Feuding Partners Trade Lawsuits and Charges
WHITE PLAINS, N.Y. -- The partners who acquired nearly 90 Shell Oil Co. gas stations in Westchester County and metropolitan New York last year are embroiled in a lawsuit in which both sides have traded charges and countercharges alleging the theft of more than $1 million in gasoline revenue death threats and false criminal complaints, illegal hirings and firings, gross mismanagement, a "scorched-earth" attempt by its day-to-day operator to ruin and devalue the company, dealer price and rent manipulations, "predatory pricing" that undercut and angered some Shell dealers, and libel and slander.
According to a report by the Westchester County Business Journal, the partners and their attorneys have made numerous legal filings in New York State Supreme Court since June, approximately a year after the Thornwood, N.Y.-based company's $43.3 million acquisition of the Shell gas stations from Shell's gas-station subsidiary, Motiva Enterprises LLC.
The bitter legal battle pits Sammy Eljamal, owner of Wholesale Fuels in Thornwood, against several business partners with whom in 2009 he formed two limited liability companies, NY Fuel Holdings and Metro NY Dealer Stations, in order to acquire, lease and distribute fuel to 88 Shell-branded stations in Westchester County, New York City and Long Island.
In addition to the Shell venture, Eljamal has interests in several other service stations in the region, the news outlet reported.
According to the report, Eljamal, Leon Silverman, chairman of Silverman Realty Group in White Plains, N.Y., and James A. Weil, a Scarsdale, N.Y.-based investor, agreed to co-manage the business, with Weil as the venture's financial chief and the industry-experienced Eljamal running day-to-day operations. There are three passive investors in the company, the Westchester Business Journal report noted.
However, the business relationship soon soured as -- according to the report -- Eljamal's partners grew disillusioned with his performance and accused him of stealing more than a $1 million from gas-pump sales. Less than one year after their purchase closed, the partners notified Eljamal that they were offering to sell all of the Shell properties for $25 million to a buyer who also would assume all company debt, and in June, they told Eljamal that he would be removed as a company manager.
Eljamal obtained a temporary court order barring his removal and keeping him in control of day-to-day decisions at the company, even though Weil must first sign off on any decisions regarding financial matters. The business partners in June were issued a gag order by Supreme Court Justice William Giacomo.
In late August, Eljamal reportedly returned to state Supreme Court seeking hundreds of millions of dollars in damages from Weil for libel and slander, claiming his business partner's "campaign of lies" has driven away Eljamal's fuel-supply customers and contractors and employees, and has damaged his ability to obtain financing for his business, he claimed.
Neither Silverman nor his business partners would comment when contacted by the Business Journal, and Eljamal did not return a call for comment.