As Nets Inc began sinking in a sea of debt earlier this year, company boss Jim Manzi tried to keep the firm afloat by pumping in $500,000 a week from his private fortune while trying to obtain additional funding. Alas, the generosity of a man who made a $78m fortune when he sold Lotus Development Corp to IBM Corp in 1995 has now exploded in his face. A committee of Nets’ creditors is now suing Manzi, claiming that his four cash advances before the company filed for bankruptcy were an attempt to shift assets to an equity holder at the expense of other creditors. The suit claims that Manzi’s bid to turn his advances into secure loans constituted a fraudulent transfer of assets.
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