United States District Court, M.D. Florida, Fort Myers Division
KATHRYN T. CRAIG and KOR ISLAND PROVISIONS, LLC, Plaintiffs,
ROMAN KROPP, SHERRI KROPP, and DYLAN KROPP, Defendants.
OPINION AND ORDER 
POLSTERCHAPPEL UNITED STATES DISTRICT JUDGE.
matter comes before the Court on Defendants' Motions to
Dismiss (Docs. 11, 14, 21) filed on April 14, 18, and 28,
2017, to which Plaintiffs responded (Docs. 24, 26, 31). For
the reasons set forth below, the motions are denied.
March 1, 2017, Plaintiffs Kathryn T. Craig (Craig) and KOR
Island Provisions, LLC (KOR) filed an eight-count Complaint,
alleging various state-law tort claims and damages stemming
from a business venture gone bad between the parties. The
case was removed to this Court on March 31, 2017, based on
diversity jurisdiction. (Doc. 2). Defendants Roman and Sherri
Kropp (“RKropp” and “SKropp”) are
husband and wife, and Defendant Dylan Kropp
(“DKropp”) is their son (collectively,
“Defendants”). Craig is the sole owner and
manager of KOR. (Id. at ¶ 1).
Complaint alleges the following which the Court accepts as
true at the motion to dismiss stage: In 2010, Craig met and
befriended Defendants. In 2011, Craig formed KOR, a high-end
retail furniture and furnishings store in Sanibel Island,
Florida. (Doc. 2, ¶ 10). In April 2011, KOR, through
Craig, hired RKropp to assist with the opening and operation
of the store. (Id. at ¶ 11). RKropp became a
trusted friend to Craig and RKropp was provided access to the
KOR operating account to assist with the store's
operation. (Id. at ¶ 12). At some point, the
retail store closed.
retail store was closing, RKropp suggested to Craig that they
become engaged in a real estate business where RKropp would
locate suitable properties for purchase, renovation and
re-sale, on Craig's behalf. (Doc. 1, ¶ 13). As
suggested by RKropp, KOR was maintained and utilized for the
purpose of conducting the real estate business, and Craig
provided RKropp with continued access to the KOR account and
authority to conduct real estate deals on behalf of KOR.
(Id. at ¶ 14). RKropp was provided generous
bonuses for his efforts, and as additional compensation,
Craig allowed the Kropp family to reside rent fee in one of
the properties purportedly purchased for KOR, 661 Cardium
Street, Sanibel Island (“661 Cardium”).
(Id. at ¶ 15). Over this time, RKropp and
SKropp became confidantes and very close friends of Craig,
and Craig considered them to be like her own family.
(Id. at ¶¶ 16, 17).
through KOR, purchased several investment properties in Costa
Rica with RKropp's trusted assistance. (Doc. 1, ¶
18). One such property was called “Villa
Santosha.” Craig determined to renovate the
“Villa Santosha” property in Costa Rica so that
it could be used as a luxury rental, and hired RKropp as the
project supervisor, responsible for choosing and hiring the
builder, managing and overseeing the work, handling the
finances, and maintaining the records and budget for the
renovation. (Id. at ¶ 19). As the renovation
progressed and large sums of money were transferred out of
the KOR account by RKropp, Craig became increasingly
frustrated as her requests for information and back-up
documentation regarding the cost of the renovation project
were ignored by RKropp. (Id. at ¶ 20).
2016, Craig began looking into the various business and other
transactions that she had entrusted to RKropp. At this time,
she found that Defendants had grossly abused the trust she
had reposed in them, including the following:
a. RKropp falsely represented to Wachovia, n/k/a Wells Fargo
that he was an owner of KOR, and was thereby able to have the
account statements diverted from Craig and sent to his
address at 661 Cardium.
b. RKropp falsely represented to Craig that he had purchased
the property at 661 Cardium for KOR. Instead, RKropp had used
KOR's funds to purchase the property for $325, 000, but
then wrongfully and willfully arranged to have it placed in
c. Several years later, while Craig believed the Kropp family
was living rent free in KOR's property at 661 Cardium,
RKropp sold the property for $473, 000, without the knowledge
or consent of Craig, and kept the funds for himself. When
Craig learned of the theft and demanded return of the funds
realized by RKropp, he returned only $320, 000, thereby
misappropriating $153, 000.
d. Without Craig's knowledge or consent, RKropp and
SKropp wrongfully and willfully utilized the debit card on
KOR's account to pay for their personal family living
expenses, including without limitation: electricity both for
661 Cardium, and for the home they thereafter rented in
Colorado, paypal, ebay, gas, family travel, substance abuse
rehabilitation for RKropp, cable, telephone, trash service,
sewer, Burberry, J Crew, Saks 5th Avenue, jewelry stores,
hardware stores, pharmacies, hair salons, restaurants, and
itunes. As a result of these unauthorized and unlawful
charges, RKropp and SKropp misappropriated in excess of $265,
e. Without Craig's knowledge or consent, SKropp
wrongfully and willfully utilized KOR's account to pay
the charges on three storage units in her name for a period
of approximately four years, thereby misappropriating
approximately $36, 000.
f. Without Craig's knowledge or consent, RKropp
wrongfully and willfully withdrew or transferred to his
personal account(s) from KOR's account, a total amount
exceeding $820, 000.
g. Without Craig's knowledge or consent, DKropp
wrongfully and willfully withdrew or transferred to his
personal account(s), from KOR's account the sums of $9,
000, and $7, 000.
h. RKropp falsely represented to Craig he had purchased the
first of the properties in Costa Rica (the “beachfront
property”) for KOR. However, RKropp misrepresented to
the legal counsel in Costa Rica and all others involved in
the transaction that he was the purchaser of the property.
KOR's funds were used for the purchase of the beachfront
property, but RKropp wrongfully and willfully arranged the
transaction so that a corporation owned by RKropp and SKropp
took title. Several years later, and before Craig discovered
these fraudulent acts, RKropp transferred title of the
beachfront property to Craig's son. The nature arid
extent of the damages related to these wrongful acts have not
yet been determined.
i. RKropp falsely represented to Craig that the purchase
price of the beachfront property was $1, 225, 000, when the
actual purchase price was $900, 000. After Craig discovered
the discrepancy, RKropp falsely advised Craig that the legal
counselor in Costa Rica was holding the excess funds. These
funds remain missing.
j. RKropp falsely represented to Craig that the purchase
price of the third property purchased by him for KOR in Costa
Rica was $160, 000, when the actual purchase price was $88,
800. The funds relating to this discrepancy remain missing.
k. RKropp represented to Craig that the renovation to the
Villa Santosha property cost $400, 000, but has failed and
refused to provide Craig with a shred of documentation to
justify any portion of these charges. Craig has received
credible information that an entirely new luxury home could
have been built in Costa Rica for the amount purportedly paid
by RKropp on behalf of KOR Island for the renovation to the
l. RKropp falsely represented to Craig that he had purchased
a 2000 Mercedes Benz automobile in Costa Rica (license plate
no. 450300) for KOR to be used in conjunction with the
properties purchased by KOR. Instead, RKropp used KOR's
funds to purchase the automobile for $25, 000, but then