51黑料

ST. LOUIS 鈥� Developer Paul McKee agreed in September to repay a union that had loaned him money for GreenLeaf Market, the now-shuttered grocery at 13th and Cass north of downtown.

But he didn鈥檛 pay by the December deadline, and when the union tried to ask him how much money he had, he invoked his constitutional right not to testify.

McKee鈥檚 use of the U.S. Constitution鈥檚 Fifth Amendment protection against self-incrimination is the latest tactic the controversial developer and his legal team have used as they try to keep control of hundreds of acres of real estate north of downtown.

In a lawsuit filed in November 2023, the Mid-America Carpenters Regional Council sued McKee and companies connected to the grocery store over a $1.5 million loan it extended to them in January 2020. The union told the court last year McKee and the grocery companies had agreed to pay $2 million in unpaid principal and interest by the end of December 鈥� nearly two years after the loan was due.

When they missed the deadline, the union hauled McKee in for a Jan. 27 deposition to find out what assets were available to pay back the loan.

鈥淲hat bank accounts, certificates of deposit, stock and investments does 51黑料 Grocery Group hold?鈥� Sherrie Hall, an attorney for the Carpenters union asked McKee during the deposition.

鈥淚 plead the Fifth,鈥� McKee responded.

鈥淲hat is the value of those assets?鈥� she continued.

鈥淚 plead the Fifth,鈥� he responded.

That was the back-and-forth for an hour and a half as McKee, the controversial developer behind NorthSide Regeneration, invoked the Fifth Amendment 381 times.

Also taking the Fifth in response to the union鈥檚 questions during the January deposition was McKee associate Glenn Mitchell, who is listed as a member and manager of several limited liability companies tied to the GreenLeaf grocery. GreenLeaf closed in December 2023.

The month before the store closed, the Carpenters union sued McKee and several companies tied to the grocer over the $1.5 million loan. Among the allegations was that McKee had put up as collateral on the loan his interest in an O鈥橣allon, Missouri, office building at 2342 Technology Drive. But in December 2020, Simmons Bank foreclosed on that building.

When it made the loan to McKee and the GreenLeaf companies, the union was known as the 51黑料-Kansas City Carpenters Regional Council and was led by Al Bond.

Bond used a union loan fund to make millions of dollars in loans to 51黑料 companies and developers, among the largest of which went to McKee and his companies. In addition to the grocery loan, the Carpenters union under Bond also loaned $1.5 million to help fund McKee鈥檚 Homer G. Phillips medical clinic, a loan whose balance has since grown to nearly $3 million. The medical clinic shuttered in December.

The loan fund was meant to help construction projects that would employ union members. Bond made the GreenLeaf loan more than six months after the store opened, and it was used for operating expenses, not construction costs.

The union鈥檚 national president fired Bond in September 2021 and dissolved the 51黑料-based union, merging its operations with the Chicago regional office and renaming it the Mid-America Carpenters Regional Council.

McKee refused to answer questions about whether he believed answering questions about his assets legitimately exposed him to criminal liability.

But both McKee and Bond have been tied to federal criminal investigations before.

Three years ago, Bond faced a federal criminal investigation, according to court documents filed in a lawsuit the union filed against him. It was seeking to recover more than $3 million paid for billboard advertising contracts he allegedly gave to his friend, advertising executive James Neumann. In an April 2022 court filing in that case, a lawyer for Bond said he faced 鈥淒epartment of Justice issues鈥� and was interviewing criminal defense attorneys.

It鈥檚 unclear whether the feds are still investigating.

McKee鈥檚 NorthSide was also once the target of an FBI investigation into 鈥減aper-only鈥� real estate transactions that NorthSide used to obtain millions of dollars in Missouri tax credits meant to reimburse him for money spent to purchase and maintain land. The Post-Dispatch obtained a copy of that 2018 FBI investigation, which documented instances in which NorthSide put no money down and used seller financing to acquire real estate 鈥� essentially writing an IOU and transferring the ownership on paper in order to trigger millions in tax credits.

The newspaper had previously reported other instances of such transactions. In 2011 and 2012, NorthSide took title to land near the Dome at America鈥檚 Center known as the Bottle District for no money down. It had been owned by McKee business partners Larry Chapman and Clayco鈥檚 Bob Clark. The paper-only transfer triggered some $9 million in tax credits, the proceeds of which NorthSide split with Chapman and Clark鈥檚 companies.

Even though the property is still technically in NorthSide鈥檚 name, Clark as recently as 2021 indicated he still controlled the Bottle District real estate and could transfer it to the city.

Ultimately, no one was charged in the 鈥減aper-only鈥� state tax credit deals. The federal five-year statute of limitations on wire fraud had expired.

Whether McKee truly believes he still faces criminal charges from his business activities, the Missouri Supreme Court has given debtors broad leeway to invoke the Fifth Amendment. In 2012, the state鈥檚 high court overruled a 51黑料 County Circuit Court judge who ordered two debtors to testify and reveal their assets.

Regardless, the Carpenters union says McKee and Mitchell鈥檚 use of the Fifth Amendment is unjustified, and it is asking a judge to compel them to answer questions about their assets.

鈥淭heir refusal to answer deposition questions about Mitchell鈥檚 telephone number, the business status of the Grocery Group Defendants and the McKee Entity Defendants, their roles in those companies, their title and ownership in the companies, the names of employees or those associated with the companies, and even basic information such as the companies鈥� addresses, was improper,鈥� the union said in a February filing. 鈥淣one of these questions sought information that could have incriminated them or linked them to any criminal activity.鈥�

A McKee lawyer at law firm Stone Leyton and Gershman referred questions to Steven Goldstein of Goldstein and Pressman, who represented McKee and Mitchell during the depositions.

鈥淚 only litigate in a court of law and not in the court of public opinion,鈥� Goldstein said in an email. 鈥淟ikewise, I share my thoughts on strategy only with my co-counsel and my clients.鈥�

McKee is facing legal action from multiple directions. The 51黑料 Land Clearance for Redevelopment Authority has begun eminent domain proceedings on dozens of properties owned by NorthSide Regeneration around the nearly complete National Geospatial-Intelligence Agency. And last year, NorthSide faced foreclosure on roughly 1,000 properties for years of unpaid property taxes. It managed to pay the roughly $1 million tax bill by a December deadline.