Jeweler, charity in legal fight over donation for fundraising event that now won't happen

October 1, 2012 9:11:27 PM PDT
A well-known Houston jeweler is taking a charity for kids with cancer to court. At issue is what the charity was doing with the money given by I W Marks.

I W Marks was so concerned their money wasn't going to go to kids with cancer that the store filed a lawsuit last Thursday -- three weeks before the big fundraising event was to happen. The charity says the lawsuit is baseless and that the claims in it are false.

For a business that's been around for 35 years, reputation is everything, and Brad Marks has a responsibility to his late father, the founder, to choose how he uses the I W Marks name.

So last year when the charity Rally for Kids with Cancer Foundation approached the store, it seemed like a good fit. I W Marks signed up and gave $150,000 to be the title sponsor for the October 19 racing-themed event. But now they're backing out.

"As the lead sponsor they're going to go ask others to be involved in this and if it's something that they are not comfortable doing, they don't want to put their name behind it," the jeweler's attorney, Paul Doyle, said.

The Bellaire jeweler is suing the charity as well as Solutions with Impact, the company that runs the event, claiming they were defrauded.

According to the lawsuit, all parties agreed that the funds raised would go to the Sunshine Kids and the Methodist Hospital. Instead, the store claims much of the money is dedicated to expenses, not helping kids with cancer, and in fact the charity and Solutions with Impact are one in the same. I W Marks wants the money back.

"If they intend for the money to end up with the kids for cancer they're going to give it back, so we can give it to Methodist and to Sunshine Kids," Doyle said.

In an email, Jack Cairl, the lawyer for the defendants tells Eyewitness News the net proceeds from donations should go to charity and that they plan to provide the funds to the Sunshine Kids. He acknowledges the charity and Solutions with Impact are related, says it's not improper and set up this way "to conduct activities for the charity and help defray the charity's costs." He says the two have "nothing to hide" and intend to "defend themselves vigorously" from this lawsuit.

But there's one thing the two agree on.

"The event is not going to happen," Doyle said.

We did take a look at the charity's IRS filings from last year with a CPA. He points out a couple of things: its contributions -- $285,000 worth -- are not itemized so we don't know where the money went. If you add up their expenses ($483,325) and compare that to how much they took in last year ($865,983), more than half (55 percent) went to overhead. The Better Business Bureau recommends that number be 35 percent or less.

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