Data Knight 365: The fat lady clears her throat
My story in today’s Floyd Press outlines the latest chapter in the saga of Data Knight 365 .
That 51.5 acres of undeveloped land in Floyd’s mostly-empty Commerce Park will stay that way for a while. Data Knight 365 (DK3), dubbed “Dark Knight 365″ by some in Floyd County, appears ready to ride off into the sunset, along with its portfolio of unfulfilled promises and unmet goals.
William W. Byler, owner of record for DK3, is vacating his apartment at The Station on South Locust, telling his landlord he will be out by the end of the month — two days before the latest “final” deadline (Dec. 2) for closing on a $900,000 purchase of the land after mssing two previous deadlines for coming up with a $100,000 down payment. DK3 leaves Floyd County with our cash-strapped government owing more than $12,000 in legal bills and little chance of ever collecting. Other governments have tried, and failed, to collect from the folks involved in DK3. Some still try. Others gave up.
While it is still possible that someone might come up with the 100 grand for a down payment, few expect that to happen. “It’s over,” one EDA member told me earlier this week. When the Dec. 2 deadline passes, probably all that will be left of the grand promises of a $67.8 million data center will be the blame game.
For some, that game has already started. Promoter Paul Allen told local contractor Ed Erwin recently that my stories about questionable past dealings of the principals in the deal “drove away investors.” Dan Delfino, head of Power Direct, the one-time “money behind the deal,” says I poisoned the waters and made it impossible for him to do business in Floyd County. I’m told that at least one county official will claim publicly that I ruined the deal by writing about the past problems of Allen, Delfino and others in the project.
I doubt seriously that anything I wrote “killed” the data center deal, if it finally dies on Dec. 2. If anything, what I wrote may have prevented some in Floyd County from losing money by investing in the scheme. The DK3 appeared doomed from the start, torpedoed by greed, grandiose promises and the desperation of a cash-strapped county. To some who actually know a thing or two about business deals, this one smelled from the start and was probably dead on arrival before it was announced.
The warning signs were there for anyone who took the time to look closely at DK3 and it principals. The past problems of Allen and his failed company, B-Telecom, the history of Delfino and Power Direct, the overblown claims of jobs and benefits to the county: All served notice early on that the deal most likely would not fly.
I for one appreciate your investigation of the matter. As for the fact that you “drove away investors.” I am fairly sure that an LLC isn’t allowed to sell shares.
Casey: You’re right that an LLC cannot legally sell shares but I have talked with a number of local residents who were approached about “investing” in the project.
Glad you did your homework Doug…As for any county official stating you are the cause…they better do their homework next time……and for the record someone should watch and see IF this company ever finishes this project anywhere…I doubt It.
I for one know of a person who was eager to invest and keep the DK3 deal on the down-low because he wanted the lion’s share of the deal. After your first report he came out of the closet and claimed to have never wanted “in” on the stock purchase. Can’t believe we’re 12K in the hole as a county because of this! Good job Doug…
Well I am sure that Paul Allen will have no more use for bill byler anymore you should go after his co. for the money he has a great business here in Ohio if Paul has not yet drained it dry, You should consider yourself lucky byou are only 12,0000.00 in the hole. I would look ninto getting new officials because we notified Jack Russell way before this deal was taking place so he knew very well what he was getting his county into but it was probably going to benefit him in some way (like steve henry in oakland bank) I wonder if the allens will stay in floyd.
…what their excuses were for all the other places where they had a little “trouble” doing business.
Doug , Thanks for all the work and just excellent reporting on this matter, I know you brought a lot of needed attention to a possible, con artist, from the past and even if some Floyd officials won’t recognize an say it you deserve a big pat on the back for job well done, thanks from me tax payer of this county, you saved Us all a lot of money.
To be clear on the matter of selling shares, “shares” are not a normal method used in a standard LLC structuring. However, “membership units”, aka the principles, can be exchanged or sold by simply filing with the SCC. So in theory, investors can buy their way into the company for the development purposes, there are several projects in Floyd currently that are structured this way.
A LLC can also be set up in a sub chapter-S category, which is basically treated just like a corporation as far as liability protection goes, but the tax side of things being like an LLC (pass through entity)
Personally, I feel this whole matter became an overly dramatic fiasco that should have been handled differently. From the start, people started throwing accusations and false information, and it merely compounded from there. There were several instances of straight false information being used as the basis for discussion, which reminded me of this years gubernatorial election.
I am not defending anyone nor am I accosting anyone, but in true small town fashion, people started talking and the rumors started flying. Add in past dealings gone south, with pissed off people from them, and you have a veritable plethora of problems that create the perfect storm, or in more correct terminology for here, perfect shitstorm.
The EDA has done a good job as far as I can see, they looked at the deal from many perspectives, the main one being jobs and tax revenue for the county. Because in the long and short of it, that is all it boils down to. We built the Commerce Park (yet another controversial thing, but in the end it will all work out) to bring jobs to the county, and they did their part to work a deal for it.
I am not going to go into the discussion regarding jobs in Floyd, that has been covered well in the past and is a long, ongoing topic no matter where you are. Nor am I going to go into the political side of things regarding how things are operated in this county, for that is a never-ending debate.
The path to an outcome is always riddled with hurdles and challenges, but if you ask anyone that has done a large endeavor, or even a small one for that matter, the results are worth it at the end. I will be disappointed if this deal falls through, but if it does, so be it. It would be nice to see more businesses coming to this area, bringing tax revenue with it (might decrease some of the whining people do about their personal share of taxes, but I doubt it) and allowing people to have a good paying job in their area.
Just the thoughts of a simple minded person that has lived here all his life.
Joey