Milwaukee development firm Irgens Partners LLC will not have to battle its former partners in public.
Milwaukee County Circuit Court Judge John DiMotto ruled Thursday the breach of contract case brought against the firm by Keith Redding and Kristine O’Meara in April would be decided in arbitration.
Redding and O’Meara had been fighting to have the case decided before a 12-person jury while firm owner, Mark Irgens requested it be settled privately.
During his ruling, DiMotto cited several instances of Wisconsin case law where the court encouraged arbitration as a “swift, inexpensive process.”
Ultimately, his decision was based on previous separation agreements Redding and O’Meara made with Irgens Partners when they left the firm in 2006 and 2012, respectively, that said disputes would be settled in arbitration.
“From the very start, this has been an unfortunate, greed-induced attempt by Ms. O’Meara and Mr. Redding to sidestep contractual obligations to which they had originally agreed,” said an Irgens spokesperson. “O’Meara and Redding sued us without any attempt to express and discuss their concerns. The agreements call for arbitration and (their attorney) continues his polemic process of trying to destroy our reputation. What is confusing to us is that we have volunteered to distribute the money in question and to roll back the amended operating agreements and they continue to complain and not take the money.”
A spokesperson for Redding and O’Meara said while they disagree with the ruling, the decision only changes the venue where the relief that is owned to them will be given.
“All of our present claims continue, and it is likely additional claims will be brought in the new forum to which the court has directed,” the spokesperson said.
Redding and O’Meara are seeking $900,000 from the sale of the Whole Foods building on Milwaukee’s East Side. The building sold in December for $22.2 million
The two are also alleging nine of the 17 operating agreements in which they have an ownership stake were changed in October 2016 without their knowledge and to their disadvantage.
The amendments lowered the super majority needed to make decisions about the properties and gave Irgens the ability to move money from one property to another.
Irgens has offered to pay his clients the $900,000 from the Whole Foods sale, but cannot do it until a restraining order, put in place when the lawsuit was filed to prevent any further changes to operating agreements, is lifted.
“Given the serious nature of our complaint, the court today also ruled that the temporary restraining order granted in April remains in place,” a spokesperson for Redding and O’Meara’s said. “Unilaterally altering contracts, retaining funds that should have been disbursed, and then planning to or using those funds without our knowledge or consent is not only disturbing, but impermissible. We are deeply disappointed that the actions of our former partner have brought us to this point. We will continue to pursue our claims in this matter to get the fairness and justice we are entitled to.”
In 2006, Redding was forced to sell his interest in Irgens and leave the company after 15 years, according to the complaint filed in April. He signed a separation agreement worth $2.3 million. Through December 2016, he has made another $7 million to $8 million on the properties in which he has an ownership stake, according to Irgens attorneys.
O’Meara opted to retire early in 2012 because “she could no longer stand the working environment,” according to the complaint filed in April. She was paid $1.35 million and has made another $6 million through December 2016 on properties in which she has an ownership stake, according to Irgens attorneys.
Both signed separation agreements promising not to disparage the company and agreeing to arbitration. The original operating agreements specified that all disputes among Irgens partners would be handled in arbitration.
But the nine amended operating agreements specify disputes will be handled in circuit court.
