Former partners in Chip Gaines‘ Magnolia Real Estate Company are suing the Fixer Upper star and others for more than $1 million, claiming that Gaines bought them out without telling them that he had made a deal with HGTV, PEOPLE confirms.
In the lawsuit filed Wednesday in Waco, Texas, John L. Lewis and Richard L. Clark claim that Gaines, 42, urged them to sell their equal shares while hiding news that HGTV planned to broadcast Fixer Upper and feature the Magnolia brand name, according to the lawsuit obtained by PEOPLE.
“We are confident that these claims will be found to be meritless, and it is disappointing to see people try to take advantage of the hard work and success of Chip and Joanna Gaines,” Gaines’ attorney, Jordan Mayfield, tells PEOPLE.
Gaines posted on Twitter after news of the lawsuit broke on Wednesday, writing, “The light shines in the darkness, and the darkness has not overcome it,” The message is a bible verse: John 1:5.
Lewis and Clark founded the company with Gaines in 2007 and the business largely operated out of Waco with a single real estate agent, according to the suit. Now, the Magnolia firm employs “over 93 real estate agents” and operates in nearly every major city in Texas, the suit alleges.
The men claim in the suit that Gaines bought their shares of the real estate company for $2,500 each with “insider information in hand” — Gaines allegedly described the company as “less than worthless.”
“Chip Gaines convinced plaintiffs to sell their membership interests in Magnolia Realty quickly to him before a public announcement that Fixer Upper was picked up by HGTV,” the suit states.
Gaines allegedly bought Lewis and Clark’s shares officially on May 6, 2013, according to the documents published by KARE. Two days later, Gaines publicly announced that Fixer Upper had been picked up by HGTV.
Along with Gaines, the suit names Magnolia Realty, Scripps Networks Interactive (the company that owns HGTV) and High Noon Productions, which produces Fixer Upper.
In a statement to PEOPLE HGTV officials said: “We respect the privacy of our show hosts and will not comment on matters related to their personal lives or businesses.”
The suit was filed just days after Gaines’ wife, Joanna, addressed rumors that she is leaving the hit HGTV show to get into the cosmetics industry.
“You can’t believe everything you read,” Joanna wrote in a note posted on her blog At Home. “No! I am not getting into the business of facial creams. And no worries, believing some of these stories happens to the best of us.”
- REPORTING by MEGAN STEIN