Intellivision Amico’s trademark changed to ‘abandoned’

[Cebus Capucinis]

Ah, yeah, that was my mistake. IE hasn't been joined or sued. TT's counsel.

 

Not to get into depreciation, but I'm sure there's probably an expected life of the equipment and some straight-line you could do, but it doesn't really matter because the "market" isn't going to suss out at exactly where the depreciated items are anyway. It would just be a guidepost.

 

I've done a couple UCC sales back in my creditor's rights litigation days, and I can tell you that $6k for what was financed at $180k on a sale for office equipment 18 months later is not unheard of, especially in COVID world where the economy is still reeling. It's probably on the low side but still in the ballpark of "what to expect for this stuff with zero buyers and a soft market plus liquidated office furniture," but I suspect the $180k was massively overpriced in the first place, and the real "new" value was probably half that as is.

[Rev]

4 hours ago, Matt_B said:

According to the original lawsuit, they defaulted on the loan in July 15, 2022. This was well after the "unboxing" video was released, so no shenanigans there.

 

I wouldn't be surprised if only some of the furniture was recovered because they'd have also had to vacate their offices and fire most of their employees at around the same time.

Where is the documents that show July 15 2022

[Matt_B]

29 minutes ago, Rev said:

Where is the documents that show July 15 2022

The original court docs (behind a paywall) are available here:

 

https://unicourt.com/case/ca-ora-amur-equipment-finance-inc-vs-intellivision-entertainment-llc-1241254

 

Handily, someone posted the text of it on Reddit:

 

 

[kevtris]

You can read exactly what tommy agreed to.  the contract is posted here:

https://imgur.com/a/2haO1i9

It's exhibit 1.  unfortunately the scan is kind of crap, but you can read it. 

 

The 5-6 grand they got for everything is really low, but there's probably a huge glut of office furniture.  All those companies closing offices thanks to work from home were probably selling off all the office furniture they no longer need, so it was probably the absolute worst time to try and unload all that stuff.  Coupled with the fact they got teal chairs to colour-coordinate with their office, those probably will be much harder to move than say, grey or black chairs.

 

All that stuff is big, bulky, hard to transport, and takes up massive space so clearing it out ASAP means you're going to be taking a massive loss.  The market for pre-farted in chairs right now has to be absolutely tiny and the supply's gotta be yuuuge.

[kevtris]

I was reading through it and some choice parts:

 

right above the part tommy signs as personal guarantor:

 

"The undersigned (each, a guarantor) personally, absolutely, unconditionally, jointly, and severally (if more than one guarantor) guaranty all payment and performance obligations of customer under the EFA with the above-referenced contract number to us and our successors and assigns.  Unless expressly defined herein, all defined terms shall have the same meaning ascribed to them in the EFA.  We may proceed directly against any guarantor without first proceeding against the customer or collateral."

 

Basically, tommy is 100% on the hook, and Amur does not have to go after Intellivision first.  They can go after tommy first if they want.

 

 

The remedies section (#13) explains exactly what will happen in the event of a default, and section 12 specifies what a default is. 

 

some other fun things are section 18, which states that "any controversy, claim, or breach related to this contract may be settled by arbitration according to the laws of the state of nebraska and any judgement upon the award rendered by the arbiter(s) may be entered in any court of jurisdiction.  Arbitration shall be held in the state of nebraska"

 

and section 19, waiver of jury trial.  "each party hereby irrevocably waives the right to trial by jury of any cause of action, claim, counterclaim, or cross-complaint in any action or proceeding to which it may be a party regarding any matter whatsoever related to this EFA, any other contract documents, any guaranty, software, data, and/or collateral"

 

 

 

[roots.genoa]

I wish I understood a single word of what your guys are explaining, it sounds interesting. 😩

Acronyms like UCC and EFA don't help, but lawyer talk is as cryptic in English as it is in French apparently. 😔

[Biff Burgertime]

3 hours ago, kevtris said:

Coupled with the fact they got teal chairs to colour-coordinate with their office, those probably will be much harder to move than say, grey or black chairs.

 

Maybe you could help them out and buy one of those teal chairs. It'd match your teal avatar. 

 

Just draw the rest of the Hummer Team logo(right?) on the cushion with a sharpie, viola!

[kevtris]

55 minutes ago, roots.genoa said:

I wish I understood a single word of what your guys are explaining, it sounds interesting. 😩

Acronyms like UCC and EFA don't help, but lawyer talk is as cryptic in English as it is in French apparently. 😔

I was going to put in what EFA meant but forgot, actually.

 

UCC is "uniform commercial code"

"The Uniform Commercial Code (UCC) is a comprehensive set of laws governing all commercial transactions in the United States. It is not a federal law, but a uniformly adopted state law. Uniformity of law is essential in this area for the interstate transaction of business. Because the UCC has been universally adopted, businesses can enter into contracts with confidence that the terms will be enforced in the same way by the courts of every American jurisdiction. The resulting certainty of business relationships allows businesses to grow and the American economy to thrive. For this reason, the UCC has been called “the backbone of American commerce.”

 

EFA is "equipment finance agreement" (aka "the contract" in this case)

43 minutes ago, Buffalo Biff Burgertime said:

 

Maybe you could help them out and buy one of those teal chairs. It'd match your teal avatar. 

 

Just draw the rest of the Hummer Team logo(right?) on the cushion with a sharpie, viola!

and yes indeed, it is the hummer team logo!

 

[number6]

7 hours ago, kevtris said:

The 5-6 grand they got for everything is really low, but there's probably a huge glut of office furniture.  All those companies closing offices thanks to work from home were probably selling off all the office furniture they no longer need, so it was probably the absolute worst time to try and unload all that stuff. 

Spot on.

In turn many of the very owners of these office spaces are declaring bankruptcy after losing their cash flow from tenants who no longer exist. So even those who used to have a need for said furniture to repurpose to others, no longer have even that option since they also are out of business.

This all sounds similar to the failure of IE to pivot when the pandemic struck. I suppose they could argue that outside conditions in the world have thwarted them at every turn. *shrug*

 

Interesting bit from a few days ago that may or may not apply in the future:

Quote

Supreme Court rules 9-0 that bankruptcy filers can’t avoid debt incurred by another’s fraud

 

#6 

Edited February 26, 2023 by number6
Added reference

[MrBeefy]

I'm loving all this talk. There's one thing I do just need to know.

 

 

Did the furniture company also mistakenly sell the FCC certs? Because you know IE had them, but have been sitting on them for so long.

[Cebus Capucinis]

8 hours ago, kevtris said:

We may proceed directly against any guarantor without first proceeding against the customer or collateral.

Ah, there it is! Yeah, this is an enforceable provision and there's no real argument to be made that they failed to pursue remedies against the debtor and collateral first. Affirmative Defenses Eight (or was it nine?) probably holds no water. The lender can simply argue "plain language of the contract you agreed to."

 

While I'm interested, I'm still sticking to my guns and not reading any of it - I do that enough at least 5 days a week.

 

I'm assured there's entry without judicial process in the remedies, collection of the collateral, then sale either on no notice or with limited notice, which the parties agree is commercially reasonable. (Maybe there's not, but it would be surprising).

[jerseystyle]

I’ll never understand why IE went this route. As I said on the Reddit (and to TT himself when he did the first office tour): this was a complete waste of money and resources. They could’ve rented out a floor at a WeWork, or something similar. Those companies let you do 12 month contracts, provide EVERYTHING you would need, and you can customize the space to make it your own. I’ve worked with entire schools that operated this way, even during Covid. Their only responsibility is paying rent in time. It’s the perfect route for a startup because you can pivot (scaling up or down) as needed quickly. When I spoke to TT about this he blew off my suggestion and implied I don’t understand business. Good times. 

[kevtris]

3 hours ago, Cebus Capucinis said:

Ah, there it is! Yeah, this is an enforceable provision and there's no real argument to be made that they failed to pursue remedies against the debtor and collateral first. Affirmative Defenses Eight (or was it nine?) probably holds no water. The lender can simply argue "plain language of the contract you agreed to."

 

While I'm interested, I'm still sticking to my guns and not reading any of it - I do that enough at least 5 days a week.

 

I'm assured there's entry without judicial process in the remedies, collection of the collateral, then sale either on no notice or with limited notice, which the parties agree is commercially reasonable. (Maybe there's not, but it would be surprising).

it sure does.

 

"upon the occurrence of a default, we can elect to declare you in default of this EFA and any other contract document, and exercise cumulatively any or all of the following remedies without notice to you or any guarantor:  (a) require you to pay us the sum of the following amounts <basically the entire amount due, and penalties and interest>.   (b) require you to immediate surrender the collateral as directed by us, at your sole expense while preserving it in marketable condition; (c) enter any premises where the collateral is located to inspect, render unusable or take immediate possession of it, with or without demand, notice, court order or other process of law and without liability to us, in which case you irrevocably waive to the fullest extent permitted by law any bond, surety or security required as incident of such action; (d) sell, lease, or otherwise dispose of the collateral at a public or private sale, with minimum ten days' notice, blah blah"

 

so yes, they can demand payment in full, including a bunch of interest (18% a year),  you must give everything back immediately, you must let them come onto your property to retrieve (or destroy!) the property, and they can sell, lease, auction or otherwise dispose of the stuff with 10 days or more notice.

 

IMO the lawyers that took tommy's money were kind of unethical writing that crap up because all of this is listed in black and white in the contract, directly refuting their claims and it seems they did it to waste amurs' time and cause them to incur legal bills without merit, but that's just my opinion.  anyways, that same contract says they can just add their legal fees to tommy's bill so I guess they will do just that.  (also, I'm sure they have lawyers on staff that do this stuff, so it isn't a direct extra expense... but they sure will be adding it to the bill!)

 

The one thing I found interesting in there is that they can come in and destroy the collateral if they so desired!  Though "render unusable" might mean they take parts of the collateral to make it hard to impossible to resell or dispose of except as trash (i.e. removing the backs from chairs or whatever).

[roots.genoa]

8 hours ago, number6 said:

Quote

Supreme Court rules 9-0 that bankruptcy filers can’t avoid debt incurred by another’s fraud

OK but you don't need to yell, you know?

[Tommy2D]

5 hours ago, jerseystyle said:

When I spoke to TT about this he blew off my suggestion and implied I don’t understand business. Good times. 

I imagine that the conversation was similar to Ray, from Trailer Park Boys, asking Bubbles to boost his battery with his go-cart (which has no battery, just a pull cord). 

 

"You don't know how they work! I don't want to argue about this anymore!"

 

 

[number6]

10 minutes ago, roots.genoa said:

OK but you don't need to yell, you know?

Heh. Well if I had given the link (below) instead it would still be yelling...just coming from CNBC instead of me..

Source

 

#6

[Cebus Capucinis]

LOL, yeah, that's an absolutely standard and non-egregious UCC equip finance contract (compared to others and nevermind I think all equip finance contracts are heavily one sided in favor of lender). The 18% is the maximum amount allowed by law in any state (and there's definitely a separate section that says if it's lower by law, the interest rate is whatever that rate is to avoid usury laws).

 

Usually "render unusable" applies to PCs, servers, etc - they can essentially disconnect them and, under a limited liability provision, not be responsible for any interruption of business, lost profits or other expenses.  They could certainly rip backs off chairs but I've never seen that done - it's usually just "we're unplugging your server rack, thanks bye"

 

The thing with fees is a court can award a winner "reasonable attorney's fees" under what's called the "American rule" (loser pays winner's fees), and parties can even contract in advance to fee shifting (making it even stronger for lender here) so if they use a GC or in-house counsel, they can still provide an estimate of what the fees WOULD have been, even if it's more than that person's salary, and be awarded the amount as long as it's "reasonable" in comparison to outside counsel's rates.

 

Given all of this, yeah, I'm assured this strategy on the part of TT's counsel is "be annoying enough that settlement looks better." It may also be client directed - one thing to remember is we have an ethical duty to inform our clients of the law, but we ALSO have an ethical duty to be an advocate, so usually that convo goes like "well these arguments aren't very strong and you're unlikely to win" "do it" "okay but I advised you of the consequences"

 

To be frank, and not to give ol' TT or his counsel any ideas, I'm surprised they didn't use the usual "this isn't an equipment lease, it's actually a hidden security interest and therefore unenforceable," which is the usual argument debtors make because there's general uncertainty in courts as to when something is a true "lease" or not. It's a good way to make just enough of a fact issue to get it past summary judgment and motion to dismiss and the other side to the bargaining table when your arguments are weak.

 

Remember, the goal in litigation frequently isn't "have a strong argument and win at trial," it's "have a strong ENOUGH argument that even if it's weak the other side caves a bit" - that's especially true in the debtor/creditor situation.

[jerseystyle]

49 minutes ago, Tommy2D said:

I imagine that the conversation was similar to Ray, from Trailer Park Boys, asking Bubbles to boost his battery with his go-cart (which has no battery, just a pull cord). 

 

"You don't know how they work! I don't want to argue about this anymore!"

 

 

One of my top 5 favorite scenes. Now I want some Newfoundland Steak.

[jerseystyle]

58 minutes ago, Tommy2D said:

I imagine that the conversation was similar to Ray, from Trailer Park Boys, asking Bubbles to boost his battery with his go-cart (which has no battery, just a pull cord). 

 

"You don't know how they work! I don't want to argue about this anymore!"

 

 

And seriously that’s how I felt talking with TT sometimes. The conversations were always civil (archived on AA somewhere) but like, man, LISTEN to people who know what they are talking about. Some of us have found success in these, or parallel, fields. There is a reason for that.

[Matt_B]

Someone posted the following story on Reddit that should give you an idea of just how endemic it is to be kitting out short-lived startups with designer furniture:

 

https://archive.is/2023.02.25-101702/https://www.nytimes.com/2023/02/25/technology/office-furniture-tech-companies.html

 

It's interesting that their goal is to recover 20 cents on the dollar, as that's a bit better than Intellivision got for theirs, but I suspect that "given enough time" makes a big difference. You're never going to get the best prices for a forced repossession and sale, and sticking it in a warehouse while shopping around is probably just going to make it depreciate further.

 

Either way, it should illustrate that they were always going to be reliant upon the guarantor to make up the bulk of what was owed, even under the best of circumstances. With Tommy having signed on behalf of Intellivision (who he supposedly still works for) as well as the personal guarantee, I've a feeling that he's going to have a hard job getting his name taken off the suit.

 

 

[MrBeefy]

7 hours ago, jerseystyle said:

I’ll never understand why IE went this route. As I said on the Reddit (and to TT himself when he did the first office tour): this was a complete waste of money and resources. 

It is simple really. Tommy Tallarico is the Grandpa Joe of idiots.

[Cebus Capucinis]

For the record, I don't anticipate the suit to last particularly long, nor actually go to trial. I'd be surprised if it gets even to summary judgment stage. In terms of real-time, I'd give it 90-120 days before there's a settlement (I admit I could be wrong and stranger things have happened). In litigation world that's merely a blink of an eye on a court calendar these days. They might have a preliminary hearing and a scheduling conference but I predict that'll be it. $180k is nowhere near enough to go through a full MSJ and trial-setting process with discovery. When the legal bill starts reaching $20k or so, which is ... hardly any time at all (even at my middle of the pack national rates that's not a lot of hours) ... cooler heads will prevail and they'll reach some sort of middle ground around $100k.

[roots.genoa]

6 hours ago, Cebus Capucinis said:

I admit I could be wrong and stranger things have happened

Yeah, wait til Tommy watches a legal thriller and decides to Perry Mason up in this bitch.

[awbacon]

On 2/25/2023 at 2:59 PM, masschamber said:

shame it seems like its going to end with nothing but a settlement barely out of small claims court and a handful of pilot and prototype units and a bunch of empty boxes, shame, if by some miracle there are some more test units hopefully the liquidators will sell them, I'd still buy one just because I like odd ball video game hardware, 

on the bright side anyone  looking forward to @awbacon's inevitable video on one of the few pilot units in a  decade or  so?

haha if I can find one 

[MrBeefy]

Fun music video from Ouyamico.