CaaStle is facing another lawsuit from its former partner, which is accusing the ailing startup and its founder of engaging in a pattern of “lies, betrayal, and cover up.” In the complaint that it filed in a New York federal court late last month, P180 Inc. claims that CaaStle, its founder and former CEO Christine Hunsicker, and a group of former collaborators orchestrated an elaborate, years-long fraud and conspiracy that was aimed at defrauding it out of millions of dollars and that amounts to a wide-ranging racketeering scheme in violation of the federal RICO statute.
The seeds of the legal battle between P180 Inc., CaaStle, and Hunsicker date back to early 2024 when Brendan Hoffman – a seasoned industry executive who previously led companies like Vince and Wolverine Worldwide – launched P180. Inspired by a meeting with Hunsicker, then CEO and co-founder of the apparel rental platform CaaStle Inc., Hoffman envisioned a business that could help apparel retailers improve margins on discounted inventory through recurring shipments enabled by advanced e-commerce and logistics technology.
According to P180’s complaint, Hunsicker presented CaaStle as a thriving business, with a subscriber base in the hundreds of thousands, robust logistics, proprietary technology, and a reported $1.4 billion valuation. Based on these representations, P180 entered into a joint venture in which Hoffman would control 75% of the new company, while CaaStle took a 25 percent stake. Hunsicker was simultaneously courting outside investors with ambitious revenue projections of $793 million for 2024 and $1 billion for 2025, while claiming that CaaStle held “hundreds of millions” in cash reserves as of mid-2024.
By that point, the company had already raised approximately $530 million in venture capital funding, presenting itself as a disruptor poised to revolutionize the trillion-dollar fashion industry through its clothing rental technology.
The Alleged Fraud Unravels
As the partnership deepened, P180 alleges that Hunsicker and her collaborators concealed critical information about CaaStle’s true financial condition. Contrary to representations, CaaStle allegedly had only a fraction of the stated subscribers, negligible revenues, and had exhausted hundreds of millions in investor capital. The complaint alleges that financial records, subscriber data, and audit materials were fabricated to prop up the illusion of a successful enterprise.
The lawsuit, which mirrors much of the language in the complaint that P180 filed against CaaStle in a New York state court in April, names Hunsicker as the central figure in what it calls the “Hunsicker Enterprise,” allegedly assisted by longtime collaborators Jaswinder Pal Singh, George Goldenberg, Chirag Jain, and Scott Callon. According to P180, these individuals, all of whom are listed as defendants, coordinated false representations, committed repeated acts of wire and bank fraud, breached fiduciary duties, and engaged in a cover-up once the fraud began to unravel in late 2024.
By early 2025, CaaStle was on the brink of collapse. The company secured a $2.75 million bridge loan while its board weighed bankruptcy and liquidation. Hunsicker resigned on April 1, after the board accused her of misrepresenting CaaStle’s performance. In its separate state court case, P180 alleged that CaaStle’s leadership had been aware of the company’s “huge financial issues” since at least December 2024 but continued to mislead P180 for months while orchestrating self-interested transactions.
The Conspiracy’s Expanding Scope
P180 asserts that the defendants used their control over CaaStle and influence within P180 to induce it into questionable transactions, including acquisitions involving luxury brands like elysewalker, Altuzarra, and Vince. The lawsuit claims that these deals were structured based on CaaStle’s supposedly unique technological capabilities – capabilities that the defendants knew did not exist.
The lawsuit details numerous instances where defendants allegedly made false statements or omissions to P180’s investors, board members, and potential partners. Even after the fraud became known internally in late 2024, P180 claims that members of the Hunsicker Enterprise concealed the true state of affairs while orchestrating additional transactions that burdened P180 with significant debt.
Central to the lawsuit are detailed allegations of wire fraud and bank fraud. Among other transactions, P180 cites multiple unauthorized fund transfers from its bank accounts, including $1.4 million and $500,000 withdrawn in June 2024, $950,000 and $450,000 withdrawn in July 2024, and two transfers totaling $1.3 million wired to Hunsicker’s personal account in January 2025. These unauthorized transfers, P180 alleges, were designed to siphon funds to CaaStle and individual conspirators to cover losses or maintain the appearance of solvency.
The complaint also brings breach of fiduciary duty claims against Hunsicker and Goldenberg, who served on P180’s board. P180 alleges they actively participated in covering up the fraud, pushed P180 into harmful transactions, and failed to disclose CaaStle’s insolvency while personally benefiting from P180’s misfortunes.
Adding to the intrigue, the complaint notes that one outside director, John Hennessy, chairman of Alphabet and former president of Stanford, resigned from CaaStle’s board upon learning of the alleged fraud, while defendant Callon, himself an expert in corporate governance, allegedly aided in prolonging the conspiracy.
With the foregoing in mind, P180 accuses the defendants of violating the Racketeer Influenced and Corrupt Organizations Act (“RICO”), and engaging in conspiracy to violate RICO, conversion, unjust enrichment, breach of fiduciary duty, fraudulent inducement and concealment, aiding and abetting fraud, aiding and abetting breach of fiduciary duty, civil conspiracy, and negligent misrepresentation. P180 is seeking compensatory damages, treble damages under RICO, punitive damages, restitution of the diverted funds, and attorneys’ fees.
The damages run into the tens of millions of dollars, per P180, with $5.35 million in liabilities alone tied to the Vince acquisition. In the earlier state court action, which does not make RICO claims or target as large of a pool of defendants, P180 alleged total losses exceeding $58 million.
The Bigger Picture for CaaStle & Co.
The federal lawsuit is only part of the growing legal crisis facing CaaStle and Hunsicker. Once billed as a revolutionary player in the trillion-dollar fashion industry, CaaStle had presented itself to investors as a high-growth business with projections of $793 million in revenue for 2024 and $1 billion in 2025, alongside claims of “hundreds of millions” in cash on hand. Having raised approximately $530 million in venture capital, its founder was actively courting more investment before the company’s sudden collapse.
In addition to the P180 lawsuits, CaaStle and Hunsicker are also being sued by EXP Topco, LLC, the owner of the EXPRESS trademarks. That lawsuit alleges trademark infringement, breach of contract, and unjust enrichment in connection with CaaStle’s operation of the Express Style Trial rental service; and in response, CaaStle has filed crossclaims against Hunsicker, alleging that she is responsible for the alleged misconduct at the center of the lawsuit.
Adding to CaaStle’s growing legal exposure, investor rights law firm Bragar Eagel & Squire, P.C. has announced that it is investigating potential claims on behalf of CaaStle investors, including possible securities fraud and unlawful business practices, raising the possibility that class action litigation may follow.
The case is P180, Inc. v. Singh, et al., 1:25-cv-04432 (SDNY).
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