The state of North Dakota is suing a Bismarck photography studio that abruptly shut down, refused to offer refunds to clients who had already paid for services, and prompted hundreds of customers to file complaints with the attorney general’s office totaling more than $1.4 million.
The lawsuit filed Tuesday in state court by the attorney general against Glasser Images paints a picture of a company that faced money woes for years before the coronavirus pandemic. Owner Jack Glasser blamed the pandemic for the business’s closure in October 2021. Court documents allege that Glasser and his partner and employee Jace Schacher spent hundreds of thousands of dollars of the company’s money on personal expenses while seeking loans to keep the studio afloat.
“Our complaint alleges that Glasser Images had been experiencing serious financial problems for years but falsely blamed the business closure on the pandemic,” Attorney General Drew Wrigley said in a statement. “Despite the business’s serious undercapitalization, Jack Glasser continued to borrow from banks, the government, friends and family, while simultaneously enjoying a lifestyle of high-end dining, travel, and luxury vehicles, all at the expense of his business customers.”
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The state seeks a court ruling that defendants Glasser Images, Jack Glasser and Schacher violated the state’s consumer fraud law. It asks the court to bar them from providing future photography services and to require that they provide restitution for consumers and for contractors who took photos for the company. It also seeks an unspecified financial penalty.
It’s possible that customers might see little to no money even if the court rules in the state’s favor.
“Given Glasser’s financial situation, I think actual consumer restitution is going to be very difficult,” said Parrell Grossman, director of the attorney general’s consumer protection and antitrust division.
A lawyer for Glasser Images, Tim O’Keeffe, said the attorney general's office "chose to grab some cheap headlines" by filing the lawsuit before sharing it with Jack Glasser.
"The AG's office has asserted their own opinions into the complaint, which is full of speculation and puffery," he said. "We maintain that this is a failed business and not an elaborate conspiracy."
O'Keeffe added that Jack Glasser "has been devastated by the closing of Glasser Images and the negative impact it has taken on his clients, employees, subcontractors and the community."
The company is working with a vendor, ShootProof, to return to customers images that had already been shot at the time of its closure. Many of the photos were of weddings, though the company’s contractors photographed a variety of occasions.
ShootProof on Tuesday said that it hopes to finish most of the remaining work by early next week.
Grossman said ShootProof so far has returned photos to 137 families. Customers’ situations vary, and some are still waiting to receive photos and videos not handled by ShootProof. About half the complaints his office has received are from customers whose photos were taken, but they had not received any before the studio's closure. The other half are from people who paid for photography services in advance, but the company closed before any photos were taken, Grossman said.
Glasser Images has faced a host of other legal challenges related to its closure, including from clients seeking relief in small claims court, as well as from various businesses involved in its affairs.
Seeking loans
The attorney general’s office spent months investigating the photo studio’s closure. Lawyers for the state questioned Jack Glasser at a hearing, and they subpoenaed documents related to the business.
Their complaint details numerous times since 2017 when the company sought loans from the federal government, state government, banks, friends and family members.
The earliest loan mentioned stems from August 2017 when the company received $350,000 from the federal Small Business Administration. The complaint tallies more than $1.3 million in loans Jack Glasser secured through 2018. He acquired another $815,000 in loans the following year.
The complaint says he continued to seek loans in 2020, using the coronavirus pandemic as an excuse even though the business’s financial problems began years earlier. The company, meanwhile, refused to provide refunds to clients whose weddings were postponed due to the pandemic, according to the complaint.
“In a display of hypocrisy and entitlement, Jack and Glasser Images believed the government and their banks should give them money due to the pandemic while they simultaneously refused to provide a refund to clients who requested one,” the complaint reads.
Glasser Images ultimately secured more loans in 2020 and 2021, including several from the federal government, which established programs to help small businesses affected by the pandemic. The federal pandemic-related loans totaled hundreds of thousands of dollars, at least some of which was forgiven, the complaint alleges. Glasser in September 2021 requested a change to some of those loans, seeking another $1.5 million.
The Small Business Administration denied that request the following month on Oct. 4. Jack Glasser made a final attempt to secure a loan from the parents of a friend, but she declined, and he announced the company’s closure on Oct. 7, according to the complaint.
Jack Glasser “spent years funding Glasser Images utilizing every conceivable funding source,” the complaint reads.
“And the entire time, Glasser Images solicited advance payments from clients without disclosing its poor financial condition,” the document states.
A luxurious lifestyle
While seeking millions of dollars in loans, Jack Glasser and Schacher “used Glasser Images to live an extravagant life funded by the business,” the complaint alleges.
The document details a number of items paid for with company funds. The partners leased a 2021 Mercedes-Benz, costing the business $1,600 per month. They also leased a 2021 Audi for $2,000 per month, which was paid for using their personal checking account, with payments covered by funds transferred at least three times from Glasser Images’ account, according to authorities.
“In addition to the cars themselves, Jack and Jace used business funds to have their cars detailed as often as once a week,” the complaint alleges.
Company money also went toward personal travel, including to Hawaii in 2018, according to the complaint.
The two used company money to pay for frequent meals at Pirogue Grille in Bismarck, including a $400 meal for Jack Glasser’s birthday and 13 meals there over 31 days in mid-2020, the document says.
Company money also went toward mortgage payments, haircuts, plants, subscription services and other purchases, according to the complaint. The state alleges that the partners concealed the expenses by wrongfully recording them as legitimate “meals and entertainment” purchased by the business, as well as by categorizing them in accounting software as a loan given to Jack Glasser by the business.
Jack Glasser and Schacher had spent at least $499,000 of the company’s money on themselves by the end of 2020, according to the complaint.
“Jack and Jace’s conduct is consumer fraud because the business did not disclose to clients that their payments were being used by Jack and Jace to fund their extravagant lifestyle while the business remained undercapitalized,” the document reads.
Contractors
Glasser Images restructured in 2020, cutting its staff in half and choosing to rely on independent contractors to reduce the business’s expenses, according to the complaint.
The company, meanwhile, had been taking on more clients in the years since 2018. The business hired 150 contractors to photograph and record videos of weddings, as well as for editing, the complaint says.
The studio did not always provide clients with two photographers for weddings, as promised in contracts, and it sometimes failed to deliver high-quality photos, the state alleges.
When Glasser Images shut down, it left many contractors wondering what to do. Some had not been paid for services they had already performed. Others were unsure if they could legally distribute photos they had taken to Glasser’s clients.
Grossman said the attorney general’s office is trying to seek reimbursement for contractors, and it’s asking contractors to deliver any photos they have to Glasser’s customers, regardless of whether they were paid by Glasser. Those discussions are ongoing.
“We believe most either have or will do so, but we haven’t necessarily heard back from all consumers on whether that has occurred,” Grossman said.
If the attorney general’s office determines any contractors that are holding photos are unwilling to give them to Glasser’s customers, they could become defendants in the lawsuit, he said.
The company’s legal team has said that photographers are free to distribute images to customers.
Jack Glasser founded the photography studio in 2005. Its headquarters were in downtown Bismarck, and the company provided photography services to people throughout North Dakota and neighboring states.