Chip Gaines Accused of Fraud by Former Business Partners
"Fixer Upper" star Chip Gaines is facing a million-dollar lawsuit for fraud filed by his former real estate partners John L. Lewis and Richard L. Clark.
The two, who are former co-owners of Magnolia Realty with Gaines, claim that the HGTV star bought them out of the company a couple of days before the network picked up "Fixer Upper."
They said that the series, which Gaines co-hosts with his wife Joanna, "prominently featured the Magnolia brand name" and that he deliberately kept the information about the show being picked up by HGTV a secret from them.
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In the lawsuit, Lewis and Clark explained how Gaines talked them into selling their one-third ownership stakes in Magnolia for $2,500 each without letting them in on the possibility of the value shooting up due to "Fixer Upper" and its heavy association with the company.
Lewis and Clark are now asking for more than $1 million in damages or whatever the amount their stakes with Magnolia Realty would have been including in-kind benefits and distributions if they knew about the milestone. They also want their ownership stakes back.
"At a time when only the Defendants knew that Fixer Upper had been fast-tracked for a one-hour premiere on HGTV and was on the verge of radically changing their lives and business enterprises, Chip Gaines conspired to eliminate his business partners — notwithstanding their longstanding friendship — in order to ensure that he alone would profit from Magnolia Realty's association with Fixer Upper," the lawsuit reads, as per USA Today.
The lawsuit went on to detail how the three of them came together and how Gaines reportedly threatened Clark through text when he was unwilling to sell.
Meanwhile, Gaines' lawyer Jordan Mayfield told Fox News of their confidence that these claims will be found "meritless," describing it as an attempt to "take advantage of the hard work" of Gaines and his wife.
