Kogan releases US legal eagle in his hunt for $1.5m in merchandise

Ruslan Kogan’s online company has engaged US legal representation. Picture: Julian Kingma

Australia’s biggest retailers just don’t send money to any supplier who comes knocking on their door offering goods for sale.

There are hoops to jump through, bona fides must be ­offered and checked, and there are credit checks too, not to mention the internet, which at the stroke of a few keys can tell you everything you need to know about a counterparts.

Even a basic LinkedIn search can unveil a clue into the people you are doing business with.

These most basic checks seemed to have not been done, not done properly or someone was fooled and has left online retailer Kogan.com, co-founded and run by Ruslan Kogan, ­potentially/allegedly fleeced of almost $US1m ($1.5m).

Now that will be the base of a messy court case between Kogan.com and a mysterious businessman working from a flat in the Crown Heights section of Brooklyn, New York.

The bizarre business arrangement began in February 2019, when Kogan.com agreed to a supply deal with a company called NBG Trade, which is based in one of Manhattan’s most prestigious office towers. No, just joking, NBG actually has its principal place of business in an apartment in what could politely be called an “up and coming” part of Brooklyn.

NBG Trade was co-founded and run by Dov Zaetz, but more about him later.

According to court documents lodged with the Eastern District of New York, between February 2021 and January 2022, Kogan.com placed five orders for merchandise with NBG, paying deposits on each order and totalling $US911,834.

What exactly NBG sold is not entirely clear, and its LinkedIn page – NBG doesn’t seem to have a website – talks a lot about luxury fashion and apparel with links to pictures of expensive, chunky watches.

Kogan.com chief executive Ruslan Kogan. Picture: Britta Campion

When the goods didn’t arrive, that’s when Kogan.com decided to pick up the phone, and write, to see where its goods were. Kogan.com even resorted to sending WhatsApp messages to get a hold of its supplier.

“NBG never fulfilled the ­orders,” court documents say. “To date, Kogan has not received a single item of merchandise from NBG as part of any of the orders. Kogan consistently ­attempted to contact individuals at NBG regarding the orders through email, WhatsApp messages and phone calls. NBG either failed to respond entirely, or failed to provide updates on the status of the orders.”

In fact the last Kogan.com heard from its Brooklyn supplier was just before thanksgiving.

“On November 14, 2022, counsel for Kogan sent a letter to Zaetz, NBG’s co-founder and Kogan’s primary NBG contact, requesting a refund of the deposits. Counsel for NBG contacted Kogan’s counsel regarding the letter on November 18, indicating he was investigating the matter and would reconnect after thanksgiving.”

Maybe NBG was just closed for the holidays, and all would be sorted. Not so.

Back to the court documents – “Kogan has not received any further communication from NBG or NBG’s counsel.”

Zaetz has a very thin LinkedIn profile with not much going on and his co-founder of NBG is simply listed as “Jeffery S.” To his credit, Jeffery S has got a few endorsements on his similarly skinny LinkedIn profile.

In Zaetz’s LinkedIn page his NBG business was described as a “wholesale distributor of brand name goods” since 2018 and in 2017 it was called a “luxury trader”.

Kogan.com has on the case lawyer Shawn Brenhouse, whose specialties include debt collection and entertainment law.

Interestingly, the New York lawyer recently represented The Catholic University of America, which was fighting an injunction that was stopping it selling the famous gingham farm dress worn by Judy Garland in The Wizard of Oz.

The Kogan.com versus NBG case is continuing.

Hits and memories

Private equity has been called a lot of bad names over the years; parasites, vultures, used-share salesmen – but mafia hit men?

Across the ditch in New Zealand a war of tough words has broken out between sacked staff of a local radio station, Today FM, and its private equity shareholder Quadrant, which many at the radio outfit blame for shock mass sackings and a sudden shutdown of the radio station.

Today FM was closed suddenly by its owner, MediaWorks, which is 40 per cent-owned by Quadrant, leaving shocked staff to vent their anger live on air, including plenty of swearing before the microphones were turned off.

Later, former Today FM presenter Rachel Smalley took to the newspapers with a commentary in which she branded the Australian private equity owners who shut the station down and sacked the staff as “hit men”.

Smalley wrote that the “sharpshooting Australians” took an “aggressive approach” and played an integral part in Today FM’s demise.

Quadrant gained its 40 per cent interest in the business through the acquisition of out-of-home advertising company QMS in 2018 for $571.6m. MediaWorks boss Cam Wallace stepped down in February – jumping ship to Qantas – and his departure might have triggered the Today FM closure.

Comparing private equity to mafia hit men could be a bit unfair. The mafia would understandably feel defamed by the association.

Race for new boss

Former trucking boss, billionaire and Australian Grand Prix Corporation chairman Paul Little was in high octane spirits over the weekend after a huge F1 Grand Prix race in Melbourne and almost half a million very happy onlookers.

AFL chairman Richard Goyder.

Now Little turns to the serious job of finding a replacement for outgoing Grand Prix boss Andrew Westacott, who has run his last race.

Little was heard telling people at the event on Sunday that he had hired firm Egon Zehnder to find a replacement, with lots of early interest and a short list to be ready soon.

Little hopes to approach the state government within a month or two with possible candidates.

That’s pretty quick. Meanwhile AFL chairman Richard Goyder is still apparently stuck in the interview process for the long, drawn out hunt for a replacement of departing AFL boss Gillon McLachlan.