A co-owner of Springfield’s First Watch restaurants is suing his business partner.
Joseph Hulston, a 50% co-owner of Ozark Endeavors LLC, is suing James Tillman, the other co-owner, for fraud, misappropriation of funds, and breach of fiduciary duty. James Tillman’s wife, Lisa Tillman, also is a defendant. Ozark Endeavors, LLC manages various LLCs operating First Watch locations in Springfield, Joplin, Lake of the Ozarks, and northwest Arkansas.
The lawsuit, filed April 19 in Greene County Circuit Court, alleges Tillman raised his own salary, directed wages be paid to his wife and daughter, misused company credit cards, and moved the LLC headquarters to a rental space he owned, all without Hulston’s knowledge.
Hulston and Tillman are also co-owners of Kansas & Kearney, LLC, which holds a ground-up development site, selling development lots to commercial buyers. In this venture, Hulston and Tillman own 70% and 30% stakes, respectively. Hulston also alleges Tillman signed a letter of intent to sell the Kansas & Kearney property without his knowledge and refused to comply with debt and expense obligations.
Tillman also operates the Huey Magoo’s and Casa Bella locations in Springfield, as well as a long list of LLCs registered with the Missouri Secretary of State. The suit says Tillman has a conflict of interest due to his financial interest in these businesses. In addition to the fraud and misuse of funds, the suit alleges Tillman directed money, contracts, work, and business opportunities to entities he owned to the detriment of Ozark Endeavors. Tillman also allegedly instructed employees not to provide business information to Hulston and made disparaging comments about him.
Hulston, Ozark Endeavors LLC, and the LLCs it manages, are seeking punitive and actual damages in an amount found “fair and reasonable” by the court. The lawsuit also states that Tillman should be removed as manager of the plaintiff LLCs and be forever barred from exercising business decisions on behalf of them. Hulston also wants Tillman to pay his legal fees.
Suit: Tillman raised own salary, paid wife and daughter
According to the lawsuit, Hulston and Tillman did not take home consistent wages or compensation in the first three years of business. In 2020, the pair agreed to set their respective salaries at $60,000, with remaining compensation to come in the form of equal distributions. Between 2021 and 2022, Tillman allegedly raised his own salary without Hulston’s knowledge three times: first to $100,000, then to $150,000, and finally to $210,000.
Tillman continues to receive this $210,000 salary despite Hulston’s demand that he reset it to the agreed-upon $60,000, the suit says. Hulston still receives a $60,000 salary despite having an equal position to Tillman’s.
Lisa Tillman, James Tillman’s wife, is also named in the suit, which says she claims to assist Ozark Endeavors’ full-time accountant in matters relating to the First Watch restaurant and Kansas & Kearney property. The full-time accountant’s salary was originally set at $50,000, then increased to $63,000. The lawsuit alleges Tillman directed a salary of $65,000 be paid to his wife for assisting the full-time accountant without Hulston’s knowledge, permission, or agreement.
Lisa Tillman’s salary was raised two times, the lawsuit says: first to $70,000, and then to $75,000 — $12,000 more than the full-time accountant. The lawsuit notes Hulston specifically objected to Lisa Tillman being paid more than the accountant or any raise without his permission. Hulston has demanded Tillman stop his wife’s salary, but Tillman has refused.
The suit also names Tillman’s daughter, Jamie Tillman, who was formerly employed at the First Watch on National Avenue. It alleges Tillman directed the LLC in charge of the restaurant to pay his daughter a salary and directed Ozark Ventures to provide her employee healthcare benefits. According to the lawsuit, Jamie Tillman continued to receive wages and healthcare benefits after leaving employment at First Watch. Ozark Endeavors continues to pay for Jamie Tillman’s healthcare coverage. Tillman has allegedly refused Hulston’s demands to stop and reimburse the payments.
Tillman, his wife Lisa Tillman, and their daughter Jamie Tillman did not respond to multiple requests seeking comment for this article.
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Allegations of fraud, misrepresentation, misuse of company credit cards
According to the lawsuit, Ozark Endeavors entered a lease agreement for a rental space to house its headquarters at 610 E. Battlefield Road in 2019, with monthly rental payments of $1,710. In September 2022, without notifying Hulston, Tillman allegedly moved the headquarters to a rental space at 1840 S. Ingram Mill Rd. owned by J&M Tillman LLC, a business controlled by Tillman. Upon the move, the monthly rental cost increased to $9,750.
The lawsuit says the original lease space was more than adequate, and there was no business reason for Ozark Ventures to move to Ingram Mill Road. Tillman has allegedly refused to provide lease documents related to both spaces and an explanation as to why rent increased by more than $7,000 per month.
The lawsuit says six people from Ozark Endeavors were granted company credit cards for convenient payment of business expenses, including Hulston, Tillman, and Lisa Tillman. Hulston alleges Tillman and Lisa Tillman have used the credit cards for personal use and to support their own businesses. Charges include Amazon Prime movie purchases, clothing, domestic and international travel, TV subscriptions, construction charges, fuel charges, auto repairs, groceries, and home improvement costs. According to the lawsuit, Tillman has refused Hulston’s demands for credit card statements and business justifications for the suspicious charges incurred.
Unlike the First Watch restaurants and Ozark Endeavors, Hulston is a 70% owner in Kansas & Kearney, while Tillman is a 30% owner. Tillman allegedly represented himself as the sole owner of the business to a real estate agent and told the agent to cease any further contact with Hulston. Then, the suit says, Tillman signed an $825,000 letter of intent to sell the Kansas & Kearney property.
The plaintiffs, who are Hulston; Ozark Endeavors, LLC; National Avenue FW, LLC; East Sunshine FW, LLC; Lake of the Ozarks FW, LLC; Joplin FW, LLC; Rogers FW, LLC, Bentonville FW, LLC; North Fayetteville FW, LLC; and Kansas & Kearney, LLC, are represented by attorney Bryan Wade.
