By JOHN BURNETT Tribune-Herald staff writer ADVERTISING Attorneys for Big Island Toyota and one of its former top executives gave their opening arguments Tuesday in a long-awaited civil trial. Paul Saito, representing the auto dealer and its owner, David De
By JOHN BURNETT
Tribune-Herald staff writer
Attorneys for Big Island Toyota and one of its former top executives gave their opening arguments Tuesday in a long-awaited civil trial.
Paul Saito, representing the auto dealer and its owner, David De Luz Sr., told the jury that Victor Trevino Jr. charmed his way into a position he was unqualified for.
“He’s a nice guy, seems smart to almost everyone … and David De Luz Sr. was very impressed with him,” Saito said.
He said that Trevino signed on in 2003 as the company’s chief financial officer even though he had no background in finance.
“He never took an accounting course; he didn’t have an accounting degree and was not a certified public accountant,” Saito said. “The evidence will show that he presented himself as a certified public accountant.” He said De Luz was attracted to Trevino, who graduated from DePaul University College of Law, as a combination accountant/lawyer, and when Trevino assumed the company’s finances, “that’s when things started to go wrong.”
Saito said that Trevino hired CPA Le Pomaski as comptroller and brought in Chicago accountant Kent Whitney to help, but none understood the finances of an auto dealership.
“They absolutely screw(ed) up the books,” Saito said.
He said that Trevino fabricated numbers, fired employees who questioned the figures and left the books in shambles.
Saito said Trevino wanted to be paid bonuses like car salesmen and sales managers and convinced De Luz to make him chief operating officer in addition to his CFO duties and pay him bonuses based on the company’s net income. He said Trevino’s contract required net profits of $2 million a year before bonuses kicked in, adding that Trevino took bonuses in 2006 of $222,000 and $38,000 based on “fabricated projected income of $11 million.” He added that the company made only $1.4 million that year and had never netted more than $2.5 million in the past.
Saito said that for net sales to total $11 million: “Every single car sold on the Big Island times two would have to be Toyota.”
“At almost every step of the way where Mr. Trevino could take money, he took it,” Saito stated.
He said Trevino never returned the money, and that he took two laptop computers, two tower computers and several boxes of records when he quit in late 2006.
Trevino is the lone defendant. Others named in the suit, including Pomaski and Whitney, have settled or their cases have been dismissed.
Trevino’s attorney, Kris LaGuire said his client “denies breaching any fiduciary duty, breaching any contract, converting, or stealing money — which has been alleged. … He denies being negligent.”
“Mr. Trevino was not simply hired as a chief financial officer,” LaGuire asserted. “His role with David De Luz Sr. in his businesses was much broader. And as Mr. Saito indicated, Mr. De Luz … is a self-made businessman. … He’s an entrepreneur. He doesn’t just sell cars.”
LaGuire said that De Luz contacted Trevino in 2002 at the Chicago consulting firm “because he was concerned that his related business entities were in dire financial straits.”
“Mr. Trevino, at the time, had a law degree; we contend he had accounting experience working at places like Anderson Consulting,” LaGuire told the jury.
He said that after Trevino came out to consult with De Luz in 2002, De Luz started calling him at least monthly to try to get him to come to Hilo to work for him. He said De Luz told him he was “having trouble” with the IRS, his dealerships, his other business holdings and his adult children working in the business. He said Trevino resisted for awhile, but eventually gave in and quit his job in Chicago to accept De Luz’s offer.
LaGuire called Trevino De Luz’s “fix-it guy” and said the “motivating factor behind this lawsuit” is that some of De Luz’s adult children “felt threatened” by their father’s and De Luz’s relationship. He added that “the evidence will show that Mr. Trevino made Mr. De Luz a lot of money” and that De Luz knew of and approved Trevino’s bonuses.
“The notion that Mr. Trevino came out here and screwed everything up is nonsense,” he said.
Email John Burnett at
jburnett@hawaiitribune-
herald.com.
