A dispute between the owners of a downtown music venue has spilled over from the stage to the courthouse.
A group of investors who own a minority stake in the National have sued the controlling members and managers of the venture over allegations about how the business’s funds have been handled.
A lawsuit was filed Oct. 31 in Richmond Circuit Court by James River Entertainment on behalf of RIC Concerts LLC and RIC Cap Ventures LLC, the two entities that own and operate the East Broad Street concert hall. James River Entertainment owns minority stakes of both LLCs.The allegations are made against J. Scott Benton, A. William Reid and a string of LLCs that encompass the majority owners and day-to-day operators of the National.
At least two of the names behind James River Entertainment are Brad Wells and Laurin Willis, local concert promoters who have brought shows to other local venues, including Innsbrook After Hours and Pocahontas Live. Neither Wells, nor Willis are named in the suit.
Among the many claims, the suit alleges that Benton and Reid concealed revenue from ticket sales, excluded members of the owner-LLCs from access to the National and to accurate copies of its books, paid themselves “exorbitant personal compensation,” and excluded James River Entertainment from receiving a distribution.
The case also claims that the defendants allegedly diverted funds from the National to other business interests. Reid and Benton also are part owners of the Norva, a concert venue in Norfolk.
The suit claims counts of breach of fiduciary duty, conversion and fraud and seeks damages of $200,000. It also seeks injunctions and damages including expenses and legal fees.
The plaintiffs are represented by James Cosby, an attorney with Vandeventer Black in Richmond. He would not comment on the case.
Todd Fiorella, an attorney in Norfolk who represents the defendant companies in their affairs, described the case as one brought by “disgruntled minority shareholders.”
“We don’t agree with the content,” Fiorella said. “They made some allegations that we don’t think have any merit.”
Fiorella, who has not yet been formally retained for this case, said there have been disagreements between the two sides in the past.
He said a response to the suit would be filed within the allotted 21 days.