He was targeted with fake Craigslist sex ads in ‘smear campaign.’ Now he’s suing to get his life back

Dalas Gundersen in his new office where he runs a financial planning business in Willows on Aug. 3, 2017. Gundersen sees himself having to fight for his business after he was let go by Edward D. Jones and a smear campaign was started against him allegedly by Edward D. Jones employees. In small communities throughout the country, Edward D. Jones & Co is a familiar storefront. The small brokerage offices often are the sole providers of financial services to small-town residents unwilling or unable to drive to the nearest city. This is all part of Edward Jones business model, and Northern California is no exception with more than 50 advisers in small offices from Willows (population 6,077) north to Yreka.
Dalas Gundersen in his new office where he runs a financial planning business in Willows on Aug. 3, 2017. Gundersen sees himself having to fight for his business after he was let go by Edward D. Jones and a smear campaign was started against him allegedly by Edward D. Jones employees. In small communities throughout the country, Edward D. Jones & Co is a familiar storefront. The small brokerage offices often are the sole providers of financial services to small-town residents unwilling or unable to drive to the nearest city. This is all part of Edward Jones business model, and Northern California is no exception with more than 50 advisers in small offices from Willows (population 6,077) north to Yreka. hamezcua@sacbee.com

By many measures, Dalas Gundersen was a successful and enviable figure in this Northern California farming town. Over 15 years, he grew his financial planning business with Edward D. Jones & Co. to customer accounts worth $150 million. He twice served as president of the Willows Rotary Club. His son was an Eagle Scout.

Gundersen was good for the town, some residents say, and the town was good for him – until cyberbullying nearly ruined it all.

Today, the 52-year-old married father of grown children is locked in a bitter legal battle with Edward Jones and two former colleagues in a case that has shocked and divided residents in Willows, a community of 6,000 about 85 miles northwest of Sacramento. At its core is a fundamental question with far-reaching implications: How vulnerable is any one of us to digital assault and its reputation-wrecking capabilities?

Just ask Gundersen.

According to a lawsuit filed in Glenn County Superior Court, the businessman became the unwitting victim in 2015 of an alleged scheme by his former Edward Jones colleagues to plant phony gay-sex ads on Craigslist to “harass, intimidate and defame” him and drive him out of the county.

The secret “smear campaign” began in September 2015, nine months after Gundersen was fired by Edward Jones for violating a company policy, the lawsuit states. Gundersen left his small office on West Sycamore Street and set up a competing financial planning firm a half-mile away.

The lawsuit describes how Gundersen soon became the target of internet impersonation when multiple personals ads appeared on Craigslist, listing his phone number and physical description, seeking sexual encounters with men.

One chatty posting stated a preference for men “younger in age and heart.” Another used exceptionally graphic language in describing desired sex acts.

“The only thing I have is my reputation – my whole business is predicated on the idea that people can trust me,” said Gundersen, who also heads the town’s Speakeasy Toastmasters Club. “To have this professional pall cast over me – it’s been a real fight.”

Gundersen was visiting San Francisco with his wife of 19 years when the first strange call came in. He soon was bombarded by unwanted calls and texts – including photos of male genitalia.

“To build his business, Gundersen had to answer every call he received and accept every request for a meeting, not knowing if those calls and meetings would manifest into sexual assaults,” the lawsuit states.

One caller was arrested for a violent crime not long after contacting Gundersen, the lawsuit alleges. Some ads also seemed “timed” to generate calls and pop-ups during the weekly Rotary meeting on Thursdays at noon.

Then came the uncomfortable, sideways glances from a handful of townspeople. In a matter of months, he said, he went from being a “highly productive person” to feeling like an outcast in his own community.

“It’s been a struggle,” he said recently, his eyes tearing, “a real struggle.”

In court papers, Edward Jones has vigorously denied any knowledge of or involvement in the impersonation scheme, although one of its longtime employees – who since has been fired – admitted in a sworn declaration to placing two of the ads.

In Glenn County, an agricultural region of about 28,000 that straddles Interstate 5, the fallout has been brutal on both sides. The case has fired up a local newspaper publisher with a penchant for aggressive, bare-knuckle reporting. The publicity prompted one defense attorney to ask that the trial be moved to Sacramento. And, the lawsuit has pitted a blue-chip San Francisco law firm against a young, hometown lawyer, who set out two years ago to untangle the mysterious web of events that ensnared Gundersen.

“What makes this so shocking is, this is the new crime,” said attorney John Garner, 36, a Willows native who returned home to practice law with his father.

“You can be anybody you want to be online.”

Garner contends that what happened to Gundersen is symptomatic of a kind of “Wild Wild West” culture perpetuated by Edward Jones throughout Northern California. The company, headquartered in Des Peres, Mo., has sprinkled small branch offices throughout the rural counties but does not provide adequate oversight and training, the attorney said.

One Edward Jones regional leader allegedly visited Gundersen shortly after his termination and directed him to “leave town,” according to court papers.

Garner believes the lawsuit may be among the first of its kind in the nation, exposing a new wrinkle to cyberbullying that doesn’t involve vindictive teenagers or vengeful ex-lovers.

“The harassment was not coming from college kids,” he said. “These were seasoned professionals.”

Garner, with a background in business law and litigation, teamed up with attorney Erika Gaspar of Sacramento, an experienced employment lawyer.

“The real question is, what would motivate somebody to do this?” he asked.

Garner and Gaspar believe they have unearthed the answer: competition and spite.

The lawsuit names as defendants Edward D. Jones & Co., along with financial advisers Lisa Rodriguez of Willows and Paul Betenbaugh of Orland, 17 miles to the north.

Betenbaugh, fired by the company in February 2016, admitted to placing two of the ads to get even with Gundersen over a client who had defected.

Rodriguez, who still works at the Willows office, denies playing any part, according to court papers filed by Keesal, Young & Logan of San Francisco.

The Bay Area legal team representing Edward Jones and Rodriguez have characterized many aspects of the case as baseless and point to Betenbaugh’s own admission.

A company spokesman declined to talk about the case while it is being litigated. “As soon as we became aware of it, we terminated the financial adviser involved,” said John G. Boul, manager of global media relations for the company.

To his knowledge, he said, nothing like this had ever happened before. The firm ranked No. 5 on the 2017 list of “100 Best Companies to Work For” by Fortune magazine.

According to more than 600 pages of legal filings, and interviews with Gundersen, local residents and others, here is what allegedly happened.

The ‘taunting’ begins

The empty storefronts in downtown Willows stand out like missing teeth in a smile, visible signs of economic decay in a community where some residents choose to shop in the college town of Chico.

The Edward Jones office occupies a small building sandwiched between a title company and a church on West Sycamore Street. In December 2014, Gundersen was ousted for allegedly violating company policy by failing to confirm trades with clients who had given instructions to his non-registered branch office administrator, according to FINRA documents.

He turned to Garner to represent him in an employment action against Edward Jones.

Garner had joined his father’s established practice in Willows in 2010, with the two sharing a spacious office a block from the Glenn County Courthouse.

Gundersen’s wrongful termination and defamation case went to arbitration before the Financial Industry Regulatory Authority, an independent, non-government regulator which oversees the securities industry. In June of this year, FINRA ruled in favor of Edward Jones.

By then, Gundersen had been replaced at the Edward Jones office in Willows by Rodriguez, 47, who relocated from the company’s office in Corning, 30 miles to the north in Tehama County.

Rodriguez and Betenbaugh were friends, court records show.

Betenbaugh, an Edward Jones financial adviser since 2006, had recruited Rodriguez six years earlier and considered himself her mentor, according to his sworn declaration dated March 1, 2016.

“Over time, Lisa became like a sister to me,” Betenbaugh, now 59, said in his statement.

As is customary, and required by Edward Jones policy, Gundersen was forced to relinquish his accounts and client list to Rodriquez. His so-called “book of business,” which the lawsuit valued at about $150 million, now belonged to Edward Jones and the company’s new face in town.

Per his prior employment agreement, Gundersen was not allowed to reach out to his old clients; they would have to find him. And that, says the lawsuit, was the whole aim of the attack – to get Gundersen to cancel his number, severing a final connection to his old client base.

“The only thing he got to keep when he left was his old cell phone number,” his attorney said.

According to the lawsuit, Rodriguez and Betenbaugh began “taunting” Gundersen around March 2015 by placing a newspaper ad that “capitalized on the fact Gundersen was limited by his pre-employment non-compete agreement with Edward Jones to contact his former clients.”

The ad’s headline read: “Is Your Broker Giving You the Cold Shoulder?”

In a small town, though, word about Gundersen’s move eventually got around.

And loyalties were tested.

Bill Weinrich, 63, a third-generation Willows businessman who runs the local hardware store, said he ultimately severed ties with Edward Jones.

“I just decided to pull the plug,” he said. “I like Dalas. He’s not pushy. I trust him.”

Another longtime resident, Remo William “Bill” Ricci, 69, also was put off by the circumstances.

“All of a sudden one day, Dalas was gone,” said Ricci, a retired mechanic. “This was really a shock.”

Ricci said he and his wife, who has since died, initally met with Lisa Rodriguez about their account but were wary that the fees were too high. He said he decided to write a complaint letter about Rodriguez to Edward Jones and went back to tell her in person, only to find her angry and “rude” and bad-mouthing Gundersen, he said.

Ricci filed the complaint – an event that both sides acknowledge seemed to set the whole impersonation scheme into motion.

According to the lawsuit, Rodriguez and Betenbaugh believed that Gundersen had written the complaint letter himself – an allegation both he and Ricci deny.

“I wrote the letter because I was really upset with Edward Jones,” said Ricci, noting that he did ask Gundersen to review it.

Rodriguez also was upset, according to court papers. Betenbaugh stated in his 2016 declaration that “Lisa (Rodriguez) came to me very upset because a client of Dalas’ submitted a complaint letter to Edward Jones about Lisa.”

“I became equally upset because this negative post could seriously damage her employment and client relations,” he said.

Betenbaugh made a decision.

“Because of my anger at what happened to Lisa, and without Lisa’s knowledge, I took actions which were not honorable and determined to place a post on Chico Craigslist which would annoy Mr. Gundersen.”

The cyber-warfare had begun.

Lawyer turns cyber-sleuth

In the fall of 2015, as the bewildering calls and texts rolled in, Gundersen reached out to his attorney.

Garner recalled how emotional and distraught Gundersen was about the bizarre onslaught, which included pictures of penises suddenly appearing on his business cell phone.

“I couldn’t believe it at first,” Garner said.

“This is not the kind of case I typically do, and there were a lot of lawyers who said to me, ‘Don’t touch it.’ 

Garner said he became aware that cyberbullying cases often are met with indifference from law enforcement, and that penetrating Craigslist and other vehicles used by impersonators can be daunting.

But Garner said he also wondered if there might be some connection to the FINRA case he was handling and felt he had a “duty” to Gundersen to find out.

Soon Garner was “on the hunt,” he said.

He connected with Verizon and Comcast and Craigslist, trying to peel back the identity of the person or persons who had placed the fake ads.

His months-long investigation, which involved subpoenas and court orders to gain access to cable and phone records, led to an email address: dg_69@mail.com. The trail eventually led to a cell phone owned by Betenbaugh.

Along the way, Garner scoured hundreds of phone numbers and discovered that the perpetrator had been using a router owned by an Orland building landlord, a small family-owned business located near the Edward Jones office.

Tim Crews, editor and publisher of the twice-weekly Sacramento Valley Mirror, said residents were particularly upset by this “level of sneakiness.”

“When people found out that they were using the mom-and-pop’s wi-fi to try and disguise their tracks – man, that’s like, ‘You leave grandma and grandpa alone,’ ” he said.

“I’m not naïve about living in a small county of 27,000 people. Things happen,” Crews said. “But I was really disappointed in this. I still am.”

Garner said the attacks were reported to the Glenn County district attorney, but he said he ultimately decided to forge ahead with his own investigation and build a civil case.

Getting law enforcement to investigate cyberbullying is a common obstacle, especially in areas lacking resources and trained expertise, said Sameer Hinduja, an expert in cyberbullying at Florida Atlantic University.

“It’s not that law enforcement doesn’t care,” said Hinduja, noting that small departments often are besieged by other crimes.

Garner said he believes the state’s penal code addresses what happened to Gundersen. In California, for instance, internet or electronic impersonation with the purpose of “harming, intimidating, threatening, or defrauding” another person is punishable by up to a $1,000 fine and one year in the county jail, or both.

Defense pushes back

Two years into the lawsuit, the paperwork is flying at the Glenn County Courthouse. In filings, Edward Jones has stood by the integrity of the company and Rodriguez.

San Francisco attorneys Julie Taylor and Ian Ross contend in court papers that Betenbaugh’s conduct is “clearly the focus of this dispute,” and that naming Edward Jones and Rodriguez as defendants isn’t supported by the evidence. They argue that Edward Jones and Rodriguez were dragged into the lawsuit to “deepen the defense’s ‘pockets.’ 

The company acknowledged that Rodriguez and Betenbaugh had placed the “cold shoulder” ad – with company approval, court records show.

The attorneys deny, however, that the company failed to supervise its financial planners, or allow them to operate without guidance or policies.

The case is lumbering forward. In May, a Glenn County judge denied the defense request to have the case moved to Sacramento. In her declaration, Rodriguez stated that she has lost clients because of the negative publicity. Betenbaugh has a new financial advising practice in Orland.

Gundersen said he is still trying to cobble together his business but estimates he’s handling only about 20 percent of the assets he previously managed. He admits that he was tempted to leave Glenn County, but he and his wife have remained.

On one recent Thursday, he arrived at work in his blue-and-gold Rotary dress shirt, in preparation for the regular meeting. Rodriguez, also a Rotarian, has continued to attend the same meetings.

“It’s such a strange road from where I was,” he said.

Marjie Lundstrom: 916-321-1055, @MarjieLundstrom