Businessman, Using 'Sovereign' Tactics, Loses Control of Pizza Chain

This is a story for the "So you thought rich business owners are smarter than you are" file.

A man who epitomizes the American dream – a Greek immigrant who started out as a cook in a Giordano's Pizza restaurant in Chicago and rose to become owner of the 45-location chain – is on the verge of losing it all, in part because he has resorted to pseudo-legal tactics favored by antigovernment "sovereign citizens."

John Apostolou has owned Giordano's since 1988, but a bankruptcy judge last month seized control of the business and banned Apostolou from the premises. The trustee appointed to run the business as it deals with its $45.5 million bank debt told the court: "Because of certain perspectives that the Apostolous have … they have done a few things that merit this court's attention. … Perhaps it contributed to the lack of confidence that creditors have and certainly were part of the reason that I wanted them removed as fiduciaries."

What Apostolou did to "merit the court's attention," according to the Chicago Tribune, was to file legally bogus affidavits in court. One asserted that he and his wife, who co-owns the business, don't recognize U.S. currency and are free of any legal constraints. Another sought to terminate Apostolou's bankruptcy by alleging bank fraud and other misdeeds.

It's ironic that an ambitious immigrant who made his fortune in the United States now claims he isn't subject to its legal authority. Sovereign citizens generally believe they can remove themselves from the jurisdiction of state and federal government, so that they don't need to pay taxes or use any form of government documentation such as driver's licenses or automobile license tags. Some sovereigns believe they can discharge debts by accessing secret accounts supposedly created by the government in their names at birth. A number of high-profile people have attempted to dodge taxes and other debts by claiming sovereign status, but none have prevailed. Most notably, actor Wesley Snipes is serving a three-year prison sentence for failing to file federal tax returns, after claiming sovereign status as a "non-resident alien" despite being a U.S.-born citizen. Some sovereigns have resisted police authority with violence.

Apostolou's various businesses, including Giordano's, apparently ran into trouble in part due to poor accounting procedures and a "lack of proper management oversight," as well as the owners using the business as "a personal piggy bank," bankruptcy trustee Philip Martino told the court. But that was only the beginning of Apostolou's problems. According to the Tribune, Apostolou turned for advice to a man named Marshall Home, a sovereign citizen who Apostolou believed could help people fend off "illegal" foreclosures. Apostolou said he and his wife didn't know what they were signing as they filed documents provided by Home. Yet in his interview with the Tribune, Apostolou expressed continued confidence that Home's machinations might yet save his business.

In one document, the Apostolous declared themselves "American Freemen, free inhabitants of the Illinois state, and we find it impossible to obtain State declared Legal Tender at Law," the newspaper reported. Their bankruptcy attorney withdrew from the case shortly thereafter, citing "irreconcilable differences" with Apostolou. That prompted the court to order a trustee to take control of the company. Apostolou then filed documents with the court seeking to terminate the bankruptcy due to "bank fraud, securities fraud and tax fraud by the United States" and asserting that "all contracts" with the court are "cancelled for lack of valuable consideration." Apparently, someone connected to the Apostolous even called the local sheriff attempting to have Martino, the trustee, arrested, the newspaper reported.

Home has not been a passive bystander: He filed papers with the bankruptcy court claiming to have a $150 million lien against Giordano's – apparently part of a scheme to get the pizza chain back for the Apostolous. "My claim is solid, legal and secured," Home told the Tribune. "I will be in control of the business. You can count on it."

Apostolou, apparently, is still counting on it, telling the Tribune that Home's claim should take precedence over all other claims, and that if he and Home are successful, Home would get a piece of the business. Given the 100 percent failure rate of all similar sovereign challenges to government authority, one can't avoid the feeling of witnessing an attempted con job as it crashes and burns, taking an American success story with it.