A renowned Des Moines gastroenterologist has filed a lawsuit in Polk County alleging Orton HOmes President Rob Orton and jailed Johnston developer Daniel Pettit failed to repay him $850,000.
Dr. Bernard Feldmna, who practices at Mercy Hospital in Des Moines, filed the lawsuit on April 22 in Polk County. Though Petti, 43, alleged to owe millions, is the target of a criminal investigation involving widespread allegations of fraud, the new suit is the first to name Orton, CEO of the American Group LLC, a holding company for roughly 20 real estate companies that also includes RE/MAX Precision in Clive.
Neither Feldman nor Orton responded to phone calls seeking comment.
A watchdog probe in December found judgments and debts of nearly $70 million claimed against Pettit and limited liability corporations in which he is involved. The court actions show his failed deals affected not only yet-to-be-constructed developments in West Des Moines but a wide swath of business associates, lenders and companies beyond Iowa.
Feldman alleged in a lawsuit filed last year that he invested his own money in a mix of Pettiās development projects but that Pettit entered into agreements on his own that affected those entities without notifying Feldman. He alleged Pettit also failed to Pay company bills and Misused his money instead of acquiring properties for which his investment was intended.
Among the developments Feldman invested in was a planned West Des Moines apartment complex next to the new Des Moines University campus that never got built. Now, Feldman, the city and an insurance company are arguing in court over who should be financially responsible for site improvements that went uncompleted.
Pettit was ordered to repay Feldman almost $9.3 million in that case after Feldman alleged fraud, fraudulent inducement and misrepresentation.
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