Former Gillett mayor charged with theft in a business setting

Beaton is accused of misappropriating funeral home funds
Warren Bluhm
Oconto County Times Herald Editor

OCONTO — Former Gillett Mayor James Beaton was being disingenuous when he said he was blindsided by the sale of Legacy Funeral Chapels, where he had served as funeral director for nearly three years.

Documents filed in Marinette and Oconto courts last week indicate the sale was the culmination of an ongoing dispute with the business’s former owners, which has now led to criminal charges.

Beaton is charged in Oconto County Circuit Court with 13 counts of theft in a business setting. He was arrested Thursday in Appleton, where he has been living since September, and spent most of the weekend in the Outagamie County Jail.

The former mayor filed suit in late December against Russell and Karen Walker, of Marinette, who sold the funeral home Sept. 6. According to the lawsuit, the new owner informed Beaton on Sept. 9 that he was terminated, effective the following day, and needed to vacate the apartment attached to the business.

The suit alleges that the Walkers breached three agreements signed when Beaton was hired in October 2016. The court documents also allege wrongful eviction in addition to other claims related to their business relationship and the sale.

The agreements signed when Beaton was hired, which he attached to the lawsuit, indicate that after one year he would start to accrue stock starting at 20%, until he reached the point where he owned 49%, and that after 10 years he would have the option to buy the company’s funeral homes in Gillett and Green Bay along with the rest of the stock.

In a response filed Thursday, the Walkers say that Beaton began discussions in early 2019 to renegotiate the agreements, and at that time they made a counter offer to sell the company and property “at a significantly reduced price.”

Beaton answered in an email that read in part, “I do not accept your counter offer and I withdraw my offer. … There is not a future here for me.” Later that day he sent a second email tendering his resignation, effective April 1, 2019.

“By virtue of that email he exercised his right to terminate the employment and purchase agreements,” the response said. Further, the Walkers included a brief document Beaton apparently signed in August acknowledging that he and the Walkers no longer had any agreements in place.

Despite the resignation emails, Beaton continued working at the funeral home “as an at-will employee” while the two sides continued discussions over a possible sale.

Those were the conditions in early September when the Walkers found another buyer, who has restored Legacy’s former name of Kuehl Funeral Home. They argued that Beaton has no claim to wrongful eviction against the Walkers because it was the new owner who terminated Beaton and told him to leave the apartment.

The response lists a number of counter claims, including that Beaton misappropriated funds by writing checks to himself and to “cash,” took out a convenience store line of credit and used credit cards from the store for personal use, and sold a hearse that belonged to the business without authorization, depositing the funds in a personal account.

The Walkers estimate in their response to the civil suit that Beaton wrote himself paychecks in a total gross amount of $192,891 since October 2016. Even if the employment agreement had been in effect the entire time, he would have been entitled to only $157,500, they said.

Further details are spelled out in the criminal complaint, which says Oconto County officials were notified in September that Beaton had been embezzling from the company.

According to the criminal complaint, an accountant for the former owner broke down the amount of money Beaton allegedly misappropriated into 11 separate time frames ranging from two to five months each, totalling $132,227.48.

After the sale took place in September, then-mayor Beaton posted on social media that residents would be hearing “rumors” about him and categorically denied any wrongdoing on his part.

The City Council negotiated a “release and separation agreement” in a secretive process that was not made public until after it was approved, in which Beaton received a lump-sum payment representing his salary for the rest of his term through April ($2,762.50) in exchange for his resignation as mayor.

He had made himself a name in the small city, becoming president of the Gillett Business Association and waging a successful write-in campaign for mayor in April 2018.

Judge Michael T. Judge issued a bench warrant Friday seeking to have Beaton brought to Oconto to face the criminal charges. As of Sunday morning he was still in the Outagamie County Jail awaiting transfer.