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Extortion and the UGO Network?

Cliff posted more than 12 years ago | from the show-me-the-money...that-you-OWE-me dept.

The Almighty Buck 239

An Anonymous Webmaster asks: "I'm the webmaster of one of the largest websites on the UGO Network. This past month UGO gave notice to all affiliates that they say all guarantees are gone and will only make payments up to February's ad traffic at half rate. Yes they are currently 2 months behind on payments. (This includes HardOCP, ShackNews, BluesNews, VoodoExtreme, Telefragged, OldManMurray, my website and many others. UGO handed out contracts last week saying we must forfeit all our rights to previously owed money and rights to sue them to get those last 2 checks. Yes that's right, if we don't sign a paper saying we wont sue them they will withhold 2 months of payments they already owe and have available to them. Does anyone have any realistic advice for all these webmasters? A lawsuit just doesnt seem like it would really net any cash." Now this just doesn't sound fair at all. It's a shame that these big site networks aren't able to pay their sites what's owed, but is such extortion really the answer? I'm sure many webmasters may have found themselves in this position before. What did you do to resolve this kind of problem?

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239 comments

UGO? IGO. (1)

Anonymous Coward | more than 12 years ago | (#219322)

At the minimum, it seems that UGO is telling all of its clients to go away. It's probably better to take the money that's being offered and go elsewhere, as if they lose all their clients then all the future money is gone.

UGO lies! (1)

Anonymous Coward | more than 12 years ago | (#219323)

Phillip Morris and R.J. Reynolds kill every single pack

McDonald's sues London Greenpeace for presenting the public with the facts

Disney expands its international market with help from the CIA

Coors uses consumer support to help finance the KKK

Ending oil protests with executions Nigeria belongs to Shell

Pepsi dealt with the oppressive regimes in the Phillipines to build another Taco Bell

General Motos creates competition with their "whipsawing" tactics role

Dupont alone is responsible for four percent of the ozone layer hole

Don't sign, file in small claims court. (1)

Anonymous Coward | more than 12 years ago | (#219324)

Don't know what the limit in your state is but it varies from state to state anywhere from $250 to $5000 per claim. If they pay you monthly, you can break up the total amount into seperate claims for each month. File them a couple of days apart so that they'll get assigned to different days for the hearings. Ugo will either have to send a lawyer to represent them (for a week or more) or risk a summary judgement against them for non-appearance. Your state then sends them a notice of finding (guilty, of course) and even if they go out of business, you're first in line to claim their assets under the bankrupty laws. (court judgements always get first claim to any forfetures.) Remember, they can't screw you, I mean, change the contract without your permission.

Call their bluff (1)

Anonymous Coward | more than 12 years ago | (#219325)

Call their bluff. Do not sign anything. Send them notice via certified mail that they breached contract, and after 30 days, if you do not get resolution, notify them you are terminating it, and call a collection agency. That's the advice I gave to someone else in this boat, and it worked.

DEBT FOR EQUITY!!! (5)

Anonymous Coward | more than 12 years ago | (#219330)

I can't believe you're not considering filing suit. Take a close look at your current contract and contact a lawyer. Some of the websites were mentioned in the summary: HardOCP, ShackNews, BluesNews, VoodoExtreme, Telefragged, OldManMurray... Get these guys organized, start a lawsuit toghether, and squeee UGO where it hurts. I dont know what other debts they owe, but it seems they're trying to extort you guys in favor of "larger, more powerful" debt holders. If thats the case, as a group, you may be the largest debt holder. Do not give that up for free. You should be able to force UGO to trade the debt they owe you for equity in the company. Im sure the smart and savvy people running these websites could do a much better job of running UGO.

so whatever you do, DO NOT SIGN ANYTHING LIMITING YOUR RIGHTS! This contract is written by their lawyers to do one thing.. !@#%!@#$ you over!

GET ORGANIZED with the other large web sites, and put forward an organized front. UGO can bully you guys one at a time, but not if you all stand together.

You're already looking at lost money from UGO, more is obviously on the horizon, so whatever they're trying to withhold now may be just the trickle before the dam breaks. Forget about actually getting paid in dollars.. they dont have any.

If you go to trial, or seriously threaten such.. they will likey reconsider, and may try to work out a debt for equity swap were you get like 50 cents on the dollar. Remember, you are their customers.. since its through your web sites that they make money for ads. They can't alienate you to the extent that you pick up shop and leave.

good luck

Re:Well... (5)

hawk (1151) | more than 12 years ago | (#219336)

I am a lawyer, but this is not legal advice. If you need legal advice, go pay for it.


If you want a lawyer fool enough to take a contingency fee on a small amount against a dotcom . . .


I once had someone come in expecting me to *defend* a wrongful death case on a contingency (How would that work? I pay a third of the judgment if he loses? :)


And the one hurt on a motorcycle, expecting me to arrange for "my compensation."--the fool had run into the car in front of him (Unless the vehicle in front of you disabled its backup lights and suddenly went into reverse, the fact that you collided with it is conclusive evidence that you were following too close . . .)


hawk, esq

Tried taking a baseball bat to their knees? (1)

bobalu (1921) | more than 12 years ago | (#219337)

That's the preferred method of dealing with scumbags where I'm from.

Seriously though, you obviously need to have your lawyer call them. If they owe you money under one contract you don't need to sign another one to get it. If the money involved isn't worth an hour of legal bills, then sign and forget it.

Whaddaya want fer nothin', rubber biscuits?

Wow, this means GameZero is one step closer... (1)

gmezero (4448) | more than 12 years ago | (#219342)

to being both, the first and last videogame magazine web site on the internet. ;p

Now, if I could only get a new group of writers to do reviews and articles! Sigh... for nothing more than a job reference... geee, what happened to the days when a job reference held inherent value in and of itself?

Re:UGO? IGO. (3)

_14k4 (5085) | more than 12 years ago | (#219344)

See, the thing is. Who knows if UGO even has the money for the last two payments. Going on past history, they're just stalling the lawsuits.

_14k4

www.poorheart.com

Re:Can't Get Blood From A Stone (1)

tomblackwell (6196) | more than 12 years ago | (#219345)

OK, I was a bit sloppy. When I said "no amount of complaining, emailing or suing will get you cash.", I should have ended with "any significant amount of cash". The problem is that, when most internet companies implode, they do it much more quickly and successfully than older-style companies. There may be a few scraps left over, but they probably won't add up to much, especially if you have to pay any fees to go get them.

The "Pennies on the dollar" that you refer to will probably end up being less than what they can get if they take the money and run now.

Can't Get Blood From A Stone (5)

tomblackwell (6196) | more than 12 years ago | (#219346)

Many of these ad networks have business models that guarantee that they will eventually fail.

If they are forced to go out of business, no amount of complaining, emailing or suing will get you cash.

I'd chalk it up to experience and move on. You may use this as an opportunity to exit the web, as you may find (as your network did) that it's much harder to run at a profit than it was a year or two ago. Tough conclusion to reach, but it's better to reach it with a few bucks left in your pocket.

Re:Bad advice (1)

DavidTC (10147) | more than 12 years ago | (#219348)

There is a big of a difference between terminating an agreement without payment and refusing to pay (with or without terminating the agreement) money they already owe.

-David T. C.

Ugh (1)

Zico (14255) | more than 12 years ago | (#219351)

Not trying to offend, but do you know anything at all about class-action lawsuits? Do you know which party is the only party to actually win anything of value in these things? What on Earth even made you suggest this?


Cheers,

Sue, Grabbite and Runne... (1)

maroberts (15852) | more than 12 years ago | (#219353)

Sue for non-payment, if you don't get your money at least you'll stand a chance of eventually closing the b*stards down.

In England (not sure what the situation is in US) I believe you can start court proceedings to close the company if debts are unpaid. Small companies use it quite a lot to force slow paying larger companies to send them a cheque!

Gleaning the Pube. (3)

Stepto (25864) | more than 12 years ago | (#219364)

The days of getting paid 6 figures a year (or even five) for cutting and pasting news, or using the words "pimpdaddy smackdown" on your website is way over. It's a wonder UGO lasted as long as they did. Those who are smart, like OMM, saw the writing on the wall and made contingency plans.

God knows what someone like Blue is going to do. Of all the sites, his is the most useful gaming cut and paste site on the net.

The problem has been, and will continue to be, the cost of bandwidth. Serving out 100k hits a day or greater just costs way too much money for an independent person to deal with unless they are independently wealthy. One good /.'ing of your site, and your in hock to you ISP for thousands of dollars if you are running sko more cost effective co-lo. This makes networks like UGO sort of a required thing.

But networks can't exist on ad banner money alone, and users expect the web to either be free or, failing that, MASSIVE bang for the buck.

I still maintain that the furure of these networks is to offer massive content at a yearly subscription rate, paying affiliates by continuing to use ad banners. How would it work? Like this. Say an ad banner network, GAN, has 50 affiliates. They offer full access to all 50 affiliates for 9.95 a year. (here's the massive content/bang for the buck part) Now since the network cant survive on that alone and pay their affiliates, they also offer one single ad banner on their affiliate sites (at a rate much lower than has been done previously) and they pay their affiliates that way.

For those who say "no fucking way I'm paying a yearly subscription and still put up with ad banners", well that's how magazines work. You pay your 4.95 for newsweek or "out" magazine AND LO AND BEHOLD! The mag ALSO has advertisements. And newspapers work the same way. And fucking paying for cable TV doesnt stop the commercials. Jesus, they even play commercials in front of movies in the theater now. Buck up and get with the fucking program hippie. The web isnt any different.

Will Blue (or even the /. guys) continue to make a living this way? Probably not, he'll have to get a day job or start selling original content. But at least the sites will continue for those who want to run it as a hobby, and they wont have to worry about bandwidth costs.

To think that anyone could make a living, or even deserve to, simply posting links readers send in is a little ludicrous. And yeah I understand the irony that that is exactly how /. works.

S.

Don't give up your rights (1)

Schlaegel (28073) | more than 12 years ago | (#219365)

They made a promise that they are now trying to break. Don't be seduced by the quick cash settlement. Stand your ground.

If it is not possible to get a lawyer or you just don't want to get a lawyer then here is some advice.

Don't make any aural arguments or aural agreements with them. Do all correspondence in writing. That way you have a record of all that is said. It will also remove the ambiguity, emotion, and give all parties time to think through their responses.

Get your final agreement signed and on company letterhead. Don't give them a way out.

They are breaking the contract; most contracts include sections detailing what to do if the contract is broken. Read and re-read the contract.

Quote the contract, their documents, and their correspondence to you in your written correspondence to them.

Good luck.

Re:class action (1)

bbleier (35947) | more than 12 years ago | (#219372)

Defrauded ... "bent over for legal fees."

What is the fraud?
They said they would pay, and then the didn't. Right. Sounds more like business failure than fraud. Well they offered more than they could pay! Would that be closer to "irrational exuberance" or the same dream world that made the sites themselves believe they were worth this kind of money.

This is business failure, and there is going to be a heck of a lot more of it! As someone said above, get used to it. As to the legal fees, all claimants should be faced with being "bent over" for legal fees, they might actually do a cost benefit analysis of whether litigation was worthwhile, instead of clogging our courts with fantasy litigation!

Extortion?! Try bankruptcy court (2)

bbleier (35947) | more than 12 years ago | (#219375)

While I can understand your frustration, this is NOT extortion. For what it's worth, it is called a settlement. They are offering to compromise debts for lesser amounts. Welcome to business 101. Forget the attorney, he'll probably just cost you money.

No, you could always wait 'till they file bankruptcy, and then wait, as an UNSECURED CREDITOR, to see how much is left over to pay the debt to you. What, you've never had a customer file for bankruptcy before?! This is just the beginning!

what about the day after? (2)

coyote-san (38515) | more than 12 years ago | (#219379)

If the contract was terminated and the only question was whether to accept partial payment or fight for more, your analysis is reasonable.

But as I read the question, this guy is being asked to accept a unilateral, retroactive change to an existing *and ongoing* contract. If his company agrees, what's next? They'll have no grounds to complain when the company retroactively cuts payments in half again in 6 months, then again, then yet again. Having gotten away with it once, why on earth wouldn't the company try the same trick again?

Worse, by accepting this it's possible that his company is setting itself up for a lawsuit for "breech of contract" once it decides that enough is enough and tries to yank the ads before the end of the contract. Right now, it's likely that the other company has breeched the contract and his employer can yank the ads without risk. (The details, as always, are in the contract.) Once they've demonstrated a willingness to honor the contract despite non-payment, they might lose the right to consider non-payment a material breech in the future.

IANAL, and I'll be the first to admit that this is one of those cases where you need to bring one in. Not to tell you what assholes the other guys are, but to tell you what you need to do to keep your options open in the future.

P.S., if we are talking about an ongoing contract, the money at question isn't just the late payments. It's also half of every payment through the end of the contract. A lawyer might be able to make a good case that *this* is amount of money in question in any suit, plus treble damages for breech of contract.

class action (3)

Sogol (43574) | more than 12 years ago | (#219381)

UGO obviously anticipate a class action and are trying to limit the number of class members with the waiver. You could wait and see if anyone else initiates a class action suit, and then become a class member for little or no legal expense. Here [web-access.net] is the general idea of how this works. Here [localbusiness.com] is a bunch of BS ,about how rich UGO will be by 2001 ;)

heh easy solution: (1)

Clay Mitchell (43630) | more than 12 years ago | (#219382)

sign the contract, get your 2 months of pay, and then sue them. obviously, contract don't mean squat.

anyone want to give probability / payoffs? (1)

mike_the_kid (58164) | more than 12 years ago | (#219388)

The problem with signing this new contract is this:
You had a contract with them where they were going to pay you $x.
They say "Look, we've hit some turbulence, if you sign this new contract where you forfeit your rights to $x we will pay you $y (y x)."
Most of the responses here are saying "cut your losses, take $y, move on." The problem here is that there is no guarantee that you will get $y.
Let us say that you sign that contract, taking $y in exchange for not sueing them. As soon as you sign it, whats to stop them from saying, "Ok, last time this is going to happen, but you know the NASDAQ these days, if you promise not to sue us for $y, we will pay your right now $z (z y x).
So you could do one of three things:
1. Sue them right now. Upfront legal fees, no guarantee of ROI (if they go bankrupt before you settle, you paid the legal fees for nothing.)
2. Class action law suit. No legal fees, no guarantees on your money except that you know it wont be close to what you were originally owed.
3. Sign their new contract. Looks like the best option, but there is no guarantee that they will be able to uphold their end.

(whatever you do, do not go for the option involving their executives, a desert eagle .50, and inevitably, the NYPD).

Employees, affiliates, what's the diff (3)

heiho1 (63352) | more than 12 years ago | (#219390)

I worked for a company which was a subsidiary [of sorts] of UGO. Well, after working for them for a while, I gave them a month or so of notice. A day or so before I left, I received this threatening letter basically saying that I agreed never to say anything negative about UGO and gave up my rights to sue them for practically any reason and that I agreed to pay any bills which they might have outstanding for me. Well...(@#*&#$ that! I basically told them that there was no way I was going to sign over my constitutionally protected right to state my opinion about them nor was I going to sign a blanket statement agreeing to pay for possible money their accounting department might decide that I owed them. I told them they could send me an itemized list of dues that I owed them and I would discuss those items with my accountant and that if they had some desire to sue me, they could notify my lawyer of their intent. I also told them that all further such correspondence should be sent via email rather than fax [as in, I don't have a fax!]. Their HR department tried to reach me by phone after that [to assure me the contract was harmless of course :-?]. After that sort of draconian gag attempt, I'll never deal with them again...

counting crows (2)

joq (63625) | more than 12 years ago | (#219391)

One of the reasons I've never bothered with ads on my sites is because one of a few reasons. 1) I feel its whoring myself, and a site shouldn't have to place ads on their site if their content is good (I push 2-4mill hits a month at times 700k-1mill unique) 2) Don't want ads which aren't themed in accordance to my content 3) companies are crooks.

So let me elaborate on number 3 since it may offend many people who do place ads. Trying to find a surefire method of advertising in these economic times are murder. With so many companies getting tossed, its only a matter of time before most of those "place a banner get paid companies" become completely extinct.

Their business models are often far fetched, marketed with obscurely written hidden agendas to those posting the ads, and there is really no legal measures you can take to defend yourself.

So lets see you place a banner from a company promising x amount of dollars per x amount of hits. Which means unless your pushing mega traffic its usually worthless to the average site. So you now believe you should take them to court, and now have to evaluate the math by doing that. Court costs for instances like this would be astronomical and often cost you more than you would get in return, not to mention drag on for years before you even get anything, PROVIDED, PROVIDED, that the company doesn't go under...

Wow thats a lot to expect to look forward to when dealing with these companies. Maybe some sites should promote advertising to companies on their own. Provide statistical information for their sites, via methods of logging, then promote the sites on their own. You cut out the middle man and the creating of your own banner generating script is not that hard.

Anyways I stay away from all that crap...

Re:So how... (2)

joq (63625) | more than 12 years ago | (#219392)

Understandable that many sites would need to pay for hosting, but this is something that should be thought of beforehand by the webmasters. My own site is a hobbyish site, and personally I would rather pay for my own (even though I have free hosting via a good friend [siliconinc.net]) then pimp out with banners only to get shafted down the road.

Its one thing to create a site for your own purposes, then expect others to save your ass via way of advice on how to make money. As I stated if your content is that good, let the stats speak for themselves, post your stats, create your own terms for advertising for companies to look at, and I'm sure somewhere down the line you'll get play.

Listen, I get propositioned by companies involved in the security biz sometimes, and I decline most of their offers since they seem quirky. Show me the money, then we'll talk. If someone is dumb enough to fall for a takl for us, and we'll pay you later deal, then they deserve it. Rule number one in business there are no freebies, and no one is your friend. Once you learn to master that rule you'll be successful with all of the others.

Banner ads are dead. (1)

llzackll (68018) | more than 12 years ago | (#219395)

Nobody is making money on them anymore. Cnet and other sites have resorted to giant flash ads in the middle of their content. I doubt anybody clicks on these either. Now is not a good time to make money on the internet, unless you are actually selling a product to your web site viewers. Basically, I wouldnt sue these UGO guys. They obviously are out of money and will probably die off soon.

There's not much you can do. (1)

jmccay (70985) | more than 12 years ago | (#219396)

I had something similar happen when I was working for a company (not the one I am presently working for). The only difference was it was the company tell me if I didn't sign I wouldn't get the money. Our parent company had gone through two rounds of layoffs, and the final manager of our company got our parent company to agree to a contract stating if the laid off any (or all) of the remaining employees with a year or two, the company would be required to give us X months severence pay.
Needless to say, they eventually let us go. Before I could get the severence check they were obligated to give me under the contract, I had to singn a similar agreement stating I would not sue the company. I wouldn't make any money sueing so I signed.
If thy are doing this to your website, look for space elsewhere! This is NOT good news for this company. You are better off finding a better sight. It sounds like the company is running out of money, and you don't want to be stuck when they go under and somehting happens to the content of your website.

See lawyer - say "class action" (2)

Kefaa (76147) | more than 12 years ago | (#219399)

I would avoid signing anything without representation. If this was really sent to all of their customers, many who will be small, or like you unable/unwilling to go to court, organize. Contact a lawyer, explain the situation, and see if they are willing to contact others on behalf of some combination suit.

Most important, I would avoid taking any legal advice from here. Even if I was a lawyer (I am not), nothing says I am a good one or even know what I am talking about.

Re:Can't Get Blood From A Stone (1)

KenSeymour (81018) | more than 12 years ago | (#219400)

This is not quite true. IANAL but, I beleive that if you file in court before they file for bankruptcy, then you can a portion of what cash is
paid to creditors when they are forced to liquidate
their assets.

The idea that it is impossible to get any money because they are broke is false.
They have equiment they can sell off if they are
forced into bankruptcy.

You may get pennies on the dollar, you may get nothing. You will probably have to wait a long time.

Accepting their offer might be a better deal.
Talk to a lawyer. They can tell you what to expect.

looking for cash or satisfaction? (1)

/tmp (84345) | more than 12 years ago | (#219402)

The real answer depends on what you want in the end.
If you are looking to maximize your cash intake then just take what you can get now. IANAL but my rough thoughts on the amount of money you get work out this way:
1- you take the money offered - you end up with 50% of what is owed
2- you sue - most lawyers are probably going to take 1/3 of the settlement, plus there are court costs, your time and agravation, the chance that by the time the courts hear your case there is a company left to sue or they have any money left to take. if you're lucky you may end up getting a little more than the 50% they offered, you may end up getting less or nothing at all and you spent alot of effort to get it.

of course if you are looking for satisfaction and the cash is not a big factor then sue the bastards and make life tough for them.

A rock and a hard place.... (3)

King_TJ (85913) | more than 12 years ago | (#219404)

It sounds to me like they're basically saying "We'd like to offer you two choices. Either take these last 2 payments we owe you and call it a done deal, or fight with us in court about it." They're betting you don't want to bother with the court battle.

It's completely up to you. You'd have a good case, except you can't get money from someone who has none. Go talk to an attorney who can investigate this place and find out if a suit is worthwhile. I don't think any Slashdot readers can give you better information than that, unless maybe they work for the place themselves.

Re:Can't Get Blood From A Stone (2)

jarran (91204) | more than 12 years ago | (#219405)

If they go bankrupt, and their is equipment is sold, the following happens:

  1. The government takes any money it's owed (taxes).
  2. People with SECURED debts take their money.
  3. People with UNSECURED debts take their money. (This guys debts are almost certainly unsecured)

IANAL, but I just took a short course on business finance - we were told that when companies go under, people with unsecured debts tend to get around a penny in the pound back.

Take the Money and Ditch UGO (2)

briancarnell (94247) | more than 12 years ago | (#219410)

A lot of this depends on what the contract is committing you to. As long as you're not in some sort of exclusive relationship with UGO, I'd sign the contract, get whatever I could out of UGO, and then ditch them.

If you are on some sort of exclusive deal, refuse the money and the contract and ditch UGO immediately for being in breach of contract.

There's no excuse for this (1)

Mr.roboto (112555) | more than 12 years ago | (#219422)

Lets say I owed someone money for a house or a car I bought. If I was to run into hard times, say I took a nasty paycut or something, would it be an excuse to have the amount of my loan reduced? Heck no! I made an agreement with the second party or parties that I would pay them back X dollars, and X dollars is what I owe them. Just because I've hit hard times doesn't mean I shouldn't live up to my responsibility. Somone said in an above post that they bought out blah blah blah ad network. If this is true, then what they are doing amounts to pure greed. They're trying to have it all, at their customer's expense. This should be tried criminally under breech of contract laws as far as I'm concerned, if they're going belly up then they should just come out and declare they're dead in the water and bankrupt then try to fullfill the obligations to their customers.

Extortion? (1)

KingAdrock (115014) | more than 12 years ago | (#219425)

This seems like extortion to me. Is it legal to force someone to sign a contract in order to get what is already legally theirs? I assume that all of the webmasters had signed an initial contract with their percentage of revenue and whatnot.

Sue now, why wait for the rush? (1)

kperrier (115199) | more than 12 years ago | (#219426)

Don't sign and sue them now. Get some lawyer to take the case on contigensy. Talk to the lawyer about makeing the case a class action lawsuit.

Kent

A similar situation (1)

MrResistor (120588) | more than 12 years ago | (#219431)

...except it isn't a .com, but related...

Anyway, the company I work for is being stiffed for a fairly large some of cash (large enough that I probably won't be getting a much deserved raise out of my now 3 weeks late revue) for some prototypes we built for another company. The situation currently is that if they don't pay up by Friday we get to go over there with a big truck and take stuff.

Now for the advice, sue them. They are obviously in breach of contract and a lawsuit will likely award you some assets. "Assets" doesn't have to mean cash. It can also mean furniture, computers, company cars, basically anything that is owned by the company. If UGO is typical of the .coms I've seen, they have some sweet stuff that could be yours...

&#139homer simpson&#155Mmmm... High res micro-mirror projector...&#139/homer simpson&#155

Re:They *HAVE* to do this to stay in business. (2)

malfunct (120790) | more than 12 years ago | (#219432)

I want you to come work for me. If you don't mind me not paying you for 4 months and then just jump on board when I demand you sign a contract after the fact absolving me of having to pay you any further money then you are the perfect employee.

Bottom line is that the company signed into a binding contract and they SHOULD NOT be let out of that contract. If you can't do business the way you promised you shouldn't do business at all. Stealing services from someone else is wrong and should be procecuted.

The unfortunate bit in all of this is even if you win the lawsuit the chances of you getting any money are slim because it sounds like the company doesn't have any. I'd say sue them (nearly any lawyer should be able to win this case for you if the facts are as clear cut as you say though IANAL) and find a different means for revenue on your site.

Go to collection (5)

Animats (122034) | more than 12 years ago | (#219434)

Dun and Bradstreet [dnb.com] operates a commercial collection service, for collecting from deadbeat companies. They charge about 20-25% of the amount recovered. For big-dollar amounts, that's negotiable. They're the biggest company that does this. Since they're also a credit rating firm, they have real clout.

Even if your creditor goes bankrupt, you'll probably collect something. And you may be able to force them into bankruptcy before they totally run out of cash, so it's better to start sooner rather than later.

As a rule of thumb, never let a commercial creditor get more than 60 days behind. The probability of payment declines rapidly after that point.

Banner advert blindness (3)

DrXym (126579) | more than 12 years ago | (#219441)

I suspect the bottom has fallen out of the advertising business because people have conditioned themselves to see everthing on the page except the adverts. I know I have. I look above, below and either side of but the not *at* the advert.

That could be why an increasing (and increasingly desperate) number of sites have taken to displaying popup windows instead. Unluckily for them people will ignore these too and become alienated from the site in the process. I already unconciously close popups before they've even finished loading.

They *HAVE* to do this to stay in business. (1)

vor (142690) | more than 12 years ago | (#219449)

If you sue, you *Might* get your money, but it's not worth it. The legal fees will only further harm an already cash strapped business model. You might get your money now, but you'll bring down the 10 sites they sponsor with it.

Remember these ad based companies are starving, they don't have much cash on hand at all. This is a very drastic decision for them and they wouldn't be doing it if it wasnt an absolute necessity.

My advice is take the lower money and be happy you're getting anything at all. This is a very rough time for banner ad companies

Sue them (1)

pallotta (143747) | more than 12 years ago | (#219455)

They're obviously not as scared as they should be about getting sued. If the notice says "don't sue us, or else" then they have a problem. That can be exploited.

If nobody does, and opts for the money right away, then doing web business will instantly get a lot tougher.

Besides, if you sign this paper, is there a guarantee that they'll give you any money?

Cant wait (1)

magnetx11 (152596) | more than 12 years ago | (#219456)

for the usual "Chet from OMM" bitch about how "banner adds rock", and the cuase of thier cashflow problems are becuase people block ad.*.com

Class action? (1)

Matthaeus (156071) | more than 12 years ago | (#219459)

This does sound like an ideal case for a class-action lawsuit--unless, of course, if UGO is going belly up you're all going to get a rather paltry sized settlement, but it'd be better than buckling under.

Re:Dear Slashdot, (4)

jayhawk88 (160512) | more than 12 years ago | (#219462)

Dear Anonymous Coward,

Sometimes, in real life, people are confronted with situations where they don't know what to do. In such situations, they generally seek out the advice of their peers and colleagues, people that perhaps have been in similar situations, before making a decision that could possibly affect the rest of their lives. It's called getting as much information as possible, and doing everything within their power to make an informed, wise decision.

I know this is probably difficult for you to comprehend, since you were apparently born with the sum total of all human knowledge, but try to understand that this is very helpful for the rest of us.

Even Rats Know When To Leave A Sinking Ship (1)

ReidMaynard (161608) | more than 12 years ago | (#219464)

take the 2 months $.

I'm betting the boys at the TOP of the UGO corporate structure have already bailed. This 2 months offer is a pittiful attempt by underlings to be fair before their boat sinks.

Re:UGO? IGO. (1)

jebrick (164096) | more than 12 years ago | (#219466)

I would talk to a lawyer but IIRC you can not sign away your rights. That "contract" is not worth the paper it is printed on. You can not sign away your right to sue or take legal action.

Maybe this law doesn't apply to dot.coms... (2)

Kjella (173770) | more than 12 years ago | (#219467)

...and I don't live in USA...

...but I'd normally file a bankrupcy (they owe me money, I can prove it, they don't pay it, last I checked that ment they are bankrupt) and ask the court to immidiatly seize funds and/or assets to cover the money owned so all is not lost, even a dot.com usually has something worthwhile.

Besides, that usually provokes some rapid action from the counterpart, unless they're really going bankrupt, in which case you'll probably lose the money anyway, so the earlier you try, the more likely there'll actually be something to get.

Kjella

[Sigh] Ugo Contact info (2)

Alien54 (180860) | more than 12 years ago | (#219470)

The pretty corporate pictures are here:

http://www.ugo.com/services/about/mediakit/coinfo_ exec.asp

The contact infomation is here:

http://www.ugo.com/services/about/mediakit/ contact .asp

with telephone, fax, and email.

Someone may want to save the data someplace, just in case. These guys sound a bit unpleasant, but I'm sure they are fine at a party.

[right ...]

Check out the Vinny the Vampire [eplugz.com] comic strip

Re:UGO? IGO. (2)

Wavicle (181176) | more than 12 years ago | (#219471)

If this is true you are unlikely to get any money whether you sign the letter or not. If you sign the letter and they do not pay - they've broken the contract and you have the right to sue them again. If they don't go bankrupt (meaning there is still somebody to sue), you may get punitive damages because they used the letters as a fraudulent tactic to allow them time to reorganize (Chapter 11 is what they are supposed to use if they need protection from creditors so that they can reorganize).

I still see no disadvantage to signing the letter since I don't see how anyone is going to realize the full amount owed.

Re:UGO? IGO. (3)

Wavicle (181176) | more than 12 years ago | (#219472)

I don't see why so many people on slashdot not in this situation are sue happy. Perhaps because the advice here is usually worth the amount you pay for it? The lawsuit angle is unlikely to get you any more money than just signing the paper, taking the money they will give you and going elsewhere.

I agree with what the previous poster said. Take the money and run - lawsuits take time and energy and one against a failing company may yield little more than a micro-thin slice of the bankruptcy settlement.

Depending on your financial situation, you may be able to write off the other half of the money as a loss or bad debt allowing you to recover 25% or more of it in reduced tax obligation.

Re:Well... (3)

Wavicle (181176) | more than 12 years ago | (#219473)

The problem here is that lawyers cost money - a minimum of 1/3 the settlement amount.

The best advice I think is to take the 1/2 and write off the rest as a bad debt / business loss. You'll likely end up with a minimum of 62.5% of the total money owed (depending on your tax situation you could get more). If you go the lawyer route, you will get no more than 66.7% of the amount owed.

Is the 4.2% extra you get worth the lawsuit? Especially considering the amount of work you will have to put in and time you will have to wait? And considering the risk that if the company goes belly-up before your case is settled you will probably get nothing...

No one-sided contracts (2)

Erasmus Darwin (183180) | more than 12 years ago | (#219474)

While I'd idealistically wish that you could nail them to the wall, as many others have pointed out, you're SOL if they go bankrupt. Add to that your legal fees and it just isn't a winning proposition, especially if 2 months payment isn't all that much money in the long run.

However, provided you're willing to consider legal action, you might be able to get away with having your cake and eating it too, by signing the contract and then arguing that the contract was valid. In addition to the obvious extortion, it's my understanding that, to be valid, a contract must provide consideration to both parties.

The example I recall from my business law class involved a rich uncle signing a contract with his nephew, where his nephew agreed not to engage in various illegal behavior and the uncle would provide the nephew with a bunch of money after a set amount of time. Because the behavior of the nephew fit within what he was already required to do by law, he wasn't really doing anything for his part of the contract. As such, the contract was declared void. Since UGO is already contractually obligated to pay you this money, they aren't providing you with any considerations in this contract. Of course, this would be contingent on the details on the contract (for example, it might provide some small additional benefit to you that wasn't mentioned in the summary, thus negating this whole argument). All in all, the obvious IANAL disclaimers apply, but it might be something worth thinking about and asking a lawyer about.

Hate to say it (1)

Tebriel (192168) | more than 12 years ago | (#219478)

But I think a lawsuit is what's needed here. I would first contact other webmasters in the same situation and see what they say. Also, if you can get them on your bandwagon (whatever you decide) and present a united front of all of you, that should provide greater impact. Just don't go it alone.

Small claims (1)

OverCode@work (196386) | more than 12 years ago | (#219480)

Check to see if the amount they owe you is under the limit for small claims court in the state of the contract. In California I believe it's around $5000.

IANAL, of course, and thankfully I've never brought someone to small claims, but it exists for this type of situation.

-John

Move on (1)

jchristopher (198929) | more than 12 years ago | (#219481)

Look, they obviously aren't going to survive. It sucks to lose out on the cash, but unless it's a ton of money, forget about suing them.

Even if you won, they'll be bankrupt soon, and you'll be lucky if you collect 10 cents on the dollar.

Invest your time in finding some other way to keep your site going instead. Live and learn.

So how... (1)

Mactire_Dearg (211446) | more than 12 years ago | (#219485)

...do you pay for the hosting and bandwidth for your site. Any legit site needs more than what a freebie hosting account could offer.

I hate bringing up the evil M-word (money) but it's needed to support sites...

where else to go? (2)

Mactire_Dearg (211446) | more than 12 years ago | (#219486)

I was in the same boat and signed the contract just because I _needed_ the money for backdue hosting bills.

However, the contract is pretty weak and could be voided in a class action. Question is where else to go? I dont know of any place else to go for ad outsourcing. As much as we all hate it we need to make some money just to pay for the basics of our sites. Free hosting just doesnt offer enough (ie MySQL, specific Apache changes, etc, etc, etc) and hosting and bandwidth arent cheap.

Before we all leap off the cliff and sue them into non-existance maybe we should have somewhere to land....

There was an article on here awhile back about improved advertising. Dont suppose anyone's done anything with it or thought about forming a co-op for sites too big to be on free hosting and too small to afford our own ad sales staff?
Anyone interested in such a thing? How'd we go about getting startup capital in the current market?
I suppose it'd be a bit much to get OSDN to sponsor the co-op...

eFront did the same thing... (2)

verbot (215901) | more than 12 years ago | (#219489)

Remember the whole eFront fiasco [slashdot.org] from a few months ago? Well, eFront did the same thing as UGO is trying to do: in order for webmasters to get back to their domain names, they had to forfeit 5 months of backpay, and agree not to sue eFront at any time in the future. As far as I know, a lot of webmasters agreed and signed the contract in order just to get their domains back quickly, as one weekend eFront blocked out all webmasters from updating their sites for "security reasons".

Looks like UGO is on it's way to becoming a member of Pud's list [fuckedcompany.com]...oh wait, nevermind...Pud has an article that UGO just bought Bla-Bla! [ugo.com]. Sheesh! Rough times indeed...

What 'Cho Talkin' Bout, Willis (2)

Darth RadaR (221648) | more than 12 years ago | (#219493)

They're holding back payments because they're trying to save [eonline.com] Gary Coleman. Once Mr. Coleman's debt is handled, it'll be business as usual.

Re:Dear Slashdot, (1)

frankrachel (224667) | more than 12 years ago | (#219495)

I agree, but for something like this, it is *obvious* that you should speak to a lawyer right away.

Re:They *HAVE* to do this to stay in business. (1)

Mn3m0nic (234085) | more than 12 years ago | (#219502)

I have one question for you. Do you work for a banner ad company? Maybe even UGO?

nice logo (1)

IdentityCrisis (235840) | more than 12 years ago | (#219504)

Heh, always thought the UGO logo looks like a fascist symbol...
I guess we all now know where they got the idea for that logo :)

UGO are dirty whores. (1)

Hercynium (237328) | more than 12 years ago | (#219505)

Now, I'm not trying to start a flamewar, but if they're going down, and they're taking you down as well, you might as well sue them out of existence.

I had to take a similar course of action with a certain cynaptec.com [cynaptec.com]

They had to change their name [purchasenet.com], but even that didn't save them (page is still up, but they had to move out of that cozy office, heheheheh)


BTW, their server is FULL of security holes! [I'm not advocating hacking them, just suggesting it :^>]


Oh, I might add that their little extortion note is in no way legally binding, at least here in Massachusetts. (Cynaptec sent me one of those as well, heheheheh)

Roll the dice (1)

PhipleTroenix (240551) | more than 12 years ago | (#219507)

IANAL. Have you asked to see their books? I wouldn't sign anything until they proove how bad their trouble is.

If they are going broke, what is the point of these tatics? They should just close the doors.

If they are NOT on the verge of going broke. You want ALL your money.

If it could go either way, bankrupcy should provide you with something.

I doubt they are doing this to be nice.

Re:Three words... (1)

bstrahm (241685) | more than 12 years ago | (#219508)

Don't go the class action lawsuit route... Why do you want to share your winnings with other webmasters that aren't smart enough to do it on their own. What you do is quietly get a lawyer, draw up an lawsuit suing them for millions, then settle for 3-4x what they owe you... This way you end up with a check in the amount that UGO owes you, and everyone else gets nothing (because there is no money left) Now if you go the class action route, lawyer gets 1/2, and the rest of you split a pool of diminishing money. I also would pay the lawyer upfront rather than on contengency, you get better work, and you get to keep your winnings

Professional agencies want cash up front.. (2)

Shivetya (243324) | more than 12 years ago | (#219509)

so now you know why!

Bunch of dummies, for the last two quarters advertising companies are demanding cash up front for producing content/ads for web companies. A lot of other companies demand the same from any web based enterprise.

Why do web based enterprises think they are immune from the same treatment? Just because your both web based doesn't mean you have some secret handshake protecting you.

You would have thought the guys at VE would have learned by now.

Suggestion, get all these sites together and file a single lawsuit. In the meantime don't run their ads

Fan sites just don't have the clout. (2)

Shivetya (243324) | more than 12 years ago | (#219510)

Unfortunately even if they take the cash they are in the same boat. They don't have the clout to demand payment up front, and they probably never will.

If anything these these sites need to band together to put a stop to the abuse foisted upon them.

I am quite sure the executives at UGO are highly paid, and protected if they should be let go. Its crap like Webvan's recent settlement with their EX-CEO that show who really benefits on the web, http://news.cnet.com/news/0-1007-200-5940466.html? tag=nbs

Hopefully they will piss off a site that has connections, and get their ass handed to them legally.

Until then, fan sites will continually be screwed. The net isn't free, and if we want good sites we are going to eventually have to pay (even if its micropayments - I would not mind paying a few cents per day to these sites for their content)

Re:class action (3)

Bonker (243350) | more than 12 years ago | (#219511)

I was also going to suggest that this sounds like a case where Class Action Suit would be appropriate. UGO is defrauding a *lot* of people. Now, in the case of a class action, you probably won't get a lot of your money back, but I think you also don't get bent over for legal fees if you are a participant.

Re:They *HAVE* to do this to stay in business. (3)

RareHeintz (244414) | more than 12 years ago | (#219512)

Remember these ad based companies are starving, they don't have much cash on hand at all.

Yeah, but that's not his problem. They owe him money, and they're threatening to renege on their obligations entirely if he doesn't give legally binding consent to let them renege partially.

This is a very drastic decision for them and they wouldn't be doing it if it wasnt an absolute necessity.

If they're in such dire straits, what the hell were they doing acquiring Bla-bla? They should have used that cash to pay their affiliates.

Perhaps they really are out of money, but I have no way to verify that - this may just be a ploy to reduce the amounts they pay affiliates. Either way, it's not the poster's problem, and there's no reason he should put up with it.

Sue them into bankruptcy, says I.

OK,
- B
--

Well... (4)

RareHeintz (244414) | more than 12 years ago | (#219513)

IANAL, YMMV, all disclaimers apply, void in Wisconsin, etc.

If they're contractually obligated to send you the money, I'd suggest that you find a lawyer who'll work on contingency for a portion of the proceeds, and sue them. They're bascially telling you that unless you let them rewrite the contract, they'll break it anyway. That's wrong, and even if it won't net you much cash, there's no reason to let them think they can screw people like that.

I mean, it's one thing for them to want to rewrite the terms of the contract going forward, but this is bullshit - they're attempting to dodge obligations they've made. Such arrogance should not be tolerated. If they can't meet their financial obligations, let the bastards file for bankruptcy like everyone else.

OK,
- B
--

in other news........UGO Raises $13 Million (5)

discovercomics (246851) | more than 12 years ago | (#219514)

From http://www.ugo.com/services/about/mediakit/coinfo_ press_03052001.asp [ugo.com]

UGO PRESS RELEASES

UGO Networks Raises $13 Million; Closes A New Round of Funding with $23 million

New Proceeds will be Used to Grow its Technology Business and Develop Advertising Sponsorships Packages

New York, NY March 5th, 2001 - UGO Networks, a leading entertainment company for 18-34 year old males, announced today that it raised $13 million dollars, closing a new round of funding with a total of $23 million. Lead Investors are GRP and Missouri-based Gryphon Holdings II, LLP Inc. and their investment partners. UGO Networks has raised in total $80 million. UGO Networks consists of UnderGroundOnline (www.ugo.com), a network comprised of 350 affiliated sites which feature content in animation, music, games, wrestling, technology, TV & film, celebrities and UGO Networks Technology Solutions, which provides Web hosting and other professional services to UnderGroundOnline affiliates, strategic partners, and third parties. Board members include Strauss Zelnick, Former President and CEO of BMG Entertainment and Yves Sisteron, Managing Partner of GRP.

"UGO Networks' strength lies not only in the size and composition of its audience, 18- 34 year old males, but in the way in which its unique business model enables multiple revenue streams," said John Wehrle, Managing Partner of Gryphon Investments. "The Company's management team has proven to be extremely adept at leveraging and maximizing all of its internal resources."

"UGO Networks has demonstrated the ability and business acumen not only to survive but to succeed in today's market environment," said Yves Sisteron, Managing Partner of GRP. "The management team is highly adept at both managing cash and generating revenue. The company has had tremendous success in building a base of blue chip advertisers and technology clients."

UGO Networks has overall annual revenues of $15 million.

"UGO Networks will use the new funding to continue operations until our breakeven which will happen before the end of calendar year 2001," said UGO President and CEO, J Moses. "To this end, we are taking cost cutting measures to increase efficiencies in our business."

UGO Networks will use the new proceeds to grow UGO Technology Solutions, its technology business and to develop and sell advertising sponsorship packages.

"As a well funded company, we are looking to leverage our cash position to explore potential strategic partners. An ideal partner would enhance our market position and leverage the Company's core assets," said Joe Robinson, Chairman and Founder, UGO Networks.
....

Simple answer really... (1)

Fizzlewhiff (256410) | more than 12 years ago | (#219518)

Send the head guy at UGO a picture of his kid playing at school or a picture of his wife or mother out shopping. Follow it up with a phone call and say "What a lovely family you have. They look pretty healthy I hope they stay that way, now about this new contract you want me to sign...."

It works in the movies.

Lawsuit? What other options are there? (2)

ocbwilg (259828) | more than 12 years ago | (#219520)

By "last 2 checks," I assume that you mean the checks being offered for January and February of this year. BTW, IANAL. Now, it seems to me that if they are telling you that you have to sign away your "rights" (more like expectations) to being paid for March and April in order to get the checks already owed for January and February, then I think that's a load of crap (note use of high-level legalese). I would hope that somebody in your position would have already had a contract with UGO that clearly defines how you are to be compensated for running their ads (and hopefully the timeframe of said compensation). If that's the case, then it would seem that they're already in breach of contract. Getting you to sign away half the money they owe you in order to get any at all is just a tactic that they'll take because they think that they can get away with it. After all, most of the websites that you mentioned are run by hobbyists or young adults for whom the site is not their primary source of income (nor are they likely to file a lawsuit). Beyond that, I would think that it seriously would call into question UGO's ability to pay you any future money that they will end up oweing you (for May, etc.). Of course, that also calls into question their ability to pay any eventual legal settlement as well. Let's face it, you're dealing with a company that is financially tapped out. You could refuse to sign the new contract and sue for this year's money owed. Odds are you wouldn't get much for your effort and you'd have to pay lawyers fees. You could sign the contract, take the money from January and February and then tell UGO to take a hike. Or you could not sign the contract, not sue, tell UGO to take a hike and hope to get somthing out of them if they go bankrupt. Any way you slice it, you're doinked. If this is only a hobby to you, take the money and run. If this is your profession or you really need that extra money, talk to an attorney and see what he thinks. This of course assumes that the amount of money owed is actually significant (in the thousands of dollars). Either way, wash your hands of UGO through whatever manner is stipulated in your contract and get on with life.

Re:Go to collection (2)

markmoss (301064) | more than 12 years ago | (#219524)

This does sound like the best approach. If UGO is making offers like this, they are probably pretty close to bankruptcy--and if they aren't, they probably will be once the credit reporting companies find out about that letter. I assume that the arrears are not a huge amount, so you don't expect to collect enough to make having your own lawyer worthwhile, so giving up 25% for a piece of Dun and Bradstreets' lawyer is probably good deal.

Re:Hate to say it (2)

blair1q (305137) | more than 12 years ago | (#219529)

Your lawyer said:
> "one of the most one-sided contracts I've seen in my life."

Your lawyer has never seen an EULA or ISP TOS before, has he?

--Blair
"All your right are innate to us."

Ask Slashdot: Lawyers 'R Us (2)

bare_naked_linux (306356) | more than 12 years ago | (#219530)

Ask slashdot has lately become: IANAL and I do not want to hire a lawyer, tell me what to do.

Now if this had been phrased differently like: Here's what is being done to screw honest web-hosting nerds out of their due money... It might pass as news for nerds.

Now don't get me wrong. I dislike companies pulling this kinda shit just as much as the next guy. But I think this guy should hire a lawyer and slashdot should post news.

--

Bad advice (1)

hafree (307412) | more than 12 years ago | (#219531)

I've had more trouble in the past with banner ad programs than I care to discuss here, but through all of them, I've learned 1 thing: they all reserve the right to bail on you for no reason. Even the biggest and most reputable companies have a clause in their contracts that allow them to terminate your agreement without payment for any reason at any time at their sole discretion. Law suits cost money, and class action suits never seem to give you what you deserve even when you win. I know it sucks, but I would really recommend just cutting your losses and taking the checks before they declare bankruptcy and you get nothing. The only way to make any real money with advertising is to solicit the advertisements yourself and get the money up front. Unfortunately, this means you now need a marketing department...

FTC (1)

jdun (310373) | more than 12 years ago | (#219532)

Try the Federal Trade Commission at http://www.ftc.gov/. They can give you a hand if enough people complain about it. You can do a class action suit. The lawyers tend to be free if the money of the suit is high.

Tip Jar (1)

Big Montana (315852) | more than 12 years ago | (#219534)

One thing you can ask yourself is, "what do I get out of my relationship with UGO?" If it's just money, then you're not getting anything, as they're withholding money you've earned. Bail. These tactics sound like desperation, and are causing you a lot of hassle.

I'm not a webmaster in the "community proprietor" sense, but I've been very interested in how Tip Jars are evolving.

It's my opinion that the smaller, agile, and useful web sites will survive via people throwing them a buck or two every so often. I did this just for the first time the other day, at a little site called MikoDocs [mikodocs.com], and man did it feel good. I found his site through Google and PayPal-ed the guy for saving me time. He sent a thank you response. Very fulfilling, way better than responding to a plea to click on an ad.

If the site you oversee is truly valuable to your users, and has an active community, I don't think you'll have any problems collecting money to cover costs, if that's your goal. Lum the Mad [lumthemad.net] (whose site I can't get to at the moment) did a cool thing in sharing the balance sheet with his usership (expenses vs. donations). Very cool feedback that I think would encourage more people to donate. He even caps his donations when he covers the month's expenses.

I think it's time to smack down these parasitic "ad networks" and kick off the next wave -- Tip Jar Meritocracy (sm).

Sue them. You've got nothing to loose. (1)

anno1602 (320047) | more than 12 years ago | (#219535)

From an egoistic point of view, sue them. It looks as if the law's on your side, so you'll probably succeed. Also, they seem to figure that they have enough money to pay everybody half the check [and still have some left, of course]. So, if you sue them, and enough other webmaster take their bait, you'll get more than half of your money. On the other hand, if everybody sues them, you'll still get at least half the money, since they have it.

Hate to say it. (4)

Chakat (320875) | more than 12 years ago | (#219536)

But you're goint to have to talk to a lawyer, have him put together a strongly worded letter saying that if they don't pay up, you will have no choice but to see them in court. They're in breach of contract here, and if what you say is true, you've got pretty much a slam dunk case here.

why not send them some lawyers? (1)

mveloso (325617) | more than 12 years ago | (#219537)

why not send them a bunch of lawyers in the mail? After all, lawyers are the ultimate gifts that keep on giving; they brighten any relationship, and spread cheer, goodwill, and fair dealing. And they don't take up that valuable rack space that you never have enough of.

"Lawyers - Peace through Strength"
"Lawyers - Don't do Businesss without One"
"Lawyers - Yeah I trust you, but I don't want it up the butt again"
"Lawyers - Mutually Assured Reaming"
"Lawyers - Bring a lawyer to the table, everyone loses."
"Lawyers - what does pyhrric mean again?"

Re:Dear Slashdot, (2)

actiondan (445169) | more than 12 years ago | (#219542)

Seems to me that he doesnt really want to sue anyone:

"A lawsuit just doesnt seem like it would really net any cash"

and wants to get peoples advice about how the situation can be sorted:

"Does anyone have any realistic advice for all these webmasters?"

Lots of webmasters read slashdot so it seems like a fair enough place to ask what others have done in this situation.

I think you're being a bit harsh.

Re:Professional agencies want cash up front.. (1)

cREW oNE (445594) | more than 12 years ago | (#219544)

Wrong suggestion -

Don't run their ads, and you're kicked out in a second. You're obliged to by the contract.

I suggest to sign, take the cash, and try to find somewhere else to get your banners. Except finding that "somewhere else" will be very, very hard.

Re:Hate to say it (5)

cREW oNE (445594) | more than 12 years ago | (#219546)

We've had the ugo contract examined by a lawyer earlier last year. There's very very little chance you can squeeze money out of them. The lawyer classified the contract as "one of the most one-sided contracts I've seen in my life."

UGO is, as the rest of that sector of the net, hit hard by the current crisis. It is not their fault, how much even I hate it. (I have sites under UGO)

There simply is no money to pay the sites their $10K+/month anymore. The party is over. Get over it, get a real job.

It's simple... (1)

Glock27 (446276) | more than 12 years ago | (#219547)

I'd tell 'em "Ugo to hell!!!". ;^)

Build a man a fire, and you keep him warm for a night.
Set a man on fire, and you keep him warm for the rest of his life! - Terry Pratchett

Did you talk it over with them? (1)

PYves (449297) | more than 12 years ago | (#219549)

This definitely seems pretty unfair, but have you talked to the people at UGO about it? It is definitely a bad idea to sign that and lose your rights to money you're entitled to, but it might also be a good idea and ride out the hard times and hope for a better future.

It will do you no good to sue, get the money and then UGO goes out of business if you can take a paycut and possibly see UGO's situation turn around. I can see you saying "Yeah, right, that's going to happen", but maybe having a better idea of UGO's long term business plan would help you make a decision.

Keep in mind I know that pretty much every other company like UGO is out of business (efront, gamefan, etc), but I also don't know UGO's business model so it'd be pretty presumptuous to say they're screwed.

-PYves

Re:Lawsuit? What other options are there? (1)

PYves (449297) | more than 12 years ago | (#219550)

You could refuse to sign the new contract and sue for this year's money owed. Odds are you wouldn't get much for your effort and you'd have to pay lawyers fees. You could sign the contract, take the money from January and February and then tell UGO to take a hike. Or you could not sign the contract, not sue, tell UGO to take a hike and hope to get somthing out of them if they go bankrupt.

You could sign the contract, take a paycut and be grateful you still get revenue for running a webpage as opposed to everyone who lost out in the recent bankruptcies.

You'd probably also be better off asking the people at UGO what their (long term) future is looking like before committing to any new long term contract.

-PYves

Lawsuits (1)

PYves (449297) | more than 12 years ago | (#219551)

This might be seen as a troll... but it needs to be said.

One thing I noticed right away is that almost everyone says "call your lawyer" or "lawsuit" right away, without even looking at the other side of the medal.

Sure, you have a signed agreement that says "UGO will pay me this much", but you know what? UGO can't pay you that much and taking them to court is not going to change that.

Now, if you think that you are getting screwed on this, why not talk to the people at UGO? I'm sure they have people who will be able to explain to you pretty simply why they issued this new contract (although it's pretty obvious they have really small bank accounts by now) and what the plans are for the network as a whole.

When you signed that contract and UGO started hosting your site, you became business partners. When you have a conflict don't take it right to the legal system; talk it out, see what's going on and then decide what you are going to do about it.

UGO isn't your enemy in this case, and it's much more diplomatic to give them a call and talk it over than to have your lawyer do it.

You're in the same boat as UGO, if they get screwed, you're going to get screwed too in the long run.

Lawsuits are not the answer to everything, although I'm sure people who go on Judge Judy would say otherwise.

-PYves

Re:They *HAVE* to do this to stay in business. (1)

PYves (449297) | more than 12 years ago | (#219552)

If they're in such dire straits, what the hell were they doing acquiring Bla-bla? They should have used that cash to pay their affiliates.

You don't necessarily have to dish out actual money when making acquisitions. You can simply trade shares, or in a cse such as this, it is possible that UGO took over any debt bla-bla had incurred.

There probably was a cash transaction as well, but most acquisitions are not cash-based.

-PYves

Re:Lawsuits (1)

PYves (449297) | more than 12 years ago | (#219553)

You don't get my point, I never said to give up, I said that there is a better way to deal with this kind of thing than jumping right to the lawsuits.

They say that they want to pay you, but they want to cut your pay for the future. Taking a pay cut isn't that bad if it means you still get paid. (as opposed to not getting paid at all). Of course it still sucks to be getting less money than before, and if it can be avoided, by all means avoid it, but in any case it will ALWAYS be better than having no income at all.

I like your solution though, but I wouldn't trade cash for UGO shares myself.

Lawsuits don't fix everything!
-PYves

Re:No one-sided contracts (1)

jonnystiles2 (452616) | more than 12 years ago | (#219557)

While the consideration part in the prevous post is correct, more importantly, a pre-existing contractual obligation cannot be waived without exchange of consideration. Furthermore, there may also be problems with duress or "business compulsion." However, this all depends on the original contract and whether or not UGO reserved any rights to unilaterally alter the agreement. I suspect that UGO has some termination or durational clause in the original contract. But if they owe you that money and never indicated that they intended to terminate your contratual rights, they cannot do so retrospectively.

But, this may all be moot since the dollar amounts are low enough that pursuing these claims in court will be too expensive, unless you tried to take them to small claims court. And then you would have a hell of a time establishing jurisdiction over UGO. Which leads us to a solution already proposed by some postings, a class action. While each individual claim is too small to attract the attention of a lawyer operating on contingency fees, in the aggregate, that may be a different story.

So figure out if you can rally typically insular geeks together for a class action if you care enough and dig your heels in if you are prepared to demolish whaterver relationship you have with UGO to collect on the past 2 months. Who knows, maybe you can use the money you get in settlement for capital and construct a similar network with your co0litigants and avoid problems like this in the future. Good luck.

Oh, and by the way, I believe the case Erasmus Darwin is referring to is Hamer v. Sidway, an old case from the 1800's. And the court held for the nephew, sonce forgoing a legal right, in this case the right to somke, drink and gamble, was sufficient consideration to create a binding contract. Don't take legal advice from someone who is not a lawyer, or at least in law shool ;-)

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