Wendy Maitland accuses Sitt of “starving” Town of financial resources

From the New York site: Wendy Maitland, who The Real Deal reported earlier today is leaving Town Residential, is suing the brokerage, accusing co-owner Joseph Sitt of starving the company of funds.

In a lawsuit filed Wednesday in New York State Supreme Court, Maitland claims Sitt’s withholding of funds cost the company agents, a new development exclusive, and watered down the price the company would fetch if it were sold.

A spokesperson for Thor Equities, Sitt’s investment firm, declined to comment. Maitland couldn’t be reached for comment.

In the suit, she claims that Sitt, who controls the company’s finances and serves as co-chairman, began “starving” Town of money and refused to reimburse her expenses, fund marketing campaigns and even fired her driver, replacing him with another driver who later got into a collision.

Sitt also allegedly stopped paying rent on all of Town’s sales offices and didn’t pay suppliers, ruining Town’s relationship with some landlords and vendors, Maitland claims in the suit. In April, a unit of Virginia-based Belvedere Management Co., the company’s landlord at its 120 East 16th Street office, filed suit, claiming that Town didn’t pay three months worth of rent in 2016. That suit was later settled.

“Dozens of sales agents” have departed the company since January and one developer has pulled a new development project, she alleges.

“Other developers have refused to hire Town because of Town’s financial reputational issues,” she added.

Maitland said Sitt’s moves have hurt the value of the company, meaning that any potential sale or merger would reap lower financial rewards than it would have last year. She described the company as “rudderless” and said Sitt excluded her from marketing, strategy and budget meetings.

Her resignation was submitted May 21, according to the suit.

As part of her employment agreement, Maitland was paid an annual salary plus a 2 percent share of Town’s quarterly profits, the suit states. She was also to be paid two lump sums of $150,000 each once the Charles, one of Town’s major new development exclusives, hit the 50 percent and 90 percent sold marks, respectively. And, if the company were ever sold, she was due to get a 2 percent share of its “net realized gain,” even in the event of her termination.

She is seeking at least $15 million in the event of a sale or merger plus $300,000 for sales at the Charles.