Legal Question in Investment Law in New Jersey

Hi, I made a $10,000 investment into a friend's company during what I am figuring was a pre-IPO period. The only proof I have seen that the company is filing for an IPO is an S-1 draft he had sent me back in April of this year as well as activity I have seen on SEC.gov. However, the last activity I saw was back in May of this year. He first told me they were going public in June. Then I did not hear from him until early August when he said they were targeting August 15. I sent him a text around that time and received no response. I heard from him on Labor Day Weekend in September and he said it was supposed to be August but now should be any day. I asked if it will probably happen in September and he said yes. Then Columbus Day came around and he said it should be any day now. Still nothing yet.

$8,000 of this investment is on a credit card that I have been floating from month to month. The other $2,000 is from a loan I gave him back in July 2017. Instead of paying me back, he said he made an "executive decision" and invested it in the pre-IPO. I have been told my investment is "valued" at $100,000. However, I have a hard time believing that because I have not been issued anything with my name on it. The only proof I have that I sent him money is the text messages and the transactions on my American Express statement.

At this point, is there much I can do to get the money back if I want it?


Asked on 11/06/18, 9:23 am

1 Answer from Attorneys

You can always file a lawsuit to demand your money back and use the sms and credit card statement as proof but as you correctly pointed out that may not be sufficient evidence. Therefore you need to "build a case" and get better evidence and/or admissions from your friend in connection with the money you loaned.

In addition, if the company is getting ready for an IPO then you may have a much larger claim than simply getting your money back.

You ought to consider a formal legal consultation so that an attorney can review the existing evidence and propose a strategy to procure further evidence and admissions as well as review the pre-IPO status of the company.

My office offers LawGuru users a flat fee consultation of $299. Please use this link to reserve a discounted consultation

Looking forward

Roman R. Fichman, Esq.

www.TheLegalists.com │ @TheLegalist

email: Info (@) TheLegalists (dot) com

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Answered on 11/06/18, 10:45 am


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