Ask HN: Got scammed by startup company, how to find a Delaware lawyer?

https://news.ycombinator.com/item?id=8632462

by makeluvnotwar • 12 years ago

12 15 12 years ago

news.ycombinator.com

Group of 4 remote full-time developers including me got scammed by employer, a startup company registered in Delaware.

Employer haven't paid for 2 months using lame excuses about visit to a bank, sending fake payment references.

We're located across the world and never thought about situation like that, have no idea how to protect ourselves.

We tried to contact founders, investors to solve this issue. Radio silence.

Should we look for a lawyer or a labor comission? How to find a good lawyer in Delaware?

Any ideas or help are very appreciated.

cylinder2• 12 years ago

Were you employed (on the payroll) or were you independent contractors?

makeluvnotwar6• 12 years ago

Agreement states that we're independent contractors, but scope of work section tells:

  As a Software Engineer at %company name% you will be developing 
  applications for the %company name% Platform.
  
  Your starting date will be %date%. You will work as a full-time member 
  of the team from %my location%. Full-time member assumed 
  to be working five days in a week (Monday till Friday), 8 hours a day.

techjuice2• 12 years ago

Depending on what you did and the conditions of how were supposed to do your work, you may actually be classified as an employee. Even if you were given a 1099 if your in the USA depending on what you actually did or certain requirements from your employer it might have made you a W-2 employee.

If you were improperly classified the employer owes back taxes, medicare, social security and a whole range of other payments to you and to the state and federal government. If this is the case make a call to the IRS they love hearing stories like these, they will send the Uncle Sam team out to help get some clarification on the matter.

MalcolmDiggs• 12 years ago

Do you plan on suing the company or the person behind it? Make sure you've got your jurisdictions right before you spend money on an attorney in that state. Also review your employment contract / agreement for clauses related to arbitration, venue, etc.

makeluvnotwar6• 12 years ago

Yes, we're looking into that. Agreement says that its regulated by Delaware law and hearings should be done there.

techjuice2• 12 years ago

Just as future advice from personal experience, if your employer misses a payment pack up and leave. Payroll is supposed to come first and all business owners know in advance if they will not be able to make the next payroll. Honest business owners will cut staff (paying paychecks in full) then close up shop as a last effort before they send out bouncy rubber paychecks and try to string along staff.

The longer you wait around to get paid, the more time and money you end up wasting where you could be working somewhere else getting paid. If you want to attempt to recoup your losses I would recommend contacting and speaking with a lawyer as soon as possible. You can try findlaw or the findlawyers website for a Delaware lawyer or you may even be able to talk to one in your local area. If possible,normally filing a class action lawsuit along with criminal charges for unpaid wages, wire fraud, etc can be helpful, depending on what your lawyer tells you are viable options.

If there are serious criminal issues, you may be able to get the FBI to assist you if the criminal issues become federal.

makeluvnotwar6• 12 years ago

Thank you!

ahazred8ta• 12 years ago

Telephone numbers for Delaware Office of Labor Law Enforcement -- they should be able to refer you to the appropriate people. http://dia.delawareworks.com/labor-law/

"fake payment references" -- Those are "materially false statements regarding payments" and should be sent to the fraud office of the bank.

makeluvnotwar6• 12 years ago

Thanks for pointing that, this can help.

NinjaTime• 12 years ago

Your money is gone. How much are you owed? The lawyer is going to take 70% of that. Move on and now you are more the wiser.

makeluvnotwar6• 12 years ago

Around 40k. I'd be happy to give that money to lawyer if he's going to be punished. It's not only about money, it's about time wasted :/.

devanti• 12 years ago

unfortunately a ton more time will be "wasted" dealing with this ..

trcollinson• 12 years ago

One thing to keep in mind is that a number of businesses incorporate in Delaware because Delaware law is very protective of owners and their privacy. The corporate veil, as it is called, is very strong in Delaware. For example, in Delaware you are not required to disclose who your corporate officers and directors are. They believe in litigating in front of a judge instead of a jury. They also believe corporate law should follow precedence over litigation.

My point being, you probably won't actually find a lawyer who will take your case. My non-legal, just a guy on HN, opinion is to cut your loss and move on. I'm sorry to hear about this level of dishonesty in a business, but don't throw good money after bad.

makeluvnotwar6• 12 years ago

For a moment I decided to move on. Now I got know that some team members now face same issue.

Company still operates and continues "product development" with rest of dedicated team.

Ask HN: Got scammed by startup company, how to find a Delaware lawyer?

Related Stories