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The forum typically draws hundreds of corporate executives and foreign government officials from around the world to New York City each year for two days of speeches and panel discussions focused on outsourcing, the process in which a company or government agency contracts with an outside firm, often in a different country, to perform services once done in-house. Last year, some 1,000 people representing more than 25 countries attended the event at the Jacob K. Javits Convention Center. This year, the forum was to be held on Wednesday and Thursday at the Marriott Marquis in Times Square.
But late last week and throughout the weekend, word had spread that the Global Sourcing Forum had been abruptly canceled. By Wednesday morning, the event’s Web site — globalsourcingforum.com — was a blank page with two green bars across the top. David Etzler, the chief executive of OutsourceWorld, the conference company that produces the forum, had told some attendees that the firm was seeking bankruptcy protection.
The forum’s cancellation illustrated the logistical, financial and legal fallout that happens when a long-planned global business conference is suddenly shut down in New York City.
Contingents from across the country and the globe — Bangladesh, China, Poland, Uruguay — had already arrived in New York and spent thousands of dollars in registration fees, sponsorships and hotel costs. Sleek brochures had been designed. Former and current executives of major corporations and institutions were scheduled to speak or sit on panels, including those from Johnson & Johnson, Viacom, Amazon.com and the World Bank. Hotel rooms and banquet space had been booked.
Officials from Ghana, seeking to create public-private partnerships out of the networking they would do at the forum, spent $20,000 from a project, financed by the World Bank, to be a co-sponsor of the event. Bangladesh spent more than $100,000 on sponsorship, airfare and hotel costs for a large delegation.
“The big question that we have is, there’s a lot of public funds tied up in this,” said Kevin Parikh, a panel moderator and the global chief executive of Avasant, a management consulting firm that represents the government of Ghana. “OutsourceWorld obviously had the sponsorship money of these organizations leading up to the conference. Where did that money go? The money was to be used for the event, or it should have been returned.”
The sudden cancellation left officials from countries like Poland moving quickly to host receptions and other events.
Frank Casale, the chief executive of the Outsourcing Institute, a professional association whose members were expecting to attend the forum, also hastily organized a free ad-hoc conference, to give stranded participants a place to meet and talk about the industry.
On Wednesday morning, away from the bustle of Times Square, about 60 people sat at a long conference table at a law office on Park Avenue. “There were a couple hundred people in town,” Mr. Casale said as the program was about to begin at Kelley Drye & Warren L.L.P. “We could only fit 60 in this room. It was first come first served.”
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A Marriott Marquis spokeswoman said the Global Sourcing Forum was canceled “because the client could not meet the terms of the contract,” though she would not elaborate.
Mr. Etzler declined to comment and referred questions to his lawyer.
OutsourceWorld’s bankruptcy lawyer, Philip J. Landau, said the company would seek bankruptcy protection and would be liquidated. Mr. Landau said several major sponsors of the event who had committed several hundred thousand dollars backed out at the last minute. “OutsourceWorld couldn’t then make the payment to the Marriott,” he said. “It’s in essence a domino effect.”
Mr. Landau, who said he could not name those sponsors who failed to pay, said none of the sponsorship money went to Mr. Etzler personally. “All of the money went into the event,” said Mr. Landau, who added that Mr. Etzler had not taken a salary in weeks, if not months, and had been “very distraught” over the ordeal.
Mr. Etzler, 39, lives in Boca Raton, Fla., and is a well-known figure in the global outsourcing industry. He called himself an “eco-enthusiast” in The Sun-Sentinel in Florida, and had organized a local green-living fair.
Several attendees criticized Mr. Etzler for failing to notify participants traveling from around the world that the event had been called off and accused him of mismanaging OutsourceWorld. Mr. Landau said Mr. Etzler had officially canceled the event last Thursday evening and later posted a statement to that effect on the Web site before the site was taken down, in addition to sending an e-mail to some attendees.
He said those who spent money on registration and sponsorship costs would be able to submit claims for reimbursement through liquidation proceedings.
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