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District 113 candidates defend business backgrounds

Business backgrounds have become a contentious issue among the state House District 113 candidates who list their net worth at about $1 million or more.

Mailers attacking the finances and dealings of candidates Mark Weithorn and Adam Kravitz have hit mailboxes, dredging up unpaid bills and loans and ties to a company under SEC investigation in the 90s.

Weithorn, Kravitz and David Richardson are among the Democrats vying to win the Aug. 14 open primary for a seat that includes Miami Beach and portions of Downtown Miami and Little Havana.

Waldo Faura Jr., an insurance adjustor, is also running for the District 113 seat.

One ad labels Weithorn a "deadbeat" and cites more than $350,000 in judgments and $4,000 in Florida Department of Revenue tax liens levied in the last dozen years on the candidate and his various Florida corporations.

That includes an $88,000 judgment from November against Weithorn and his former company, Digital Printers International, for failing to make payments on an $80,000 loan from Banco Popular. The loan was an SBA Express loan and half of the money was guaranteed by the U.S. Small Business Administration, according to court documents.

The ad also says Weithorn violated election law by not disclosing in campaign filings the Banco Popular judgment or a $13,500 judgment that is a source of ongoing litigation with DPI business partner Glenn Schmidt.

"Mark Weithorn has got to be kidding," states the ad, which was authored by Citizen Action, an electioneering organization tied to Kravitz consultant Keith Donner. The mailer’s postage was paid for Donner’s consulting company, 50 Blue LLC.

"He’s running to be our state representative. But he’s also running from his creditors, including the State of Florida and U.S. Government," says the ad.

Weithorn’s campaign responded with its own campaign piece that says Kravitz is guilty of "a despicable sleazy personal attack on my character." Weithorn said his business tanked with the economy and he is now "paying off my residual debts."

"Like many people who have been sued by vindictive former partners, lawsuits filed by them are often fill with bogus charges and end up being dismissed by judges: with prejudice," Weithorn wrote. "That is the case here. Of course, they did not bother to tell you about that."

But Schmidt’s attorney, Alan Geffin — who has contributed to the Kravitz campaign — said Weithorn isn’t being honest about his ongoing legal spat with his former DPI partner.

Court records show the lawsuit was indeed dismissed after the parties reached an $87,500 settlement in 2006. But the lawsuit was later reopened and Weithorn, DPI and a third business partner were hit with a $13,500 judgment in 2009.

Schmidt is still fighting for the money, and last month Geffin filed a motion in court in which he said Weithorn had refused to answer questions during a deposition and cried poor in court — only to then list his net worth at $950,000 in a campaign financial disclosure.

Earlier this month, a judge ruled in favor of a Geffin motion to sanction Weithorn and force him to answer questions in a deposition.

"You vote for someone who’s honest, candidate and credible," said Geffin. "Sadly it appears that Mark Weithorn is none of the three."

Weithorn, however, said Geffin "lost one-third of the payments" he made and he is disputing how much he owes Schmidt.

Weithorn’s campaign has also hired attorney Robert Fernandez to review his financial disclosure.

The form in dispute states that "failure to make any required disclosure" can carry a civil penalty of up to $10,000 or can result in a candidate being disqualified from the ballot. But Fernandez said it’s more likely that Weithorn would simply have to amend his form if indeed he failed to disclose anything.

"Any discussion of trying to kick somebody off the ballot because they didn’t appropriately disclose something on a form — that’s crazy," Fernandez said.

While Weithorn defends his legal woes, Kravitz is himself fighting allegations from an electioneering group tied to Richardson that his financial background — which he is highlighting in his campaign — is spotty, if not distorted.

Restore Florida has attacked Kravitz over his two-year stint in the mid-90s with AppleTree, a Boca Raton-based food manufacturer once known as Modami that was investigated by the Securities Exchange Commission, moved its headquarters to Virginia 1996 and then filed for Chapter 11 bankruptcy.

According to newspaper reports, problems surfaced in 1994 after the company’s board alleged that two top executives had diverted more than $1 million in company dollars and failed to disclose ownership interests in a Tel Aviv company doing business with AppleTree, a public company.

An AppleTree press release at the time said the officials were ousted after a private attorney and Kravitz’s father, Paul Kravitz, traveled to Israel and investigated its executives’ improper business relationships. The board then elected the elder Kravitz as chief executive and he brought his son in as general counsel.

The elder Kravitz was later accused by the SEC of forgery and failing to disclose that he lent $ 250,000 in proceeds from a stock offering to help build a gambling casino. He retired in August 1996 as the company moved to Virginia. He later settled with the SEC for $25,000, but did not admit to any wrongdoing, according to a Bloomberg Business News report.

Kravitz the candidate said his father hired him after the company alerted the SEC to problems and he left in August 1996. He said he had nothing to do with the company’s bankruptcy and was never investigated by the SEC or named as a defendant in a lawsuit against the company.

He said his father’s settlement is irrelevant to the race.

The Restore Florida also says Kravitz’s campaign website statement that he "helped create" the popular Jewish dating website JDate is dishonest, and says he was among leadership at MatchNet — JDate’s parent company, now called Spark Networks — that "nearly ran the company off the rails."

The ad cites a Forbes Magazine article for the information about MatchNet’s financial woes.

"Forbes Magazine wrote an article saying they basically ran the company into the ground," said Richardson consultant Eric Johnson, who has done work for Restore Florida.

The referenced article, however, says "the company’s forecast went off the rails" in August 2004 — five months after Kravitz resigned.

According to MatchNet financial reports from 2003 and 2004, Kravitz was appointed a MatchNet director in 1999 and worked as an executive until he resigned in March 2004 and received a $2.4 million severance.

As for whether he helped create JDate — Joe Shapira and Alon Carmel are credited in media reports as co-founders — Kravitz says he doesn’t take credit for the inspiration of JDate, but rather his business role in establishing the website.

"To put it simply, this is a disgusting and misleading attack on my reputation based on intentionally shoddy research by one of my opponents who would rather not discuss actual facts," Kravitz wrote in an email.

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