Supreme Building Technologies Suit
Collusive lawsuits have a long history in the United States going back to Fletcher v. Peck. To that tradition, may we add Supreme Building Technologies v Elite Manufacturing?
Supreme Building Technologies was incorporated by Alvin Handshoe, with Ryan Deetz as registered agent, on January 10, 2007. Five days later, Elite Manufacturing entered into a contract with this venerable entity to "act as general contractor for the construction of all of Elite's franchise buildings..."
Perhaps Morg Morgan had a soft spot for a company which was a mere 120 hours old, and felt that they were just the type of stable organization he could entrust with a million dollars worth of commercial construction. Or perhaps SBT was incorporated for the purpose of conducting business with Morgan's entities. You be the judge.
Within 10 months, SBT was getting grants and tax credits from the taxpayers of Indiana--just as the Cuppy's saga was once again preparing to explode on the internet. Cuppy's was the franchisor under common control with Elite Manufacturing, and in turn Elite Manufacturing was the "primary" (that's an understatement!) customer of SBT.
According to published reports, franchisees of Cuppy's would tender money not to the franchisor but rather to Elite. What happened to all the money remains an open question, but a significant portion of the money appears to have vanished and numerous franchisees got nothing for their money.
So long as Morg Morgan was in control of Cuppy's, Elite, and Medina, all went well. Odd things began to come to light once the convoluted corporate structure began to implode, and Morgan bailed out, leaving the new owner as Fransynergy Inc (a company controlled by Dale Nabors).
The first oddity was an "Exhibit D" to another oddity: the oxymoronically-titled "Agreement for the Sale of Corporate Stock and Membership Interests." Leaving aside that an LLC does not have "corporate stock", the Exhibit D appears to obligate Fransynergy Inc to liability beyond the limited liability of Fla. Stat. 608.4227
More significantly, the Exhibit appears to create an obligation to an intended third-party beneficiary , which is... drumroll please... Supreme Building Technologies!
Normally, the members of an LLC have no liability for the obligations of the LLC--that's why it is called a Limited Liability Company.
As such, while Elite would of course have had continuing obligations to its vendors, the purchaser of the membership interests would have no more lawful obligation than the previous owner. And generally there would be no lawful basis for Supreme to have any right to interfere in the internal member affairs of a company with which it purportedly had a mere arms-length vendor/vendee relationship (exceptions would be where the third-party has a contract containing a "change of control" provision, but that does not appear to be the case here).
One might argue that Exhibit D is mere surplusage. But this is belied not only by the fact that it is an addendum to the agreement for transfer of membership interests--meaning that the parties gave this matter specific thought and deemed it necessary and not otherwise covered by the contract or common law/statutory obligations, and further the SBT Complaint at paragraph 11 obliquely references a "reaffirmation" of contractual obligations--so the SBT lawyer obviously believes Exhibit D is of legal significance to his cause of action.
Given the ongoing contractual obligation between Elite and SBT, why would one need to "reaffirm" anything? Why would it be necessary to discuss a "reaffirmation" at all in the pleadings? Why is there no discussion as to how SBT came to have this critical document in its posession before discovery (but conveniently in time for the lawsuit filing)? If Morg Morgan was running the show when the debts were piling high and the money vanishing, why didn't Morgan have to assume an "obligation" to SBT?
Most inexplicable: why would Dale Nabors sign "Exhibit D" in the first place?
Nabors has legal counsel on the payroll and prior M&A experience. Nobody in his right mind would sign a document like that, and I can't think of any lawyer who would "accidentally" draft such an ambiguous document, let alone create third-party beneficiaries and endanger otherwise-shielded assets of the Purchaser.
Miraculously once Morgan was no longer the owner of Elite, the SBT accounting department suddenly discovered that there were huge unpaid debts (!!!) and filed suit against Elite.
Another question is why SBT has apparently not filed any mechanics/materialmans liens.
This is a bit of an arcane area, governed by state law, but basically: when you perform work such as SBT allegedly has done, if you are not paid you can file a lien against the property. This is a very powerful tool since it can result in the tenant being in default of their lease. Some states follow the rule that the rights of the lienor are derivative of the rights of the general contractor (so if the zee had paid Elite, then SBT would have no recourse) but some states follow the Pennsylvania rule and permit the subcontractor to file notwithstanding full payment to the GC. Caution to Cuppy's franchisees: if you used Elite and/or SBT, talk to your legal counsel about this!
The pleadings state that Elite is a "franchisor...doing business as Cuppy's Coffee" which as anyone would know from the most cursory inquiry is a false statement. Even the "depositors" never claimed that Elite was a "franchisor", and given the existence of state and federal law on the subject, it is not likely that an attorney practicing in federal court would fail to understand who the "franchisor" was, nor accidentally claim that an LLC is "doing business as" an "Inc." The law firm's receptionist would not make that kind of mistake.
Remember--Elite was not one of many SBT customers, it was SBT's raison d'etre and was in constant communication with Elite staff and even got itself superior legal rights by inserting itself into a contract to which it had no business being in the middle of.
Elite has no money, as the disgruntled "depositor-franchisees" have already discovered. And yet SBT obliquely threatens the assets of Fransynergy Inc but does not name it as a party-defendant. So what's the benefit?
Well, if it is true that the state of Indiana is getting tips about the SBT/Elite/Medina/Cuppys entanglement, they may start poking around and see what happened to that "performance-based" money. And a nicely packaged lawsuit and an uncollectable judgment make for a good facade.
It is worth remembering that all these folks were dealing in multi-million dollar commercial transactions. You don't play in that league without having lawyers involved every step of the way.
For the historically-minded, it is worth contemplating the parallels between "Exhibit D" and the Snowden/Morgan "promissory note" of yore.
It strains credulity to believe that lawyering would be so sloppy, but deliberately sloppy lawyering explains a lot in the SBT/Elite lawsuit.
Stay tuned...
Dale Nabors/Cuppy's Coffee - Latest Update....
The sky has fallen on Dale Nabor's Dream Team in AL. Dale has finally gotten up enough nerve to meet with the employees that followed him up to Muscle Shoals, AL and told them he can NOT get the money to pay them. But he wanted to know who would continue to work for him for FREE. Has he lost his mind totally? He also told them if they would not stay and work free he did not want them to blog him. WTF????!!!!! He's an arrogant sh it!! So... now there are NO employees at Cuppy's/Elite/Medina! Dale is still trying to sell Elite contracts to Brian Hayes. But remember franchisees... Brian Hayes/SBT or whatever name they go by these days is overcharging you for buildout and equipment. Your best bet is to take whatever loss you have now and sue Morg/Dale/Medina/Fransynergy and try to recoup your deposit moneys. Cuppy's is dead! Even if a franchisee let SBT continue to build them out, I would NOT call it Cuppy's. Cuppy's has an awful name and I don't even think God himself can raise that dead franchise. Franchisee please listen up... you need to join together to get justice. There are more people out here willing to help you get that justice than you may think. Good luck to you zees and to the employees that followed Dale to AL and had work for 2 months without pay. I wish you all well.
Deliberately sloppy lawyering can make the lawyer an...
accomplice in a scheme to defraud.
Lawyers who connive with clients to create obviously fraudulent agreements have accomplice liability, criminally and aider and abettor liability civilly.
No lawyer with assets and a successful practice would do such a thing unless he was an intentional miscreant.
What Paul has done a lot of work to account for depicts a juicy scenario for prosecution.
Since a lawyer defendant woiuld lose his law license upon conviction, one might suspect that the "lawyer" who drafted these documents was someone who has already been disbarred and who is practicing law illegally. Disbarred lawyers work cheap. - Like one I knew who was a disbarred and prison time serving probate judge who sold franchises for one company, telling franchisee prospects that the business was so good that he retired from the bench to buy one for himself.--
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
Tangled Web
Please allow us to contribute a bit more knowledge to this tangled web that has been woven by Java Jo'z/Cuppy's/Medina/Elite/Supreme Building Technologies (if we have left anyone out, we apologize). As a previous consultant and supplier for Java Jo'z/Cuppy's franchisees, we have, or should we say had, first-hand knowledge of the way in which each of these entities conducted business.
First, we became a consultant for Java Jo'z, a liason if you will, between the company constructing modular buildings (located in North Carolina) for Java Jo'z licensees and Java Jo'z corporate, which at the time included the team of Roy Snowden, Robert "Morg" Morgan, Ben Doyle and Doug Hibbing. Then, we all know what happened next, Mr. Snowden's tax problems finally caught up with him and the company "changed" from Java Jo'z to Cuppy's under the ownership of Medina Enterprises, which alas was owned by Robert "Morg" Morgan. Also, let's not forget, Elite Manufacturing emerged at this same time as the supplier of choice for Cuppy's franchisees for their modular drive-thru buildings and/or in-line cafes.
Let's fast forward about eight months...Brian and Brice Hayes along with Doug Hibbing pay a visit to our company to discuss constructing modular buildings for Cuppy's (that is Elite Manufacturing). We shared knowledge with them, being told that we would continue to be an integral part of the Cuppy's/Elite team and would remain the liason between the building manufacturer and the Cuppy's franchisees except that Superior Canopy Corporation out of Angola, Indiana would be the manufacturer of choice. Does Angola, Indiana ring a bell to anyone?
Let's fast forward another five months. We are now owed in excess of %500K for unpaid services performed for Elite Manufacturing so we pulled the plug so to speak on all work being performed (at this point we were being hired by Elite to manage both modular and in-line cafe construction). What happened? We were sued by Elite for breach of contracts, even though the contracts were breached for non-payment by Elite, who, keep in mind, had been paid by the franchisees. We know this because we were in contact directly with the franchisees whom as you can imagine were extremely upset that they had done their part, paying their money, yet not getting anything in return but a consistent run-around...sorry, let us get back to the story...we intended to file a counter-suit, but by this time our company was so far in debt, we had no choice but to close the doors, end of our part of the story.
Still keeping up with all that was happening with this entire saga, just call us crazy, fast forward a few months later and we read that Brian Hayes is now President of Elite Manufacturing, headquartered at 1511 Wohlert Street in Angola, Indiana. Take a look at www.elitemfgcorp.com and click on the "Contractors" link to see their address. Elite was always located in the same building as Java Jo'z/Cuppy's/Medina in Fort Walton Beach, Florida or we believe they told everyone, Mary Esther, Florida, but trust us, they were all in the same building...oh, sorry, back to the story again...more stories emerge of franchisees losing money, can't get refunds, blah, blah, blah (not to demean anyone, but no need to rehash that information) and then Medina Enterprises (a.k.a. Robert "Morg" Morgan") sells the company to Dale Nabors; this gives the franchisees and all of us keeping up with the sordid tale new hope.
But alas, now we see that a company called Supreme Building Technologies has sued Elite Manufacturing for $1.7M, give or take a few dollars. Now take a look at this excerpt from the press release in November 2007...
ANGOLA, Ind. (Nov. 19, 2007) – Supreme Building Technologies, a start-up commercial construction company, announced today it will locate its headquarters and manufacturing operations here, creating 60 new jobs by 2010.
The company, which specializes in the build out of commercial buildings and manufacturing of small modular buildings for the food and beverage industry, will locate its 85,000 square-foot headquarters and manufacturing operations in leased space at 1511 Wohlert Street.
Does the address listed above, 1511 Wohlert Street, Angola, Indiana sound familiar? It should...take a look at Elite's website as we stated earlier. Also, just out of plain old curiosity, we called our old friends at Superior Canopy Corporation and were told that Brian and Brice Hayes were no longer employed by Superior Canopy, but that they were still "part owners" (this information was given to us after a brief chuckle by the receptionist whom, by the way, did answer the phone as Superior Canopy). Under the disguise of looking for a modular buildng manufacturer, she gave us the name of Alvin Handshoe at Allied Manufacturing. Now notice this odd situation...Alvin Handshoe incorporated Supreme Building Technologies, but now works for Allied Manufacturing (also located in Angola, Indiana) and his name was given to us by the receptionist at Superior Canopy Corporation, which was from where we sort of started this whole mess with Brian and Brice Hayes visiting us representing that company...go back to the beginning if you must at this point because all of this will make you dizzy!
Anyway, we do not know how Supreme Building Technologies, Allied Manufacturing, Superior Canopy or Elite Manufacturing are all connected, but they must be, some way, some how...too many of the same players are involved and all the companies mentioned were given economic incentives from the State of Indiana.
There was always something rotten in Fort Walton Beach, Florida, but now it looks like the stench has drifted to Angola, Indiana!
SBT,Allied,Superior Canopy,Elite....or someone else
I wonder who did the build out at 1511 Wohlert Street, Angola......
Get real Cuppy's
For one, what the heck kind of name is Cuppy's? Who wants to hang out at a place called that? Also, with topics like above- is Dale going to pay them now that he took over Cuppy's and inquired the assets of Elite? I think he is messing around with everyone. He is broke, can't afford anything- and won't return anyone's calls that have been waiting for a refund. When someone wants to do something else with their investment they try to get them to buy something else- we don't want anything else - we would like our money back. I have one question what happened to all the stores that were on your website? Like Queens Creek- Christiansburg- Hemet- I have seen a lot come and go- that sounds like an unstable business. I am pretty upset about this whole company.
Cuppied is the new Munsoned
Mufflerman wrote: I wonder who did the build out at 1511 Wohlert Street, Angola......
That one made me spew my coffee. lol
Guest wrote: For one, what the heck kind of name is Cuppy's? Who wants to hang out at a place called that?
The name has grown on me, and I believe it will bcome part of entrepreneurial and franchise vernacular. People will say Dang, that Richard Quick Cuppied Me Again! or Their mama's gwin cuppy those boys but good! Trend watchers will declare being Cuppied is the new Munsoned.
Believe, deceive and succeed
Sean "My Cuppy's half full" Kelly
seankelly[at]ideafarm.net
Top New Franchises
Fairness to Dale Nabors
In fairness to Dale Nabors, he assumed control after this mess had been made and the money disappeared. Also, he seems to have placed the assets of his company (FranSynergy) at risk.
Those are arguably the actions of a fool, egotist, or man with really bad legal counsel (and Dale may be all 3).
But they are not indicative of someone committing fraud or trying to make a quick buck.
Paul Steinberg
Franchisee Attorney, New York City, Ph: 212-529-5400
Moved, Off Topic
This comment has been moved here because it is off the topic of the news article.
Dale Nabors did commit fraud...
Dale did take zee's $ after telling them he'd get them built out by so-n-so & that their $ would only go thowrd their project. Dale received $ but spent it on other things. Not their project.
DALE NABORS - QUIT DEFENDING THIS CREEP!
I've found out from a former member of the " Alabama Scheme Team," errrrrrrrrr I mean "Alabama Dream Team," that Dale Nabors was paying certain employees at Cuppy's Coffee to blog Robert Morgan. He was having them blog Robert Morgan with vicious lies to make him look really bad with any and all franchisees. This was being done by Dale Nabors before he ever stole Cuppy's. That's right people...STOLE. He wanted to come riding in on a white horese in shinning armour. He hasn't paid anything for Cuppy's, just a "song and a dance." THIS IS A BONAFIDE FACT! Another fact that I found out is...Dale is on these blogs daily defending himself as other people. THIS IS A BONAFIDE FACT! I know that Robert Morgan is no angel by any means, but next to Dale Nabors...Robert is Gabriel coming down from Heaven in all his Glory! Robert Morgan never stole a penny from anyone. He might have borrowed from Peter to pay Paul, but never did he steal or lie or committ FRAUD like Dale Nabors did. Now Mr. Admin, I know that you have given Dale Nabors the benefit of the doubts a number of times on here and tried to put everything on Mr. Morgan, but you were wrong. PERIOD THE END! What I am telling you now is Dale knowingly and deliberately committed outright FRAUD and he is going jail because of it. Morg never sent out BOGUS invoices to the SBA and the banks. Dale Nabors did and people now have definitive proof that this FRAUD took place numerous times. This has now gone from the Attorney General's Office in Florida to the Inspector General's Office and they are ON IT! This will take a little time but it's now in the system. Franchisee's keep your eyes open, because justice will prevail. And if you can believe it, Dale Nabors is still telling the same people he told 3 months ago..."It will be next week, and I will have the money." He will never get any money because everyone now knows what a SPINELESS, COWARD, THEIF, this sorry excuse of a man he really is... If you talk to Dale Nabors long enough you will see that he's not real bright. If you were to stuff his brain up a humming bird's ass, it would be like a peanut rollng around in a boxcar.
Follow the paper trail
My understanding is that during Morgan's ownership there were SBA monies disbursed and no buildout. Now, you say that Nabors also did this and the mechanism was submission of fake invoices to the lender.
Well... how did Morgan get the banks to give up the money? By virtue of his good looks? Morg can schmooze the pants off of gullible franchisees, but bankers are a tougher bunch and I suspect that Morgan and Dale got their money disbursed by the same method.
If you borrow from Peter to pay Paul, there is no problem with that. But if you pay Paul without getting Peter's permission, then you have a serious problem and a criminal one at that.
This is not about "defending" Nabors. It is about a realistic assessment of whose money was taken and who took it. Then we take up the question of how to recover the money.
From what I see, the evidence regarding Morgan is substantial and encompasses a lengthy time frame. From what I have been told by some zees and from listening to Michael Webster, it would appear that Nabors has strong evidence against him as well.
Bear in mind that in his interview with Janet Sparks, Nabors said that although Morgan had taken f'zee money and put it into the operating accounts, Nabors believed this practice to be unwise but lawful. As Webster has pointed out, the government is likely to disagree as to the lawfulness.
I would put the rhetoric aside, since it does not lead to a productive solution. At this point it is necessary to ascertain the amount of monies lawfully due to the franchisees ("depositor" and "build out loan disbursed" monies) and then determine how the creditors are to be repaid.
In all likelihood the creditors will get pennies on the dollar, but no way of telling until there is some proceeding, which is probably going to be in bankruptcy court.
Paul Steinberg
Franchisee Attorney, New York City, Ph: 212-529-5400
Fairness To Dale Nabors
"Fairness To Dale Nabors" Nobody held a gun to Dale Nabor's head and made him take over Cuppy's Coffee. Being very close to the situation, Cuppy's is much worse off after this "coward" took over the business. He runs from people, he is so spineless he doesn't even take phone calls from franchisee's or the AAFD. Read the article on all the Cuppy's Coffee bogs, "AAFD Suspends Accreditation Of Cuppy's Coffee" If Dale Nabors is so great, why was he hanging around and looking for a job with a franchise that was in trouble. He had no work and needed money. Now, I just wonder where the money is coming from that he will use to pay for Cuppy's??? BUYER BEWARE!
Believe (my lies) & Succeed (at going broke)
Do not agree
Dale stated that he had worked with the company for almost 7 months PRIOR to obtaining it, he knew what he was getting himself into and could have started fixing problems when he first started working with Cuppy's. Fairness to the Franchisees, not Dale.
Re: Do not agree: Correction...
Per several Cuppy's employees: Dale has 'worked' with Cuppy's since early 2007!
Dale
was a consultant. He had no authority to fix anything. He helped the franchisees with operational problems.
Re: Dale
Dale was not JUST a consultant. From my understanding in dealing with Cuppys and Elite, he was also trying to collect money from Franchisees who still owed money. A couple months before Dale bought the company he was supposedly fired for embezelment, I do not know how true this is but nothing was heard from him in some time from Elite employees in Angola, IN. Then next thing you know he is purchasing Cuppy's. I find this a little fishy.
Re: Re: Dale
“…supposedly fired for embezzlement”??? Are you on glue??? I find you a lot “fishy”!!!
Not True
I cannot believe that I just read this. It is so not true that it is laughable. Where do some of these people on here get these ideas? The definately are not in the know or purposely trying to make Dale look bad. Not gonna happen.............
Disregard That Comment
Is our guest from SBT, an angry entity suing Dale for not keeping the money flowing to their cozy club?
Anonymous.
Allegations of the worst kind.
Unsupported.
No logic.
This story has been covered for a very long time by many people who are involved with the company. We would especially know about any trespasses of Dale, an old member of Blue MauMau.
You say he was fired for embezzlement by the previous dubious characters, who then sold the company to him a couple of months later? Think through what you are saying. At least come up with something that is better thought out.
This is why guest posts are to be taken with a grain of salt. Actually, in this case to be stricken from the reader's brain.
And don't even bother replying.
Re: Disregard That Comment
Darnelle without anonymous malicious and unfounded comments where would we be here at BMM? We must support the rights of guest posters that will not subscribe anonymously to their absolute right to attack and misinform.
We must defy the Machiavelian notion on the status quo embodied in his statement "I come not to defend the status quo, but to destroy it" to the contrary we must uphold and honor the status quo it is the BMM Sacred Cow!
The Truth Shall Set You Free!
TIF
wait a minute
I do not understand this, where was he fired from? His contract with Cuppy's or Elite, which one and how true is this. This could certainly put a few things in perspective about Dale. I find it very hard to beleive that any person that had an ounce of common since whould pay a dollor for a failing company with very bitter franchicees. Why would that person, not take his or her money and take the concept and start a fresh new company that does not have all that baggage.
Dale, had a motive. I am not sure what it was, but I am sure it was not to spend the next upteen years trying to put out fires and solve world money problems for discruntal Cuppy's people. I often have wondered if Morg owed him money for his services and they just bargained out the money owed. I just can't imagine anyone paying for that company. Who knows, I sure don't!
Re: wait a minute
Typically a transaction such as this one would be an asset sale to limit liability and if this transaction was a stock sale you'd have to read the transaction documents to see how the current and future liabilities were handled. Who owns the downside from franchisee liabilities against the franchisor is a good question?
Additionally you'd need to know who the buyer was. If the the buyer was a sole purpose entity that has no personal guarantees that means that principals have a great deal of protection.
The Truth Shall Set You Free!
TIF
Re: Re: Dale
Oh did you not know that ALL franchisors are so duplicitous that when they discover consultant criminal activity they immediately terminate the current contract and look to rewarding the "criminal" by selling him the company or at least hiring the consultant as CEO?
I am surprised you did not know this commonly known franchising practice.
It's just how it is done!
The Truth Shall Set You Free!
TIF
Good point re Nabors
That should be true.
But from what I understand, Nabors was stunned by what he found in the first weeks after he took over. That is in accord with Nabors' longstanding failure to recognize the personal character of the key people with whom he was dealing (not unlike Mr. Purvin, who still seems to be hanging on to the rose-colored glasses notwithstanding valiant efforts of the AAFD board to pry them from him).
My understanding is that while a "consultant" to Cuppy's, Nabors was working on operational issues, and got some kudos from the zees for those efforts.
I agree with you that he should have suspected there was a situation which was at minimum a threat to survival and possibly even an ongoing fraud. A number of people outside the company thought there was hanky-panky and said so publicly.
SBT may have made a serious error in judgment by commencing suit, particularly given how their pleading was drafted. Already new information has come to light and it does not make SBT look good; in fact it may well give ammunition to attorneys for disgruntled "depositors" and franchisees of CuppysJavaJozMedinaSuperiorSBTEliteModularEmeraldcoast
We should be fair to all parties, in accord with their respective positions according to the facts.
I don't see any specific allegations indicating wrongdoing by Nabors, other than claims that Cuppy's/Elite is not paying their bills. And while that is a legitimate complaint, I very much doubt that Morgan left Nabors with much in the bank account. He did leave Nabors holding the bag.
Paul Steinberg
Franchisee Attorney, New York City, Ph: 212-529-5400
Re: Nabors' optician
Really? We never saw Dale Nabors wearing "rose-colored glasses" around the office or while meeting with Morg in Morg’s office which, by the way, was lined with glass. (read: see-through) Perhaps you are confused. You must be referring to that big magnifying glass he always carries around with him... the one that he was looking through as he searched through all the company financials.
Re: Good point re Nabors
If any of you have ever actually spoken to Mr. Dale Nabors you know he can talk for hours and never say anything! He was the only consultant I had ever spoken to that would just talk circles around the issue but never solve it. He made plenty of promises that were mostly not delivered upon though. Anyone that can do that much double talking to try and save face for the company had to know that there was something underneath! Do you really think he would have bought a company and not had everything fully disclosed??? I think not..he's not stupid. It would seem that his plan from the start was to start down sizing the staff..little by little, then with not trying to obtain any new Franchisees he would not have to worry about any newbie’s coming on. Get the ones open, "profitable" and then tank it all. Am I the only one that sees it going in that direction???
MBA-quality bsns plan
The Conspiracy Theory...
...oops, I mean TheBusiness Plan:
I don't know who is more stupid: Nabors for stepping in this mess, or "Guest" who can't come up with a logical conspiracy theory.
Paul Steinberg
Franchisee Attorney, New York City, Ph: 212-529-5400
Re:MBA-quality bsns plan
Paul my thoughts may not sound as pretty and rosy as yours about Dale and Cuppy's,but I wouldn't say they were stupid in the least.Bankruptcy would make everything go away.All the issues surrounding the company would be finished.How does anyone know for sure that he and Morg didn't talk this whole thing through so that Morg could escape unscathed too?I can assure you that Dale knew exactly what he was getting into.Now what people make out of that as far as reasoning goes is in their heads.I can just say that from where I am and what I have seen and heard,this is my conclusion..which I am perfectly entitled to.
-Stop selling new franchises, resulting in no new money coming in.-without new franchisees money coming in how would you suppose they were going to open the old stores since it is obvious there is NO MONEY!
-Open the backlog of sold franchises, incurring cost far in excess of short-term incremental revenue.-How could they do this?They couldn't even manage to keep product and/or ship ot for the store that are already open to use!Don't take my word..ask them!This is also one of the areas Dale was "Consulting" on so he knew about it.
- "Tank it all" while knowing that you have signed the infamous "Exhibit D", thereby pledging your heretofore legally-untouchable assets.-Please!What assests!!What do you think is left for goodness sakes!NOTHING!
Comprehension, "for goodness sakes"
Reading is a start, but actually paying attention to what you are reading is the big leap.
I have said that this quite possibly will end in bankruptcy with everyone currently involved (zees, "depositors", Nabors, vendors) getting screwed. If that is "pretty" and "rosy" to your ears, such lack of common sense might explain why you have such difficulty analyzing the current situation.
I have written ad nauseum about alter ego, piercing the corporate veil, fraudulent conveyance, etc. If you spent less time ranting and more time educating yourself, you would understand that a bankruptcy filing will not "make everything go away" (Unless the franchisees are lazy whiners unwilling to get legal counsel, which is certainly in keeping with their past behavior).
On 2 of my 3 points, you argue with me even though if you actually engaged the brain you would see that we are in agreement and that on those 2 points the evidence suggests that Dale Nabors is not in some giant conspiracy with Morgan.
I defer to you on the 3rd point as to the assets of FranSynergy Inc. I was going to take issue with your conclusory statement as to the value of the assets, but since you added "for goodness sakes" I am forced to acknowledge the accuracy of your analysis. You obviously have seen the books of FranSynergy Inc and subjected them to the utmost scrutiny or you would not be using such persuasive and dispositive argument.
Paul Steinberg
Franchisee Attorney, New York City, Ph: 212-529-5400
Re: MBA-quality bsns plan
How successful has Dale been in opening the backlog of sold franchises? When did the last cuppy's open?
Re: Re: Good point re Nabors
Direct answer:
NO! You are not the only one to see 'it' going in that direction.
Fairness to Nabors?
Believe me, Nabors was not beloved by franchisees.
As far as whether he's "someone committing fraud or trying to make a quick buck" let's be real.
He didn't get involved with this out of the goodness of his heart. He saw a shipwreck and thought he could act the savior and scavenge what the pirates had left behind. He may end up as the one walking the plank in their place
Not beloved by me either
I'm no fan of Nabors, for reasons not relevant here.
And he did indeed think he could salvage this mess. But let's face it: nobody else wanted this mess, and it certainly was not in the interest of anybody to see this collapse.
Your observation about "walking the plank" is true, and that is the one thing for which there is no rational explanation given the current facts. I have not heard from anybody who can explain why Nabors would sign "Exhibit D".
On the topic of loving, though: still laughing about the "Love Shack" of Angola.
Paul Steinberg
Franchisee Attorney, New York City, Ph: 212-529-5400
"Exhibit D"
What is this "Exhibit D" I see mentioned so many times??
Where to find Exhibit D
In answer to your Q:
"Exhibit D" was an addendum to the contract for the sale of LLC membership interest in Elite (when Dale Nabors' entity Fransynergy Inc bought the membership interest).
Then that page somehow would up in the possession of lawyers for an unrelated entity (Supreme Building Technologies) and those lawyers attached it to their Complaint in a suit alleging that Elite owed SBT money (why they put it in the Complaint is a matter of some conjecture, but that's another story).
You can see the pleading on the Unhappy Franchisee website, click here and follow the hyperlink to a pdf copy of the pleading; the appended exhibit pages number 15 in total and if you click here and go to page 6 of 15, you can read Exhibit D for yourself.
Paul Steinberg
Franchisee Attorney, New York City, Ph: 212-529-5400
Re: Get real Cuppy's
I understand how you feel. Now some people don't have homes because they can't pay their loans and stores are not producing at all. I feel the pain.
Re: Re: Get real Cuppy's
Yep, we are losing everything we have because of Dale FRAUD, Piece of Shit Nabors. He isn't. Has le lost anything? And....he was an actor on the soap opra "As The World Turns" in the early 80's.
EWWWWWWWWW, gross, can you imagine?????
Please allow me to correct
Please allow me to correct some of the lies in the Tngles Web comment. First you were not a consultant but the preferred vendor at that time for Java Jo'z and later Cuppy's. You did the cafe build-outs, did site work (or bid it out for GC's) for the modular buildings and was a liaison with R'Anell who actually built modulars for ECM or Elite at that time.
Concerning the site work for modulars, you told Java Jo'z/ Cuppy's licensees/ Franchisees you could do ALL site work for $30,000 and the actual cost for most was as high as $150,000. Some never opened their stores or were in dire straights opening because that was not in their budgets.
The reason you are no longer a preferred vendor was because too much was coming to light and you used Mr. Snowden's tax problems as an excuse to exit quickly, not because money was owed. You were paid by Elite because you stopped projects mid stream to make sure you got the money.
Elite paid for the projects you stopped a second time to ensure owners opened their stores. What else could Elite do but sue? You owed money to the general contractors you hired to do each of the jobs for site work and guess where they came to be paid? The owners were verbally promised many things from you at a specified price, but you rarely put anything in writing.
Take a look at the Elite website for the address, it has always been located in the same building as Cuppy's, but just as a tidbit, the franchisees knew this because when they got tours of the offices, the would meet the Elite staff.
For the record, Alvin Handshoe did incorporate SBT origionally so he could do the cafe build-outs to pick up where you dropped things, but in August 2007, he sold his shares and left. His name has been dragged through the mud for his past association. If licensees/ franchisees got their buildings or cafe's built out during that time, it is because this man worked overtime to make it happen.
Finally Allied Manufacturing is its own entity and is not in any way connected to Superior Canopy, Supreme Building Technologies, Modular Buildings of Monroe or Elite Manufacturing.
Allow You to Correct What?
You have been so very misinformed about what actually happened between our company and all the "players" in Florida. Let's take a wild guess here and say that all this info you stated came directly from someone at Java Jo'z/Cuppy's/Medina/Elite/ECM. Maybe you have no idea the amount of business that was promised to us and exactly what our scope of work was to be as a consultant or preferred vendor. We were always told one thing and the licensees and/or franchisees were told another. Java Jo'z/Cuppy's/Medina/Elite/ECM was always good at playing both sides of the street when it came to their vendors and their licensees/franchisees. The only people that ever truly made any money was the group in Fort Walton Beach, Florida.
We did stop mid-stream on projects only because we were owed money on previous projects we had already started for this group and the bleeding had to stop at some point. And, yes all this did coincide with Mr. Snowden's letter threatening bankruptcy if he had to refund anyone's deposits (plus his IRS problems). Wouldn't any smart business stop at this point as there was definitely going to be fallout from this situation and we should all remember the first rule of holes: When you find yourself in one, quit digging! Again, we are sure you have only heard one side of the story, unless you are a Java Jo'z/Cuppy's/Medina/Elite/ECM employee and if that is the case, we sincerely believe you have been brain washed into thinking that what you have stated is the truth by your "great employer". Please get help immediately!
You are right about one thing...Elite was always located in Fort Walton Beach because we met with them quite a few times and, yes, the franchisees that actually visited did meet them, but were they actually told that Cuppy's and Elite were owned by the same company, Medina Enterprises? We know they were told they had to use Elite as their preferred vendor for all their construction requirements, but we doubt they knew their money was all going into the same pocket (Medina). As we stated earlier, it states on Elite's website that they are located in Angola, Indiana. If this is not correct, someone at Elite should seriously update the website.
Finally, we do not know Alvin Handshoe, nor have we ever dealt with him, Allied Manufacturing or Supreme Building Technologies, but we didn't fall off the turnip truck yesterday either. We know when we smell a rat!
Re: Allow you to correct what
So since you admit never having dealt with Alvin or SBT...you should keep you comments about them to a minimum. As most of the others out there right now they got just as screwed by the Medina "umbrella" as everyone else. It doesn't take a rocket scientist to see that. It would seem you could understand the dilemma a little better considering you were one within the circle too.
Contractor
I believe that guest is referring to MCSI, the company who Elite used before SBT.
Note guest says: " Maybe you have no idea the amount of business that was promised to us and exactly what our scope of work was to be as a consultant or preferred vendor."
I believe that this technique is a favourite sales technique, bordering on misrepresentation.
Michael Webster PhD LLB
Franchise News
Re: Contrator
That sounds about right. Did anyone ever see the crap work they did! My goodness I know children that could do a better job then that!
I didn't get just one thing right
No brain-washing here. You were promised many projects but so many complaints were coming in concerning previous jobs and the site work, the company needed to find someone else. Why didn't you address the site work you promised for $30,000 a project?
What's one more name?
"You have been so very misinformed about what actually happened between our company and all the "players" in Florida."
You're giving enough info about your company... why not refer to it by name? I need it for my new project: the Cuppypedia
Sean Kelly
seankelly[at]ideafarm.net
Franchise Pick
Franchisor Marketing
Guess who
Sean, the "Guest" named most of the players, but not Emerald. As I recall, weren't there 2 distinct entities both called "Emerald" which were involved in the construction by Snowden and Morgan?
Another way to spend the funds raised by our "charity" will be to hire the freshman class at Parsons School of Design to draw a flowchart of these Cuppy "players"
Once the flowchart is done, we could take bets on where along the flowchart all the millions of dollars disappeared. Winner would be determined once the "players" are sentenced.
It is a shame that Bororian is no longer a guest at Club Fed--the IFA could arrange for the "players" to get the CFE designation with Bororian as their tutor. When the "players" got released, they could give a seminar at the Washington IFE Expo.
Paul Steinberg
Franchisee Attorney, New York City, Ph: 212-529-5400
Cuppypedia - is that a prosthetic device for use when
molesting children? I can see that in the next Batman movie - "and then Joker whipped out his Cuppypedia and rubbed it with K-Y......--
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
Cuppypedia definition 3
I thought it was a form of truss to keep enterprising fellows from getting herniated whilst carrying away large sums of other people's money. But yours sounds right, too.
Sean Kelly
Chairman , 1511 Wohlert Preservation Committee
seankelly[at]ideafarm.net
Unhappy Franchisee
Allied
http://www.insideindianabusiness.com/newsitem.asp?ID=29120
Allied has a lot of similarities here:
-Building Modular and On-site Construction Projects, specifically franchise companies.
-Based in Angola, IN
-Receiving tax credits from IN
My question to 'truth' is, is Allied doing build-outs for Cuppy's?
No work is done for Cuppy's
No work is done for Cuppy's
Re: No work is done for Cuppy's
Is any work done for Elite?