A new lawsuit accuses Emmitt Smith of running a multimillion-dollar fraud scheme. The NFL’s all-time rushing leader allegedly deceived a tribal government agency into a fraudulent energy project as part of a Ponzi-like scheme to pay back another business partner.
The economic development arm of the Eastern Band of Cherokee Indians, an affiliate of Kituwah LLC, sued Emmitt Smith, his commercial real estate firm, 4 13 Solutions Inc., and several partners on Monday in Delaware’s Chancery Court.
According to the lawsuit, the former Dallas Cowboys and Arizona Cardinals running back, along with his longtime business partner David Mosley and 4 13 Solutions, persuaded Kituwah to provide a $2.5 million loan for an alleged solar project called Project Exodus. Despite the loan being almost two years past due and multiple attempts for return, Kituwah claims it has “not recovered a penny.”
Kituwah claims 4 13 Solutions pledged millions of dollars in revenue from the solar farm by the end of 2024, mutual ownership and control of the joint venture, and an Energy Department loan for “permanent financing.” According to the investors, Kituwah agreed to establish a joint LLC called Jabez 4 10 and take out the $2.5 million loan in September 2023 based on “false projections and data” and because Smith and Mosley insisted they would pay it back within months.
The lawsuit claims Emmitt Smith’s company funneled the money to another business
The lawsuit claims Smith and the other defendants covertly designated the $2.5 million to “improperly pay” Wilson Holdings, a company with which they had previously collaborated on other ventures. The lawsuit also names Wilson Holdings as a defendant.
Kituwah asserts that 4 13 Solutions completely excluded the Cherokee group from managing the venture rather than sharing management, and it still claims to have no access to the joint company’s finances. They also claim that neither a government loan nor an alternative private loan was ever obtained, and 4 13 Solutions has not provided “any evidence that Project Exodus has made any meaningful progress towards completion” of the solar farm “despite promises that it would be “up and running” by the end of 2024.
Front Office Sports reports that the lawsuit includes six causes of action, including breach of contract, breach of fiduciary duty, and fraudulent inducement. It states that the loan has about $600,000 in interest, which means the current debt is more than $3 million.
In addition to interest, charges, and expenditures, the complaint demands at least $2.5 million in damages, which the court will decide at trial. Along with “further relief as the court deems just and proper,” it also asks for legal fees and other expenses related to filing the complaint.
A Kituwah spokesman did not immediately answer a request for further comment by Front Office Sports. Courthouse News also could not reach representatives from 4 13 Solutions for comment.