How do we get supplier to pay for returned stocks

[Eddy Tan]

It has been more than 3 years now. We tried all the ways within our means and still no result.

In July 2005, WebTrends Inc asked for our stocks of their products to be returned immediately when they terminated our distribution agreement. We not only returned the stocks but also paid for all outstanding invoices. [The termination was not due to sales performance. We over achieved in 2004 . Fact is that they recruited our channel partner.]

For the next 6 months, we wrote to different people at Webtrends asking after the payment. No one replied. We wrote letters to the CEO and owner of Webtrends and sent by registered mails. No one replied.

In Aug 2006, we engaged the local office of Dun & BradStreet. They asked for an initial fee for the court hearing in 2006. The case dragged on and upon my writing to the US head office on the delay in 2008, the local office wrote in to terminate their services and returned the money. No reply came from their head office. We insisted that they continued since they asked for the money and accepted it. They refused. I was very disappointed but was also very angry at oursleves for being a small guy. We lost two years!

While D & B was communicating with WebTrends legal folks, WebTrends maintained that under the agreement they had a right not to re-purchase stocks. True. Why did they ask for the stocks then? Why no one responded in the first 6 months and say so? Return us the stocks and we could have sold them off. Is it not a fact that their rights to refuse re-purchase has lapsed long ago? If yes, why dont they pay up. I can only think of one reason. They know we are a small company. We dont have the financial muscle.

We are now into another round with another debt collection company. We have been invoicing them using registered mails.

My fear is that there is a limited time period for all civil cases. Engage a lwayer to expedite?
It is not within our means. We are a small comapny located in Singapore.

Can someone please advise on what we can do to convince them to pay up? Is there any US govt agency that we can approach? Any useful forum to solicit help?

Thank you.

[cw1865]

Webtrends
San Bruno Office

1111 Bayhill Drive
Suite 440
San Bruno, CA 94066

Is that the address?

San Bruno is in San Mateo County, California

Right now people are hungry for work. You need to find a small practitioner located in San Mateo County, California willing to take the case on a contingency basis.

Usually the statute of limitations for contract actions is six years, but that can differ based on the state.....

[Martinscholes]

In the UK a Statute of Limitations can be ignored by a court, if the court believes the delay was caused on purpose by one of the parties.

And if you can't get them on one law, see if you can get them on another.

[SnerdeyWebs]

Yeah, catch one of those hungry ones, but not too hungry as they will rush and overlook too much. They have to dig in deep and find the shinny bars of gold ;)

Of course it would just be so much easier if they would just comply. Sucks to see this but many just are now using the ropes to hang on...

[Dinghus]

It is my mantra to all small business people, get PrePaid Legal (http://www.prepaidlegal.com/hub/donaldhammond). They are in 49 of the 50 states (not in Alaska) and in Canada. The best thing is they will walk you through the process of collection at no charge to you. If you want them to do it, they will do it at a reduced rate. You get court time included in your low fees.

One thing I have found invaluable is that the local law office can connect me with one in another state to deal with legal matters there.

This may sound like a sales pitch, but believe me, I use them (maybe abuse them) all the time. They review contracts for me (no charge for like 3 a month or something like that), write letters to derilect customers (no charge) and have made phone calls even (no charge). Most important, they know what I have to do and how I have to do it. And you are NOT a "little guy" with them.

Seriously, check them out. PrePaid Legal (http://www.prepaidlegal.com/hub/donaldhammond). You will save a lot of time and effort, believe me. Contact me if you have questions.

[clumberman]

It has been more than 3 years now. We tried all the ways within our means and still no result.

In July 2005, WebTrends Inc asked for our stocks of their products to be returned immediately when they terminated our distribution agreement. We not only returned the stocks but also paid for all outstanding invoices. [The termination was not due to sales performance. We over achieved in 2004 . Fact is that they recruited our channel partner.]

For the next 6 months, we wrote to different people at Webtrends asking after the payment. No one replied. We wrote letters to the CEO and owner of Webtrends and sent by registered mails. No one replied.

In Aug 2006, we engaged the local office of Dun & BradStreet. They asked for an initial fee for the court hearing in 2006. The case dragged on and upon my writing to the US head office on the delay in 2008, the local office wrote in to terminate their services and returned the money. No reply came from their head office. We insisted that they continued since they asked for the money and accepted it. They refused. I was very disappointed but was also very angry at oursleves for being a small guy. We lost two years!

While D & B was communicating with WebTrends legal folks, WebTrends maintained that under the agreement they had a right not to re-purchase stocks. True. Why did they ask for the stocks then? Why no one responded in the first 6 months and say so? Return us the stocks and we could have sold them off. Is it not a fact that their rights to refuse re-purchase has lapsed long ago? If yes, why dont they pay up. I can only think of one reason. They know we are a small company. We dont have the financial muscle.

We are now into another round with another debt collection company. We have been invoicing them using registered mails.

My fear is that there is a limited time period for all civil cases. Engage a lwayer to expedite?
It is not within our means. We are a small comapny located in Singapore.

Can someone please advise on what we can do to convince them to pay up? Is there any US govt agency that we can approach? Any useful forum to solicit help?

Thank you.

While I am no way a fan of the Kaliforia Attorney General, they may have a consumer fraud division and I would try contacting them. Contact the Better Business Bureau and find out if WebTrends is a member; file a complaint if they are. There is a Singapore Consulate in San Francisco; see if they might help, too. Hit them from several different angles and something might give. Just some quick thoughts...

Lyle

[subsystems]

Is it me or is it hard to figure out what is going on? I'm lost.

Are we talking about Webtrends Inc that does website traffic analytics?
WebTrends - Wikipedia, the free encyclopedia (http://en.wikipedia.org/wiki/Webtrends)
Wikipedia says they are "a private company headquartered in Portland, Oregon."

Let me get this straight based on what you've told us so far...

"In July 2005, WebTrends Inc asked for our stocks of their products to be returned immediately when they terminated our distribution agreement. We not only returned the stocks but also paid for all outstanding invoices."

Ok so your company was distributing products for WebTrends, Inc. The arrangement sounds like they sent you products and you would pay them for any that were sold. They terminated the agreement and you returned the unsold products. You also paid for the products that were sold at that time.

It sounds like that should have been the end of it.

"For the next 6 months, we wrote to different people at Webtrends asking after the payment. No one replied. We wrote letters to the CEO and owner of Webtrends and sent by registered mails. No one replied."

Why are they obligated to reply? You returned the product and paid the outstanding invoices. The agreement was over and all product and invoices were taken care of.

"In Aug 2006, we engaged the local office of Dun & BradStreet. They asked for an initial fee for the court hearing in 2006. The case dragged on and upon my writing to the US head office on the delay in 2008, the local office wrote in to terminate their services and returned the money. No reply came from their head office. We insisted that they continued since they asked for the money and accepted it. They refused. I was very disappointed but was also very angry at ourselves for being a small guy. We lost two years!"

Ok so you paid the local office of Dun & BradStreet to help you with your case against WebTrends Inc. While in the process the local Dun & BradStreet terminated there services with Dun & BradStreet headquarters. Who returned the money to whom? If they send your payment to headquarters I can see you have a problem. If they returned it to you, I don't see the problem.

"While D & B was communicating with WebTrends legal folks, WebTrends maintained that under the agreement they had a right not to re-purchase stocks. True. Why did they ask for the stocks then? Why no one responded in the first 6 months and say so? Return us the stocks and we could have sold them off. Is it not a fact that their rights to refuse re-purchase has lapsed long ago? If yes, why don't they pay up."

This is where you lose me. Why would WebTrends Inc be purchasing products from you? Weren't you the distributor of their products? Wasn't that product returned to them by you? You said they wanted the product back because they wanted to use a different channel partner. They are within their rights to switch distributors.

Correct me if I'm wrong here, but it sounds like you made a distribution arrangement with WebTrends and were selling their products which you were allowed to stock at your location free of charge. They terminated the arrangement and wanted their product back. You sent it back and paid for the product you sold. This must have been making money for you because you wanted to continue to sell their products. They didn't want to continue with that arrangement.

Deal is over move on. I don't know why you think you need to pursue anything legally. You can't force people to let you distribute their products just because you want to do it. Ok you lost 2 years. Sounds like your fault, they were done and have no obligation to even talk with you anymore.
Sounds like sour grapes on your part.

I can see one other possible reason you could think you are due anything. If the distribution arrangement was that you pay for the stock that you had in your possession, sold or not. You sent it back to them without being reimbursed. Reread your distribution arrangements. You may have sent them stock that you owned. You may have assumed they would pay you for it but that agreement sounds like it was never made. You just gave them the stock out of ignorance. Now you are fighting to get it back so you can sell it. But they don't want you to. They got free stock and with the other channel partner they are selling it. Good deal for them, pretty foolish on your part.

Look, if I buy a car (model 75b) from a dealer and pay for it up front. Then they ask me to return it because they have someone that wants to buy a model 75b. I don't have to return it because I own it. But if I do then I must work out an agreement as to what they are going to pay me for it. The first transaction of me buying the car is over with. If I deliver it without that agreement and hand them the pink-slip signed, they own it at that point and never agreed to pay for it. My loss for being foolish.

I realize software is something you lease and don't own but the idea is the same. If your company bought product to distribute and paid for it, then you gave it back for no reason without an agreement to be paid.

So the two senarios are...
1. You bought product and gave it back without a payment agreement.
2. You returned unpaid for product.

Case 1. The deal is over with. Get any money owed to you by D&B and move on. Good luck with that because they can easily produce billing records that cover their time spent whether they actually did or not.
Case 2. Big mistake on your part for returning product without an agreement to get paid. Not sure what you can do about it now. That arrangement needed to be made before product was returned.

[Eddy Tan]

Thank you guys for offering information and suggestions.

Honestly, you guys give me hope....after struggling for 3 years quietly. Thank you. Thanks alot!

To Dinghus:

Thank you for the suggestion. I will try and approach Prepaid Legal. I hope they help people outside the US. Thank you.

To Lyle:

Thank you for the suggestion to use Better Business Bureau. I visited their site in search for help before writing but wasnt sure
they would help non-US business. Will try. Thank you.

To Subsystems

Your comments are very valuable. Let me put things right.

1. Yes. It is WebTrends Inc that provide web analytics solutions. Their main office is in Portland,Oregon.

1. We paid for every stock in our inventory.

2. On Dun & Bradstreet, the local office asked for about $5K in 2006 for an up-coming hearing in the US. After 2 years, I couldnt wait any more and wrote to their head office to complain. Within
the week, the local office returned the money to us and stopped their services. I apologise if I gave the wrong impression on this account.

3. The agreement indicated clearly that they have the option to buy back the stocks upon termination. The channel manager
who terminated the agreement asked for the stocks within the week of termination.

I hope this clarifies. I would love to hear from you on how to get them to pay.

Thank you everyone.

[subsystems]

Ok it makes sense now.

They exercised their right to buy back the stock you purchased upon termination of the agreement. However, they never paid for the stock they bought back.

The D&B issue is unfortunate and a waste of time but not relevant.

You need representation, but since you are on limited budget you need good but inexpensive legal help. Without reading the contract, it seems pretty cut and dry. Breach of contract and unpaid for stock that you returned in good faith. I don't see why they think they have any chance. Other than they have more financial means to drag this out.

I'd get legal representation and demand a speedy trial. I'd seek interest and legal fees since they are likely to have to pay that as well. I'd seek real damages as well.

I'm pretty sure at this point they are not just going to pay up. They can put off paying as long as the matter is in dispute. They are waiting for a court ordered decision before they pay.

You could settle out of court via binding arbitration. They might go for it if they feel they can get out of this cheaper by doing so.

BTW I have no legal expertise. Just using common sense.

[Eddy Tan]

To subsystems:

The agreement stated that the first course to dispute is arbitration.
D & B took that path. They even informed of the up-coming hearing in last April. Then all went quiet.

We are still working with another debt collection company to look into an arbitration. Using this avenue means no way to make them pay the costs. It is not cheap.

Questions.

1. do you know of any case in the US where the loser pays interest and costs for the court hearing and legal fees?
( Some countries draw the line clearly- each bear its own costs no matter what. )

2. I dont know how long the court case will drag. The longer it is the higher the cost.

I am still angry at being small. If the company happened to be HP or IBM I think the results would be different.

Thank you for your advice and taking time to write.

[subsystems]

No problem.

Legal help should be able to answer Q1.

Looks like getting Attorney's Fees are only in certain types of cases. Not civil cases in US Law. I suppose it may depend on CA State law.

Attorney's fee - Wikipedia, the free encyclopedia (http://en.wikipedia.org/wiki/Attorney%27s_fees)

I would think a judge would take a good look at the fact that you were acting "in good faith" when you returned the products. It may be able to be shown that they are not acting in good faith by their delaying paying for the product. It would be interesting to know if they were able to sell the product through the other channel partner. If they sold the product and didn't pay you then it could make them look shady in the eyes of a Judge.

If at some point you can get a court to rule in your favor and they still fail to pay you can put a lien on their business and property.
It would show up on their credit report and a bank may require them to pay you for them to get their loan. I know this is down the road but I do hope you prevail.

Good Luck.

[Eddy Tan]

To subsystem,

Thank for the advice and support.

I am still not comfortable about taking it to court unless I have a good idea on the cost and it must be within our means.

Thanks again.

[pragmatic]

Really a setback for small business group. I would suggest to hire a less expensive but expert professional to represent your case. Secondly, since, you have already taken legal action, so, you can again resubmit your case for hearing even after two years.
Adv. Pragmaticoutsourcing

[seo4china]

Why didn't you ask or make clear about the refund issue at the time you returned the products? Did they promise you at that time to refund it? You should have refused to return the goods until they provide you with a written documentation.

[Eddy Tan]

To pragmatic:

Yes. Indeed it is bad for small companies. Their agreement was re-validated annually and it stated that they had the right to re-purchase the stocks when the relationship was terminated. Yet they did not comply after asking for the stocks and getting back the stocks. The agreement also imposed on us as distributor to settle all outstanding invoices within time limit upon termination. We complied.

I asked myself - is the agreement meant only for the small guy? That's why I am angry at myself for being a small company.

I think it is quite common to see big guys bully small guys in the business world. Take an example: big guys buy from small guys on credit terms yet they take their time to pay...some even after 120 days... without penalty (they wont pay) while the small guys taking a bank loan is paying interest autmatically. Try delaying paying the bank, it will cost you more. Fair? Certainly not.

I am hoping to find a government agency that can help small guys at an affordable cost. Getting legal help to pursue the case myself can be costly and in US, it appears that each pays his own costs regardless.

To seo4china:
I hope the above explains.

Thank you, guys!

[subsystems]

Another approach would be to seek government help. Talk to your congressman and see what legal assistance you may have access to.

Or, talk to the SBDC. Small Business Development Center. They help small businesses with all sorts of issues. They have retired professionals that are "experts" in various areas. Perhaps you may find help that way. Their services are free to the small businesses.

sbdc california - Google Search (http://www.google.com/search?q=sbdc+california&rls=com.microsoft:en-us:IE-SearchBox&ie=UTF-8&oe=UTF-8&sourceid=ie7&rlz=1I7GGIC_en)

[Eddy Tan]

To subsystems

with no additional input on Monday, I thought this thread is at a dead end.

I am much comforted to see your advice.

Get help from Congressman? I am outside US.

Will look into SBDC right away.

Thanks alot!!

[Eddy Tan]

Looks like I am getting no where. No answers. It is indeed frustrating.

To all the small businesses out there in the US, do you get short changed by big guys?

Are you going to live with this kind of business bullying where big guys expect you to follow contractual agreement while they themselves dont because they know you cant afford to fight them.

3 years passed. I will continue to convince WebTrends Inc to pay up. I will contnue to invoice them. I understand I got 3 years more to go ....a 6 year limit in civil case.

There is only one alternative left - make a lot of money quickly and take them to court. I must try to make it happen....before the 3 years is up.

Thank you to all who took time to advice. You have added much strength to my resolve.