More Bad Legal News For Lisa Vanderpump and Ken Todd

Lisa I don't want to hear it

Gif: Realtytvgifs

The hits keep coming for Lisa Vanderpump and Ken Todd. I’m almost starting to buy Lisa’s “puzzlement” over the recent verdict in the Bustillos case. She seems to be focused on the sexual assault claim and unaware that she has been found liable for wrongful termination, hostile work environment, and I believe gender discrimination.  It seems that Ken and Lisa have very limited understanding of the law. I’m not just talking about court room procedure, I’m also talking about all the LLCs they have. It seems they simply hire lawyers to handle such matters and hope for the best. This plan relies heavily on hiring great lawyers, and I’m not so sure they have.

Where to start? I suppose with a brief explanation of the Alter Ego Doctrine. First of all, rich folks like Lisa and Ken tend to create corporations in order to separate liability between their personal and their business finances. This is done primarily to protect personal assets when a business is sued in civil court.  In California, even limited liability corporations (LLCs) can be challenged by the alter ego doctrine. Basically, what this means is that the plaintiff can say that the corporation is only a corporation for the purpose of protecting assets and has no other function. In other words, in this case, the corporation is just Ken and Lisa using another name (an alter ego.)  If they are found to be acting as an alter ego, then Ken and Lisa can be held personally liable for damages.  Are you with me so far?

Most of the time, the alter ego doctrine does not apply. The whole point of incorporation is to insulate against liability and the large majority of the time, that intended result holds up in court. There are some legal things that have to be done, basic corporate formalities must be followed, finance records must be kept, there must be a manager to oversee the corporate affairs, monies cannot be commingled with the personal finances of the members of the corporation. You need a good lawyer and a good accountant.

Gif Credit : T.Kyle Reality TVGIFS

Gif Credit : T.Kyle Reality TVGIFS

In order for the alter ego doctrine to apply, the plaintiff  has to show essentially that (1) Blanca investments is basically just  a corporation in name only and that it’s just another piggy bank for Ken and Lisa (legal term: a Unity of Interest) and (2) that an inequitable result would occur if the corporation alone is held liable.  If the court feels that by recognizing the corporation, the ruling would sanction a fraud or result in an unjust settlement then the alter ego doctrine would apply and Ken and Lisa would not be individually and personally liable.  Still there? I’m getting to the good part, I promise.

In the Bustillos case, the plaintiff’s lawyers asked the court to apply the alter ego doctrine and hold Ken and Lisa personally accountable for the damages the jury award.  At that time, on June 13th, the judge ruled that the alter ego doctrine did not apply. Which was good news for Lisa and Ken, this means that only the monies in the corporation could be applied to the damages. YAY TEAM VANDERPUMP! VICTORY!

REAL ALL POSTS ON BUSTILLOS CASE HERE!

But wait. When the plaintiff filed their motion requesting Ken and Lisa to be responsible for all attorneys fees, the judge re-evaluated his decision. And on June 18th, the court, of it’s own volition, reversed his decision on alter ego and found Ken and Lisa personally liable for the damages caused by the actions of Villa Blanca employees (which included Ken specifically).

The judge found that there was  unity of interest based on the following:

  1. Neither Ken or Lisa indicated any understanding of the corporation documents
  2. Ken did not know whether he or Lisa was the manager of Blanca Investments, LLC.
  3. The corporate operating agreement didn’t clearly state who the manager was.
  4. Ken testified that he and Lisa were the sole members of the corporation, but they are not, one of Lisa’s LLCs LJV Investments is also a member of the corporation. (Meaning Ken doesn’t even know who the members are.)
  5. It was not clear to the court whether the signatures on the documents filed with the Secretary of State were actual signatures of the members. (Meaning the LLC might not even be valid???? is that what this means?)
  6. Lisa did not make any capital investment in Blanca Investments, LLC.
  7. Lisa testified that there were no board meeting for Blanca Investments, LLC and that if she needed to discuss corporate business with Ken she would do it “over breakfast, over dinner, or in bed.”

As for the inequitable result findings, in court the defense provided testimony that Blanca Investments LLC is not financially healthy and the net income of Villa Blanca last year was $200,000. Because the case has gone on for 21 months and went to jury trial, the attorney fees will be in the very high six figure range. Therefore, Blanca Investments, LLC does not have the money to pay for all the damages including compensative, punitive, attorney fees and court costs which could approach a million dollars.

Because of this ruling, Blanca Investments LLC will not be held liable. This means that Lisa and Todd are personally responsible for all damages.

That is pretty major. Now Lisa and Todd will most likely have to put up some sort of fight and this will drag on and on as the lawyers continue to get rich.

Will Lisa’s Bravo checks be claimed by the courts to pay off this judgment? Will any of this have an effect on their Investment Visa immigration status? Will Ken and Lisa end up couch surfing at Brandi Glanville’s place?  Stay tuned. This ain’t over yet.

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61 Comments

Filed under Ken Todd, Lisa Vanderpump, News, Real Housewives of Beverly Hills, RHOBH

61 responses to “More Bad Legal News For Lisa Vanderpump and Ken Todd

  1. Riley

    Boy! That’s a lot to take in. Hope Ken and Lisa are understanding it all. Rich is nice but complicated. Like you Tamara, my house is paid for and I don’t live like I have more than I do. So my life is simple and uncomplicated and I’ll take that any day over rich.

  2. Shirley

    Damn that’s was a lot of information TT!! I think I feel bad for her now! Talk about complications!!

  3. Dana

    Looks like the “out of work actress” who “cant keep a waitressing job” took you to the cleaners. There’s your checkmate bitch.

    • “checkmate bitch”!!!

      Nicely done!

    • Gingersnap

      I almost want to have “Team Bustillos” t-shirts made up ;)

      • Bella

        Wow really? Lisa worked hard to build her business/money and you applaud this girl with a weak backbone for taking it from her? I guess when you are wealthy you can do no good in the public’s eye. Even if you work hard to succeed there is always some greedy poor person just waiting to take it all away from you over some over exaggerated issue and the public will rejoice. Bustillos beware, easy come easy go. Things you do come back to you. Greedy slime.

      • If you are going to be a businessperson, wealthy or otherwise, you have to follow the law. The “greedy poor person” stood up for her rights not to be harassed in the workplace, that’s the opposite of a weak back bone.

        Working hard to succeed doesn’t mean getting rich of the backs of the “greedy poor people” making $9 and hour busting their asses in the kitchen every day. It’s possible to be a “wealthy businessperson” and treat your employees well, or at the very least within the laws that protect their health and safety.

        You sound like an elitist jerk. Fortunately, this country is not ruled by your opinion, but by laws. The jury found the laws were violated. The judge agreed with the jury to the extent that he actually expanded the liability for Lisa and Ken.

        Your take on the situation, “blame the victim” is outrageous and cruel. ​

        On Sun, Jun 22, 2014 at 1:23 AM, Tamara Tattles wrote:

        >

      • Dana

        I’d wear it! 😄

      • Gingersnap

        Bella, not only do I applaud Bustillos, I’d give her a standing ovation if I could. Initially she wanted $300.00 bucks and not to have to work with the guy that was sexually harassing her, but this cost was too exorbitant for Ken Todd and his arrogance and he said NO! Then he decided to get rid of the taped evidence proving Bustillos was telling the truth. Ken and Lisa brought every bit of this on themselves, all they had to do was acknowledge there was an issue, pay $300.00 bucks, and rearrange her schedule. Easy peasy. As employers they have a legal responsibility to their employees, whether they like it or not, and they don’t get to pick and choose. They are not above the law. I can agree with you that the things you do come back to you, and maybe this will be a shining example to Ken and Lisa that this universal truth applies to them also.

      • THANK YOU TAMARA! Apparently Bella is not old enough to remember or know of pre 1980 when women were slapped on the behind or worse and had to take it or they could be fired. I started mid 80s, wore the little bow tie and my suit skirt fell just below my knee, and still had bank trust officers try to trap me in the file room to give me a long hug. Complaining to the ombudsman was certain to get you fired. When I quit and joined the family accounting practice a male client pinned me against the wall. My father didn’t defend me. He just told me if I wanted to work in business, I had better learn how to play the game.
        Now, we have harassment laws, but at least in my state it’s a 5 to 6 year wait to get through the court system and honest attorneys usually advise you to take whatever the employer offers because the wait and legal fees are enough to bankrupt you.
        Thirty years later and I still have nightmares about the client sticking his tongue down my throat. His former bookkeepers and I have formed our own little support group. Bella needs to appreciate the brave women and men who spoke up even though they were ridiculed to get the laws and remedies that we have today.
        Sorry this is so long. It’s a topic that makes my blood boil.

      • Valerie

        Anyone that has worked in a hostile work environment knows that it sucks up your soul. I work in a family business with my brother and we believe in giving our employees a living wage, benefits and we have two rules; 1. Be nice and 2. Do your work. Our employees are not expendable and they end up saving us money because they stay with us. We have very little turnover.

        Sometimes I have to fight for my people because, well, you know…Greed, but I refuse to let this office become a hostile work environment. Since this is so dear to my heart, I simply have lost respect for the Vanderpump/Todds. I don’t believe this is a one time occurance either.

      • Bella

        TT, thanks for calling me an elitist jerk :) Anyways, I wasn’t trying to be cruel. But when you are on the other side of the fence you see things differently. When you are rich there are always vouchers out to destroy you. Because that is my experience it does not make me a jerk. And I don’t think Lisa knew how to handle the US business laws. “Hopefully it’s a lesson learned for her. I don’t think she was intentionally mean. But of course I am in the minority because I disagree with Bustillos and I’m fine with that. I guess I should pity her because she is a waitress and struggling actress. Mkay whatever. We all make choices in life. Some people are just bitter and jealous and weak. IMO. Sorry to offend.

      • ​It sounds terrible for you poor rich people. No wonder you can’t be bothered to follow the law regarding the welfare and safety of your employees. The strain of all the peasants who are out there trying to grab your coins must be so difficult.

        On Mon, Jun 23, 2014 at 1:24 AM, Tamara Tattles wrote:

        >

      • Bella

        @ S Ross I wasn’t born prior to 1980 I was born much later than that so you are right, I don’t know what you are talking about.

      • Bella

        TT, we are good to our employees and pay them well. We are not all the same. It’s cool, people will hate you when you are successful and try to ridicule you. We are the bad people. All poor people are innocent victims who have no options in life :( . How dare rich people work hard to have a good life for their families and donate millions of dollars to charity and people in need. After all rich people are the devil. I know how it is. Didn’t think you were like that though.

      • If by “like that” you mean that I think you sound ridiculous, then yes, I am “like that” I know many wealthy people and I have never heard them bemoaning the throngs of peasants that are trying to rob them blind. Just you. You’re the first.

      • Gingersnap

        Just for the record, greed isn’t confined to any particular socioeconomic group. There are greedy poor, middle class, and rich people. It’s really all about the individual.

  4. Vanessa

    So your definitely a good one TT for summarizing all of this because this seems like a lot to go through, I have to admit its a little over my head : )

  5. Vanessa W

    I wonder if it’s only VB that’s this complicated I mean they have had 26 restaurants in London plus sur and pump, is it not the same for all of them or is it just that Pandora’s box has been opened for VB

    • Not sure what you mean by complicated. I would assume if the corporation for the first restaurant, Villa Blanca, is this loosey goosey, that SUR and PUMP are probably the same. I have a feeling they will hire a new attorney that specializes in corporations to​ dot all their I(s) and cross all their Ts . But I may be over estimating their intellect. Lisa just wants to keep saying how puzzled she is over and over.

      On Sat, Jun 21, 2014 at 3:36 PM, Tamara Tattles wrote:

      >

  6. Valerie

    HOLY SHIT! What the hell. Now I am wondering if this is the lawyers fault or maybe Ken and Lisa couldn’t be bothered to actually educate themselves on their own LLCs? That’s so stupid! How does Ken not know who the manager is, I don’t believe him, he’s got to be lying (allegedly). As a business man he can’t be that stupid. When you get down to why an LLC is formed it’s to protect the HONEST business owner. If you are found to be breaking the law, you can no longer expect protection under that LLC. I think they should be held personally responsible because clearly the allegations are not something the LLC was ever meant to protect. They are hiding behind their LLC, but again an LLC is not suppose to protect you if you’re breaking the law. I also believe that they can (again allegedly) afford to keep this going for a long time. And I guarantee that the Vanderpump/Todd attorneys are smiling all the way to the bank. ALLEGEDLY!

  7. MicroOp

    Damn. They definitely aren’t big leagues. Seems like they don’t really know what they are doing.

  8. My how the mighty are falling.

  9. Interesting, sounds like “piercing the corporate veil” – if the officers of the corporation don’t treat the business like a corporation, then neither does the court.

    Sounds like Ken and Lisa are messy while running their businesses, but then when there’s a problem, want the professional protection given to corporations. Glad they were called on it.

  10. Mango

    Thanks for much TT for explaining all the details, it’d be pretty confusing otherwise.

    Ken and Lisa are basically momentum players, they set a place up, get the buzz going, flip it and then on to the next project. that may be why they have a pretty lax attitude about a lot of things. I’m surprised how poorly prepared they were by their attorneys, usually clients are put through their paces several times before being deposed. Then again, their schedule is so hectic they may have blown that kind of prep off figuring the case would just go away. And if they’d settled with Bustillos for $40,000, it might have. (I’m having a hard time feeling sorry for them.)

    • Valerie

      I think Ken was prepped. I do not think he’s telling the truth. It’s pretend. You think he doesn’t know who the managers are on all his LLCs? Ridiculous. They’re both playing dumb. The Plaintiff isn’t going to see any money any time soon. They’ll drag it out. Allegedly.

      • Mango

        I don’t think they’re playing dumb here, I think they really don’t know fuckall about who is supposed to be doing what in their llcs. If they’d taken the case more seriously they’d have prepped on that kind of stuff. It’s an almost willful refusal to act in their best interest. Maybe they’re just accustomed to getting their way, who knows.

        For instance, the gm testified the tape was destroyed because Ken was afraid of it making them look bad. Again goes to not knowing what is in your best interest. If someone is assaulted in your workplace and the tape bares the claim out, then it is clearly in your best interest to do everything in your power to address the claim, fire the harasser, whatever. Do whatever it takes to lessen your liability. Instead, Ken had the evidence destroyed, playing the odds the case would never get far without the tape, and lost.

      • Valerie

        Mango, if that’s true, than they’re just successful out of sheer luck, and when you are as successful as them, but your left arm doesn’t know what your right arm is doing, you simply don’t become a multi millionaire unless you inherit IMO. They know the truth and they are acting completely amoral. Who knows how many times Ken has erased something because it might hurt their reputation. I doubt this is their first rodeo, they are not to be trusted is what this taught me. Allegedly.

      • Cythere

        I can’t stand either of them: They are slippery and False. It’s all an act.

        One example is how they both reacted when last season in Puerto Rico they were questioned. They dramatized it to the point of looking ridiculous IMO. Cowards and bullies. They showed they weren’t real friends to any of their castmates. (I do think though that Ken cares about Mauricio. Maybe *that’s* what Lisa has against Mauricio.)
        Lisa in various situations acted like she has no conscience or empathy, and Ken explodes into anger, and mindlessly backs her up on everything no matter what. (Avoidance tactic.)
        At the last reunion, Lisa engaged in so much doubletalk and misdirection, I found myself detesting her, and wondering why I ever liked her.

        I am so glad the chickens are finally coming home. Hurrah.

        I read another poster here (Dracla) said she (or he?) (paraphrasing here) began to see beneath the Lisa facade during Vanderpump Rules. Likewise!For instance, more than once Lisa talked about Jax’s (and I quote): “dick.” He was her employee. That’s just ugly. Vanderpump must think she’s made of teflon. In the real world, I think that kind of behavior is sexual harrassment. And she didn’t stop there.

        Anyway…

        I have a question for the folks here: Does anyone remember Lisa’s putting tabloids in Brandi’s suitcase before they went to Palm Springs?
        I thought for sure Bravo showed that — though it’s gone now.

        I love this site, and Tamara is the bomb!

    • Gingersnap

      Mango, I think Bustillos didn’t settle with THEM for the 40 grand. From my understanding, how it went down was Lisa (or Ken or VB or their alter ego or somefuckingbody) offered her the 40G’s to settle and she said she would accept with provisions. Those provisions included that Lisa (or Ken or VB or their alter ego or somefuckingbody) would quit serving catfish calling it the more expensive tilapia, quit calling canned foods as fresh, and order the employees to frequently wash their hands. Haha, talk about checkmate, bitch! Needless to say, they couldn’t very well meet her provisions without admitting guilt to her provisions. Personally, I’m loving this girl, she has spunk and isn’t laying down and playing dead like, I suspect, she was expected to. Good for her.

      • Mango

        Thank you for reminding me of all that, Gingersnap, I’d forgotten — once again, drinking and commenting don’t mix lol. I’d kind of looked for this story to get more play in the media, and TT’s done a great job sorting out the facts in the case, but so far…not much. Besides here, a wee bit at RT. I don’t think this case will tarnish their image much, just a little pain in the wallet.

      • Billie

        “or somefuckingbody”” 8~)

      • Marilyn

        I agree – this girl hung in there and fought. It’s really sad to read other women disparish this young woman. I mean are people that blinded by Lisa that they will condone sexual harrassment in the workplace.

  11. These are two rich people in America. Nothing will happen.

  12. The Disher

    Interesting and great reporting! Perhaps they are naive as to the US’s legal system. I remember looking at some real estate tax records online that showed Ken and Lisa’s former mansion, Adrienne Maloof’s and everybody else on the same street. Every single person on that street had their home in a trust or corporate name — except Ken and Lisa. They had their home in their own names. Rich folks usually do a better job of making themselves judgement proof.

  13. Lck

    Wow.. As an HR consultant, I’ve noticed when I’ve had British companies interviewing Americans for businesses they are opening here..the English had no understanding of our laws, and would ask completely outrageous (and unlawful) questions, such as how old are you, and do you plan on getting pregnant, etc. I’ve had to sit them done and school them after a couple of complaints. They are not bad people..they are just not familiar with our laws, and had no idea..
    I’m wondering if that’s the case with Lisa and Ken. They’ve had clubs and restaurants in the UK for years, then came here. Maybe they just don’t know the differences. What they need to do ASAP is hire an HR person for each business (a pro) to handle these problems and nip them in the bud as they pop up, as they always do. They need new lawyers too!
    This case should have been settled when it happened!

    • Vanessa W

      That’s interesting, that’s actually what I’m honestly starting to think, it has to be different in the UK then in US especially if they could have that many bars in London, but you would think the lawyer would go over the us rules with a fine tooth comb to inform them. I do think that they will hire a new lawyer to make sure this doesn’t happen again. I guess on the bright side the bravo checks will help pay for however much will come out of their personal account

      • Lck

        They need a better lawyer, but they really need an HR dept. these are rookie mistakes that HR would have handled correctly in the first place. A manager isn’t a specialist so that’s where these issues are getting screwed up. Lisa and Ken have several businesses and two shows.. They are spread too thin to oversee the details.

    • terry macon

      thank you,thank you LCK, I was just thinking the lawyers have made a mountain out of a mole hill. HR is truely the answer here.

      • Lck

        Yes! This shouldn’t have been a legal issue at all. Just fair practice in-house would have settled it when it happened. :)

    • Marilyn

      Yes – I’ve said that they need to invest in an HR manager ASAP. I stated on here that maybe labor laws in England are different and another poster here commented that the laws are about the same.

  14. Its gotta be a pain to be a employer, these two have had more lawsuits…..I guess it does pay have money, because they keep lawyers happy

  15. Katrina

    I thought in one of the RHOBH they stated they did not own 100% of those restaurants? The whole point of being in a LLC is to protect personal assets. Interesting case!

  16. well, it’s about effing time. thought the judge had a screw loose before. did think ken & lisa would have had their shit together better re protecting their own assets/asses.
    this is really big, tamara. thank you for breaking it down for us!

  17. I think Ken needs to retire.

    • Lck

      Lol! That’s possible too!

    • Marilyn

      I thought Ken was retired because all he seem to do is follow behind Lisa carrying that dog. But Ken is involved in a lot of lawsuits because of his behavior. Lisa needs to put a muzzle on him.

      • they have to play a management role in their businesses to keep their EB-5 status.​

        On Mon, Jun 23, 2014 at 12:23 AM, Tamara Tattles wrote:

        >

      • Vanessa W

        Thats exactly what im saying, its like he needs a constant babysitter. it seems Ken certainly doesnt have any type of concern/care for anyone outside of his family or at least for anyone that works for him

  18. DennyLuvsDashies

    If they are this sloppy with their LLC then they probably comingle the money too. Either way its chump change for them. Too bad they wont learn a lesson from it. IMO

    • Vanessa W

      True It may be chump change, but that doesn’t mean they want to lose a single penny of it lol, so now that their personal money is being hit I think they will definitely learn their lesson

  19. Dracla Dunning

    Dumb like a fox? Nah. Just plain dumb. Money can buy a lot of things including poor legal representation. In the case of Vanderpump/Todd, the chickens have come home to roost. They are so arrogant that they are going to contine this into act 2 so I am going to get some popcorn , sit back and laugh my ass off while the courts of my good old red, white and blue school them in the Economics of Business 101. Go Bustillos. Stay strong and keep your American girl head high. Soon enough you will be able to step into a brighter future without these town clowns pulling you down to their level of disgust. And if you haven’t watched VR, do. You will see what I mean about disqust in the workplace.

  20. Josie

    I’m not ready to wear a Bustillos t-shirt just yet because I really have no idea about her character. However, she was in the right and I’m very glad justice prevailed. I don’t see why the manager would lie about Ken destroying the tape.

    It is a shame that the manager who was harrassing her got away with it. Let’s not forget about Govia. If Lisa and Ken want to be mad at someone, how about starting with him.

    I wonder how much time they have to come up with the cash to pay the judgement?

  21. We went from a Incorporation to a Limited Liability Corporation about 10 years ago.
    Our personal finances were to mixed together and with the LLC they are separate. The other reason was to protect our personal property from on the job lawsuits.
    We had pot smokers sign all the forms about not smoking on the job site but we honestly did not trust a few of them to not smoke.
    That’s why we went LLC, protection!

  22. frenchpoodlename

    Lisa still has wriggle room. She hasn’t said whether she’s lost faith in the court system or Govia et al. I think the restaurants are her playpens; her satellite court, with liveried courtiers jumping around to her command.

    However, I totally support her humanitarian and animal rights efforts.

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