Philip Toomey Analyzes the Partnership Breakup Between Charity Co-founders and Partners in the Los Angeles Business Journal
In the article, “Dispute Sinks Ocean Eco-Charity” published by the Los Angeles Business Journal, Partner Philip Toomey comments on the lawsuit concerning the Seathos Foundation, a charity organization whose mission was to spread awareness of the human impact on oceans. Co-founder Nick Behunin alleged that his fellow co-founder Michael Schwab, son of billionaire investor Charles R. Schwab, used their charity to advance his own business activity.
Schwab denied the allegations and filed several lawsuits attempting to force Behunin and the third Seathos co-founder and partner Chris Jensen, to open the organization’s books and alleging self-dealings, citing $360,000 in contracts awarded to ASR, Behunin’s marine environment consultancy business. Behunin claims the Schwabs knew about the contracts all along.
Mr. Toomey says that Behunin’s case would eventually come down to what was actually documented. “There appears to be a lot of assumptions that were made without being reduced to writing,” he said. “This lawsuit kind of looks like an adage that business lawyers like to say, which is that it’s always better to have the hard conversations upfront before you go down the path in a business deal.”
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