|Mercantile hits road blocks in NTG drama||
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NTG Press Coverage Summary
By Larry Rulison, BBJ Staff
Going after Michele A. Tobin's money has not been easy for Mercantile-Safe Deposit & Trust Co.
The bank claims Tobin personally guaranteed a portion of $3.5 million in loans Network Technologies Group Inc. never repaid before it collapsed July 13 amid accusations of accounting irregularities. Mercantile got a $713,629 judgment entered against Tobin, the Fells Point technology firm's former CEO, on July 8 in Baltimore County Circuit Court.
But collecting the money has been difficult for the bank because Tobin's Washington lawyers have contested the judgment in a series of legal maneuvers.
Baltimore County Circuit Court Judge Ruth A. Jakubowski ordered the judgment opened on Sept. 20 — essentially deciding to give the case further review — saying "there is a substantial and sufficient basis for an actual controversy as to the merits" of the case.
And on Oct. 9, Tobin's attorney, Monique D. Almy of Swidler Berlin Shereff Friedman LLP, filed court papers denying most of the claims Mercantile made in its original July 5 complaint. Mercantile will not comment on the case.
The behind-the-scenes posturing by Mercantile and Tobin are just the latest moves in the NTG case, which received widespread attention this summer when the company's interim CEO, John M. Collard, shut the company down and laid off all 125 workers.
Collard, an Annapolis turnaround consultant, was hired by the NTG board July 1 to turn the struggling company around after the departure of Tobin, one of the firm's co-founders.
But after only several days on the job, Collard said he uncovered alleged accounting irregularities in the company's books. Collard has said that the company misled Mercantile and investors such as the Abell Foundation about its financial condition by inflating its balance sheet.
Tobin, who sold her Baltimore County home in August, is believed to be living in Colorado where she has a home near the resort town of Vail.
Almy, Tobin's lawyer, has not responded to repeated requests for interviews.
Mercantile originally also sought money from Victor Giordani Jr., one of the co-founders with Tobin, and Daniel P. Welsh, another top NTG executive, saying both men and their wives had signed personal guarantees for the NTG loans along with Tobin.
However, the Giordanis and the Welshes claim that their signatures were forged on the loan documents, and now Mercantile is only pursuing Tobin for her portion of the $3.5 million in loans.
NTG sold all of its remaining assets at auction in August. Collard said the sale generated approximately $1 million in proceeds that was used to pay off a portion of the Mercantile loan.
Other investors, however, including the Abell Foundation, will never recoup their investment since they owned only equity in the company, now worth nothing.
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