By DAVID SKOLNICK

Staff writer

YOUNGSTOWN — In a counterclaim to stop a foreclosure on its property by MS Consultants Inc., the Chill-Can property owners contend they were the victims of a criminal corruption enterprise by MS as well as two felons — a former MS official and ex-Youngstown Finance Director David Bozanich.

An MS Consultants attorney strongly disputed the filing in Mahoning County Common Pleas Court — calling it “defamatory” and “without any factual nexus.”

MS Consultants won a $322,908 breach of contract default judgment on March 20 against M.J. Joseph Development Corp., the Chill-Can’s parent company. M.J. Joseph appealed to the 7th District Court of Appeals, which rejected it June 30 for being untimely as it was one day after the 30-day deadline to file an appeal.

But it turned out an error by the Mahoning County Clerk of Courts put the wrong time stamp on the appeal and it was filed timely.

Judge Maureen Sweeney filed a two-sentence judgment on Wednesday correcting the time stamp. M.J. Joseph plans to seek reinstatement of the appeal with the 7th District.

MS filed a foreclosure complaint July 12 to force the sale of the largely undeveloped property that was to be the cornerstone of the city’s lower East Side revival to pay the debt.

In the counterclaim, Justin Markota, an M.J. attorney, wrote that MS breached the contract, including failing to appropriately coordinate the design of the construction project and properly advise the company about engineering deficiencies.

BRIBERY SCHEME

The counterclaim also states Bozanich, when he was Youngstown finance director, requested M.J. Joseph use MS.

Bozanich and Raymond Briya, MS’s former chief financial officer, were sentenced Sept. 3, 2020, after being convicted of felonies for a bribery scheme.

Among Bozanich’s convictions are a felony count of bribery and a misdemeanor count of unlawful compensation of a public official for accepting free rounds of golf from Briya so MS “could secure work for or within the city of Youngstown, then devised a scheme to hide the benefits,” according to an indictment. Bozanich served almost 11 months of a one-year prison sentence.

Briya was found guilty of five felonies, including attempted bribery and obstructing justice, for his involvement and was sentenced to 180 days of house arrest.

In the court filing, Markota included MS as a co-conspirator.

But prosecutors have said MS had no knowledge of the Briya-Bozanich scheme and Briya illegally took about $200,000 from the company.

M.J. Joseph “is entitled to compensation for the damages incurred as a result of (MS’s) pattern of corrupt activity,” Markota wrote.

‘AN UNCIVIL DIATRIBE’

In response, Luther L. Liggett Jr., MS’ attorney, wrote M.J. Joseph’s “defamatory nature changes this civil case into an uncivil diatribe without any specificity. Joseph Development made no effort to file such baseless claims in the original action since originally filed on Jan. 6, 2023. Certainly, such a defamatory pleading should be dismissed when not made in good faith without any factual nexus between these parties.”

Liggett also wrote that M.J. Joseph’s “unsubstantiated allegations that MS Consultants engaged in criminal activity ‘constitutes defamation per se as it may import an indictable criminal offense involving moral turpitude.'”

M.J. Joseph’s countersuit “recites numerous allegations touching on (corruption), but without any relation or reference to Joseph Development,” Liggett wrote. “Defendant merely offers the tautological conclusion that the company ‘has suffered significant financial harm'” in excess of $1.5 million.

Liggett points out that M.J. Joseph voluntarily entered into a contract with MS and “does not offer any factual nexus between the alleged (corruption) violations” and its “statement of damages.”

Magistrate Dominic J. DeLaurentis Jr. scheduled an Oct. 11 meeting on M.J. Joseph’s counterclaim.

BREACH OF CONTRACT

In the Jan. 6 lawsuit, MS listed five claims against M.J. Joseph, including two counts of breach of contract for paying $291,921 on a $614,829 bill.

M.J. Joseph was to make its final payment to MS on Oct. 5, 2018, and failed to do so, according to that lawsuit.

M.J. Joseph signed a contract with MS on Dec. 21, 2016, for design services for its proposed Chill-Can plant in Youngstown, according to the lawsuit.

Liggett has said if the foreclosure is granted, the sale of the Chill-Can property also would allow the city of Youngstown to get the $1.5 million it was given in a judgment entry against M.J. Joseph. The city is suing M.J. Joseph for breach of contract.

Magistrate Dennis J. Sarisky also awarded $733,480.80 in sanctions against the company to the city in a July 20 ruling. He pointed to multiple failures by the company to comply with court orders.

The sanctioned amount of $733,480.80 by the city is $414,948.09 it spent on acquiring 15 properties bought for the project, which also included relocation expenses, and $318,532.71 in demolition and abatement costs.

Markota objected to Sarisky’s decision — and has asked Sweeney to remove the magistrate from the city-M.J. Joseph case. She has not ruled on the request.

The $18.8 million proposed project broke ground in November 2016 and was supposed to be in full operation by 2018 to produce the world’s only self-chilling beverage can.

There are three unfinished buildings on the 21-acre site.

dskolnick@vindy.com