Collectors Universe (PSA) Settles with Real Legends

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Posted By: Bottom of the Ninth

At the conclusion of today's testimony by Joe Orlando, Collectors Universe settled before the matter was handed to the jury. Apparently Orlando was not even able to admit that PSA has a grading room. You can expect most of his testimony to be without merit. Steve Rocchi and Mike Baker's testimony over the last two days was also too damaging.

According to CU's financial statement footnotes, the suit was for $4,000,000.00, although counsel for Real Legends says they were not suing for that much. Real Legends ended up getting $600,000.00 and the public ends up getting the chance to see all court transcripts and hear what really happened with WIWAG. CU tried to get a non disclosure agreement but since they are publicly traded it was denied.

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Posted By: Richard Masson

in CLCT's 10-K, it sounded like a bogus suit. Who were the principals of When It Was A Game? What is the real story behind this action?

The footnote said the Company was being sued for introducing WIWAG to Real Legends. WIWAG was dishonest in their dealings and Real Legends suffered as a result. Why would CLCT be liable?

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Posted By: MW

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Posted By: Amy

Where can I find a copy of the transcript?

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Posted By: Og56

You should have been there. Word is Mr. Orlando told a few too many untruths. The first was that WIWAG did not have a sealing machine. It was funny that the machine that they never had was sitting in the courtroom. Also brought out was that there were thousands of unprotected holders left outside the PSA security premises. Seems to me that this was no small operation WIWAG was running. How does the FBI investigate this matter and leave the consumer in jeopardy like this? I know why PSA would do so. It is called covering your ass and to hell with the collectors that have been bilked. Let's see the spin doctors at PSA spin this one. Oh I'm sorry I forgot they never say anything to their customers, so that they might protect themselves.

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Posted By: DT

..the only spin at PSA seems to be deleting threads and members from discussing WIWAG on their chat boards. The way these guys handled this whole fiasco is truly amazing.

anybody have any links with additional info?

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Posted By: Bottom of the Ninth

http://finance.yahoo.com/q/mb?s=CLCT

By the way, the sealing machine WIWAG had been purchased about 2 years prior to their being caught. CU wants everyone to believe this was a small operation but it was anything but that. If it was an insignificant event they would have disclosed more and censured less. Worse then the crime is CU's attempt to sweep this under the carpet. They should be liable to collectors for hiding facts that directly impact on the value of their product. Not to mention the fact that collectors are still sitting on WIWAG cards and do not even know it. They were never given adequate notice on identifying WIWAG cards or all of the sources of distribution of such cards.

If you go back about a year in the link above (not that many posts), you will see one that I made in 3 parts titled Not a Dan Markel Fairy Tale. It is word for word what I was told by the FBI investigator in a 20 minute call.

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Posted By: dan mckee

WOW! Nice work Greg, very interesting, but say it ain't so.... PSA wrong doing? Joe Orlando stating untruths? Say it ain't so....

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Posted By: Og56

You would think that Joe Orlando, having graduated from law school ( Do not know if he passed the boards ) should know that it is against the law to lie under oath. If he were a member of the bar I would assume he could be disbarred. I think we can all learn a lesson from this, You can't believe a word out of Orlando’s mouth. If he will lie under oath I think he will lie to all of us.

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Posted By: John

What is this Wiwag machine PSA was busted for?
There is no Joe Orlando (or anything close) listed on the state bar website. I guess the test was too hard for him!? Or maybe it was just the ethics part he couldn't handle!? (That's a joke... just following up on the above as I am sure Mr. Orlando is very ethical).

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Posted By: JimB

I wonder if some of the obvious examples of overgrading (and I personally think they are very rare) that are presented to t his board from time to time are byproducts of the WIWAG problem.
JimB

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Posted By: DT

...that there is no real tangible way to tell the difference from a psa vs. wiwag slab job.
....same blanks and same machine.

were they printing labels too..???

are there multiple cards with the same cert #'s ??

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Posted By: PASJD

And the beat goes on. And the beat goes on.

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Posted By: Bottom of the Ninth

One of my beefs with CU after I was notified by Charlie Kahler, then head of Customer Service, was that I had two cards bought back or replaced under the restitution program and in both cases the holders had no distinguishing marks identifying them as having been previously sealed. They appeared to be fresh seals.

It was the attorney for the ins co who made them throw in the towel. CU is not going to be responsible for much if any of the 600k.

As for their stock, it will be impacted when everyone realizes that Hall and Simmons are selling over a million shares, representing 1/2 of their holdings. Think they are believers?

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Posted By: warshawlaw

or is there something you can link us to with the information?

Here is the case info: San Diego Superior Court Doc #GIC 815119

And Orlando lying on the stand? say it ain't so Joe... I'd think that by now he'd have gotten better at lying on the stand--he's had enough practice after all

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Posted By: PASJD

CLCT up another .16 so far today. An interesting claim on the Yahoo CLCT message boards about another lawsuit, and an interesting alarmist claim about the number of "bogus" cards out there as a result of the WIWAG situation.
http://finance.yahoo.com/q/mb?s=CLCT

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Posted By: MW

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Posted By: PASJD

I find it rather astonishing that two principal insiders would sell 50 percent of their holdings all at once. True, they still retain a substantial stake in the company, but nonetheless I would think it would set off alarm bells among investors to the tune of "what do they know that I don't?". I wonder if they have explained their rationale to investors. If there is an adverse disclosure on the horizon that happens after the sale goes through and it results in a significant stock price drop, it would not surprise me at all to see securities fraud class actions.

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Posted By: warshawlaw

I remember the WIWAG guys from various SoCal shows but I never had occasion to deal with them because I did not collect high end cards.

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Posted By: Lee Behrens

What do you mean? WIWAG didn't have High grade cards.

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Posted By: Judge Dred

As far as selling off the stock goes.... perhaps this is the first opportunity that they had to sell their stock (due to restrictions) and they wanted to capitalize. If this isn't the case then I'd wonder about the timing of the stock sale.

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Posted By: jay behrens

It's been a few days since I read all that stuff but I believe they announce their sale almost immediaely after the case was settle and there was announcement that a former exec is suing PSA for several million dollars. Looks like a dump done so that nothing looks improper. Now if they had unloaded all this before these two events, then people would be looking very hard at them.

Jay

Life is not a journey to the grave with the intention of arriving safely in a pretty and well-preserved body, but rather to skid in broadside, thoroughly used up, totally worn out, and loudly proclaiming --- WOW, What a ride!

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Posted By: PASJD

They have been public for years. It does not seem possible there has been a lock-up until now. I am sure other insiders have sold previously.

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Posted By: MW

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Posted By: Anonymous

Perhaps he would also care to explain why he is selling 50 percent of his shares in CLCT at this time. If I were an investor it would not inspire my confidence. I would also be interested in knowing why, if Mr. Orlando's testimony went so well, PSA paid 600K in settlement rather than letting a jury of its peers decide the case.

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Posted By: Bottom of the Ninth

Maybe Hall would like to also explain why CU's CPA firm resigned. He indicates that they released information long ago about WIWAG and the restitution program but does not acknowledge that the disclosure was inadequate and incomplete, at best. If WIWAG was using previously sealed holders to place inferior cards inside then are these holders really tamper evident as PSA claims? If they are tamper evident why was the public not given more specific details as to what to look for in these holders?

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Posted By: warshawlaw

Question authority a bit, cross that line, and uberfuhrer Hall says you are "outta here". You're fired; putz must think he's Donald Trump--of course since the Donald's company went into BK and Hall just dumped a ton of stock, maybe he's justified in feeling a bit Donaldish.

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Posted By: Judge Dred

What would happen to PSA graded material if PSA were to file bankruptcy or if they were to go out of business?

If all stated is true (CU accounting firm resigns, company personnel in the hierarchy sell their stock) what does that all mean?

Lots of interesting speculation.

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Posted By: Anonymous

Can anybody explain the WIWAG story? Were the cracking open holders and switching cards as Hall would like you to believe or, did they have their own holders made ? As far as I can tell these guys were submitting cards taking the cert tags and reslabbing completely different cards. If this is true WIWAG cards are impossible to distinguish from non WIWAG cards.

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Posted By: PASJD

Instead of arrogantly behaving as if he were on the Gong Show or the Apprentice, all Mr. Hall had to do was politely lay out the true facts to correct whatever inaccurate facts had been posted. Had he done so in a civil and respectful way, it would have been far more effective and conveyed a favorable impression of the man. Of course, noone would dispute that censorship may be appropriate in truly extreme circumstances, such as if someone had been posting child pornography. But deleting messages and threads simply because they were allegedly inaccurate, and attempting to justify it with a flippant "it's my Board and you're outta here" mantra, creates the opposite impression. Censorship only degrades the censor. I have had no real exposure to Mr. Hall before and am very disappointed that this is the man running PSA.

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Posted By: dennis

greg (Bottom of the Ninth) were you one of the posters booted off the cu message board??

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Posted By: Og56

If you ordered a train load of a 100,000 bastards,

And only David Hall got off the train,

You got more than your money's worth!

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Posted By: jay behrens

Woohoo, I got banned from the CU boards I guess they didn't like my question asking David Hall and gang to explain why they are selling off their stock.

Jay

Life is not a journey to the grave with the intention of arriving safely in a pretty and well-preserved body, but rather to skid in broadside, thoroughly used up, totally worn out, and loudly proclaiming --- WOW, What a ride!

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Posted By: dennis

so jay you are one of the 3 (fabricators).you are a bad boy!no slabs for you

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Posted By: Bottom of the Ninth

I was booted off the CU Message Boards in June 2003 for posting images of 5 cards in PSA 8 holders that I felt did not meet the centering requirements for the grade. Joe gave the directive to give me the boot as he felt I was doing this in an effort to promote GAI by putting down PSA.

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Posted By: dan mckee

Damn good reading MW. David Hall wants proof that Joe lies under oath. All he needs to do is show up at any one of the many court cases. My lawyer destroyed him with some fake Babe Ruth card that was slabbed by PSA and Joe denied knowlege of it. I never heard of the Ruth fiascal until then. I think a board member here had it.

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Posted By: J Levine

if at the next naxcom show (a week from this friday) which psa routinely sets up at, Psa was asked a few pointed questions from a collector...would they answer? would they try to throw me out of the show (like they throw people off their board)? sue me? Just wondering...

-Joshua

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Posted By: dennis

greg were the 5 psa 8's all from the same seller?

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Posted By: Bottom of the Ninth

Dennis,

The cards were from completed auctions on ebay and from a high profile dealer's website. None were from the same seller.

Greg

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Posted By: MW

http://finance.messages.yahoo.com/bbs?.mm=FN&action=m&board=1600465545&tid=clct&sid=1600465545&mid=3022

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Posted By: MW

To avoid any confusion, the correct dates in the third paragraph of the above referenced post should have been April 2001 and September 2002 instead of April 1991 and September 1992. The U.S. Attorney for the Southern District of California filed formal mail fraud charges on December 23, 2002.

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Posted By: warshawlaw

I have a feeling they will be getting some work...

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Posted By: Anonymous

Dont forget GAI.

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Posted By: warshawlaw

but as far as my collection is concerned, overgrading, holder-slipping GAI is not getting any of them.

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Posted By: Peter Thomas

Adam, I agree with you on that - bought a GAI 7 Ramly with a small paper tear on back - no back photo. Discussed with GAI at national and they were fine with their grade, but not me have reholdered all of the few I have and all but one dropped at least a grade into PSA or SGC holders. I do like their lable on the top.

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Posted By: Mike McGrail

The holier than thou, share selling David Hall states "... if someone flat out lies about our company...we'll take action."

Following this train of thought, I guess the following post on the CU board would be more than sufficient to recieve the ever popular "your outta here" from Obersturmbahnfuhrer Hall

- PSA is open and honest with its stake holders -

Think about it

Ciao for now,

Mike

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Posted By: Judge Dred

Going back a few posts by MW -

John Slight (WIWAG) had been in the hobby several years before (2001/2002). That would be many years before this scandal broke out. He dealt in a lot of vintage material early on. I guess greed got to him. He was a really nice person to deal with back in the early 90s.

First amendment rights don't apply to the CU bull$hiten boards. They'll do what ever they want. Image is everything right? How can they let themselves look bad on their own board? It's pathetic but then it's their board. If they feel they have to censor it then that pretty much indicates how insecure they really are.

I'm not much of a GAI fan. I'll stick with SGC for now. I do however like the GAI labeling on the top of the holders.

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Posted By: warshawlaw

but doesn't make up for the slip n slide insert.

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Posted By: MW

http://finance.messages.yahoo.com/bbs?.mm=FN&action=m&board=1600465545&tid=clct&sid=1600465545&mid=3026