iYogi Attempts to Settle $6.7 Million IT Services Lawsuit
iYogi is attempting to settle yet another lawsuit, but the embattled IT services provider doesn’t have enough money on hand to do so, according to a May 12, 2016, court filing viewed by ChannelE2E.
iYogi, based in India, is a remote IT service specialist that faces multiple lawsuits — ranging from breach of contract to deceptive sales tactics. Infinite Computer Solutions, for one, alleges that iYogi owes Infinite $6.7 million in unpaid bills and related penalties.
In a May 12 joint letter to the judge overseeing the case, attorneys for both sides stated;
“Plaintiff alleges that iYogi has failed to make payments due on multiple invoices in the accrued sum of $6,298,739 as of November 1, 2015; Plaintiff further alleges that, since that date, an additional $425,000 has become due under the agreement. As pled in the Complaint, Infinite is a Delaware Corporation with a principal place of business in Maryland. iYogi is a New York Corporation whose principal place of business is neither in Maryland nor in Delaware.”
In the same letter, iYogi says Infinite is not entitled to such a sum. However, both sides seem to be exploring a settlement — though iYogi will need to find money to fund such a move:
“Counsel have conferred, and as of this date, the prospects for settlement of this matter are not clear. Defendant has indicated that it will make a settlement offer, but that it is not currently in a financial position to do so.”
The situation apparently is similar in OneCall’s $375,000 lawsuit against iYogi. In an April 4 letter about that case, OneCall says there have been settlement discussions with iYogi. But ChannelE2E has not seen an update in the case since that time.
iYogi’s Legal Headaches
Meanwhile, additional lawsuits against iYogi apparently are still pending. They include:
- Washington State and Argo Marketing each filed suit against the company for various alleged violations.
- Bankers Warranty Group alleged breach of contract, breach of implied duty of good faith and fair dealing, intentional misrepresentation, quantum meruit, and unjust enrichment. The company is seeking judgment against iYogi for at least $238,791 plus various fees.
- Concentrix Corp., a division of Synnex, continues to pursue legal action against iYogi for alleged breach of contract.
- Tata Communications (America) Inc. alleged that iYogi failed to pay numerous telecom invoices. As of January 10, 2016, iYogi owed Tata $1.154 million plus late charges and additional fees, the service provider alleged. Tata is seeking to recover that figure and various fees.
Some iYogi Customers Feel Burned
Meanwhile, iYogi apparently has cut service levels to customers — many of whom pay the company for remote desktop support.
ChannelE2E has received dozens of reader comments and emails from alleged iYogi customers, many of whom claim the IT services provider is non-responsive to their support and contract inquiries. ChannelE2E has reached out multiple times to iYogi for comment, but has received no reply.
It’s unclear how or if iYogi will find the funds needed to settle one or more lawsuits. Some employees allege that the company failed to meet payroll at times, suggesting that the company’s cash crunch has been serious in recent months.