Bosshardt Realty to pay nearly $1.5M to former associates now battling criminal charges

An arbitrator is ordering Bosshardt Realty Services to pay near $1.5 million in a case involving unpaid commissions to two of its former commercial real estate brokers who are facing felony charges theft of “trade secrets” from their former employer.

Both sides are claiming victory in the ruling by arbitrator Melvia B. Green, which was issued on Wednesday.

Ron Koslowski, a criminal defense lawyer for the real estate associates Daniel Drotos and Michael Ryals, said the ruling in the civil case will bolster their criminal defense, where the men are charged with racketeering, scheme to defraud/organized fraud and theft of trade secrets. Drotos faces an additional charge of offense against intellectual property.

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“Some of those same arguments (in the civil matter) carry over to the criminal case,” Koslowski said Thursday. “I really hope that the state is going to take a hard look at what the arbitrator said, and how the arbitrator viewed the evidence and that that helps them make a decision about exactly how to move forward with this case.”

Ryals and Drotos ran "The Drotos Ryals Group," a high-volume commercial real estate division under Bosshardt Realty Services, before going to Colliers International in April 2019.

Both men have been in an extended civil legal battle with Bosshardt Realty over unpaid commissions from their time at the company.

Drotos and Ryals also have a pending slander suit against Aaron Bosshardt, owner of the company, saying he made false statements to the police that resulted in their criminal charges. They are also entangled in a federal probe involving the Alachua County school district where the men have been accused of inflating the price of land, which they deny.

On Feb. 2, State Attorney Brian Kramer filed the felony charges in circuit court against Drotos, Collier’s senior director, and Ryals, a senior company advisor.

Paul Donnelly, a lawyer for Bosshardt, said Thursday that the arbitrator's ruling was focused on real estate commissions, and disagreed that the issue will impact the criminal case.

“The prosecutor is looking at information that the arbitrator refused to consider and could not consider on a breach of contract claim," Donnelly said.

Still, the $1.48 million Drotos and Ryals were awarded is still significantly less than what they wanted.

The agents sought 80% of back commissions for their roles in property sales. Some of those properties, however, were closed on once they began working for Colliers. The arbitrator's ruling was based on a 50% split of that owed amount.

Bosshardt Realty must pay the men $810,310 in unpaid real estate commissions, which includes interest, through March 31 of this year.

The order also orders that Bosshardt pay $522,841 in attorneys fees, with the remaining funds Bosshardt is ordered to pay covering administrative and arbitration fees.

Donnelly also said that Bosshardt tried to make four payments to Drotos and Ryals for the 50 percent commission payment originally, an offer the men rejected.

Wednesday's ruling, he says, basically reflects the money Bosshardt has been attempting to pay.

"The arbitrator, in this case, has agreed with Bosshardt and disagreed with Ryals and Drotos on that point," Donnelly said. “The case was a breach of contract claim by Ryals and Drotos. They claimed they were owed 80% (commissions), not 50%.”

There is also debate about whether the ruling will stand.

“The arbitration award is not anything final until a court approves it,” he said. “And we do have serious doubts the court would approve this award.”

Arbitrator Green also ruled against Bosshardt’s claims that former employees owed him money for breach of contract, noting in her ruling that "none of these alleged breaches by the claims were substantial by the credible competent evidence at the final hearing."

Green said Bosshardt’s claim that Ryals and Drotos breached their agreements by copying or pirating Bosshardt's confidential files was “unsubstantiated" and that the two men didn't secretly compete with Bosshardt while still employed by the company.

Green also states in her ruling that Ryals and Drotos did not surreptitiously try to divert a contract from Bosshardt to Colliers International to handle the real estate work for the Alachua County School Board.

"It is found, however, that the credible competent record evidence failed to substantiate this allegation," Green said in her ruling.

This article originally appeared on The Gainesville Sun: Bosshardt ordered to pay nearly $1.5M to former agents Drotos, Ryals