Two hours after filing a lawsuit claiming he was cheated out of a lucrative deal with Compass, Hamptons broker Jonathan Davis suddenly withdrew the legal complaint.
Davis filed a lawsuit around midday on Tuesday, accusing the Manhattan-based firm of breach of contract. He alleged Compass had backpedaled on financial terms of his employment and then fired him when he objected. In a bizarre twist, Davis filed a motion to withdraw the suit around 3:30 p.m., according to court documents. The complaint, which was filed in Suffolk County, had sought $3 million in damages.
For its part, Compass said it terminated Davis, whom it recruited in January, when Davis made “unreasonable monetary demands” relating to his affiliation with the firm.
“The fact that an agent with less than 3 years of experience and only 6 weeks with Compass, is trying to extract $3 million from the company, speaks for itself,” a Compass spokesperson told The Real Deal before the complaint was withdrawn. “Particularly troubling, is that Jonathan’s demands are different than the original terms that were agreed to.”
Davis jumped to Compass earlier this year from the Corcoran Group, where he worked with his father, star broker Tim Davis, the No. 1 broker on TRD’s ranking of top Hamptons agents in July 2015, at which time Tim had roughly $615 million in listings.
The relationship between Jonathan Davis and Compass quickly soured, according to court documents.
According to Davis’ complaint, Compass agreed to pay him a 75 percent commission split, as well as cover marketing and administrative fees. He was also offered an equity stake in the company, the complaint stated. Apart from the commission, the other fees were to be calculated at a rate of 1 percent of the total value of any exclusives he brought to Compass, capped at $9.8 million, the complaint said.
Davis said he brought three listings to Compass worth a combined $26.475 million, which translated to $794,250 in marketing, administrative and equity compensation.
But on Jan. 31, Compass “unilaterally” informed him that his compensation would now be calculated at 0.1 percent of the value of his exclusives instead of 1 percent, he said in court papers. Compass characterized the difference as a “small discrepancy,” according to the complaint, when in fact Davis’ earnings shrunk to $7,942 from $794,250.
Neither Davis nor his lawyer returned requests for comment.
Compass, which is backed by $123 million in venture capital, has opened four Hamptons offices in recent months. But it hasn’t been smooth sailing for the firm.
Last year, Brown Harris Stevens sued former Hamptons manager Ed Reale – a key Compass recruit – for allegedly violating a non-compete agreement with BHS.
And Compass in late 2015 was forced to “part ways” with agent Meg Salem, who was accused of stealing more than 11,000 listings from her former firm, Saunders & Associates. Saunders, meanwhile, hit Compass with a restraining order for allegedly stealing data from its proprietary network.