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  1. #1
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    VolumeDrive Sued For Breach of Fiduciary Duty

    Data Sales Co., Inc. v. Volumedrive, Inc.
    Filed: October 23, 2013 as 3:2013cv02626
    Plaintiff: Data Sales Co., Inc.
    Defendant: Volumedrive, Inc.
    Cause Of Action: Diversity-Breach of Fiduciary Duty
    Source:

    http://dockets.justia.com/docket/pen...3cv02626/96153

    I'll obtain the PDF's shortly from PACER and post them for our amusement. Thank god, it's about time someone stuck it to them!
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  2. #2
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    Haha I used to live a mile from Data Sales Co., Inc.
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  3. #3
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    Quote Originally Posted by Patrick View Post
    Source:

    http://dockets.justia.com/docket/pen...3cv02626/96153

    I'll obtain the PDF's shortly from PACER and post them for our amusement. Thank god, it's about time someone stuck it to them!
    Thanks for posting. Will be interested to see the details of the case.
    I support the Human Rights Campaign!
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  4. #4
    So are volumedrive being sued because they rented all the hardware via Finance from Data Sales Co.

    And they don't allow Volumedrive to actually rent that hardware so they can make a profit ?
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  5. #5
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    Nice find! I hope that the law catches up with these guys and they have a nice big settlement.
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  6. #6
    Join Date
    Jun 2009
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    Quote Originally Posted by AcclaimedHost Alan View Post
    Nice find! I hope that the law catches up with these guys and they have a nice big settlement.
    I hope WHT finally realizes they should ban these kinds of scammers.
    Remember when ordering a server from a new company use a Credit Card. Paypal will not refund your money if you get scammed.
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  7. #7
    Join Date
    Oct 2009
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    So Data Sales Co would be the hardware leasing company BurstNET said was the actual owner of the hardware - and that only leased hardware to VD on condition that the servers were locked to BurstNET's locales.

    And really, who didn't see that one coming?
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  8. #8
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    Very happy to see this. Thanks for sharing!
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  9. #9
    Quote Originally Posted by Violent Injection View Post
    I hope WHT finally realizes they should ban these kinds of scammers.
    I hope they don't. It's impossible to get answers from banned people.
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  10. #10
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    The case was filed on 23rd Oct 2013, and they still running the business.
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  11. #11
    Quote Originally Posted by cfgguy View Post
    The case was filed on 23rd Oct 2013, and they still running the business.
    Yes...why wouldn't they? I would suspect that they have not had any hearings, much less a ruling, at this point. I would be interested in seeing the documents, though. If they were obligated to keep the servers located at Burstnet as a condition of their contract, I don't see how they avoid penalty on this one. I would suggest that VolumeDrive customers keep good backups, just in case
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  12. #12
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    Quote Originally Posted by cfgguy View Post
    The case was filed on 23rd Oct 2013, and they still running the business.
    You don't shut down because of a lawsuit. Most will not go anywhere anyway. Google and Microsoft wouldn't be in operation today if that were the case.
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  13. #13
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    Quote Originally Posted by rits View Post
    You don't shut down because of a lawsuit. Most will not go anywhere anyway. Google and Microsoft wouldn't be in operation today if that were the case.
    Exactly! We dont know how many web hosting companies are under some kind of lawsuit and still doing business!
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  14. #14
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    They lease all their servers and have not been paying for their rented/leased servers (they haven't been making their payments).
    Thus, the company who sold/leased their servers is suing them because they aren't getting paid for the machines you all are using that VD is leasing from them.\
    Unless VD makes the payments, its a pretty hard argument to win in court; once Data Sales Co. wins the lawsuit (IF VD even shows up at all, then its by default Data Sales Co. winning), then Data Sales can come get their machines by COURT / POLICE order immediately.

    Good luck to everyone who has servers with VD, I hope you have backups, but I bet a lot of you don't... so here's a tip, start making them now.
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  15. #15
    Quote Originally Posted by Patrick View Post
    Thank god, it's about time someone stuck it to them!

    Patrick, We were starting to miss you! We were worried that you were starting to lose interest in our company.

    We are not going to make any comments on any ongoing legal matter.

    Is it not at all unusual for former business partners / competitors to abuse the legal system for frivolous, unsubstantiated claims. Large companies receive frivolous lawsuits all the time.

    We are very confident about the outcome of this case, and there isn't any cause for concern on any services that we provide.
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  16. #16
    Quote Originally Posted by volumedrive View Post
    Patrick, We were starting to miss you! We were worried that you were starting to lose interest in our company.

    We are not going to make any comments on any ongoing legal matter.

    Is it not at all unusual for former business partners / competitors to abuse the legal system for frivolous, unsubstantiated claims. Large companies receive frivolous lawsuits all the time.

    We are very confident about the outcome of this case, and there isn't any cause for concern on any services that we provide.
    Oh god... the arrogance... it burns.

    Why do you say you're not going to make any comments and then make the next two blocks of text comments on said case?
    Last edited by rallias; 12-07-2013 at 03:17 PM. Reason: typo
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  17. #17
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    Ouch, I can't see it ending well. I guess they got themselves into this mess!
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  18. #18
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    Quote Originally Posted by volumedrive View Post
    We are very confident about the outcome of this case, and there isn't any cause for concern on any services that we provide.
    You do realize that after the three week outage you didn't make any public statements about until a week into it, most people were concerned about the services you provide even prior to learning about the lawsuit?
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  19. #19
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    Tulsa, OK, USA
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    So, since volumedrive is sitting here being all cheeky, I decided to spend the $5 on PACER to download the PDFs.

    http://turtle.dereferenced.org/~kaniini/volumedrive/

    In my opinion: they screwed Data Sales pretty hard. That said, who would lease equipment in the hosting industry when you can get business loans at prime+1% from many lenders?
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  20. #20
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    Quote Originally Posted by kaniini View Post
    So, since volumedrive is sitting here being all cheeky, I decided to spend the $5 on PACER to download the PDFs.

    http://turtle.dereferenced.org/~kaniini/volumedrive/

    In my opinion: they screwed Data Sales pretty hard. That said, who would lease equipment in the hosting industry when you can get business loans at prime+1% from many lenders?
    Thanks for posting! I was waiting on a password reset with PACER and it still hasn't arrived. :/
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  21. #21
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    Quote Originally Posted by kaniini View Post
    In my opinion: they screwed Data Sales pretty hard. That said, who would lease equipment in the hosting industry when you can get business loans at prime+1% from many lenders?
    Hmm.

    14. As of the filing of the underlying lawsuit, VOLUMEDRIVE owes $116,118.48 to DATA SALES for the Leased Equipment
    ...
    16. Additionally, pursuant to the Equipment Schedules and the Lease, VOLUMEDRIVE was not to remove the Leased Equipment from a property located at 422 Prescott Avenue, Scranton, Pennsylvania

    17. The property located at 422 Prescott Avenue, Scranton, Pennsylvania (hereinafter the "BurstNet Building"), is owned by BurstNet Technologies, Inc. (hereinafter "BurstNet"), which is a company that provides co-location services to webhosting companies such as VOLUMEDRIVE.

    18. Upon learning that VOLUMEDRIVE was illegally removing the Leased Equipment from the BurstNet Building, BurstNet changed the locks on the building to prevent further removal

    19. With the assistance of BurstNet, DATA SALES has determined that VOLUMEDRIVE has misappropriated or taken 182 pieces of equipment, with a fair market value of $44,678.80
    Yup. That fits to a tee with what BurstNet has claimed previously.
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  22. #22
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    Where are the crap starters now?

    All the ones that were sure that BurstNET was full of it?

    GG.

    Francisco
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  23. #23
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    Quote Originally Posted by volumedrive View Post
    Patrick, We were starting to miss you! We were worried that you were starting to lose interest in our company.

    We are not going to make any comments on any ongoing legal matter.

    Is it not at all unusual for former business partners / competitors to abuse the legal system for frivolous, unsubstantiated claims. Large companies receive frivolous lawsuits all the time.

    We are very confident about the outcome of this case, and there isn't any cause for concern on any services that we provide.
    You are one cocky man.
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  24. #24
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    Quote Originally Posted by DeltaAnime View Post
    Where are the crap starters now?

    All the ones that were sure that BurstNET was full of it?

    GG.

    Francisco
    Maybe I will need to invest in some premium BuyVM anti-DDoS until I have my own mitigation finished.
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  25. #25
    Just reading the documents, seems it got kicked into a federal court and BN/DS is tring to kick it back down. Federal judges have a higher reputation of digging though the cases better and finding out the true story.

    Also this line sticks out the most

    18. Upon learning that VOLUMEDRIVE was illegally removing the Leased Equipment from the BurstNet Building, BurstNet changed the locks on the building to prevent further removal.

    I did not see anywhere in the paperwork that restricted them to keeping there equipment in a specific location.

    But still just because someone filed a lawsuit does not mean everything they claim in court is 100% right. Yet still a good read. Maby someone will go to the hearing since they most likely are public?
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