On Friday, July 6, the Grace Foundation of Northern California filed the suit, including compensatory and punitive damages, against Wells Fargo, Bank of America, the banks’ attorney Tim Ryan and Dwight Bennett, owner of Whispering Pines from where the animals were removed.

In an email sent from Grace Foundation Executive Director Beth DeCaprio, she alleged the banks illegally gave 36 horses to the non-profit group. It does not have legal ownership of any of the horses and cannot legally adopt them out.

“And the foundation does not have the money to continue providing the overwhelming cost of the horses care without assistance, yet no one will help,” she said.

The complaint filed in the Superior Court of the State of California, alleges, “The fraud defendants, and each of them, knew that on Aug. 26, 2011 when they purported to convey ownership of the subject horses to Grace, that ownership of the subject horses could not be conveyed to Grace at least because of Bennett’s bankruptcy filing.”

Bennett had filed bankruptcy Aug. 18.

The complaint also alleges that,“Knowing Grace would not accept the horses without ownership, the fraud defendants, and each of them, lied to Grace and represented to Grace that the transfer on Aug. 26, 2011 included ownership of the horses. The fraud defendants knew that if they did not lie about this critical fact, Grace would not accept the horses.”

In a response, Wells Fargo wrote, “Ms. DeCaprio’s claims against Wells Fargo are completely without merit. Wells Fargo has never owned the Whispering Pines property or the horses that formerly resided there, nor were we involved in the horses being transferred to the Grace Foundation. In fact, in a Lassen County legal document signed by Ms. DeCaprio herself, the Grace Foundation took possession of the horses directly from Lassen County. Despite having no legal obligation to do so, we have provided past grants of more than $20,000 to support the Grace Foundation’s operations. We also recently joined with Bank of America to offer $400,000 in additional grants, which were surprisingly rejected by Ms. DeCaprio. We care deeply about the welfare of the animals, but we cannot force the Grace Foundation to accept our offer of support, nor can we allow these false allegations to go unchallenged.”

Juli Campbell, Assistant Vice President for Corporate Communications for the Northern and Central California Region, said Wells Fargo had no legal obligation to offer the money, rather, “We were doing it out of the goodness of our hearts.”

In August 2011, Grace took 36 horses that, according to court documents, on July 29 were ordered to be surrendered to Lassen County from the court appointed receiver Vicki Lozano.

In April 2011, Bennett also surrendered 20 horses to Grace, but those horses are not part of the lawsuit.

Bennett was arrested in October and is being held to answer to 65 felony charges of animal cruelty.

According to Kelly Sapp, a spokesperson for Bank of America, the bank never owned the property or the horses.

When Grace asked for a $20,000 donation to help care for the animals, Bank of America donated the exact amount requested immediately.

“We worked closely with authorities to ensure the man responsible for these atrocities was charged and will be prosecuted. The allegations that Bank of America fraudulently handed over the Grace Foundation are untrue.”

She said Bank of America learned about Grace’s current financial situation at the end of May and immediately reached out to understand the needs, lend support and offer assistance.

She said, “We have visited the foundation and reviewed information provided by DeCaprio related to these horses in order to understand the best way to help the foundation continue to care for the horses.”

“Even though we have no ongoing obligations with this organization, we offered the foundation a $200,000 donation, but the offer was declined. We truly want to help this foundation and the horses, and are hopeful it will reconsider our offer of $200,000,” she said.

The complaint alleges Ryan and the banks failed to tell Grace how the bankruptcy filing would significantly adversely impact Grace’s ability to take ownership of the horses.”

Grace alleges it did not know about the bankruptcy until after it assumed responsibility for the horses.

Ryan said he could not comment about this specific complaint, as he will be defending himself in the lawsuit.

The complaint also alleges that, “Notwithstanding the bankruptcy and the automatic stay, the receiver, at the request of and for the benefit of banks, purported to grant ‘final disposition’ of the subject horses to Lassen County, which in turn purported to relinquish the animals to Grace. The receiver also purported to enter into a protective custody agreement with Lassen County regarding the other animals, and the county then purported to enter into an agreement with Grace.”

The complaint said, “The banks and Ryan knew that the receiver had no such authority to enter into these agreements, yet they allowed this to proceed.”

Ryan said, “The court- appointed receiver carried out a valid court order wherein the court ordered her to release the animals to the County of Lassen. The receiver never relinquished the horses into Grace’s possession. Rather, the County of Lassen relinquished the horses into Grace’s possession. The order to release the animals to the County of Lassen was entered on July 29, 2011, three weeks prior to the bankruptcy. The Honorable Judge McManus of the Eastern District of the United States Bankruptcy Court agreed that the county acted within its authority in removing the horses from Whispering Pines on Aug. 26, 2011. The judge’s affirmation of the removal occurred on Sept.2, 2012, in open court. Judge Giordano of the Lassen County Superior Court also approved the removal of the horses notwithstanding the bankruptcy as a valid act under the county’s police power. This approval was stated on the record on Aug.19, 2011.”

The Sept. 2 court record quotes McManus,“The automatic stay does not stop the exercise of police and regulatory powers. So, if the county is the one who came in onto the property and said these horses need care, and directed the turnover, then there’s nothing I can do about that

Of the situation, Grace said it in its complaint that, “Had Grace known on Aug. 26, 2011 that it did not own the horses, that its efforts to manage these horse would be severely limited, and that the banks would refuse to provide sufficient financial support for the horses, it would have never accepted the horses.”

According to DeCaprio, 22 mares were pregnant, but only 14 of the foals have survived. Eight foals required plasma. She said the vet bills are almost $20,000 a month.