A former Taco Time restaurant operator who claims to be the victim of real estate fraud has dropped his lawsuit against T.J. Toney and Toney Properties LLC.

J. Ronald Brooks agreed to dismiss Toney, who owns the restaurant property on S. Third Street at Reed Lane in Bend, from the Deschutes County lawsuit, according to a dismissal order issued Nov. 2 by Circuit Judge Walter Miller. As part of the settlement, Brooks also agreed to drop his claim that he would have the right to buy the property.

The settlement cleared the way for Toney to sell the property, and a sale is pending, said Toney’s attorney, Gordon Welborn of Hart Wagner LLP.

The restaurant has been shuttered since at least September, but Brooks’ troubles began more than two years ago, according to the lawsuit, which is still pending against real estate agent Joshua Rodriguez and his affiliated firm, Homesmart Central Realty. The lawsuit alleges fraud, elder abuse, breach of contract and breach of fiduciary duty and seeks more than $1.2 million in economic and noneconomic damages.

Brooks contends that Rodriguez offered to connect him to private lenders who could help him avoid foreclosure on the Bend Taco Time by Wells Fargo, which was owed $690,000. Instead, Brooks sold the Bend Taco Time, plus two other properties in Redmond and Madras in March 2015. Then Brooks entered a lease with the option to repurchase the Bend property from Toney.

Brooks’ lawsuit claims Rodriguez, who was paid $60,000, didn’t disclose that he also worked for Toney, and that he strung Brooks along until foreclosure was imminent, so that Brooks wouldn’t seek bankruptcy protection.

Brooks had ample time to weigh alternatives to the deal and didn’t consult with attorneys, said Rodriguez’s attorney, Martin Hansen, a partner at Francis, Hansen and Martin LLP in Bend. Rodriguez now lives in California.

In a court filing, Hansen argued that Brooks’ lawsuit is an attempt to shift blame after he defaulted on his lease earlier this year. “For two years plaintiffs operated under the parties’ agreements without complaint.”

Hansen pointed out that Brooks and his wife filed for Chapter 13 bankruptcy protection in April.

While dealing with Rodriguez in 2015, Brooks had plenty of time to consult with attorneys and didn’t do so, Hansen said. Brooks also signed a document that released Rodriguez from liability, he said. “It was just to avoid this kind of lawsuit,” he said.

Brooks’ attorney, Bruce Moore of Eugene, has argued that the release is invalid because it was obtained fraudulently. The release was hidden in a stack of documents that Brooks signed quickly on March 20, at the same time he entered a lease with Toney and the same day of the scheduled foreclosure, according to a statement filed in the lawsuit.

— Reporter: 541-617-7860, kmclaughlin@bendbulletin.com