$15-million lawsuit for fraud and conspiracy filed against Havana Group, a company connected to slain mobster Pat Musitano
Havana Group Supplies, connected to Pat Musitano, is being sued for fraud and conspiracy over claims of $110 million a month in contracts
A second lawsuit has been filed in connection with a Flamborough property that’s facing charges by the environment ministry related to illegal dumping.
Waterdown Garden Supplies Ltd. has launched a $15-million lawsuit for fraud, breach of contract and conspiracy against convicted fraud artist Steve Sardinha, his Havana Group Supplies company and the estate of his late mother, along with several other defendants.
The dispute is connected to the Waterdown Garden property on Highway 5 west of Peters Corners, where more than 24,000 loads of soil were dumped into piles as high as 10 metres between the summer of 2018 and the spring of 2019.
The lawsuit alleges Sardinha and Havana Group Supplies fraudulently misled Waterdown Garden into a business arrangement by falsely claiming to have secured contracts worth $110 million per month from Metrolinx, CN and some Ontario casinos.
None of the allegations in the lawsuit have been tested in court.
The Havana Group Supplies company and Sardinha did not respond to requests for comment made through their lawyer.
A Spectator exclusive investigation in April 2019 revealed the contracts never existed. Sardinha is now facing a number of charges in Niagara for fraud, theft, uttering threats, conspiracy and possession of stolen property related to his Havana Group Supplies business.
Waterdown Garden Supplies alleges it lost more than $10 million because of the company’s association with Havana Group Supplies and Sardinha — from lease payments that weren’t made, to topsoil and gravel that was removed by Havana without payment, to the vast amounts of material that were dumped on the site and remain there still.
The property has been the target of complaints in recent years by neighbours and it’s currently the subject of orders issued by the city and Ontario’s Environment Ministry.
The lawsuit was launched by Waterdown Garden Supplies, in part, to address liability issues related to the dumped material. The company alleges it lost control of the property and was evicted in 2018 through a court order, but is still liable for the potential cleanup costs as well as any possible fines that could be assessed.
The latest lawsuit by Waterdown Garden Supplies was filed at the same time as a $75-million lawsuit aimed at the City of Hamilton and two of its employees.
The Hamilton lawsuit alleges Carlo Ammendolia, a city manager, and Craig Saunders, a bylaw officer, conspired with slain mobster Pat Musitano and Havana Group Supplies to dump thousands of loads of potentially contaminated soil at the Waterdown Garden property even though the city had previously ordered the site to stop accepting soil.
More than 2,000 of the loads, which were potentially contaminated with cadmium, mercury, zinc and petroleum hydrocarbons, among other substances, are alleged to have originated at the city’s own job sites.
Documents sworn out in support of the lawsuit allege Ammendolia and Musitano were each receiving $20 per load — “substantially more for contaminated loads,” according to one affidavit — and that the two men had “substantial secret ownership” of a company involved in excavation, “fill management” and dump truck services.
Musitano was a silent partner in Havana Group Supplies and a childhood friend of Steve Sardinha in north end Hamilton.
The latest lawsuit alleges the fraudulent representations by Sardinha and his company led Waterdown Garden to allow Havana to lease some of the Highway 5 property.
One such fraudulent representation, the lawsuit alleges, was that Sardinha and the other defendants used a fake engineering company called SPL Engineering to help dupe Waterdown Garden into believing the Metrolinx, CN and casino contracts were real.
A former bookkeeper for Havana Group Supplies states in an affidavit that she helped create false documents for the fake company, including email correspondence sent from a fictitious principal of the company.
“The purpose of creating SPL and the (internet) domain name was to mislead (Havana) suppliers and customers that SPL was a real engineering firm that had been in operation for years,” the former bookkeeper’s affidavit states.
Havana announced it had obtained $110 million a month in contracts at a gala event, held in July 2018 at Carlisle Golf Club designed to impress potential investors.
One affidavit alleges Havana spent $44,000 to rent 11 pieces of heavy equipment that were then parked along the golf club driveway on the night of the gala “to give the appearance the company had more equipment than it did.”
Once Havana Group Supplies obtained the lease at the Waterdown Garden property, it’s alleged, Sardinha and the company sold $3.8 million in trucking “tickets,” or chits, that resulted in thousands of loads of soil being dumped at the site.
The lawsuit alleges Sardinha would then divert the money to himself or to bank accounts he controlled.
“He did this by accepting cash, under the table payments for these shipments or having trucking companies issue cheques or bank drafts to his mother’s name,” the lawsuit alleges.
At the time, Sardinha was subject to a so-called Mareva injunction from a court order in a separate lawsuit. A Mareva injunction freezes a person’s assets so they can’t be spent or moved around without a court order.
The latest lawsuit alleges Sardinha obtained power of attorney for his now-deceased mother, Maria Sardinha, as a way for Havana Group Supplies money to pass through her and allow him to bypass the Mareva injunction.
The Spectator has obtained a copy of the document Maria Sardinha signed appointing her son as her power of attorney.
The lawsuit also alleges Sardinha diverted money to his wife, a Cuban national who lives in Cuba, using a third-party bank account.
The Spectator has obtained copies of bank transfers that were made from a TD Canada Trust account to a woman in Cienfuegos, Cuba, who is purportedly Sardinha’s spouse.
There were 13 transfers totalling $169,650 made between Oct. 16 and Dec. 8, 2018.
Ontario’s environment ministry issued an order against the Waterdown Garden property in 2019 concerning excess soil and groundwater monitoring wells.
A spokesperson for the environment ministry said in an email that the order remains in effect and the “parties have not complied with any of the requirements of the director’s order.”
On Jan. 12, Waterdown Garden was charged by the environment ministry with six offences under the Environmental Protection Act and two offences under the Ontario Water Resources Act for alleged violations at the Flamborough property.
The city had already issued an order against the property in 2015 to prevent the dumping of fill.