Former employee sues Cafesjian for back pay

  • Article by: DAN BROWNING , Star Tribune
  • Updated: March 14, 2012 - 9:23 PM

John Waters Jr. claims his aging boss has grown paranoid and owes him $5 million.

Gerard Cafesjian is best known in Minnesota as an art aficionado and the primary benefactor who helped preserve the historic State Fair carousel that now bears his name in Como Park.

The longtime director of Cafesjian's family foundation says in a federal lawsuit that Cafesjian was also a tough boss who has become increasingly paranoid, miserly and vindictive as he has aged -- and who stiffed the employee out of more than $5 million in salary.

John Joseph Waters Jr., who started working for Cafesjian when he was an executive at West Publishing, also claims that Cafesjian has tried to damage his reputation and avoid paying back wages and benefits by making unfounded allegations that Waters siphoned away Cafesjian's personal funds.

Neither Waters, 55, of Eden Prairie, nor Cafesjian, 86, responded Wednesday to messages seeking comment. Cafesjian now lives in Naples, Fla.

Waters filed the 47-page lawsuit without the help of an attorney. The suit, filed Tuesday in St. Paul, says that in 1994 he went to work for Cafesjian, who at the time oversaw sales and marketing at West Publishing.

The suit says Cafesjian reaped about $300 million from his shares in West when Thomson Corp., now Thomson Reuters, bought the company in 1996. Waters said he then went to work for Cafesjian's "family office" to manage his personal, business and philanthropic affairs.

Waters said he deeply admired Cafesjian but that he could be a difficult and demanding boss.

"Cafesjian was extremely self-centered, exhibited what appeared to me to be narcissistic characteristics and regularly exhibited delusions of grandeur," Waters says in the suit. "Cafesjian also suffered intense paranoia and frequent, almost daily, outbursts of anger."

Waters said he grew tired of the abuse and quit in 2009, but continued doing odd tasks for Cafesjian until mid-2011.

Waters said he represented Cafesjian in business deals in Armenia and elsewhere around the world. He said he served as Cafesjian's point man on a project to build a museum about the Armenian genocide. The museum, in Washington, D.C., was stalled by litigation in 2008.

Waters said he learned in 2009 that Cafesjian had hired accountants and lawyers to go over the books of his various holdings. He said he learned that Cafesjian had made "outrageous and unfounded" allegations against him as well as other employees, but continued to rely on his services from until mid-2011.

The suit says that Rick Ostrum, a former FBI supervisor now working as a private investigator for Waypoint Inc., in White Bear Lake, told Waters in July that his firm had been hired to investigate allegations that Waters had diverted cash from Cafesjian's personal checking account.

In December, Waters said, he was contacted by the FBI and told it had opened an investigation.

Waters alleges that Cafesjian has tried to threaten and harass him by contacting the FBI, by terminating contracts with firms "deemed to be friendly to Waters," by claiming to have Waters' phone tapped and by threatening other Cafesjian employees and associates who were planning to attend Waters' wedding.

Waters also has requested a temporary restraining order barring Cafesjian from destroying documents and other data.

Dan Browning • 612-673-4493

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