A Madison County judge has issued a permanent injunction against Tornado Masters, saying the company used deceptive practices, selling storm shelters to local customers.
Judge Dennis O'Dell issued the ruling Tuesday afternoon, which effectively puts Tornado Masters out of business. He also ordered to consolidate the preliminary hearing with the final trial, which means immediate judgment was rendered and that the civil case is now closed.
Alabama Attorney General Luther Strange ordered a freeze on all of Tornado Masters of Alabama’s business activities, and prosecutors then took the case before Judge O'Dell on March 16. Prosecutors said many of the shelters manufactured by Tornado Masters had life-threatening defects, with false advertising also being alleged.
The owners listened to testimony by at least eight customers who described nightmare experiences with the company as they tried to get FEMA-compliant tornado shelters installed to protect them from an EF-5 tornado.
Defense attorneys called only one witness in the hearing, an engineering expert who they hoped would discredit the State Attorney General's licensed engineer who testified he inspected a dozen shelters around the Tennessee Valley and found many of them to be unsafe.
In Tuesday's order, Judge O'Dell wrote there is substantial evidence the shelters do not exceed, nor do they meet FEMA 320 safety guidelines. These are government-issued standards designed to protect someone taking shelter from an EF-5 tornado.
The defendants, Leslie and Grady Holt, also claimed they were fully licensed and their shelters were tested at Texas Tech University. The judge ruled both statements were not true.
The Court also found evidence the Holts claimed grants bearing a USDA seal had been awarded to customers, deceiving people into believing the federal government had awarded them money and approved their shelters. This was not the case either.
Prosecutors say they suspect there are hundreds of unsafe storm shelters around the Tennessee Valley, but they don't believe the company has the assets to reimburse past customers or fix the unsafe shelters. Customers paid Tornado Masters anywhere from $2,000 to $10,000 for these shelters. The judge said evidence shows Tornado Masters sold approximately 220 shelters in 2011.
Better Business Bureau President Michele Mason said Tuesday's judgment doesn't necessarily mean compensation for customers. Tornado Masters was ordered to reimburse all affected customers, along with $30,000 in civil fines. The company's assets and bank accounts also remain frozen.
"We're still not sure what this means for existing customers," said Mason. "We are certainly listening to see what's going to be the next step. We don't know what was secured in assets, and if anything will be able to be returned to these customers."
Do you have a shelter installed by Tornado Masters? Please read this story.
With the injunction, the Holts are permanently prohibited from being involved in future involvement selling tornado shelters to customers. This includes design, construction, manufacturing, advertising, selling, delivery and installation.
Banks are also ordered to freeze the defendants' funds.
We'll have more coverage of this developing situation Tuesday on WHNT News 19 at 5:00 and 6:00 p.m.