A co-owner of Springfield’s First Watch restaurants is suing his business partner.
Joseph Hulston, 50% co-owner of Ozark Endeavors LLC, is suing James Tillman, the other co-owner, for fraud, misappropriation of funds and breach of fiduciary duty. James Tillman’s wife, Lisa Tillman, is also a defendant. Ozark Endeavors, LLC manages several LLCs that operate First Watch locations in Springfield, Joplin, Lake of the Ozarks and northwest Arkansas.
The lawsuit, filed April 19 in Greene County Circuit Court, alleges that Tillman increased his own salary, directed salary payments to his wife and daughter, misused company credit cards and moved the LLC’s headquarters to a rented space he owned, all without Hulston’s knowledge. .
Hulston and Tillman are also co-owners of Kansas & Kearney, LLC, which owns a base development site, selling development lots to commercial buyers. In this venture, Hulston and Tillman have stakes of 70% and 30%, respectively. Hulston also alleges that Tillman signed a letter of intent to sell the Kansas & Kearney property without his knowledge and refused to meet debt and expense obligations.
Tillman also operates Huey Magoo’s and Casa Bella locations in Springfield, as well as a long list of LLCs registered with the Missouri Secretary of State. The lawsuit says Tillman has a conflict of interest due to his financial interest in these businesses. In addition to fraud and misuse of funds, the lawsuit alleges that Tillman directed money, contracts, work and business opportunities to entities he owned to the detriment of Ozark Endeavors. Tillman also allegedly instructed employees not to provide business information to Hulston and made derogatory comments about him.
Hulston, Ozark Endeavors LLC and the LLCs it manages are seeking punitive and actual damages in an amount deemed “fair and reasonable” by the court. The lawsuit also states that Tillman should be removed as manager of the plaintiff LLCs and forever barred from making business decisions on their behalf. Hulston also wants Tillman to pay his legal fees.
Lawsuit: Tillman raised his own salary, paid wife and daughter
According to the lawsuit, Hulston and Tillman did not take home consistent salaries or compensation for their first three years in business. In 2020, the pair agreed to set their respective salaries at $60,000, with the remaining compensation in the form of equal distributions. Between 2021 and 2022, Tillman allegedly increased his own salary three times without Hulston’s knowledge: first to $100,000, then to $150,000, and finally to $210,000.
Tillman continues to receive that $210,000 salary despite Hulston’s demand that he reset it to the agreed-upon $60,000, the suit says. Hulston still receives a salary of $60,000 despite having an equal position to Tillman.
Lisa Tillman, James Tillman’s wife, is also named in the lawsuit, which claims to assist Ozark Endeavors’ full-time accountant with matters related to the First Watch restaurant and the Kansas & Kearney property. The full-time accountant’s salary was originally set at $50,000, then increased to $63,000. The lawsuit alleges that Tillman ordered a $65,000 salary to be paid to his wife for helping the accountant full-time without Hulston’s knowledge, permission or agreement.
Lisa Tillman’s salary was increased twice, the suit says: first to $70,000 and then to $75,000 — $12,000 more than the full-time accountant’s salary. The suit notes that Hulston specifically objected to Lisa Tillman being paid more than her accountant or any increase without her permission. Hulston demanded that Tillman suspend his wife’s salary, but Tillman refused.
The lawsuit also names Tillman’s daughter, Jamie Tillman, who previously worked at First Watch on National Avenue. It alleges that Tillman instructed the LLC responsible for the restaurant to pay his daughter a salary and instructed Ozark Ventures to provide health benefits to its employees. According to the lawsuit, Jamie Tillman continued to receive wages and health benefits after leaving her job at First Watch. Ozark Endeavors continues to pay for Jamie Tillman’s health coverage. Tillman allegedly refused Hulston’s demands to stop and refund the payments.
Tillman, his wife Lisa Tillman and his daughter Jamie Tillman did not respond to multiple requests for comment for this article.
More:BBB, Brides Say Marionville Floral Preservation Company Took Money and Didn’t Return Flowers
Allegations of fraud, misrepresentation and misuse of corporate credit cards
According to the lawsuit, Ozark Endeavors entered into a lease for rentable space for its headquarters at 610 E. Battlefield Road in 2019, with monthly rent payments of $1,710. In September 2022, without notifying Hulston, Tillman allegedly moved headquarters to rented space at 1840 S. Ingram Mill Rd. owned by J&M Tillman LLC, a company controlled by Tillman. After the move, the monthly rental cost increased to $9,750.
The lawsuit claims the original leased space was more than adequate and there was no business reason for Ozark Ventures to move to Ingram Mill Road. Tillman allegedly refused to provide lease documents related to both spaces and an explanation for why the rent increased by more than $7,000 per month.
The lawsuit says six people at Ozark Endeavors were issued company credit cards for convenient payment of business expenses, including Hulston, Tillman and Lisa Tillman. Hulston alleges that Tillman and Lisa Tillman used the credit cards for personal use and to support their own businesses. Charges include Amazon Prime movie purchases, clothing, domestic and international travel, TV subscriptions, construction expenses, fuel expenses, car repairs, groceries and home improvement costs. According to the lawsuit, Tillman refused Hulston’s demands for credit card statements and business justifications for the suspicious charges incurred.
Unlike First Watch and Ozark Endeavors restaurants, Hulston owns 70% of Kansas & Kearney, while Tillman owns 30%. Tillman allegedly represented himself as the sole owner of the business to a real estate agent and told the agent to cease any contact with Hulston. Then, the suit says, Tillman signed an $825,000 letter of intent to sell the Kansas & Kearney property.
The plaintiffs, who are Hulston; Ozark Endeavors, LLC; Avenida Nacional FW, LLC; Eastern Sunshine FW, LLC; Lake of the Ozarks FW, LLC; Joplin FW, LLC; Rogers FW, LLC, Bentonville FW, LLC; North Fayetteville FW, LLC; and Kansas & Kearney, LLC, are represented by attorney Bryan Wade.
