When two Houston real estate developers met in 2004, they quickly became friends and business partners. And for several years, the partnership thrived.
But around 2020 — despite their successes — Ronny Hecht, who is also a lawyer, decided he no longer wanted to be partners with Avishai Ron. Efforts to untangle their business interests in various real estate projects led the men to target each other in a series of lawsuits — at least a half-dozen to date.
And this week, jurors in Dallas County have been drawn into the dispute. They will have to decide whether to believe the claims of 13 limited partners — among them a couple of lawyers — who accuse Hecht and his company, Hecht GP, of costing them millions of dollars by, as they allege in the lawsuit, “taking actions on at least one real estate venture that defied logic.”
That venture happens to be the 2023 sale of a piece of real estate on Preston Road that was at one time occupied by an LA Fitness and is adjacent to the site the Dallas Mavericks have chosen for their new home.
The limited partners, who filed suit in April 2024, allege that when Hecht sold the property that had been valued at as much as $14 million for just $8.5 million, he either did so “knowingly and intentionally” to gain leverage in his legal battles with Ron or because he was “grossly negligent.”
Prior to filing the lawsuit, the limited partners demanded to inspect the books and records of Quasar GP, which is the entity Hecht and Ron created to purchase the property.
The plaintiff’s attorney, Michael Tobolowsky of Tobolowsky Law, told the jury Wednesday morning in opening statements that Hecht is refusing to accept responsibility for his actions and maintains he attempted to sell the property at a higher price but couldn’t do so because Ron wouldn’t talk to him.
“What you don’t do is this: point the finger at anyone and everyone else that you can, come up with any reason and every reason under the sun why it’s not your fault,” Tobolowsky said.
He told the jury that humans all make mistakes.
“Some mistakes, unfortunately, like the one we’re here for today, end up causing people millions upon millions and millions of dollars,” Tobolowsky said.
According to court documents, Hecht sent a letter to limited partners in June 2023 stating that the sale price had wiped out every partners’ equity, and they would not be receiving any proceeds. The limited partners allege that this meant a $3 million loss for them.
Tobolowsky told the jury they would hear about the litigation that followed the breakup of the friendship, which began in January 2021 when Hecht sued Ron in Harris County to untangle who owned what regarding their other real estate ventures.
“The evidence is going to show that it’s such a battle these two guys can’t even talk to each other,” Tobolowsky said, adding to this day they have not spoken.
In November 2021, LA Fitness, which had been paying about $100,000 a month in rent the property, declined to renew its lease at a higher rate and vacated the building. Tobolowsky said the evidence will show that unsolicited offers of as much as $14 million for the property followed, but the fighting between Ron and Hecht prevented any movement toward a deal.
Hecht ended up selling the property for $8.5 million, which Tobolowsky said barely covered the $10.5 million debt and constitutes a breach of his fiduciary duties as the general partner.
“Do not take me at my word. I’m telling you that everything I’ve told you guys, right now, is the truth — but wait until you see the evidence,” Tobolowsky said.
Hecht’s counsel, Michael Hurst of Lynn Pinker Hurst & Schwegmann, told jurors the limited partners now suing his client benefited greatly from Hecht and Ron’s partnership and saw their investments more than double in deal after deal.
“A rising tide lifts all boats,” he said.
But the tide receded in the face of a global pandemic and a crashing real estate market, he added.
Hurst told jurors the harm alleged in this case has nothing to do with Hecht’s alleged mismanagement but instead centers on Ron’s vindictive actions after Hecht ended their partnership.
“Let me be very clear about something. Ronny had lost more money on this deal than anyone else in the entire deal,” Hurst said.
He told the jury that Hecht has not been sued for a “mistake.”
“They sued him basically for intentionally losing the money of himself and his family members and everybody else,” Hurst said.
In counterclaims, Hecht accuses Ron of interfering with the management and rejecting a proposed sale. According to the complaint, Hecht GP was interested in rezoning the location for multifamily housing, but Ron requested that Hecht and Hecht GP stop its efforts to rezone and just list the property for sale.
Hecht claims he told Ron about the $14 million offer but never heard from him.
Hurst told the jury that Tobolowsky left out that Ron was going through a divorce before his fall out with Hecht. The complaint states Ron instructed Hecht to become the sole general partner of Quasar Preston because he was “in the throes of a nasty, protracted and contentious divorce.”
Ron participated in management and received 50 percent of all fees due to the general partner, Hecht GP. According to the counterclaim petition, Hecht and Ron entered into a settlement agreement to resolve some of their disputes. As part of the agreement, the general partner of Quasar was supposed to be changed from Hecht GP to Hecht and Ron. Ron was supposed to facilitate that change by obtaining all the signatures of the limited partners. However, no documents were returned to make the change.
The settlement agreement stated that all decisions that Hecht and Ron made while co-general partners of Quasar had to be mutually agreed upon. Hecht needed Ron’s consent to do anything with the property.
Hurst told the jury that Hecht did not sit on his hands and just fight with Ron instead of figuring out what to do with the property. He said that he pursued rezoning and interviewed and hired brokers.
“This case is not what they’re claiming it to be, and it’s not based upon any facts,” Hurst stated to end his opening statement.
Jury selection took all day Tuesday. Four men and eight women were selected to serve on the 12-member jury.
The jury trial, proceeding before Dallas County District Judge Maria Aceves, is expected to go through the end of next week.
Among the 13 limited partner plaintiffs are two Houston-based lawyers, Andrew Meade and John Neese.
Holly Stubbs, David Coale, Daniela Holmes and Erin Elms-Nemacare of Lynn Pinker Hurst & Schwegmann and Julie Pettit for the Pettit Law Firm are also representing Hecht.
The case number is DC-24-05091.