The former CEO of a Shane Co. subsidiary has sued the jewelry company and its prominent founder, accusing the latter of creating the company to give jobs to girlfriends.
Tom Shane, 74, founded Shane Co. in Denver in 1971; it now has 21 jewelry stores in 14 states. The wealthy Denverite is also the dulcet voice behind Shane Co’s popular radio ads, which end by reassuring listeners, “Now you have a friend in the jewelry business.”
The lawsuit filed March 10 claims that Shane had some girlfriends in the jewelry business.
Melissa Edison Barnes said she met Shane in 2018, when they agreed to start a company called Shepherd’s Stone to make Christian jewelry and sell it at Shane Co. stores. Shepherd’s Stone jewelry featured stones that revealed a cross when light shone on them.
Edison Barnes, who had piloted several other companies before then, agreed to become the CEO of Shepherd’s Stone and accept a lower salary — $100,000 less than the market average, by her count — in exchange for a 15-percent stake in the new company, she said.
Though Tom Shane was the majority owner of Shepherd’s Stone and a Shane Co. employee was brought in to oversee product development, Shane never actually intended to have Shane Co. sell Shepherd’s Stone jewelry, Edison Barnes’ lawsuit now alleges.
“In reality, Mr. Shane’s purpose in starting the new company was to provide employment to his Colorado-based girlfriend … as well as his Bangkok-based girlfriend and to hide from others the extent of his financial support for these women,” that lawsuit states.
Requests for comment from Shane were not answered this week. In an emailed statement, a Shane Co. representative declined to discuss the allegations.
“We have been made aware of the recent lawsuit filed against Shane Co.,” the company said. “We take this and any legal claims against the company seriously and are reviewing it with our legal team. As a policy, we don’t comment publicly on pending litigation and will respond through the appropriate channels.”
Shane and his first wife, Valere, divorced in 2005, court records show. It’s not clear from public records whether he was married at the time Edison Barnes said he had girlfriends.
Attempts to contact Shane’s alleged girlfriend in Denver, who is named in the lawsuit, were not successful. Shane’s alleged girlfriend in Thailand is identified only by a first name.
Shane, who blogs about his company and his travels on Shane Co.’s website, has written several times about his weeks-long trips to Bangkok, where his company has a factory. In 2018, he called it his “home away from home” and said he goes there eight times a year.
“Tom lives half of his life in Denver and half in Bangkok,” according to an online biography. “He personally oversees the buying of the rubies and sapphires while in Bangkok.”
Edison Barnes alleges that Shane’s romances led to bad business decisions at Shepherd’s Stone. His Denver girlfriend was given a prominent role despite her lack of experience, then Shane wasted time and money trying to “create a vendor relationship” between Shepherd’s Stone and the place in Bangkok that his girlfriend operated, Edison Barnes said.
By mid-2021, several years after Shepherd’s Stone was founded, the company finally had a product to sell, according to its former CEO’s lawsuit. That’s when Shane Co. executives, led by Tom Shane’s son Rordan Shane, declined to sell the product in Shane Co. stores.
As 2021 turned to 2022, Tom Shane’s Denver tryst ended, so he talked with Edison Barnes about closing Shepherd’s Stone down by fall 2022, according to her. The company closed for good on Jan. 31 of this year and Edison Barnes was laid off, her lawsuit claims.
That lawsuit, filed in Arapahoe County District Court, seeks an undetermined amount of money that Edison Barnes said she lost out on when she took a smaller-than-expected salary in exchange for stock in a company that folded soon after Shane’s one affair ended.
“At the time that she signed on as CEO for Shepherd’s Stone, Ms. Edison Barnes believed that Mr. Shane intended to use his best efforts to promote the company, and that the company had the potential to be very successful,” her lawyer Anthony Viorst told BusinessDen.
“Ms. Barnes estimates her damages in this case at no less than $500,000,” he said.
Before joining Shepherd’s Stone, Edison Barnes was the co-owner of FruitRevival, a company that delivered healthy snacks to offices, according to past media reports. She is now the president of IEQMax, an indoor air quality monitoring company, her LinkedIn says.
She is represented by Viorst and David Chambers with the Viorst Law Offices in Denver.
Correction: A reference to a blog post on the Shane Co. website detailing a marriage proposal has been removed.