Erie entrepreneur Samuel P. "Pat" Black III is not stopping at suing his adopted daughter for $200 million in a case in which he claims she defrauded him through racketeering.
Black has filed a new lawsuit against his daughter and former heir apparent, Sumi James-Black, whom he adopted in 2019, when he was 77 and she was 44.
The new case claims James-Black has defaulted on a $902,000 installment loan that Black gave her in September 2021 to help her buy a house they were supposed to share in Portugal.
The suit claims James-Black has made no payments on the loan since they were due starting in September 2022, and that she now owes Black $1.12 million. The amount is made up of the base loan of $902,000 plus $217,000 in interest at a default rate of 4.72%.
The loan is the "Portugal loan," according to the amortization schedule attached to the lawsuit, filed in Erie County Common Pleas Court on April 30.
The date and description of the loan match a transaction mentioned in Black's $200 million lawsuit against James-Black — a pending case in which the full civil complaint was filed in Common Pleas Court in April 2024 and transferred to U.S. District Court in Erie a month later.
"In 2021, again with Mr. Black's funds, Defendant Sumi purchased a home in Portugal for over $1,900,000," according to the federal suit. "While Mr. Black is a 50% owner of said property, despite repeated requests, Defendant has refused to either pay Mr. Black back his money or sell the property to allow him to recoup his money. To date, and despite his request, Mr. Black has never been provided a key or access to the Portugal property."
James-Black will fight the suit over the loan as she also contests the federal lawsuit and other litigation that she says is meant to eliminate her financial stake in Black's holdings, said her lawyer, John Mizner.
“This lawsuit, like the one pending in federal court, will be vigorously defended.”
"This lawsuit is yet another attempt by Mr. Black to intimidate and discourage his daughter, Ms. Sumi James-Black, from pursuing her legal rights as a minority partner in the family partnership," Mizner said. "It will not succeed, and this lawsuit, like the one pending in federal court, will be vigorously defended."
A RICO case between father and daughter
The federal lawsuit mentions the Portugal house in the context of the claims that James-Black conspired to bilk Black of at least $200 million from 2017 to 2022. Black says he discovered the scheme shortly before he fired James-Black as the interim CEO and chief operating officer of his Erie Management Group, which runs Black's businesses, including the biodiesel giant Hero BX.
Black is claiming the fraud was executed in a way that amounted to civil violations under the Racketeer Influenced and Corrupt Organizations Act, the 1970 federal law designed to fight organized crime. James-Black is denying the claims.
Black was once one of wealthiest people in Erie, worth hundreds of millions of dollars. As Black's own lawyers said in the lawsuit, the 83-year-old has been put in "the position where he is essentially out of liquid assets."
Legal filings due soon in federal case
The lawsuit over the Portugal loan will unfold in Common Pleas Court at the same time Black's $200 million suit proceeds before U.S. District Judge Susan Paradise Baxter. James-Black, 50, wants the suit dismissed from federal court, arguing in part that the RICO claims — the claims that moved the case to federal court — are legally deficient.
On April 10, one of Black's lawyers abided by an order from Baxter and supplemented the original 327-page federal lawsuit with a 69-page filing known as a RICO statement. It lists the RICO claims against James-Black and the other two defendants named in Black's suit: the Erie law firm of Knox, McLaughlin, Gornall & Sennett, which represented Black and his companies; and Nicole Buzzard, who was vice president of management and accounting at Erie Management Group.
The Knox firm and Buzzard have also asked Baxter to dismiss the lawsuit from federal court. The defendants are in the process of filing objections to the RICO statement. James-Black's objections are due on May 10.
As the litigation continues, Black remains the head of Erie Management Group, whose holdings also include Black Insurance Group, of which Black is president. His father, Samuel P. Black Jr., started the insurance agency on the way to leaving behind a personal fortune of more than $318 million when he died at 99 in 2001.
That considerable financial legacy, according to the federal lawsuit, is on the verge of vanishing.
Original Article by: Ed Palattella at epalattella@timesnews.com or 814-870-1813.