After $1M judgment against him, Orem mayor now sues ex-daughter-in-law

OREM — Orem Mayor David Young — who was ordered by an Alabama court to pay a $1 million judgment against him last year — is now suing his former daughter-in-law and an Alabama man for what he claims was an illegal scheme designed to defraud him and his real estate company.

At the heart of the complicated situation is a series of loans the mayor's son Shawn Young received while he was living in Alabama and working for his father's company, Torch13. The loans came from Shawn Young's neighbor, Ross Gagliano, in 2017 and 2018, totaling $285,000. The loans were never repaid, and Gagliano sued Shawn Young, David Young and Torch13, the real estate venture the Orem mayor owned.

Following a trial in May 2022, David and Shawn Young and their company were ordered by an Alabama judge to pay more than $1 million in the fraudulent business loan case.

Alabama Circuit Court Judge Pat Ballard lambasted the Orem mayor, calling David Young a "lynchpin to this fraud," and said he "displayed an extreme lack of credibility" during the trial. "The indisputable facts and his own documents showed him to be an essential participant in the fraud," the judge said, adding that David Young conspired with his son to support the fraud.

"David Young, despite a pretense as a businessman, ran Torch13 LLC as a personal tool and piggybank for his joint efforts with Shawn Young, and even went so far as to provide Shawn Young money from Torch13 LLC so that Shawn Young could implement his 'gambling plan' at various casinos," the judge said, ordering them to repay the loans and pay punitive damages.

But David Young's Utah lawsuit claims that the Alabama judge relied on false testimony from Gagliano and from his former daughter-in-law — who was married to Shawn Young until last year and is the mother of three of his grandchildren. Candace Graehl and Shawn Young are in the midst of a custody battle that has yet to be decided.

The lawsuit claims Gagliano and Graehl conspired against him and committed perjury "with the intent that the Alabama court would enter a judgment against Young/Torch13 for the loans."

The mayor claims that Gagliano and Graehl "each had a common financial interest" in providing what he says was false testimony, but doesn't specify what Graehl's alleged financial benefit would be.

The lawsuit seeks a judgment of $300,000, double damages to be determined at trial, plus costs and attorney fees.

Graehl's attorney Steven Wall said Graehl denies the allegations made against her. "There is not a basis in fact or law to grant the relief that they're seeking," Wall said of the lawsuit.

David Young is appealing the Alabama ruling, saying he wants "unbiased judges" to hear his case. "From any kind of logic, the entire thing is a lie," he said about the $1 million judgment against him. That appeal is being processed, but David Young said he expects it could be argued in the fall.

Judge calls Orem mayor 'lynchpin' in fraud case, orders him and son to pay $1M

Orem Mayor David Young and his son have been ordered by an Alabama judge to pay $1 million in a fraudulent loans case. The judge called the Utah mayor "a lynchpin to this fraud."

The mayor's lawsuit

David Young's lawsuit, filed on Jan. 6, insists that his son was hired only as a salesman for Torch13 and he received commissions for the sale of houses for the company. A portion of his commissions was to be used to "repay various bookies and casinos for Shawn's gambling debts."

Gagliano's lawsuit from 2021 alleges that the Orem mayor gave Shawn Young authority to engage in financial activities on behalf of Torch13.

Shawn Young and his wife and three children lived in a home purchased by Torch13 in Pelham, Alabama, across the street from Gagliano and they became friends.

The Utah lawsuit claims Gagliano approached Shawn Young about the two of them starting a "secret house flipping business in competition with Torch13." The suit quotes a deposition in which Shawn Young said that if he did something on his own, he could keep more of the profits for himself, rather than paying off debts through his father.

The mayor's lawsuit alleges that Gagliano knew of Shawn Young's gambling tendencies and still gave loans to fund their secret business directly to Shawn Young — not to the mayor or his company — through verbal agreements, against the advice of his financial advisers. It also says the two used resources and money from Torch13 to compete against the Utah business with their secret business.

This is in contrast to Gagliano's testimony in the Alabama lawsuit that he did not know about the gambling addiction and that the loans were given to Shawn Young on behalf of Torch13. In Gagliano's lawsuit, he claimed the mayor met with him in February 2018 and assured him the loans would be repaid, leading to Gagliano loaning more money.

David Young said he was not aware of the loans made by Gagliano to Shawn Young or of the alleged secret business until May 2019 when Shawn disclosed to his father details of the business and that he lost the $200,000 in loans by gambling, the lawsuit states.

David Young's lawsuit does contain a line that mentions Torch13 wiring Gagliano $50,000 in 2017 after Gagliano had loaned $85,000 at that point. The suit doesn't say why Torch13 paid him that $50,000, but says "Gagliano later falsely claimed that (David) Young acknowledged his responsibility for the repayment of the loans by making partial payments of Shawn's commissions toward the loans that had not been disclosed by Gagliano to Young or to Torch13."

But it was that $50,000 payment from Torch13 that the Alabama judge specifically said was an indication that Shawn Young was acting on behalf of David Young and Torch13, and not on his own.

David Young told KSL.com the $50,000 was money his son earned through commissions as an employee. Torch13 was going to send it to Shawn Young, but he asked his father to send it directly to Gagliano for money he owed him.

David Young says Gagliano called him in May 2020 and said he had loaned his son $200,000 against his better judgment. "Gagliano also explained to (David) Young, 'I know you're not responsible for this, I know it has nothing to do with you, but I'd really appreciate it if you would pay this $200,000," according to the Orem mayor's lawsuit.

He said in the lawsuit that he told Gagliano that neither he nor Torch13 were responsible for the loans, that he was foolish to loan money to his son because of his son's gambling addiction, and that doing so "set in action a gambling disaster, and that Gagliano interfered with and destroyed Torch13."

David Young told KSL.com that Torch13 was shut down around 2018 and flipped about 60 houses during its operation. Young said he personally financed all 60 of those homes and he "never borrowed a dime from anyone."

Perjury allegations

The mayor's lawsuit claims Gagliano and Graehl knew Shawn Young was unable to pay the loans back and so they "concocted a false theory of Gagliano's case and ginned up perjured testimony to support it so Gagliano could try and recover from Torch13 and/or (David) Young."

"In short, they needed a deep pocket into which they could slip their hands and obtain funds to repay Shawn's loans," the lawsuit states.

David Young alleges that his former daughter-in-law began communicating with Gagliano in early 2020 while she was still married to Shawn Young but had filed for divorce. He claims Gagliano filed the Alabama lawsuit after securing a promise from Graehl that she would travel to Alabama to "provide false testimony."

The lawsuit says Graehl perjured herself by testifying that her husband told her the loans from Gagliano were for an investment in Torch13's real estate operations, and Gagliano had previously loaned money and had been paid back.

The mayor's lawsuit says Gagliano perjured himself by testifying that he made loans for investments into Torch13, that he had received David Young's approval to invest, and that he had no idea about Shawn Young's gambling addiction.

David Young was sworn in as the mayor of Orem in January 2022.

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