August 24, 2013 in Business

Actor sues partner in Tully’s purchase

Melissa Allison Seattle Times
 
Mike Siegel photo

Patrick Dempsey meets the staff at the Tully’s Coffee on Western Avenue in Seattle near the Pike Place Market on Jan. 4 after his investment group won a bid to purchase the chain. Dempsey sued partner Michael Avenatti on Tuesday, alleging financial mismanagement.
(Full-size photo)

Acquisition cost

Actor Patrick Dempsey and investor Michael Avenatti agreed to spend $9.15 million to buy Seattle-based Tully’s Coffee out of bankruptcy court on Jan. 3.

SEATTLE – Actor Patrick Dempsey has sued his partner in the company that bought Tully’s Coffee out of bankruptcy, charging the partner deceived him by not fully financing the deal and borrowing against Tully’s assets instead.

Dempsey himself agreed to contribute no money to the acquisition, he said in court filings as part of a lawsuit he filed Tuesday against Michael Avenatti, his partner in Global Baristas.

“My decision to become a member and manager of Global Baristas was based, in part, on Michael Avenatti’s representation that he would provide both the capital to fund the entire Tully’s acquisition and sufficient working capital to allow Global Baristas to operate the Tully’s Coffee stores once the acquisition was completed,” Dempsey said in a statement filed with the lawsuit in King County Superior Court.

Instead, he said, Avenatti used Global Baristas to borrow $2 million for working capital without telling him. The loan carries an “exorbitant” interest rate of 15 percent annually, the suit says.

In addition, Dempsey said he is pursuing arbitration “to address several personal claims I have against Michael Avenatti that arise out of or relate to his actions with respect to Global Baristas.”

Avenatti said in an email that “We expect the lawsuit to be dismissed by Patrick in its entirety today. This is much ado about nothing.”

Dempsey learned about the $2 million loan through a business adviser who found through an Internet search that Global Baristas had borrowed the money, according to filings.

His lawyer, David Goodnight of the Seattle firm Stoel Rives, declined to comment. The voice mailbox of his publicist, Ruth Bernstein, was full and not accepting messages Friday morning.

Dempsey and Avenatti bought Tully’s for $9.15 million in a bankruptcy court auction earlier this year. Their bid was upheld by a bankruptcy court judge who heard other bidders, including Starbucks, spar over whether they were the rightful winners.

The deal closed June 30, five months later than expected.


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