Bank Sues Retailer to Retrieve $2.6 Million
After more than 20 yearsin business, Politix, the contemporary clothing store that sells men’s and women’s apparelat the Beverly Center in Los Angeles, is shutting its doors.
On June 28, a judgeappointed a receiver to liquidate the store’s merchandise to help pay off the$2.6 million still remaining on loans extended by Saehan Bank, said thebank’s attorney, Steven Spector of law firm BuchalterNemer.
In a lawsuit filed inLos Angeles County Superior Court on June 26, Saehan Bank sued Politix’s parentcompany, Moba Inc., based in Van Nuys, Calif., and a sister company, Vitamec USA Inc., which distributesvitamins, to retrieve the debt, which has been accumulating since the firstloan was issued four years ago.
In court documents,Moba and its sister company noted they were no longer able to continue theirbusiness operations and pay the loans.
Viken K. Momdjian isthe president of Moba and chief executive of Vitamec. He also is the co-founderof Politix, the retail venture that in the early 1990s had as many as 15 storesin the United States.
The first bank loan,for $200,000, was made on Sept. 26, 2008. The second loan, for $150,000, wassigned on Aug. 28, 2009. Two more recent loans—one for $1.35 million and another for $1.2million—were issued as recently as 2011 and 2012, respectively. The loans weresecured with Politix and Vitamec merchandise.
It was Vitamec, thevitamin company, that was having financial difficulties, according to Spector.“The sister company suffered substantial losses, which in turn dragged down thePolitix store with it,” he said. “Apparently, the vitamin company sold asubstantial amount of goods to customers who didn’t pay.”
With the parentcompany in a financial bind, the lawsuit said, Politix failed to pay at leasttwo months’ rent for its only store at the Beverly Center. The lawsuit notedthat the high-end shopping mall has notified Politix of its intent to starteviction proceedings.
The Beverly Center’smanager, Jeff Brown, said the shopping center does not comment on leasingmatters. Politix’s attorney, Byron Moldo, did not return calls by press time.
Politix was founded byViken K. Momdjian and his brother, Asbed. Between 1986 and 1989, they opened 10European-influenced menswear stores in and around Los Angeles, catering to the25- to 49-year-old customer. By the early 1990s, they had 15 stores inCalifornia, Ohio, Oregon, Illinois and Colorado.
The parent company,Moba Inc., did everything from design the stores to manufacture the garments.The company no longer manufactures its own goods.
The brothers’ father fledArmenia in the 1920s. Viken Momdjian was born in Syria but lived in Lebanon,Cyprus, Egypt and Britain before arriving in the United States to start hislife in retail.—Deborah Belgum
