ICYMI: Star Reveals Davids Owes Investors $20k for Failed Business, Still Hasn't Paid

FOR IMMEDIATE RELEASE

Friday, October 19, 2018

 

Overland Park, KS - This morning, the Kansas City Star revealed that Sharice Davids - who calls herself an expert in economic development - still owes $20,000 to investors for her failed business venture and has yet to repay any of the loan after a court issued a judgement against her. 

The full text of the article is reproduced below, along with a statement from Yoder for Congress Campaign Manager CJ Grover: 

"Perhaps this is why Sharice Davids has refused to debate Kevin Yoder throughout this campaign. She wants to hide her failed business record just like she wants to hide her radical policy views. Her support for socialist programs would bankrupt America, just like she bankrupted her company.

"Now that this has been revealed, Davids needs to answer more questions. Does she ever intend to pay back her investors? Why has she hid this from voters until now? What record does she rely upon to call herself an 'economic development expert?'

"Sharice Davids needs to be more transparent. Voters deserve answers, and she isn't giving them."

 

Click here to read the article online | October 19, 2018

 

BY BRYAN LOWRY

WASHINGTON - More than two years have passed since a South Dakota judge ordered Sharice Davids' failed coffee company to repay investors nearly $20,000, but those investors have yet to receive a penny.

South Dakota Circuit Court Judge Robert Mandel ordered Davids' Hoka Coffee Company to pay New Vision Venture Partners $19,539 in January 2016.

Eight months later, Davids was selected for the prestigious White House fellows program by President Barack Obama's administration. The Obama White House pointed in a news release to her experience running the business as one of her qualifications for the program.

Davids is challenging four-term Republican Rep. Kevin Yoder in Kansas' 3rd congressional district and could make history as the first Native American woman in Congress if she wins.

The Johnson County Democrat was virtually unknown in Kansas political circles until she launched her campaign in February. She leads Yoder 48 percent to 39 percent in a poll conducted this week by The New York Times and Siena College.

Before launching her campaign, Davids had a unique career path that included five years on the Pine Ridge Indian Reservation in South Dakota, where she ran an economic development program at Red Cloud Indian School and later served as deputy director of Thunder Valley Community Development Corporation, a nonprofit that helps launch businesses and build housing on the reservation.

But her own attempt to launch a coffee business on the reservation, proved unsuccessful.

"It was this small break-even operation," Davids said last month when asked about her coffee venture. "Like a lot of small businesses, you hit that fork in the road where the business either has to grow or stop... and so Hoka closed the doors because it just wasn't growing."

Hoka said in a November 2017 Facebook post that it stopped operating the previous year because of limited funding. The post was made more than a year after the judge ordered Hoka to pay back New Vision Venture Partners the balance and interest owed on its 2013 investment in the company.

The venture capital firm, which invests in businesses on Pine Ridge, has not been paid "by either Hoka Coffee or Davids" since the ruling, said Chuck Miller, the vice president of CEM and Associates, a Colorado-based company that is New Vision's sole funding source.

Davids emphasized that she was not personally liable in the case and appeared to downplay her role in the business in a statement issued by her campaign Thursday.

"There was no loan made to me - it was a business loan made to Hoka Coffee, a coffee company that I helped launch. And the judgment only pertained to Hoka Coffee, an LLC, and not me personally. Nothing wrong or unusual occurred here - this is incredibly common when entrepreneurs try to start small businesses," Davids said.

An LLC is type of business meant to shield owners from liability. Davids is the sole name listed on the company's articles of organization that were filed with South Dakota in 2013. Her title is manager on the official paperwork, but a 2013 Facebook post from the company refers to her as the company's owner.

Haven Stuck, the attorney for New Vision, repeatedly emphasized that the suit was against Hoka Coffee rather than Davids, but he confirmed that Davids was served the complaint in October of 2015 in her capacity as the company's registered agent.

Davids, a graduate of Cornell Law School, did not contest the lawsuit against her company, according to court documents. The judge issued a default judgment after Hoka failed to respond to the complaint.

"We got no explanation of why they didn't respond. It's not that unusual in a case like that," Stuck said in a phone call.

Davids' campaign spokeswoman Allison Teixeira Sulier said that the company did not defend against the lawsuit because it no longer had any assets. This is also reason why investors have not been paid after the judgment, she said.

Stuck said that his clients have little recourse to collect the money they're owed because the judgment is against the company, which no longer exists. Records from the South Dakota secretary of state's office show the company was officially dissolved this year after failing to file an annual report for the last three years.

"As far as we know the company has no assets, so we've not gotten any payment on the judgment," he said.

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Paid for by Yoder for Congress, Inc.