July 20, 2018 ( Courtesy of CBC.ca) – Former Edmonton Oilers owner Peter Pocklington still owes the Alberta government more than $13 million from an unpaid 1988 loan for a failed meat-packing plant.
In Arizona, Pocklington and an associate have so far reneged on restitution of more than $5 million US to settle a securities fraud case involving a gold-mining scheme.
And three months ago, the United States Securities Exchange Commission (SEC) charged Pocklington with securities fraud in California for allegedly defrauding investors in his medical-device company and misappropriating funds.
Undaunted by creditors owed millions of dollars and a looming court fight, Pocklington is seeking investors for a new business venture: a cannabis company.
An SEC filing from June lists Pocklington as the manager of Magic Dragon Realty, LLC, a California company that, according to its website, aims to build a 20,000-square-foot “state-of-the-art indoor hydroponics cannabis cultivation facility” near Palm Springs to wholesale premium bud to licensed dispensaries.
The offering is filed under a provision of U.S. federal securities law that allows companies to sell securities without publicly disclosing financial statements and other information.
The filing says Magic Dragon plans to raise as much as $12.5 million US from investors, with an estimated $1.25 million US of that earmarked to pay Pocklington and the company’s other officers.
On its website, Magic Dragon projects $48 million US in net income in its fifth year of operations and encourages investors to be bold entrepreneurial visionaries.
“Imagine being the savvy investor who was there when railroads gained a foothold in America, or when oil companies first found their market, when distillers and brewers could finally serve their customers within the law, or when e-commerce websites first appeared on the Internet,” the website states.
“Now imagine for a moment the next big opportunity.”
But the company clearly doesn’t want to leave the impression that this potential multimillion-dollar pot operation is only about money.
“Magic Dragon Realty, LLC is a company dedicated to the earnest and genuine desire to do good in the world,” the website states, further promising that “we will willingly, transparently and respectfully abide by all regulations mandated and expected in a civil society.”
In an online video, Magic Dragon touts itself as “a company not afraid of questions.”
Through a spokesperson, Pocklington declined an interview request. Magic Dragon did not respond to an interview request. Pocklington’s lawyer in the SEC case, Becky James, also did not respond to an interview request.
Facing securities fraud charges
Magic Dragon’s website touts the business experience of the now 76-year-old Pocklington.
“Peter has either founded or acquired more than 50 companies in the U.S. and Canada in the span of a 50-year career, but he is perhaps best recognized as the former owner of hockey’s Edmonton Oilers and other successful sports franchises,” his website biography reads.
“He has also owned car dealerships, a trust company, several food companies, and was once a candidate for the leadership of Canada’s Progressive Conservative Party,” it continues.
Missing from the Magic Dragon website is any mention of Pocklington’s high-profile bankruptcy or his several brushes with the law over the past decade, including the securities fraud charges filed against him in April by the SEC.
The SEC alleges Pocklington misled investors by failing to fully disclose his role as founder of The Eye Machine, a company that claims it has created a device to treat macular degeneration.
The commission’s complaint says that in order to prevent investors from learning Pocklington controlled the company, he had his lawyer — Lantson Eldred — serve as the “visual front” of the company while he secretly controlled it “from behind the scenes.”
The Eye Machine, now called Nova Oculus Partners, eventually raised more than $14 million US from 260 investors.
The SEC further alleges Pocklington misappropriated more than $600,000 US of that money for his personal use, including “funding his gold mining companies and paying personal legal and credit card bills.”
None of the allegations against Pocklington, Eldred or the other defendants has been proven in court. Earlier this month, Nova Oculus filed a motion to dismiss the SEC’s charges, calling the commission’s complaint a “baseless attack” filled with “one-sided and often misleading allegations.”
Magic Dragon’s website says the company’s co-founder and vice-president, Damian Gerry, is also vice-president of client management and sales for Nova Oculus, which the website calls an “affiliated company.”
Owes Alberta government more than $13 million
Pocklington’s history of legal troubles extends far beyond the recent SEC charges.
In 2013, he and an associate were ordered to pay more than $5 million US restitution to settle a securities fraud case in Arizona.
The Arizona Corporation Commission, the equivalent of the Alberta Securities Commission, alleged Pocklington and his partner told at least 120 investors they owned mineral rights to a mine in Arizona that would soon be producing gold.
The commission said Pocklington and his partner also claimed in newsletters that the investment represented “one of the most lucrative dividends in the mining business” and claimed hedge funds and banks were interested in the project.
“The commission found, however, that the estimates of gold resources on the respondents’ website were not supportable with the methods currently available in the industry,” the commission said in a news release.
Pocklington and his partner agreed to pay the restitution without admitting or denying the commission’s findings.
In 2010, Pocklington was sentenced to house arrest and two years’ probation after he pleaded guilty to lying to the court about his income and assets after he filed for bankruptcy.
In 2007, a judge ordered Pocklington and an associate to pay Florida businesswoman Naomi Balcombe more than $800,000 US after they breached their agreement to buy The Ageless Foundation, Balcombe’s health-product company. That debt is still unpaid and now, with interest, sits at about $1.8 million US.
The same Los Angeles law firm that represents Balcombe also acts for another of Pocklington’s creditors — the Alberta government. The province is still attempting to collect more than $13 million Pocklington owes the government from an unpaid 1988 loan to his former Gainers meatpacking plant.
Pocklington came to be known as “Peter Puck” when he bought part ownership of the Edmonton Oilers in 1976. Under his ownership, the Oilers won five Stanley Cups in the 1980s.
He created enemies among thousands of Oilers fans when he traded superstar Wayne Gretzky to Los Angeles in 1988. He sold the team in 1998 and moved to California four years later.