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Disconnected: Wtechlink co-founders split after lengthy legal battle

Byron Wysocki buys out Jordan McDonald after lawsuit alleging misuse of company funds
Phil Wright

East Oregonian

Published on October 18, 2017 12:01AM

Last changed on October 19, 2017 9:39AM

EO file photo
Byron Wysocki, left, and Jordan McDonald began their partnership in 2001 creating the wireless broadband company Wtechlink.

EO file photo Byron Wysocki, left, and Jordan McDonald began their partnership in 2001 creating the wireless broadband company Wtechlink.

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Jordan McDonald’s legal battles with his former business partner over one of Eastern Oregon’s top internet service providers have ended. Court records show McDonald a few weeks ago cut ties with Byron Wysocki and Pendleton-based Wtechlink, the company they opened together in 2002.

“I’m out of it, I’m no longer working there,” McDonald said. “That’s no longer my problem.”

Wysocki now is the sole owner of Wtechlink.

“It was an ugly divorce, and both parties have moved on,” he said. “I wish Mr. McDonald well and have nothing but admiration for him.”

Wysocki said Wtechlink has around 4,000 customers in Pendleton, Pilot Rock, Athena, Adams, Helix and on the Umatilla Indian Reservation, and he remains at the helm, while his mother, Carol Wysocki, now oversees the company’s finances.

She is a certified public accountant in the Tri-Cities, Washington, and said Wtechlink remains healthy, but beyond that she did not want to comment.

She also declined to say if Byron Wysocki has treated Wtechlink as a personal checking account, one of the central reasons McDonald sued Wysocki in late 2013 and tried to oust him from controlling the company.

McDonald in that lawsuit alleged Wysocki mismanaged Wtechlink and siphoned off tens of thousands of company dollars for other endeavors and personal expenses. They settled the suit in October 2015, with Wysocki agreeing to buy out McDonald’s 35 percent share of the company for $483,500 in 60 monthly installments of $9,573.88 beginning Nov. 1, 2015.

The deal also called for McDonald to step down as corporate officer and director but stay on as an employee and vice president with the exclusive role of managing Wtechlink’s day-to-day operations, including finances and employees.

The details of the settlement came in McDonald’s second lawsuit, which he filed in May 2016 in Multnomah County Circuit Court after Wysocki made good on only the first payment. And even then, according to the complaint, Wysocki used Wtechlink funds to cover the check.

McDonald also accused Wysocki of continuing to use company money as he pleased. He moved $30,000 from Wtechlink’s general account into a personal savings account, he paid $617.05 for a “real estate education expense,” and he used company funds to buy a pair of Antelope Slingback sandals for $188 for a female office employee, among other complaints.

Wysocki defended those actions and more in his responses to the court. The company owns property, he explained, so knowing about real estate was a business expense. And the sandals are less expensive than the footwear the company provides to employees in the field.

McDonald won an injunction in June 2016 that blocked Wysocki from using Wtechlink money, hiring and firing employees and raising his own salary, which stood at about $10,000 a month. Still, McDonald asserted, Wysocki ignored the court order, removing more than $300,000 from Wtechlink in the first seven months of 2017 beyond his salary.

The case wound its way through court until this past June, when McDonald prevailed with a judgment against Wysocki for $471,000. To cover the debt, the Multnomah County Sheriff’s Office was to hold an auction to sell McDonald’s share of the stock.

Wysocki filed for Chapter 11 bankruptcy protection on July 28, four days before the auction. The petition for bankruptcy put an automatic stay on the stock sale.

Wysocki claimed his debt exceeded $1 million, according to the bankruptcy paperwork, which includes almost $244,000 in federal back taxes stemming from the Wtechlink money he used but never declared as income, another $76,000 in state taxes, and more than $500,000 to the Bank of Eastern Oregon. He also pegged Wtechlink’s value at about $3.1 million.

During the Sept. 19 hearing in U.S. Bankruptcy Court, Portland, Wysocki’s bankruptcy attorney, Joseph A. Field of Portland, said Carol Wysocki was providing her son $350,000, plus Byron Wysocki had more than $100,000 in another account, and his income would cover the rest of the debt to McDonald.

Wysocki on Wednesday described his mother’s funds as an investment in Wtechlink.

McDonald dropped out of the bankruptcy case on Oct. 5. He said staying in would cost him a lot in lawyer fees and cut into how much he should receive for his share of the company.

Wysocki also faced seven misdemeanor charges of telephonic harassment for text messages he sent to McDonald, including threats against McDonald and his wife McKennon McDonald, a schoolteacher and Pendleton city councilor.

“You had better hire a body guard [sic],” according to the transcript of texts. “Coming for your family dude [sic].”

Wysocki and McDonald settled that matter in the bankruptcy case, according to the “acknowledgment of satisfaction” statement McDonald provided to Umatilla County Circuit Court on Sept. 25.

“I do not desire to prosecute Byron Wysocki for any criminal charges or civil damage relating to the incident dates of July 31, through August 1 of 2017 and agree that any criminal charges related to me should be dismissed.”

According to bankruptcy court records, Wysocki has until Nov. 1 to provide a draft of how he will handle his debt.

McDonald said he works in Boardman for another fiber optic company, Windwave Communications, and has some plans but didn’t want to talk about them now. He also said when he left Wtechlink in August the company was bankable.

Wysocki also said the company continues to do well, growing each month since its inception. He also said the 100-200 bitcoins — digital currency — be bought in 2013 with Wtechlink funds has proved a worthy investment. The coins were about $20-$30 each then, he said, and are worth $5,000 a piece now. The bitcoins also were a source of contention in the first lawsuit.

Wtechlink also is raising its monthly rates $2 on all accounts starting Nov. 1. Wysocki said that was due to the uptick in Oregon’s minimum wage.

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Contact Phil Wright at pwright@eastoregonian.com or 541-966-0833.



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