DALLAS – The Texas lawyer once known as “The Strong Arm” allegedly also had sneaky fingers, according to his widow, who claims Brian Loncar hid millions from her with the help of his staff and other attorneys, one of whom is sitting Dallas County Judge Clay Jenkins.
Sue Loncar filed suit on June 26, 2018, in a Dallas County probate court, seeking property and proceeds from Brian Loncar’s estate that allegedly belongs to her.
Brian Loncar died from a cocaine overdose on Dec. 4, 2016, just days after his daughter committed suicide.
Jenkins
Two months into the litigation, the executor of Brian Loncar’s estate, Jenkins, moved to have the case dismissed, filing a plea to the jurisdiction on Aug. 20, 2018.
Following a Feb. 14 hearing, Judge Brenda Hull Thompson granted the plea, according to a courthouse official.
In her second amended petition, filed four days prior to the hearing, Sue Loncar says she helped Brian Loncar build his firm into a multimillion-dollar operation, which, right up to his death, generated approximately a million dollars in revenue per month.
“This massive amount of money allowed Brian to lead an extravagant and luxurious lifestyle,” the suit states. “Unfortunately, some of this extravagant lifestyle involved vices that Brian did not want Sue to know about.
“In order to hide these vices, Brian began to siphon money from the law firm to pay for such vices and other expenses that he wanted to hide from Sue.”
Brian Loncar allegedly hid the money with the assistance of his staff and Texas attorneys that were willing to pay referral fees through shell companies that were non-legal entities.
In her petition, Sue Loncar makes the following accusations:
- More than $900,000 was deposited into a company called KMA Capital, which was controlled by individuals loyal to Brian Loncar. The money “clandestinely funneled” into KMA Capital largely consisted of referral fees paid to Brian Loncar, PC by other attorneys throughout the past decade;
- Brian Loncar also allegedly instructed his staff to “swipe” checks when they came in, amounting to “at least” an additional $942,000 in funds from mass tort settlements paid in a “secretive and clandestine manner;”
- Brian Loncar authorized a number of wire transfers from his firm to third parties, some of which were used to fund property acquisitions. The list includes the following wire transactions: $430,000 on Sept. 16 2014, $403,000 0n May 27, 2015, $516,000 0n May 30, 2013, and $314,000 0n March 28, 2013; and
- In 2015, Brian Loncar received a check for $1,554,560.44 from Jenkins, one of the lawyers who had allegedly diverted funds to KMA Capital. The fee was from cases that settled in 2014. Because Brian Loncar wanted to hide the check, he held onto it and consulted with the check issuer, Jenkins, in an effort to keep the money private.
Jenkins’ attorney, Ted Lyon, told the Record that he and his client “completely deny 100 percent” Sue Loncar’s allegation that Jenkins helped to hide and divert funds.
“Jenkins has been supervised by ethics attorneys,” Lyon said. “All he’s trying to do is protect the estate.”
Sue Loncar believes there is more than just what’s listed in her lawsuit.
“Given the limited information available to Sue, and the substantial amount of funds brought in by the law firm and distributed to or for the benefit of Brian in nefarious ways, it is believed that such assets are only small fraction of the funds hidden by Brian from Sue, which Sue believes occurred until Brian’s death,” the suit states.
In August 2016, a few months prior to Brian Loncar’s death, he and his wife entered into a partition and exchange agreement to divide up marital assets, allowing him to own the firm while she received the liquid funds.
To protect her interests, the agreement provided that Sue Loncar would continue to receive one-half of any distributions from the law firm.
“Although Brian represented to Sue that he had disclosed all of their assets at the time of the Partition Agreement, the Partition Agreement also provided that in the event Brian had not disclosed all assets, Sue Loncar would be entitled to half of all undisclosed assets, and one half of all income,” the suit states.
“Brian intentionally hid millions of dollars in assets from Sue, as described above, and pursuant to the terms of the Partition Agreement, Sue is the rightful owner of half of these hidden assets.
“Brian did this with the assistance of his law firm, Brian Loncar, PC.”
Jenkins was appointed successor independent executor of Brian Loncar’s estate under the terms of a probated will. An estate administration has proceeded in the probate court since Jan. 13, 2017.
Sue Loncar’s ancillary action came nearly a year and a half later, court records show.
The plea to the jurisdiction asserts that the Loncars had “multiple problems and discord” throughout their 23 years of marriage. But rather than divorcing, the parties entered into partition agreements.
In 2016, a declaratory judgment action was filed in the 302nd District Court. A judgment was issued addressing all issues related to the validity of the partition agreement.
Sue Loncar did not appeal the judgment.
“Plaintiff (Sue Loncar) was happy to benefit from the Judgment in terms of receiving mutual funds, an expensive home and all its furnishings, including valuable antiques and personal property, cars, jewelry, and all the other benefits she secured through the negotiated partition process,” the plea states.
“Despite receiving all those benefits, Plaintiff now seeks to attack the Judgment in this Court by arguing that Decedent did not fully disclose his assets during that partition process and that she was somehow defrauded in that process and the resulting judgment.
“What Plaintiff neglects to tell this Court, however, is that she waived any disclosure of the assets both in writing and through her testimony in open court.”
The plea states the judgment is binding and fully dispositive as to what disclosures were required in that process and how those judgment terms were negotiated or agreed to.
“The only way Plaintiff can attack the Judgment that was entered by a properly constituted court is by a direct attack in the 302nd District Court and not by a collateral attack in the probate courts,” the plea states. “This Court has no subject matter jurisdiction over any of the marital assets already awarded to the Plaintiff or her husband as part of the partition process…”
Sue Loncar responded to the plea on Feb. 8, asserting that the plea is a “factual distortion” and that her suit is not trying to “unwind” the partition agreement.
Case No. PR-18-02186-1