According to the complaint, Theodent hired an outside CPA to investigate Sadeghpour’s spending. In a letter to Theodent’s officers, the CPA noted: “Arman set up a system without any semblance of internal controls. He used the Theodent corporate assets as if they were his personal ATM.”
New Orleans, La. (December 9, 2021) — The revolutionary toothpaste company Theodent filed a lawsuit to hold former CEO Arman Sadeghpour accountable for the alleged misappropriation of over $1 Million of corporate funds, breach of duties, and fraud. According to a complaint filed by the law firm Peiffer Wolf Carr Kane & Conway (Peiffer Wolf), “Sadeghpour’s misuse of Company funds was a prolonged and ongoing operation … Theodent estimates that Sadeghpour wrongfully charged Theodent over $1.2 million worth of personal expenses during his ill-fated tenure at the Company’s helm.”
Peiffer Wolf described Sadeghpour’s serial misuse of company funds and breach of duties at a news event on the stairs of the 24th Judicial District Court in Jefferson Parish featuring Dr. Tetsu Nakamoto and Joseph Fuselier, two of the five Theodent co-founders.
Daniel Centner, Peiffer Wolf partner, said: “Actions have consequences, and today Theodent took steps to hold Arman Sadeghpour accountable for what we believe was theft, to the tune of nearly $1.2 million worth of Theodent’s money. Arman’s misappropriation of company revenue for his own personal gain was an egregious abuse of power. With all that spending, one is left to wonder how Arman had time to pretend to run a company.”
In addition to his gross misuse of Theodent funds, Sadeghpour consistently rebuffed repeated requests made by other members of the Board to install a CFO or simply hire an additional accountant to keep track of expenses, claiming that Theodent “couldn’t afford it.” Unbeknownst to the Board members at the time, Sadeghpour also side-stepped concerns expressed by the third-party CPA hired to do Theodent’s taxes, assuring her of the legitimacy of various line-item expenses after she questioned falsified entries in the company’s bookkeeping software that had been provided without receipts.
In the months following Sadeghpour’s removal, it became apparent that he failed to completely discharge his duties as Theodent’s President and CEO. Most concerning, Sadeghpour failed to pay the USPTO to keep the company’s trademark current, which was resolved quickly after it was discovered.
Theodent hired an outside CPA to further review Sadeghpour’s spending, and she stated, “I’ve worked as a CFO and consultant for many years and have yet to see a more blatant misuse of funds than I see working with the Theodent financial reporting… [Sadeghpour] created a system well designed for obfuscating the real nature of his abuse of corporate assets. It only became clear that something might be wrong when sales continued to increase year after year but the net income didn’t follow. It appears that Arman was conscious of not spending enough to require additional investments or trigger losses but largely accrued any remaining income for his personal use.”
Joseph Fuselier, a Theodent co-founder, said: “We are here today because our former CEO, Arman Sadeghpour, misappropriated more than $1 million from the company. We worked very hard to avoid taking legal and public action, but Arman forced our hand.”
Dr. Tetsuo Nakamoto, a Theodent co-founder, added: “I never imagined that one of our partners would betray us as Arman did. Today, we took steps to hold him accountable. Theodent is a strong, successful company, and our best days are still ahead of us.”
Dr. Nakamoto is credited for the truly revolutionary technological breakthrough that changed oral care. In the 1980s in New Orleans, Louisiana, Dr. Nakamoto’s discovered that though caffeine decreases enamel crystal size, theobromine causes an increase in enamel crystal size. This unexpected discovery unveiled an unknown property in cacao and revealed an ironic truth: a component of chocolate actually enhances enamel strength.
In 2007 Mr. Fuselier joined Dr. Nakamoto as two of the three founders of Theodent, an oral care company that would disrupt an industry starving for innovation. Since its launch in 2012, Theodent has grown its distribution in the United States, Canada, United Kingdom, Russia, the Czech Republic, Hong Kong, China, United Arab Emirates, Iraq, South Africa, and other countries. Mr. Fuselier now ably leads Theodent as its top executive.
Peiffer Wolf Carr Kane & Conway, LLP is a national law firm with offices in New Orleans, St. Louis, Cleveland, Youngstown, Austin, New York, San Francisco, and Los Angeles.
EDITOR’S NOTE: A video of this Peiffer Wolf news event will be available on this page.
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