Remember this guy, used to be CEO of Genco ,SLX symbol pre-merger.
Robert Gardner back up to the same old , same old.
by Mike Caswell
Viridis Energy Inc. has filed a countersuit in the Supreme Court of British Columbia against its former chairman, Robert Gardner, for breach of duty. Viridis claims that he caused the company to incur excessive fees and, after he was dismissed as chairman, he told creditors that the company suffered from mismanagement. The company seeks damages for defamation, among other things.
The counterclaim comes as part of the company's response to a brief suit that Mr. Gardner filed against it over unpaid director fees. He claimed that Viridis owed him money for service as a director, plus expenses. He said that he invoiced the company for $87,414, but only received $29,325 in payments. He sought a court order for the remaining $58,089, plus interest and costs. Vancouver lawyer John Shields filed the suit on behalf of Mr. Gardner.
Viridis's response and counterclaim
Viridis, in a response to Mr. Gardner's suit filed on Friday, Sept. 9, says it owes him nothing. The company claims that he unilaterally increased his monthly director fee from $8,000 to $14,000, and that he breached his duties as a director.
While the response provides few details, the attached counterclaim has more information. In it, the company accuses Mr. Gardner of incurring hundreds of thousands of dollars in fees as he attempted to raise money. The company says it received little or no value for those fees.
The trouble, as described in the counterclaim, began in 2009 when Mr. Gardner proposed a new business for Viridis. He approached a private entity called Cypress Pacific Marketing, which sold wood pellets, and encouraged it to go public through a reverse takeover with Viridis (which was then called GridSense Systems Inc.). He said he could raise the money necessary for the deal.
His efforts in that regard fell far short of success, the counterclaim states. Without the knowledge of the board, he hired a Florida company called Red Chip to help raise money. Viridis claims that Red Chip did not provide any service of value and, despite that, charged $300,000 in fees. Mr. Gardner then hired West Vancouver promoter Donald Rutledge and another man, Stefan Powels, to help raise money. They too had no success, and in the case of Mr. Powels the company ended up paying $40,000 in fees and was sued for $25,000 in unpaid invoices, the countersuit states.
These efforts left the company in a precarious financial position in February, 2011, the countersuit contends. By that time it had negotiated an additional agreement, this one to buy a Kelowna company that made wood pellets. As part of that deal Viridis was required to pay $1-million to the vendor by Feb. 14, 2011, but had insufficient cash. On Feb. 8, 2011, the company removed Mr. Gardner as chairman, leaving him as a director, and looked to raise the money on its own.
According to the countersuit, Mr. Gardner then actively tried to prevent Viridis from raising money. Among other things, he told one of its creditors that the company was mismanaged and insolvent, and was about to default on its obligations, the countersuit states. The company says these were "untrue, derogatory and harmful allegations."
The company claims to have suffered damage to its reputation and losses from excessive fees as a result of Mr. Gardner's actions. It seeks damages for defamation, damages for breach of duty, aggravated damages, punitive damages and special damages, plus interest and court costs.
Parhys suit
Viridis has also filed its response to an unpaid debt suit that it faces from Parhys Investments Ltd., an entity affiliated with Mr. Gardner that claimed to have lent Viridis $125,000. Parhys filed a notice of claim against Viridis in the Supreme Court of British Columbia on Aug. 11, 2011. It claimed that it lent Viridis the money on Dec. 20, 2010. The company was to repay the loan by March 20, 2011, but did not do so, despite demands. The suit sought payment of that amount, plus interest and court costs.
In response, Viridis says that it did not receive any money from Parhys, but it did borrow $125,000 from a company Mr. Gardner controlled called Magna Management Ltd. It received the loan in December, 2010. For reasons not clear to Viridis, a note memorializing the loan listed the lender as Parhys. According to the response, Magna has never requested repayment, and Mr. Gardner confirmed on April 18, 2011, that the loan had no specific repayments terms. The company asks that the suit be dismissed.
Vancouver lawyer Bryan Baynham of Harper Grey LLP filed the responses to both claims as well as the countersuit on behalf of Viridis.