A Bronxville publisher who invested in two travel and leisure franchises claims he was duped by a felon.
Peter Flower accused Dennis Kelly and Morris Communications Company of violating the New York Franchise Sales Act, in a complaint filed on May 28 in U.S. District Court, White Plains.
“Due to the statutory violations, material omissions, and misrepresentations,” the complaint states, “Flower was sold franchise rights that were doomed to fail from the start.”
For more than 20 years, Flower says, he has produced travel and leisure publications such as the New York City Pocket & Travel Guides and the Multilingual Guide to NYC.
In 2018, when he noticed that print publications were slumping, he looked for digital opportunities and found Morris Visitor Productions (MVP) in Augusta, Georgia.
He discussed licensing opportunities with chief financial officer Dennis Kelly and other MVP officials, according to the complaint. In 2023, he bought two franchises: one granting regional print rights in the New York metropolitan area and another for exclusive digital rights nation-wide.
Flower claims he was assured that the franchises were profitable, that the New York print publication was bringing in $1.2 million a year and he would make $300,000 a year in digital revenue.
But the purported financial results were unaudited, the complaint states; Kelly had already the digital rights in the most lucrative territories; and MVP had filed for Chapter 7 bankruptcy liquidation in 2022.
Flower discovered that MVP was saddled with $76 million in debt, according to the complaint, and that Kelly had been convicted and imprisoned for mail fraud, money laundering, and embezzlement.
Flower says the franchise deals were “an unmitigated financial disaster.” He had lost millions of dollars trying to keep them functional.
He argues that MVP and its parent company, Morris Communications, were required under the New York Franchise Sale Act to register an offering prospectus with the New York Office of Attorney General that would have disclosed crucial information.
Had he known about MVP’s finances or Kelly’s criminal record, Flower says, he would not have invested in the franchises.
He accuses Kelly and Morris Communications of failure to register and disclose a prospectus, failure to register Kelly as a salesperson, fraud, negligence, and unjust enrichment. He is demanding unspecified monetary damages.
Kelly and Morris Communications did not reply to a request for comment that was submitted through the company website.
