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Tony Packo III, the executive vice president of Tony Packo’s Inc., and company Controller Cathleen Dooley were indicted Wednesday by a Lucas County grand jury on three counts each of aggravated theft.
RELATED CONTENT: Indictment of Tony Packo III, Cathleen Dooley
The two are each accused of stealing in excess of $100,000 from Tony Packo’s Inc. from January, 2006 through Feb. 28, 2010. The pair was indicted jointly, and prosecutors allege that they stole the money together.
If convicted, each would face a maximum of three years in prison. While they face three counts each, they are charged in the alternative, meaning both Mr. Packo and Ms. Dooley could only be convicted on one count.
The Packo family restaurant is in the process of being sold and a court hearing Thursday was to decide on finalizing the sale to Bob Bennett, who owns the area Burger King restaurants. Under the deal, he would receive the Tony Packo’s name, recipes, and even the famous signed hot dog buns that are displayed throughout the chain’s locations.
The agreement between Skutch Co. Ltd., the court-appointed receiver of Tony Packo’s Inc., and Mr. Bennett’s TP Foods LLC spells out the details of the sale that, if approved, would transfer the iconic chain’s ownership away from the Packo family.
Mr. Bennett, owner of Bennett Management Co., previously told the Blade that Tony Packo, Jr., current president, and his son, Mr. Packo III, would run the five-restaurant operation, which is based in East Toledo.
Mr. Bennett’s $5.5 million offer to buy the Tony Packo’s business was selected as the “best and highest” by Judge Gene Zmuda. The sale agreement is necessary for the transaction to be completed.
There has been a longstanding feud between Robin Horvath, who owns half of the Tony Packo’s business, and his cousin, Mr. Packo III, and Ms. Dooley. Mr. Horvath, the company's chief operating officer, accused Mr. Packo III and Ms. Dooley in a in July, 2010 lawsuit of misappropriating company money. Mr. Horvath turned over company records he had to the county prosecutor’s office to investigate. He contended that more than $100,000 was allegedly misspent and that up to $300,000 he could not determine whether it was properly spent because he was denied access to company records.
John Weglian with the Lucas County prosecutor’s office said the indictments stemmed from a year-long investigation by his office
The legal dispute led to the sale of the company to Mr. Bennett. Mr. Horvath has contended in court proceedings that it was difficult to submit a valid bid for the firm until he received answers on his allegations, including the alleged misspending.