BETHEL – The state of Vermont is suing a New Hampshire couple for illegally soliciting contributions for a digital projector to “save” the Randall Drive-In located in Bethel.
According to authorities, the defendants, identified as Adam Gerhard and Regina Franz, and Capture the Dream, LLC, a company operated by them, violated Vermont’s Consumer Protection Act when they raised money for the projector primarily through a crowdfunding campaign created on Kickstarter.
At least 257 people donated more than $22,000, including several who gave upwards of $500, towards the projector. The projector was used at the Randall Drive-In only for the 2014 season, at which point the defendants took it to a New York drive-in operated by them, according to the report.
“Crowdfunding can be a legitimate way to raise money for a cause, but it is also subject to abuse,” said Attorney General Bill Sorrell. “Those who rip off Vermonters through improper use of crowdfunding can expect to be held accountable for their illegal acts.”
According to court documents, the defendants made misrepresentations and omissions about the future of the Randall Drive-In. Their Kickstarter plea allegedly stated, “rather than have this renaissance season be a Swan Song for the Randall Drive-In, we are asking for assistance” and that “digital cinema now threatens to close down the drive-in for good.”
The court alleges Capture the Dream made these statements despite allegedly knowing the digital projector would not play a role at the Randall Drive-In beyond the 2014 season.
Authorities say the defendants also misrepresented that the cost of the digital projector would be $75,000, and require a down payment of $20,000, when in fact, it cost $36,300 with a down payment of $6,000.
The lawsuit seeks restitution for all persons who were defrauded by the defendants’ solicitations, civil penalties, an injunction preventing further consumer fraud violations, and costs.