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The Villages
Monday, September 27, 2021

Competition and loyalty take center stage at Properties of The Villages trial

Christopher Day

Ventura and Bobby Ann Claveria bought their home in 2008 in The Villages with Christopher Day of Properties of The Villages acting as their sales representative.

The couple, now in their mid-80s, recently sold their two-bedroom, two-bathroom home on the Historic Side of The Villages for $177,000. Once again, they turned to Day to represent them. The only difference is that this time, he was running his own real estate company, KD Premier Realty.

Chris Day Assisted Ventura And Bobby Ann Claveria With The Purchase Of Their Home In The Villages In 2008. They Recently Turned To Him When They Wanted To Sell Their Home.
Chris Day assisted Ventura and Bobby Ann Claveria with the purchase of their home In The Villages in 2008. They recently turned to Day when they wanted to sell their home.

The Claverias’ home was one of many on a spreadsheet presented in Tampa federal court on Wednesday by Todd Burns of Properties of The Villages. He was trying to show to Judge James Moody, who is presiding in a bench trial, the loss of commissions suffered by Properties of The Villages, since Day and his partner, Jason Kranz, abruptly departed Properties of The Villages on Dec. 16, 2019.

Burns tried to make the case that the Claverias had long been tracked in the AS400 computer system operated by Properties of The Villages. He reasoned that the commission from that sale should have gone to Properties of The Villages.

The amount of damages allegedly suffered by Properties of The Villages has yet to be spoken out loud so far in the trial, in which Day, Kranz and their associates are being sued by Properties of The Villages.

Jennifer Parr, vice president of sales for The Villages, was the first witness called in the case Monday and under cross-examination would not put a dollar amount on the damages suffered by Properties of The Villages due to KD Premier Realty’s venture into the marketplace.

“That would be very difficult to quantify,” she said.

In a trial brief, Properties of The Villages attorney John Lauro suggested the loss in commissions suffered by his client totals $1.12 million.

The spreadsheet presented in court had some eyebrow-raising entries.

In addition to the sale of the Claverias’ home, which appears to be motivated by a stronger loyalty to Day and a lost allegiance to Properties of The Villages, the attorney representing Day and Kranz pointed out that his clients’ own homes were counted on the spreadsheet as lost commissions.

“Do you honestly believe they would have wanted to sell their homes through Properties of The Villages after leaving the company?” attorney Jonathan Pollard asked Burns.

Pollard also pushed Burns on the value of the more than one million “leads” in the AS400 database. Pollard suggested that many of the “leads” have no more than a passing interest in The Villages. He got Burns to admit that many of the names in the database are no longer viable.

“Many have passed away. Or they are just looking and haven’t decided,” Burns said.

It was alleged in the second day of the trial that Day and Kranz took customer data from the AS400 before they left Properties of The Villages. Their attorney has argued some of the information they are alleged to have taken was easy to find in the phonebook.

He testified that Properties of The Villages sold 4,500 homes last year, about evenly split between new homes and pre-owned homes. He also said 53 percent of the sales were driven by new customers and 47 percent were repeat customers.

Top Properties of The Villages official feels threatened

Mike Berning

Longtime Properties of The Villages executive Mike Berning testified about the extensive training provided to sales representatives. He said the sales representatives’ independent contractor agreements and non-compete clauses are critical to the company’s viability. He said if representatives could receive the training and then walk out the door and sell against The Villages, it would be devastating.

“If that became an ongoing process, I don’t know how we would survive,” he testified.

Berning claimed that NextHome, the San Francisco company behind KD Premier Realty, has a “behemoth” technology platform that drove $6 billion in national sales in 2019.

Berning said NextHome has substantially more resources than Properties of The Villages.

He was asked if KD Premier Realty is competing fairly.

“They are taking our customers,” Berning said.

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