Former CEO Tami Longaberger sues former company

By Tim Feran
The Columbus Dispatch

Tami Longaberger is suing the basket-making company her father founded and its parent company over $1 million she loaned to the company while it was “experiencing a severe cash crisis.”

Longaberger, who resigned as CEO of the Longaberger Co. in May, alleges in the suit that in June 2014 she agreed to the loan after executives at Longaberger parent company CVSL asked her “to loan as much money as she could so that the companies could meet their immediate financial obligations.”

Longaberger agreed to make a loan to the companies, and had to “liquidate some personal investments to come up with the entire $1 million loan amount.”

But CVSL has not repaid any principal or interest, according to the lawsuit, which was filed in August in Franklin County Common Pleas Court.

After the original filing, CVSL requested more time to answer the complaint, and now faces an Oct. 12 deadline to do so.

Former CEO of basket company says she hasn’t been repaid $1 million she loaned
CVSL denied the allegations in a statement today.

“Her lawsuit is completely without merit, and we are responding through the legal process,” said spokesman Russell Mack.

The Longaberger Co. along with its former CEO are facing a suit filed in September by Columbus-based production company Mills James Productions.

Mills James alleges that after providing services at the annual Longaberger Bee in August 2014, the company owes $61,956.

Newark-based Longaberger Co. has struggled since the death in 1999 of company founder Dave Longaberger. A combination of bad economic times and changing tastes in home decor sent sales from a peak of $1 billion in 2000 to about $100 million last year. Several rounds of layoffs have occurred during the past decade, leaving the company much smaller.

In 2013, CVSL bought a 51.7 percent stake in Longaberger Co., the first of a string of acquisitions in direct sales companies.

But Dallas-based CVSL’s relations with Longaberger soured soon after.

In her resignation letter earlier this year, Longaberger explained her decision by citing several actions taken by CVSL.

Among the charges she leveled was that CVSL had: reduced her salary of $850,000 per year by $600,000 during a four-month “deferral period” that was never made up, and caused Longaberger Co. to fail to pay sales and use taxes to several states, “prompting these state taxing authorities to seek to assess me personally.”

CVSL responded by saying it had terminated Longaberger “after an internal investigation revealed that (she) engaged in substantial misconduct that has damaged the Longaberger Co. and CVSL.”

Longaberger later said she was “saddened that the people brought in to help lift the Longaberger Co. up have chosen instead to try to tear me down.” CVSL’s charges were “a transparent attempt to evade their responsibilities under my contract,” she said, adding that CVSL had “chosen to spin innuendo and false charges to justify their default.”


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