East Coast Brokers trustee asks court to enforce settlement agreement

By Kali Hays

New York, March 6 – East Coast Brokers & Packers, Inc. trustee Gerard A. McHale Jr. is seeking court enforcement of a settlement with Professional Talent Group, LLC related to $2.5 million in estate funds put toward purchasing a “luxury home” in Tampa, Fla., according to a Thursday motion with the U.S. Bankruptcy Court for the Middle District of Florida.

The $2.5 million was transferred by Batista Madonia Jr. in 2011, and in January 2014, McHale filed a complaint against Professional Talent claiming that the purchase was a fraudulent transfer as the estate funds were used to purchase the property after it was already insolvent.

According to the complaint, Professional Talent contracted to purchase a home for $6.5 million in May 2011. In August 2011, East Coast transferred $2.5 million to a settlement agent in connection with the purchase.

McHale said the property is used or occupied by Professional Talent’s beneficial owner and Madonia Jr., but East Coast received little or no consideration in exchange for the transfer, which enabled Professional Talent to purchase the property.

Under a settlement agreement, Professional Talent and McHale will cooperate in the marketing and sale of the property and agreed that the property will not be sold for less than $5.2 million, unless both parties agree that a lower offer is in their best interest.

McHale will receive the first $400,000 in net proceeds from the sale and thereafter, the net proceeds will be split, with 75% going to Professional Talent and 25% going to McHale until the parties have received equal net proceeds, according to the motion.

McHale said that the terms of the agreement were mutually agreed upon in early January and counsel for Professional Talent confirmed the material terms of the agreement on Jan. 9.

However, since the agreement was confirmed, McHale said that he has been unable to get a signature from Professional Talent’s representative and is now forced to seek “judicial enforcement of the settlement agreement,” according to the motion.

Mulberry, Fla.-based former tomato grower-shipper East Coast Brokers & Packers filed bankruptcy on March 6, 2013 under Chapter 11 case number 13-02894.

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