March 29, 2006

Los Angeles Times Workers Fear Imminent Lightning Strike

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Workers at the Los Angeles Times are rumored to be crippled by fear of lightning, locusts, plagues or other pestilence after the Times printed an article about Thomas Kinkade, the famous Christian-themed “Painter of Light.” According to this article, Kinkade’s Light doesn’t always shine on those around him. Kinkade may also be known one day as the Litigator of Light; he is, or has been, involved in nine arbitrations. Of the four claims that have been arbitrated, Kinkade has won three. While five more arbitrations are pending, a three-member panel of the American Arbitration Association last month entered an interim award against Kinkade’s company, ordering it to pay $860,000 for defrauding the former owners of two failed Thomas Kinkade Signature Galleries in Virginia. While Kinkade’s lawyer said he would seek to void the award (although the article doesn’t say on what basis), the claimants’ lawyer, Norman Yatooma, is quoted as saying that the award could quadruple when interest, legal fees and other costs are added. You do the math.

But no ordinary fraud claim involving an iconic Christian Light Painter this. In addition to finding that Kinkade’s company and one of its executives (not Kinkade) defrauded the claimants by withholding pertinent information that would have kept them from investing $122,000 to open their Gallery in 1999, the panel found that Kinkade and other company executives created a “religious environment to instill a special relationship of trust” -- a sort of faith-based fiduciary duty -- with the claimants. As evidence supporting this finding, the panel found that the company used terms such as “partner,” “trust,” “Christian” and “God” to convey a sense of a “higher calling.” More interesting, at least to yr crrspndt, are the allegations regarding Kinkade’s business and personal behavior made in this and other proceedings and in interviews. On the business side, lots of allegations about pressure on Gallery dealers to oversaturate their markets, Kinkade letting Gallery owners fail in order to drive down the company’s stock price so that he could take it private and Kinkade earning over $50 million for his work from 1997 through May 2005, while Gallery owners suffered financially. On the far more intriguing personal side -- allegations by former employees that they often went with Kinkade to strip clubs and bars where he frequently became intoxicated and out of control; that at one time he was so intoxicated during a performance of Siegfried & Roy in Las Vegas that people seated nearby moved away from him ( . . . at a Siegfried & Roy performance, Mr. Kinkade?); incidents in which Kinkade berated and shouted obscenities at a woman trying to help him to his feet in a bar and “ritual territory marking.” That’s right, ritual territory marking is what they call it -- one former Kinkade employee testified that during a trip to Orange County in the late 1990s, he and Kinkade returned to the Disneyland Hotel after a night of heavy drinking. “Thom wanders over to Winnie the Pooh and decides to ‘mark his territory,’” the employee testified. Guess how? Oh, Bother!

The article goes on to state that in a deposition, Kinkade alluded to his practice of urinating outdoors, saying he “grew up in the country,” where the practice is apparently common. Our nomination for best line in the entire article is this, “When pressed about allegedly relieving himself in a hotel elevator in Las Vegas (not exactly outdoors), Kinkade said, ‘there may have been some ritual territory marking going on, but I don’t recall it.’”

Kinkade and his lawyers deny the arbitration claimants’ allegations and attribute many of the above accusations to the rantings of disgruntled employees (except for maybe the ritual-urinating-territory-marking-thing). While not addressing specific incidents in his response to the Times’ written questions, (you really should read the whole article), Kinkade did sum things up nicely, “It does disappoint me when people who I have tried to help and befriend make crazy allegations about me. I am a big fan of imagination, but the specific allegations you have described to me are ridiculous and I feel like the victim of a legal stalker.”

Posted by franchiselawblog at March 29, 2006 02:40 PM