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Damascus businessman sues federal agents

Posted: June 24, 2014 - 4:15pm

John Stacks of Damascus, owner of Mountain Pure Water, says a lawsuit his company and several employees have filed against federal agents will show the agencies were in the wrong when they raided his plant in Little Rock in 2012.

The lawsuit claims that agents of the Office of the Inspector General of the Small Business Administation and the Internal Revenue Service violated the Fourth Amendment rights of employees of the Mountain Pure Water bottling plant when the agents “conducted a SWAT team raid” with drawn weapons and went on to detain and interrogate employees.

A judge recently denied the defendants’ motion to dismiss the lawsuit, giving Stacks hope for a landmark victory.

“People need to be held accountable when they get to a point of such extreme overreach,” he said.

Tim Dudley, attorney for Stacks, said the defendants have 30 days to appeal the decision, and an appeal would take a year to resolve. He added the government is immune from litigation, but a Supreme Court decision said a citizen could sue a federal officer for a violation of constitutional rights.

He added, “There are very few cases that deal with a SWAT raid when the government has no reason to believe that anyone at the location they are searching is armed or dangerous or drug dealers or gang members or anything of that sort.”

The IRS investigation stems back to a small business disaster loan Stacks obtained in 2009. He has been charged with making false claims when he said a 2008 tornado destroyed $500,000 worth of company equipment stored at his farm in Damascus. He was indicted last year by a Federal Grand Jury on 11 counts of money laundering and fraud.

Stacks says he has cooperated with the IRS every step of the way and that the charges against him are without merit.

“I look forward to my day in court in September,” he said. “To this day, we’ve never been late on a payment.”

Formerly the CEO of HomeBank of Arkansas, Stacks has taken a leave of absence per FDIC guidelines, he said.

“People hear these things and see it as there’s a possible wrongdoing within HomeBank, and nothing could be further from the truth,” he said. “HomeBank is a very well-run, good and honorable institution. With anyone under indictment, (the FDIC has) the authority to request you to take a leave. I went ahead, rather than fighting it, even though I didn’t think they had the right to do so. I’m still the principle stockholder.”

He said of Mountain Pure Water, “Our Little Rock plant is in a receivership. The primary entity that has loaned us money has taken ownership. We have lost so much money as a result of the raid and the indictment that it was impossible to generate income. Simmons Bank has taken ownership, and we’re hopeful there will be a new owner in the near future so those employees can continue on. We’ve laid off approximately 100 people who are off work today because of this type of government action — good people who worked there for many years.”

In response to the government raid, Stacks and several of his employees appeared in an online documentary called “Rampant Injustice” that features a re-enactment of the para-military-style raid. Duncan Outdoors of Conway and Tennessee-based Gibson Guitar also appear in the documentary, with their leaders saying similar events happened at their businesses.

Stacks said he has talked to many other businesses who have experienced the same thing, but most of them were too afraid of retaliation by the IRS to be mentioned by name in the documentary.

“When we have a government entity that we’re so afraid of, something’s wrong,” he said.

(Staff writer Rachel Parker Dickerson can be reached by email at rachel.dickerson@thecabin.net or by phone at 505-1236. To comment on this and other stories in the Log Cabin, log on to www.thecabin.net. Send us your news at www.thecabin.net/submit)

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fdsjfsdjfsda543543543
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fdsjfsdjfsda543543543 07/08/14 - 09:26 pm
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You break the law, you get

You break the law, you get treated like the criminal you are. If some dude with a pot plant gets the SWAT team raiding his house, your sorry rear end deserves one two. Just cause your crime is white collar (and you're also white) doesn't mean you get special white glove treatment by the police.

Hey buddy, even the EPA and even HUD have SWAT teams. With the proliferation of guns in society and every Tom, Dick and Hairy wanting to or actually packing heat, law enforcement is going to make sure they aren't outgunned. Especially when confronting the local hillbilly/redneck "outdoor vehicle" dealership, your old wrinkley self doesn't stand a chance against a load of men in black with automatic weapons.

Waaa Waaa!! What a bunch of cry babies!

conwaygerl
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conwaygerl 07/09/14 - 08:20 am
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wow

So much for innocent until proven guilty.

And sounds like he's also guilty of being white.

The poor sap was born that way, you know.

mikeng1994
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mikeng1994 07/09/14 - 09:23 am
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"And sounds like he's also

"And sounds like he's also guilty of being white."

Have you not apologized today for being female, white and conservative? Look at how the lady is West Virginia is being grilled by the left.

lachowsj
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lachowsj 07/09/14 - 09:18 pm
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Innocent until proven guilty

Conwaygerl, presumption of innocence is a legal concept that applies to criminal trials only. It does not mean that the rest of us cannot have and express our own opinion. And in my opinion, he's guilty as all get out.

Bad boy
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Bad boy 07/10/14 - 06:45 am
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John.

I know him. I'd say he is innocent and your jealous. A man goes into business and makes good money every never will be hates on him. I was indited by a Federal Grand Jury in 2004. Handed that right back to them. Innocent. Everyone charged is not a sure guilty. Only blind stupid people think that.

Elmer Fudd
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Elmer Fudd 07/10/14 - 09:45 am
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Bad Boy

That is why I do not like the Booked section in the LCD. If you are in it you are conceived as guilty by many.

mikeng1994
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mikeng1994 07/10/14 - 10:15 am
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I love the booked. Does

I love the booked. Does anyone else make up stuff about what they are thinking when the picture was taken? It's better than the sports page.

conwaygerl
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conwaygerl 07/10/14 - 06:50 am
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Thanks matlock, err lachowsky

"presumption of innocence is a legal concept that applies to criminal trials only."

I wasn't aware money laundering and fraud charges were civil matters.

Your knowledge of law is impressive.

lachowsj
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lachowsj 07/10/14 - 06:58 am
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Thanks again for the compliment

And I'll try to explain it so you can understand. The idea of innocent until proven guilty is that a judicial system and jury will presume innocence until there is evidence to the contrary. We as citizens sitting outside the courtroom have no such legal obligation. So we get to express our opinions as we choose. It has nothing to do with civil vs. criminal. It has to do with courtroom vs. real life.

Now do you get it?

conwaygerl
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conwaygerl 07/10/14 - 08:51 am
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right

And we "citizens" are privy to all information and evidence in criminal trials before the trial, thus are able to make an informed verdict.

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