Phil Iveys The chances of collecting the $1.9 million line of credit he gave to an investor in a Las Vegas cannabis dispensary may have declined as the company he’s suing has filed for bankruptcy protection.
On April 11, a company that originally helped Ivey with the bankroll in 2014 – NuVeda, LLC — Filed for Chapter 11 bankruptcy. In June 2020, the poker pro was part of a lawsuit against NuVeda and its subsidiaries that included two other plaintiffs – Shane Terry and Dotan Melachlooking for money owed on a business loan and an equity interest in the company.
This litigation has yet to be resolved. According to court records obtained by PokerNews, Ivey originally received a 3% stake in exchange for a nearly $2 million line of credit he extended to the company. Back then, NuVeda benefited greatly from the money and financial position of the 10-time WSOP bracelet winner.
“Ivey’s extensive business experience and financial resources not only provided a solution in support of Nuveda’s business strategy, but also provided crucial evidence of the financial viability to support Nuveda’s competitive bid, including the amount of taxes paid,” the lawsuit reads.
The Poker Hall of Famer was originally listed and approved as the owner of all six of NuVeda’s licenses by the State of Nevada.
Terry, a joint plaintiff, was promised $1.75 million for his 23 percent interest in the company, but received only about $250,000. Both Ivey and Terry have since been allegedly kidnapped by co-owners Pejman Bady and Pouya Mohajer without the written consent of the plaintiffs.
“Shane Terry was supposed to have received $1.75 million for his interest, but he has only ever received $250,000.” Adam Stein-Sapira bankruptcy expert with Pioneer Funding Group, LLC told PokerNews. “Ivey should have retained a 3% stake, but that appears to have been eliminated entirely. It’s unclear how much Ivey advanced on the $1.9 million line of credit or if it was repaid.”
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According to court filings, NuVeda’s annual license documentation was due with the State of Nevada in December 2015. During that time, Bady allegedly filed paperwork in error, with the state removing Ivey’s licensing interest and redistributing them to himself and Mohajer.
As Stein-Sapir explained, the amount drawn down on the $1.9 million line of credit is unknown, as is the amount repaid to Ivey, but the European Champion of the Super High Roller Series 2022 has engaged in an ongoing legal battle to retain its 3% stake in the company.
Protection of Assets
Bady and Mohajer remain the chief executives of NuVeda and its subsidiaries, which still own two pharmacies The sanctuary Names – one in north Las Vegas and the other in downtown, and Ivey is said to be interested in those deals. However, NuVeda recently filed for Chapter 11 bankruptcy, which could make recovering Ivey even more difficult.
As Stein-Sapir explains, the bankruptcy filing halts litigation in state courts and transfers the case to a bankruptcy judge.
“Companies are taking this action to preserve assets and give themselves breathing space to try to negotiate a deal with creditors, rather than selling assets in a fire sale or allowing a creditor to pledge and take them over,” he said insolvency expert.
Ivey and Terry are listed in the Chapter 11 filing along with two other creditors. Bankruptcy documents indicate that NuVeda claims to have less than $50,000 in assets and between $1 million and $10 million in liabilities.
Ivey won two events during the recently concluded Super High Roller Series Europe in Cyprus. But his ongoing legal battle against the cannabis company he originally helped fund appears to be a losing battle.