Fresh & Easy Real Estate Director Making Empty Threats
I just had to post this. I just closed a Fresh & Easy ground lease that was purchased by Fresh & Easy on 12/31/09. Earlier today, we sent out an email blast announcing the sale of the property. I received the following email (with his attorney cc’d as well) from UK transplant Tom Scorer, Real Estate Director for Fresh & Easy at 3:25 PM this afternoon:
Chris,
I have received your email blast directly and from many other sources.
The executed PSA contains a confidentiality clause, which clearly prohibits the publication of any details of the deal without our express permission, which was not sought and is not given. See below the relevant extract from the agreement:
Please be advised that your publication breaches the recorded agreement. We are considering the action we will take.
Kind regards
Tom
Tom Scorer
fresh & easy Neighborhood Market Inc.
Real Estate Director
310-867-0418
———— Disclaimer ————–
This is a confidential email.
Fresh and Easy may monitor and record all emails. The views expressed in
this email are those of the sender and not Fresh and Easy. Fresh & Easy
Neighborhood Market, Inc. 2120 Park Place, El Segundo, CA 90245
Naturally, I could not resist responding to such foolishness. Here is the email I sent back to the bloke:
Tom,
This is one of the most ridiculous emails I have received in my career. Your claim is a joke and without merit. I don’t really think I need to explain why but I will do so anyway.
You (on behalf of Fresh & Easy) went out of your way to circumvent my involvement in this transaction, specifically refusing to include language in the purchase and sale agreement protecting my position and specifically refusing to have brokerage representation in the purchase. As a result of your efforts, I am not a party to your purchase and sale agreement and am therefore not bound by its terms.
The property was marketed for sale for well over 1 year prior to your purchase. The terms of your lease agreement are widely known. The date, purchase price and identity of the purchaser are public knowledge. If you take a moment to read the language of your PSA that you so kindly provided to me you may notice that particular phrase stating "to the extent reasonably practical." I would think that information that resides in the public domain would fall outside of this clause, don’t you?
Lastly, I would think that any claim you may attempt to make would need to be based upon actual damages. Do you have actual damages? You may want to brush up on your US law. Your attorney is a very good one. You should consult him before sending out emails like this again in the future.
At this point it seems like you may just be wasting your company’s cash on unnecessary legal fees. Maybe I should copy your superiors in the UK. I’m sure they would love to hear how you are spending your time these days.
Thanks for the new blog content. I haven’t written a post in quite some time. This one should be up shortly.
Cheerio!
Chris
P.S. – As a point of clarification, I did not consult any person or entity which was directly involved in this transaction in preparing my email. I did not, nor am I required to, seek approval from anyone prior to sending the announcement.
Tom, instead of threatening brokers with lawsuits, why don’t you focus your attention on opening stores that actually attract customers? Don’t you think that might be more productive and beneficial to the bottom line? Just a thought.
For the record, the property was a ground lease. The leased fee interest (land) was purchased by Fresh & Easy on 12/31/09 for $2,650,000 which was equivalent to an 8.49% CAP rate on the in-place ground rent of $225,000 / year NNN. If you are a seller negotiating with Fresh & Easy to sell them your property I would think this would be a pretty good comp for you to reference when they submit their 9.50% CAP offers.
I love citizen journalism.
Burn bridges much?
Me or him?
What a tool.
hahahaaha. i love this stuff!
So I take it you represented the seller? As a broker, you may not be a party to the transaction, but the seller is. Still not much merit if everything is public as you indicate, but could be a headache nonetheless. Even if it goes anywhere, they will have trouble with proving damages unless they can show that the seller told you (as their agent I presume) AND that your email blast caused Fresh & Easy to have to buy another ground lease at a 8.49% cap instead of the 9.5% that they otherwise could have had you not sent out the blast.
That sounds like a lot more effort than it's worth.
The seller did not tell me anything. He did not need to. I was the procuring cause and knew the agreed upon price and as you noted above, this information is public knowledge anyway. I don't agree that publishing one comp can create damages either. If that were the case, CoStar would be sued into oblivion.
CoStar wouldn't be on the hook, the person or firm who told CoStar would be if they were bound to keep the deal confidential. This is why you never want to sign an agreement with a NDA which relies on you to make sure your agent or representatives keep their mouth shut. That's just unnecessary risk. If the party really wants somebody to stay quiet, they should get a separate agreement from that person.
Agree totally. As for my CoStar comment, I would reference several recent (and pending) cases where websites are being held accountable for content published by their users.
….you might get an email tomorrow about disclosing his email since the footer says it is confidential
He can't unilaterally bind me to any sort of confidentiality.
i was joking
[...] really need governance of minimum aptitude levels in the CRE industry. First Fresh & Easy’s real estate director and now this guy. This is getting [...]
you're my hero
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Simply Amazing! Love his [Toms'] analysis on the transaction. Missed his calling…CONGRESS!!
Oh, ok. I should have realized.