opengate capital lawsuit

Federal Civil Lawsuit California Central District Court, Case No. Stanziale alleged that the dairy was insolvent in December 2011, more than a year before the hurried shutdown. It would curb the industrys worst abuses and prioritize people, not private equity profits. The lawsuit was dismissed in April 2016. It was rough, but they didnt care. To date, OpenGate has laid off 678 California workers from the Pennysaver classified ad magazine, 100 Wisconsin workers at its Golden Guernsey dairy plant, 140 employees of the Connecticut boxboard company Fusion Paperboard, and nearly 200 employees in Texas, Arkansas, and Wisconsin, who worked for Hamilton Scientific, an OpenGate-owned laboratory furniture company. Its not like they didnt know they had to give 60 days notice, and its not like they didnt know there were some significant financial issues, said Richard McCune, a Redlands lawyer who filed a lawsuit seeking class-action status on behalf of former employees. We look to establish collaborative relationships with companies to drive operational improvement and realize opportunities for long-term value creation. OpenGate Capital General Information. Later that year, Nikou led OpenGate Capital's bid for McGraw-Hill Companies BusinessWeek magazine, then withdrew from the bidding. Instead, he sits on numerous boards and hes even been in talks about a reality TV show built around his private equity business. This article was originally published on OtherWords. Founded in 2005, OpenGate Capital is a private equity firm based in Los Angeles, California. OpenGate is moving the plant to Mexico anyway. Nikou was not named as a defendant in the suit. But Pawluk said things deteriorated soon after OpenGate Capital acquired Hufcor, a family-owned company founded in Janesville 120 years ago. OpenGate has had successes. (Reuters) - Opengate Capital Group LLC filed a lawsuit on Friday alleging that laboratory equipment maker Thermo Fisher Scientific Inc. sold it a Mexican plant last year without revealing that a drug cartel was operating there. We work with every customer to find a workable solution, but unfortunately we werent able to reach an agreement in this situation. He declined to comment further. But there were no stocks because the elder Darden was never a part of the deal, it is alleged. It agreed to provide $3.1 million in . Newkirk was fully involved in the scam, prosecutors allege. Capital One said it tried to work with PennySaver on the closure, but to no avail. To date, the firm has completed more than 75 transactions, including . But in court papers, Hamilton denied any illegal conduct. Further explore our recent investment activities and quarterly reports, 2023 OpenGate Capital Management, LLC. Over the past three years, OpenGate Capital has shut several of its portfolio companies, laying off employees with little to no warning in some cases. I find it to be despicable.. [17][18][19], In July 2016, OpenGate closed its first institutional fund, OpenGate Capital Partners I, at $305 million, exceeding its target of $300 million and raising about twice what the average new private equity fund does, according to Preqin. Mr. Moazami's career spans 30+ years in the technology industry; predominantly in operating roles and the last nine years as a professional venture capitalist & advisor in Silicon Valley. [10], In 2008, Nikou negotiated the deal for OpenGate Capital to acquire TV Guide for $1 and $50 million in assumed liabilities from owner Rovi Corporation (previously Macrovision). Power Partners Inc., the first investment completed in OpenGate's first fund, was realized in November 2019 through the sale to Pioneer Transformers, a portfolio company of Mill Point Partners. Established in 2005, OpenGate Capital is headquartered in Los Angeles, California with a European office in Paris, France. In her letter to OpenGate Capital, Baldwin writes, "Your predatory actions in Wisconsin are a powerful example of the urgent need for these reforms." A copy of Senator Baldwin's letter can be found here and below. Thats the thing that bothers us most, McCarthy said. [35][36][37], Nikou is married with children and resides in Nevada.[7]. Nikou increased OpenGate's pace of international acquisitions in the 2010s. $16 hourly wages and generous benefits as recently as January 2021. OTHER FILED BY OPENGATE CAPITAL LLC ON 07/15/2015 [+] Read More [-] Read Less; 07/16/2015. OpenGate has a history of buying companies only to close operations shortly thereafter, leaving communities across the country in the lurch. However, after making a few payments, Fusion defaulted on a loan from the state of Connecticut, said State Sen. Cathy Osten, who is also the first selectman of Sprague the small town where Fusion was the main employer. In fact, prosecutors allege, it was the senior Dardens neer-do-well son who had already spent three years in jail on an unrelated stock swindle looking to buy the lad mag. E-FILING TRANSACTION 2392305 RECEIVED ON 07/15/2015 . This spring, Hamilton Scientific, a De Pere, Wis., lab equipment maker owned by OpenGate, abruptly shut down, laying off 80 people there and 190 at plants in Texas and Arkansas without notice, according to a lawsuit filed by former employees. (Photo provided by Americans for Financial Reform). All rights reserved. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); Thanks for contacting us. OpenGate Capital, the private equity firm that owns their employer, Hufcor, announced it was moving their plant out of Janesville taking those workers jobs and livelihoods with it. In 2011, the firm acquired NorPaper Avot Valle, a specialty paper manufacturer based in France. But Fusion closed the plant only a year and a half after receiving the loan, Osten said. PennySaver workers are suing OpenGate in state and federal court, alleging that the company failed to provide adequate notice about the shutdown. OpenGate nevertheless was lured back in as a short-term lender to Darden. Andrew Nikou is the founder and CEO of OpenGate Capital, a global private buyout firm. Grace Matthews advised Chemsolv on the transaction. The lawsuit, filed in federal court in Los Angeles, alleged that Thermo Fisher had acted in bad faith by withholding documents and directing employees to conceal the drug gangs presence at the facility. On May 27, 2021, 166 workers in Janesville, Wisconsin awoke to a nightmare. The company was starting to be profitable. OpenGate Capital Management has sued the British parent company of a German industrial engine-maker to recover fees after the private equity firm's 347 million ($480 million) deal to buy the . The firm first gained recognition for the acquisition of TV Guide Magazine in December 2008,[2] and the publication's turn to profitability in the first quarter of 2010.[3]. Most of my clients are in default. The cases that former employees have highlighted as OpenGate failures include: the shuttering of Golden Guernsey on a Saturday morning in 2013, with no notice to employees; the closure of Connecticut-based Fusion Paperboard shortly after it had received a state loan to stay put for 10 years; and the shutdown of OpenGates laboratory furniture business, Hamilton Scientific, after it discovered that a drug cartel had overrun its Mexico plant and it was evicted from its Texas facility. With its global presence and deep focus on target sectors and investment types, OpenGate is known to bring innovation and transformational value to complex transactions. June 16, 2021. Type: Company - Private. 1 at 17.) Several lawsuits had been filed claiming OpenGate and did not follow proper protocol under the WARN Act when firing hundreds of employees from both PennySaver and Hamilton Scientific. The trustee, Charles Stanziale, said OpenGate made no net investment in the dairy after its initial purchase and the value was consistently eroded over the months leading to bankruptcy. They just care about lining their pockets with money. RSI operated PennySaver until its closure in May. Employees of other OpenGate companies have suffered similar fates. In December 2014, OpenGate Capital hired Realization Services, an East Coast company specializing in turnaround management. A native of California, Lauren attended Cal State Long Beach where she majored in journalism and political science. OpenGate Capital, a Los Angeles firm that amassed $5 billion in revenue during its first decade in business, has run exactly that playbook in Janesville since acquiring Hufcor in 2017. OpenGate Capital is a global private equity firm specializing in the acquisition and operation of businesses to create new value through operational improvements, innovation, and growth . Paris Area, France. Several pre-fund, legacy investments that were made with the personal capital of Andrew Nikou and the Partners at OpenGate Capital were sold: Benvic was sold to InvestIndustrial in December 2017, NorPaper Avot-Vallee was sold in 2018 to a private investor, and in January 2019, NAKAN (the largest division within Ivy Group) was sold to Westlake Chemical Corporation. Banks dont do this. Every major bank in the U.S. covers the payrolls.. 20201 an 1 mois. LOS ANGELES, August 23, 2022 -- ( BUSINESS WIRE )-- OpenGate Capital, a global private equity firm, announced today it . Contact the writer: 714-796-2286 or lwilliams@ocregister.com. . Lawyer Harvey Newkirk, formerly with the Bryan Cave firm, this week sits in the legal dock in Manhattan federal court, accused of concocting a fraud with Calvin Darden Jr., a convicted felon, to rob investors of millions of dollars by falsely presenting successful businessman Calvin Darden Sr. as the leading force behind the deal. So far, six lawsuits have been filed against OpenGate Capital and/or PennySaver in local and federal courts for failing to notify employees of mass layoffs, according to Richard McCune, a lawyer representing PennySaver employees. All in the name to make us more efficient. The younger Darden pleaded guilty to his own Maxim-related fraud charges in November and is cooperating with prosecutors in their pursuit of Newkirk. "Investment firm to buy Dean Foods dairy plant," BusinessWeek, 8-15-2011, Esperanza Azteca America launches first program in Los Angeles, Los Angeles Department of Water and Power, http://articles.businessinsider.com/2011-08-16/wall_street/29980017_1_private-equity-platinum-equity-pehub, http://www.themiddlemarket.com/maj/2010_25/andrew-nikou-213884-1.html, "Bullied as a Kid, This Founder Now Runs a $5 Billion Company. Last year, an OpenGate portfolio company called Fusion Paperboard in Sprague, Conn., shut down, eliminating 145 jobs and defaulting on the $1.8-million balance of a state-subsidized loan, according to the state Department of Economic and Community Development. Hufcor, a market-leading producer of accordion-style doors and mobile room partitions, was profitable when OpenGate bought it. [14] Also in 2019, OpenGate purchased the UK-based Duraco Specialty Tapes, which then acquired Infinity Tapes the following year. "Meet The Private Equity CEO Who's In Talks For His Own Reality Show," Julia La Roche, Business Insider, 8-16-2011. Nikou was born in 1977 in Vancouver, British Columbia, Canada. And employees became increasingly worried when PennySavers CEO, vice president of finance and the vice president of human resources all quit, Buckley said. Employees at other OpenGate-owned companies have voiced similar complaints. OpenGate Capital. We look to establish collaborative relationships with companies to drive operational improvement and realize opportunities for long-term value creation. The owner, private equity firm OpenGate Capital in Century City, had turned over management of the firm in December to a restructuring and liquidation company, Realization Services Inc. in Bedford . The acquisition financing was arranged via a unitranche by Deutsche Bank as . Nikou is actively involved with the management of each of the companies held in the portfolio. [33] In 2014, Nikou announced that he was forming a partnership with businessman Ricardo Salinas to bring Esperanza Azteca Youth Orchestra to Los Angeles through a partnership with the city's mayor, Eric Garcetti. The firm faced six different lawsuits after abruptly laying off Pennysaver employees in the middle of a work day and failing to give workers their final paychecks. . On 09/21/2021 Finsa Portafolios, S A de C V, filed a Property - Personal Property Fraud lawsuit against OpenGate Capital, LLC,. OpenGate, which Nikou started in 2005, has engaged in more than two dozen transactions. The labor union that represents workers at Janesville's Hufcor factory is now pressuring Hufcor owner OpenGate Capital with a shame campaign that's playing out in Los Angeles, OpenGate's . Please prove that you're human. At their side are elected officials who know that the whole country needs tough measures to reform private equity. OpenGate is a global private equity firm that acquires and . These people have no idea what theyre in for, said Joanna Storm, whose husband, Robert, was abruptly laid off from OpenGate-owned Golden Guernsey Dairy in Waukesha, Wis., after working there 19 years. Revenue: $1 to $5 billion (USD) Competitors: Unknown. OpenGate Capital Group LLC et al v. Thermo Fisher Scientific Inc, Court Case No. Thermo Fisher, the world's largest maker of laboratory equipment and scientific instruments, agreed to acquire Life Technologies Inc. The employees say they didn't get money owed to them, including their final paychecks and vacation time. In May of 2022, it was announced Thermo Fisher Scientific went to court to seek a dismissal of the lawsuit. In addition, OpenGate was to get 10 percent in Maxim plus a $500,000-a-year annual consulting fee, according to testimony. He just settled this one, DeSantis board approves suing Disney in response to lawsuit, Regulators seize First Republic Bank, sell to JPMorgan Chase, What the work-from-home era has done to office politics, First Republic up in air as regulators juggle banks fate. . Catherine A. Osten, Spragues first selectman, the equivalent of mayor, said the company owes more than $240,000 in back taxes. After we signed a contract we thought we were golden, but two months later they told us they were closing the place, Harrelle said. OpenGate nevertheless was lured back in as a short-term lender to Darden. Generating long-term value [26], Prior to raising its first institutional fund, OpenGate also acquired the Waukesha, Wisconsin plant and brand rights to Golden Guernsey Dairy as the result of an antitrust divestment of Dean Foods, which was required to sell the plant to purchase GGD's other plants in the state. it's been delivered there. He said that cost cuts and other moves had pushed PennySaver back toward profitability by May and the company was nearing the end of negotiations to refinance the line of credit or sell the company when Capital One stopped returning the companys calls. OpenGate manages a diverse, global portfolio across key verticals within Industrials and Technology sectors. The firm faced six different lawsuits after abruptly laying off Pennysaver employees in the middle of a work day and failing to give workers their final . OpenGate's professionals possess the . close to . 2:13-cv-03368 District Judge Audrey B. Collins, presiding. Nikou instead tries to generate goodwill as a philanthropist and has even started his own foundation, which boasts of a mission driven by values empowering individuals and communities. Nikou still sits on numerous boards, including that of the Hammer Museum in Los Angeles. Its not a good sign, obviously, Kasoff said of the default. One of those businesses, like PennySaver, filed for bankruptcy. The firm shut down its Fusion Paperboard plant just three years after acquiring it, 18 months after signing a 10-year loan from the state to remain operational, and only a few months after entering into a six-year contract with the local steelworkers union. A bankruptcy trustee subsequently alleged in a court filing that Nikou and OpenGate had obtained the company at a bargain purchase price when the fair value of assets exceeded liabilities by $10.9 million. The state had awarded the company the loan with the understanding that it would stay in Connecticut 10 years. When Brea-based PennySaver abruptly closed last month at the end of a seemingly normal workday, employees of the classified ad magazine were stunned. OpenGate Capital, a Los Angeles firm that amassed $5 billion in revenue during its first decade in business, has run exactly that playbook in Janesville since acquiring Hufcor in 2017. . OpenGate Capital, a Los Angeles firm that amassed. Among them were a French childrens book publisher, a Finnish paper producer, the Nicole Farhi division of fashion firm French Connection and Models One Ltd., the modeling agency that has represented supermodels Bar Refaeli, Alessandra Ambrosio, Linda Evangelista and others. Open Gate Capital aquired my company Pennysaver USA 1 1/2 years ago. While Janesville was once a manufacturing hub, it has experienced the devastating consequences of unfettered corporate greed. Language links are at the top of the page across from the title. [6] He was bullied in school for being short. in Texas, Arkansas, and Wisconsin, who worked for the laboratory furniture company Hamilton Scientific. What the fk is going on? Weinberg wrote in an email to Newkirk on Nov. 12 after learning his cash was gone, according to trial testimony. Barry L. Kasoff, president of Realization Services who served as PennySavers chief restructuring officer, denied the assertion and said the decision to close with little notice was dictated by Capital One. See here for a complete list of exchanges and delays. Last Updated January 23, 2017 at 11:50 PM EST (5.7 years ago) In 2011, OpenGate Capital acquired a Connecticut-based boxboard manufacturer from Cascades Inc. and renamed it Fusion Paperboard. OpenGate Capital, LLC, et al., Central District of California, Case No. This case was filed in Orange County Superior Courts, Civil Complex Center located in Orange, California. OpenGate tried to buy Maxim in early 2013 but was outbid by Darden Media Group. OpenGate is moving the plant to Mexico anyway. Even as hundreds of American workers have suffered from OpenGates schemes, Andrew Nikou, the OpenGate founder and CEO, has not faced any meaningful financial or social consequences for repeated business failures at the hands of his firm. OpenGate is not facing any lawsuits for lack of notification with regard to the mills closure. [5] After graduating, he worked for the Patent and License Exchange, a start-up financed by Softbank Capital.[5]. OpenGate Capital, the private equity firm that owns their employer, Hufcor, announced it was moving its plant out of Janesville, taking those workers' jobs and livelihoods with it. The company is in the process of selling assets to make good on the loan, Fahn said. OpenGate Capital partners with companies to . Headquartered in Los Angeles, California, . A fully integrated team of origination, investment and operations professionals. Opengate did not specify what damages it was seeking. Not meeting those goals or maintaining those levels would result in a default regardless of whether loan payments were made. Kasoff said that his sole focus after his company was brought in was on fixing PennySaver and that a shutdown was never contemplated until Capital One shut off credit without explanation. On Friday May 21,2015 they fired all employees. OpenGate gets sued for alleged WARN Act violations. 1:13-cv-01475 in the Delaware District Court. OpenGate Capital has a history of buying companies, only to close operations shortly thereafter, leaving communities across the country in the lurch. The goal of this section is to provide consumers with a comprehensive resource on class action and mass tort lawsuits. Lauren moved back to the states in 2011 and now lives in Long Beach. They just dont flat out care about being a reputable business, from my perspective, Osten said. of the Connecticut boxboard company Fusion Paperboard, and nearly. When OpenGate bankrupted Pennysaver, a court-appointed trustee sued OpenGate for fraudulently siphoning money from the company through a variety of shady tactics: billing it for non-existent tax payments, loaning money to another OpenGate company at knockdown rates, and putting non-working OpenGate employees on its payroll. The lawsuits allege that a company or individual violated securities laws and are brought on behalf of the class. Around the same time, it was engaged in negotiations to be acquired by another company. OpenGate sued Thermo Fisher for breach of contract, negligent and fraudulent misrepresentation, and other things. OpenGate Capital is a global private equity firm headquartered in Los Angeles, California and Paris, France that focuses on the acquisition and optimization of underperforming businesses in the lower middle market throughout North America and Europe. employees in the middle of a work day and failing to give workers their final paychecks. He was born in Vancouver, attended USCs business school and then took a job at Los Angeles private equity firm Platinum Equity in its Paris office, according to OpenGates website. The lab workstations unit, headquartered in Wisconsin, had facilities in Mexico, Texas and Arkansas. Opengate Capital Group LLC filed a lawsuit on Friday alleging that laboratory equipment maker Thermo Fisher Scientific Inc <TMO.N> sold it a Mexican plant last year without revealing that a drug . Fahn, speaking for OpenGate, said that the union wasnt privy to the sale because the sale wasnt final. But OpenGate never got a dime after it lent the cash as the alleged fraud was uncovered. OpenGate Capital, a Los Angeles firm that amassed $5 billion in revenue during its first decade in business, has run exactly that playbook in Janesville since acquiring Hufcor in 2017. In 2001, Nikou began his career in private equity at Platinum Equity. OpenGate Capital Group LLC et al v. . His father, who majored in mathematics at a German university, worked at the Los Angeles Department of Water and Power. "They basically told us 'We don't want to get to . OpenGate strategically invests in targeted sectors across five continents utilizing a diverse and experienced team with the ability to connect with business owners around the globe. We are proud to have a history of successfully turning around these types of businesses, Fahn added. Click and prioritize people, not private equity profits. This May Day, let's show solidarity https://t.co/4v7zeBzAiz, . But the fact is that weve lost those jobs and nothing has replaced them.. [12] In 2010, Nikou was behind the OpenGate bid for Newsweek, owned by the Washington Post Company, but the firm did not acquire the publication.[13]. Click here. Securities class action lawsuits are filed on behalf of a class of investors or a class of holders of a particular security. On May 27, 2021, 166 workers in Janesville, Wisconsin awoke to a nightmare. June 18, 10:39 a.m.: An earlier version of this article and an accompanying photo caption reported that PennySaver workers were suing OpenGate Capital and its managing partner, Andrew Nikou. Debra Clancy, a senior account manager at PennySaver, joined about 30 other former employees as they yelled towards the 17th floor of a building that houses OpenGate Capital in Century City during a recent protest against the company. A fully integrated team of origination, investment and operations professionals. Likewise, OpenGate itself has continued to raise millions since bankrupting its previous companies, enabling these practices to continue unabated. They have a right to do what they did as far as liquidate the company, but they dont have a right to do it in the manner they did.. [21], In November 2016, OpenGate Capital completed the acquisition of the zinc products business of the Belgian company Umicore for $150 million in debt and equity. This rating has decreased by -11% over the last 12 months. It agreed to provide $3.1 million in financing in November 2013 for five days. They had received no notice that the magazine would be shuttered. In 2010, Dean Foods Company, its then owner, sold Golden Guernsey to a private equity company, Open Gate Capital, LLC ("Open Gate"), as part of the settlement of an antitrust lawsuit brought by the United States Department of Justice. No tags have been applied so far. A court filing by the trustee overseeing the bankruptcy proceedings said Golden Guernsey owed $1.5 million because it had violated state labor laws that require 60 days notice to employees of mass layoffs. Uber drivers and other app-based workers are facing an all-out safety crisis. Shortly after the presentation, senior PennySaver staff members were asked to write to OpenGate partner Jay Yook, outlining how they would turn around the company, said Elaine Buckley, who at the time was PennySavers vice president of outside sales. Terms of the investment were not disclosed. Vice President. Nikou, its founder, is a board member at the Hammer Museum and, until recently, at the Museum of Contemporary Art. Its website says its businesses generate annual revenue of about $3 billion, making it a small player. here to register, Not for publication, email or dissemination, Veritas-backed HMH buys educational services nonprofit NWEA, Professional services company FMP inks $36.5m from Alaris, NMS recaps environmental services firms Texas Pride and Texas Dumpster Companies, MSCP invests in services for homeowners; Patient Square launches platform for medical device makers, Leonard Green to acquire minority stake in HUB; plus Investcorp, Sound Partners, Odyssey invest in HVAC, 700 million people will make their home in African cities over the next decade, said DPIs Marc Stoneham. It maintained operations during the worst of the pandemic and even. EverZinc is headquartered in Lige . It would curb the industrys worst abuses and prioritize people, not private equity profits. While OpenGate was in negotiations to buy the business from Thermo Fisher, armed militants took cover in the Reynosa buildings cafeteria while fleeing their rivals, according to OpenGates lawsuit. OpenGate Capital is a global private equity firm specializing in the acquisition and operation of businesses to create new value through operational improvements, innovation and growth. [5] however, his actions have also drawn substantial criticism, including numerous lawsuits. A link has been emailed to you - check your inbox. OpenGate Capital is a global private equity firm specializing in the acquisition and operation of businesses to create new value through operational improvements, innovation, and growth. In January of this year, Thermo Fisher initiated the eviction of Hamilton Scientific from its Texas facility, alleging that it had failed to pay rent on time three times. So far, six lawsuits have been filed against OpenGate Capital and/or PennySaver in local and federal courts for failing to notify employees of mass layoffs, according to Richard McCune, a lawyer . Financing terms required PennySaver to meet certain financial goals and maintain various debt ratios at certain levels. Chief Operating Officer & Managing Director, Head of Investor Relations & Communications, Operations Expert, Manufacturing & Supply Chain, Senior Advisor, European M&A - Technology, Founder, Executive Chairman, XPRIZE Foundation, Technology Expert, Industrials, Environmental, & Manufacturing 4.0, 2023 OpenGate Capital Management, LLC. 1:13-cv-01475 in the Delaware District Court. Investment Represents Strategy to Create European Aluminium Solutions Group. Those who cashed the bad checks were left on the hook for penalties levied by their banks. When PennySaver closed on May 22, it left 678 employees without a final paycheck or compensation for their accrued vacation days and it meant they had to scramble for health benefits. Thermo Fisher was not immediately available for comment outside of normal U.S. business hours. The employees say they didn't get money owed to them including their paychecks and vacation time. [5], Under Nikou's leadership, OpenGate Capital bought founder-owned businesses and divisions of Fortune 500 companies such as Philips, Schlumberger, Arvin Meritor, Stora Enso and Cascades. You should only be asked to sign in once. Founder & Chief Executive Officer at OpenGate Capital .

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