Depo Transcript-Sebok COND

Deposition of:
David Sebok
July 14, 2020
In the Matter of:
Brady, James v. City of Myrtle Beach,

et al.
A. William Roberts, Jr & Assoc.

800-743-3376 | calendar-awr@veritext.com | www.veritext.com
David Sebok July 14, 2020
Brady, James v. City of Myrtle Beach, et al.
Page 1
1 UNITED STATES DISTRICT COURT

DISTRICT OF SOUTH CAROLINA
2 FLORENCE DIVISION
CASE NO. 4:19-cv-00107-DCC
3
JAMES BRADY, INDIVIDUALLY, AND D/B/A JB
4 & HM ENTERPRISES, INC.,
5 Plaintiffs,
6 vs.
7 CITY OF MYRTLE BEACH, STATE OF SOUTH
CAROLINA, DAVID SEBOK, MYRTLE BEACH
8 DOWNTOWN REDEVELOPMENT CORPORATION, AND
METRO PROPERTIES GROUP, LLC,
9
Defendants.
10
11 DEPOSITION OF: DAVID SEBOK
(Appearing by VTC)
12
DATE: July 14, 2020
13
TIME: 9:59 a.m.
14
LOCATION: 3750 Robert M. Grissom Parkway
15 Myrtle Beach, South Carolina
16 TAKEN BY: Counsel for Plaintiffs
17 REPORTED BY: KAREN M. ERNST, CSR
(Appearing by VTC)
18 ___________________________________________________
19
20
21
22
23
24
25
A. William Roberts, Jr & Assoc. 800-743-3376

A Veritext Company www.veritext.com
Page 2 Page 4
1 APPEARANCES OF COUNSEL:
2 ATTORNEY FOR PLAINTIFFS 1 answers as pertinent as possible.
JAMES BRADY, INDIVIDUALLY, AND D/B/A
3 JB & HM ENTERPRISES, INC.:
2 If you want me to repeat anything, of
4 BRITTAIN LAW FIRM 3 course, you can ask me to do that. And that
BY: THOMAS C. BRITTAIN
5 (Appearing by VTC) 4 happens a good bit.
4614 Oleander Drive
6 Myrtle Beach, South Carolina 29577 5 You can't talk to your lawyer about the
843-449-8562
7 tommyb@brittainlawfirm.com 6 case during this deposition. I don't think it will
8 ATTORNEY FOR PLAINTIFF
JB & HM ENTERPRISES, INC.: 7 take all that long. You have a right to have any
9
PLAYER LAW FIRM 8 kind of breaks that you want. If you want to take
10 BY: TUCKER PLAYER
(Appearing by VTC)
9 a break, you certainly can do that. But this is
11 1415 Broad River Road 10 not an endurance test.
Columbia, South Carolina 29210
12 803-772-8008 11 And I think other than that, those are
tucker@playerlawfirm.com
13 12 the ground rules of how we'll proceed.
ATTORNEY FOR DEFENDANTS
14 CITY OF MYRTLE BEACH AND STATE OF SOUTH 13 MR. BRITTAIN: If any other lawyer
CAROLINA:
15 14 wants to add to that, I'd be happy for them to do
BATTLE LAW FIRM
16 BY: MICHAEL WARNER BATTLE
15 so.
17
(Appearing by VTC)
1200 Main Street
16 THE WITNESS: Okay.
Conway, South Carolina 29526 17 BY MR. BRITTAIN:
18 843-248-4321
mbattle@battlelawsc.com 18 Q. All right. Hearing nothing, what's
19
ATTORNEY FOR DEFENDANTS 19 your full name, Mr. Sebok?
20 DAVID SEBOK AND MYRTLE BEACH DOWNTOWN
REDEVELOPMENT CORPORATION 20 A. David A. Sebok.
21
NELSON MULLINS RILEY & SCARBOROUGH,
21 Q. And give me a little bit of a
22 LLP
BY: ANDREW M. CONNOR
22 background of you, kind of where you were born and
23 (Appearing by VTC) 23 raised, grew up, what kind of education and work
151 Meeting Street, Sixth Floor
24 Charleston, South Carolina 29401 24 history you've had.
843-853-5200
25 andrew.connor@nelsonmullins.com 25 A. I was raised in New Jersey. After high
Page 3 Page 5
1 THE REPORTER: Can I get a stipulation 1 school, I went to LSU.
2 on the record that it's okay for me to swear the 2 THE REPORTER: I'm having a hard time
3 witness remotely? 3 hearing the witness.
4 MR. BRITTAIN: I so stipulate. 4 THE WITNESS: Okay. I'll try to speak
5 MR. BATTLE: I consent. 5 up.
6 MR. CONNOR: Stipulated. 6 I was raised in New Jersey, and after
7 MR. PLAYER: Same here. 7 high school, I went to college at LSU in Baton
8 DAVID SEBOK 8 Rouge and studied architecture and planning. I
9 being first duly sworn, testified as follows: 9 graduated. After that, I worked for the private
10 EXAMINATION 10 sector in commercial and residential redevelopment
11 BY MR. BRITTAIN: 11 in Maryland and Upstate New York. And then I
12 Q. Mr. Sebok, my name is Tommy Brittain. 12 eventually went to work in the public sector in
13 I'm the lawyer here in Myrtle Beach. I've been 13 Duluth, Minnesota, Minneapolis.
14 practicing law here for quite some time. 14 THE REPORTER: I'm sorry. Can we maybe
15 I've had the pleasure of meeting you in 15 have the microphone closer to the witness?
16 person. We're getting ready to take your 16 THE WITNESS: And worked in the City of
17 deposition. Have you ever had your deposition 17 Duluth, Minnesota, in Minneapolis, and then
18 taken before? 18 eventually the City of Myrtle Beach.
19 A. Yes. 19 THE REPORTER: I'm still having a
20 Q. All right, sir. Well, I need to 20 really hard time hearing the witness.
21 explain to you the ground rules as part of my duty 21 MR. BRITTAIN: I can't hear him either.
22 under the discovery statute. And number one is 22 THE WITNESS: Okay. I eventually went
23 that you and I basically try to work out any 23 to work for the public sector working the cities of
24 problems that we're having communicating with one 24 Duluth, Minnesota, Minneapolis, Minnesota and
25 another. My questions need to be clear and your 25 eventually in 2000, the City of Myrtle Beach.
2 (Pages 2 - 5)
Page 6 Page 8
1 And I -- in those jobs I was in charge 1 later after that, didn't you? You said 1997. When
2 of economic redevelopment and development of the 2 you were hired was what year?
3 cities involved. 3 A. 2000. The end of '99, September of
4 THE REPORTER: I'm having a hard time 4 '99.
5 hearing you. 5 Q. So was there any activity that you were
6 MR. BRITTAIN: I can't hear him. 6 engaged in in what we call the Superblock from 2000
7 (A recess transpired.) 7 until, say, 2013?
8 BY MR. BRITTAIN: 8 A. Well, it was referred to as Superblock.
9 Q. Let me ask you about those other jobs 9 It was a part of that particular area, one of the
10 once you entered the public sector. I think you 10 sub areas discussed in the pavilion area master
11 referred to the public sector. 11 plan. And so to that extent, it's an area that we
12 A. Yes, sir. 12 did get involved with.
13 Q. So were those other jobs in Minnesota 13 Q. When did you start engaging with
14 and the other places similar to the job you took 14 businesses that were in the Superblock concerning
15 here in Myrtle Beach as far as Redevelopment 15 their business activity and plans to change the
16 Corporation was concerned? 16 area? What year would that have been?
17 A. They were similar, but every city had 17 A. I'm assuming it was not long after
18 its own -- state had its own unique set of 18 2000, but the plan was not necessarily to change
19 employment objectives, you know, how I was hired 19 the area, it was to assist those businesses in
20 and who I worked for. It was similar in that my 20 becoming more successful. Not necessarily to
21 job was to help develop or redevelop portions of 21 change the area.
22 cities. 22 Q. Well, what was your involvement with
23 Q. All right, sir. So let me ask you, in 23 C&C Moving Company?
24 those previous jobs that you had, were you involved 24 A. I think they eventually left the
25 in trying to change the nature of the particular 25 business and closed that business down. And our
Page 7 Page 9
1 location, that is, get certain businesses out and 1 job was always to assist property owners for
2 certain businesses in, or is that something you've 2 businesses to expand their business or find tenants
3 ever done before? 3 for their business or find buyers for their
4 A. I never was in charge of getting 4 property. We offered assistance in that effort.
5 businesses out of a particular city. We did try to 5 It's a liaison between the prospective buyers and
6 attract new businesses or get businesses within a 6 developers and them.
7 city. 7 Q. Did your company keep records?
8 Q. If you're going to redevelop something, 8 A. Yes.
9 you're talking about changing the nature of the 9 Q. Do you have any records of your
10 area; is that correct? 10 involvement with C&C Moving Company?
11 A. Yes. 11 A. I don't. For whatever reason, the DRC
12 Q. What can you tell me about the 12 files, I don't think there was much involvement
13 Redevelopment Corporation here in Myrtle Beach? 13 with them. They were an ongoing business at the
14 A. The City, over a period of roughly 14 time and they closed that business and then they
15 20 years before I got here in 2000, had hired a 15 were looking to, I believe, sell their property or
16 consultant to provide master plans or expert advice 16 get a new tenant for their property.
17 to them on how to redevelop various portions of the 17 Q. Well -- I'm sorry. Go ahead, sir.
18 city. The pavilion area master plan was completed, 18 A. I don't recall which was their
19 I think, in '97 or 8, and that was the master plan 19 objective back then.
20 that the City utilized to create the Downtown 20 Q. And my point is that the businesses
21 Redevelopment Corporation, DRC. And the DRC's 21 were there from 2000 until about 2013 or '14. Your
22 mission was to advise the City and help with the 22 company had very little interaction with them.
23 location of various recommendations of that master 23 Isn't that true?
24 plan. 24 MR. PLAYER: Object to the form.
25 Q. All right, sir. You came along a lot 25 MR. BRITTAIN: Now, when that comes up,
3 (Pages 6 - 9)
Page 10 Page 12
1 you still answer the question. 1 A. I don't know.
2 BY MR. BRITTAIN: 2 Q. You don't know whether C&C -- do you
3 Q. I forgot to tell you this. What's 3 recall having any conversations personally with
4 going to happen -- what's going to happen, and 4 anybody that owned C&C Moving Company?
5 that's perfectly fine, but unless your lawyer 5 A. I don't recall whether I did or didn't.
6 instructs you not to answer the question, even 6 Q. But you remember the nature of that
7 though there is an objection, you will answer it 7 business in this area?
8 and then the Court and your lawyer and I will 8 A. I believe it was -- it started with,
9 decide whether that's a proper question or not but 9 like, a warehouse, an antique store collection of
10 just to kind of let you know going forward. 10 various types of furniture and things like that.
11 A. Okay. 11 Q. Do you know who bought that building
12 Q. That's how we -- 12 from C&C Moving Company?
13 A. Yes, I understand. 13 A. No, I don't recall.
14 Could you repeat the question. 14 Q. All right. Do you have a written
15 Q. Yeah. 15 contract with the Redevelopment Corporation and/or
16 I mean, the truth of it is that you 16 the City of Myrtle Beach?
17 have very little interaction with the businesses 17 A. I don't know what you mean by "written
18 that were in the Superblock from 2000 up until 18 contract."
19 about 2014. I mean, there wasn't an active effort 19 Q. I mean an agreement between the two of
20 on your part to go talk to C&C Moving Company or 20 you as to what you're going to do and what they're
21 the other businesses in the area. That came later 21 going to pay you put down in writing and signed by
22 after the city council had made some decisions 22 two responsible parties?
23 about trying to put other businesses in there, the 23 A. Yes. I was hired by the City and then
24 Children's Museum. It was a fairly inactive 24 contracted to the DRC to be the administrator for
25 redevelopment project with these businesses in the 25 the DRC.
Page 11 Page 13
1 2000 to, say, 2010, '12 area? 1 Q. Does it have a job description in it?
2 MR. PLAYER: Object to the form. 2 A. I believe it did. Primarily it was to
3 THE WITNESS: That's not true. We were 3 implement the area master plan and advise.
4 very active in all of the various subdistricts 4 Q. All right, sir. Would you be willing
5 within the DRC area, and I believe the Superblock 5 to provide me a copy of that contract?
6 was an area that was right near city hall. And we 6 A. I don't have it.
7 were very active in contacting those businesses, as 7 Q. You don't have a copy of your own
8 we did others. And, in fact, we established and 8 contract?
9 created what was called a storefront loan program 9 A. I'm retired. I've been retired two and
10 which was targeting initially only those in the 10 a half years. I don't have any documents. The
11 Superblock area, to help those businesses redo 11 City would have those.
12 their facades, landscaping, parking areas. And so 12 MR. CONNOR: Objection.
13 we were actually very involved with businesses and 13 BY MR. BRITTAIN:
14 property owners throughout that period. 14 Q. Do you have any objection if the
15 BY MR. BRITTAIN: 15 Redevelopment Corporation or the City of Myrtle
16 Q. Okay. Do you think you can look 16 Beach makes that document available to me?
17 through your records and find your records that 17 A. No. It's public information.
18 would substantiate that? 18 Q. I'm trying to get a feel for now your
19 A. I don't have access to any of those 19 interaction and the Redevelopment Corporation's
20 records, and, you know, I'm sure there were emails 20 interaction with the city council and the city
21 and there were FOIA notices, and we had a, I don't 21 manager. If you could tell me how that worked. I
22 know if it was, a website or a newsletter at the 22 mean, did you appear in front of the city council
23 time that talked about a storefront loan program 23 to answer questions? Did they have somebody on
24 and assisting the DRC developer. 24 your board that was connected to what you were
25 Q. Who owned C&C Moving Company? 25 doing? What was the nature of that relationship?
4 (Pages 10 - 13)
Page 14 Page 16
1 A. The City created the DRC, and then by 1 A. We recorded those.
2 the bylaws of the DRC, the city manager was one of 2 Q. All right, sir.
3 11 board members and also the treasurer of the DRC. 3 A. And we kept brief meeting notes, and,
4 And the City also could appoint one of its members, 4 you know, we kept a record of those.
5 council members, or somebody else to represent the 5 Q. Who was the secretary to the board that
6 city council -- the mayor and city council on the 6 would have taken those notes?
7 DRC, which they did. So of the 11 board members, 7 A. Well, I had an executive assistant and
8 there were two seats, two memberships, reserved for 8 that person generally took notes. There was one of
9 city representation. The rest of the board members 9 the board members who was president, vice
10 were appointed by the board of directors. 10 president, treasurer and secretary of the board,
11 Q. So the City, through that 11 but the staff person generally reported, not
12 representation, had actual knowledge of the 12 necessarily always, reported the meeting and took
13 activities of the Redevelopment Corporation? 13 notes. Those notes were then produced at
14 MR. CONNOR: Object to the form. 14 subsequent meetings and approved by the board as
15 THE WITNESS: The DRC was an advisory 15 meeting minutes.
16 body to the City. And its mission, again, was to 16 Q. And so what was the name of that person
17 follow recommendations to the area master plan, 17 who would have taken those notes and presented them
18 trying to revitalize and approve the downtown area. 18 as minutes at the next meeting?
19 BY MR. BRITTAIN: 19 A. There were several people over a period
20 Q. You didn't try to keep anything from 20 of the 17 years that I was executive director of
21 the City; you were trying to involve the City, let 21 the Redevelopment Corporation of Myrtle Beach.
22 them know what your efforts were and what you were 22 Q. Can you name them?
23 doing; isn't that correct? 23 A. Kelly Amichdally [phonetic] then Kori
24 MR. CONNOR: Object to the form. 24 (Brett) McKeithan. There was another person before
25 THE WITNESS: We followed the pavilion 25 that who was there for a year, and then ultimately
Page 15 Page 17
1 area master plan recommendations. And obviously 1 Rory Glover was the last person in that position.
2 the City knew about those. And some of those 2 Q. So those minutes should still be --
3 actions that we were involved in with the pavilion 3 those minutes should be something we could -- you
4 area master plan, in fact most, required city 4 could find and I could find if I needed to,
5 council action, not DRC action. 5 correct?
6 BY MR. BRITTAIN: 6 A. I can't find them but they exist.
7 Q. You had a substantial amount of email 7 Q. Who did you report to, Mr. Sebok?
8 correspondence with John Pedersen, didn't you? 8 A. I reported to the DRC Board of
9 MR. CONNOR: Object to the form. 9 Directors.
10 THE WITNESS: I don't know what 10 Q. All right. And who was the president
11 "substantial" means. We certainly communicated 11 of that board?
12 with each other. 12 A. Again, that changed from year to year.
13 BY MR. BRITTAIN: 13 There were term limits. Officers came and went on
14 Q. Did you send any email to John 14 the board, so it changed over time.
15 Pedersen? 15 Q. Who was the president from, say, 2014
16 A. I'm sure I did. 16 until you retired?
17 Q. What was his job? 17 A. Probably Chuck Martino was president
18 A. He initially was city manager. He was 18 during most of that time. I don't know what year
19 hired by the mayor of city council to be city 19 he became president.
20 manager. 20 Q. Did you ever appear in front of or have
21 Q. Did the Redevelopment Corporation have 21 direct communications with the full city council?
22 any corporate meetings? 22 A. Yes.
23 A. We had monthly meetings. 23 Q. And that would be to get an update on
24 Q. Did you have a secretary who took 24 what was going on or for what other purpose?
25 minutes of those meetings? 25 A. Sometimes it would be an action that
5 (Pages 14 - 17)
Page 18 Page 20
1 city council was entertaining. They might seek art 1 THE WITNESS: I believe that the DRC
2 to put on, an art. Advice. For the most part, we 2 only had one contract with Metro Properties, and it
3 did propose various actions to implement components 3 was at the direction of city council to hire
4 of the DRC master plan, but also it was to report 4 someone to assemble properties within the footprint
5 to city council the status of the DRC's activities. 5 of the Burroughs & Chapin Library.
6 Q. Who's Brown Bethune? 6 THE REPORTER: I'm having a really hard
7 A. Brown Bethune, I believe, is -- I 7 time hearing this witness.
8 believe he worked at one point at Burroughs & 8 BY MR. BRITTAIN:
9 Chapin and either is a realtor or was a realtor. 9 Q. All right. Mr. Sebok, I was asking you
10 That's all I know about Brown Bethune. I believe 10 some questions about Scott Taylor and Metro
11 he's now married. 11 Properties. And I asked you if the Redevelopment
12 Q. Married to who? 12 Corporation entered into an agreement with him, and
13 A. Mayor Bethune. 13 I believe you said they did; is that correct?
14 Q. What involvement did you have with 14 A. Yes.
15 Brown Bethune as part of the redevelopment 15 Q. What was he doing for you? What was he
16 committee? 16 doing for the Redevelopment Corporation?
17 A. I don't think we really had any. I 17 A. He was hired to assemble the properties
18 think Mr. Bethune at one time was a member of the 18 within the footprint of the proposed Chapin Library
19 Community Appearance Board in the city, which at 19 and Children's Museum redevelopment project.
20 times the DRC did appear before because it was some 20 Q. Okay. So he was part of a program to
21 action that they were considering building or 21 get some businesses to make some changes -- get
22 something like that within the DRC district. And I 22 some businesses in there that were compatible with
23 believe that he is a member of that board, but that 23 the Children's Museum?
24 would be the only direct involvement I can recall. 24 MR. CONNOR: Object to the form.
25 Q. What other realtors did you work with 25 THE WITNESS: No. His only job was to
Page 19 Page 21
1 as part of the Redevelopment Corporation? 1 acquire properties.
2 A. We worked with any realtor who 2 BY MR. BRITTAIN:
3 approached us and answer information about 3 Q. And how do you mean "acquire" them?
4 opportunities within DRC. 4 What was he supposed to do? Buy them himself or
5 Q. Who's Scott Taylor? 5 get y'all a price for them or get somebody else a
6 A. Scott Taylor is a realtor, I believe 6 price for them? What was the deal there?
7 it's called Metro Properties, and he has -- he's a 7 A. He would make offers to property owners
8 realtor, but I believe that's -- 8 and also, if there were any tenants, to assist with
9 Q. I mean, your company -- the corporation 9 relocation opportunities for those tenants, but
10 entered into a specific agreement with Scott 10 primarily to make an offer, acquire a particular
11 Taylor, didn't it? 11 parcel, and then upon acquisition by Metro
12 A. Yes, we did. 12 Properties of that parcel, it would be transferred
13 MR. PLAYER: Object to the form. 13 to the DRC. The DRC would hold those properties
14 BY MR. BRITTAIN: 14 until such time as the City needed to re -- was
15 Q. In other words, I've seen some 15 prepared to redevelop the properties.
16 documents, it looks like going back and forth 16 Q. Okay. So -- and we're talking about
17 between -- what was the name of his company, 17 the Superblock area, correct?
18 Mr. Sebok? 18 MR. CONNOR: Object to the form.
19 A. I believe it was Metro Properties or 19 THE WITNESS: He was hired to acquire
20 Metropolitan Properties, something like that. 20 the properties within the -- the city council
21 Q. And the corporation had a signed 21 identified a footprint, which was part of the
22 agreement with Scott Taylor to deal with numerous 22 Superblock area.
23 projects that the Redevelopment Corporation was 23 MR. CONNOR: Same objection.
24 interested in; isn't that true? 24 BY MR. BRITTAIN:
25 MR. CONNOR: Object to the form. 25 Q. How many projects did you have him
6 (Pages 18 - 21)
Page 22 Page 24
1 working on? 1 Convention Center. And so the DRC initially was
2 A. That was the only one that I recall. 2 looking to marry them with other properties,
3 Q. One I think I saw in the agreement was 3 redevelopment properties, primarily in the downtown
4 project A, B, C, and D. Does that mean anything to 4 hotel district as part of the hotel redevelopment
5 you? 5 project. The Children's Museum, they were open to
6 A. Yes. A was the Children's Museum 6 any and all sites for consideration, at least
7 project. There were -- there was a potential that 7 initially.
8 DRC was working with some property owners in other 8 So at some point -- and the city
9 areas of the downtown district to help redevelop 9 manager, who is a member of the DRC, John Pedersen,
10 those properties, but, you know, nothing really 10 was aware that the Children's Museum was looking
11 materialized with those. 11 for a new site. And so the idea was, perhaps the
12 Q. So the game plan here was he was acting 12 Children's Museum would be a good candidate to be
13 basically as a realtor for the DRC; is that 13 partnered with the Chapin Library in a new project.
14 correct? 14 And the site that was identified that was
15 MR. CONNOR: Object to the form. 15 acceptable to the City and the Children's Museum
16 THE WITNESS: He was acting -- I don't 16 was the site, you know, in the Superblock area
17 know if realtor is the right word. He was to 17 because it was visible and accessible from Kings
18 acquire certain properties within certain 18 Highway along 9th Avenue, abutted Nance Plaza, a
19 parameters of a purchase price and then convey 19 public space. And many of the properties within
20 those to the DRC. 20 that footprint that met the size requirements were
21 BY MR. BRITTAIN: 21 vacant or undertenanted.
22 Q. Okay. So the game plan was for him to 22 Q. So as part of that process, was it
23 approach people, get a price, and the DRC 23 important for surrounding businesses to be, quote,
24 eventually owned certain properties? 24 compatible with a Children's Museum-type use?
25 MR. CONNOR: Object to the form. 25 A. I don't know that we were -- the DRC
Page 23 Page 25
1 THE WITNESS: Yes. 1 was involved in making any determination about what
2 BY MR. BRITTAIN: 2 was compatible and what wasn't. If it was a legal
3 Q. Okay. Now -- and once the DRC owned 3 property, then it was a legal property. And as
4 certain properties, then the DRC would be 4 long as it obeyed the laws, that was fine.
5 responsible for, quote, transferring those 5 Q. I mean, you were trying to get rid of
6 properties to other owners? 6 the bars in the area, weren't you?
7 MR. CONNOR: Object to the form. 7 MR. CONNOR: Object to the form.
8 THE WITNESS: The DRC was supposed to 8 THE WITNESS: The DRC was not trying to
9 hold these properties until the entire footprint of 9 get rid of any businesses in any area of the
10 the site, redevelopment site, was assembled and 10 downtown area.
11 then at some point thereafter, when the City was 11 BY MR. BRITTAIN:
12 prepared, to transfer those properties to the City 12 Q. How did the DRC obtain the loan to
13 so that the City could implement the Children's 13 purchase any Superblock properties?
14 Museum and Chapin Library project. 14 A. The City and DRC worked with a
15 BY MR. BRITTAIN: 15 consortium of local banks to create a loan pool of
16 Q. Okay. And like, for example, what's 16 $10 million, which was to be utilized for various
17 EdVenture? 17 redevelopment projects, not just the Children's
18 A. EdVenture was a name for the Children's 18 Museum and library project, as a resource to get
19 Museum. I believe that's the parent corporation. 19 redevelopment to occur. And the DRC pledged
20 Q. And what properties was the City trying 20 certain parking revenues to the banks in support of
21 to acquire for the Children's Museum? 21 that loan as a credit.
22 A. Initially, the Children's Museum 22 Q. Was there any other security for the
23 approached the DRC because they were looking to be 23 loan?
24 relocated from the location that they were at, 24 A. The primary security for the loan was
25 which was over by the old mall site across from the 25 the pledge of the revenues generated by parking
7 (Pages 22 - 25)
Page 26 Page 28
1 meters. And there may have been a good faith 1 appraisals and processes for that should the City
2 promise from the City but not a contractural 2 decide to pursue that, but the City had not at that
3 promise that I recall. 3 point decided to use eminent domain for any
4 Q. Do you know a man named Andrew 4 acquisitions.
5 Paulssen? 5 He became agitated and then left the
6 A. Yes, I do. 6 office.
7 Q. Did you have any conversations with him 7 Q. Did you tell him in that meeting that
8 about purchasing his property on behalf of the DRC? 8 he could not leave your office until he had a
9 A. His property -- House Parts was a 9 signed agreement for the sale of his store?
10 business that had been in the DRC district for 10 A. No, not at all. Again, my role was not
11 several years and was within the footprint of the 11 to be involved directly in the acquisition of a
12 proposed Chapin library/children's museum 12 particular property.
13 redevelopment project. Once the City decided it 13 Q. How many properties were obtained
14 wanted to have those properties assembled for the 14 through eminent domain in this area?
15 redevelopment project, the only person that was 15 A. None. None that I know of.
16 authorized to contact property owners about 16 Q. Okay. I'm sorry. I'll give you plenty
17 acquisition of their properties was Scott Taylor, 17 of time to complete your answer.
18 through the DRC contract. 18 A. Okay.
19 At some point, I believe it probably 19 Q. None that you know of?
20 was after Scott Taylor had had some initial 20 A. None that I know of.
21 meetings, perhaps even made a proposal to 21 Q. Who met with Justin Lovely and Mike
22 Mr. Paulssen to acquire his property, that Andrew 22 Kelly to explain to them that their properties were
23 came to the DRC offices and asked to meet with me. 23 not necessary to be purchased for the DRC or the
24 Lauren Clever, the executive assistant, and I 24 City?
25 agreed to meet with him. We met in my office. 25 A. Lauren Clever and myself.
Page 27 Page 29
1 Andrew and Lauren sat at the conference table, and 1 Q. Who's Tim Wilkes?
2 I either sat at my desk or leaned on my desk, and 2 A. Tim Wilkes is a businessperson who owns
3 the door to the office was open at that time. And 3 various properties throughout the city and I
4 Andrew essentially wanted to ask a couple of 4 believe on the East Coast and operates, you know,
5 questions because now there were rumors and the 5 various businesses, you know, on those properties.
6 speculating about this project and properties being 6 Q. As any connection with your
7 acquired, what was going on, because some 7 responsibilities with the DRC, have you received
8 properties had already been acquired, and he wanted 8 complaints from people like Tim Wilkes that the
9 to know who was acquiring the properties and for 9 Redevelopment Corporation has played favorites with
10 what purpose. And I informed him that the only way 10 the properties, taken less money to get a
11 he -- at that point that he could be made aware of 11 particular owner in a particular spot? Have you
12 the parties involved and the project was if he 12 had any complaints like that from Tim Wilkes or
13 signed a nondisclosure agreement, which was offered 13 others?
14 to him by Scott Taylor and others, anybody who 14 A. Can you ask that again?
15 wanted to know about the project. 15 Q. Here's what I'm asking. Here's what
16 And Andrew, I believe, did not want to 16 I'm asking. You know, have you had any complaints
17 sign a nondisclosure agreement, so we were not at 17 that your corporation and/or the City had played
18 liberty -- permitted to inform him or answer his 18 favorites in the area with the properties, you
19 question. 19 know, that you might take less money to get a
20 At some point the topic of eminent 20 particular owner than someone else? Have you had
21 domain came up. I don't really recall how it came 21 such a complaint like that as far as this process?
22 up. And I informed him that the City, under State 22 A. I don't believe so.
23 of South Carolina laws, was the only local 23 MR. CONNOR: Object to the form.
24 authority that could exercise the eminent domain 24 BY MR. BRITTAIN:
25 powers that were prescribed procedures and 25 Q. Have you had any complaints from Tim
8 (Pages 26 - 29)
Page 30 Page 32
1 Wilkes? 1 the process of assembling properties within the
2 A. Tim, because he owned some properties 2 footprint, Scott Taylor did contact all other
3 in the downtown area, not in the Superblock area, 3 property owners within the Superblock area to just
4 he had issues with, you know, some of the 4 let them know that, you know, there might be an
5 regulations and some of the things that were going 5 opportunity, if they had a vacant space, to get a
6 on in and around his businesses that affected his 6 new tenant as a result of some relocation projects
7 businesses. And he, I'm sure, in our 7 or that there might be somebody else that, you
8 conversations, complained about the business 8 know, could be interested in acquiring their
9 climate along Ocean Boulevard, but not in the 9 property, but the DRC and the City were not
10 super -- he didn't have any properties in the 10 interested in acquiring any other properties
11 Superblock that I'm aware of. 11 outside the footprint.
12 Q. And have you had any complaints about 12 Q. Do you know Jim Brady?
13 your corporation and you and the City using the 13 A. I don't believe I've ever met him. I
14 City's power, including police power, to, quote, 14 may have talked to him briefly on the phone, but I
15 run people out of their businesses? 15 don't really think I've ever met him.
16 A. I don't recall any complaints. It's 16 Q. Okay. Who were the Karams? Do you
17 possible that somebody could have, you know, 17 know them? Elmadani Karam and Mohammed Karam, do
18 complained in the course of our, you know, routine, 18 you know them?
19 you know, walking around the downtown district, 19 A. Say the names again.
20 particularly along the boardwalk and Ocean 20 Q. Let me spell it K-a-r-a-m.
21 Boulevard, but I don't recall any specific 21 A. That doesn't ring a bell.
22 complaints. 22 Q. How about Danny Groove, LLC?
23 Q. Do you know who Henry and Virginia 23 A. I've heard the name, but I don't know
24 Brewington are? 24 anything about it.
25 A. No. 25 Q. You don't know whether they've had any
Page 31 Page 33
1 Q. Do you know what Levelz Bar & Grill is, 1 complaints about how they were treated in their
2 or was? 2 business by the City of Myrtle Beach during this
3 A. Levelz? 3 time period, say 2014 to 2017?
4 Q. Yes. 4 A. I don't have any knowledge about that.
5 A. I don't recall. 5 Q. How about Michael E. Hobeika, III, do
6 Q. Who is Natalie Litsey? 6 you know him?
7 A. I believe that Natalie was an operator 7 A. I know Mr. Hobeika.
8 of a bar in the Superblock area. 8 Q. What kind of involvement did you have
9 Q. What involvement did you have with her? 9 with Mr. Hobeika?
10 A. Our only involvement was after -- she 10 A. He owned a property at the corner of --
11 was the tenant in a property within the footprint 11 well, I guess it would have been 8th Avenue, Main
12 of the Children's Museum/Chapin Library 12 Street really, and Kings Highway. There was a
13 redevelopment project. And once that property was 13 corner property that initially was included as part
14 acquired, we assisted her in letting her get her 14 of the footprint for the state but was not critical
15 possessions out of the property. 15 to that site. He was contacted by Scott Taylor to
16 Q. Did you try to move a Metro Properties 16 make an offer on his property but -- and over the
17 into the buildings owned by the plaintiff in this 17 years, Mr. Hobeika had wanted to sell his property.
18 case? 18 We thought he would be a willing seller, but he
19 A. No. 19 decided that he didn't want to sell his property,
20 Q. Did you ever tell the plaintiff in this 20 or at least not for the price of his offer.
21 case, Jim Brady and Hector Melendez, his tenant, 21 Q. All right, sir. But you're aware of
22 that they would start getting offers for their 22 the fact that most of these people have actually
23 property? 23 filed lawsuits over the conduct of the City and the
24 A. No. That property was never within the 24 Redevelopment Corporation based on the use of their
25 footprint of the redevelopment project. As part of 25 businesses, their property?
9 (Pages 30 - 33)
Page 34 Page 36
1 MR. CONNOR: Object to the form. 1 Q. Well, I mean, you're in the process of
2 THE WITNESS: I really don't have any 2 assessing and trying to acquire properties on
3 knowledge about other lawsuits like that. 3 behalf of the corporation, correct?
4 BY MR. BRITTAIN: 4 MR. CONNOR: Object to the form.
5 Q. Okay. Are you sure you had no direct 5 THE WITNESS: We hired Metro Properties
6 communication with Jim Brady? 6 to acquire properties.
7 MR. CONNOR: Object to the form. 7 BY MR. BRITTAIN:
8 THE WITNESS: Like I said, I don't 8 Q. But, I mean, you were involved in the
9 recall any -- it may have been one phone call 9 decision-making once those opportunities arose;
10 because Scott Taylor was trying to -- if it's the 10 isn't that correct?
11 Hector Melendez property that Mr. Brady owned -- 11 MR. CONNOR: Object to the form.
12 BY MR. BRITTAIN: 12 THE WITNESS: No. It was just a
13 Q. Yes. Yes. And let me -- let me -- 13 contract relationship with Metro.
14 that fellow has been unfair to me. 14 BY MR. BRITTAIN:
15 Hector Melendez was the tenant. And 15 Q. I mean, they tell you a price or a
16 Andrew can straighten me out if I'm misinforming 16 proposition, and you and the board made a decision
17 you here. And Brady and Brady's company was the 17 based on that, correct?
18 owner. So you probably -- what kind of interaction 18 MR. CONNOR: Object to the form.
19 did you have with Hector Melendez? 19 THE WITNESS: The city council really
20 A. We knew Hector when he renovated 20 was the ultimate end-user of the redevelopment
21 Mr. Brady's property into a nightclub. We were 21 site, and the city council is the one that would
22 supportive of that redevelopment because it had 22 have to agree within certain parameters to an
23 been vacant for some time, I believe. And 23 acquisition price. If the seller of the property
24 Mr. Brady -- at some point there was a sign in the 24 was agreeable to the price within those parameters,
25 window of Mr. Brady's property. I can't remember 25 then the DRC and the board did acquire them, yes.
Page 35 Page 37
1 if it was advertising for sale or for lease, but 1 If it was outside the parameters that were given to
2 Scott Taylor was trying to reach the owner of the 2 us, then we would have to seek additional authority
3 property to, again, see if they were possibly 3 or approval.
4 interested in a new tenant or perhaps they wanted 4 BY MR. BRITTAIN:
5 to sell their property, even though it was not in 5 Q. But you were part of that process;
6 the footprint of the project, redevelopment 6 isn't that correct?
7 project, and he had trouble getting an answer from 7 MR. CONNOR: Object to the form.
8 that phone call and asked me if I could try. And I 8 THE WITNESS: I was aware -- I was the
9 tried and I think I may have gotten through to 9 conduit communicating, advising between Scott
10 Mr. Brady and just said that, you know, we were 10 Taylor, who was making the offers, and the DRC
11 trying to get ahold of Hector or the owner of the 11 board and/or City, depending on the situation. I
12 property. And that's the extent of any contact I 12 communicated the details and facts of those offers.
13 think I had with Mr. Brady. 13 BY MR. BRITTAIN:
14 Q. Did you ever tell Mr. Brady that you, 14 Q. In fact, I believe you signed a
15 you, David Sebok, would never allow the operation 15 contract with Scott Taylor's company, didn't you?
16 of a business of the type of Hector Melendez's in 16 MR. CONNOR: Object to the form.
17 the property that Jim Brady owned? 17 THE WITNESS: Yes, we did.
18 A. No, I did not and would not have -- 18 BY MR. BRITTAIN:
19 that's not our job. 19 Q. When you say "we," I mean David Sebok
20 Q. What constitutional rights to property 20 signed it, correct?
21 does an owner have? 21 A. Yes, I did.
22 MR. CONNOR: Object to the form. 22 Q. Okay. And I think I asked you earlier,
23 THE WITNESS: I'm not an expert in 23 you were not aware of any eminent domain purchases
24 that. I can't answer that. 24 in this area; is that correct?
10 (Pages 34 - 37)
Page 38 Page 40
1 THE WITNESS: I don't believe that the 1 Q. And during that period, the
2 City ever exercised its powers for eminent domain 2 Redevelopment Corporation didn't have somebody like
3 in that area that I was aware of to acquire 3 Scott Taylor under contract out there trying to buy
4 properties. 4 or sell those properties, right?
6 Q. Let me ask you about the two properties 6 THE WITNESS: Correct. The DRC really
7 in question, which would be 803 and 805 Main 7 was not in the position to acquire any properties.
8 Street, Myrtle Beach, South Carolina. You admit 8 That wasn't part of the action plan in terms of the
9 they're owned by Plaintiff Brady and/or one of his 9 pavilion area master plan.
10 business associations -- 10 BY MR. BRITTAIN:
11 MR. CONNOR: Object to the form. 11 Q. What do you know about Hector Melendez?
12 BY MR. BRITTAIN: 12 What had been your involvement with Hector
13 Q. -- or do you know? 13 Melendez?
14 A. I really don't know. You know, it's a 14 A. Our involvement was that we became
15 matter of public record, I guess, with Horry 15 aware that he was redeveloping, I say Mr. Brady's
16 County. 16 property, into a nightclub, and, in fact, we asked
17 Q. Okay. And during the time -- I think 17 Hector if we could hold a staff meeting of the City
18 you said you came in '97. You began your job here 18 manager's executive staff of department directors,
19 with the City in '97 or with the Redevelopment 19 which occurred every Monday, and occasionally the
20 Corporation in '97; is that correct? 20 DRC hosted those meetings, and we would always try
21 A. It was the end of '99. 21 to host them at businesses or properties within the
22 Q. '99. I'm sorry. Okay. Thank you. 22 DRC district so that we could showcase those
23 You'd agree with me, wouldn't you, that 23 properties to the rest of the city officials,
24 at that time period and up until sometime in the 24 senior officials. And we asked Hector if we could
25 middle of, say, 2010, just to get through, that 25 host that kind of a meeting on a Monday morning,
Page 39 Page 41
1 area over there was essentially abandoned except 1 and he agreed. He was not completely done with his
2 for some old businesses, and there were homeless 2 renovations and was not open for business yet, I
3 individuals over there, it was a problem area, even 3 don't believe. Well, he was not open for business
4 having fires in the buildings, you know, for some 4 because it wasn't completed, his renovations. But
5 people that were homeless. I mean, it was a 5 we did host that meeting and thanked him for being
6 trouble spot for the city during that time period. 6 a new business owner in that area. And he was
7 MR. CONNOR: Object to the form. 7 present at that meeting.
8 THE WITNESS: And your question is? 8 Q. Do you know a person, and I only have
9 BY MR. BRITTAIN: 9 his first name right now, named Bruce, who had
10 Q. Yeah. I mean, I'm just asking you. 10 something to do with zoning in the City of Myrtle
11 What I believe is true, and I'm asking you whether 11 Beach?
12 you know it or not, is, let's say, from 1999, when 12 A. You're probably talking about Bruce
13 you came on board, until, let's say, 2010, that 13 Boulineau, who was the director of -- I might have
14 11-year period, this area over here was very 14 his exact title here -- code enforcement, building
15 troubled. There were homeless people congregating. 15 permits and code enforcement.
16 There was misconduct. It was a depressed and bad 16 Q. And didn't Mr. Brady tell you or
17 sort of property use for the City of Myrtle Beach. 17 Mr. Melendez -- I'm sorry, Mr. Melendez tell you
18 MR. CONNOR: Object to the form. 18 that Mr. Boulineau told him that he would do
19 THE WITNESS: It was an area identified 19 everything possible to never let him open a bar in
20 in the pavilion area master plan, along with other 20 that location?
21 areas of the DRC district, it did have some 21 MR. CONNOR: Object to the form.
22 problems with code compliance and vacancies, vacant 22 THE WITNESS: I don't have any
23 properties, deteriorated properties, and it was an 23 knowledge of that.
24 area that was underdeveloped. 24 BY MR. BRITTAIN:
25 BY MR. BRITTAIN: 25 Q. Do you know anything about the
11 (Pages 38 - 41)
Page 42 Page 44
1 complaints that Mr. Melendez and Mr. Brady have 1 A. I know him through his businesses
2 made about the City's interaction with their 2 pretty well in the downtown area. I haven't seen
3 business? 3 him in many years, since I've retired, and I don't
4 A. I don't have any direct personal 4 believe he's -- I believe he's in Miami now or is
5 knowledge, no. 5 from Miami and only comes here on occasion, I
6 Q. Did you encourage Mr. Melendez, instead 6 believe, to, you know, check on his businesses that
7 of opening a bar, to open an art gallery? 7 he still has here. I don't know which ones he
8 A. No. We don't advise -- it's not our 8 still has.
9 role to advise property owners or businesses about, 9 Q. Did his business have the same
10 you know, what kind of business they should 10 restrictions on it that Jim Brady and Victor
11 operate, only that they should operate within the 11 Melendez's did, or do you know?
12 laws governing any business. 12 A. He would have had to comply with
13 Q. Did you have anything to do with the 13 whatever the city and state building codes were,
14 City requirement for this business to put a 14 and zoning codes.
15 sprinkler system in for their fire protection? 15 Q. Did you intervene on his behalf so that
16 A. I was aware only that any business 16 he would have less responsibilities, like sprinkler
17 under certain conditions, under city code or state 17 systems, et cetera?
18 code, I'm not sure which, would be required to have 18 A. No. I don't have that authority or
19 a sprinkler system. It had to do with capacity or 19 knowledge.
20 something, but it was not the area of my or DRC's 20 Q. Are you aware of news reports by ABC
21 responsibility or expertise. 21 News, local channel, reporting that the bars were
22 Q. Do you know whether or not any other 22 being forced to shut down in the Superblock?
23 business that opened during this time period was 23 A. Say that question again.
24 required to install such a sprinkler system? 24 Q. Okay. Are you aware of news reporting
25 A. I believe that that happened in other 25 by ABC News that bars were being forced to shut
Page 43 Page 45
1 locations within the DRC district and probably the 1 down in the Superblock area?
2 City, but I couldn't name those for you. 2 A. I guess I don't have any direct
3 Q. Okay. Have you ever heard of a place 3 knowledge of ABC News reports.
4 named The Chemist? 4 Q. Do you remember a December article, 5
5 A. Yes. 5 December article in The Sun News that indicated
6 Q. What is that? 6 that Superblock owners were being targeted for
7 A. It's a restaurant on 9th Avenue in the 7 closing?
8 downtown district. 8 A. I don't recall. I don't have any
9 Q. Is it a restaurant or a bar? 9 knowledge about that kind of thing.
10 A. I believe it was a restaurant that also 10 Q. Did you have anything to do with
11 served alcoholic beverages. It had a liquor 11 revocation of Pure Ultra Club's liquor license?
12 license. 12 A. No.
13 Q. Do you know the owner of The Chemist? 13 Q. Did you know about it?
14 A. Yes, I do. 14 A. I'm sure I ultimately heard about it at
15 Q. What's your relationship with the owner 15 some point because it was a business within the DRC
16 of The Chemist? 16 district, but it's not our area of responsibility.
17 A. He's an owner of several -- was an 17 Q. Was it common knowledge and openly
18 owner, I don't know if he is still -- was an owner 18 discussed that the City wanted to end some business
19 of several restaurants, businesses in the downtown 19 activity in the Superblock, especially bars and
20 area. 20 nightclubs?
21 Q. What's his name? 21 MR. CONNOR: Object to the form.
22 A. Geesh, I'm drawing a blank right now. 22 THE WITNESS: I'm not sure what you
23 I'm just drawing a blank. 23 mean by "common knowledge." I don't know what that
24 Q. What kind of relationship did you have 24 means.
25 with the owner? 25 BY MR. BRITTAIN:
12 (Pages 42 - 45)
Page 46 Page 48
1 Q. Well, I mean -- let me be a little more 1 The first one I want to look at is 33731. That's
2 specific. 2 an email from you --
3 I mean, I've got your emails back and 3 A. Okay.
4 forth with Pedersen. I'm getting ready to go 4 Q. -- to staff, Martino, and carbon copy
5 through them with you. 5 or copy to John Pedersen.
6 So what I'm asking is -- here's what it 6 (EXHIBIT 1, Email from David Sebok,
7 looks like to me, and if it's not, you just tell 7 Bates labeled 33731, was marked for
8 me, that for whatever reason, and maybe they're 8 identification.)
9 good reasons, you know, there seemed to be an 9 BY MR. BRITTAIN:
10 effort to get rid of the bars and put other 10 Q. But do you have that in front of you?
11 businesses in there, and I think it was openly 11 A. Yes.
12 discussed by the city council and the Redevelopment 12 Q. Okay. As I look at that document, I
13 Commission. I mean, that's my question to you. 13 come down to the second paragraph, and it says, You
14 Wasn't it the plan to have compatible 14 notice I get rid of all bars and bar potentials and
15 businesses with the Children's Museum, which meant 15 only those existing on Main Street remain, plus the
16 shutting down bars that were in close proximity? 16 vacant building at Oak Street. I would propose
17 MR. PLAYER: Object as to form. 17 that we zone them out entirely over time, offer
18 MR. CONNOR: Object as to form. 18 incentives to existing properties or new investors
19 THE WITNESS: I'm not aware of any such 19 to renovate or redevelop for suitable uses.
20 plan. 20 That's what you told them, right?
21 BY MR. BRITTAIN: 21 A. That's what I wrote.
22 Q. All right. Do you know who Sean and 22 Q. Okay. And then at the bottom --
23 Joseph Lowe are, L-o-w-e? 23 A. Sir, I mean, you really need to take
24 A. It doesn't ring a bell. 24 that into the context of the above paragraph where
25 Q. Okay. Brady claims that he had a new 25 the Children's Museum and Chapin Library both, but
Page 47 Page 49
1 tenant come in, Sean and Joseph Lowe, that were 1 particularly the Children's Museum, because of the
2 going to have some kind of family business, some 2 involvement of children as part of their business,
3 sort of family virtual reality business in his 3 that, you know, they were concerned about safety in
4 location, and that you told him it was not going to 4 the area and, you know, were there crime issues
5 happen. Is that true or not true? 5 within the area. So, you know, taking those into
6 A. Not true. I don't recall any such 6 consideration, I think they're related in that the
7 conversation like that. And I wouldn't have the 7 Children's Museum wanted to make sure that it was a
8 inclination or authority to say such a thing. 8 safe neighborhood.
9 Q. Would it be wrong of the City to try to 9 Q. And let me say I understand that
10 stop that particular contract? 10 completely.
11 MR. CONNOR: Object to the form. 11 A. Okay.
12 THE WITNESS: I don't have an opinion 12 Q. That's my point. That's the point I've
13 on that. That would be the area -- 13 been trying to make is, we can all argue later on
14 BY MR. BRITTAIN: 14 about whether it was right or wrong to do it, but
15 Q. You say you don't have an opinion. You 15 the truth is, because of what you thought you had
16 don't say one way or the other whether that's right 16 going in there, you were trying to get rid of the
17 or wrong? 17 bars.
18 A. Correct. 18 MR. CONNOR: Object to the form.
19 Q. Okay. All right. I've got here -- and 19 THE WITNESS: No, we weren't trying to
20 your very fine lawyer can help you with this. I 20 get rid of -- the DRC was not trying to get rid of
21 want to go over some documents with you -- 21 the bars. We were trying to, you know, make sure
22 A. Okay. 22 that -- again, it wasn't even our responsibility.
23 Q. -- that we've received, and here, 23 We only care about businesses that comply with the
24 again, give you a full chance to read them, look at 24 codes and the laws, you know, that they're entitled
25 them and make sure we're seeing them the same way. 25 to do business and that they do that. And if they
13 (Pages 46 - 49)
Page 50 Page 52
1 don't do that, then they could become a problem to 1 being in the proximity of these things, so if
2 adjacent businesses or property owners. 2 something was close to it, you'd have the same
3 BY MR. BRITTAIN: 3 concern, wouldn't you?
4 Q. Did you type the words, you notice I 4 MR. CONNOR: Object to the form.
5 get rid of all bars and bar potentials? 5 THE WITNESS: Not if they were
6 A. It appears that -- 6 operating under the laws of the city and safe.
7 MR. CONNOR: Object to the form. 7 BY MR. BRITTAIN:
8 THE WITNESS: But I believe I'm talking 8 Q. Let me move on to the next document,
9 those except for -- I'm talking about those within 9 which is 34188.
10 9th Avenue frontage and those fronting Nance Plaza 10 A. Okay.
11 which were within the footprint of the proposed 11 (EXHIBIT 2, Email from John Pedersen to
12 site. 12 David Sebok, Bates labeled 34188, was marked for
13 BY MR. BRITTAIN: 13 identification.)
14 Q. Well, so was -- so was -- Pure Luck 14 BY MR. BRITTAIN:
15 Club was very close to where you were going to put 15 Q. And this is an email from Pedersen to
16 the Children's Museum, wasn't it? 16 you. So you're the recipient of this email, based
17 MR. CONNOR: Object to the form. 17 on what I can see. And this says, Hector has
18 THE WITNESS: It was around the corner, 18 withdrawn his business license appeal, so we are
19 yes. That was not part of anything that we were 19 down to Natalie's. If Lauren can be ready to go,
20 involved in because it was not part of the 20 that would be good. This is progressing nicely.
21 footprint. 21 What is the status on Lizzie's work?
22 BY MR. BRITTAIN: 22 Now, do you know who he's referring to
23 Q. Well, I'm just asking you again. You 23 there when he says Hector?
24 know, we all make emails and we go back and look at 24 A. Mr. Melendez, I assume.
25 them. You don't dispute with me that in your 25 Q. Okay. So you and he were talking about
Page 51 Page 53
1 second paragraph -- you're talking to Martino. 1 and keeping up with Hector's business license
2 He's the councilman, right? 2 appeal?
3 A. Yes. 3 A. I wasn't keeping up with it. That's
4 Q. And that John Pedersen is on this 4 not an area of my responsibility or authority. He
5 email? 5 was just informing me of the status of that
6 A. Yes. 6 particular business license appeal in the first
7 Q. And you're the -- what is your 7 sentence. And then he, as we acquired properties,
8 position? Are you the chairman of the 8 Natalia's was within the footprint, and when we
9 Redevelopment Commission? What was your title 9 acquired properties, then we'd help tenants remove
10 there? 10 their personal possessions and equipment and then
11 A. I was the executive director. 11 secure the property. And that's what he's
12 Q. Executive director. And it says 12 referring to, to have Lauren be ready to go. We
13 here -- 13 did that for all properties within the footprint.
14 A. Go ahead. 14 Q. Okay. Well, here's what -- okay. Go
15 Q. Okay. It says here in the second 15 ahead. I'm sorry. Don't let me cut you off. I
16 paragraph, You notice I get rid of all bars and bar 16 apologize.
17 potentials. 17 A. And then I'm just describing -- there's
18 MR. CONNOR: Object to the form. 18 several points in that one paragraph, was that
19 THE WITNESS: I believe that I was 19 Lizzie was, you know, doing her preliminary design
20 referring to the footprint of the proposed site 20 for the Chapin Library/Children's Museum, you know,
21 only. Only the footprint. 21 to be on the footprint of the site.
22 BY MR. BRITTAIN: 22 Q. Well, he's not informing you just for
23 Q. Why would you just care about the 23 the fun of it, is he?
24 proposed site? If you care about -- right down 24 MR. CONNOR: Object to the form.
25 here lower, it says you're worrying about kids 25 BY MR. BRITTAIN:
14 (Pages 50 - 53)
Page 54 Page 56
1 Q. I mean, he's got a role to play? 1 Q. Did your corporation ever redevelop a
2 MR. CONNOR: Object to the form. 2 single piece of property down there in the
3 THE WITNESS: The only role that I had 3 Superblock?
4 to play was to acquire the authorized site for the 4 A. No. That was not how we approached
5 project. 5 getting redevelopment to occur. We provided
6 BY MR. BRITTAIN: 6 incentives and, you know, in some cases marketing,
7 Q. So you don't dispute receiving these 7 access to websites that we might have, and
8 words, Hector has withdrawn his business license 8 materials to help promote their businesses.
9 appeal? 9 Q. So how did that work out? I mean, what
10 A. Well, it's there. He was informing me 10 changed down there? What change have you brought
11 and apparently others about the status of a 11 down there?
12 particular property or business within the DRC 12 MR. CONNOR: Object to the form.
13 district. 13 THE WITNESS: Are you talking about the
14 Q. Okay. And once that business appeal is 14 Superblock?
15 terminated, that creates a different situation for 15 BY MR. BRITTAIN:
16 that business, correct? 16 Q. Yeah.
17 MR. CONNOR: Object to the form. 17 A. Some businesses did take advantage of
18 THE WITNESS: I don't know what that 18 that storefront loan program that I mentioned to
19 creates for the business. 19 you and had renovated their facilities.
20 BY MR. BRITTAIN: 20 Q. But that was years ago. That was years
21 Q. Well, if you don't have a business 21 ago, right?
22 license, that property is not worth as much money; 22 MR. CONNOR: Object to the form.
23 isn't that true? 23 THE WITNESS: It was earlier than this
24 MR. CONNOR: Object to the form. 24 particular project, yes.
25 THE WITNESS: I wouldn't be an expert 25 BY MR. BRITTAIN:
Page 55 Page 57
1 in that. 1 Q. Right.
2 BY MR. BRITTAIN: 2 What I'm asking you is, what has your
3 Q. You don't know whether or not when a 3 corporation, quote, redeveloped in the Superblock
4 business loses its license, it's worth less? 4 area, you know, as far as this process, 2014 to
5 MR. CONNOR: Object to the form. 5 2020?
6 THE WITNESS: I don't -- that's not my 6 A. We don't do redevelopment. We
7 area of expertise. 7 encourage and facilitate private redevelopment.
8 BY MR. BRITTAIN: 8 Q. So what event has happened?
9 Q. So we, that's we, I guess that means 9 A. Say that again.
10 you and him, right? He says, We are down to 10 Q. What private redevelopment has happened
11 Natalie. 11 that you encouraged?
12 MR. CONNOR: Object to the form. 12 A. In the Superblock area?
13 THE WITNESS: And your question is? 13 Q. Yeah.
14 BY MR. BRITTAIN: 14 A. Well, there were some new businesses
15 Q. Is that what he meant? Is that what 15 that came into the area that weren't there
16 you take him to mean, so we are down to Natalie's? 16 originally in 1999. It was the 90s or 2000 even,
17 A. I don't know what he was really 17 there were some businesses that came and some that
18 referring to in terms of Natalia's. It's 18 went. It's just a natural thing.
19 Natalia's. 19 Q. I'm talking about 2014 to the present.
20 Q. Okay. Natalia's. 20 A. I don't know.
21 What did you understand her situation 21 Q. I mean, the truth of it is, there's not
22 to be at this time? 22 one single one that any private person has
23 A. I think she was, as a business, having 23 redeveloped or that the Redevelopment Corporation
24 some police and code issues with the City, but I 24 has redeveloped; isn't that true?
25 don't know specifically what those were. 25 MR. CONNOR: Object to the form.
15 (Pages 54 - 57)
Page 58 Page 60
1 THE WITNESS: I can't respond to that. 1 the document here. It's 31637. They've got four
2 BY MR. BRITTAIN: 2 projects they're working on for you. It looks like
3 Q. Well, you can't give me one. And you 3 y'all are going to buy some of these properties and
4 were executive director of the Redevelopment 4 hold them. You're trying to keep people from
5 Corporation, right? 5 knowing that they're being sold so the price will
6 MR. CONNOR: Object to the form. 6 stay down. I mean, that's all here in these
7 THE WITNESS: I'm having difficulty 7 documents. I'm just wondering if any of that ever
8 understanding your question. 8 happened.
10 Q. Okay. Well, here's what I'm trying to 10 THE WITNESS: Well, in terms of the
11 ask you. It's pretty simple. 11 Superblock, clearly that project never happened.
12 You are executive director of the 12 The redevelopment of the properties were acquired
13 Redevelopment Corporation 2014 until you retired, 13 up to some point. I don't know the status of that.
14 correct? 14 BY MR. BRITTAIN:
15 A. Yes. 15 Q. But all that would have been prior to
16 Q. All right. What property in the 16 2014?
17 Superblock area was either redeveloped by private 17 A. No. Including now. I don't know, you
18 enterprise, with you helping them with your 18 know, what redevelopment is occurring or not
19 marketing and encouragement and all that, or by the 19 occurring in the Superblock area.
20 Redevelopment Corporation? What property down 20 Q. But as we sit here today, you don't
21 there has been redeveloped? 21 know? You were chairman of the Redevelopment
22 A. I'm not -- in terms of redevelopment, I 22 Corporation. You don't know and you can't give me
23 mean, there were some new tenants from time to time 23 a property that fits that question.
24 that came and went, but I'm not aware of any 24 MR. CONNOR: Object to the form.
25 redevelopment per se that occurred privately or 25 THE WITNESS: The only -- you know, I'm
Page 59 Page 61
1 publicly. 1 having trouble, sir, with your definition of
2 Q. Okay. And that's what you called your 2 redevelopment, or lack of a definition.
3 corporation? 3 BY MR. BRITTAIN:
4 A. Right. 4 Q. Use yours. Use yours. Use your
5 Q. And that's what you called your 5 definition.
6 corporation, right? It was Redevelopment 6 A. Redevelopment can also just mean, you
7 Corporation? 7 know, business events or vacant buildings that are
8 A. Right. And redevelopment is a process 8 owned by somebody that get a successful tenant in
9 that in most cases takes a lot of time and a lot of 9 there and create an activity and provide services
10 parties and creativity in order for that to be 10 and goods to consumers. That's also redevelopment.
11 accomplished in the Superblock area. And the whole 11 It is not only just acquiring certain properties or
12 downtown for that matter. It has really been a 12 somebody demolishing an old building that's, you
13 process over a long period of time. 13 know, outlived its useful life and then building
14 Q. But you don't have one to point to in 14 something new on that property. It's a very
15 the Superblock area? 15 complex, varied definition of redevelopment.
16 A. When you say "redevelopment," what is 16 Q. I understand that. I really do. I
17 your definition of redevelopment? 17 know it's not just rebuilding.
18 Q. Well, I'm just going with what y'all 18 So can you give me a property where
19 are doing. I'm looking here at this agreement you 19 that has occurred down there, the broadest
20 had with Metro Properties. It says, you know, 20 definition you've got from 2014 until 2020.
21 that -- they talk about how the money is going to 21 A. I'm not aware of any that I can think
22 be reimbursed and, you know, what the fee is going 22 of off the top of my head.
23 to be and they're going to do research. It looks 23 Q. That's what I thought. Let's look at
24 like y'all might buy some of the properties and 24 document 31637. And this looks like a proposal for
25 hold them. I mean, I don't know. I'm just reading 25 services on Metro Properties Group, LLC.
16 (Pages 58 - 61)
Page 62 Page 64
1 A. Tell me the number again. 1 to the City.
2 Q. It's 31637. Okay. 2 BY MR. BRITTAIN:
3 I've referred to two documents. We'll 3 Q. But that was going to involve actually
4 make this one 3. 4 buying businesses in the area, correct?
5 (EXHIBIT 3, Proposal for Services, 5 MR. CONNOR: Object to the form.
6 Bates labeled 31637, was marked for 6 THE WITNESS: We were buying property
7 identification.) 7 in the area.
8 BY MR. BRITTAIN: 8 BY MR. BRITTAIN:
9 Q. Mr. Sebok, I'm looking at this. It 9 Q. Property. Buying properties in the
10 claims to be a proposal for services addressed to 10 area?
11 you from Scott Taylor. 11 A. Within the footprint.
12 Have you got a copy of it? 12 Q. Okay. Under Project B, the second
13 A. Yes. 13 paragraph, Property owners will be confidentially
14 Q. Okay. And I have -- see a little 14 contacted and engaged in communication regarding
15 insignia there on the left. It says Metro 15 the sale of their property at prices agreed to by
16 Properties Group, LLC. It indicates this is a fee 16 client. Properties will be contracted for purchase
17 proposal that he's submitting to you; is that 17 and assigned to client at an agreed-upon time,
18 correct? 18 correct?
19 A. Yes. 19 A. That's what it says. Project B was not
20 Q. Now, look at the second paragraph under 20 the Superblock.
21 something called Project A, and let's read that 21 Q. Okay. But what you had here was a
22 together. My copy be says, Upon direction of 22 significant relationship with Scott Taylor and his
23 client. Now, was the City of Myrtle Beach your 23 company. He had a lot of responsibility to
24 client or was the Redevelopment Corporation your 24 complete things pursuant to this contract. That's
25 client? 25 true, isn't it?
Page 63 Page 65
1 A. I'm not sure of the definition of 1 MR. CONNOR: Object to the form.
2 client in this context here. Certainly the DRC was 2 THE WITNESS: He had contractural
3 acting on behalf of the City in engaging Metro 3 obligations. I don't know if I would say it was a
4 Properties to acquire these properties, so the 4 lot of responsibility.
5 ultimate client was the City. 5 BY MR. BRITTAIN:
6 Q. Well, I thought you said you weren't in 6 Q. They're right here on this document,
7 the business of acquiring any properties? 7 right?
8 A. We weren't ever in a position prior to 8 MR. CONNOR: Object to the form.
9 this to do so, nor did we have an opportunity. We 9 THE WITNESS: I'm not sure what your
10 were doing this as a service to the City. 10 question is.
11 Q. The last sentence of that paragraph 11 BY MR. BRITTAIN:
12 says, Properties will be contracted for purchase 12 Q. Well, I mean, you don't dispute any of
13 and assigned to client in an agreed-upon time, six 13 the terms in this contract that we're looking at
14 to nine months, correct? 14 together, do you?
15 A. Yes. Well, in that context, I guess 15 MR. CONNOR: Object to the form.
16 the DRC is the client. 16 THE WITNESS: It's a contract. It says
17 Q. So what was going on here was Taylor 17 what it says.
18 was trying to buy properties for you, you would 18 BY MR. BRITTAIN:
19 have them, you'd buy them, correct? 19 Q. Right. And I look down here at the
20 MR. CONNOR: Object to the form. 20 bottom, I see a signature, what appears to be Brian
21 THE WITNESS: We were asked -- the DRC 21 Scott Taylor, and the words "agreed and accepted"
22 was asked by the City to assemble the sale for the 22 and that looks like your signature, September 12th,
23 redevelopment project, which this contract will 23 2016. So you signed it?
24 allow us to do, and then ultimately that site would 24 A. Yes, I did.
25 be, once assembled, turned over to the City -- sold 25 Q. Okay. Did you do that in your capacity
17 (Pages 62 - 65)
Page 66 Page 68
1 as executive director of the Downtown Redevelopment 1 service to any and all businesses and property
2 Corporation? 2 owners within the DRC district, as I mentioned
3 A. Yes. 3 before, and House Parts, that's Mr. Paulssen, his
4 Q. Okay. If you look with me on document 4 property was within the footprint of the proposed
5 32532. That's skipping over a few from what I sent 5 site, and for any business that was within the
6 to Andrew. 6 footprint of the site, proposed site, we offered to
7 MR. CONNOR: Okay. 7 help them relocate. And in this case,
8 THE WITNESS: 532? 8 Mr. Paulssen, we were aware that he was looking for
9 BY MR. BRITTAIN: 9 various -- prior to the project, looking for
10 Q. Yes, 532. 10 various opportunities to relocate his business to
11 A. Okay. 11 some other area because just for his own reasons.
12 Q. Okay. You've told me before that 12 And so we're just making a connection here,
13 Lauren Clever had a responsibility at the Downtown 13 providing information from one person to another.
14 Redevelopment Corporation. What was her job? 14 BY MR. BRITTAIN:
15 A. She was assistant executive director. 15 Q. Okay. If you'll go to No. 2536,
16 She was my assistant. 16 probably the next page --
17 Q. Okay. And this looks like an email 17 A. Okay.
18 from her to you sent back in June of 2017 saying, 18 Q. -- I'm going down to the bottom of it
19 Check out the property on 801 Broadway Street. 19 here. It looks like it's an email from you to John
20 Just got word from real estate connection it's 20 Pedersen and a bunch of other people, a large group
21 going to be on the market for 400,000, 8000 square 21 of people, and it says down here at the bottom,
22 feet. Thoughts for House Parts, corner lot, has 22 Coincidentally, Lauren had just come back from
23 parking and includes a vacant lot next to the 23 meeting with Mayor McDowell on this topic. We are
24 parking lot. Let me know if you want to connect 24 attempting to collect data as follows. And I have
25 with an agent. 25 copied people who may be able to contribute. The
Page 67 Page 69
1 Now, how close is that property to my 1 link is to our Dropbox which has a DRC boundary
2 client's property? Do you know? 2 map. It's too big to send by attachment.
3 A. I believe that this is describing 3 And then the next page, which is 537,
4 property at the corner of Main Street and Oak 4 has what appears to be a significant list of
5 Street, which is down the block away from -- and I 5 information that you're trying to gather and a
6 guess you're saying your client is Mr. Brady. 6 designation of people who will be responsible for
7 Q. Yeah. I notice his addresses are 803 7 it.
8 and 805. 8 Would you accept that as a description
9 A. Okay. 9 of this document?
10 Q. And I'm figuring 801 can't be that far 10 A. Yes.
11 away, but maybe you know. 11 Q. Okay.
12 A. Well, they're obviously on the same 12 A. That is typical for what we always did,
13 block. 13 was to try to assemble information to
14 Q. Yeah. My point is, y'all at least were 14 prospective -- make it available to prospective
15 interested in purchasing or arranging some sort of 15 investors, developers, businesses who were
16 transaction because she's telling you what the 16 interested in the DRC district. And this is a list
17 price is that she heard, how big it is, and she's 17 of typical and ordinary information that developers
18 talking about a potential owner House Parts. 18 or businesses look for. We often don't have this
19 My point is, that's the kind of thing 19 information readily available. It's not something
20 you were doing as part of redevelopment was trying 20 that's always available. So this is something that
21 to find out what's available, seeing what the price 21 we would normally do for anybody, if we could
22 was, and trying to find, you know, a purchaser to 22 collect this information because developers and
23 match up with it? 23 investors and businesses want this kind of
24 MR. CONNOR: Object to the form. 24 information when they're looking at, in this case,
25 THE WITNESS: We offered that kind of 25 downtown.
18 (Pages 66 - 69)
Page 70 Page 72
1 Q. And all of these people at least were 1 go-ahead and using the full power of the City and
2 requesting that Mayor McDowell, Chief Prott, Chris 2 its different departments in showing them the
3 Lee, Scott Taylor, do certain things to help you 3 Superblock? Who made the decision to use
4 complete what information you were trying to get. 4 police/fire department, construction services and
5 Mike Shelton. That's what they were doing. They 5 zoning in a coordinated effort to selectively
6 were going to go out and get you information that 6 enforce and discriminate against these merchants?
7 you were going to compile? 7 Were these not the very city services these
8 A. Well, we would request, you know, 8 merchants should have been able to depend upon for
9 certain information. Whether they could provide it 9 service and support?
10 or not, we didn't always know. Sometimes it was 10 Do you agree or disagree with those
11 information they could not readily retrieve or 11 assertions?
12 collect. Sometimes it was information that was 12 A. I would disagree. Disagree.
13 proprietary and not under state or local laws 13 Q. Okay. Did you receive this document?
14 available to be disseminated. And in some cases it 14 Did you ever see this document before today?
15 was information that, you know, not a high priority 15 A. I don't recall it, to tell you the
16 for them in the course of their business or their 16 truth.
17 work. 17 Q. Okay. Well, go back to the page
18 Q. But you were at least consulting them 18 beforehand, which is 396.
19 to see if they could help you get this information? 19 A. Okay.
20 A. Correct. 20 Q. And it looks like the second entry on
21 Q. Okay. If you would go with me to page, 21 it is from Pedersen to you saying, I saw it. He's
22 the No. 3397, 397. It's a long, single-spaced 22 stuck on Fantasy Island again. The plane, the
23 letter it looks like, probably an email from David 23 plane.
24 Phillips with a byline of Myrtle Beach South 24 And my understanding was was that that
25 Carolina News, Myrtle Beach Daily News, 25 was his reference to you about this information
Page 71 Page 73
1 MyrtleBeachSC.com. 1 from David Hucks. Is that true or not true?
2 A. Okay. 2 A. God, I don't know.
3 Q. Do you have a copy of that? 3 Q. You don't remember?
4 A. Yes. 4 A. I don't remember.
5 Q. Okay. Look with me at item 6. Item 5 Q. Okay. Up there above that there's an
6 six says, Several owners have approached the DRC 6 email from you to John Pedersen saying you agree.
7 and the City in the past year trying to sell their 7 Do you see that?
8 properties for redevelopment. We have zero 8 A. Yes.
9 interest from DRC and the City from certain owners. 9 Q. Okay. And it looks like, based on the
10 We have confirmed mean-spirited responses from the 10 time, yours is at 6:05 and his is at 6:34.
11 City as well as Chuck Martino and David Sebok. No 11 So do you agree with me that this is an
12 efforts were made by the City nor DRC to connect 12 email from John Pedersen to you and you're agreeing
13 these Superblock owners to potential investors. 13 with it?
14 What has changed that the City is suddenly 14 MR. CONNOR: Object to the form.
15 interested in shutting down the Superblock and 15 THE WITNESS: It appears that I'm
16 buying? 16 agreeing with John Pedersen's statement that he's
17 Now, I'm assuming you say those things 17 stuck on Fantasy Island again, whatever that means.
18 aren't true? 18 BY MR. BRITTAIN:
19 MR. CONNOR: Object to the form. 19 Q. So you --
20 BY MR. BRITTAIN: 20 A. Mr. Hucks was a reporter, I believe.
21 Q. Well, maybe you think they are true. I 21 Q. Yes. Yes. Yes.
22 mean, are they true or not true? 22 And all I'm asking you is whether or
23 A. No, they're not true. 23 not that exchange between you and Pedersen was
24 Q. Okay. No. 7 is, Who is ultimately 24 based on the information that I was reading out to
25 responsible in the city government for giving the 25 you with those various items of 6 and 7 from the
19 (Pages 70 - 73)
Page 74 Page 76
1 communication from Hucks or not. Maybe you know, 1 A. We never made an offer to my knowledge
2 maybe you don't. 2 to buy the Oasis.
3 A. I really don't know. 3 Q. Did you discuss purchasing the Oasis?
4 Q. Okay. Can you think of anything else 4 A. I don't recall ever discussing
5 your exchange with Pedersen would have been about? 5 purchasing the Oasis.
6 A. I'm sorry, say that again. 6 Q. On Document 544, which is the next one,
7 Q. Can you think of any other event that 7 this is an email from you to John Pedersen. I'm
8 you and Pedersen would have had this exchange over? 8 going down to the second email. It says, See
9 A. No, I can't think of -- I just can't 9 attached. And I have prepared for DRC executive
10 think of what was involved here. 10 session and for council executive session if you
11 Q. Fine. Okay, sir. 11 desire.
12 If you look at -- 12 Now executive session, that keeps the
13 A. It's a reporter's opinion. It's John 13 public and the press out, right?
14 Pedersen's opinion. 14 A. Yes.
15 Q. I understand. 15 Q. Very good. Okay.
16 Look at page 413. 16 And it goes on, I have this on the
17 A. Okay. 17 board that perhaps don't want hanging around to
18 Q. This looks like it's the next day. The 18 this week outside. ES -- I'm assuming that's
19 other stuff happened on the 22nd of January. This 19 executive session?
20 is on the 23rd. And this appears to be, at the 20 A. I think so.
21 very top of the page, appears to be an email from 21 Q. Let me know if you have any questions,
22 you to John Pedersen. 22 wanting something changed.
23 A. Okay. 23 So what did you have on the board?
24 Q. Yes, but I doubt that will stop his 24 A. It was a map of the proposed
25 ongoing persistence with untrue and unfounded 25 redevelopment site, and if my recollection serves
Page 75 Page 77
1 conspiracy theories. 1 me, it was color-coded to show the status of which
2 A. And your question is? 2 properties had been already acquired and in control
3 Q. Is that referring to David Hucks's 3 of the DRC on behalf of the City, which properties
4 communication? 4 there was a pending offer, and which properties
5 A. I believe so. 5 were still in negotiation.
6 Q. And before you wrote that email, 6 Q. So am I to understand that you're
7 there's one below that from John Pedersen that 7 actively purchasing properties at this time?
8 says, Is he ever going to be disappointed tomorrow, 8 A. As of January 3rd, 2017, yes.
9 with exclamation point. 9 Q. Okay. Which properties had you
10 What is he referring to? 10 acquired?
11 A. I believe that John is referring to -- 11 A. I don't recall.
12 let's see, this was January 23, 2017. I believe 12 Q. What happened to them?
13 that there was perhaps a scheduled press conference 13 A. Properties that the DRC acquired, if
14 or public announcement by the City to describe and 14 there was a tenant there, or even if there wasn't a
15 present to the public the proposed Chapin 15 tenant there, we allowed the property owner or
16 Library/Children's Museum redevelopment project. 16 business tenant to remove whatever possessions they
17 Q. All right, sir. Look at the next page, 17 wanted to. We secured the building and we provided
18 if you would, it's 3414. 18 a lock box for the police and fire department, so
19 A. Okay. 19 that during an emergency, they could gain access to
20 Q. This, here again, appears to be 20 the building. And that's all we did is we just
21 something from David Hucks. He says in the second 21 acquired them and secured them and allowed any
22 paragraph that he currently has an offer from the 22 property to be removed, personal property.
23 DRC to sell the Oasis. 23 Q. Now, does the DRC or the City now have
24 Are you aware of whether DRC ever 24 deed and title to some of these properties in the
25 offered to buy the Oasis Hotel? 25 Superblock area?
20 (Pages 74 - 77)
Page 78 Page 80
1 A. I think we did when I left, when I 1 reasonable expenditure of public monies.
2 retired. I don't know if they do now. 2 Q. But what -- what --
3 Q. So when you retired as part of this 3 A. And subsequently that property was
4 process, did the City or the Redevelopment 4 deleted from the footprint because it was on the
5 Corporation actually had purchased and had deed and 5 corner separated by an alleyway.
6 title to certain properties in the Superblock area? 6 Q. I'm sorry. What does the phrase
7 A. Only those properties that we 7 "strong council action" mean?
8 successfully acquired within the footprint of the 8 A. It means they would have to consider
9 redevelopment site, yes. 9 whatever they could do to approve an increased
10 Q. And you can't remember what those 10 offer, you know, if they wanted to.
11 properties were? 11 Q. All right.
12 A. No. It changed from week to week, 12 A. Because we were operating and making
13 month to month depending on which properties closed 13 offers based upon, because it was public money
14 when. 14 involved here, reasonable estimated value of
15 Q. Did you -- as part of the Redevelopment 15 property, and we were authorized to go to
16 Corporation, were you a part of selling any of 16 30 percent over, you know, an appraised value or an
17 those properties to another owner, subsequent 17 estimated value, but beyond that, then council
18 owner? 18 would have to give further direction.
19 A. No. 19 Q. Good.
20 Q. Okay. On page 545, Bates stamped 545, 20 Page 713.
21 I go down to the bottom, what this looks like is 21 MR. CONNOR: Tommy, is this a good time
22 sort of a tally of, quote, what's been going on as 22 to take a really important break?
23 of 1-10-17. And at the top it says, Total under 23 MR. BRITTAIN: I've got about five more
24 contract, $2,465,000. 24 minutes. I'm going through these documents, and
25 So what does that mean? 25 I'm getting near the end, so it won't be long.
Page 79 Page 81
1 A. That means that there was a contract 1 MR. CONNOR: All right. Go ahead.
2 to -- agreed-upon contract between the seller and 2 MR. BRITTAIN: Okay.
3 the buyer, in this case Metro Properties, to 3 BY MR. BRITTAIN:
4 acquire that amount of property for that price, but 4 Q. On 713, there's an email from Karen
5 they would not necessarily have gone to closing 5 Coltrane. What is Karen Coltrane?
6 yet. 6 A. She was the executive director of the
7 Q. Okay. And then the next starred point 7 Children's Museum EdVenture.
8 is Favorable negotiations, 600,000. 8 Q. Okay. And this email to you, she
9 So what is that? 9 said there's an exchange between her and Melody
10 A. Again, that's a list of properties just 10 Breeden regarding the Children's Museum of South
11 indicating that negotiations were ongoing and they 11 Carolina, interested in knowing the proposed
12 were looking positive, but, again, there was no 12 location. Thank you for assistance with this, for
13 contract in hand. 13 all you're doing to help the EdVenture come to
14 Q. Okay. Down at the bottom, 14 Myrtle Beach, correct?
15 next-to-the-last paragraph, it says, Hobeika is way 15 A. Yes.
16 out of line with their asking price and may require 16 Q. Now, the second one here is -- you have
17 strong council action. 17 to help me. It looks to me like it's from her,
18 What does that mean? 18 too, but it says, I can understand curiosity
19 A. It just means he was just asking for 19 regarding potential locations. I've spoken with
20 exorbitant pricing that couldn't be justified and 20 David Sebok this morning. He confirmed with John
21 if that particular property was to be -- remained 21 Pedersen that neither of them have related
22 included, it required that city council would have 22 information to anyone regarding the potential site.
23 to consider increasing their purchase offer or 23 They continue to ask to share the proposed location
24 whatever action the city council could do. But it 24 as they are currently in negotiations with property
25 was just way out of line of what we felt was a 25 owner. The only reason I'm even aware of the
21 (Pages 78 - 81)
Page 82 Page 84
1 location myself is because city officials wanted to 1 to assemble properties?
2 make certain that it would be suitable to EdVenture 2 MR. CONNOR: Object to the form.
3 as a satellite location. We've fully put effort 3 THE WITNESS: It's common practice
4 and resources into obtaining it. I can assure you 4 publicly and privately to keep assemblage of sites
5 that as soon as the City tells me they have secured 5 for redevelopment or whatever purposes confidential
6 a location for EdVenture, this one or another, if 6 until those sites are all assembled that meet the
7 this falls through, the first call I make will be 7 needs of, let's just say a developer, in this case
8 to you. But I feel strongly that I must honor both 8 the City, and that's to, you know, get them at the
9 the mayor and John Pedersen's request of me to 9 most reasonable fair price.
10 maintain confidentiality. 10 BY MR. BRITTAIN:
11 So it sounds to me like y'all had 11 Q. I understand. I think we agree on
12 agreed to keep this potential location secret; is 12 that.
13 that true? 13 Now you're in a public sector here. No
14 MR. CONNOR: Object to the form. 14 question about that, right? Your activities in
15 THE WITNESS: It's very typical with 15 this area are public sector activities?
16 anybody, whether privately or publicly, when you're 16 A. Yes.
17 trying to assemble a site involving multiple, you 17 MR. CONNOR: Object to the form.
18 know, properties that you pursue that acquisition 18 THE WITNESS: Well, we're part of the
19 process in confidence or -- you know, you used the 19 public sector, yes.
20 word "secret," but pursue it confidentially to 20 BY MR. BRITTAIN:
21 prevent unnecessary or unreasonable speculation, 21 Q. Okay. All right. Right at the end
22 price gouging and those kinds of things, which can 22 here, I'm just going to ask you to identify two
23 happen both publicly and privately. 23 other documents.
24 And so, yes, we were -- because, again, 24 Document 870 is a letter again from
25 they were public monies, we wanted to expend them, 25 Metro Properties Group, LLC.
Page 83 Page 85
1 you know, properly and in good faith. It's the 1 A. Wait a minute.
2 taxpayers, so that we didn't want speculation to 2 Q. Okay.
3 occur, which can happen. 3 A. Got it.
4 BY MR. BRITTAIN: 4 Q. That letter -- you're welcome to review
5 Q. And that was -- because the people 5 it and read it all over. I'm not going to go
6 might -- that might increase the value of their 6 through it with you. Carbon copies go to John
7 property, if they don't know that something nice 7 Pedersen and Chuck Martino, Lauren Clever, Jim
8 and big is going in there, that makes it a better 8 McCracken, and Buddy Hucks, and that letter is
9 negotiating situation for whoever is trying to buy 9 signed by Scott Taylor. And the last sentence in
10 it; isn't that correct? 10 that document, which is the second page, it's 871,
11 MR. CONNOR: Object to the form. 11 says it has and continues to be an honor to
12 THE WITNESS: You'd have to ask that 12 continue to represent the City and their interests
13 question again. 13 in DRC's district redevelopment goals, which is an
14 BY MR. BRITTAIN: 14 accurate statement, isn't it?
15 Q. Okay. What I thought I heard you 15 MR. CONNOR: Object to the form.
16 explaining was, it's normal practice when you've 16 THE WITNESS: You'd have to ask
17 got a significant owner coming in or tenant coming 17 Mr. Taylor if he feels it's an honor.
18 in, you try to keep that quiet from the adjoining 18 BY MR. BRITTAIN:
19 properties because, once they find that out, they 19 Q. Okay. But he was representing -- I
20 may be trying to get more money for their 20 understand -- no, I don't ask you to do the honor
21 properties than if they don't know about it. I'm 21 part, but what he says is he's representing the
22 not saying there's anything wrong with that. I'm 22 City and their interests in the DRC district
23 just saying, isn't that -- the theory behind it is 23 redevelopment goals. Was that part of the sentence
24 to keep that information close so the property 24 true?
25 values won't inordinately go up when you're trying 25 MR. CONNOR: Object to the form.
22 (Pages 82 - 85)
Page 86 Page 88
1 THE WITNESS: He's -- with regard to 1 purchased in the Superblock to anybody?
2 the contract between Metro and the DRC and these 2 A. We did lease back to an existing
3 projects, this letter is talking about Project B, 3 tenant, who was still operating on 9th Avenue,
4 which is unrelated to the Superblock. What he says 4 because they had acquired a new space on 9th Avenue
5 represents the City and their interest in DRC. I 5 further downtown, and they were renovating that
6 think he's really -- I think he's misstating 6 space to make it -- for them to relocate their
7 "representing the City." He's representing the DRC 7 business but they weren't ready yet, so we leased
8 and probably saying that the City -- you know, the 8 that back to them for, I believe it was either
9 DRC is doing the City's redevelopment work with 9 under the existing terms of their lease with the
10 regard to the pavilion area master plan, Project B. 10 original owner or a reduced rate. I can't
11 MR. PLAYER: Let's take the break. 11 remember.
12 MR. CONNOR: All right. We'll take a 12 Q. And are those the folks that the DRC --
13 short break to see if he can get back on. 13 there was a property that was purchased for a
14 (A recess transpired.) 14 minimal amount and then sold for -- or vice versa.
15 MR. BRITTAIN: Hey, I'm back. I've got 15 There was a property where there was $250,000 that
16 one more question. 16 was in the press that it was undersold, but a
17 BY MR. BRITTAIN: 17 tenant had made renovations to the space and that's
18 Q. If you'll go to page 922, this appears 18 what the additional money was for? Do you recall
19 to be a document from E.F. Hucks Consulting, LLC, 19 that at all?
20 making a proposal for services to you, Mr. Sebok, 20 A. I don't remember -- recall the details.
21 and it's got Project A, Project B, Project C. On 21 The tenant that was going to move into a new space
22 the second page, it's got Projects A and B, 22 that they had leased wanted to have further
23 retainer, and it's got some terms. And I see 23 assistance from the City in its relocation to that
24 Buddy's signature on this document. On the one I 24 space and/or compensation for leaving the space
25 have, I do not have your signature. 25 that they had made some improvements to. And that
Page 87 Page 89
1 Do you know whether or not that 1 was decreeing the City and that tenant, and John
2 proposal was accepted by the Redevelopment 2 Pedersen was the primary person dealing with that
3 Corporation? 3 tenant in terms of trying to reach agreement.
4 A. It was not. 4 Q. But wasn't that property purchased by
5 Q. Okay. I have no further questions. 5 the DRC?
6 MR. PLAYER: I've got a couple follow 6 A. Yes, it was purchased by the DRC and it
7 ups, if that's okay. Andrew? 7 had an existing tenant who had an existing lease,
8 MR. CONNOR: Yes. You've got some 8 which we were to honor and -- you know, but then
9 follow ups, Mr. Player? 9 that person had indicated that they were going to
10 MR. PLAYER: Yeah. 10 move to a new location which they felt was -- down
11 MR. CONNOR: Okay. Go ahead. 11 the street, down on 9th Avenue, and they were
12 EXAMINATION 12 seeking compensation for vacating the property that
13 BY MR. PLAYER: 13 we had acquired beyond, you know, beyond that which
14 Q. Mr. Sebok, my name is Tucker Player. I 14 DRC was allowed to do.
15 represent plaintiffs as well. I just had a couple 15 Q. Okay. I want to go back to the
16 questions. 16 Document 545, that you had stated, I think, is way
17 You mentioned earlier about putting new 17 out of line on their asking price and may require
18 tenants in as part of the redevelopment? 18 strong council action.
19 A. You broke up there just a bit. 19 A. Okay.
20 Q. Sorry. Do you recall in your 20 Q. Do you see the top of that?
21 deposition discussing finding new tenants for 21 MR. CONNOR: What are the rest of the
22 spaces that were targeted by the DRC? 22 digits so I can find it?
23 A. I'm sorry, say it again one more time. 23 MR. PLAYER: It's 33545.
24 Q. I'll make it simpler. 24 THE WITNESS: It's in Document 545 you
25 Did the DRC lease other spaces they had 25 said?
23 (Pages 86 - 89)
Page 90 Page 92
1 MR. PLAYER: Yes, sir. Right in the 1 board shortly after.
2 middle, a little bit towards the back. 2 Q. Do you know if the DRC ever made an
3 THE WITNESS: Well, my documents are 3 offer to any of his properties on 7th Avenue, in
4 now out of order. Hold on. 4 that area?
5 MR. BRITTAIN: It's right before you 5 A. I'm not aware of any offers by DRC to
6 get to the plats and the drawings. 6 buy any of his properties.
7 THE WITNESS: Okay. Hold on. Okay. 7 Q. In the contract with Metro Properties,
8 Got there. 8 it discusses Plan A, Plan B and Plan C. Can you
9 BY MR. PLAYER: 9 delineate what areas of the city those separate
10 Q. If you check from the bottom about 10 plans were?
11 Hobeika or Hobeika, however he pronounces it, and 11 A. Project A referred to the Children's
12 specifically, may require strong council action. 12 Museum/Chapin Library, a project in the Superblock.
13 Was that not a reference to eminent domain? 13 Project B referred to about, I think it
14 MR. CONNOR: Object to the form. 14 was five different hotel or vacant property
15 THE WITNESS: I don't recall. It -- I 15 locations along Ocean Boulevard, generally in the
16 don't recall. 16 south area, that we were trying to create
17 BY MR. PLAYER: 17 redevelopment opportunities for those property
18 Q. Do you recall that it was basically a 18 owners or for prospective developers. And -- so
19 month later that city council announced that it 19 Project B was to assemble some maps, some data that
20 would use eminent domain to take properties in the 20 might be in cooperation with the property owners
21 Superblock? 21 and their approval that could be presented to
22 MR. CONNOR: Object to the form. 22 developers if developers, you know, expressed an
23 THE WITNESS: I don't recall the timing 23 interest. It was primarily hotel-related.
24 of whatever the council did there. 24 Q. Right.
25 BY MR. PLAYER: 25 Would it be proper for a board member
Page 91 Page 93
1 Q. Do you know Noam Pyade? 1 of the DRC to use the information coming into the
2 A. Yes, I do. 2 DRC to purchase properties for themselves?
3 Q. How do you know him? 3 MR. CONNOR: Object to the form.
4 A. Is that in this document here? 4 THE WITNESS: The DRC did have a
5 Q. No. I'm just asking you if you know. 5 disclosure requirement as part of its bylaws, I
6 That's not in that document. 6 believe, that board members needed to disclose
7 I'm just asking you personally, how do 7 interest that they had in businesses or properties
8 you know Mr. Pyade? 8 within the district, and that if they were to seek
9 A. I believe that he is -- he bought some 9 to acquire a property or a business within the
10 properties along Ocean Boulevard in the downtown 10 district, that they were to inform the board of
11 area. I believe it's a motel. I can't remember 11 that and seek board approval and determination as
12 which. And he had other properties in the city or 12 to whether it was a conflict of interest or not.
13 downtown. He was a property owner/business 13 And then the board would decide on an individual
14 operator. 14 case by case whether there was a conflict of
15 Q. Was he not on the board of the DRC? 15 interest. Board members who did own property
16 MR. CONNOR: Object to the form. 16 within the district were advised to generally
17 THE WITNESS: He wasn't when I was 17 recuse themself from voting on any action that
18 there. 18 either had a direct or indirect or perceived impact
19 BY MR. PLAYER: 19 to their property, and they regularly did that.
20 Q. When did you leave? 20 BY MR. PLAYER:
21 A. January 31st -- I mean December 31st of 21 Q. Do you know if the DRC had, I guess,
22 2017. 22 any designation of properties to seek along 7th
23 Q. Okay. 23 Avenue North at all?
24 A. Well, I don't recall him being on the 24 A. There were -- no. The DRC -- okay. I
25 board when I was there. He may have been on the 25 think I know what you're talking about. But, no,
24 (Pages 90 - 93)
Page 94 Page 96
1 we had no interest in acquiring and being 1 Q. And how does that affect the property
2 landowners in any other -- in any area. We really 2 value of the surrounding properties?
3 didn't have the wherewithal to do that. Our role 3 A. It's called the broken window theory,
4 was to try to package potential redevelopment sites 4 where a blighted property would have a negative
5 information and make that available, basically 5 effect on adjacent properties.
6 create an opportunity between property owners and 6 Q. That's all the questions I have,
7 prospective developers or investors, for them, to 7 Mr. Sebok. Thank you.
8 see if there was an agreement they'd reach. 8 A. Okay.
9 The DRC, except for the role played 9 MR. BATTLE: This is Mike Battle. I do
10 with regard to the Superblock and the Children's 10 not have any questions. Thank you.
11 Museum and library, which was really as a 11 THE WITNESS: Okay.
12 pass-through, the DRC was not equipped to go out 12 MR. CONNOR: I don't have any questions
13 and just buy properties and hold them for 13 either.
14 redevelopment purposes or for -- 14 Electronic copy is fine for me.
15 Q. That kind of leads to my final area. 15 (The witness, after having been advised
16 Did DRC ever market any of the properties it 16 of his right to read and sign this transcript,
17 purchased in the Superblock for rent or renovation 17 waives that right.)
18 or to do anything with it except sit? 18 (The deposition was concluded at
19 A. The only rental that I recall was a 19 12:25 p.m.)
20 short-term rental, or whatever, for the one we were 20
21 talking about earlier, which I forget the name of 21
22 the people involved or the business even. 22
23 To my knowledge, while I was there, our 23
24 role was only to acquire and hold the properties 24
25 until the City was ready to redevelop them. 25
Page 95 Page 97
1 Q. What about maintenance? 1 CERTIFICATE OF REPORTER
2 A. We were responsible for securing the 2
3 properties, which we did. As I mentioned before, 3 I, Karen M. Ernst, Court Reporter and
4 we would request the fire department primarily and 4 Notary Public for the State of South Carolina at
5 the police secondarily, we installed what we would 5 Large, do hereby certify that the foregoing
6 transcript is a true, accurate, and complete
6 call, I guess, lock boxes, similar to what you do
7 record.
7 in residential houses, where there was a key in
8 I further certify that I am neither
8 there that the fire department and the police 9 related to nor counsel for any party to the cause
9 department could get to by entering a code, so that 10 pending or interested in the events thereof.
10 they could get into a building to protect it or do 11 Witness my hand, I have hereunto
11 whatever they needed to do. Other than that, 12 affixed my official seal this 3rd day of August,
12 that's all we basically -- we shut the utilities 13 2020, at Myrtle Beach, Horry County,
13 off, if there was no active tenants going on. It 14 South Carolina.
14 just secured the property. 15
15 Q. Okay. Do you know what neighborhood 16
16 blight is in a real estate context? 17
17 A. Yes. 18
19
18 Q. What is it?
20
19 A. Neighborhood blight is a common
21 <%21881,Signature%>
20 historical term used to describe an area or a 22
21 property that is by some standard deteriorated, 23 ________________________________
22 neglected, exceeded its useful life. And that's Karen M. Ernst
23 what it is. It's a property that is, you know, in 24 Court Reporter
24 tough shape and has been neglected or is not being My Commission expires
25 used at that time. 25 September 2, 2025
25 (Pages 94 - 97)
Page 98
1 INDEX
2 Page Line
3 DAVID SEBOK 3 8
4 EXAMINATION 3 10
5 BY MR. BRITTAIN
6 EXAMINATION 87 12
7 BY MR. PLAYER
8 CERTIFICATE OF REPORTER 97 1
9
10 REQUESTED INFORMATION INDEX
11 (No Information Requested)
12
13 EXHIBITS
14 Page Line
15 EXHIBIT 1, Email from David 48 6
16 Sebok, Bates labeled 33731
17 EXHIBIT 2, Email from John 52 11
18 Pedersen to David Sebok, Bates
19 labeled 34188
20 EXHIBIT 3, Proposal for 62 5
21 Services, Bates labeled 31637
22
23
24
25
26 (Page 98)
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8:6,18 9:21 10:18 396 72:18 843-853-5200 2:24 31:14 53:7,9
11:1 57:16 397 70:22 87 98:6 60:12 77:2,10,13
2010 11:1 38:25 3rd 77:8 97:12 870 84:24 77:21 78:8 88:4
39:13 4 871 85:10 89:13
2013 8:7 9:21 8th 33:11 acquiring 27:9
400,000 66:21
2014 10:19 17:15 32:8,10 61:11
413 74:16 9
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2017 33:3 66:18 82:18
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Federal Rules of Civil Procedure
Rule 30
(e) Review By the Witness; Changes.
(1) Review; Statement of Changes. On request by the
deponent or a party before the deposition is
completed, the deponent must be allowed 30 days
after being notified by the officer that the
transcript or recording is available in which:
(A) to review the transcript or recording; and
(B) if there are changes in form or substance, to
sign a statement listing the changes and the
reasons for making them.
(2) Changes Indicated in the Officer's Certificate.
The officer must note in the certificate prescribed
by Rule 30(f)(1) whether a review was requested
and, if so, must attach any changes the deponent
makes during the 30-day period.
DISCLAIMER: THE FOREGOING FEDERAL PROCEDURE RULES
ARE PROVIDED FOR INFORMATIONAL PURPOSES ONLY.
THE ABOVE RULES ARE CURRENT AS OF APRIL 1,
2019. PLEASE REFER TO THE APPLICABLE FEDERAL RULES
OF CIVIL PROCEDURE FOR UP-TO-DATE INFORMATION.

VERITEXT LEGAL SOLUTIONS
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Deposition of:

In the Matter of:

Brady, James v. City of Myrtle Beach,

A. William Roberts, Jr & Assoc.

1 UNITED STATES DISTRICT COURT

A. William Roberts, Jr & Assoc. 800-743-3376

& 2020 1:12 57:5 5 9:59 1:13

action 15:5,5 agreeable 36:24 appeal 52:18 53:2 64:4,7,10 68:11

assume 52:24 background 4:22 32:13 34:23 37:14 boundary 69:1

62:23 63:3,5,10 collect 68:24 complaint 29:21 connection 29:6

A. William Roberts, Jr & Assoc. 800-743-3376

consumers 61:10 corporate 15:22 course 4:3 30:18 decision 36:9,16

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entire 23:9 exorbitant 79:20 final 94:15 36:11,18 37:7,16

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legal 25:2,3 locations 43:1 manager 13:21 45:23 46:1,3,13

31:16 36:5,13 motel 91:11 natalie's 52:19 newsletter 11:22

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process 24:22 40:21,23 48:18 propose 18:3 pure 45:11 50:14

A. William Roberts, Jr & Assoc. 800-743-3376

responsibilities 90:1,5 92:24 scott 19:5,6,10,22 seek 18:1 37:2

shutting 46:16 sold 60:5 63:25 stamped 78:20 subsequently 80:3

A. William Roberts, Jr & Assoc. 800-743-3376

systems 44:17 35:4 47:1 61:8 thoughts 66:22 tried 35:9

u v wants 4:14 89:24 90:3,7,15

A. William Roberts, Jr & Assoc. 800-743-3376

(e) Review By the Witness; Changes.

(1) Review; Statement of Changes. On request by the

deponent or a party before the deposition is

completed, the deponent must be allowed 30 days

after being notified by the officer that the

transcript or recording is available in which:

(A) to review the transcript or recording; and

(B) if there are changes in form or substance, to

sign a statement listing the changes and the

reasons for making them.

(2) Changes Indicated in the Officer's Certificate.

The officer must note in the certificate prescribed

by Rule 30(f)(1) whether a review was requested

and, if so, must attach any changes the deponent

makes during the 30-day period.

DISCLAIMER: THE FOREGOING FEDERAL PROCEDURE RULES

ARE PROVIDED FOR INFORMATIONAL PURPOSES ONLY.

THE ABOVE RULES ARE CURRENT AS OF APRIL 1,

2019. PLEASE REFER TO THE APPLICABLE FEDERAL RULES

OF CIVIL PROCEDURE FOR UP-TO-DATE INFORMATION.

Veritext Legal Solutions represents that the

Veritext Legal Solutions is committed to maintaining

Veritext Legal Solutions complies with all federal and

Inquiries about Veritext Legal Solutions'

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