Correction, 1:22 p.m.: Story amended to reflect clarification from Jason Milligan regarding a Sept. 7 email exchange. Updated, 6:44 a.m.: Information added; 6:16 a.m.: Copy edits
NORWALK, Conn. — A court action against POKO property owner Jason Milligan and former owner Richard Olson has been withdrawn, and a new one filed, according to Norwalk Corporation Counsel Mario Coppola.
The new lawsuit “alleges that the parties, among other things, breached the LDA by conveying Phase II and Phase III properties in the project at 21, 23 and 31 Isaacs Street and 83 and 97 Wall Street without the consent of the Agency,” according to a press release sent by Norwalk Communications Manager Joshua Morgan late Monday.
The press release said:
“The Agency and City contend in the lawsuit that the recent actions of the defendants thwart the letter and spirit of the LDA, unjustly enrich the defendants, and constitute unfair trade practices. The public parties to the agreement, invested a substantial amount of thought, time, effort and expense in designing a development plan with the Approved Redeveloper for this site. The LDA sets forth the duties and responsibilities of the parties in realizing that objective. This legal action intends to uphold the integrity and the contractual validity of the LDA, by invalidating the defendants’ actions. The defendants’ action sought to willfully undermine both the City and the Agency’s ability under the LDA to protect the public’s significant investment and interests in this project. The Agency and City believe that enforcing the LDA is of great public importance and is crucial to ensuring that the ultimate site development realizes the intended public benefits that were agreed to by the parties.”
“It’s because I’m winning,” Milligan said. “Mario is scared,” he alleged.
“They were violating my civil rights. We spoke up very loudly about it,” Milligan said. “We were preparing to bring a civil rights complaint against Mario, the City, Darin (Callahan), others and we are not surprised that they withdrew the fraudulent transfer portion of this. They may bring other stuff. We are prepared to defend it. It’s a big waste of everybody’s time and money.”
Coppola in an evening email called Milligan’s comments completely untrue.
Milligan in August claimed Callahan, Assistant Corporation Counsel, told Assistant Building Official Leo Guerrero to void Milligan’s demolition permit for 21 Isaacs St.
Callahan has not replied to an Aug. 17 email from NancyOnNorwalk seeking a response to the allegation.
The City and the Norwalk Redevelopment Agency on June 18 filed an application for a prejudgement remedy and hearing. The filing alleged that Milligan’s Wall Street Opportunity Fund LLC and Olson’s ISLR Owners LLC had violated the Land Disposition Agreement for 21, 23 and 31 Isaac St., and 83 and 97 Wall Street, by transferring ownership from ISLR to WSOF without Redevelopment Agency approval. The LDA is an agreement between the City and the developer governing how the properties must be developed.
The properties were all slated to be part of “POKO” Phase II and III. Phase I has been stalled since mid-2016 and Milligan recently dubbed it “the Tyvek temple” because it’s wrapped in Tyvek.
The joint City/RDA legal maneuver asked that the Stamford Superior Court garnish WSOF’s POKO property for $5 million.
“They brought a frivolous lawsuit,” Milligan said late Monday. “They claimed fraudulent transfer. On its face, that is bogus, completely bogus. Mario was personally liable for that one. That coupled with his other actions was building a very nice civil rights action. So Joe Williams got involved, spoke to my attorney, and sternly suggested that they withdraw that fraudulent transfer, and then a few days later it’s withdrawn.”
Milligan and his attorney for the case, David Rubin, on Sept. 7 requested a meeting with Attorney Joseph Williams, a partner at Shipman & Goodwin LLP who was retained to represent the Redevelopment Agency, and Sheehan, Milligan said. That didn’t happen, but Rubin told them the fraudulent transfer claim was bogus and “they’d better be careful,” basically saying, “I don’t want it to escalate but it will escalate very soon if you don’t withdraw that,” according to Milligan.
The Common Council and the Redevelopment Agency each held an executive session about the lawsuit last Tuesday, Sept. 11.
A trial was scheduled for Sept. 25. Milligan on Friday filed a motion asking that the matter be moved to the complex legal docket, given the complexity of the LDA. The action was withdrawn Monday.
Coppola, speaking to NancyOnNorwalk late Monday afternoon, said that wasn’t a lawsuit but an action seeking a remedy. That was being withdrawn and a lawsuit was filed, with the input of Williams, he said.
“I don’t want to fight a legal battle.… What do I win?” Milligan said. He added that a successful civil rights action would be lucrative but, “I don’t want to do that, I don’t want to punish the City, I want to do business here.”
Coppola in a late evening email wrote:
“There is absolutely no truth whatsoever to Mr. Milligan’s assertions. Today the Agency and City served Mr. Milligan and other defendants with a lawsuit for knowingly violating the 2007 Land Disposition Agreement, and other agreements, concerning the POKO project. The lawsuit that was served today replaced the application for prejudgment remedy that was previously pending against the defendants.
“Just to be clear, an application for prejudgment remedy is a pre-commencement proceeding, meaning an action that is filed for the purpose of freezing a defendant’s assets in anticipation of filing a lawsuit. After discovering additional information and evidence, the public parties decided to just go forward immediately with serving the full lawsuit today. The lawsuit effectively seeks the same relief as the application for prejudgment remedy, but adds additional claims for relief and defendants.
“It seems as if Mr. Milligan is trying to spin the story regarding this lawsuit in order to avoid any focus on the actions of the defendants as alleged in the lawsuit. We are not going to engage in a pointless back and forth with Mr. Milligan. The lawsuit speaks for itself.”
“I’d love to have a discussion,” Milligan said late Monday. “We get so stuck in little legal wrangling and the positioning, and we lose sight of the bigger picture. We never get to talk about the big picture.”
The City could have withdrawn the legal action and discussed the issues with him before filing a new lawsuit, he said.
Milligan was previously sued for a Norwalk real estate action, when the Norwalk Public Library Foundation appealing a Norwalk Zoning Commission approval for apartments he planned for Mott Avenue. That lawsuit was settled in January.
“They insist on keeping me under lawsuit so that they don’t have to be exposed for being completely useless and incompetent,” Milligan said. “I’m winning at their stupid game, I don’t want to play lawsuits. I am winning this stupid battle, they are choosing to have this stupid battle here. I would much rather have a battle of ideas. I welcome anybody, and I’ll take 10 of them, put their ideas over.”
Citibank owns POKO Phase I after foreclosing on the original developer. City officials are working with Citibank to try to restart the project. A deadline looms. Sheehan said in emails obtained through a Freedom of Information Act request that Citibank’s preferred developer JHM wanted to get changes approved while Gov. Dannel Malloy was in office. There’s also an issue of tax credits expiring in November.
Milligan in June asked to be considered as the redeveloper for POKO Phase II, which was approved in 2007 under then-Mayor Alex Knopp.
“If their idea is still to have that tired, 20-year-old shitty plan, then fine, I don’t have a problem discussing that,” Milligan said Monday. “It’s got a pretty good track record so far. Four Mayors, millions of dollars, no parking, white Tyvek building sitting there, bankrupt, foreclosed on and no end in sight. Awesome. What’s the excuses? They want to hide, they want to crawl under a freaking rock, and that rock is the court system. They can hide, they can be quiet, they can say, ‘We can’t talk, it’s in the court system.’”
Milligan and City officials have been at odds since the purchase. A source told NancyOnNorwalk in June that Mayor Harry Rilling was unlikely to speak with Milligan again after being assured by the developer on May 31 that he wasn’t going to close on “POKO Phase II” the next day, only to find out that Milligan had already bought the properties when the comment was made. When the City filed its original court action, Milligan’s early response included insults directed at Rilling.