'This is nonsense': LuLaRoe CEO fires back at $49 million supplier lawsuit, saying he has no plans to 'jump ship'
- LuLaRoe CEO Mark Stidham fired back at a supplier's $49 million lawsuit against the multi-level marketing company, saying some of the suit's supporting testimonies are "patently false" and "nonsense.
- The supplier, Providence Industries, claimed in the suit that Stidham is a flight risk because of his alleged threats to "jump ship" with the company's riches.
- Stidham said he has no plans to abscond with the company's money.
- "To be clear, I do not have, and have never had, any intention or plans of absconding abroad with money," he said.
- Another hearing on the matter is scheduled for Friday morning.
LuLaRoe CEO Mark Stidham has fired back at a supplier's $49 million lawsuit against the multi-level marketing company, saying some of the suit's supporting testimonies are "patently false" and "nonsense."
The supplier, Providence Industries, said in the suit LuLaRoe has failed to pay its bills for seven months, and accused the company's founders, Mark and DeAnne Stidham, of hiding assets in "shell" companies to fund their "lavish lifestyle."During a hearing in California state court on Wednesday, Providence Industries demanded the immediate seizure of nearly $34 million in assets from LuLaRoe, claiming that Mark Stidham is a flight risk because of his alleged threats to "jump ship" with the company's riches.
Executives from Providence Industries and LuLaRoe's former chief designer, Patrick Winget, filed sworn statements in support of some of the lawsuit's claims.
In response, Stidham said he has no plans to flee with the company's money, according to a copy of Stidham's testimony that was filed in court on Wednesday.
"To be clear, I do not have, and have never had, any intention or plans of absconding abroad with money," he said. "To the contrary, I remain committed to the LuLaRoe business and continue to work daily on the business."
Stidham went on to identify four LuLaRoe properties, including three warehouses and a commercial office space, and said the company is current on its rents for all of those properties."The suggestion that I would abscond with hundreds of millions of dollars from LuLaRoe and escape to the Bahamas - or anywhere else for that matter - is absurd," he said, and "testimony to that effect is reckless, misleading, and insulting."
In relation to the lawsuit's claim that Stidham had created 17 "shell" companies between July and December 2017 to hide assets, he said, "this is nonsense."
Sitdham said the companies "consist of real estate and investment holding companies, some of which were created for real estate-planning purposes."
"There is no nefarious or improper purpose as to why these entities were formed."
Stidham also addressed a sworn statement by Winget, who was LuLaRoe's chief designer from 2013 until September 2018.
Winget had claimed that Stidham made several alleged threats to flee with the company's money.
Stidham denied making such statements to Winget and referred to him as a "disgruntled former LuLaRoe employee whom I terminated earlier this year."LuLaRoe representatives told Business Insider earlier this year in an e-mailed statement that Winget had "decided to step down from his role, and pursue other opportunities."
Another hearing on the case is scheduled for Friday morning.