Wilfs ordered to pay $84.5M in New Jersey real estate fraud case

  • Article by: COREY MITCHELL , Star Tribune
  • Updated: September 24, 2013 - 7:02 AM

Money in fraud case going to former partners, but Wilfs’ attorneys expect the new Vikings stadium to open before the appeals process in the case ends.

hide

Vikings owners Zygi Wilf, right, and brother Mark.

Photo: Elizabeth Flores, Star Tribune file

CameraStar Tribune photo galleries

Cameraview larger

– A New Jersey judge has ordered Minnesota Vikings owners Zygi and Mark Wilf and their cousin, Leonard Wilf, to pay $84.5 million in damages to former business partners who sued them for fraud over a 1980s real estate deal.

The ruling covers compensatory and punitive damages to plaintiffs Josef ­Halpern and Ada Reichmann.

The damages awarded Monday did not include requests for more than $16 million in plaintiff’s attorney and accounting fees, which could push the damages awarded to more than $100 million.

Superior Court Judge Deanne Wilson made the ruling Monday after finding, in a decision issued last month, that the Wilfs committed fraud, breach of contract and breach of fiduciary duty and also violated the state’s civil racketeering laws in a partnership involving a 764-unit apartment complex in Montville, N.J.

Wilf attorney Peter Harvey said the Wilfs, who did not attend the hearing, were informed of the judge’s decision. He declined to reveal their reaction, citing attorney-client privilege.

The ruling is not final because the Wilfs have 45 days to appeal, potentially delaying the awarding of damages and a referral of the case to the state attorney general or county prosecutors for possible ­criminal investigation.

Halpern declined to comment after the hearing. Reichmann, his sister and wife of a prominent Canadian developer, did not attend.

“What the Wilfs did in this case was abominable,” said Halpern’s attorney, Alan Lebensfeld, adding “they are sophisticated businessmen and they took advantage of my ­client.”

The court case has been closely watched by the National Football League, Minnesota Gov. Mark Dayton and the Minnesota Sports Facilities Authority as negotiations on development agreements continue on the new $975 million Vikings stadium being financed by the team owners, the state and the city of ­Minneapolis.

The Wilfs hope to open the downtown Minneapolis stadium in time for the start of the 2016 football season. Groundbreaking is tentatively scheduled for early November.

The authority board is scheduled to vote on the ­stadium’s use and development agreements at its Friday meeting.

An independent audit conducted for the authority and completed earlier this month found that the Wilfs have enough money to cover their share, roughly $477 million, of the stadium financing regardless of the ruling. Their contribution includes a $200 million NFL loan and revenue generated from stadium naming rights, sponsorships and licensing fees.

Harvey referred to Wilson’s order as simply that — an order — that will have no bearing on the Wilfs’ or the Vikings’ ability to finance their portion of the new downtown stadium.

“The good news here, aside from the fact we believe this decision will not stand on appeal, is that nothing that the judge has decided will impact stadium construction,” Harvey said.

Harvey estimated that the appeals process “will be easily two to three years,” adding that “the stadium will be built and there will be an opening kickoff long before this case is decided.”

The authority ordered the review of the Wilfs’ finances in August at the urging of Dayton, who expressed concern that the New Jersey case and subsequent civil penalties could hamper the Wilfs’ ability to cover stadium costs.

Days after the review revealed that the Wilfs had the financial wherewithal to pay for their share of the stadium, Dayton urged the authority to make sure that the owners contributed a “significant share” of their own equity to the project and not pass on steep fees to season-ticketholders in the form of “personal seat license” fees.

Seat licenses, which typically sell for an average of several thousand dollars, are paid for by fans on top of the cost of a season ticket and are often used by NFL teams to help pay for new stadium construction.

Rep. Bob Barrett, R-Lindstrom, a longtime critic of the stadium financing deal, referred to those fees Monday as he reacted to the ruling from New Jersey. He said that the Wilfs stand to generate so much revenue off seat license fees, stadium naming rights and other sponsorships that “it is highly likely that” the Wilfs “will actually make a profit” off the stadium’s construction.

  • related content

  • Lenny Wilf

  • Zygi Wilf

  • Mark Wilf

  • get related content delivered to your inbox

  • manage my email subscriptions

ADVERTISEMENT

New England 5:30 PM
Seattle
Miami 12:00 PM
Boston
LA Lakers 1:00 PM
New York
Arizona 12:00 PM
Montreal
St. Louis 12:00 PM
Washington
Nashville 1:00 PM
Pittsburgh
Minnesota 2:00 PM
Vancouver
Miami-Florida 18 1st Half 8:51
Florida State 14
Oakland 22 1st Half 10:31
Youngstown St 20
Cincinnati 12:00 PM
East Carolina
Michigan 12:00 PM
Michigan State
Marist 1:00 PM
Canisius
Fordham 1:00 PM
Dayton
Manhattan 1:00 PM
Monmouth
Quinnipiac 1:00 PM
Niagara
Utah 1:30 PM
USC
Connecticut 2:00 PM
Houston
California 2:00 PM
Washington
North Dakota St 2:00 PM
Western Ill
Penn State 27 1st Half 0:54
(22) Rutgers 37
(14) Texas 12:00 PM
TCU
Coll of Charleston 12:00 PM
Towson
Cornell 12:00 PM
Yale
Xavier 12:00 PM
Providence
Drexel 12:00 PM
UNC-Wilmington
Stony Brook 12:00 PM
New Hampshire
Maine 12:00 PM
Albany
Miami-Florida 12:00 PM
Pittsburgh
(21) Georgia 12:00 PM
(10) Kentucky
Arizona 12:00 PM
Colorado
Wake Forest 12:00 PM
(4) Notre Dame
Loyola-Chicago 12:05 PM
Illinois State
(24) Oklahoma 1:00 PM
West Virginia
Butler 1:00 PM
Creighton
St Johns 1:00 PM
Seton Hall
Delaware 1:00 PM
Hofstra
Binghamton 1:00 PM
UMass Lowell
Vermont 1:00 PM
Hartford
William & Mary 1:00 PM
Northeastern
Boston College 1:00 PM
(16) North Carolina
Virginia 1:00 PM
Clemson
(2) Connecticut 1:00 PM
Temple
Arkansas 1:00 PM
Alabama
Virginia Tech 1:00 PM
Georgia Tech
Kansas 1:00 PM
(3) Baylor
Canisius 1:00 PM
Rider
Monmouth 1:00 PM
Fairfield
Quinnipiac 1:00 PM
Saint Peters
Wichita State 1:05 PM
Drake
Evansville 1:05 PM
Indiana State
(18) Miss State 2:00 PM
(6) Tennessee
Villanova 2:00 PM
DePaul
Georgetown 2:00 PM
Marquette
North Texas 2:00 PM
Rice
Auburn 2:00 PM
(12) Texas A&M
(11) Arizona State 2:00 PM
Utah
Missouri State 2:00 PM
Northern Iowa
Michigan 2:00 PM
(15) Nebraska
Minnesota 2:00 PM
Northwestern
Wisconsin 2:00 PM
Illinois
Bradley 2:05 PM
Southern Ill
Florida 3:00 PM
Vanderbilt
(20) Iowa 3:00 PM
(5) Maryland
(1) South Carolina 3:30 PM
Ole Miss
Connect with twitterConnect with facebookConnect with Google+Connect with PinterestConnect with PinterestConnect with RssfeedConnect with email newsletters

ADVERTISEMENT

ADVERTISEMENT

Date/Opponent Time W L Score
2014 preseason     
Aug 8 - vs. Oakland 7 pmX10-6
Aug 16 - vs. Arizona 7:30 pmX30-28
Aug 23 - at Kansas City 7 pmX30-12
Aug 28 - at Tennessee 7 pmX19-3
2014 regular season     
Sep 7 - at St. Louis NoonX34-6
Sep 14 - vs. New England NoonX30-7
Sep 21 - at New Orleans NoonX20-9
Sep 28 - vs. Atlanta 3:25 pmX41-28
Oct 2 - at Green Bay 7:25 pmX42-10
Oct 12 - vs. Detroit NoonX17-3
Oct 19 - at. Buffalo NoonX17-16
Oct 26 - at Tampa Bay NoonX19-13 ot
Nov 2 - vs. Washington NoonX29-26
Nov 9 - Bye
Nov 16 - at Chicago NoonX21-13
Nov. 23 - vs. Green Bay NoonX24-21
Nov. 30 - vs. Carolina NoonX31-13
Dec 7 - vs. NY Jets NoonX30-24 ot
Dec 14 - at Detroit 3:25 pmX16-14
Dec 21 - at Miami NoonX37-35
Dec 28 - vs. Chicago NoonX13-9

ADVERTISEMENT

ADVERTISEMENT

ADVERTISEMENT

question of the day

Poll: Who wins the Super Bowl?

Weekly Question

ADVERTISEMENT

 
Close