Hunter-Reay wins $3.3M suit against Gentilozzi

Above: Ryan Hunter-Reay races on the streets of Toronto in 2005.

IndyCar champion and Indy 500 winner Ryan Hunter-Reay has won an ongoing lawsuit against former Champ Car team owner Paul Gentilozzi and his racing team, RSR Racing.

Federal Judge Robert Holmes, in Grand Rapids, Michigan, has ruled in favor of Hunter-Reay's company Ryan Racing on the grounds of wrongful termination and disparagement of character. Hunter-Reay drove for Gentilozzi's Michigan-based Rocketsports team during an abbreviated 2005 Champ Car season.

• INSIGHT: Hunter-Reay's case against Paul Gentilozzi

Judge Bell brought an end to the protracted lawsuit, which began in 2007, by awarding Hunter-Reay $3,283.844.56 total from Gentilozzi's modern version of Rocketsports, RSR Racing and Gentilozzi as an individual.

"This has been going on since 2007 and it's never something I wanted to be part of," Hunter-Reay told RACER. "After a bunch of delays, we finally had a federal court rule in our favor. Contracts were breached, a campaign to disparage my reputation took place and the consequence was it cratered my career. The unfortunate thing is how long this has dragged on."

To recoup monies owed to Hunter-Reay, the court ordered all of Gentilozzi's personal property and his primary business, Gentilozzi Real Estate, to be seized on Feb. 15. A writ to seize property owned by RSR Racing was also filed the same day. In addition to the court-ordered seizures, Hunter-Reay's lawyers are also seeking direct garnishment of Gentilozzi's wages to expedite the acquisition of the roughly $3.3 million owed to their client.

Earlier this week, U.S. marshals arrived at RSR Racing's shop in East Lansing, Michigan, to begin the asset seizure process, and left with numerous items belonging to Gentilozzi. It is the same shop where, under the "3GT Racing" banner, Gentilozzi runs a factory sports car program on behalf of auto manufacturer Lexus (pictured).

According to a statement provided to RACER by 3GT Racing, the federal ruling will not impact its ability to field the Lexus RC F program in IMSA's WeatherTech SportsCar Championship, and Gentilozzi will seek to have Judge Bell's decision overturned or seek a new trial if the appeal fails.

"As part of a long running lawsuit between RSR Racing, Paul Gentilozzi and Ryan Racing, a judgment was entered in favor of Ryan Racing on January 31, 2017," the team said. "RSR Racing and Mr. Gentilozzi are disappointed with the result and are confident that the ruling will eventually be overturned. They have filed a motion with the court for a new trial and, if unsuccessful, are confident that an appeal of the decision will result in its reversal.

"Regardless, Ryan Racing has begun efforts to collect on the judgment. On February 20, 2017, a process server for Ryan Racing appeared at Mr. Gentilozzi's office and obtained property of RSR and Mr. Gentilozzi. None of the items taken belonged to 3GT Racing and 3GT Racing's ability to race is not affected by the lawsuit.

Signed to a full-season Champ Car contract with Rocketsports starting in 2005, Hunter-Reay was fired by Gentilozzi with two races remaining in the season. He was replaced with Finlay Motorsports sports car driver Michael McDowell, who allegedly paid Rocketsports $150,000 for the opportunity.

According to the complaint, Hunter-Reay's contract with Rocketsports did not allow the team to terminate his services, and it also contained non-disparagement verbiage. After being removed from the Rocketsports Champ Car ride, Hunter-Reay's career and personal finances fell into a well-documented freefall.

Other than taking sporadic drives in the Grand-Am sports car series, Hunter-Reay was unemployed for most of 2006 and through the first half of 2007 until the Rahal Letterman Racing IndyCar team came calling.

The new federal decision comes after the 2007 lawsuit was filed at the state level. The original lawsuit resulted in a 2009 Michigan District Court order where Hunter-Reay was awarded the $2.7 million through arbitration. Collecting the award proved troublesome when, according to the timeline in the complaint, Rocketsports was folded two weeks before the court made its $2.7 million ruling against the company.

An immediate successor to Rocketsports emerged after its closure. RSR Racing, owned by Gentilozzi and his two sons, occupied the same building with essentially the same staff and assets as Rocketsports. With the new RSR Racing company serving as a separate entity than the one ordered to pay Hunter-Reay, attempts to collect the $2.7 million judgement were thwarted from 2009-17.

The next course of action saw Hunter-Reay's lawyers file new federal lawsuits that aimed to hold Rocketsports' successor, RSR Racing, and Gentilozzi, the owner/founder of both companies, liable for the $2.7 million debt.

The federal case, which centered on claims of "Successor Liability" and involved "Piercing the Corporate Veil," was presided over by Judge Bell and led to a decision on Jan. 31 that awarded the original amount of $2.7 million to Hunter-Reay and interest of $562,000, for a total of almost $3.3 million.

Judge Bell's decision also called for the immediate payment of the $3.3 million to Hunter-Reay by RSR Racing and Gentilozzi. Nonpayment of that amount resulted in the seizure efforts currently in motion by the U.S. Marshals Service and the garnishment efforts by Hunter-Reay's legal team.