Wall Street Really Needs Relief [Gothamist]

We love it. It's like the Worst Company In America Contest, but for real.

September Madness [TechCrunch](Thanks, Fuzz!)

Dow Jones reports that those of you waiting to hear more about those option-ARM, "pick-a-payment" or "pay-option" loans are going to be happy:

Wachovia, like WaMu, has a troubled mortgage portfolio and faces its own uncertain future. Saddled with a mountain of troubled adjustable-rate mortgages inherited through its 2006 takeover of Golden West Financial Corp., Wachovia has seen its financial condition weaken and its stock price plunge. Former Chairman and Chief Executive G. Kennedy Thompson was ousted earlier this year.

Both WaMu and Wachovia have taken big lumps from writing a mountain of so-called option-ARM loans, or adjustable-rate mortgages that allow some homeowners to actually increase their loans' balance by paying less than the full monthly interest they owe.

Option-ARM loans have quickly become notorious for showing high rates of delinquencies and foreclosures. Many option-ARM borrowers have increased their loan balances even as the value of their homes fell, leading many to stop making payments or walk away from properties altogether as their homes were worth less than what they owed on the mortgages.

Wachovia recently held more than $120 billion in such loans, a central driver that has led the firm to raise capital and slash its dividend.

Not too long ago the CEO of JPMorgan Chase had this to say about the coming wave of Option-ARM loans: "The first wave of Americans to default on their home mortgages appears to be cresting, but a second, far larger one is quickly building." He added that the losses on these mortgages, which were given to people with good or excellent credit, will be “terrible.”

Wachovia shares sink, down 45% for week [Chicago Tribune]
(Photo: epicharmus )

Each spot features precocious little urchins discussing topics like "risk management" (ha!) and their parent's perceived personal finance failures until eventually the name of AIG is invoked as a salve to soothe their worried minds. Each commercial ends with AIG's tagline "The strength to be there." We saw these running as recently as Sunday, two days before you, the taxpayer, bailed the company out with 85 billion of your dollars.

Enjoy.

Fed to Loan A.I.G. $85 Billion in Rescue [NYT] (Photo: Getty)

JetBlue to Start Charging for Pillows [NYT] (Photo: Lil Erna)

...6098 to 4826, a solid trouncing of Comcast, which had been favored to win by many commenters. After 67 rounds and five months of fierce battling, Countrywide climbed to the top of the poop pile and affirmed its well-deserved status as the absolute nadir of capitalism. It looks like in the end, we all decided that the destruction of a giant chunk of the American economy by greed and fraud was more reprehensible than an unsatisfactory internet experience.

The Lucky Golden Shit award will get shipped to Angelo "Golden Boy" Mozilo, former Countrywide CEO, who steered the ship of financial doom from its inception to the height of its unfettered raping of the American Dream, just as soon as we find a good mailing address for him. The receipt for the Lucky Golden Ship will get mailed to Bank of America CEO Kenneth D. Lewis, along with a certificate of completion.

Congratulations to our top 10 runners up

Comcast
Walmart
Bank of America
American Airlines
Capital One
Diebold
Exxon
United Health Care
Blue Cross Blue Shield
Microsoft

You're champions, all of you. Better luck next year.

[via CNET]

RELATED: Who would wait a week in line for an iPhone 3G? [Fortune]

New York Magazine pulled from their files the subscription card that authorized the subscription to New York Magazine (shown at the top of the post). The postcard was received on 11/19/2007. The card was sent to Keith's house by first-class, meaning it should have gone directly to them.

Tova Abrahmov, New York magazine's Retention Director, wrote via email, "Once the order was placed on the file, we then mail out seven invoices over a seven-month period asking for payment before threatening any collection agency action."

Keith says he got the invoices. What is unclear to me," he wrote, "is why I had a responsibility to respond to them at all. If neither of us initiated the "free trial", there can be no foundation for a claim that we are responsible for canceling a non-request for your magazine."

"I can not say with 100% certainty that she is the person who dropped that postcard in the mailbox," said Abrahmov, "...[w]e cannot guarantee that your wife is the one who "authorized" this order or mailed the order back to us (versus someone else in your household or even a neighbor, for argument's sake)..."

Keith wrote, "The proof that NY Mag sent was a blank postcard with two options (neither of which was checked) and no name or address on the card. Is this a joke?"

New York Mag was highly apologetic and canceled the subscription and waived all charges.

Then, two weeks after the parties finished corresponding, Keith and Stacy received another message in the mail from New York Mag. It was a letter thanking them for renewing their subscription.
After being notified of the error, New York Magazine's Retention Director expressed her deep sorrow, writing, "In requesting a copy of the original piece of mail through our fulfillment company, a clerical error led to it being processed again and treated as a new order. Needless to say, this order is being removed immediately."

PREVIOUSLY: UPDATED: NYMag: Collections Threatened For Sub You Think You Never Ordered

Has anyone else ever gotten a debt collection notice for a magazine they never ordered or received?

In response to this post, New York Mag's Communications Manager, Lauren Starke, said, "[T]he invoice in question was for a valid renewal order made for the magazine (which has since been cancelled through customer service and the subscriber won’t receive further invoices). I know it’s easy to lose track of everything one orders...Based on the name and zip code our circulation department was able to locate this customer's account. In this case, the specific code on the account was from a renewal offer that was mailed to her and mailed back to us."

We asked Keith for a followup response to see if there was any way his wife had somehow forgotten that she sent in a renewal, or if they even had ordered NYMag in the past at all. He says, "My wife says that when she signed up for a website www.vault.com, she started to received New York Magazine. They never charged her for it (and we barely glanced at it). When I called them (NY Mag) yesterday (shortly before I e-mailed you) the representative said (in no uncertain terms) that the subscription was made through an affiliate (no doubt, vault.com). To be clear, she has never, ever, not even once ordered or paid for a New York Magazine (subscription or otherwise)."

Here is the live audio and powerpoint from a recent presentation I gave called, "The 5 Things Your Customers Aren't Telling You." This is number 3, "Stop Hiding Behind Walls Of Robots." It's all about how companies think they're saving money by replacing humans with machines but sometimes machines can't do jobs as well as humans, especially when it comes to customer service. I brought the point to life with a funny little story about eBay and their wonderfully inept automated email response system. I hope you enjoy the video, including the intro and outro ditties I worked up on my girlfriend's old Yamaha synth.

(Photo: Tubes.)

Glass-Steagall was passed under the Roosevelt administration in 1933 in direct response to the Wall Street shenanigans that ushered in the Great Depression where banks shoved their own depositors into buying the stocks the banks were dealing. The basic idea was to keep banks from speculating with the savings that American citizens were entrusting within their vaults.

Its repeal, under the Gramm-Leach-Bliley Act, drafted and passed by a Republican congress, and signed by Billiam Jefferson Clinton, allowed commercial banks to merge with investment banks. For instance, Citigroup merged with Traveler's Insurance (although this merger was announced in 1998, before the act was passed, at the time Citigroup CEO Sanford I. Weill said that he spoke with the Feds and, "that over that time the legislation will change...we have had enough discussions to believe this will not be a problem.").

Now, on the one side they could sell mortgages to homeowners, and then invent fancy investment structures which they sold on Wall Street. Because they were "covered" on both ends, banks felt free to sell increasingly dicey mortgages, just so long as another sucker was picking up the garbage. This sucker was picking it up because he had a plan to repackage it and sell it to another sucker, and so on. Eventually we end up with no-doc stated income interest-only option-ARM no money down mortgages being repackaged as "sound investments" being sold as "stable assets" for city pension plans to park their money in. (See "Subprime Meltdown As Told By Stick Figures").

We can only imagine the level of machination exerted over those 30 years, but we do know this. Robert Rubin was Secretary of Treasury, which had oversight over Glass-Steagall regulation. Days before he resigned, Glass-Steagall was repealed. Just over a year later, he became chairman of the Citi executive committee, with an annual compensation of $40 million, a position he still holds, despite Citigroup's $24 billion in subprime-related losses.

(Photo: Joy Of The Mundane)

(Photo: Ben Popken)

1. To be an influential and successful youth culture brand strategist, you're going to need to be a White male, preferably with an affluent upbringing, but with a penchant for rap music and 80's punk. Don't have that particular penchant? Wikipedia that shit!

So You Wanna Be A Brand Strategist? [Don't Believe The Hypebeast]
(Photo: TheeErin)

You know Merrill and Morgan and Lehman and Citi
J.P. and Wamu and Bofa and Barclay's
But do you recall?
The most famous i-bank of all?

thumpety thump thump
thumpety thump thump
Give up your dirty dough

"Frosty the Goldman" and Other Odes to Subprime Profiteers [Village Voice] (Thanks to James!)

The boiler's been replaced and I've had consistent heat and hot water since xmas. Now i just have this unholy clanking coming from the steam pipe every morning b/t 3 and 5 am which jolts me from my bed in fear that its about to explode and take me with it. The super says hopefully it will get resolved this week.

And despite the fact that I'm fairly certain that, for my troublemaking, Dermot will either price me out of my apartment or fail to renew my lease come august, I can take some solace in the fact that the elderly people in my building now treat me like a local hero for getting Dermot to cave in a way they had never been able to.

Dec 13th
On Monday, I returned home from work to discover an unexpected message from the city building inspector tucked under my door, stating that he had come to check on my heat and hot water, but that, since I wasn't home, he'd check things out in a neighboring apartment.

I had no idea what would come of this notice, but then two days later (this evening to be precise), another notice appeared under my door announcing that Dermot will be replacing our now infamously busted boiler next Monday...

Mind you, our building manager told us at our tenant meeting last month that it would take weeks of work to replace the boiler, and that the entire time we'd have to have a noisy generator blaring outside, keeping us up nights. Interesting how those horrid weeks she described have now been reduced to a few short hours.

Like I said, the visit from the inspector was unexpected. I never did get around to filing any complaints with 311 (my lack of faith in government leads me to suspect they'd collect dust in a database somewhere).

Thus, I believe Consumerist is entirely responsible for these matters coming towards their resolution — responsible, in fact, for both the city and Dermot taking notice in the first place — and I am extremely grateful for your support on this issue.

Consumerist is truly the harbinger of corporate responsibility.

Thank you and happy holidays.

Dec 17

FYI, workmen are still here and the heat's off ... it's 61 degrees in my apartment right now

Dec 20th
Boiler was supposed to be replaced Monday; it's Thursday night @ 10pm, they're still here making a racket and I've got ice cold water coming from the tap.

Dec 21
As of this morning, still no heat, no hot water. It's 61 degrees in my apartment.

PREVIOUSLY:
Coldest Day Of Year. No Heat On. Thanks, Slumlord Dermot Company.
Stuck With Dermot Management, A Modern-Day Slumlord
More like Dermot Mismanagement [Orthodox Anarchist]

Trendwatching says it's part of the consumer trend of "premiumization," whereby every product is available in "upgraded" form. Think premium vodkas, where you pay $10 more just to have a fancy backstory in a pretty bottle, and apply that mentality to every consumer good.

Renova... now you can talk out of your ass and wipe it at the same time!

WHO: Lowe's
WHAT: Calling Christmas Trees "Family Trees"
WHERE: Lowe's Apologizes for 'Family Trees' in Christmas Catalog [CNSNNEWS]
THE QUOTE: "We take this situation very seriously and are redoubling our efforts to proofread those catalogs in the future."

WHO: Breyer's
WHAT: Changing ice cream formula by adding Tara gum.
WHERE: Breyer's Ice Cream Has Tara Gum [Consumerist]
THE QUOTE: "In response to your questions regarding the use of tara gum in its ice cream, Breyers is proud of its all-natural heritage. It's a position we take very seriously and one we work hard to maintain...By adding a natural gum to Breyers All Natural Vanilla ice cream, we've helped to protect the product's texture while staying true to our all-natural commitment."

WHO: Healthcare Distribution Management Association
WHAT: Counterfeit drugs being sold in pharmacies.
WHERE: Fake drugs show up in U.S. pharmacies [USA TODAY]
THE QUOTE: "We take it very seriously."

WHO: CPSC
WHAT: Cribs that kill babies.
WHERE: Baby Cribs Recalled After Three Deaths [AP]
THE QUOTE: "When we learn of a crib-related death, we take it very seriously."

WHO: Bell Mobility
WHAT: A "Pimp" ringtone referencing "ho's" and featuring the sound of women getting slapped.
WHERE: Bell Mobility hangs up voice of terror ringtone [National Post]
THE QUOTE: After women's shelters complained, Bell said, "We learned from the Pimp Tones incident and Bell does take these concerns very seriously."
BONUS: Later in the year, there were complaints about a different "Pimp Tone," this one had a woman screaming, "Don't touch me! Get back! No! No-o-o!" Bell said, "Obviously, the opinion of our customers and the public is very important to us and we take it very seriously."

WHO: Boston
WHAT: Hand-made LED signs featuring characters from the "Aqua Teen Hunger Force" cartoon.
WHERE: Boston drops charges against Mooninite terror cell leaders [BoingBoing]
THE QUOTE: "I hope the message goes out to all guerrilla marketers who plan on doing business in Boston that we take the public safety of those who live and work here very seriously."

WHO: ConEd
WHAT: Revelation that they outsource their manhole smelting to nearly naked Indians paid dollars a day.
WHERE: New York Manhole Covers, Forged Barefoot in India [NYT]
THE QUOTE: "We were disturbed by the photos. We take worker safety very seriously."

WHO: United Fresh Fruit and Vegetable Association
WHAT: E.coli in bagged lettuce
WHERE: Unseen danger in bagged salads [MSNBC]
THE QUOTE:
Q: The Food and Drug Administration and the California authorities say that the E.coli outbreaks came from bag lettuce. You disagree?
A: Well, it's certainly their firm belief and we take it seriously.

(Photos: sonyaseattle, DCvision2006, J. Adam Huggins. "Public Relations" image by Ben Popken)
Additional reporting by Alex Chasick and Meghann Marco.

After cleaning black mold off the ceiling daily with bleach for about two months and pleading with the new landlord, he sent the pseudo-super, who barely speaks English, to fix the leak in my bathroom.

After ripping down the almost collapsed ceiling and the neighbor's kitchen floor, the guy discovered at least three different leaks, all converging on my ceiling.

This is a clip of him working on the problem (day 2) from the neighbor's apartment upstairs. He states the case rather simply, "Mucho problemo!"Bucky says the super replaced his ceiling with a drop ceiling for easy access, and now there's some new drips. Perhaps a sequel could be in the (water)works?

Have you ever had trouble getting your landlord to do repairs? Do you have any tactics that have proved successful in encouraging the landlord to get the job done?

At the end of October, Daniel wrote us about the troubles he, and all the other tenants, were having with their building's shady management company, Dermot Company. After his story posted here, Dermot called him, "jumping through hoops to kiss my ass," as Daniel put it. He asked us to refrain from posting the news to make sure that they weren't just making kissy kissy nice nice to put out the bad PR. We agreed, and Daniel's instincts proved correct.

His update, inside...

Oct 30

One of the guys in their maintenance department just called up to schedule an exterminator appointment, said he'd check out the hot water issue, and was pleased to learn that after two weeks, my super finally came over last night and installed a smoke detector. He also gave me his personal telephone extension so that I wouldn't have to deal with their maintenance line. He said he'd call me back later today to let me know when the exterminator is available.

-Daniel

-Ben

Dec 3

Welp, shortly after the post on Consumerist was mentioned on Gawker, I got a call from someone in Dermot's maintenance dept. who promised me he'd get all of these issues resolved as quickly as possible. (Gee, it only took embarrassing the company on the biggest blog in NYC to get their attention. How responsive!) He also gave me a direct number to reach him at so that I wouldn't get caught in voicemail hell next time I have an issue needing attention. Thus far they have sent an exterminator, so my roach situation has improved. And they also had the super install a smoke detector.

However, the hot water is still on-and-off, and, as I discovered at a tenant meeting two weeks ago, the boiler is broken and needs to be repaired or replaced. Dermot is leaning towards replacement, meaning that I, and the other tenants, will be subject to paying for an MCI. i.e., I just moved into the building a month and a half ago, and now I need to shell out X amount of dollars to pay for the broken boiler. In the meantime, if there's no hot water, I have to call the super to have him switch the boiler back on, because it keeps blowing out every 30 minutes. You can imagine how great I feel about having to call the guy first thing in the morning to tell him to roll out of bed and hit a switch so that I can take a shower.

Also, yesterday was the coldest day of the year so far, and there was no heat til nightfall. It was snowing, but my radiator didn't come on til 6pm. Not heat in the morning. On a Sunday. I was freezing all day.

In addition, I also learned a few other things at the tenant meeting: No one in my building has ever reached anyone on the maintenance number, and they say that they've reporting the same issues to Dermot repeatedly since they took over the building, and that they have yet to be resolved.

Dermot sent a building manager to the meeting who sought to make every excuse for the lack of traction on any and all maintenance issues, saying that she has no idea why no one's answering the maintenance line. After I tore her a new asshole, refusing to roll over for her corporate doublespeak, half the tenants came up to me and thanked me for standing up for everyone.

We were then told that we should take all our problems to the super, and not contact Dermot directly, even though during tenant orientation they tell us to leave the super alone and to take everything directly to the maintenance dept. We were also told that contacting the building manager directly was a very effective form of action, yet she refused to post her telephone number.

Another exciting tidbit: The previous super and her sons, who were fired when Dermot took over the building, have been sneaking back into the building and sabotaging utilities. The building manager told us to be on the lookout and not to let them into the building. I asked how I'm supposed to know what they look like considering that I just moved in. She said she wasn't legally allowed to distribute their photos. Get that? Disgruntled ex-employees are attacking the electricity and gas in my building, but I'm not allowed to be shown who they are! Boy, that makes me feel safe.

There are also some questionable things happening with my lease — namely, it appears that Dermot misled me about the legal status of my apartment, telling me that it was rent stabilized when it actually is not — at least, according to my City Council rep. I'm currently investigating the matter with my attorney.

The Dermot disaster continues...

-Daniel

(Photo: Getty)

I lost my 30 day unlimited MetroCard over the holiday weekend. Happily, a friend told me the MTA will replace it if it was purchased with a credit or debit card, which it was. However, since calling the handy replacement number on the MTA's web site for THREE DAYS IN A ROW and holding anywhere from 100-150 minutes each time, I'm not so sure. Have other people in New York dealt with this? I understand the MTA is probably like your average DMV when it comes to efficiency, but this is just plain ridiculous. My lunch money is dwindling with each $2.00 trip to—and from—work.

That's one to cut the cost of replacing metrocards - never pick up the phone. Our best suggestion is that she outsource this job to India. It's not just for Fortune 500 companies, you can use a company like Brickwork and pay someone $4/hr to sit on hold for you. For a $76 unlimited use subway card, it could be worth it. We'll let you decide, however, whether listening to the MTA hold music is more or less cruel than paying them cents an hour to pour manhole covers.

(Photo: Ben Popken)

A major NYC real estate corp [Dermot Management] is seriously fucking its tenants, myself included, and I just signed my lease a week ago and am now stuck with these bastards.

I just moved into an apartment at 121 Seaman Ave., in the Inwood neighborhood of Manhattan.

The property is managed by the Dermot Company, which has been snatching up properties all around New York City and providing broker free rentals through sites like Rent-Direct.com, which is where I found my apartment.

The apartment seemed like a steal: A lot of space, a pretty nice building, a decent neighborhood (if far as hell from all civilization) and a reasonable rent. However, upon moving in to my new apartment, I made a few alarming discoveries: My kitchen is infested with cockroaches, I have only intermittent hot water, and there are no smoke detectors in my apartment.

Though, at my lease signing, Dermot assured me that they would be prompt in responding to any maintenance issues, I have found that they keep their maintenance line locked in "Do Not Disturb" mode 24/7 and do not return calls under any circumstances. It has been over a week since I have called to complain about these issues — all three of which are clear violations of NYC housing code — and I have yet to receive a call back.

Last night, I asked a neighbor about her experience with Dermot. She told me that the tenants in my building — those who have had the will to stay and fight — have been organizing against Dermot and that they've already called in the City Council for help. She says that she has personally filed a half-dozen complaints with 311 in the past year, that the hot water has been an issue for a long time, and that when she withheld rent, as was within her rights, Dermot wrecked her credit. She said that half the tenants have vacated in the last year, three on my floor alone, and that she's moving out before her lease is up because she doesn't want to deal with Dermot anymore.

A NY1 article published earlier this month (that I wish I'd read before signing my lease) says:

Tenants [of another property in Brooklyn] say they're being forced out of their rent controlled and rent-stabilized homes by new landlords who are transforming them into luxury apartments. They claim they're being harassed with all sorts of tactics, from frivolous lawsuits to challenges to their leases, to being denied basic repairs...

...Jackson's been living in a rent-stabilized apartment at 99 Lafayette for 16 years. She says her problems began when the building was bought by the Dermot Company in February. The same developer also owns 266 Washington, where many long-time residents shared similar stories.

I called my City Council representative to look into this matter. The conversation began like this:

"Hi. I just moved into the neighborhood and have found my new landlord to be somewhat negligent. It's a management company called Dermot."

"Do you live at 121 Seaman?" the councilman's associate asked, instantly naming my address.

"Uh... yeah."

"Yeah, they're a big problem," she said, warning me that I should file a rent overcharge form in order to check whether they're also ripping me off on the rent, which has been her experience. She also urged me to attend the upcoming tenant meeting in my building, which she will be present at.

I offer this as a cautionary tale to my fellow New Yorkers and those presently hunting for apartments in NYC: Stay the fuck away from Dermot. They are, to put it mildly, indifferent to the needs of their tenants; and to put it fairly, douchebags.

-Orthodox Anarchist

More like Dermot Mismanagement [Orthodox Anarchist]

While reporting the results of our undercover investigation into IDT-Energy through one of their marketing outfits, a battle waged in the background between us and the current owners of the DS-MAX trademark.

This is our favorite part:

WE ALL SOMETIMES STRETCH MORALS FOR ACCOMPLISHING THE GOAL. IT IS NOT RIGHT IN THE EYES OF GOD, BUT MAN'S LAWS DO STRETCH SOMETIMES TO ACCOMPLISH A GOAL. THE GOAL MAYBE GREED BUT WE ALL SOMETIMES DO IT. IT IS REALITY.

Maybe they should write about Hungary, although we think the editors wouldn't survive how they handle criticism. At least N.A. you can say what you want and not get shot...

It is the individual corporation like Midtown that does the action....Something like Hitler and Nazi Germany, as we probably can both relate.

In our opinion, the old DS-MAX name was getting too hot so its owners decided to do a little brandwashing. — BEN POPKEN

"Richard(office)" richard@activegroup.com
to ben@consumerist.com
date May 31, 2007 8:30 AM
subject re: http://consumerist.com/consumer/investigations/consumerist-undercover-at-idt-energy-day-one-264628.php

Gentlemen: Re the attached link http://consumerist.com/consumer/investigations/consumerist-undercover-at-idt-energy-day-one-264628.php

We wonder if you may be so kind as to correct any references to DS-MAX.

This corporate name, trade mark, trade name and logo is no longer the same organization.

Through legal agreement, we have obtained the full rights and do not have an organization that you refer to.

They have changed their name to Innovage, and therefore your reporter's reference is erroneous and damaging.

As of October 2006, this agreement was finalized.

We would appreciate a correction, in order that dilution and adverse reference is not attached to this corporate name.

Respectfully yours

Nu-Life Inc.

Richard Shapero

Director

—-

Ben Popken ben@consumerist.com
to richard@activegroup.com
date May 31, 2007 8:55 AM
subject Re: http://consumerist.com/consumer/investigations/consumerist-undercover-at-idt-energy-day-one-264628.php

There's no false statements of fact. The post stands. I'll add a note about the name changes and sale, though.

—
BEN POPKEN
EDITOR
CONSUMERIST.COM
ben@consumerist.com
AIM: benpopken
718-306-9088

—-

Richard(office)" richard@activegroup.com
reply-to richard@activegroup.com
to Ben Popken ben@consumerist.com
date May 31, 2007 10:18 AM

Thank you. We are not questioning false statements, merely the company you refer to at the time of your posting does not refer to ours.

As of October 2006 DS-MAX was no longer permitted to represent themselves as DS-MAX and as of April 07, 2007, the name was officially transferred to us for our exclusive use. Therefore, we are tied into what ever actions they have done, yet innocent.

October 2006

11. DS-Max International and DS-Max Canada may continue to use their respective corporate names, namely "DS-Max International Inc." and "DS-Max Canada Inc." for one year following the Date of this Settlement Agreement, but only as corporate identifiers, and not to market any services or goods in association with those names; and after one year following the Date of this Settlement Agreement, the Innovage Parties shall transfer all rights in and to the corporate names DS-Max International and DS-Max Canada to Nu-Life or such other entity as designated in writing by Shapero, but the Innovage Parties shall use their reasonable best efforts to complete such transfer within six months of the Date of this Settlement Agreement.

January 2007

11. DS-Max International and DS-Max Canada may continue to use their respective corporate names, namely, DS-Max International Inc. and DS-Max Canada Inc. until April 7, 2007. On or before April 7, 2007, each of such corporations shall either terminate its existence or change its name to a name which does not include the words "DS-Max" or "DSMax" or to a term confusingly similar to the terms "DS-Max" or "DSMax".

As you can see DS-MAX no longer trades as DS-MAX as of October 2006, and terminates as of April 2007. We have registered trade names, trade marks and logo.

Although we understand your right to report, we only ask for accuracy in that we are not tainted by their reputation of the past.

Respectfully yours and thanks,

Nu-Life Inc.

Richard Shapero

—-

Ben Popken ben@consumerist.com
to richard@activegroup.com
date May 31, 2007 10:09 AM

Right, understood, but the reporter is merely saying that when he read about Midtown, people talked about it being connected to DS-Max. And when he looked up DS-Max, various things were described. So that's all that's being said, and those are accurate statements. The clauses you cite don't impinge on our ability to describe the nature of what was once called DS-MAX. Surely you were aware of DS-MAX's reputation before buying them.

—-

Ben Popken ben@consumerist.com
to Brian Fairbanks
date May 31, 2007 10:14 AM

Yeah, his site looks 100% sketch. A curious turn. Welcome to the rabbit hole!

Here's the WHOIS info for activegroup.com . Hmm, looks like they're based in Toronto, where DS-MAX was started.

Registrant: Make this info private
Active Customs Brokers Ltd.
645 King St W. #600
Toronto, ON
CA

Domain Name: ACTIVEGROUP.COM

Administrative Contact :
Shapero, Richard
admin@ACTIVEGROUP.COM
645 King St W. #600
Toronto, ON M5V 1M5,
CA
Phone: (416) 504-6227

Technical Contact :
Foster, Carl
cfoster@GERONIMOGROUP.COM
2350 Dundas St. West
Suite 701 Toronto, ON M6P 4B1,
CA
Phone: (416)538-3129
Fax: (416)533-0586

Record expires on 12-Feb-2010
Record created on 11-Feb-1996
Database last updated on 15-Jun-2006

—-

Richard(office)" richard@activegroup.com
to Ben Popken ben@consumerist.com
date May 31, 2007 8:10 PM

We were aware of DS-MAX. Midtown were instructed by Innovage not to refer their organization as DS-MAX as it was conditions of our agreement.

When was this interview? Who were the persons representing Midtown. If after October 2006, then DS-MAX has breached their agreement by not issuing firm statements about the cessation of the corporate name.

eing aware of some of DS-MAX reputation, we were aware of. They are however a multi billion dollar corporation, we understand and there is goodwill with the name.

Not all of DS-MAX (the old one is negative), as they are successful. This MLM appears to have some bad apples in them, but it is a MLM with Independent contractors.

We saw the opportunity to obtain the name, trade mark and then take it either with a "good" DS-MAX or use it for another branding (Dollar Store Maximum???). We saw benefit and yes knew there is some negativity with it. Even tried appealing to DSMAXtheaftermath to start a NEW organization, using their experience to make something that would be in line with correcting the bad. They simply want to complain not create.

Understand your position but think you understand ours. DS-MAX is no longer a name connected with the people you refer and it is a written agreement. If Midtown says this, then it is not correct and certainly not with Innovage's blessing. All contracts, agreements were to be changed. Yes Innovage could be breaching and you could be correct or accurate in reporting what Midtown said, but this also leads to us going back to Innovage and going after them for breach.

We win either way... J

Regards

Richard Shapero

—-

Ben Popken ben@consumerist.com
to richard@activegroup.com
date May 31, 2007 11:36 PM

You may have misread. Midtown never referred to themselves as DS-MAX. Other reports talking about Midtown said it behaved like what they conceived of as a DS-MAX affiliate. That's the information we're relaying, that there are reports and they said such and such.

What's the correct URL for Nu-Life? There seem to be some variations out there and I can't tell which is correct.

—-

"Richard(office)" richard@activegroup.com
to Ben Popken ben@consumerist.com
date Jun 1, 2007 9:06 AM

Nu-Life is one of our holding companies, we do not have a website. We will be developing dsmax.com etc., for our decided application using the mark. We have the world trade mark for consumer items and have not decided which way to go. We also have the mark for dsmax, so in essence there will be no confusion.

Still interested, when Midtown people talked about it being connected to DS-MAX. As of October 2006, they should have talked about being connected to Innovage, so DS-MAX's name starts to vanish in the association with this MLM

We were aware of DS-MAX. The reputation, questionably may be the individual corporations, not the actual corporation DS-MAX. When you review the corporation, they appear quite clean, as they do not sell or represent the product or service. It is the individual corporation like Midtown that does the action. Some attempt to present DS-MAX as training them to do so, rather like twisting their arm. If it was so clear then they would be charged.

Something like Hitler and Nazi Germany, as we probably can both relate. Did Hitler do everything or in fact did the Germans want to do what they did and said Hitler told them to. Take out the threat of death element, was it all Hitler or a desire of the people? Not quite a great example but it does give a thought.

All MLM's have a certain blueprint, so they must all have the same mannerisms.

Regards

Richard

—-

Ben Popken ben@consumerist.com
to richard@activegroup.com
date Jun 1, 2007 5:10 PM

* Let me make this very clear: no one at Midtown said DS-MAX. We read that in complaints found online. That's called "following up on leads," something you, being a salesman can relate to. Part of our story is about that process.

* I'm curious as to who were the exact people at Innovage who signed the other part of the trademark change of ownership contract.

* I guess people got that impression about the DS-Max network because the original DS-MAX (now called Innovage) people trained managers, who then opened offices using the methods of running a business they learned. Then they trained new managers in the same methods who then went on to open their own offices, and so on and so forth, like a virus. Presumably, these tactics were also reinforced at the DS-MAX rallies and conventions. Sure, the whole individual offices system is very clever and creates plausible deniability, but that's mainly useful for avoiding legal entanglement. A discerning reader, however, can see the connections.

* Interesting point about Hitler and the Nazis. The same can be said about Stalin and the Russians. I think when you create a system of rewards and punishment, and then apply it to a vulnerable set of people, and deploy propaganda and brainwashing techniques against them, curious things can happen. In Adolph and Josef's case, millions upon millions of people were murdered.

—-

"Richard(office)" richard@activegroup.com
to Ben Popken ben@consumerist.com
date Jun 2, 2007 1:14 AM

* Let me make this very clear: no one at Midtown said DS-MAX. We read that in complaints found online. That's called "following up on leads," something you, being a salesman can relate to. Part of our story is about that process.

CURIOUS WHAT DATES WERE QUOTED.

* I'm curious as to who were the exact people at Innovage who signed the other part of the trademark change of ownership contract.

WITHOUT PREJUDICE, THE PRINCIPLES....TOP GUNS OF DS-MAX...ALL IS VERY LEGAL AND BINDING.

* I guess people got that impression about the DS-Max network because the original DS-MAX (now called Innovage) people trained managers, who then opened offices using the methods of running a business they learned. Then they trained new managers in the same methods who then went on to open their own offices, and so on and so forth, like a virus. Presumably, these tactics were also reinforced at the DS-MAX rallies and conventions. Sure, the whole individual offices system is very clever and creates plausible deniability, but that's mainly useful for avoiding legal entanglement. A discerning reader, however, can see the connections.

IN OUR INVESTIGATION, TRAINING MOTIVATION WAS MADE, BUT INDIVIDUALS USED THIS PLUS THEIR OWN METHODS TO OBTAIN. THE CANDIDATES ARE YOUNG. SEX, DRUGS, FREE THINKING OF YOUTH WITH IMMORTAL IDEOLOGY OF YOUTH TO SCREW THE "OLD SYSTEM" (THEY KNOW NOTHING) (PS I WAS A PRODUCT OF THE 60'S). VERY INTERESTING SYSTEM OF CONSIGNMENT WITH YOUTH. IT GETS OUT OF HAND, AND YES METHODS ARE DISMISSED IF HEAD OFFICE GETS NUMBERS IN SALES.

* Interesting point about Hitler and the Nazis. The same can be said about Stalin and the Russians. I think when you create a system of rewards and punishment, and then apply it to a vulnerable set of people, and deploy propaganda and brainwashing techniques against them, curious things can happen. In Adolph and Josef's case, millions upon millions of people were murdered.

WE TOTALLY AGREE, BUT THE PEOPLE THEMSELVES FOR WHATEVER REASON ARE WANTING TO BE VULNERABLE. EITHER POOR STANDARD OF LIVING, IMMIGRATION, THE HOME BOYS NOT WANTING TO WORK, BUT HATE FOREIGN PEOPLES WANTING TO WORK. EACH EXAMPLE HAS A REASON WHY IT HAPPENED, AND YES THERE WAS A LEADER, BUT THE MASSES WANTED TO CHANGE AND HUBRIS IS THE DEFEAT OF ANY SUCCESS. SOMETIMES YOU CAN MAKE MONEY, BUT NOT THE PERFECT SOCIETY OR ORGANIZATION AS IMPERFECTION IS INHERENT IN MAN'S PERSONA ALTHOUGH EGO AND GREED MASK IT. MARXISM WAS TO BE ENGLAND, NOT RUSSIA, NAZISM WAS TO BE AUSTRIA, NOT GERMANY. STRONG ECONOMIC POWERS WERE TO ADOPT THESE SOCIALISTIC, IDEOLOGY OF EQUALITY, YET ALL HAD TO APPEAL TO THE MASSES, ROB THE RICH, POWERFUL MINORITY. UGANDA, TANZANIA, RHODESIA, EASTERN BLOCK CHANGE FROM COMMUNISM TO CAPITALISM, AND EVENTUALLY CHINA WILL SHOW THE SAME. MAN IS GREEDY, RELIGION USES FEAR OF SOMETHING BEYOND MAN'S CONTROL, GOVERNMENTS CONTROL THE NATURAL INSTINCT OF MAN TO SELF SATISFY, AND EVEN MLM TURN CORRUPT. PEOPLE AT THE TOP WANT ALL, AND ALL THROUGH THE SYSTEM AT EVERY LEVEL, EVERYONE IS OUT FOR THEMSELVES. A BLIND EYE IS USED WHEN THE BOTTOM LINE IS SUCCESSFUL. IN YOUR BUSINESS, IF INFORMATION IS OBTAINED BY SORTING THROUGH GARBAGE AND IT ISN'T ILLEGAL, IT'S ACCEPTABLE AND CONSIDERED ACCEPTABLE, BUT MORALLY IT IS NOT RIGHT. WE ALL SOMETIMES STRETCH MORALS FOR ACCOMPLISHING THE GOAL. IT IS NOT RIGHT IN THE EYES OF GOD, BUT MAN'S LAWS DO STRETCH SOMETIMES TO ACCOMPLISH A GOAL. THE GOAL MAYBE GREED BUT WE ALL SOMETIMES DO IT. IT IS REALITY. WE WISH THE WORLD WAS PERFECT AND ALL BLAMELESS, BUT SOMETIMES WE LOVE THE OLD ADDAGE ....WHEN YOU POINT A FINGER, REMEMBER ONE IS FORWARD AND FOUR POINT BACKWARDS. BUSINESS SOMETIMES IS LOOKING AT A SITUATION THROUGH DIFFERENT ENDS OF THE TELESCOPE.

* WE BELIEVE THAT THE IDEAL OF DS-MAX IS CORRECT, BUT HOW PEOPLE OBTAIN SUCCESS AND USE OTHERS IS NOT. ALL BUSINESSES THAT HAVE OWNERS VERSUS WORKERS, DO USE PEOPLE TO OBTAIN SUCCESS. WE DON'T CARE WHAT BUSINESS...THAT IS PART OF A CAPITALISTIC SOCIETY AND YES IT HAS BOUNDARIES. SOMETIMES PEOPLE STRETCH THEM. SOMETIMES BOTH ON THE TOP AND ON THE BOTTOM. REALLY HOW MUCH DOES DS-MAX DO ILLEGAL, OR DO THEY EXPLOIT PEOPLE BY INSTILLING FALSE SUCCESS AND DREAMS, AND THEN IT CARRIES ON ALL THE WAY DOWN THE LINE. A SNOWBALL EFFECT OF GREED.

* HOW DO YOU PROTECT YOURSELF WHEN YOU ARE AT THE TOP OF THE LINE. EVEN THE CHURCH HAS IT'S OWN CORRUPTION. IN THE NAME OF GOD, SOME PRIESTS ARE PLAYING WITH CHILDREN, STEALING FUNDS, HAVING SEX. IS THE POPE RESPONSIBLE?...HOW MUCH DOES HE KNOW OR THINKS HE KNOWS? HOW MANY HAVE BEEN HURT IN THE NAME OF GOD.

* WE OBTAINED DS-MAX EVEN THOUGH WE KNEW THERE WAS NEGATIVE, BUT IT DOES HAVE A WORLDWIDE NAME. THE QUESTION IS, CAN THE KNOWLEDGE OF THE NAME, THE PAST USE OF IT, BE TURNED INTO SUCCESS IN ONE WAY OR ANOTHER. DS-MAX CAN STAND FOR MANY THINGS. WE THOUGHT OF DSMAX (DATA STORAGE MAXIMUM/DIGITAL SYSTEM MAXIMUM,/DOLLAR STORE MAXIMUM) BY OBTAINING THE NAME, RIGHTS, HISTORICAL USE AND TRADEMARKS WE ELIMINATE OTHERS FROM INFRINGEMENT AND PASSING OFF, TO EVENTUALLY LAUNCH SOMETHING, SOMEWHERE, WITH THE DUCKS IN ORDER, SO INFRINGEMENT CAN BE LEGALLY DEFENDED. DS-MAX CAN BE PROTECTED LIKE SONY OR IBM OR DELL'S NAME.

* WE TRIED APPEALING TO THE AFTERMATH PEOPLE AND THEY JUST WANTED TO BASH. UNHAPPY PEOPLE, BURNED IN THE ORGANIZATION, WITH NOTHING BUT NEGATIVE. WE ASKED IF THEY WANTED TO HELP CREATE THE SYSTEM IN THE RIGHT WAY BUT NO TAKERS. ONLY BASHERS. LIFE'S SUCCESS IS BASED ON POSITIVE ACTION NOT NEGATIVE. YET IF YOU ASKED ALL THESE PEOPLE WHAT THEY DID, WE ARE SURE THEY WERE PART OF THE DRUG, SEX, SCANDAL, SCREW THE DUMMIES, LIFE AND ENJOYED IT, UNTIL THEY GREW UP AND REALIZED THEY WERE GOING NO WHERE. YOUTH DOES THAT IN ALL OF US, UNLESS WE WERE NERDS DURING THAT TIME. REBELLION IS PART OF YOUTH, ALL KNOWING, BIG EGO AND GOING TO FIX THE SCREWED UP WORLD. YOUTH IS BLACK AND WHITE WITH NO GRAY. GROWING UP, REALIZES MOST OF LIFE IS GRAY AND BLACK AND WHITE IS LESS AND LESS. DS-MAX PLAYS ON YOUTH TO SELL PRODUCT BASED ON DREAMS YOUTH CAN CONQUER ALL FOR THE ULTIMATE GOAL OF MONETARY SUCCESS. ALL MLM'S PROFESS THAT. MOTIVATORS PROFESS THAT TO FIRE UP PEOPLE. DS-MAX DOES IT TO SELL A CALCULATOR. DON'T YOU THINK THE INDIVIDUALS KNOW THEY SHOULD HAVE CERTAIN LICENCES, PERMITS, ETC., YET THEY ABUSE THAT. DON'T YOU THINK THEY KNOW THEY HAVE TO PAY TAXES. THEY ALL PLAY A GAME FOR THEIR OWN BENEFIT AND THEN POINT A FINGER AT OTHERS FOR BEING WRONG.

* PLEASE KEEP THIS BETWEEN US, AS WE THOUGHT WE WOULD CONVEY OUR THOUGHTS OF WHAT THE COMPLAINT IS. COPS ARE ON THE TAKE, THE CHURCH IS CORRUPT, YOU SOMETIMES GET INFORMATION VIA A ROUTE THAT IS NOT ALWAYS ABOVE MORALS BUT WE ALL DO IT AND YES IT IS NOT RIGHT, BUT WE ALL WANT TO FEED OUR FAMILIES AND OUR DREAMS.

* REGARDS
* RICHARD SHAPERO

—-

Richard(office)" richard@activegroup.com
to Ben Popken ben@consumerist.com
date Jun 2, 2007 8:14 PM

Funny how we have advised you of our position, and just recently your article after our disclosure, has now posted the exact logo we own, and we don't know of anywhere on the internet you could find the logo.

http://www.consumerist.com/consumer/ds_max/

Could you explain, where you are finding the logo that is not permitted and why it looks so similar?

http://tess2.uspto.gov/bin/showfield?f=doc&state=7il50g.2.2

We are quite puzzled, how the name DS-MAX seems to be more used and we had hoped it would be contained.

Are we inciting you, or have offended you to develop the name DS-MAX more in an adverse manner?

Regards

Richard Shapero

—

Ben Popken ben@consumerist.com
to richard@activegroup.com
cc legal@gawker.com,
date Jun 3, 2007 10:50 AM

Richard,

Just because the USSR split into the Commonwealth of Independent States doesn't mean you can't use the hammer and sickle to illustrate the Soviet Union.

I never gave you off the record status, nor see a compelling reason to do so, so I cannot promise we will fulfill your request at the end of your previous email to "keep this between us."

I'm happy to continue to talk with you about MLM, DS-MAX, and even WWII history. However, I do not recognize your claims of alleged adverse development, and if you wish to develop further discussion along those lines, you can contact our lawyers at legal@gawker.com.

—-

Richard(office)" richard@activegroup.com
to Ben Popken ben@consumerist.com
date Jun 3, 2007 9:28 PM

If you made an agreement under legal counsel with the USSR to use the hammer and sickle and they no longer could use, plus the Name USSR, then the Soviet Union could only call themselves the Soviet Union and not use the hammer and sickle.

Of the record is quite mute, with your interpretation of political and possibly poetic license.

Who is gawker.com and are you affiliated with them?

Do you have the specific lawyer's names, so our counsel can contact them. We would appreciate specifics on your company Name and Address, together with theirs.

Consumerist and Gawker both appear to be Hungarian. Is this why you used the USSR analogy?

It appears there is no address other than e-mail with contact. Is this the address of Gawker Media, who controls your content.

Gawker Media
76 Crosby
New York, NY 10012
(212) 655-9524

The domain names seem to be held by non Americans, although Gawker Media appears to be US. Maybe they should write about Hungary, although we think the editors wouldn't survive how they handle criticism. At least N.A. you can say what you want and not get shot... J I think Gawker somewhere says everything is anomynous unless you want your name posted. Does that apply throughout all their divisions????

Regards

Richard

Gawker.com appears to be:

Administrative Contact:
Attila Talos (NIC-14521774) BLOGWIRE HUNGARY SZELLEMI ALKOTAST HASZNOSITO KFT.
Frankel Leo u. 106-108. Budapest - 1023 HU
domains@gawker.com +36.12126559524 Fax- -
Technical Contact, Zone Contact:
Attila Talos (NIC-14521774) BLOGWIRE HUNGARY SZELLEMI ALKOTAST HASZNOSITO KFT.
Frankel Leo u. 106-108. Budapest - 1023 HU
domains@gawker.com +36.12126559524 Fax-

Consumerist.com appears to be:

Administrative Contact:
Attila Talos
(NIC-14521774)
BLOGWIRE HUNGARY SZELLEMI ALKOTAST HASZNOSITO KFT.
Frankel Leo u. 106-108. Budapest
-
1023 HU
domains@gawker.com +36.12126559524 Fax- -
Technical Contact, Zone Contact:
Attila Talos
(NIC-14521774)
BLOGWIRE HUNGARY SZELLEMI ALKOTAST HASZNOSITO KFT.
Frankel Leo u. 106-108. Budapest
-
1023 HU
domains@gawker.com +36.12126559524 Fax- -

—-

Ben Popken ben@consumerist.com
to richard@activegroup.com
date Jun 4, 2007 4:37 PM

Richard,

Email legal@gawker.com and you will receive a response.

—-

Richard(office)" richard@activegroup.com
to Ben Popken ben@consumerist.com,
lega@gawker.com,
rdas@berkowcohen.com,
Jack Smugler
date Jun 4, 2007 9:44 PM

Ben:

Thank you, but my counsel does not write to e-mails without an address. It is not normal, professional protocol.

If you would be so kind as to confirm the address we gave you it would be complete.

We have c.c.'d our litigation team to prepare our reply, in order that we don't have a p*ssing match over this.

We believe you are entitled to freedom of information, but have been advised that your references to DS-MAX after the date of October 2006, are not valid

And the information you have is not accurate. Some of your information, appears to have been developed since 2004, so we are not aware if Midtown even exists today, or the information you have obtained is current or dated.

We wish to address the appropriate party and not deal with a moving target. We presume you are a legitimate information bureau and part of Gawker Media of New York.

We wish that your information is not diluting the value of our asset, while attempting to address a MLM called Innovage Inc.

Regards

Richard Shapero
Nu-Life Inc.
DS-MAX Inc.
DS-MAX International Inc.

DS-MAX Canada Inc.

—-

Gaby Darbyshire
to richard@activegroup.com
cc Ben Popken ben@consumerist.com
date Jun 5, 2007 11:52 AM
subject DS-Max

Dear Mr Shapero,

Ben has forwarded me all of your correspondence. I handle legal matters for Consumerist, and I have reviewed the matter in hand.

I am not sure what it is that you think we have done that is in breach of the law. It is fair use for us to use a trademark to describe its user, even a former user: it's common practice to illustrate stories about companies with their logos. There is simply no basis for a claim against someone who refers truthfully to a former use of a trademark, even if the current holder of the mark wishes to distance himself from that use. Particularly where the use is in the context of news reporting, rather than competition; I can thus see no valid objection to Ben's posts.

If you bought a trademark with baggage, I'm sorry, but that is not a legitimate reason for us not to report on a valid story using the principles of free speech enshrined in this fair country's constitution. I'm afraid that in the circumstances, we are not prepared to remove any of the material in question.
You must of course proceed as you see fit, but as a matter of common sense, I am sure you must know that news stories tend to become old pretty quickly if they are not given legs.

Best regards,

Gaby Darbyshire

—-

from: "Richard\(office\)" richard@activegroup.com
Date: June 6, 2007 12:57:00 AM EDT
To: "'Gaby Darbyshire'" "'Ranjan Das'" rdas@berkowcohen.com

Dear Ms. Darbyshire:

Thank you for your e-mail of the 5th instant, contents of which are duly noted.

While we agreed with much of what you say, to report a matter that occurred in 2006, and your undercover reporter, "apparently" in 2007, uncovers a breach of agreement between ourselves and Innovage. With all due respect, it is very important to be accurate. Without accuracy it is of no importance to the public, yet damaging to our company.

We have requested from Ben Popken, if the company still exists and the advised him of the existence of an agreement to the rights of the name and mark, together with excerps of agreement and trademark holder as of October 2006 and 2007.

If you are accurate, then DS-MAX (Now Innovage) is in violation of the agreement. If you are inaccurate, then you are in violation of presenting inaccurate and false information.

To bring up this issue, years after, and quote some representative as knowing the actions are DS-MAX is inaccurate and damaging. You, or should we say, Gawker Media, Consumerist, have a fiduciary duty to report accurately. Failing to do so, is in our opinion a breach of the law. Reporting accurately, is a witness to a breach of agreement between Innovage and ourselves. Which is it?

While we have enjoyed the banter with your colleague, our purpose was in attempt for Ben to report accurately. We do appreciate one mention of DS-MAX referred to as Innovage Inc..

Presuming you have not studied the corporate relationship and contracts, of Midtown, with DS-MAX and IDT, we find it hard to accept the report as accurate but would appreciate you clarifying, in order that we may proceed against Innovage for breach, with you as witness.

We would appreciate your advising us of exactly when your people were advised of DS-MAX as the culprit, or alternatively correct and cease referring to DS-MAX.

As we used a Germany/Nazi reference to Ben, we simply would like you to refer to the correct company. Today you refer to Germans as Germans. To refer them to Nazi's was what German were, not now and inaccurate reference does them no justice. Hungarians are Hungarians now, not Communists as they were before. It would be only fair and accurate to refer to what you are talking about at the time you are talking. Innovage is today, Germans are today and Hungarians are today, not DS-MAX, Nazi's and Communists. The past is the past and present situations should reflect accuracy.

As a question, are you actually legal counsel under the Bar of New York State, or only a representative? If not, we would appreciate being directed to your legal counsel, in order that our counsel can continue with them directly.

Although, you state this article will eventually disappear, unfortunately, the internet will retain this information, unless you remove this from your archives and lose the link. It will continue to effect the name DS-MAX, unjustly due to inaccuracy.

Regards

Richard Shapero

—-

From: Gaby Darbyshire
Date: June 7, 2007 11:13:14 AM EDT
To: richard@activegroup.com
Subject: Re: DS-Max

Richard,

Once again, it is simply not our problem that you chose to purchase the brand name and mark of a company about which there is a lot of factual, undisputed, adverse material in the public domain. So, DS-Max became Innovage. The renaming of a company doesn't affect the right of journalists to comment and report on the actions of the company as it was, and as it now is: it's the same company, doing the same things it always did. We have clearly stated in the article that DS-Max became Innovage. It *is* the same company. We can't not refer to DS-Max, which is a well-known entity, or our coverage would make no sense, because Innovage did not exist at the time of the actions referred to. Whether or not Innovage and the new DS-Max (your company) are in fact still associated is a matter we have not yet addressed, but we would have every right to do so. That is called investigative journalism, and that's what we do. But that is not currently the focus of our coverage.

Nonetheless, as a matter of courtesy, we have edited the piece to make it clear throughout that we are referring to the old DS-Max (now Innovage).

Other than this, we are simply not going to change our coverage. You should consult your lawyers. I am certain that they will tell you that we are not breaking any laws in reporting as we are.

Best regards,

Gaby

—-

From: "Richard\(office\)" richard@activegroup.com
Date: June 8, 2007 12:01:51 AM EDT
To: "'Gaby Darbyshire'", "'Ranjan Das'" rdas@berkowcohen.com
Subject: RE: DS-Max

Thank you for your information, and thank you, as a matter of courtesy, edited the piece to make it clear.

Please be assured, that our company and Innovage ARE NOT associated in any manner and legal documentation is quite clear about this.

We can understand your comments about DS-MAX becoming Innovage, the right of journalists to comment and report and you can not refer to Innovage, as your coverage would make no sense.

However, if the independent company, Midtown, which is not a subsidiary of DS-MAX, tells you they are affiliated with DS-MAX, and our agreement controls reference to the name of DS-MAX, on and after October 6, 2006, there is some breach of use of the name. If the information you receive is erroneous, and you ignore our advices of such error, you continuing developing a story, is in essence improper reporting, with knowledge that the information is incorrect.

If, finally, in the end, you discover that your report using Midtown information is quite factually wrong about impropriety of a company, whether you call it DS-MAX or Innovage, and Midtown's actions are not attributable to DS-MAX or Innovage, you do have a sticky wicket, in that, firstly the content of your report is erroneous and damaging to Innovage and secondly, totally damaging to us DS-MAX, with full knowledge that not only has your source given you poor information, but also one of the parties has advised you of effective dates, and separation of the company name DS-MAX.

You are of course, permitting to publish whatever you wish, but do have a possible liability from both Innovage and ourselves, for two different reasons.

Magazines are sued for misinformation on a daily basis, and some do have to pay for there erroneous, damaging information. We believe we have provided you with sufficient information as to the dates of application of the name, usage and rights of the independent parties DS-MAX (us) and INNOVAGE. At the same time, we have advised you, that Innovage, formerly DS-MAX is not related legally to Midtown, and contracts exists as we believe separating these companies. Under contract law, sub contractors and contractors do have limited liability and responsibility.

From our limited knowledge, these independent companies and Innovage, have been attempted to be married for decades without legal satisfaction or precidenct.

Certain reference areas, such as DSMAXtheaftermath, Ripoff Report, etc., are in themselves quite questionable, and a moving target, that no one can serve legal service. You, however are more like a bona fide Inquiry or Star type reporting source, that is not a moving target and appear to have assets.

This is our opinion, and believe concurred by our legal counsel, as unlimited rights are not yours, and have a responsibility to report accurately.

Again, we ask if you are legal counsel for the company and qualified to represent them. We do not wish to have any misunderstanding and direct our legal counsel's instructions to the proper areas, being able to quote statements as representation of the company.

For your information, Rippoff report has the following questionable standard that we believe places a cloud of doubt to their ligitimacy.

http://www.klaasdevriesjr.nl/k-files/talentrock/Bureau%20of%20Ethical%20Internet%20Commerce%20(BEIC)%20050310.htm
http://www.ezripofflawsuit.com/
http://www.bad-business-rip-off.com/
http://www.bad-business-rip-off.com/wsvnvideo.html
http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=104&STORY=/www/story/07-25-2003/0001989115&EDATE=
http://www.goodbusinessbureau.com/absconded.html
http://www.goodbusinessbureau.com/rap1.html
http://www.goodbusinessbureau.com/rap2.html
http://www.goodbusinessbureau.com/rap4.html

In reference to the people of DSMAXtheaftermath, we believe that a great many of them, knowingly worked illegally with many of the subcontractors, none worked for DS-MAX (Innovage) directly and many never paid US income tax or properly filed returns. Federal offenses, we believe.

Wofram appears to have a disclaimer. What is a DS-MAX sales associate?

http://wolfram.org/eric/ This is your author and disclaimer.

The content of this Ds-Max information was written by an ex Ds-Max sales associate who asked me to publish the information on my web site. We hope that others will find the information that they need to make informed decisions. The author asked that his or her name be withheld. If you have any questions, additions or suggestions, please feel free to ask Eric.

Note the points were some of Richard's paragraphs are signed "J..." Those could possibly be places where Richard cut and pasted from Jack Smugler's emails. In the original email, these parts are indented and use a different font, potential evidence of a cut-and-paste.

There's definitely fun to be had by looking up each of the party's addresses via WHOIS, as well as then address in the trademark office listing, and then Googling to see what turns up.]

UPDATE: Even more gobblydeegook!

—-

From: "Richard\(office\)"
Date: June 12, 2007 11:15:51 PM EDT
To: "'Gaby Darbyshire'", "'Ranjan Das'" , "'Jack Smugler'"
Subject: RE: DS-Max

Thank you for your information. We will pass this on to our litigators (barristers) as you being the contact. Will you accept service for the company, and would appreciate the full name and address for such service?

As we worked many decades ago in the UK, and Canadian law is similar to British, we are aware of the limits of a barrister, versus solicitor, the most famous of which we directly dealt with was Sir

We will reserve the right to comment on your opinion of liability and what your company can and can not represent in your article. As we have obtained all rights to the trade name and trade mark, including interest and power to defend, we wonder if the source of information, if inaccurate, falls within US law of damages due to misinformation given to your people, that is not accurate but merely some figment of someone's imagination. Your articles and exhibits, do not show any reference to DS-MAX and the interview may not be from a knowledgeable person. Although, we are not in the position to defend or confirm the information given to your company, you do have a fiduciary duty to report accurately. Even the "Inquiry" and other rag magazines, have through court decisions required not to defame an actor's reputation with misinformation. This may also apply to reporting on companies and the sources of your information. Again, that will be a decision on our counsel's part.

Our rights are as follows FYI : Subject to the provisions of paragraph 11 and 12 below, as of the date of this Settlement Agreement, the Innovage Parties shall and do transfer to Nu-Life all of their rights, title and interests anywhere in the world in any trade mark, trade name, corporate name or domain name which includes the term DS-MAX or the term DSMAX and any term confusingly similar to the term DS-MAX or DSMAX:

We appreciate Ben's comment "ed. In 2003, DS-MAX split into three groups, Innovage, Cydcor, and Granton Marketing. In 2006, a company called Nu-Life bought all the rights to DS-Max's name. Why? We have no idea.]" but would have appreciated a correction to every reference to DS-MAX, especially after October 2006 referenced dates.

Regards

Richard Shapero

Nu-Life Inc.

P.S. In respect to your continued membership of the UK bar, it does appear to be evident. The only Darbyshire is the below member of an active member Darbyshire.

home / directories / the bar directory / individual barristers / by name: d / mr william robert darbyshire

self employed barrister profile

Mr William Robert Darbyshire

9 St John Street

Manchester

M3 4DN

[ed. Note: No definitive ties have been established between Midtown Promotions and DS-MAX/Innovage.]

This is part 7 of our undercover investigation into IDT Energy, an energy reseller in the New York area...

We met at a pizza parlor in Ft. Greene, Brooklyn. I'll refrain from details about his appearance and say only that he was wearing a T-shirt that said "Bronx" on it. He carried nothing with him, his ex-girlfriend having smashed up his PDA the night before. He seemed vulnerable because of this, but not afraid.

He told me that he had worked for Midtown in the past, and gave me some dates (which matched with his earlier statements.) He seemed pretty open to whatever I wanted to know, and had lots to say about Midtown's relationship with IDT.

"I did that. I did IDT for a while. [Midtown] will bring in marketing people, they teach you what to say, how to do it, when to do it. You go out to the territory; you go where you gotta go to get the money." He went on, covering mainly what I'd already learned. "They make you an independent contractor, they make you sign the forms. They tell you do what you gotta do."

"Did they say that? 'Do what you gotta do to make the sale?'"

He said that they are reminded repeatedly to follow the manager's instructions, but many are so desperate to make a sale, they don't care.

"So, did you see people wearing the uniforms?"

He answered in the affirmative, and mentioned having seen people in Con Ed hats and other outerwear.

"When you saw people in Con Ed stuff, where were they? Were they in the office of Midtown Promotions? Did they arrive there dressed like that?"

"No, nobody."

"So how do you know they were doing it?"

"Well, basically, once you get in the field, it's different." Vega stopped for a moment then backtracked. He started to explain how few of his co-workers were educated and wise in the ways of ethics and marketing. "They think everything they should do is for the dollar, that it doesn't matter what their company tells 'em, that it's what the individual does that counts. So, when the individual goes out in a Con Ed hat, the company just says, 'Well, we didn't train them that way.'"

I told him that I'd been with IDT for a week and that I didn't notice anything immorally deceptive, other than questionable pitches. "When you were out there," I asked, "You were just dressed professionally, with your tie, whatever. Where did other people put on their stuff? Was it on the subway...?"

"When you work with somebody else, sometimes they'd just throw on a shirt." He speculated that the workers had found or had made their own Con Ed patches and put them on some cheap blue work shirts that made them look like they were utility employees. "Or they'd go buy something that said Con Edison on it." But he said he wasn't positive how the fraudsters came about the gear, only that he certainly saw multiple employees in the field in the finished getup.

"Did anybody ever talk about it, in the office?" I mentioned several employees' names to see if it would jar any memories of wrongdoing by higher-ups.

"No, they always talked about it every day, about how we weren't supposed to do that. They could tell you in the office... but once you leave, you're an independent contractor..."

I tried a different angle. Did he know anyone specifically who knew about the fake (or real) Con Ed uniforms or wore them personally?

Unfortunately, he claimed he couldn't remember any specific names of employees who had committed fraud. Perhaps he was afraid of something at this point. He seemed to clam up for the first time in that half hour. I wondered if he was feeling protective of Midtown all of a sudden.

Look, he said, "I know there's gotta be a certain reason you're going after [Midtown], but they're a legitimate company. The only thing is... the representatives, some of them, are no good. They need to hire people who can really do the jobs and pay them a little more. But IDT is not going to pay them [enough]."

Finally, I asked, "Definitively... have you seen people you know are employees of Midtown Promotions, wearing Con Ed uniforms?"

"Sometimes. Yes."

I went to the office to confront my manager.

E: So, what's up, buddy?
B: So, Eric, I wanted to talk to you in private...
E: Yeah. You disappeared...
B: Well, there's a couple reasons why. I was sick on Friday, that is true. But... the one thing I'd like to ask you about... there are people working here that are doing things that are obviously... fraudulent.
E: Meaning...?
B: They are wearing Con Ed attire.
E: Con Ed attire?
B: Yes.
E: What're you talking about?
B: Well, actually, I'm a journalist—

His eyes bulged, but he immediately recovered and took this in slowly.

E: Uh huh.
B: And I've been investigating this for a long time now... and we've received tips that it was this company... and I met with someone who used to work here and he was willing to speak on the record, and I have a recording that...
E: ...wearing Con Ed attire?
B: They were wearing actual shirts with the words Con Edison on them.
E: Do you have... someone in here now?
B: He doesn't know, he doesn't work here anymore, so he isn't sure if those people are still working here... He said that they would leave here and that they would acquire a grey or whatever color Con Ed shirts are... and then they would have a patch made based on the logo.
E: And why would that not be brought to my attention from [before]...? Because I know that they've got their grey shirts that say IDT, the IDT laminate, the IDT card. Never heard about Con Ed, never got any complaints, never heard anything of that nature.
B: So, all this stuff about 'don't misrepresent yourself as Con Ed,' that's just from your own fears that someone will do something like this?
E: Well, when you deal with different reps, unfortunately, with different locations, you have 60, 70 reps out there... I'd love to be able to see that people do things by the book, but... when you do have complaints that come through the human resource department, you get rid of that person. You understand? People going out, using the Con Ed, Keyspan name to get a sale, that's totally wrong.
B: Would you be in trouble if IDT received complaints about employees here?
E: If I found out that that person had a Con Ed shirt on, I'd get rid of them in a heartbeat.
B: No, I mean, would Midtown be in trouble with them—
E: I don't understand what you're saying...
B: What I mean is: If someone were to get in trouble and IDT were to receive complaints, do they come down on you guys?
E: They'd call us to look into the matter... one hundred percent... because they contract us to do their marketing for them... to a hundred percent. If we have a fraudulent rep out there, we're not going to just [let them] keep going out there and signing applications. That's misleading, that's totally contradictory to everything IDT stands for. When you have two or three locations out there, and you have locations that aren't affiliated with us that are here in the city that represent for IDT, too, that we have no control over...
B: Okay. So, just to be clear, you've never heard of this... with the shirt?
E: No.
[I tell him there are articles in the Consumerist alluding to the fact that this company at this location has sent those scammers out in the field. I also mentioned that the scammers, except for the part where they replace their affiliation with the name "Con Ed," is almost the word-for-word pitch of Midtown reps. He said that if anybody used the Con Ed or Keyspan name to identify themselves, they would be immediately terminated. "If say to say," he added, "On my side, I haven't had too many issues" with employees bending or breaking the rules.]

E: ...I have nothing to do with what the [Midtown] offices outside of [this one] do... I have no control over that. They're independent offices... but as far as our side is concerned, we rarely hear about someone coming across as misrepresenting themselves. But when we find out about it, because they're independent and, a lot of times, they could be out there saying the wrong, doing the wrong things... I'm not gonna deny that... but it only comes back to us if someone complains to IDT...

DS-Max

Eric denied that Midtown is owned by DS-Max. He knew of DS-Max, having worked there for 16 or 17 years, but he claims that they are independent entities.

E: That's a big company... Nothing wrong with it... they do an unbelievable job [with] the concepts that they do. But we're independent, so we got nothing to do with them. I know they're in the city as well, I know they're in Long Island...
B: Do you think it's possible that they, because, the pitches are very similar, that it's possible that it's not Midtown, that it's a DS-Max affiliate that has an IDT contract?
E: No, I think they're also independent, too. I don't think DS-Max is involved with IDT at all.

He deflected some more criticism by saying Topline, out of Queens, also dos the same work for IDT.

E: Did you find any beef...?
B: The guy who used to work here— he was out with people who put on the shirt. He saw this while he was here...
E: How long ago was this?
B: ...about three months ago when I saw it... and I don't want to give too much detail that might reveal who he is, but it was sometime in the last two to six months that he left [Midtown.]
E: ...Well, we like to say that everything goes well out in the field until you bring something like this to my attention... we want to make sure there's no other guys doing that. Maybe it was a guy in the past, and there was a complaint [about something unrelated] and we had to let him go, and we never found out about the t-shirt. ...Maybe it's from another location.
B: The people that he saw were from this location.
E: Unfortunately, I can't have anything to say about that... I can't vouch for that, I've never heard of it.... I mean, I let guys go on two warnings on using [the name] Con Ed. What do you think I'd do about the t-shirt? And I pray to God that none of these guys here are affiliated with that t-shirt.
B: It's possible those people are gone...
E: [Bad] things that happen, you gotta let 'em go. Because if you don't, it makes your business look bad. I think if it was really that bad, the commission would've shut us down a long time ago. They send guys like you in, checking it out... you know, I've got nothing to hide... honestly, I know about the Consumerist, I know about the [intern] that came in, I had a feeling you were with them, I'm not playing games anymore. I'm just putting it out in the open. The more we hide games, the more you guys wanna run with things. [Could be a slipup or just a poor choice of words... but interesting nonetheless.] And you got in here firsthand, and you saw they aren't... switching the badges or whatever... I wish I had a camera on all these guys, making sure they're doing all the right things...

And later...

E: I've seen the pictures, I've seen [the intern's] write-up... and all honesty, as a business grows... expands... it's like anything... you're gonna have some people that are gonna do some wrong things in the field... you can't make everybody happy. As long as at the end of the day, we have people out there doing the right thing, I can go to sleep good... It's usually the newer guys,"