From left: Tredway’s Will Blodgett and Fairstead’s Jeff Goldberg (Ariel, Getty)
Affordable housing giant Fairstead launched another lawsuit last week against its co-founder-turned-competitor Will Blodgett.
Fairstead calls Blodgett’s new firm, Tredway, a “copycat company” built on stolen information. The firm accuses Blodgett and his associates of lifting Fairstead contacts, data, deal leads and models in 2020 and 2021 as they geared up to start their own shop.
At the time of the filing, Fairstead and Blodgett were already suing each other over many of the same claims levied in the new suit. However, this suit levels new allegations about the acrimonious divorce, including a billion-dollar deal gone bad.
Fairstead alleges that Blodgett and co-conspirators raided its servers, downloading thousands of documents onto flash drives and laptops. Blodgett had said the downloads were part of his regular work for Fairstead before leaving to start Tredway, but the new suit alleges they exceeded authorized access. On a single day in May 2021, for example, one of Blodgett’s associates allegedly downloaded 8,730 documents.
Fairstead also claims Tredway’s founding employees stole models that Fairstead uses to price deals, estimate revenues, evaluate tax credits and debt options, and gain competitive advantage with rates and prices. Together, all this gives Tredway a “decade-plus head start,” the suit alleges.
The data is critical to Tredway’s ability to compete in the competitive affordable housing space, the suit claims.
“While Blodgett has deep family connections — he is married into the Tisch family, half-owners of the New York Giants and owners of a massive multibillion-dollar nationwide real estate portfolio — he lacks the financial acumen to operate or compete at the level which [Fairstead executives] operate,” the complaint reads.
Blodgett is not named as a defendant, but is the subject of many of the suit’s claims.
Fairstead argues that Tredway’s alleged misdeeds jeopardized its chance to buy a billion-dollar-plus affordable housing portfolio in November 2021, a deal it calls “the largest sale in its industry for years, if not a decade.”
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The deal was allegedly marketed through a broker with whom Blodgett had a close relationship. Fairstead accuses Blodgett of hiding it from the firm to save it for Tredway. The lawsuit notes that Blodgett officially founded the firm on Nov. 3, 2021, and less than two weeks later he and two partners bid for the portfolio, backed by over $1 billion in financing.
“Put simply, it is not plausible,” the suit reads. Fairstead still won the deal, but it claims Tredway’s bid drove up the price.
If the case goes to trial, Tredway would likely argue that the portfolio’s availability was hardly a secret and was in fact widely marketed.
Fairstead did not identify the properties, but another bidder told TRD it was the Foundation Portfolio, with 7,000 units across 17 states. The sale was brokered by Goldman Sachs and Andy Daitch of Marcus & Millichap, one of the biggest Section 8 brokers in the country, the source said.
Other claims are sprinkled throughout the suit. Tredway allegedly tried to peel away Fairstead’s head of construction, even though it had no construction projects on the horizon, potentially triggering personal guarantees by Fairstead CEO Jeff Goldberg and controlling stockholder Stuart Feldman.
Fairstead is seeking millions in damages, a permanent injunction against Tredway and to put any real estate it bought with help from Fairstead’s data into a “constructive trust,” which is used when someone illegitimately gains title to a property.
A spokesperson for Blodgett called the allegations rubbish.
“This is the latest desperate attempt by Fairstead to harass and malign Will since he decided to leave the company,” the spokesperson said. “Such malicious behavior and disregard for the truth is one of the reasons why Will separated himself from Stuart Feldman and Jeff Goldberg in the first place.”
The statement added that Blodgett and his new firm “are focused on building a company that lives up to its values.”
A representative for Fairstead did not respond to requests for comment.
The dispute between Fairstead and Blodgett started in August, when Blodgett accused his former partners of denying him tens of millions of dollars he was due from past Fairstead deals.
“I rope-a-doped you, Will. I fucking rope-a-doped you,” Goldberg told Blodgett, according to the latter’s lawsuit. Fairstead, in turn, claimed Blodgett threatened to go “torched earth” on the firm.