July 28, 2011
Dallas TX – The Ashcroft Law Firm has been retained by Ken Barton, one of the founders of RPost, to pursue corporate fraud and malfeasance claims against the company which he established in 1999. John Ratcliffe, former U.S. Attorney for the Eastern District of Texas, will lead the Ashcroft team’s effort to support Barton’s existing lawsuit against RPost in Los Angeles and to pursue additional claims arising from ongoing investor fraud by various RPost principals and board members.
“Our firm has considerable experience with ensuring that companies are held accountable to their shareholders for damages arising from the misdeeds of executives charged with corporate governance and oversight, and we look forward to assisting Mr. Barton in enforcing his rights as a founder and shareholder of RPost,” said Mr. Ratcliffe, now a partner in the Ashcroft Law Firm’s Dallas, Texas office.
Barton’s current lawsuit against RPost, which is pending in Los Angeles Superior Court, alleges a complex financial fraud scheme whereby members of RPost’s management team have siphoned off many of RPost’s assets to new, insider-controlled Bermuda entities. Barton’s suit alleges that, without disclosure to and approval from RPost’s shareholders, RPost’s principals secretly transferred $750,000 out of RPost’s accounts to another Bermuda entity, Rmail Limited (“RMail”), which had been formed by two of RPost’s directors to “acquire” patents which investors had long understood would be assets of RPost. According to the complaint, certain RPost executives created an agreement where RPost would pay the insiders’ new Bermuda company a fee for the license for RPost to use the very RPost assets wrongfully and secretly transferred to RMail.
According to Barton’s complaint, RPost executives have further perpetuated this fraud scheme by misrepresenting and grossly overstating RPost’s annual revenues to prospective investors and the public. During a 2007 interview with RPost CEO Zafar Kahn, The LA Business Journal stated that the company “sees annual revenue short of $10 million.” (See http://www.rpost.com/news-and-events/press-room/media-coverage/280) when in fact, RPost’s annual revenue for 2006 was less than $200,000. RPost has continued to utilize this false representation in its ongoing marketing efforts to raise additional capital. Since 2004, RPost has been backed by global technology leader Symantec Corporation (SYMC), which invested over $1 million into RPost, supplanted Mr. Barton on RPost’s Board of Directors from at least 2004-2008 and presently maintains the right to hold a seat on the RPost Board of Directors.
Barton is just one of several shareholders asserting that principals and other executives of RPost are engaged in a complex scheme to steal shares of stock, siphon off company assets through illegal transactions and transfers, misrepresent earnings in public disclosures and raise capital based upon false financial statements. In addition, the company currently faces other claims of corporate fraud, illusory corporate governance and a blatant assault on shareholders’ equity and rights.
The Ashcroft Team will lend its significant experience leading federal organizations, conducting investigations and working closely with federal and local regulatory authorities to Mr. Barton’s current legal team.
Background on RPost
RPost, which stands for “Registered Post,” was founded by Barton along with current CEO Zafar Khan and Dr. Terrance Tomkow. Originally, RPost’s business was premised on providing a new tool for conducting business safely over the Internet. RPost’s Registered Email® services were designed to create nearly instantaneous proof of delivery, content and receipt of important email communications that companies and individuals could rely upon in a global business environment where every minute can prove to be critical. The company created early momentum when former U.S. Postmaster General, Marvin Runyon, agreed to bring his valuable direction and oversight as a member of RPost’s Board of Directors.
Since 2007, RPost has engaged the accounting firm Kabani & Co. Inc. to audit RPost’s financial condition. Kabani and Co. is the subject of intense international regulator attention for cases unrelated to RPost.
About the Ashcroft Law Firm
With decades of public service and business expertise, the Ashcroft Law Firm has worked extensively with leaders in the corporate world and international community, as well as with officials and advisors in the top levels of state, federal and foreign governments. These experiences have formed a deep knowledge and extensive network that directly benefit their clients in each of their engagements. From leading prosecutions as U.S. Attorneys to providing resolution strategies on thousands of individual and mass tort cases, the team has litigated claims in excess $21 billion in actual settlements paid.
http://www.ashcroftgroupllc.com/ourteam/john-ratcliffe/
Legal inquiries should be directed to the Ashcroft Law Firm at 816.285.7600.