- 1 -

IN THE SUPERIOR COURT OF FULTON COUNTY

STATE OF GEORGIA

CIVIL DIVISION

MATTHEW WHITLEY, ) JURY TRIAL DEMANDED)

Plaintiff, ))

v. ))

THE COCA-COLA COMPANY, ) CIVIL ACTION NO: _____________STEVEN HEYER, STEVEN )VONDERHAAR, TOM MOORE, )JACK WILSON, MIKE OERTLE, )AND BRIAN HANNAFEY )

)Defendants. )

PLAINTIFF’S ORIGINAL COMPLAINT

Plaintiff Matthew Whitley hereby files his original complaint

and states:

JURISDICTION

1. This Court has subject matter jurisdiction pursuant to

GA Const. Art 6, § 4, I, OCGA § 9-4-2 et seq., and OCGA § 16-4-6.

2. This Court has personal jurisdiction over the parties

pursuant to OCGA § 9-10-91.

3. Venue is proper pursuant to OCGA § 9-10-31.

PARTIES

- 2 -

4. Plaintiff Matthew Whitley is a citizen of the United States

and a resident of Dacula, Gwinnett County, Georgia. He is 37 years

old.

5. At all times relevant to this lawsuit, plaintiff was, until

March 26, 2003, employed by defendant The Coca-Cola Company (“TCCC”).

Most recently, until being illegally and extortionately fired,

plaintiff was the Director of Finance - Supply Management in the

Fountain Division of defendant TCCC.

6. At all relevant times, plaintiff worked for defendant TCCC

in Atlanta, Fulton County, Georgia. He spent 11 years employed by

defendant TCCC.

7. Defendant The Coca-Cola Company is a Delaware Corporation

headquartered in Atlanta, Fulton County, Georgia. The defendant may

be served with process by delivering a copy of the Summons and

Complaint to its registered agent for service, C.T. Corporation

System, 1201 Peachtree Street, N.E., Atlanta, Georgia 30361.

8. Defendant Steven Heyer is the Chief Operating Officer of

defendant TCCC.

9. Defendant Steven Vonderhaar is the Vice President and Chief

of Internal Audits for defendant TCCC.

- 3 -

10. Defendant Tom Moore is the President and General Manager

of the Fountain Division of defendant TCCC.

11. Defendant Jack Wilson is the Senior Vice President for

Fountain Operations of defendant TCCC.

12. Defendant Mike Oertle was the Vice President for Supply

Management for the Fountain Division of defendant TCCC, until on or

about April 2003 when he retired.

13. Defendant Brian Hannafey was until a recent promotion the

Director of Finance for the Fountain Division of defendant TCCC. At

all relevant times, defendant Hannafey was the direct supervisor of

plaintiff Matthew Whitley.

STATEMENT OF FACTS

Summary: the Defendants’ Racketeering EnterpriseAnd Sale of Drinks with Metal Residue in Them

14. Over the past five years, plaintiff Matthew Whitley

repeatedly identified to defendant TCCC’s senior management –

including the individual defendants – various illegal and fraudulent

schemes and discriminatory misconduct in the Fountain Division.

15. The illegal activities included: (a) the promotion and

sale to children of frozen-uncarbonated beverages that defendant TCCC

knows contain metal residue that may be potentially harmful; (b) a

$65 million fraud on the Burger King Corporation ratified by members

- 4 -

of defendant TCCC’s Board of Directors; (c) the intentional

overstatement of defendant TCCC’s revenues and gross profits by

- 5 -

$750 million annually; (d) the use of off-the-books slush funds and

illegal money-laundering to materially falsify another publicly-

traded company’s financial information in order to cover-up a failed

$50 million project highlighted in defendant TCCC’s last two annual

reports; (e) illegal price discrimination against customers and

unfair competitive practices totaling nearly $1 Billion; and (f) the

continued intentional discrimination by defendant TCCC against

African-American and Hispanic employees.

16. The defendants conspired to and ran the Fountain Division

as an illegal racketeering enterprise. They executed their illegal

activities using theft, fraud, and deception to cheat shareholders,

customers, and competitors; the defendants used extortionate threats,

intimidation, and fear against TCCC employees to coerce their

complicity in the racketeering enterprise; and the defendants

obstructed justice to cover-up their crimes, influence potential

witness, conceal the availability of information from official

proceedings, and hinder and prevent the communication to law

enforcement of information relating to the commission of these

offenses.

17. When plaintiff Matthew Whitley reported these illegal

activities to senior TCCC management, including defendant Heyer, the

- 6 -

plaintiff was simply trying to protect the customers, shareholders,

and employees of defendant TCCC, including the illegally-

discriminated against minority employees.

18. Nevertheless, the defendants illegally conspired to and

maliciously used lies and extortionate intimidation, fear, and

coercion to ruin plaintiff Matthew Whitley’s career, destroy his

professional reputation, and punish him and his family emotionally

and psychologically – all as part of the defendants’ continued

operation of the Fountain Division as a criminal enterprise through

a pattern of racketeering activity.

I. DEFENDANT TCCC’S PATTERN OF ILLEGAL RACKETERRING ACTIVITIES

A. Introduction

19. During the past five years, plaintiff Matthew Whitley

repeatedly challenged management for, among other things:

(i) Crooked Accounting Practices at defendant TCCC to HidePotentially Harmful Products, Inflate and Misstate itsTrue Financial Performance in Violation of S.E.C. Rules . These include the fraudulent inflation of volume numbers,routine use of off-the-books slush funds, creation offictitious assets, hiding expenses in the purchase priceof unrelated assets, and refusal to write down impairedassets, all in willful disregard of GAAP to inflateprofits, conceal gross capital mismanagement, skirtcapital-funding controls, sugar-coat potentially dangerousproducts, and hide the failure of high-profile projectslike the iFountain dispenser – which defendant TCCC hasfraudulently highlighted as a “success” in its 2001 and

- 7 -

2002 Annual Reports – and Frozen Uncarbonated Beverages.

(ii) Defendant TCCC’s Continuing Participation in aConspiracy to Falsify Material Financial Information ofAnother Publicly-Traded Company . For more than two years,defendant TCCC and Lancer Corp. have been covering up aniFountain slush fund by intentionally falsifying materialfinancial information about Lancer’s revenues. Thatinformation has been filed with the S.E.C. and relied onby Lancer’s shareholders;

(iii) Defendant TCCC’s Successful Marketing Fraud on theBurger King Corp. and Its Franchisees (Some of Whom areNow Bankrupt) to Knowingly Induce Their Investment of MoreThan $65 Million in the Failed Frozen Carbonated BeverageSnack Concept . In early 2000, defendant TCCCintentionally fabricated marketing results to swindleBurger King into proceeding with a national marketingcampaign to promote defendant TCCC’s frozen carbonatedsnacks as a way to increase traffic. As a direct resultof defendant TCCC’s fraud, Burger King bought about $32million of additional FCB equipment, spent nearly $10million more to aggressively advertise the product, andpaid TCCC another $30 million for syrup. All told,defendant TCCC’s fraud cost Burger King and itsfranchisees more than $65 million. The Audit Committeefor defendant TCCC’s Board of Directors learned about thefraud but did nothing to remedy it – except watch idly asdefendant TCCC promoted the scheme’s organizer and leader,John Fisher, for his “success” at Burger King’s expense. Burger King and its franchisees finally stoppedaggressively promoting FCB snacks because – as a truthfulmarketing report would have told them at the start – FCBsdo not increase traffic.

(iv) Defendant TCCC’s Use of “Payola” Annually Totalin g$750 Million in Unsubstantiated and Disproportionate“Marketing Allowances” to Overstate Net Operating Revenuesand Gross Profits and to Bribe Fountain Division Customersto Stay with defendant TCCC . For years, defendant TCCChas doled out more than $1 billion in marketing allowances

- 8 -

to Fountain Division customers purportedly to fund theirrequired promotion of Coca-Cola products. In fact, as thedefendants well knew, its customers pocket most of thecash instead of spend it on marketing. The payments havebeen little more than “bribes” to keep the customers fromchanging to Pepsi. And what the customers do not know isthat defendant TCCC illegally discriminates among themwith disproportional payments in violation of Federalanti-trust and unfair competition laws. Most important,however, because defendant TCCC intentionally refused toaccurately account for these payments as “rebates,” TCCCwillfully and materially overstated its net operatingrevenues and gross profits by $750 million per year inviolation of S.E.C. Staff Accounting Bulletin No. 101. Defendant TCCC has knowingly and intentionally beenmisleading investors about its market share, growth rate,and productivity, not to mention is use of bribes to keepcustomers.

(v) Defendant TCCC’s Ongoing Disparate Treatment ofMinorities in the Fountain Division, Compared to WhiteMales, Accused of Code of Conduct Violations . Remarkably,even though defendant TCCC paid about $190 million inNovember 2000 to settle its historic Title VII race class-action case, the Fountain Division’s discipline decisionshave continued to reflect naked racism against African-Americans and Hispanics.

20. These facts prove one thing, if nothing else. Investors,

customers, and consumers cannot trust TCCC when it comes to numbers

– revenue numbers, expense numbers, asset numbers, marketing-survey

numbers, safety numbers, market-share numbers, efficiency numbers,

and earnings numbers.

21. In the face of rampant corporate illegality at defendant

TCCC, plaintiff Matthew Whitley tried to protect the shareholders,

- 9 -

employees, and customers of defendant TCCC. So the defendants purged

him – destroying his career, ruining his reputation, and stealing his

financial future.

B. Defendant TCCC’s Culture of Dishonesty

22. In defendant TCCC’s the Code of Conduct, it states that all

employees to “act with honesty and integrity in all matters.” In

fact, “integrity” is one of defendant TCCC’s nine core values. And

the Code of Conduct demands that “[e]very company financial record

. . . must be accurate, timely, and in accordance with the law.”

These simple injunctions rightly echo state and federal prohibitions

against fraud and the S.E.C.’s insistence that the financial records

of publicly-traded companies comply with generally accepted

accounting principles – especially in the post-Enron era. (Attached

as Exhibit A and made a part of this complaint for all purposes

pursuant to OCGA § 9-11-10(c) is a copy of defendant TCCC’s Code of

Business Conduct.)

23. Plaintiff Matthew Whitley is a man of uncompromising

integrity, as his performance reviews consistently observed. He

regarded these elementary principles as his Holy Grail. He acted

accordingly. The defendants saw them as a punch-line for stockholder

meetings. And, sadly, the defendants acted accordingly.

- 10 -

1. Crooked Accounting Practices at defendant TCCC to HidePotentially Harmful Products, Inflate and Misstate TCCC’s TrueFinancial Performance in Violation of S.E.C. Rules.

a. Defendant TCCC Conceals Metal Residue in Drinks and Refuses toWrite-Off Impaired Assets

24. Defendant TCCC has been selling Frozen Uncarbonated

Beverages to children and adults throughout the United States,

knowing those drinks contain metal residue that may, on information

and belief, be potentially be harmful to kids. Defendant TCCC has

known about the problem since at least January 15, 2003. And

defendant Heyer, the COO of defendant TCCC, has known since at least

February 4, 2003. Nevertheless, defendant TCCC has refused to notify

the consuming public and intentionally refusing to write-off impaired

assets over the past several months.

25. Generally Accepted Accounting Principles require that

“impaired” assets be written down from their historical cost basis

to their fair market value. An impaired asset is one whose value on

the books may not be recoverable. The underlying premise for GAAP’s

treatment of impaired assets is that worthless or substantially

devalued assets on a balance sheet create a false snapshot of the

company’s true financial picture. An accurate tally of assets and

write-offs is crucial in determining a company’s net worth,

- 11 -

debt/equity ratio, and earnings-per-share, just to mention a few

formulas by which investors measure financial risk.

(1) Metal Residue in Frozen Uncarbonated Beverages

26. Defendant TCCC developed Frozen Uncarbonated Beverages

(“FUB”) dispensing equipment for the Planet Java product line. FUB

equipment leaves metal residue in the drinks that may, on

information and belief, be potentially harmful. Such metal residue

would not good for kids or adults. As defendant TCCC has secretly

admitted, the metal residue results from a manufacturing defect in

the equipment. Defendant TCCC has known about the metal-residue

problem since at least on or about January 15, 2003. Defendant

Steven Heyer, the COO, learned about the problem on February 4, 2003.

27. But defendants TCCC and Heyer have kept the consuming

public ignorant about FUB’s potential dangers because defendant TCCC

has never disclosed them to consumers. Nor has defendant TCCC ever

disclosed to the consuming public that its FUB contains metal

residue.

28. The manufacturer of the FUB equipment is the Lancer Corp.

Currently, defendant TCCC is carrying about $6.72 million of “zero-

turning” FUB equipment inventory on its books (1,050 units @ $6,120

each). That inventory has been near “zero-turning” since January

- 12 -

2002. The problems with FUB are numerous, serious, and apparently

unfixable, however. Defendant TCCC has decided that no new

placements will occur until defendant TCCC can certify there is no

risk of metal residue in the drinks. And the equipment suffers a 70

percent “out of box” failure rate. And sales force has no desire to

sell the product. And 7-11 Hawaii and Wal-Mart canceled their FUB

programs because, on information and belief, the product tastes bad

and did not come close to meeting defendant TCCC’s sales forecast.

29. Defendant TCCC even tried to give away FUB dispensers but

no customers were interested. During the life of the FUB project,

sales were expected to be 1,000 units per year. But three years of

actual sales have totaled only 119 units through March 13, 2003 – a

96-percent shortfall in sales estimates.

30. Defendant TCCC recently accrued a $2 million expense

purportedly to research FUB’s failure. But in truth and in fact, as

defendant TCCC well knows, the impairment problem is at least 4.5

times bigger than this $2 million deduction.

31. If TCCC honestly applied GAAP – not to mention leveling

with the consuming public that FUB has metal residue in it – then

defendant TCCC would have to write off all of the FUB inventory and

- 13 -

incur a total expense of more than $8.9 million ($6.72 in inventory,

$1.4 million owed to Lancer for outstanding purchase orders, and an

R&D penalty of $796,000).

32. The truth is that defendant TCCC is once again putting

profits over the public’s right to know and also delaying recognition

of a material expense, covering-up another failed high-profile

project, and inflating earnings by artfully amortizing the FUB

problem.

33. Plaintiff Matthew Whitley repeatedly advocated complete

compliance with GAAP’s impairment rules for the FUB problem, most

recently on February 26, 2003. Exactly 30 days later, defendant TCCC

fired plaintiff Matthew Whitley.

34. In addition, plaintiff Matthew Whitley reported this

fraudulent scheme to defendant Heyer, defendant TCCC’s Chief

Operating Officer, on January 31, 2003 and again on February 4, 2003.

Seven weeks later, defendant TCCC fired plaintiff Matthew Whitley.

(Attached as Exhibit F and made a part of this complaint for all

purposes pursuant to OCGA § 9-11-10(c) are documents of defendant

TCCC that detail its fraudulent FUB “write-off” scheme, including its

secret admission that FUB contains metal residue.)

(2) The iFountain IS System

- 14 -

35. A critical part of the iFountain concept – beverage

dispensers that use information technology - was its Information

System to manage resource planning. The iFountain IS system sits on

defendant TCCC’s balance sheet as a $30 million work-in-progress.

In fact, as the defendants well know, implementation for the IS

system was scheduled to occur in 2001. Every deadline associated

with its implementation has been missed because, on information and

belief, the system does not work. Defendant TCCC, on information and

belief, stopped trying to salvage the system in October 2002.

36. Under GAAP, the IS system is impaired and needs to be

written off as a $30 million expense.

37. And without the IS System, the entire iFountain project –

especially given the need for off-the-books slush funds to sustain

it, as discussed below in Part I(b) – should be written off. Such

a write-off would require defendant TCCC to recognize a loss of

approximately $70 million.

38. Plaintiff Matthew Whitley made the point about the IS

system’s impairment, and iFountain’s failure, to defendant Heyer,

defendant TCCC’s Chief Operating Officer, on January 31, 2003 and

again on February 4, 2003. Seven weeks later, defendant TCCC fired

plaintiff Matthew Whitley.

- 15 -

b. Defendant TCCC creates Off-the-Books Slush Funds to ConcealiFountain’s Failure

(1) Background

39. Several years ago, senior management for defendant TCCC’s

North America Fountain Division (“CCNAF”) eliminated most of its

dispensing equipment suppliers, choosing instead to align itself with

two primary vendors. One vendor is IMI Cornelius, Inc., the American

subsidiary of a British-based international engineering company

called IMI plc, which also supplies PepsiCo. The other vendor is the

Lancer Corp., based in San Antonio, Texas, a company that trades on

the AMEX. Lancer supplies more than half of defendant TCCC’s

fountain dispensers, and substantially all its sales are derived from

or influenced by defendant TCCC.

40. Defendant TCCC chose Lancer to play a critical role in the

development of a computerized soft drink dispenser called iFountain.

Unfortunately, the project has proven a miserable bust.

41. iFountain broke its budget twice. Sales have lagged far

below projections for several reasons. The price is too high. The

technology -- on defendant TCCC’s books at $30 million – does not

work. Service events far outstrip the repair rate for legacy

dispensers. Installation costs are enormous compared to legacy

dispensers.

- 16 -

42. iFountain dispensers have proven so bad that several

customers have demanded they be removed and replaced with legacy

dispensers. And two customers, Ryan’s Family Steakhouses Inc. and

Darden Restaurants, which initially agreed to purchase iFountain,

have refused any further installations after experiencing the

product’s poor performance. In fact, defendant Jack Wilson – the

Senior Vice President for Coca-Cola Fountain Operations – detailed

a long list of the serious problems with iFountain in an August 20,

2002 letter to a Ryan’s senior vice president, Allen Shaw.

(2) Creation of the Slush Funds

43. By at least on or about late 2000, senior management,

including defendants Moore, Wilson, Oertle, and Hannafey, realized

that the iFountain project was failing badly in the marketplace.

They knew one problem was the price: an iFountain dispenser cost too

much for CCNAF customers and delivered too little value.

44. Senior management, including defendants Moore, Wilson,

Oertle, and Hannafey needed a way to lower the wholesale price so

CCNAF’s sales force could aggressively negotiate a reduced retail

price with end-users.

45. Their answer was to create off-the-books “slush funds” –

which continue today. To execute the scheme, defendant TCCC has

- 17 -

secretly diverted money to Lancer and IMI Cornelius to covertly

“buydown” the wholesale unit price of each iFountain dispenser.

46. This mirage of lower prices on defendant TCCC’s books let

senior management fulfill three critical objectives. Lower prices

have let the defendants sustain the illusion of iFountain’s potential

-- hence, the project’s emphasis in defendant TCCC’s last two annual

reports. Lower prices have given the sales force more flexibility

in the field (although sales remain pathetic). And defendants Heyer,

Moore, Wilson, Oertle, and Hannafey were able to keep their jobs by

hiding iFountain’s failure.

47. The slush funds have been generated two ways. First – and

this method may have involved only Lancer – the defendants directed

Lancer to fabricate at least one invoice to TCCC for a fictitious

asset totaling $400,000. (There was likely a second phony invoice

for $233,747.) Lancer received the cash, and TCCC began receiving

a lower price on the iFountain dispenser.

48. Second, the defendants willfully directed both vendors to

secretly overcharge defendant TCCC for the high volume legacy

dispensers – 2.13% for Lancer and 2.81% for IMI Cornelius. The

secret overcharges were then captured for the slush fund, tracked,

and applied as needed to substantially lower the vendors’ respective

- 18 -

wholesale unit prices on the much lower volume iFountain dispensers.

49. The use of overcharges and fictitious assets has allowed

the defendants to conceal the scheme in a blizzard of invoices. What

is more, the defendants laundered the slush funds through TCCC's

books by hiding them in yearly depreciation entries. They knew that

by creating the false impression that defendant TCCC was purchasing

assets, the overstated price of each piece of legacy equipment and

the cost of the bogus asset – the slush funds themselves – would be

capitalized over 8.3 years. By tying the slush fund’s financing to

depreciable assets, senior management decreased the risk of detection

by spreading the cost of the fraud over time.

50. The masterminds of this scheme were: (a) defendant Jack

Wilson - Senior VP of Fountain Division Operations; (b) defendant

Mike Oertle - VP for Supply Management; (c) defendant Brian Hannafey

– Fountain Division Director of Finance; and other individuals.

51. But in a real fit of stupidity, defendants Wilson and

Oertle, along with TCCC employees Derrick Davis and Danny Lesser, and

Lancer’s management memorialized their agreement to create a slush

fund to reduce the cost of iFountain dispensers. The agreement took

the form of a cover letter and attachment, called “iFountain Price

- 19 -

Buydown and Repayment Agreement,” from Lance M. Schroeder of Lancer

to Derik Davis at CCNAF. Schroeder’s letter, dated March 14, 2001,

was mailed from Texas to Georgia. Copied on the letter was, among

others, defendant Oertle, Gary Paisley - Vice President Engineering,

and Ron Sprouse of CCNAF and Chris Hughes, Lancer’s COO.

(a) The Phony Invoice and Bogus Asset

52. The iFountain slush fund was jump-started by Lancer’s

submission of at least one phony invoice paid by defendant TCCC. At

defendant TCCC’s direction, Lancer fabricated a $400,000 invoice for

a fictitious asset called “engineering, design, plumbing, electrical

of a complete manufacturing line for the production of iFountain

dispenser.” The Lancer invoice was numbered “MAR 30100792” and dated

March 8, 2001. The invoice was sent to the attention of Derik Davis

by, on information and belief, the U.S. mails.

53. Paul Phillips authorized payment of Lancer’s phony invoice

on April 27, 2001. Defendant TCCC paid the invoice under “PO# misc-

2665.” Carol Rush executed the PO. Lancer then booked TCCC’s

$400,000 in its own “off-the-books” financial records for May 2001

under the heading “Manufacturing Equip. Buydown Funding.” (CCNAF

likely directed Lancer to submit an earlier bogus invoice in April

2001 for $233,747, reputedly for iFountain Beta Units. Defendant

- 20 -

TCCC apparently disbursed those funds as well because they also

appear in Lancer’s off-the-books financial records.)

54. Of course, Lancer mailed the false invoice at defendant

TCCC’s direction to cover up the true purpose of the $400,000

payment. There was never a manufacturing-line asset, only a slush

fund.

(b) CCNAF’s Legacy Overcharge Scam

55. The defendants’ second way to fill the slush funds held by

Lancer and IMI Cornelius was the “overcharge” scam on legacy

equipment. Lancer agreed to give CCNAF a $1,633,747 price reduction

(or “undercharge”) on the first 3,000 iFountain dispensers. But this

“price reduction” was not a real reduction in any true sense of that

phrase. In fact, as the defendants well knew (including defendants

TCCC, Moore, Wilson, Oertle, and Hannafey), defendant TCCC was

obligated to repay Lancer dollar for dollar in real time – only the

repayments would be made covertly.

56. The defendants agreed with Lancer that the first $633,747

of the “price reduction” would come from defendant TCCC’s payment of

the two phony invoices. Those two payments constituted the initial

buydown on the iFountain dispensers’ price. Lancer would recoup the

- 21 -

remainder of its sham price reduction through a 2.13 percent

overcharge on all legacy and iFountain equipment purchases.

57. To track the slush fund in 2001, Lancer maintained a

detailed set of its own off-the-books financial records. Among the

entries on Lancer’s secret ledger were: (i) “iFountain Beta

Dispensers Buydown Funding,” which had $233,747 booked in April 2001;

(ii) “Manufacturing Equip. Buydown Funding,” which had $400,000

booked in May 2001; (iii) “Legacy & iFountain Overcharge @ 2.13%,”

with monthly amounts booked in 2001 ranging from $12,137 to $43,303;

(iv) “Current Interest Owed to KO @11% [which happens to be the

internal rate of return TCCC typically uses to assess its

investments]; and (v) “Outstanding Balance owed to (Lancer)/KO,”

which totaled $841,230 in defendant TCCC’s favor on December 31,

2001.

58. In January 2002, defendant TCCC and Lancer took steps to

conceal the slush fund from Lancer’s outside auditors. To hide their

scheme, defendant TCCC agreed in writing that: (i) Lancer would keep

the 2001 buydown funds it then held – which totaled about $1 million

of defendant TCCC’s money; (ii) Lancer would receive an additional

$500,000 of defendant TCCC’s money throughout 2002 via a legacy

overcharge; and (iii) Lancer would have no obligation to repay or

- 22 -

issue credit to TCCC for the unused overcharge amounts, which thus

eliminated the need to continue the Buydown status reporting process

in early 2002. This illegal arrangement was memorialized in letter,

dated January 9, 2002, from defendant Oertle in Atlanta to George

Schroeder in San Antonio, Texas.

(c) Current Status of the Legacy Overcharge Scam

59. Even today, defendant TCCC still fills the iFountain slush

funds. Only now defendant TCCC’s senior management, including

defendant’s Moore, Wilson, and Hannafey (and defendant Oertle before

his March 2003 retirement), quaintly call the overcharge a “temporary

portfolio management strategy on all legacy equipment purchases.”

In fact, the only temporary strategy at work here is to keep hiding

iFountain’s failure.

60. Defendants TCCC, Heyer, Moore, Wilson, and Hannafey (and

others at the company) are willfully misusing defendant TCCC’s assets

and cheating defendant TCCC’s shareholders to conceal a fraudulent

scheme that involves off-the-books slush funds.

61. As of December 31, 2002, the net balance in defendant

TCCC’s iFountain slush funds totaled at least $3.2 million ($2.1

million to Lancer and $1.1 million to IMI Cornelius). The slush

funds probably approximate $3.5 million by now.

- 23 -

62. On Lancer’s books, the slush fund is laundered through its

inflated revenues for legacy dispensers, making Lancer look

materially more profitable than in fact it is. IMI Cornelius

launders its share of the iFountain slush funds the same way.

63. On defendant TCCC’s books, the slush funds are laundered

through asset purchases. Every payment by defendant TCCC to the

slush funds is hidden in a legacy-dispenser purchase. Because

defendants TCCC, Heyer, Moore, Wilson and Hannafey (and defendant

Oertle before his March 2003 retirement) cause the payment of

inflated prices to conceal the scheme, defendant TCCC has

fraudulently overstated the value of its legacy equipment by at least

approximately $5 million. (The difference between TCCC’s overstated

inventory and the slush funds’ net balance represents the total

buydown on all iFountain dispensers purchased to date.)

(d) Internal Cover-up of the iFountain Slush Fund

64. On or about February 2002, plaintiff Matthew Whitley

learned about the iFountain slush funds. He reported these

staggeringly obvious Code of Conduct and GAAP violations to Chris

Hutchings, then the Vice President of Finance for CCNAF. Hutchings

and defendant Vonderhaar, Vice President and Chief of Internal

Audits, conducted a two-day sham investigation.

- 24 -

65. The conclusions reached by Hutchings and defendant

Vonderhaar are no surprise given TCCC’s culture of dishonesty: (i)

no one violated TCCC’s Code of Conduct; (ii) Lancer would be allowed

to keep $1 million of defendant TCCC’s money; and (iii) CCNAF would

write-off the fictitious $400,000 asset.

66. Hutchings told plaintiff Matthew Whitley that the rationale

behind his and defendant Vonderhaar’s conclusions was two-fold.

First, they saw the slush funds as “creative price management.” More

soberly, Hutchings admitted, “we cannot let this get to the papers.”

(Attached as Exhibit B and made a part of this complaint for all

purposes pursuant to OCGA § 9-11-10(c) are documents of defendant

TCCC that detail the creation and management of the iFountain off-

the-books slush funds with Lancer Corp.)

(e) Plaintiff Reports the Fraud to Defendant Heyer

6 7 . Plaintiff plaintiff Matthew Whitley reported this

fraudulent scheme to defendant Heyer, defendant TCCC’s Chief

Operating Officer, on January 31, 2003 and again on February 4, 2003.

(Attached as Exhibit C and made a part of this complaint for all

purposes pursuant to OCGA § 9-11-10(c) are a series of e-mails

between defendant Heyer and plaintiff Matthew Whitley, including his

report to defendant Heyer about the iFountain Slush Fund, the Burger

- 25 -

King Fraud, the Metal-Residue problem with frozen-uncarbonated

beverage that has been concealed from the public, and defendant

TCCC’s continuing willful discrimination against African-Americans

and Hispanics.)

68. One week later, defendant Hannafey gave plaintiff Matthew

Whitley his first “Substandard” performance review in 11 years with

defendant TCCC. In the draft review document he prepared, defendant

Hannafey rated plaintiff Matthew Whitley as “substandard” for

complaining that senior TCCC management refused to follow Generally

Accepted Accounting Principles (“GAAP”). But in the final review

document, defendant Hannafey deleted his self-incriminating reference

to senior management’s refusal to follow GAAP. (Attached as Exhibit

D and made a part of this complaint for all purposes pursuant to OCGA

§ 9-11-10(c) are the draft performance review and the final version

of the performance review manipulated and altered by defendant

Hannafey to conceal the defendants’ illegal activities.)

69. Six weeks later, on March 26, 2003, defendant TCCC fired

plaintiff Matthew Whitley, allegedly as part of a company-wide layoff

process. Defendant Hannafey’s decision to give plantiff Matthew

Whitley a substandard performance review counted 50 percent toward

the layoff decision under defendant TCCC’s formula. Notably, the

- 26 -

purported layoff “decision” was made by defendants Oertle and

Hannafey.

c. The iFountain Capital-Funding Scam

70. Like all significant capital projects at defendant TCCC,

the funding for iFountain was approved by the Board of Directors.

As the project moved forward, the need for additional funding became

apparent. A supplementary request was made to and approved by the

Board.

71. But by 2002, on information and belief, senior management,

including defendants Moore, Wilson, Oertle, and Hannafey and others,

knew that the iFountain project could not be finished under the

Board-approved budget. More capital funding was needed. But, on

information and belief, those defendants, and others, believed the

Board would not be receptive to another supplementary funding request

in the tight economic times. And, on information and belief, those

defendants did not want to risk spotlighting the flagging iFountain

project.

72. Senior management, on information and belief, led by

Hutchings and defendants Moore, Wilson, Oertle, and Hannafey came up

with a creative – and fraudulent – accounting solution that rivals

the iFountain slush funds. Hutchings, on information and belief,

- 27 -

decided to play a shell game with the Board members, only no one told

them.

73. What Hutchings and the defendants did, on information and

belief, was fraudulently to inflate the budget for a totally

unrelated Information-System project, called Project Discovery, from

$10 million to $14 million. The defendants’ scheme, on information

and belief, was to shift the extra $4 million to the iFountain

project before the Board spotted his slight of hand.

74. The Board approved the proposed $14 million budget. And,

on information and belief, defendants Moore and Wilson secretly

blessed Hutchings’s move of the extra $4 million of funding Project

Discovery to the iFountain project.

75. Plaintiff Matthew Whitley reported this fraudulent scheme

to defendant Heyer, defendant TCCC’s COO, on January 31, 2003 and

again on February 4, 2003. One week later, plaintiff Matthew Whitley

received his only “substandard” performance review in 11 years with

defendant TCCC. Six weeks later, defendant TCCC fired plaintiff

Matthew Whitley.

d. Defendant TCCC’s Miraculous Ability to Convert Expenses intoProfits

76. Another accounting trick used by defendant TCCC to inflate

profits in tough times is, on information and belief, to convert

- 28 -

expenses into profits. The practice is creative. And the practice

is fraudulent.

77. From an accounting perspective, defendant TCCC’s conversion

scheme operates, on information and belief, much like the iFountain

slush funds. That is, defendant TCCC, on information and belief,

secretly wraps otherwise necessary expenditures to outside vendors,

which should be expensed on defendant TCCC’s income statement, into

the price of new equipment purchased from those vendors. This “wrap

in” is done, on information and belief, by having the vendor inflate

the mark-up on the newly-sold products to TCCC in an amount equal to

TCCC’s would-be expense.

78. Another way defendant TCCC converted expenses into profits

involved the complete fabrication of assets from accrued expenses.

Defendant would book as an asset on its balance sheet something

called “deferred payments,” which were moneys that had been paid to

customers as promotional allowances.

79. So instead of having “expenses” that decrease TCCC’s gross

profits, on information and belief, defendant TCCC creates either

higher priced “assets” on its books, which can then be depreciated

over 8.3 years, or completely fabricated assets that can be amortized

- 29 -

over three years. The vendors, on information and belief, are

satisfied because they receive the money owed them.

80. And, on information and belief, defendant TCCC’s senior

management, including defendants Heyer and Moore, is pleased for two

reasons. Defendant TCCC’s bottom line is, on information and belief,

inflated by keeping large, one-time expenses off of the company’s

income statement. And the company’s then-current balance sheet, on

information and belief, is also inflated because inflated or totally

fictitous assets are booked.

81. With the stroke of a pen, defendant TCCC has invented a new

way to turn expenses into profits. The only hitch is this practice

violates GAAP – not to mention sound corporate governance and even

minimal internal controls -- because, on information and belief, it

misrepresents defendant TCCC’s actual financial performance.

82. Two examples are set forth below in ¶¶ 83-101.

(1) The SHURflo-iFountain Fix

83. As part of the iFountain initiative, defendant TCCC

contracted with a company called SHURflo Pump Manufacturing Company,

Inc. in 1999 to develop the water treatment system (“WMS”) for the

new dispensers. SHURflo is a supplier of other equipment to TCCC.

- 30 -

84. Under the 1999 agreement, SHURflo was required to self-fund

the WMS’s development. Eventually, SHURflo invested $2.26 million

in the project. By December 2001, however, defendant TCCC advised

SHURflo that it had breached the 1999 contract due to a WMS design

problem – including its non-UL electrical status. But even the

equipment’s non-UL status, with its inherent danger of electrocution

to unwitting users, did not stop defendant TCCC from selling 100 of

these hazardous devices to customers.

85. SHURflo demanded in response that defendant TCCC reimburse

its development costs on the ground that defendant TCCC never clearly

outlined the project’s specifications. On or about March 2002,

defendant TCCC assumed the risk of failure and agreed to repay

SHURflo $1.81 million for its engineering development costs.

86. GAAP requires that such payments be expensed because the

payor receives nothing of long-term, amortizable value. But, on

information and belief, defendants TCCC, Moore, Wilson, and Oertle

had a different plan.

87. Defendant TCCC would pay SHURflo the $1.81 million for

engineering design costs associated with the original WMS. But the

method of repayment was a $25.86 markup above SHURflo’s regular price

for the iFountain Backroom Integration package. The pricing to

- 31 -

defendant TCCC was set at a premium for SHURflo to recoup its R&D

costs. And defendant TCCC booked these premium payments not as

expenses but as depreciable assets – hence, the miraculous conversion

of expenses into profits.

88. On or about May 21, 2002, plaintiff Matthew Whitley

reported his grave concerns about this slick accounting gimmick to

his supervisor, defendant Hannafey. Plaintiff Matthew Whitley neatly

summarized the scheme this way: “CCF has asked Shurflo to over bill

us on backroom packages related to CD dispenser installs . . . to

offset the $1.8 mm liability created by our rejection of the WMS.”

Plaintiff Matthew Whitley continued:

This is not dissimilar to the “tooling purchase/buydownfund” scheme I found with iFtn dispenser pricing twomonths ago. I realize that Chris [Hutchings] determinedthat the accounting treatment developed by Mike/Jack/Garyet al. [Mike Oertle/Jack Wilson/Gary Paisley] for iFtndispensers was OK, but I have the same strong concernsabout this latest Shurflo “treatment” if my understandingis proved correct.

89. Plaintiff Matthew Whitley then concluded: “I believe the

$1.8 to be an expense. . . . By agreeing to overstate the cost of

‘backroom packages’ we will be in effect, capitalizing the failure

to perform penalty. This would result in inflated asset numbers, and

understated expenses.”

- 32 -

90. The fallout from the SHURflo “expense-to-profit fraud” was

predictable. Defendant TCCC, on information and belief, wrongly

treated its penalty payments to SHURflo as assets in violation of

GAAP. (Attached as Exhibit E and made a part of this complaint for

all purposes pursuant to OCGA § 9-11-10(c) are documents of defendant

TCCC that detail its fraudulent SHURflo “expense-to-profit” scheme.)

91. And on or about June 2002, at plaintiff Matthew Whitley’s

mid-year review, defendant Hannafey severely chastised him for

questioning Chris Hutchings’s conclusion that the iFountain slush

fund was anything more than just “creative price management.” Of

course, defendant Hannafey never disclosed that he had approved the

iFountain slush fund at its inception.

92. Plaintiff Matthew Whitley reported this fraudulent scheme

to defendant Steven Heyer, defendant TCCC’s Chief Operating Officer,

on January 31, 2003 and again on February 4, 2003.

93. One week later, at plaintiff Matthew Whitley’s last annual

review on February 11, 2003, defendant Hannafey confirmed that

plaintiff Matthew Whitley’s overt challenge to senior management’s

accounting abuses directly contributed to his poor performance grade

for 2002. Defendant Hannafey was, on information and belief, acting

- 33 -

at the direction of defendants Heyer, Moore, Wilson, and Oertle, or

some combination of them.

94. Notably, on or about early March 2003, as part of the

layoff process used by defendant TCCC when preparing to fire

employees in late March 2003, the defendants made sure that the poor

performance grade defendant Hannafey fraudulently and maliciously

gave plaintiff Matthew Whitley made up 50 percent of plaintiff

Matthew Whitley’s layoff assessment score. The defendants wanted to

be sure they falsely and fraudulently created a pretext for

maliciously mistreating plaintiff Matthew Whitley.

(2) Capitalized Marketing Allowances for Bottlers

95. Another example concerns plaintiff Matthew Whitley’s first

taste of defendant TCCC’s underhanded accounting tricks in 1998.

96. Defendant Tom Moore, President of the Fountain Division,

insisted that $27 million worth of marketing payments to Coca-Cola

bottlers – that were supposed to be paid-out in equal installments

over three years – be capitalized over 8.3 years.

97. Defendant Moore, on information and belief, wanted the $27

million capitalized because of mounting profit pressure. Falsely

spreading out those payments would inflate the Fountain Division’s

- 34 -

performance by nearly $5.75 million in each of the first three years.

98. The messenger who delivered defendant Moore’s directive to

plaintiff Matthew Whitley was Mark Peterson, Moore’s executive

assistant. Plaintiff Matthew Whitley told Peterson that GAAP

prohibited such an outlandish approach.

99. Unhappy that plaintiff Matthew Whitley was against

falsifying TCCC’s financial records, defendant Moore, on information

and belief, sent Peterson and Drew Garner, Director of Field Sales,

to TCCC’s Accounting Research Department. They met with Bryan K.

Treadway.

100. After hearing Moore’s rationale, on information and belief,

Treadway agreed to book the $27 million as an amortizable asset to

be capitalized over 8.3 years. (Bryan K. Treadway left defendant

TCCC and landed at a company called Qwest in April 2001, where he

became its Assistant Controller. On February 25, 2003, a federal

grand jury indicted Treadway and others on charges of conspiracy,

securities fraud, and wire fraud for fraudulently inflating Qwest’s

profits by mischaracterizing and accelerating revenues on two

equipment sales in knowing violation of GAAP rules.)

- 35 -

101. When plaintiff Matthew Whitley learned what Treadway did,

he insisted that Chris Hutchings, the division’s CFO, reverse the

entry and initiate a Code of Conduct inquiry. After a good deal of

hand-wringing, Hutchings relented on reversing the entry but refused

to permit an internal investigation into defendant Moore’s

misconduct.

e. Phantom Deliveries and Sales and Unneeded Shipments toFraudulently Inflate Volume Numbers in the Fountain Division

102. Defendant TCCC recognizes revenue in the Fountain Division

based on the volume of syrup shipped. Thus, volume is a critical

indicator of defendant TCCC’s financial performance.

103. Defendant TCCC has employed, on information and belief,

three primary mechanisms to fraudulently inflate its volume numbers,

that is, the amount of syrup shipped to distributors.

(1) Phantom Sales - “Sell To” versus “Sell Through”

104. On or about 2002, on information and belief, defendant TCCC

changed the method by which it measured volume. Defendant TCCC

changed from a “sell to” yardstick to a “sell through” yardstick.

105. “Sell to” measured volume – and hence revenue – based on

defendant TCCC’s sales to distributors. Under this standard of

- 36 -

measure, defendant TCCC simply looked at its actual shipments to gage

volume.

106. “Sell through” measures volume – and hence revenue – based

on the distributors’ reported sales to its customers. In other

words, under this standard, defendant TCCC had to rely on the

distributors’ honest reporting of its sales.

107. Distributors, however, as defendant TCCC well knows, have

an incentive to inflate and fabricate its “sell through” numbers

because, with respect to the distributors’ syrup sales to certain

large customers, defendant TCCC pays the distributors a delivery fee.

This delivery fee compensates the distributors for the fact that

defendant TCCC forces them to sell the syrup to large customers at

cost with no mark-up.

108. Following defendant TCCC’s shift to the “sell through”

method of measuring volume, its reported volume increased on

information and belief by approximately 2 million gallons, which

equals about $18 million in additional revenue.

109. The problem was, as defendant TCCC well knew, the

distributors’ reported sales to its customers exceeded by about 2

million gallons defendant TCCC’s actual deliveries to the

distributors.

- 37 -

110. In other words, defendant TCCC knew that its reported

volume numbers were falsely inflated by about 2 million gallons and

its revenues were fraudulently inflated by about $18 million.

(2) Unnecessary “Early” Deliveries of Syrup at End of FiscalQuarters

111. Defendant TCCC used to recognize sales, and thus revenue,

based on deliveries to distributors under the “sell to” method.

112. At the end of fiscal quarters, to inflate its sales

numbers, defendant TCCC would on information and belief ask its 10

largest distributors to accept “early” delivery of a substantial

quantity of additional syrup – much more than the distributor needed.

113. To induce the distributors to take the deal, defendant TCCC

would give the distributors special payment terms. That extended

payment as much as 90 days to the end of the next fiscal quarter

without any penalty. Normally, defendant TCCC required payment

within 30 days before imposing a penalty.

114. As a result of this scheme to inflate its volume shipped,

and hence its revenues, defendant TCCC on information and belief

overstated its revenues by approximately $10 million per year.

(3) “Phantom” Deliveries of Syrup at End of Fiscal Quarters

- 38 -

115. Defendant TCCC treats a sale of syrup as occurring when a

delivery truck leaves the loading dock, not when the distributor

actually receives the product.

116. To further inflate its volume figures, defendant TCCC would

execute phantom truck deliveries at the end of quarters. Defendant

TCCC would fill its delivery trucks with containers of syrup. And

just before midnight on the last day of the quarter, the fully-loaded

trucks would be ordered to drive about two feet away from the loading

dock.

117. As a result of this scheme to inflate shipments, defendant

TCCC inflated its revenues by on information and belief approximately

$5 million.

2. Defendant TCCC’s Continuing Participation in a Conspiracy toFalsify Material Financial Information of the Lancer Corp.

118. As described above in ¶¶ 39-66, the Lancer Corp. kept a

detailed set of off-the-books records for its share of the iFountain

slush funds. In preparation of Lancer’s 2001 10-K, its outside

auditor, KPMG, reviewed those records and raised questions about the

nature of the “buydown” transactions between Lancer and defendant

TCCC.

- 39 -

119. For KPMG, on information and belief, it was essential to

understand Lancer’s mysterious records because the nearly $1 million

slush fund represented about 54 percent of Lancer’s total cash

balance as of December 31, 2001. The problem was that Lancer had not

booked the slush fund as a “payable.” Doing so would have ruined

Lancer’s debt/equity ratio. To conceal the scheme, Lancer needed a

way to treat the slush fund as income.

120. When KPMG threatened to notify the S.E.C. about the $1

million, Lancer called defendant TCCC (through defendants Wilson and

Oertle). Both sides realized something needed to be done quickly to

keep the lid on what could be an ugly S.E.C. investigation.

121. So they struck a deal on January 9, 2002. With the

blessing of defendant Wilson and Chris Hutchings, defendant Oertle

agreed that (i) Lancer could keep the balance of the slush fund of

$1 million, (ii) Lancer would receive an additional $500,000 in 2002

via a legacy overcharge, and (iii) Lancer would no longer have any

obligation to repay the unused portion of the slush fund, so it no

longer would track the overcharges.

122. Defendant TCCC’s January 9 agreement knowingly aided and

abetted (a) Lancer’s fraudulent accounting treatment of the slush

fund as income, and (b) Lancer’s fraudulent representation in its 10-

- 40 -

K that it had a “$1.0 million gain relating to the cancellation of

a project.”

123. In truth and in fact, as defendants TCCC, Wilson, and

Oertle and Lancer well knew, no project had been canceled – unless

Lancer’s earlier promise to track and repay the unused balance of a

secret off-the-books slush fund is a “project.” As a result,

Lancer’s recognition of the $1 million balance in the off-the-books

slush fund represented more than 71 percent of its net earnings for

fiscal 2001.

124. Defendants TCCC, Wilson and Oertle, and Hutchings, aided

and abetted Lancer’s completion of the accounting fraud cover-up on

February 27, 2002.

125. To further cover-up their accounting fraud, defendants

TCCC, Wilson, and Oertle agreed in writing with Lancer that defendant

TCCC would relinquish its rights to the fictitious production-line

equipment TCCC purportedly purchased on April 25, 2001. This bogus

waiver, on information and belief, placated KPMG’s concerns about

potential S.E.C. violations and stock fraud.

126. Defendant Oertle’s agreement, on behalf of defendant TCCC,

also gave Hutchings and defendant Vonderhaar what they needed to

- 41 -

internally cover-up the slush fund by writing-off the $400,000

“purchase” from defendant TCCC’s books.

127. The slush-fund scheme continues today. Only now, with no

need for tracking, Lancer and defendant TCCC conceal the fraud in

Lancer’s operating revenues.

128. As a result, the defendants are knowingly and intentionally

causing Lancer’s revenues and earnings to be materially – and

fraudulently – inflated. The defendants are knowingly and

intentionally causing Lancer’s true financial situation to be

willfully misrepresented.

129. Lancer’s shareholders are getting a materially false view

of its actual performance because of the defendants’ fraud.

130. Defendant TCCC, Heyer, Moore, Wilson, Oertle, and Hannafey

are knowingly aiding, assisting, and counseling Lancer’s fraud.

131. When plaintiff Matthew Whitley protested the slush fund in

March 2001, he was rebuffed by Hutchings and defendant Vonderhaar.

They called it “creative price management” that needed to be kept

out of the newspapers.

132. And seven weeks after telling defendant Heyer about TCCC’s

participation in a scheme to defraud another company’s shareholders,

plaintiff Matthew Whitley was out of a job.

- 42 -

3. Defendant TCCC’s Successful Marketing Fraud on the Burger KingCorp. and Its Franchisees to Knowingly Induce Their Investment ofMore Than $65 Million in the Failed Frozen Carbonated BeverageSnack Concept.

a. Defendant TCCC Makes a Bad Deal with Burger King

133. On or about April 14, 1999, defendant TCCC prepaid a $400

million 10-year marketing allowance to Burger King, the Fountain

Division’s second largest customer. Defendant TCCC, on information

and belief, typically pays marketing allowances to its customers at

year-end based on the volume of prior purchases, not in advance based

on expected purchases.

134. Defendant TCCC prepaid Burger King $400 million knowing

full well that its decision to give Burger King so much money in

advance of performance carried the risk that actual purchases would

not justify the prepayment. That is precisely what happened.

135. The people responsible for this $400 million prepayment

debacle included, among others, the then-Vice President of the Burger

King Account Team.

136. By on or about late 1999, sales to Burger King had not, on

information and belief, come close to justifying the $400 prepaid

marketing allowance.

137. Defendant TCCC needed a way to increase sales of Coca-Cola

products to Burger King. To increase sales, defendant TCCC needed

- 43 -

to increase traffic at Burger King restaurants. More traffic would

translate into more product sales for Burger King. More sales would

mean more inventory purchases – and that would include Coca-Cola

products. More Coca-Cola purchases would help justify the $400

million prepayment.

138. On or about February 2000, defendant TCCC, through the

Burger King team, came up with a plan. The plan was to hype Frozen

Carbonated Beverages (“FCB”) as a kid’s snack item at Burger King,

which had already invested about $30 million in FCB equipment.

139. To promote the product and, more important, convince Burger

King corporate’s OPS-Tech committee that FCB would in fact increase

traffic, defendant TCCC persuaded Burger King to run a three-week

long test in the Richmond, Virginia market.

140. Burger King’s OPS-Tech committee agreed.

141. Defendant TCCC’s Burger King team knew that Burger King’s

senior management saw the marketing survey’s success as the critical

proof necessary to justify a substantially stepped-up investment in

FCB, not to mention Burger King’s already existing investment.

142. Defendant TCCC’s proposed promotion was that with the

purchase of a “value meal,” the Burger King customer would receive

a coupon for a free FCB. Presumably, if kids liked FCB, they would

- 44 -

buy more “value meals” to get the coupon for the free drink. The

purchase of more kids’ value meals would mean traffic had increased.

143. The benchmark for success then would be the volume of

“value meals” sold in the Richmond, Virginia area.

144. If the test was successful, as defendant TCCC well knew,

Burger King planned to extend the promotion nationally. A national

promotion would mean more syrup sales for defendant TCCC.

b. Defendant TCCC Fraudulently Rigs the Marketing Test

145. Defendant TCCC’s marketing survey went very poorly. Kids

just did not like the product enough to raise traffic.

146. So defendant TCCC’s Vice President for the Burger King told

a TCCC marketing manager to hire a “marketing consultant” to falsify

the survey – rig the results to it appears as though FCB drives

traffic.

147. The marketing manager paid $10,000 of his own money to a

Virginia man so he could take hundreds of kids to Burger King to buy

“value meals” for the sole purpose of falsely inflating the survey

results. Remarkably, the TCCC Vice President for the Burger King

account became angry with the marketing manager for not spending

$20,000 - $30,000 to rig the outcome, instead of just $10,000.

- 45 -

148. Overnight, the marketing results turned around. Defendant

TCCC’s promotion looked like a success. But defendant TCCC knew the

truth that the results were a fraud. Burger King and its franchisees

took the bait.

c. Burger King Spends $65 Million in Reliance on the Rigged TestResults

149. In reliance on the rigged marketing results, Burger King

and its franchisees, two of the largest of which are now in

bankruptcy, committed to (i) a national promotion of Frozen Coke in

over 7,600 restaurants around the country, which (ii) required a

sizeable equipment installation program and expanded syrup purchases.

150. Over the next two-plus years, Burger King and its largest

franchisees purchased approximately 3,800 frozen-carbonated-beverage

dispensers at an installed unit price of about $8,485. They put

nearly $10 million more into advertising and marketing. And they

bought about 4.25 million gallons of syrup from defendant TCCC at a

unit-price of approximately $7.50, to fill the new equipment.

151. All told, because of the fraud, Burger King and its

franchisees have unnecessarily spent more than $65 million on FCB

dispensers, marketing, and TCCC products.

- 46 -

152. Unfortunately for Burger King and its discontented

franchisees, the Frozen Coke program has woefully under-performed

defendant TCCC’s volume forecast by 50 percent.

153. The program’s failure can be no surprise to defendant TCCC

because its forecast was based in large measure on its fraudulent

marketing survey.

154. Because of the program’s very poor results, Burger King has

dramatically de-emphasized its FCB snack promotion. But because of

defendant TCCC’s fraud, Burger King and its franchisees are stuck

with $64 million of over-valued equipment, not to mention being out

$65 million in cash.

c. Warren Buffett, and the Rest of Defendant TCCC’s AuditCommittee, Learn About the $65 Million Fraud, Let it Continueto Increase Revenue, and Allow the Perpetrator to be Promoted

155. On or about March 2001, the marketing fraud on Burger King

came to light in the Fountain Division.

156. Plaintiff Matthew Whitley led a preliminary Code-of-Conduct

investigation that recommended the Vice President’s termination. But

that recommendation was overruled by defendant TCCC’s senior

management, including defendants Moore and Vonderhaar.

157. Instead of firing the Vice President for directing a $65

million-plus fraud on one of defendant TCCC’s largest customers,

- 47 -

those defendants only made the Vice President forfeit 50 percent of

his 2000 bonus and his 2001 stock-option award. And they put a

meaningless letter in his permanent file about the fraud.

158. In accord with TCCC policy, the Vice President’s Code-of-

Conduct violation – the fraud on Burger King – was reported the Audit

Committee of defendant TCCC’s Board of Directors.

159. The Audit Committee is composed of four members: Warren

Buffett, the largest shareholder in TCCC through his Berkshire

Hathaway Inc. with 200 million shares worth about $8 Billion; Peter

Ueberroth; Cathleen Black; and Ronald Allen.

160. Upon hearing the report, on information and belief, Peter

Ueberroth was extremely angry and demanded that the Vice President

of the Burger King team be fired immediately.

161. Warren Buffett, however, on information and belief,

convinced the Audit Committee to reject Ueberroth’s demand for an

immediate firing because such an incident would be potentially

embarrassing for defendant TCCC.

162. Buffett, instead, on information and belief, persuaded the

Audit Committee that defendant TCCC should go forward with its

proposed FCB sales and victimize Burger King and its franchisees,

- 48 -

rather than tell them the truth about the fraudulent marketing

report.

163. Buffett knew, on information and belief, that not telling

the victims would accomplish several potentially profitable

objectives: (a) because defendant TCCC had made a bad business deal

with Burger King, the FCB fraud would help recover some of those

moneys; (b) because Buffett’s Berkshire Hathaway Inc. was the largest

shareholder of defendant TCCC, he would personally benefit from the

fraud scheme because defendant TCCC would be able to recover those

moneys; and (c) because Buffett’s Berkshire Hathaway Inc. owns the

Dairy Queen chain – a direct competitor of Burger King – and the FCB

fraud would cause serious financial injury to Burger King, a company

in serious financial trouble, Buffett’s Dairy Queen investment would

directly and substantially benefit.

164. In short, after hearing a report about how defendant TCCC

had victimized the Fountain Division’s second largest customer

through a $65 million fraud – but a fraud that would substantially

benefit TCCC and Warren Buffett – the Audit Committee did nothing,

thanks on information and belief to Warren Buffett.

165. The Audit Committee took no action against the Vice

President. It recommended no further action by management against

- 49 -

the Vice President. And it took no steps to remediate the fraud

against Burger King.

166. Equally remarkable, after the Vice President cheated Burger

King and its franchisees for defendant TCCC’s benefit, defendant TCCC

promoted him to Senior Vice President for Marketing - Food Service

Division. And TCCC’s Board did nothing to stop it.

d. The Moral of the Story

167. Plaintiff Matthew Whitley reported the marketing fraud on

Burger King to defendant Heyer, the Chief Operating Officer of

defendant TCCC, on or about February 4, 2003. Then he got fired.

168. The Vice President for the Burger King team defrauded a

major customer out of tens of millions of dollars. Then he got

promoted.

169. Plaintiff Matthew Whitley’s report to the COO could hurt

TCCC’s earnings. But the Vice President’s fraud increased TCCC’s

earnings.

170. Plaintiff Matthew Whitley’s report to the COO could hurt

Warren Buffett’s $8 Billion investment in defendant TCCC. The Vice

President’s fraud on Burger King would benefit not only Buffett’s

investment in TCCC, but also his investment in Dairy Queen.

- 50 -

171. Plaintiff Matthew Whitley was honest. The Vice President

was a fraudster.

172. The moral of this sordid story is that defendant TCCC helps

employees who help earnings – “profits make perfect.” Employees who

are not helping earnings are hurting earnings – and TCCC will punish

them. (Attached as Exhibit G and made a part of this complaint for

all purposes pursuant to OCGA § 9-11-10(c) are documents of defendant

TCCC that admit and detail its fraudulent marketing scheme against

Burger King.)

4. Defendant TCCC’s Use of “Payola” Annually Totaling $750 Millionin Unsubstantiated and Disproportionate “Marketing Allowances” toOverstate Net Operating Revenues and Gross Profits and to BribeFountain Division Customers to Stay with TCCC.

173. A critical customer-relations tool at CCNAF is “marketing

allowances.” Suppliers in many industries use marketing allowances

to help customers pay the costs of promoting the supplier’s product,

for example.

174. A customer’s failure to use all or some of the allowance

on advertising as promised requires disgorgement or forfeiture of the

unapplied amount. Marketing allowances are granted to customers

based on some measure of past performance, such as volume.

175. The correct accounting for marketing allowances is

prescribed by S.E.C. Staff Accounting Bulleting No. 101, EITF 01-9,

- 51 -

which give dispositive guidance on recognition of income, and

presentation and disclosure of revenue in financial statements, and

the proper treatment of marketing allowances to customers.

176. The marketing allowance itself is calculated using a

predetermined formula that generally applies to all customers. Equal

application of a standardized formula and a disgorgement penalty

ensure proportional treatment for the customers in accordance with

the Robinson-Patman Act’s prohibition against unfair competition and

unlawful price discrimination under 15 U.S.C. § 13. The Federal

Trade Commission has issued detailed regulations governing

promotional allowances, at 16 C.F.R. § 240.1 et seq., to prevent such

unlawful price discrimination and unfair competition, which are

attached as Exhibit G and made a part of this complaint for all

purposes pursuant to OCGA § 9-11-10(c).

177. The TCCC’s Fountain Division annually awards customers

approximately $1 Billion in purported marketing allowances – and that

number has been growing by about 8 percent per year. Three problems

plague this $1 Billion disbursement.

a. Defendant TCCC Improperly Overstated Net Operating Revenuesand Gross Profits Because No Marketing is Required

178. As defendant TCCC known for at least the past five years,

customers have routinely spent only about 25 percent of their $1

- 52 -

Billion “marketing allowances” on marketing. The remaining $750

million has been pocketed by the customers with TCCC’s blessing.

179. Plaintiff Matthew Whitley repeatedly sent documented

directives to senior CCNAF management that validation of the

payments’ use to market Coca-Cola products was essential.

180. But defendant TCCC’s senior management, including defendant

Moore, President of the Fountain Division, has refused to require

proof that defendant TCCC’s customers use the “marketing allowances”

as required. Defendant TCCC has been getting nothing of legally

recognizable value in return for these payments.

181. Defendant TCCC’s excuse for refusing to require compliance,

according to defendant Tom Moore, is that “the customers are happy.”

And why would the customers be anything else after getting annual

unrestricted payoffs of $750 million.

182. In fact, approximately two years ago, defendant Moore

ordered plaintiff Matthew Whitley to stop auditing the customers’

nonuse of the marketing-allowance payments. Moore’s rationale was,

“we know all about it.”

183. Clear and simple, as defendant TCCC well knew, $750 million

of defendant TCCC’s annual marketing allowances were “rebates.” The

payments went directly into the customers’ cash accounts. Defendant

- 53 -

TCCC booked the payoffs as though the customers spent that money on

marketing TCCC products.

184. But defendant TCCC knew it would not seek evidence of the

critical compliance requirements when the payoffs were made. And

defendant TCCC knew the customers were not using the money to promote

Coca-Cola products. The customers simply kept the money. Defendant

TCCC gets no measurable legal value in return.

185. The payments, from an accounting perspective, subsidized

the customers’ gross unit costs for defendant TCCC syrup. That meant

– as defendant TCCC well knew – the annual $750 million payments were

“rebates” under GAAP.

186. GAAP requires that rebates be booked in a contra-revenue

account. In lay terms, a contra-revenue account offsets, or reduces,

a company’s gross operating revenues. That reduction yields a

company’s net operating revenues. Net operating revenues are then

reduced by the company’s cost of goods sold to determine gross

profits. Consequently, if a company’s net operating revenues shrink,

then its gross profits shrink. Shrinking revenues suggest lost

market share and slower growth. Shrinking gross profits suggest lost

efficiencies.

- 54 -

187. A marketing allowance to reimburse a customer’s advertising

expense, on the other hand, was supposed to be included in general

administrative expenses under GAAP (until on or about January 1, 2002

pursuant to EITF 01-9). Those kinds of expenses are deducted from

a company’s gross profits to calculate its operating income.

Advertising expenses, unlike rebates, reflect nothing about market

share and cost efficiencies.

188. The distinction between a “rebate” and a “marketing-

allowance expense” is vital to investors. A rebate reduces revenues.

Lower revenues suggest a weakness in a company’s product line –

hence, the need to cut prices with a rebate. And by improperly

accounting for a rebate as an expense, thereby inflating gross

profits, the guilty company falsely appears more cost efficient than

is in fact the case. Important valuation ratios used by investors

are distorted. In a word, inflated gross profits mislead investors

about market penetration and productivity.

189. Defendant TCCC, by willfully mischaracterizing the rebate

payments as “marketing allowances,” had been intentionally misstating

– and inflating – its net operating revenues and gross profits by

$750 million per year through 2001, for a total of at least

approximately $2 Billion.

- 55 -

190. While defendant TCCC’s operating income may have remained

unchanged if the defendant had honestly applied GAAP, two of the key

factors in that calculation – net operating revenues and operating

expenses – would have been materially different.

191. Defendant TCCC has knowingly and intentionally violated

GAAP and S.E.C. Staff Accounting Bulleting No. 101 by materially

misstating its net operating revenues, gross profits, and operating

expenses until January 1, 2002, in regard to its customers’ unused

marketing allowances.

192. Defendant TCCC’s violation of SAB No. 101 was material and

significant. Defendant TCCC’s investors should have been seeing a

company whose revenues and general expenses were substantially lower

than reported, on the order of about $750 million annually.

Investors should have been seeing a company with a lower market share

and lower gross profit margins. Investors should have been seeing

a lower sales/fixed assets ratio, lower sales/total assets ratio, and

lower price/sales ratio. What defendant TCCC investors should have

been seeing is a company in deeper financial trouble than it has

admitted.

b. Defendant TCCC‘s Rebate Payments Constitute Unfair Competitionand Commercial Bribery

- 56 -

193. For defendant TCCC’s customers, rebates – that is, the

unspent allowances – inflated their own profits by decreasing their

costs of goods sold. True marketing allowances are profit-neutral

because the payments merely reimburse the customer for actual

marketing expenses already recognized on its books. Such an

accounting treatment is prescribed by SAB No. 101.

194. But defendant TCCC’s lax approach to compliance lets

customers report larger profits. Both defendant TCCC’s customers and

TCCC knew that the customers were pocketing the payments rather than

spending money on Coca-Cola advertising. Defendant TCCC’s willful

inaction turned the allowances into rebates.

195. As defendant Moore said, “the customers are happy” with

this approach. The reason was, on information and belief, because

defendant TCCC’s payoffs result in increased earnings for the

customers.

196. But defendant TCCC knowingly used deception to conceal its

rebates from public and regulatory scrutiny. Defendant TCCC’s

dishonesty suggests an unlawful intent to influence the customers’

choice of suppliers by secretly offering the customers profits, not

just money. These payments then are nothing less than “payola,” or

bribes, to keep the customers using Coca-Cola products.

- 57 -

197. Bribes are not tax deductible under the Internal Revenue

Code. Nor may the fact of their payment, especially on the scale of

$750 million, be withheld from shareholders.

c. The Payments Are Grossly Disproportional in Amount

198. The other problem with defendant TCCC’s marketing

allowances is their disproportionality, in violation of federal law.

199. An essential characteristic of lawful marketing allowances

is that they be proportional among customers. Proportional payments

protect against customers and competitors from unfair competition and

price discrimination in violation of the Robinson-Patman Act and the

Federal Trade Commission’s regulations.

200. Defendant TCCC regularly disobeys this requirement.

201. Instead, defendant TCCC’s approach is to negotiate

individualized arrangements with its customers with no regard for

proportional consistency.

202. For example, on information and belief, McDonald’s – which

has a “most favored nation” clause with TCCC on all pricing issues

– receives one level of marketing allowances based its individual

formula. But Burger King, one of McDonald’s competitors, receives

- 58 -

a different level of marketing allowances based on another formula.

Either McDonald’s or Burger King – just to name two -- is wrongly

receiving a lesser allowance from the standpoint of proportionality.

d. Conclusion: Defendant TCCC Cheated Again

203. Plaintiff plaintiff Matthew Whitley tried to enforce the

requisite standards of lawful conduct by defendant TCCC. Defendants

TCCC and Moore ordered him to stop.

204. By doing so, the defendants – in violation of their

fiduciary duty to TCCC shareholders – fraudulently kept defendant

TCCC’s revenues and gross profits inflated. The defendants’ conduct

also kept TCCC’s customers more profitable, but cheated them

nevertheless with disproportional payments. Thus, the defendants

have been able to continue to engage in unfair competition and

unlawful price discrimation.

5. Defendant TCCC’s Ongoing Disparate Treatment of Minorities andWomen in the Fountain Division, Compared to White Males, Accusedof Code of Conduct Violations.

- 59 -

205. In a landmark settlement for race-discrimination class-

actions, defendant TCCC agreed to pay $192.5 million to a class of

black employees and to fund numerous steps that would prevent future

unlawful discrimination at Coca-Cola.

206. However, as plaintiff Matthew Whitley reported to defendant

Heyer on January 31, 2003, race discrimination continues unfettered

at defendant TCCC.

207. Here are a few examples of how defendant TCCC has handled

different Code of Conduct violations in the Fountain Division since

the landmark settlement.

White Males & Females

(a) Derik Davis (iFountain project manager) – white male

– participated in the creation of the iFountain Slush Fund,

which includes the intentional overcharge of defendant TCCC and

the acquisition of fictitious assets to conceal the scheme, the

inflation of defendant TCCC’s income and assets, and the

material misstatement of another publicly-traded company’s 10-K.

No Code-of-Conduct violation is found on grounds of “creative

price management.”

(b) Shelly Callahan (administrative assistant to Jack

Wilson, Sr. Vice President for Fountain Operations) – white

- 60 -

female – pressured hotels to give her free travel and rewards

points in exchange for booking reservations for her department.

The issue was deemed too “sensitive” by Chris Hutchings for a

Fountain Division audit, so the Corporate Audit Department under

Steven Vonderhaar conducted the investigation. No action was

taken.

(c) John Fisher (Vice President, Fountain Division

Marketing, formerly Vice President of the Burger King Account)

– white male –

i. defrauded Burger King (but made money for

defendant TCCC). He lost part of his bonus and

some stock options. But he lands a promotion

to Senior Vice President of Food Service

Division Marketing.

ii. made a donation to his children’s private school

using TCCC’s funds. He lost 25 percent of his

bonus, but only days later received his

promotion to Senior Vice President.

iii repeatedly billed duplicate expenses on his TCCC

expense reports totaling about $9,500. Tom

Moore and Chris Hutchings overruled plaintiff

- 61 -

Matthew Whitley’s determination that Fisher had

violated the Code of Conduct.

iv. approved a $10,145 expenditure by the Finance

Director of the Burger King Account Team to pay

for a plane ticket to take his sister (not a

TCCC employee or customer) to a World Cup match

in Japan, where the Finance Director

purportedly would entertain Burger King

franchisees. Tom Moore and Chris Hutchings

determined that no Code of Conduct occurred.

v. misappropriated Disney World passes with TCCC

money and traded them for Notre Dame football

tickets for personal use. Fisher is finally

fired – but that was because he stole TCCC’s

money, not a customer’s.

(d) William McCrary (Finance Director, Burger King

Account Team) – white male – with the advance approval of John

Fisher is reimbursed $10,145 for the cost of a plane ticket to

take his sister (not a TCCC employee or customer) to a World Cup

match in Japan, where McCrary purportedly would entertain Burger

- 62 -

King franchisees. Tom Moore and Chris Hutchings determined that

neither McCrary nor Fisher violated the Code of Conduct.

(e) Staci McMillian (Fisher’s executive assistant) --

white female – approved her son’s hiring as a temporary worker

by an administrative assistant, and related wage payments, to

book travel arrangements for Fisher and a subordinate in

violation of anti-nepotism rules. No action was taken.

(f) Defendant Tom Moore (President and General Manager,

Fountain Division) – white male –

i. Diverted $250,000 of defendant TCCC’s money to

a charitable organization he personally favored.

No action taken.

ii. authorized an associate to take an all expense-

paid, non-business trip to Paris, France, with

her spouse. Moore signed off on the expense

report that reported the trip as a “bonus.”

Despite the trip’s nature and Moore’s

intentional failure to report this “bonus” as

taxable income, no Code of Conduct violation was

found.

- 63 -

(g) Defendant Mike Oertle (Vice President for Supply

Management) – white male – participated in the creation of the

iFountain Slush Fund, which includes the intentional overcharge

of defendant TCCC and the acquisition of fictitious assets to

conceal the scheme, the inflation of defendant TCCC’s income and

assets, and the material misstatement of another publicly-traded

company’s 10-K. No Code-of-Conduct violation is found on

grounds of “creative price management.”

(h) Mark Peterson (executive assistant to defendant Tom

Moore) – white male – accepted an all expense-paid fishing trip

to Canada from a TCCC supplier and requested reimbursement for

airfare from defendant TCCC. Despite the Code of Conduct’s

express prohibition on lavish trips absent advance

authorization, no violation is found because Tom Moore approved

the trip after the fact to cover up the problem.

(i) Defendant Jack Wilson (Senior Vice President,

Fountain Operations) – white male – participated in the creation

of the iFountain Slush Fund, which includes the intentional

overcharge of defendant TCCC and the acquisition of fictitious

assets to conceal the scheme, the inflation of defendant TCCC’s

income and assets, and the material misstatement of another

- 64 -

publicly-traded company’s 10-K. No Code-of-Conduct violation

is found on grounds of “creative price management.”

Black and Hispanic Employees

(a) Ms. Reyes (first name unknown) – Hispanic female –

falsified her exception time card. She was promptly terminated.

Her Code violation neither made money for defendant TCCC, nor

was she part of the clubby white-male Fountain Division group

of executives).

(b) Issac Wilkerson – black male – wrote off 44

delinquent receivables without his manager’s approval to improve

the appearance of Wilkerson’s performance. He was terminated

because he had engaged in similar conduct in the past.

(c) Numerous other former employees – black males and

females – billed duplicate expenses on defendant TCCC expense

reports. These employees were terminated for amounts much

smaller than the $9,500 that John Fisher falsified.

6. Defendants Use Intimidation, Threats, and Fear to Coerce andExtort Employees to Participate in Illegal RacketeeringActivities

208. The defendants, including Moore, Wilson, Oertle, and

Hannafey, regularly used on information and belief intimidation and

extortionate threats of economic punishment and job loss to instill

- 65 -

fear in the Fountain Division employees. The defendants were

successful – especially with the looming company-wide layoffs in 2000

and again in 2003.

209. The defendants’ intent and purpose was on information and

belief to coerce the employees to perform the necessary functions to

carryout the illegal racketeering activities outlined above in

Paragraphs 24 – 207, where simple criminal solicitation failed.

210. The defendants on information and belief responded swiftly

to employees’ objections or complaints about the Fountain Division’s

illegal racketeering activities. The defendants would and did on

information and belief make illegal and coercive threats of poor

reviews, bad performance grades, and termination if an employee

refused to buckle to their threats.

211. The defendants would and did carry out such threats,

including firing honest employees, in order to demonstrate to other

employees that “whistleblowing” would result in economic harm to

anyone who tried.

212. The defendants warned plaintiff Matthew Whitley to cease

complaining about their illegal activities in September 2002. The

defendants issued another veiled threat in December 2002. The

- 66 -

defendants’ message was that plaintiff Matthew Whitley should just

cooperate and participate in the illegal schemes when necessary.

213. When plaintiff Matthew Whitley “blew the whistle” to

defendant Heyer on February 4, 2003, after refusing the defendants’

criminal solicitations and extortionate warnings, the result was a

bogus and coercive substandard performance review. That review led

to plaintiff Matthew Whitley’s illegal and extortionate firing on

March 26, 2003.

214. The defendants used the firing of plaintiff Matthew Whitley

to make clear to other employees on information and belief that

“blowing the whistle” was a fatal offense at defendant TCCC.

215. Moreover, defendant TCCC continued its use of threats and

intimidation to illegally influence and coerce employees after

plaintiff Matthew Whitley made a settlement demand on defendant TCCC

for his illegal and extortionate firing, on or about April 2003.

216. Defendant TCCC notified numerous employees with relevant

information about the defendants’ racketeering activities that

plaintiff Matthew Whitley had made many of the foregoing allegations

of illegal conduct in the Fountain Division described above in Part

I. Defendant TCCC’s purpose was on information and belief two-fold:

(a) to subtly intimidate a number of these witnesses that employees

- 67 -

who “blow the whistle” will be considered traitors and turncoats

whose reputations and lives will be destroyed to protect defendant

TCCC; and (b) to subtly influence other witnesses to alter and

withhold honest and truthful testimony from federal authorities and

to prevent the communication of information to law enforcement.

217. Defendant TCCC specifically identified the “whistleblower”

and his allegations to the wrongdoers (such as defendants Vonderhaar,

Moore, Wilson, and Hannafey) on information and belief for the

purpose of influencing the witnesses’ testimony in several ways.

218. First, defendant TCCC tipped off the culpable participants

in the illegal schemes so, on information and belief, they could

review relevant materials and alter or eliminate their testimonial

and documentary evidence in a way that would protect defendant TCCC.

219. Second, defendant TCCC corruptly communicated this

information to the culpable participants so, on information and

belief, they could have time to plan their statements among

themselves in the light most favorable to defendant TCCC.

220. Third, defendant TCCC tipped off the culpable participants

to send the message that on information and belief testifying against

- 68 -

defendant TCCC would turn the company against those individual

defendants.

II. SENIOR MANAGEMENT’S MALICIOUS RESPONSE TO ITS OWN MISCONDUCT

A. Plaintiff Matthew WhitleyReported the Misconduct in Writing

221. Plaintiff Matthew Whitley raised all the issues listed

above in Part I in writing to management during the past five years.

222. As a man who “is all about integrity” (as stated in his

last review), he wanted to protect defendant TCCC’s purse, preserve

its reputation, and repair its dysfunctional culture. Plaintiff

Matthew Whitley wanted to be faithful to the call for integrity and

honesty in the Code of Conduct. But the defendants could care less.

223. On December 30, 2002, he began a month-long e-mail

correspondence with defendant TCCC’s new COO, defendant Steven Heyer,

in hopes of having many of these problems fixed. (Attached as

Exhibit C and made a part of the complaint for all purposes pursuant

- 69 -

to OCGA § 9-11-10(c) are the e-mails between plaintiff and defendant

Heyer and others.)

224. Plaintiff Matthew Whitley told defendant Heyer about the

fraud and malfeasance in the Fountain Division and shared a detailed

account of much of the misconduct.

225. When plaintiff Matthew Whitley shared this highly sensitive

information with defendant Heyer, the plaintiff did so – and made

explicitly clear - that he was entrusting not only the information

but his career to defendant Heyer. Plaintiff Matthew Whitley reposed

his trust and confidence in defendant Heyer and in defendant TCCC,

as a fiduciary, to take the steps necessary to protect the plaintiff

from illegal and extortionate retaliation. Defendant Heyer said

nothing to plaintiff Matthew Whitley to disavow these fiduciary

duties.

226. By being a whistleblower among thieves, plaintiff Matthew

Whitley put defendant Heyer and defendant TCCC‘s senior management

and Board of Directors squarely in the proverbial hot seat.

227. And plaintiff Matthew Whitley trusted that defendant Heyer,

as defendant TCCC’s COO, would resist the temptation to fire him for

being the messenger of very bad news. Plaintiff Matthew Whitley

guessed wrong.

- 70 -

228. Defendant Heyer breached the trust that the plaintiff had

placed in him by sharing directly and indirectly the plaintiff’s

disclosure of racketeering conduct with all the people identified in

the plaintiff’s memorandum – including defendants Vonderhaar, Wilson,

Oertle, and Hannafey.

229. And the defendants’ response was swift, malicious, and

painful. The defendants treated plaintiff Matthew Whitley and the

TCCC Code of Conduct, not to mention TCCC’s shareholders and

customers, like yesterday’s garbage.

B. Plaintiff Matthew Whitley’s E-Mails todefendant COO Steven Heyer Post-Sarbanes-Oxley

230. Plaintiff Matthew Whitley’s e-mail correspondence with

defendant Heyer reveals a disturbing pattern that foreshadowed what

was to come.

231. Their exchange went as follows:

- 12/30/02 -

8:08 a.m. Plaintiff plaintiff Matthew Whitleycongratulates Heyer on his promotion toCOO and asks about the direction ofdefendant TCCC.

* * * 63 minutes pass * * *

9:11 a.m. Heyer responds with a thank you note butcautions, “Those who chose [sic] not to

- 71 -

work in a respectful, trusting, andcollaborative manner focused on theprofitable growth of our total beverageportfolio, probably won’t like it atdefendant TCCC next year.”

- 12/31/02 -

7:38a.m. Plaintiff plaintiff Matthew Whitley tellsHeyer that he answered the question aboutTCCC’s direction and then, fatefully, sayshe has seen many unresolved actions anddecisions that have put TCCC at risk. “Ifthere is anything I can provide to you oraction to take, that will help you, pleaselet me know.”

* * * 73 minutes pass * * *

8:51 a.m. Heyer responds by asking for a list of theissues that he will share with TCCC CFOGary Fayard. But Heyer craftily cautionshe will only address “the ones that webelieve in with all deliberate speed”(which history proved is another way ofsaying “never”).

- 1/02/03 -

8:03 a.m. Plaintiff plaintiff Matthew Whitleyoutlines four basic categories into whichhis concerns with corporate governance,internal controls, and accounting fall: (i) leadership’s lack of integrity; (ii)the Code of Conduct is not being properlyor consistently applied; (iii) capital-management controls are ignored andsubverted; and (iv) accounting rules aredistorted.

* * * 54 minutes pass when Heyer opens the e-mail * * *

- 72 -

* * * 96 more minutes pass * * *

10:33 a.m.Heyer responds by asking for more specificsabout the issues, policies, and proceduresthat concern plaintiff Matthew Whitley.

- 1/03/03 -

8:50 a.m. Concerned about confidentiality, plaintiffMatthew Whitley tells Heyer that based onthe sensitive nature of the issues, e-mailmay not be the best way to layout theproblems.

* * * some time passes * * *

**** a.m. Heyer responds that an e-mail should be used.

- 1/16/03 -

**** a.m. Plaintiff plaintiff Matthew Whitley tellsHeyer that he is preparing a detaileddescription of the issues previouslydiscussed.

* * * some time passes * * *

10:36 a.m.Heyer responds via his hand-held Blackberry thathe looks forward to reviewing plaintiffMatthew Whitley’s materials with GaryFayard.

- 1/31/03 -

3:57 p.m. Plaintiff plaintiff Matthew Whitley e-mails toHeyer an attached memorandum describingmany of the issues discussed above in PartI. Plaintiff Matthew Whitley specificallymentions the trust he has placed in Heyerby taking the risk of challenging seniormanagement’s repeated misconduct: “I

- 73 -

believe that the risk I have taken is intrustworthy hands.”

* * *

**** _.m. HEYER NEVER RESPONDS

- 2/04/03 -

10:48 a.m. Plaintiff plaintiff Matthew Whitleyretransmits to Heyer his 1/31/03 e-mailwith the attached memorandum because hereceived a “failed to route” message.

* * *

**** _.m. HEYER NEVER RESPONDS

- 2/12/03 -

8:20 a.m. Plaintiff plaintiff Matthew Whitley asks ifHeyer has reviewed the 1/31/03 e-mail withthe attached memorandum and whether Heyerwould like it sent to Gary Fayard.

* * * 18 minutes pass when Heyer opens the e-mail * * *

8:38 a.m. HEYER NEVER RESPONDS

- 3/11/03 -

12:59 p.m. Plaintiff plaintiff Matthew Whitley renewshis e-mail exchange with Heyer to solicitdirection on whether he should share theissues raised in his 1/31/03 memorandumwith his new Vice President responsiblefor several of those problems. PlaintiffMatthew Whitley also states his concernabout the fact that he knows Heyer hasdisclosed the contents of his memorandumto the very people directly implicated in

- 74 -

wrongdoing. Plaintiff Matthew Whitleyfinally asks whether he should take hisconcerns to Deval Patrick, Esq., defendantTCCC’s General Counsel.

* * *

**** _.m. HEYER NEVER RESPONDS

232. A look at the correspondence initially shows defendant

Heyer to be unusually responsive for a busy COO to a mid-level

manager. But once defendant Heyer learned the gravity and wide-

ranging nature of the racketeering activity at defendant TCCC, he

stopped communicating with plaintiff Matthew Whitley.

233. Indeed, defendant Heyer’s first e-mail response, on

December 30, is revealing in retrospect. He warned plaintiff Matthew

Whitley to conform to TCCC’s degenerating culture or face

retaliation. Heyer said: “Those who chose [sic] not to work in a

respectful, trusting, and collaborative manner focused on the

profitable growth of our total beverage portfolio, probably won’t

like it at defendant TCCC next year.”

234. In other words, anyone whose actions may decrease profits

better watch his step. But plaintiff Matthew Whitley’s integrity and

naïve belief in the Code of Conduct blinded him to defendant Heyer’s

extortionate threat.

- 75 -

235. In fact, to carry out his threat of malicious and

unwarranted punitive and extortionate action against “disloyal”

employees, defendant Heyer shared the malfeasance memorandum with the

offenders, directly and indirectly.

236. And then, on information and belief, they – and the other

individual defendants – conspired to and did punish plaintiff Matthew

Whitley for simply being honest and trying to protect defendant

TCCC’s shareholders, customers, and employees.

C. Defendant TCCC Secret Plan to EliminatePlaintiff Matthew Whitley For Blowing the Whistle

237. In preparation for illegally firing plaintiff Matthew

Whitley under the guise of a company-wide money-saving “layoff,” TCCC

secretly created a new Director position in the Fountain Division

with responsibilities substantially identical to plaintiff Matthew

Whitley’s.

238. What that says is TCCC planned to fire plaintiff Matthew

Whitley regardless of the layoff to protect management and terrorize

the Fountain Division employees into supporting the defendants’

racketeering scheme. The layoff was a perfect pretext.

239. Then, on February 11, 2003, one week after plaintiff

Matthew Whitley alerted defendant Heyer to the racketeering,

malfeasance, fraud, accounting misconduct, and discrimination

- 76 -

problems at defendant TCCC, plaintiff Matthew Whitley had his year-

end performance review with his manager, defendant Hannafey.

240. Amazingly, plaintiff Matthew Whitley was reprimanded by his

manager Brian Hannafey during his review for questioning senior

management’s decision not to follow Generally Accepted Accounting

Principles and their demonstrated lack of integrity.

241. Defendant Hannafey punished the plaintiff for fulfilling

his fiduciary duty to TCCC shareholders by trying to stop the illegal

racketeering activity. This was done, on information and belief, in

agreement with and at the directions of defendants Heyer, Moore,

Wilson, Oertle, and Vonderhaar.

242. Defendant Hannafey’s groundless censure echoed defendant

Heyer’s December 30 threat that he wanted collaboration with the

marketers, not confrontation. As a result – just as the individual

defendants planned – plaintiff Matthew Whitley suffered the worst

review of his career at defendant TCCC for being honest.

243. Defendant Hannafey even admitted that plaintiff Matthew

Whitley’s decision to confront senior management’s outrageous and

improper conduct directly contributed to his first negative rating

in 11 years with TCCC. And defendant Hannafey threatened plaintiff

Matthew Whitley by warning, “don’t do anything stupid.”

- 77 -

244. But after delivering the bad review to plaintiff Matthew

Whitley, defendant Hannafey quickly returned to his office where he

deleted from the draft version of the review those incriminating

portions of his analysis that discussed senior management’s

misconduct. Defendant Hannafey was trying to cover-up the

defendant’s malicious and unlawful extortion and to create

“deniability.”

245. Significantly, well before February 11, 2003, from

defendant Heyer on down, all TCCC employees knew that defendant TCCC

planned to layoff hundreds of employees in late March 2003.

246. And all TCCC employees, including the individual

defendants, knew that intervening performance reviews, like plaintiff

Matthew Whitley’s, would play a crucial role in the layoff assessment

process. In fact, the individual defendants knew that the

intervening performance reviews would constitute 50 percent of the

decision to layoff employees.

247. Thus, by maliciously manufacturing a bad review for

plaintiff Matthew Whitley on grounds of showing too much integrity

and being too honest, the defendants laid the cornerstone for his

dismissal. And in the process, violated their fiduciary duty to

protect corporate assets and the shareholders.

- 78 -

D. The Defendants Illegal and Unlawful MeansFor Terminating Plaintiff Matthew Whitley

248. On or about January 2003, defendant TCCC determined that

until on or about March 27, 2003, the only means by which TCCC

employees would be terminated – other than for gross violations of

the Code of Conduct after an appropriate investigation – was pursuant

to the “layoff assessment” process. Defendant TCCC prescribed

specific criteria to be used in making individual layoff decisions.

249. On or about early 2003, defendant TCCC further represented

to its employees, including plaintiff Matthew Whitley, that the

layoff assessment process would be fair and equally applied to all

employees.

250. On or about early 2003, defendant TCCC also represented to

all its employees, including plaintiff Matthew Whitley, that the

company’s rights and the plaintiff’s rights concerning continued

employment would be governed exclusively by the “layoff assessment”

process (exclusive of Code-of-Conduct violations).

251. Nevertheless, in carrying out their conspiracy to punish

the plaintiff, the defendants chose defendants Oertle and Hannafey

to perform the purported layoff review on plaintiff Matthew Whitley.

By that time, on or about early March 2003, the defendants had

- 79 -

already decided to fire plaintiff Matthew Whitley as punishment for

“blowing the whistle” by using the layoff process as a cover-up.

252. Defendant Oertle, of course, had been fingered by plaintiff

Matthew Whitley in his memorandum to defendant Heyer as having been

directly involved in engineering the iFountain slush funds.

Plaintiff Matthew Whitley had also branded defendant Oertle’s

supervisor, defendant Jack Wilson, as a willful participant in the

iFountain slush fund’s creation in the memorandum to defendant Heyer.

The head of defendant TCCC Internal Audit, defendant Steven

Vonderhaar, was even implicated in a cover-up of the iFountain slush-

funds by plaintiff Matthew Whitley’s memorandum. And defendant

Hannafey had endorsed the illegal scheme when it first started in

2001.

253. The defendants’ choice of defendants Oertle and Hannafey

to assess plaintiff Matthew Whitley defied the most basic,

commonsense rule that protects against unlawful retaliation: Never

let a supervisor with a motive to retaliate review his accuser. That

rule is even more obvious when the reviewer’s supervisor, and the

supervisor’s supervisor, is likewise accused of wrongdoing – unless

a cover-up is in the works, as it was here.

- 80 -

254. The defendants, on information and belief, selected

defendant Oertle to assess plaintiff Matthew Whitley for several

reasons. Defendant Oertle had an ax to grind the size of Paul

Bunyan’s. But because he was retiring from defendant TCCC anyway,

defendant Oertle could do the “get-even” dirty work for himself and

defendants Moore, Wilson, and Vonderhaar with little personal

consequence. And defendant Oertle could help defendant Heyer to wash

TCCC’s hands of the S.E.C., D.O.J., and E.E.O. problems raised by

plaintiff Matthew Whitley for the same reason. Defendant Hannafey

was selected, on information and belief, to make the process appear

legitimate because he was the plaintiff’s supervisor.

255. The defendant’s choice of defendants Oertle and Hannafey

let defendants Heyer, Moore, Wilson, and Vonderhaar keep their

fingerprints directly off the firing decision.

256. Firing plaintiff Matthew Whitley also set the stage for the

defendants’ use of the age-old moniker of “disgruntled employee” to

intentionally disparage plaintiff Matthew Whitley’s reputation and

his well-documented descriptions of corporate malfeasance.

257. Defendant Vonderhaar, and on information and belief other

representatives and agents of defendant TCCC, has already begun a

- 81 -

campaign of defamation against plaintiff Matthew Whitley at defendant

TCCC and elsewhere.

258. And in his job search, plaintiff Matthew Whitley has had

to deal with the false appearance of incompetence created by the sham

layoff decision by the defendants.

CAUSES OF ACTION

Count I: RICO Conspiracy(All Defendants)

259. Plaintiff re-alleges and incorporates by reference

paragraphs 1 - 258 with the same force and effect as if fully set out

in specific detail herein.

260. The defendants have conspired and endeavored to violate the

Georgia RICO statute, OCGA § 16-14-4(a), by conspiring and

endeavoring, through a pattern of racketeering activity or proceeds

derived therefrom, to acquire or maintain, directly or indirectly,

any interest in or control of any enterprise, real property, and

personal property of any nature, including money, all in violation

of OCGA § 16-14-4(c).

261. The defendants have conspired and endeavored to violate the

Georgia RICO statute, OCGA § 16-14-4(b), as persons employed by or

associated with any enterprise, that is, an association-in-fact of

the defendants, to conduct or participate in, directly or indirectly,

- 82 -

such enterprise through a pattern of racketeering activity, all in

violation of OCGA § 16-14-4(c).

262. Specifically, the defendants have conspired to and

endeavored to engage in, and have repeatedly committed, the following

criminal activities under Georgia and federal law, which constitute

a pattern of racketeering activity under OCGA § 16-14-3(8 & 9):

theft in violation of OCGA § 16-8-1 et seq.; securities fraud in

violation of OCGA § 10-5-24; mail fraud in violation of 18 U.S.C. §

1341; obstruction of justice in violation of 18 U.S.C. § 1512;

influencing witnesses in violation of OCGA § 16-10-93; tampering with

evidence in violation of 16-10-94; and extortion in violation of 18

U.S.C. § 1951.

263. In furtherance of such conspiracy to violate the Georgia

RICO statute, in violation of OCGA § 16-14-4(c), the defendants

knowingly and willfully committed extortion against plaintiff Matthew

Whitley by illegally taking his job away in order to continue to

conduct the defendants’ racketeering enterprise.

264. And in furtherance of such conspiracy to violate the

Georgia RICO statute, in violation of OCGA § 16-14-4(c), the

defendants knowingly and willfully committed obstruction of justice

under federal law and influencing witnesses and tampering with

- 83 -

evidence in violation of Georgia law against plaintiff Matthew

Whitley by illegally influencing and attempting to influence

witnesses and to alter evidence to continue to conduct the

defendants’ racketeering enterprise and to deprive plaintiff Matthew

Whitley of his rights to a fair and just hearing on his complaint.

265. Plaintiff Matthew Whitley has suffered extreme emotional

distress as the result of the extortionate, willful, malicious, and

intentional acts of the defendants.

266. As a result of the defendants’ actions, plaintiff has

suffered and is continuing to suffer injury including, but not

limited to, substantial loss of income, and loss of benefits.

267. As a result of the defendants’ actions, plaintiff has

suffered and is continuing to suffer injury including emotional pain,

suffering, humiliation, inconvenience, mental anguish, loss of

enjoyment of life, and other non-pecuniary losses.

268. Plaintiff seeks to redress the wrongs alleged herein, and

this suit for equitable, compensatory, and punitive damages, is

plaintiff’s only means of securing adequate relief.

269. Plaintiff Matthew Whitley has been injured by reason of

such violations of OCGA § 16-14-4 and therefore is entitled to three

- 84 -

times his actual damages sustained, punitive damages, plus all

attorneys' fees in the trial and appellate courts and costs of

investigation and litigation reasonably incurred, pursuant to OCGA

§ 16-14-6(b).

Count II: Intentional Infliction of Emotional Distress(All Defendants)

270. Plaintiff re-alleges and incorporates by reference

paragraphs 1 - 258 with the same force and effect as if fully set out

in specific detail herein.

271. The defendants have maliciously and intentionally engaged

in outrageous conduct against the plaintiff.

272. Plaintiff Matthew Whitley has suffered extreme emotional

distress as the result of the extortionate, willful, malicious, and

intentional acts of the defendants. The defendants first tried to

require the plaintiff to become a criminal in order to perform his

job. Then the defendants extortionately threatened and finally

punished the plaintiff for being honest and blowing the whistle on

their racketeering scheme.

273. In short, the plaintiff was extorted by members of a RICO

enterprise for trying to protect the economic interests of

shareholders, customers, and employees of defendant TCCC. Such

conduct by the defendants is so outrageous and extreme as to go

- 85 -

beyond all possible bounds of decency, and to be regarded as

atrocious, and utterly intolerable in a civilized community.

274. As a direct and proximate result of the acts identified in

this Complaint and such other acts to be shown by evidence, including

the conspiracy to violate the Georgia RICO statute and commit other

illegal acts, including obstruction of justice, and to cover up those

illegal acts, plaintiff Matthew Whitley has suffered injuries to

person and property, including emotional distress that defies

description.

275. As a result of the defendants’ actions, plaintiff has

suffered and is continuing to suffer injury including, but not

limited to, substantial loss of income, and loss of benefits.

276. As a result of the defendants’ actions, plaintiff has

suffered and is continuing to suffer injury including emotional pain,

suffering, humiliation, inconvenience, mental anguish, loss of

enjoyment of life, and other non-pecuniary losses.

277. Plaintiff seeks to redress the wrongs alleged herein, and

this suit for equitable, compensatory, and punitive damages, is

plaintiff’s only means of securing adequate relief.

Count III: Wrongful Terminationr(All Defendants)

- 86 -

278. Plaintiff re-alleges and incorporates by reference

paragraphs 1 - 258 with the same force and effect as if fully set out

in specific detail herein.

279. The defendants have wrongfully terminated plaintiff by

maliciously manufacturing a false and fraudulent performance review

to avoid compliance with defendant TCCC’s stated criteria to ensure

a fair and equally-applied layoff assessment process, which thereby

limited defendant TCCC’s common-law right to fire plaintiff for any

reason of its choosing.

280. As a result of the defendants’ actions, plaintiff has

suffered and is continuing to suffer injury including, but not

limited to, substantial loss of income, and loss of benefits.

281. As a result of the defendants’ actions, plaintiff has

suffered and is continuing to suffer injury including emotional pain,

suffering, humiliation, inconvenience, mental anguish, loss of

enjoyment of life, and other non-pecuniary losses.

282. Plaintiff seeks to redress the wrongs alleged herein, and

this suit for equitable, compensatory, and punitive damages, is

plaintiff’s only means of securing adequate relief.

Count IV: Tortious Interference(All Defendants)

- 87 -

283. Plaintiff re-alleges and incorporates by reference

paragraphs 1 - 258 with the same force and effect as if fully set out

in specific detail herein.

284. Defendants Heyer, Moore, Wilson, Vonderhaar, Oertle, and

Hannafey intentionally interfered with plaintiff’s employment

relationship with TCCC, including his termination rights as

exclusively prescribed by defendant TCCC’s layoff-assessment process,

by making false and malicious statements about plaintiff and acting

in bad faith which caused plaintiff’s termination. The reason is

none of these individual defendants had the individual or unilateral

authority to terminate plaintiff Matthew Whitley during the period

of the layoff assessment process.

285. Also, the layoff-assessment process removed from all

decision makers at the company the authority to terminate plaintiff

Matthew Whitley at will. Consequently, defendant TCCC is vicariously

liable for the actions of the individual defendants under the

doctrine of respondeat superior.

286. As a result of the defendants’ actions, plaintiff has

suffered and is continuing to suffer injury including, but not

limited to, substantial loss of income, and loss of benefits.

- 88 -

287. As a result of these defendants’ actions, plaintiff has

suffered and is continuing to suffer injury including emotional pain,

suffering, humiliation, inconvenience, mental anguish, loss of

enjoyment of life, and other non-pecuniary losses.

288. Plaintiff seeks to redress the wrongs alleged herein, and

this suit for equitable, compensatory, and punitive damages, is

plaintiff’s only means of securing adequate relief.

Count V: Conspiracy to Commit Tortious Interference(All Defendants)

289. Plaintiff re-alleges and incorporates by reference

paragraphs 1 - 258 with the same force and effect as if fully set out

in specific detail herein.

290. Defendants Heyer, Moore, Wilson, Vonderhaar, Oertle, and

Hannafey conspired to intentionally interfere with plaintiff’s

employment relationship with TCCC, including his termination rights

as exclusively prescribed by defendant TCCC, causing plaintiff’s

termination.

291. Because the layoff-assessment process removed from all

decision makers at the company the authority to terminate plaintiff

Matthew Whitley at will, defendant TCCC is vicariously liable for the

actions of the individual defendants under the doctrine of respondeat

superior.

- 89 -

292. As a result of these defendants’ actions, plaintiff has

suffered and is continuing to suffer injury including, but not

limited to, substantial loss of income, and loss of benefits.

293. As a result of Thorne’s and William’s actions, plaintiff

has suffered and is continuing to suffer injury including emotional

pain, suffering, humiliation, inconvenience, mental anguish, loss of

enjoyment of life, and other non-pecuniary losses.

294. Plaintiff seeks to redress the wrongs alleged herein, and

this suit for equitable, compensatory, and punitive damages is

plaintiff’s only means of securing adequate relief.

Count VI: Breach of Fiduciary Duty(Defendants TCCC and Heyer)

295. Plaintiff re-alleges and incorporates by reference

paragraphs 1 - 258 with the same force and effect as if fully set out

in specific detail herein.

296. Defendants TCCC and Heyer owed plaintiff Matthew Whitley

a fiduciary duty to maintain the trust and confidence he reposed in

them when he shared the incriminating information about the illegal

racketeering activities engaged in by defendants Vonderhaar, Moore,

Wilson, Oertle, and Hannafey. But defendants TCCC and Heyer breached

their fiduciary duties to the plaintiff in connection with such

information.

- 90 -

297. As a result of the defendants’ actions, plaintiff has

suffered and is continuing to suffer injury including, but not

limited to, substantial loss of income, and loss of benefits.

298. As a result of these defendants’ actions, plaintiff has

suffered and is continuing to suffer injury including emotional pain,

suffering, humiliation, inconvenience, mental anguish, loss of

enjoyment of life, and other non-pecuniary losses.

299. Plaintiff seeks to redress the wrongs alleged herein, and

this suit for equitable, compensatory, and punitive damages, is

plaintiff’s only means of securing adequate relief.

Count VII: Slander(All Defendants)

300. Plaintiff re-alleges and incorporates by reference

paragraphs 1 - 258 with the same force and effect as if fully set out

in specific detail herein.

301. The defendants have slandered plaintiff in making false,

malicious, defamatory and derogatory statements about plaintiff to

other employees of defendant TCCC and through plaintiff’s forced re-

publication of such statements.

302. As a result of the defendants’ actions, plaintiff has

suffered and is continuing to suffer injury including, but not

limited to, substantial loss of income, and loss of benefits.

- 91 -

303. As a result of the defendants’ actions, plaintiff has

suffered and is continuing to suffer injury including emotional pain,

suffering, humiliation, inconvenience, mental anguish, loss of

enjoyment of life, and other non-pecuniary losses.

304. Plaintiff seeks to redress the wrongs alleged herein, and

this suit for equitable, compensatory, and punitive damages, is

plaintiff’s only means of securing adequate relief.

Count VIII: Attorney’s Fees and Costs(All Defendants)

305. Plaintiff re-alleges and incorporate by reference

paragraphs 1-263 with the same force and effect as if fully set out

in specific detail herein below.

306. All defendants have acted in bad faith and have caused

plaintiff unnecessary trouble and expense.

307. As a result of the defendants’ conduct, plaintiff is

entitled to attorney’s fees and costs related to this litigation

pursuant to OCGA § 13-6-11.

PRAYER FOR RELIEF

WHEREFORE, Plaintiff respectfully prays that this Court assume

jurisdiction of this action and after trial:

a. Issue a declaratory judgment holding that the actions

of the defendants violated the rights of plaintiff under Georgia law.

- 92 -

b. Enter an order requiring the defendants to make

plaintiff whole by awarding plaintiff equitable (including back pay

and front pay) damages, compensatory damages, treble damages, and

punitive damages, costs to include costs of investigation, attorney's

fees, expenses, and pre-judgment and post-judgment interest.

c. Plaintiff further prays for such other relief and

benefits as the cause of justice may require.

JURY DEMAND

PLAINTIFF DEMANDS A TRIAL BY A STRUCK JURY.

Respectfully submitted,

________________________________Marc N. GarberGeorgia Bar No. 283847Attorney for the Plaintiff

THE GARBER LAW FIRM, P.C.3939 Roswell Road NESuite 265Marietta, Georgia 30062-6226678-560-5066 (phone)678-560-5067 (facsimile)