Alabama Supreme Court denies Orem mayor’s appeal of $1M judgment in fraud lawsuit

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OREM — The Alabama Supreme Court has upheld a judgment against Orem Mayor David Young by a circuit court judge who called the mayor a “lynchpin” in a fraud case and ordered him to pay $1 million.

Young, his real estate company Torch13 LLC, and his son were ordered by an Alabama judge to pay more than $1 million in a lawsuit over fraudulent business loans in May of 2022. Young and his son Shawn D. Young are alleged to have persuaded an elderly Alabama man into loaning money that Shawn Young did not repay and instead used for gambling, according to a lawsuit filed in November 2021.

That appeal with the Alabama Supreme Court was denied on Friday, with the court affirming the circuit court’s ruling and offering no opinion.

David Young expressed disappointment in the decision Friday, saying the high court “basically ignored any of the egregious legal issues listed in the 70-page brief filed by my legal team.”

“I have never borrowed money from a private individual in my 67 years of doing business,” he said, reiterating he was not involved in any loans that were made to his son. “Everyone involved clearly knows that, and the court testimony of the plaintiff illustrates that as well. A judge taking a $140,000 debt owed by my son and transforming it into a million-plus judgment makes no sense. I will use every legal option to protect my family from what I see as legal extortion.”

The circuit court ruling followed a 2022 trial. Alabama Circuit Court Judge Pat Ballard said both David and Shawn Young were “extremely lacking in credibility” and “very evasive in their answers to even the simplest of questions,” according to the judge’s order requiring them to repay the loans and pay punitive damages.

In September 2022, the judge denied a motion to reduce the punitive damages and said the Orem mayor’s testimony during the trial “displayed an extreme lack of credibility. He was combative, and disrespectful to the proceedings. The indisputable facts and his own documents showed him to be an essential participant in the fraud” and said he conspired with his son to support the fraud.

“David Young, despite a pretense as a businessman, ran Torch13 LLC as a personal tool and piggybank for his joint efforts with Shawn Young, and even went so far as to provide Shawn Young money from Torch13 LLC so that Shawn Young could implement his ‘gambling plan’ at various casinos,” the judge said, calling the Orem mayor “a lynchpin to this fraud.”

The fraud lawsuit

The Utah real estate company was registered for business in Alabama in 2013, and Shawn Young moved there in 2016 to act as the sole agent for the “house-flipping” company, according to the lawsuit. The Orem mayor employed his son and gave him authority to engage in financial activities on behalf of Torch13, despite full knowledge of his son’s previous gambling addiction, failed attempts at rehabilitation and an arrest for stealing $130,000 from a previous employer, the lawsuit alleged.

In his ruling, Ballard said Shawn Young “has a severe gambling addiction and is financially incompetent.”

Over the course of several years, Shawn Young received loans from a neighbor, 77-year-old plaintiff Ross Gagliano, totaling $285,000. The loans were never repaid, and in 2021, Gagliano sued Shawn Young, David Young and Torch13 in the Circuit Court of Jefferson County, Alabama.

The judge believes David Young had a duty to inform Gagliano that his son had misappropriated and gambled away the loan proceeds. Ballard ruled that David Young “wantonly and with conscious and reckless disregard for the rights of others” sent his son to Alabama to engage in the house-flipping venture, and “fraudulently suppressed” information about his son’s background, which led to further loans being made.

Ballard ruled that David and Shawn Young and Torch13 owe Gagliano compensatory damages of $339,235 and punitive damages of $678,471, for a total of $1,017,706.88.

Shawn Young issued a statement Friday saying it was a “sad day for my father and my family.” He reiterated that his father “had nothing to do with the situation between myself and my old friend.” He said he doesn’t know what the next steps will be, “but I will tell you my father is a fighter and he will fight until justice is served.”

A perjury lawsuit

In January, David Young filed a lawsuit in Utah claiming the Alabama judge relied on false testimony from Gagliano and from Young’s former daughter-in-law Candace Graehl — who was married to Shawn Young until last year and is the mother of three of his grandchildren.

The mayor’s lawsuit claims Gagliano and Graehl knew Shawn Young was unable to pay the loans back and so they “concocted a false theory of Gagliano’s case and ginned up perjured testimony to support it so Gagliano could try and recover from Torch13 and/or (David) Young.”

“In short, they needed a deep pocket into which they could slip their hands and obtain funds to repay Shawn’s loans,” the lawsuit alleges.

The mayor claims Gagliano and Graehl “each had a common financial interest” in providing what he says was false testimony, but doesn’t specify what Graehl’s alleged financial benefit would be. The lawsuit seeks a judgment of $300,000, double damages to be determined at trial, plus costs and attorney fees.

Graehl’s attorney Steven Wall said Graehl denies the allegations made against her. “There is not a basis in fact or law to grant the relief that they’re seeking,” Wall said of the lawsuit.

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Cassidy Wixom covers Utah County communities and is the evening breaking news reporter for

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