Partnership Dispute. Lawsuit Pending. Have I missed anything?

miketpowell said:
Why do you think they owe you money? If you invested in the business and they ran it badly and it didn't profit you don't get to sue them for the money they should have paid you.

Have they been taking profit out of the company or something? This sounds like you invested in a venture that hasn't been profitable. If that's the case you lose out on your investment - you don't get to sue them simply because they didn't manage to turn a profit for you.
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Yes, the other partner has been taking a nice chunk of money every year $10k-15k that I haven't been able to see myself. I didn't hand the money over to them. I used the money to buy equipment for the company to increase production and save costs. Then it was my turn to walk away. I walked away from daily management of the company with an understanding and paperwork being prepped. Paperwork is done, I just haven't seen it because they kept bullshitting me on when I could come sign the paperwork and take my initial 10k. The company makes a nice profit. I handled all the financial stuff as well.

thehobbster said:
Sounds like you made an "investment" versus a "partnership," despite the legal jargon. You made a bad investment. It happens. You aren't going to get your extra 20k out of them if they don't have it. AND you'll have to ruin them to get it. And you're talking about your family that you love and care enough for that you were willing to pony up and help them launch a business. Don't fuck them over. Tensions are going to get high and people are going to say shit they regret, but remember where you all started.
What I would do is attempt to give them this option in a friendly fashion:
Liquidate the entire company, and all proceeds go to you, AND they go get regular ass jobs and pay you back the balance within 24 months (monthly payments or something).

It just seems like there is a way to settle this problem without ruining your relationship with some of the most important people in your life.
Then again though, if they want to herp and derp instead of taking responsibility and making that money back, then do what you have to do get your money, based on principal.

But for fuck's sake. Don't let that domain expire, or you lose almost all leverage you really have.
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I spent my own money on equipment for the company to be able to produce quicker and save costs. I've actually never been that close to this side of my family. If they're willing to fuck me out of the money, why should I worry about creating any further hardship for them? I never suspected anything going wrong until I heard they were doing business behidn my back and their employees were told to not tell me they were making money behidn my back.

I had a strategy with letting it expire, that I won't discuss further. I do beleive my best bet is to renew the domain. It's goign to be my last attempt at communicating with them. I'm goign to let them know a couple days before it expires and give them a heads up and see if we can't work things out that way.


elgordo said:
Didn't read all the replies but I've done a couple of partnership ventures before.

First and foremost: did you at least do a 1-2 page term sheet?

You mention certain things were "understood" ... but how is that possible if its not documented and signed?

Since it sounds like you didn't do even basic things to protect yourself, you'll need to leverage the domain (which is under your name) to get what is owed.

Be careful about leveraging the domain. You SHOULD renew the domain, but you should be very careful about leveraging it for a payout. Why? Because it could be perceived as domain squatting in court, and you could get buried.
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We have an operating agreement. We have many emails between my partner and I, plus I have all the financial transactions backing up my case.

galacon said:
So you keep using the generic term "Partner" and then use the term "Family" multiple times like they are mutually exclusive. I don't understand- is your "Partner" also "Family?

And you further state your agreements are based on spurious and ephemeral shit like Facebook posts etc., is that right? And that you've converted company assets to hostage collateral and seized the company domain without due process?

You front as a "Businessman", and claim to have a "Business". Did you think you were special? That you could be the one-in-a-million who would have a good experience with NO business plan...NO clear, written agreement...NO iron-clad exit strategy? Especially with FAMILY? And you're a "Businessman"?

Mate, if I was you, I would BEG a mod, no, I would offer to suck Jon off on the dance floor at the next Aff Summit to remove this thread and ban me forthwith for being dumb enough to post this here.

I don't care how long you've been a member, or what you've done, this is fucking pathetic. Good luck, kiddo.
lolbusinesslol.
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Yes, my partner is family. If you like to read what I've written, I have,
one, a single, agreement via a facebook message between me, my partner and our legal liason that was to get the official paperwork started. Since they obviously didn't follow through on their end, that's what I'm left with.
And I' not even necessarily interested in fighting for 50% of the company. I just brought it to light.

I took the assets I paid for out of my pocket. I didn't seize the domain.
I've always controlled it and still plan on handing it over per our agreement, if they were to hold up their end of the bargain.

I've openly admitted to my many faults with my first partnership. Some lessons are hardlearned.

BTW, thanks for nothing.

c4yrslf12 said:
Offer to buyout instead, and acquire his 75%, of which you pay your buyout fee after you've recouped.

A.) Family member gets something back and doesn't feel like they're out forever

B.) You control the income producing asset.

Give now, take later.
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I've tried. No luck whatsoever.

BluAffiliate said:
I would try to get the company back on it's feet, reconcile with your family, then when the company has enough cash I would solemnly cash out, wishing then luck and move on.
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Hadn't really thought about it. May consider this. Thanks boss.

JonesersRX7 said:
Didn't read all the replies but...

Things you should NOT have done:
- Take company assets hindering them from continuing daily operations
- Impede their ability to operate in any way
- Believe you have some "Napkin partnership" via facebook chat
- Not securitize your capital contribution by means of a Note via a personal guarantee OR against company assets.. Land being best option here.
- Not setup an operating agreement or proceed in any means without any legal/binding agreements because "they were taking too long"

Things you should do:
- Not post this shit here
- Consult with legal on best course of action to recoup your $25K. Would seek to get repayment of capital contribution over time
- Determine if $25K is really that big of a deal for the amount of time, energy and outcome this will have with your family
- Read more business books and keep in mind this will be a $25K investment on how NOT to do business.
- Learn to analyze investments better. (How much did you believe your $25K would make you?) Should be getting at least 40-50% return buying traffic right?
Better fortunes next time man.
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They still have equipment to operate teh company daily. I didn't hinder that. I don't have some napkin partnership via facebook. We have an operating agreement that's been in place since we started the company. Sorry if that wasn't made clear. Please see my replies above for further informatio on the facebook chat you're thinking of. Again, securitizing my capital contribution was a big mistake. One of teh lessons I've learned for future business ventures.
 


ITT: Warrior Forum disputes

@ OP,
Stop being defensive. Stop rationalizing shit. Stop trying to make yourself look not so bad.

You fucked up. Accept it. Learn. Move on. Stop whining and looking for sympathy from us: You will find none.

Also, I believe an operating agreement is part of an LLC, do you have one? If not, then you don't have an operating agreement from my understanding of what an operating agreement is. Also, if the money was a loan, and everything is as documented as you say it is, then surely you have an written and signed agreement (drafted by an attorney) as to the conditions of the loan, and the proper procedure to be taken based on the different variables that can be present. If that is the case, why are you posting here?
 
managing partner (like ceo) is just a title, it doesn't give you inherent power to do absolutely anything, muchless steal equipment. and unless you stated somewhere that the money was a loan to those individuals, they don't owe you anything and you can't just take it back from the business either (even if the business had it).

all said and done, you should try to come to terms and make actual money (this is what the business is about presumably?) you're all enraged right now so until everybody has their resting period nothing will get done, but eventually everyone will restore to their normal human behavior. as long as no one does anything overly rash, you can still make a comeback. if you have huge balls, step up, offer an apology for the mistakes you made, mention you're prepared to come to terms--we're all family and we have a great opportunity here and we shouldn't do this to each other(don't expect immediate hugs). it'll speed all this shit up.

hope it all works out.
 
One big clusterfuck of a text wall.

Brah some things in here don't really make sense.
 
This rule is so under rated, keep your family and business completely separated. Money and blood don't mix, like two dicks and no bitch, find yourself in serious shit.

[ame=http://www.youtube.com/watch?v=ZYb_8MM1tGQ]Biggie Smalls - Ten Crack Commandments - YouTube[/ame]
 
Hang on...if OP purchased equipment out of his own pocket to "use" in the production process and those assets were never consigned to the partnership but merely made available for their use, I fail to see where ownership was conferred. I would suspect that if you could prove title by showing purchase receipts in your legal name that you should be fine to remove those items as they were only loaned to the partnership for use and no transfer of title occurred.

Yay/Nay ???
 
ownership

One thing you said sticks out to me. You said that they were 75% owners and you were 25% owners. Unfortunately, they can do whatever they want with the business including forcing you out. The only thing you have the right to is the money back you invested, if you have a legal agreement stating the details of the loan. You should have opted for 50/50 up front for the fact that you were putting up all the capital to get it going and they just put in the work of the product (i am guessing). Another words, I think you are screwed and have no right to the website at all even if the domain is in your name. They can legally force you to give it up and set up a payment plan set out by an attorney but I think it is better you just walk away because I don't think you will ever get your money out of it. You should return the equipment and say that it was wrong because it is the business equipment and not yours personally and then try and go after them if you want, but to me it's not worth it at this point.

Just start a competing site and crush them :)
 
I did not read all of the thread but if seriously interested in selling the website...

I AM INTERESTED.

thanks,
 
Don't screw with attorneys. If you have control of the site tell you will take it down if they don't provide some form of payment. If they don't agree and make good on whatever plan you agree on just take the site down and don't look back.

Attorneys will only suck you dry and as you have said they have nothing to give you as they are broke.
 
flaw3d said:
One big clusterfuck of a text wall.

Brah some things in here don't really make sense.
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I was responding in a rush yesterday. Sorry if they don't make sense, but it's pretty cut and dry.

sk4rlet said:
managing partner (like ceo) is just a title, it doesn't give you inherent power to do absolutely anything, muchless steal equipment. and unless you stated somewhere that the money was a loan to those individuals, they don't owe you anything and you can't just take it back from the business either (even if the business had it).

all said and done, you should try to come to terms and make actual money (this is what the business is about presumably?) you're all enraged right now so until everybody has their resting period nothing will get done, but eventually everyone will restore to their normal human behavior. as long as no one does anything overly rash, you can still make a comeback. if you have huge balls, step up, offer an apology for the mistakes you made, mention you're prepared to come to terms--we're all family and we have a great opportunity here and we shouldn't do this to each other(don't expect immediate hugs). it'll speed all this shit up.

hope it all works out.
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I've been considering this option more and more. Still likelihood of getting my money back is slim.

greenleaves said:
ITT: Warrior Forum disputes

@ OP,
Stop being defensive. Stop rationalizing shit. Stop trying to make yourself look not so bad.

You fucked up. Accept it. Learn. Move on. Stop whining and looking for sympathy from us: You will find none.

Also, I believe an operating agreement is part of an LLC, do you have one? If not, then you don't have an operating agreement from my understanding of what an operating agreement is. Also, if the money was a loan, and everything is as documented as you say it is, then surely you have an written and signed agreement (drafted by an attorney) as to the conditions of the loan, and the proper procedure to be taken based on the different variables that can be present. If that is the case, why are you posting here?
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Only reason I'm being defensive is because some people are just fuckin stupid and it's annoying. Some people at WF are ridiculous.

I have fucked up. I'm not shying away from this, either.

We do have an operating agreement in place. I've said this a few times.

The documentation for the money isn't drafted by an attorney. Biggest lesson I've learned from this.

346media said:
One thing you said sticks out to me. You said that they were 75% owners and you were 25% owners. Unfortunately, they can do whatever they want with the business including forcing you out. The only thing you have the right to is the money back you invested, if you have a legal agreement stating the details of the loan. You should have opted for 50/50 up front for the fact that you were putting up all the capital to get it going and they just put in the work of the product (i am guessing). Another words, I think you are screwed and have no right to the website at all even if the domain is in your name. They can legally force you to give it up and set up a payment plan set out by an attorney but I think it is better you just walk away because I don't think you will ever get your money out of it. You should return the equipment and say that it was wrong because it is the business equipment and not yours personally and then try and go after them if you want, but to me it's not worth it at this point.

Just start a competing site and crush them :)
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I'm well aware they can force me out. I do want to give them everythign and go after my money then, but based on their actions so far it'll be very tough to make happen.

jryan54 said:
Hang on...if OP purchased equipment out of his own pocket to "use" in the production process and those assets were never consigned to the partnership but merely made available for their use, I fail to see where ownership was conferred. I would suspect that if you could prove title by showing purchase receipts in your legal name that you should be fine to remove those items as they were only loaned to the partnership for use and no transfer of title occurred.

Yay/Nay ???
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Exactly.
 
You've said you're the managing partner, and you've said you have an operating agreement, so I'll assume you all formed an LLC even though you haven't come right out and said that (unless I missed it).

So the question is, did you buy the equipment and decide out of the goodness of your heart to allow them to borrow it for a limited time, or did the Managing Member of the LLC buy the equipment for the company?

If version A is what happened then you're probably fine, but if it was version B and your partners aren't inbred retards then you are probably fucked. And not just in terms of whether or not you are on the hook for the theft of equipment (yes, you can steal from your own company), but how was that equipment treated from a tax standpoint?

Did you write it off against profits, is there a depreciation schedule somewhere in the business taxes indicating that equipment was "owned" by the business? If yes, then according to the IRS either you stole it, or the company (ie - you, the Managing Member) is guilty of knowingly lying on the tax forms. Either way, you're not in a very good position to say the least.

I know in your mind you're thinking you bought it so it's yours, but that's not how it works. I hope for your sake that equipment never made it into the tax filings for the LLC. As dumb as that would be from a tax standpoint (i mean, why in the fuck would you have a depreciable asset used by the business that wasn't being used to minimize your tax burden) it might save your ass from a legal standpoint.
 
rileypool said:
Only reason I'm being defensive is because some people are just fuckin stupid and it's annoying. Some people at WF are ridiculous.

I have fucked up. I'm not shying away from this, either.

We do have an operating agreement in place. I've said this a few times.

The documentation for the money isn't drafted by an attorney. Biggest lesson I've learned from this.
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I'm not sure how 'I fucked up' = I have a right to be defensive because people are stupid.

Either you see your error from a point of humility and learn, or you act defensive and don't. There isn't much middle ground. When you are defensive you aren't analyzing things rationally, but emotionally. And as much as criticism might burn you, you deserve it, it is good for you (the most hurtful criticism is always the truth), and you can learn from it. Or not.
 
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