David Lilenfeld, Lilenfeld PC. Photo: John Disney

Seven months after his contentious ouster as COO of Monster, controversial Miami businessman Fereidoun “Fred” Khalilian was on the losing end of a $4.7 million award to an ex-business partner.

The trial in Fulton County Superior Court centered on allegations of misappropriated investment funds, competing online gambling enterprises and a rakish wink at the jury that may have backfired.

At the end of a three-day trial, the jury found Khalilian liable for $4.7 million in damages to Atlanta website developer and internet marketer Stefano Grossi, said Grossi's attorney, David Lilenfeld of Lilenfeld PC.

Khalilian, who splits his time between Miami and Los Angeles, partnered a decade ago with Paris Hilton in two Florida nightclubs.

He was ousted by Los Angeles cable-maker Monster last year after he was labeled a “toxic” member of its management team in a corporate brawl that included a temporary restraining order against Khalilian and a police complaint alleging fraud, theft and conspiracy.

He previously ran afoul of the Federal Trade Commission, which secured a permanent injunction and $4.2 million judgment against Khalilian and his company, The Dolce Group Worldwide, in 2010. That barred him from engaging in a robocalling business that made deceptive sales of extended auto warranties.

In 2000, the FTC shut down two Florida businesses with Khalilian as a principal, Leisure Time Marketing and Discovery Rental Inc.

Grossi sued Khalilian in 2014 after investing $1.7 million in United Artists Group, which developed online poker venues for Native American tribes, Lilenfeld said.

The partnership soured “when the $1.7 million my client invested ran out,” the Atlanta attorney said. “I told the jury in my closing that when the money was gone, Fred was gone.”

After diverting Grossi's investment to his extravagant lifestyle complete with Rolex watches, a Lamborghini sports car and stays at deluxe hotels, Lilenfeld said Khalilian set up a mirror company, Universal Entertainment Group, and began marketing the development of online gambling websites to other Native American tribes and, eventually, to Monster.

“My client's position was there never really was a split,” Lilenfeld said. “It wasn't a formal end to the partnership. Fred just went on his merry way.”

Grossi offered the tech expertise in the partnership, Lilenfeld said.

“Fred had the connections. He was the dealmaker,” the attorney said. “My client had the expertise to oversee the development of the website and to market it. … He was able to oversee all the technical aspects. Fred walks into a room with a nice suit and charms everybody. Not a lot of people can do that.”

Khalilian displayed that braggadocio on the witness stand, Lilenfeld said. Recounting his first meeting with Grossi, Khalilian told the jury he drove a $1.1 million vehicle to the meeting and then winked at jurors, Lilenfeld said.

When Lilenfeld talked to jurors after the trial, he said they expressed distaste for the defendant. “They singled out the winking,” he said.

The award reimbursed Gross for his 50 percent share of a $9.4 million deal that Khalilian struck with the Cheyenne and Arapaho Tribes of Oklahoma based on the online poker application Grossi developed for United Artists, Lilenfeld said.

The jury declined to award Grossi a percentage of earnings that Khalilian generated in his deals with Monster and another Oklahoma tribe, finding too much time had elapsed between Khalilian's partnership with Grossi and deals he subsequently generated through his new company, United Entertainment, Lilenfeld said.

Bryan Knight of Atlanta's Knight Johnson, who defended Khalilian, said he and Khalilian “are obviously disappointed with the jury verdict.” But there was a “somewhat of a silver lining” because Lilenfeld asked for $30 million plus punitive damages and legal fees, Knight added. In addition to limiting its verdict to $4.7 million, the jury declined to award either punitives or fees.

Knight said he intends to ask Judge Jerry Baxter to halve the award. Although Grossi was the sole plaintiff, Knight contended he actually sued on behalf of United Artists.

“This was really a judgment for United Artists Group,” he argued. Because Grossi and Khalilian were 50 percent partners, half the verdict should be credited to Khalilian.

Knight also said he and Khalilian “envision an appeal based on certain evidence that was excluded at trial.” He declined to elaborate.