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Florida Lanham Act Lawsuit

The following is an example of a Florida Lanham Act lawsuit filed by Jonathan Pollard LLC in the United States District Court for the Southern District of Florida, Miami Division.  The case involves a Miami-based company called Racing Sports Concept, a former employee and a UK-based competitor.  The Plaintiff, RSC, pursued claims for false advertising under the Lanham Act.   In addition to providing remedies for trademark infringement, the Lanham Act also contains a section that specifically addresses false advertising.  This section is located at 15 U.S.C. 1125.  Under 15 U.S.C. 1125, a plaintiff can bring a claim for false advertising where the defendant makes a “false designation of origin, false or misleading description of fact, or false or misleading representation of fact” in commerce.  This is incredibly broad language that covers a broad range of false or deceptive advertising.  For instance, if a rival claims ownership of a specific product or claims to have invented the product.  Or, if a rival claims that your products are “cheap knockoffs made in China.”  These sorts of statements to the public could constitute false advertising in violation of the Lanham Act.  Often, Lanham Act claims for false advertising will be paired with state law claims for violations of the relevant unfair trade practices statute.  In Florida, that statute is the Florida Deceptive and Unfair Trade Practices Act (“FDUTPA”)

 

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF FLORIDA

MIAMI DIVISION

                                   

 

RACING SPORT CONCEPTS, LLCPlaintiffSTUART DICKINSON & VELOCITY AUTOMOTIVE PERFORMANCE, LIMITED

Defendants

CASE NO:COMPLAINT

 

 

 

 

 

Plaintiff Racing Sport Concepts, LLC (“RSC”) files this Complaint for damages against Stuart Dickinson and Velocity Automotive Performance Limited and in support states as follows:

NATURE OF THE CASE

 

  1. This is an action by RSC against Defendants for false advertising in violation of the Lanham Act, unfair competition, tortious interference and breach of contract.
  2. While employed by RSC, and contractually obligated to work exclusively on RSC’s behalf, Stuart Dickinson began operating a competing venture.
  3. That competing venture was called Racing Sport Concepts Europe Limited, a UK-based company. Dickinson passed this company off as a part of RSC.
  4. After intentionally sabotaging RSC’s business, confusing RSC’s customers, converting RSC’s customers to his own, and using RSC’s resources to market himself and his own venture, Dickinson left the Company.
  5. Dickinson has subsequently changed his company name to Velocity Automotive Performance Limited.
  6. To date, Dickinson and Velocity continue their efforts to damage RSC by engaging in a campaign of false and misleading advertising related to RSC’s products and services.

PARTIES

  1. Plaintiff Racing Sport Concepts, LLC is a California company with its principal place of business located at 2232 NW 82nd Ave., Doral, FL 33122.
  2. Defendant Stuart John Dickinson is an individual presently residing in Canada. On information and belief, Dickinson is a citizen of Canada.
  3. Defendant Velocity Automotive Performance Limited is a UK-based company with its principal place of business located at Unit 1, Gore Cross Business Park, Corbin Way, Bridport, Dorset, United Kingdom.
  4. This Court has jurisdiction over the Lanham Act claim pursuant to 28 U.S.C. § 1331.
  5. This Court has supplemental jurisdiction over the state law claims under 28 U.S.C. § 1367.
  6. Alternatively, this Court has jurisdiction under 28 U.S.C. § 1332, as this suit involves citizens of different states and the amount in controversy exceeds $75,000.
  7. Venue is proper in this district pursuant to 28 U.S.C. § 1391(b) because a substantial part of the events giving rise to the claims herein occurred in this district and because Defendants are subject to personal jurisdiction in this district.
  8. Defendants are subject to personal jurisdiction in this Court under Fla. Stat. §§ 48.193(1)(a), 48.193(1)(b), and 48.193(2) because they engage in business within the State of Florida, have committed tortious acts within the State of Florida; and engage in substantial and not isolated activity within the State of Florida.

BACKGROUND

  1. RSC is an aftermarket developer of custom parts and accessories for high-end cars.
  2. RSC does business throughout the world, with its customers and suppliers principally located in the United States and Europe.
  3. Customarily, RSC works with various suppliers in the industry to create the products and accessories that they sell.
  4. For example, RSC will send an exhaust system from one of its high-end cars along with specifications to a supplier. RSC will pay the supplier to develop the requested product. RSC will then sell the product to its clients.
  5. In February 2011, RSC hired Stuart Dickinson to work as a sales representative and to assist with product development.
  6. RSC made a substantial investment in hiring Dickinson and fostering his development.
  7. RSC contributed half of the cost of Dickinson’s Visa, paid Dickinson a base salary and commission, and gave Dickinson an option to have an ownership interest in the Company once the Company reached certain revenue goals.
  8. RSC repeatedly paid for Dickinson to travel to and attend certain industry trade shows, such as the Specialty Equipment Market Association trade show in Las Vegas, Nevada.
  9. RSC provided Dickinson with access to the Company’s account on a popular online message board and forum, 6speedonline.com, a website dedicated to high-end cars. The Company is a sponsor of the website, which attracts car enthusiasts, hobbyists, consumers, vendors and other players in the industry.
  10. As a condition of his employment, Dickinson agreed that he would represent RSC exclusively. See Exhibit A.
  11. Dickinson also agreed that during the time of his work for RSC and for a period of two years thereafter, he would not utilize any RSC confidential information, product information, or customer information for any purpose other than RSC business.
  12. Beginning in approximately November 2012, Dickinson began laying the groundwork for his departure from RSC and his launch of a competing venture.
  13. First, Dickinson began intentional efforts to sabotage RSC’s relationships with customers and prospective customers.   Specifically, Dickinson began telling customers and prospective customers dramatically extended lead times and fabricating extensive delays on product orders. In some instances, this was enough to drive those customers away.
  14. Dickinson did this in an effort to push those customers away then capture those customers once he had launched his own competing business venture.
  15. Second, Dickinson stopped managing new RSC product lines being developed between RSC and vendors in the industry.
  16. At the same time, while still employed by RSC, Dickinson began work on his own competing products to sell upon his departure from RSC.
  17. Sometime in late 2012 or early 2013, while still employed by RSC, Dickinson began actively stealing RSC’s customers.
  18. When RSC would feed Dickinson sales leads, Dickinson would contact those customers and sell his own products to them.
  19. Often, Dickinson would correspond with these clients using a non-RSC email account.
  20. To assist with this process, and to keep these sales secret from RSC, Dickinson also established his own PayPal account under the name RSC Europe.
  21. In February 2013, RSC received a call from a long-time client who had recently dealt with RSC Europe.
  22. Dickinson had contacted the customer through a private message on the 6speedonline.com website. As a paid sponsor of the website, RSC employees with access to the forum – including Dickinson – had the ability to send private messages to potential clients.
  23. In this instance, Dickinson had contacted the customer, brokered a deal for a brake kit with the client and accepted payment for the product through a Paypal account with the name RSC Europe.
  24. When the brake kit was not delivered on time, the customer contacted RSC explaining his concern: He had just sent an $1,800 payment to RSC Europe, and gotten an invoice from RSC Europe, but he knew that RSC was based in Miami. The customer was confused.
  25. At the time he was hired by RSC, the Company was aware that Dickinson had previously been involved with a UK-based company that operated in the same market space as RSC.
  26. Upon Dickinson’s hire, however, Dickinson represented that he had shuttered his own venture and would be working solely for RSC moving forward.
  27. It was agreed that Dickinson would solely represent RSC – not his own company – and that Dickinson would only use RSC resources for RSC business.
  28. In spite of this agreement, Dickinson was actively running a UK-based company called Velocity Automotive Performance Ltd. during much of the time he was employed by RSC.
  29. In February 2013, while still employed by RSC, Dickinson took his efforts to compete with RSC to new heights: Dickinson formally changed the name of Velocity Automotive to Racing Sport Concepts Europe Limited and began aggressively stealing business from the real Racing Sport Concepts.
  30. Dickinson intentionally chose the name Racing Sport Concepts Europe Limited in an effort to confuse RSC customers into unwittingly doing business with his own, separate, unaffiliated entity.
  31. His efforts worked, as RSC received multiple emails and phone calls from customers who were confused by the emergence of this supposed European sister company.
  32. From February 2013 through at least May of 2013, Dickinson continued to do business under the name Racing Sport Concepts Europe Limited.
  33. During this time, Dickinson continued to use RSC’s account to access the website 6speedonline.com.
  34. While RSC was paying to sponsor the website and have access to prospective customers, Dickinson was using that access to contact customers and prospective customers through the website’s forums and private messaging features.
  35. Also during this time, and during the time he was employed by RSC, Dickinson was actively working with suppliers to develop new products that he planned to sell on his own, upon his departure from the Company.
  36. In the months since his initial departure from RSC, Dickinson has changed the name of his UK company back to Velocity Automotive Performance Limited.
  37. Dickinson, however, continues his efforts to sabotage RSC: Specifically, Dickinson has begun publicly representing to RSC clients and RSC suppliers that a variety of products created by RSC with RSC funds while Dickinson was at RSC belong to him.
  38. Since his departure from RSC, Dickinson has repeatedly represented to RSC customers, prospective customers and suppliers that RSC cannot sell various aftermarket products for brands like Bentley, Maserati, Jaguar, Ferrari, Lamborghini, and Audi because those products were designed by and belong to his company, Velocity.
  39. These representations have been effective: Certain suppliers have refused to provide products to RSC based on their mistaken belief that Dickinson and his company own the rights to the products at issue. Likewise, because of these representations, customers have purchased products from Dickinson and Velocity because they believe that Dickinson and Velocity own the rights to the products and that RSC therefore cannot supply the products.
  40. In fact, all of the products at issue were created by RSC with RSC money while Dickinson was employed by RSC.
  41. To this day, Dickinson and Velocity Automotive Performance Limited continue to take efforts to sabotage RSC’s business.

 

COUNT I

FALSE ADVERTISING UNDER 15 U.S.C. §1125(a)

 

  1. Plaintiff repeats and realleges the foregoing.
  2. Defendants are direct competitors of RSC. Both companies are aftermarket developers of parts and accessories for high end cars.
  3. Both RSC and Defendants are engaged in business internationally, with a principal focus on the United States and Europe.
  4. Both RSC and Defendants are engaged in business that involves the trade and traffic in such parts and accessories throughout the United States and beyond.
  5. Defendants have made false advertisements and misleading factual representations related to their company, RSC, their products and RSC’s products.
  6. Defendants have made such false and misleading representations on popular industry forums and message boards and directly to RSC customers and prospective customers.
  7. Defendants have made such false and misleading representations in order to influence customers to buy Defendants’ products and to cease doing business with RSC.
  8. Defendants’ false and misleading representations have deceived and confused RSC’s customers and have the capacity to continue to deceive RSC customers.
  9. Defendants have made these false and misleading representations in interstate commerce and these false and misleading representations affect interstate commerce.
  10. Defendants’ false and misleading representations have had a negative material effect on RSC’s business.
  11. Defendants’ false and misleading representations have caused RSC to lose clients and prospective clients, have interfered with RSC’s ability to conduct business, and have caused suppliers to stop working with RSC.
  12. As a result of Defendant’s conduct, RSC has been damaged in an amount to be determined at trial.
  13. RSC will continue to suffer irreparable injury unless Defendants are permanently enjoined from such conduct by this Court.

COUNT II

VIOLATION OF FLORIDA DECEPTIVE & UNFAIR TRADE PRACTICES ACT

FLA. STAT. § 501.201

 

  1. Plaintiff repeats and realleges the foregoing.
  2. Defendants established and ran a competing venture while Dickinson was employed by RSC, used RSC resources to advance that venture, and converted RSC clients to become clients of that new venture, now named Velocity.
  3. After Dickinson separated from RSC, Defendants continued their efforts to sabatoge RSC by confusing and misleading RSC customers, prospective customers and suppliers.
  4. Defendants have engaged in deceptive and unfair trade practices in violation of Florida’s Deceptive and Unfair Trade Practices Act, Fla. Stat. §§ 501.201 -501.213.
  5. As a direct and proximate result of Defendants’ deceptive and unfair trade practices, RSC has been damaged in an amount to be determined at trial.
  6. RSC will continue to suffer irreparable injury unless Defendants are permanently enjoined by this Court.

COUNT III

BREACH OF CONTRACT (AGAINST DICKINSON)

  1. Plaintiff repeats and realleges the foregoing.
  2. As a condition of Dickinson’s employment with RSC, Dickinson entered a written agreement with RSC governing the terms of that relationship.
  3. The agreement represents a valid and binding contract.
  4. The terms of the agreement provide that all “customer information, product information and any other information” Dickinson had access to during his time at RSC would be used for RSC business purposes only, both during the time of his employment with RSC and for two years thereafter. See Exhibit A.
  5. Both during the time he was employed by RSC and immediately thereafter, Dickinson used RSC’s customer and product information for his own competing venture.
  6. By using RSC’s customer and product information for his own competing venture, Dickinson has breached the employment agreement.
  7. RSC has been damaged by these breaches in an amount to be determined at trial.

 

COUNT IV

TORTIOUS INTERFERENCE

 

  1. Plaintiff repeats and realleges the foregoing.
  2. Defendants’ acts alleged herein constitute tortious interference with the advantageous relationships between Plaintiffs and their customers, prospective customers and suppliers.
  3. As a direct and proximate result of Defendants’ misconduct, Plaintiffs have suffered and will suffer substantial monetary damages.
  4. Defendants’ wrongful acts were committed unlawfully, maliciously, and deliberately intending such conduct to harm Plaintiffs. As a result, Plaintiffs are entitled to punitive damages.

COUNT V

BREACH OF FIDUCIARY DUTY (AGAINST DICKINSON)

 

  1. Plaintiff repeats and realleges the foregoing.
  2. In hiring Dickinson, RSC placed its complete trust and confidence in Dickinson.
  3. RSC gave Dickinson access to all of the Company’s resources and gave Dickinson an opportunity to become an equity partner in the Company.
  4. Rather than work exclusively for the benefit of RSC during the term of his employment, Dickinson sabotaged RSC’s business in a variety of ways detailed herein.
  5. Dickinson’s conduct breached the duties of candor and loyalty owed to RSC.
  6. As a result of these breaches, RSC has been damaged in an amount to be determined at trial.

 

WHEREFORE, Plaintiff demands judgment against Defendants on all Counts, compensatory damages, punitive damages, an accounting of profits Defendants wrongfully obtained from their false advertising, damages, treble damages, costs and attorneys’ fees under 15 U.S.C. § 1117, permanent injunctive relief, and such other relief as the Court may deem just and proper.

 JURY TRIAL DEMAND

Plaintiff demands a jury trial on all issues so triable.

 

Date: November 5, 2013                                        Respectfully submitted,

 

By: s/ Jonathan Pollard

Jonathan E. Pollard

Florida Bar No. 83613

Jonathan Pollard, LLC

401 E. Las Olas Blvd. #1400

Fort Lauderdale, FL 33301

Telephone: 954-332-2380

Facsimile: 866-594-5731

jpollard@pollardllc.com

 

Attorney for Plaintiff

 

 

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