Linuxgruven was a technical services firm that was designed to specialize in work with the
Linux Operating System . The firm was officially incorporated in the state of
Missouri in
February ,
2000 , by founders James Hibbits and Michael Lebb. Its doors closed on
March 8 ,
2001 . Linuxgruven had offices in eight U.S. cities including a headquarters office in
Clayton, Missouri , which is a
St. Louis, Missouri suburb. At its peak the company employed 106 people.
Linuxgruven's initial hiring and revenue plans were closely intertwined. The company placed advertisements in the Employment sections of local newspapers for
Network Engineering positions. Individuals who were officially labeled as
Human Resources personnel would offer job candidates a position with the company if they completed either a SAIR Linux certification or a proprietary Linuxgruven certification. In turn, Linuxgruven offered a four week training program for the certification process that initially cost $2,500. Near the end of the company's existence the price for training increased to $3,150.
Human Resources personnel were paid commissions based on the number of people who paid for the training program.
The stated reason for charging for training was to provide the company an immediate stream of income until the consulting services that Linuxgruven would provide sufficient operating
Revenue . In reality, most of the income that Linuxgruven received was directly from prospective employee training and not from technical support and services.
On
March 8 ,
2001 , all Linuxgruven offices shut their doors. Many employees also learned that their paychecks had bounced, that their
Health Insurance had not been paid, and that
Unemployment Insurance had also not been paid. Shortly after the business' failure, Hibbits issued a statement through the company public relations firm Propellerhead blaming the executive staff for the company's quick demise.
On
January 7 ,
2002 , the
Missouri Attorney General Jay Nixon filed a lawsuit against Hibbits and Lebb alleging deceptive business practices, among other things.
