In this week's Business in Vancouver, Curt Cherewayko reports that tech entrepreneur Dick Hardt has been named as a defendant in a statement of claim that alleges he made misrepresentations during a pitch to investors who eventually invested US$370,000 into Hardt's Sxip Identity Corp.
According to the claim, plaintiffs Caliber Management Ltd., Polygon Financial 05 LLC, Ron Stevens and Danny Robinson advanced money to Sxip Identity (in the form of convertible bridge notes) after Hardt approached them last Summer to fund the sale of some Sxip assets. The claim alleges that Hardt told the plaintiffs that he was in negotiations to sell Sxip Identity to Google, Microsoft or another notable tech company.
When Hardt's attempts to sell Sxip Identity failed, he told the plaintiffs that Sxip Identity was insolvent and that their notes has little or no value. This is where things get messy. The plaintiffs allege that Hardt failed to disclose that there were two separate Sxip entities (Sxip Identity and Sxip Network - he is CEO and President of both) and that only Sxip Identity would be a party to the notes.
Sxip Identity is indeed insolvent with a March 2008 balance sheet indicating that they owed Sxip Networks $4.7 Million and Hardt personally $275K. Sxip Identity's total assets at the time were just under $1 Million.
The Plaintiffs allege that because of this "related creditor" debt, Hardt and the company has already redirected to themselves any value that Sxip Identity had. The plaintiffs claim an order for restitution and rescission for the money they advance to Hardt, as well as damages. According to BIV, Hardt is examining his options.
Vancouver's tech entrepreneur community is small and everyone knows each other, so it should be interesting to see how this story unfolds.