NorVergence Mess Not Going Away, Perhaps Criminal Action

by Christopher Menkin

Attorneys for NorVergence lessors believe the FTC is solely centering on “forced insurance,” or will be deterred by attorney general settlements in many states. Others believe specific believe the state's top cops have moved onto other cases and have too large a load to keeping working on the leasing company-telecom fiasco.

Here is a recent judgment, adding to others, showing the continued loss of venue in pursuing remedy, and considered public information as it is being spread over the internet:

This letter is making the internet rounds, therefore public information:

http://leasingnews.org/PDF/IFC-Illinois_3-4--05.pdf

Here is one attorney letter regarding CCL and their position on the loss of momentum of the various attorneys generals and FTC ( it definitely is worth reading and then “the other side” follows it) :

http://leasingnews.org/PDF/CCLattorneys.pdf

“Here is a synopsis of the CCL name debacle.

“Commerce Bank apparently saw NorVergence as a potential customer and wanted to accommodate NorVergence's request for participation as a leasing company, through its subsidiary, Commerce Commercial Leasing, LLC, a New Jersey limited liability company. Commerce Bank and CCL do not directly handle what they refer to as small leases.

“Partners Equity Capital Company, LLC, a Pennsylvania limited liability

company proposed to CCL that it would handle the leases referred from Commerce Bank, and pay Commerce Bank a fee for doing so. For whatever reason they thought to be to their best interest, Commerce Bank and CCL appointed PECC the agent of CCL to handle the leases.

“The written agreement among Commerce Bank, CCL and PECC, provides that upon PECC signing a Vendor Program Agreement in the name of CCL, all right, title and interest in the Vendor Program Agreement is immediately assigned to PECC without further action of any party. NorVergence signed a Vendor Program Agreement with "Commerce Commercial Leasing VendorLease" (CCL VL) which warranted to NorVergence that it was a duly created and existing limited liability company (which it was not and never has been). One of PECC's officers signed the document on behalf of CCL VL.

Based upon the two documents operating together, each lease that was entered into between NV and its customer which was then assigned to CCL automatically became the property of PECC when the lease was signed, and the Matrix box became owned by PECC when the lease was funded (even though the invoice from NV was addressed to Commerce Bank).

“The CB, CCL and PECC contract required that all collection activity be done in the name of CCL. I have removed one of the cases I am defending to federal district court. The federal rules (and most state rules of procedure are patterned after them) provide that each suit must be brought in the name of the real party in interest. This procedural requirement takes precedence over an ill-conceived contractual provision whereby PECC believed it had to sue in the name of CCL. (Of course, suing in the name of CCL does not mean that all of PECC's attributes---specifically, its principal place of business is substituted in place of those of CCL.)

“CCL VL was never created; PECC never registered the fictitious name of CCL, LLC, in PA, and CCL, LLC, the NJ LLC is now authorized to do business in PA, so PECC can not now register it as a fictitious name.

“In my opinion, all suits brought in the name of CCL must be dismissed for violation of the real-party-in-interest rule, and the suits, if refilled, will have to be refilled in either NJ or in the state where the lessee resides or has its principal place of business.

“In short, neither Commerce Bank nor CCL have any interest in these leases which can be enforced in law given the provisions of the contracts that I have read.

“Ronald P. Gossett
rongossett@gossettlaw.com
“Gossett & Gossett, P.A.
Building I
4700 Sheridan Street
Hollywood, FL 33021
(954) 983-2828”

None of the companies mentioned would return our telephone calls, and Leasing News welcomes any comment they may wish to make.

In addition, Leasing News is seeking an interview with Randy Brooks, lead Federal Trade Commission attorney in the NorVergence litigation. Many readers may remember he was also the lead FTC attorney who secured a judgment against Leasecomm/Microfinancial.

Some of the comments may center on:

By furnishing third-party finance companies with rental agreements that may allow the finance companies to:
a. Misrepresent that consumers owe money regardless of
whether NorVergence provides the promised telecommunications services; and
b. File collection suits in distant forums, NorVergence provided others with the means and instrumentalities for the commission of deceptive or unfair acts or practices.

In addition, as we the FTC finds additional issues during the course of their action, are they going to actively pursue those issues as well.

Will there be any criminal charges made against individuals for their role in any of the actions that violate the law?