Axium International Inc.'s bankruptcy filing sent shock waves through the staffing industry - it owned Ensemble Chimes Global, the largest vendor management system, and provided payroll services to the entertainment industry. A lawsuit filed Jan. 15 against its two owners and their ex-wives sounds a like a Hollywood storyline.
The company paid $462,000 a year to lease luxury cars for owners John Visconti and Ronald Garber, according to the lawsuit by Golden Tree Asset Management. Those vehicles included a Rolls Royce Phantom, a Range Rover, a Maserati Quattroporte, an Aston Martin convertible, and a Bentley Coupe.
Other claims made against Axium's owners in GoldenTree's suit include:
-$500,000 to $1 million of Axium's annual private jet expenses may have been for non-business related trips.
-$40,000 in Valentine's Day purchases at Tiffany & Co. were charged by Visconti to an American Express card issued to Axium.
-"Numerous large payments" were made by Axium to Amber Smith, described as a "model and actress." The company also paid for a corporate apartment in and a car for Smith. According to the suit, "It is unclear exactly what services Smith performed."
-Visconti and Garber received weekly payments of $8,000 - in cash, delivered by armored car - in addition to their salaries.
GoldenTree is suing for interference with contractual relations, fraud, and negligent misrepresentation, among other things. The company said it lent Axium $130 million between 2004 and 2007. Axium also owes millions to the IRS, according to the lawsuit.
The question we have been hearing is, "Where did all the money go?" This lawsuit may help answer that.
Some say the writers' strike helped bring Axium down. But who needs Hollywood writers when you have this kind of stuff?