Marcus Lemonis Confronts Gavin Newsom’s Response to Bed Bath & Beyond’s California Exit

In a heated exchange that has ignited debates across media platforms, Marcus Lemonis, the executive chairman of Bed Bath & Beyond, publicly criticized California Governor Gavin Newsom’s dismissive response to the retailer’s decision to forego opening physical stores in the state. Lemonis, a seasoned entrepreneur and television personality, announced that Bed Bath & Beyond would not establish brick-and-mortar locations in California, citing an overregulated, costly, and risky business environment. Newsom’s retort, delivered via a snarky post on X, mocked the retailer’s bankruptcy and questioned its relevance, prompting Lemonis to call out the governor’s lack of good-faith engagement. This clash, discussed in a recent panel segment, highlights a deeper tension between California’s business climate and its political leadership, with implications for consumers, entrepreneurs, and the state’s economic future.’

The Decision to Skip California

Bed Bath & Beyond, once a retail giant with over 80 stores in California, filed for bankruptcy in 2023, closing all its physical locations. Under Lemonis’s leadership, the company, now owned by Beyond, Inc. (formerly Overstock.com), is staging a comeback with plans to open 300 new stores nationwide. However, California is conspicuously absent from this expansion. Lemonis explained the decision in a statement on August 20, 2025, saying, “California has created one of the most overregulated, expensive, and risky environments for businesses in America. It’s a system that makes it harder to employ people, harder to keep doors open, and harder to deliver value to customers”.

Lemonis emphasized that the decision was not political but pragmatic, driven by high taxes, steep labor costs, and excessive regulations. “The yield is so bad, it’s awful,” he said during a panel discussion, noting that California’s consumer base and average income are attractive but outweighed by the costs of doing business. Instead of physical stores, Bed Bath & Beyond will serve California customers through its online platform, offering 24- to 48-hour delivery and same-day service in some areas. This strategy, Lemonis argued, allows the company to avoid the “inflated costs created by an unsustainable model” while still reaching consumers.

Newsom’s Social Media Salvo

Governor Newsom’s response to Lemonis’s announcement was swift and biting. On X, his press office posted, “After their bankruptcy and closure of every store, like most Americans, we thought Bed, Bath & Beyond no longer existed. We wish them well in their efforts to become relevant again as they try to open a 2nd store”. Newsom himself doubled down, writing, “The company that already went bankrupt and closed every store across the country two years ago? Ok”. He even took a playful jab, posting about a fictional call from Bed Bath & Beyond to sell his branded hats, to which he responded, “No thank you!”.

These remarks, dripping with sarcasm, were seen by many as unprofessional and dismissive. Lemonis, during the panel discussion, expressed disappointment at Newsom’s tone, saying, “I thought it was a very intellectual, forward-thinking discussion… but he told me, ‘You don’t know what you’re talking about’”. He noted that he had attempted to engage Newsom constructively, even texting a mutual acquaintance—a major tech CEO—to mediate, but received no response. “I apologize if you took it personal, but it is a real true fact I would like to talk about,” Lemonis said, emphasizing his desire for a substantive dialogue about California’s business challenges.

The Panel Discussion: A Broader Critique

The panel, hosted by Brian, included Lemonis and other business figures like Tom, a California resident, and Lydia, who offered perspectives on the state’s economic climate. Brian framed the issue starkly: “High taxes, crime, riots, never-ending red tape—that’s the reality business owners face in California, driving residents and companies out of the state.” He criticized Newsom for being “too busy on social media to notice or care,” suggesting the governor’s focus on snarky retorts overshadowed the real issues.

Tom, a Newport Beach resident, acknowledged California’s appeal—pleasant weather, a vibrant consumer base, and high incomes—but argued that its business environment is “prohibitive.” He cited the example of In-N-Out Burger, a California cultural institution, moving its headquarters to Tennessee due to similar concerns. “Money goes where it’s treated best,” Tom said, pointing to the state’s failure to incentivize businesses. Lydia echoed this sentiment, lamenting the lack of constructive dialogue. “Why not pick up the phone and say, ‘Tell me more, what should I understand?’” she asked, calling Newsom’s response “disappointing” and “arrogant”.

The panelists agreed that the ultimate loser is the consumer. “We have to think about California pricing because of all the frictions created between the cost of goods and retail price to break even,” Tom explained, highlighting how regulatory costs drive up prices for residents. Brian drew a parallel to Minnesota Governor Tim Walz, who once rooted against Tesla’s stock despite state investments in the company, suggesting a pattern of politicians undermining American businesses for political points.

California’s Business Climate: A National Debate

Lemonis’s decision to bypass California is part of a broader trend. Companies like Tesla, SpaceX, Chevron, and now In-N-Out have either relocated or scaled back operations in the state, citing high taxes, stringent regulations, and rising costs. Lemonis pointed to specific challenges: expensive real estate, complex legal processes, and labor regulations that make profitability elusive. “When you compare the 50 states you do business in, California purges all the benefits with what it costs to operate,” he said.

Newsom and his supporters counter that California remains an economic powerhouse, boasting the fourth-largest economy globally, surpassing Japan in GDP. They argue that the state’s high wages and regulations protect workers and ensure quality of life. However, critics like Lemonis contend that these policies create an unsustainable environment for businesses, particularly mid-sized retailers like Bed Bath & Beyond, which are still recovering from financial setbacks.

Newsom’s Leadership Style Under Fire

Newsom’s response to Lemonis has drawn criticism for its tone and lack of engagement. “It feels unprofessional and not gubernatorial,” Lemonis said, noting that Newsom’s focus on social media jabs—such as mocking Bed Bath & Beyond’s bankruptcy—missed an opportunity to address legitimate concerns. Posts on X echoed this sentiment, with users calling Newsom’s behavior “arrogant” and “petty”. One user wrote, “Celebrating people’s demise… he didn’t understand we bought the IP out of bankruptcy,” referring to Newsom’s apparent misunderstanding of the company’s revival strategy.

San Jose Mayor Matt Mahan, a fellow Democrat, offered a more measured critique, calling the situation “serious” and urging California to “stop shooting itself in the foot” by creating barriers to business. Lemonis expressed openness to dialogue, saying, “I would say, here are the issues I have, tell me why I’m thinking about this the wrong way”. Yet Newsom’s refusal to engage substantively has fueled perceptions of a governor more focused on viral moments than governance.

The Consumer Impact

The panelists emphasized that California’s business climate ultimately harms consumers. High costs force companies to raise prices or, as in Bed Bath & Beyond’s case, avoid physical stores altogether, limiting access to goods and services. “The ultimate loser in the situation is the consumer,” Tom said, noting that regulatory burdens inflate retail prices. For a state with a reputation for innovation and entrepreneurship, the exodus of businesses like Bed Bath & Beyond and In-N-Out raises questions about its long-term economic viability.

A Missed Opportunity

Lemonis’s clash with Newsom underscores a broader divide between California’s political leadership and its business community. While Newsom touts the state’s economic achievements, executives like Lemonis argue that policies are driving companies away. The governor’s sarcastic response, rather than fostering dialogue, has deepened the rift, leaving many to wonder whether California can balance its progressive ideals with a business-friendly environment. As