Zygi Wilf loses suit claiming he used "organized crime-type activities" to scam partners
Zygi isn't above playing dirty to line his pockets, a New Jersey judge's ruling suggests.
Bitter over how much public funding the new Vikings stadium is receiving? Would it make you feel any better to know that a New Jersey judge thinks billionaire team owner Zygi Wilf demonstrated "bad faith and evil motive" in bilking his business partners out of $51 million he owed them?
Probably not. But that's how Judge Deanne Wilson characterized his behavior (and the behavior of his family members) while summarizing her ruling in a civil suit spanning 21 years and four judges' worth of litigation.
An NJ.com report provides the details:
The Wilfs' business partners claimed family members systematically cheated them out of their fair share of revenues from Rachel Gardens, a 764-unit apartment complex in Montville, by running what amounted to "organized-crime-type activities" in their bookkeeping practices that gave the Wilfs a disproportionate share of the income.
Wilson found that Zygmunt Wilf, along with his brother, Mark, and their cousin, Leonard, committed fraud, breach of contract and breach of fiduciary duty and also violated the state's civil racketeering statute, or RICO...
Wilson did not announce the specific amount of damages to be awarded. During court sessions over the next two weeks, Wilson is expected to detail her ruling and will announce the damages at the conclusion. She invited accountants for both sides to submit their calculations.
The plaintiffs, in their closing arguments, sought a total of $51 million, including $33 million for Reichmann and $18 million for Halpern, their attorneys said. Court decisions have determined that each owns 25 percent of Rachel Gardens, and the Wilfs own 50 percent.
The report quotes the Wilfs' lead attorney, Shep Guryan, as saying, "The Wilf family has been in business for 58 years and has earned a well-deserved reputation for integrity and honest dealings. As with many businesses, disputes occasionally arise, and since we are currently in the midst of a legal process to resolve this civil lawsuit, we must decline further comment."
But Judge Wilson said the Wilfs failed to meet the "barest minimum" of their responsibilities as business partners and added, "I do not believe I have seen one single financial statement that is true and accurate." She said the Wilfs used "grossly disproportionate management fees" and "unreasonable" interest rates (among other tactics) to deprive their partners of income that was rightfully theirs.
In case you've forgotten, Minnesota taxpayers are on the hook for $348 million of the $975 million project cost of the new Vikings stadium, with Minneapolis set to kick in $150 million more. So some would argue the Rachel Gardens situation isn't the only time the Wilfs have committed fraud.
-- Follow Aaron Rupar on Twitter at @atrupar. Got a tip? Drop him a line at email@example.com.
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