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Former Keller Williams CEO John Davis took intention at Gary Keller in a press launch Monday, alleging the Keller Williams co-founder runs the corporate “much like a prison enterprise.”
Davis’s announcement comes as a federal district court docket in Fort Value, Texas, is deliberating whether or not to have Davis’s authorized claims in opposition to Keller, Keller Williams, and former KW President Josh Crew dealt with beneath arbitration.
Within the fall, Davis filed a lawsuit in what Davis mentioned is an effort to revive his status after sexual misconduct allegations in opposition to him surfaced earlier in 2022 and to get better $300 million in damages. The Oct. 27 criticism additionally names Inga Dow, the CEO of a number of Keller Williams places of work who lodged the allegations in opposition to Davis, as a defendant. On the finish of January, the court docket refused Keller’s request to merge the fits filed by Davis and Dow, ruling that they may proceed as two separate circumstances.
In his go well with, Davis alleges he resigned from KW due to a disagreement with Keller over a enterprise technique that he believed would herald much less revenue to Keller Williams places of work, and that Keller and Crew responded by smearing him and withholding Dow’s accusations from him when he was negotiating the sale of his KW market middle areas after his resignation, leading to tens of tens of millions in monetary losses.
“Mr. Davis seeks a trial by his friends to shine the sunshine on how Gary Keller, Josh Crew, and Keller Williams Realty leaders run their enterprise and hurt the very those who made Gary Keller, Josh Crew and others rich,” mentioned Paul Omodt, spokesman for John Davis, within the announcement Monday. The discharge was issued by the regulation agency representing Davis, Nesenoff & Miltenberg.
“Our most up-to-date movement earlier than the court docket seeks a public discussion board and argues in opposition to Keller Williams’ use of arbitration to protect its misdeeds publicly. Mr. Davis and his staff consider within the energy of their case and consider Gary Keller and his scheme have equally harmed others.”
Keller Williams spokesperson Darryl Frost despatched Inman an emailed assertion on behalf of Keller Williams, Keller, and Crew.
“Sadly, Mr. Davis is utilizing the court docket system, and now his paid publicist, as a car to claim unsubstantiated, unwarranted, and disparaging claims in opposition to Keller Williams and Mr. Crew,” Frost mentioned.
“We sit up for the chance to disclose his claims for what they’re — an try and misdirect consideration and lay blame the place it shouldn’t be.”
Keller, Keller Williams, and Crew filed a movement to compel arbitration in Davis’s case on Feb. 8, arguing that Davis signed “quite a few agreements” with the defendants that embrace arbitration clauses. On Feb. 13, Dow instructed the court docket she agreed with Keller Williams that Davis’s claims — together with these in opposition to her — ought to be resolved beneath arbitration.
However on Feb. 16, Davis instructed the court docket that an settlement he signed with Keller Williams on Nov. 4, 2020 “expressly cancels all earlier contracts and agreements.”
Furthermore, Davis’s attorneys argued that the arbitration settlement the defendants search to implement is “unconscionable” as a result of it’s designed to stop franchise homeowners from suing and subsequently protecting Keller Williams’ alleged wrongdoings from coming to mild.
“Defendants are improperly attempting to silence Davis by broadening the phrases of the arbitration settlement, due to the potential for extra widespread litigation ensuing from the harms dedicated by Keller Williams and Gary Keller via the devaluation of many franchise homeowners’ pursuits through the years,” the submitting reads.
“The KW Defendants’ current movement earlier than the Courtroom — searching for to remain this case and compel arbitration — is a component and parcel of the KW Defendants’ calculated efforts to keep away from legal responsibility and deter others, together with KW franchise homeowners, from asserting their authorized rights. Such reasoning for secrecy is in opposition to public coverage.”
Davis’s attorneys particularly slam Keller and the best way he operates Keller Williams.
“The KW Defendants, and extra notably Gary Keller, run Keller Williams much like a prison enterprise, whereby investments and pursuits are taken or devalued via illegal ways, whether or not via improper discount of market caps or different means, due to Gary Keller’s greed,” the submitting reads.
“Franchise proprietor victims who’re focused by Gary Keller haven’t any alternative however to just accept considerably lower than market worth presents or face shedding their investments via additional devaluation. A number of franchises are so considerably devalued by Gary Keller and Keller Williams that their homeowners haven’t any alternative however to surrender their investments. Gary Keller and people near him have largely profited via the devaluing of pursuits of franchise holders for a few years, they usually proceed to take action so far.”
Davis’s announcement Monday emphasised that the court docket’s most up-to-date ruling denied Keller Williams’s “authorized maneuvers to maintain the case secret and hidden … in favor of the general public’s proper to know.”
That ruling was on Feb. 17 when the court docket denied the Keller Williams defendants’ motions to seal each their movement to dismiss and the entire filings associated to their movement to compel arbitration, which is why the filings are publicly obtainable.
In that very same order, Choose Reed O’Connor condemned “querulous conduct” and a “sample of abrasive conduct” from the entire events within the case and threatened the attorneys concerned with sanctions for “[a]ny future deviations” from a “excessive normal {of professional} conduct.”
In a Feb. 20 reply to Davis’s submitting, attorneys for Keller, Keller Williams and Crew don’t handle Davis’s allegations concerning the operation of Keller Williams. Reasonably, they argue that Davis’s place that the topic arbitration settlement is unconscionable is “unsupported.”
“[T]right here is nothing within the Settlement’s arbitration provisions that’s ‘sufficiently surprising or gross to compel the court docket to intercede,’ which is the usual for substantive unconscionability,” the submitting reads.
“Lastly, arbitration will not be in opposition to public coverage,” the submitting continues. “It’s effectively established that arbitration of disputes between events is strongly favored beneath federal and state regulation.”
Dow didn’t reply to a request for remark.
Editor’s be aware: Inman acquired an amended remark from Keller Williams noting the corporate was additionally responding on behalf of Crew and Inman has up to date the story with that remark.
E mail Andrea V. Brambila.
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