Court Allows Businessman to Join Chill Can Foreclosure Case

YOUNGSTOWN, Ohio – Mahoning County Common Pleas Judge John M. Durkin has granted a motion by a Columbus-area businessman to join a foreclosure action filed earlier by MS Consultants against M.J. Joseph Development Corp.

Richard Briskey, of Sunbury, Ohio, was awarded a $2,582,470 default judgment by the Franklin County Common Pleas Court in November against Joseph Development, Joseph Manufacturing Co., Joseph Co. International and CEO Mitchell Joseph.

The Joseph companies failed to respond to Briskey’s complaint, and there is no attorney of record filed on behalf of the defendants in that case.

Documents show the judgment is related to loans and notes Briskey tendered to the company between May 2018 and September 2020. Court papers say that the promissory notes and loans totaled $2,821,500, of which the Joseph entities have since paid $144,030.

According to court papers, the debt remains outstanding. On Jan. 3, Briskey asked to join a foreclosure complaint against Joseph Development that was filed in July 2023 by MS Consultants, a Columbus-based engineering and architectural firm that is attempting to collect $322,907.54 from Joseph Development.

In March 2023, the court awarded MS Consultants a default judgment for the entire amount. That case is now under appeal before the 7th District Court of Appeals.

The parties in the foreclosure matter seek to force a sale of 22 acres and three empty buildings on the city’s East Side where the stalled Chill Can project sits. In 2016, CEO Joseph announced plans to construct a campus devoted to manufacturing the world’s first self-chilling beverage cans and create more than 230 jobs. After seven years, the project remains unfinished. The company’s latest reports show one job was created.

MS Consultants and Briskey want the court to allow the sale of the property so the parties can recoup money owed to them from their respective judgments.

Court documents also show this is not Briskey’s first legal matter related to the Chill Can project.

In June 2017 and October 2017, Briskey filed two lawsuits totaling $1.2 million against Garry Savage, a former investment advisor who has been indicted for securities fraud and is incarcerated in Erie County, Ohio. Briskey won both judgments that year. In March 2019, the court closed the case, citing that the judgments were satisfied.

At the time, Savage was soliciting investment for Coast-to-Coast Chill, a company that was to raise money and then reinvest in Joseph Development’s Chill Can project in Youngstown, according to prosecutors. 

Savage was indicted on 86 felony charges in November 2021. The state alleges Savage would use investors’ money to pay back earlier investors or use it for his personal expenses. Savage was arrested in May 2022 and has pleaded not guilty. He awaits trial.

According to prosecutors, Savage bilked at least 13 investors out of hundreds of thousands of dollars.

Prosecutors allege that while some of the investors’ money was directed to Joseph companies, other funds were used to either pay off earlier investors, used to satisfy Savage’s debts or used for his personal expenses.

According to a bill of particulars related to the case filed in August 2022, prosecutors say Savage used some of the investors’ money to pay off Briskey in the wake of the court judgment.

In all, court papers identified five transactions between June 2017 and February 2019 that total $500,000 that prosecutors say Savage used to pay Briskey related to the court settlement.  Savage used investor money to pay off other investors as well, the government says.

Meanwhile, the Chill Can site on the city’s East Side remains idle, and the Joseph companies are embroiled in legal matters with the city and MS Consultants.

In June 2021, M.J. Joseph Development, anticipating legal action by the city of Youngstown, filed a complaint against the city. That complaint asked for a declaratory judgment against the city that would prohibit it from collecting more than $2 million from the developer for breach of contract. 

The city countersued the following month, seeking a $1.5 million repayment of a development grant it awarded the developer in 2017. The city also sought an additional $733,480 to compensate for costs it incurred for demolition and relocation expenses. 

In November 2022, Judge Maureen Sweeney upheld an earlier ruling by Magistrate Dennis Sarisky that ordered M.J. Joseph to repay the city its $1.5 million. In July 2023, the court also awarded the city another $733,480 in sanctions related to the stalled project.

Last month, however, Joseph’s attorneys, Bran Kopp and Justin Markota of Betras, Kopp and Markota, asked the court that they be removed from representing M.J. Joseph as counsel in all three legal matters.

The appeals court approved the lawyers’ request Dec. 22 and has given Joseph 30 days from that date to secure new counsel. Durkin on Dec. 13 also granted the attorneys’ request in the foreclosure matter and has stayed proceedings for 30 days so Joseph Development can have time to secure representation.

The attorneys’ request has not yet been approved by Sweeney’s court in M.J. Joseph’s case with the city, records show.

Copyright 2024 The Business Journal, Youngstown, Ohio.