Daymond John Files Lawsuit Against Former Partners Over PPE Business Dispute
Daymond John has filed a lawsuit against his former business partners, Lisa Kornman Avila and Rashmi Budhram, alleging that they excluded him from a profitable PPE business that saw significant growth at the start of the COVID-19 pandemic. The lawsuit, filed in the New York Supreme Court, claims that John was promised a share of the commissions from major state contracts for masks, gowns, and other protective equipment but never received it. John's connections helped secure government purchase orders worth hundreds of millions of dollars, but he alleges that he was cut out of the profits.
John brought Buko LLC into the deals due to their manufacturing relationships that could source hard-to-find PPE. The Shark Group, John's company, had a longstanding arrangement with Buko where they would introduce clients and receive a percentage of the resulting revenue. This structure was maintained when state governments urgently needed supplies in the spring of 2020. The complaint also states that The Shark Group leveraged John's name, reputation, and network to secure deals with various state entities.
The lawsuit highlights a specific deal with California, where Buko reportedly collected over $146 million from the state for PPE orders. The alleged agreement between the parties stipulated that The Shark Group would receive up to 20 percent of revenue and one-third of net profits. Despite assurances from Kornman that John would benefit more than usual, he claims he did not receive the agreed-upon share of the profits.
The legal action also addresses the chaotic PPE market in 2020, characterized by states scrambling to secure supplies amid widespread fraud concerns. John faced allegations of price gouging in Florida, which he denied, emphasizing his role in vetting suppliers and safeguarding taxpayer money. The lawsuit asserts that Kornman and Budhram ceased communication with John shortly after these allegations surfaced and restructured their business to evade paying him.
In response to the alleged breach of agreement, John is seeking damages, punitive damages, attorneys' fees, and a jury trial to address the financial losses he claims to have incurred due to being excluded from the lucrative PPE business.