Business Journal: Dunmore Sale Prompts Lawsuit

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(Sacramento, CA)
Wednesday, December 5, 2007
RBC Centura Bank has filed a lawsuit against Dunmore Homes and Michael Kane, who bought the troubled homebuilder two months ago for $500. RBC filed the lawsuit alleging fraud on Nov. 7; Dunmore Homes followed by filing for bankruptcy protection the next day. Dunmore Homes has assets worth $280 million — but liabilities of $250 million, including $39 million to RBC. Dunmore Homes representatives would not comment, but in a court document say the $500 sale would allow former company president Sidney Dunmore to receive a possible tax refund of $11 million.