[Article] Another lawsuit filed against United Fiber & Data, This one in Allentown Options

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Another lawsuit filed against United Fiber & Data, this one in Allentown
Liz Evans Scolforo |York Dispatch
Published October 13, 2020

Another lawsuit has been filed against United Fiber & Data, this time by an Allentown-based company that alleges UFD defaulted on an agreement to pay the company future tax credits.

EPC-Allentown LLC filed the suit Friday in Lehigh County Court alleging breach of contract and asking that the court order UFD to pay EPC $10.5 million plus accrued interest.

The lawsuit states that EPC anticipates the amount it is owed by UFD will increase by nearly $7 million in the next few months.

At issue is property in a state-designated Neighborhood Improvement Zone in Allentown's downtown area. The NIZ provides tax incentives and financing "to attract developers to build within its boundaries," the lawsuit states, and EPC develops and manages real estate in the NIZ area, the suit states.



EPC constructed an office building at 832 Hamilton St. in 2016, and several years before that — in May 2013 — entered into an agreement with Think Loud Development LLC to develop the building, the lawsuit states.

At the time, Bill Hynes was still CEO of UFD and Think Loud corporations. Live members Chad Taylor, Chad Gracey and Patrick Dahlheimer were also part of UFD, Think Loud Development and a number of other Think Loud limited-liability corporations.

All three of the Live members resigned their active management roles in UFD no later than Feb. 1, 2016, according to attorney Jason Confair, who represents Think Loud.

Hynes stepped down as UFD's CEO in November 2019 amid unrelated criminal charges.

"To be clear, EPC’s suit seeks payment from UFD for NIZ tax credits that UFD was supposed to generate. Although the various transactions referenced in the EPC complaint are related, the heart of the lawsuit is quite simple — UFD failed to generate NIZ credits to pay its rental obligations," Confair said in a statement. "Indeed, EPC does not name any member of Live, any entity-affiliate of Live, or Mr. Hynes as a defendant in the lawsuit."

Allentown lease: In 2013, UFD leased 10,000 square feet of office space in the 832 Hamilton St. building as a condition of its development agreement with EPC, according to the lawsuit.

UFD is based at 210 York St. in York City, where Think Loud spent an estimated $16 million renovating the old building just off North Queen Street. For that building renovation, Think Loud received a $5 million grant from then-Gov. Tom Corbett.

Kinsley Construction has obtained a nearly $14 million judgment in relation to the 210 York St. renovations. Read more about that case here:

More:Kinsley awarded nearly $14M judgment against Think Loud-related business in York

UFD was created in 2012 by Live members and Hynes to bring high-speed internet to Pennsylvania's southcentral counties. Since that time, it has laid about 400 miles of fiber-optic cable from Manhattan to Ashburn, Virginia.

$5M Allentown loan: As part of the Allentown development agreement, EPC loaned Think Loud Investments LLC $5 million, and UFD entered into a surety agreement with EPC to guarantee the loan, according to the lawsuit.

EPC is not suing over the $5 million loan.

More:Trial ahead for York City CEO Bill Hynes, accused of stalking, burglary

More:York County sheriff 'derelict' in duty over parking issue, board says

More:York CEO, a felon, went target shooting with county Quick Response Team

By the fall of 2016, UFD had breached its lease by failing to pay tax credits, Think Loud Investments had breached its obligations under the development agreement, and "yet another entity related to UFD, Think Loud Allentown LLC" had breached its obligations to members of 8th Street LLC, according to the lawsuit. EPC is one of 8th Street's members.



In October 2016, UFD entered into a forbearance agreement in which EPC agreed not to immediately enforce its agreement rights for the breaches and to allow UFD to continue its occupancy in the Hamilton Street building at "favorable" rent terms, according to the lawsuit.

In exchange, UFD provided EPC with updated figures for NIZ taxes to be generated from 2016 to 2023 and committed to generating those set minimum amounts each year, the suit states.

"Further, UFD agreed to annually pay any shortfall in NIZ tax revenue" either in UFD's own membership interest units or in cash, according to the lawsuit.

UFD's agreed-upon yearly minimum NIZ tax revenue for 2016 was $1.65 million, which jumped to $6.2 million in 2019 and is expected to increase to $9 million in 2023, the lawsuit states.

Shortfalls: In March 2018, EPC billed UFD about $1 million for its 2017 shortfall in NIZ credits, which UFD paid off incrementally, the suit states.

UFD's 2018 shortfall is about $4.5 million, of which UFD has paid about $133,200, the lawsuit states. UFD has failed to make any payments toward its 2019 shortfall, which is about $6.1 million, according to the lawsuit.

The shortfalls at this point total $10,545,701, according to the lawsuit, "which amount EPC anticipates will increase by almost $7,000,000 once calendar year 2020 concludes."



'Lavish lifestyle': A lawsuit filed against Think Loud, Hynes and Live members by UFD and Louis Appell III alleges Hynes used UFD as his "personal piggy bank" when he was CEO to fund a lavish lifestyle he couldn't otherwise afford.

"This unlawful pattern of misconduct included the outright theft of Company funds, fraud, and persistent self-dealing," the Appell/UFD lawsuit states.

More:Appell, United Fiber & Data sue Live band members and felon who is former CEO

More:Think Loud sues York philanthropist's son over control of fiber optic company

More:Bill Hynes resigns as CEO of York's United Fiber & Data; more details on criminal charges

The Appell/UFD lawsuit alleges Hynes has repeatedly lied, and continues to do so, to cover up the theft.

"Hynes' unlawful pattern of misconduct also involved his causing the Company to enter into various transactions that had absolutely no legitimate business purpose, especially given that the Company was a startup with very little cash," the lawsuit states. "All of these illegitimate actions were intended to result in a material benefit to Hynes or his co-conspirators."

Hynes is a felon, having been convicted of theft by deception in 2010 in Northampton County.

Appell III is the son of the late York philanthropist Louis Appell Jr. — who invested millions of dollars into UFD before his death — and inherited his father's stake in the company.

— Reach senior crime reporter Liz Evans Scolforo at levans@yorkdispatch.com or on Twitter at @LizScolforoYD.

https://www.yorkdispatch.com/story/news/loc...own/5969205002/

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United Fiber & Data sued by Allentown-based company, alleges $10.5 million owed
Neil Strebig | York Daily Record | October 14, 2020

An Allentown-based real estate company has filed suit against York-based United Fiber & Data claiming breaches in multiple contracts.

The lawsuit filed by EPC LLC on Friday in Lehigh County alleges that United Fiber & Data broke a lease and forbearance agreement with the company and owes $10.5 million.

"We don't have any comment on pending litigation matters," UFD president and general counsel Andrew Paxton said.

According to the suit, UFD occupied offices at 832 Hamilton St. in Allentown, a building constructed by EPC, an affiliate of Alvin H. Butz Inc. UFD signed a 20-year lease to occupy the space beginning in 2013.

The Hamilton Street building is located at the Butz Corporate Center, a notable site of redevelopment in downtown Allentown. The site is a designated Neighborhood Investment Zone. Such zoning provides tax and business incentives to attract businesses to the area and spur economic development.

“EPC Allentown is a partnership of Butz family members that owns Butz Corporate Center. UFD remains a tenant in the building, but we don’t discuss lawsuits," Greg Butz, CEO and president of Alvin H. Butz, said in a statement.

According to the lawsuit, “the NIZ affords developers the ability to fund their projects using tax dollars generated by tenants.” Such zones have generated more than $600 million in development in Allentown, the lawsuit reads.

The lawsuit alleges that Think Loud Investments was awarded a $5 million promissory note in May 2013, and both Think Loud and UFD have broken a forbearance agreement with EPC.

In part of the NIZ agreement and lease, portions of tax revenue generated by UFD would be paid to EPC. In the lawsuit, EPC is alleging that UFD owes over $10.5 million in payments from 2018 to 2019. EPC expects an additional $7 million will be accrued by the end of the year, the lawsuit states.

UFD has been tangled in several lawsuits recently, including a recent suit against former CEOs and founders Bill Hynes and Chad Taylor.

Taylor, along with former Live bandmates Chad Gracey and Patrick Dahlheimer, formed Think Loud Investments, along with several affiliates, including Think Loud Development and 120 York LLC. Taylor, Gracey, Dalheimer and Hynes own about a 40 percent stake in United Data & Fiber through their holdings with Think Loud and BKS Capital.

Attorney Jason Confair, who represents 120 York LLC and Think Loud offered this statement via email:

“To be clear, EPC’s suit seeks payment from UFD for NIZ tax credits that UFD was supposed to generate. Although the various transactions referenced in the EPC complaint are related, the heart of the lawsuit is quite simple – UFD failed to generate NIZ credits to pay its rental obligations.

Indeed, EPC does not name any member of Live, any entity-affiliate of Live, or Mr. Hynes as a defendant in the lawsuit. By the time EPC filed suit, over four years had passed since Mr. Taylor, Mr. Gracey, and Mr. Dahlheimer were actively involved in UFD’s management, and one year had passed since Mr. Hynes was actively involved."

United Fiber & Data started in 2012 and announced in 2013 plans to build a 340-mile dark fiber optic line from New York City to Ashburn, Virginia. When the company first launched, UFD announced plans to build data centers in York, Allentown, Reading and Lancaster. Currently, the company is aiming to build a data center in York at the former York County Prison.

Read the lawsuit below:

<visit link to read lawsuit>

Neil Strebig is a journalist for the York Daily Record and curator for the York on the Move newsletter. He can be reached at nstrebig@ydr.com, 717-825-6582 or via Twitter @neilStrebig.

https://www.ydr.com/story/news/2020/10/14/e...ata/3649405001/

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This may result in Think Loud studios being sold.

Kinsley Construction moves in court to have Think Loud building put up for sheriff's sale
Kinsley Construction on Sept. 17 obtained a more than $13.94 million judgment against 120 York LLC, which owns the building at 210 York St. and contains the offices of Think Loud Development and United Fiber & Data.

Dylan Segelbaum | York Daily Record | October 14, 2020

Kinsley Construction has moved to have the building that contains the offices of Think Loud Development and United Fiber & Data put up for sheriff’s sale to satisfy a more than $13.94 million judgment and interest.

Paul Minnich and Scott Landis, Kinsley’s attorneys, on Tuesday filed for a writ of execution in the York County Court of Common Pleas. The construction firm obtained the judgment on Sept. 17 and alleges that 120 York LLC, the company that owns the building at 210 York St., defaulted on a note and mortgage.

120 York’s general counsel, Jason Confair, could not be reached.

“We take great pride in the work our team has performed for the Think Loud organization, including providing design and construction services to return the 210 York Street complex to active use, but we cannot comment on the pending litigation," Kinsley said in a statement.

READ:Live from 'S--- Towne': Rock stars returned to build better York, but promises unfulfilled

Gov. Tom Corbett’s administration awarded a total of $7 million from the Redevelopment Assistance Capital Program for the 210 York St. project, which included renovating the 53,000-square-foot warehouse that used to house Bi-Comp, a printing company.

The state has paid more than $3.38 million to reimburse for construction costs, according to the Office of the Budget.

The York County Board of Commissioners awarded a 10-year tax break to the property, and York City Council later adopted an ordinance closing off York Street to the public.

RELATED:Here’s what we know about United Fiber & Data founder and former CEO Bill Hynes

Three members of the multi-platinum-selling rock band Live — Chad Taylor, Chad Gracey and Patrick Dahlheimer — and their friend and business partner, Bill Hynes, own and control 120 York, according to court documents. The building also contains a state-of-the-art recording studio.

United Fiber & Data, the Powder Mill Foundation and Louis Appell III, the son of the late businessman, philanthropist and civic leader Louis Appell Jr., filed a lawsuit last week in York County.

The lawsuit alleges that Hynes, the founder and former CEO of United Fiber & Data, engaged in a “straightforward and blatant act of theft” and stole the more than $3.38 million that the state had reimbursed.

Hynes, 48, of York, a convicted felon who’s awaiting trial on charges of burglary, forgery, stalking and related offenses, is free on $50,000 bail and expected back in court on Oct. 21. He denies the allegations.

ALSO OF INTEREST:Think Loud's big white York Street building serves as symbol of change in York, Pennsylvania

United Fiber & Data started in 2012 and built a 340-mile fiber-optic line connecting New York City to Ashburn, Virginia, a suburb of Washington, D.C.

"UFD does not comment on litigation to which it is not a party," said Andrew Paxton, president and general counsel of United Fiber & Data.

The business has boasted that it would create more than 300 jobs and generate over $2 billion in state tax revenue in 30 years in Pennsylvania. But it seems that the startup has not lived up to its own hype.

Contact Dylan Segelbaum at 717-771-2102.

https://www.ydr.com/story/news/watchdog/202...ale/3649427001/

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Sheriff's sale of Think Loud building - tied to members of rock band Live - is postponed

The building is wrapped up in a separate ongoing legal battle over control of United Fiber & Data, a telecommunications company in York.
Dylan Segelbaum | York Daily Record | Published 8th February 2021

A four-story building that's connected to members of the multi-platinum-selling rock band Live and part of a project that received millions of dollars in taxpayer money to help revitalize York will not be sold at sheriff’s sale — for now.

In September, Kinsley Construction obtained a $13.94 million judgment against 120 York LLC, which owns the building at 210 York St. near PeoplesBank Park, home of the York Revolution. The property is 53,000 square feet and features a sign that reads "Think Loud" in black letters.

Later, Paul Minnich and Scott Landis, Kinsley's attorneys, moved in court to have the building sold at sheriff's sale, which was scheduled to happen at 2 p.m. on Monday.

But earlier in the day, the York County Sheriff's Office reported, Kinsley's counsel sent a fax asking for the sale to be postponed until April 5. The request did not include an explanation.

The general counsel for 120 York, Jason Confair, declined to comment.

The building contains a state-of-the-art recording studio as well as the offices of United Fiber & Data, a telecommunications company that’s built a 340-mile fiber-optic line connecting New York City to Ashburn, Virginia, in the suburbs of Washington, D.C.

Court documents state that the members of 120 York are Chad Taylor, Chad Gracey and Patrick Dahlheimer, the lead guitarist, drummer and bassist for Live, respectively, and their friend and business partner, Bill Hynes. They're also investors in United Fiber & Data.

Gov. Tom Corbett’s administration pledged a total of $7 million from the Redevelopment Assistance Capital Program to what was called the 210 York St. project, which included renovating the building. The state has paid out more than $3.38 million to reimburse for construction costs, according to the Office of the Budget.

The York County Board of Commissioners awarded a 10-year tax break to the property. York City Council adopted an ordinance closing off York Street to the public.

The building is wrapped up in a separate ongoing legal battle over control of United Fiber & Data, which boasted that it would create more than 300 jobs and generate in excess of $2 billion in state tax revenue in 30 years in Pennsylvania.

For instance, one side alleges that United Fiber & Data has "abandoned" its offices inside the building. Company executives, though, dispute that assertion.

Contact Dylan Segelbaum at 717-771-2102.

https://www.ydr.com/story/news/watchdog/202...ned/4397328001/

[Bremang]

For whatever reason, I wasn't able to find the court records online for these cases. Maybe someone else could try.

Also, seems like Live might lose the building in either the lawsuit, or the sheriffs sale. On one hand, sounds like losing Think Loud studios is going to play a role in preventing new Live music being released.

On the other hand, if they ever do put out new music, maybe they have to find a new studio and it just so happens to include a producer other than Chad Taylor.

[andymbj]

On the other hand, if they ever do put out new music, maybe they have to find a new studio and it just so happens to include a producer other than Chad Taylor.

Win

[JonSnow]

For whatever reason, I wasn't able to find the court records online for these cases. Maybe someone else could try.

Also, seems like Live might lose the building in either the lawsuit, or the sheriffs sale. On one hand, sounds like losing Think Loud studios is going to play a role in preventing new Live music being released.

On the other hand, if they ever do put out new music, maybe they have to find a new studio and it just so happens to include a producer other than Chad Taylor.

Maybe they can move back into that old 19th century bank they used to use as a rehearsal space and storage space for their equipment...

...if for no other reason than inspiration.

[Bremang]

Chad's main focus is Bitcoin

This post has been edited by Bremang: Feb 18 2021, 3:46 am

[+Ed+]

And to love... Bitcoin
And to fear... Bitcoin

[+Ed+]

Oooh baby, let Bitcoin ease your pain

[Bremang]

cmon baby leave some coin behind

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United Fiber & Data exploring 'transaction alternatives' — including a potential sale

In a letter to investors, Christopher Lodge, chief operating officer and interim CEO of United Fiber & Data, wrote that other possible options include raising additional capital or evaluating acquisitions or mergers.
Dylan Segelbaum | York Daily Record | Feb 25, 2021

The management of United Fiber & Data, a telecommunications startup in York that’s connected to members of the multi-platinum-selling rock band Live, is exploring whether “feasible strategic transaction alternatives” exist, including a potential sale of the company.

In a letter to investors dated on Nov. 24, 2020, Christopher Lodge, chief operating officer and interim CEO of United Fiber & Data, wrote that management was interviewing “experienced and expert investment banks groups” to look into whether there are options such as raising additional capital, evaluating acquisitions or mergers, or selling the company.

The document was attached as an exhibit to a recent court filing in Lehigh County in litigation related to the control and fate of United Fiber & Data.

If the experts recommend that a transaction is not in the best interest of the business or its unitholders at this time, he wrote, the company should be in a “strong position to not proceed.” But if they suggest going forward, that’s an option.

“It is our view that it is far better to carefully rely on the advice of experts than to act impulsively,” Lodge wrote. “Too much is at stake to do otherwise.”

United Fiber & Data built a 340-mile fiber-optic line that connects New York City to Ashburn, Virginia, a suburb of Washington, D.C., which is targeted at businesses with a large need for connectivity. The startup has boasted that it would create more than 300 jobs and $2 billion in state tax revenue in 30 years in Pennsylvania.

The president and general counsel of United Fiber & Data, Andrew Paxton, said “we wouldn’t provide public comment on internal matters” of the company.

Lawyers for Think Loud Holdings LLC and BKS Capital LLC, Jason Confair, Philip Bowman and J. Michael Eakin, either declined to comment or could not be reached.

Members of those entities include Chad Taylor, Chad Gracey and Patrick Dahlheimer, the lead guitarist, drummer and bassist of Live, respectively, and their friend and business partner, Bill Hynes.

They’ve asked for various relief in court, including for a judge to appoint an independent receiver to liquidate the assets of United Fiber & Data at the highest offer. In his letter, Lodge draws a contrast to that approach.

“The Company hopes that the current litigation can be resolved,” Lodge wrote, “and that the Company will grow in value for its investors.”

Contact Dylan Segelbaum at 717-771-2102.

https://www.ydr.com/story/news/watchdog/202...ale/4515011001/

[Merica]

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Allentown company obtains $5.93 million judgment against United Fiber & Data

“We believe the judgment is defective in several regards, and intend to have it opened and/or stricken,” said Zachary Cohen, United Fiber & Data’s attorney.
Dylan Segelbaum
York Daily Record - June 9, 2021

An Allentown company has obtained a $5.93 million judgment against United Fiber & Data, a telecommunications startup in York that’s connected to members of the multi-platinum-selling rock band Live.

United Fiber & Data built a 340-mile fiber-optic line that connects New York City to Ashburn, Virginia, a suburb of Washington, D.C. The firm has boasted that it would create more than 300 jobs and generate over $2 billion in state tax revenue in 30 years in Pennsylvania.

EPC-Allentown LLC obtained the judgment on June 3 in the Lehigh County Court of Common Pleas. It’s the latest in a number of legal developments surrounding the telecommunications company.

“We believe the judgment is defective in several regards, and intend to have it opened and/or stricken,” said Zachary Cohen, United Fiber & Data’s attorney.

RELATED:Live from 'S--- Towne': Rock stars returned to build better York, but promises unfulfilled

In 2013, EPC entered into an agreement and loaned $5 million to an entity related to United Fiber & Data to develop an office building in Allentown that’s in a special tax district called a Neighborhood Improvement Zone. But the firm and others failed to pay the principal and interest owed under the promissory note, according to court documents.



EPC agreed to hold off going after United Fiber & Data in 2016 if it satisfied certain conditions, court documents state.

But in 2020, EPC sent written notice to United Fiber & Data demanding that it pay $5.81 million by the end of the year — which, court documents state, didn’t happen.

In a separate lawsuit, EPC alleges that United Fiber & Data breached the terms of the forbearance agreement. The case is pending.

CHECK OUT:United Fiber & Data exploring 'transaction alternatives' — including a potential sale

Meanwhile, 120 York LLC, a company that owns a four-story building in York containing the offices of United Fiber & Data, recently filed for bankruptcy.

Kinsley Construction previously obtained a $13.94 million judgment against 120 York and moved to have the property put up for sheriff’s sale. The building is on York Street near PeoplesBank Park, home of the York Revolution, and has a sign on the front that reads “Think Loud” in bold, black letters.

The founder and former CEO of United Fiber & Data, Bill Hynes, who’s awaiting trial on charges of burglary, forgery, stalking and related offenses, is due back in court on June 22 for a status hearing.

MORE:United Fiber & Data has 'abandoned' its offices in the Think Loud building, lawsuit claims

Contact Dylan Segelbaum at 717-771-2102.

https://www.ydr.com/story/news/watchdog/202...nty/7622674002/

[Bremang]

Shinn's money down the drain