HOUSTON, Feb. 23, 2023 - Jeff Diamant of Jeff Diamant, P.C., as lead counsel, and co-counsel Robert Burford of Burford Perry and Shawn Johnson, of SAJPLLC, prevailed this week in winning a jury verdict totaling $155 million in damages in a complex fraud and breach of fiduciary duty lawsuit on behalf of Laura Yosowitz and Greenlet, LLC.
On February 21, after a two-week trial, jurors in Harris County's 334th District Court found in favor of Ms. Yosowitz against her ex-husband, Martin Kay, CEO and majority shareholder of Entera, a "leading real estate technology company" that is funded by private equity investors like Bullpen, Craft, and Goldman Sachs. According to its website and evidence at the trial, Entera facilitates institutional investment in single family homes using big data and its artificial intelligence platform. It claims to have enabled transactions on 14,000+ single family homes valued at $4.6 billion across 29 US markets.
As part of the couple's 2016 divorce agreement, Mr. Kay agreed to raise capital and commercialize Greenlet's software platform and associated real estate brokerage business. Greenlet had by then serviced six of the nine largest institutional single family home investors in the country, including Invitation Homes, Colony Capital, and 643 Capital. Ms. Yosowitz argued that instead of building Greenlet, Mr. Kay used its funds, software code, data, customers, developers, business plan, and prospective investors for his newly formed company, which later changed its name to Entera.
The jury found that Ms. Yosowitz was a member of Greenlet, that Martin Kay owes Greenlet $138 million for his breach of fiduciary duty to the company, and that Mr. Kay is liable to Ms. Yosowitz, individually, for more than $17 million total associated with claims for breach of fiduciary duty, fraud, and breach of contracts.
At its heart, this lawsuit is about Mr. Kay's misuse of his control over Greenlet's ownership and usurpation of a business opportunity, said Mr. Burford, lead counsel to Ms. Yosowitz.
Members of both firms developed and tried this case, led by Diamant and Burford, also included name partner Brent Perry and associate Zachary Carlson
The case is Laura Elizabeth Yosowitz v. Martin Lee Kay, et al., No. 2018-37750 in 334th District Court. Judge Dawn Rogers presided at the trial. A transcript of the reading of the verdict is available here. The actual verdict form will be available as soon as it is imaged by the Court on this post.
