There have been rumors of political corruption in Everett, MA for years. The mayor, Carlo DeMaria has, for the moment, overcome claims of sexual harassment, ties to associates of organized crime and a federal investigation concerning strong-arm tactics used in awarding contracts to builders in the city. Now there is a new claim that could add to the city's woes, Everett's wrongful taking of a building.
The City of Everett Massachusetts, just outside of Boston, is currently in the middle of a resurgence as a result of a $2.5 billion casino being built by Wynn Resorts that is scheduled to open in June 2019. The Massachusetts Gaming Commission (MGC) is set to make an announcement later this month as to whether Wynn is even suitable to hold a gaming license as a result of an extensive investigation into sexual harassment claims against the company's co-founder, Steve Wynn.
On April 22, 2009, Daryl Shaimus pulled to the curb of 50 Liberty Street (Everett, MA) a dated but well kept Mansard Victorian style home that had been subdivided from its earlier grandeur into eight small apartments. The tenants, mostly working class people looking for inexpensive housing, were thankful to be near Boston without having to pay the high rents the city is known for. Shaimus was a tenant of the building and lived there for over 20 years.
As he got out of his car, Shaimus walked by two large trucks loaded with plywood from Action, an emergency services company known throughout Boston for covering the entrances and windows of abandoned and badly burned buildings. Workers, welding drills and nail guns, pulled sheets of plywood from the truck drawing people into the streets to see the spectacle. Shaimus saw his fellow neighbors with armfuls of their belongings with a stunned look on their faces. As he got closer to the building he saw his landlord, James Ryan, sitting on the porch with his head in his hands. Ryan looked up, "They're taking the building, you'll need to get your stuff out and find a place to stay."
At the time, Ryan did not have a cell phone but used a voicemail service. He routinely called in from his home or a payphone (remember those?) and check for messages. He had just returned from a trip to Cape Cod and listened to a message from his security monitoring service; a fire alarm had gone off at 50 Liberty. When he arrived he saw no fire truck, no smoke, no water spewing from hoses, and no fire. As he approached an Everett fire inspector, Ryan said, "Everyday without a fire is a good day," to which the firefighter responded, "wait till you see who is inside." As Ryan entered his building he saw Michael Desmond, an Everett building inspector, who turned around saying, "Remember me." Desmond handed Ryan multiple papers indicating violations for blocked exits, abandoned tires in the basement and five illegal apartments. Ryan was baffled as to why a building inspector would have responded to a fire alarm at 50 Liberty ... was this a set up? The official reason listed on the Everett Fire Department Incident Report was "NO REASON FOR ALARM SOUNDING." Ryan believed that there was more to it.
Ryan's family purchased 50 Liberty in 1959 and obtained permits from the City of Everett to divide the large single family home into eight apartment units. Ryan owned a few other homes in Everett and had also converted those into apartments. It was a business model that allowed him to enjoy a steady cash flow from reliable tenants, many of whom stayed in his units for decades.
Ryan had previously entertained an offer of $500,000 just a few years before from Jamie Russo, a close friend of Mayor DeMaria's and a guy who had a felony record for his role in using forged or stolen credit cards to get cash at Foxwoods Casino during the 1990s. Russo was known for bragging around Everett that once Mayor DeMaria was elected that he would soon be buying up real estate across the area. When Ryan turned down the offer, he believed that Russo, well connected in the DeMaria administration, felt spurned by the rejection, making life as a landlord more difficult. Over the years Ryan had a contentious relationship with building inspectors Desmond and Kevin Curry (has since left City of Everett), both of whom cited Ryan for minor violations ranging from missing barrel lids on trash cans to a small, two-inch squirrel hole in a barn behind one of his properties ... thus Desmond's comment on the day the fire alarm went off, "remember me."
Jerome V. Sweeney II, a local attorney who represented Ryan from approximately 1978 through the 1990s, helped Ryan through a number of court appearances. Sweeney told me in an interview that Ryan believed that the city inspectors were pressuring him for payments in exchange for fewer citations. In one instance, Sweeney recounted an incident where he represented Ryan in a case concerning missing barrel lids at one of his properties. While Ryan remedied the situation, inspectors Curry and Desmond requested that Ryan be summoned before a Malden District Court. The judge asked if the lids had been replaced, they had, and the case was over. According to Sweeney, inspector Curry approached the desk in the courtroom and said that Sweeney's rental property, located in Everett, looked like it needed an inspection for missing barrel lids. Curry walked away but Ryan overheard the comment. It was there that Ryan said that he did not want Sweeney to become the focus of harassment by Desmond and Curry. Ryan politely told Sweeney that he was dismissed. Ryan then hired Even Gellar ... but the violations kept coming.
According to sworn testimony, Ryan claims that Everett Building Inspectors Desmond and Curry implied that extortion payments would allow for more lenient treatment on violations. When it came to yet another violation, this one for a two-inch squirrel hole at the top of a garage gable, Ryan asked for a bench trial in Middlesex County court, a matter more aptly handled outside of the court. Prior to the trial, Ryan claims that Curry told him, "Ryan, it doesn't have to be like this, you know?" When Ryan asked what that meant, Curry replied, "Well, you know what that means." A jury was about to be seated when Ryan asked Gellar if he could approach both Curry and Desmond who were just outside the courtroom. There Ryan confronted the men and said that he intended to state in open court that the two had sought to extort him. After the confrontation, Desmond entered the courtroom and whispered into the ear of then Everett City Solicitor Robert Jordan who then came over to Gellar saying, "we're dismissing the case." The squirrel hole remained and Ryan's run-ins with city inspectors dropped off until the incident in April 2009.
Massachusetts laws provide a reasonable timeframe for an apartment owner to remedy violations without having to toss tenants into the street. In Ryan's 20 years of being an owner/landlord, he had never experienced, nor heard of, an immediate evacuation and board-up of apartments as a result of inspection violations. Most of Ryan's issues could have been fixed within a few hours on site, with the exception of the "5 illegal apartments." What is curious about the "illegal apartment" violation was that there are existing permits in Everett City Hall for the construction of all 8 units, there were a number of inspections of the building over the years and the proximity of Ryan's apartment building to the Buidling Inspectors office at Everett City Hall (Two blocks away). If the apartments were "illegal" there were plenty of opportunities for the City of Everett to handle it prior to 2009.
With the tenants gone, his health failing (he had by-pass surgery just a few years prior) and no rental income, Ryan fell behind on the building's mortgage. Despite believing that Everett had no grounds to take his property, Ryan determined that his best option was to sell the property "under duress." He needed to dump the property to pay the mortgage at a time when real estate prices across the country were plummeting due to the financial crisis.
It would not be until October 15, 2009, 6 months after the incident, that there was a court hearing regarding the board-up. A week before the October 15 hearing, Ryan got a call from his real estate broker that went to voicemail, "I am with the City Solicitor and an agent from the AG's (Attorney General) Office at City Hall. They said that if you don't take an offer that has been made to purchase the property by 4pm, the city would knock the house down next week." Ryan, disbelieving the message, did not call the broker back until the following week and explained that he would not entertain any offers until after the court hearing. He then called the Massachusetts Attorney General's Office to report what he believed was corruption involving Everett. Ryan would spend over 2 hours on the phone with the Attorney General's office explaining what had occurred.
The MA Attorney General's office has an office dedicated to serving cities in the state to find owners of abandoned, dilapidated properties. It's aptly called, the Abandoned Housing Initiative (AHI), and according to its website it gets tips for its investigations by "municipalities sharing the addresses of abandoned residential properties with the Attorney General's Office. The AGO then uses its investigatory tools to identify the delinquent owner." The City of Everett had reported Ryan's 50 Liberty to AHI as abandoned and unable to contact the owner despite the fact that a court date had been set where both Ryan and the city were to appear.
Ryan spoke to agents Matthew Verge and Greg Dekermenjian from AHI (both have since left AHI) and assured them that the property was not abandoned. The two agents had no record or information on the scheduled court proceeding nor had they received any additional information from Everett. Had anyone at AHI gone by 50 Liberty, they would have at least seen a ReMax for-sale sign with a phone number on the facade of the building. All they had to do was call and they would have soon found James P. Ryan.
On October 15, 2009, Melissa Murphy (then Everett City Solicitor, now Town Manager of Sudbury, MA) represented the City of Everett in Everett v James P. Ryan in Malden District Court (MA). Prior to the hearing, Murphy requested a meeting with Ryan and his attorney, Gellar. The discussions in that meeting led all to believe that Everett should not have taken Ryan's property but Murphy insisted that some of the violations were valid. In return for paying a fine of $5,000, to be paid once the property was sold, Ryan would get his property back. Murphy informed the judge that the charges against Ryan were going to be dropped and that a verbal agreement had been made ... the judge granted a continuance until April 12, 2010. Despite numerous requests from Gellar, no agreement ever emerged from Murphy and 50 Liberty sat vacant.
By April 12, 2010, still with no agreement and a year after the inspectors shuttered the building, the City of Everett defaulted on the Malden District Court case against Ryan and it was dismissed. Ryan, still unable to make payments on the mortgage, said that there were numerous offers for the property but the city had restricted access to the property, making it almost impossible for potential buyers to view it. In June 2010 the bank holding Ryan's mortgage, U.S. Bank National Association, took ownership of the property. In one last ditch effort to sell the house to someone he knew, Ryan reached out to Anto Santiauri, a former land owner in Everett, and told him of the bank's purchase and encouraged him to make an offer on the property. Santiauri offered $219,000. The bank rejected the offer and instead took one for $69,000 less from Greg Antonelli, a close acquaintance of Everett Mayor DeMaria.
Ryan was determined to expose what had happened to him. In addition to speaking with the MA Attorney General's Office, he visited the Middlesex County Assistant District Attorney Warren Lee and John Verner, who specialized in public corruption. After an in-person meeting, submission of a large volume of documents and placing multiple phone calls, Lee spoke with Ryan and said that his office had determined that "there was no corruption in Everett." He needed to move on.
On April 20, 2011, Ryan hired attorney Frederick Hayes who sent a demand letter to Everett Mayor DeMaria asking for $500,000 in damages as a result of losing 50 Liberty. Mayor DeMaria never responded and after a year's wait, Ryan filed a lawsuit against the City of Everett in Middlesex County Court. To Ryan's surprise, he later received a letter from Middlesex stating that the City of Everett never responded and a judgement for $500,000 was entered in his favor. Ryan, for a moment, believed that he had won something ... but that was short-lived.
The City of Everett received a copy of the same notice indicating they owed Ryan money for seizing his property. They knew someone had dropped the ball and hired the law firm Kopelman & Paige, specifically Jonathan Silverstein. Silverstein was no stranger to Everett, his firm handled other cases and represented Everett in its host agreement for the casino with Wynn Resorts that resulted in a $30 million payment commitment. Silverstein called Hayes and requested that Ryan vacate the default because the file on the case had been "lost." Ryan acquiesced after being told by his attorney that if he did not agree to vacate, the judge would likely allow one. Ryan would be going back to court.
In discussions with Silverstein, Ryan's attorney received an offer to settle for $35,000. Ryan was outraged but his attorney insisted that it was a good offer and added that if City of Everett employees acted on their own to maliciously harm Ryan then the city would have no responsibility ... Ryan would get nothing.
Not wanting to settle, but not wanting to seem like there was no counter offer, Ryan had an idea. He told his attorney that he would take the $35,000 if, and a big IF, Mayor DeMaria signed the agreement and also noted that "The City of Everett stole Ryan's property and caused its sale to Greg Antonelli." His attorney made the request and it was rebuffed. A settlement offer by Ryan's attorney, not named here, was agreed to without Ryan's permission. Ryan has never received any settlement from his attorney nor the City of Everett.
The case is complicated and Ryan has done his best to explain it. Since the beginning of this debacle, Ryan has reached out to government organizations to look into his claims of corruption. He is confident that he can prove that Everett wrongly took his property but his mission is to expose corruption in the system. He believes that there are others who have been harmed in Everett. Ryan has an appeal into Malden District Court that will be heard later this year.
Since state authorities have ignored Ryan's information, he sought another outlet with the Massachusetts Gaming Commission. Because Everett is a host city in agreement with Wynn Resorts, Ryan hoped that he could take his concerns to the MGC. He made contact with MGC Investigations and Enforcement Bureau investigator, Massachusetts State Trooper James Morris. Ryan provided numerous pieces of documentation including his court filings. To Ryan's knowledge, no action was taken by Morris causing Ryan to escalate his concerns to executives at MGC.
At 6:30am on May 25, 2018, Ryan called Karen Wells, Director of Investigations and Enforcement Bureau and also head of the investigation into Wynn's suitability. Wells picked up on the first ring. Ryan, himself caught off guard by the pick-up, told Wells that he had a matter that he was trying to have someone investigate regarding "corruption in Everett and links to organized crime." Wells assured him that she would have someone look into it and would listen to previous voicemails that Ryan had left with MGC. Nobody called Ryan back. He then called MGC Commissioners Gayle Cameron and Edward R. Bedrosian, Jr. ... no answer. The lone call that was returned was from Trooper Morris who told Ryan to "not call the commissioners."
Tom Philbin, City of Everett Director of Communications, responded to questions that I sent directly to building inspector Michael Desmond, "Because of the pending litigation, the City of Everett will not be commenting on the case." Former Everett City Solicitor Murphy responded similarly. I spoke with Trooper Morris about the Ryan case and he would not confirm whether or not Ryan's accusations had made it to a case file for investigation. Morris referred me to the director of communications at MGC. An email to MGC's John S. Ziemba went unanswered.
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https://www.forbes.com/sites/walterpavlo/2018/09/18/wynn-casino-has-its-legal-problems-massachusetts-host-city-everett-has-some-too/
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Sunday, October 7, 2018
