Ambit Energy in a big time lawsuit I assume a class action

LawsuitWe just heard today from one of our website visitors that Ambit Energy has been accused of fraud by intentionally not paying deserved commissions to multiple energy consultants working for the company.

The lawsuit also makes allegations that the type of business they operates is a pyramid scheme. She claims that Ambit makes false and misleading statements to lure in people to the opportunity.

Gubin believes these misleading statements prove that Ambit has violated the deceptive trade practices act in Section 5(a) of the Federal Trade Commission Act. Gubin also uses Racketeer Influenced and Corrupt Organizations laws to make her case.

The suit, filed in U.S. District Court for the Eastern
District of New York, is Nicole Gubin and BH Seven LLC v.
Ambit Energy LP

In the lawsuit it is alleged by Nicole Gubin from Queens, New York that the company has not paid her the rightful money she has made by particpating in the multi-level marketing opportunity nor have they paid the correct amount to other consultants.

Her lawyer, Richard Vanderford Law 360 out of New york filed the lawsuit on May 24 2011 and in the lawsuit is also the claim of bias. The Ambit lawsuit is for $1.1 billion dollars and was filed in New York federal court. The allegation is that Ambit Energy broke her contract and illegally discriminated against her.

A similar competitor to Ambit by the name of Ignite Energy is still in an ongoing class action in which fraud is also alleged. Ignite routinely terminates consultant agreements for advertising on the internet.

We will provide more information on this case as it becomes available. Feel free to comment below.

 

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Posted in New York
14 comments on “Ambit Energy in a big time lawsuit I assume a class action
  1. yuri says:

    The big Ambit lie is that you can earn any real residual income in Ambit. Why is it a lie? Because Ambit has hidden qualification requirements that are set so high that the vast majority of people will never get paid no matter how big there dowline is. Ambit will get it but the field won’t. Yes, the big money is all illustrated in the Ambit presentation but the qualifications are not disclosed. It is blatently deceptive.

    For anyone that knows anything about MLM this is an old dirty trick that some companies use to make their presentation look good on the surface but they never have to pay out much to the field. The ugly truth is you can put anything in a presentation if you set the qualifications so outrageously high that hardly anyone will ever qualify to get paid. The result is that a few will always get qualified to be paid (or have qualifications waived by Ambit like the ex-Excel hired guns) but since the bar is set so high the vast majority will never get qualified to get paid and the foundation will begin to crumble soon for all. The unbelieveable truth is that the qualification requirements are still way to high even though they have already been lowerd once.

    For example, the Ambit presentation illustrates $151,090 residual income/month (sure) but they never mention that you must have 20 personal customers to be qualified to get paid. Look at all the qualifications to get paid and you will see that the average person will never qualify to earn more than a few hundred dollars in residual income. Even worse, the same presentation that illustrates $151,090/month shows everyone with only 10 customers which means nobody in the example is qualified to get paid that amount. This is beyond simple deception.

    Now I know some of you out there are simply Ambit shills, but if you are truely serious about getting paid for your efforts at Ambit then this information has to make you sit back and wonder about the future.

    • Jim says:

      Yuri,

      So in order to be qualified to get commissions with Ambit you must have 20 personally sponsored customers? That’s a lot of customers for the average Joe. I would imagine a rep still makes some money if they get to 10 personal customers or am I wrong on this?

  2. yuri says:

    As for the hired guns, the last meeting I went to did not give me the ****** to sell anything. Mr. Chambless and his so called team of experts needs to get with the program. I remember Mr. Lawrence in a meeting a while back as being the life of the party. He should lead the channel. Mr. Chambless needs to go! A big bore!

    Imagine, another failed business by Mr. Thompson and Mr. Janglefish.

    • admin says:

      Yuri,

      Your comments about Mr. Chambless seem like personal attacks and so it would be hard for people to really take your comments seriously when reading this comment. If he was not offering anything of value in the meeting please be more specific. Please stick to the facts and you will go farther in informing people and helping them avoid what you seem to believe is a scam.

      Thanks,

      Jim

  3. Yuri says:

    The information I have is that the founders of Ambit are hiding their failed business experiences at Janglefish, Radius, Blue Vista and Spruce and now they are hiding the exit of their COO and architect of the Ambit marketing and compensation plan.

    • admin says:

      Yuri,

      How are they hiding these facts? Are they shredding documents, and other illegal activities are just not advertising these facts? Most of us would not reveal the negatives about our work history when filling out an application for employment but would stick with relevant details any a positive light for the job they are applying for. If Ambit is simply not letting people know that their executives had unsuccessful MLM’s in their past I do not see this as scandalous but at the same time it is worth while information to know if you are considering joining a company like this. The point here is that you can’t expect a company or their executives to air their dirty laundry you would be expected to dig that up and research it on your own.

      Thanks,

      Jim

  4. Yuri says:

    February 5, 1999 CAPROCK TEAMS WITH ENRON

    CapRock Communications Corp. (Nasdaq: CPRK) today announced it has signed an agreement with Enron Communications, a wholly owned subsidiary of Enron Corp. [NYSE: ENE], to jointly build over 1,000-miles of fiber optic network within the state of Texas. Construction on the more than $100 million project will begin immediately and is anticipated to be completed this fall.

    The network will connect Amarillo, Lubbock, Dallas, Fort Worth, Waco, Bryan, Austin, San Marcos, San Antonio and Houston. The project will include an advanced, highly scalable fiber network capable of providing unprecedented capacity for voice, data and video traffic transmission.

    “It is tremendously exciting for us to be associated with a company the caliber of Enron Communications. The benefits of this network to the people and businesses in the state of Texas are enormous,” said Jere W. Thompson, Jr., CapRock chairman and CEO. “This relationship enables CapRock and Enron to be the first to connect these Texas markets with an advanced, state-of-the-art fiber network that will greatly reduce communication costs to customers.”

    July 26, 2000 CLASS ACTION COMPLAINT FOR VIOLATION OF THE FEDERAL SECURITIES LAWS

    Defendants’ false and misleading statements concerning the revenues to be derived from its dark fiber segment, which would result in second quarter 2000 earnings per share (“EPS”) of $(0.08) and revenue of $70 million, artificially inflated the price of CapRock stock to a Class Period high of $36. This upsurge in CapRock’s stock price caused by defendants’ false and misleading statements allowed CapRock to sell 4.5 million shares of CapRock stock for proceeds of $83 million and enabled defendants to infuse CapRock with desperately needed capital to fund its operations. On July 6, 2000, days after CapRock’s Secondary Offering was completed, CapRock revealed that it was in fact suffering a huge drop in revenues, and that its losses would be 800% greater than defendants had stated in the prior weeks, and exposed the problems CapRock had been experiencing during the Class Period with its dark fiber business. This announcement caused its stock price to drop to as low as $12 from its Class Period high of $36 on record volume of over 4 million shares on July 6, 2000, causing tens of millions of dollars in damages to members of the Class.

    October 3, 2000 CapRock’s sale to McLeodUSA announced

    CapRock announced on October 3, 2000 that it had entered into a definitive merger agreement with McLeodUSA Incorporated (Nasdaq: MCLD). McLeodUSA will acquire CapRock through the issuance of approximately 15.1 million shares of McLeodUSA common stock.

    January 31, 2002 Chapter 11 Reorganization.

    During 2002 we evaluated our capital structure and on January 31, 2002, McLeodUSA Incorporated, the parent company, filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware

    October 19, 2005 after filing bankruptcy for a second time McLeodUSA was reorganized, JOINT PREPACKAGED PLAN OF REORGANIZATION OF McLEODUSA INCORPORATED AND ITS AFFILIATE DEBTORS

    As of October 31, 2005, there were 201,946,344 shares of Class A Common Stock, 78,203,135 shares of Class B Common Stock, 35,546,879 shares of Class C Common Stock, 2,285,864 shares of Preferred Series A Stock and 10 shares of Preferred Series B Stock issued and outstanding. Under the Plan, all such shares shall be cancelled and no consideration will be paid or delivered with respect thereto.

    Jere less than honest about the name of another company he founded.

    Involved with Enron.

    Subject of a class action stock holders lawsuit.

    Merged the company for common stock to McLeodUSA, a failing company that filed bankruptcy twice. Common stock that very quickly became worthless.

    Now an MLM.

    You be the judge.

    • admin says:

      Yuri,

      Useful bit of history but I don’t think this really proves anything about Ambit or about the executives there not being honest. It is up to people like you to research the company for this type of thing which you have done. You can’t expect a company to publish every negative thing they have done on their website.

  5. VA says:

    First she alleged that this is a pyramid scheme, then she says that she was particpating in the multi-level marketing opportunity. Go find out the difference between a Pyramid Scheme (which is an illegal scheme) and a true MLM business model before you waste money with an attorney. And to claim that she hasn’t been paid, she probably doesnt understand Ambit’s compensation plan either. Its amazing how people who are unsuccessful in all types of business always try to find guilt in someone else and yet, try to get money out of it.

    • admin says:

      Because there is a law firm suing Ambit I would assume they will likely be making the case that the intention of the presentation is to deceive the potential reps by strategically shining a light on the positives while not discussing the negatives of the compensation plan. Although the terms of service and rep agreement may explain all of this it is still important to make important things like results and compensation very clear in the advertising and presentation as courts will sometimes side with the litigator’s argument that the MLM company intentionally created ads to deceive even though the contract spelled it out. I don’t know much about the case so I am not really sure what direction they will be taking this case but this is my opinion on what I think they will likely do.

  6. Kami says:

    Ambit energy is a SCAM. I signed up in November of 2010 and didnt actually receive anything from them until January 2011. At first I saved roughly $20 a month. It was too good to be true. July hit and all of a sudden I got billed for $175.25 (my bill was $65 each month prior). I called Ambit and they said “sorry we supply the gas but you have to talk to National Grid about this. So I called National Grid and noticed that they have not read our meter in a year. Mind you about a month before we got a letter from Ambit saying that they noticed that we are using more gas then they thought. My gas meter is in the house so there is no way anyone can read my meter without me letting them in the basement. So I gave my new reading to National Grid and they advised me to not pay and that they would mail me a revised bill because we used LESS gas than they estimated. We waited and 11 days later we got the new one. In 11 days Ambit energy charged us another $175.25 on top of the $175.25 they bill 11 days before. Mind you the first bill said balance due to company $364.68 and the revised bill says balance due in your favor $86.85. I called Ambit and no one can help or even explain why they are doing this (not even the supervisors). No one in Ambit gets back to you when they say they will and no one can help in my situation. All they tell me is to pay the $350.00 and they will compensate us when/if they find reason to refund any payment. I do not trust Ambit in the least they are a SCAM!!

  7. admin says:

    Kami,

    Often people will get a higher electric bill in the summer because of air conditioning. If your contract expires around the same time your cooling usage drives up your electric usage from 1,000 kilowatt hours a month to 3,000 kilowatt hours a month it could look like your electric company is scamming you. In this situation if your contract expires and your rate goes to a variable price from 9 cents fixed to 13 cents variable and you triple your electric usage it could look like the provider has really attempted to scam you but in reality you simply forgot to renew your contract and it is during a time in the year when your cooling raises the amount of electricity you use. Again this is a very common misunderstanding that effects all electric providers that deal with electricity service consumers.

  8. the 6 of us says:

    admin: you weren’t listening. Kami had no problem with National Grid – seems they treated her fairly…told her not to pay the bill until they got it straightened out (with no penalty) Ambit on the other hand, wanted their double charged monies, and, I guess, would straighten it out at their convenience.
    We were considering becoming consultants after speaking to friends of ours, but I can’t seem to get simple answers
    Went to the meeting at the Westchester Marriot, and the group was told “there will be no negative comments, no questions”. That doesn’t seem quite right, does it?
    Not so sure this is a

  9. Thomas R Bright says:

    I recently joined Ambit after extensive research of the company and persons! I have read comments of those individuals who seem to feel discriminated against and from those who have felt it to be a scam. Fact is, no business will be successful without putting out effort. Another fact is; more millionaires have been made from MLM’s than any other business. Since it is a business in it’s infant stage, I do not see any reason to believe an opportunity does not exist.
    To all those who feel discriminated against; ethics and company policy, whether this business or any other non-MLM business, are in place to be followed. In my small retail business, I have certain policy’s that are in practice. If you are not willing to follow these practices, I have no need for your employ. Is that discriminating? I call it running a successful business!

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