Lender Owed $2.5M Seeks to Join Chill Can Foreclosure Case
YOUNGSTOWN, Ohio – A lender from the Columbus area who was recently awarded a judgment of more than $2.5 million in damages against M.J. Joseph Development Corp. has filed a motion to intervene in a foreclosure matter involving the developer’s ill-fated Chill Can project.
Attorneys representing businessman Richard Briskey of Sunbury, Ohio, on Jan. 3 filed papers with Mahoning County Common Pleas Court to join a foreclosure case filed last year against Joseph Development by MS Consultants Inc., a Columbus-based architectural and engineering firm that has offices in Youngstown.
On Nov. 29, Franklin County Common Pleas Judge Andria Noble awarded Briskey $2,582,470 in a default judgment against Joseph Development, Joseph Company International, Joseph Manufacturing Co., and CEO Mitchell Joseph, according to court papers.
Documents show that the money is related to loans Briskey tendered to Joseph and his companies through promissory notes or written or verbal agreements beginning in May 2018 through September 2020. Court papers say the promissory notes and loans totaled $2,821,500, of which the Joseph entities have since paid $144,030.
The Joseph companies failed to file a response to a complaint Briskey filed in August 2023, alleging Joseph Development was in breach of contract and enjoyed unjust enrichment, court papers show. Absent the response, Noble granted judgment in favor of Briskey.
The time frame of the Briskey loans coincides with Joseph Development’s efforts to construct a proposed $20 million manufacturing and research campus in Youngstown that would produce self-chilling cans and chilling technology. The project was never finished, and Joseph companies are embroiled in legal battles with the city and MS Consultants.
MS Consultants in January 2023 filed a complaint in Mahoning County Common Pleas Court against Irvine, California-based Joseph Development seeking $322,907.54 plus interest for money it says it’s still owed for work the company did on the Chill Can project.
In March, the court awarded MS Consultants a default judgment for the entire amount. The matter is under appeal before the 7th District Court of Appeals.
MS Consultants in July followed the judgment by filing a separate foreclosure action against Joseph Development, asking the Common Pleas Court for a lien on the 22 acres at the Chill Can site on the city’s East Side. The complaint seeks a court order to force the sale of the property and award MS Consultants money from the proceeds it says it is owed.
Now Briskey is asking court approval to intervene and collect funds it says it is owed from any sale of the property.
In a twist last month, Joseph’s attorneys – Bran Kopp and Justin Markota of Betras, Kopp and Markota – asked the court that they be removed from the MS Consultants case.
The appeals court approved the lawyers’ request Dec. 22 and has given Joseph 30 days to secure new counsel. Common Pleas Judge John 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.
Kopp and Markota have also asked the court to be removed from M.J. Joseph’s protracted legal battle with the city of Youngstown. That motion is still pending before Judge Maureen Sweeney’s court.
Kopp has represented the company since June 2021, when M.J. Joseph Development, anticipating legal action by the city of Youngstown, filed a complaint against the city in May of that year. 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.
Mitchell Joseph had pledged in 2016 to invest nearly $20 million to construct a complex on the East Side that would produce self-chilling beverage cans and employ more than 230 people. Three empty buildings were constructed, and the project has yielded just a single employee. Not a single can was produced.
In November 2022, 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.
Copyright 2024 The Business Journal, Youngstown, Ohio.