The Comedy Store filed a lawsuit against its accounting firm, alleging that it missed receiving at least $8.5 million in COVID-19 relief funds due to “misrepresentation, gross negligence and misconduct.”
According to the lawsuit filed Tuesday in Los Angeles Superior Court, Seattle-based accountant Moss Adams with offices in Los Angeles misrepresented his “expertise and knowledge of” the federal COVID-related assistance program and failed to notify the Comedy Store of the request The application for the state grants ended in August 2021.
Moss Adams did not immediately respond to a request for comment.
The famed West Hollywood institution, which has helped launch the careers of countless comedians like Richard Pryor and Robin Williams, claims the loss of COVID relief money was “particularly damaging” as its business plummeted about 90% at the end of 2020 The pandemic halted live entertainment and forced businesses to close as people sheltered at home.
The tax-exempt government grants, part of $16 billion in emergency aid for performing arts companies, were “a critical element of the store’s efforts to recover from the economic hardship caused by the COVID-19 pandemic,” it said in the lawsuit.
After the Comedy Store was determined to be entitled to the funds, Harold Breslow, the store’s acting controller, along with Chief Executive Peter Shore, sought help in “navigating” the application process, according to the lawsuit.
Breslow contacted Moss Adams and was informed in July that the firm could help and introduced Breslow to Aparna Venkateswaran, an accountant at the firm who has been described as “our expert on all things SBA,” which means the Small Business Administration that oversees became the program.
The Comedy Store claims that the day after discussing his application with Venkateswaran, he attempted to submit his application “only to find the program closed and eligibility consequently terminated.”
“Moss Adams directly led Breslow and the store to rely on his expertise in the preparation and submission of his application and this obviously included ensuring the application was submitted while the program remained open and the grant available stayed,” the lawsuit alleges.
When the Comedy Store subsequently issued a warning letter to Moss Adams “regarding this gross negligence,” he was told that “his entire file relating to the engagement was lost,” according to the lawsuit.
https://www.latimes.com/entertainment-arts/business/story/2022-08-31/the-comedy-store-sues-accountant-it-claims-lost-it-8-5-million-in-covid-relief-funds The Comedy Store sues accountant over missed $8.5 million in COVID relief funds