A-Rod Faces Punitive Damages Over Real Estate Venture With Ex-In-Law

New York Yankees great Alex ”A-Rod” Rodriguez is facing punitive damage claims stemming from a six-year legal battle with his ex-brother-in-law over a national multifamily partnership that went awry.

Constantine Scurtis claimed Rodriguez—who was married to Scurtis’ sister, Cynthia Scurtis, from 2002 to 2008—pushed him out of their real estate venture, denying Scurtis profits he claimed were due.

Rodriguez, who maintains the allegations are based on assertions Scurtis knows to be false, filed a counterclaim saying Scurtis took money out of their partnership without authorization.

Miami-Dade, Florida Circuit Judge Maria de Jesus Santovenia agreed last month to allow the complaint to be amended to add the punitive damage claims to the complaint.

Santovenia concluded in her May 20 order that Scurtis’ motion provided a “reasonable showing” to support the punitive damage claims. The request will be added to existing counts of continuing breach of fiduciary duty, conversion and breach of fiduciary duties.

Scurtis’ attorney Gonzalo Dorta touted the order as a win for his client against a heavy hitter in the sports world.

“Celebrities are not above the law and must account for their egregious behavior,” said Dorta, partner at Dorta Law in Coral Gables, Florida.

He represents Scurtis with Joel Denaro of the Law Office of Joel Denaro, Vincent Duffy of the Law Office of Vincent J. Duffy and Asela Lopez, all based in Miami.

Rodriguez’s attorney, John C. Lukacs Sr. in Coral Gables, did not immediately respond to a request for comment.

Scurtis, who sued in 2014 and filed a third amended complaint in 2019, claimed he and Rodriguez started their apartment acquisition and resale venture a couple years after they met through Cynthia Scurtis.

The partnership agreement generally was that Rodriguez, a real estate novice, would contribute the capital and would be a 95% owner and beneficiary of profits, according to the complaint. Scurtis would be a 5% recipient and owner in exchange for the input of his real estate and financial expertise. Scurtis also was entitled to a 3% acquisition fee. Over time their percentage stakes in the venture deviated some but not significantly, according to the complaint.

The venture owned and operated over $1 billion worth of property and managed about 5,000 units, Scurtis said in court filings. They formed a limited liability partnership for each property with 26 companies formed from 2003 to 2005 and another 20 from 2005 to 2008.

Scurtis alleged Rodriguez started cutting him out of the venture and profits he was due by replacing Scurtis’ name on some of the LLCs and other companies created to run their venture.

Scurtis was shortchanged when Rodriguez convinced him to defer the 3% acquisition fee so the funds could be used as liquidity for their partnership, according to the complaint. Scurtis alleged he was owed $8 million in acquisition fees alone by the time the third amended complaint was filed.

In a response, Lukacs called the allegations a sham based on false facts, maintaining Scurtis willingly transferred his membership interest in some of the LLCs and wasn’t forced out of the companies as he claimed.

Scurtis withdrew nearly $1.4 million from the partnership in 2004 and 2005 on brokerage-type fees and real estate deals without any authorization, Lukacs wrote in a counterclaim filed last September.

The two agreed the funds would be treated as a loan that Scurtis would repay from future profits on property sales, according to the counterclaim. Although Scurtis accepted reduced payments, he still owes over $1.3 million.

The counterclaim lists money lent, unjust enrichment and abuse of process counts.

Both sides are seeking a jury trial.

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