Deadwood Bust: Redwood Trust Nightclub Deal Goes to the Courts

By Van Smith

Published by City Paper, Apr. 28, 2004

The past year has been a tumultuous one for Nicholas Argyros Piscatelli, the real-estate investor and developer who’s spent millions since 1999 turning a historic downtown bank building into a high-end nightclub called Redwood Trust. In April 2003, in a crime that is still unsolved, the club’s manager and one of its regular patrons were gunned down execution-style in the manager’s rented Fells Point rowhouse. Then, in May, the 54-year-old Piscatelli was convicted of drunken driving and barred for 24 years from getting behind the wheel with any amount of alcohol in his system. In June, he filed plans with the city liquor board to sell the nightclub business to one of the club’s DJs for $350,000, but that deal fell through without explanation from either Piscatelli or the DJ, Leonard Kern.

Another buyer emerged in August 2003: Omar Haughton, a 20-year-old from Ellicott City, who slapped down $200,000 in cash toward the total (and greatly inflated) price tag of $1,145,000, signed a promissory note for the balance, and renamed the club the Mint. The transaction rapidly soured and is now in the courts, with Piscatelli and Haughton suing one another amid accusations of conspiracies, lies, and coercion with threats of armed violence.

Piscatelli’s company, Redwood Trust LLC, sued first. On Jan. 7, it asked the Baltimore City Circuit Court to order Haughton and his company, Trustville LLC, to pay Redwood $1,100,495–the sum of the unpaid balance for the purchase of the club, plus late charges and litigation costs. The next day, the court granted the order.

But a month later, on Feb. 9, Haughton asked the court to vacate the order, arguing that the promissory note he signed was superseded by another one for $75,000 that Piscatelli signed in November 2003. In fact, Haughton contended through his attorney, Mike Henderson, that both notes were “obtained by fraud” and should be voided, allowing Haughton and his company to defend themselves in court–and also to countersue.

In mid February, Piscatelli’s attorney, Scott Tinney, responded to Haughton’s claim by alleging that the $75,000 note “was signed under duress in that Mr. Haughton forced Nicholas Piscatelli . . . to sign . . . with at least three armed individuals present.”

Attached to Tinney’s response was an affidavit from Piscatelli.

“On November 20, 2003, at the request of Omar Haughton, Paul Chrzanowski [Piscatelli’s partner in Redwood Trust] and I went to the Redwood Trust to discuss the now past due note payment” owed by Haughton’s company to Piscatelli, the affidavit states. It continues to describe how, after Piscatelli and Chrzanowski took seats in Haughton’s office, “at least three masked individuals with guns entered the room and stood behind Mr. Chrzanowski and me. Mr. Haughton stated that I was now going to sign new documents for what he deemed the club to be really worth.”

Piscatelli’s affidavit says that the reason he signed the $75,000 note was because he “believed that if I did not sign . . . I would be subjected to bodily harm.”

The alleged incident was committed to a police report, which was not submitted in the court case but was obtained from the Baltimore Police Department by City Paper. It reflects that the events in question took place on Nov. 25, not on Nov. 20 as Piscatelli stated in his affidavit. At that time, according to the police report, Piscatelli told police that Haughton and three masked men–one with a 10-inch-by-4-inch knife, one with a semiautomatic handgun, and one with “cocaine in a paper towel”–threatened him and Chrzanowski with the weapons while asking them to sample the drugs. Piscatelli told the police he signed the new note when they “made a threat to kill” him, adding that they proceeded to take $500 cash and his Maryland driver’s license out of his wallet before sending him and Chrzanowski on their way.

“Omar [Haughton] says the police report is false,” Henderson said in a recent interview with City Paper. “The whole thing was a conspiracy to get Omar in [as the business owner], relieve him of his money, then kick him out. And that’s how it stands.”

Haughton’s company was evicted from the Redwood Trust property over the winter, and its assets were sold to Piscatelli’s company at an April 7 auction.

“Piscatelli now has $200,000 of Omar’s money and his club back,” Henderson notes.

Neither Tinney nor Piscatelli returned messages left at their offices for this article.

Haughton’s claim of fraud was sufficient for the court, which vacated its earlier judgment against him. Now, he is countersuing over the matter. On April 20, Haughton and Trustville filed suit alleging that Piscatelli, Chrzanowski, and their lawyer, Melvin Kodenski, conspired to keep Haughton in the dark about the club’s revenues, duping him into purchasing it at “a greatly inflated price.” According to the complaint, they then held Haughton to a promissory note and rent obligations “they knew could not be paid from operation of the business”–although they told him otherwise–with the ultimate goal of taking Haughton’s $200,000 deposit and “regaining the business and the premises.” Haughton seeks to recover approximately $350,000 from Piscatelli and his co-conspirators, plus $2 million in punitive damages from Piscatelli, Redwood Trust LLC, and Kodenski.

Haughton also claims damages of $2 million arising from the police reports about the masked men filed by Piscatelli and Chrzanowski, reports that Haughton contends they knew to be false.

“A search warrant was executed [and] no weapons or contraband were found,” the complaint asserts, adding that Haughton “subsequently met with the police and the State’s Attorney to respond to the allegations. No charges have been or are expected to be filed.”

Finally, Haughton seeks $350,000 and another $2 million in punitive damages from Kodenski for legal malpractice. The complaint alleges that Kodenski represented both Piscatelli and Haughton in the nightclub transaction but failed to provide meaningful “care and diligence in handling the purchase” on behalf of Haughton. Kodenski did not return messages left at his office for comment.

Henderson expects to take the case to a jury trial, which has been scheduled for next April.