Co-defendant in Mott case accuses her of breach of contract in real estate transaction

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A co-defendant in the alleged check-kiting scheme spearheaded by Katherine Mott contends the embattled restauranteur sold her a house but later pledged that same property as collateral on the loan to buy the Crescent Beach restaurant.

Taylor Pagano, senior event coordinator at the Mott-owned event venue The Wintergarden by Monroe’s, alleges in court papers that she paid $650,000 on June 10, 2022, for the house at 2990 Clover St. in Pittsford.

Payment was made in full to a Mott-operated LLC, the complaint says, and “accepted by the defendants without objection.” But there apparently was never a transfer of title provided to Pagano or filed with the Monroe County Clerk’s Office.

Instead, in November of 2023, Mott pledged the house and a property at 370 French Road in Pittsford as collateral on the $1.7 million mortgage provided by Casciani Construction Co., Inc., for the purchase of the Crescent Beach property on Edgemere Drive in the town of Greece.

RELATED: Mott-Formicola pleads guilty to defrauding Five Star Bank

The Pagano complaint, filed this morning in state Supreme Court in Monroe County, says Mott and the LLC — 11 Wexford Glen — has been “unable or unwilling” to provide the title “despite due demand.”

Along with Mott, three others are named as co-defendants in the lawsuit: 11 Wexford Glen, LLC, Casciani and ROC Funding Group of Staten Island. Attorney Derrick Spatorico, partner at Pheterson Spatorico, LLP, is representing Pagano.

The complaint alleges 11 Wexford Glen is the “alter ego” of Mott, “used as a shell company to attempt to shield her from personal liability.” Mott purchased Crescent Beach through 11 Wexford Glen.

Pagano’s lawsuit alleges breach of contract and asks for an order compelling the defendant(s) to return the $650,000 along with imposition of a constructive trust “to ensure defendant does not unjustly benefit from this wrongful conduct.”

She also seeks a temporary restraining order (TRO) “to prevent defendant from dissipating, transferring or encumbering” the assets listed in the complaint. If not restrained, the filing contends, Pagano likely will be unable to be compensated.

The complaint also requests that the court issue an order “quieting the title to the property, thereby removing any adverse claim or encumbrance.”

Mott’s guilty plea on Monday in federal court to criminal charges of bank fraud and money laundering may have created urgency in the Pagano filing.

As part of the plea, Mott must forfeit property and will be responsible for paying restitution of a nearly $19 million to Five Star Bank, the proceeds of the check-kiting scheme.

She faces up 97 months in prison, up to a $250,000 fine and five years probation when U.S. District Court Judge Frank P. Geraci Jr. imposes sentencing on May 1.

Pagano, Robert Harris, Kristina Bourne and Timothy Larocca were listed in May as a co-defendants in Five Star’s civil suit against Mott. The bank  contended in court papers that they acted as “mules” in the transferring or hiding of money.

The venues in Mott’s restaurant and hospitality portfolio continue to operate, although the receiver in the civil case reported to the court that Monroe’s, The Wintergarden and Divinity Estate & Chapel likely will be sold in order to keep operations afloat.

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