The CGL situation p3 Options

[MindandPen]

Well yeah I get that. lol.

But the original question remains. Dude stole 1,000s or 10,000s from the company. He needs to see the inside of a cell.

Depends on how you define theft. As a private company, CGL plays by a different set of rules. Someone mentioned "co-mingling of personal funds". If that is what happened, then it could be that it is not theft, that would depend n a lot of things and I am not a lawyer. In my experience, it would be more likely to be a tax issue, but again, I don't work for the Government.

-M&P

[Pepsi Jedi]

Come on. Lets be honest. It's not a 'tax issue'. Dude took the money and got busted. Money's gone and people aren't getting paid. Throwin' "Tax issue's" into this only obfuscates what really happened.

[Ancient History]

Our collective (summary) Wild Ass Guess of what has/is happening follows:

There's a couple wee misconceptions here I'd like to point out.

This brings us to the recent disclosures and problems with paying people. CGL needs money for the license renewal and fixed bills, so the easy place (in their mind) to cut was the freelancers and salaries.

The big problem here is that the problems with freelancers have been very long-running - way before the financial mismanagement was "outed," and in some cases going back years.

So, the owners do the following:

1) Keep everyone in the fold, so as to continue to get restitution from them and show that they are a going concern. The terms of the LLC could also make it difficult to remove one of the owners.
2) Implement controls and procedures that satisfy TOPPS that they have their operations under control. The troublesome owners are neutralized, everyone is watched and accountable, and a plan is put into place to right the ship.

We already know that the "troublesome owners" aren't neutralized, because Loren's still in charge. (IMG:style_emoticons/default/smile.gif)

[tweak]

We already know that the "troublesome owners" aren't neutralized, because Loren's still in charge. (IMG:style_emoticons/default/smile.gif)

I was thinking about this some more. Are the freelancers that provide fiction to BattleCorps being paid?

[MindandPen]

Come on. Lets be honest. It's not a 'tax issue'. Dude took the money and got busted. Money's gone and people aren't getting paid. Throwin' "Tax issue's" into this only obfuscates what really happened.

That is not the question, the question is what can be proven in a court of law, either criminally or civilly. Tax laws are, historically, the easiest to prove in criminal court. Look at Al Capone for a notorious example.
I agree with what you are saying, my only point is that if you are expecting to see someone in jail, that may not happen, because technically (based on what has been presented), they did not steal anything, they just took more of their share than they were supposed to. This is why tax lawyers get paid what they do, and why things like LLC's exist, because those technicalities are the difference between jail time, and bad business.

Disclaimer: I am not a lawyer, this is only my opinion.

-M&P

[MindandPen]

We already know that the "troublesome owners" aren't neutralized, because Loren's still in charge. (IMG:style_emoticons/default/smile.gif)

But what we don't know is what that will look like going forward. It is possible that the "new procedures" we hear about will, in effect, neutralize his power while allowing him to repay what he owes from within the structure. He could then be removed by a change in the LLC structure. I've seen that happen before, as it is cleaner from the standpoint of the other owners.

-M&P

[MindandPen]

The big problem here is that the problems with freelancers have been very long-running - way before the financial mismanagement was "outed," and in some cases going back years.

I've noticed that comment made throughout. Am I correct in assuming that it was common as far back as FASA? If so, is this common with other RPG's, or just a Shadowrun ownership "curse"?

-M&P

[Ancient History]

I was thinking about this some more. Are the freelancers that provide fiction to BattleCorps being paid?

My understanding is very few people, relatively speaking, are being paid at this point, and the BattleTech folks are owed more and for longer periods than the Shadowrun folks. I cannot state unequivocally that is the case, since I don't have CGL's finances, but that is my understanding.

But what we don't know is what that will look like going forward. It is possible that the "new procedures" we hear about will, in effect, neutralize his power while allowing him to repay what he owes from within the structure. He could then be removed by a change in the LLC structure. I've seen that happen before, as it is cleaner from the standpoint of the other owners.

While I have no doubt that the owners hope for Loren to pay it back, my understanding of Loren's position from Randall's letter to the freelancers is that he's not going to be surgically removed from the checkbook anytime soon.

[Demonseed Elite]

I've noticed that comment made throughout. Am I correct in assuming that it was common as far back as FASA? If so, is this common with other RPG's, or just a Shadowrun ownership "curse"?

Yes, it has happened as far back as FASA. I don't know the answer to the second part, as I've only written for Shadowrun.

[MindandPen]

While I have no doubt that the owners hope for Loren to pay it back, my understanding of Loren's position from Randall's letter to the freelancers is that he's not going to be surgically removed from the checkbook anytime soon.

That would require, based on my experience with LLC's, a change in ownership. My guess (based on JHardy's comments) is that the new procedures require all the owners to sign checks, thereby limiting the damage in the short term. Long term, we may see Loren removed after he pays the other owners back. I think the threat of whatever consequences, along with group control over the checkbook and all operations, is what the other owners are hoping will keep him in line and keep TOPPS happy.

I could also be completely wrong.

-M&P

[MindandPen]

Yes, it has happened as far back as FASA.

Okay, that is just messed up. My respect for the writers who have contributed to this universe to date continues to grow as more of how the sausage is made is exposed.

-M&P

[tweak]

That would require, based on my experience with LLC's, a change in ownership. My guess (based on JHardy's comments) is that the new procedures require all the owners to sign checks, thereby limiting the damage in the short term. Long term, we may see Loren removed after he pay's the other owners back. I think the threat of whatever consequences, along with group control over the checkbook and all operations, is what the other owners are hoping will keep him in line and keep TOPPS happy.

I could also be completely wrong.

-M&P

Can someone help me with the history thingy? I thought Loren started up BattleCorps as a monthly subscription for continued BattleTech fiction. Then, when FanPro died, he started up Catalyst and brought Battletech RPG and Shadowrun RPG under that business. So he still should be seeing cash flow from BattleCorps. Or did that business (InMediaRes) financials get mixed up with Catalysts and his own?

[Warlordtheft]

Well yeah I get that. lol.

But the original question remains. Dude stole 1,000s or 10,000s from the company. He needs to see the inside of a cell.

Drek...I said I wasn't going to post anything more on this topic but slot it!!! But your fragging bulldrek of a post forced me to post to give everyone the real paydata. Especially the chummers from overseas who have a different set of biz laws.

LLC: Limited liabilty corporation=partnership with one or more principals. AKA=multiple owners. Not a corporation, not stock, no IPO, and is not traded publicly. Secondly, there are no tax issues as the LLC's income is not taxed. The income the partners get from the LLC (the profits, is)

At worst all the one owner did was break a contract which can be settled via arbitration or lawsuit. The partners chose arbitration. This arbitration may involve a reduced salary, limited share of the profits, or it could convert into a loan to be paid back to the partners. We don't know, and we don't have a right to know since it involves the personal finances of the owners.

Sort of like Aztechnology, which is a private corporation.


PS:Bring back the slang (IMG:style_emoticons/default/smile.gif)

[Pepsi Jedi]

Drek...I said I wasn't going to post anything more on this topic but slot it!!! But your fragging bulldrek of a post forced me to post to give everyone the real paydata. Especially the chummers from overseas who have a different set of biz laws.

LLC: Limited liabilty corporation=partnership with one or more principals. AKA=multiple owners. Not a corporation, not stock, no IPO, and is not traded publicly. Secondly, there are no tax issues as the LLC's income is not taxed. The income the partners get from the LLC (the profits, is)

At worst all the one owner did was break a contract which can be settled via arbitration or lawsuit. The partners chose arbitration. This arbitration may involve a reduced salary, limited share of the profits, or it could convert into a loan to be paid back to the partners. We don't know, and we don't have a right to know since it involves the personal finances of the owners.

Sort of like Aztechnology, which is a private corporation.


PS:Bring back the slang (IMG:style_emoticons/default/smile.gif)

As colorful as you are, it doesn't change the fact. Try and gloss over it all your want. Call it something else if you want. Cover ass if you want Chummer. But the guy took money that didn't rightfully belong to him. He STOLE IT. He didn't find it in a sack on the street with a dollar sign painted on the side. He went in and took it. He knew it wasn't his. You don't make mistakes to the tune of THOUSANDS of dollars, bottoming out your companies bank account by accident. He knew what he was doing. It takes forethought and will to purposefully steal money like that.

He's a THIEF.

Stealing money is illegal.

He's entered into contracts with people for services. Those people (( the freelancers )) provided their services. Their work was accepted. More over, in many cases it saw print, and made money.

He did not fulfill his end of the contract. He willfully took the money and spent it. This isn't 'oh he just took a bit extra'. He defrauded the company. He embezzled funds. (( as much as you might like to think, partial owners of companies can't just pocket the profits and go blow it on hookers and blow if they want to. There's law to hold them accountable to the company and those they're in contract with.)).

As soon as that work went to print, and hit stores and made a DIME, he's criminally responsible for the actions.


So sit back. Laugh it up and make it sound like dad took the allowance of the money HE made away from his kids.

Truth is he's a thief that stole $1,000s of dollars from hard workin' people. He should be ashamed of himself. And he should do jail time for the crime. Trying to Sugar coat it doesn't change what really happened. These writers aren't pulling the copy write just for shits and giggles. The company was making money off their work and refusing to pay them. Pretty sure that's illegal in some fashion too. (( hince them pulling the copy write till they're paid.)) At the very least, he stole money from the other owners. And put them on the line for the litigation that follows.

[Shinobi Killfist]

Just want to say one thing before people get all pissy again.

Allegedly.....

Remember folks you are innocent until proven guilty in this country. Whether a crime even was committed depends on a lot of facts no one here is even privy to, and whether a person is or is not guilty of alleged crimes(by random internet poster with no info #5) is something I'll leave up to a court of law if it ever reaches one.

[Adam]

Can someone help me with the history thingy? I thought Loren started up BattleCorps as a monthly subscription for continued BattleTech fiction. Then, when FanPro died, he started up Catalyst and brought Battletech RPG and Shadowrun RPG under that business. So he still should be seeing cash flow from BattleCorps. Or did that business (InMediaRes) financials get mixed up with Catalysts and his own?

InMediaRes Productions, LLC, is the company that Loren co-owns. Catalyst Game Labs is simply a brand name that the company uses for game-related products. BattleCorps is another brand name, for their BattleTech fiction site. Holostreets is ... hey everyone, stop laughing! (IMG:style_emoticons/default/biggrin.gif)

[tweak]

InMediaRes Productions, LLC, is the company that Loren co-owns. Catalyst Game Labs is simply a brand name that the company uses for game-related products. BattleCorps is another brand name, for their BattleTech fiction site. Holostreets is ... hey everyone, stop laughing! (IMG:style_emoticons/default/biggrin.gif)

Nice one. I thought Catalyst Game Labs was a separate entity. Thanks for clearing that up. Oh, yeah, I remember the Holostreet t-shirts at GEN CON.

[Redjack]

I'm pretty sure there is a bylaw somewhere that states that inciting a thread about Holo-{You know what} is a ban-able offense.

*Runs off the check mod bylaws*

[emouse]

"One of the owners embezzled company money on a massive enough scale so that, a NUMBER of writers have not been paid and now books are being held and taken off shelves and offline.

Why isn't he in jail?"

What little I've picked up about LLCs (and mind you I am not a lawyer or accountant) indicates that the LLC is considered the private property of the owners. Any taxes are paid by the LLC, so the owners are not double dipped on taxes, and what's left belongs to the owners.

The problem in Catalyst's case is that the account used for CGL's funds was also the personal account of one of the owners, giving one of the owners an inordinate amount of access to those funds.

When the LLC was established there would have been a contract established dictating how that pool of funds was to be divided among the owners.

Because the distribution of those funds was not in accordance to the contract, it's a contractual dispute among the owners. It's up to them whether to take up the matter legally.

While the payment to freelancers was likely impacted by the misappropriation of funds, they also have a contract with CGL as an entity, not with the specific owner at fault. Those contracts apparently stipulate payment 30 days after publishing. Since the material being paid for is written, copyrightable work, the easiest avenue for freelancers to pursue is to withhold copyright until paid. In the cases where this has been used, CGL has appeared to make a good-face effort to stop sales of the material involved. If they hadn't stopped sales, it would have made a good case for the freelancer to legally pursue them on copyright infringement, as it would have been a very blatant act at that point.

[Cain]

According to Frank's original post, CGL lost a total of $850,000 over three years from various sources. Take that number with a grain of salt; Frank has proved himself reliable, but we don't know where he got those numbers from. Jennifer Harding has hinted that Franks's numbers are correct; but again, that's not a verifiable fact.

As for why Loren isn't in jail, you need the other owners of IMR to agree to sue. At least one, Randall Bills, has stated that he instead chooses to stand by his friend. We don't know what the other owners think, or if they even have the ability to vote Loren out. They may feel that t he best way to get their money back is to work with Mr. Coleman.

[LurkerOutThere]

Just want to say one thing before people get all pissy again.

Allegedly.....

Remember folks you are innocent until proven guilty in this country. Whether a crime even was committed depends on a lot of facts no one here is even privy to, and whether a person is or is not guilty of alleged crimes(by random internet poster with no info #5) is something I'll leave up to a court of law if it ever reaches one.

I'm glad someone posted this so i didn't have to, furthermore do you know that the catch and punishment rate on murder is only about 60% and is substantially lower for non violent crime, so the chances of a theoretical perpetrator seeing the inside of a theoretical cell for embezzlement is rather low. Keep dreaming though.

[Kid Chameleon]

As for why Loren isn't in jail, you need the other owners of IMR to agree to sue.

Suing would be civil litigation, separate from criminal litigation.

[Ancient History]

I'm glad someone posted this so i didn't have to, furthermore do you know that the catch and punishment rate on murder is only about 60% and is substantially lower for non violent crime, so the chances of a theoretical perpetrator seeing the inside of a theoretical cell for embezzlement is rather low. Keep dreaming though.

I have no idea what you think the statistics for an unrelated type of crime have to do with the situation at hand (well no, that's a lie, I can fairly well intuit your intention, your quoted stats for murder just have bupkis to do with embezzlement or fraud). I would also remind you that by CGL's own press statement it's been admitted that there was financial mismanagement at the top. The only question remains the criminality of it.

[kzt]

I've noticed that comment made throughout. Am I correct in assuming that it was common as far back as FASA? If so, is this common with other RPG's, or just a Shadowrun ownership "curse"?

Lots of people in the gaming industry are not professionals. This includes the people running the company. And most gaming companies are tiny. I think Chaosium had 6 employees at it's peak. GDW about the same. HERO maybe 6 at most. West End and TSR were both decently sized and fairly professionally managed - but you'll notice they both both blew up and sank, iirc over cash flow.

Putting out product takes money and very few RPG companies can get bank loans to do that. Licenses are even worse - as there is a lot of money and control issues that go along. The old James Bond from Avalon Hill, where AH could never get the final approval from the license holder to put out new products.

[LurkerOutThere]

Most people whould say murder is fairly serious and it only sees a conviction 60% of the time, but you likely figured that, as far as the criminality of it there may effectively be none.

I'm not a lawyer and I was only nominally a cop, however in order to make a criminal complaint stick you have to have a harmed party to file and then enough follow through to convince the actions weren't just mismanagement but criminal.