Regalia in Sunny Isles Beach
Despite being sold out in 2015, two years after it was completed, controversy still swirls around the Regalia condo project in Sunny Isles Beach. Last week, Miami law firm do Campo & Thornton sued the project’s original developers and one of their creditors in Miami-Dade Circuit Court over unpaid attorney fees.
Robert Stok, partner for the Aventura law firm Stok Folk + Kohn, which represents defendants Abraham Cohen, Jerold Kaufman, Petr Viskovatykh, CK Regalia and La Mansion, told The Real Deal that do Campo’s complaint has no merit. “It is surprising to me that lawyers who created so much damage would put themselves into the line of fire,” Stok said. “We expect a jury to view do Campo & Thornton’s antics with great disfavor. Do Campo & Thornton is going to have to reimburse our clients for all the damages they caused.”
Do Campo’s attorney Alejandro Brito scoffed at Stok’s comments in a phone interview with TRD. “My clients provided legal services for which they are entitled to be compensated,” Brito said. It is ironic that the defendants are claiming that they intend to cooperate in paying my clients the money they are owed.”
The dispute arose in 2010 when Cohen retained do Campo to defend him against a foreclosure on the project’s construction loan that he had personally guaranteed. Cohen and Kaufman owned the voting interest in La Mansion, which was a creditor for the development, and CKR, which was a minority owner in the Regalia project at 19575 Collins Avenue. According to do Campo’s lawsuit, Kaufman subsequently pledged the equity interest in CKR to Viskovatykh.
By 2012, a year after the project was sold to a group led by Louis R. Montello, CKR and La Mansion were defunct and had no assets other than other than a minority stake in Regalia, the lawsuit says. A year later, Cohen, La Mansion and CKR signed a retainer agreement with do Campo for the firm to protect Cohen’s potential equity in 46-story tower once it was completed, according to the suit.
In 2013, Cohen, La Mansion, and CKR all entered into a retainer agreement with do Campo to protect Cohen’s potential equity. These retainer agreements were the product of additional negotiations with Kaufman. Viskovatykh was also aware of these agreements. Under the retainer, do Campo’s fees would be determined from Cohen’s net position once Regalia was finished, the suit says.
Consistent with the terms of the retainer agreement, do Campo represented the defendants in the hopes of securing a large recovery for them, Brito said. His clients, as well as Cohen, Kaufman and Viskovatykh, actively monitored the real estate market and Regalia sales. If the condo recorded exceedingly high sales prices, then Cohen and the others would receive a huge windfall, Brito said.
The tower reached $100 million in sales just two months after launching, according to the suit. This year, four units have closed with prices ranging from $8 million to $12 million. The last recorded sale was for an $8.4 million unit that was sold to Alfredo Bubion, president of the Regional Steel Corp.
To avoid paying do Campo a substantial sum in attorney fees, Cohen, Kaufman, and Viskovatykh abruptly terminated their relationship with the law firm in 2013, the lawsuit alleges. Cohen, Kaufman and Viskovatykh then sued do Campo to remove liens filed by the law firm against La Mansion and CK Regalia for non-payment. The lawsuit was dismissed and last March, a Florida appeals court affirmed the dismissal.
According to its lawsuit, do Campo is owed fees under three separate retainer agreements that would have totaled between $1 million to $2 million.
Stok claimed do Campo performed only “nominal work” for his clients. “They have filed a completely frivolous, baseless and bombastic lawsuit accusing our clients never had any intention to pay them which is totally without any basis in fact,” Stok said. “We intend to vigorously defend the lawsuit and hold the law firm accountable for malpractice.”
Brito said do Campo has ample proof Stok’s clients had no intention of paying the law firm. “The defendants received a substantial amount of money as a result of my clients’ efforts. The fact the defendants have not paid any money to my clients makes it clear as to who has engaged in the wrongful conduct.”
Source: The Real Deal Miami