That sucks, I would drop and distance yourself from him..
A lot of people came out in that thread about the way that piece of shit does business and how he treats people. As for the illegal accusations; an article was posted, who knows the legitimacy of it, but it sounds terrible anyway you slice it.
It may have originally been between him and shoehorn, but he brought all this upon himself. If he had such horrible relationships and a questionable past one really has to question his judgment to let a public thread like that spiral out of control. He could have paid the money his affiliate earned and it would have never gotten to this point, and I don't think this is the end of it, in my opinion it will get a lot worse in that thread.