Grant and Elena Cardone drive the fanciest car at Flag. The big shiny custom Cardonemobile is 100% powered by other people’s money.
Grant Cardone and Cardone Capital LLC suffered a staggering legal setback in December 21, 2022 when the US 9th Circuit Court of Appeals overturned a lower court by ruling that Cardone’s online solicitations for his private equity funds made both Cardone and his company statutory sellers of of securities. The case is captioned Luis Pino v. Cardone Capital, LLC et. al. No. 21-55564 (9th Cir. 2022).
We reported on this in a previous article.
As a consequence of legal loss in Pino v. Cardone et. al., Grant Cardone filed a petition for a writ of certiorari before the US Supreme Court in April 2023. Scroll down to read the document. Cardone’s petition makes for interesting reading as it reveals Cardone’s incredible fear of what a loss in Pino v. Cardone would cost him financially inasmuch as it would open a floodgate of litigation and class action lawsuits against him personally and his funds.
In this excerpt from his petition, Cardone’s attorneys argue a theory of economic harm to the American economy as if this means anything whatsoever:
In 2022, 205 new securities class actions were filed. Janeen McIntosh et al., Recent Trends in Securities Class Action Litigation: 2022 Full-Year Review, NERA Econ. Consulting 1 (Jan. 24, 2023), . In the same year, companies paid $4 billion to settle securities class actions. The costs of defending these lawsuits, on top of paying these settlements, are enormous. As Justice Gorsuch has observed, “new corporate investments are deterred, the efficiency of the capital markets is reduced, and the competitiveness of the American economy declines.” Neil M. Gorsuch & Paul B. Matey, Settlements in Securities Fraud Class Actions: Improving Investor Protection 32 (Wash. Legal Found., Critical Legal Issues Working Paper No. 128, 2005).
Cardone’s attorneys make the same generalized inapposite argument later in the filing. In Scientology this would be called “creating a dangerous environment” in order to scare people. Based upon the language in the excerpt below, Grant Cardone implies that if he is sued into oblivion the entire US economy will suffer:
This Court has recognized the tremendous power that securities litigation wields over both investors and the national economy. Merrill Lynch, Pierce, Fenner & Smith Inc. v. Dabit, 547 U.S. 71, 80-81 (2006) (noting that, in the context of securities, the “class action device” can “injure ‘the entire U.S. 34 economy’” (quoting H.R. Conf. Rep. No. 104-369, at 31); see also Halliburton Co. v. Erica P. John Fund, Inc., 573 U.S. 258, 277 (2014) (Congress enacted the PSLRA “to combat perceived abuses in securities litigation”); Blue Chip Stamps v. Manor Drug Stores, 421 U.S. 723, 739 (1975) (“There has been widespread recognition that litigation under Rule 10b-5 presents a danger of vexatiousness different in degree and in kind from that which accompanies litigation in general.”).
What Cardone ignores is the fact that if Cardone Capital is sued into oblivion then his debt-bloated assets would be sold off and the lenders and investors would be paid off whatever remained.
When Cardone’s petition does focus specifically on what Cardone said in his online solicitations, it attacks the 9th Circuit and attempts to mitigate Cardone’s statements in social media as off the cuff comments:
In addition to opening a split with other circuits, the Ninth Circuit’s decision also contravenes the basic policy rationale underlying the bespeaks caution doctrine. For starters, it elevates off-the-cuff remarks made in social media posts above the extensive disclosures and cautions in formal offering circulars and other documents.
However, investors watched the Cardone videos for years and saw Grant Cardone offer very specific promises on performance and rates of return. Many investors on YouTube called out Grant Cardone. What Cardone said were not off the cuff remarks. The evidence is all there.
SCOTUS may choose to hear Cardone’s case as so many private solicitations are made in social media.
Over against his reckless solicitations on social media, Grant Cardone has long attacked the idea of home ownership and urged people to invest in his apartment funds. Cardone has even urged his viewers to sell their homes and invest everything into Cardone Capital.
Robert Kiyosaki recently criticized Grant Cardone’s chronic attacks on home ownership and said exactly what Cardone is doing and that is to sell you apartment buildings:
Categories: Grant Cardone
Great work Jeffrey, couldn’t happen to a nicer slimeball! 😏
Grunt Hambone aka Grift Condom is merely making “off-the-cuff” remarks, postulating, and speaking new hustles into reality, all in the “spirit of play”, up there in the “ass-thetics” band of the bone scale.
I see bankruptcy and, possibly, interactions with tio RICO in his future…
As Margaret noted, it couldn’t happen to a greasier, more narcissistic slimeball…
“it elevates off-the-cuff remarks made in social media posts above the extensive disclosures and cautions in formal offering circulars and other documents.”
Every salesperson as well as every web site harvesting our data and turning us into a commodity know this: Disclosures and cautions do little to queer a deal. Or even significantly influence whether a prospect will become a buyer. If they did, there would be no google, facebook or cardone.
People listen to the pitch (or hype) in detail. That’s when they decide to go for it. And the decision is typically heavily influenced by their chemistry with the salesperson. Especially if that involves the perpetual insinuation that you too can mount a private jet and a trophy wife.
Mind made up, the buyer may take a perfunctory glance at the “extensive disclosures and cautions”, at least the parts that they can even understand. After all, a team of lawyers took all the time they needed to compose these disclosures while a small-time customer–the most vulnerable investor type–has a minute or two to look this over. And to quote Don Henley: “You cross a lawyer with a godfather, he’ll make you an offer that you cannot understand.” (Henley should know, being pretty litigious himself, but I digress).
Having issued “off-the-cuff remarks” should never be a defense when done so in a widely disseminated video where the author had every opportunity to edit these remarks out. Otherwise, the entire pitch could be classified “off-the-cuff remarks” and evade accountability in its entirety.
It sounds like they’re trying the “too big to fail” gambit. The fake billionaire may want to jet to fellow scammer Gentile who once held a portfolio of comparable size. Ask him how that works out…
It’s a funny thing about investment “advisers” like Grant: First they tell you that investing is so daunting that you depend on their (and only their) advice. Preferably, that advice that will cost you a bundle. For your advice dollars, they will give you gross oversimplifications such as “cash is trash”, “your residence is a liability” or “buy an apartment complex only.” (Advices may vary slightly based upon what they are selling). Or their favorite, “max out your credit card and give it all to me; it’s the best investment you’ll ever make.”
Unconscionably, no general education (high school or above) gives students any tools to create their own investment advice. Some majors are almost guaranteed to churn out graduates with considerable earning power. And since company pensions have gone the way of the dodo bird and SSI is meant to be a survival supplement only, we are all forced to become lifelong investors or retire in poverty. And yet, states prefer to subject students to compulsory courses including dubious theories of “social justice” and sound ideas on lifelong fitness instead of addressing even the basic parameters of financial fitness. Or the current federal gov’t would rather have inflation-struck working families pay the debt of those privileged to go to college in the first place (buying votes and supporting overpriced schools in the process) than educate high schoolers about sound financial practices, including college attendance and debt commitments.
So this vacuum is filled with pitch(wo)men with dubious advice and much self-interest. Kiyosaki recommends intellectual property (and coincidentally, offers a book on the subject). But unless you’re Bernie Sanders or Ron Hubbard, a book is no road to wealth that will force you to strike millionaires from your enemies list and enable you to collect houses (I’ve considered a book contract and got enough of a lesson in the fundamentals to find it a waste of time). Also, no one seems to address that there is no such thing as THE housing market. What works in FL may not work in SD. And that may flip in 5 years.
You can make a bundle with your residence or a housing complex alike (I am again speaking from experience with both) or lose it all (dto about personal experience). But if no one has taught you the parameters–they’re NOT rocket surgery!–and how to pursue what’s best for your family, you’ll be left with two choices: Don’t invest at all, a sure road to ruin. Or give your money to someone else. They will surely profit and you can only hope that you may also.