Jury Awards $23M In Robert De Niro-Backed Nobu Hotel Chicago Fraud Case
An Illinois federal jury has awarded the company behind Nobu Hotel Chicago $23M in damages, finding the construction company contracted to design and build the property liable for fraud after it stiffed subcontractors, embezzled money for other purposes and failed to complete work.
The jury on Thursday found in favor of NHC LLC against all three defendants in the case: Centaur Construction Co. and two of its executives, Spiro Tsaparas and Peter Alexopoulos. NHC is an arm of hotel developer RCD Resorts, which has partnered with Nobu Hospitality — co-owned by actor Robert De Niro — on a number of hotel projects, including the Nobu Hotel in the West Loop.
The award includes about $20.5M in compensatory damages, Law360 reported, including almost $9.5M to pay subcontractors Centaur allegedly failed to compensate, $10.8M to pay a different company to finish the hotel when it fired Centaur, and $150K in attorney fees NHC paid to settle lawsuits and disputes from unpaid vendors.
Centaur and the two executives were also slapped with punitive damages totaling about $2.5M. Centaur was ordered to pay $630K, while Tsaparas will have to pay $1.5M and Alexopoulos $400K. The sums equate to the amounts the two men are alleged to have transferred to personal accounts, per Law360.
The 12-story Fulton Market District hotel opened in fall 2020, about a year after NHC and RCD filed a federal fraud and breach-of-contract lawsuit accusing Centaur executives of improperly pocketing as much as $8M meant for the project and failing to complete the job.
"Spiro has operated Centaur as a mere façade for himself as the dominant officer of the company," the complaint said, according to Crain’s Chicago Business.
RCD, owned by Mexico's Chapur family, alleged in the suit, filed in September 2019, the venture paid $48.3M — the maximum amount under contract — to design and build the 119-room hotel at 846-854 West Randolph St., but it remained unfinished. Another general contractor was looped in to complete the project.
The suit claimed RCD paid Centaur in installments for construction and that the company’s executives lied about the work being done on the hotel.
Jurors deliberated for just a day after a four-day trial, per Law360.