Nesenoff & Miltenberg: Former Keller Williams Realty CEO Cleared of False Sexual Misconduct Accusations
Former Keller Williams Realty Chief Executive Officer John Davis says the recantation of false sexual misconduct allegations against him by a Keller Williams franchise owner strengthens his racketeering, antitrust and embezzlement case against the residential real estate giant, its founder, its former president and other executives ? who knew the allegations were fabricated and weaponized them against Davis.
Franchisee Inga Dow made false sexual harassment claims against Davis as part of her own lawsuit against Keller Williams, her attempt to gain financial leverage in her own dealings with the company. She subsequently received an undisclosed settlement from Keller Williams, and after being confronted with evidence that she fabricated her claims against Davis, Dow dropped her malicious allegations against Davis and issued an apology.
"In the lawsuit, I made statements about Mr. Davis that wrongly accused him of misconduct including harassment, sexual assault, and rape," Dow said in her affidavit, filed in late November. "I fully retract these statements and apologize to Mr. Davis."
Davis is suing Keller Williams Realty, founder Gary Keller, ex-Keller Williams president Josh Team, and multiple co-defendants in U.S. District Court for the Western District of Texas, accusing them of inflating key financial metrics including company sales and profits to convince individuals to purchase Keller Williams franchises, known as regions and market centers. It also alleges Gary Keller masterminded an "illegal and criminal-minded scheme," where he and the other defendants misrepresented franchise agreements, forced franchisees to pay for services through companies that Keller owns or invests in, and retaliated against franchisees that don't agree to the scheme ? and similar activity continues to this day.
"Now that my accuser's false allegations have been put to rest, I'm seeking accountability and justice ? not just for myself, but for other business owners who have suffered at the hands of Gary Keller and Josh Team's schemes and lies," Davis said. "We need to stop Gary Keller and his cronies from further destroying people's livelihoods and reputations."
After a successful two-decade career at Keller Williams that culminated in his serving as its CEO, Davis resigned in January 2019 after clashing with Keller over Keller's business strategy that would diminish the profit from the individually owned and operated Keller Williams offices.
"I had told Gary Keller to stop his shenanigans, so he was petrified when I resigned," Davis said. "He subsequently turned the full Keller Williams machine against me because he was afraid to face me on the field of competition."
In response to Davis's resignation, Keller and Team disparaged him and withheld their knowledge of Dow's false accusations against him as he was negotiating the sale of his Keller Williams regions as part of his separation from the company. This manipulation devalued Davis's holdings and resulted in tens of millions of dollars in financial losses, according to Davis.
"Further, we can prove that Keller Williams knew Dow's allegations against me, which she made in an ill-conceived effort to gain bargaining leverage against Keller Williams, were false," Davis said. "But instead of defending me, Gary Keller and company threw me under the bus and went along with a knowingly bogus narrative that I'd done these terrible things."
As part of his case against Dow, Davis discovered a far-reaching conspiracy led by Keller, in which Keller Williams executives were using their power and platform to severely damage the businesses and reputations of KW franchise owners so they could seize the equity in their businesses and amass more power.
"Investors and franchisees are seeing the facts that we've laid out in our lawsuit and saying, ?This also has happened to me,'" said Davis's lawyer Andrew Miltenberg, a partner at Nesenoff & Miltenberg. "Gary Keller's trying to capture all the franchises by locking owners into deals they can't get out of and then either seizing these independently operated businesses or buying them back at a steep discount so he can control them like they were part of one big company, contrary to the franchise model."
The coverup related to the false sexual misconduct allegations is just one of a long list of actions by Gary Keller and Keller Williams executives that have harmed Davis and numerous franchise owners. Dow's withdrawal of her fabricated claims is long-awaited vindication for Davis, who says he now can focus on the racketeering lawsuit that he hopes will hold his former colleagues accountable and halt their plan to enrich themselves at the expense of Keller Williams franchise owners.
"I've been financially and reputationally diminished for standing up and pushing back against Gary Keller," Davis said. "In addition to regaining what I've lost, my goal is to make sure no one else is harmed."
About Nesenoff & Miltenberg
Founded in 1992, Nesenoff & Miltenberg is a firm of New York, Boston and Palo Alto litigation, appellate, and transactional attorneys who are proud to offer clients the legal services, resources, and staffing to meet their needs and achieve their goals.
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