Mattson and LeFever face class action lawsuit in federal court

Ken Mattson, Tim LeFever and their troubled companies suffered a major – albeit expected – blow on Monday when three major California law firms filed a class action lawsuit in federal court on behalf of investors in the partners’ various ventures in the Northern District of California.

The lawsuit accuses Mattson and LeFever of fraud and breach of fiduciary duty. They allegedly used a “complex web of companies” to operate a large-scale real estate investment scheme. Victims were led to believe their investments were safe by making regular interest payments. These “concealed a growing disarray and illegal commingling of investor funds in a number of unidentified properties,” according to a statement from the plaintiffs’ attorneys.

Mattson and LeFever could not immediately be reached for comment.

The investors are represented by Cotchett, Pitre & McCarthy, based in San Francisco, CaseyGerry, based in San Diego, and Lieff Cabraser, also based in San Francisco.

The lawsuit names seven individual investors, although the class action structure could allow many more investors to join. Ken Mattson, Tim LeFever and their many joint companies, including LeFever Mattson, are believed to have worked with several hundred investors over the years.

It is still unclear how many of their individual investment funds experienced defaults or other irregularities.

Over the past decade, Mattson, together with LeFever and through his company KS Mattson Partners, has purchased well over 100 properties in and around Sonoma, sparking distrust and resentment in the community.

Defendants in the class action lawsuit include Tim LeFever, Ken Mattson, KS Mattson Partners, LeFever Mattson and three of their funds – Home Tax Service of America, Divi Divi Tree LP and Specialty Properties Partners LP.

Mattson and LeFever were lifelong friends, but their partnership began to unravel in early April when LeFever informed investors that he had replaced Mattson as CEO of LeFever Mattson Inc.

LeFever later informed authorities, including the U.S. Attorney’s Office and the U.S. Securities and Exchange Commission, about what he believed were improper transactions by Mattson. On May 24, the FBI raided Mattson’s home in Sonoma. On June 6, he and LeFever filed lawsuits, and a handful of other investors have filed individual lawsuits against them.

This is the first class action lawsuit against the duo.

NOTE: This is a developing story. Check back later for updates.

Reach Phil Barber at 707-521-5263 or [email protected]. On X (Twitter) @Skinny_Post.