Walloon Lake Water System owners Dennis and Kathleen Hass have agreed to dismiss their lawsuit against four customers and the Melrose Township attorney.
In a Monday March 7 pre-motion conference in the U.S. District Court in Grand Rapids (Western District, Southern Division), judge Janet Neff granted a request to dismiss the lawsuit against Walloon Lake Water System customers Bunny Marquardt, Lena Carlile, Maud Bray, Todd Reeves and attorney Peter Wendling.
“The day this lawsuit was filed, I wrote Mr. Hass’s attorney and told him that it never should have been filed and asked him to dismiss it,” Charlevoix County Prosecuting Attorney Allen Telgenhof said in a Monday March 7 press statement on the case. “He refused then. But, yesterday, I guess they saw things our way.”
The Hasses had filed suit against the aforementioned defendants—and a few others—after Melrose Township and hundreds of customers aimed to negotiate the purchase of the water system.
While a deal seemed to be reached, it ultimately fell apart.
This latest development comes in a long line of notable events surrounding the water system.
The problems all began when some Walloon Lake Water System customers complained of unfair and illegal treatment by the Hasses.
An investigation occurred and the Hasses were accused of activities including forcing new customers to pay for bills owed by previous homeowners, placing liens upon customers’ properties for fees owed by prior property owners, threatening to shut off water supply to customers for reasons other than non-payment of moneys legally owed, and requiring customers to purchase replacement parts directly through the Hasses.
A settlement was ultimately reached between Hass and the Charlevoix County Prosecutor’s Office.
When Walloon Lake resident Lena T. Carlile learned of a settlement between her water provider and the Charlevoix County Prosecuting Attorney’s office, she had hopes of getting back some of the $10,370.40 she claims she was owed.
However, in the wake of the case—which at one point threatened the Walloon Lake Water System owner with charges of extortion and racketeering—Carlile was given a check for $362.80.
“Dropping charges, not negotiating enough for the restitution…. We just feel like we were let down, and then to get a check for $362,” said Carlile in a December, 2013 Boyne City Gazette story. “I mean, I’m (owed) $10,000. We’ve got someone else down the way that was (owed) $4,000 … but we got checks the night that Telgenhof passed out this agreement; he also passed out this form (restitution claim form) for everybody to submit to get reimbursed but yet he’d already negotiated $7,500. He had no idea what was going to come in.”
She added, “So, our question is … what formula did he use to come up with this?”
Telgenhof had said the $7,500 figure was arrived at during negotiations between himself and the attorney representing Dennis Hass.
As part of the settlement, Dennis Hass and the Walloon Lake Water System agreed to an “Assurance of Discontinuance” with Telgenhof on Sept. 10, 2013, wherein they agreed not to retaliate against their customers.
Then, Melrose Township and the majority of Walloon Lake Water System’s estimated 240 customers worked on a deal to purchase the water system from the Hasses for approximately $1.3 million.
A deal seemed to be nearing fruition but then fell apart. Later, the Hasses filed suit against 10 individuals, claiming that the defendants had worked to force the sale against the will of the Hasses.
“Defendants … engaged in concerted action through letters, communications, demands, offers and prosecutions to force plaintiffs to sell their property to the (Melrose) Township. The fairness or not of any offer or purchase is irrelevant. Plaintiffs did not want to sell,” The Hasses stated in their court filing. “These concerted and extra-legal (illegal) attempts by defendants, and each of them, constituted concerted action and conspiracy to violate plaintiffs’ Fifth and Fourteenth Amendment rights.”
They further stated, “Wherefore, plaintiffs Dennis and Kathleen Hass, Walloon Lake Water System Company (WLWS) prays that this honorable court enter judgment against the defendants on their claims of conspiracy to deprive plaintiffs of property without due process of law pursuant to the Fifth and Fourteenth Amendment of the United States Constitution and award them such damages, in whatever amount that is fair, just and equitable, both compensatory and punitive, together with interest, costs and attorney fees.”
No dollar amount was ever disclosed.
The defendants named in the lawsuit included Melrose Township, its attorney Peter Wendling, former Charlevoix County Chief-Assistant Prosecuting Attorney Shaynee Fanara, Charlevoix County Sheriff Deputy Todd Reeves, Charlevoix County Sheriff Deputy William Church, Charlevoix County Sheriff Deputy Robert Scholey, and Walloon Lake Water System customers Bunny Marquardt, Gale Charbonneau, Lena Carlisle, and Maud Bray.
When the Hasses filed suit against some of their customers, Telgenhof called it a violation of the agreement and filed his own suit against the Hasses and Walloon Lake Water System.
“On Dec. 18, 2015, (Charlevoix County 33rd Circuit) Judge Roy C. Hayes issued a scathing opinion agreeing with Telgenhof’s position and ordering both Hass and WLWS to each pay $25,000 in civil fines,” it stated in Telgenhof’s March 7 release. “Hayes called Hass’s actions an ‘obvious’ and ‘blatant violation of the parties’ agreement’ as well as ‘egregious’ and ‘deplorable.’”
According to court documents, Walloon Lake Water System’s attorney has filed for a motion to reconsider the judge’s decision.
“I am confident the court was correct and the ruling will be upheld,” stated Telgenhof in the March 7 release. “By dismissing the case, Mr. Hass has admitted the suit never should have been filed. I intend to pursue this matter and collect the fines that have been levied.”
According to Telgenhof, the most recent cases were dismissed with prejudice, meaning they cannot ever be re-filed.
The Hass case against Gale Charbonneau has not been dropped because Charbonneau has a counter-claim against Hass that is still pending, Telgenhof stated.