TRAVERSE CITY — A founder of a northern Michigan food business claims a family of investors in the company faked an FBI interrogation, forced him out and pressured him to sell his remaining share of the operation.
Jeff Hughes, one of the founders of Brownwood Farms, accused investors Carol, Mark and Leland Vittert of shareholder oppression and tortious interference. He filed a complaint against the Vitterts, Brownwood Investors LLC, B-wood Farms LLC and a John Doe in a in 13th Circuit Court on Sept. 2.
Hughes' attorney Jon Bylsma argued the Vitterts tried to force Hughes out of the business by having an imposter pose as an FBI agent from Washington, D.C., to intimidate Hughes with a false FBI investigation and then demand he sell his shares.
"I think they were looking to sell the business, and when Mr. Hughes didn't want to do that they embarked on this scheme," Bylsma said.
Hughes argued in the complaint the family's scheme started in 2012, when Mark Vittert contacted Hughes and said he wanted to become involved in Brownwood Farms. Mark Vittert then purchased shares in the company in 2013.
Hughes is a minority owner in the company, the complaint states. He owns 25 percent of Brownwood Farms while Brownwood Investors, a company of which Carol Vittert is the trustee, owns the remaining 75 percent.
The parties signed an operating agreement that prohibits either from selling the business without the other's approval, Bylsma said.
Mark Vittert suggested to Hughes the company was ready to be sold for a hefty price — between $5 and $6 million — in spring 2016, the complaint states.
Mark and Leland Vittert — a Fox News correspondent — then brought in the man they identified as an FBI agent to interrogate Hughes for three hours on June 21, Bylsma said.
But Bylsma said it's unlikely an FBI agent would get involved in a civil complaint. He said he and Hughes believe the man was an imposter.
"We don't believe he identified himself as an FBI agent would, nor did he engage in the type of behavior an FBI agent would have engaged in," Bylsma said.
The man questioned Hughes about a $75,000 accounting error and payment for expenses including travel, club memberships and entertainment, the complaint states.
Hughes argued other disputed purchases were routine payments for which he had traditionally been reimbursed.
The man purported to be an FBI agent told Hughes he couldn't contact anyone during the questioning, which Hughes described in the complaint as an intimidating and coercive ordeal.
The Vitterts' attorney Scott Howard said the arguments Hughes made in his complaint are untrue. He plans to file an answer before Friday in 13th Circuit Court.
"We vigorously dispute the allegations in the complaint, and we'll respond to those directly through our answer," he said.
Howard said Hughes is no longer with Brownwood Farms because of "serious misconduct." He declined to describe the conduct.
Hughes turned over the keys and left after the June 21 questioning, the complaint states. He said someone purporting to act on behalf of Brownwood Farms sent an email to customers and employees indicating Hughes was no longer with the company.
Hughes said he received a letter asking him to resign and sell his interests in the company for $10,000 a few weeks after the interrogation, according to the complaint.
He requested a jury trial in 13th Circuit Court, an award of damages of at least $25,000 and attorney fees.
"We just want to resolve this in a fair fashion for everybody," Bylsma said. "(The) most important thing is that the people that worked at the company not be affected, his customers and clients not be affected, and so far I don't think this has had any impact."