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The Suburbanite
  • 2012 debt dispute splits Canton Marathon

  • Co-founder says partner created financial problems by borrowing from race fund

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  • For anyone planning to run a marathon in Canton this summer — the route gets more twisted and tangled by the day.
    First came an announcement last week by Stephen Mears:
    The chief executive and co-founder of the financially troubled 2012 Canton Marathon said the 2013 event is definitely a go. He hailed alterations and improvements. He had changed the name of the race to the Hall of Fame City Challenge. He offered a New Year’s Day discount on runner registrations. And he had parted ways with Julia Dick, president and co-founder. Mears said the two had differing opinions on how to move the race forward.
    Dick had remained silent until issuing a single-page response this week:
    The real Canton Marathon, her race, is to be held Sunday, June 16. That’s one day after Mears’ new race.
    What’s more, she revealed that Mears and his company, StrategyONE, previously had borrowed more than $100,000 in race funds, effectively holding up payments to other vendors. Mears, she said, signed a promissory note, agreeing to pay back the Marathon $150,000. She said it’s inappropriate for him to collect fees for a new race to pay off vendors — all while he and his company owe such a large tab.
    And on Friday, Mears filed a complaint in Stark County Common Pleas Court seeking to dissolve their business partnership and conduct an accounting of Canton Marathon financial records.
    Mears explained his actions in a statement, writing, “I very much enjoyed working with Julia putting together the first marathon, but we've reached a point in our business dealings where we can no longer work together on this project. Our philosophies are opposite when it comes to running this event, so I am now forced to go in a different direction.”
    HER SIDE
    Dick said her attorneys advised her not to comment beyond her written response, which was emailed to The Repository on Thursday. She would not say if she’s planning to sue Mears or elaborate why she retained an attorney.
    She didn’t specify how or why Mears borrowed marathon money. However, she seemed to indicate she was not aware of it until after the fact. She used words like ‘investigated’ and ‘discovered’ in her letter.
    “Unfortunately, I put my trust and confidence in Mr. Mears and I was shocked to discover the amount of funds that he borrowed from the company,” she wrote.
    HIS RESPONSE
    Contacted for this story, Mears didn’t deny most facts laid out by Dick. Mears did sign the $150,000 promissory note in September, but said he did so under duress. He said StrategyONE, his marketing firm, provided services to the event, and was rightfully due much of the cash that he has now agreed to pay back.
    Page 2 of 2 - “I wish there was better documentation,” he said.
    The Repository previously has reported on race financial woes. They included laid-off employees; a canceled recognition event; vendors and cities that were not, and still have not, been paid in full. In a story last week outlining plans for this year’s race, Mears acknowledged $80,000 still is owed to cities and vendors.
    He did not, however, mention the additional $150,000.
    And, during a previous interview in October, Mears and Dick both said they were not paid to organize and operate the marathon. On Friday, Mears clarified that statement. He said no company salaries were paid with marathon funds.
    “But StrategyONE has been all-in on this from the start,” he said.
    DIFFERENT VISIONS
    Held on Fathers’ Day weekend last year, more than 5,000 runners competed in either the marathon, half-marathon, 10K, relay or kids’ run.
    The Canton Marathon is owned by a private company called Canton Marathon LLC, held jointly by Dick and Mears. The co-founders also formed a separate private nonprofit corporation of the same name to distribute some race proceeds to charity.
    A percentage of online registration fees from last year’s race were divvied out to about a dozen local charities.
    Mears said Dick had the same access to financial records as he did. Many payments made to StrategyONE were approved by her, he said. Mears said he had to break away to ensure the race survives.
    “This race is too important for the community,” he said.
    The sticking points it seems, based on what Mears said and what Dick wrote:
    • Dick wanted a marathon this year, but didn’t want to solicit corporate sponsorships or accept fees from runners until after Mears paid the $150,000 bill in full.
    • Mears wanted a marathon this year, but he said it’s OK to begin collecting sponsorships and fees at the same time he pays off the $150,000 bill and the $80,000 due other vendors. He said it’s necessary, because the event, like many start-up businesses, has a cash-flow problem now.
    “She left me no choice, but to create a new race,” he said.