Chill.com sells a variety of CBD, vape and wellness products in the U.S. (Stock photo)
Two Coloradans have been accused of stealing the domain name Chill.com, which is valued at $1.6 million, and embezzling $400,000 from the CBD company they once led.
They call those baseless allegations from executives engaging in systemic fraud.
Chill Brands, which is based in London, was founded in 2015 and formed an American subsidiary in 2019. The next year, it hired Antonio Russo of Grand Junction and Trevor Taylor of Palisade as co-CEOs based in Grand Junction, according to a July 24 lawsuit.
The company, which bought Chill.com for $1.6 million in 2022 and calls that its most valuable non-cash asset, has spent the past few months embroiled in unchill boardroom controversies, including allegations of theft and insider trading, while its stock price has fallen.
The saga began in April, when a meeting of shareholders was called to vote on resolutions removing Russo and Taylor from their positions, which were then chief commercial officer and chief operating officer following demotions from CEO. The duo responded by accusing CEO Callum Sommerton of insider trading. He was suspended pending an investigation.
Then, in May, a meeting was scheduled for the following month to determine Russo and Taylor’s future. According to Chill Brands’ lawsuit against them, “With only a month left before the shareholder vote, Russo and Taylor began a frenetic race to finish their scheme.”
That scheme involved transferring ownership of the domain name to a company they control for a price to be determined later, signing both sides of “sham agreements” granting them intellectual property rights, and awarding themselves a $400,000 severance payment, all without the approval or knowledge of Chill’s board, according to the federal lawsuit.
“We intend to vigorously defend the baseless allegations contained in the complaint,” said Russo and Taylor’s attorney, Paul Vorndran at Jones & Keller in Denver.
“We expect to demonstrate in court that the current leadership of Chill Brands Group has engaged in a systematic pattern of fraudulent conduct that has damaged my clients and which has caused significant harm to the investors of Chill Brands Group,” he added.
Russo and Taylor were fired by the board and Sommerton was reinstalled as CEO after an investigation found the information he traded on wasn’t inside info. Chill then sued Russo and Taylor for theft, breach of contract and trademark infringement, among other claims.
“We are totally shocked by the extent of destructive behavior and actions of Mr. Taylor and Mr. Russo,” Harry Chathli, the chairman of Chill Brands, said of the Coloradans in a June statement. “It is evident that they have not acted in good faith and their actions have been motivated by self-interest rather than for the benefit of the company or its shareholders.”
Chill.com has not yet been changed and can still be used to order Chill Brands products, which include a variety of vapes, drinks, edibles and more.
Amid the boardroom drama, the London Stock Exchange has suspended trading of Chill’s stock. A share is now valued at about two pounds, down from a high of 83 pounds in 2021.
“Shareholders can be assured that the current board will work unceasingly to ensure restoration of trading of shares and seek to regain the positive momentum,” Chathli said.
The company is represented by Kevin Bell in the Denver office of the Kilpatrick law firm.
Chill.com sells a variety of CBD, vape and wellness products in the U.S. (Stock photo)
Two Coloradans have been accused of stealing the domain name Chill.com, which is valued at $1.6 million, and embezzling $400,000 from the CBD company they once led.
They call those baseless allegations from executives engaging in systemic fraud.
Chill Brands, which is based in London, was founded in 2015 and formed an American subsidiary in 2019. The next year, it hired Antonio Russo of Grand Junction and Trevor Taylor of Palisade as co-CEOs based in Grand Junction, according to a July 24 lawsuit.
The company, which bought Chill.com for $1.6 million in 2022 and calls that its most valuable non-cash asset, has spent the past few months embroiled in unchill boardroom controversies, including allegations of theft and insider trading, while its stock price has fallen.
The saga began in April, when a meeting of shareholders was called to vote on resolutions removing Russo and Taylor from their positions, which were then chief commercial officer and chief operating officer following demotions from CEO. The duo responded by accusing CEO Callum Sommerton of insider trading. He was suspended pending an investigation.
Then, in May, a meeting was scheduled for the following month to determine Russo and Taylor’s future. According to Chill Brands’ lawsuit against them, “With only a month left before the shareholder vote, Russo and Taylor began a frenetic race to finish their scheme.”
That scheme involved transferring ownership of the domain name to a company they control for a price to be determined later, signing both sides of “sham agreements” granting them intellectual property rights, and awarding themselves a $400,000 severance payment, all without the approval or knowledge of Chill’s board, according to the federal lawsuit.
“We intend to vigorously defend the baseless allegations contained in the complaint,” said Russo and Taylor’s attorney, Paul Vorndran at Jones & Keller in Denver.
“We expect to demonstrate in court that the current leadership of Chill Brands Group has engaged in a systematic pattern of fraudulent conduct that has damaged my clients and which has caused significant harm to the investors of Chill Brands Group,” he added.
Russo and Taylor were fired by the board and Sommerton was reinstalled as CEO after an investigation found the information he traded on wasn’t inside info. Chill then sued Russo and Taylor for theft, breach of contract and trademark infringement, among other claims.
“We are totally shocked by the extent of destructive behavior and actions of Mr. Taylor and Mr. Russo,” Harry Chathli, the chairman of Chill Brands, said of the Coloradans in a June statement. “It is evident that they have not acted in good faith and their actions have been motivated by self-interest rather than for the benefit of the company or its shareholders.”
Chill.com has not yet been changed and can still be used to order Chill Brands products, which include a variety of vapes, drinks, edibles and more.
Amid the boardroom drama, the London Stock Exchange has suspended trading of Chill’s stock. A share is now valued at about two pounds, down from a high of 83 pounds in 2021.
“Shareholders can be assured that the current board will work unceasingly to ensure restoration of trading of shares and seek to regain the positive momentum,” Chathli said.
The company is represented by Kevin Bell in the Denver office of the Kilpatrick law firm.
