Qtrax Update: More Lawsuits & Judgements, No Portability Launch…
By Jakomi Mathews on Jun 10, 2009 with Comments 14
Since writing our first exposé on the dodgy dealings of Qtrax founder Alan Klepfisz in April, there have been some new and interesting eventualities that we thought TMV readers would be interested in.
Firstly after having announced a deal with WMG on Feb 19, 2009, Qtrax still hasn’t made Warner content available. Why? TMV believe it is because they have yet to pay Warner the advance payment owed in order to get possession of the content. After some research it appears that Klepfisz has been on an international trip looking for more cash in order to pay Warner as well as settle some of the many financial judgments against Brilliant Technologies, Qtrax and him personally. These judgments are quickly approaching 7 figures and Klepfisz hasn’t held any shareholder meetings or filed any SEC reports in over 2 years.
The BLLN investor forums have been rife with fury over what has been characterized has “AK’s lies”. Evidently some of these small investors have been livid with the recent discovery of a significant amount of legal action against the company that had not been disclosed to shareholders as well as the shocking number of bounced checks that Klepfisz has been passing.
Klepfisz defenders on these boards are telling their fellow shareholders to be patient because portability and an international launch are just weeks away. These Qtrax defenders have been accused of “pumping and dumping”. According to one poster named “qcrap”, “just look at volume of stock”. The institutions are trapped because AK has them trapped. He has not filed so they cannot sell the toxic shares they have acquired and they are no doubt rightfully angry as well.
One poster goes on to say, “Trust me. that will be the next legal news you see…another example of lying to people…these guys funding the company to keep it going are now stuck with shares they cannot sell…good grief this guy is a snake! ”
Some zealots on this particular board, like the poster calling himself “Q-tunes”, post not only a blind defence of Klepfisz but also bazaar conspiracy theories. “I think it has always been clear that Apple, or someone, discovered the deals were not final and used it to try and kill Qtrax. On the positive side, Qtrax was able to show the labels the massive global interest in the service- just look at the web traffic the day of the non-launch. Maybe the labels were a little sneaky in there negotiating, trying to get more out of Qtrax. This, along with the economic down turn really slowed the process, IMO. Overall, though, the Midem event really only caused some bashing from the bloggers… because it gave them something juicy to write about and stir up debate. Now that the dust has settled, Qtrax has a little time (while under the radar) to finalize and fine tune their product before launching it the RIGHT WAY.”
Talk about delusional loser! In TMVs view information available in the pubic domain condemns AK. Alan via Robin Kent even contacted TMV requesting an “off the record” chat. I say what is the point of an “off the record” chat when there are so many legal issues in the public domain. How about an “on the record” chat? But considering he has not filed any SEC reports in two years. In the US that is a federal offense. TMV’s key question would be why have these SEC filings not been made? But we all know the answer to that one. If he had filed these reports TMV is pretty sure his investor base would be non-existent! Anyone called the FBI yet?
In the meantime Klepfisz has been tracked to the 5 star Langham Place Hotel in Hong Kong, where he staked out last week and most likely took advantage of the “world class spa”. He appears to have moved his road show to Singapore this week, where he seems to consistently find money. Klepfisz evidently has a way with Asian investors who apparently don’t really care about rigorous due diligence.
The deal for new investors, according to the aforementioned boards, is that Klepfisz is offering shares in Qtrax, not the parent company Brilliant Technologies (BLLN is currently trading at around $0.025 a share) at $.50 a share with a minimum purchase of $25.000. But fear not, he’ll throw in an option to purchase an equal number of shares for the bargain basement price of $0.25 each. So let’s do the math: $25,000 will buy you 50,000 shares and you’ll be able to buy another 50,000 shares for $12,500 thus making you the proud owner of 100,000 shares of Qtrax for a mere $37,500. And the key thing here of course, is that none of this has been reported to the Securities Exchange Commission (SEC).
On top of all this, there still lurks an action recently filed in the US Federal Courts in the Southern District of New York. US Federal Court are much more serious than state courts in the US and heretofore all of the Klepfisz/Qtrax/Brilliant lawsuits have been field in state courts. For some reason the federal suit has not yet been filed electronically. To get a copy one must visit the court and get one physically. TMV wonders if Klepfisz tried to somehow negotiate a deal to keep the suit from being available over the internet in an effort to shield it from investors?
Finally, where do labels stand on all this? Major labels seem to have no problem taking money from Qtrax even though it has clearly come from investors who Klepfisz does not pay back…moral? Not in TMVs view, but then again the labels have been know for years to be worse than pimps in the morals department – Not all but a damn cite many.
Other readers also read:
Qtrax CEO Tells TheTruth Or At Least The Courts Do
Qtrax Relaunching? What’s About all the Lawsuits it is Facing? TMV Drills Down on Qtrax
Music Lawsuits Move Beyond Music, Targeting Merchandising Cash Cows
Filed Under: Business Models • Gadget & Service Reviews
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Everyone is now well familiar with the story of Spiral Frog and how it buried the ad-supported download model. Reasons given for this are numerous, ranging from reports of blatant mismanagement to non-compatibility with iPods to consumer resistance to being force fed a 60 or 90 second commercial before the...
[...] Qtrax Update: more lawsuits & Judgments, no portability launch… [...]
[...] luck collecting, Millenium. I do have some very good advice for you though: if “AK” decides to settle, don’t [...]
Yeah, Mashboxx is just hilarious *sarcasm*.
oldnirrelevant, how about next time you actually try contributing something useful to the conversation than just a pathetic and failed attempt at trolling, ok?
mashbox lololollll
@ Hatter:
“A guy with a great project tries to create an alternative that any music lover will be thankful for and, surprise surprise, there is a change he would not survive this world economic crisis? Do you really need a conspiracy theory to believe that his VERY rich competitors will not be happy for the competition and might just possibly be involved in highlighting the weaknesses, scaring investors, shareholders, etc?”
First of all, what competitors are there in terms of offering ad-supported music downloads? Last I checked, the only true competitor, SpiralFrog, went under. Also, where is the proof that these so-called rich competitors are involved in so-called highlighting weaknesses, scaring investors, shareholders, etc. as you claim? I don’t see why Apple’s iTunes or Amazon’s AmazonMP3 would be afraid of BLLN’s Qtrax, a product that has failed at delivering on almost every single deadline it seems and whose parent company is worth only 2-3 cents, when Apple and Amazon have both built highly successful and profitable products in the marketplace. Please in the future Hatter state facts and not pure hearsay/speculation as fact.
“I am not a great conspiracy lover but I believe that when money, and potentially big money is involved, it is common sense, rather than conspiracy too expect that today’s market forces are very strong and are dominated by less and less players and that if someone has infinite amount of money, he might spend just a little of it to repress potential competitors.”
Again, please provide proof of such activities, otherwise, I am inclined to believe you are merely stating pure hearsay based on your own personal beliefs, rather than actual facts.
“If Qtrax will collapse, don’t hold your breath for ‘what will come next’ unless your dreams are fulfilled by the next iphone 3.blsht.”
Excuse me, but that seems are rather strange characterization of Apple’s iPhone (all three generations of it) given that it has sold over 20 million units since 2007. That sounds like a pretty successful product to me. Also what does the iPhone have to do with Qtrax offering ad-supported downloads? It sounds like you’ve committed yet another fallacy with the your above sentence Hatter.
“The money Qtrax and Brilliant are collecting is money they use to pay the labels, that is- money they collect to fulfill their project and debts.”
True, but they are also required to repay the creditors too, which judging from the court documents they are not doing.
“I must say I am extremely curious about your passion.”
The same could be said about you, however, in both cases, it would be irrelevant to the actual facts of the argument.
The bottom line here, Dr. Hatter, is that rather than address any of the accusations, whether biased or not, laid forth by Jakomi and TMV in this article with actual concrete facts, you simply engage in relentless fallacies in the form of misdirections, half-truths, ignorance, and verbal abuse of character.
@ Hatter:
“No chance anybody would give a xxxx about a project, unless they think that there are serious chances it might be the next thing.”
Heard of the term called fallacy? You are committing one with the above sentence. You can be interested in a project and not believe it will be the next big thing. In the future, it might be prudent to actually formulate a valid argument.
“You guys should be honest and at least give Klepfitz the credit that he gives music a chance.”
Yes, Klepfisz does deserve credit for one thing: failing at every single turn. Have you forgotten about all the missed deadlines (including the recent non-existent blog that was suppose to launch yesterday on June 27th according to their update) and broken promises? BTW it’s quite suspicious how your blog appeared on the Qtrax site as an “independent” blog.
The lawsuit field in US Federal Court has finally been scanned into the electronic filing system. Guess what? It seems as though Klepfisz bounced even more checks!
I see your readers are even more sharp and moral than you are. Is it a failed football team blog here? I love it, you guys love blood, don’t you? I just can’t imagine honest people having their heats, today, (just as a random example) directed to the well being (or not) or Mr. Allan Klepfitz (hope I spelled the name right, my spell checker doesn’t think so). Did you write in your more personal blogs about the bathaa market acar bomber killimng 28 civilians this morning? Oh, right, and that Nazi shooting in the Holocaust Museum? Did Gaza civilians get their nutrition supplies yet? Somehow, I feel you guys really lost proportions, and for you, a car bomb is just another cool Youtube video on your iphone.
I got here while looking for information about Qtrax- because I am interested in MUSIC (remember what that is?). I am getting more and more curious what other motivations people can have to write or read a music blog…
I must say that while recently, I got worried that the only forces that are going to survive this crisis are the big old guys that always did and always will repress music and music lovers, the hysteria here MAKES ME VERY OPTIMISTIC, at least about Qtrax. No chance anybody would give a xxxx about a project, unless they think that there are serious chances it might be the next thing. Lets hope together. At the end of the day, we can all be cynical, but we music lovers will all benefit from it. You guys should be honest and at least give Klepfitz the credit that he gives music a chance.
@ Dr. Hatter. Spoken with eloquence and grace. You don’t have to have to prove a conspiracy to see an agenda. Whether or not some of the allegations stick, there are a couple of “disgruntled” kids on the quoted iHUB board spending day and night attacking the CEO and company. Literally, day and night. Methinks thou doth protest too much.
Great post, Jakomi! This guy must be a real piece of work.
Could Klepfisz be avoiding service of yet more lawsuits by hanging out in Asia for so long?
“BLLN is currently trading at around $0.25 a share”.
Um actually TMV, it’s $0.025, which is a big difference.
Thanks for this correction updated now Ed
Put some videos up!! fucking hell man..who gives a fuck about Q trax anyway..it’ll go the way of spirlfrog – old and irrelevant
Blood thirst- don’t your readers just love it? A guy with a great project tries to create an alternative that any music lover will be thankful for and, surprise surprise, there is a change he would not survive this world economic crisis? Do you really need a conspiracy theory to believe that his VERY rich competitors will not be happy for the competition and might just possibly be involved in highlighting the weaknesses, scaring investors, shareholders, etc? Btw, all this detailed information about his whereabouts, are you tracking him using Google Earth or are we supposed to remain convinced that only distorted minds could imagine that some conspiracy might be involved?
I am not a great conspiracy lover but I believe that when money, and potentially big money is involved, it is common sense, rather than conspiracy too expect that today’s market forces are very strong and are dominated by less and less players and that if someone has infinite amount of money, he might spend just a little of it to repress potential competitors. For all music lovers, I am praying that Qtrax will succeed- not only because this is one great project, but because a failure will not only a sign of Qtrax’s failure- but of the fact that there is less and less room for anything genuine to happen, unless the big guys will benefit from it. If Qtrax will collapse, don’t hold your breath for ‘what will come next’ unless your dreams are fulfilled by the next iphone 3.blsht. I am not a lawyer and I know very little about the financial laws, but what I am sure of is that all these juicy details you are giving, with a big smile on your face, are nothing but the way a struggle to survive looks like in times of crisis. (Have you seen by any chance Herzog’s Stroszek?) The money Qtrax and Brilliant are collecting is money they use to pay the labels, that is- money they collect to fulfill their project and debts. My moral instinct is simply not tickled by stories about ‘bad people’ trying to survive by doing what they need to be doing to survive. You seem to have some views about ‘these Asian investors’. Did it ever occur to you that they might simply believe in the project and trust Klepfisz, that is, believe that Qtrax will survive the crisis? I, for once, tend to make a simple distinction. If you need to be a lawyer to understand something, then it just doesn’t create in me this Hollywood feeling of ‘lets get these bad guys’. Someone’s bad luck, if anything, is not something I could gain as much pleasure as you seem to gain here. I believe the project will succeed because it is a great project and because many music lovers, like myself, simply don’t have money to pay for anything they want to hear, and they are looking for any legal and risk-free alternative. I must say I am extremely curious about your passion. I don’t know your style of writing but I am wondering- are you always as happy when something bad might happen to someone, or is it that you have some involvement in the matter?