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Leasing Companies to Appeal Texas Judgment NorVergence Leases April 29 th , Harris County, Texas Judge Brent Gamble ruled that “All Equipment Rental Agreements or other contracts procured between NORVERGENCE and Texas consumers or between finance companies and Texas consumers as a result of a NORVERGENCE solicitation directed to any Texas consumer are the result of deceptive and unfair practices and fraud on the part of NORVERGENCE and, therefore, are declared void ‘ab initio' and are unenforceable.” The default was entered against NorVergence because they did not show up in court: “The Defendant, although having been duly and legally citied to appear and answer, failed to appear and answer, and wholly made default.” When asked what the next step might be, including punitive damages, and money returned to lessees, a spokesman for the Texas Attorney General's office said, “ NorVergence is in bankruptcy,” evidently meaning any other actions or decisions would be directed to the bankruptcy proceedings. It is reported that the ruling is in the process of being appealed as it was based on the defendant not being able to appear as they are in bankruptcy proceedings in New Jersey. In addition, the leasing companies may claim the signers and guarantors of the contracts, to be liable for co-conspiracy with NorVergence to defraud the leasing companies by not disclosing service being covered in the “Equipment Rental Agreements.” On the other hand, many Texas NorVergence lessees believe their leasing company now can be sued in Texas for damages and return of lease payments made.
Texas Attorney General Greg Abbott On November 17, 2004 Texas Attorney General Greg Abbott sued bankrupt telecommunications reseller NorVergence of New Jersey for allegedly engaging in a scheme to defraud hundreds of Texas small businesses. The Attorney General also demanded that “19 finance companies holding rental agreements for now worthless equipment stop attempting to collect millions of dollars from Texas small business owners who signed up for NorVergence's services.” Attorney General Abbott's civil investigative demands and lawsuit were brought under authority of the Texas Deceptive Trade Practices Act, which permits the office to seek restitution for consumers, injunctive relief, attorneys' fees and penalties of up to $20,000 per violation. The bankruptcy is under the charge of Chief Judge Rosemary Gambardella. There most likely will not will be another meeting of all creditors. Here are the latest listings from Pacer Law Report: “Hearing Rescheduled from 4/25/05. (related document:745 Objection filed by Creditor John P. O'Hare) Hearing scheduled for 5/9/2005 at 10:00 AM at RG - Courtroom 3E, Newark. (car, ) (Entered: 04/26/2005)” Here is a copy of Judge Gamble's judgment: |
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