A former instructor testified Tuesday that Dance Place employees sold expensive packages of lessons and trips to elderly clients by using manipulative and high-pressure sales tactics that preyed on the emotions of patrons.
In the opening day of what could be a two-week racketeering trial against Dance Place owner Michael A. Pasquarelli, Jeremy Ehlers told of trips sold at huge profits, of complicated contracts, of dance instructors who had no dance training and of expensive packages sold to an elderly woman with questionable mental capacity.
It was, say authorities, a scheme that fleeced patrons of tens of thousands, if not hundreds of thousands, of dollars.
During the trial's first day, Ehlers said he remembered the days when his students applied to the studio's "bronze" club.
Pasquarelli's studios in Oldsmar, Safety Harbor and Tampa would use a technique called "Past is black, future is rosy," he said. Instructors were told to find out painful past experiences about students that could be used to exert emotional pressure on the customers.
On the days students applied to join the "bronze" club, they were told to dress in their best clothes, Ehlers said. The instructor would buy them flowers and give them a card, then hold their hand as they were brought into a room with the closer. The student would perform a few steps in front of the closer.
Regardless of ability, he said, no one was ever turned down.
Ehlers recalled his first student up for the bronze package, a Canadian woman whose husband had died several months before. The package could cost as much as $30,000, he said, and the woman said she could not afford it.
He said that's when Pasquarelli zeroed in.
"I know you're awfully lonely right now," he told her.
The woman began to cry, he said, and he left the room.
"She eventually bought," Ehlers said.
He also spoke of "stacking" hours, essentially selling students new packages when they already had purchased way more than they could ever use in a year.
Ehlers, now a waiter in New Orleans, said he was repeatedly told not to "overteach." Lesson plans were designed to be so simple that they would bore students and entice them to buy more expensive packages. The steps taught in initial 10-hour packages could easily be mastered by most students in three to five hours, he said.
"This really was a system for extracting large amounts of money from people over a short period of time using high-pressure sales tactics that exploited any weakness in the (student)," prosecutor Evan Brodsky said.
In a written statement that he handed a reporter, Pasquarelli, 50, ridiculed the state's case.
"You can bet when the state presents their case they will do what Florida is so famous for; they will bring a circus to town," Pasquarelli wrote. "You will see the ultimate in Barnum and Bailey law practices. It has even been rumored that the prosecutors may reduce the charges from Racketeering to Mouseketeering!"
State officials closed Dance Place in June 2002, claiming it used coercive, high-pressure sales tactics to sell costly dance lessons and vacation packages to mostly elderly clients.
The studio, at 550 Main St. in Safety Harbor, was the first dance studio in years to be shut down by the state.
The state's investigation was triggered by a St. Petersburg Times story about a 75-year-old Palm Harbor widow who says she was pressured into spending $257,000 at the studio during three weeks in December 2001.
After the story ran, 16 Dance Place customers complained to the state, officials said.
Pasquarelli, who lives in Palm Harbor, and his associate, David B. "Vic" Andrews, were charged with violating the Racketeer-Influenced and Corrupt Organizations Act, also known as RICO.
During a multiagency investigation leading up to the arrests, investigators reviewed the files of 30 students at three of Pasquarelli's studios. Those 30 customers had been talked into signing 328 different sales contracts totalling $3.5-million, according to investigators.
Court records listed at least five students who spent $100,000 on dance lessons and five who spent $20,000 or more.
Along with using coercive sales tactics, Pasquarelli and Andrews also are charged with illegally selling vacation packages and engaging "in a scheme constituting a systematic, ongoing course of conduct with intent to defraud" their clients, according to court records.
On the eve of his own trial last May, Andrews, 76, pleaded guilty in exchange for a sentence that would not exceed 10 years.
In accepting the plea, Circuit Judge Philip A. Federico told Andrews that the length of his sentence - between 64 months and 10 years - would depend in part on his cooperation with prosecutors in the Pasquarelli case.
Whatever the sentence, it will not be Andrews' first trip to prison on such charges.
In 1995, he was convicted of preying on elderly dance club patrons at Aragon World Dance Studio in Port Richey.
Investigators then said Andrews, who now lives in St. Petersburg, and the studio's owner used similar pressure tactics and intimidation to sell expensive packages of dance lessons and trips, mostly to elderly women. His and other cases like it prompted the Legislature to write a new law in 1992 to regulate dance studios.
Andrews was released from prison in 1998, but his 20-year probation did not ban him from the dance studio business. So he went back to work for Pasquarelli at Dance Place. There, his duties included managing telemarketers and going over contracts with clients.