New public documents filed in the Morgan Drexen case paint a picture of Walter Ledda caught by surprise by the turn of events.
These excerpts are from the documents shown with the source link. You can click on those documents to read the full original filing.
In the first document, Ledda represents the recent CFPB action caught him by surprise. In the second document, his declaration, he appears to say Howard Law or Vincent Howard was trying to take advantage of him.
“The order to show cause at issue in this case took Ledda by surprise. He has been in daily negotiations with plaintiff Consumer Financial Protection Bureau (“CFPB”) and never once has there been a suggestion that he was in contempt of any order by this court. Ledda’s employment with Morgan Drexen, Inc. (“Morgan Drexen”) was terminated in June 2015, and Ledda has had virtually no dealings with Morgan Drexen since that time. Ledda was puzzled when the court suggested he had done something wrong to violate the court’s injunction order. His counsel had to call the CFPB to find out what was being referenced, and the CFPB directedLedda’s counsel to brief testimony from David Walker (“Walker”). It was clear from reading the Walker testimony that Walker was speculating about things he thought might have happened regarding a company called Legalsoft, Inc. (“Legalsoft”). As discussed in the Ledda Declaration, Ledda was willing to sell Legalsoft in a stock transaction, but not the database, and those discussions terminated without a sale. Legalsoft has not sold anything to anyone. Ledda still owns the company and disclosed that ownership in his recent financial disclosures to the CFPB. Accordingly, Ledda has not violated any court order.”
Ledda owned Legalsoft. Legalsoft provided backup support to Morgan Drexen and The Howard Law Firm (“Howard”). In short, Legalsoft had computer servers in Nevada, which could backup the Morgan Drexen servers in the event of a catastrophe, such as an earthquake. Howard paid Ledda $25,000 per month for backup support. When it became clear that Morgan Drexen would be out of business, the future of Legalsoft became bleak. Ledda, therefore, reached out to Howard to see if Howard wanted to continue using the backup services Legalsoft provided. Ledda did not see how the sale of the stock in his company would violate any court order, but was not willing to sell anything short of the entire company.
Recognizing Legalsoft had no other prospective buyer, Howard offered only $25,000, which was one month of payment for Legalsoft’s services. Ledda recognized he had nowhere else to go, but considered the offer a “hold-up” and was unwilling to sell the company for $25,000. Accordingly, there was no sale of the company. There was no sale of data. There was no sale of anything.
Ledda still owns the company and has fully disclosed his ownership interest to the CFPB. He valued his Legalsoft stock at zero because the company no longer has any paying customers and is unlikely to have any.” – Source
Howard Taking Advantage
“After the court issued terminating sanctions against Morgan Drexen, I recognized Morgan Drexen would have to go into bankruptcy and it was unlikely it would survive. As the usefulness ofLegalsoft’ s technology was heavily dependent upon the success of Morgan Drexen, I questioned whether Legalsoft could survive the Morgan Drexen bankruptcy. Howard was insistent that notwithstanding what happened to Morgan Drexen, Howard would be able to continue practicing law and servicing its clients.
I engaged in negotiations with Howard to buy Legalsoft. If he were to continue using the MDIS operations, he would need a backup system.
I learned Howard was not interested in purchasing Legalsoft, but was only interested in purchasing part of it. I was concerned that selling part of Legalsoft, as opposed to my stock, might violate the injunction and, therefore, communicated to Howard that I would insist upon his firm either buying the Legalsoft stock or nothing.
COLLAPSE OF NEGOTIATIONS
After the bankruptcy trustee terminated my employment with Morgan Drexen, I accepted a temporary employment position in Poland on July 1, 2015.
While I was in Poland, I learned that Howard would not pay more than $25,000 for Legalsoft. Howard had been paying $25,000 per month for the backup services provided and was essentially offering to pay one month of services to buy the entire company. I felt Howard was taking advantage of his position of being effectively the only potential purchaser of Legalsoft, and I was unwilling to sell Legalsoft for nothing when I had made a substantial investment in building it. I turned the offer down.
Accordingly, sales discussions ended without a sale.
I continue to own Legalsoft. I identified Legalsoft as one of my personal assets in my recent financial disclosure to plaintiff Consumer Financial Protection Bureau. I indicated the estimated value of Legalsoft to be zero because, at this point, I do not think Morgan Drexen will survive, Howard is unwilling to buy the stock and, therefore, Legalsoft cannot survive.
Accordingly, l never sold Legalsoft, and I never sold the business lines of Legalsoft I never sold the database to anyone. Any statement to the contrary is false.
I declare under penalty of perjury under the laws of the United States of America that the foregoing is true and correct Executed in Warsaw, Poland.” – Source
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