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Back2Back2Back

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Here’s the article fwiw.

https://www.couriermail.com.au/busi...w/news-story/95afa46e5f7d8b681d703440b98b83ed

City Beat: Brisbane Lions planning to sue former sponsor SOOW
MARCH 11, 2019
The Brisbane Lions are planning to sue a struggling tech start-up after cutting them loose last week for allegedly failing to pay moneys owed as the club’s co-major sponsor.

Lions boss Greg Swann told City Beat on Monday that Brisbane-based Data Fund Pty Ltd, trading as SOOW, was “behind on their payments’’.

But it’s understood they hadn’t forked out even a cent over the past four months despite a personal guarantee provided by SOOW co-founder and boss Michael Twomey, whose company headquarters is across the street from the Gabba.

SOOW only teamed up with the Lions in November in a $2 million deal for the next two AFL seasons. In comments that seem grimly ironic now, Twomey said at the time that “good relationships are built on trust’’.

Expect the Lions to announce a replacement in the next week or so as they unstitch the SOOW name from team jerseys.

Given their track record with sponsorship, let’s hope they do a bit more due diligence this time. Two of the Lions’ former backers, Camperdown Dairy International and apparel supplier BLK, both collapsed in the past three years.

SO WHAT

So what do we know about SOOW, which launched at last year’s Myriad tech festival and flogs a “customer data platform’’ to sort out information for businesses?

We know that there are some pretty unhappy creditors out there, including mischievous hackers who got hold of Twomey’s personal website recently and redirected it to a Wikipedia page about convicted US fraudster Billy McFarland. There is no suggestion that the two men had anything to do with each other.

Twomey is a former head of “digital entrepreneurship’’ at Coles who oversees Soow with tech player Craig Deveson and former Bubs Australia CEO Nick Simms.

Sources close to the company say Twomey claims to have raised nearly $10 million from investors and struck up a funding deal with Blue Ocean Equities in Sydney.

But it’s understood that SOOW top guns met with a corporate restructuring outfit this month as staff allege they haven’t been paid for weeks and even got fake remittances. Some have now lodged complaints with the Fair Work Commission and ASIC.

A New York-based marketing firm is also understood to be on the verge of launching legal action over about $290,000 in allegedly outstanding invoices.

We hear that same marketing outfit also did quite a bit of work for Twomey’s missus, Danielle, who runs online homewares business Grovely Style Co from the same offices as SOOW.

In case all this wasn’t enough, American Express sued Twomey in Brisbane District Court in December over allegedly unpaid debts. No defence has yet been lodged in the case.

Twomey, who resides in million-dollar spread at Mitchelton, could not be reached for comment on Monday. His wife, Danielle, who is also the majority owner of SOOW, did not return a call.

Neither Deveson nor Simms could not be contacted. Blue Ocean declined to comment.
Not a cent paid. Amazing.
 

Tom14

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Football Pope

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I'm not a practicing lawyer (have the degree but have pursued a different career) but I'm certain this isn't true for commercial litigation - if you win a case then the court may make a costs order for payment of legal fees against the other party in addition to the damages (you may not get all of your costs covered though). However if the other party is insolvent you still have to pay your lawyers and there is no compo fund that will do it for you.

Compensation funds have been set up by legislation in some jurisdictions for some motor vehicle accident issues but that is specific to car accidents.

If SOOW is insolvent/on the verge of bankruptcy then claims against the company are pretty pointless. Not knowing the circumstances or grounds for other possible actions I don't know whether us commencing an action is necessarily a good/bad idea. We may only be at the stage of engaging lawyers to send letters of demand to SOOW rather than commencing litigation just yet.
maybe to force the winding up of..

Compensation proceedings
Compensation proceedings for amounts lost by creditors can be initiated by ASIC, a liquidator or a creditor against a director personally. A compensation order can be made in addition to civil penalties.

Compensation payments are potentially unlimited and could lead to the personal bankruptcy of directors. The personal bankruptcy of a director disqualifies that director from continuing as a director or managing a company

https://www.asic.gov.au/regulatory-.../directors-consequences-of-insolvent-trading/
 
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BrizzyBandit

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If the Directors traded whilst insolvent or be proven to take the sponsorship knowing they had no way of paying..... then the corporate veil can be pierced and the Directors can be personally held liable.

However this is tough to prove in court.... you'd want to know you have a strong chance of success and know the Directors have the personal wealth to make the risk worth it.... Directors can take measures to make this harder with family trusts etc.

Either way.... not great publicity that we're suing anybody
 

Dlions

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“Twomey, who resides in million-dollar spread at Mitchelton, could not be reached for comment on Monday. His wife, Danielle, who is also the majority owner of SOOW, did not return a call.”

Wouldn’t this make her somewhat liable as well?
Even if everything is in her name? With her a Director of the Company she is just as liable as he, is she not?
 

Pacman82

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Probably a just BL supporter who's company failed (still have no idea what they do after looking at their website when they first signed on) so don't really wish them any harm. The club's dropped the ball by not being able to tap into the major industries operating in QLD, surly there's plenty of mining dollars up there that could be funneled our way while giving tax incentives to the sponsor..
 

Fatcat08

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Moderator #736
“Twomey, who resides in million-dollar spread at Mitchelton, could not be reached for comment on Monday. His wife, Danielle, who is also the majority owner of SOOW, did not return a call.”

Wouldn’t this make her somewhat liable as well?
Even if everything is in her name? With her a Director of the Company she is just as liable as he, is she not?
That says she's an owner not a director, they're treated very differently from a litigation POV. as mentioned before owners and shareholders are protected with a limited liability company. Directors not so much, however if he doesn't own any assets and they're all tied up in trusts with multiple appointors or owned by his wife then they will be mostly untouchable.
 

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Scubaveg

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Depends how strong their litigation shield is. Hopefully not strong enough to insulate them individually from the company.
Corporate veil pretty much means no. It’s not the directors that haven’t paid up it’s the company. We are not even shareholders so can’t see how we could take action against directors. We are unsecured creditors and failing a personal guarantee line up with cap in hand like the others. Will be lucky to get 1c in the dollar.

As far as the personal guarantee goes, blood and stone comes to mind.


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Davemonkey

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Video games are a team aren't they?
Corporate veil pretty much means no. It’s not the directors that haven’t paid up it’s the company. We are not even shareholders so can’t see how we could take action against directors. We are unsecured creditors and failing a personal guarantee line up with cap in hand like the others. Will be lucky to get 1c in the dollar.

As far as the personal guarantee goes, blood and stone comes to mind.


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Wasn't the source of all this some Curious Snail scuttlebut column? Hardly worth the angst I feel. (Not that your bring angsty Scubaveg, I am just picking up on the thread).
 

Skoob

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Important to note, that we wouldn't be suing for $2 million.
Whatever costs have been incurred by sticking their name on things, is what we're after, + legals.
Do we even know that they have no money? It seems the logical conclusion, however they could have moneys owed to them and their crime, is non-payment, not inability to pay. They probably have moved money, but I haven't heard if they're insolvent.
 

a mayes ing

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Important to note, that we wouldn't be suing for $2 million.
Whatever costs have been incurred by sticking their name on things, is what we're after, + legals.
Do we even know that they have no money? It seems the logical conclusion, however they could have moneys owed to them and their crime, is non-payment, not inability to pay. They probably have moved money, but I haven't heard if they're insolvent.
You would think we have done our due diligence and made sure that they have money to give if we are suing them otherwise what is the point with all the legal fees. However, SOOW are also being sued by a number of companies arent they? How much money would they ahve left
 

POBT

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Important to note, that we wouldn't be suing for $2 million.
Whatever costs have been incurred by sticking their name on things, is what we're after, + legals.
Do we even know that they have no money? It seems the logical conclusion, however they could have moneys owed to them and their crime, is non-payment, not inability to pay. They probably have moved money, but I haven't heard if they're insolvent.
We would be suing for $2M plus any other cost we incurred due to their breach. That would be offset by any money paid already and any replacement revenue we pick up. If we pick up another sponsor worth $2M (unlikely I suspect), then we will have mitigated our losses and it probably wouldn’t be worth pursuing things too far.

If the company goes bust (and the personal guarantee is worthless), we will simply get in line as an unsecured creditor and wait for the scraps, if any.
 
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The irony of a company priding itself on creating trust through honesty and transparency, hiding behind complex corporate legalities and ultimately misleading business partners is priceless.

Their website is down and Twomey's LinkedIn profile is "unavailable". I'd say the chiefs have made their $$ and ridden off into the sunset. Not sure of the value of aggressively pursuing them, but I'd be satisfied if we kept working with other aggrieved parties and enforcement bureaus.
 

Jivlain

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The irony of a company priding itself on creating trust through honesty and transparency, hiding behind complex corporate legalities and ultimately misleading business partners is priceless.

Their website is down and Twomey's LinkedIn profile is "unavailable". I'd say the chiefs have made their $$ and ridden off into the sunset. Not sure of the value of aggressively pursuing them, but I'd be satisfied if we kept working with other aggrieved parties and enforcement bureaus.
Nowhere near as funny as that "deceased" exchange founder who absconded with $137m worth of bitcoins, mind.
 
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