A Saco developer who proposed high-profile projects in Saco and Portland denies a former business partner’s claim that he embezzled money from the company they founded, and instead blamed the partner for the business’ financial troubles.

In the lawsuit filed last month against Bernard Saulnier in York County Superior Court, real estate broker John Veneziano says Saulnier took money from J&B Partners LLC, the business they created to develop projects in Portland and Saco, to pay for other business dealings and Saulnier’s personal debt.

But Saulnier argues in a legal response that it was Veneziano’s failure to secure $32 million in loans that led the company to run into financial trouble, culminating with foreclosure auctions on properties in the two cities.

Saco Island, which lies between the downtowns of Biddeford and Saco, was the site of a proposed $40 million development that would have included a mix of apartments, a boutique hotel and a marina. Press Herald file photo

Saulnier also said in the filing that Veneziano drove away a prospective tenant, Nonesuch Brewing, when he sexually harassed an employee of the company. Nonesuch Brewing’s owner said Monday that while Saulnier’s partner was asked to leave the business for being disrespectful to staff, the brewery never pulled out of the project and would still like to be part of it.

Sean Beagan, a Massachusetts attorney who represents Veneziano, said his client “vehemently denies” the allegations of sexually inappropriate conduct.

“There is no truth to them, as far as Mr. Veneziano is concerned,” he said.

Beagan said he could not comment further on the allegations made by Saulnier, but said Veneziano’s response to them will be reflected in an upcoming court filing from his local attorney, William Gallitto of Bergen & Parkinson. Gallitto did not respond to multiple interview requests Monday.

Saulnier and his attorney, Clifford Ruprecht, also did not respond to interview requests Monday.

The Saco property auctioned off earlier this month was supposed to be the location of an ambitious $40 million development on Saco Island called The Waters that would have included condominiums, a hotel and a marina. Also sold at auction was a property on Chestnut Street in Portland, where Saulnier had approval to build 53 apartments over an existing parking garage. The future of both projects is unclear.

A third property owned by J&B Partners at 155 Sheridan St. in Portland is scheduled to be auctioned on Aug. 8. Saulnier won approval in 2017 to build 19 condos on the land on Munjoy Hill, although that project was delayed to address concerns about obstructing views from Fort Sumner Park.

The initial lawsuit alleges that after Veneziano raised $6 million for J&B Partners, Saulnier did little to develop J&B’s projects and “squandered, embezzled and stole” its liquid capital by paying off his personal debts and those of Saulnier Development LLC. Gallitto says in the lawsuit that ledgers produced by bookkeepers “clearly demonstrate that Mr. Saulnier has been embezzling and stealing money from J&B since its inception.”

“Mr. Saulnier has used J&B’s assets to support a lifestyle that he could not otherwise afford, pay off personal debts, debts of Saulnier Development LLC, and, upon information and belief, debts of other entities he controls,” Gallitto wrote in the lawsuit.

In a response and counterclaim filed last week in York County Superior Court, Saulnier denies the allegations – including that Saulnier used J&B Partners’ money for personal expenses – and says Veneziano caused J&B Partners to run into financial difficulty. Veneziano “held himself out to Saulnier Development as having expertise in obtaining financing for commercial real estate projects” and promised to obtain $32 million in loans through his connections to wealthy Chinese investors, according to the lawsuit.

Saulnier says in his filing that Veneziano never obtained loans from Chinese investors and stopped trying to obtain financing for J&B Partners’ projects “without raising anywhere near $32 million.”

“By ceasing raising funds for J&B Partners, LLC, Mr. Veneziano impaired the entity’s ability to see its projects through to construction,” Ruprecht wrote in the counterclaim filed July 16. “Due to Mr. Veneziano’s unjustified cessation of capital-raising activity, J&B Partners, LLC experienced financial difficulty.”

Saulnier’s court filing also alleges that Veneziano “willfully” tried to alienate potential business partners, including threatening to sue Ted Moore, who ultimately bought both the Saco and Portland properties at auction. Further, Veneziano engaged in “sexually inappropriate conduct towards an employee of Nonesuch Brewing, leading that entity to cease all efforts to participate in or support J&B Partners LLC’s project in Saco, Maine,” according to the lawsuit.

Tim Boardman, an owner of Nonesuch Brewing, said Monday that Veneziano did go into Nonesuch Brewing and was asked to leave after being disrespectful to staff, but “that was the end of it.”

“We never pulled out of The Waters project,” Boardman said. “We continue to be very excited about that project and hope it can move forward … We think the concept is a great concept.”