Black-led group behind $5B revamp of Oakland Coliseum sued by members

A consortium of Black-owned investors offering to buy and redevelop the Oakland Coliseum could be shattered by an investor lawsuit.

Two purported stakeholders of the African American Sports & Entertainment Group have filed a lawsuit claiming it cut side deals for equity stakes of the proposed $5 billion redevelopment of the 155-acre complex at 7000 South Coliseum Way, the San Francisco Business Times reported.

Brien Dixon and Karim Muhammad, who each claim to own a quarter share, allege breach of fiduciary duty, interference with contractual relations and unfair business practices. 

Their lawsuit names Raymond Bobbitt and Levant Ogbulie, who each own a quarter stake in

the Sacramento-based AASEG, as well as the consortium, AASEG Land and AASEG Development & Investment as defendants.

The suit seeks to cut Bobbitt and Ogbulie from their membership in the limited liability company and to delegitimize the stakes of four other people who were brought into AASEG, according to the Business Times.

It also seeks unspecified damages, attorney’s fees and a full review, audit and possible closure of all bank accounts created by Bobbitt, AASEG and affiliates of the Coliseum redevelopment project.

Bobbitt hadn’t yet seen the suit and declined to respond to the complaint.

The Coliseum complex currently is home to baseball’s Oakland Athletics and formerly hosted the Warriors and football’s Oakland Raiders.

The A’s bought half the property rights to the Oakland-Alameda County Coliseum complex in 2019 for $85 million. The City of Oakland has cut a deal with AASEG for the Coliseum redevelopment. The group has offered $115 million to buy the city’s half-interest in the property.

Last month, the A’s rejected an offer by AASEG to buy its share of the East Oakland site. The A’s want to move the team to a new, taxpayer-supported ballpark in Las Vegas by 2028.

The rejection threatens to hold up the $5 billion redevelopment the group is planning in partnership with the city, which would turn the rundown baseball stadium, sports arena and parking lot into a center for Black-owned sports teams, housing, retail, restaurants and nightlife.

Alan Dones, managing partner and co-founder of the Strategic Urban Development Alliance, is an integral part of AASEG, as is Jim Reynolds, head of Chicago-based Loop Capital.

Dixon and Muhammad allege Bobbitt inserted his own business, AASEG Land, instead of the original AASEG organization into the exclusive negotiating agreement deal with the city, according to the lawsuit.

“Not only is this a patent violation of Bobbitt’s obligations to AASEG and the other three members, it usurps a business opportunity from AASEG and could also be considered as an act of fraud committed against the City of Oakland,” the lawsuit states.

AASEG was founded in September 2020 with Dixon, Muhammad, Bobbitt and Ogbulie as member-managers, the suit says. The following year, the group founded AASEG Development & Investments to take in third-party capital for AASEG business deals, the suit says.

But that same year, Dixon and Muhammad learned Bobbitt had “unilaterally and without authority promised ownership interests in AASEG” as well as equity in the development project to Samantha Wise, LaNiece Jones, John Jones III and Jonathan Jones without the consent of the other three AASEG founders, according to the complaint.

The suit claims the four new individuals were promised a 12.5 percent interest share in AASEG. It also claims Bobbitt, installed as the “managing member,” created a slew of similar sounding “rogue companies” that could be substituted for AASEG on contracts and corporate documents, without notice.

An October 2021 election included Wise and Jonathan Jones, who voted with Bobbitt to bring on the four new members, the suit says. Dixon and Muhammad voted no and Ogbulie abstained, the suit says.

“[M]y brother … I’m not happy. … I just gotta be real … we just went from 25 pct to 12.5 pct,” Dixon said in a text to Ogbulie after the vote, according to the suit. “I’m not a founder … I’m just a member. It’s a big difference. And it just got stolen tonight. This isn’t my company.”

— Dana Bartholomew

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