A designer who has dressed Meghan Markle and Angelina Jolie faces an accusation that she ran her brand into the ground to finance a jet-set lifestyle which included lavishing cash on pets.
Administrators for Ralph & Russo, which became insolvent in March, told the High Court in London that Tamara Ralph, the Australian woman behind the company, “extracted substantial sums” after raising about £60 million in investment between 2018 and last year. They are suing Ralph for nearly £21 million.
It is alleged that Ralph, 39, and Michael Russo, 40, the co-founder, spent millions “on personal expenses” that had “no business justification” and simply funded their “lavish lifestyles”. Ralph has denied any wrongdoing and is defending against the claim.
Ralph & Russo designed the Duchess of Sussex’s £56,000 engagement dress and the business partners were romantically linked until late last year.
The claim brought by Begbies Traynor and Quantuma Advisory, the joint administrators, alleged that Ralph raised £60 million from investors, with a significant contribution by Candy Ventures, the company run by Nick Candy, an entrepreneur. Despite that funding, the administrators said in papers lodged with the High Court that Ralph & Russo became insolvent at the beginning of March. At the time, it was claimed that the business had less than £100,000 in the bank and owed £3 million to the taxman and £20 million to creditors.
According to the claim, “the cause of the company’s financial difficulties was the serious wrongdoing of the defendant”, which the administrators said “stripped” Ralph & Russo of cash reserves “partly for the purposes of enriching the defendant at the expense of the company and funding the defendant’s lavish lifestyle”.
Ralph is accused of frittering investors’ money on business-class flights, luxury hotels and yoga classes. The administrators also said she spent the money on “expenses related to her pets, utility bills . . . lingerie, a housekeeper and hair care”.
Russo is not a defendant in the legal claim but the administrators still accused him of spending money that was extracted from a “directors’ loan account” made to the business. The claim said Russo used the money for gambling and to rent property “for his girlfriends in Los Angeles and London”.
Ralph said in a statement that “the claims . . . are misconceived and demonstrably false”. She said she was “constrained in what I can say about these claims pending my formal response but, if they are not withdrawn, I look forward to responding to and defeating them through the proper legal channels”. The designer added that the past 18 months “have been the most difficult of my career and I believe the claims are the latest part of a concerted campaign to bully, silence and coerce me”.
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