After our story last week about a judge’s $657,000 decision against Joshua Allen in the Amarillo Walk-On’s Sports Bistreaux trial, Lubbock Lights took a deeper dive into documents and interviewed one of the attorneys involved.
We found some interesting information:
- Dak Prescott, Dallas Cowboys quarterback, lost money in his Walk-On’s investment. The other Walk-On’s investors were not happy with how Prescott became involved.
- Claims Allen commingled funds between Ferrum Capital and the Amarillo Walk-On’s.
- This gives Ferrum Capital victims more information as part of their effort to recover the millions of dollars they lost.
Last week’s ruling at a glance
State District Judge John Grace signed a judgment Wednesday granting more than $657,000 to Jeffrey Tait Crow and Raiderland Holdings (owned by Chance Britt) after the Walk-On’s corporate office took back its franchise rights from the Amarillo location.
Britt and Crow originally sued Allen and Johnny Qubty in 2023 and Qubty settled out of court before the trial.
Tait recovers:
- $150,000 judgment
- Less $35,000 settlement from Johnny Qubty
- Equals $115,000 net judgment
- Plus prejudgment interest of $16,422.94
- Total of $131,422.94
Raiderland recovers:
- $600,000 judgment
- Less $140,000 settlement from Johnny Qubty
- Equals $460,000 net judgment
- Plus prejudgment interest of $65,691.78
- Total of $525,691.78
Crow and Britt pleased
The judge found Allen “breached” his duty to the investors of WTX WO (parent company of Amarillo Walk-On’s). But he did not find enough evidence for securities fraud in the Walk-On’s case.
Ed Price, who represented Jeffrey Tait Crow and Raiderland Holdings (owned by Chance Britt), disagreed.
“The judgment should also have found securities fraud,” he said.
LubbockLights.com asked Price how Crow and Britt reacted.
“They’re pleased that they got a judgement. Now we’ve got to see if we can satisfy it,” Price said.
What are the chances of collecting money?
“It’s a good question. We’ve got to start looking for assets, so that’s our next step. … I guess we’re going to have to hustle and get in line because everybody else is after [Allen] too,” Price said.
Dak Prescott
Court records show Dak Prescott invested $2 million.
Court records consistently indicated Prescott was merely an investor like Crow and Britt. There were no allegations of wrongdoing against Prescott.
Price explained Prescott’s investment.
“He purchased some interests from entities owned by Johnny Qubty and Josh Allen, and as a result, ended up owning interest in WTX WO, WO Metroplex – all the different entities,” Price said.
Allen and Qubty were planning locations in several Texas cities. Each location would have its own company – such as WO Metroplex, WO McKinney, Waco WO, WO Colony, Las Colinas WO and others.
Price described Prescott as part owner of “all of the Walk-On’s entities of which Qubty and Josh Allen owned interests.”
For the other investors in WTX WO, that was a problem.
“None of the limited partners authorized the admission of Dak Prescott into the Limited Partnership as required by the Partnership agreement,” court records said.
It needed two-thirds approval from the WTX WO partnership owners. That did not happen, Price said.
But worse, court records said, “There are documents showing that $1.7 million went from Dak Prescott to Allen, Qubty and entities they controlled.”
In other words, the money did not go to the restaurant.
Allen attorney Nick Olguin disputed that claim saying there was no evidence Allen took money for his personal benefit.
“The ‘Dak Prescott’ sale was wholly authorized by the partnership agreement, and it was not necessary to get the consent of the limited partners,” Olguin wrote in support of Allen.
News articles from 2021 indicated Prescott got a 20 percent stake in numerous Walk-On’s locations in Texas.
It’s not clear from those articles if Prescott invested once or more than once in Walk-On’s franchises. For example, none of the articles mentioned Prescott at the same time with Allen and Qubty.
LubbockLights.com reached out to the communications team for Prescott. They in turn passed along our request to the Walk-On’s corporate office.
An email from Walk-On’s said, “We are unable to provide comment on pending litigation.”
Timeline
- In June 2016, NRN.com (Nation’s Restaurant News) reported Walk-On’s announced an agreement for the DFW market with “Lubbock entrepreneurs Johnny Qubty and Josh Allen, who are already franchisees.”
- A year later, fsrmagazine.com reported, “Qubty and Allen plan to open five Walk-On’s locations throughout the DFW area over the next several years.”
- In 2018, court records said Allen and Qubty formed WTX WO to operate planned Walk-On’s franchises in Amarillo and El Paso. They solicited investors including Crow and Britt.
- In 2020 the Walk-On’s location in Amarillo opened. (El Paso did not open.)
- Allen’s attorney, Nick Olguin, told LubbockLights.com that because of COVID-19, the Amarillo location did not perform well. Britt disagreed. Click here to read our previous story.
- In 2021, Raiderland (owned by Britt) requested a return of its initial investment and was told no. According to the lawsuit, Allen and Qutby “escrowed” or took $3 million out of the business.
- In June 2023, Walk-On’s terminated the franchises. The Amarillo location was taken over and operated by the Walk-On’s corporate office, and “WTX WO ceased operations.”
The Ferrum connection
Allen, Michael Cox and Brooklynn Chander Willy were indicted this month in San Antonio for three conspiracy counts and one count of securities fraud – all related to Lubbock-based Ferrum Capital. They were allowed to post bond while the criminal case proceeds.
Numerous lawsuits accused Ferrum of running a Ponzi scheme. While the indictment did not use the term Ponzi scheme, it said Ferrum took $67 million from victims. Many of them were from Lubbock and San Antonio.
Ferrum is related to the Walk-On’s lawsuit for a couple reasons including Quball and WO Metro, two companies Allen and Qubty started.
“Quball got $821,000 from Ferrum. … WO Metro got $1,275,000 from Ferrum,” according to one of the documents Price submitted in the lawsuit.
Price said he was able to get WTX WO bank statements as part of the lawsuit.
“Ferrum was one of those entities that was mentioned in those bank statements,” Price said.
He claimed Allen commingled money from WTX WO and Ferrum.
Price said he asked Allen during a deposition, “It is true that you took at least $13 million out of the Ferrum entities?”
“And he responded by invoking the Fifth. Therefore, the court was entitled to make an adverse inference that that statement was true,” Price said.
Olguin did not respond to a request for comment for this story. He did comment for our previous coverage, saying Allen did nothing wrong – as it related to Walk-On’s.
Olguin filed a document before the judgement in defense of Allen.
“There is no proof of co-mingling of funds. … Any claim of co-mingling is nothing more than speculation. … There is no evidence that Defendant took money for his own personal gain,” Olguin wrote.
Allen and Qubty put up $5 million, Olguin argued. They, just like the other investors, lost money. Olguin stressed the idea the poor performance at the Amarillo restaurant was no one’s fault.
“In 2020, the COVID pandemic took a toll on the food industry and the COVID pandemic could not have been predicted,” his document said.
