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Keller Williams, Gary Keller and former KW CEO John Davis are ramping up their legal battle.
On Friday, Keller Williams co-founder and chairman Gary Keller, who is a defendant in the suit, filed a document asking the court to make Davis pay for what he claims are “baseless attacks” against him, his company and family members, claiming that Davis is attempting to “bully and intimidate” him through this suit.
Both Keller and his firm have again asked the court to hold Davis in contempt. They would also like the court to strike filings containing what they feel are attacks from the docket and order Davis to pay their attorneys’ fees.
The filing at the center of this debate was submitted to the court in late January of 2025. In the filing, Davis and former Arizona franchise owner Jesse Herfel claim that a former Keller Mortgage employee was fired after accusing John Keller, the company’s executive vice chairman and the son of Gary Keller, of sexual misconduct and that the incident was covered up by the company’s general counsel Stacie Herron. According to the filing, Gary Keller gave the accuser $1 million of his own money to pay her off and then gave Herron a $1 million bonus and a promotion to interim COO for carrying out the alleged cover up.
Originally filed in August 2023 and refiled in December of 2023, Davis’ racketeering suit makes claims of financial impropriety against Gary and John Keller, former KW president Josh Team, Business MAPS Ltd., Business MAPS Management LLC, 72Sold, Johnathan Dupree, Marc King, Jason Abrams, Matt Green, William Soteroff, KWx, Livian and KW Southwest Region as defendants. According to the initial complaint, after franchisees signed a contract, the defendants then required franchisees to adopt KWRI’s present market cap, which is the fee agents pay to their market centers. Davis alleges that these fees went to increasing technology fees and the purchase of “unneeded goods and services” from KWRI-owned and affiliated companies, such as MAPS training and coaching.
Davis took things a step further in his January 2025 filing, claiming that Gary Keller, John Keller, Stacie Herron, Josh Team and Mark Willis “misappropriated, diverted and embezzled” millions in fees through KWx. Additionally, the plaintiffs allege that Team received $10 million in kickbacks, and that Mary Pfluger, Gary Keller’s wife, gave Jonathan Dupree, the southwest regional director, an off-the-books check for agreeing to the market cap cut directive given by Gary Keller.
In a reply brief filed earlier this year, attorneys from Akin Gump Strauss Hauer & Feld, the counsel for the defendants, have claimed that the plaintiffs are using the court and public filings “to pursue their personal vendetta and disparaging campaign against Defendants must end.”
Davis’ legal battle with Keller Williams began after sexual misconduct allegations against him came out in 2022, three years after he left the firm. The allegations against Davis were dismissed in 2023.
