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Comment by debtscrewed | Hacker News Reader

Thank you.

a) Yes, and I'm dealing with a startup lawyer, at a very well-known Silicon Valley law firm (this is when we had money). He's been very very patient with our lack of being able to pay the retainer.

b) Through the corporation. It's registered under the Inc and has the EIN associated with it. However, it also has my SSN associated as the primary contact.

c) Well, I have a feeling that most of our credit card transactions are fraudulent, being in the space we are in. (For example, someone charged $12k on a card and tried to cash out to PayPal.)

I'll call up Rackspace and give it a shot. Thank you.

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Good luck - transparency is the name of the game.

Regarding (b) if your SSN is associated that's one thing - it's still the corporations debt and you can walk.

If you gauranteed it via your SSN that's another story, and it will reflect on your credit.

The last startup I was involved in, the guy who was running it talked to the lawyers and got them to waive a good chunk of the retainer fees when it sank

That's good to hear. I'd like to pay this lawyer in full for his services (retainer minus un-used retainer balance). I don't like screwing people over, even if they're expecting it to be a percentage of their clients that do that. I don't want to be in that percentage.

That's admirable, but if you can't pay, you can't pay. It's not worth selling organs over.

Let me correct a misconception here, you are not screwing people over, customers having payment issues is a risk of doing business, they all decided just how much debt they let you get in to.

If you had set out to create this situation on purpose that would be screwing people over, now all that there is left to do is to shut down as orderly as you can and to have everybody absorb an appropriate part of the loss.

To take that further. Don't be that percentage by not acting like them. Don't hide or promise things you can't deliver. You go to them. Lay it out and work something out.

Everyone takes risks doing people. Inability to pay is one. Bad people is another. The first is usually rarer and more manageable. The second is not so bad. You can avoid being in the second category.

*Mixergy interviewed a bankrupcy lawyer a while ago. Maybe there's something useful for you in it. One useful thing I remembered: Discounted debt is usually taxable. Be careful you are not caught off guard. http://mixergy.com/russell-demott-interview/

That's what I would expect here as well. Lawers are - if anything - pretty realistic about plucking feathers from frogs, and they'll be happy enough to see something rather than nothing at all. After all, they might be your preferred contact the next time you strike out and perhaps succeed.

Well, I have a feeling that most of our credit card transactions are fraudulent, being in the space we are in.

What space are you in? Phone cramming or reg path reoccurring billing or something like that?

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