Daniel J. Flynn III is known around his hometown of Quincy as a successful businessman and a popular emcee at charity fundraisers and the city’s St. Patrick’s Day luncheon.
Across New England, he has been immersed in the real estate market for nearly three decades as CEO of Daniel J. Flynn & Co., which auctioned off thousands of distressed properties on behalf of lenders during the foreclosure crisis.
But in his other role as a real estate investor, Flynn has had a recent series of adverse legal judgments. Since March, eight default judgments topping $6.1 million have been handed down against Flynn in Norfolk Superior Court, several of them arising out of disputes with former real estate partners. The list of well-heeled plaintiffs includes Quincy construction company Lee Kennedy Co. and a Duxbury hedge fund manager.
“These people he’s taken advantage of are sophisticated people,” said attorney Lawrence Mayo of Norwell, who represents a Watertown man who won a $250,000 judgment against Flynn on May 15. “They’re not dummies and it’s really shocking to believe that people who you would perceive as educated persons would be so taken by his charm and character.”
Mayo said he has written to Norfolk County District Attorney Michael Morrissey asking for criminal prosecution of Flynn.
“We’re trying to look out for the general public and say, ‘There’s this guy out here who’s everybody’s friend, but he’s ripping them off,’” Mayo said.
Michael Connolly, a spokesman for Morrissey, said office policy is not to confirm or deny investigations.
Emalie Gainey, spokeswoman for Attorney General Martha Coakley’s office, also could not confirm or deny an investigation.
Flynn did not meet deadlines to contest the lawsuits, which resulted in default judgments. He said his attorney, Michael Hanley of Quincy, has been unable to work due to health problems.
“Some matters that he was in the process of resolving amicably have been delayed as a direct result of his illness. My firm is currently working swiftly to resolve any outstanding matters,” Flynn said in a written statement issued by public relations firm Regan Communications.
Contacted for comment on this story, Flynn agreed to an interview on Aug. 8 at the offices of Regan. He canceled the meeting at the last minute, citing a family medical emergency, and subsequently had Regan issue the written statement on his behalf.
The largest single judgment of $2.8 million was awarded in May in favor of a group of investors in DJF Real Estate Opportunity Fund, which Flynn co-founded in January 2008 with Duxbury hedge fund manager Alec Petro. Petro is a portfolio manager at North Peak Asset Management in Duxbury and taught last semester as an adjunct professor of finance at Boston College’s Carroll School of Management.
In a nutshell, the suit claims Flynn diverted money from Petro and 25 other investors in an attempt to bail out a struggling Quincy condo complex that Flynn owned.
Flynn and Petro each invested $800,000 when they formed DJF Real Estate Opportunity Fund in January 2008, according to the lawsuit filed last September in Norfolk Superior Court. By January 2009, they had raised another $5.3 million from 25 limited partners, it states.
Condo Purchased
Flynn ran the company day-to-day, the lawsuit states. In February 2011, Flynn allegedly used fund assets to buy a condo complex at 86 Greenleaf St. in Quincy for $2.4 million, but did not disclose the purchase to his partners.
A month later, Flynn allegedly transferred the deed for the property to a new company he founded on March 7, 86 Greenleaf Condominium LLC. He then granted a mortgage on it to an unnamed third party to whom he owed money, the lawsuit claims.
In a June 28, 2011, meeting in Duxbury, Petro and other investors confronted Flynn.
“Flynn admitted in substance to having improperly granted the mortgage, said that he ‘wasn’t supposed to record it’ and repeatedly stated that he would ‘make things right,’” the lawsuit states.
The group demanded Flynn’s resignation and he offered it. The condo property went into foreclosure last year.
Cases against Flynn continue to work their way through the legal system.
On May 15, Jeffrey Bilezikian of Watertown won a $260,000 judgment against Flynn for conversion, unjust enrichment and breach of contract. Bilezikian, who owns a group of commercial real estate properties, said he got to know Flynn at charity auctions and other social events.
According to the complaint, Flynn approached Bilezikian in 2009 about forming a real estate company called D & J Prime Properties and suggested they each contribute $250,000 in seed money.
“He approached me saying, “Hey, there’s a lot of deals out there. What can we do?’” Bilezikian said in an interview this month.
According to the lawsuit, Flynn never deposited any money and withdrew $249,000 of Bilezikian’s funds from a joint checking account. By June 2010, the account balance had dwindled to $100 and the company never conducted a single item of business, the lawsuit states.
Flynn founded his auction house in the 1980s and business thrived as real estate values plummeted in 2008. That year, his company conducted 3,000 auctions generating $10 million in revenue, according to a 2009 profile in the Boston Business Journal.
At the same time, Flynn has found time to conduct auctions on behalf of charities such as the Joey Fund, the Boston Bruins Foundation and local schools and hospitals.
His real estate broker’s license is in good standing with the state Board of Professional Licensure and there are no disciplinary actions against him at this time, a spokeswoman said. Flynn’s auctioneer license is current with the state Division of Standards.
In an unrelated case, one of the few to which Flynn has responded, Flynn stated that he has been battling money problems.
“For the past few years, I have faced tremendous financial pressure that has continued to increase, rather than decrease, over these years in my professional life,” Flynn stated in a Nov. 13, 2012 affidavit. “As a result, at times I have failed to pay the appropriate attention to detail that is necessary and critical to maintaining a good business. I run a very busy auction company and continue to be involved in a number of real estate ventures.”





