Former FrontDoor CEO files suit

-A A +A
By Jenny Hartley

A Charlotte businessman has opened the door to a court case in Lancaster County.

Robert M. Davis Jr., former chief executive officer of the failed FrontDoor Communications, has filed a lawsuit against Carroll Edwards and Dean Harrell.

Harrell asked County Council last year to authorize $300 million in bonds for development at Catawba Ridge, which is in western Lancaster County along the Catawba River.

Davis is suing Harrell and Edwards, Harrell's business partner, for breach of contract.

Catawba Ridge 4400 LLC, Catawba Ridge 200 LLC and Catawba Ridge North LLC – all part of Harrell and Edwards' proposed project – are also named in the suit.

Stephen Goodwin, an attorney working with Harrell and Edwards, is also listed as a defendant.

The suit was filed Jan. 8 at the Lancaster County Courthouse.

Familiar name

Davis' name is familiar to many in Lancaster County. County and state officials, including Lancaster native and then-Gov. Jim Hodges, lauded Davis' proposal in 2002 to start a media company called FrontDoor Communications at Catawba Ridge.

The company was supposed to bring 1,600 jobs and a $150 million investment to the county. But FrontDoor only opened temporary offices in Lancaster County, hired only a handful of people and published a few issues of a Charlotte magazine before it folded.

The controversy centered mainly around $636,569 improperly advanced to FrontDoor by the county as part of an incentive package.

Former County Administrator Chap Hurst disbursed the funds based on a letter offering incentives to the company, rather than on a contact signed by County Council.

In 2003, the FrontDoor fiasco caused deep divisions on County Council, and almost cost Hurst his job. Several County Council members lost their seats in the wake of FrontDoor's failure.

The funds advanced to FrontDoor were returned to the county in 2005 when Davis became involved in a new company called Focal Pointe, which bought land at Catawba Ridge.

Partnership disputed

When Harrell and Edwards approached County Council with their project last year, they told council members that the only connection they had to Davis was the 200 acres they bought from Focal Pointe.

But Davis' suit claims that Davis – formed a partnership with Harrell and Edwards, by which the property was acquired by (Catawba Ridge 200 and Catawba Ridge 4400), which would share title to the property with Davis.

The parties agreed that Focal Pointe's property would be sold to Catawba Ridge 200 for roughly $3.4 million, with the understanding that Davis would have a 1/3 ownership interest in the property, according to the suit.

The parties also agreed to buy another 4,410 adjacent acres at Catawba Ridge to develop the tracts into a mixed-use and commercial development known as Catawba Ridge North, according to the suit.

Harrell told County Council in January 2007 that the development would include homes, several golf courses and a luxury hotel.

Davis would own 10 percent of the property at Catawba Ridge 4400, according to the lawsuit.

"Unbeknownst to Davis until after the fact, Harrell and Goodwin were specifically asked by staff and members of Lancaster County Council whether Davis was involved in the project, and they repeatedly denied (i) that he (Davis) had anything to do with Catawba Ridge, and (ii) that he had any ownership interest therein," the suit reads.

Davis later sought a buyout of his interest in the Catawba Ridge property, according to the suit.

Davis is claiming that Harrell and Edwards agreed to pay Davis and Focal Pointe $3.8 million, including an initial payment of $270,000 at signing, roughly $3 million on or before Aug. 27, 2007, $50,000 in shotguns chosen by Davis and another $500,000 payable on or before Aug. 31, 2009.

The suit claims that Harrell signed the settlement agreement individually and on behalf of Catawba Ridge 200 and Catawba Ridge 4400. Edwards has refused to sign it.

Davis has been paid $270,000 and another $50,000 instead of the shotguns, the suit says. But no other payments have been made.

Davis' suit claims that he has been wrongfully excluded from a partnership concerning the Catawba Ridge property.

Davis has requested a jury trial. His attorney, Daniel J. Ballou of Rock Hill, said the defendants were served with the suit last week and have 30 days to reply.

Ballou said a court date has not been set because "it's very early on in the case," and didn't comment further on the suit.

"We've laid out the facts the best we can in the complaint," he said.

Harrell said Catawba Ridge 4400's legal staff is reviewing documents and will issue a statement. No statement was issued by press time Tuesday.

Project in limbo?

Although some members of County Council were supportive of Harrell's project last year, the council did not authorize bonds for it, and asked Harrell to come back to council with more definite plans and site drawings. Harrell never did.

Council Chairman Rudy Carter, who was on council during FrontDoor dealings, didn't say much about the lawsuit Monday, but said the project "was in limbo, as far as I know. I think Harrell is trying to sell the property."

And although he expressed initial support for Harrell's project last year, "there was still a lot of unanswered stuff on that," Carter said.

Contact Jenny Hartley at 283-1151 or jhartley@thelancasternews.com