Message to the Karma Community

Dear Karma Community:

As a valued Karma Community member, I urge you to please take the time to read this factual account of what has happened to Karma, LLC. I am writing today to share positive news and to fill you in on what to expect from Karma, LLC moving forward.

As many of you may know, I am co-founder and majority owner of Karma, LLC, the business located at 1500 Riderwood Drive in Lutherville-Timonium. This past Thanksgiving holiday, false statements were spread through our greater community and on social media that a major theft occurred at our premises. This is simply untrue.

In summary, much earlier this year it became evident that there were numerous operating deficiencies, financial irregularities and missed reporting requirements that, as an experienced executive, caused me serious concern. While we attempted to satisfy our concerns numerous times by seeking routine financial and business information from the Karma, LLC co-owner, the attempts to obtain these important records were never successful.

We then began to probe deeper and discovered that the co-owner of the company had violated our legal agreement by creating a new business entity called Karma-Lutherville, LLC, which she was using to conduct business through out of our existing Riderwood location, action which violated Karma’s lease. This endangered the business, the property rights of the consignors and my financial investment. From the outside looking in, you would never have known the difference, but in terms of finances, money was being diverted to a different entity – not the Karma, LLC concept we created together. Suddenly and without warning, I was shut out from all access to financial records, social media accounts, consignor information and other important records needed to responsibly run the business. Worse still, all funds of the business were withdrawn by the minority owner. In effect, I was removed from my own business by a trusted partner who had commandeered the store and all of its assets.

Our immediate concern was Karma, LLC’s consignors, extended customer base, vendors and the greater community. We knew that legally rectifying this situation would take time, and as such the immediate goal was to make sure no one else got hurt. After numerous failed attempts to solve this with the co-owner, this past June we engaged legal counsel and the court system, and enacted a plan to ensure everyone’s property was protected and that the business partners at Karma, LLC would be held accountable to each other.

We continued our attempts to communicate in hopes of resolving this matter personally with the co-owner and her attorneys; they were unresponsive and she continued operating the competing entity. Finally, this month and under the strong advice of legal counsel, the decision was made to ensure all assets would be accounted for by taking possession of Karma, LLC’s entire store contents so these items could be inventoried and safeguarded. This was done under the direct supervision of attorneys, business advisors, professional security, a locksmith and supporting videographers so there would be personal accountability for this drastic step that had to be taken. We then made sure the consignment inventory was carefully stored in a temperature-controlled environment so it would be protected until rightful return. To be clear, this action was NOT theft, but the legal and rightful securing of company assets so each person that depended on Karma, LLC could be made whole. Furthermore, once we learned we had the legal right to take this important step, we felt an immediate sense of obligation to do so to preserve company assets and protect our consumers and consignors.

In court this week, the outcome we desired since June was realized. I, as co-owner, was legally restored to my rightful position at Karma, LLC. Amazingly, with the stroke of her pen, the judge acknowledged the rights of Karma, LLC thereby denying any rights to Karma-Lutherville, LLC and granted me the full access needed to ensure no further mismanagement or diversion of assets would occur at Karma, LLC.

We recognize this is a lot of information to digest and even shocking in some respects. However, it is important to remember that with the positive decision of the court:

1. All assets of Karma, LLC that were illegally taken by Karma-Lutherville in June 2018, including all inventory and consignment items, funds, privileges, social media and financial reporting systems, were returned to their rightful owner.
2. My ability to review any of the business’ information was stopped by the co-owner in early June 2018; my rights as owner are now reestablished by the court.
3. The rights of Karma, LLC were reestablished by entirely removing Karma-Lutherville, LLC from premises.
4. The court ordered the co-owner to lawfully and responsibly return all property to the consignors and to reconcile accounts.

Thank you so very much for your past patronage, understanding and patience during this challenging time.

Sincerely,

Maria Martinez
Co-Founder
Karma, LLC