Irving Gould vs. The World

[hishamk]

http://stoneridgepartners.biz/principals.htm

I've mentioned this before...it seems Mehdi is in two places at once...

http://meridianassociates.biz/professional.htm

.biz domain names always come out sounding tacky IMHO.

[ShapeShifter]

I don't get how they can be sued personally for debts owed by a corporation that used to employ them, where no crime is alleged.

If it can be proven that they were acting in a completely self-serving manner, running the corporation solely for their own benefit, taking advantage of shareholders, evading proper scrutiny, or doing secretive things which are actually harmful to the interests of the shareholders, etc. then can be sued for gross misconduct/negligence/etc.  There's a lot out there to suggest that's precisely what they were doing, even long before 1993-94:

http://articles.philly.com/1989-11-03/business/26140777_1_thomas-rattigan-irving-gould-commodore

Commodore should be the law school poster child for dubious corporate governance. Well, right after Amiga Inc. Tomes could be written about this.

Definitely. From what I've gathered about Commodore's corporate governance, there are a lot of very pertinent questions which still need to be answered.  Like why the principals awarded themselves massive pay rises when it was clear the company was taking a turn for the worst financially, or why they moved all the financial operations to the Bahamas, when most shareholders lived in the States and the Bahamian laws were less favourable to shareholders, etc.

That's what you call a 'major turnaround'.
http://stoneridgepartners.biz/principals.htm

I always laugh out loud when I see this. Though technically, he's correct.  C= were doing quite well, and he totally tanked the company in the space of a few years. That is INDEED a major operational turnaround! :roflmao:

I've mentioned this before...it seems Mehdi is in two places at once...
http://meridianassociates.biz/professional.htm

I think it's going to take more than a couple of tacky .BIZ websites to revive Medhi's career.  He might do well to change his name by deed poll, as anyone thinking of taking him on would immediately change their minds after a brief glance at the Google matches on his name. :lol: Talking of which, comment from http://weblogs.mozillazine.org/kovu/archives/007699.html:

Mehdi helped destroy the next project he was involved in... a company I was the CFO in until he became involved and "created profits for the short run"...not for the future of the company

[hishamk]

Just a head's up that the correct spelling is Mehdi, not the oft-misspelled Medhi.

As for what the name means, brace yourselves... it means "rightly guided".

[Tension]

Just a head's up that the correct spelling is Mehdi, not the oft-misspelled Medhi.

As for what the name means, brace yourselves... it means "rightly guided".

rightly guilded more like!

[Matt_H]

I've mentioned this before...it seems Mehdi is in two places at once...

http://meridianassociates.biz/professional.htm

.biz domain names always come out sounding tacky IMHO.

It's the exact same company! Did they change names and forget to take down the old site, or are they up to no good? I suspect the latter.

Come to think of it, Mehdi Ali is a common enough name that he could easily dissociate himself from his colossal failure at Commodore. Why on earth would he call attention to it?!

[weirdami]

I've mentioned this before...it seems Mehdi is in two places at once...

http://meridianassociates.biz/professional.htm

.biz domain names always come out sounding tacky IMHO.

Just wait until the .xxx domains start appearing.

[ShapeShifter]

For those who haven't had the time and/or stamina to wade through these hefty court filings, here's a brief summary of what I've been able to piece together.  I

[from http://174.123.24.242/leagle/xmlResult.aspx?page=1&xmldoc=2001358262F3d96_1350.xml&docbase=CSLWAR2-1986-2006&SizeDisp=7]

...On or about March 26, 1997, the Liquidators [..] consented to the Creditors' Committee's pursuing Commodore's claims for fraud, waste and mismanagement against the defendants, various former officers and directors of Commodore

The plantiff is listed as Commodore International itself, Commodore Electronics Ltd, and the creditors of Commodore.  The defendants in this case are listed as: Irving Gould, Mehdi R. Ali, Alexander M. Haig, Jr., Ralph D. Seligman, Burton Winberg, J. Edward Goff, Hock E. Tan, Ronald B. Alexander, and Anthony D. Ricci.

So in other words, those folks Commodore owed the dosh to, as well as Commodore itself as a corporation, are suing the officers for dirty misdeeds which they 'allegedly' performed during their time at the helm of C=.  Rather inconveniently for the creditors, Irving Gould passed away before this case was settled, so the claims continued on against his Estate instead.   They're charging the defendants with gross mismanagement, fraud, and waste.  There were two live cases on this issue being perused against the directors: the first in New York, with the other in the Bahamas.  Both these cases were live as late as 2001, but from what I've been able to piece together, the case filed in New York has been dismissed on the grounds a similar case was being pursued against Commodore at the Bahamas Supreme Court.  That Bahamas case is scheduled to go to trial 'late in 2011', and the creditors are suing for $100 million in damages:

[from http://www.oakbridgeins.com/clients/blog/commodore.pdf]

Since filing for bankruptcy, Commodore and its officers and directors have been named in a variety of lawsuits in jurisdictions throughout the world. (Id. ¶ 39.) All of these lawsuits have been resolved except for a pending action in the Supreme Court of the Commonwealth of the Bahamas, in which the plaintiffs seek damages in the amount of $100 million (the “Bahamas Litigation”).  To date, Defendants have incurred approximately $14 million in losses as a result of the various lawsuits.

The plaintiffs in the Bahamas Litigation are seeking $100 million in damages ... Defendants have already incurred approximately $14 million in losses ... [the] trial in the Bahamas Litigation is scheduled to commence by the end of 2011

In addition, the insurance taken out by these directors - presumably meant to absolve them from having to pay out of their own pockets if they should be found guilty - isn't sufficient to fully protect them.  The insurance was underwritten by a number of different firms, which each underwrote a different 'layer' of the insurance protection -- and many of those firms have now gone out of business.   As a result, the court in that case has ruled that the remaining insurance firms aren't responsible for paying out any claims in the other layers, which would have been the responsibility of the bankrupt firms:

[from http://www.oakbridgeins.com/clients/blog/commodore.pdf]

At the time of its bankruptcy filing, Commodore had in place a directors and officers liability insurance tower totaling $51 million in coverage provided by six different insurance companies through nine different policies (the “Tower”)......

......In 2001, prior to Defendants’ submission of claims pursuant to the excess policies, Reliance Insurance Company (“Reliance”) was ordered into liquidation at the request of the Pennsylvania Insurance Department. Subsequently, in 2003, the Home Insurance Company (“Home Insurance”) was ordered into liquidation at the request of the New Hampshire Insurance Commissioner. Because of the insolvency of Reliance and Home Insurance, Defendants will not be reimbursed for claims filed under the first, third, and fourth-layer excess policies.

This all means that, should the directors be found guilty of fraud, waste, mismanagement, they'll probably have to cough up at least some of the damages out of their own pockets, rather than making the insurance firms pick up the tab.

And so the unresolved story of Commodore's liquidation continues... a full 17 years after that fateful day in April, 1994...

[Matt_H]

Fascinating stuff. I'm glad someone's still hounding C='s managers, even if it is just boring creditor groups.

[ShapeShifter]

Fascinating stuff. I'm glad someone's still hounding C='s managers, even if it is just boring creditor groups.

Oh, me too! It's strangely reassuring, isn't it? :lol:

I must admit, I thought that from a legal standpoint the sell-off to Escom would be the end of the matter; that despite their ineptitude, directors like Irving Gould could simply fade away into their holiday homes near the lush warm beaches of the Bahamas, and be forgotten by history; and even Mehdi Ali would somehow be able to continue his lifelong quest to 'turn around' companies (even if his approach to doing so is somewhat novel; he really should be more clear in his marketing literature that he's talking about turning successful companies into failures!)

During 1994-95, to my knowledge there weren't any lawsuits pending against Commodore.  Commodore owed money, they were being liquidated to raise as much money as possible to pay off as much of that debt as possible, and once it was all over, that would be it.  I didn't ever imagine that, having been liquidated and successfully sold off, someone could then come along and 'sue' Commodore's directors, several years later...

Even more surprised to see that these lawsuits are still ongoing, 17 years after the company went bust! It just boggles the mind, really.  It seems very peculiar, but is it? Is this sort of thing very common? I wonder..

I'll be very interested to see how this Bahamian trial turns out, though.  We in the Amiga community have always accused the directors of being up to no good, yet I don't think any of us ever imagined they'd actually be raked over the coals for it.  I think we just assumed that everything they did was perfectly legal, and had been resolved by the liquidation and/or the creditors not taking any other action back then.