ArsDigita: From Start-Up to Bust-Up (or the story of the fall of Icarus) - Part III
This is the end of the story about the last months of life ArsDigita ( 1st part , 2nd part ). As it was said in previous parts, after attracting funding from venture capital firms, there were changes in the company's management, which led to a significant deterioration in business. Attempts to resolve the conflict peacefully did not lead to results, and then the shareholders tried to resolve the issue by general voting and re-election of the Board of Directors.
On April 11, 2001, the following lawsuit was filed in Delaware court:
')
As you can see from the above excerpt, the lawsuit was filed by Allen, Ern,
venture capitalists and the corporation itself. We were very puzzled by the form
filing this lawsuit, because the basis of his dispute between two groups of shareholders (VI
against the founders). Therefore, we did not expect the corporation to have the same
interest in this lawsuit.
My conversation with third-party legal adviser ArsDigita, Jay Hachigian (Jay
Hachigian) from the law firm Gunderson shed some light on how it
turned out to be possible. It looks like Allen ran his hand deeper into his pockets.
corporations and scraped up a quarter of a million dollars to pay for lawyers,
working for venture capitalists. Jay warned them that it is not very
right approach, but did not listen to him and did just that. And before us
a miraculous picture was formed in which a group of shareholders is trying to achieve
greater accountability and responsibility from the management team, not particularly
well, in their (shareholders) opinion doing their work. In response to this,
managers, seeking to avoid this accountability and responsibility, are suing
these same shareholders. Moreover, all legal fees and attorney fees
made out of the purse of those same shareholders!
The essence of the claim was that Gene and I signed a number of agreements on
which have undertaken certain obligations, n. always vote on
meetings of the Board of Directors as well as representatives of Greylock and General
Atlantic. The investment agreement of the VI, which we
signed was thicker than the telephone directory of the Yellow Pages of Manhattan
(comment of the translator: if to trust Google, then it is about 6-7 cm). And obviously
somewhere there, in the depths of this pile of papers contained a clause that the Council
Directors ArsDigita will not change the provisions of the charter without the consent of
IN AND. But it never said there that the shareholders could not do it. Greylock and
General Atlantic would like the court to interpret these documents more widely. If a
memory serves me well, these documents were prepared by Paul Weiss (Paul
Weiss) (paulweiss.com), General Atlantic attorney. And according to
generally accepted legal norms, this means that this kind of discrepancies
should not be interpreted in their favor ( approx. translator: the idea is that once
the claimant himself prepared the documents, he cannot insist on a broader
interpretation). Of course, I am not a lawyer and predict another person’s actions.
In this case, the Delaware judge, hardly anyone will take. Personally, I would be very
shocked if the court would sentence in favor of greylock and general
Atlantic. Such a decision would reduce the will and decision of shareholders to zero,
those. in other words, the decision of the judge would mean that venture capital firms have
total control, as if their investments in us provided them with ordinary voices
shares ( translator's note: as a rule, venture capital firms receive
preferred stock, not ordinary stock. This gives them the right to “first piece
pie, as mentioned above, but does not give a real voice, as
shareholder. Alternatively, a VI can receive ordinary stock, but it’s definitely
not a controlling or even blocking package.).
Here it is a story as it is. Of course, much of the writing above, rather
all, the results of the claim will not be relevant. Courts do not usually decide
which group is most capable of making the right decisions. The court is considering
such questions as “What are the rights of the majority of the company's shareholders in the matter
decision making? ”or“ Can a VI add restrictions to
agreements signed over a year ago and compiled by their own
lawyers? "
The process of judicial investigation and collection of testimony will take a couple of months. Then
will be the court itself, most likely somewhere in June 2001, in the courtroom, in
Delaware. A judge can make a decision based on just a few documents.
which means that most of the time and money spent during the collection
The readings will be spent empty.
As a rule, people try to talk as little as possible during court proceedings.
proceedings. But I was more and more annoyed by the comments that
did different people regarding this claim. ArsDigita management was worn around
the building and told everyone that "Philip sued us in court," complete nonsense. Allen,
who tells everyone that “VI has a very strong, winning position” (and why then
you had to pay $ 250,000 owned by shareholders to beat a couple
man, if the position is really strong?). Reporters who showed it
everything is in this light, as if this story of the struggle of egoism and the lust for power. AT
in a sense, they are right. Allen, Chip and Peter definitely didn’t like it,
that they were exposed as fools, whose ignorance cost the company
$ million. But with respect to Jin and me, this view is incorrect. We were happy
would be passive shareholders in a profitable company. But we didn’t want to be
passive shareholders in a company that is constantly losing profits.
There were a number of practical considerations that motivated me to write this
articles. One of the great sides of Webb is that there is no more
need to repeat the same thing several times. Every day i get
about 50 letters from photo.net and philip.greenspun.com readers with a variety of
questions. Several times a week, reporters call or write to me. Since
Greylock and General Atlantic filed a lawsuit, the usual flow of questions about art
photography or programming has been put down by a flood of lawsuit questions. If a
If I hadn’t written this article, I’d have long earned myself arthritis of the hands
just sending “no comments” 200 times a day.
And finally, there are customers who use the ArsDigita Community System, there are
our friends we recruited at ArsDigita. They all have the right to know
what is happening is not from an article in a 500-word newspaper and not from a corporate
press release. The birth and development of the company were open to the general public, its
the story was documented in chapter 2 of the book
Philip and Alex's Guide to Web Publishing . Those who have found the strength and means
support us in due time have every right to know how this ended
story.
Copyright 2001 Philip Greenspun
The place where the original of this story was previously available is on Philip's website.
Greenspana, now decorates the text as follows:
What sounds premerno in Russian like this:
The company did not last long after the departure of Philip. Someone says that many
the problems she encountered were not caused only by the VI , that Philip himself
was far from modesty and humility. But be that as it may, in my opinion the story
This is very indicative and very useful both to those who “work for the uncle” and
those who build their business.
April 2001: Allen and Venture Capitalists sue
On April 11, 2001, the following lawsuit was filed in Delaware court:
')
ALLEN SHAHEEN, ERNEST)
BLACKWELDER, GENERAL ATLANTIC)
PARTNERS 64, LP, a Delaware)
limited partnership, GREYLOCK)
X LIMITED PARTNERSHIP, a)
Delaware limited partnership)
and ARSDIGITA CORPORATION,)
a Delaware corporation,)
)
Plaintiffs,)
)
v. ) Civil Action No. 18821
)
PHILIP GREENSPUN, EVE A.)
ANDERSSON and TRACY E. ADAMS)
)
Defendants. )
As you can see from the above excerpt, the lawsuit was filed by Allen, Ern,
venture capitalists and the corporation itself. We were very puzzled by the form
filing this lawsuit, because the basis of his dispute between two groups of shareholders (VI
against the founders). Therefore, we did not expect the corporation to have the same
interest in this lawsuit.
My conversation with third-party legal adviser ArsDigita, Jay Hachigian (Jay
Hachigian) from the law firm Gunderson shed some light on how it
turned out to be possible. It looks like Allen ran his hand deeper into his pockets.
corporations and scraped up a quarter of a million dollars to pay for lawyers,
working for venture capitalists. Jay warned them that it is not very
right approach, but did not listen to him and did just that. And before us
a miraculous picture was formed in which a group of shareholders is trying to achieve
greater accountability and responsibility from the management team, not particularly
well, in their (shareholders) opinion doing their work. In response to this,
managers, seeking to avoid this accountability and responsibility, are suing
these same shareholders. Moreover, all legal fees and attorney fees
made out of the purse of those same shareholders!
The essence of the claim was that Gene and I signed a number of agreements on
which have undertaken certain obligations, n. always vote on
meetings of the Board of Directors as well as representatives of Greylock and General
Atlantic. The investment agreement of the VI, which we
signed was thicker than the telephone directory of the Yellow Pages of Manhattan
(comment of the translator: if to trust Google, then it is about 6-7 cm). And obviously
somewhere there, in the depths of this pile of papers contained a clause that the Council
Directors ArsDigita will not change the provisions of the charter without the consent of
IN AND. But it never said there that the shareholders could not do it. Greylock and
General Atlantic would like the court to interpret these documents more widely. If a
memory serves me well, these documents were prepared by Paul Weiss (Paul
Weiss) (paulweiss.com), General Atlantic attorney. And according to
generally accepted legal norms, this means that this kind of discrepancies
should not be interpreted in their favor ( approx. translator: the idea is that once
the claimant himself prepared the documents, he cannot insist on a broader
interpretation). Of course, I am not a lawyer and predict another person’s actions.
In this case, the Delaware judge, hardly anyone will take. Personally, I would be very
shocked if the court would sentence in favor of greylock and general
Atlantic. Such a decision would reduce the will and decision of shareholders to zero,
those. in other words, the decision of the judge would mean that venture capital firms have
total control, as if their investments in us provided them with ordinary voices
shares ( translator's note: as a rule, venture capital firms receive
preferred stock, not ordinary stock. This gives them the right to “first piece
pie, as mentioned above, but does not give a real voice, as
shareholder. Alternatively, a VI can receive ordinary stock, but it’s definitely
not a controlling or even blocking package.).
Here it is a story as it is. Of course, much of the writing above, rather
all, the results of the claim will not be relevant. Courts do not usually decide
which group is most capable of making the right decisions. The court is considering
such questions as “What are the rights of the majority of the company's shareholders in the matter
decision making? ”or“ Can a VI add restrictions to
agreements signed over a year ago and compiled by their own
lawyers? "
The process of judicial investigation and collection of testimony will take a couple of months. Then
will be the court itself, most likely somewhere in June 2001, in the courtroom, in
Delaware. A judge can make a decision based on just a few documents.
which means that most of the time and money spent during the collection
The readings will be spent empty.
Why did I write this
As a rule, people try to talk as little as possible during court proceedings.
proceedings. But I was more and more annoyed by the comments that
did different people regarding this claim. ArsDigita management was worn around
the building and told everyone that "Philip sued us in court," complete nonsense. Allen,
who tells everyone that “VI has a very strong, winning position” (and why then
you had to pay $ 250,000 owned by shareholders to beat a couple
man, if the position is really strong?). Reporters who showed it
everything is in this light, as if this story of the struggle of egoism and the lust for power. AT
in a sense, they are right. Allen, Chip and Peter definitely didn’t like it,
that they were exposed as fools, whose ignorance cost the company
$ million. But with respect to Jin and me, this view is incorrect. We were happy
would be passive shareholders in a profitable company. But we didn’t want to be
passive shareholders in a company that is constantly losing profits.
There were a number of practical considerations that motivated me to write this
articles. One of the great sides of Webb is that there is no more
need to repeat the same thing several times. Every day i get
about 50 letters from photo.net and philip.greenspun.com readers with a variety of
questions. Several times a week, reporters call or write to me. Since
Greylock and General Atlantic filed a lawsuit, the usual flow of questions about art
photography or programming has been put down by a flood of lawsuit questions. If a
If I hadn’t written this article, I’d have long earned myself arthritis of the hands
just sending “no comments” 200 times a day.
And finally, there are customers who use the ArsDigita Community System, there are
our friends we recruited at ArsDigita. They all have the right to know
what is happening is not from an article in a 500-word newspaper and not from a corporate
press release. The birth and development of the company were open to the general public, its
the story was documented in chapter 2 of the book
Philip and Alex's Guide to Web Publishing . Those who have found the strength and means
support us in due time have every right to know how this ended
story.
Related Links
- http://unicast.org/arsdigita/ full text of the claim and documents provided
to the court. - Greylock corporate site: http://www.greylock.com/
- Corporate site of General Atlantic: http://www.gapartners.com/
- "Cold House" by Charles Dickens: Project Gutenberg | Amazon | lib.ru (added during translation)
Copyright 2001 Philip Greenspun
Epilogue (from translator)
The place where the original of this story was previously available is on Philip's website.
Greenspana, now decorates the text as follows:
ArsDigita Corporation and Philip Greenspun have amicably settled all of
their disputes to the mutual interests of the parties involved. As a
result of the settlement, Greenspun has resigned from ArsDigita's Board of
Directors and will exercise no ongoing management or stockholder
control. The Company and Greenspun have entered into a confidentiality
agreement
What sounds premerno in Russian like this:
ArsDigita and Philip Greenspan are fully and mutually beneficial.
all questions and disagreements. Under the terms of this agreement, Greenspan resigned.
from the Board of Directors of ArsDigita and will no longer participate in
management, nor use your shareholder rights. The company and Greenspan are also
signed a nondisclosure agreement.
The company did not last long after the departure of Philip. Someone says that many
the problems she encountered were not caused only by the VI , that Philip himself
was far from modesty and humility. But be that as it may, in my opinion the story
This is very indicative and very useful both to those who “work for the uncle” and
those who build their business.
Source: https://habr.com/ru/post/24856/
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