During the Modell’s Sporting Goods episode of “Undercover Boss,” the company’s CEO, Mitchell Modell, was revealed to be a multi-millionaire. He also has a wife and kids. He has a net worth of $20 million and controls half of the Modell’s empire. However, he allegedly spent company funds on lavish luxuries.
During the show, Modell’s Sporting Goods was forced to close a number of stores, including 107 in New Jersey, because they were unable to meet debt obligations. The chain has been owned by the Modell family since 1889. After Modell’s great-grandfather Morris Modell founded the business, Modell’s father William D. Modell was the first person to run it. William’s son, Mitchell, and his brother, Michael, took over the company and grew it to 140 stores. Michael Modell died of Crohn’s disease in 2001. He left Abby and their children 50 percent of the company.
Modell’s Sporting Goods has been featured on a number of television shows, including “Undercover Boss.” Modell’s company also sponsors several professional sports teams, including the New York Mets and Boston Celtics. The company was also a sponsor of the Baltimore Ravens during the Super Bowl run in 2012.
Modell’s Sporting Goods filed for bankruptcy protection on Wednesday. The company’s web site is still not accepting orders online. Modell’s is citing millions in unpaid debts. It also announced plans to sell some of its equity in the company. The company cites the loss of sports apparel sales as a reason for its financial problems. Modell’s has closed more than 15 percent of its stores in the past year. It has filed for bankruptcy protection a number of times in the past, including in 2012.
Modell’s is being sued by Abby Modell, who claims that her brother used Modell’s as a piggy bank. Abby claims that her brother spent millions of company funds on personal luxuries, including a fishing trip to Ontario, Canada, a $116,000 dinner at a popular Chicago steakhouse, and three trips to Disney World. In addition, Modell allegedly spent money on massages, a trip to Puerto Rico, and masseuses at Midtown’s Friars Club.
Abby Modell has filed a lawsuit against Modell’s, accusing the CEO of stealing millions of dollars from the company. Mitchell has denied the claims. Abby claims that he spent company funds on luxuries, including $7 million on personal expenses. The Internal Revenue Service has disallowed some of these expenses. However, there are still hundreds of thousands that Abby claims Mitchell spent.
The lawsuit cites several other instances of alleged fraud, including the purchase of a $700,000 car, a $180,000 Thurman Munson trophy, and three trips to Disney World. It also claims that Mitchell has approved no-show jobs for family members, including his daughter and son, and six-figure salaries for them.
Abby Modell is not the only person who is angry with Mitchell. Modell’s sister-in-law, Abby, has also filed a lawsuit against Modell’s, claiming that she was denied $34 million in payments from the company since Michael Modell died. Abby has a $480,000 salary and a full-time assistant paid for by the company. She also claims that Mitchell’s company is a “piggy bank.”