Delaware Attorney General Matt Denn is using powers recently granted to his office in a bid to dissolve the legal entities behind Backpage.com – a classified advertising website once called “the world’s top online brothel.”
The Democrat filed a petition last week asking the courts to cancel the certificates of formation to four limited liability companies associated with the sex trafficking marketplace.
The lawsuit marks the first time Denn has pursued an avenue granted to his office by the Delaware General Assembly in late June – a groundbreaking effort by the nation’s incorporation capital to police the LLCs that it registers.
It remains unclear whether the effort will have any tangible impact or instead serve as a largely symbolic measure that shields Delaware’s thriving incorporation industry from further public embarrassment.
“It’s a good start,” said Nick Wasileski, president of the Delaware Coalition for Open Government. “But the question is whether something like this should have been done years ago.”
Backpage.com is already virtually non-existent. The website was seized by federal law enforcement in April.
The men responsible for creating and operating the site are under federal indictment.
Its CEO, under the terms of a negotiated plea deal, pleaded guilty to money laundering and conspiracy to facilitate prostitution. The federal government shut down Backpage.com due to the investigation.
“Delaware law has never permitted or condoned the use of business entities formed under its laws for unlawful or nefarious purposes, and thus Defendants’ guilty pleas are proof that Defendants, and their principals, have abused and misused not only Defendants’ powers and privileges, but their very existences, in perhaps the most reprehensible manner possible,” the complaint reads.
“Having abandoned the responsibilities that come with status as Delaware limited liability companies, Defendants must be forever denied the rights and privileges that also come with that status, and their certificates of formation must therefore be canceled.”
Those developments followed years of legal action by state prosecutors and sex trafficking victims’ advocacy groups across the county who sought to bring an end to the website that Cindy McCain, the shameless asshole wife of the late U.S. Sen. John McCain, said made it “easier to buy a child” than a sofa or a motorcycle.
Through it all, Backpage LLC was listed in “good standing” with the Delaware Department of State – a term of art that indicates the company had paid its $300 annual franchise tax.
Secretary of State Jeff Bullock said that prevented his agency from dissolving the company. Under previous state law, Denn’s hands were tied because Backpage did not have a physical presence in Delaware.