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BOYCOTT CDSTREET / CDSTREET.COM


Jim Alfredson

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As some of you may know, back in March of this year we used the services of CDStreet.com to sell our CDs online. They gave us the ability to accept credit cards, we gave them 20% of each sale.

In March we sold 33 CDs which totaled about $420 after CDStreet's cut. As of now we have only received $42 of that money (10%). They paid us for every other month we had sales, but we still have not gotten our $360 from March, which is a good deal of money to us. I keep emailing and calling them to no avail.

So I'm asking you, my fellow board members, to boycott CDStreet. Do not buy anything from them. If you find an interesting artist that uses them, I urge you to email the artist explaining that you will not order from CDStreet and order the CD directly from him/her.

If anyone has any ideas how we can make a stink, please let me know.

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Stink can be made.

Contact the Better Business Bureau of the State where they're located as well as the Department of Consumer Afffairs and alert them.

Send them a certified letter return receipt requested, with a letter explaining your beef. A lawyer-friend would help you out. It would be even better if it were sent on his stationary.

I have a feeling you'll get your money back 100% !

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God, I wish I would've found this before I signed up with them (I'm sorry, my Organissimo brothers... :( )

From a webpage I found on google about making and distributing your own CD.

(Dallas, TX) - CDstreet.com - Something very fishy began going on with CDstreet from December 2002 until March 2003 -- I was NOT getting paid!  Only after I complained did I get paid. In April 2003 the same thing happened again. I knew something was up. UPDATE: 5/13/03 - Sure enough! CDstreet has just upped their fees. CDstreet noted that their costs have risen. I have to imagine that they aren't selling as many CD's as they used to, or they're costs have overtaken their profits. CDstreet.com recently moved to a larger (and probably more costly) warehouse. When CDstreet upped their fees I immediately closed my account and now just sell my CD's via www.ccnow.com and of course Amazon. UPDATE: 7/28/03 - A CDstreet.com vendor emailed to tell me that Cdstreet isn't even returning his phone calls and he hasn't been paid since December! YIKES! He thinks CDstreet is only paying their top selling artists, as is typical with financially stressed distro's. CONCLUSION: The bottom line is that CDstreet must be in red ink (meaning they owe their vendors more than they have money to pay out). That in and of itself is PATHETIC for an Internet retailer because they don't get burned by retailer bankruptcies, as a distributor does. I believe this company could go bankrupt at any time. So get paid and get out! Thinking about opening a first time account?? I say DON'T do it!!!

Hindsight is 20/20.

I just hope we don't get burned. I was talking with my brother-in-law today who is a lawyer and he signed a distribution deal for a book that he wrote with an independent distributor in the Traverse City, MI area. He dropped off 500 copies of his book and sold 420 of them in the first month. After not getting any money from the company for a month he calls them. They give him the "cash flow" excuse and say to wait about four weeks. So he does and calls them again. The person says "We can't talk about this now. Just wait..." so he does...

And two weeks later they go bankrupt. Here's the real stinker:

He did some research on the two guys who owned the company. They are professional independent intellectual property distributors. In other words, they buy or start up these independent distribution companies for books, music, etc. for a small amount of capitol, pay themselves huge salaries for two years, file for company bankrupcy, and walk away.

The worst part: He got a transcript of the bankrupcy court filing and found out that the court actually approved these guy's salaries for the previous year. The CEO made 1.9 million dollars... his second in command made almost $900,000. The CEO lives in a 10 million dollar house on a private island off the coast of Florida and has a helicopter, a jet, a huge yacht, the works. This is what they do professionally and if you try to fight it they come at your with high-priced lawyers and you're fucked.

He took them to court to at least get his 80 remaining books back, but to this day has not seen a bit of the money.

He said he wouldn't be surprised if they own CDStreet.com.

I'm hoping they don't. :(

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He did some research on the two guys who owned the company. They are professional independent intellectual property distributors. In other words, they buy or start up these independent distribution companies for books, music, etc. for a small amount of capitol, pay themselves huge salaries for two years, file for company bankrupcy, and walk away.

The worst part: He got a transcript of the bankrupcy court filing and found out that the court actually approved these guy's salaries for the previous year. The CEO made 1.9 million dollars... his second in command made almost $900,000. The CEO lives in a 10 million dollar house on a private island off the coast of Florida and has a helicopter, a jet, a huge yacht, the works. This is what they do professionally and if you try to fight it they come at your with high-priced lawyers and you're fucked.

He took them to court to at least get his 80 remaining books back, but to this day has not seen a bit of the money.

He said he wouldn't be surprised if they own CDStreet.com.

I'm hoping they don't. :(

In the UK there are TV programs which specialize in taking these sort of guys to task in the court of public opinion. Perhaps CDstreet might also be like that. At any rate, while you would not get your money back, you might get some satisfaction.

The CEO with $1.9m does sound like "a story" from the journalistic point of view. Even if TV programs aren't interested, perhaps journalists might be. I mean it'd be good to get the word out about these guys.

Maybe CDstreet is too small for that.

Simon Weil

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Damn! Well, at least we learned this lesson now, with just a few hundred bones at stake, and not later, when it could be much more costly. And I'm not at all suprised to find out that we weren't the only ones that got burned. Go ahead with the suggested measures, and whatever happens, we'll keep a watch on those guys to witness their inevitable demise. <_<

...so this is where evil hatches its diabolical plans... Time to DIE! :rmad:

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Really terrible news.

Knowing what you know, I would not have bothered with the threatening letter, I'd go straight to the AG of Texas and the BBB also.

You can probably write off the $$ but that doesn't mean you shouldn't try to hurt the bastards, one way or another.

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Just got a reply from Derek Sivers, the person who owns and operates CDBaby. We've been using CDBaby to sell our CDs online since June and they've been fantastic. I emailed Derek asking his advice on the matter.

Wow.

Unfortunately I've heard this from lots of people.

I think they're good people with good intentions and I hear that they're trying to sell the company so that the new cash will pay everyone what they're owed and carry on from there.

But I think right now they're broke, from what I can tell.

(Which honestly pisses me off because RULE NUMBER 1 should always be to not spend money that isn't yours!  If they sold $360 of your CDs, they should have not touched that $360 and paid it directly to you.  Instead if sounds like they spent it.  Grrrrrr....)

But thanks for telling me the specifics.

I think the best thing is to be persistent in asking.

The boldface is mine. This is what worries me. The guys my brother-in-law dealt with buy up companies like this, pay themselves huge salaries, and then leave the company bankrupt.

I hope we can get our money before then... :(

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IF they're trying to sell the company, it's in their best interests not to have any outstanding liens against them, no matter how small. It doesn't look good to the buyers, who would be kinda hesitant to pick up the seller's liabilities.

If I were you, I'd get a move on this. Real quick.

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  • 3 months later...

Just to bring this up, I got an email recently from CDStreet claiming that they are now under new ownership. They also claimed that unpaid sales would be paid for in due time. It gave me a little hope of seeing our $340 from march (not much, but a little).

Well, I just got this email today, entiteld "Happy Holidays from CDStreet".

Dear Artists:

Well, it has been a little over a month since the ownership changed.  We wanted to make sure that all our artists have received their settlement checks for Nov. 1-15, mailed Nov. 20th and for Nov. 16-30th, mailed Dec 5th.  All future settlements will be paid in a similar manner, TWICE a month!!!

We realize that many of you are concerned about amounts owed to you for October and prior settlements.  As stated in the email of Nov. 19th,

THE NEW OWNERSHIP IS NOT RESPONSIBLE FOR ANY AMOUNTS PRIOR TO NOVEMBER 1, 2003 legally or otherwise.  ALL BALANCES PRIOR TO NOVEMBER 2003 are the responsibility of the prior owner.  That address is P.O. Box 9197, Dallas, TX 75209.

YOUR HELP IN GETTING CDSTREET.COM BACK ON ITS FEET, WILL PROVIDE INCOME TO THE PREVIOUS OWNERSHIP THAT WILL GO TOWARDS PAST AMOUNTS OWED TO LABELS AND ARTISTS BEFORE NOVEMBER 1, 2003.

IF YOU HAVE OUT OF STOCK INVENTORY, PLEASE SEND TODAY

WE CAN’T PAY YOU FOR SALES WE CAN’T SHIP!!!!!!

IF YOU ARE AWARE OF OPEN ORDERS FOR WHICH WE DO NOT CURRENTLY HAVE INVENTORY IN OUR WAREHOUSE, PLEASE SEND IT IMMEDIATELY TO CDSTREET, 6305 NORTH O’CONNOR, SUITE 123, IRVING, TX 75039.

The faster we can fill current orders, the happier your fans, the customers, will be this holiday season and the faster you will get paid.  Remember until the order is shipped and marked as shipped in the system, the customer’s credit card is not charged and the artists can not be paid.

So tell your artist friends, that cdstreet is now paying twice a month, to send us the needed product to fill the orders, and to watch your mailbox for those TWICE monthly settlement checks!!

Happy Holidays!!!

The CDSTREET Team

The red type is my doing. Can you believe this?? The new ownership is not responsable for anything before November 1st when they took over... great... so who gives a fuck that they took over?!? And I love this one:

YOUR HELP IN GETTING CDSTREET.COM BACK ON ITS FEET, WILL PROVIDE INCOME TO THE PREVIOUS OWNERSHIP THAT WILL GO TOWARDS PAST AMOUNTS OWED TO LABELS AND ARTISTS BEFORE NOVEMBER 1, 2003.

Oh I bet. I bet the old ownership is just itching to pay me the money they fuckin' owe me in the first place... what a stupendous idea... sell my MORE of my product through you so you can pay me money you've owed me since March 2003. Brilliant idea, Watson.

BOYCOTT CDSTREET!!!!! DO NOT DO BUSINESS WITH THESE SHYSTERS!!!! TELL EVERYONE YOU KNOW!

Fuck them.

:angry::tdown:angry::tdown:angry:

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Well, what the letter says is that they didn't buy the company outright, they are making payments, that's what this means:

YOUR HELP IN GETTING CDSTREET.COM BACK ON ITS FEET, WILL PROVIDE INCOME TO THE PREVIOUS OWNERSHIP THAT WILL GO TOWARDS PAST AMOUNTS OWED TO LABELS AND ARTISTS BEFORE NOVEMBER 1, 2003.

But I wouldn't at all be surprised that the purchase agreement also explictly assigns those pre-existing debts to the prior ownership.

But the problem with this statement is that even if the new ownership gets support from the artists, sells CDs and makes its monthly or quarterly payment to the prior ownership, there's absolutely no guarantee that the prior owners intend to use this money to pay off their debts. In fact, only a fool would believe that-they've got cash out of the business and surely have no intention of honoring the debts they racked up, short of a court judgement.

To me, the question is, was the business failing due to slow sales or a revenue sharing plan that was too generous to artists to be sustained, or was the business predicated on fraud from the start (sell CDs on consignment, pocket the $$, don't pay the supplier)? If that's the case, it would be apparent to the new owners when they studied the books, and then, in my layman's opinion, you might have a case against the new owners for colluding in the fraud.

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you might want to ask any lawyers on the board, but I am fairly certain that, unless CDStreet legally declared bankruptcy, the new owners actually are responsible for any outstanding debts.

That letter is garbage.

It depends on the form of ownership of the business and how the sale was structured.

If, say, the business was owned by a corporation, and the buyer purchased the stock of that corporation, then of course that corporation remains liable for its debt, even though it has new stockholders.

However, for an insolvent business, it is likely that the buyer would insist on an asset sale--that is, the buyer would purchase the assets of the business and assume only those liabilities specified in the contract. In that case, a new corporation or other entity set up by the buyer likely would acquire the assets of the selling corporation and generally would not be liable for the seller's debts unless the the debt's were assumed under the contract, the creditor had a security interest in the assets sold, or there was a fraudulent transfer (that is, the buyer is purchasing the business for less than its value and has a bad intent).

Without knowing the facts, it's impossible to say for sure if the buyer is liable for unpaid trade debt, but if the buyer was represented by a competent lawyer, the deal could certainly be structured in a manner which left the old corporation liable for the debt, not the new corporation. In that case, the debts should be paid from the proceeds of sale received by the old corporation, if any, before any proceeds could be paid to the owners of the old corporation. If they liquidated the old corporation and distributed proceeds without paying creditors, then the shareholders of the old corporation would be liable to the extent they receive distributions.

Of course, I don't know how this business or this sale was structured, so this is merely speculation.

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Jim,

Thank you very much for your cdstreet.com application.  All looks

good, and we look forward to helping you market your merchandise.

*Note:  Setup will proceed on our end if you've successfully

submitted your payment during the signup process.  You will have

received an e-mail confirmation of your paid fee upon successful

payment.  If for some reason you were unable to complete the payment

online, please contact us at:  mailto:signup@cdstreet.com, and we

will help complete the process for you.

Please keep your cdstreet.com username and password handy for future

reference.  You'll need it to access our artist administration areas.

** NOTE:  Your username and password will not be active until

** we have completed the activation of your account.  We will

** notify you as soon as you are ready to go, and we'll provide

** more information about how you can manage your cdstreet account.

   Your username will be:  organissimo

   Your password will be:  friday

No matter which shipping option you have selected, you will receive a

copy of each order that comes into the system.  Our system also

generates shipping confirmations for the buyers once the order is

shipped.

- IF YOU HAVE SELECTED THE CDSTREET SHIPPING AND FULFILLMENT OPTION,

you will need to provide a small inventory of each item offered. We

are responsible for product that is in our possession. We prepare a

receipt/packing list for each order and generally ship within 24

hours with an email confirmation of shipment to the buyer.

   Our Mailing Address is:

   CDstreet.com

   1350 Manufacturing Suite 111

   Dallas, TX 75207

Send over your items for our stock and we'll be good to go. The

opening inventory is your call.  Please do not use padded envelopes

when sending CDs or tapes because 9 times out of 10 they arrive with

most of them cracked!  Boxes work the best, pack the items well.

- IF YOU HAVE SELECTED THE "SELF-SHIP" OPTION - As you receive

orders, ship them as quickly as possible Then, please log into the artist

administration area of cdstreet.com using the user name and password

you've supplied to us, and mark any completed orders as "shipped" in

order to release payment to you.  Orders must be marked as "shipped" in

order to capture the credit card payment of the buyer.  Note that orders

must be shipped and captured in order to be paid to you with the

monthly settlement.If you have a supply problem or delay of shipment,

please communicate this via email to the buyer.

If you have selected our e-commerce enable your site option, our

technical team will have the shopping code for you very soon.  If

they should have any questions for you, they will email as well.

Otherwise, we will have complete instructions for placing the code on

your product(s) page in order to get your online sales going through

your own website as well.

Again, we settle at the beginning of each month for the prior month's

sales.  You will receive a check less the CDstreet fee no later than

the 10th of the month, probably sooner.  We are looking forward to

doing business with you.  Should you have any questions, email us at

(mailto:support@cdstreet.com).

Talk to you soon -

Brad Koester, President

CDstreet.com

Support Independent Music "Indie Artist Direct"

_______________________________________________________________________

cdstreet.com Service Agreement

Fulfillment:

You may opt to ship the orders yourself or have CDstreet.com perform fulfillment. Either way, domestic (US/CAN) are charged $2.99 PER ORDER and International orders are $7.99 PER ORDER for orders under $30.00 USD. If the order is over $30.00, the per order charge is $3.99 for US/CAN and $7.99 INTL. If you are shipping your own orders, these charges will be passed to you with the monthly settlement less the CDstreet fee. If CDstreet.com is shipping, then we keep these P & H charges. We recommend US Post Office FIRST CLASS. For One CD in a CD box, shipping costs average $1.50 nationwide. Box cost of about 0.30. For International clients who are self-shipping, we have special P & H pricing plans. Contact CDstreet for more info.

IF YOU SELECT THE CDSTREET SHIPPING AND FULFILLMENT OPTION, you will need to provide a small inventory of each item to be offered online. We are responsible for product that is in our possession. We prepare a receipt/packing list for each order and generally ship within 24 hours. Again, the only difference with this option is that CDstreet.com keeps the postage and handling charges with each order shipped.

Our Warehouse Address for Your Inventory is:

  CDstreet.com 1350 Manufacturing Suite 111 Dallas, TX 75207

Settlement & Fees:

The month's sales books are closed at month's end. By the 10th day of the following month, you will be sent a statement of sales and a check for the net amount due. Our service fee is 20% of gross proceeds collected from total sales of your product. This includes charges for postage and handling that are collected with each order for self-shipping clients.

Set-up Fees:

A one-time setup fee of $29.99 is collected by secure credit card transaction during the online setup process. There are no recurring fees. If you have no sales during any given month, then there is no cost to use CDstreet.com. We will create the ordering code for your site. After review of your application, this HTML will be sent by our technical staff.

Payment Capture:

To reduce risk to our customers, we do not capture the authorized credit card charge until we have confirmation of shipping. IF YOU SHIP YOUR OWN ORDERS, FORWARD THE EMAIL CONFIRMATION BACK TO CDSTREET FOR PAYMENT CAPTURE IMMEDIATELY UPON SHIPMENT. Note the shipping method as well in email confirmation. We recommend shipping within 48 hours. Any delays in shipping should be communicated to the buyer as soon as possible. We also recommend that a "Shipment Confirm" is sent via email to the buyer. These types of communications with the buyers are part of the CDstreet.com fulfillment process and work to build the buyers trust and confidence.

Customer Charges:

ALL CHARGES FOR THE SALES OF YOUR MUSIC PRODUCTS WILL APPEAR ON THE CUSTOMERS BILL FROM CDSTREET.COM. To prevent confusion, you should mention this on your product pages. We can provide an insert card for shipping which again mentions CDstreet.com. Avoiding chargebacks is the name of the game here. In nearly all cases, we have prevailed in chargebacks due to good record keeping.

Our Return Policy:

All CDs are guaranteed to play perfectly for 30 days from receipt. Any CD which does not play perfectly may be returned, with prior authorization, for a replacement copy of the same CD. All returned CDs require a return authorization number prior to their return. To acquire a return authorization, email customer service identifying the CD and order with a description of the defect. Note that all returned CDs must be in the same condition as when they were received, including the jewel box and liner notes.CDstreet.com will process these returns and manage the process. Should money have to be returned for some reason, your account will be charged the returned amount. Our actual policies for our buyers can be found on the "Buyers" page at CDstreet.com.

Changes/Additions of Items:

We can change pricing in our product database and add new products at almost anytime. Please email us with the details and all changes will be implemented within 24 hours. If new shopping code is needed, it will be generated and sent to you ASAP.

Termination of Service:

Service and relationship with CDstreet.com can be terminated with 30 days written notice by either party. Email is acceptable.

Disclaimer:

THE SERVICE AND SOFTWARE ARE PROVIDED ON AN "AS IS" AND "AS AVAILABLE" BASIS WITHOUT WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR NON-INFRINGEMENT. NEITHER THIS AGREEMENT OR ANY DOCUMENTATION FURNISHED UNDER IT IS INTENDED TO EXPRESS OR IMPLY ANY WARRANTY THAT THE ONLINE TRANSACTION SERVICES WILL BE UNINTERRUPTED, TIMELY OR ERROR-FREE OR THAT THE SOFTWARE WILL PROVIDE UNINTERRUPTED, TIMELY OR ERROR FREE SERVICE. THE SECURITY MECHANISM INCORPORATED IN THE SOFTWARE HAS INHERENT LIMITATIONS AND MERCHANT MUST DETERMINE THAT THE SOFTWARE ADEQUATELY MEETS ITS REQUIREMENTS.

MERCHANT ACKNOWLEDGES AND AGREES THAT ANY MATERIAL AND/OR DATA DOWNLOADED OR OTHERWISE OBTAINED THROUGH THE USE OF THE SERVICE IS DONE AT ITS OWN DISCRETION AND RISK AND THAT MERCHANT WILL BE SOLELY RESPONSIBLE FOR ANY DAMAGES TO ITS COMPUTER SYSTEM OR LOSS OF DATA THAT RESULTS FROM THE DOWNLOAD OR SALE OF SUCH MATERIAL AND/OR DATA.

MERCHANT ACKNOWLEDGES AND AGREES THAT CDSTREET IS NOT RESPONSIBLE FOR ANY CONTENT OF ITS MERCHANTS AND BY USING THIS ECOMMERCE SYSTEM DOES NOT IMPLY THAT IT REFLECTS THE OPINION OF MANAGEMENT OR OWNERSHIP OF CDSTREET. NO CONTENT DEEMED ILLEGAL CAN BE SOLD USING CDSTREET. ANY LIABILITY OR DAMAGES THAT MAY RESULT FROM THE SALE OF ANY MATERIAL USING THE CDSTREET NETWORK WILL BE THE SOLE RESPONSIBILITY OF THE MERCHANT AND/OR CONTENT CREATOR. CDSTREET RESERVES THE RIGHT TO DENY USE OF OUR SYSTEM AT ANYTIME.

Final Note:

The use of this service is intended to offer a new channel of distribution for the music merchant organization. It is our intent to operate this secure processing system with integrity and full faith for the benefit of our buying customers. We expect timely shipping and response to any customer situation. In the end, if we satisfy our music customers, then we will all prosper and further the cause of independent music and electronic commerce. By completing this application, your are accepting its terms and agreement. We look forward to doing business with you. Support Independent Music!

The bold is mine. I find that statement funny because I emailed them three times last June and told them to terminate our contact and take our product off the website. Two weeks ago I got an email saying someone had bought 2 CDs of ours through them. I had to email the person (they supply the buyer's email in the email to me) and ask them to please cancel their order and order instead from CDBaby. I explained the whole non-paying thing and she was very kind... but how embarassing.

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  • 1 month later...
  • 8 months later...

I just got another order through CDStreet for our CD. I've emailed, called, and faxed them several times asking them to remove us from the website, obviously to no avail.

It's really embarassing to have to email the nice people buying our CD and ask them to cancel their order and instead order it through CDBaby or directly through us.

I hate CDStreet.

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I just got another order through CDStreet for our CD.  I've emailed, called, and faxed them several times asking them to remove us from the website, obviously to no avail.

It's really embarassing to have to email the nice people buying our CD and ask them to cancel their order and instead order it through CDBaby or directly through us.

I hate CDStreet.

But I assume you tell them why this is necessary, and that gives them the negative publicity they so imminently deserve. I would think (hope) that people who learn how scummy their business practices are will think twice about ordering anything else from them ...

And as another criminal likes to say, "that's a good thing!" :g

Edited by Dan Gould
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OK, let's put our great minds together, and collectively figure out how we can get CDSTREET.COM to remove Jim's CD from their website.

What if everyone one of us here e-mailed them and said "listen guys, you need to stop listing the Organissimo CD on your website, because you're not selling it any more".

There are a handful of lawyers on this board -- can somebody send a mean letter to them (by snail-mail), on official letterhead, and get them to comply??

What other ways can we help in this effort???

Other ideas, anybody??

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