Key facts
- MV Realty is suing Holland & Knight for $1.2 billion, alleging malpractice.
- The brokerage claims the law firm's legal advice exposed it to consumer protection litigation and investigations.
- MV Realty's business, valued at $350 million in December 2022, was allegedly destroyed by the firm's actions.
- Numerous states have filed suits or opened investigations into MV Realty's homeowner benefit agreements.
- The lawsuit seeks damages between $300 million and $1.2 billion.
Florida-based MV Realty has filed a $1.2 billion malpractice lawsuit against the law firm Holland & Knight, alleging that the firm's legal advice and services led to significant consumer protection litigation and investigations, ultimately destroying the brokerage's business.
The complaint, filed in Miami state court, states that Holland & Knight's work "destroyed" MV Realty, which was valued at $350 million as of December 2022. MV Realty's legal troubles stem from its homeowner benefit agreement (HBA) program, which offered homeowners cash in exchange for using MV Realty as their exclusive broker. State attorneys general have alleged that MV Realty concealed the terms of these contracts, which can last up to 40 years.
According to the lawsuit, 16 states have filed suits concerning the HBA program, and 30 have opened investigations. MV Realty has reached settlements with several states, including California, Massachusetts, Pennsylvania, and Nevada, since March. Maryland Attorney General Anthony Brown also filed charges against the brokerage in late May.
MV Realty blames Holland & Knight for failing to provide the necessary expertise to protect the company from consumer protection laws. The brokerage claims the law firm's alleged malpractice resulted in catastrophic consequences, including $156 million in investments made based on H&K's guidance, an equity sale at a $320 million valuation, and $20 million in defense costs.
The brokerage is seeking damages between $300 million and $1.2 billion from Holland & Knight and three of its Miami-based attorneys. MV Realty previously filed for Chapter 11 bankruptcy protection in 2023, but the case was dismissed by the U.S. Bankruptcy Court for the Southern District of Florida in May 2024.