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Sister in Joseph family auto company dispute asked jury for $30M -- here's what she got

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Posted at 1:36 PM, Oct 25, 2018
and last updated 2018-10-25 13:56:21-04

CINCINNATI -- A jury sided with Joseph Auto Group CEO Ron Joseph on Tuesday, ending a long dispute with his sister, Marie Joseph, over a family business.

Marie Joseph sued her brother in U.S. District Court in 2016, accusing him of breaching his duty to her as a minority shareholder of Columbia Oldsmobile Company – an automobile dealership and real estate company their father founded in 1938.

Marie Joseph asked the jury to award her more than $30 million in damages.

But the jury awarded her nothing, siding instead with her brother, Ron Joseph.

“At age 82, Mr. Joseph works every day, all day, to make money for her and the family company,” his attorney, Jim Burke, told jurors during closing arguments. “Marie’s claims are false. They are unfounded … she has benefited greatly from his hard work.”

George J. Joseph, the siblings’ father, founded Columbia in 1938 and led the company until his death in 1966. In the half-century since, it has thrived under the leadership of his son, Ron Joseph, Burke said.

“He gave his life to that company,” Burke said in closing arguments. He declined further comment, citing a court order that bans media comments about the case.

All seven of George Joseph’s children are shareholders of Columbia, but Ron Joseph is the majority shareholder and he runs the company.

From a single dealership, Ron Joseph “built an empire,” Burke told the jury.

Columbia owns several dealerships in Greater Cincinnati. It also has extensive real estate holdings, including several Downtown parking lots and the former Chiquita Center, now known as Columbia Plaza.

Marie Joseph accused her brother of funneling money from their family business - Columbia - to other companies and auto dealerships that are owned or operated by himself or his four sons - George, Gregory, Richard and Ronald Jr.

Some of these companies are known as Joseph Auto Group - a trade name and umbrella group used by 19 dealerships in Greater Cincinnati, Dayton and Columbus.

“It’s a great way to secretly funnel money, so your sister gets nothing,” said Marie Joseph’s attorney, Kevin Murphy, during closing arguments. “That’s the equivalent of taking her money right out of her purse.”

Murphy did not respond to requests for comment.

Marie Joseph claimed that her brother was self-dealing and moving money out of Columbia through fleet sales, loans, and management fees. She claimed he billed Columbia for country club dues and Cincinnati Reds tickets. She argued her brother usurped parking lot deals that should have gone to Columbia.

But the jury rejected all of her claims, after deliberating over portions of two days.

“These were fair and legitimate business deals that made a profit for Columbia,” Burke said.

Many employees and Joseph family members testified during the two-week trial.

Marie Joseph's attorney argued that she was deprived of benefits from her stock because she wasn't paid dividends. But Ohio law does not require company directors to pay dividends to shareholders.

“She’s 67 years old. She’s had those shares since she was 15… the only people who have benefited are the people on this side of the room. Not Marie,” Murphy said, pointing to Ron Joseph’s family who sat in the courtroom during closing arguments.

But Burke argued that Marie Joseph’s stock equity has risen dramatically over the years, largely due to Ron Joseph's hard work, and is now worth $3.8 million.

“Columbia is worth more now than ever," Burke said. "It’s thriving.”

As for the $30 million in damages that Marie Joseph had sought, Burke said, “That’s the entire net worth of the company. That’s how ridiculous those numbers are.”

None of Ron and Marie Joseph’s other siblings joined in her lawsuit.

This federal lawsuit is not the first court action involving Marie and Ron Joseph.

In 2015, Pineridge LLC, which is controlled by Ron Joseph and his wife, Marcia, filed a lawsuit in Hamilton County Municipal Court to evict Marie Joseph and her son Derek from a Mount Lookout home it planned to sell, after they claiming she rebuffed requests to leave for more than a year.

Marie Joseph, formerly Marie Housteau, began living in the home in 1994, according to the eviction lawsuit. She moved in two years after making a filing in U.S. Bankruptcy Court, records show.

Marie Joseph claimed she had a right to stay in the home because her mother Najla Joseph had negotiated for Columbia to buy it. She said she needed a new home for her three young children but couldn’t afford one, after her former husband, Thomas Housteau, went to prison for fraudulent commercial activities, according to her claim.

Court documents show Thomas Housteau pleaded guilty to aggravated theft in 1996 and was sentenced to five to 15 years in prison.

Marie Joseph ended her eviction challenge on April 12, 2016 -- the same date she filed the lawsuit against her brother in federal court. She now lives in Union, Kentucky, according to court documents.