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Menard accused of witness tampering

January 19, 2015

The gritty legal battle between hardware store titan John Menard Jr. and Indianapolis power couple Steve and Tomisue Hilbert now includes this accusation: trying to buy off a witness.

According to new court documents, attorneys for Menard offered to pay a $200,000 legal settlement to a former executive at a Menard-controlled company if he provided helpful testimony in their cases against the Hilberts and their friend Lisa Trudeau.

That offer, made to Scott Matthews, the former executive vice president of Indianapolis-based tanning products company New Sunshine LLC, is a case of “witness tampering and obstruction of justice,” according to attorneys for Tomisue Hilbert and Lisa Trudeau. They say it should disqualify Menard’s attorneys, if not scuttle their lawsuits entirely.

“The conduct of Mr. Menard and his team of lawyers is deserving of the most serious sanctions that this Court can impose including the dismissal of all complaints and counterclaims filed by Mr. Menard and the entities he controls against Mrs. Trudeau and Mrs. Hilbert,” wrote Indianapolis attorney Linda Pence, who is representing both women in the litigation in Hamilton Superior Court.

But an attorney for Menard called the new allegations “completely false and ridiculous” and promised to fight back.

“It is unfortunate that, once again, Linda Pence has chosen to manipulate the facts to impugn my character and the character of my clients, all in an attempt to distract from the lack of merit in her case,” Michael Wukmer, an attorney at Indianapolis-based Ice Miller LLP who is representing Menard and his wife in the litigation, wrote in a prepared statement.

Messages sent to representatives of Wisconsin-based Menard Inc., the hardware store John Menard leads, were not returned by IBJ’s deadline.

Epic legal brawl

Matthews and Trudeau worked for New Sunshine and its subsidiary, Australian Gold LLC, when the companies were controlled by the Hilberts. The companies were two of several purchased by MH Private Equity, an investment firm funded by Menard and managed by the Hilberts.

But the Hilberts lost control of the companies in early 2013 when Menard won a court order removing them as managers of the private equity firm. Menard said the value of the companies had plunged 70 percent due to the Hilberts’ mismanagement and self-serving decisions.

hilbert-factbox.gifShortly after the court order, Menard and his representatives fired Matthews, Trudeau and at least two others at New Sunshine.

Since then, Menard and the Hilberts have waged a massive court battle that involves a dozen lawsuits in courts in both Indiana and Wisconsin.

One of those lawsuits was filed by Australian Gold, now in Menard’s control, against Trudeau, claiming she owes $1.5 million in wages for work she failed to perform and for reimbursed expenses that were improper.

Matthews filed his own suit against New Sunshine, claiming the company owed him more than $500,000, in accordance with his employment agreement, because it dismissed him without cause.

Matthews’ attorney declined to comment for this story.

As of the summer of 2014, Matthews had yet to find a permanent job, according to an affidavit from Matthews, which was filed as part of Trudeau’s and Hilbert’s latest accusations.

So Matthews turned for help to Wukmer, with whom Matthews had previously worked during an eight-year stint at Ice Miller.

Emails disclosed in the lawsuit suggest Wukmer tried to get Menard’s corporate counsel to agree to a settlement payout for Matthews in exchange for testimony Menard’s attorneys could use against Trudeau or the Hilberts.

Hired as a favor?

Attorneys for Menard have been trying to argue that Trudeau, the wife of former Indianapolis Colts quarterback Jack Trudeau, was employed at Australian Gold as a favor to her from the Hilberts—at Menard’s expense. They claim she did little to justify her $65,000 salary at Australian Gold, and that she was reimbursed for non-work expenses, such as coffee at Starbucks, liquor and a $60 visit to a chiropractor.

Proving those allegations would help the Menard attorneys demonstrate their larger arguments against the Hilberts—that they were mismanaging the MH Private Equity companies and using Menard’s money to benefit themselves and their friends.

One line of the affidavit Menard’s attorneys wanted Matthews to sign reads, “I am fairly confident that Lisa Trudeau was given great liberties to do as she pleased because she was friends with Tomisue Hilbert.”

Matthews denied that was true, and Pence has filed hundreds of pages of documents from Australian Gold showing that Trudeau headed up photo shoots for Australian Gold’s skin-care products and helped dream up names, packaging and other materials to market them.

But Wukmer tried again. In emails with Matthews’ lawyer John Morse, he suggested Matthews could help the Menard side by broadening his testimony to include things that might not support Trudeau’s case.

“If Scott were not taking her side, what factual statements could he make that would challenge her version of the truth,” Wukmer wrote in an Oct. 22 email to Morse. He added, “While Scott can testify that he believed Lisa was working outside the office, I doubt that he had personal knowledge of what she did outside the office or how much she actually worked. Is he just making assumptions? … Were her expenses all used for customer entertainment or is Scott only assuming that to be true?”

In another email, Wukmer said the proposed affidavit was designed for Matthews to change to make it accurate.

“Obviously, we want the affidavit to be truthful, so we request that Scott modify it as necessary to correct any misstatements,” Wukmer wrote to Morse when he first proposed the affidavit about Trudeau on Sept. 30.

He said, she said

But Matthews recoiled at the idea of changing his assessment of Trudeau’s work for Australian Gold, which he had given verbally to Menard’s attorneys on two previous occasions.

Finally, Wukmer called an in-person meeting on Dec. 4 at Ice Miller’s offices, according to Matthews. Wukmer read another version of the proposed affidavit he wanted Matthews to sign, but it still contained most of the same statements about Trudeau that Matthews had already said were false.

Then Wukmer asked Matthews if he could testify that Steve Hilbert had paid him $7,000 in exchange for providing false testimony in a November 2013 federal court trial between New Sunshine and one of its former business partners, New York-based Melania Marks Skincare LLC. Melania Marks won that court dispute.

“This statement is absolutely false and I vehemently denied the veracity of such allegations to Mr. Wukmer,” Matthews stated in the affidavit he did sign, which was filed by Pence in Hamilton County.

Matthews also continued to ask for $500,000 in settlement payments from New Sunshine, but Menard’s attorneys never indicated they would pay more than $204,000.

In spite of those misgivings, Matthews tried to strike a deal with the Menard attorneys. On Dec. 15, Matthews’ attorney Morse sent a revised version of the affidavit to Wukmer, but also gave the Menard attorneys an ultimatum.

“As you know, Linda Pence continues to press us to meet with her, and we plan to do so if no deal is reached this week,” Morse wrote.

No deal was reached, and on Jan. 5, Matthews signed an affidavit for Pence, which she filed the next day in Hamilton County Court.•
 

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