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If Mike's logs are right the thing you're upset he didn't do wasn't part of the deal and was originally supposed to be built out by someone else.
Looking at the logs it also seems like where you guys dropped off in 2008 you had paid $5k for the first half and then sent some supplementary cash for additional labor for sorting out the data that was lost and throwing up the dev site to show the investor. The project stalled out after that and I don't see anything where the second half was paid to Mike.
Ben, unless you have your own logs to counteract what Mike has posted, prob best to cut your losses and walk away.
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