Ford vs. Ford: Estate battle on election eve
Progressive Conservative leader Doug Ford used money improperly siphoned from his late brother’s estate to prop up the failing family business, his sister-in-law Renata Ford alleges in a lawsuit filed a week before the imminent Ontario election.
Millions of dollars rightfully belonging to her and her children with Rob Ford are gone, she alleges.
Doug and a third brother, Randy, controlled the family’s Deco label-printing business and the estates of its founder, family patriarch Doug Sr., and Rob, and abused those positions for their own benefit, the lawsuit says.
Renata Ford has a substanceabuse problem and is making up stories to harm Doug Ford’s campaign, say statements the Progressive Conservatives issued in the names of the leader and his mother, Diane Ford.
“These claims relating to Deco are completely false and we will strongly refute them in court,” Doug Ford’s statement said.
“Renata’s lawyers have been clear to us throughout this campaign, that either we hand over money, or they would go public with these false claims, and that is exactly what they have done, with three days to go until the election.”
“It is heartbreaking that Renata has chosen to bring forward these false and baseless allegations against our family, right in the middle of the provincial election campaign,” said the statement from Diane Ford.
“As a family, our one goal is to ensure Rob’s children are cared for and their financial futures are secure. Renata has serious struggles with addiction, and our hope is that she will accept help for the sake of herself and my grandchildren.”
A call to Randy Ford at Deco’s corporate office — made afterhours Monday — wasn’t immediately returned.
The timing of the lawsuit probably couldn’t be more damaging. It strikes at the heart of Doug Ford’s pitch to Ontarians that he’s a successful businessman and a family man, alleging instead that he’s a calculating manipulator who made off with money that should have gone to his beloved brother’s wife and kids.
Renata Ford’s statement of claim, dated June 1 and not yet tested in court, says the three Ford brothers inherited Deco as a successful company from their father but Doug and Randy Ford mismanaged its operations in Toronto and Chicago and paid themselves “extravagant salary, bonus travel and automobile allowances and other benefits, which was paid regardless of the financial performance of those businesses.”
The lawsuit alleges that the two brothers, who ran the business while Rob Ford was a city councillor in Toronto, never agreed on a business plan, wasted money on bad acquisitions and dismissed staff who gave them advice they didn’t like. Randy Ford was a bad manager but Doug Ford made no effort to get rid of him, the lawsuit alleges.
The result was “the total operational failure of the Deco Companies’ businesses under their mismanagement and negligent direction,” the lawsuit says.
Former Deco employees have previously said publicly that Doug Ford ran Deco well but things fell apart after Rob Ford was elected mayor of Toronto in 2010, Doug took over his former city council seat, and left day-today control to Randy.
Deco Toronto lost money in six of the eight fiscal years from 2010 to 2017, the lawsuit says — as much as $2.1 million in 2016. The same year, Deco Chicago lost $595,000, the lawsuit says (it does not mention Deco Chicago’s performance in other years).
As the company’s financial situation deteriorated, the lawsuit says, the brothers arranged to move money from Doug Sr.’s estate to support it, knowing that “such infusions of funds ... were not viable or prudent investments which could reasonably be expected to earn any profit, and would not remedy the serious problems with the Deco Companies’ businesses.”
Between 2007 and 2014, the value of Doug Sr.’s investments declined from between $15 million and $20 million to approximately $6.4 million, the statement of claim says. It alleges that up to another $4 million might have been taken out of the estate after that.
“In effect, the defendants mismanaged the Deco Companies to the point of insolvency, and then plundered Doug Sr.’s estate to maintain the illusion that they were successful businessmen and to retain their offices and compensation,” the lawsuit says. They were “in multiple conflicts of interest and duty, and acted consistently and only to prefer their personal interests over those of estate beneficiaries, shareholders and stakeholders, including the plaintiffs,” it says.
As trustee for Rob Ford’s estate, Doug “improperly retained and withheld assets, funds and information from distribution to the plaintiffs, in an attempt to keep his misconduct secret,” including a $220,000 life-insurance payout and the contents of Rob Ford’s bank account, the lawsuit says.
It quotes an agreement between Doug and Renata in October 2016, nearly seven months after Rob Ford died, meant to help her deal with a decision she legally had to make about her husband’s assets but couldn’t because Doug hadn’t yet provided her with a list of them.
Doug also sold Rob’s shares in Deco Toronto to Randy for $1, the lawsuit alleges, and left the estate “no continuing interest in Deco Toronto and Deco Chicago.”
It says that at one point, Doug Ford proposed to Renata that they settle Rob’s estate between them, without lawyers who would just rip her off, which she declined.
In addition to an estimated $10 million in specific damages, the lawsuit demands $5 million in punitive damages for Doug and Randy’s “deliberate, repeated and ongoing misconduct.”
Renata Ford’s lawyers are Don Jack and Martin Henderson, experienced litigators at Toronto business-law firm Aird & Berlis.
It is heartbreaking that Renata has chosen to bring forward these false and baseless allegations against our family.