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YOUNGSTOWN -- With the owners of the stalled Chill-Can plant property refusing to participate in a breach-of-contract lawsuit filed by Youngstown, the magistrate in the case says the proceedings are essentially over.
After M.J. Joseph Development Corp., which owns the property on the city's lower East Side, again didn't show up or appoint an attorney at a Thursday hearing, Magistrate Dennis J. Sarisky of Mahoning County Common Pleas Court said, "There's nothing left to decide except if the city will seek court and attorney fees. Except for that, there's nothing left to do with this case."
Lou D'Apolito, the city's deputy law director, said the city won't seek those fees because M.J. Joseph has no intention of paying them.
The city will now focus on a foreclosure case in an effort to obtain the 21 acres owned by the company, D'Apolito said. That lawsuit was filed by MS Consultants Inc., which won a $322,908 breach of contract case Feb. 20 against M.J. Joseph for unpaid architectural fees when the latter stopped defending itself in court.
M.J. Joseph is ignoring the foreclosure case.
"We're going to file one more judgment entry" in the breach of contract case to "make sure everyone understands the amount we're owed and where we stand in line with other judgments and that should wrap up everything," D'Apolito said.
MS filed the foreclosure case July 12 to seize M.J. Joseph's property after winning a lower court case on the breach-of-contract lawsuit. There are six other parties in the foreclosure lawsuit with an interest in the property including the city.
"The focus will be on the foreclosure of the property," D'Apolito said. "We'll attempt to get back the property. It's a convoluted process with so many parties involved. We have land and property in Youngstown we'll attempt to get back."
Judge Maureen Sweeney upheld two decisions by Sarisky that M.J. Joseph owes the city $1.5 million in water and wastewater grants and a $733,481 sanction -- $414,948 the city spent on acquiring 15 properties bought for the failed project, which included relocation expenses, and $318,533 in demolition and abatement costs.
Asked if the city will be able to collect the $2.2 million owed by M.J. Joseph, D'Apolito said, "I don't."
That's why, he said, the city isn't going to bother seeking attorney fees and court costs.
"We'll never get them," D'Apolito said.
Efforts to reach Mitchell Joseph, the head of M.J. Joseph and affiliated companies, have been unsuccessful. The companies don't exist on anything but paper.
Joseph, a former Youngstown resident, claimed when the supposed project broke ground in November 2016 that it would cost about $18.8 million and be in full operation by 2018 to produce the world's only self-chilling beverage can.
M.J. Joseph was required under the agreement with the city to construct four buildings and create 237 jobs by Aug. 31, 2021.
Three unfinished building are at the fenced-in, undeveloped site.
The city filed a $2.8 million breach of contract lawsuit June 17, 2021, contending M.J. Joseph failed to live up to its promises to develop the site. In a March 29, 2021, certified letter, the city informed Joseph he had 60 days to construct a number of buildings and hire about 150 workers or it would file a lawsuit. He failed to do so.
Knowing the city's lawsuit was coming, M.J. Joseph and Joseph Manufacturing Co. Inc. filed a May 24, 2021, lawsuit against the city to stop it from reclaiming the $1.5 million in grants. That suit also contends the city doesn't have any legal rights to money, property and buildings.
In addition to the grant and the property and demolition / abatement costs, the city's lawsuit contended it had lost at least $575,000 in income tax revenue from the project's failure at the time of the court filing. That lawsuit said the "full amount of lost income tax revenue will be proven at trial," but the city was losing about $18,333 a month. At that rate, the city would have lost about $600,000 in additional income tax revenue.
But the city is not pursuing that part of the lawsuit anymore.
Brian Kopp and Justin Markota, who were M.J. Joseph's attorneys since the start of legal action against the company, requested Sept. 11 in three different lawsuits that they be permitted to withdraw from the cases, likely over nonpayment of fees.
Since then, M.J. Joseph has ignored all filings in its court cases.
A Franklin County Common Pleas Court judge ruled Nov. 29 that the companies and Joseph owed $2.58 million to Richard A. Briskey, a Sunbury businessman, in a breach-of-contract lawsuit. Briskey won the case by default when the companies and Joseph never responded to the lawsuit. Briskey is now a party in the foreclosure lawsuit.