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Back in August I was putting together a small skateboarding

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company, my original investor had...
Back in August I was putting together a small skateboarding company, my original investor had to back out because he was having family issues. I had two close friends who saw what I was going thru with trying to get this company off the ground. They had approached me and asked if I would want them to become apart of business. And if so they would be able to put up whatever money the original investor was going to. After a few meetings we decided that, the only way I was going to let them help was if they were going to actually put work in to the company, not just hand money over disappear and expect a return. Well with in a few weeks, both partners to voluntarily, turned their backs on me and the business. I made it clear to them that this is not what I wanted, this is what they decided to do. My last conversation with them was towards the end of August. Until I received a judgement against me in October, I was never served, so I had no clue about the court date. They have also decided to go into shops that carry us and have told them that they are co-owners of the company and that I ran away with their money, they have also stated that they will stop us from selling our product in our city, I am assuming by trying to bad mouth us. That investment amount is beyond small, we are basically 4 ambitions kids trying to make something out of nothing. 2 of us still work day in and day out on the brand. I have put in an endless amount of not only money but time and still continue to. Before we could actually put anyones name on paper and make the business legit they decided to back out, there are no documents or any agreements in writing. The only agreement was we were going to build this brand and hopefully one day it would pay off. My question is what should I do? I am a designer, not a business person.
Submitted: 7 years ago.Category: Business Law
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Answered in 38 minutes by:
1/1/2011
Business Lawyer: Lucy, Esq., Attorney replied 7 years ago
Lucy, Esq.
Lucy, Esq., Attorney
Category: Business Law
Satisfied Customers: 30,997
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Hi,

My name is XXXXX XXXXX I'd be happy to answer your questions today.

What they are doing is called "defamation of character." It is illegal for a person to make untrue statements about a third party that harm his reputation in the community. When the statements are about a person's ability to do his job, or about the commission of the crime (both of which could apply here), reputational harm is presumed.

The first step here is to send a demand letter ordering them to immediately cease and desist. It'll have a little more punch if you want to hire a lawyer to write it - it should only cost a couple hundred dollars for just the letter. Then, let them know that if they continue to harm your reputation in the community, you will sue them for damages, including lost sales.

You mentioned a judgment in October. If you were never served, you can file a Motion to Vacate the Judgment, based on that fact. The law prefers to decide cases on their merits rather than on technicalities. Unless they can prove that you actually were served, you should be able to get the judgment removed so you can file an Answer and defend the case on the merits.
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