A north suburban man and his family who say they invested $3 million in construction projects featured on the HGTV reality television series “Windy City Rehab” are suing stars Alison Victoria Gramenos and Donovan Eckhardt, accusing them of running “a deliberate and fraudulent scheme to misappropriate funds.”
The lawsuit also accuses the stars of the show featuring Chicago homes being rehabbed and flipped for a profit of “bungling” and gross mismanagement of “nearly every project they were associated with” and Eckhardt of falsely claiming close ties with the Chicago city buildings department.
And it challenges efforts by Gramenos, who grew up in Lincolnwood and goes by Alison Victoria on TV, to lay blame for the show’s problems on Eckhardt, saying, “Alison has claimed that she was caught unawares by Donovan’s fraud — notwithstanding her own secreting of funds from closing proceeds.”
The suit was filed Tuesday in Cook County circuit court by Michael Ward Jr. — a Lake County resident and onetime friend of Eckhardt — his brother Thomas Ward, also of Lake County, and their father Michael Ward Sr., a Cook County resident.
They say they put up $3 million for a 50 percent stake in a business called Alovanward LLC that funded six of the projects featured on the TV show in what’s so far been its only season, as well as a seventh rehab job.
The Wards say they were led to expect a good return on their money and also were enticed by Eckhardt and Gramenos’s claims to be expert house flippers and by Eckhardt’s assertions of his relationships with city building officials — who later cracked down on the pair with numerous stop-work orders.
“In an effort to gain access to the Wards money, Donovan — individually and with the affirmation of Alison — falsely claimed he had specific expertise in the City of Chicago whereby his personal relationships with City building officials and ready access to additional working capital would streamline the ‘flipping’ process and ensure maximum return,” the lawsuit says.
The Wards say the venture fell apart because of the stars’ “sheer ineptitude and duplicity” and “gross mismanagement … including the absence of workmanlike standards and adherence to building codes, that marred nearly every Alovanward project they were associated with.”
Daniel Lynch, a lawyer for Gramenos, repeated her past comments blaming Eckhardt, saying Wednesday: “Mr. Eckhart was the licensed developer and general contractor on a series of house-flipping projects and Ms. Gramenos did design work on those projects. The projects did not deliver the financial results that everyone was hoping for.”
Lynch said Gramenos “suffered substantial losses of her own” and tried to get the Wards documents on the projects, “but she has not been able to obtain all project documents from Mr. Eckhardt.”
Eckhardt did not respond to a request for comment.
The Wards say they first were supposed to have their investment repaid and then share in further profits. But they say they are owed nearly $2 million on the $3 million they put in.
The Wards want a judge to order Gramenos and Eckhardt to repay their investment and order a full accounting of the properties on the show, which HGTV’s corporate owner Discovery Inc. has renewed for a second season that was due to begin in July. They also want punitive damages.
Their lawsuit says they discovered Eckhardt and Gramenos’s “ineptitude” by watching the show.
“At the same time Donovan and Alison were repeatedly giving assurances to the Wards as to the ongoing successful progress of their joint venture, they were bungling the renovations on most, if not all, of the Subject Properties, including one instance in which an entire brick facade collapsed as HGTV cameras rolled,” the suit says.
The show featured Gramenos — who starred in “Kitchen Crashers” on the sister DIY network — and Eckhardt buying, rehabilitating and selling homes in Wicker Park, Bucktown, Ukrainian Village, Lincoln Square and Lincoln Park.
A representative of Discovery wouldn’t comment.
People living near the homes that Eckhardt and Gramenos rehabbed complained of muddy, trash-strewn worksites, and the buildings department issued several stop-work orders, finding that some work was done without permits or in a substandard fashion. Eckhardt’s contractor’s license was temporarily suspended last year.
Gramenos and Eckhardt remained suspended from getting new building permits in Chicago as of May 27. The buildings department did not immediately respond to a request for an update.
The TV rehabbers already were facing other lawsuits.
The buyers of a $1.36 million “Windy City Rehab” home at 2308 Giddings St. in Lincoln Square sued Gramenos, Eckhardt and Discovery late last year, saying the home was plagued by leaks and shoddy work, including an upper-floor shower that began leaking into the kitchen ceiling just a day after the sale closed.
In April, the buyers of a $1.33 million home at 1700 W. Wabansia Ave. in Wicker Park sued, saying a garage was never completed and that work was done without required permits.
Gramenos told the judge the Wabansia Avenue buyers’ complaints have no merit.
