Delray developer loses fraud case against late founder of Subway

When a judge in January ordered Anthony Pugliese to pay $23.1 million to the family of the late Subway founder Fred DeLuca, the Delray Beach developer insisted he would get the money back by suing the sandwich mogul for fraud.

Those hopes were dashed on Thursday when an appeals court refused to resurrect the 19 claims of fraud Pugliese filed against DeLuca in 2009 after the business titans’ plans to build a massive city in Central Florida collapsed amid recriminations that ultimately sent Pugliese to jail.

RELATED: Anthony Pugliese owes Subway estate $13 million

The 4th District Court of Appeal’s decision was delivered with unusual speed. On Tuesday, Pugliese’s attorneys explained to the three-judge panel why the claims should be reinstated. The court, which normally takes months to decide a case, rejected Pugliese’s arguments 48 hours later.

“The DeLuca family always believed that Pugliese’s allegations were false,” attorney Rick Hutchison, who represents DeLuca’s widow, Elisabeth, said in a statement. “The DeLuca family appreciates the time and effort the courts and their staff spent on this case.”

Pugliese’s attorneys weren’t immediately available for comment. But the battle is far from over.

PREVIOUS STORY: Delray Beach developer Anthony Pugliese charged

While Pugliese can’t appeal the ruling to the Florida Supreme Court, he could ask all 12 judges on the West Palm Beach-based appeals court to reinstate the fraud claims. They were thrown out by Palm Beach County Circuit Judge Donald Hafele before the dueling lawsuits Pugliese and DeLuca filed against each other went to trial in 2017.

However, even if the entire appeals court refuses to hear Pugliese’s case, the developer could still escape the $23.1 million judgment.

He is appealing the jury verdict that he committed civil theft and breached an operating agreement he had with DeLuca to build a community dubbed “Destiny” on 41,000 acres near Yeehaw Junction. Based on the jury verdict, Hafele ruled Pugliese owed Deluca’s widow $12.8 million. Pugliese is also appealing Hafele’s order that he pick up DeLuca’s $10.2 million legal tab.

Those two appeals are still pending.

During the trial, Hutchison hammered Pugliese for sending DeLuca fake invoices from phony companies to keep money flowing. Hutchison said Pugliese used the money for personal expenses, such as buying a moat chiller to protect tropical fish swimming outside his estimated $40 million Gulf Stream mansion.

Denying that the money was used for luxury items, Pugliese said he was forced to turn to deception when DeLuca stopped bankrolling the project, making it impossible for him to pay employees who were working on the plans for the development that he described as his dream.

Weeks before DeLuca died of leukemia in 2015, Pugliese and his business manager, Joseph Reamer, pleaded no contest to charges of an organized scheme to defraud. Pugliese also pleaded no contest to grand theft, served four months of a six-month jail sentence and repaid DeLuca $1.2 million.

Pugliese didn’t try to hide his conviction from the jury. His lawyer, Willie Gary, even told jurors his inmate number.

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