Three high-profile Denver real estate brokers have opened yet another theater in their legal hostilities against the international firm they once worked for, even as a one-year injunction has come to an end and granted them the right to once again sell multifamily property in the city.
Terrance Hunt, Chris Cowan and Shane Ozment have spent more than a year locked in an interstate court battle over their decision last May to leave Newmark and join rival CBRE in apparent violation of non-compete clauses they signed with Newmark years before.
Throughout the saga, the brokers have lost more often than they have won, but received a respite Tuesday when a New York judge’s one-year injunction barring them from competing with Newmark in Colorado expired.
Through their attorney, Hunt, Cowan and Ozment declined to be interviewed Tuesday.
During their 14-month quarrel, the trio of brokers have sought, unsuccessfully so far, to pull several other brokers into the fracas. The New York judge rejected this maneuver in March, but the brokers are now trying a similar move in Denver District Court.
In a lawsuit filed July 7, Hunt, Cowan and Ozment harken back to 2014, when they were working at the brokerage firm ARA Colorado alongside their mentors: John “Jack” Box and Jeffrey Hawks. That year, ARA was sold to Newmark and ARA’s employees became Newmark’s. Included in the purchase agreement — which each of the men had to sign because they owned 1 percent of ARA — were two-year non-compete clauses.
Hunt, Cowan and Ozment claim those clauses were an act of treachery on the part of their mentors, who used the trio’s “freedom and livelihood as a bargaining chip to extract a higher sales price from Newmark and line their own pockets with millions of extra dollars.”
They are suing Box, Hawks, a Newmark employee named Kevin McCabe who allegedly talked them into signing the contracts, and two defunct companies that partly owned ARA Colorado. The lawsuit alleges fraudulent concealment and breaches of fiduciary duty by the defendants.
Hunt, Cowan and Ozment made many of those same allegations in March, when they asked Judge Barry Ostrager in New York to let them add their claims against ARA and its leaders to the ongoing Empire State case. Ostrager soundly rejected that motion a few weeks later.
“Defendants seek to make this claim,” the judge wrote of the three brokers, “notwithstanding the fact that they brazenly left plaintiffs’ employ, absconding with millions of dollars of plaintiffs’ business and good will after secretly negotiating a deal with plaintiffs’ biggest competitor.”
Requests for comment from Box and McCabe through their Newmark email addresses were not answered. An attempt to contact Hawks, who lives in Georgetown, was not successful.
When Hunt, Cowan and Ozment made similar allegations in the New York case, Newmark mocked the trio for suggesting “they are somehow the victims.” In reality, Newmark’s attorneys claimed, the three knew full well they were signing non-compete clauses. Claims to the contrary were a “lawyer-driven fiction” written in the “breathless, conspiratorial prose of a spy novel.”
“According to (the brokers), during this time (Box and Hawks) were villains secretly hatching a Machiavellian plot to trick them into signing onto non-competition obligations without their ever knowing it. If that were true, why would Jeff Hawks forward a draft agreement containing those very provisions” to them before they signed it, Newmark attorney Nirav Shah asked March 3.
In the Denver case, Hunt, Cowan and Ozment are represented by attorney Allison Kostecka with the national law firm Gibson, Dunn and Crutcher’s office in Denver.
“Our clients were left with no choice but to sue the defendants for deceiving and lying to them for personal financial gain,” said Reed Brodsky, a partner in Gibson, Dunn and Crutcher’s New York office.
He added, “As outlined in detail in the complaint, the defendants repeatedly told our clients that they had negotiated a good contract when, in reality, they talked in secret about how detrimental the terms were to our clients.”