TheDirectory.com Inc (SEEK)

[JohnWilliams]

In November of 2011 we acquired certain assets of BusinessList.com
from GusThomas Skarlis Jr. for a total of $150,000 in cash and on-convertible notes. In July of 2012, after making payments of approximately $78,500 in cash and being current on our note with the seller, the seller refused to provided services per our contract and breached the agreement and breached the contract by taking control of the website. After numerous attempts to regain control of the site we decided to file an arbitration action against the seller pursuant to our agreement. We filed an action against Mr. Skarlis in January of 2013. In May of 2013 an arbitration hearing was held with Ms. Julee L. Milham as the arbitrator. A conflict of interest had been identified between Mr. Skarlis’ lawyer and Ms. Milham prior to the hearing. After the hearing Ms. Milham agreed with our claim and wrote in her ruling that we had “established that the unresolved dispute between the parties is a breach under the contract and its exhibit A” yet she awarded us no damages even after affirming that indeed Mr. Skarlis had breach the contract. After the ruling, it was our and our attorney’s opinion that based on the bizarre outcome the previous relationship apparently had an impact on the decision Ms. Milham rendered. We appealed the ruling which was denied and the matter is now settled. We have removed all arbitration language from all future agreements as the process seemed incestuous and limited as opposed to the court system.

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