humboldt creamery scandal

Watson said his client was never a “financial advisor.” Hamer, however, throughout the deposition of Titus alleges that the CFO knew the financial picture of the creamery wasn’t bright, despite Ghilarducci-issued press releases. Ghilarducci, meanwhile, has no insurance coverage, since the the Philadelphia Insurance policy dropped him because of his guilty plea — considered uninsurable “intentional conduct.”. Organic powders are popular with food processors and confectioners. They want high quality dairy products that are organic, clean and delicious. He did admit, states Hamer, that he knew the creamery was not bringing in enough revenue to cover its short-term or long-term expenses and that the creamery was only able to continue operating by not paying a major debt owed to its co-partner, Dairy Farmers of America and by using up a line of credit and a term loan. Hamer says she doesn’t know how much Titus’s legal counsel has racked up in bills. The line initially includes five organic flavors: vanilla, chocolate, strawberry, coffee, and mint chip. Meanwhile, in response to Hamer’s allegations Titus’s attorney, Eureka’s Steve Watson, released to The Enterprise hundreds of pages of depositions his client was part of during three days in January. Organic certification ensures that every item produced by Humboldt Creamery is from cows that have grazed on organic pastures free of pesticides, have not been treated with hormones or antibiotics and are fed from non-GMO feed sources. Bankruptcy was filed two months later, resulting in the sale of assets of the Humboldt Creamery at auction on August 27, 2009, to Foster Farms Dairy for $19.25 million. At Healthy Times, we pride ourselves on using premium ingredients in our products. “The board didn’t believe Ghilarducci was dishonest.” Hamer said that Titus met with her clients prior to them investing in the creamery and that they will testify “that Mr. Titus made glowing and positive statements about the financial health of Humboldt Creamery at those times.”. The launch of our ice cream line in Walmart represents just the beginning of what promises to be an exciting year for us.”. Steve and Malia dancing at Redwood Raks (Humboldt Creamery) May 12,2008 Our goal is to make Humboldt Creamery one of the leading organic dairy producers in the U.S. I was wondering if the same farms in Humboldt that had the cows before, are still working for the new Humboldt Creamery? © 2020 Lost Coast Communications Contact: news@lostcoastoutpost.com. Titus in his deposition, repeatedly states that he never made assurances to potential investors, never questioned figures given to him by his boss and did not actively solicit investors. This photo gallery contains additional, unpublished photos of dairy processing facilities featured in Dairy Foods magazine. Did the former chief financial officer for Humboldt Creamery know that business was sour? Humboldt Creamery announces its foray into the national dairy market with the launch of its first national product offering, a line of super-premium organic ice cream to be offered at more than 3,000 Walmart stores across the country. Founded in 1929 and owned by the Foster family since 2009, Humboldt Creamery, based in Fortuna, California, produces a variety of premium organic dairy products using cows’ milk from our family-owned farms in Humboldt County. Humboldt Creamery is nestled in the rolling hills of the Northern California seashore. An independent accountant’s report, commissioned by CoBank, in July of 2008 expressed concern with the creamery’s high debt, financial reporting system and insisted the company change auditors and bring in a new management consulting firm before a line of credit was extended. . Humboldt Creamery | 181 følgere på LinkedIn | Our history is rich, but our philosophy is simple: Cows are meant to graze. Noteholders say so; former CFO’s attorney resisting settlement to defend his client against allegations that he knew creamery business was in jeopardy, From June 20, 2013, print edition of The Ferndale Enterprise. This is where dairy should come from. Humboldt County is one of the most pristine places on the earth for grazing dairy cows and our company has a long history of making organic dairy products. Its organic ice cream brand is available nationwide thanks to a deal with Walmart. “Even after the 2008 bank audit, CoBank continued to push the securities offering,” said Watson. Seven years after nearly collapsing from a financial mismanagement scandal, Humboldt Creamery is ready to go national, courtesy of a deal between Foster Farms and Walmart. Humboldt Creamery is a certified organic creamery in Humboldt County, California. At Humboldt Creamery, we create wholesome, delicious, organic dairy products. Hamer said “discovery is continuing” as to the possible liability of CoBank. After 80 years as a small-town agricultural cooperative, Humboldt Creamery was forced into bankruptcy in 2009 after then-CEO Rich Ghilarducci was found to have cooked the books. (Disclosure: The Enterprise publisher/editor is related to Tony Titus by marriage. In our opinion, you can’t go wrong with that,” says Dennis Roberts, VP of Sales. Humboldt Creamery is a certified organic creamery in Humboldt County, California. . “From all indication, the insurance company has already paid a very large sum,” said Hamer. Humboldt County is a special part of California, where folks enjoy a simple and laid-back lifestyle and strive to take care of one another. ), P.O. Meanwhile, Titus has filed a motion for a summary judgment in Humboldt County Superior Court which will be heard on September 9. “Unfortunately, all of this turned out to be false,” said Hamer in a press release she sent to The Enterprise recently. 371 were here. At Humboldt Creamery, we have been creating wholesome and delicious dairy products for over 85 years. Hamer, however, said it was the former CFO and CEO’s obligation to disclose the contents of the independent auditor’s report “and the other negative financial information they knew to our clients and not to misrepresent the financial health of the creamery to them.”. “There’s no reason to issue a press release in the middle of litigation, except to get an upper hand or to malign someone.”. This is where dairy should come from. 30K likes. Photos by Vito Palmisano for Dairy Foods. Humboldt Creamery is flying high. ” stated Arcata attorney Chris Hamer, who said her clients invested in the creamery, some just weeks before Ghilarducci left town overnight warning against possible financial irregularities in the creamery’s books, believing the creamery to be “an incredible local success story, with sales expanding both nationally and internationally. And we do it in much the same way as we have for more than 90 years – working hand in hand with the natural environment and the near-perfect climate, as well as the many dairy families that help us … Humboldt Creamery s milk powders are used for infant formulas and cheese and candy manufacturing. That quality begins with a distinctive sense of place that is unlike anywhere else. “Our mission through this new product launch is to make organic ice cream accessible to a wider variety of consumers. Humboldt Creamery is a certified organic creamery in Humboldt County, California. And if so, did he have a responsibility to tell creamery investors? . “The risks were stated, which each plaintiff chose to accept,” said Watson, who argues that two of the plaintiffs were “sophisticated investors” and that Jerome Davis was on the creamery board during a time of expansion. The line of credit was extended and CoBank, according to exhibits, pushed for outside investments in the creamery — hence a round of preferred notes was offered to a select group of individuals in the community with wine and cheese informational sessions led by Ghilarducci. Our products include fluid milk, ice cream, butter, cottage cheese and sour cream. « Arcata to Require Sewage Pipe Inspections When Selling Older Properties, High Above the Streets of Arcata on a Beautiful March Day, Fixing a 99-Year-Old Bell Tower ». When asked why Hamer issued the press release, she said that the “wasting policy” is a “huge issue” and that Tony Titus himself may not be aware of it. There cows feed on fresh, lush grass and eat, and are treated to sunny weather… The co-op’s assets were sold at auction to Foster Farms Dairy, and while the Humboldt Creamery name and labeling survived, the creamery itself was subsumed into Foster Farms subsidiary Crystal. And Humboldt County provides an exceptional home to our cows. There are no shortcuts in making great tasting dairy products. Humboldt Creamery, Fortuna (California). In May of 2011, The Enterprise contacted CoBank for comment on the independent auditor’s report done by Dopkins & Company, LLC. In addition, Humboldt Creamery offers a variety of food service products, such as cheese, salad dressings, sour cream, butter and margarine. 30K likes. 30 mil Me gusta. The creamery was roiled by a bizarre accounting fraud scandal in 2009, during which its former CEO fled to Arizona after his supply of false financial statements to … And shoppers nationwide will now have the opportunity to sample the sweetness at America’s most popular and least loved grocery retailer, Walmart. Ultimately, Humboldt Creamery defaulted on its loan, causing a loss of between $7 to $20 million. Client: Humboldt Creamery Website Shot on location in beautiful Humboldt County, we produced this charming video to introduce the Creamery's new rebranded… Humboldt Creamery, the storied local dairy collective that was purchased by Foster Farms-owned Crystal Creamery after a 2009 fraud scandal, will stop processing fluid milk at its Fernbridge factory. The bank had none. Ghilarducci pleaded guilty last year to a … “We’re excited to begin offering super-premium organic ice cream products to consumers across the nation through our national deal with Walmart,” said CEO Frank Otis. While the suing investors’ attorney describes the lost $1 million as “loans” that her clients — Linda Nicholson, Tom Adam, Silverio and Sandra Fernandes, Jerome and Barbara Davis and Rick and Rebecca Santos — made to the creamery (“They received promissory notes, evidencing their loans, as a lender receives with any other loan,” said Hamer), Watson said investments were described as “high risk. Jan 30, 2020 - Delicious Humboldt Creamery recipes — made with organic milk, butter, cream, ice cream, sour cream, cottage cheese and more. Humboldt Creamery is a certified organic creamery in Humboldt County, California. Titus defended his action, stating that it was a rare occurrence and was usually used to cover checks just for one day. “The longer the lawsuit goes, the less money there will be available to pay the four couples when they go to trial . Hamer said Titus’s attorneys have made no settlement offers and have “rejected all settlement proposals made to them.” She said no additional mediation has been scheduled. “Our customers share our values. She questioned the Ferndale resident extensively about his use of a personal line of credit to cover cash flow several times at the creamery, as did Ghilarducci. Humboldt Creamery, Fortuna, California. Every dollar the insurance company pays to the attorneys defending Titus and Ghilarducci reduces the money available to pay any settlement of judgement to the plaintiffs. When contacted via email, Titus told The Enterprise he was aware of the nature of his insurance policy. In the press release, Hamer states that the money her clients could possible recover “is rapidly disappearing.” The Philadelphia Insurance policy is what is known as “cannibalizing,” “self-liquidating” or a “wasting” policy. But it’s still producing dairy products from the happy cows here in the bovine paradise of Humboldt County. Our certified organic products are the result of more than 85 years of sustainable farming practices, a deep respect for the health and welfare of our cows, and a commitment to quality in everything we do. “We believe this is contradicted by evidence that his pattern and practice was just the opposite: He always described the creamery’s financial health in glowing and positive terms.”, “My client did nothing wrong and we want to be able to prove his case,” said Watson when asked why he has not offered to settle. The former accountant of the creamery, Fortuna’s Frank Gloeggler, recently settled with the trustee and eight investors, paying out almost all of the accountant’s $1 million insurance coverage. The several-inches high stack of sworn testimony include dozens of exhibits and the creamery’s confidential psychological evaluation of Titus, describing the former CFO as a friendly and easy-going person with solid accounting skills “yet lacking in assertiveness and slow to confront or hold others accountable.” Watson states his client only took direction from Ghilarducci and Gloeggler and relied on audits “which he thought were competently completed.” The blame, suggests Watson, rests with the creamery’s major lender, CoBank, which suffered in excess of a $50 million loss when the creamery declared bankruptcy two months after Ghilarducci left town in February of 2009. “In fact, the creamery was on the verge of going out of business and insolvent.”. “Before Ghilarducci’s resignation in 2009,” states Titus, “I believed Ghilarducci to be honest.”. Now, with one unsuccessful mediation session between the eight investors, who are out a combined $1 million, and Titus’s attorney, the investors’ attorney is claiming that Titus’s legal counsel is unwilling to settle the case and is eating up insurance money which could leave investors even more in the hole and expose Titus to a paying any judgement out of his own pockets. “Titus had no reason to believe he (Ghilarducci) wasn’t honest,” said Watson. Titus wants a judge to rule that the lawsuit filed by the federal bankruptcy trustee on behalf of creamery creditors does not need to go to trial since he performed his job “honestly” for the creamery with continuous positive performance reviews. We hope that as you enjoy our dairy products, you will find an opportunity to explore the many incredible neighbors and innovators that … For Humboldt Creamery, quality and consistency build the foundation for success. They say Titus is an innocent man who just took orders from his boss, a CEO who eventually pled guilty to bank fraud and was sentenced to 30 months in federal prison. Its organic dairies have earned the Free Farmed certification from the American Humane Association (AHA). containers at an affordable price, making this a delicious treat for families, just in time for the spring and summer months ahead. “This is simply not credible,” stated Hamer. Investors in the creamery, as well as the federal bankruptcy court liquidating trustee, are suing former CFO Tony Titus and CEO Rich Ghilarducci in an attempt to access their $2 million professional liability insurance. For those lucky and special people that live in Humboldt :)) I just learned, like a silly late kid, that the Creamery was sold out after pretty much dieing with financials.and now it is owned by Farmers Dairy, or something like that. The judge also ordered 50-year-old Rich Ghilarducci to pay a $7 million fine. See more ideas about Creamery, Recipes, Delicious. Titus, however, said he referred questions about the creamery’s financial condition to his boss and that his role in meeting with investors was more of an “administrative” position. Titus’s lawyers, however, say they’re not willing to settle when their client has done no wrong and is now being maligned. “Throughout my employment with the Humboldt Creamery Association, and Humboldt Creamery, LLC, before Ghilarducci’s resignation in 2009, Ghilarducci controlled the financials∆1,” writes Titus in his motion. 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