't have the means to do this, but John did," she said. Arlie told the newspaper that Musumeci was a venture capitalist.

Some people in Elkton said Musumeci had a habit of not paying small obligations until being threatened with litigation. In Douglas County, Arlie & Co. has been either a plaintiff or defendant in nine civil or small claims court cases involving sums as small as $80 and up to $300,000. Most cases were resolved out of court.

Musumeci, in a statement to The Register-Guard, said: "The only companies we did business with in Elkton were the telephone company and the electric company. Our records show that they have been paid." He added: "As a struggling company in the early '90s, we were slow in paying some bills. Today, we pride ourselves in paying all our obligations promptly."

Arlie sold the Elkton ranch last year. Mary Herrera, a Sutherlin veterinarian who cared for the horses, said Musumeci had a soft spot for animals, sparing no expense in their care and keeping them around even when they weren't earning their keep.  "He never nickeled and dimed me, the way a lot of wealthy people do," Herrera said. When she ended their business relationship, it was on amicable terms, she said. Of several business people and private citizens contacted by The Register-Guard in the Elkton area, only Herrera agreed to speak publicly about Musumeci.

Battle for Belknap - In Lane County, Musumeci's first legal dispute started in 1993 and involved the well-known Belknap Hot Springs, about 60 miles east of Eugene. The case mirrored a familiar Musumeci pattern because of its complexity and its murky relationships.

Richard Bowman, a lawyer for several of Musumeci's businesses in California, bought the historic resort in 1991 from longtime owner James Nation for $760,000, giving Nation $200,000 in cash and an IOU for the balance. Musumeci testified that he, working as a consultant, arranged for the deal between Bowman and Nation.

In November 1993, Bowman's company, Belknap Corp., transferred the title to Arlie & Co., though no money changed hands. Nation sued to foreclose on the resort, saying the transfer to Arlie was unauthorized and that Belknap Corp. had fallen about $7,700 behind on property tax payments, according to court documents.

Arlie then transferred the title back to Bowman's company and, three days later, Bowman's company filed for bankruptcy. Bowman said under oath that Musumeci advised him to file for bankruptcy to stall the foreclosure proceedings.

A U.S. Bankruptcy Court judge in Eugene eventually determined the Belknap Corp. bankruptcy filing to be in "bad faith" and dismissed it, which allowed Nation's foreclosure case to resume. In 1995, a Lane County Circuit Court judge ordered Belknap Corp. to pay the balance of the $760,000 owed to Nation, plus  almost $50,000 in attorney's fees, or forfeit the property and any equity. The balance owed to Nation was paid, but by whom is unclear.

Reached at home in Newberg, Nation, 80, still harbors an intense dislike for Musumeci, whom he calls a "conniver." He said the litigation was agonizing and delayed his retirement for years.  Nation says Musumeci was always behind the deal and used Bowman as a front. The then-general manager of the resort testified during the bankruptcy that she got her paychecks from Arlie & Co.

"He's done some awful things to people," Nation said. "If I could hurt him right now, I would."

In a statement, Musumeci said Arlie simply assisted Bowman in the transaction and did not profit from the sale. Deeds on file with the county show Arlie bought the hot springs from Bowman for $910,000 in 1995. Arlie then sold the property the same day to Lane County lawyer Larry Gildea for $1.2 million, according to the deeds. Gildea in turn sold it to the McDougal brothers.

Public profile.  Despite himself, Musumeci can't seem to stay away from controversy, sometimes relishing the limelight, other times avoiding it.  Musumeci for the past four years has regularly sent out news releases announcing Arlie's land acquisitions or sales and often has been available for interviews.

In California, Musumeci was in the news starting in late 1997, when Arlie bought the 1,130-acre Jesuit tract near San Jose  from Hong Kong billionaire Stanley Ho Hung-sen. Musumeci said he planned to develop much of the property into lots for several dozen large estate homes; he advertised parcels in the San Francisco Chronicle for $750,000 apiece.

The land had long been coveted by local residents for a park. Conservationists vowed to fight the development, despite a pledge by Musumeci to preserve several hundred acres as open space.  Environmental groups started negotiating with Musumeci to try to buy the land. That led to more local news stories, plus editorial cartoons that portrayed Arlie & Co. as a long-tentacled octopus and as a masked demon with a chain saw. The cartoons were by Steve DeCinzo, later tapped by Musumeci to be the Gang of 9's anonymous artist.

But Musumeci wasn't always amused by the portrayals. After the cartoons were published in the Los Gatos Times, Musumeci sent a letter threatening to sue the newspaper, said the newspaper's editor, Dale Bryant.

In the battle over his plans for the Jesuit site, Musumeci did file a defamation lawsuit, not against the newspaper, but against Greenbelt Alliance, an environmental group that issued a news release alleging Musumeci had set up shell corporations to hold the property and circumvent land-use planning rules.

"We hadn't been sued for anything before," said Cecil Thompson-Taupin, one of the environmentalists named in the suit. "It was quite startling to all of us at first." A judge ruled the environmentalists' statements were not defamatory and dismissed the lawsuit. The judge also ordered Arlie and Musumeci to pay more than $18,000 in attorney's fees to the Greenbelt Alliance.

 Thompson-Taupin has no hard feelings about the profit Musumeci made on buying and selling the Jesuit site. "Everyone in this part of California made a lot of money on real estate, so it's hard to fault him for that," Thompson-Taupin said.

 PeaceHealth CEO Yordy says Musumeci's California travails are not relevant. Musumeci and Arlie are committed to helping and working with PeaceHealth, Yordy said.  "I think this is going to be a very, very good relationship over  time," Yordy said. "You ought to be really cautious about drawing conclusions from experiences in California and extrapolating those to 2001."
Source: The Register-Guard, By JOE HARWOOD , SUSAN PALMER  Business reporter Joe Harwood can be reached at 338-2364, or  jharwood@guardnet.com. General assignment reporter Susan  Palmer can be reached at 338-2571, or spalmer@guardnet.com.

 
But just how much profit the company is making is impossible to say. Arlie executive John Musumeci argues that he's struck gold on some of his rapid-fire land deals, and that the acreage Arlie has accumulated in Springfield's Gateway area, in west Eugene and elsewhere holds vast long-term potential.

Arlie's holdings are eclectic. The parcel in the news these days is the 75 acres near Gateway that PeaceHealth has picked for its new hospital. Arlie also owns or holds options on 75 adjacent acres.

Other prominent Arlie parcels include 12 acres of industrial-designated land in Gateway and the vacant former Movieland theater in west Eugene, with 10 acres of parking lots and fields, the biggest vacant commercial parcel on that side of the city.

Arlie has accumulated a host of income properties, too: retail strips, low-rent apartments and the like.  In the past five years or so, Arlie and its affiliates have gone from virtually no Lane County holdings to property worth about  $30 million.

To do this, Arlie has taken out big stacks of loans, many of them short-term notes. From an investor's perspective, Arlie has gone on its Lane County buying spree at an odd time: the peak of the local real estate boom.

Now that Arlie is trying to find buyers or tenants - Arlie's "For Sale" and "For Lease" signs dot Eugene and Springfield - the company faces a rapidly worsening local economy. Amid the national economic slowdown, numerous Lane County employers are laying off hundreds of workers. Many are rethinking expansion plans that would have put land such as that owned by Arlie in high demand.

Musumeci won't talk in detail about Arlie's strategy and finances. But real estate brokers who handle Musumeci's deals admire him. Broker Greg Buller, who has worked with Musumeci for a dozen years, says Musumeci has bright long-term hopes for Lane County real estate, given Oregon's land use laws, which limit the amount of land available for development.  Source: The Register-Gaurd, by Christian Wihtol.

Lane County real estate. In the late 1990s, companies controlled by Chinese gambling tycoon Stanley Ho Hung-sen spent almost $3 million buying five pieces of real estate in Lane County, according to property records. In each case, Ho bought the parcels from Arlie, which is run by Lane County residents John Musumeci and his wife, Suzanne Arlie.

Musumeci this summer in a written response to questions from The Register-Guard, said: "Arlie & Co.'s last transaction with Stanley Ho was in August of 1999. ... We have had no further relationship with Mr. Ho." That's not strictly accurate, however. Arlie remains closely involved with Ho's Lane County properties, acting as developer, broker and manager for Ho.

Ho is among the richest men in the world, with a fortune estimated at more than $1.8 billion. His wealth comes from his four-decade monopoly control of gambling in Macau. Ho operates 10 casinos in the former Portuguese colony, which was returned to China in 1999. The 80-year-old also operates luxury hotels in Canada and California.

But Ho also is listed by the Royal Canadian Mounted Police as a suspected "leader/member" of the Kung Lok Triad, according to Canadian news media accounts. The Chinese mafia group is known for heroin trafficking, counterfeiting and controlling parts of the Chinese entertainment industry. The group has strong connections to Asian communities in Canada.

In published reports, Ho has long disputed any links to organized crime. Despite the listing by the RCMP and other Canadian intelligence agencies, Ho makes frequent trips to Canada and is a major contributor to political parties in that country, according to news accounts. Ho executives did not return telephone calls from The Register-Guard.

Arlie's association with Ho dates to at least 1997, when Arlie bought 1,130 acres in Northern California from Hong Kong Metro  Realty Co. Inc., of which Ho is CEO. Arlie bought the site, a former Jesuit college, reportedly for almost $18 million, with  plans to create luxury residential lots. Under fire from environmentalists, Arlie in 1999 sold most of the property to parks agencies for $30 million.

In 1998 and 1999, Arlie sold steep, wooded acreage on Gillespie Butte north of the Eugene Country Club to Hong Kong Metro and another Ho firm, The LEX Co. Since then, Arlie has served as developer of the land, haggling with the city over construction requirements, according to city records. Most recently, the city and Arlie this summer argued over retaining wall requirements. Arlie has not yet built any homes or sold any  lots on the butte.

Arlie in 1999 sold Hong Kong Metro seven vacant industrial acres at West 11th Avenue and Willow Creek Road in west Eugene. Hong Kong Metro remains the listed owner; an Arlie & Co. sign on the property advertises it for sale or lease. Hong Kong Metro also bought from Arlie a small retail building at 15th Avenue and Willamette Street in Eugene. Hong Kong Metro remains the listed owner; tenants in the building say it is managed by Arlie & Co.  Source:  The Register-Guard, by Joe Harwood and Christian Wihtol.

Musumeci's battles could fill several volumes - and they do play a big part in a book by San Francisco journalist Jonathan Littman, "Once Upon A Time In ComputerLand." The book, published in 1987 by Price Stern Sloan Inc. in Los Angeles, chronicles the growth of the ComputerLand retail chain, for which Musumeci worked. Musumeci, in a letter to The Register-Guard, said the book contains many inaccuracies, but he did not elaborate. He declined several requests to be interviewed for these articles.

Littman gives this account of Musumeci's early years: Born in Massachusetts, Musumeci got his first break into the business  world at age 21, becoming a department manager for W.T. Grant Co., a variety-store chain. Later, he switched to car sales, and then sought to franchise employment agencies. At age 25, using the name John Martin, he launched that concept in Boston, and the business eventually boasted 11 outlets, according to Littman's book.

Musumeci then took a shine to the fledgling personal computer  industry. Still using the Martin name, he moved in 1975 to Oakland, Calif., and met Bill Millard, inventor of build-it-yourself  personal computer kits sold through the mail. Musumeci convinced Millard to create computer stores to retail  the machines. Musumeci's idea: sell ComputerLand franchises for $15,000 and collect 5 percent of gross sales. The concept  took off, thanks largely to Musumeci's long hours and aggressive sales tactics. By 1977, Musumeci was director of franchise sales for ComputerLand. Sales were surging; the chain boasted 40 stores, the book said.

But Musumeci and his superiors then had a less-than-amicable parting of the ways. That occurred when Musumeci's boss overheard him tell a potential franchisee that a ComputerLand outlet could sell $200,000 of merchandise in a month, according  to the book. The superior felt Musumeci was making wild promises. (In 1979, a ComputerLand in Kansas City recorded more than $200,000 in gross monthly sales, proving Musumeci right.)

Musumeci left ComputerLand in 1978, getting 1 percent of ComputerLand's closely held stock, which he sold in 1980 for $225,000. But Musumeci remained fascinated with ComputerLand. In 1981, mainly using borrowed money, he paid $300,000 to buy a $250,000 promissory note from a disillusioned early lender to ComputerLand who wanted out of the investment, according to court records in California reviewed by The Register-Guard.  The note entitled its owner to 20 percent of ComputerLand stock - on demand - in lieu of repayment. With the note purchase, Musumeci personally became an owner of roughly 30 percent of the debt.

Through a holding company called Micro/Vest, Musumeci presented the note to Millard, demanding 20 percent of the company. Millard refused. Micro/Vest sued.  As the case made its way through court, ComputerLand's sales  hit $1 billion, largely due to the popularity of the Apple computer and the first IBM personal computer. At the same time, Musumeci launched computer and software firms to compete with ComputerLand. These enterprises - which never produced significant profits - required capital, according to court documents.

To raise money, Musumeci sold shares in his portion of the soon-to-be litigated ComputerLand note, essentially letting investors bet that Musumeci would win. In one transaction, for example, Musumeci sold 2 percent of his share of the note to the owners of a San Francisco garbage company for $600,000, according to court records. The number of investors in the Micro/Vest lawsuit eventually swelled to 55. Musumeci eventually sold most of his share of the note for about $3.9 million, according to court records.

In 1985, an Alameda County, Calif., a jury sided with Micro/Vest, awarding Musumeci and his investors $125 million in  punitive damages plus the 20 percent stake in ComputerLand that they wanted. ComputerLand appealed. In December 1988, an appeals court upheld the verdict. The damage award was later waived in return for an extra 8.5 percent of ComputerLand stock.

But the issue continued in litigation for years.  In September 1988, four months before the appeals court affirmed the Micro/Vest decision, Musumeci shocked his associates by filing the largest-ever bankruptcy in Hawaii - claiming $1.7 billion in liabilities. The personal bankruptcy reorganization filing followed Musumeci's divorce from his second wife. Both were living in Hawaii at the time.

The bankruptcy froze the distribution of the recently awarded ComputerLand shares and protected Musumeci from creditors. Most of the debt Musumeci listed was related to lawsuits and other claims against him and his corporate entities. Several of  those liabilities had already been settled or dismissed before the filing, according to court records. In bankruptcy filings, Musumeci claimed to own 40 percent of the ComputerLand promissory note. Micro/Vest investors asserted he owned only 3 percent to 8 percent.

Court documents suggest Musumeci filed the bankruptcy because he wanted to try to reclaim some of the Micro/Vest shares he had sold to investors, by declaring them underperformed contracts. Musumeci unilaterally rescinded contracts he had executed with three investors who had put up a total of $775,000 to buy into the promissory note, according to court records. Musumeci did succeed in overturning at least one of the  investor contracts, according to court records.  The bankruptcy also allowed Musumeci to delay paying $1 million in federal and state tax liens against him and his companies.

In a December 1988 letter to the largest Micro/Vest stakeholders, attorney Herbert Hafif - who had successfully sued ComputerLand on behalf of Micro/Vest to convert the promissory note to stock - wrote of Musumeci: "He's trying to cheat the bankruptcy court, which involves us, and he's directly trying to cheat everybody he sold or transferred an interest to ... I want to kick his ass, and I want to start the New Year off right."

Musumeci, in a statement to The Register-Guard, said of Hafif:  "I have not talked to Mr. Hafif since 1986. He is entitled to his opinion, but there are a number of local people who would disagree with his assessment."

The bankruptcy was transferred to Oakland from Hawaii and remained active for nearly four years, giving Musumeci time to negotiate settlements with creditors and those who had sued him. Through 1989 and 1990, lawyers for Musumeci and the Micro/Vest investors worked out a pact that would finally allow distribution of the ComputerLand shares. In the meantime, ComputerLand founder Millard had sold his majority stake in the company to a group of private investors. ComputerLand is now a subsidiary of privately held SYNNEX Information Technologies Inc. and has about 200 outlets.

In mid-1991, the 28.5 percent of ComputerLand shares that Micro/Vest had won in the lawsuit started going out to Micro/Vest investors. Musumeci got about 13 percent of the Micro/Vest jackpot, or about 161,000 shares, according to court documents. About 60 percent of that went into a trust for his ex-wife and two children as part of a divorce settlement. Musumeci himself was left with about 68,100 shares. He handed over 10,000 shares to one creditor to settle a claim. Musumeci sold the remainder of his stock for an undisclosed amount. At $17 a share, the price was going for at the time, his stock would have been worth $987,700. He appears to have spent much of his take paying off debts. After settling with creditors, he asked the court to dismiss the bankruptcy.

 But U.S. Bankruptcy Judge Randall Newsome was wary of Musumeci, who had sued several creditors, including attorney Hafif. The judge required Musumeci to sign releases that would make it difficult and costly for Musumeci if he were to try to sue the creditors he had just paid.  "I don't trust your client," the judge told Musumeci's lawyer in spring 1992. "I'm attempting to avoid your client running out of here to launch yet a new wave of lawsuits not only against Mr. Hafif, but against all the people he has already paid. If I were guessing, I would guess that's something he might do."

Newsome warned that if Musumeci were to sue any of the creditors after dismissal, the judge would reactivate the bankruptcy and immediately convert it into a liquidation procedure. Newsome dismissed the bankruptcy in May 1992. Musumeci by then was in the Elkton area with his new wife, Suzanne Arlie. They had moved to Oregon, saying it offers a better climate for breeding Friesian horses. Source: The Register-Guard, by Joe Harwood.