Days after news emerged that Nashville's Amplifier Advertising LLC was closing down, one of its major clients has filed suit against the company and principals Tim Best and Gunnar Eng.
American Honda Motor Co. claims the defendants misappropriated some $1.5 million in funds that were supposed to go toward ad purchases.
Honda filed its complaint on Thursday in Nashville's U.S. District Court. The vehicle and machinery manufacturer, based in Torrance, Calif., says it sent the money to Amplifier starting last July so the agency could purchase print media space and broadcast media air time to advertise Honda products. Instead, the company alleges, Best and Eng "intentionally and fraudulently diverted" the $1.48 million provided for ad buys while wrongfully collecting a further $40,000 in agency fees.
Honda claims that "the agency, Eng, and Best used the funds to pay salaries of agency employees, to pay other debts owed by the agency, and generally to fund the agency's business operations." They are also said to have "paid some of the funds to a former owner of the agency, who was owed money in return for a buyout of his interest in the agency by the agency and/or Eng and Best."
As NashvillePost.com reported on November 5, Amplifier ceased operations just a few months after changing its name from Frank/Best International and parting ways with founding partner Bobby Frank. Frank has created a new company, BorderJump, which helps American companies reach Caribbean and Latin American consumers. He is not named in the lawsuit, filed on behalf of Honda by Edward Owens of Lewis, King, Krieg & Waldrop in Knoxville.
The ad agency originated in 1997 as McGee Best Frank & Wiseman. Former Carden & Cherry president Pat McGee co-founded the firm with Best and Frank as well as K. K. Wiseman. Soon after creating the company, the principals brought in David Ingram, head of La Vergne-based Ingram Entertainment Inc., as an investor, changing the name to McGee Best Frank & Ingram.
Eng, formerly with the Nashville agency Endres Eng & Wilson, was an original employee with the McGee Best firm. Attempts to reach him Friday were unsuccessful.
In late 1998, Best, Frank and Ingram voted to terminate McGee as president. Years of litigation ensued over the firing, much of it summarized in a 2002 ruling from the Tennessee Court of Appeals. Best, Frank and Ingram ultimately prevailed. The firm dropped Ingram's name in 2002.
"I can't say I'm surprised," McGee commented when told of the new lawsuit on Friday."My experience with Tim Best was unfortunate. I found him to be a disloyal partner and someone who relished operating with subterfuge as part of his agenda."
Reached at his home, Best declined to comment on the lawsuit. When informed of McGee's comments, Best responded:
"Mr. McGee was terminated by a unanimous decision of the partners of our firm many years ago. Consequently, he filed a lawsuit against our company, and the court upheld our decision. We haven't communicated in years, and he knows nothing about the circumstances surrounding our painful decision to close.
"It is unfortunate that he still bears resentment."
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