AriZona co-owner tells court about 'internal civil war' at work

A co-owner of AriZona Iced Tea took to the stand Wednesday to describe a hostile work environment that he said was created by his former business partner at the well-known Long Island beverage maker's headquarters, calling it an "internal civil war."

Domenick Vultaggio testified on the last day of a six-week court trial involving a long-running battle with John Ferolito over the value of their company. The nonjury trial follows more than six years of litigation between Ferolito and Vultaggio, who together launched AriZona in Brooklyn in 1992.

Nassau County Supreme Court Justice Timothy Driscoll is expected to decide as early as October how much Vultaggio and Woodbury-based Beverage Marketing USA Inc., which owns the AriZona brand, must pay to buy the 50 percent stake Ferolito and a family trust own, attorneys for both sides said.

"Rarely is the sequel better than the original . . . but in this case the sequel was far better," Driscoll said, referring to a previous trial in 2012. He said the case had testimony from more than 40 witnesses and reviews of more than 1,000 pages of witness statements. Each side had 50 hours to present its case.

Vultaggio testified that Ferolito hired a private investigator to look into some employees and Ferolito questioned employees about their personal compensation.

"I think they personally attacked some of the employees to make them feel intimidated and uncomfortable," Vultaggio said. He added, "I believe what John was trying to do was to upset me . . . and shake me to try to sell the wonderful company that we built."

But Ferolito's attorney, Nicholas Gravante, said that company employees who remained loyal to Ferolito were fired, demoted or had their bonuses taken away.

AriZona hired private investigation firm Stroz Friedberg to explore why checks were cut from the company in 2004 to 2006 to Rick Adonailo, former chief executive, Vultaggio said.

"They startled me," Adonailo testified Wednesday about being approached by the private investigators.

Ferolito and Vultaggio had agreed in 1998 to restrict outsiders from participating in a stock sale of the company unless they both allowed it. Ferolito turned to the courts in 2008, after Vultaggio resisted selling.

Vultaggio's lawyers, who assert that the companies are worth $426 million, have insisted that valuing the beverage maker, with about 1,000 employees, at too high a price could determine whether it remains in private hands, goes up for sale or files for bankruptcy. Ferolito's attorneys have cited previous purchase offers of as much as $4.5 billion from other companies.