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Melissa Allison follows the world's biggest coffee-shop chain and other Seattle caffeine purveyors.

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March 4, 2009 4:14 PM

Top Pot Doughnuts investor sues co-founders over her diminished share of the growing empire

Posted by Melissa Allison


Jan Johnson at the Panama Hotel she owns in the International District.

Back in the early 2000s, when Top Pot Doughnuts emerged as a lone coffee-and-doughnut shop on Capitol Hill, Jan Johnson says she invested $99,000 in the venture and bought the store a $2,500 commercial mixer.

When Top Pot opened a shop in downtown Seattle, Johnson says she lent the co-founders $50,000.

Back then, she owned 25 percent of the company.

As Top Pot grew, Johnson -- who also owns the Panama Hotel in the International District -- thought she continued to own a quarter of what is now a five-store chain and a company that sells its doughnuts in more than 7,000 Starbucks stores in the U.S. and Canada.

According to a lawsuit Johnson filed Feb. 24 in King County Superior Court, her stake is far less than she was told.

She is suing Top Pot co-founders Mark and Michael Klebeck, who are brothers, and Joel Radin, along with five other people whose names and "capacities" she does not know, alleging that they fraudulently diluted her ownership.


Mark Klebeck, co-founder of Top Pot Doughnuts.

She wants back her $50,000 loan plus interest, and her legitimate share of the doughnut company, whatever that turns out to be.

Her attorney, John Du Wors, said Johnson has "never received a dime" from Top Pot, whose corporate name became Doughnut Corporation of America in a 2005 merger that included Zeitgeist Coffee. Johnson alleges that merger is part of the fraud.

Top Pot has not filed an answer to the complaint, but its attorney, Josh Brower, said, "Top Pot has always worked very hard to maintain positive relationships with its investors and Top Pot looks forward to resolving this lawsuit as soon as possible."

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