A Seattle CEO who made headlines by setting a $70,000 annual minimum wage for all of his employees is being taken to court by his older brother, the co-founder of Gravity Payments, The Seattle Times has reported.
Lucas Price accuses Dan Price of violating his rights as minority shareholder and of breaching duties and contracts.
The complaints were initially signed March 13 and filed April 24, 11 days after Dan Price announced the pay raises for the 120 employees of Gravity. He attracted national publicity by announcing that he planned over the next three years to raise the salary of even the lowest-paid clerk. He said he would cut his pay from about $1 million to $70,000 and use company profits to fund the wage bumps.
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Attorney Greg Hollon, who represents Lucas Price, says the lawsuit is in response to a series of events over years, not just the wage announcement.
The brothers co-founded the merchant-services company Price & Price in 2004, and Dan Price became CEO in 2006. He told the Statesman in December that Lucas, a senior vice president at Zipwhip, remains a board member and shareholder of Gravity.
According to court documents cited by The Seattle Times, the brothers restructured their company into Gravity in 2008 amid disagreements.
The company processed about $6.5 billion in transactions for more than 12,000 businesses last year.
During restructuring, Lucas agreed to a minority interest and a reduced role, which let Dan continue as CEO, according to documents. The brothers entered into several contracts, which limited Dan’s compensation and protected Lucas’ shareholder rights, records show.
Lucas Price claims that his brother excessively paid himself and deprived Lucas of his shareholder benefits.
In a separate filing, Dan Price denied all complaints brought against him and said Lucas Price did not raise any concerns about executive compensation or his ownership benefits.
“I know the decision to pay everyone a living wage is controversial,” said Dan Price during a phone interview with the Seattle Times. “I deeply regret the rift this has caused in my relationship with my brother, who I love, and I’m hoping and praying for a quick resolution that’s positive for everybody.”
A trial date is set for May 3.