The 5,000-acre Wohali property, located approximately five minutes west of Coalville and Echo Reservoir, is intended to serve as the pinnacle of luxury real estate. Interested homebuyers can select semi-custom units of varying sizes, floor plans and architectural styles while enjoying views of the largely undeveloped private valley, including 3,400 acres of backcountry trails.
But behind the scenes, the community promising to help property owners imagine their “perfect living experience without compromise” is embroiled in legal troubles.
Thomas Cottone, a founding member of Wohali Builders, the development company spearheading construction efforts, filed two separate lawsuits against the company and two key executives earlier this year. In addition to financial mismanagement allegations, Cottone claimed the executives engaged in coordinated retaliation efforts to defame him and remove him from his position on the board after he attempted to voice concerns and re-establish oversight through further financial controls.
The two cases are ongoing, but a third lawsuit filed by a different party last month shines further light on the company’s reported monetary struggles.
Court documents filed on June 20 claim Wohali Builders hired Knight Trucking, a transportation services company with a terminal in Salt Lake City, to haul materials to and from the construction site between Jan. 10 and May 28 of this year. However, Wohali Builders allegedly failed to pay for the services, which totaled approximately $119,255.
The lawsuit additionally alleges Wohali was paid by a third-party service for the work Knight Trucking performed, but the development company “failed” to pay despite having the money in hand. The complaint then accuses Wohali Builders of outright refusing to pay the bill.
“Wohali would be unjustly enriched if not required to pay the fair and reasonable value of Knight’s transportation and hauling services, together with interest at the statutory rate … costs and attorney fees,” court documents say.
Attorneys representing Wohali Builders have not yet filed a response in court, and there are currently no hearings set.
Wohali Village is a multi-million dollar project in eastern Summit County. John Kaiser and Matthew Galioto, two executives and members of Wohali’s board of managers, have been working to bring their vision of the luxury housing community to reality for the past eight years.
The two men were named as defendants in Cottone’s litigation, which claimed Kaiser and Galioto accused Cottone of misconduct “in a series of emails, meetings and calls with the project’s investors” after Cottone encouraged the development company to agree to an audit, improve financial controls and provide transparency regarding business transactions.
Cottone said his reputation was “irreparably tarnished” as a result, and he was subsequently removed from his leadership position with the project.
Throughout the lawsuit, he also alleged that Kaiser has a history of fraud connected to similar development projects across the country, including a 2015 civil case in Arizona in which Kaiser was ordered by a judge to pay defrauded investors $515,000.
In 2013, Kaiser testified against his former business partner, who was ultimately convicted of defrauding investors in New York. The criminal case was Kaiser’s introduction to Galioto, an FBI investigator who worked the case and used him as a source and witness.
“On information and belief, it is highly irregular and against standard practice for a law enforcement officer and his former source — in a complex fraud action involving real estate developments — to enter into a substantial business relationship, also involving a development project, with a key witness,” the lawsuit said.
Cottone became involved with the project in 2017. He grew the investor pool to 65 members and $25 million in contributions, as well as securing a $79 million loan, before he voiced concerns about financial mismanagement in late 2022. He was then ousted from the company and the project in retaliation for becoming a whistleblower, Cottone’s lawsuit alleged.
“Cottone would later learn that months before Kaiser shut him out, he also tried to inhibit Cottone’s ability to maintain the required checks and balances — and justify his own obstruction — by initiating a smear campaign against Cottone amongst Wohali Builders employees, generally accusing Cottone of being a bad guy who was untrustworthy and committing nefarious and potentially ‘illegal’ acts,” the complaint said.
Cottone asked for a total of $195 million in damages — $65 million for each claim of defamation, invasion of privacy and interference with Cottone’s economic relations — as well as attorneys’ fees.
The libel lawsuit involving Kaiser and Galioto has a motion hearing scheduled for 2 p.m. on Nov. 18. The civil case naming Wohali Builders as a defendant does not have any scheduled dates in court as of Tuesday morning.