Allied's Expert Testimony Helps Clear Local Businessman of Embezzlement Charges

July 2015 | Allied Business Group       Print

After two years of litigation, Jim Sheridan, the founder of Sheridan's Frozen Custard and a client of Allied Business Group, has been cleared of embezzlement charges by the Johnson County District Court.

In 2013, Sheridan was accused of embezzling between $330,000 and $500,000 from the company's National Advertising Fund ("NAF"), a fund set aside for Sheridan Frozen Custard franchisees. Ron Hendrix, the owner of three Sheridan's franchises, filed a suit in June 2013 alleging that Sheridan had used embezzled funds from the NAF for personal interests, including the development of his other restaurant, Unforked. The suit also accused Sheridan of receiving improper rebates from suppliers. However, Sheridan claimed to have made personal contributions to the NAF and was removing money from the fund to repay himself.

Sheridan engaged Allied Business Group to provide litigation support and expert witness testimony relating to the allegations brought against him. As an expert witness, Allied President David Holzman prepared an accounting of Sheridan's NAF from 2003 to 2014 to determine whether the amount of funds Sheridan removed from the NAF exceeded the amount he had previously loaned. Further, Holzman also tracked and reviewed all supplier rebates paid to Sheridan.

Through his analysis, Mr. Holzman determined that the contributions previously made by Sheridan to the NAF exceeded the amount he removed. He presented his findings through a formal report, and shared his conclusions through deposition. Mr. Holzman also provided a report outlining discrepancies and errors in a report provided by an expert witness hired by the plaintiff. Mr. Holzman's analysis and testimony helped refute the plaintiff's allegations and all claims against Sheridan were dismissed.

Read more about the case in this article published last week by the Kansas City Business Journal.