Tuesday, December 14, 2010

Did Michael Robertson and the Duane Morris Law Firm Commit Insurance Fraud against Chubb?

Did Duane Morris help Michael Robertson defraud Chubb Insurance
out of $100,000? Read the documents, and YOU be the judge.

NOTE: As with any personal blog, the opinions expressed here are my own. Each reader should come to their own conclusion, based on the factual documents linked to from this blog.

I think everyone would agree that those who defraud insurance companies should be held accountable and criminally liable. When criminals defraud insurance companies, we all pay for it through higher premiums. Each of us should do our part by reporting insurance fraud, anytime we become aware of it.
It is my opinion that Michael Robertson may have possibly committed insurance fraud against the Chubb insurance company, and that Ed Cramp and the law firm he works for, Duane Morris, aided and assisted Robertson in that possible fraud. Only through a criminal investigation and trial would my belief be validated, but in the meantime, I'll present facts and documents and let you, the reader, decide for yourself how ethical the actions of Robertson, Ed Cramp, and the Duane Morris law firm were. Is it fraud? Unethical? Poor judgement? Or just business as usual?
As came out in depositions with Robertson, his company Linspire was paid $100,000 in damages by Chubb Insurance for, what I believe, was quite possibly a fraudulent claim. Presented here are links to the pertinent documents. Read them, then you can decide for yourself if you feel that actions were taken to intentionally defraud the Chubb Insurance company out of $100,000, and that these actions warrant a criminal investigation.
I Believe Michael Robertson, Ed Cramp and Duane Morris Filed a Deceptive Insurance Claim
As many of you know, Michael Robertson has been trying to use the US court system to attack and bully former Linspire employees. Fortunately, the truth continues to come out, Robertson keeps losing in the courts, and the former employees continue to be vindicated, all be it saddled with huge legal bills (a subject I'll discuss in a future blog).
A few weeks back, when I was going through some of the discovery provided by Michael Robertson in his lawsuit against the former employees, I came across one document that made me fall out of my chair. I couldn't believe what I was reading. It was an insurance claim that Ed Cramp (a lawyer with Duane Morris) had filed on behalf of Michael Robertson with the Chubb insurance company. I believe many of the statements in the claim were false and were soundly shown as such in recent court proceedings. (I've attached a signed declaration from Linspire's former IT Director, giving just one of several examples of the false statements I believe Duane Morris alleged in the claim.)
Most shocking, however, was that pertinent information about the situation had been left out of the claim, information that presumably Robertson and Duane Morris would have known about. I can only believe they intentionally left out this critical information to mislead Chubb to get their claim paid. Ed Cramp used the weight of his nationally-known law firm, Duane Morris, to give the claim credibility, so Chubb would likely have assumed that the claim was accurate, truthful and contained all the pertinent information. I'm sure seeing the Duane Morris letterhead on the claim letter gave Chubb a sense of security in believing what was presented in the application. I can't help but wonder if Chubb would be shocked to learn of what was left out, and may very well not have paid Robertson the $100,000 claim, had they been provided with the full story.

What is Insurance Fraud?
Insurance fraud is defined as, "...when someone intentionally deceives another about an insurance matter to receive money or other benefits not rightfully theirs." In other words, when you file a claim with an insurance company, you can't intentionally misrepresent what happened or leave out relevant information in order to intentionally deceive the insurance company so that they are more likely to pay your claim.
For example...suppose you and a friend were at your house, and you both got into a heated argument, and you threw a book at your friend, but instead it hit and broke your TV. Suppose you can't afford to replace the TV, so you decide to file a claim with your insurance company to have it replaced. However, you're not sure if you policy would cover any damage from you throwing a book through your TV, but you are quite confident you are covered for "theft." So, when you file your claim with the insurance company, instead of telling them about the disagreement you had with your friend and tossing the book, you say that a thief broke into your house in the middle of the night and stole the TV. The insurance company, based on your report of "theft," pays you cash to replace the damaged TV. By misrepresenting the facts to the insurance company, you likely have committed insurance fraud.
I believe you'll see from the documents provided below, that this seems to be exactly what Michael Robertson, Ed Cramp and the Duane Morris law firm did.
Robertson's Claim
I've attached a copy of the actual claim letter given to Chubb, signed on Duane Morris letterhead by Ed Cramp. (I've redacted the former employee's names, as Robertson has dragged their names through the mud enough already with his false allegations.)
As you can see, in the insurance claim letter (viewable here), Duane Morris references this as an "Employee Theft Claim," and makes all sorts of claims as to criminal activities such as "theft" and "embezzlement." Duane Morris also references a "Police Report" which Robertson had filed with the San Diego Police Department. The reason I was so shocked when I found the insurance claim, was that the ultimate findings of the San Diego Police Department's investigation were left out of the claim. You see, Linspire had been told the results of the San Diego Police Department's investigation, approximately THREE MONTHS PRIOR to them having filed this claim. Linspire was told at that time that "no crime had been committed and the issues...were civil in nature."
Viewable here is a declaration, signed under penalty of perjury, by Michael McEwen, a Detective with the San Diego Police Department's Financial Crimes Group. It's only two pages long, and I'd encourage everyone to read it. Here is one portion of Detective McEwen's statement:
"Based on my review of the facts of the case, I determined no crime had been committed and the issues discussed in Mr. Robertson's letter and case submission were civil in nature. My conclusion was that the case involved a disagreement between the Chairman and the CEO of the company, which CEO was an officer and agent of the company. This disagreement did not constitute a crime. I relayed my findings on to Mr. Robertson's representative and to Comerica Bank. I specifically told them 'no crime report was taken and no case number issued.'"
So, according to the detective, Linspire knew that the San Diego Police Department had said that no crime had been committed, and had known this for around three months prior to filing their claim, yet they still filed a claim to Chubb alleging criminal "theft" and "embezzlement." I have to doubt that Linspire's policy with Chubb covered, as Detective McEwen put it, "a disagreement between the Chairman and the CEO, " so I believe they probably decided to tell Chubb it was "theft," something for which they would more likely be covered. In my opinion, such misrepresentations could quite possibly constitute criminal insurance fraud and should be investigated further.
Did Duane Morris Participated in Fraud?
Do you think Chubb would have paid out $100,000 to Robertson had they known of the San Diego Police Department's findings? If Duane Morris had included the findings from the police investigation (as I believe they certainly should have), and let Chubb know that Linspire was told "no crime had been committed," would Chubb have paid the claim? Not having a copy of the insurance policy to review, I can't know for sure, but I do believe it's likely that Robertson and Duane Morris may have felt their chances were better if Chubb considered the claim "theft" and a "crime." I think that is likely why they left out the results of the police investigation, so that the insurance company would not find out what the results were so Linspire's claim of "theft" would more likely be covered. Regardless of what the policy would or would not have covered, leaving out such pertinent information is possible grounds for insurance fraud.
How could the law firm of Duane Morris not have known the results of the police investigation were pertinent? They went to great lengths in their claim to list out all the details of their allegations of "theft" to the police department, even attaching a copy of their "police report," and yet they didn't think to let Chubb know the outcome of that investigation three months after those results had been given to Linspire? Does Duane Morris expect us to believe that Ed Cramp didn't know the outcome? Would Ed Cramp be that incompetent to include the "police report," and yet not take a minute to find out what the results to that report were? In his deposition, Robertson was asked, "Who was the person who liaised with the police department about the police report; in other words, communicated with the police department?" For which Robertson replied, "Michael Umansky." At that time, Michael Umansky was another attorney at Duane Morris who, along with Ed Cramp, worked on the Linspire matter. Robertson also testified that Umansky helped create the "police report" document, and yet Ed Cramp didn't bother to find out how it turned out? It just isn't believable to me. I have to believe Ed Cramp, Michael Umanskey and Duane Morris absolutely knew the outcome of the police investigation, and yet, it appears that THEY FAILED TO DISCLOSE THOSE RESULTS to Chubb. That is by definition insurance fraud, in my opinion, and I have to wonder if Chubb would agree.
A pattern of fraud? Did Robertson and Duane Morris also try to defraud Linspire's bank Comerica in a similar fashion?
Another extremely interesting document that came to light in discovery was a letter from Linspire's bank, Comerica, to Duane Morris. In December of 2008, I blogged about how Robertson lost in summary judgement a case against Comerica. (You can read the details of that outcome here.)
As you can see in this letter from Comerica to Duane Morris in January of 2008, Comerica felt that Robertson and Duane Morris had made "false claims" in trying to have Comerica pay for wire transfers to employees for severance. (Keep in mind this letter came to Duane Morris two weeks BEFORE they filed their claim with Chubb.) Robertson and Duane Morris did the exact same thing to Comerica that they did to Chubb Insurance, using their "police report" to imply they were the victim of "theft," and yet failed to tell Comerica the no-crime-was-committed results of that investigation. Comerica had to track down and interview Detective McEwen themselves, since Linspire did not disclose Detective McEwen's findings to Comerica. As you can tell from the stern tone in Comerica's letter, they felt very much deceived, and called into question not only Linspire's credibility, but that of Duane Morris as well:

"Not only does this undermine Linspire's credibility, it also undermines yours. The motivation underlying Linspire's decision to refrain from signing the Fraud Affidavit under oath is so obvious it strains credulity to suggest it is either accurate or legitimate."
The letter points out that Duane Morris knew of the outcome of the police report BEFORE they gave a copy of it to Comerica:
"Detective McCewen advised Comerica that no case number was assigned to the Draft Police Report because--as he said he informed you prior to your delivery of the Statement and the Draft Police Report to Comerica--the District Attorney determined that no crime was committed and that this was a civil dispute between Linspire and the Employees. He pointed to the employment contracts provided by Linspire to the SDPD, which indicate that the respective amounts of the Employee Wires were less than the amounts legally owed by Linspire to the Employees for contractual severance."
Comerica's letter ends in pointing out that defrauding a financial institution is a crime:

"See, 18 USC 1344 (federal crime to knowingly execute or attempt to execute shceme to obtain money of financial institution by means of false or fraudulent pretenses, representations, or promises)."
These are just a few excerpts from the letter. I would encourage everyone to read the entire letter here. You'll see that the Comerica bank shares many of my beliefs about Robertson and his lawyers. It's hard to imagine that after Duane Morris received this stern letter from Comerica, warning them of possible criminal charges for fraud, that Duane Morris would, just two weeks later, make the same allegations to Chubb. This is evidence that Duane Morris likely knew full well what it was choosing to include, and leave out, when they sent their claim to Chubb.
One might wonder why a nationally-known law firm would put itself at risk by seemingly participating in insurance fraud. Consider what happened in 2002 with one of the Big Five accounting firms, Arthur Andersen. After being found guilty of criminal charges relating to the firm's handling of auditing of the failed Enron corporation, Arthur Anderson voluntarily surrendered their licenses to practice as Certified Public Accountants in the US. Firms can become so addicted to collecting hundreds of thousands of dollars of easy client fees, that they just don't have the courage or willpower to stop and drop a questionable client who pressures them to participate in an activity that finally crosses the line.
I've always had a low opinion of Michael Robertson's ethics (see www.freespire.com), and why I feel he needs a strong, ethical law firm to keep him in check. It's very disappointing that such a large, seemingly respectable firm such as Duane Morris would let Robertson pull them down into what I believe are fraudulent activities. Is this the standard Duane Morris holds itself up to? I have to wonder if filing such a claim was something only Ed Cramp was comfortable doing, or is this the culture at all of Duane Morris?

I find it quite ironic that Robertson falsely accuses former employees of criminal activities, and yet he may be the one who attempted the real crimes of bank and insurance fraud. Robertson tried to have former employees arrested and thrown in jail. They have been vindicated of any criminal wrong-doing. I think the facts now show that it's Robertson and Ed Cramp who need to be investigated and perhaps belong in jail and disbarred. Hopefully Chubb will investigate, along with the appropriate government insurance fraud investigation units.
I have forwarded a copy of this blog to Chubb, who claim they prosecute insurance fraud vigorously, stating "We will not pay a fraudulent claim. In fact, we will spare no expense when fighting fraud." I have also filed a police report on this matter with the San Diego Police Department, as well as filed a report with the Department of Insurance for the State of California.
PS: Follow the outcome of any investigation on this matter at Freespire.com.  

Friday, November 12, 2010

Court Orders Michael Robertson to Pay Former Employee $300,000+

Robertson's attacks continue to backfire. Court orders
him to pay over $300,000 to a former Linspire employee.

For those of you following the case of Michael Robertson's insane attacks on former Linspire employees, you will be interested in the latest development from the court today...

One of the former Linspire employees that Robertson attacked was the Controller. This employee (along with several others) was vindicated of all counts in September. Because the Controller had a contract dispute with Robertson, attorney fees are usually awarded, but of course Robertson fought paying. Today, the court awarded the Controller and his lawyer $215,000 in legal fees and $22,958 in prejudgement interest. The Judge also affirmed the jury's damages judgement of $72,500, to be paid by Robertson (Linspire) to the Controller. This means that Robertson will have to pay over $300,000 to just this one employee for his failed attempts in attacking him in the courts. You can read the ruling here. (This is the tentative ruling which was affirmed in court today by Judge Taylor.)

Three of the other employees who were also fully vindicated in the ruling in September, decided not to go after Robertson for their attorney fees, just wanting to move on with their lives. This means Robertson's false allegations and attacks have left them saddled with tens of thousands of dollars in legal bills. All of this makes one wonder why anyone would want to work for Robertson?

I'm glad the Controller decided to go after Robertson for his baseless attacks and that the court system once again worked. As best as I can estimate, between the damages awarded against Robertson and his own legal bills, he will have wasted well over a half million dollars on his vendetta against these employees. (In an upcoming court motion, we may even learn exactly how much money Robertson has wasted on his lawyers.) What a waste of time, money and energy, but then, I've never know Robertson to be sane and rational in his thinking when it comes to his bruised ego. He spends all this money only to shine a spotlight on what kind of person he really is. Brilliant!

Congrats to the Controller and his lawyer, Greg Goonan (who the judge even referred to as "formidable" in his ruling) on seeing that justice continues to be served against the bully Robertson. It's been over three years since the Controller lost his job at Linspire and Robertson denied him his rightful severance. Today, he finally got justice, well, that's assuming Robertson actually PAYS the court-ordered damages. If he doesn't, of course, I'll let you all know.


Friday, September 17, 2010

Jury Vindicates Former Linspire Employees of 3-Years of Attacks by Michael Robertson!

Once again, Michael Robertson's bullying has been put to an end
by the greatest legal system in the world. Yesterday, a jury vindicated
four former Linspire employees who were being wrongly abused and
attacked by Michael Robertson. He knew these employees had
done nothing wrong, but used them as innocent pawns in his attacks.

Many of you who follow my blog do so to keep tabs on the litigious antics and bullying of multi-millionaire Michael Robertson. You also know that I started blogging about Robertson only after he started attacking former Linspire employees who I knew to be honest, good people. I've never had any problem with Robertson disagreeing with me or what I did as CEO for Linspire. It was his attacking these blameless employees that bothered me. Those employees deserved being stood up for as Robertson tried to roll over them.

When asked why he was attacking all these good people, Robertson would say, "Just wait until I get my day in court. You'll see the truth." Well, Robertson not only got his "day" in court, but he got three weeks, and we now do have the truth. Yesterday, after being in the court house for three weeks, the jury returned their verdict. Read on....

Quick Summary of the Case

Three years ago
, I was the CEO for Linspire. Michael Robertson had stepped down two years earlier, and had virtually no involvement in the running of the company since. However, after the Linspire employees brought in a VERY profitable year, Robertson suddenly decided he wanted to be involved. He first asked me to have Linspire transfer $1,000,000 to himself and $500,000 to his father-in-law, the two preferred shareholders. I explained to Robertson that he couldn't just take money out of the company like that, and that there were around 100 other shareholders to consider. If he wanted a distribution, the company would need to offer it to ALL shareholders, not just Robertson. I then came up with a stock-buy-back plan which would have gotten his father-in-law the $500,000 Robertson wanted him to get, BUT in a legal, fair and equitable way, taking ALL shareholders into account.

Robertson rejected my stock-buy-back proposals. I believe he realized that the only way he could get his hands on the majority of the money (without having to share any with the other shareholders), was to run the company into the ground, liquidate it, and then he and his father-in-law, as preferred shareholders, would be first in line to get paid from any liquidation proceeds. (Which is exactly what he did, and in ten short months, millions of dollars from the company magically disappeared and the company was sold. To this day, shareholders have been given no accounting as to what happened.)

Robertson next wanted me to lay off several long-term, dedicated Linspire employees with only two weeks of severance (even though they had just turned in an VERY profitable year). I refused and told Robertson I wanted no part in such a selfish act. I told Robertson that I wouldn't come into work the coming week so that he would have plenty of time to fire me, take the CEO position back, and then fire the employees as he saw fit. Robertson never did fire me or any of the employees, but rather, called me a week later insisting I come back to the office and do his dirty work, fire the employees, give them two weeks of severance, and transfer $1.5 million to him and his father-in-law. Again, I refused, this time telling him I would return to work and execute the layoffs, but that I would give the employees a fair and reasonable severance, not the two weeks he wanted. That is exactly what I did. I returned to the office and laid off the employees, giving them what I believed was the correct severance. As came out in court, as the CEO, I did intentionally navigate the situation to prevent Michael from stepping in and harming these employees (for which the Jury awarded some small damages against me). I stand by my authority as CEO to have taken the actions I did, and I am glad to have protected these good employees. When I laid the CFO off, he even agreed to take less in severance than he was due based on his employment agreement, which more than offset the additional severance I awarded the other employees, in essence, saving the company money AND treating the employees fairly.

Robertson, upset by my actions, absolutely refused to talk or meet with me (even after repeated attempts by me to meet with him to explain all that had happened), but instead, set about attacking me and the laid off employees at every possible turn. He did many despicable things to these employees, including filing a lawsuit, accusing the former employees of fraud, conspiracy, etc. simply because they were laid off and given severance by me, the CEO. The complaint asked for $318,000 in damages from the employees. The six employees involved were two VPs, one Team Lead, the Controller, the CFO, and myself (the CEO). The only one Robertson should have gone after was ME. I am more than happy to accept any judgment against me IF I did in fact do anything wrong, but I will never forgive Robertson for having gone after employees HE KNEW did nothing wrong. Dragging them into this was disgusting and shows exactly what kind of person he is.

The Jury's Verdict

As hoped, the jury completely vindicated the employees he dragged into this. As you'll see, they did find me responsible in a few areas and awarded a small amount of damages.

Here is what the jury found...

VP #1 - Not liable on all counts and gets to keep all of his severance.

VP #2 - Not liable on all counts and gets to keep all of her severance.

Team Lead - Not liable on all counts and gets to keep all of his severance.

Controller - Not liable on all counts AND Robertson was ordered to pay him $72,500 in damages. (The controller had an employment agreement for six months of severance which Robertson had previously refused to honor.)

The only thing that went Robertson's way was that I (CEO) and the CFO were found responsible in a few areas, and Linspire was awarded a small amount of damages from us (equivalent to about four months worth of the CFO's severance), but the damages were far from what Robertson wanted so the jury definitely didn't agree fully with Robertson's side of things. I still believe everything I did was within my authority as CEO, and the CFO did absolutely nothing wrong, as he was simply following my directions (which his employment agreement told him to do). So...

CFO - As I mentioned, he had an employment agreement for two years of severance, but Robertson wanted him to get only two weeks, later moving that up to 2.5 months (in trial he requested the CFO get NO severance). The CFO, however, agreed to accept only 12 months of severance when laid off, saving the company the other 12 months of his severance. The jury ruled that the CFO could keep all of his severance, but awarded damages to Linspire which equated to about 4 months of the CFO's severance. (Even though the CFO essentially ended up with 8 months of severance, well above the 2.5 months Robertson wanted him to receive, we are considering a post trial motion given that he had an employment agreement for two years of severance and was terminated without cause.)

CEO - Like the CFO, I too had an employment agreement giving me two years of severance. However, after laying off the employees, I freely resigned and walked away from my severance, wanting nothing more to do with Robertson. The jury found me responsible for the same items as the CFO and ordered that I be joined in those same minor damages.

The Bottom Line

Needless to say, I was THRILLED with the jury's verdict. Robertson attacked these good employees, out of spite, greed and ego, and wound up with essentially nothing but a big pile of legal bills. I have never cared what judgments came to me--I have always been prepared to live with any of the consequences of my decisions as CEO--but to see the employees vindicated was great. It's been a long three years of Robertson attacking these good people and blemishing their reputations. It was nice to see their names cleared.

So, the bottom line? As per the complaint, Robertson wanted to 1) take away ALL the severance from ALL the employees and be awarded $318,000 AND 2) not be forced to pay the Controller his severance of $72,500. After the jury's verdict, Robertson will end up netting only $8,833, all while having spent, I'm sure, hundreds of thousands in legal bills (ouch!) and quite likely being liable for more, since all the employees who were found not having done anything wrong are of course asking the judge for statutory indemnification and legal fees. It's certainly not fair that these faultless employees should have to pay their legal bills for just defending themselves against Robertson's baseless attacks.

Far more important than the financial victory, however, is these former employees have their good names back! Justice was served!

There were a lot of interesting things to come out of the trail such as why Robertson has never told the shareholders what happened to their investment in Linspire, how he feels about common shareholders who he called "second class" from the witness stand, the many despicable measures Robertson took in attacking these former employees, and much more. I will do a follow-up blog with some of these details, but for now, I just wanted to share this wonderful news and take some time to enjoy this favorable outcome.

This is the third loss Robertson has suffered in the courts relating to the layoffs. He lost against his bank Comerica and also against the gripe site Freespire.com. At least his lawyers are doing very well. =)

Thank you's

Thanks to my co-defendants. We have all grown closer together having had to go through this. You have all been wonderful, and as I said, I couldn't be happier for you with the outcome. (Pool party? =)

I want to thank the AMAZING lawyers Gil Cabrera and Greg Goonan who did such a wonderful job at representing us. More important than the outcome, as defendants, we were all so very proud of the way these fine men conducted themselves. There were actually points in their closing arguments that brought many of us to tears, as they advocated for us and the truth. If you ever need a great lawyer, these two are the best!

I want to personally thank all the jury members who had to spend THREE WEEKS of their lives in the court house dealing with this. America has the best legal system in the world, and at the center of it is our jury system. Thank you from me and all the defendants in this case!

I don't know if it's appropriate, but I have to do it, a BIG thanks to Judge Timothy Taylor. I was SO impressed with how he conducted every minute of this case. There was one part where Robertson's lawyer was hammering away at me, trying to make me look guilty because I couldn't find something in a document, but the Judge DID find it and pointed it out. I don't thank him for that, I thank him because he would have done the same for the other side. He is truly a wonderful example of what a smart, fair, and just judge should be. He WAS the smartest man in the room, as it should be.

Lastly, I want to give a special thanks to the many friends and former employees who showed up at the court house to support us these past few weeks! Seeing you there in support was greatly appreciated by me and the other defendants. It was so touching to have received so many emails, not only wishing us all the best, but actually saying you were "praying for us" and that the truth would come out. Thank you from all of us for those prayers. They were answered.


Thursday, August 26, 2010

Can Michael Robertson Buy Your FREE Speech for $250,000?

Is "free" speech really free? Or can someone like Michael Robertson spend $250,000 to buy yours? He seems to think so. I'm going to put it to the test. Is my free speech really "free?" We'll soon find out...

Michael Robertson thinks he's bigger than the 1st Amendment, you know, that thing that says government can't pass laws to deprive one of their right to free speech. Most countries don't have anything like our 1st Amendment, and it's one of the things that makes America so great. Robertson claims to be a champion of free speech, but when it comes to speech critical of him, he wants government (via the courts) to step in and help him kill it. Robertson has added himself to the long list of those who are trying to whittle away at the 1st Amendment, and usher in an era of political correctness where no one gets their feelings hurt by another's speech. He's the classic example of the bully who loves to dish the criticism out (see his blog, that's pretty much all he does), but can't take it himself.

For those of you not familiar with the Freespire.com case, Michael Robertson has been trying unsuccessfully for nearly TWO YEARS to kill free speech on the Internet at www.freespire.com. Freespire.com is a gripe site, "dedicated to shedding light on the REAL Michael Robertson." You can read the court history here, where you'll see that Robertson has spent an estimated $100,000 to $150,000 and lost at every turn. Fortunately, the 1st Amendment isn't an easy thing to bring down, and without spending a tenth of what Robertson has spent, Freespire.com has continued to win in the courts.

When Robertson lost in the final court case to try and bring down Freespire.com, knowing what an insecure egomaniac Robertson is, I predicted the following:
I won't be at all surprised if Robertson appeals, as he might still have a little money left. (What's that they say about a fool and his money? ;-) But, I'm happy to see Robertson wasting his money (as I'm sure his attorney Ed Cramp is too =), since I won't be the one spending anything, just like before. Doesn't Robertson understand that the more he attacks, the more attention he just brings to Freespire.com? He spends HIS money to bring more attention to the very thing he's trying to shut down. Doi!
Some of us who worked for Robertson have a saying, "Take the smartest, most logical thing to do, and plan on Robertson doing the exact opposite." It's what makes him so predictable. What would be the dumbest thing to do here? To appeal and waste more of your money to bring attention to freespire.com. So, what can we expect from Robertson...you got it. Mark my words.
Robertson is as predictable as a dumb donkey, and sure enough, today I learned that he has appealed this no-win case. He could end up blowing around $250,000 on this loser. (Don't you wish you had that kind of money to waste on your bruised ego?)

Putting Free Speech to the Test

I'm confident enough in our 1st Amendment (and Robertson's incompetence in attacking it), that I'm going to put my free speech to the test. I will not spend one penny on this case. I have already released Gil, my lawyer who had done such a great job on this case up until now. Even though Gil easily won this case on a very small budget, I believe one should be able to defend their free speech for, well, for free. Let's find out if it can be done.

I'm going to represent myself in this case, or with the assistance of any unpaid, "free" volunteers. If I win, then our 1st Amendment is alive and well. Should I lose, then I guess free speech isn't so free after all, and bullies like Robertson can buy yours for around $250,000, and we'll have to start calling it "quarter of a million dollars speech," instead of "free speech."

So, choose your team. Team Robertson or Team Free Speech. Let me know who you'll be cheering for.

Who knew all those years ago when I decided to name the Freespire OS by that name, it would take on a much greater meaning, that of an American's right to FREE speech. Long live FREE Speech, and long live FREEspire.com!


Sunday, June 20, 2010

My Father's Day Tribute Video

This is a tribute video I tossed together for Father's Day using one of the tracks from the new Jayson Haws CD we've been recording here at my place. Hope you enjoy it, and Happy Father's day to all the dads!


Monday, June 14, 2010

Did Michael Robertson Pull One Over on Google?

Did Michael Robertson pull one over on Google?

Last year, I warned Google, eBay, Skype, or any other would-be buyers of Michael Robertson's Gizmo5 (SIPphone) company to make sure and do lots of due diligence before agreeing to any purchase. Having worked closely with Robertson, I wouldn't advise anyone to do business with him. Well, Google went ahead and moved forward and purchased Gizmo5. At the time, I made two predictions:

1) The SIPphone employee shareholders would be left pretty much empty handed, and

2) Google will end up with junk technology and do nothing with the acquisition.

Seems like both of my predictions may have already come true.

In speaking with one SIPphone shareholder, it seems he got next to nothing for his shares. No surprise there. Robertson has a history of taking all the chips off the table for himself.

Last week, TechCrunch reported that Google may have decided to nix a Gizmo-based softphone for Google Voice. The "official" explanation is that Google doesn't build desktop software (well, except for Chrome, Picassa, Google Earth, and a bunch of other apps), so it makes one wonder if Google just decided to pitch the Gizmo client overboard. I wouldn't be a bit surprised, particularly after they realized the spotty tech they likely acquired from Robertson. I'm guessing Google got a real eye opening when they realized the state of their acquisition. I am completley surprised that deal even happened, as Google is usually pretty smart about technical due diligence, but this time they may have had more dollars than sense.

The moral of this story? Don't do business with Michael Robertson, and if you do, don't trust anything he tells you, but if you do...don't say I didn't warn you.


Saturday, April 24, 2010

Michael Robertson Loses. Free Speech Wins. Freespire.com to Live on for 100 Years!

When I left Linspire, I had every intention of just moving on with my life, but soon after my departure, Michael Robertson hit a new and disgusting low (even for him) by trying to have some good people arrested for simply having been laid off and given severance. (What kind of greedy person would do something like that?!?) Robertson tried to have these good people arrested and started attacking them, trying to destroy their good names, and doing everything he could to bring harm to these individuals. Well, I couldn't just stand by and watch. As the saying goes, "All that is necessary for evil to triumph is for good men to do nothing." So, I decided the world needed to know about the REAL Michael Robertson, and little by little, I started to share some facts about Robertson via my blog, and eventually started using Freespire.com to disseminate my writings.

If you review the history page of Michael Robertson's Wikipedia page, you'll see Michael ("Mykill") and his family ("Leslieaudra") remove anything unflattering from Robertson's page (not to mention libeling others with false acquisitions). Therefore, I felt it was important that there was a website to tell the real story about Robertson and where I could defend the employees Robertson was attacking...someplace that he couldn't whitewash and censor. That place became, and is, Freespire.com.

Understandably, given Robertson's unflattering history, he doesn't want the facts shared at Freespire.com to be public, but unlike Wikipedia which he could censor directly, he had no influence at Freespire.com. So, instead, he did what many wealthy, unethical men do, and tried to squash my free speech by filing a lawsuit against me and Freespire.com.

Yesterday, the Judge in the Freespire case came out with her final ruling. Here's what happened...

Trial Prep

My lawyer estimates that Robertson spent over $100,000 on the Freespire case (including a motion for summary judgment which he lost last year). I didn't spend even a small fraction of that. There's a saying among lawyers, "If the law is on your side, argue the law. If the facts are on your side, argue the facts. If neither are on your side, pound on the table." Robertson paid dearly for a lot of table pounding. =) Both the law and the facts were unquestionably on my side. Time and time again the courts have protected sites such as Freespire.com, for to do otherwise would be an infringement on one's freedom of speech (something Robertson pretends to care about, except when it comes to the free speech of others talking ABOUT HIM =). This made defending this case very easy, and very little work was needed or done on our part, but for Robertson, well, let's just say table pounding can be very expensive!

The day before the trial, my lawyer, Gil Cabrera, called me and asked if I wanted to get together before the trial and go over anything and do any prep. I told him, "We won't need any. If we stick with the facts and law, we win, and I know you're a pro at that. Let's let Robertson waste his money and put his lawyers' kids through college. I have better things to do with my money." I then told Gil that I'd meet him at his office a few minutes before the trial, and we'd walk over to the courthouse together. (Gil's office is only a couple of blocks away.) I told him that we'd prepare as we walked over. That's it. That's all the prep we did. I knew this was likely the least a client had ever let Gil prepare for a trial, but I told him he was good enough, and our case strong enough, it wouldn't matter.

The Trial

Gil and I arrived at the courthouse and walked into the courtroom. There was Robertson with THREE lawyers from his high-priced law firm, Duane Morris (Ed Cramp, Ed's partner, and Michelle Hon, an IP litigation specialist). They had posters prepared, documents stacked a mile high, and their game faces on, all poised and ready for battle. (Robertson fancies himself as quite the legal mind, even though he loses a lot more often in the courtroom than wins.) It was clear, Robertson was sparing no expense to try and shut down Freespire.com. I felt sorry for Ed and Michelle who had been handed a total loser case, but I was anxious to see them pound that table...and boy, did they ever! I have to say, Ed and Michelle did a great job, considering they had no case and the law was completely stacked against them. Ed tried to imply all sorts of sinister going-ons as he questioned me on the witness stand about "private" domain registrations, ooooohhhh, using aliases for negotiating domain name purchases, aaaahhhh, and bank wires to escrow companies located in the, shhhhhh, the Cayman Islands. Oh my! :-O

My favorite moment was when Ed Cramp had the entire court room on the edge of their seats. He was going to drop the big bomb on us all, that would blow the case wide open. We spent 30 minutes so Ed's big moment could be allowed in court (he was going to have me read from a confidential document). There were several high school students who were in the court room as part of some class project, so we had to wait for them to all sign confidentiality agreements before they could hear the big bombshell Ed was going to drop on the court. Well, the big moment finally came...we're all on the edge of our seats...I'm on the witness stand and Ed had me turn to a specific page in the ginormous trial documents book they had prepared. He asks me to start reading his big smoking-gun document. The only problem was, what he was reading, and what everyone else in the court is reading, were completely different. It was all I could do to not look at Gil for fear I would bust out laughing while on the witness stand, just three feet from the judge. From the witness stand I had a front row seat watching Michael, Ed and Michelle scratching their heads, scrambling, trying to figure out what had happened. Where was the missing, secret document? After a minute or two of silence, while the entire court waited for them to get it together, I saw Robertson turn beet red, and he started pounding on documents on the table (literally =), as he explained to Ed that someone had photo copied the wrong document! (I could picture how later that day, Ed would have to endure one of Robertson's famous, out-of-control, childish temper tantrum "bell ringings," something I had to witness dozens of times at Linspire. I could also image the big discounts Robertson would be demanding from his legal bill for this snafu. Poor Ed. Or is it "rich" Ed, who actually seems pretty happy to keep taking Robertson's money for no-win cases? ;-)

They finally got things sorted out and Ed was able to read the big zinger. Yawwwnnn. What a let down, just more nonsense. And so the trial went on...and on....AND ON, blah, blah, innuendo after innuendo being made by Robertson's team. A case that should have taken an hour or two, Robertson and Co. dragged on for an entire day, we even stayed past the normal closing time for the court.

The Verdict

After the trial, we had to wait a couple of weeks for the Judge to issue her ruling. When it arrived, as expected, it was a complete and total victory for free speech. Robertson lost. Free speech won. Judge Judith Hayes was spot on in her ruling. She didn't miss a thing, and correctly ruled "...the Defendant had a bona fide noncommercial use for the website, the Court finds the general purpose of the website to be a free speech forum wherein Defendant criticized the management of Plaintiff. ..the Defendant at no time harbored a bad faith intent to profit from a registered mark and that his use of the website undertaken to inform consumers and criticize Plaintiff's management constituted a lawful use of the site."

Oh, but wait! Michael Objects!

I guess Robertson didn't feel like he'd wasted enough cash on this dog case (or maybe Ed Cramp had another kid needing to be put through college), so they filed a TWENTY-SEVEN PAGE objection with the court, contesting the judge's tentative ruling. When we received a copy of their objections (27 pages of the same blah, blah they tried at trial), Gil suggested we really should respond. I told him, again, I had better things to do with my money than waste it on this ridiculous case. I typed up a paragraph, emailed it to him, he translated it into legalese, and that was our response. We then waited for the Judge's final ruling...

Judge's Final Ruling

Yesterday we received Judge Hayes final "Statement of Decision." It reads: "The Court has considered objections by Plaintiff, overrules the objections so noted and hereby issues its Statement of Decision." Translated, this means, "We read your TWENTY SEVEN PAGES of blah, blah, and free speech is still protected in this country. You lose. Free speech wins." (Click here for a copy of the Judge's ruling.)

For all the money Robertson paid the MULTIPLE Duane Morris attorneys, I'll take my ONE lawyer, Gil Cabrera, any day. Even though I didn't pay him to prepare to anywhere near the extent Robertson did his team, Gil easily won. I didn't pay to let Gil have all the resources that Robertson let Duane Morris ring up (motions for summary judgment, prep time, research, nifty white posters, 27-page objections, multiple attorneys at trial, etc.), yet in my opinion, he clearly out lawyered them where it counts--in the courtroom. Gil beat Robertson's team with one hand tied behind his back, while Robertson gave his troops a tank. Gil won by sticking to the heart of the issue (non-commercial free speech site), regardless of all the nonsense Robertson's team threw out there. Sure, Gil DID have the law and the facts on his side, but he still did a great job in delivering them, and it's clear by the outcome that the Judge didn't miss a thing. Kudos to Gil for making sure the real issues didn't get buried in the mud Robertson's side was throwing at the wall.

I won't be at all surprised if Robertson appeals, as he might still have a little money left. (What's that they say about a fool and his money? ;-) But, I'm happy to see Robertson wasting his money (as I'm sure his attorney Ed Cramp is too =), since I won't be the one spending anything, just like before. Doesn't Robertson understand that the more he attacks, the more attention he just brings to Freespire.com? He spends HIS money to bring more attention to the very thing he's trying to shut down. Doi!

Some of us who worked for Robertson have a saying, "Take the smartest, most logical thing to do, and plan on Robertson doing the exact opposite." It's what makes him so predictable. What would be the dumb thing to do here? To appeal and waste more of your money to bring attention to freespire.com. So, what can we expect from Robertson...you got it. Mark my words. Like I say, as predictable as a dumb donkey.

Freespire.com for 100 Years

The Freespire.com domain name was set to expire next month. I just renewed it for another 10 years. I would have registered it for longer, but that's the max they'd let me go. I suppose they figure that in ten years who knows if "web sites" and "domain names" will even exist. One thing I can assure you, however, no matter what the medium will be in the future, I'll make sure the facts about the REAL Michael Robertson get published, not just for the next 10 years, but for the next 100.


Sunday, April 18, 2010

Tips on Which Crops to Grow in We Rule (Game for iPhone/iPod/iPad)

Click on chart to enlarge.

If you play We Rule on your iPhone/iPad/iPod, you may find this tip sheet I put together helpful. It will help you know what are the best crops to plant, depending on your time schedule or even if you're spending Mojo.

For example, the best crops for earning gold per hour are (in order): Wheat, Corn, Rice, Peas, Onions, Strawberries, Pumpkins, Squash, Potatoes, Carrots, Watermelon, and then Beans.

Or, if you have Mojo to spend, and it's XP's you're interested in, then you'll want to go with (in order): Pumpkins, Carrots, Strawberries, Beans, Watermelon, Onions, Potatoes, Squash, Peas, Rice, Wheat, and then Corn.

Simply decide what your goal is, look at your inventory, and choose the crop highest up on the list. You can then see what your yield per hour or per Mojo will be.

I only have included crops for levels 15 and below (as I'm still working my way up to the higher levels myself). When I have all the additional crops for the other levels, I'll update my chart.

Click on the chart to blow it up full screen.

Enjoy, and pass it around to your friends!


PS: Here is a snapshot of my "Kingdom" currently. (Click to enlarge.)

My Kingdom (Click to Enlarge).

Sunday, April 11, 2010

Michael Robertson's $20,000,000 Mistake (Almost)

As most of you know, Michael Robertson is continuing his legal attack on some very good people who once worked at Linspire. As part of this legal assault, I have had to produce emails, documents, etc. in discovery. In going through the old emails I had kept, I found one that I thought I would share here.

One day Robertson and I were arguing about how to treat employees. I think employees are the most important asset of a company. Robertson yells and swears at them, tries to make them feel small, gives them crappy severance, and even ends up suing them. During one of these "how do you treat employee" arguments, I was trying to explain to him that the employees I was defending had just brought in millions of dollars in revenues and profits. He would always come back with, "Yes, and that's their job. That's what they get paid to do." He then went on to brag about how "he" got $20M from Microsoft years earlier by forcing them into a rough situation where they had to pay us to change our name.


See the email I've pasted below which I had sent to Michael Robertson back in 2002. It's an email that I spent a great deal of time and thought on writing before sending it to Robertson. This email, and my subsequent cajoling of Robertson, would end up being worth $20M to Linspire two years after I wrote it.

"Lindows" had just gotten a favorable ruling in one of the very early rounds of the Microsoft v Lindows trademark case (a full two years before we actually settled). I remember that day very well, as we heard of the ruling right in the middle of a developer's conference that we were holding at the Lindows offices. (I'm sure many of the developers who were at that conference will remember it too, as it was a big victory for Lindows against the giant Microsoft.) After the ruling, Robertson told me that his plan was to try and settle with Microsoft and change our name to ChoicePC. He figured he could get between $100,000 to $250,000 from Microsoft on the heels of this loss for them and that they would now agree to settle. As you'll be able to see in my email to him, I thought that was a bad idea. Much of the press Lindows had been getting was coming FROM the lawsuit. Without that, we were just one of a thousand other Linux distors. We needed something to help us build our brand. To me, that was the name Lindows. I also knew we had little downside but HUGE upside to one day settle for a lot more. Knowing that you can't easily change Robertson's mind (you have to stroke his ego and make him think everything is HIS idea so he can later take the credit), I crafted this well-thought-out email. The next day, after MR had read my email, we met and I continued by tactfully cajoling him. Robertson then agreed with me and decided not to change our name. I remember the sense of relief I felt when he changed his mind. Whew! I'm quite confident that without this email and my cajoling, Robertson would have settled with Microsoft at that time. The rest is history. We continued to milk the press from the name and ultimately took $20M from Microsoft to change our name.

Here's the email.
From: Kevin Carmony [mailto:kevin@lindows.com]
Sent: Friday, March 15, 2002 8:13 PM
To: michael@lindows.com
Subject: Lindows.com


First off, congratulations! Not sure if I actually congratulated you on the ruling, so I'll do it now. Not everyone here was as close to the legal proceedings as I was, so they probably don't fully understand how significant your direction in this case was. I was fortunate to have been able to sit in on many of the meetings, calls, e-mails, etc., and to me it was very clear. Many will congratulate our company over this victory, but I sincerely congratulate you personally. Sure, Brobeck has a good team and did some great work (especially Daniel), but I honestly give the bulk of the credit to you. Like you said over dinner, winning doesn't teach you much, but losing does. Lindows.com is the beneficiary of the experience you gained at MP3.com.

As I came back to the office and looked around this place (I was the only one here, everyone was over at the dinner still), and had a minute to think, I have come to the strong opinion that we should keep using the "Lindows" name. I suppose the argument can be made to make the change if MS comes back with a quick settlement, but something tells me they won't, and to be honest, I hope they don't and that we decide to stick with the Lindows name. Let me give you a few reasons why I feel this way...

1. Dvorak said it best, "Lindows has a name that in itself is genius." Two names have put this company squarely on the map: "Michael Robertson" and "Lindows." It was a brilliant move then, and I believe still is, for all the same reasons it was "genius" back then and now even more reasons.

2. Yes, ChoicePC is a very good name as well, BUT it doesn't have the history that "Lindows" now has. I believe the name "Lindows" now stands for much more than when we started (Linux + Windows). It now also stands for not being afraid of taking on MS, it now stands for victory, it now stands for the days of MS always getting there way are numbered. Every army needs a banner, an ensign to rally around..."Lindows" I believe has become that ensign...I'd hate to lose it.

3. Today's victory was felt by so many...you, me, Brobeck...but far more important...our employees, our customers, our Insiders, our supporters, investors, the press, fans, etc. I would feel that if we abandon the name now, in a way we're abandoning them and all the trust they've put in you to fight this fight. What will Dvorak think? What will our Insiders think? What will our employees think? So many people have felt a stake in this fight (you heard the cheers during your toast tonight), I don't want to lose their ardent support. "Lindows" has become the icon of our fight, to bring choice to MS's monopoly. I think it would be a mistake to walk away from that now.

4. I agree we need to focus on making a great product and not fighting legal battles. I believe we've proven we can do this. Our engineering team continues to plow forward, regardless of any legal entanglements. I don't see this a dilution of engineering, but rather a HUGE boost to marketing. I believe we have been handed the best pre-branded name we could possibly have, and it will take much to replace that. Sure, we could work to brand ChoicePC so that everyone comes to know the name...but will the name bring up the same emotions? David V Goliath has served us well in these early days, and I believe there is still steam in that model.

5. We can still introduce the concept of a "ChoicePC" without abandoning Lindows.com or LindowsOS. A "ChoicePC" is one running LindowsOS and shopping at the Lindows.com warehouse. We can gradually brand "choice" while keeping our Lindows banner flying proudly.

6. Lindows has been through the battle and come out victorious (yes, I know this could change, but given such a strong opinion on the PI, I'm feeling confident we will remain victorious.) This battle and victory has injected something into the Lindows name that only another lawsuit could put into ChoicePC. I fear any other lawsuits will be longer fought and perhaps not easily won. We should take this first win and wear it as a badge of honor and courage. As you say, we didn't run when the bully picked on us the first day of school...let's not let MS ever forget that!

7. Finally, I'm exceptionally proud to be associated with this company, and I know all the employees here feel the same way. Lindows is now such a huge part of that pride and our legacy...I don't want to walk away from that. I bet if you took a vote of our employees, 100% would agree. Even if it's not the logical thing to do, it IS the emotional one...and emotions are a powerful thing when trying to get employees to love a company.

You instinctively KNEW that "Lindows" was the right name when we started, just like MP3.com was the right name. My instincts are screaming to me it is even a more brilliant name now.

Just wanted to share my insight as you consider this decision.

Congratulations again! I hope you take some time to cherish the moment...not many can say the took on MS and won.


Just wanted to make sure Robertson doesn't try re-writing history. Robertson likes taking the good ideas from employees (read this for example), but then treats them poorly, like pawns in his little world. Just ask most of those who have had the misfortune of having worked for him (or been sued by him).


Sunday, April 4, 2010

I Love my iPad--Another Game Changer from Apple

Unboxing my new iPad.

During my lifetime, I've been truly blown away more times by Apple than any other company. They've done it to me five times now.

I can still remember the very first time I ran each of these devices from Apple: Apple IIe, iPod/iTunes, iPhone, and the Mac. Each time I was completely blown away, giddy even, with the sizable leap in innovation with each of these products. Well, it happened to be again yesterday, when my iPad was delivered to my home. I spent a good portion of the day using it. And I have to say, I love it. It exceeded my expectations.

Sure, I expected it to be nice, but in a way my expectations were kept in check, given I have owned the iPhone since the day it came out. I guess in a way I was expecting it to be just an iPhone, only bigger. I found it to be so much more. The larger screen allows iPad apps to be much nicer than their iPhone counterpart. They aren't just marginally better and easier to use, but a magnitude better.

With a few taps I was streaming full-length TV shows in beautiful clarity. Photo viewing, web browsing and email have never been so enjoyable. Games are amazing. It's the ideal device to use while watching TV, laying in bed, and certainly to watch movies while traveling.

It's not perfect, no 1st generation product is. Just like with the iPhone, I'm sure it will improve each year. But, this first product is far enough along for me to already know I wouldn't want to not have one. Anyone who waits for the next generation of the iPad will miss out on all the amazing things it can do right now.

For those of you skeptical about "do I really need a device between my iPhone and laptop?" You'll see. You do. And you will be getting an iPad. The iPad will be big. That's my prediction.

Apple has done it again.


PS: As some of you may know, my company has five different apps in the Top 100 of the iPhone app store (social networking). We just submitted our first iPad-optimized app, CLIPish for iPad, and it should be available any day in the app store. Look for it.

Wednesday, March 31, 2010

Michael Robertson Finally Has a Good Idea, Mine.

Robertson FINALLY has a good idea, which he talked about in his most recent Michael's Minute called byo.fm. Oh, wait, that's right, this wasn't Robertson's idea, it was MY idea from years ago when I pitched it to him at MP3.com, called My Way Radio. I've posted below one of the mocks I made when I made my pitch to Robertson. In fact, you can find the Power Point overview I put together for My Way Radio back then here. You won't see anything on byo.fm that wasn't discussed in my overview. Glad to see the light finally came on for him.

Robertson likes to bill himself as a forward-thinking visionary. It would appear he's more a backward-thinking idea taker. Robertson, just remember as you're building out your new venture, you're helping prove MY idea was a good one. Thanks Michael! I wish you much success with my idea, it IS a good one! =)

The mock I made for MyWayRadio.com from nearly ten years ago.


Wednesday, March 17, 2010

My Third Annual American Idol Predictions - Season 9 - 2010

As some of you know, each year I make my predictions for who I think will win American Idol and in what order I think the contestants will be voted off. (Here were my predictions for 2009 and for 2008.) I set my predictions after the first performance night of the Top 12 (which was last night).

Here are my predictions for this year. As always, I'm not saying these are my PERSONAL favorites, but just how I think America will end up voting. (Siobhan, Lee and Didi are my personal favs.)

My predictions are:

CLICK TO ENLARGE - #1 is my predicted winner,
and #12 my prediction as first to be voted off.

Also, as with previous years, email me with YOU predictions or post them as a comment to this thread, and we'll use the same point system used in previous years to see who is winning at the end of each week and how we all did by the end of the season. (Don't worry if you miss sending me your predictions before they start voting people off tonight, as the point system takes into account when you jumped in with your predictions with a slight penalty for jumping in late.)

To make it easy to email or post your predictions, here are the contestant's names in text form, so you can easily cut, paste and move them around in the order you predict.

Aaron Kelly
Andrew Garcia
Casey James
Crystal Bowersox
Didi Benami
Lacey Brown
Lee Dewyze
Katie Stevens
Michael Lynche
Paige Miles
Siobhan Magnus
Tim Urban


SCORING POINT SYSTEM: Every week, you get 1 point for every number off you were for where someone would be voted off. For example, if you predict Casey will make it to #2, but he gets voted off #4, then you get 2 points. If you guess it smack on, you get no points. Like Golf, the LOWEST SCORE WINS.

PENALTY POINTS FOR LATE ENTRANTS: If your prediction doesn't come in before the first round (when there were 12 contestants), you are penalized 1 point. If you miss the first two rounds, you are penalized 3 points. If you miss the first three rounds, you are penalized 6 points. No more entries after the first three rounds and we are down to 9 contestants.

Tuesday, March 16, 2010

Nearly Two Years and Michael Robertson Remains Silent to Linspire Shareholders

Michael Robertson still not talking to shareholders.

It's been nearly two years since Michael Robertson sold Linspire to Xandros without any shareholder input. To this day, Robertson has never held a shareholder meeting or sent any communication to the one hundred or so Linspire shareholders with the details about that transaction.

It took a shareholder lawsuit (which Robertson unsuccessfully tried to thwart) for Robertson to finally come up with any information. After a year and a half, that case was finally settled. Here is what was disclosed from that settlement:
Kevin La Rue 7:36am March 11th, 2010

Dear Fellow Stockholder of Digital Cornerstone (formerly known as Linspire, Inc.),

As you may know, in October 2008, I initiated a lawsuit as a shareholder of Linspire relating to actions taken by Michael Robertson and Larry Kettler in operating Linspire and their mismanagement of the company. I have settled this matter, receiving no money from Linspire personally, but required that a condition of settlement be that I be allowed to disclose to the other shareholders the information I learned during the litigation about what happened to the company’s assets.

Specifically, under the terms of the settlement agreement, I have been authorized to disclose to the shareholders of Linspire how Linspire’s funds were used by category, how much cash Linspire had at the time its assets were sold to Xandros, and a specific accounting of distributions to Linspire’s shareholders or shareholder related entities. It is important to note that the settlement specifically states that this disclosure I am making is not made on behalf of Linspire, Michael Robertson or Larry Kettler.

Based on the information I received during the course of the litigation, below is the disclosure I have been authorized and am able to make to each of you:

As of July 31, 2007, Linspire had $3,802,531.20 of cash on hand. As of June 30, 2008, when Linspire sold substantially all of its non-cash assets to Xandros, Inc., Linspire had $1,077,952.58.

Between June 2007 and June 2008, Linspire expended: $286,329.96 on its data center.

Between July 2007 and July 2008, Linspire expended: $1,629,907.06 in payroll expenses.

Between June 2007 and June 2008, Linspire paid Ajax13, a company related to Michael Robertson, $180,000.00 for a licensing fee for certain software Linspire was allegedly using.

In September 2008, Linspire transferred $600,000.00 to “SKL Trust, Michael Robertson” for “MP3Tunes Pmt.”

Finally, Xandros acquired Linspire for 4,098,360 shares of Xandros (a privately held company). I was unable to verify the valuation of those shares or to obtain who or what entity currently owns these Xandros shares.

I have tried to send this information to all the shareholders of whom I am aware and for which I have a method to contact them (via email addresses or social media services). To the extent you know any other Linspire shareholders, please feel free to forward this to them for their information.


Carl Kevin La Rue

It would appear this is the best the Linspire shareholders can hope for. No shareholder meeting. No detailed explanation. In fact, you'll notice one of the terms of the settlement was that the disclosure was NOT made "on behalf of Robertson," who is clearly doing everything possible to avoid any accounting to Shareholders.

I'm sure the Linspire common shareholders would still like to know:

What was the valuation of the Xandros stock? Who holds that stock now? (Presumably Robertson took this as the preferred shareholder.)

What in the world did Linspire need from Ajax13 to warrant a $180K payment to this Robertson-owned company? As the former CEO for Linspire, I can't think of a single thing that Ajax13 had which Linspire needed, but I can certainly see Ajax13 needing Linspire's cash.

It appears that Robertson forced Linspire into liquidation so he could take the $600K (and presumably all the Xandros stock), and yet has kept the company going to attack former employees. The 100 some-odd shareholders still hold stock in Digital Corner Stone, Inc., and that company has lawsuits going on, attacking former employees and trying to shut down Freespire.com. I still own shares of that business. I don't want to see them attacking good people. To this day, Robertson is using Digital Cornerstone to attack Theresa, Cliff, Randy, and others, forcing them to each spend thousands in legal bills defending their good names.

I have no problem with Robertson as a preferred shareholder getting what is rightfully his due. What I DO have a problem with is 1) him doing everything he did without sharing any information to shareholders for years, and 2) him transferring the assets out of the company as some "liquidation," and then keeping the company going so that Robertson can attack good, honest people.

Michael acts as if because he put up millions, he's the only one who deserves to be treated with any fairness or respect in the Linspire failure. He gives no credit to the 100 or so shareholders who wrote checks to buy shares in the company and exercise stock options, or the employees who worked countless, dedicated hours. When I left there, the team of employees left the company profitable with millions in the bank. How are they rewarded? With legal attacks. The $600K Robertson took was only made possible because of the work those employees did. You could take all the salaries from all the employees he is attacking, for the entire time they worked at Linspire, and it would not equal the revenue these employees brought in to Linspire in their last year there alone. Way to "take care of the peeps" Robertson.

Not long ago, I emailed Michael and offered to take down Freespire.com and even purge all my blogs about him if he would back off his legal attacks against these good people. Robertson declined my offer and to this day continues his attacks.

Even if what he did was technically proper, the way he has treated shareholders and employees is unethical and wrong. That's what I have a problem with.


Tuesday, February 16, 2010

Will Freedom of Speech be Banned in America? Michael Robertson hopes so!

Will freedom of speech be banned in America? If Michael Robertson has his way it will be. He wants Freespire.com taken down because the site is critical of him and exposes many of his questionable business practices. Robertson is trying to use trademark law to shut down Freespire.com. Fortunately, America has a rich history of supporting freedom of speech on the Internet. Robertson already lost in summary judgment in the case, and it goes to full trial later this month. (If you're in the San Diego area and would like to attend the hearing, email me for details.)

For Robertson to shut Freespire.com down, he needs to prove I had bad faith intent to "profit" from the site, such as by confusing visitors. For example, show that people visiting Freespire.com would somehow be so daft that they would be confused and think the site was run by Xandros (the trademark holder for the term "Freespire") and that this confusion was created so that I would profit from the site.

If you visit http://freespire.com, you'll see first hand how ridiculous that argument is. There's clearly no confusion that this site is from Xandros (or Linspire), nor has there ever been any such confusion, and the site has never received one dime of revenue or profited. (Robertson's lawyers know the case is a dog, but they love taking Robertson's money and he's crazy enough to pay it. Doi!)

Xandros, the trademark holder, has never expressed to me any problem with the Freespire.com site or asked me to turn the domain name over to them. It's Robertson (who does NOT have the trademark) who is spending tens of thousands trying to take Freespire.com down and silence his detractors. Does anyone really think Robertson is looking out for Xandros? Robertson doesn't even look out for his OWN employees and shareholders, why would he care about Xandros? He clearly only cares about one thing--twisting trademark law to kill freedom of speech that is critical of him.

Robertson loves to whine about others who don't respect freedom of markets, speech, etc., and yet he's the one wasting loads of cash trying to do that very thing.

Long live freedom of speech. Hopefully the court will defend it later this month. I have every confidence they will. I'll be back to report when it does.