- November 21, 2024
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Big Storm Brewing, a Clearwater company growing quickly in recent years — with splashy headlines to back it up — was hit by two legal actions in the past few weeks that raise questions about how it is operating and its financial decision making.
The two actions were filed within a few days of each other and follow a year in which the company already closed two locations, one of which, court papers allege, was more than $40,000 past due in rent on.
The first of the two most recent cases include an eviction notice filed in Hillsborough County May 31. That notice charged that Big Storm had not paid hundreds of thousands of dollars in back rent for an Ybor City taproom and restaurant and asked the court to allow the landlord to take possession of the building.
The second was filed June 5 in Pinellas County. In that lawsuit, an investor alleges he was lied to by the Big Storm’s owners to get $3 million of his money.
In a statement issued through a spokesperson, Big Storm’s co-owner L.J. Govoni says the Ybor City taproom will close June 16. As for the investor lawsuit, he says, “The claims made in this lawsuit are entirely false, baseless and lack any factual foundation and are designed solely to tarnish my reputation and embarrass my family.”
By most accounts, Big Storm has been seen — and has presented itself — as a company on the move, announcing new taprooms and the awards it has won in a steady stream of press releases.
It was founded in 2012 in Pasco County and added Big Storm Distillery in 2020. On May 30, 2023, the day an announcement was made that it had been named distillery of the year in Florida at the New York International Spirits Competition, it was operating five taprooms across the state — in Clearwater, Ybor City, Orlando, Odessa and Cape Coral.
A year later, only two stores will remain open after the Ybor City location closes.
The Cape Coral location shut down in September and the Odessa taproom was closed after an eviction notice was filed March 11 claiming $40,291.97 in back rent was due. A writ of possession was issued May 15.
The Ybor City taproom opened in February 2023 after a nearly year-long delay. The 11,000-square-foot facility was large by Ybor City standards and was on the second floor, away from pedestrian foot traffic.
It also faced a tough business environment as the economy soured and costs rose. This was happening too as conversations about the safety of Ybor City after an Oct. 29 shooting left two people dead — one 14 years old and one 20 years old — and 16 others injured.
That shooting prompted days of news coverage and citywide conversations about crowd crackdowns and potential curfews — two factors that most likely kept people out of Ybor City.
According to the complaint and exhibits in the evection filing, by the time the paperwork was filed Big Storm was $387,770.82 in arrears. (The eviction filing is only for possession of the property.)
Govoni, in his statement, says closing the taproom after just over a year was a “decision (that) was not made lightly” and went on “to extend our deepest gratitude to all of you who have supported us.”
The Pinellas lawsuit, though, points to more alleged internal issues going on in the company.
The lawsuit was filed June 5 by Clearwater oncologist Dr. David Wenk against Big Storm, Seaboard Craft Beer Holdings and Govoni. Seaboard is Big Storm’s parent company.
In it, Wenk accuses Govoni of falsely soliciting a $3 million investment by “misrepresenting the operational and financial health of Big Storm.”
He also accuses Govoni and the company of participating in a scheme to move money from the now-bankrupt Center for Special Needs Trust to Big Storm. The nonprofit, which has been accused of improper practices by the bankruptcy trustee in case, was started and run by L.J. Govoni’s father, Leo Joseph Govoni.
The younger Govoni, L.J., whose full name is Leo John Govoni, say in his statement that “Mr. Wenk knows full well that I have absolutely nothing to do with the Center for Special Needs Trust Administration.”
(Leo Joseph Govoni is part owner and a manager of Seaboard according to the lawsuit. Though he is not named individually as L.J. is, the lawsuit refers to him several times.)
Wenk says he first met the Govonis in 2012 at a Tampa Bay Buccaneers football game where they all had season tickets. Over the next couple of years, they socialized at games and in 2019 the Govonis proposed Wenk invest in Big Storm.
He turned down the offer.
Two years later, the Govonis tried again telling Wenk that the company was valued at $50 million and offering him a “friends and family” valuation of $40 million. That meant that for a $3 million investment, he’d get a 7.5% share of the company’s ownership, the lawsuit says.
That obviously was attractive because on May 10, 2021 Wenk went to Big Storm’s Clearwater headquarters and was shown how his $3 million investment would fund a planned upscale steakhouse and spirits room.
The following day Wenk was emailed a simple agreement for future equity. (SAFE forms, as they are known, “are flexible agreements providing future equity rights without immediate valuation” according to Investopedia.)
According to the lawsuit, Wenk signed a subscription agreement securing his 7.5% ownership interest on July 25, 2021 and on Jan. 7, 2022 wired the funds to Big Storm.
But, he claims in the lawsuit, the steakhouse and spirit room concept never materialized “revealing a pattern of mismanagement and misuse of invested funds.”
Govoni and Seaboard “failed to adequately disclose the operational and financial risks associated with the investment, and its presentations contained disclaimers that misled (Wenk) about the legal and financial implications of the investment,” the lawsuit contends.
“The actions of Seaboard and L.J. Govoni directly resulted in financial losses…due to misrepresentations and the failure to execute the proposed developments funded by (Wenk’s) investment. “
Govoni disputes the allegations, saying in the statement that the “accusations are not only unfounded but also defamatory, and I am committed to fighting them vigorously.”
“While the law affords a plaintiff the right to allege wrongdoings, it does not allow them the right to their own fictitious facts. The basis of Mr. Wenk’s lawsuit contradicts documents he himself signed stating his accreditation, sophistication and the due diligence he performed on this investment,” Govoni says.
“For him and his counsel to assert otherwise is nothing short of a bald-faced lie. I will not allow attacks on my character to go unchallenged and will pursue all available legal remedies.”
