IHRA cancels some 2026 events (8 Viewers)

[Jim]

The only thing I can say about this is, Darryl owned both and IMO his intention was to fund IHRA with Darana revenue which is legal and his decision being he owned both.

It may be legal, but it is not good business practice.

It is no different than an independent racer using his personnel business to fund his racing venture.

There are independent racers who have gotten themselves into financial problems by spending money they don't have.

We will all have to sit back and wait to see what comes of all this. I am still of the opinion that if
Darryl over billed for work and that work was not paid for which seems to be the claims at this point, they will each go their own way as fighting for the money is going to cost them a lot more money and the only people who will come out ahead are their lawyers.

I don't agree. I think the pressure and scrutiny of being a public company that answers to shareholders, analysts, and the SEC will not let SpaceX go its own way.

 

[Custom Body Fan]

In

they will each go their own way as fighting for the money is going to cost them a lot more money and the only people who will come out ahead are their lawyers.

There is probably no company on the planet that lets a half-billion dollars or more just go. In XAI’s case management and the board would be derelict in their responsibilities. In Darryl’s case he needs the money. He is a smaller fish and isn’t going to let a half-billion dollars walk out the door. He’s worked a long time for a payout and isn’t going to just let Elon keep it (that’s assuming he can find any powerful lawyers interested in taking the case)

The problem for XAI is Darryl says he doesn’t know where the money went, and I highly doubt he is in a position to pay what XAI wants. Plus he could certainly have violated the law and have the feds decide to go after him.

 

[ironpony]

Elon has not paid the bill so he is not out any money and Darryl keeps making the number bigger so IMO from what I understand he is owed maybe 150 million on paper and he is not going to beat Elon in court

 

[65 Goatboy]

The only thing I can say about this is, Darryl owned both and IMO his intention was to fund IHRA with Darana revenue which is legal and his decision being he owned both.
It is no different than an independent racer using his personnel business to fund his racing venture.
We will all have to sit back and wait to see what comes of all this. I am still of the opinion that if
Darryl over billed for work and that work was not paid for which seems to be the claims at this point, they will each go their own way as fighting for the money is going to cost them a lot more money and the only people who will come out ahead are their lawyers.

But isn't the bottom line, that he was "advertising" spending exorbitant amounts of money on the IHRA that he didn't have, counting on the huge Darana contracts revenue? Example's: race purses bigger then the Nhra and the unheard of TC and too aggressively buying up as many tracks as he could on contracts. The thing snowballed so fast and got so big and he had start to using fraudulent business practices at Darana to keep the IHRA a float. And of course those kind of schemes never work.

 

[ironpony]

But isn't the bottom line, that he was "advertising" spending exorbitant amounts of money on the IHRA that he didn't have, counting on the huge Darana contracts revenue? Example's: race purses bigger then the Nhra and the unheard of TC and too aggressively buying up as many tracks as he could on contracts. The thing snowballed so fast and got so big and he had start to using fraudulent business practices at Darana to keep the IHRA a float. And of course those kind of schemes never work.

This is not a bad thing. I would say if you are a homeowner you probably have a 15-30 year mortgage which you are relying on being gainfully employed to be able to pay it.
He was running a successful business that was making money and he was using that money to fund the IHRA. What ever the situation is, it has obviously unraveled. Not much different than if you were to lose your job and had to figure out how to pay your mortgage or be foreclosed on.
IMO anything you have financed can wind up in the same situation, only his has a lot more zero's on the end.
I am speaking as everything being done legally, if he was truly a con man that is a whole other story. At this point I believe it was just a bad situation and he had to bail out, if it is proven different I will change my opinion.

 

[sfw1960]

AND I thought armchair racing was interesting...


GREAT stuff guys!!!!!!!!!!!!!!!!!!!!!!

 

[GumbyWVU]

But isn't the bottom line, that he was "advertising" spending exorbitant amounts of money on the IHRA that he didn't have, counting on the huge Darana contracts revenue? Example's: race purses bigger then the Nhra and the unheard of TC and too aggressively buying up as many tracks as he could on contracts. The thing snowballed so fast and got so big and he had start to using fraudulent business practices at Darana to keep the IHRA a float. And of course those kind of schemes never work.

I agree but frauduent might be a bit strong; I'd say they were reckless practices, kind of along the lines of what Ken has been saying, which I also agree with. At least "reckless" for me, as I would be too conservative with money to do what Cuttell allegedly did.

edit - "Fraudulent" generally conveys there was intent from the get-go, I believe.

 

[Custom Body Fan]

Not much different than if you were to lose your job and had to figure out how to pay your mortgage or be foreclosed on.

I think it’s very different. If you lose your job of can’t make your payments, you get screwed when you get foreclosed. In the case of the IHRA, Darryl’s poor business judgment and potentially fraud screwed lots of drag racers, circle track racers, vendors to the IHRA, etc etc. etc. And I’ll add that is after somehow the story got publicized that he’d funded the whole thing for ten years. A lot of people believed that and didn’t suspect it actually was positioned to collapse instantly if things didn’t go right.

 

[Under_Pressure]

Well a house is a necessity- that might be more analogous to paying necessary business expenses with the payments.

I'd say this is more like you get a new job that pays many times what any job you have had before did. It seems a little too good to be true, it's in a new industry that has a definite gold rush/bubble feel to it, and the boss is known to be mercurial and demanding but hey, if they're offering you'll take it for as long as it lasts. But then you immediately finance a very expensive boat, knowing that the only way you can make the payments is if the paychecks (at your new high salary) keep coming in as expected, and if you don't get even one on time you will lose everything. No rational person would say that's a good idea.