Prominent developers lose $20 million lawsuit

Developer Hugh Culverhouse Jr. has long maintained fellow developers and prominent Sarasota businessmen, Henry Rodriguez and Randy Benderson, cut him out of a lucrative mixed-use project through backroom conversations and political machinations.  

A six-person Sarasota County jury, after a two-week trial that ended Monday, now agrees with Culverhouse. 

The jury awarded Culverhouse $20 million in damages in the lawsuit. The suit was over a failed mixed-used project on 1,000 acres in south Sarasota County. Plans for the project, announced in 2010, called for nearly 2,000 homes and more than 1.5 million square feet of retail, office and commercial space. Sarasota County was also involved in the project because it was being assembled in an Energy Economic Zone, a state-run pilot program designed to discourage urban sprawl and encourage energy-efficient land use. 

Rodriguez and Benderson plan to appeal the decision, and they denied any wrongdoing in the case. “There is a lot more to go on this,” Sarasota attorney Morgan Bentley, who represents Rodriguez, told the Business Observer.  

In a statement emailed to reporters Monday, Benderson Development General Counsel David Baldauf says the firm was disappointed the decision.

“There are a number of legal issues yet to be determined by the court and we are hopeful that most, if not all, will be resolved in our favor,” Baldauf wrote. 

The chief allegations in the lawsuit: Culverhouse claims Benderson and Rodriguez conspired to destroy the project when they realized certain elements of it had changed or were no longer in their favor. The project initially was split three ways: Rodriguez, who has developed both residential and commercial properties in Sarasota, was going to oversee the homebuilding; Benderson, with University Park-based Benderson development, one of the largest retail developers in Florida, was in charge of retail and office space; and Culverhouse, who owns Palmer Ranch in south Sarasota County, was going to develop manufacturing, warehouse and some retail and commercial space. 

One key allegation, according to court records, was Culverhouse accused Benderson of sabotaging the project with Sarasota County officials because of the split in retail space. Culverhouse, in the trial and court records, says Benderson thought Culverhouse had too large a share of potential retail space. Culverhouse claims Benderson threatened to pull his share of the project out and oppose it publicly if Culverhouse didn’t scale back his commercial and retail space. 

Culverhouse alleges Rodriguez worked with county officials, through emails and public statements, to scuttle the project when problems came to light on zoning rights. The six counts in the Culverhouse lawsuit the jury deliberated on include breach of contract, breach of fiduciary duty and fraud. Culverhouse’s attorney, Steven Hutton, couldn’t be reached for comment Tuesday.