Riverhead board withdraws vote on hiring outside counsel for $40M EPCAL sale

Riverhead Town Board members withdrew a motion on Thursday to hire an outside law firm to advise them on the $40 million sale of more than 1,600 acres at the Enterprise Park at Calverton after some council members expressed reservations about the firm's experience.

The board was to vote at a special meeting to hire Garden City-based Stagg, Terenzi, Confusione & Wabnik, but some members had concerns about hiring the firm, including questions about how much experience it had with commercial litigation.

The board will instead have Town Attorney Bob Kozakiewicz vet a new list of law firms for the town to interview and choose from. Riverhead Supervisor Laura Jens-Smith said after the meeting that the town would also have Kozakiewicz's office invite Edmonton, Alberta, Canada-based developer Triple Five Group — a partner in the Calverton Aviation and Technology venture group buying the property — to a work session and await their response.

The venture group has until May 20 to decide whether to close on the deal as part of the contract’s first due-diligence period.

Board members began considering outside legal advice this month after learning that Luminati Aerospace LLC, a partner with Triple Five Group in the deal, was sued for defaulting on several conditions of a $10 million promissory note, and that Luminati is facing eviction from the building it leases at the EPCAL site for failing to pay rent to the property landlord. 

Luminati owner Daniel Preston has recently told media outlets that he intends to relocate his company to Little Falls in upstate New York.

Town Councilman Tim Hubbard said Thursday that while he favors seeking outside legal counsel if necessary, he had not been aware that the Garden City law firm was being considered and felt the board should select a firm with strong experience in commercial litigation. Hubbard — who said he turned down an offer from the venture group to meet with them privately last week — added he wanted to hear publicly from Calverton Aviation and Technology about how they are handling the situation with Preston.

“This board needs to hear from CAT," Hubbard said. "Not an individual . . . but this board, in a public venue, needs to hear from CAT. They need to come in here for a work session and tell us what is going on. How are they handling the situation with Daniel Preston? If Daniel Preston drops out of [the contract], that contract isn’t necessarily legit.”

Triple Five officials said in a statement Wednesday that Luminati remains a “minority, non-voting member of the venture group and is a 25 percent shareholder in the entity.”

Councilman Jim Wooten said he would like to meet with the venture group but would not support hiring outside counsel.

"I think we’re on the verge of something positive that’s going to happen up at EPCAL," Wooten said. "If it falls on its face, it’s going to be because of their doing, not because of our doing. I don’t even know why we’re even looking at a special counsel to look at a contract. I don’t understand it.”