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September 10, 2010 GAY PEOPLE'S CHRONICLE
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Synergy
Continued from page 2
McCall was on Synergy's board of directors until her resignation on July 6. She is the Cleveland official most tied to the Games, and as such, had conflicting loyalties.
The counts against McCall in the complaint appear to be about her performance as a Synergy director, more than as a city official. McCall, also an attorney, was clearly trying to represent both sides of the conflict
for a while.
"Despite the fact that Valarie McCall was a member of the Synergy board of directors, she did not return Synergy's calls or e-mail requests," Synergy says.
"Valarie McCall's failure to advise Synergy of the details of the requested 'project report' and failure to even return phone calls on this subject breached a fiduciary duty which she and the city of Cleveland owed to Synergy."
Though she denies it, McCall is apparently responsible for orchestrating the secrecy around events in early July, as word was getting out that something was wrong. She is speaking to press now.
McCall received the Gay Games flag in Cologne on behalf of the city.
"McCall, acting in her official capacity as an employee of the City of Cleveland and as a member of the Board, clandestinely negotiated with FGG to breach the License Agreement, and further conspired to replace Synergy with another, yet to be created organization," the complaint alleges.
Which Synergy?
As early as March, federation officials began asking questions about Synergy's
structure.
While "Synergy" most often means the not-for-profit Cleveland Synergy Foundation, the former licensee of the Games, there
is another "Synergy." A for-profit, limited liability corporation was set up the same day as the non-profit, called Cleveland Synergy LLC.
Tavolier is the statutory agent of both. W. Doug Anderson is an incorporator of both. His partner, Jeff Axberg, is an incorporator of the Synergy Foundation only.
Such arrangements are common with hospitals to raise money for charity care, but with Anderson, Axberg and Tavolier running both entities, it is difficult to tell where one starts and the other stops.
As a limited liability corporation, the forprofit Cleveland Synergy is not transparent. A third company also appeared on Synergy's SynergyFest website called Synergy Travel, which uses the Synergy Foundation's logo.
The website's copyrights were owned by Synergy LLC in March, though the tag has been removed since.
It's not clear what the relationship between the companies is, but it is clear from the documents that federation officials began to ask questions about it, sometimes to Cleveland officials.
More concern started when financial statements were submitted showing loans between the Synergy LLC and the Synergy Foundation.
Synergy Foundation, in March, received $122,500 from Synergy LLC, which were then booked as foundation liabilities.
Only the Synergy Foundation had access to the city money and the line of credit from the Federation of Gay Games.
Still, in June, Synergy Foundation booked $31,165.42 net losses.
Cleveland attorney Richard Haber represents Synergy.
The city is not answering questions about the group that is being formed to get the new Gay Games license.
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