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Poll Results
 
 Do you want to participate in class action?
 Yes 5 50%
 No 5 50%
Total votes: 10. This poll has been closed.


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saxster

Senior Member
Registered:
Posts: 109
Reply with quote  #1 
Today I have read Mr. Dan Bensimon's Declaration to Bankruptcy Court in support of debtor's petition and first day motions, entered yesterday, July 28.
 
I find this statement quite alarming and unsettling:
 
"3. Vault. - In 2012 BullionDirect.com modified the terms of service under which its customers purchased and stored precious metals. BDI’s management interpreted the provisions of the Terms of Service agreement such that when a customer placed an order, the precious metal was not actually purchased unless the customer agreed to take actual delivery of the product.  Previously, the purchase order would have resulted in either delivery to the customer or storage of the product in a BullionDirect vault."

In 2008 I sent BDI a "large" amount of gold and silver bullion in the form of 1 ounce coins for storage and trading.  I did not buy the bullion from BDI and am in the possession of receipts from other sources where I acquired them with my own money.

Today I inquired of BDI's attorney, Mr. Joseph Martinec as to whether BDI's "creative" interpretation of The Terms of Service applied to my property and whether or not they were prepared to send my property to me as I have requested.

His response was that he was "currently unable" to respond to either my request for information or for delivery of product to which I "believe" I am entitled. He than suggested that I file a proof of claim and/or consult an attorney.

In my opinion, BDI built their business off of the backs of customers who understood that the terms of service clearly indicated, (and still indicate), that metal stored for them by BullionDirect, Inc. was the property of the customer and pooled for use among the other customers on a fungible basis by BDI for the specific purpose of facilitating the buying and selling of physical bullion.  I do not accept the notion that BDI ever had the right to "use" my physical bullion for any other purpose than facilitating a sale of another form of physical bullion.  Payments to software developers, employees, or any form of overhead as a form of "use" of my physical bullion are clearly beyond the scope of the Terms of Agreement. 

I believe that an accomplished attorney can easily prove this.  I also believe that it can be established that customers with stored bullion, as well as customers with cash or undelivered bullion on account at BDI for either fraudulent sales or acquisitions of physical bullion should have the first rights to be made whole from the assets that remain of BullionDirect, Inc.  (Yes, even before the IRS.)

For this reason, I plan to be represented by an attorney at the first hearing, August 25, in order to present my proof of claim and express my point of view.

I have not selected an attorney yet.  But I intend to begin interviews with all that are interested in this case.  I am open to the idea of a class action.  If other members of this forum who are in a similar situation as I, and are interested in the idea, you may private message me and I will begin to compile a list of everyone.  I have no idea how much money this will cost.  But, I am beyond angry now and will fight for my right to justice and will make whatever sacrifices are necessary.  If we can share the burden of cost, presenting a united front at the same time, we will have a greater impact on the bankruptcy court.

So drop me a line and we can discuss this.  I have plenty of time to dedicate to this project.

Let's start by taking straw poll.  Are you interested in class action?  Vote Yes or No.
0
plankton

Member
Registered:
Posts: 65
Reply with quote  #2 
'Gerard Barrack' has already obtained a lawyer to represent his interests:

Martin Seidler, One Elm Place, Suite E-504, 11107 Wurzbach Rd, San Antonio, Tx, 78230; Tel (210) 694-0300; Fax : 210-690-9886; email : seidlerlaw@yahoo.com

It definitely doesn't make sense for all 6000 claimants to obtain representation but yeah a class action if we meet qualification for such would make sense.
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JG

Administrator
Registered:
Posts: 991
Reply with quote  #3 
One thing to be aware of is that you normally cannot sue a company in Chapter 11 for debts incurred before the bankruptcy petition.

Also, even if you could, I cannot see how you could get more money than what they have.

I believe a class action would be appropriate if there was money to be found somewhere; e.g. if someone outside of BD could be held responsible. IANAL, though.

As far as the "This is fraud" argument goes, I believe that goes from civil to criminal, and the government agencies are likely fighting over who gets to take the lead on that.

I'm not saying a class action lawsuit is a bad idea -- it certainly couldn't hurt to check (especially if an attorney offers a free consultation).
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spainte

Member
Registered:
Posts: 40
Reply with quote  #4 
Is Gerard Barrack on this forum? Be good to have him join this discussion.
0
harley_52

Senior Member
Registered:
Posts: 132
Reply with quote  #5 
I would entertain discussions about a class action, but it seems to me we may have competing classes of claimants.  One would be those whose metal was supposedly stored for them by BDC and another would be those who (like me) made purchases for "in stock" metal for immediate shipment.  Frankly, I am not interested in my category being placed behind the storage claimants in the line for reimbursement of losses. 
0
tboll

Senior Member
Registered:
Posts: 299
Reply with quote  #6 
I'm afraid that the risk of numerous class actions suits would be that what little assets are left to distribute would end up going predominantly to payoff the many/several lawyers' fees.  I've been party to several class action suits involving company stocks and it never fails that although they win tens of millions, I seem to end up getting check for fifty cents.
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saxster

Senior Member
Registered:
Posts: 109
Reply with quote  #7 
Frankly, I don't understand why a bankruptcy proceeding is even taking place.  It's obvious to me that BDI was committing massive fraud from the beginning.  Dan Bensimon's Declaration regarding BDI's interpretation of The Terms of Service yesterday confirms it.  I'm going to ask an attorney to introduce a motion on August 25 to halt it so a class action suit can be initiated.  Chapter 11 is out of the question now since it's impossible for BDI to ever recover.  The customers were robbed even before BDI incurred their debts.  The IRS has no business with a claim in this since BDI never made a legal profit.  BDI's "income" was the money they stole from the customers.  Giving BDI the means to hire a interim CEO and attorney by way of letting them cash fraudulently acquired checks is a total travesty of justice.  It just drains more funds that could be recovered for the victims of this crime.
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JG

Administrator
Registered:
Posts: 991
Reply with quote  #8 
Quote:
Originally Posted by saxster
Frankly, I don't understand why a bankruptcy proceeding is even taking place.  It's obvious to me that BDI was committing massive fraud from the beginning.  Dan Bensimon's Declaration regarding BDI's interpretation of The Terms of Service yesterday confirms it.  I'm going to ask an attorney to introduce a motion on August 25 to halt it so a class action suit can be initiated.  Chapter 11 is out of the question now since it's impossible for BDI to ever recover.


IANAL, but...

What happens if a class action lawsuit sues Bullion Direct, and the bankruptcy is not allowed? Who runs the company? Who sells the patent and such to get money?

I could see bankruptcy changing to Chapter 7, but I don't see how it would be beneficial to stop the bankruptcy. Bullion Direct isn't likely to recover in the traditional sense, just continue the website as proof of how the patent works.

0
johnnyeagleeye

Junior Member
Registered:
Posts: 23
Reply with quote  #9 
After reading that there is little precious metal in Delaware, I am even more furious! Ladies and Gentlemen, we have been had. We are victims of FRAUD. I fully expected to receive my order or precious metal when I sent BD a check in early May that they cashed. I certainly had no intent of funding NUCLEO!
I cannot imagine that the Texas AG will not go after Chas. by filing criminal charges. I would encourage those of you who have not filed a claim against BD with the Texas AG's office to do so. It is quite easy. Are there any bloggers in TX who have contacts at the TX AG's office? 
As far as a class action lawsuit goes, that would have to be filed against Chas. and not BD. BD is protected by bankruptcy law. Personally, I will not rest until I see Chas. any  others responsible for BD's fraudulent behavior put in jail. This message is given by a non-attorney spokesman.
0
JG

Administrator
Registered:
Posts: 991
Reply with quote  #10 
Quote:
Originally Posted by johnnyeagleeye
I cannot imagine that the Texas AG will not go after Chas. by filing criminal charges. I would encourage those of you who have not filed a claim against BD with the Texas AG's office to do so. It is quite easy. Are there any bloggers in TX who have contacts at the TX AG's office? 


The Texas Attorney General is already investigating, as are the FBI, Travis County DA and at least one or two more government agencies. They know the difference between creative interpretation of terms and fraud, and will take care of things if things need to be taken care of.

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johnnyeagleeye

Junior Member
Registered:
Posts: 23
Reply with quote  #11 
Good news to hear. I did not know that the FBI and the Travis County DA's office were also investigating. Perhaps we should let the "authorities" do their work and let justice be done rather than individually waste more money hiring an attorney(s) to file a class action lawsuit against a defunct company with a virtually empty vault and with intellectual property which may be worth less than a tick on a hog's back.
0
GWest

Member
Registered:
Posts: 31
Reply with quote  #12 
I don't think its a good idea to take this matter to the civil courts in a class action or otherwise. When you sue someone, you might think you are asking the court to give you the defendant's money. Actually, you are asking the court for a piece of paper that says the defendant owes you money. Now what are you going to do with that against BD or Charlie? Well, you can haul him in for a debtors interview and ask him where his assets are. But this is the same function the bankruptcy courts are performing. You have the added benefit of the FBI investigating all frauds, concealments, misrepresentations, and other inconsistencies in a bankruptcy. Nobody performs these services in a civil action.

There is yet another court of justice in the streets. I am not suggesting that anyone use that method of justice. But when a crook produces 6000 victims, the statistical probabilities are very high that at least one victim will take matters into his own hands.

It is looking more and more like a blatant criminal act. Charlie has taken a lot of risks here that most people would not take. He is risking his life to both street justice and prison. Even if he is exonerated, he would need to live like a prisoner for years. There is one other possibility that looms in cases like this. People often choose to take such risks for the benefit of their family if they know they have a terminal medical condition. Someone with an inside connection to his friends or close employees should investigate this possibility.

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Lars

Member
Registered:
Posts: 43
Reply with quote  #13 
Quote:
Originally Posted by tboll
I'm afraid that the risk of numerous class actions suits would be that what little assets are left to distribute would end up going predominantly to payoff the many/several lawyers' fees.  I've been party to several class action suits involving company stocks and it never fails that although they win tens of millions, I seem to end up getting check for fifty cents.

I agree 100%.  That's been my experience/observations on class action suits.  The only people who make any money are the attorneys.  The victims get pennies.
0
areabird

Junior Member
Registered:
Posts: 10
Reply with quote  #14 
Good evening -

I'm a business bankruptcy attorney who has been practicing in Texas and New York for ~13 years. I have been following the BD saga for awhile, and hopefully what I post will give people some information on their rights, generally. WHAT I AM POSTING IS FOR INFORMATION PURPOSES ONLY - IT IS NOT INTENDED TO BE AND SHOULD NOT BE TAKEN AS LEGAL ADVICE. Also, I'm posting just to try to help people avoid bad information - I'm not trying to solicit anyone's business here.

When a company files for bankruptcy, a statutory "automatic stay" goes into effect that prohibits pretty much any and all efforts to collect a debt owed by the bankrupt company ("debtor") or otherwise assert control over the debtor's property. The purpose is to channel all of the claims against the debtor through the bankruptcy process, generally through filing proofs of claim.

Creditors can, however, seek relief from the stay, which is colloquially referred to as "lifting the stay", by filing a motion with the court. In this case, the likelihood that the Bankruptcy Court would lift the stay to permit a new class action to be filed is, in my opinion, effectively zero. So while I empathize with the sentiment and desire to take some form of action, a class action against the company itself is not it.

If you think you may be owed money by BD, then your primary option is to file a proof of claim. There is a lot of chatter going on as to whether any given person should file a proof of claim, and if so, when. As a general matter, filing a proof of claim is the way that you put the debtor and the world on notice that you believe you have a claim. Failing to file a proof of claim can, in some circumstances, result in you losing any right to recovery. However, every creditor's situation is different and your situation may involve specific facts and circumstances that would impact the decision to file.

For people like the poster who have metals in storage or on deposit with BD, then you should definitely consider getting an attorney, and if you can, find similarly situated people to join up with, because it is possible you have different rights and may, depending on a whole host of factors, have the ability to seek turnover of your metals.


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BD BOINKED

Junior Member
Registered:
Posts: 13
Reply with quote  #15 
Quote:
Originally Posted by areabird
If you think you may be owed money by BD, then your primary option is to file a proof of claim. There is a lot of chatter going on as to whether any given person should file a proof of claim, and if so, when. As a general matter, filing a proof of claim is the way that you put the debtor and the world on notice that you believe you have a claim. Failing to file a proof of claim can, in some circumstances, result in you losing any right to recovery.


Thank you for your input! Is there any way you take a moment to comment on how filing a proof of claim could result in losing your right to recovery?
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