Last week, it was reported that negotiations between Groupe Bernard Tapie, Full Tilt Poker and the U.S. Attorneys Office, SDNY, had been formally terminated. It had been reported for months that the deal between the three would have allowed the forfeiture of assets of the FTP companies to the US DOJ, and the eventual resale of those assets to GBT, culminating in the (re)launch of the “New Full Tilt Poker” and the repayment or otherwise “making whole” of rest of world player’s account balances via the new site. We know now that that scenario is no longer a possibility.
The information that the “deal” had died was initially leaked by an anonymous poster on the twoplustwo poker forum, and once it picked up considerable interest and comments, Mr. Laurent Tapie, who had been the negotiator for GBT, issued a media release, published widely among the poker community, with his explanation of what happened and why. Included in that media release was Mr. Tapie’s statement:
“For that reason, unless a concrete and legally viable solution is found in the very coming days to save the employees and repay the players of FTP, we will move to our own plan of action.”
Hours before that statement was released however, Tapie had already started to put part of his “plan of action” into motion. Early Tuesday morning, he emailed the “key” employees of FTP. That email appears below: 1
From: laurenttapie (private email address of Laurent Tapie redacted by diamondflushpoker) On Behalf Of laurent tapie Sent: 24 April 2012 09:51 To: (Names of 16 email recipients/employees redacted by diamondflushpoker) Subject: Message from Laurent Tapie
This message is addressed to the key staff of FTP. I don’t have the e-mail address of all people within the key staff : (Names of 14 additional employees redacted by diamondflushpoker) and other people of key importance are not in my list, but this message is also addressed to them :
Considering the work we have been doing together to relaunch FTP over the last 7 months, I feel it is my duty to inform you on the current situation, and my plan, before I release a press statement in the coming hours.
The deal with DOJ is off, and the negotiations are terminated. Ultimately, DOJ refused to accept GBT’s proposal for repayment of the ROW players – a proposal that we thought had been accepted – and, on 14 April 2012, informed my lawyer that they could only agree on an agreement where GBT would repay 100% of the 184M$ value of ROW players balance in a maximum of 90 days.
That clearly made the deal unworkable. And I believe no one would accept such terms.
I continue to believe that our plan for repayment was fair. We would have made all ROW players’ balances available for play on the relaunched site immediately. Furthermore, we would have repaid (allowed withdrawal of funds for) 94.9% of ROW players day 1, 4.9% of ROW players in 18 months and only 0.2% of these players in more than 18 months, with a maximum of 5 years for the very large balances. In addition, we agreed to a DOJ proposal to allow ROW players to submit petitions to the DOJ for compensation as well, and agreed both to reimburse DOJ for those players and to compensate those players for any amounts DOJ did not reimburse.
According to (finance employee’s name redacted by diamondflushpoker) last report, PK has enough funds to pay the april salaries but not May.
Therefore, as an alternative to the purchase, I offered Ray Bitar to license the assets on a temporary basis, in order to relaunch the site, preserve the value of the assets and participate in an eventual auction as a bidder in the future.
Ray required DOJ’s aproval to do this. My own understanding of the situation was different : I thought that since the companies were clearly in insolvency, as a legal representative Ray should have immediately accepted this licensing offer which was the only concrete offer to preserve the jobs, the cash, and the value of the assets of the companies. Futhermore the DOJ is not the owner of the assets until it decides (if it ever decides) to forfeit them.
But Ray stayed on its position that DOJ’s aproval was necessary.
So we made the offer to DOJ but despite our best efforts, and with no surprise on my side, DOJ was unmoved and, on 20 April 2012, reaffirmed that its decision was final, that no licensing agreement of any kind would be accepted by them, and that our negotiations were ended.
I met Ray last friday and suggested him to place the companies into insolvency in each of the countries where they are (my understanding of the situation is that he legally should), and inform the staff that he can no longer guarantee their jobs.
Considering he has always required US DOJ’s aproval before taking any decision for the last 7 months I have been observing him, I don’t know if he has or if he will.
But on my side, I am unwilling to allow 7 months of effort to go to waste, to see 200 employees lose their jobs and to witness former FTP players around the world go unpaid.
For that reason, I have decided to devote a significant portion of the funds that I was planning to use for the acquisition of the FTP assets instead to launch my own company, under the auspices of Game Cubed, the company I have created in Ireland. I will do this only if I can attract ALL OF the Pocket Kings KEY STAFF to join me. With your help and know-how, we will launch a new website that will be best of breed in 6-7 months.
I know that any such step requires a leap of faith, so here is my offer: as of May 1, I will hire the entire Pocket Kings key staff – every single one of you – at your current salaries and with your accumulated benefits intact. I also will include stock options in the new company, so that weall will share in what I believe to be the exciting upside this opportunity represents.
We will write a new poker software platform based on your knowledge and relaunch using a new brand, with an offer to former FTP ROW players that will allow them to recover their lost balances if they come to our new site, just as we had planned in our agreement with DOJ.
I have the money to make this happen and am working with the Alderney licensing authorities on obtaining a license and getting their help on the repayment plan.
I am also negotiating with Poker Strategy to resurrect an affiliate arrangement similar to that which I was negotiating with FTP.
In order to make this work, I need commitments from you all very quickly. I am sorry to put this pressure on you, but timing is critical if this is to work. I need to know whether I have sufficient critical mass to move forward no later than the end of THIS WEEK.
If I do, I will schedule a meeting in Paris with the top 5-10 key peopleat the end of this week. We will take care of your travel and accomodation.
I look forward to partnering with each of you to help build the best poker site in the business.
Every employee of Pocket Kings and related companies was required to sign a non-disclosure, non-compete and non-solicitation agreement as a condition of employment. This agreement was therefore signed by the those addressed in the email. In addition, any confidentiality clause in the agreement between GBT and FTP would survive the termination of the negotiations they were executed for. Finally, during the past months and as part of his due diligence, Mr. Tapie would have had access to the employee’s signed agreements through which they are bound. To be clear however, there is no reason to believe at this time that any/all of the invited employees accepted Tapie’s offer.
Before last weekend, and, in fact, before publishing any articles on the subject of the terminated agreements, having found some statements to be somewhat disingenuous, this author reached out to Laurent Tapie for an interview. Mr. Tapie declined to comment. I then published an article bringing some additional information to the public regarding the as yet undisclosed details in the various “repayment” plans that were proposed. The next day I again solicited an interview. We were unable to come to terms on the parameters, not related to content, but because I insisted on being able to record the interview, both for my own protection and to assure complete accuracy when publishing. Not having that was a deal breaker for me, but if Mr. Tapie wants to reconsider now or in the future, my offer still stands.
- With the exception of my redactions as noted, the email is published in the exact form it was received. ↩