SEC v. RANDALL J. MILLER; CHAD J. MILLER; and JEFFREY DE LAVEAGA, No. 1:25-cv-02702, Southern District of New York (Apr. 2, 2025) — Complaint

1
MONIQUE C. WINKLER
JASON H. LEE
DAVID ZHOU
JASON BUSSEY
WILLIAM SALZMANN
JONATHAN GRANT
Attorneys for Plaintiff
SECURITIES AND EXCHANGE
COMMISSION
44 Montgomery Street, Suite 700
San Francisco, CA 94104
Telephone: (415) 705-2500
Facsimile: (415) 705-2501
Email: [email protected]; [email protected];
             [email protected]
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
SECURITIES AND EXCHANGE
COMMISSION,
Plaintiff,
            v.
RANDALL J. MILLER, CHAD J. MILLER,
and JEFFREY DE LAVEAGA
Defendants.
COMPLAINT
1
:25-cv-02702
JURY TRIAL DEMANDED
Plaintiff Securities and Exchange Commission (the “Commission”), for its complaint
against Defendants Randall J. Miller, Chad J. Miller, and Jeffrey De Laveaga, alleges as follows:
SUMMARY
1.This matter involves the fraudulent scheme to offer and sell approximately
$284 million in municipal bonds, now defaulted, issued for the benefit of Legacy Cares, Inc.
(“Legacy Cares”), an Arizona nonprofit corporation in August 2020 and June 2021. Legacy
Cares issued the bonds through the Arizona Industrial Development Authority, an Arizona state
entity known as a “conduit issuer,” which issues municipal bonds for third-party borrowers, such

2

as Legacy Cares. Randall (“Randy”) Miller founded and incorporated Legacy Cares for the
purpose of issuing the bonds.
2. The bond proceeds were used by Legacy Cares to finance the construction of a
multi-sports park and family entertainment center (the “Sports Complex”) in Mesa, Arizona. The
Sports Complex was operated by Legacy Sports USA, LLC (“Sports USA”), which was founded
by Randy Miller.
3.  To market the bonds to investors, the underwriter for both bond offerings (the
“Underwriter”) distributed limited offering memoranda for the 2020 and 2021 bond offerings.
Both the 2020 and 2021 offerings were for revenue bonds, which meant that the cash required to
pay interest and principal back to the bondholders was to come from the revenue generated by
the Sports Complex after it opened in 2022. The limited offering memorandum for the 2020
bond offering (the “2020 Offering Memorandum”) included financial projections anticipating
revenue that was multiple times the amount needed to cover the payments to investors in the
2020 bonds. These financial projections were prepared at the direction of Randy Miller’s son,
Chad Miller, with input from Jeffrey De Laveaga, an executive at Sports USA.
4. The financial projections in the 2020 Offering Memorandum were false and
misleading. The revenue anticipated in the financial projections was based on indications of
interest in the Sports Complex, and was purportedly evidenced by dozens of “letters of intent”
that were attached to the 2020 Offering Memorandum and therefore provided to investors. These
letters purported to be from various sports clubs, leagues, and other entities expressing the intent
to move their events or operations to the Sports Complex. The 2020 Offering Memorandum
referenced the letters throughout the document as the basis for the revenue expectations, and
included the letters as an attachment.
5. However, the majority of the more than 50 letters of intent were either totally
fabricated or materially altered in some fashion, including the forging of signatures, by Randy
Miller, Chad Miller, and De Laveaga in the months leading up to the 2020 bond offering. Each

3

Defendant knew or was reckless in not knowing that he was creating false documents, and that
the documents would be disseminated to investors.
6. In addition to the fabricated letters of intent, Defendants also, knowingly or
recklessly, collaborated to create a set of 25 so-called “pre-contracts,” which, like the letters of
intent, are referenced throughout the 2020 Offering Memorandum as supporting the revenue
expectations. The 2020 Offering Memorandum represented that the pre-contracts constituted
“binding” arrangements with Sports USA to use the Sports Complex and pay fees. The pre-
contracts were listed in the 2020 Offering Memorandum, and copies of the pre-contracts
themselves were provided directly to potential investors prior to the sale of the 2020 bonds
through an online investor “data room” hosted by the Underwriter (the “investor data room”).
These pre-contracts were purportedly signed by some of the same sports leagues and entities
falsely identified as having previously submitted letters of intent. Like the fabricated letters of
intent, however, most of the pre-contracts were fake.
7. The limited offering memorandum for the 2021 bond offering (the “2021 Offering
Memorandum,” and, together with the 2020 Offering Memorandum, the “Offering Memoranda”)
incorporated the same false projections, letters of intent, and pre-contracts from the 2020
Offering Memorandum.
8. The Sports Complex opened in January 2022 with far fewer events and much
lower attendance than had been falsely projected in the Offering Memoranda. The Sports
Complex generated less than $28 million in revenue for the year, in contrast to the $96 million
year-one revenue projected in the Offering Memoranda.
9. Due to this revenue shortfall, in October 2022, when it came time to begin
repayment to the bondholders, Legacy Cares defaulted on both the 2020 and 2021 bonds. Legacy
Cares subsequently filed bankruptcy proceedings in May 2023 and the Sports Complex is now
owned by a new entity. According to bankruptcy filings, the investors’ bankruptcy claim
recouped through the bankruptcy less than $2.5 million of the $284 million they had invested.

4

10. As a result of the conduct described above, Randy Miller, Chad Miller, and De
Laveaga each violated Section 10(b) of the Securities Exchange Act of 1934 (“Exchange Act”)
[15 U.S.C. § 78j(b)] and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5], and Section 17(a) of the
Securities Act of 1933 (“Securities Act”) [15 U.S.C. § 77q(a)].

NATURE OF THE PROCEEDINGS AND RELIEF SOUGHT
11. The Commission brings this action pursuant to the authority conferred upon it by
Sections 20(b), 20(d), and 22(a) of the Securities Act [15 U.S.C. §§ 77t(b), 77t(d), and 77v(a)],
and Sections 21(d), 21(e), and 27 of the Exchange Act [15 U.S.C. §§ 78u(d), 78u(e), and 78aa].
12. The Commission seeks a final judgment against Defendants Randy Miller, Chad
Miller, and De Laveaga: (a) permanently enjoining Defendants from violating the federal
securities laws and rules that this complaint alleges they have violated; (b) permanently
enjoining Defendants from, directly or indirectly, including, but not limited to, through any
entity owned or controlled by them, participating in the issuance, purchase, offer, or sale of any
security, provided, however, that such injunction shall not prevent Defendants from purchasing
or selling securities for their own personal accounts, pursuant to Section 20(b) of the Securities
Act [15 U.S.C. § 77t(b)] and Sections 21(d)(1) and 21(d)(5) of the Exchange Act [15 U.S.C. §§
78u(d)(1) and 78u(d)(5)]; (c) ordering Defendants to pay disgorgement with prejudgment
interest, pursuant to Sections 21(d)(3), 21(d)(5), and 21(d)(7) of the Exchange Act [15 U.S.C. §§
78u(d)(3), 78u(d)(5), and 78u(d)(7)]; (d) ordering Defendants to pay civil money penalties
pursuant to Section 20(d) of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d)(3) of the
Exchange Act [15 U.S.C. § 78u(d)(3)]; and (e) ordering any other and further relief the Court
may deem just and proper.

5

JURISDICTION AND VENUE
13. This Court has jurisdiction over this action pursuant to Sections 20(b), 20(d),
20(e), and 22(a) of the Securities Act [15 U.S.C. §§ 77t(b), 77t(d), 77t(e), and 77v(a)] and
Sections 21(d), 21(e), and 27 of the Exchange Act [15 U.S.C. §§ 78u(d), 78u(e), and 78aa].
14. Defendants Randy Miller, Chad Miller, and De Laveaga, directly or indirectly,
made use of the means and instruments of interstate commerce or of the mails in connection with
the acts, transactions, practices, and courses of business alleged in this complaint.
15. Venue is proper in this District pursuant to Section 22(a) of the Securities Act [15
U.S.C. § 77v(a)] and Section 27(a) of the Exchange Act [15 U.S.C. § 78aa(a)]. Acts,
transactions, practices, and courses of business that form the basis for the violations alleged in
this complaint occurred in this District. For example, certain investors in both the 2020 and 2021
bonds reside in this District and accessed offering documents in this District, and the clearing
agency and securities depository that facilitated the transfer of both the 2020 and 2021 bonds is
located in this District.

DEFENDANTS
16. Randall J. Miller, age 70, is a resident of Maricopa County, Arizona. At all
relevant times, Randy Miller was the founder, Chairman, and Managing Member of Sports USA.
He also founded and incorporated Legacy Cares.
17. Chad J. Miller, age 40, is a resident of Maricopa County, Arizona. Chad Miller
is the son of Randy Miller. At all relevant times, Chad Miller was the CEO of Sports USA.
18. Jeffrey De Laveaga, age 55, is a resident of Maricopa County, Arizona. At all
relevant times, De Laveaga was the Chief Operating Officer of Sports USA.

RELATED ENTITIES
19. Legacy Cares, Inc. is an Arizona nonprofit corporation and a 501(c)(3)
organization formed by Randy Miller to develop, own, and operate sports and family

6

entertainment facilities. Legacy Cares’ principal place of business is in Mesa, Arizona. Legacy
Cares was the conduit borrower for the bonds at issue in this complaint. On May 1, 2023, Legacy
Cares filed for Chapter 11 bankruptcy and is currently in a liquidation trust.
20. Legacy Sports USA, LLC is an Arizona limited liability company and was the
manager of the Sports Complex, and each of the Defendants was employed as an officer of
Sports USA. Sports USA’s principal place of business is in Scottsdale, Arizona. Shortly before
Legacy Cares’ bankruptcy filing, Sports USA ended its role as the Sports Complex’s manager
and ceased all operations.
21. Arizona Industrial Development Authority (the “Arizona Authority”) is a
political subdivision of the state of Arizona and an Arizona nonprofit corporation. The Arizona
Authority served as the conduit issuer for the 2020 and 2021 bonds.

FACTS
I. Background
22. Prior to 2020, Randy Miller attempted for several years to develop other sports
parks concepts by seeking private loans or investor funding. After proposing at least three
different locations in the Phoenix area but failing to attract sufficient funds, he began to pursue
the use of municipal bonds to finance the construction of the Sports Complex in Mesa, Arizona.
23. In August 2020, the Arizona Authority acted as the conduit issuer for the sale of
$250.8 million of economic development revenue bonds for the construction of the Sports
Complex. The Arizona Authority acted solely as the conduit issuer with no responsibility for
making interest and principal payments on the bonds. According to the 2020 Offering
Memorandum, Legacy Cares was responsible for making payments to bondholders and would do
so using revenue generated by the Sports Complex.
24. The conduit borrower on the transaction was Legacy Cares. Randy Miller
incorporated Legacy Cares as an Arizona non-profit entity so it could qualify as the conduit

7

borrower for the municipal bond offerings and facilitate a portion of the bonds being issued on a
tax-exempt basis as qualified 501(c)(3) bonds.
25. Randy Miller set up Legacy Cares to operate as an independent shell for the sole
purpose of issuing the bonds, and Legacy Cares retained Sports USA as a for-profit entity to
serve as the Sports Complex’s manager. Accordingly, Legacy Cares contracted with Sports USA
to oversee the construction of the Sports Complex and manage the facility’s subsequent
operations. Sports USA, through the Defendants, also had the critical function of providing
information about the Sports Complex for use in the Offering Memoranda, including the
preparation of the financial projections and supporting documentation provided to investors.
26. For its role, Sports USA was to receive a variety of payments from the Sports
Complex, including 5% of all capital expenditures upfront as a “development fee,” 7% of all
revenue as a “basic fee,” 5% of all gross profits as an “incentive fee,” and then additional
guaranteed monthly “accounting fee[s]” and expense reimbursements.
27. In June 2021, Randy Miller and Chad Miller sought additional funding for the
Sports Complex through municipal bonds, and the Arizona Authority ultimately issued an
additional $33 million of revenue bonds, also for the construction of the Sports Complex. Once
again, according to the 2021 Offering Memorandum, Legacy Cares bore the sole responsibility
for making payments to bondholders and would do so using the Sports Complex’s revenue.
28. As, respectively, Chairman and Chief Executive Officer of Sports USA, both
Randy Miller and Chad Miller had controlling authority over Sports USA at all relevant times.
De Laveaga served as Sports USA’s Chief Operating Officer and was paid a consulting fee by
Sports USA during the relevant period.
29. The Sports Complex was designed to be one of the largest of its kind in the
United States, consisting of over 300 acres of indoor and outdoor sports fields, courts, locker
rooms, a 10,000-person capacity stadium, office spaces, restaurants, and other entertainment
options. The size and cost of the Sports Complex meant that, to be successful, it would need to

8

be fully utilized for events and activities spanning many different types of sports, such as
baseball, football, soccer, volleyball, pickleball, basketball, e-sports, and CrossFit.
II. Defendants Knowingly or Recklessly Made Materially False and Misleading
Statements to Investors in the 2020 Bond Sale.
30. In the 2020 Offering Memorandum, and in other communications with investors,
Defendants presented investors with false and misleading projected revenue and other
information designed to provide assurances that the Sports Complex would generate the revenue
necessary to make timely bond payments. Specifically, Defendants projected that the Sports
Complex would generate over $96 million in revenue in its first year of operation. Defendants
supported this high revenue number with representations that the venue would be nearly fully
booked consistently starting from the opening day.
31. Throughout the 2020 Offering Memorandum, Defendants claimed to support the
revenue projections with two independent feasibility studies, as well as detailed spreadsheets that
broke down projected revenue by type of sport. The underlying support for the revenue
projections supposedly came from more than 50 letters of intent, purportedly from various sports
organizations and leagues that had pledged to move events or operations to the Sports Complex.
32. In reality, Sports USA had not generated anywhere near enough interest from
sports organizations to support the revenue projections. Rather, Defendants, knowingly or
recklessly, fabricated or materially altered the majority of the letters of intent to make it appear
that the Sports Complex would be fully committed in its first year of operation. These false
documents, in turn, served as the bases for the other false and misleading representations to
investors, including the 2020 Offering Memorandum’s revenue projections, information in a
“peer review” study conducted by an outside consultant that was included in the 2020 Offering
Memorandum, and further false so-called “pre-contracts” that purported to be binding
agreements with sports entities for the use of the Sports Complex and the payment of fees.

9

A.  Fabricated and Altered Letters of Intent
33. The letters of intent prepared by Defendants were purportedly from a wide array
of local, national, and international sporting organizations, including several world-renowned
national and international sports institutions. Many of the purported letters expressed an intent to
move certain games, leagues, or tournaments to the Sports Complex, while others stated that
their organizations would be moving their entire operations there. Certain of the letters included
specific attendance and revenue projections for events to take place at the Sports Complex.
34. In the year leading up to the offering of the 2020 bonds, Defendants knowingly or
at least recklessly fabricated or materially altered the majority of the letters of intent. Some of the
letters were entirely fake, with the phony documents including, among other things, incorrect
letterhead from outdated sources, forged signatures, and incorrect or misspelled signatories. The
creation and gathering of the fraudulent letters of intent was a collaborative effort by Defendants,
who communicated with each other instructions and shared drafts of fake documents. All three
Defendants personally fabricated false documents. In some instances, Randy Miller directed
Chad Miller to change the dates on some of the older letters of intent. In others, Chad Miller
instructed or coordinated the creation of false letters of intent by De Laveaga and others working
at their direction for Sports USA.
35. For example, one fabricated letter, which falsely described the entity as having
committed to move an annual event to the Sport Complex, included a phony letterhead,
misidentified the name of the sports organization that purportedly issued the letter, and
misspelled the last name of the purported signatory. Another fake letter, which falsely stated that
the organization had committed to use the Sports Complex for its events, misidentified the name
of the sports organization that purportedly issued the letter, and misspelled the name of the
purported signatory of the letter.
36. Chad Miller then knowingly, or recklessly, provided the false letters of intent to
the Underwriter for inclusion as an attachment to the 2020 Offering Memorandum. Chad Miller
also provided the false letters of intent to be included in the Underwriter’s investor data room.

10

This investor data room was used by both potential bond investors and other bond participants to
evaluate the bonds in the weeks prior to the 2020 bond offering.
B.  Fabricated Pre-Contracts
37. Chad Miller, and others working at his direction, also fabricated so-called “pre-
contracts” representing commitments from sports providers and caused these false documents to
be provided to investors in connection with the offering of the 2020 bonds. Randy Miller
reviewed the pre-contracts before they were provided to investors.
38. Chad Miller knowingly or recklessly fabricated, and directed the fabrication of,
the pre-contracts because the dates on some of the letters of intent were stale and the Underwriter
for the bonds had requested that Sports USA obtain additional communications from the
purported letter writers that were more current and that reflected a further level of commitment
from those entities. In response to this request, Chad Miller, with others at Sports USA working
at his direction, fabricated pre-contracts with false signatures from some of the entities that had
purportedly signed the letters of intent. The pre-contracts falsely stated that they constituted
“binding agreement[s]” between Sports USA and the entities to enter into “formal use
agreement[s]” to hold events at the Sports Complex within 90 days of groundbreaking. Randy
Miller and Chad Miller knew, or were reckless in not knowing, that the “agreement[s]”
represented by the fake pre-contracts were fictitious, and that these documents were created for
the purpose of deceiving bond investors. Chad Miller provided the pre-contracts to the
Underwriter, and these fake documents were also included in the investor data room in the weeks
prior to the offering of the 2020 bonds.
C. False and Misleading Projected Revenue
39. The 2020 Offering Memorandum is replete with references to the fabricated
letters of intent and pre-contracts to assure investors of potential revenue and the viability of the
Sports Complex.
40. Notably, the 2020 Offering Memorandum included projected financial
information, including a “Summary Five-Year Pro Forma” financial statement detailing the

11

expected revenue and expenses for the first five years of the Sports Complex’s operation, starting
in 2022. According to this pro forma financial statement, the Sports Complex was expected to
generate over $96 million in revenue in 2022, which was multiple times the amount owed in
payments to bondholders that year. The pro forma financial statement was prepared at the
direction of Chad Miller in the weeks prior to the offering of the 2020 bonds. Chad Miller and
De Laveaga then reviewed and approved the pro forma statement before providing it to the
Underwriter for inclusion in the 2020 Offering Memorandum.
41. As Defendants knew, or were reckless in not knowing, the projected revenue in
the pro forma financial statement was false and misleading because it was based on the false
letters of intent and pre-contracts.
D.  False and Misleading “Peer Review & Impact Analysis” Relying on the
Fabricated Letters of Intent
42. Chad Miller also knowingly or recklessly provided the false financial projections
and fake letters of intent to an unknowing outside consultant (the “Peer Review Consultant”),
which used that information to put together a report that was generally supportive of Sports
USA’s misleading revenue projections. That report was attached to the 2020 Offering
Memorandum.
43. In or around 2016, Randy Miller and Sports USA engaged an outside consultant
(the “Feasibility Consultant”) to conduct a feasibility study of one of Sports USA’s earlier
sports-park proposals, which would have been located in Phoenix rather than Mesa. The
Feasibility Consultant estimated that the potential first-year annual revenue for that project
ranged from $29 million up to, with caveats, $38 million.
44. At the Underwriter’s suggestion, Chad Miller engaged a peer-review consultant to
conduct a “Peer Review & Impact Analysis” (the “peer review”) which examined the
methodology of the earlier feasibility study, but updated it by applying the more recent revenue
projections specifically relating to the Sports Complex’s Mesa location. As explained in detail
above, those projections, which were directed and approved by Chad Miller and De Laveaga,

12

were based on the false letters of intent, which were themselves also provided to the Peer Review
Consultant through the investor data room. On its face, the peer review made clear that its
calculations were dependent on the Peer Review Consultant’s assumption that “all” of the letters
of intent were accurate.
45. The 2020 Offering Memorandum attached the peer review as an appendix. In it,
the Peer Review Consultant concluded that the Sports Complex would generate approximately
$84 million in first-year revenue. Although this amount was lower than the corresponding figure
in Sports USA’s pro forma financial statement, which estimated $96 million of first-year
revenue, it was still multiple times more than the amount necessary to meet Legacy Cares’ bond
payment obligations to investors. As Defendants knew, or were reckless in not knowing, the peer
review presented to investors in the 2020 Offering Memorandum was based on materially false
and misleading revenue projections and false letters of intent.
E.  False Statements Made on Bond Investor Webinar
46. In July 2020, a few weeks before the offering of the 2020 bonds, Chad Miller and
De Laveaga participated in a webinar hosted by the Underwriter and attended by potential
investors. In this webinar, Chad Miller falsely stated that the entire Sports Complex was pre-sold
to be “over 90% occupancy” by day one of opening. He further misleadingly stated that the
projected revenue and occupancy rate were supported by the letters of intent—the same
documents that he had helped to fabricate and alter. Similarly, De Laveaga misleadingly told
investors in the webinar that the Sports Complex would be sold out before it even opened its
doors.
47. Both Chad Miller and De Laveaga knew, or were reckless in not knowing, that
their statements were false and misleading, and that the statements were based on the false
revenue projections and false documents that Defendants had created.

13

III.     The 2021 Offering Memorandum Incorporated the Same False Statements from the
2020 Offering Memorandum.
48. The second offering occurred in June 2021 when the Arizona Authority issued
$33 million of additional bonds, also to be used to construct the Sports Complex. The 2021
Offering Memorandum incorporated the entire 2020 Offering Memorandum, including the false
and misleading revenue projections, misleading peer review, the fabricated letters of intent, and
descriptions of the fabricated pre-contracts. Accordingly, the false and misleading statements
described above regarding the 2020 bonds apply equally to the 2021 bonds.
IV. Defendants Acted Knowingly or Recklessly to Deceive Bond Investors.
49. The scheme to offer and sell the bonds through the use of false and misleading
financial projections, the false letters of intent and pre-contracts, and the misleading peer review,
was conducted knowingly or recklessly by Defendants. Notably, Defendants acted with scienter
in fabricating and altering numerous letters of intent and pre-contracts, which they knew, or were
reckless in not knowing, would be provided to potential investors. Defendants further knew, or
were reckless in not knowing, that the financial projections that they created for the offerings
were false and misleading because they were based on false letters of intent and false pre-
contracts.  Defendants also knew, or were reckless in not knowing, that the peer review was
based on the fake letters of intent. In addition, Chad Miller and De Laveaga knew, or were
reckless in not knowing, that the statements they made during the investor webinar were based
on false projections and false documents.
50. Defendants’ misrepresentations were material to a reasonable investor, as well as
actual investors, in the 2020 bonds and 2021 bonds. The revenue projections and peer review in
the Offering Memoranda were important to investors when deciding whether to purchase the
bonds because the bonds were revenue bonds and, as a consequence, interest and principal
payments would be made from the Sports Complex’s revenue. The letters of intent and pre-
contracts, which were the underlying basis for the revenue projections and peer review, were also
important to investors.

14

V.   The Proposed Defendants Personally Profited from the Fraud.
51. Each of the Defendants personally profited from his fraudulent conduct. Sports
USA’s primary source of revenue was the bond proceeds obtained by Legacy Cares. Each of the
Defendants received substantial payments from the ill-gotten gains obtained through their false
and misleading statements and fraudulent scheme. For example, Chad Miller paid himself
through Sports USA more than approximately $30,000 per month after the fraudulent 2020
bond offering. Sports USA also paid De Laveaga a consulting fee of more than approximately
$20,000 after the 2020 bond offering. Additionally, almost immediately after the 2020 bond
offering, Randy Miller received approximately $230,000 from the bond proceeds that Legacy
Cares transferred to Sports USA.
VI.     Legacy Cares Defaulted on the Bonds and Filed Bankruptcy Proceedings.
52. The Sports Complex opened in January 2022 to a fraction of the demand
promised by Defendants. The Sports Complex reported first-year revenue of under $28 million
for 2022, well short of the $96 million in revenue falsely projected in the Offering Memoranda.
53. As a consequence, the bonds quickly failed. Legacy Cares was unable to make
interest and principal payments to bondholders, and, in October 2022, the bond trustee declared
the 2020 bonds and 2021 bonds to be in default. Attempts by Legacy Cares, Randy Miller, and
Chad Miller to refinance the bonds were unsuccessful.
54. As a result of the severe revenue shortfall, Legacy Cares filed Chapter 11
bankruptcy in May 2023 and was put in a liquidation trust. According to bankruptcy filings, the
Sports Complex was ultimately sold for less than $26 million to a new company which now
operates it. Due to the disappointing revenue, as well as a large number of construction and
contractor liens burdening the Sports Complex, the bond investors’ bankruptcy claim recouped
less than $2.5 million of the $284 million invested.
55.  Sports USA is now defunct, and all services for the Sports Complex previously
provided by Sports USA have been taken over by another entity.

15

FIRST CLAIM FOR RELIEF
Violations of Section 10(b) of the Exchange Act and Rule 10b-5 Thereunder
Against All Defendants
56. The Commission realleges and incorporates by reference paragraphs 1 through
55.
57.  By engaging in the conduct described above, Defendants Randy Miller, Chad
Miller, and De Laveaga, directly or indirectly, in connection with the purchase or sale of
securities, by use of means or instrumentalities of interstate commerce, or of the mails:
a. Employed devices, schemes, or artifices to defraud;
b. Made untrue statements of material facts or omitted to state material
facts necessary in order to make the statements made, in the light of the
circumstances under which they were made, not misleading; and
c. Engaged in acts, practices, or courses of business which operated or
would operate as a fraud or deceit upon other persons, including
purchasers of securities.
58. By reason of the foregoing, Defendants Randy Miller, Chad Miller, and De
Laveaga violated, and unless restrained and enjoined will continue to violate, Section 10(b) of
the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5].

SECOND CLAIM FOR RELIEF
Violations of Section 17(a) of the Securities Act
Against All Defendants
59. The Commission realleges and incorporates by reference paragraphs 1 through
55.
60. By engaging in the conduct described above, Defendants Randy Miller, Chad
Miller, and De Laveaga, directly or indirectly, in the offer or sale of securities, by use of the

16

means of instruments of transportation or communication in interstate commerce or by use of the
mails:
a. employed devices, schemes, or artifices to defraud;
b. obtained money or property by means of untrue statements of material
fact or by omitting to state a material fact necessary in order to make the
statements made, in light of the circumstances under which they were
made, not misleading; and
c. engaged in transactions, practices, or courses of business which operated
or would operate as a fraud or deceit upon purchasers.
61. By reason of the foregoing, Defendants Randy Miller, Chad Miller, and
De Laveaga violated, and unless restrained and enjoined will continue to violate, Section 17(a) of
the Securities Act [15 U.S.C. § 77q(a)].

PRAYER FOR RELIEF
WHEREFORE, the Commission respectfully requests that the Court enter a judgment:
I.
Permanently enjoining Defendants from directly or indirectly violating Section 10(b) of
the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 [17 C.F.R. § 240.10b-5] thereunder, and
Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)];
II.
Permanently restraining and enjoining Defendants from directly or indirectly, including,
but not limited to, through any entity owned or controlled by them, participating in the issuance,
purchase, offer, or sale of any security, provided, however, that such injunction shall not prevent
Defendants from purchasing or selling securities for their own personal accounts, pursuant to

Section 20(b) ofthe Securities Act [15 U.S.C. $ 77t(b)] and Sections 21(d)(l) and 21(d)(5) ofthe
Exchange Act [15 U.S.C. §§ 78u(d)(l) and 78u(d)(5)];
III.
Requiring Defendants to disgorge all ill-gotten gains received as a result of their unlawful
conduct plus prejudgment interest thereon, pursuant to Sections 21(d)(3), 21(d)(5), and 21(d)(7)
ofthe Exchange Act [15 U.S.C. §§ 78u(d)(3), 78u(d)(5), and 78u(d)(7)];
IV.
Requiring Defendants to pay civil monetary penalties pursuant to Section 20(d) ofthe
Securities Act [15 U.S.C. § 77t(d)] and Section 21(d)(3) ofthe Exchange Act [15 U.S.C. §
78u(d)(3)];
V.
Retaining jurisdiction ofthis action in accordance with the principles of equity and the
Federal Rules of Civil Procedure in order to implement and carry out the terms of all orders and
decrees that may be entered, or to entertain any suitable application or motion for additional
relief within the jurisdiction ofthis Court; and
VI.
Granting such other and further relief as this Court may determine to be just and
necessary.
JURY DEMAND
The Commission demands a trial by jury.
Dated: April 1, 2025
Respectfully submitted,
w.1£
Walinf7%.
Attorney for Plaintiff
SECURITIES AND EXCHANGE COMMISSION
17

1 

MONIQUE C. WINKLER  
JASON H. LEE 
DAVID ZHOU  
JASON BUSSEY 
WILLIAM SALZMANN 
JONATHAN GRANT 
Attorneys for Plaintiff 
SECURITIES AND EXCHANGE 
COMMISSION 
44 Montgomery Street, Suite 700 
San Francisco, CA 94104 
Telephone: (415) 705-2500 
Facsimile: (415) 705-2501 
Email: [email protected]; [email protected];  
             [email protected] 

UNITED STATES DISTRICT COURT 
SOUTHERN DISTRICT OF NEW YORK 

SECURITIES AND EXCHANGE 
COMMISSION, 

Plaintiff, 

 v. 

RANDALL J. MILLER, CHAD J. MILLER, 
and JEFFREY DE LAVEAGA  

Defendants. 

COMPLAINT  
1:25-cv-02702

JURY TRIAL DEMANDED 

Plaintiff Securities and Exchange Commission (the “Commission”), for its complaint 

against Defendants Randall J. Miller, Chad J. Miller, and Jeffrey De Laveaga, alleges as follows: 

SUMMARY 

1. This matter involves the fraudulent scheme to offer and sell approximately

$284 million in municipal bonds, now defaulted, issued for the benefit of Legacy Cares, Inc. 

(“Legacy Cares”), an Arizona nonprofit corporation in August 2020 and June 2021. Legacy 

Cares issued the bonds through the Arizona Industrial Development Authority, an Arizona state 

entity known as a “conduit issuer,” which issues municipal bonds for third-party borrowers, such 

Case 1:25-cv-02702     Document 1     Filed 04/01/25     Page 1 of 17



 

2 
 

as Legacy Cares. Randall (“Randy”) Miller founded and incorporated Legacy Cares for the 

purpose of issuing the bonds. 

2. The bond proceeds were used by Legacy Cares to finance the construction of a 

multi-sports park and family entertainment center (the “Sports Complex”) in Mesa, Arizona. The 

Sports Complex was operated by Legacy Sports USA, LLC (“Sports USA”), which was founded 

by Randy Miller.  

3.  To market the bonds to investors, the underwriter for both bond offerings (the 

“Underwriter”) distributed limited offering memoranda for the 2020 and 2021 bond offerings. 

Both the 2020 and 2021 offerings were for revenue bonds, which meant that the cash required to 

pay interest and principal back to the bondholders was to come from the revenue generated by 

the Sports Complex after it opened in 2022. The limited offering memorandum for the 2020 

bond offering (the “2020 Offering Memorandum”) included financial projections anticipating 

revenue that was multiple times the amount needed to cover the payments to investors in the 

2020 bonds. These financial projections were prepared at the direction of Randy Miller’s son, 

Chad Miller, with input from Jeffrey De Laveaga, an executive at Sports USA. 

4. The financial projections in the 2020 Offering Memorandum were false and 

misleading. The revenue anticipated in the financial projections was based on indications of 

interest in the Sports Complex, and was purportedly evidenced by dozens of “letters of intent” 

that were attached to the 2020 Offering Memorandum and therefore provided to investors. These 

letters purported to be from various sports clubs, leagues, and other entities expressing the intent 

to move their events or operations to the Sports Complex. The 2020 Offering Memorandum 

referenced the letters throughout the document as the basis for the revenue expectations, and 

included the letters as an attachment. 

5. However, the majority of the more than 50 letters of intent were either totally 

fabricated or materially altered in some fashion, including the forging of signatures, by Randy 

Miller, Chad Miller, and De Laveaga in the months leading up to the 2020 bond offering. Each 

Case 1:25-cv-02702     Document 1     Filed 04/01/25     Page 2 of 17



 

3 
 

Defendant knew or was reckless in not knowing that he was creating false documents, and that 

the documents would be disseminated to investors.  

6. In addition to the fabricated letters of intent, Defendants also, knowingly or 

recklessly, collaborated to create a set of 25 so-called “pre-contracts,” which, like the letters of 

intent, are referenced throughout the 2020 Offering Memorandum as supporting the revenue 

expectations. The 2020 Offering Memorandum represented that the pre-contracts constituted 

“binding” arrangements with Sports USA to use the Sports Complex and pay fees. The pre-

contracts were listed in the 2020 Offering Memorandum, and copies of the pre-contracts 

themselves were provided directly to potential investors prior to the sale of the 2020 bonds 

through an online investor “data room” hosted by the Underwriter (the “investor data room”). 

These pre-contracts were purportedly signed by some of the same sports leagues and entities 

falsely identified as having previously submitted letters of intent. Like the fabricated letters of 

intent, however, most of the pre-contracts were fake.  

7. The limited offering memorandum for the 2021 bond offering (the “2021 Offering 

Memorandum,” and, together with the 2020 Offering Memorandum, the “Offering Memoranda”) 

incorporated the same false projections, letters of intent, and pre-contracts from the 2020 

Offering Memorandum. 

8. The Sports Complex opened in January 2022 with far fewer events and much 

lower attendance than had been falsely projected in the Offering Memoranda. The Sports 

Complex generated less than $28 million in revenue for the year, in contrast to the $96 million 

year-one revenue projected in the Offering Memoranda.  

9. Due to this revenue shortfall, in October 2022, when it came time to begin 

repayment to the bondholders, Legacy Cares defaulted on both the 2020 and 2021 bonds. Legacy 

Cares subsequently filed bankruptcy proceedings in May 2023 and the Sports Complex is now 

owned by a new entity. According to bankruptcy filings, the investors’ bankruptcy claim 

recouped through the bankruptcy less than $2.5 million of the $284 million they had invested.  

Case 1:25-cv-02702     Document 1     Filed 04/01/25     Page 3 of 17



 

4 
 

10. As a result of the conduct described above, Randy Miller, Chad Miller, and De 

Laveaga each violated Section 10(b) of the Securities Exchange Act of 1934 (“Exchange Act”) 

[15 U.S.C. § 78j(b)] and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5], and Section 17(a) of the 

Securities Act of 1933 (“Securities Act”) [15 U.S.C. § 77q(a)]. 

 

NATURE OF THE PROCEEDINGS AND RELIEF SOUGHT 

11. The Commission brings this action pursuant to the authority conferred upon it by 

Sections 20(b), 20(d), and 22(a) of the Securities Act [15 U.S.C. §§ 77t(b), 77t(d), and 77v(a)], 

and Sections 21(d), 21(e), and 27 of the Exchange Act [15 U.S.C. §§ 78u(d), 78u(e), and 78aa].   

12. The Commission seeks a final judgment against Defendants Randy Miller, Chad 

Miller, and De Laveaga: (a) permanently enjoining Defendants from violating the federal 

securities laws and rules that this complaint alleges they have violated; (b) permanently 

enjoining Defendants from, directly or indirectly, including, but not limited to, through any 

entity owned or controlled by them, participating in the issuance, purchase, offer, or sale of any 

security, provided, however, that such injunction shall not prevent Defendants from purchasing 

or selling securities for their own personal accounts, pursuant to Section 20(b) of the Securities 

Act [15 U.S.C. § 77t(b)] and Sections 21(d)(1) and 21(d)(5) of the Exchange Act [15 U.S.C. §§ 

78u(d)(1) and 78u(d)(5)]; (c) ordering Defendants to pay disgorgement with prejudgment 

interest, pursuant to Sections 21(d)(3), 21(d)(5), and 21(d)(7) of the Exchange Act [15 U.S.C. §§ 

78u(d)(3), 78u(d)(5), and 78u(d)(7)]; (d) ordering Defendants to pay civil money penalties 

pursuant to Section 20(d) of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d)(3) of the 

Exchange Act [15 U.S.C. § 78u(d)(3)]; and (e) ordering any other and further relief the Court 

may deem just and proper. 

 

Case 1:25-cv-02702     Document 1     Filed 04/01/25     Page 4 of 17



 

5 
 

JURISDICTION AND VENUE 

13. This Court has jurisdiction over this action pursuant to Sections 20(b), 20(d), 

20(e), and 22(a) of the Securities Act [15 U.S.C. §§ 77t(b), 77t(d), 77t(e), and 77v(a)] and 

Sections 21(d), 21(e), and 27 of the Exchange Act [15 U.S.C. §§ 78u(d), 78u(e), and 78aa]. 

14. Defendants Randy Miller, Chad Miller, and De Laveaga, directly or indirectly, 

made use of the means and instruments of interstate commerce or of the mails in connection with 

the acts, transactions, practices, and courses of business alleged in this complaint.  

15. Venue is proper in this District pursuant to Section 22(a) of the Securities Act [15 

U.S.C. § 77v(a)] and Section 27(a) of the Exchange Act [15 U.S.C. § 78aa(a)]. Acts, 

transactions, practices, and courses of business that form the basis for the violations alleged in 

this complaint occurred in this District. For example, certain investors in both the 2020 and 2021 

bonds reside in this District and accessed offering documents in this District, and the clearing 

agency and securities depository that facilitated the transfer of both the 2020 and 2021 bonds is 

located in this District.  

 

DEFENDANTS 

16. Randall J. Miller, age 70, is a resident of Maricopa County, Arizona. At all 

relevant times, Randy Miller was the founder, Chairman, and Managing Member of Sports USA. 

He also founded and incorporated Legacy Cares.  

17. Chad J. Miller, age 40, is a resident of Maricopa County, Arizona. Chad Miller 

is the son of Randy Miller. At all relevant times, Chad Miller was the CEO of Sports USA.   

18. Jeffrey De Laveaga, age 55, is a resident of Maricopa County, Arizona. At all 

relevant times, De Laveaga was the Chief Operating Officer of Sports USA.  

 

RELATED ENTITIES 

19. Legacy Cares, Inc. is an Arizona nonprofit corporation and a 501(c)(3) 

organization formed by Randy Miller to develop, own, and operate sports and family 

Case 1:25-cv-02702     Document 1     Filed 04/01/25     Page 5 of 17



 

6 
 

entertainment facilities. Legacy Cares’ principal place of business is in Mesa, Arizona. Legacy 

Cares was the conduit borrower for the bonds at issue in this complaint. On May 1, 2023, Legacy 

Cares filed for Chapter 11 bankruptcy and is currently in a liquidation trust.   

20. Legacy Sports USA, LLC is an Arizona limited liability company and was the 

manager of the Sports Complex, and each of the Defendants was employed as an officer of 

Sports USA. Sports USA’s principal place of business is in Scottsdale, Arizona. Shortly before 

Legacy Cares’ bankruptcy filing, Sports USA ended its role as the Sports Complex’s manager 

and ceased all operations.  

21. Arizona Industrial Development Authority (the “Arizona Authority”) is a 

political subdivision of the state of Arizona and an Arizona nonprofit corporation. The Arizona 

Authority served as the conduit issuer for the 2020 and 2021 bonds. 

 

FACTS 

I. Background 

22. Prior to 2020, Randy Miller attempted for several years to develop other sports 

parks concepts by seeking private loans or investor funding. After proposing at least three 

different locations in the Phoenix area but failing to attract sufficient funds, he began to pursue 

the use of municipal bonds to finance the construction of the Sports Complex in Mesa, Arizona. 

23. In August 2020, the Arizona Authority acted as the conduit issuer for the sale of 

$250.8 million of economic development revenue bonds for the construction of the Sports 

Complex. The Arizona Authority acted solely as the conduit issuer with no responsibility for 

making interest and principal payments on the bonds. According to the 2020 Offering 

Memorandum, Legacy Cares was responsible for making payments to bondholders and would do 

so using revenue generated by the Sports Complex. 

24. The conduit borrower on the transaction was Legacy Cares. Randy Miller 

incorporated Legacy Cares as an Arizona non-profit entity so it could qualify as the conduit 

Case 1:25-cv-02702     Document 1     Filed 04/01/25     Page 6 of 17



 

7 
 

borrower for the municipal bond offerings and facilitate a portion of the bonds being issued on a 

tax-exempt basis as qualified 501(c)(3) bonds. 

25. Randy Miller set up Legacy Cares to operate as an independent shell for the sole 

purpose of issuing the bonds, and Legacy Cares retained Sports USA as a for-profit entity to 

serve as the Sports Complex’s manager. Accordingly, Legacy Cares contracted with Sports USA 

to oversee the construction of the Sports Complex and manage the facility’s subsequent 

operations. Sports USA, through the Defendants, also had the critical function of providing 

information about the Sports Complex for use in the Offering Memoranda, including the 

preparation of the financial projections and supporting documentation provided to investors. 

26. For its role, Sports USA was to receive a variety of payments from the Sports 

Complex, including 5% of all capital expenditures upfront as a “development fee,” 7% of all 

revenue as a “basic fee,” 5% of all gross profits as an “incentive fee,” and then additional 

guaranteed monthly “accounting fee[s]” and expense reimbursements. 

27. In June 2021, Randy Miller and Chad Miller sought additional funding for the 

Sports Complex through municipal bonds, and the Arizona Authority ultimately issued an 

additional $33 million of revenue bonds, also for the construction of the Sports Complex. Once 

again, according to the 2021 Offering Memorandum, Legacy Cares bore the sole responsibility 

for making payments to bondholders and would do so using the Sports Complex’s revenue.  

28. As, respectively, Chairman and Chief Executive Officer of Sports USA, both 

Randy Miller and Chad Miller had controlling authority over Sports USA at all relevant times. 

De Laveaga served as Sports USA’s Chief Operating Officer and was paid a consulting fee by 

Sports USA during the relevant period.   

29. The Sports Complex was designed to be one of the largest of its kind in the 

United States, consisting of over 300 acres of indoor and outdoor sports fields, courts, locker 

rooms, a 10,000-person capacity stadium, office spaces, restaurants, and other entertainment 

options. The size and cost of the Sports Complex meant that, to be successful, it would need to 

Case 1:25-cv-02702     Document 1     Filed 04/01/25     Page 7 of 17



 

8 
 

be fully utilized for events and activities spanning many different types of sports, such as 

baseball, football, soccer, volleyball, pickleball, basketball, e-sports, and CrossFit.  

II. Defendants Knowingly or Recklessly Made Materially False and Misleading 

Statements to Investors in the 2020 Bond Sale. 

30. In the 2020 Offering Memorandum, and in other communications with investors, 

Defendants presented investors with false and misleading projected revenue and other 

information designed to provide assurances that the Sports Complex would generate the revenue 

necessary to make timely bond payments. Specifically, Defendants projected that the Sports 

Complex would generate over $96 million in revenue in its first year of operation. Defendants 

supported this high revenue number with representations that the venue would be nearly fully 

booked consistently starting from the opening day. 

31. Throughout the 2020 Offering Memorandum, Defendants claimed to support the 

revenue projections with two independent feasibility studies, as well as detailed spreadsheets that 

broke down projected revenue by type of sport. The underlying support for the revenue 

projections supposedly came from more than 50 letters of intent, purportedly from various sports 

organizations and leagues that had pledged to move events or operations to the Sports Complex. 

32. In reality, Sports USA had not generated anywhere near enough interest from 

sports organizations to support the revenue projections. Rather, Defendants, knowingly or 

recklessly, fabricated or materially altered the majority of the letters of intent to make it appear 

that the Sports Complex would be fully committed in its first year of operation. These false 

documents, in turn, served as the bases for the other false and misleading representations to 

investors, including the 2020 Offering Memorandum’s revenue projections, information in a 

“peer review” study conducted by an outside consultant that was included in the 2020 Offering 

Memorandum, and further false so-called “pre-contracts” that purported to be binding 

agreements with sports entities for the use of the Sports Complex and the payment of fees. 

Case 1:25-cv-02702     Document 1     Filed 04/01/25     Page 8 of 17



 

9 
 

A.  Fabricated and Altered Letters of Intent  

33. The letters of intent prepared by Defendants were purportedly from a wide array 

of local, national, and international sporting organizations, including several world-renowned 

national and international sports institutions. Many of the purported letters expressed an intent to 

move certain games, leagues, or tournaments to the Sports Complex, while others stated that 

their organizations would be moving their entire operations there. Certain of the letters included 

specific attendance and revenue projections for events to take place at the Sports Complex. 

34. In the year leading up to the offering of the 2020 bonds, Defendants knowingly or 

at least recklessly fabricated or materially altered the majority of the letters of intent. Some of the 

letters were entirely fake, with the phony documents including, among other things, incorrect 

letterhead from outdated sources, forged signatures, and incorrect or misspelled signatories. The 

creation and gathering of the fraudulent letters of intent was a collaborative effort by Defendants, 

who communicated with each other instructions and shared drafts of fake documents. All three 

Defendants personally fabricated false documents. In some instances, Randy Miller directed 

Chad Miller to change the dates on some of the older letters of intent. In others, Chad Miller 

instructed or coordinated the creation of false letters of intent by De Laveaga and others working 

at their direction for Sports USA. 

35. For example, one fabricated letter, which falsely described the entity as having 

committed to move an annual event to the Sport Complex, included a phony letterhead, 

misidentified the name of the sports organization that purportedly issued the letter, and 

misspelled the last name of the purported signatory. Another fake letter, which falsely stated that 

the organization had committed to use the Sports Complex for its events, misidentified the name 

of the sports organization that purportedly issued the letter, and misspelled the name of the 

purported signatory of the letter. 

36. Chad Miller then knowingly, or recklessly, provided the false letters of intent to 

the Underwriter for inclusion as an attachment to the 2020 Offering Memorandum. Chad Miller 

also provided the false letters of intent to be included in the Underwriter’s investor data room. 

Case 1:25-cv-02702     Document 1     Filed 04/01/25     Page 9 of 17



 

10 
 

This investor data room was used by both potential bond investors and other bond participants to 

evaluate the bonds in the weeks prior to the 2020 bond offering. 

B.  Fabricated Pre-Contracts 

37. Chad Miller, and others working at his direction, also fabricated so-called “pre-

contracts” representing commitments from sports providers and caused these false documents to 

be provided to investors in connection with the offering of the 2020 bonds. Randy Miller 

reviewed the pre-contracts before they were provided to investors. 

38. Chad Miller knowingly or recklessly fabricated, and directed the fabrication of, 

the pre-contracts because the dates on some of the letters of intent were stale and the Underwriter 

for the bonds had requested that Sports USA obtain additional communications from the 

purported letter writers that were more current and that reflected a further level of commitment 

from those entities. In response to this request, Chad Miller, with others at Sports USA working 

at his direction, fabricated pre-contracts with false signatures from some of the entities that had 

purportedly signed the letters of intent. The pre-contracts falsely stated that they constituted 

“binding agreement[s]” between Sports USA and the entities to enter into “formal use 

agreement[s]” to hold events at the Sports Complex within 90 days of groundbreaking. Randy 

Miller and Chad Miller knew, or were reckless in not knowing, that the “agreement[s]” 

represented by the fake pre-contracts were fictitious, and that these documents were created for 

the purpose of deceiving bond investors. Chad Miller provided the pre-contracts to the 

Underwriter, and these fake documents were also included in the investor data room in the weeks 

prior to the offering of the 2020 bonds. 

C. False and Misleading Projected Revenue 

39. The 2020 Offering Memorandum is replete with references to the fabricated 

letters of intent and pre-contracts to assure investors of potential revenue and the viability of the 

Sports Complex. 

40. Notably, the 2020 Offering Memorandum included projected financial 

information, including a “Summary Five-Year Pro Forma” financial statement detailing the 

Case 1:25-cv-02702     Document 1     Filed 04/01/25     Page 10 of 17



 

11 
 

expected revenue and expenses for the first five years of the Sports Complex’s operation, starting 

in 2022. According to this pro forma financial statement, the Sports Complex was expected to 

generate over $96 million in revenue in 2022, which was multiple times the amount owed in 

payments to bondholders that year. The pro forma financial statement was prepared at the 

direction of Chad Miller in the weeks prior to the offering of the 2020 bonds. Chad Miller and 

De Laveaga then reviewed and approved the pro forma statement before providing it to the 

Underwriter for inclusion in the 2020 Offering Memorandum.  

41. As Defendants knew, or were reckless in not knowing, the projected revenue in 

the pro forma financial statement was false and misleading because it was based on the false 

letters of intent and pre-contracts.  

D.  False and Misleading “Peer Review & Impact Analysis” Relying on the 

Fabricated Letters of Intent 

42. Chad Miller also knowingly or recklessly provided the false financial projections 

and fake letters of intent to an unknowing outside consultant (the “Peer Review Consultant”), 

which used that information to put together a report that was generally supportive of Sports 

USA’s misleading revenue projections. That report was attached to the 2020 Offering 

Memorandum.  

43. In or around 2016, Randy Miller and Sports USA engaged an outside consultant 

(the “Feasibility Consultant”) to conduct a feasibility study of one of Sports USA’s earlier 

sports-park proposals, which would have been located in Phoenix rather than Mesa. The 

Feasibility Consultant estimated that the potential first-year annual revenue for that project 

ranged from $29 million up to, with caveats, $38 million.  

44. At the Underwriter’s suggestion, Chad Miller engaged a peer-review consultant to 

conduct a “Peer Review & Impact Analysis” (the “peer review”) which examined the 

methodology of the earlier feasibility study, but updated it by applying the more recent revenue 

projections specifically relating to the Sports Complex’s Mesa location. As explained in detail 

above, those projections, which were directed and approved by Chad Miller and De Laveaga, 

Case 1:25-cv-02702     Document 1     Filed 04/01/25     Page 11 of 17



 

12 
 

were based on the false letters of intent, which were themselves also provided to the Peer Review 

Consultant through the investor data room. On its face, the peer review made clear that its 

calculations were dependent on the Peer Review Consultant’s assumption that “all” of the letters 

of intent were accurate.  

45. The 2020 Offering Memorandum attached the peer review as an appendix. In it, 

the Peer Review Consultant concluded that the Sports Complex would generate approximately 

$84 million in first-year revenue. Although this amount was lower than the corresponding figure 

in Sports USA’s pro forma financial statement, which estimated $96 million of first-year 

revenue, it was still multiple times more than the amount necessary to meet Legacy Cares’ bond 

payment obligations to investors. As Defendants knew, or were reckless in not knowing, the peer 

review presented to investors in the 2020 Offering Memorandum was based on materially false 

and misleading revenue projections and false letters of intent. 

E.  False Statements Made on Bond Investor Webinar 

46. In July 2020, a few weeks before the offering of the 2020 bonds, Chad Miller and 

De Laveaga participated in a webinar hosted by the Underwriter and attended by potential 

investors. In this webinar, Chad Miller falsely stated that the entire Sports Complex was pre-sold 

to be “over 90% occupancy” by day one of opening. He further misleadingly stated that the 

projected revenue and occupancy rate were supported by the letters of intent—the same 

documents that he had helped to fabricate and alter. Similarly, De Laveaga misleadingly told 

investors in the webinar that the Sports Complex would be sold out before it even opened its 

doors. 

47. Both Chad Miller and De Laveaga knew, or were reckless in not knowing, that 

their statements were false and misleading, and that the statements were based on the false 

revenue projections and false documents that Defendants had created. 

Case 1:25-cv-02702     Document 1     Filed 04/01/25     Page 12 of 17



 

13 
 

III.   The 2021 Offering Memorandum Incorporated the Same False Statements from the 

2020 Offering Memorandum.  

48. The second offering occurred in June 2021 when the Arizona Authority issued 

$33 million of additional bonds, also to be used to construct the Sports Complex. The 2021 

Offering Memorandum incorporated the entire 2020 Offering Memorandum, including the false 

and misleading revenue projections, misleading peer review, the fabricated letters of intent, and 

descriptions of the fabricated pre-contracts. Accordingly, the false and misleading statements 

described above regarding the 2020 bonds apply equally to the 2021 bonds. 

IV. Defendants Acted Knowingly or Recklessly to Deceive Bond Investors. 

49. The scheme to offer and sell the bonds through the use of false and misleading 

financial projections, the false letters of intent and pre-contracts, and the misleading peer review, 

was conducted knowingly or recklessly by Defendants. Notably, Defendants acted with scienter 

in fabricating and altering numerous letters of intent and pre-contracts, which they knew, or were 

reckless in not knowing, would be provided to potential investors. Defendants further knew, or 

were reckless in not knowing, that the financial projections that they created for the offerings 

were false and misleading because they were based on false letters of intent and false pre-

contracts.  Defendants also knew, or were reckless in not knowing, that the peer review was 

based on the fake letters of intent. In addition, Chad Miller and De Laveaga knew, or were 

reckless in not knowing, that the statements they made during the investor webinar were based 

on false projections and false documents. 

50. Defendants’ misrepresentations were material to a reasonable investor, as well as 

actual investors, in the 2020 bonds and 2021 bonds. The revenue projections and peer review in 

the Offering Memoranda were important to investors when deciding whether to purchase the 

bonds because the bonds were revenue bonds and, as a consequence, interest and principal 

payments would be made from the Sports Complex’s revenue. The letters of intent and pre-

contracts, which were the underlying basis for the revenue projections and peer review, were also 

important to investors. 

Case 1:25-cv-02702     Document 1     Filed 04/01/25     Page 13 of 17



 

14 
 

V.   The Proposed Defendants Personally Profited from the Fraud. 

51. Each of the Defendants personally profited from his fraudulent conduct. Sports 

USA’s primary source of revenue was the bond proceeds obtained by Legacy Cares. Each of the 

Defendants received substantial payments from the ill-gotten gains obtained through their false 

and misleading statements and fraudulent scheme. For example, Chad Miller paid himself 

through Sports USA more than approximately $30,000 per month after the fraudulent 2020 

bond offering. Sports USA also paid De Laveaga a consulting fee of more than approximately 

$20,000 after the 2020 bond offering. Additionally, almost immediately after the 2020 bond 

offering, Randy Miller received approximately $230,000 from the bond proceeds that Legacy 

Cares transferred to Sports USA. 

VI.     Legacy Cares Defaulted on the Bonds and Filed Bankruptcy Proceedings. 

52. The Sports Complex opened in January 2022 to a fraction of the demand 

promised by Defendants. The Sports Complex reported first-year revenue of under $28 million 

for 2022, well short of the $96 million in revenue falsely projected in the Offering Memoranda.  

53. As a consequence, the bonds quickly failed. Legacy Cares was unable to make 

interest and principal payments to bondholders, and, in October 2022, the bond trustee declared 

the 2020 bonds and 2021 bonds to be in default. Attempts by Legacy Cares, Randy Miller, and 

Chad Miller to refinance the bonds were unsuccessful. 

54. As a result of the severe revenue shortfall, Legacy Cares filed Chapter 11 

bankruptcy in May 2023 and was put in a liquidation trust. According to bankruptcy filings, the 

Sports Complex was ultimately sold for less than $26 million to a new company which now 

operates it. Due to the disappointing revenue, as well as a large number of construction and 

contractor liens burdening the Sports Complex, the bond investors’ bankruptcy claim recouped 

less than $2.5 million of the $284 million invested. 

55.  Sports USA is now defunct, and all services for the Sports Complex previously 

provided by Sports USA have been taken over by another entity. 

Case 1:25-cv-02702     Document 1     Filed 04/01/25     Page 14 of 17



 

15 
 

FIRST CLAIM FOR RELIEF 

Violations of Section 10(b) of the Exchange Act and Rule 10b-5 Thereunder 

Against All Defendants 

56. The Commission realleges and incorporates by reference paragraphs 1 through 

55. 

57.  By engaging in the conduct described above, Defendants Randy Miller, Chad 

Miller, and De Laveaga, directly or indirectly, in connection with the purchase or sale of 

securities, by use of means or instrumentalities of interstate commerce, or of the mails: 

a. Employed devices, schemes, or artifices to defraud; 

b. Made untrue statements of material facts or omitted to state material 

facts necessary in order to make the statements made, in the light of the 

circumstances under which they were made, not misleading; and 

c. Engaged in acts, practices, or courses of business which operated or 

would operate as a fraud or deceit upon other persons, including 

purchasers of securities. 

58. By reason of the foregoing, Defendants Randy Miller, Chad Miller, and De 

Laveaga violated, and unless restrained and enjoined will continue to violate, Section 10(b) of 

the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5]. 

 

SECOND CLAIM FOR RELIEF 

Violations of Section 17(a) of the Securities Act 

Against All Defendants 

59. The Commission realleges and incorporates by reference paragraphs 1 through 

55. 

60. By engaging in the conduct described above, Defendants Randy Miller, Chad 

Miller, and De Laveaga, directly or indirectly, in the offer or sale of securities, by use of the 

Case 1:25-cv-02702     Document 1     Filed 04/01/25     Page 15 of 17



 

16 
 

means of instruments of transportation or communication in interstate commerce or by use of the 

mails: 

a. employed devices, schemes, or artifices to defraud; 

b. obtained money or property by means of untrue statements of material 

fact or by omitting to state a material fact necessary in order to make the 

statements made, in light of the circumstances under which they were 

made, not misleading; and 

c. engaged in transactions, practices, or courses of business which operated 

or would operate as a fraud or deceit upon purchasers. 

61. By reason of the foregoing, Defendants Randy Miller, Chad Miller, and 

De Laveaga violated, and unless restrained and enjoined will continue to violate, Section 17(a) of 

the Securities Act [15 U.S.C. § 77q(a)]. 

 

PRAYER FOR RELIEF 

WHEREFORE, the Commission respectfully requests that the Court enter a judgment:   

I. 

Permanently enjoining Defendants from directly or indirectly violating Section 10(b) of 

the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 [17 C.F.R. § 240.10b-5] thereunder, and 

Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)]; 

II. 

Permanently restraining and enjoining Defendants from directly or indirectly, including, 

but not limited to, through any entity owned or controlled by them, participating in the issuance, 

purchase, offer, or sale of any security, provided, however, that such injunction shall not prevent 

Defendants from purchasing or selling securities for their own personal accounts, pursuant to  

 

 

Case 1:25-cv-02702     Document 1     Filed 04/01/25     Page 16 of 17



Section 20(b) of the Securities Act [15 U.S.C. $ 77t(b)] and Sections 21(d)(l) and 21(d)(5) of the

Exchange Act [15 U.S.C. §§ 78u(d)(l) and 78u(d)(5)];

III.

Requiring Defendants to disgorge all ill-gotten gains received as a result of their unlawful

conduct plus prejudgment interest thereon, pursuant to Sections 21(d)(3), 21(d)(5), and 21(d)(7)

of the Exchange Act [15 U.S.C. §§ 78u(d)(3), 78u(d)(5), and 78u(d)(7)];

IV.

Requiring Defendants to pay civil monetary penalties pursuant to Section 20(d) of the

Securities Act [15 U.S.C. § 77t(d)] and Section 21(d)(3) of the Exchange Act [15 U.S.C. §

78u(d)(3)];

V.

Retaining jurisdiction of this action in accordance with the principles of equity and the

Federal Rules of Civil Procedure in order to implement and carry out the terms of all orders and

decrees that may be entered, or to entertain any suitable application or motion for additional

relief within the jurisdiction of this Court; and

VI.

Granting such other and further relief as this Court may determine to be just and

necessary.

JURY DEMAND

The Commission demands a trial by jury.

Dated: April 1, 2025

Respectfully submitted,

w.1£Walinf7%.
Attorney for Plaintiff
SECURITIES AND EXCHANGE COMMISSION

17

Case 1:25-cv-02702     Document 1     Filed 04/01/25     Page 17 of 17