Latest Invest NI FOI Response

Just received an update to my Invest NI freedom of information request. This included a copy of the Terms and Acceptance by Cargo IO (BrewBot). Just started reading this and will likely have another follow up with them regarding what appears to have been an important clause regarding business operations and a potential breach of contract (to be determined).

Anyone interested in learning more?

"Refunds" are possible

Have been away for a bit on Holiday, but want to get some further information out to those that are watching this blog.

While many have been patiently and impatiently waiting for Chris to deliver a BrewBot to them, many others have been asking about refunds or assumed that their money is lost.

I started emailing Chris in December, 2016 to see if after three years something factual could finally be shared and will post that email chain soon. I'm speculating, but it appears that the creation of this blog and posts on the Kickstarter and BrewBot Forums put some pressure on Chris to re-engage with the backers, but he still never delivered anything other than weak "news coming soon" type content.

While not specifically asking for one, I was eventually offered a refund by Chris, payable via Paypal, in installments over several weeks (obvious cash flow issues!). I accepted his offer and eventually received a total of approximately $1,750 of the $2,500 (USD) that Kickstarter removed from my account on October 22, 2013. Unfortunately, due to currency fluctuations, the value of my pledge in USD is now less than the GBP pledge amount of 1,500.

Brewbot and Kickstarter now believe that they have refunded me and my access to the forums has been revoked.

I disagree and will continue to pursue a refund in full, BrewBot and Kickstarter accountability, and perhaps some real answers for the backers on what happened, and what the plans are for BrewBot.

Brewbot Forum Down?

Anyone able to log into the forum for Brewbot? I get a redirect too many times error and wondering if it is me or a system-wide failure. I can view the main website and backer info -just appears the forum is down.
Post your reply in the comments below (Success or Down Too!).
Thanks

Yes, Chris did post an update...

I do plan to have a full posting later this week about my email conversations with Chris that started late last year (and subsequently led to my starting this blog).

Before I repost his forum update, I just read this interesting and thought provoking article on Inc.

http://www.inc.com/quora/1-simple-question-you-should-always-ask-to-catch-a-liar.html

FYI - He may be referencing this blog in his posting. To date, I have not seen or received any direct communication from Chris requesting anything posted/emailed to remain confidential. To the potential investors that he mentions: What content of this blog is new information that you did not uncover during your normal due diligence process? I would be surprised if you were not privy to more information (including non-public financials) than I've been able to discover and share. Also, an open invite to any investor/prospect to contact me - even confidentially.

Now to Chris (reprinting in full):

chrismcclelland

3d

Hi everyone,
Fundraising
It has been a positive couple of weeks. We have some new funds interested and pleased to say we have some committed money due March .
There is still work to do to bank this, and we need more but it is a step in the right direction.
One of the key meetings this month got postponed, hoping that will bring further good news.
Data
As mentioned in our last update we have been collecting the data necessary to support ongoing due diligence as part of the current funding round. While we'd love to share some of it the timing is not right especially as it may end up in the public domain.
We've already found this to be a liability and has had a negative impact on our funding efforts. Potential investors are extremely sensitive to information leakage and expect confidentiality to maintained.
It's also sucked up valuable days, legal costs and advisor time.

---

So I urge you all, please hang tight. We are able to produce these machines. And we're working hard to get everyone brewing.

---

P.s.
I know some of you follow the progress of the bar. There is a new wine bar opening upstairs. A couple came with an idea to utilise the space, so we are letting them run with it. We are hoping it will help with sustainability.
__
As always, any questions let me know.

Invest NI Request Response

Chris from BrewBot has promised an update today regarding the cancellation of the January Town Hall and the "January 31 is a deadline for a funding conversation and should know more about a couple of other options."

This AM I received the attached response to an initial request from Invest NI. I have some follow up questions in to them and I have a couple of significant posts in draft for release next week.

Stay tuned here and the forum for Chris' promised update...

===================

                                                                                                                       

Mr Ken Koch Brewbot.answers@gmail.com	Invest Northern Ireland  Bedford Square  Bedford Street  BT2 7ES
	Telephone:	028 9069 8427
	Email:	john.miller@investni.com
	Our Ref:	FOI 978
	Date  3rd February 2017
Dear Mr Koch
Freedom of Information Act 2000

I can confirm that Invest NI has now completed its search for the information which you requested on Wednesday 11^th January 2017.

Was the [Brewbot] funding a cash grant, services or combination?

Between 2013 and 2017 Invest NI offered Brewbot a range of financial support (grants) towards R&D, market research and export activity.

Brewbot also received investment in 2014 through Techstart NI, an independently managed Invest NI Access to Finance fund.

A total of £ 88,257 was offered in assistance of which £ 43,973.30 has been drawn down.

Were there specific milestones/deliverable and if so were they met as part of this?

As with all Invest NI support, funds are only released on completion of key activity/delivery against agreed milestones, as set out in our Letter of Offer.  All claims to draw down against offers are vouched against these agreed milestones before funds are released.

Did Invest NI receive any value from this? (such as a share of BrewBot)

Invest NI has not received a share in Brewbot in return for grants offered.

The TechstartNI investment was part of the $1.5m investment round which has not yet resulted in any of these investors receiving shares in the company.

Were any intellectual property rights developed, owned or transferred to BrewBot as part of this engagement?

Invest NI did not obtain or transfer any Intellectual property rights as part of its engagement with Brewbot.

If you feel that the information we have provided does not fully meet your request please contact me on 028 9069 8427 in the first instance. You have the right to request a formal review by Invest NI within two calendar months of the date of this letter and if you wish to do so, please write to the Information Governance Manager, Bedford Square, Bedford Street, Belfast, BT2 7ES or email ‘foi@investni.com’.

If after such an internal review you are still unhappy with the response, you have the right to appeal to the Information Commissioner’s Office, Wycliffe House, Water Lane, Wilmslow, Cheshire, SK9 5AF, who will undertake an independent review.

If you have any queries about this letter, please contact me. Please remember to quote the reference number above in any future communications.

Yours sincerely

John Miller

Client Manager

Fiduciary Duty

Here is another bit if information/education for us on my investigative quest. Again, this is still primarily US based, unless noted, at this time.

A fiduciary duty is the highest standard of care.  The person who has a fiduciary duty is called the fiduciary, and the person to whom he owes the duty, is typically referred to as the principal or the beneficiary. If an individual breaches the fiduciary duties, he or she would need to account for the ill-gotten profit. His or her beneficiaries are entitled to damages, even if they suffered no harm. 

1. Corporations and Fiduciary Duty

In discussing corporate fiduciary duties, it is very helpful to refer to the corporate law of Delaware. More than half of publicly traded companies are incorporated in Delaware.  Nonetheless, corporations incorporated in other states (ed.: or Countries) may be bound by different rules and obligations.  (BrewBot has/had a US based company or operating corporation but as of yet, I've not been able to find accurate filing information beyond a cold trail in Texas.)

Directors of corporations, in fulfilling their managerial responsibilities, are charged with certain fiduciary duties.  The primary duties are the duty of care and the duty of loyalty.

• Duty of Care: This duty requires that directors inform themselves “prior to making a business decision, of all material information reasonably available to them.”  Whether the directors were informed of all material information depends on the quality of the information, the advice available, and whether the directors had “sufficient opportunity to acquire knowledge concerning the problem before action.”  Moreover, a director may not simply accept the information presented.  Rather, the director must assess the information with a “critical eye,” so as to protect the interests of the corporations and its stockholders. (Per filings, Chris McClelland is the sole Director of BrewBot)
   
• Duty of Loyalty: As the Delaware Supreme Court explained in Guth v. Loft, 5 A.2d 503, 510 (Del. 1939): “Corporate officers and directors are not permitted to use their position of trust and confidence to further their private interests. . . . A public policy, existing through the years, and derived from a profound knowledge of human characteristics and motives, has established a rule that demands of a corporate officer or director, peremptorily and inexorably, the most scrupulous observance of his duty, not only affirmatively to protect the interests of the corporation committed to his charge, but to refrain from doing anything that would work injury to the corporation, or to deprive it of profit or advantage which his skill and ability might properly bring to it, or to enable it to make in the reasonable and lawful exercise of its power.”

Additionally, courts have imposed the following duties:

• Duty of Good Faith: Requiring the director to advance interests of the corporation, not violate the law, and fulfill his or her duties.  For a thorough discussion of this duty, see In re The Walt Disney Co. Derivative Litig., 906 A.2d 27 (Del. 2006).
   
• Duty of Confidentiality: Required directors to keep corporate information confidential and not disclose it for their own benefit.  Consult Guth v. Loft, Inc., 5 A.2d 503 (Del. 1939) for more information.
   
• Duty of Prudence: Requires a trustee to administer a trust with a degree of care, skill, and caution that a prudent trustee would exercise.  Consult Amgen Inc. v. Harris, 136 S. Ct. 758 (2016) for more information.
   
• Duty of Disclosure: This duty requires directors to act with “complete candor.”  In certain circumstances, this requires the directors to disclose to the stockholders “all of the facts and circumstances” relevant to the directors’ decision.

These duties do not mean, however, that the court will always impose its own review over directors’ decisions.  Under the “business judgment rule” the court presumes “that in making a business decision the directors of a corporation acted in an informed basis, in good faith and in the honest belief that the actions taken was in the bests interests of the company.”  Under this rule, courts will generally refrain from questioning the directors’ judgment so long as their judgment can be attributed to some rational corporate purpose.

How do the Laws in Belfast differ? Still researching the similarities and differences...keep watching the blog for further updates.

Misc Items

FYI - Chris posted on the BrewBot forums yesterday:

Thanks for the comments.

1. 3rd February is realistic. January 31 is a deadline for a funding conversation and should know more about a couple of other options.
2. The two SF units are being reviewed by mid-week. From there we will know what needs to be done. Need to allow weeks.
3. Yes we can build these, we have not run out of options.

Any other questions let me know.

Thanks,

Chris

I've been looking into Kickstarter and foreign currency fluctuations.  A graph that shows the "value" of the GBP versus USD since the Kickstarter campaign has ended.