In the latest twist in a long-running legal feud, a bankruptcy trustee has filed suit against Charlotte entrepreneurs Dan and Sara Roselli, owners of the Packard Place startup hub, over tax bills paid by their former marketing company.
In 2012, Redf Marketing, owned by the Rosellis, filed for Chapter 11 bankruptcy protection after it was the subject of a $4.2 million legal judgment. Redf no longer exists, but the bankruptcy court case has continued on as the trustee liquidating the firm works to reclaim money for creditors.
In a legal volley this week, the trustee alleged in a lawsuit that Redf, before its bankruptcy, improperly paid the Rosellis’ personal tax bills in 2010 and 2011, making payments totaling about $704,000. Later, the complaint alleges, the Rosellis filed amended federal and state returns and received refunds of more than $650,000.
The suit, filed in federal bankruptcy court in Charlotte, says the Rosellis should return the tax refunds to the bankruptcy estate, so the money can be used to repay creditors. The suit also alleges that the couple has breached the court-approved bankruptcy plan by filing objections to various settlements in the case and engaging in “bad-faith litigation tactics.”
Brad Pearce, a Charlotte attorney representing the Rosellis, said the couple intends to defend the case to “the utmost of their ability.”
“We think the charges are meritless, and we’re frankly surprised at the liquidating agent’s conduct,” Pearce said.
The suit comes a month after a bankruptcy court judge from the Middle District of North Carolina, Benjamin Kahn, was appointed to hold a settlement conference in the case.
Since its purchase by the Rosellis in 2010, Packard Place, a former car dealership known for its distinctive white-and-black paint scheme, has become a fixture on Charlotte’s startup scene, housing business incubators and co-working space.
The entrepreneurial hub became a player in the Redf bankruptcy case last year when the trustee alleged in court documents that the Rosellis improperly transferred $1.3 million from Redf in order to buy the building. In an effort to recoup money for creditors, the trustee filed suit against the entities that sold the Packard Place building to the Rosellis. Those legal actions resulted in a settlement, and the case was closed in January, according to court documents.