In The News
- Pressure Mounts on Developer Saunders
By Shelby Sebens
Shelby.Sebens@StarNewsOnline.comPublished: Sunday, February 7, 2010 at 3:30 a.m.As a local developer tries to assure his property owners that his business is legit, the complaints and lawsuits against him continue to pile up.
Two lawsuits have been filed against The Coastal Companies, parent company to large Brunswick County developments such as Seawatch at Sunset Harbor and Ocean Ridge Plantation. And the local district attorney as well as the state Attorney General's Office are reviewing property owners' complaints.
Mark Saunders, chief executive officer of The Coastal Companies, sent an e-mail to all property owners Thursday stating a lawsuit filed in December is groundless.
The same day, the Hodges and Coxe law firm in Wilmington filed a second lawsuit against the developer, this one on behalf of 38 property owners in Seawatch and a section of Ocean Ridge. The lawyers plan to file another suit on behalf of 40 property owners in Ocean Isle Palms, said Sarah Reamer, of Hodges and Coxe.
The lawsuits accuse Saunders and The Coastal Companies of misrepresentation, racketeering and obtaining property by false pretenses, stemming from their failure to complete necessary infrastructure, promised amenities or both.
Saunders' e-mail message says media coverage of the first lawsuit might have caused property owners to question their trust in the company. It includes a list of bullet points, stating the company will defend the lawsuit and that “anyone can file a lawsuit with defamatory charges.” It also has a link to a feedback form where property owners can submit comments.
It also warns property owners of a “concerted campaign” to solicit people to join the lawsuit.
Company spokeswoman Nita Hill said the e-mail was an effort to improve communication with property owners and tell Saunders' side of the story.
“Mark and The Coastal Companies is not above realizing that things might need to be improved,” she said.
Reamer said the law office received a copy of the e-mail.
“We generally disagree with the contents on it, obviously, and we've gotten additional calls because of it,” she said.
Meanwhile, District Attorney Rex Gore is reviewing complaints his office has received and is trying to decide how his office might proceed.
He did not know how long the review process would take and wouldn't comment further on the complaints.
The attorney general's consumer protection division has received at least 12 lengthy complaints similar to the allegations made in the lawsuits. The office is reviewing the complaints, attorney general's spokeswoman Noelle Talley said via e-mail.
According to the Department of Justice's Web site, consumer complaints can be handled in several different ways. The attorney general's office could do anything from recommending the person filing the complaint consult a private attorney to referring the complaint to another agency to taking legal action if there are illegal business practices.
Hodges and Coxe has 213 clients who have purchased property in one of The Coastal Companies developments, Reamer said. The first lawsuit was filed in December on behalf of property owners in a phase of Ocean Ridge. That suit has been moved to N.C. Business Court because of its complexity. The others will probably be moved as well.
But if it goes to trial, Reamer said, it would be held in Brunswick County.
Two conflicting views
In addition to property owners who have taken legal action, others have implored state, county and federal agencies to intervene.
Bud Cass, who owns two lots in Seawatch, said he is part of a group of more than 170 property owners who say they have been defrauded, and he agrees with complaints in the Ocean Ridge suit.
“What they describe is exactly what we in Seawatch went through as well,” he said.
Cass said he and others are becoming frustrated with Gore's office for not taking any action. He said he contacted the office in June and was told he would have an update by November.
“Nobody gets a call back. Nobody gets an e-mail. The guy's not doing anything,” he said.
But Gore said he cannot comment or answer the property owners' questions other than to acknowledge he has received the complaints and is reviewing the lawsuit.
Not everyone is unhappy with Saunders and The Coastal Companies, however.
Ed Griffin, of Princeton, N.J., has a house in an unfinished section of Ocean Ridge. He said he is happy with the company and plans to eventually move down to the area.
He said he understands the housing market fluctuates and blames the economy for the slowdown, not the developer.
“If anybody was foolish, it was me to build right then,” he said.
Griffin and his wife decided to stay in New Jersey a little longer to keep working, but they hope the market will pick back up so they can move to Brunswick County.
Griffin said the lawsuits and negative publicity, however, could hurt the chances for a rebound.
His house is currently being used by The Coastal Companies as a model for prospective buyers.
Cass, who is also from New Jersey and had planned to retire here, said he wants the company to make good on its promise and finish the needed infrastructure so he can put his property on the market.
“We're not moving to North Carolina because we got screwed,” he said.
Shelby Sebens: 343-2076
On Twitter.com: @ShelbySebens
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- Date Posted: February 8, 2010