Legal Question in Business Law in California

I have a question about how to pursue a claim against a company which owes me money for contract work performed. It has a twist, however:

- It's clear the company is actually insolvent, though it continues to operate as if it is a going concern. It has been making verified false claims that it has sufficient cash and new investment closed, but missing payments when due or simply telling creditors "I won't be paying."

- My contract has a binding arbitration clause in which I must pay a couple of hundred dollars to initiate arbitration

- The companies continues to solicit new contractors to do work, telling them again that the company has sufficient funds when it does not.

- As far as I can tell, there is no board of directors or additional directors besides the CEO

I'm not sure if I should file an arbitration claim, or pursue this in court because the company is operating in a way that is deepening insolvency.

Any suggestions for how to best pursue this debtor, and also what venues can be used? Must I pursue this in arbitration given the state of the company?


Asked on 6/27/10, 10:45 am

2 Answers from Attorneys
Kevin B. Murphy Franchise Foundations, APC

Any attorney will say a review of all facts, documents, etc. is required. After that, a personal consultation is needed. This is not a simple bulletin board type question. Consult with an attorney in your area for specifics.

Kevin B. Murphy, B.S., M.B.A., J.D. - Mr. Franchise

Franchise Attorney

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Answered on 6/28/10, 6:59 am
Daniel Bakondi The Law Office of Daniel Bakondi

An important question is whether you can go after the individual also. I would try. I can also help you pursue your employer in arbitration, or litigation, as is proper. Please send me an email with some details. I need to take a look at your arbitration clause and other documents. If you choose arbitration or court and choose wrong, you could impact your rights and run into problems. This decision can be fairly complex.

Best,

Daniel Bakondi, Esq.

[email protected]

415-450-0424

http://www.danielbakondi.com

The Law Office of Daniel Bakondi, APLC

870 Market Street, Suite 1161

San Francisco CA 94102

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Answered on 6/28/10, 10:37 am


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