Zeek Rewards victims to foot pro-Ponzi expert bill
You’d think some two and a half years after Zeek Rewards was shut down and revealed to be an $850 million dollar scam, that the issue of whether or not it was a Ponzi scheme would have been wholly settled.
Unfortunately that’s not the case.
In their latest ploy to avoid paying back those they stole from, Zeek’s top US investors will now elect a “rebuttal expert” to argue their case.
And wasting even more time isn’t the half of it. Through the Receivership, Zeek’s victims are going to partially foot the expert’s fees.
These latest developments come by way of a status conference held on January 8th between Zeek’s top net-winners and the Receiver.
As per an order published on January 12th,
Pursuant to discussions at the status conference, the Court has determined that the Receiver will have to bear some of Defendants’ costs of hiring a rebuttal expert.
How much a pro-Ponzi rebuttal expert costs I have no idea, but obviously enough that Zeek’s net-winners, some of which made off with millions, don’t want to foot the entire bill themselves.
Defendants are to obtain bids and submit to the Court a report outlining the bid process and the scope of the work, informing the Court of the identity of the expert that they intend to hire, and including a budget.
As above, the expert is to be chosen via a bidding process. With the order only published yesterday, who Zeek’s net-winners have in mind to argue Zeek wasn’t a Ponzi scheme is uncertain.
One can bet though that, once chosen, the same old “we sold bids and did real work” arguments that have already been rejected will be trotted out.
On one hand I get why the court is letting Zeek’s top thieves have their 5 minute argument in court, but at the same time do believe it runs contrary to sorting this mess out as quickly and efficiently as possible.
And for those of you honestly believe this pro-Ponzi expert is going to make a lick of difference, one only need look at Gerry Nehra’s expert testimony in the AdSurfDaily case a few years back.
Called to testify as an expert witness in favor of the scheme, Nehra filed an affidavit with the court claiming AdSurfDaily was not a Ponzi scheme.
That amounted to nothing, with AdSurfDaily’s founder Andy Bowdoin confessing it was a Ponzi scheme in 2012. That’s in addition to the mountain of evidence provided by the regulators who shut the scheme down in 2008.
Zeek Rewards, which like AdSurfDaily combined worthless advertising and Ponzi investment, will be no different.
The only shame is that Zeek’s victims are going to have to pay to see this theater play out. And at the end of the day Zeek’s top thieves are still going to have to pay back what they stole.
On and on it goes…
Footnote: Our thanks to Don@ASDUpdates for providing a copy of the 8th January 2015 status conference order.
Well I am sure it won’t be Kevin Grimes, but doubtful if it would be Kevin Thompson either since KG is now a partner in KT’s law firm. Think that would be a conflict due to KG’s charges he faces in Zeek.
Not a whole lot of people left to choose from. Hey maybe it will be Robert Craddock, Keith Laggos (he’ll say anything for the right fee), or ? ? ? LOLOLOL!
I was actually thinking they might go for Nehra, as cliched as that would be.
Either that or one of the net-winners’ existing counsel. Are they barred from putting in a bid since they no doubt pushed for this?
The arguments raised have already been shot down in the motions to dismiss – so it all seems rather pointless.
That’s ok. If he’s a ‘genuine’ expert with valid information he’ll be happy to be paid on a no win no fee basis.
This is not easy? They can drain some money with it. Like, bounce a tree and 10 lawyers drop from it. Choose one and say: I pay you a million but you will give-me back 500k.
When they lost the case, they just justify that used the money to pay their defence. In some way, they can declare bankruptcy and when everything finish, they have this legal money.
Can they do it? Because this was what Telexfree was trying to do. 😀
Actually I did think of Nehra, but thought surely they wouldn’t try him after his ASD fiasco.
Then on the other hand I do hope they do and he loses big. It just might end his career as this “expert” in everything MLM coattail he has been riding since the AMWAY case.
But I thought this is what Robert Craddock formed their organization to do that they solicited funds for to pay an attorney to fight the closure of ASD?
Maybe the judge should ask Robert Craddock what happened to the money and why it can’t be used in this case since he is one of the winners?
If its being let out to bid, tell ’em I’ll do it for $100 plus expenses. Anyone who will do it for less than that and still say its not a ponzi is a fool.
And seriously, neither side should get to pick, the court should choose among those offered by each side. This in fact may be the basis of having the sides share costs.
@Rodrigo
The process is put before the court. Anything suss is likely to be objected by the Receiver (don’t forget they’re funding some of it), and subsequently denied by the court.
They also can’t just disappear funds, as expenses are pre-approved by the court (for this particular expert).
nehra has been around MLM forever, so he could be The One.
his CV says he has provided expert testimony on direct selling legal issues in Herbalife v. McCormack, Dunda v. Mary Kay, Florida v. P.R.S.I., FTC v. Trek Alliance, and International Galleries Inc. v. LaRaza, and of course the feather in his cap Amway.
thoughtfully, his CV makes no mention of ASD.
If the idea is to prove “legal MLM”, then I will guess Mike Sheffield, one of Jeff Babener’s favorite expert witnesses.
If the idea is to prove something else, e.g. “no securities involved in Zeek”, then I have no idea which one they will choose.
there has been mention of ‘Jury’ in this case so far. so far it seems like a ‘Bench Trial’:
“Bench trials are often resolved faster. Furthermore, a favorable ruling for one party in a bench trial will frequently lead the other party to offer a settlement.
The judge is both the finder of fact and ruler on matters of law and procedure. This means that the judge decides the credibility of the evidence presented at trial and also decides what happens at the trial according to laws and rules of procedure.
Bench trials also tend to be slightly less formal than jury trials. A bench trial may also be useful in particularly complex cases that a jury might not understand.”
fact alert!!—- robert fitzpatrick LIVES in charlotte, NC. will the SEC or bell come knocking at his door for expert testimony????
Does this apply to rebuttal witnesses?
Presumably, the estate will be permitted to add this cost to the judgment amounts.