SPOKANE - Aug. 24, 2001 - The Washington state Attorney General's office went to court today to prevent a New Jersey man from seeking investors in phony devices that he claims provide free or low-cost power.
In papers filed in Spokane County Superior Court, state attorneys are seeking a court order that bars Dennis Lee and his company, United Community Services of America, from soliciting money, monetary investment or financial commitments from consumers at a sales presentation scheduled for Aug. 28 at a Spokane hotel.
Lee and his company "have not shown that the relevant technology exists or ever will exist" to fulfill the promise of free electricity generation, state attorneys say in the complaint.
According to the complaint, Lee's company has posted Internet advertisements for "a free show (to) witness a dozen things the 'experts' say are 'impossible.'"
"Dennis Less and his companies have a demonstrated history of trying to defraud consumers," said Attorney General Christine Gregoire. "During the current energy crisis, some consumers may be vulnerable to his incredible promises and may fall victim to his scam. We want to make sure that doesn't happen."
State attorneys say Lee will pitch a so-called "Sundance Generator," which he claims generates electricity and sends it back to local utilities. As a result, he claims consumers' electric meters move backwards.
State attorneys say Lee encourages people to sign an agreement to bid on and purchase one of a limited number of United Community Services of America dealerships, which Lee claims to be valued at between $30,000 and $100,000. To be eligible to bid, consumers must make a "good faith deposit" of 10 percent of what they are willing to pay.
In 1985, Lee marketed a "solar utility network" through a company called C.O.N.S.E.R.V.E. State attorneys claim he falsely promised that consumers could cut their electric bills by 70 percent to 80 percent by purchasing a device connecting them to a nationwide grid of other users.
In that case, the Attorney General's office obtained a court judgment that found that he was guilty of false advertising.
He returned to Washington again in 1999 and at presentations in Yakima and Tacoma he sold interests in "perpetual motion machines" that he claimed could generate electricity.
The state Department of Financial Institutions (DFI) filed a Cease and Desist order against Lee on the grounds that he was offering securities without being registered as a securities dealer or broker in Washington.
According to investigators at the Tacoma presentation, Lee tore the DFI order up in front of the crowd.
Attorneys will return to court on Monday to seek a Temporary Restraining Order against Lee at which time a hearing on a motion for a permanent injunction will be scheduled.