Johnny Depp Sues Former Business Managers for $25 Million
Johnny Depp has sued his former business managers, alleging “gross misconduct” that resulted in the actor losing “tens of millions of dollars.”
The managers have denied the allegations and responded that the suit is a fabrication and a result of Depp’s “profligate” spending.
Depp made the allegations in a lawsuit filed Friday in state court in Los Angeles. Depp filed the complaint, which is 52 pages long, against The Mandel Co., The Management Group, Joel L. Mandel, Robert Mandel, First American Title Insurance Co. and 15 other unnamed defendants.
The “Pirates of the Caribbean” actor is seeking a jury trial and asking for conpensatory damages of at least $25 million. Depp alleged that the self-dealing by TMG was so extensive that he’s been forced to sell off assets to pay for the losses.
“Mr. Depp is one of the most sought after and highly paid actors in the world,” said attorney Matthew Kanny in the complaint. “He is also the victim of the gross misconduct of his business managers — The Management Group and attorneys Joel and Robert Mandel — who collected tens of millions of dollars of contingent fees, purportedly based on an oral contract, all at Mr. Depp’s expense.”
Depp is seeking a jury trial and asking for damages of at least $25 million. The suit contains 11 causes of action, including professional negligence, fraud, negligent misrepresentation and unjust enrichment.
“Like many succesful artists who depend on financial professionals to advise them, Mr. Depp trusted and reasonably relied on TMG to handle his financial and certain legal affairs and to ensure that he and his family would have a financially secure future, built upon the foundation of the susbtantial moneys Mr. Depp earned through years of hard work,” the complaint said. “But instead, as a result of years of gross mismanagement and at times, outright fraud, Mr. Depp lost tens of millions of dollars and has been forced to dispose of significant assets to pay for TMG’s self-dealing and gross misconduct.”
“It was only recently, when Mr. Depp terminated TMG and hired new business management and accounting services, when Mr. Depp learned the gravity of his financial losses and some, but surely not all, of the underlying facts,” the complaint also alleged.
Michael Kump, attorney for TMG and the Mandels, issued a statement Friday calling the suit a complete fabrication. “For 30 years, Joel and Rob Mandel, and their company The Management Group, have been trusted business managers to some of the most successful individuals and companies in the entertainment business,” Kump said.
“For 17 of those years, they did everything possible to protect Depp from his irresponsible and profligate spending. In December 2012, Depp faced financial ruin with the impending default on a $5 million bank loan. The Mandels bailed him out by loaning him $5 million, which he promised to repay by January 2014. Although Depp later changed managers, he never alleged any wrong doing. In October 2016, with Depp still owing $4.2 million, the Mandels started non judicial foreclosure proceedings against certain of Depp’s properties. Depp’s lawsuit, filed on the eve of the sale of those properties, is a transparent attempt to derail the foreclosure by concocting and spreading malicious lies about the Mandels. His tactics and lawsuit will fail, and he will be forced to pay back the loan as promised.”
Depp filed suit with Edward L. White as trustees of the Mooh Investment Trust. In addition to seeking a jury trial, the action also seeks a temporary restraining order and permanent injunction to prevent the sale of Depp’s properties.
The allegations include that TMG paid itself more than $28 million in contingency fees without a written agreement and failed to file or pay Depp’s federal taxes on time, leading to $5.6 million in fees and penalties. The suit also accused TMG of “loaning” nearly $10 million to third parties without Depp’s authorization.
“In essence, TMG treated Mr. Depp’s income as their own, available to either TMG or third parties to draw upon as desired,” the complaint said. “TMG’s gross mismanagement and fraud remained undetected as TMG borrowed millions of dollars to survive from movie-to-movie.”
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