LuLaRoe's founders have been linked to 31 LLCs set up during the last 3 years - and a lawsuit alleges they're attempting to shield assets like a Gulfstream jet, a ranch in Wyoming, and a world-record-breaking supercar named Ruthie
- A lawsuit alleges that LuLaRoe founder and CEO Mark Stidham and a number of associates are hiding money and assets in a web of LLCs.
- Stidham and his associates are connected to at least 33 LLCs set up between 2015 and the present day, according to documents reviewed by Business Insider. Thirty-one of these LLCs are still active.
- The majority of these LLCs also list LuLaRoe's Corona, California "hub" as a principal office.
- In its lawsuit, manufacturer Providence Industries claims a number of these LLCs are linked to assets such as a world-record-breaking car worth over $2 million and a lush ranch in rural Wyoming.
- "We believe the claims in this case are completely without merit and will fight vigorously against them," a LuLaRoe spokesperson told Business Insider in a statement.
LuLaRoe's manufacturer has filed a lawsuit against the legging empire, alleging that the company and its leaders are playing a shell game in order to avoid paying creditors.
Providence Industries, LuLaRoe's clothing supplier, is suing its client for $49 million. The lawsuit alleges that LuLaRoe founders Mark and Deanne Stidham, along with their business associates and relatives, have transferred "substantial assets" to both themselves and their family members in order to support "lavish lifestyles" and avoid paying creditors.The lawsuit specifically identifies 17 limited liability companies, which the plaintiff claims are used to hide assets like "exotic race cars, airplanes, warehouses, residences, and raw land."
"We believe the claims in this case are completely without merit and will fight vigorously against them," a LuLaRoe spokesperson told Business Insider in a statement. "Given this is pending litigation, we cannot comment on the specifics."
What's more, Mark Stidham submitted a sworn declaration to "address some of the patently false statements" in Providence Industries' filing. He said that the limited liability companies mentioned in Providence Industries' lawsuit were real estate and investment holding companies with "no nefarious or improper purpose."
Business Insider has reviewed documents linking LuLaRoe and its founders to 31 still-active LLCs established in the last three years. Two additional Wyoming-based LLCs - Varldspela LLC, which was filed on April 10, 2018, and Bradham Investment Holdings, which was filed on September 18, 2017 - were both dissolved on June 18, 2018.
Here's a look at the web of LLCs and luxurious assets surrounding LuLaRoe, its founders, and their associates: