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Grinder Threatens Lawsuit

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Jeffrey Krepner
Grinder Threatens Lawsuit
on Jun 29, 2010 at 5:08:19 pm

Ah, the world is a lovely place. The story: a web production referral client turns Grinder on me.

The invoice for the shoot went unpaid for over 60 days and the invoice for the edit went unpaid for 45+ days for a web commercial for one of their clients. After many requests for payment, I eventually get paid after I agreed to setup a PayPal account to facilitate the client's wish to get frequent flyer miles via credit card. I'd walk away but I already shot part II (billed over 45 days ago--of course with no payment).

I suspect the reason they finally paid for part I was because they needed my services for part II. Because of the delinquent status of their account, I naturally requested to be paid in full for the shooting on part II and also a 50% up-front on the edit of part II because I really get the feeling they will follow the Grinder not Client protocol and drag their feet before (if ever) paying. In the typical Grinder MO, they are now beating me up on price for part II although we discussed it verbally and via email many many times.

Their client is super and easy to work with, so in an email to the Grinder I mentioned I'd be discussing this with their client (By "this" I mean the scope and length of part II). The Grinder took that as me wanting to go around his back and threatened to sue me. Here is the quote:

"You do and end around me with CLIENT NAME REMOVED and that will be the last video you get from this firm and I will sue you immediately for tortious interference!!!!!!!!!!!!!!!!!!!!!!!!!!"

If you don't know what that means, Grinder followed with this:

"I suggest your educate yourself on what that means! http://legal-dictionary.thefreedictionary.com/tortious+interference"

I'm looking for advice on how to solve this problem. I like the client the video is for, but I certainly have no desire to ever do work with this web production company ever again. Does Grinder have a case? If I refuse to do work until their account is paid in full, would he have legal grounds to sue saying I'm holding up his business? I'd be willing to settle for less money for part II (paid up front) just to walk away from the Grinder once the project is complete if necessary. Do I need to seek legal advice yet?

The numbers are (discounted since I thought this would turn into a repeat client--huh!)

Video #1 cost them a total of $1700. Video #2 will cost the same with $500 of that for the shoot that they were invoiced for on 5/6.

Thanks in advance!
-J


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grinner hester
Re: Grinder Threatens Lawsuit
on Jun 29, 2010 at 5:32:03 pm

No disclosure, non-compete or any other contract that says you can't market?
No worries.
You can't be expected to work for free either and the way you bill is up to you... not them.
Sounds like you should just weed them out of the equasion and makle more money by doing work for the actual client while saving them a lot of money.
I'd certainly never provide a service for a douche that threatens a brother with a law suit.
I've said it before... sometimes the best way to avoid being burned is not not lay down on a burning bed.



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Jeffrey Krepner
Re: Grinder Threatens Lawsuit
on Jun 29, 2010 at 6:00:09 pm

Amen to that. If I knew this place was so dickish I would have never agreed to work with them. Most of my clients pay net 30 or quicker, so this is new to me and like I said, I'll never do work with them again.

Their client is happy with the video I produced so far and I'd like to complete the next (and final) video for them but the trick I'm trying pull off now is getting paid upfront to finish... oh and not get sued.


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walter biscardi
Re: Grinder Threatens Lawsuit
on Jun 29, 2010 at 7:16:09 pm

If you do not have a work for hire and don't care about burning a bridge with that company and potentially other companies that the production company does business with, by all means contact that end client directly.

Just remember that production communities are small. Everyone knows everyone else somewhere along the way. Depending on the reputation of that other production company, it will be your word against theirs as to who was the wrong party in this thing.

I've had folks do an end around with my company as well. How I deal with that is a case by case basis. Your reputation is everything in this business so tread lightly. Whatever you do, do NOT take the low road and say anything negative publicly to anyone who matters. Always keep your words and actions professional. This one piece of advice saved my entire company and my reputation from a person who tried to smear my name to clients.

Walter Biscardi, Jr.
Editor, Colorist, Director, Writer, Consultant, Author, Chef.
HD Post and Production
Biscardi Creative Media

"Foul Water, Fiery Serpent" featuring Sigourney Weaver coming soon.

Blog Twitter Facebook


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Jeffrey Krepner
Re: Grinder Threatens Lawsuit
on Jun 29, 2010 at 7:57:22 pm

Walter, I wasn't very clear in my post--I have no intention of doing an end around in any way shape or form. I do not want to do business directly with the end customer. I truly just want to finish this project and leave it be and never look back.






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walter biscardi
Re: Grinder Threatens Lawsuit
on Jun 29, 2010 at 8:27:32 pm

Well that does clear things up a bit. And it sounds like a very good plan. :)

Walter Biscardi, Jr.
Editor, Colorist, Director, Writer, Consultant, Author, Chef.
HD Post and Production
Biscardi Creative Media

"Foul Water, Fiery Serpent" featuring Sigourney Weaver coming soon.

Blog Twitter Facebook


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Mark Suszko
Re: Grinder Threatens Lawsuit
on Jun 29, 2010 at 8:29:06 pm

Wow, for a second, I thought the title read: GRINNER threatens lawsuit! :-)

The lawsuit threat is likely a bluff: if he had the money to throw away on a lawyer to file the suit, he'd more than have enough money to pay you off. Wouldn't he? You might phrase your response to him that way.

The Cowboy Way or Bushido Code or whatever you want to call it, is loathe to end-run around the guy to bid the client directly, even if he is a tool. It's just not cricket.

However, that is different from warning that end client that this contractor is a problem payer. He's no doubt marking up your work on his bill by quite a large margin, and doesn't want the final client to know. Your counter-threat can lay out that you don't want the guy's business but if pressed WILL communicate to make clear what the facts of the case are.

Your request for money up front has disrupted the grinder's carefully structured financial deal; whatever interest-bearing scheme he's parked the money in will no doubt have penalties for early withdrawal, thus your request has put a dent in Mister Big's boat payment, when he pulls the money to pay you.

I say sit tight and stick to your guns regarding payment. Delivery is your only leverage.





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Jeffrey Krepner
Re: Grinder Threatens Lawsuit
on Jun 29, 2010 at 9:31:56 pm

Thanks for the info guys--always a pleasure being here. I really need to participate more at the Cow instead of just reading.

Ok, back to the story.

After a careful email on my part I've diffused the situation to a more reasonable level of loathing for both parties. They are willing to pay me, but there is some mumbo jumbo about why they can't pay me until the end customer pays them first. I think I get frustrated because I expect that other people are as prompt in paying hired hands I am. Unless we are talking a giant sum of money, I would never dream of paying people after I get paid. This isn't a tiny company either and my thinking is that your lack of liquid working capital doesn't necessitate me working without pay.

Mark is right. Mr. Big wants to keep his money parked and he doesn't want me to bill the end client directly because the end client would then learn the amount this service is being marked up.

Perhaps I should re-invoice for the shoot with terms of Net 14 and add a note that late payment results in a weekly penalty of 20%. I'll also make it clear that I won't start the post on this until the shoot is paid for and I get either 1/3 or 1/2 of post upfront. That at least makes my terms somewhat clearly written out if things go off-track.

I really hate all of this. I should be doing something creative instead tracking down small amounts of money from toxic clients. I guess my time was due as I've been extremely fortunate with my clients always paying promptly up until now and certainly won't associate with this client once the project wraps.


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Todd Terry
Re: Grinder Threatens Lawsuit
on Jun 30, 2010 at 12:19:19 am

"Perhaps I should re-invoice for the shoot with terms of Net 14 and add a note that late payment results in a weekly penalty of 20%."

Not a bad idea, Jeffrey... but you can only do that if this is a new job for which you have not hammered out the details or have a contract on yet (which this may be, I'm not sure).

As much as people (me included) would like to do so, you cannot by law retroactively decide to include late payment or finance charges. If you want to do that, it has to be done beforehand and stiuplated in the original contract. Usually the verbage is something like "Payments after due date are subject to finance charges up to the maxiumum allowed by state law." It varies some from place to place, but in most states the max allowable finance charges are 25% a year (more than that is considered "usery"), so that's why you see finance charges of 2% a month very commonly.



T2

__________________________________
Todd Terry
Creative Director
Fantastic Plastic Entertainment, Inc.
fantasticplastic.com






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Bob Zelin
Re: Grinder Threatens Lawsuit
on Jun 29, 2010 at 10:06:25 pm

I talk like a bigshot on Creative Cow, but I know how uncomftorable this can be in real life, with a client. Since your client has made a "threat" to you, it really would not be that difficult to simply call the client, be VERY nice on the phone, and say "look, I love working for you guys, and I want to do a great job for you again, but there was a problem with payment last time, and I just want to make sure that I am going to get paid if I do this job". Basically, appear to bow down to them, and see what they do. They may in fact say "you want to work for us, we will pay you when WE get paid, and we have no control over that" (I have been told this crap before). Then you do what you have to do. But be nice, don't threaten, and feel them out. This is business - lie all you have to, to get your end result.

Bob Zelin




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Nick Griffin
Re: Grinder Threatens Lawsuit
on Jun 29, 2010 at 10:30:10 pm

What??? Zelin said something non-confrontational??? And it makes sense??? Bob, did you finally swear off the twelve pots of coffee a day?

Long and short of it is, don't completely alienate these people (the web developers), just don't work for them again. Just get paid first. If being subservient for now accomplishes that, so be it. Just blame it on someone else: "Geez, I'd like to, but my accountant says I need the cash flow THIS month."

The good news is if in the end client knows who you are, they are likely to (OK... MAY) contact you directly in the future once they've figured out that their web developer is a d*ckhead.

Oh, and as to "tortious interference?" Give me a break! For anything under six figures that's a pointless (and STUPID) bluff.


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Tim Wilson
Re: Grinder Threatens Lawsuit
on Jun 29, 2010 at 11:07:58 pm

[Bob Zelin] "This is business - lie all you have to, to get your end result."

You have been, and always shall be, my hero.


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Stephen Mann
Re: Grinder Threatens Lawsuit
on Jun 30, 2010 at 3:23:13 pm

"I have no intention of doing an end around in any way shape or form. I do not want to do business directly with the end customer. I truly just want to finish this project and leave it be and never look back. "

Have you tried communicating this with the Grinder?

(It appears to me that Grinder has no business sense or experience. And that Google is his legal adviser).

Bottom line, your work for the Grinder is due on terms between you and Grinder. It's not your problem that the Grinder can't pay you until the client pays the Grinder.



Steve Mann
MannMade Digital Video
http://www.mmdv.com


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Jonathan Ziegler
Re: Grinder Threatens Lawsuit
on Jun 30, 2010 at 3:30:15 pm

I agree, it sounds like your Grinder (this is now a term that I will use, by the way - for me a "grinder" was either a career card player a la Rounders or anyone just going through the motions of their life vs. really living) doesn't realize he STILL HAS TO PAY - the deal isn't between you and his client so whether or not his client pays is immaterial - the deal is between you and the grinder and when the work is done, he has to pay regardless of whether or not the grinder's been paid.

Jonathan Ziegler
http://www.electrictiger.com/
520-360-8293


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Jonathan Ziegler
Re: Grinder Threatens Lawsuit
on Jun 29, 2010 at 11:15:00 pm

What kind of contract do you have with the Grinder? Any? It didn't sound like there was anything more than emails, but that doesn't mean there's no legal obligation for either of you. I would (like a broken record) talk to a business attorney.

It'll be worth talking to an attorney for a few bucks and see if they can do anything (or even need to do anything). If you go, bring printouts of any emails you have, paperwork, etc. - in fact, if you can briefly explain the situation on the phone (ie: I have a client who is slow on payment, I still have more work to do, they are being hostile and have threatened to sue, what do I do?).

Most attorneys will give you some kind of free consultation (30 min - 1 hour) and don't forget to ask for their rates and whether they are charging you right now. Shop around if you're not sure or get a referral from another business owner - call a couple clients or colleagues you trust.

Jonathan Ziegler
http://www.electrictiger.com/
520-360-8293


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Jeffrey Krepner
Re: Grinder Threatens Lawsuit
on Jun 30, 2010 at 10:24:09 pm

Bob - Well said. Unfortunately, I think that I’m the one being lied to this time. I’ll try to lie better... and more often going forward. I’m lying right now.

T2 - Thank you for the clarification regarding changing contracts around mid-stream. I supposed if people could change interest rates or late fees on a whim, we'd have chaos.

Jonathan - No contract pers se. I did work with them on one other project a couple of years ago so I figured things would be ok. Now that I think about it, last time I billed the end customer directly, otherwise I’m sure I would have realized this is a Grinder not a client back then. I’d like to thank Ron Lineboom for bringing the term Grinder to my vernacular. In case you missed it: http://magazine.creativecow.net/article/clients-or-grinders-understanding-t...

Nick/Stephen - I have communicated with Grinder. He has calmed down now, so there is no longer the threat of being sued. He explained why he can’t pay me until his firm gets paid, but as we said his payment terms with his client are his and not mine.

Since there isn’t a contract I wonder if I can’t simply just walk away from this and if need be eat the $500 for the shoot? Maybe I can explain to him that I don’t accept those payment terms and that I will make the footage I shot available to him once his account is in good standing. That way he has to pay me for the shoot and I’ll be paid for the work I did so far and then everyone can go about with their merry little lives.

Am I nuts here or what? I suppose I could play by the Grinder’s rules and deliver this video and hope he is kind enough to pay me when his firm gets paid. Perhaps I’m making too much out of this. Would anyone shoot & edit and turn over a video with no payment up front and no set date for final payment? Man---I thought I was smarter than this!


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Patrick Ortman
Re: Grinder Threatens Lawsuit
on Jul 1, 2010 at 1:24:31 am

>>Whatever you do, do NOT take the low road and say anything negative publicly to anyone who matters. Always keep your words and actions professional.<<

Walter's right. But it is not always easy to hold these things tight to the vest until your tell-all book comes out ;-)

These are really weird times, and the grinders are out in force. The web dev/web design/production shops (as it sounds like you're dealing with) are especially getting beaten up pretty badly by clients. We've had two bankruptcies from clients, and one who just cut all their advertising and marketing and wonders why they're going out of business.

However, a fair and honest digital agency will make sure to get their contractors paid- I always include our contractors' initial fees in the overall deposit we require from clients, so even if we get stiffed our contractors get paid for the time they've spent thus far on the project. It's the right thing to do, and if you're going to run a digital agency you need to play fair. If a client won't give enough of a deposit to cover contractor's (at least initial) costs, then we simply can't and won't accept them as a client. It sounds like the agency you're dealing with doesn't get that. Please don't think we're all like this, though. :-)

I'm glad you're figuring out your situation, and I hope you hang on to those angry emails- we had a client who loved loved loved our work and said so in email after email, and told people we were great. Then she went off her meds and freaked when I told her we couldn't make $50K worth of changes to her project for $15K. She, like your grinder, threatened to sue and threatened to ruin our agency's name online unless we complied. Having those emails to present to her once her bender was over has been useful, and she now claims it was "all a misunderstanding". Whatever, right? Bottom line: protect yourself and your reputation. Walter's right: it's VITAL.




---------------------
http://www.patrickortman.com
Web and Video Design


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Ned Miller
Re: Grinder Threatens Lawsuit
on Jul 1, 2010 at 2:53:24 am

Are you a man or a mouse? Go in there in your tightest muscle T and demand payment. I've done it dozens of times over three decades. Seem slightly unhinged. Works every time.

Ned Miller
Chicago Videographer
http://www.nedmiller.com
http://www.bizvideo.com


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Steve Wargo
Re: Grinder Threatens Lawsuit
on Jul 3, 2010 at 6:39:44 am

After reading the other comments, I say that the because web guy has already threatened a lawsuit, that relationship is now done.



Steve Wargo
Tempe, Arizona
It's a dry heat!

Sony HDCAM F-900 & HDW-2000/1 deck
5 Final Cut (not quite PRO) systems
Sony HVR-M25 HDV deck
2-Sony EX-1 HD .

Ask me how to Market Yourself using Send Out Cards


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Steve Wargo
Re: Grinder Threatens Lawsuit
on Jul 3, 2010 at 6:27:53 am

Without reading any of the other posts, I would go straight to the end client and ask for resolution. The Web Company is blowing smoke and can't do anything. Sue them in small claims for non-payment.

If I were paying them and they were pulling that crap, I would want to know abut it and it wouldn't be good for the middle man.

Gee whiz, Since I turned ?? on my last birthday, I now tolerate nothing at all. I am more upfront with clients and get paid quicker. Should have developed this attitude years ago.

Steve Wargo
Tempe, Arizona
It's a dry heat!

Sony HDCAM F-900 & HDW-2000/1 deck
5 Final Cut (not quite PRO) systems
Sony HVR-M25 HDV deck
2-Sony EX-1 HD .

Ask me how to Market Yourself using Send Out Cards


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John Baumchen
Re: Grinder Threatens Lawsuit
on Jul 8, 2010 at 9:32:15 pm

Ahhhh, with age comes wisdom, (well, most of the time anyway). As Winston Churchill once said, "too bad youth is wasted on the young"


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grinner hester
Re: Grinder Threatens Lawsuit
on Jul 16, 2010 at 3:12:01 pm

You never have to worry about grinders filing suit.
Why? Because lawyers don't haggle.



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Jeffrey Krepner
Re: Grinder Threatens Lawsuit
on Jul 16, 2010 at 4:05:06 pm

All very good points guys. I'll keep you posted and if they actually pay me for the 2nd project I'm going to play the odds and buy as many Powerball tickets as I can since I must be on a lucky streak. Once I win, I'll sell all of my gear and then move to the islands where I can read The Cow and laugh at everyone's Grinder issues as I drink Singapore Slings w/ mescal on the side.

Thanks again.
-Jeff


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