SOURCE: IDI Global, Inc.

March 29, 2006 09:20 ET

IDI Global Responds to Lawsuit Filed by Mentoring of America LLC and HG Marketing LLC

OREM, UT -- (MARKET WIRE) -- March 29, 2006 -- IDI Global Inc. (OTC BB: IDIB) and its wholly owned subsidiary IDI Small Business, Inc. (IDISB) responds to press release issued on March 27, 2006, wherein Larry Russ of the law firm of Russ, August & Kabat announced that his firm had filed a lawsuit against IDI Global, Inc. and its subsidiary IDI Small Business, Inc. in the District Court of Clark County, Nevada. The press release and lawsuit allege that IDI misappropriated funds from an account that was "earmarked to fund 'PUT' rights held by Mentoring of America, LLC and HG Marketing LLC," Mr. Russ' clients.

When IDI purchased the St. George call center assets from Mentoring of America and HG Marketing it contracted with them to manage the center, and they promised to provide enough leads to the center to generate a minimum of $150,000 in monthly net income. Mentoring and HG have failed do this and they have refused to remit to IDI income from the call center operation that rightfully belongs to IDI. These and other claims will be asserted in the counterclaim that IDI is preparing to file in the lawsuit. IDI expects to recover damages from Mentoring of America, HG Marketing and their principals, Gary Hewitt and Doug Gravink, measured in the multiple millions of dollars.

The press release fails to mention the fact that in this lawsuit Mr. Russ twice requested that the Nevada District Court issue an order forcing IDI to freeze these funds, and on both occasions the District Court declined to issue such an order because both of their motions were without merit. The first time the motion was made, it was done without informing IDI or its attorneys and without allowing IDISB to file any papers in opposition, but the court still denied the request.

IDI is confident that the claims brought by Mentoring of America and HG Marketing will be judged to be without merit, and dismissed at the appropriate juncture in the lawsuit. IDI deposited $700,000 over the course of approximately one year into an IDI account that was intended to be the source of payment to HG Marketing if HG Marketing met certain performance criteria in its management of an IDI call center in St. George, Utah. IDI removed the $700,000 from the account only after HG Marketing clearly failed to meet the performance requirements that would have entitled it to receive the $700,000 and only after formal written notification to HG Marketing, Inc. The contract clearly states that if the "PUT" criteria are not achieved then the reserve money would be released to IDISB on a dollar for dollar basis. IDISB did not make any attempt to transfer funds into its operating account until after proper legal notification was acknowledged as received by HG Marketing, Inc.

Contact Information

  • Corporate Contact:
    IDI Global Inc.
    Mark Hildebrandt