Echo Fox co-owner Rick Fox has filed a lawsuit alleging that two of his business partners at esports organisation Echo Fox have defrauded the business out of millions of dollars.
The former NBA basketball star was one of the high-profile owners of the Echo Fox team that purchased a spot in the North American League of Legends Championship Series (LCS) back in 2015. Although Echo Fox added teams in a number of other esports, it was their LCS team that brought them most attention.
Fox filed his suit in Los Angeles on Monday and his claims allege that Echo Fox partner Amit Razada had fraudulently used funds from investors for his personal use, which has in turn left Echo Fox on the brink of financial collapse.
Mr Fox also alleged that Raizada had written racist messages, which had promoted Riot Games, the organiser of the LCS, to order Echo Fox to sell their LCS slot within 60 days, or to have it sold for them and the proceeds handed in part back to Echo Fox.
Stratton Sclavos Also Named
Furthermore, the documents also show that Mr Fox has claimed another Echo Fox partner, Stratton Sclavos, the former owner of the San Jose Sharks, took a $2 million personal loan from Echo Fox after he helped to raise funds for the company from a group of businesses and investors.
Mr Fox had announced in April that he planned to leave the company over the racist messages that Raizada had sent to the former CEO of Echo Fox, Jace Hall and to members of Fox’s family. Fox subsequently changed his mind over leaving, but the racist messages promoted an investigation from Riot Games, which led to Echo Fox’s expulsion.
Sure enough, Echo Fox were removed from the LCS when their slot was sold to Evil Geniuses later in the year, purportedly for $33 million, with around $30.5 million of that paid to Echo Fox.
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Categorically False Allegations
However, in a swift move to rebut the allegations, Amit Razada’s attorney, David Swift, stated that:
“Rick Fox’s lawsuit is a transparent attempt to divert attention from the train wreck he left behind at Echo Fox.”
He further claimed that the suit “is littered with categorically false allegations” about Mr Raizada and other partners at Echo Fox.
In a further statement, Mr Sclavos attorney Linda McFee also rejected the claims made by Mr Fox in his suit.
“Rick Fox’s lawsuit is a senseless diatribe replete with false and wholly unsupported accusations about Stratton Sclavos and Amit Raizada,” she stated.
“Unfortunately, in the face of his impending removal as General Partner of Echo Fox for flagrant breaches of his duties to the company and its partners, this appears to be yet another attempt to deflect the blame for Echo Fox’s failure from himself.”
“Contrary to Fox’s propaganda, neither Sclavos nor Raizada misappropriated or misused any company funds.”
Despite the suit, Mr Fox has said that his experiences have “100% not tainted my love for esports” and he has every intention to “continue on in esports after this cleaned up.”
It is not yet clear what area of esports Rick Fox intends to move into when this suit is finally settled.