Chapter 64: All Hell Broke Loose!

June 8, 1995, Chicago, Illinois

“That was fast,” I said.

“They have to act fast,” Jamie said. “They can’t afford to let this go.”

“I didn’t know you could type up a filing that quickly!”

“You’d be amazed what you can do if you’re motivated enough.”

“So, what do we do?”

“Sit tight for now. How many of your offers were accepted?”

“Two of the developers, the ones we really wanted, the support rep, and three sales reps. The cease and desist can’t be retroactive, can it?”

“No. You made those offers, and the people resigned, before we received the cease and desist notice for hiring their staff. That was a VERY slick move you made. And there’s no need to fight the cease and desist unless you plan to recruit others.”

“I don’t, but I won’t be surprised if someone calls me.”

“I’d strongly advise you decline to speak to anyone from Lone Star until further notice. Ask Lucas to simply take messages and not put the calls through.”

“Will do. What about the ‘cease and desist’ about going after their customers?”

“It’s tricky. They claimed you gained inside information during due diligence. But they breached the agreement, so in theory, the contract holds you harmless. But that’s up to the courts. What I’d say is let the customers come to you. If you just put out press releases or run ads there can’t be any real issue. They can squawk a lot, but in the end, they can’t prevent you from competing on the open market. Just be careful with your ad copy. I’m sure Cindi knows. I also believe you would be safe in contacting any Lone Star client with whom you had contact with prior to the date the letter of intent was signed. I know you have the records to prove that.”

“OK. That gives us a good start. And we’ll have the information in our records to prove it all. What about the lawsuit?”

“It has quite a few moving parts. First, they argue the sale was fraudulent. That claim is purely against DCP. Second, they argue conspiracy to commit fraud, and that claim is against both NIKA and DCP. Third, they challenge the copyright assignments, but they filed in state court so they’ll have to refile in federal court. Fourth they claim NIKA engaged in theft by conversion, but that’s related to the copyright so it might have to be in federal court, and might actually be a criminal claim which they aren’t entitled to make. I need to research Texas and federal law to know for sure. Case law on that is muddled and varies by state. Their proposed remedies are a set of injunctions and orders which seek to gain control of the software and copyrights and prohibit NIKA from doing anything which would take advantage of access to the software.”

“That last bit won’t hurt us. The Apple lawsuit over ‘look and feel’ ensures that. Our conversion software was written and used before the letter of intent was signed. That remedy is toothless, I think.”

“Probably, but that doesn’t mean it can’t be litigated.”

“So do nothing?”

“There are two things. First, we wait for DCP to respond. They’re the main target. If Edwards can’t prove the sale was fraudulent, the rest of the claims go away. Judicial economy argues for a single trial, but this one might have to be in parts with the same jury. Not to mention the federal claims. Our response will be to deny all claims, obviously, but it’s DCP who are on the hook here. Ten will get you one, you’re right and they’ll call and ask what it will take to get the software and copyrights back.

“The second thing we do is, in our response, move to dismiss all the claims against us for lack of standing. Edwards does not own Lone Star and is a minority shareholder. Unless the Lone Star Board of Directors authorized his suit, which I can’t imagine they did, he has no standing to sue. He can only sue the Board and DCP. Once he owns Lone Star, THEN he could bring the claims against you on behalf of Lone Star. But he personally has no standing.”

“Why not just file that motion to dismiss immediately?”

“Because you want DCP to come to you hat in hand!”

“Duh!” I laughed. “I should have thought about that. So when?”

“One of the motions was for expedited hearings because of the potential damage to Nathan Edwards and Lone Star. I suspect DCP will want to make this all go away VERY quickly. If the motion to expedite is granted, and I suspect it will be, we’ll likely need our response filed by the middle of next week. You’ll need Texas counsel. We have a firm we work with there. It would be billed through us, and both Thad and I would ask to be admitted pro hac vice.”

I chuckled, “Of course you would. That way you can bill me THREE hourly rates!”

“Just include your potential legal fees in the premium you charge DCP!”

“Nice, Jamie. Nice.”

“Do you think DCP knows they’re going to be screwed at the end of this?”

“I doubt it. If Dante executes his plan as we suspect, their investment is going to be worth pennies on the dollar. And Dante will make Nathan Edwards whole, I’m sure.”

“You would know more about that than me, but I can’t imagine he wouldn’t.”

“I’m going to do my best to get those Lone Star staffers to Chicago no later than this weekend. We’ll put them up in hotels and they can come to work on Monday. I want it to be a fait accompli.”

“I’m reasonably certain that’s safe, because they had no non-competes. The best Lone Star, or whatever is left of them could do, is sue you. And money will make that go away, as always.”

“OK. Let me make some calls. Keep me posted. Oh, and what should I do if Dante calls me?”

“Is that a SERIOUS question?”

I laughed, “You have no idea how much pleasure it would give me to rub his nose in this.”

“Don’t, Steve. You know better. Put him on the list you give Lucas.”

“Will do. Thanks, Jamie. Keep me posted.”

We said ‘goodbye’ and I hung up, then picked up the phone to call Terry.

“It’s a complete shitstorm here, Boss!” Terry said, but he was laughing.

“I can imagine. I want you to call Barney at the travel agency and have him book flights and hotels for the developers, sales rep, and support rep. I want them to be in Chicago on Monday. When they’re here, we’ll sort out the move to Colorado Springs.”

“After being in Dallas, I can safely say I’d rather be there. Does Dave know yet?”

“No. I just got off the phone with Jamie. I’m going to see Dave as soon as I call Barbara and Mario to have them do the same thing and get the reps from each office here.”

“I’ll take care of it, Boss. See you on Monday morning!”

“Thanks, Terry. You’ve done a great job!”

I hung up, then placed calls to Mario and Barbara. After I brought them up to speed on what I needed, I went down to reception to let Lucas know about any calls from the Lone Star staff or Dante. That accomplished, I went to Dave’s office to explain what had happened, and once again rocked him back in his chair. I got pushback on my plans to establish a development team in Colorado Springs, but in the end, we agreed on a way forward. He and I went to talk to Julia, where I received the same basic pushback.

“Julia, as I told Dave, I had to make these decisions myself. Most of this was part of next year’s plan; I just accelerated it and made the hiring decisions. But the two developers I hired were at the top of Dave’s list. And putting them in Colorado Springs won’t hurt anything. Nicole has worked well there.”

“But making Terry a director? Shouldn’t that have been discussed?”

“I wasn’t in a position to discuss it. This was such a mess that I had to make decisions based on information only I had and on my gut. And, if we add in the separation and pending divorce, I’m not sure what else I could have done.”

“Separation and divorce?”

“Yeah,” I sighed. “Something I couldn’t really share before. Penny and Terry are through. He was going to Dallas if things had worked the way I had thought they would. I’m sorry I stepped on your toes and violated my own policy, but I’m not sure how I could have done otherwise given the insanity.”

“I can’t believe Dante would pull this kind of thing.”

“There’s more, Julia. He formed an LLC which bought an engineering firm in Atlanta which competes with M&M. That’s a technical violation of his agreement with M&M. Melissa knows, but we’re not doing anything about it at the moment. We have to see what his plans are. That’s what happened here.”

“And we still own the Lone Star software?”

“For the moment. The brain trust at Spurgeon Capital thinks DCP will come crawling to us begging us to sell it back to them. We will, but at a premium that recoups a good portion of our costs and generates some profit for Samantha for funding the purchase.”

“I think I take back my complaint,” Julia said, shaking her head. “This is just crazy beyond belief.”

“Want the big chair back?” I grinned.

“Oh HELL no!” she laughed. “I’m surprised this hasn’t given you gray hair and ulcers.”

“It’s worse than that,” I sighed.

“What?” Julia asked worriedly.

“I like it,” I said with a sly grin.

That afternoon, after lunch, Mario, Barbara, and Terry confirmed that the travel plans were all set, with one minor glitch. Vickie had a son who she couldn’t arrange someone to watch overnight, so Terry had taken the initiative to book him a ticket as well, and arrange with the daycare co-op for him to join.

June 9, 1995, Chicago, Illinois

“Now what?” I asked.

“Lone Star filed for an emergency injunction against NIKA hiring their staff, alleging theft of intellectual property.”

“Lone Star? As in the Board?”

“Yes,” Jamie said. “It’ll be heard in the judge’s chambers this afternoon. Thad and I will attend by phone. Our colleague, Miles Parker, will attend the hearing in person.”

“Will they get it?”

“Unlikely. We’ll argue severe harm against the employees and the fact that money damages would cover any harm to Lone Star should they prove their case.”

“Jamie, I won’t sell back the software unless they drop this.”

“It’s an attempt to gain leverage on their part. They’ll file the claims for theft of intellectual property which we’ll argue should be dismissed as WE own the intellectual property. Their claim would only be ripe if Edwards wins his suit against DCP.”

I laughed hard, “That’s freakin’ perfect! They can only win if they lose!”

“You hold all the cards, Steve. Just like when we play Hold ‘Em! You’ve got the nuts and they just pushed all in thinking their two pair is good. And you sit there all smug when that happens, you sneaky bastard!”

“You could always stop playing, Jamie!” I chuckled.

“You and Terry do us the favor of not playing about a third of the time, and I win my fair share then. Playing you two bastards is good practice.”

“Terry will be in Colorado Springs permanently fairly soon.”

“Say what?!”

“He and Penny are separated and going to divorce.”

“Shit! Man, that sucks.”

“No kidding. Fortunately, it’s amicable. Do I need to attend this hearing?”

“No. Normally when the hearing is in chambers, it’s attorneys only. That’s not to say you can’t attend, but you can’t speak at all. Just let us handle it. We’ll beat the injunction and afterwards I’ll have a conversation with DCP about making it go away and getting their software back. Got a number in mind?”

I told him.

“OK,” Jamie said. “I’m guessing you won’t come down from there?”

“No. It’s the same as when we sell licenses for our legal and medical software. A fixed price. Take it or leave it. And the money has to be in escrow or in our hands before we reassign the copyrights.”

“Got it. I’ll get back to you.”

I hung up and walked to Elyse’s office, taking Kimmy with me.

“Jamie just called and said Lone Star filed for an emergency injunction against us hiring the Lone Star folks. He says it won’t succeed, and then he’s going to tell DCP our price. I told him it’s a fixed price with no negotiation. That is, after all, the only way we sell software!”

“You are loving this, aren’t you?” Elyse smirked.

“Indeed I am! Kimmy, would you work with Michelle to get office space arranged for six people for Monday? And schedule an ‘all staff’ in place of our leadership meeting.”

“Will do!”

“Lucas told me he’s had several calls from Lone Star employees,” Elyse said. “And one call from someone who claimed to be a reporter in Dallas.”

“We can’t say anything just yet,” I said. “I asked Cindi to hold off on speaking to the Press until Monday. We need to see how things go. Technically, the deal was supposed to occur today. Monday we have to make an announcement. I’m surprised it hasn’t leaked.”

“And the reporter’s call?”

“I’m not too concerned about it running in the Dallas paper tomorrow. If it does, I’m sure Stan Jakes will call me. He has my cell phone, and the business reporters know he has it. Now, I need to tell you two something in EXTREME confidence, but we need Zeke up here as well.”

Elyse dialed Zeke’s number and asked him to come up. He arrived a minute later.

“Do I get to know what’s going on?” he asked lightheartedly.

“Yes, but not with the Lone Star thing. At least not yet. All three of you need to promise me that not a WORD of what I’m about to tell you is spoken outside this office, that nothing is written down, and you don’t even discuss it amongst yourselves without me present.”

“Why do I suddenly feel I need to go to Cindi’s office and get her bottle of Jack?” Elyse sighed.

“You’ll need more than a bottle for this one,” I said. “Next Monday, June 12th, the FBI is going to execute a full-scale raid on Hart-Lincoln. We’re going to provide IT assistance.”

“We did this once,” Zeke said.

“This is different. This isn’t just John Lentz. This is the entire firm.”

“How do YOU know this?” Elyse asked.

“I brokered the deal.”

“Deal?”

“Lisa Glass had her sentence commuted in exchange for rolling over on Hart-Lincoln, which is an Outfit firm.”

“Holy shit!” Zeke gasped. “Seriously?”

“Yes.”

“Now I know where you went those days you disappeared,” Elyse said. “You went to Logan to see Lisa, didn’t you?”

“Yes. She’s being watched by the Marshals Service. They’ll release her to her dad on Monday afternoon. She has one year of parole, but after that, she’s a completely free woman. One with a felony murder conviction, but I’m guessing Alec can find something productive for her to do which doesn’t need a securities or real estate license.”

“How the fuck?”

“You know I have contacts with the FBI. They asked me to talk to her. Alec didn’t know until she was moved out of Logan. The US Attorney let me tell him so he didn’t try to go visit her.”

“So what do we need to do?”

“First thing on Monday I need you, Zeke, to be at the FBI offices in the federal building. I’ll meet you there just before 7:00am. We’ll be briefed, and I’ll come back here while you go with them. They’re going to confiscate everything this time. Your job is to make sure all the computers are safely shut down so they can be taken to wherever the FBI is going to work on their systems. You’ll help make sure everything is set up again, and then we’ll start dumping data. I’m not sure if this is a ‘special master’ situation or not, but the FBI will tell us.”

“Damn,” Zeke said.

“Yeah. If you need help, you can call Kimmy and she’ll ensure someone gets sent over. I’m going to be up to my eyeballs in Lone Star stuff.”

“Uhm, weren’t you supposed to be in Dallas today to sign the deal?”

“I was, but there was a complication. I’ll announce it to everyone on Monday. I’m sorry I can’t say anything more today.”

“Oh, right,” Zeke replied with a wry smile. “You can tell me about a super-secret FBI raid on a Mafia law firm, but not about NIKA buying Lone Star?”

“As dumb as that sounds, it’s true. Sorry.”

“Well, one thing is for sure, it’s never boring around here!”

“Remember, not a word. If Tasha asks, tell her you’re meeting me and I didn’t provide any details. I’m sorry for asking you to lie, but in this case, I don’t have permission to tell anyone except the three of you. And I only got THAT because of the other thing I can’t talk about.”

“OK,” Zeke said. “See you at the Dirksen building a few minutes before 7:00am.”

He left and shut the door behind him.

“Thanks Kimmy,” I said. “If he needs help on Monday, send Eve Dunham or Sam. Your call. Just let Cindi or Julia know it’s a government request.”

“Will do!”

She left and shut the door behind her.

“Lisa Glass?” Elyse spat. “Seriously? After everything she did?”

“You want I should tell the FBI about OTHER stuff instead?” I asked with an arched eyebrow.

“Uh, no. But they’re a big customer.”

“And my alternative when the FBI comes asking for specific help they know I can provide?”

“What did YOU offer Lisa?”

I smiled, “That Melanie and I would make sure she had an ironclad commutation. She gets out. She did offer what you’re suggesting. I said ‘no’. She wasn’t surprised by my refusal.”

“And Samantha?”

“She’ll know Lisa got out, but Lisa promised not to say I was involved. And I believe her, given what I’ve done for her.”

“Unreal. All this amidst the Lone Star stuff.”

“Yeah.”

“Can any of this be traced back to you?”

“That’s the beauty of it - Hart-Lincoln is a customer and we helped with the previous search warrant. So they trace it to me and I have an obvious thing to point to. There was no fallout last time. We simply helped the FBI with our software and computers we maintained.”

“When did you find out about the raid?”

“They called me last night on my mobile phone. I had warned them about possibly being in Dallas, so that’s why I had a bit more advance notice, and got permission to tell you three, by name.”