Christian Laettner Sued His Own Business for $10 Million. Now Some Former Partners Are Suing Him. | Durham County | Indy Week
Pin It

Christian Laettner Sued His Own Business for $10 Million. Now Some Former Partners Are Suing Him. 

Former Duke basketball star Christian Laettner was so reviled that the ESPN documentary about him, released last year, is literally called I Hate Christian Laettner. Somewhat paradoxically, in examining five specific qualities that made him so hateable—white, privileged, handsome, a bully, one of the greatest college basketball players of all time—the film ultimately succeeds in humanizing Laettner.

Probably wisely, the documentary avoids delving into Laettner's side career in the business world. To do so would have been an awkward detour out of the exciting and accessible world of sports into the abstruse domain of real estate development and finance. It would also have interfered with the narrative of Laettner as a winner.

As many Durhamites are aware, Laettner, his former teammate Brian Davis, and developer Tom Niemann were early arrivers in Durham's downtown revitalization. In the late 1990s, they formed Blue Devil Ventures, which leveraged historical tax credits, HUD money, and other incentives to purchase five old tobacco warehouses. Blue Devil Ventures converted those properties into the West Village: 241 residential units and 36,000 square feet of commercial space.

That was the first phase. In 2002, the group began planning a second. It wanted to purchase seven more warehouses adjacent to the West Village. To buy all that property and transform it into lofts, retail, and office space, however, Blue Devil Ventures needed capital.

Davis knew an investment banker named Rhahime Bell, a managing director at Paine Webber. Another director, Peter Ghavami, as well as Gary Heinz (who worked under them), signed on to help finance the second phase. They formed a developmental entity called BDV III. The entity consisted of Laettner, Davis, Niemann Capital, Heinz, Julie Britton (Ghavami's wife), and RBell Holdings.

About those people:

• Ghavami and Heinz were convicted in 2012 for a municipal bond-rigging scheme. As employees of UBS, they got kickbacks while colluding with brokers to drive up the rates cities across the country paid to finance public projects. Heinz was sentenced to twenty-seven months in prison; Ghavami got eighteen months.

• In 2007, Bell sued Blue Devil Ventures over a $200,000 loan. They settled out of court.

• Laettner and Davis's struggles over the last decade have been well publicized. They attempted, without Niemann's help, to put together projects like the West Village in other cities such as Baltimore and Philadelphia. That didn't go well. Nor did their bid to buy the Memphis Grizzlies, which ended with them losing $5 million of investors' money, Niemann says. The recession didn't do them any favors, either. In 2010, Laettner's attorney said that Laettner had $10 million in assets and $40 million in debt.

And now a new lawsuit filed in January pits Niemann—who, since 2005, has led the Durham Housing Authority—and Heinz against Laettner, Davis, Ghavami, and Britton. Niemann's version, as told in an affidavit, contains several tidbits about the breakup. Eventually, he says, creditors began to recognize the West Village for what it was: the only real asset Laettner and Davis had. So, needing cash, Davis, Laettner, and Niemann agreed in 2011 to sell the first phase. The following year, however, Davis, Laettner, and Britton voted to remove Niemann as manager of BDV III.

Then Laettner and Britton personally sued BDV III—their own company—over loans they claimed it hadn't paid back to them. Then, acting as BDV III's managers, they opted not to fight the lawsuit. Laettner won a $10 million judgment. Britton got $1.5 million.

As the lawsuit puts it: "The practical effect was to wipe out any chance of repayment of the capital accounts of BDV III ... and to insure that Laettner and Britton were paid more than what they were actually owed."

Niemann says in his affidavit that he was never contacted by BDV III's lawyer about BDV III's decision not to oppose the judgments for Laettner and Britton. "To my knowledge, a meeting of BDV III was never convened to consider granting multi-million-dollar consent judgments to other members/managers of BDV III," he says.

Niemann and Heinz's suit asks for a voiding of Laettner and Britton's judgments and a preliminary injunction on distribution of the money.

Laettner has other legal problems down in Florida. County records show his $4 million home outside Jacksonville was foreclosed on last year. Records also show his wife filed for divorce in August. Attempts to reach Laettner via his attorney were unsuccessful.

Last month, the entities that purchased the West Village from Blue Devil Ventures— Federal Capital Partners and Bell Partners— sold it to an Ohio firm for $187 million. With the commercial spaces at 100 percent occupancy and roughly 95 percent of the residential units leased year-round, the new owners are well positioned to make a mint. West Village is an undeniable success story in downtown Durham—just not for the people who dreamed it up.

This article appeared in print with the headline "Duking it out"

  • The West Village has been a tremendous success—except for the people who built it

Comments

Subscribe to this thread:

Add a comment

INDY Week publishes all kinds of comments, but we don't publish everything.

  • Comments that are not contributing to the conversation will be removed.
  • Comments that include ad hominem attacks will also be removed.
  • Please do not copy and paste the full text of a press release.

Permitted HTML:
  • To create paragraphs in your comment, type <p> at the start of a paragraph and </p> at the end of each paragraph.
  • To create bold text, type <b>bolded text</b> (please note the closing tag, </b>).
  • To create italicized text, type <i>italicized text</i> (please note the closing tag, </i>).
  • Proper web addresses will automatically become links.

Latest in Durham County



Twitter Activity

Most Recent Comments

I will never, ever live in another neighborhood that has an HOA. It's not even up for debate.
I already …

by mike_in_nc on Does North Carolina give homeowners associations too much power? (Durham County)

I would not buy or invest in a development that did not have an HOA. That after having made the …

by 669283 on Does North Carolina give homeowners associations too much power? (Durham County)

I've never lived in a house built more recently than 1976, so I have no personal experience with HOAs. I …

by David 1 on Does North Carolina give homeowners associations too much power? (Durham County)

Why any home buyer would voluntarily want another layer of bureaucratic control upon them, by buying into an HOA....just say …

by Michael Gary on Does North Carolina give homeowners associations too much power? (Durham County)

Comments

I will never, ever live in another neighborhood that has an HOA. It's not even up for debate.
I already …

by mike_in_nc on Does North Carolina give homeowners associations too much power? (Durham County)

I would not buy or invest in a development that did not have an HOA. That after having made the …

by 669283 on Does North Carolina give homeowners associations too much power? (Durham County)

Most Read

© 2016 Indy Week • 201 W. Main St., Suite 101, Durham, NC 27701 • phone 919-286-1972 • fax 919-286-4274
RSS Feeds | Powered by Foundation