Consider this a prequel to this morning's post about the Boca business dealings of Howard Needle. That post begged the question: Where did Needle get the original electronic cigarette that proved such a valuable tool for luring an investor like Richard Gladstone? It's a story that Ron MacDonald can tell.
As he explains in the comments field of that post, MacDonald is the founder of Crown7, an e-cigarette company based in Scottsdale, Arizona. Needle was still publishing the doomed luxury magazine, Cravings Palm Beach, when last September, MacDonald says he got a phone call from Needle in which he claimed to have a quarter-million dollars he wanted to invest on a Crown7 infomercial. To MacDonald, who says he can usually trust his instincts for bullshit, Needle sounded like some 70-year-old with deep pockets -- a demographic that, after all, is common to Boca. So he sent Needle about $500 in e-cigarette supplies, along with a bill. Below, the video from Crown7.com shows the kind of e-cigarettes he sent and which Needle smoked at the lounge, leading to his fateful encounter with Gladstone.
MacDonald also flew to Boca to meet with this big shot investor in person. Let's just say Needle didn't make a great impression.
"He was working out of this little office for Cravings Palm Beach," says MacDonald. "You know the type -- they've got a receptionist up front who answers the phone for five different businesses." Needle also neglected to mention over the phone that he had a rather checkered past. "The first day I meet him he tells me about Wooden Nickel," says MacDonald, referring to the FBI sting of a crooked futures trading business in New York, for which Needle gave a guilty plea for extortion and racketeering.
Plus, one more detail that had been overlooked: Needle didn't actually have a quarter-million to invest with MacDonald. Rather, he wanted MacDonald to invest $25,000 with him.
"I said, 'Fuck, I can't deal with this guy,'" MacDonald recalls. "And here I've got 3-4 days down here." With nothing better to do, MacDonald hit the bar with Needle. After some time, MacDonald decided this was "personable guy" and he drew up a contract for Needle that was loaded with conditions that protected MacDonald from losing anything from the deal, besides the $500 unpaid bill from the e-cigarette starter kit.
After MacDonald flew back to Arizona, Needle kept calling and e-mailing with requests for money and materials. It had become clear to MacDonald that Needle "doesn't know how to do anything legitimately." It didn't help when Needle's calls took a hostile turn. "He threatened me over the phone," says MacDonald. "He said he was going to kick my ass." MacDonald, who says he's 6-feet and 240 pounds says he told the smaller, skinnier Needle, "Hey, if you think you've got it in you, go ahead and take a chance.'"
Over the phone, MacDonald scrolled through old emails. He read one in which Needle claims a binding contract and hints at a lawsuit. MacDonald's three-word reply: "Fuck off loser." For the attorneys who called later on Needle's behalf, he offered slightly more tactful words, but with the same point.
MacDonald had long since forgotten about Needle until he saw the Juice post of this morning and learned that Needle was using the e-cigarettes that he still hadn't paid for as a way of not only luring new investors, but the kind who just might compete with MacDonald's Crown7.
MacDonald has not phoned Needle's probation officer, Kathy Kosior-Nelson, though he's thought about it. He says he doesn't believe the encounter constitutes fraud, exactly, "but he definitely ripped me off."