Editor's note: This article has been updated to reflect the addition of comments from the defendant.

A partnership that quickly turned sour has landed the opposing parties in court, with one party demanding $11 million and the other calling the lawsuit frivolous.

Gregory Palivos filed a complaint Nov. 9, 2015, against Kyle Rolek, individually and as an agent of Rolek Advisory, in Cook County Circuit Court, alleging six different types of misconduct and seeking actual, exemplary and punitive damages of $11 million.

Rolek has denied the allegations in court, and asked the court to dismiss the complaint. In comments to the Cook County Record, Rolek said Palivos' lawsuit is without merit and the dollar amount he is demanding "was  pulled out of thin air to get attention." Rolek said the business at the heart of the dispute has been dissolved and "has no value."

According to Palivos' complaint, the men met after Palivos began working as a financial adviser at McAdam Financial Group’s Chicago office in January 2014. He was quickly promoted to district manager. Rolek also had a senior position with the firm. According to the complaint, Rolek wanted to start a new company with Palivos “in order to act on various new and unique business ideas Palivos had created and described for expanding the financial adviser business,” the complaint said.

Rolek left McAdam in March 2015, after which “he continued to aggressively recruit Palivos and asked him to become an equal business partner with Access Advisors,” according to the complaint. Palivos accepted, resigning from McAdam on April 24. They met several times over the next month, and on May 27 jointly executed a Membership Unit Subscription Agreement for the company, which gave Palivos an irrevocable right to purchase half of the business for $1. He later exercised the option.

Before agreeing to the partnership, Palivos explained to Rolek his idea to work “with the U.S. Customs and Immigration Service’s EB-5 regional offices” to develop business relationships with foreigners who invest at least $500,000 stateside. He arranged office space in downtown Chicago for college interns who would generate business for Access. Rolek, however, “soon began to secretly contact the regional offices and discussed them doing business with only him.”

Though he told Palivos only two EB-4 offices were interested, “in reality as many as 50 EB-5 regional offices expressed interest in the program,” the complaint alleged. Rolek also is accused of meeting privately with the interns and instructing them to stop responding to Palivos. 

Palivos suggested Access sign a contract with National Financial Partners for insurance and wealth management services. Rolek agreed but said he could not contribute to the $16,000 annual fee, which Palivos paid in full. Yet it was Rolek who offered to deal with NFP, including more secret meetings aimed at isolating Palivos.

Rolek also allegedly refused to pay half the $150,000 to $200,000 web development contract for access. Palivos said the refusal was rooted in the secret creation of Rolek Advisory. Further Rolek refused to include Palivos’ name on license and registration documents for Access. The complaint details other instances in which Rolek allegedly used Palivos’ ideas and connections — including former McAdam colleagues and the father of one of Palivos’ college friends — then cut him off from knowledge of business performance and diverted funds away from Access in order to avoid paying Palivos half the proceeds.

Palivos alleged he became fully aware of Rolek’s actions in July. Rolek Advisors was incorporated on July 24 in Delaware and registered as an insurance agency in Illinois on July 29. Despite launching this company and stating an intent to compete with Palivos, Rolek remains a fiduciary of Access Advisors.

Palivos has accused Rolek of breach of fiduciary duty, breach of contract, intentional interference with prospective economic advantage, fraud and trade secret misappropriation. 

Palivos’ attorneys are Jonathan M. Boulahanis and Todd M. Murphy, of Gordon Rees Scully & Mansukhani, Chicago.

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