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  "documentTitle": "PetIQ, Inc. (PETQ)",
  "authorId": "54_Spruce_Point_Capital",
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  "sourceTypeSlug": "short_seller",
  "sourceTypeLabel": "Short seller",
  "presentationDate": "2019-04-30 00:00:00",
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  "pageNumber": 20,
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  "notes": "The slide uses a narrative structure to expose historical accounting fraud and link it to the current target company.",
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      "text": "Christensen's apparent relationship with Fleming management is particularly concerning to us given PetIQ's and VIP Petcare's demonstrated dependence on vendor rebates for earnings.",
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      "text": "Three columns of text detailing the historical timeline and quotes regarding Fleming's accounting practices.",
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      "text": "The Fleming scheme involved management’s use of vendor deductions without vendor authorization with the intent of improving cash flow and inflating earnings after launching its discount “Food 4 Less” concept store. Management convinced analysts and investors that the earnings improvement was due to the success of the new concept, but its earnings growth was in fact driven by the unilateral enforcement of unauthorized vendor rebates. This scheme was orchestrated in part by then Fleming CFO John Simrell – the same individual who was shown to have orchestrated Food 4 Less’ investment in the Petters scheme with Cord Christensen.",
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      "text": "Christensen’s apparent relationship with Fleming management is particularly concerning to us given PetIQ’s and VIP Petcare’s demonstrated dependence on vendor rebates for earnings, as well as True Science’s apparent dependence from 2010-16 on non-arms-length relationships with veterinary drug vendors – one of which accused True Science of attempting to use the close relationship to inflate earnings through accounting manipulation.",
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      "kind": "quote",
      "text": "\"On a $10,000 invoice they'll take a $4,000 to $5,000 deduction with no justification, an it takes us months to collect the money back,\" the vendor said. \"When it comes to deductions, they're off the scale compared with other customers.\" — Unnamed vendor quoted in Wall Street Journal article.",
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