Founder of Harbor Freight Tools sues CEO son
Associated Press
July 21, 2010
The founder of Harbor Freight Tools is suing his son, whom he accuses of kicking him off of the board of directors, having him locked out of headquarters and looting the company to finance a lavish lifestyle that includes a $46 million Beverly Hills mansion.
The lawsuit is the culmination of an increasingly bitter family feud over control of the Camarillo-based imported-tool seller, which has 7,400 employees nationwide.
Allan Smidt, 81, founded the business in 1968 and his son, Eric, is chief executive officer.
The lawsuit, filed by Smidt and his wife last week in Los Angeles County, contends their son persuaded them to turn over control of the company in 1999 but then reneged on promises to let his father have the final say on major business decisions and to pay him $2.5 million a year for his services.
According to the lawsuit, Eric Smidt explained that he hadn't made the past two payments because the company was "going through bad times."
"Eric's looting of the company substantially contributed to any such bad times" and made it hard to keep inventory on the shelves, the lawsuit contends.
Information from: Ventura County Star, http://venturacountystar.com
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2010