The case is a part of a long-running authorized battle between Davis, an ex-CEO of Keller Williams, and his former employer. An earlier case Davis filed towards KW was additionally ordered into arbitration.
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A protracted-running authorized battle between Keller Williams and a former CEO of the corporate, John Davis, has inched nearer to a conclusion after a decide this month despatched the case to arbitration.
John Davis
The transfer is a response to a request from Keller Williams and different defendants to both dismiss the case, or compel arbitration. The decide refused to dismiss, however granted the latter request in an Aug. 12 order. The plaintiffs within the case, together with Davis, additionally consented to arbitration, the order reveals.
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Information of the order was first reported by RISMedia. The case is being adjudicated in U.S. District Court docket for the Northern District of Texas, Fort Price Division.
In a press release to Inman, Keller Williams spokesperson Darryl Frost stated the corporate “is pleased with the court’s decision to compel arbitration in this matter, which is precisely the outcome we sought and expected.”
“While our motion to dismiss was a procedural alternative, the court’s decision to, yet again, enforce a binding arbitration provision is supported by the law and reflects the strength of our position,” Frost continued. “It is unfortunate that judicial resources, as well as our own time and resources, were wasted to enforce what should have been a straightforward legal process. We are fully prepared to defend these baseless claims in arbitration.”
In the meantime, Davis’ attorneys Andrew Miltenberg and Kristen Mohr stated in a press release to Inman that “we are pleased that the court agreed with us that these claims should move forward in a forum where Keller Williams, Gary Keller, John Keller, Marc King, Josh Team, and their various entities have to answer for their wrongdoing, which has harmed many business owners within the Keller Williams ecosystem.”
The case is the second of two lawsuits Davis has filed towards his former employer. The primary started in 2022 in what Davis characterised as an effort to revive his repute after sexual misconduct allegations towards him surfaced earlier that 12 months. Along with Keller Williams, Davis named as defendants Gary Keller, former KW President Josh Workforce, and Inga Dow — the CEO of varied KW places of work and the one that made the misconduct allegations.
Dow ultimately dismissed her claims towards Davis.
A decide despatched Davis’ preliminary lawsuit to arbitration in March 2023.
Nonetheless, in November of final 12 months he filed a second swimsuit. The second lawsuit reiterated a few of the similar claims, together with that Keller Williams engaged in a “fraudulent, illegal business scheme” and that it inflated key profitability metrics. Nevertheless it additionally made further allegations, together with accusing Gary Keller of amassing charges from firm franchisees and utilizing these charges for himself, amongst different issues.
For its half, Keller Williams advised Inman on the time the second swimsuit was filed that the claims have been “baseless” and an try to “smear Keller Williams in the press under the guise of a lawsuit.” Keller Williams and different defendants additionally requested the courtroom to carry Davis in contempt for avoiding arbitration, and claimed the second swimsuit was merely a repackaged model of the primary swimsuit.
This month’s new order, nonetheless, states that “Davis responded that the different mix of parties and claims in the second lawsuit did not violate the arbitration order.”
‘The second lawsuit features a new plaintiff, Jesse Herfel (“Herfel”), and varied new defendants,” the order states. “It also involves new theories of liability based on civil RICO, Sherman Act violations, embezzlement, and general partner liability.”
Keller Williams and the opposite defendants requested that the case both be dismissed or pressured into arbitration in April. After a sequence of subsequent requests and authorized filings, the decide finally granted the arbitration request this month.
Along with sending the case to arbitration, the decide denied the defendants’ request to recoup some lawyer’s charges. Nonetheless, the decide additionally warned the plaintiffs that they might finally find yourself on the hook for his or her opponents’ authorized payments.
“To be sure, the court is acutely aware of what seem to be delay tactics and a waste of resources in two separate matters,” the decide wrote within the order. “The most recent effort appears to be plaintiffs’ request for an extension of time to amend pleadings and add parties after consenting to arbitrate all claims. Should plaintiffs continue to act in such a manner, defendants may reassert their request for attorneys’ fees in connection with the first lawsuit and/or the second lawsuits.”
Learn the decide’s Aug. 12 order right here (if the doc doesn’t seem, attempt refreshing the web page):
Replace: This submit was up to date after publication with further particulars from the lawsuit, and with commentary from the varied events concerned within the case.
