ceo restoration hardware being investigated by board

[arnold rothstein]

the following is an email sent to sharon flanagan goldman sachs lawyer for the upcoming ipo of restoration hardware, along with documents showing gary friedman the 55 yr old ceo had a sexual relationship with a 26 yr old underling, the girl was hired with no experience at all, with a starting salary of 70k dollars a year, was then given a 10k dollar raise after 4 weeks or so on the job,directly by gary friedman, who started a sexual relationship either 2 weeks before or after the raise.
Sharon, I apologize for the random way the texts are presented, but it was the best I could do at the moment. Most of the texts are between Eva and me from June 20th-23rd (the day of the suicide attempt). All of the texts from the 23rd are from Eva while she is in the mental facility at Cedars Sinai Hospital.
I am sorry for the graphic language in some of the texts, but these are the real unedited texts. The reason for the emails before the 23rd is to show you the state of mind Eva was in leading up to the 23rd, Gary being a somewhat intelligent adult should know “the girl he loves” is in distress or in a fragile state of mind. The emails saying she has not been able to get out of bed and go to work for a week should set off warning signs.
If you read the texts, Eva is very cordial with me until I say that I am going to confront Gary. After I tell her I am going to speak with him, you can clearly see how afraid she is of him. She responds that if I tell Gary, she is going to kill herself in the mental hospital. I immediately called the hospital and notified them of this.
Eva saying it was a 2 week fling is not a true statement, if you go by the dates she mentioned it began, she is all over the place. She acknowledges that Gary was extremely upset and angry with her, and thats what led up to the phone call where Gary badgered and yelled at Eva to the point she was hysterically crying.
I witnessed 15 minutes of the call, and later when I spoke with Gary he said "I was mad and upset with Eva and was raising my voice because she did not show up for plans we had on a Saturday to be with my twins".

[arnold rothstein]

I am happy to take a polygraph test as to the call with Gary and all of the other things Eva said to me about Gary’s behavior and sexual advances. I will use any licensed polygraph expert your firm chooses, and am willing to do so under oath.

There are dozens more recordings and documents, this is just so you can have an idea of what Gary has done. I believe the investigation by Weil will show nothing illegal was done, since Eva is cooperating and saying it was consensual.

If Eva was in a happy consensual relationship with Gary, why was she reaching out to me all week totally distraught? Why did she feel a need to break plans with Gary and have me get her a private plane at 12am to bring her from San Francisco to Los Angeles so she would not have to be alone? Why would she be unable to get out of bed and go to work if she were in a happy consensual relationship?(see attached text messages)

If Goldman feels comfortable taking Gary Friedman on a road trip in front of hundreds of investors, praising his ethics, judgement, and professionalism, that would just feed into the current public perception: that Goldman Sachs is all about money and has no concern as to what is in the best interest for the public or investors.

I do not share that belief; I have no real opinion, I just know Goldman has some incredibly smart and talented people in their organization, and the negative opinions belong to the public and a great deal of the major media that I read/watch.

To be clear, this is not a case of an ex-boyfriend and his ex-girlfriend, this is about a very confused and vulnerable 26 year-old girl who slit her wrist and tried to commit suicide in my home, and Gary Friedman's actions were the catalyst. In fairness to Gary, Eva’s mental issues are by no means his fault, but he abused his power and has ruined her life.

Eva has resigned from Restoration Hardware and is dating Gary Friedman openly (my investigators have photographs, among other things). She has no money and no means of support except she is at the mercy of Gary.

The fact that she “voluntarily resigned” is ridiculous: she moved across the country and sold all of her possessions to take the “dream job” Gary promised her. Does Goldman and the board believe, under the circumstances, that Eva is in a position to make life decisions right now? I am curious - did money change hands? If it did, be assured we will find it no matter what it takes.

Was Eva given her own council? Has she seen a psychiatrist, and if so, has the determination been that she is in the best environment possible?

I can only hope Goldman Sachs does the right and ethical thing, and not merely use a legal loophole while determining if Gary Friedman is fit to be the CEO of a publicly traded company. Does Goldman believe that investors should be made aware of this incident prior to its IPO?

I would be glad to fill you in on more details if you have any interest.

Thank you for taking the time to review this.

[arnold rothstein]

below is a follow up to the board of restoration hardwares investigation, being conducted by weil gotshal, one of the most prestigious law firms in the country.
goldman sachs is fully aware of this matter. this email has been sent to 50 mid to upper level executives at restoration hardware along with sharon flanagan of the law firm sidley austin, which represents goldman sachs, the board of directors and their lawyers at wei gotshal also have all this information,plus quite a bit more.

here is a brief update on the gary friedman eva vaughan sexual relationship.

according to spokes people for gary and eva, the affair started on about feb 13th 2012, gary's spokes person also confirmed eva was given
a 10,000 dollar a year raise, directly by gary. gary's claim is eva vaughan was given a 10,000 dollar raise from 70,000 a year up to 80,000 a year, so she would be able to afford to live in san francisco, with it's high rents.

this raise was given to eva after she was working at restoration hardware for less tha 8 weeks, and it was given within 14 days of gary's affair with eva.
if there are any restoration hardware employee's earning under 80,000 dollars a year and living in san francisco, you should make an appointment with gary friedman so you can get the same fair and reasonable treatment, gary claims he gave eva. the story sounds ridiculous, hopefully the investigation by weil gotshal sees this in the same light as anyone with common sense would.

as most of you know eva "voluntarily" resigned from her position at restoration hardware. what you might not be aware of is that eva was represented by lawyers in her resignation, according to spokes people for eva and gary. eva has a fairly high price lawyer, she had little to no money, one must ask the question, where did eva get money for a high priced lawyer, why would someone who is voluntarily quitting their job, in need of a lawyer?

lastly, eva found a place to live, sharing a house with a restoration coworker and 2 other roommates, her rent is 1100 (give or take 75 dollars) dollars a month, which is about 150 dollars less than her rent was in NYC where her salary was 47,000 dollars a year.

if anyone would like to share any information regarding this affair, please feel free to contact me. if you would like to be removed from my mailing list, please send an email and you will be taken off immediately.

[Barry Gesser]

Bitter posts written by a bitter X. It's bad to see someone get played, but it happens. Trying to ruin other people lives after it happens is just sad.

Checking all of the records it seems as though Eva comes from a good amount of money. I am sure her family would help her out if she ever needed any.

Keep your head up everyone has been through rough relationships in the past.

[arnold rothstein]

Barry Gesser wrote:

Bitter posts written by a bitter X. It's bad to see someone get played, but it happens. Trying to ruin other people lives after it happens is just sad.
Checking all of the records it seems as though Eva comes from a good amount of money. I am sure her family would help her out if she ever needed any.
Keep your head up everyone has been through rough relationships in the past.

no guy did not get played, was told first hand he was still sleeping with her right until she got comitted to the mental hospital. guy showed me texts from this girl eva she was banging both guys during the entire time, i saw nude pics she sent to this guy dated march and may.

this guy didn't care who she was screwing, he just had a small problem with her trying to comity suicide in his house 15-20 min after getting off phone with gary friedman ceo of restoration hardware her bf/boss he was freaking out on her because he knew she was in la sleeping with her ex.

the girls mentally ill, it is sad, who knows if she is trapped by friedman or using him or what her agenda is. girls a pig she probably banging many other guys.

friedman wins he gets the girl who was banging another guy whole time they were together, girl mentally ill, tried kill herself has threatened it over half dozen times, hes gonna lose his job and he gets a mentally ill psycho cheater gf. he wins lucky guy

[EVA VAUGHAN]

WHY IS EVERYONE MAKING A BIG DEAL ABOUT THIS? I LIVED IN SF I WAS USING MY BOSS TO GET MORE MONEY,SO I SLEPT WITH HIM.
I HAD ANOTHER RICH GUY IN LA WAS SLEEPING WITH BECAUSE I RELLY LOVED HIM, THE GUY IN LA PUBLISHED TEXTS I SENT HIM TELLING HIM HE WAS BEST SEX EVER, HE WAS AND IS. THE CEO OF RESTORATION HARDWARE GARY FRIEDMAN KNOWS I WAS SCREWING MY OLD BF THE WHOLE TIME I WAS WITH HIM, HE IS OK WITH IT OBVIOUSLY,SINCE I LIVE WITH HIM AND OFF OF HIM.
FRIEDMAN IS AN UGLY 55 YR OLD HE WILL NEVER GET A 26YR OLD AS HOT AS ME HES SO IN LOVE WITH ME I CAN SCREW LA GUY WHENEVER I WANT.
MY FAMILY DOES NOT HAVE A LOT OF MONEY AT ALL, WHY DO YOU THINK I SCREW 2 GUYS SAME TIME.

[Barry Gesser]

Why would either guy want to be with this mentally ill girl you speak of? She definitely was banging and sending pictures to more than just the 2 of them.


It is a sad story though- should Friedman lose his job, no- he had sex with an employee probably not the first time. Kinda understandable that GF would be upset about finding out about one of the guys she is banging. So he flipped out, her actions are a result of his anger? She is an adult, she can make her own decision. I don't think she would jump off a bridge if you got angry and told her to... or would she?

Eva resigning is probably a good think. It sounds as though she will be able to get another job fairly easily by the connections she has probably made.

She was playing with both guys, and a few others that were side flings who knew it was a game. But one guy couldn't let go so he attempted everything to get her back.

As for the last post "Eva Vaughan" - Your father is a well known doctor from what i have read, so i dont think money is an issue.

Side note: why does my server say New York? I am at the Austin-B international airport.

Anyways i expect a good reply from "Arnold/Barry"

[restoration worker]

Any guy who would be involved with a girl like this sounds like a pathetic loser to me. Actually all of of you do. ITS TOXIC MOVE ON!

[arnold rothstein]

isn't this barry, responding to me arnold? barry let me try to understand what you are saying, you think that there was no harm done? so its ok eva attempted to commit suicide 20 min or so, after getting off the phone with her boss/boy friend who was berating her and had her hysterically crying and inconsolable.

everyone knows it is not ok for the ceo of a company to date and employee, consensual or not. google past cases of this happening and you will see in every case the ceo was fired or forced to resign. you can start by the most recent car, brian dunn of best buy was fired, for a consensual relationship with an employee, to take it 1 step further richard schulze the founder and largest share holder of best buy was fired, for not reporting the relationship while he had knowledge of it.

yes i am sure there are ceo's who date employees, i am all sure there are no ceo's who date employees and get caught, still have their job. so yes you can do anything as long as nothing goes wrong and you don't get caught.
google best buy founder fired for not reporting brian dunn relationship, forbes article explains why ceo's can not date employees, consensual or not.

the story is not just about a relationship, it is about the ceo of a company in the final stages of going public, starts a sexual relationship with an employee, he directly hired, started a sexual relationship with this unqualified employee who had no business getting this job, 16 work days of her starting work. then 10 days after that gary friedman personally gave this employee (eva vaughan) a 10k a year raise, with the excuse it was to help her defray the expensive costs of renting an apartment in sf.
how do you think the other 500 plus employees of restoration hardware in sf (a majority of which earn way less than 80k a year) feel, do you think that is good for moral, or shows good leadership skills by gary friedman?

do you think it's ok for the ceo of a company that is public to take company money (it is not gary's company he is a minority holder) and give it to his gf? how can you trust friedman to run the company and not steal? if he stole 10k to give his gf of 10 day, how can you feel safe he would not take substantially more company money and use it for himself personally.

do you get the trust problem now? do you understand that this kills office and company moral, and sends a message to the loyal employees who have never gotten a 10k dollar raise, that the only way to move up in restoration hardware, is to sleep with your boss?

forget vaughan, if she wants to sleep with a hundred guys and use them for whatever reason, that's her issue, it affects nobody but her in the end. the guys get what they want, they get to play with some girl use her and throw her away.

this is all about gary friedman being unfit to run restoration hardware because he basically stole (or if you want to be kind he misappropriated company funds) to enrich his lover.is this gary i'm speaking to? or barry? i'm confused.

read the forbes article best buy founder fired and read harry stonecipher boeing fired, 2 examples of dozens where ceo alway gets fired.

also your thoughts on eva attempting suicide 20 min after being berated by gary friedman on phone for one 30 min , hysterically crying.. this raises another problem and reason ceo does not date employees, who was eva being yelled at by on the phone, her boyfriend or her boss who controls her financially and career wise, pretty drastic try to kill yourself after fight with bf.

curious to see how you defend gary (unless your gary).

[arnold rothstein]

restoration worker wrote:

Any guy who would be involved with a girl like this sounds like a pathetic loser to me. Actually all of of you do. ITS TOXIC MOVE ON!

i agree, after finding out this girl sleeping with bunch of guys, any man would be pathetic to still be with her. you work at rest, last i heard eva vaughan is living with gary friedman, sounds like he is pathetic loser. supporting/living with girl who was screwing her old boyfriend every other week while he thinks she's his gf. friedman pathetic.

[arnold rothstein]

curious, if you really work at resto, are you and your co workers cool with eva getting a 10k a year raise from 70k to 80k after 5 weeks on the job, 10 days after started sleeping with gary friedman, friedman directly giving her the raise bypassing the normal channels and the reason he gives is because she couldn't find a place to live in sf on 70k a year, but she drives a brand new mercedes.

do you and all your co workers make 80k a year, is it not unfair she gets a raise after 5 weeks on the job, are any people in sf office insulted that gary says you can not find a place to live in sf making only 70k a year? that can not be good for moral. do you have to sleep with gary to get ahead at rest? does not sound fair or like good leadership by gary.

guys a tool, dates a girl who was screwing at least one guy whole time she is playing him for money, and he still lives with her and supports her.
what a tool, same as his pretentious letters he writes in the catalog, that everyone laughs at, quoting "sir mick jagger who he got to see at the grammys" and tries to look like ralph lauren, no wonder he needs to pay to get laid, so pathetic.

[Former Restoration Worker]

worked at restoration, left the company a while ago. I do agree with your moral and ethical argument, and i hope the board does do something to punish gf for his behavior in the work place. However, these posts read more like a jealous ex (who is still in love with the girl for some reason) and the current bf fighting an extremely personal battle with each other. If what you write, and what i read about the girl is true, she seems like a horrible person with severe emotional and mental problems, and this is giving her the unhealthy attention she probably longs for. gf is pathetic for still being with her, but whoever the ex is (not sure if its you or someone you know) also does not seem to be able to let go. Again, from an outside looking in, Its crazy to see two grown men act like this over a girl, who is clearly sick and not worth the time. Maybe its not about love, maybe its all ego, because who could really truly love a girl like this. I don't get it. Again it all seems toxic , unhealthy and pathetic.

[Former Resto Employee]

It's done!
Home-furnishings retailer Restoration Hardware Holdings Inc. unveiled reorganization plans that include the creation of a new company that will develop new lines of business such as apparel, accessories, footwear and jewelry.
Restoration Hardware's current Chairman and Co-Chief Executive Gary Friedman will serve as founder, chairman and CEO at the newly created company, Hierarchy. Mr. Friedman will control Hierarchy, with Restoration Hardware owning a minority stake. He will also remain the largest individual shareholder of Restoration Hardware and serve as a nondirector adviser to the board in his role as chairman emeritus.
Meanwhile, Restoration Hardware will maintain its existing home businesses. Co-CEO Carlos Alberini will become the company's sole CEO while J. Michael Chu, a managing partner at private equity firm Catterton Partners Corp., will become its new chairman.
"The new structure provides a creative and efficient way to develop new businesses," Mr. Chu said.
Mr. Friedman has served as Restoration Hardware's CEO since March 2001 and became chairman and co-CEO in June 2010, when Mr. Alberini joined the company.
The reorganization comes after media reports last month said the company could launch an initial public offering this summer.
Restoration Hardware focuses on high-end home furnishings and decorations sold online and though 87 retail shops and 10 outlet stores in the U.S. and Canada, according to its website. The company was acquired in 2008 by Catterton Partners in a $179 million buyout over a rival offer by Sears Holdings Corp.(SHLD). It launched an earlier IPO in 1998.
Write to Nathalie Tadena at [e-mail]

[arnold rothstein]

take it however you wan't, but clearly gary friedman has been fired from restoration hardware, is restorations board so stupid that they think that bs press release is fooling anyone?

hopefully restoration comes clean and gives the real reason gary friedman is gone. hopefully gary is humbled and eva as much of an opportunist as she is , gets mental help.

[Outsider]

Well those naked pictures that were brought up before were apparently released to multiple websites. Sad story all around

[Resto Girl]

I wonder if perhaps the Board is wondering about another one of Gary's former girlfriends, also an employee at Restoration Hardware and also much, much younger, who died under mysterious circumstances while out jogging one morning.

The guy is slime. It's about time.

[CitizenX]

yawn get a life people

[Dullard99]

Am I the only one who saw this twisted chicks fetishes for ball gag masks and turkey basters? That about explains it all.....PATHETIC

[EVA VAUGHAN]

justice was done. the press release is fiction. you will see gary friedman was forced to resign for "misappropriating company funds" he took money from the company and gave to his gf. who knows if he did this in the past, i have a feeling this has been done a lot by him, he only got caught this time.

its all about gary taking company money,

[Charlie W]

Arnold, very interested in all of this. Could you shoot me an email? [e-mail].

arnold rothstein wrote:

the following is an email sent to sharon flanagan goldman sachs lawyer for the upcoming ipo of restoration hardware, along with documents showing gary friedman the 55 yr old ceo had a sexual relationship with a 26 yr old underling, the girl was hired with no experience at all, with a starting salary of 70k dollars a year, was then given a 10k dollar raise after 4 weeks or so on the job,directly by gary friedman, who started a sexual relationship either 2 weeks before or after the raise.
Sharon, I apologize for the random way the texts are presented, but it was the best I could do at the moment. Most of the texts are between Eva and me from June 20th-23rd (the day of the suicide attempt). All of the texts from the 23rd are from Eva while she is in the mental facility at Cedars Sinai Hospital.
I am sorry for the graphic language in some of the texts, but these are the real unedited texts. The reason for the emails before the 23rd is to show you the state of mind Eva was in leading up to the 23rd, Gary being a somewhat intelligent adult should know “the girl he loves” is in distress or in a fragile state of mind. The emails saying she has not been able to get out of bed and go to work for a week should set off warning signs.
If you read the texts, Eva is very cordial with me until I say that I am going to confront Gary. After I tell her I am going to speak with him, you can clearly see how afraid she is of him. She responds that if I tell Gary, she is going to kill herself in the mental hospital. I immediately called the hospital and notified them of this.
Eva saying it was a 2 week fling is not a true statement, if you go by the dates she mentioned it began, she is all over the place. She acknowledges that Gary was extremely upset and angry with her, and thats what led up to the phone call where Gary badgered and yelled at Eva to the point she was hysterically crying.
I witnessed 15 minutes of the call, and later when I spoke with Gary he said "I was mad and upset with Eva and was raising my voice because she did not show up for plans we had on a Saturday to be with my twins".