The future of West Sacramento’s TBD Fest has become cloudier following a new lawsuit filed against the event’s founders.
Clay Nutting and Michael Hargis, who launched the multi-day music festival in 2014, are being sued for breach of contract over nonpayment of a $100,000 loan plus an additional $10,000 in interest.
The lawsuit was filed June 29 in Sacramento Superior Court on behalf of DeWolf Emery, a festival investor based in the San Francisco Bay Area, and also names TBD Fest LLC as a defendant. The lawsuit further alleges Emery failed to receive a 20 percent membership interest in EMCEM Provisions LLC as stipulated in the loan agreement. EMCEM Provisions LLC is a holding company that oversees ownership interests in TBD Fest and LowBrau, the popular midtown beer garden and eatery co-founded by Nutting and Hargis.
According to the lawsuit, Emery provided a $100,000 loan to the defendants in August 2014, about two months before TBD Fest debuted in West Sacramento and was to be paid back by Sept. 21, 2014. The festival, which featured a lineup of cutting-edge musical acts along with local food and art, drew thousands in 2014 and 2015 to the Bridge District of West Sacramento near the Sacramento River.
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Emery and his attorney, Michael Chase, declined to comment about the case to The Bee. Nutting and Hargis did not immediately make themselves available for comment. Nutting later referred questions to TBD Fest LLC lawyer Mark Gallagher.
“As far as the lawsuit, we were expecting it and doing what we can to get it wrapped up quickly,” said Gallagher, a Folsom attorney who represents Hargis and TBD Fest LLC. “We’re working with their counsel and hopefully it can be resolved before it goes too far down the road of litigation.”
The current lawsuit adds to the financial woes that have dogged TBD Fest for its duration.
According to organizers, TBD Fest lost an undisclosed amount of money in 2014 and 2015, leaving some vendors unpaid following the events, including a backstage caterer and some local visual artists.
In October 2015, the talent agency representing the TBD Fest headliner Pretty Lights sent a letter of demand to festival organizers for $92,500 owed on a performance fee of $185,000. The $92,500 balance ultimately was paid more than a month following the deadline specified in Pretty Lights’ contract to perform at TBD Fest.
Jason Malmberg, a Sacramento-based graphic artist, said he’s still owed more than $5,000 from TBD Fest organizers. He was responsible for creating all branding and imaging for the 2015 festival, including signage at the event, illustrations, a poster art series, social media graphics and other work.
“I worked with them all last year, for nine months straight,” Malmberg said. “Leading up to the festival (the invoicing) was up near $9,000, but in the end I decided to be a nice guy and pared it down to a little over $5,000. We were all in this afterglow of, ‘Look what this city did,’ but I didn’t know so many people were getting stiffed.”
In December, Nutting was named in a lawsuit over nonpayment of a $200,000 loan. The breach of contract lawsuit was filed by Katrina Arnaud, a Sacramento-based public notary, who was to be repaid through monies received from TBD Fest sponsorships and ticket revenue. The lawsuit is pending in Sacramento Superior Court.
TBD Fest organizers have yet to announce plans for a third year of the festival. According to Cindy Tuttle, director of parks and recreation for West Sacramento, the department has not received any permit applications for a 2016 version of TBD Fest, nor has it communicated with festival staff to plan a future event.
A case management conference for Emery’s lawsuit is scheduled for Dec. 29 in Sacramento Superior Court.