Despite a year passing since broker Timothy King filed a $3 million lawsuit accusing his former partners Paul Massey and Robert Knakal of Massey Knakal Realty Services of improper activities and mismanagement of the firm, the two sides remain at loggerheads after a hearing in Brooklyn court today.
A judge in State Supreme Court rejected motions introduced by both sides and left open the possibility that she would move the dispute to arbitration.
King filed suit June 2008 on behalf of Massey Knakal Realty of Brooklyn, a partnership in which he holds a 10 percent interest. Massey, CEO of Massey Knakal Realty Services, and Knakal, that company’s chairman, are 50-50 partners in Massey Knakal Realty Holdings, which owns 70 percent of the Brooklyn entity. King is not suing the other five individuals who have a 20 percent stake in the Brooklyn office.
King, who rose to the level of COO at Massey Knakal citywide, filed suit to protect the interests of the Brooklyn company, an amended complaint filed in July last year said.
In that filing King alleged a number of improprieties: for example, that the entity Massey Knakal Realty Services was not licensed as a broker in New York State and had improperly moved money from one of the firm’s entities to another in the form of loans and transfers.
King, who was in the courtroom today, left Massey Knakal Realty Services in March and with other Massey Knakal veterans founded a Brooklyn-based commercial sales and leasing firm, Cpex Real Estate. Massey and Knakal did not attend the proceeding.
King declined to comment. Massey said, “It is always difficult dissolving a partnership and we wish Tim the best with his leasing business in Brooklyn.”
King’s attorney Alan Trachtman, with the firm Nourse & Bowles, filed a motion, heard today, that would have prevented the Brooklyn arm of the firm from transferring money from that entity to another, but Judge Carolyn Demarest turned him down, in part noting that there did not appear to be any investigations of the allegedly illegal activity. By that decision, she also lifted a temporary restraining order against the firm.
Trachtman also wanted the court to find Massey Knakal in contempt for not turning over all the documents the court had ordered to be produced last year, but that was rejected as well.
Massey Knakal’s attorney, Steven Hurd, a partner at law firm Proskauer Rose, fared no better. He filed a motion to dismiss the case, and that was rejected. However, a motion to send the case to arbitration remains pending, with no date for a decision.
Demarest expressed frustration that the case was dragging on.
“I hope we are close to a resolution,” she said, before upbraiding both lawyers several times during the proceedings.