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Fixer Upper's Chip and Joanna Gaines Get Ready for Ugly Fraud Lawsuit

Christina Marfice

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Christina is a reporter based in Boise, Idaho. She's a veteran vegetarian, a political junkie and a huge grammar snob. On the weekends, she can usually be found binging on Netflix, playing the piano or petting her cats, Daisy and Dandelion.

Chip and Joanna Gaines ethics are called into question with a fraud lawsuit

Poor HGTV is having a rough time with the scandals lately.

And for the fourth time in recent memory, Chip and Joanna Gaines, the hosts of Fixer Upper, are making headlines for reasons HGTV would probably prefer they didn't.

More: Before you condemn Chip and Joanna Gaines, wait for them to at least address these issues

The couple has been sued by their former business partners, John Lewis and Richard Clark, who claim they were misled by the Gaineses and manipulated into selling their part of the business just before Fixer Upper took off. They just spoke exclusively to In Touch Weekly about it.

"We have been attempting to resolve this matter privately for many months," Lewis told the site. "There were multiple communications between my attorney and Chip’s attorney and multiple attempts to get this resolved. I wouldn’t say that [Chip] absolutely ignored it, but we never got into a position where there was any realistic chance of resolving it without filing the lawsuit."

Just a few days after the lawsuit was filed, Chip Gaines claimed he had never been contacted about the dispute, tweeting, "I’ve had the same cell number for 15 years. Same e-mail for 20 years. No one called or emailed? Four years later ‘friends’ reach out via lawsuit — hum."

More: Chip Gaines Challenges Allegations He's Against Same-Sex Marriage

But Lewis says his lawyer emailed Chip about the lawsuit months before it was filed.

In their claim, Lewis and Richards say they were 66 percent owners of Magnolia Realty before they were convinced by Chip to sell their share for just $5,000 in 2013. Days before the sale, Chip signed on with HGTV to air Fixer Upper, which caused the business' value to skyrocket.

"The bottom line is we owned a business together. We had been friends for over a decade. The choice could have been when he had the knowledge that there was a success on the horizon that he could have allowed his friend and business partner to enjoy that future success with him, and he chose not to do so," Lewis said. "I knew they were filming a pilot. I had no idea that it was going to be aired on any network, let alone HGTV, and didn’t know about that until two days after we signed over the company to Chip. I trusted what Chip was telling me — the business we owned together had no value."

More: The 10 Biggest HGTV Scandals in Recent History

He added, "I’m very happy for their success. The only thing I’m unhappy about is being tricked into selling my portion of the company."

Chip's lawyer, Jordan Mayfield, responded to the claims, saying, "We are confident that these claims will be found to be meritless. It is disappointing to see people try to take advantage of the hard work and success of Chip and Joanna."

Hopefully, for HGTV's sake and reputation, this doesn't end up needing to be settled in court.

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