One of his deposition-dodging tactics is allegedly refusing to hand over relevant materials for discovery in Trinity’s breach of contract lawsuit. But the materials PBR has managed to acquire are pretty damning. Text messages from Merit Street’s chief operating officer Joel Cheatwood suggest a bankruptcy conspiracy, evidenced by the fact that he instructed employees to keep all communications off of their work emails. The texts (via The Independent) lay out a scheme to wind down operations at Merit Street while shifting staffers over to Envoy. “The way this will probably work is once MSM is wound down there will be an auction of assets and newco will bid to buy the MSM program library,” he explained in one text. He also texted that he and Merit’s Chief Executive Officer Ken Solomon needed to “be very careful with our public activities associated with Envoy since we are still full and active employees” of Merit, adding that any “[a]ctivities that would indicate we are more focused on Envoy could be problematic if called into question.”
“The Debtor and its executives knew the Envoy scheme was problematic and tried to conceal it by using only personal emails and texts. On June 30 (two days before the bankruptcy), Mr. Cheatwood instructed a colleague that ‘any communication involving timing of events, strategies, etc. we need to not use the merit street e-mail system. Use text instead,'” PBR’s filing reads. (PBR hasn’t outright sued Merit Street, but accused the company of failing to pay millions in owed payments.) “The documents produced to date demonstrate that this bankruptcy was conceived as a scheme to divert the Debtor’s employees and intellectual property to Envoy, a competing business Dr. Phil founded the day before this case was filed, and leave the Debtor’s business as a shell with nothing more than a repeated loop of re-runs.”
“By its own admission in a meet-and-confer between counsel on August 26, 2025, Peteski still has not produced all of Phillip C. McGraw’s emails and text messages (despite his deposition being scheduled to begin in less than 48 hours from the time of such conference), nor has it produced all of the documents concerning Envoy,” Trinity stated in its own filing (via Deadline). “Peteski’s same delay tactics persist. The pattern is so striking that it is more than mere déjà vu; it is a deliberate rerun, scripted by parties who have decided that the Court’s orders are optional guidance rather than binding directives.”
