MOBILE, Ala. — A co-founder of a Mobile medical device start-up accused of spending millions of dollars in investor money on a lavish lifestyle wants to be tried separately from his ex-wife and former business partner, arguing the two will present “conflicting defenses.”
Peter “Teddy” Falkner’s objection came within an hour of a Sept. 24 motion by Alabama Securities Commission prosecutors asking to combine his criminal case with that of Carla Williams. A hearing on the dispute was set for Tuesday, Sept. 29.
The case at a glance
- Defendants: Peter “Teddy” Falkner and Carla Williams, former spouses and business partners
- Company: Innovative Medicine Partners (IMP), a Mobile medical device start-up
- Prosecuting agency: Alabama Securities Commission
- Allegation: More than $5 million in investment money spent on personal expenses
- Money raised: More than $10 million from more than 80 investors in 14 states between 2017 and 2022
- Pleas: Both pleaded not guilty; Falkner also pleaded not guilty by reason of mental disease or defect
- Next step: Hearing on the motion to consolidate, Sept. 29
Prosecutors want one trial
In their Sept. 24 motion, prosecutors argued the two cases should be joined because Falkner and Williams are both charged as part of the same alleged conspiracy and participated in the same underlying transactions. The motion said the same evidence would be presented against each defendant and the same witnesses would be called at trial.
Prosecutors allege the now-divorced couple spent more than $5 million of their small business’s investment money on their “lavish lifestyles.” According to the state, that spending included children’s tuition, utilities, meals, international travel, concert tickets, more than $60,000 in Amazon purchases and expenses related to Williams’ country music career.
Falkner: A joint trial could cause a mistrial
Falkner’s attorney, Buzz Jordan, filed an objection within an hour of the prosecution’s request. He argued the former spouses will present “conflicting defenses,” though the filing does not explain what that conflict is.
Jordan’s motion also suggests Falkner is prepared to testify in his own defense.
“Defendant Falkner’s potential testimony at a trial will prejudice his co-defendant and would result in a mistrial,” Jordan wrote in the objection.
Why joint trials are contested
Courts often allow defendants charged in the same scheme to be tried together, since it saves time and spares witnesses from testifying more than once. Prosecutors also generally prefer a single trial so jurors can see the full picture of an alleged conspiracy.
Defense attorneys, however, sometimes seek separate trials when co-defendants plan to blame each other, a situation often described as “antagonistic” or “conflicting” defenses. If one defendant’s testimony or evidence could unfairly harm the other, a judge may decide separate trials are needed to protect each defendant’s right to a fair trial. Judges weigh those concerns against the efficiency of a single trial when deciding whether to “sever” cases.
An insanity plea tied to a car crash
Earlier this month, both Falkner and Williams pleaded not guilty to the charges related to Innovative Medicine Partners, which solicited more than $10 million from more than 80 investors across 14 states between 2017 and 2022.
Williams entered a traditional not-guilty plea. Falkner additionally pleaded not guilty by reason of mental disease or defect. Jordan has said Falkner’s debilitating condition stems from injuries he suffered in a May 2024 automobile accident in Tennessee.
In a separate personal injury lawsuit filed in Nashville, Falkner claims he was rear-ended while driving on Old Hickory Boulevard and suffered “severe and permanent injuries and permanent disability,” as well as mental anguish, loss of enjoyment of life and diminished earning capacity. He is seeking $750,000 in compensatory damages from the other driver and the vehicle’s owner. That lawsuit does not identify a specific mental or cognitive diagnosis tied to the crash.
What the Securities Commission does
The Alabama Securities Commission is the state agency that regulates the sale of securities, such as stocks and investment interests, in Alabama, and it investigates and prosecutes securities fraud. Start-up companies that raise money from investors must follow state and federal securities laws, including rules on disclosures to investors about how their money will be used.
The commission encourages investors to research companies and the people selling investments before handing over money, and to contact the agency with questions or complaints.
What happens next
A judge will hear arguments Tuesday on whether Falkner and Williams should face a joint trial. Both defendants are presumed innocent unless and until proven guilty in court. This article will be updated after the hearing.