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Hayman Private Equity, LLC, Announces Dismissal of Lawsuit Against It With Prejudice on July 10th Tuesday 2012

CHICAGO--(BUSINESS WIRE)--Hayman Private Equity, LLC (“Hayman”) announced today that it recently obtained the dismissal, with prejudice, of all claims asserted against the company, its principals, and counsel in a lawsuit filed in the Circuit Court of Cook County, Illinois on March 14, 2011 entitled DGRP Management, LLC, et al. v. Roland Husner, et al., Case No. 11 L 2740. The three plaintiffs, DGRP Management, LLC, Environmental Service Professionals, Inc. (ESP, Inc.), and Riverside Premier Development, LLC, claimed in the suit that Hayman, its officers Andrew Bacik and Christopher Dieterich, Hayman’s outside counsel, Robert Masud, and others breached certain loan agreements and engaged in a scheme to defraud the plaintiffs in connection with certain failed financing transactions from which the plaintiffs had hoped to secure loans totaling $1.5 billion.

“We knew that the lawsuit against us was without merit, and that the allegations of fraud were entirely frivolous,” stated Hayman’s President, Andrew Bacik. “We also knew that if we fought the suit rather than accede to the plaintiff’s unreasonable demands for money, we would ultimately prevail,” Mr. Bacik added.

Hayman and Messrs. Bacik, Dieterich and Masud previously moved to dismiss the plaintiffs’ claims for failing to state a cause of action and for lack of personal jurisdiction, and on April 10, 2012, the court dismissed all but one count of the plaintiffs’ amended complaint against Hayman, and granted Messrs. Bacik, Dieterich and Masud’s individual motion to dismiss.

In addition to fighting against the plaintiffs’ unwarranted claims as alleged within the lawsuit, Hayman and Messrs. Bacik, Dieterich and Masud also had to contend with the fact that the false and defamatory statements against them had also been published over the Internet. On April 28, 2011, plaintiff ESP, Inc., published a document as part of a purported Current Report on Form 8-K (filed with the SEC’s online EDGAR system), which contained numerous false and defamatory statements about Hayman, its principals and counsel similar to those made in the lawsuit. Hayman advised the plaintiffs of its intent to sue them for defamation based on the Internet publication of the false and defamatory statements unless the plaintiffs dismissed their lawsuit with prejudice. “Although statements made within a judicial proceeding are generally immune from suit for defamation,” explained Hayman’s attorney, Daniel J. Becka, “the judicial privilege is not so broad as to protect false and defamatory statements made outside the courthouse to the world over the Internet.”

On April 23, 2012, plaintiff DGRP Management, LLC, agreed to the dismissal of all of its claims asserted in the action against all defendants, with prejudice, barring it from ever re-filing its lawsuit. On May 21, 2012, Hayman filed a Counterclaim for Defamation and Conspiracy against the remaining two plaintiffs, and on June 29, 2012, plaintiff Riverside Premier Development also agreed to the dismissal of all of its claims asserted in the action against all defendants, with prejudice. On June 29, 2012, the court also dismissed all of the claims of the sole remaining plaintiff, ESP, Inc., for its failure to comply with prior court order regarding the litigation. Hayman’s Counterclaim for Defamation against ESP remains.

“Although the complaint never should have been filed in the first place, we feel somewhat vindicated with the dismissal of the plaintiffs’ claims in the lawsuit, and the viability of our remaining suit for defamation,” commented Christopher Dieterich, one of Hayman’s managing members and a California securities lawyer. “It’s ironic that ESP felt the need to publish its baseless lawsuit against us as part of a Current Report on Form 8-K filed with the SEC, when it was neither “current” (having not filed a financial report since September 30, 2009, and an audited statement over 2 years ago, for December 31, 2008), nor consistent, in that no mention of our lawsuit filed on May 21, 2012, against this publicly-traded company for defamation has been made in any SEC filings since then. In fact, no filings have been made by the company on the SEC’s EDGAR system since the baseless lawsuit against us was filed,” Mr. Dieterich added.

According to the last Annual Report on Form 10K-A filed by ESP on April 4, 2011 (restating the company’s financial statements for the years ended 2007 and 2008), ESP’s auditors raised “substantial doubt about [ESP’s] ability to continue as a going concern,” as it had incurred losses of almost $20 million in 2007 and 2008, had a negative working capital of about $9.2 million, and was in default on substantially all of its term debt of approximately $5.2 million. “This confirmed to us what we all believed to be its motivation for filing this fallacious lawsuit; that its very survival was wholly dependent upon its ability to generate cash or obtain financing in whatever way possible,” commented Mr. Masud, one of Hayman’s outside counsels and a Boston based international business lawyer.

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