Source: https://www.scribd.com/doc/215058947/Glynn-et-al-v-Christy-et-al
Timestamp: 2016-02-06 12:40:24
Document Index: 184613470

Matched Legal Cases: ['§ 1051', '§ 1331', '§ 1121', '§ 1', '§ 256', '§ 271', '§ 1051', '§ 101', '§ 1301', '§ 1367', '§ 1391', '§ 278', '§ 1', '§ 256', '§ 256', '§ 256', '§ 283', '§ 284', '§ 1051', '§ 1125', '§ 1125', '§ 360', '§ 349', '§ 101', '§ 501', '§ 276', '§ 277', '§ 284', '§ 285', '§ 284', '§ 1961', '§ 1114', '§ 1125', '§ 1117', '§ 1118', '§ 1117', '§ 1114', '§ 1125', '§ 504', '§ 504']

UploadSign inJoinBooksAudiobooksComicsSheet MusicScribd Selects BooksHand-picked favorites from our editorsScribd Selects AudiobooksHand-picked favorites from our editorsScribd Selects ComicsHand-picked favorites from our editorsScribd Selects Sheet MusicHand-picked favorites from our editorsTop BooksWhat's trending, bestsellers, award-winners & moreTop AudiobooksWhat's trending, bestsellers, award-winners & moreTop ComicsWhat's trending, bestsellers, award-winners & moreTop Sheet MusicWhat's trending, bestsellers, award-winners & moreCategoriesArts & IdeasBiography & MemoirBusiness & LeadershipChildren'sComputers & TechnologyCooking & FoodCrafts & HobbiesFantasyFiction & LiteratureHappiness & Self-HelpHealth & WellnessHistoryHome & GardenHumorLGBTMystery, Thriller & CrimePolitics & EconomyReferenceReligionRomanceScience & NatureScience FictionSociety & CultureSports & AdventureTravelYoung AdultCategoriesArts & IdeasBiography & MemoirBusiness & LeadershipChildren'sComputers & TechnologyCooking & FoodFantasyFiction & LiteratureHappiness & Self-HelpHealth & WellnessHistoryHome & GardenHumorLGBTMystery, Thriller & CrimePolitics & EconomyReferenceReligionRomanceScience & NatureScience FictionSociety & CultureSports & AdventureTravelYoung AdultCategoriesAdaptationsChildren’sCrime & MysteryFictionHumorMangaNonfictionRomanceSciFi, Fantasy & HorrorSuperheroesYoung AdultPublishersArcanaArchie ComicsBOOM! StudiosDynamiteIDW PublishingKingstone ComicsMarvel ComicsSpace Goat ProductionsTop Cow ComicsTop Shelf ProductionsValiant Comics ZenescopeDifficultyBeginnerIntermediateAdvancedMixedInstrumentBrassDrums & PercussionGuitar, Bass, and FrettedPianoStringsVocalWoodwindsGenreClassicalCountryFolkJazz & BluesMovies & MusicalsPop & RockReligious & HolidayStandardsP. 1Glynn et. al. v. Christy et. al.Glynn et. al. v. Christy et. al.|Views: 15|Likes: 0Published by PriorSmartOfficial Complaint for Patent Infringement in Civil Action No. 1:14-cv-01924-LTS: Glynn et. al. v. Christy et. al. Filed in U.S. District Court for the Southern District of New York, the Hon. Laura Taylor Swain presiding. See http://news.priorsmart.com/-la9j for more info.Official Complaint for Patent Infringement in Civil Action No. 1:14-cv-01924-LTS: Glynn et. al. v. Christy et. al. Filed in U.S. District Court for the Southern District of New York, the Hon. Laura Taylor Swain presiding. See http://news.priorsmart.com/-la9j for more info.More info:Categories:Types, Business/Law, Court FilingsPublished by: PriorSmart on Mar 28, 2014Copyright:Public DomainAvailability:Read on Scribd mobile: iPhone, iPad and Android.download as PDF, TXT or read online from ScribdFlag for inappropriate content|Add to collectionSee moreSee lesshttps://www.scribd.com/doc/215058947/Glynn-et-al-v-Christy-et-al03/28/2014pdftextoriginalUNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK __________________________________________________ FREDERICK TERRY GLYNN andGERY SAMPERE Individually, and on Behalf Of AIR BAK TECHNOLOGIES, Case No. LLC and JULIEN NIEVESS, Plaintiffs, vs. PHILLIP TROY CHRISTY, AIR BAK TECHNOLOGIES, LLC and AIR BAK TECHNOLOGIES CORP., Defendants, __________________________________________________ Plaintiffs, FREDERICK TERRY GLYNN, GERY SAMPERE (Individually, and on Behalf Of AIR BAK TECHNOLOGIES, LLC) and JULIEN NIEVESS, by and through their undersigned attorneys, VERNER SIMON, as and for their Complaint against the Defendants in this action, allege as follows: COMPLAINT
INTRODUCTION 1. This is an action to recover damages for patent infringement, copyright infringement and
trademark infringement, breach of fiduciary duty, misappropriation of a corporate opportunity, breach of the implied covenant of good faith and fair dealing, breach of contract, tortious interference with business, conversion, equitable accounting, declaratory relief, rescission, and temporary, preliminary, and permanent injunctive relief. The action arises from the Defendant, PHILLIP TROY CHRISTY’s, theft, pirating, arising out of the membership of Plaintiffs, FREDERICK TERRY GLYNN and GERY SAMPERE, and defendant PHILLIP TROY CHRISTY in AIR BAK TECHNOLOGIES, LLC (“AIR BAK” or the “LLC”), and the surreptitious taking of the intellectual property and company assets and sale of them to a third
party without adequate disclosure of the nature of the transaction and without authority to engage in such a transaction. Also, the Plaintiffs are suing AIR BAK derivatively as members of the LLC.
PARTIES 2. Plaintiff FREDERICK TERRY GLYNN (hereinafter “GLYNN” or collectively
“Plaintiffs”) is and was at all times relevant to this Complaint an individual domiciled the state of California residing at 4008 Marcus Ave, Newport Beach, CA 92663. GLYNN at all relevant times was and is a Member and the Member Manager of the LLC. GLYNN is suing individually and derivatively as a Member and the Member Manager of the LLC. At all relevant times GLYNN was held out by AIRBAK as the day to day Manager or CEO. 3. Plaintiff GERY SAMPERE (hereinafter “SAMPERE” or collectively “Plaintiffs”) is and
was at all times relevant to this Complaint an individual domiciled the state of New York residing at 55 Hammond Ridge Road, Armonk, NY 10504. SAMPERE at all relevant times
was and is a Member of the LLC. SAMPERE is suing individually and derivatively as a Member of the LLC. At all relevant times, SAMPERE was the financial arm of the LLC having invested over $800,000 in the AIRBAK. 4. Plaintiff JULIAN NIEVESS (hereinafter “NIEVES” or collectively “Plaintiffs”) is and
was at all times relevant to this Complaint an individual domiciled the state of New York residing at 51 Cox Ave., Armonk, NY 10504. 5. Defendant PHILLIP TROY CHRISTY (hereinafter “CHRISTY” or collectively
“Defendants”) is and was at all times relevant to this Complaint a citizen of the state of New York residing at 52 Martin Road, Hopewell Junction, NY 12533. As set forth in the facts
described below, CHRISTY was at certain relevant times a Member of the LLC. 6. AIR BAK TECHNOLOGIES, LLC (hereinafter “the LLC” or “AIR BAK” or “the
NOMINAL AIR BAK DEFENDANT”) is a Delaware limited liability company which was duly formed in or about December 2009 by Plaintiffs, GLYNN, SAMPERE and the Defendant CHRISTY, under the laws of Delaware, which was also a duly registered foreign LLC authorized to conduct business in the State of New York and which, was situated and conducting business in the State of New York, County of New York during the events described below in this Complaint. The LLC is sued herein as a Defendant. 7. Defendant AIR BAK TECHNOLOGIES CORP. (hereinafter “CHRISTY’S AIR BAK
COMPANY” or “DEFENDANT FAKE AIR BAK” or “DEFENDANT AIR BAK CORPORATION”) is or was a Delaware corporation formed by Defendant CHRISTY for the sole purposes of: (1) confusing the LLC’s business associates and the public by its similarity in name with the LLC; and (2) supporting and facilitating Defendant CHRISTY’s illegitimate goal, as set forth below, of expropriating the patents irrevocably licensed to the LLC and the business of the LLC. Upon information and belief, CHRISTY’S AIR BAK COMPANY, under the control of Defendant CHRISTY, operates office in the Bronx, New York as well as in other parts of New York and in China in furtherance CHRISTY’s illegal and illegitimate goals.
JURISDICTION and VENUE 8. This is an action for federal claims of infringement of patent, false designation of
origin in violation of the Lanham Act, 15 U.S.C. § 1051 et seq., trademark infringement, copyright infringement and unfair competition in relation to each. The action also asserts supplemental claims for breach of fiduciary duty, breach of patent license contract, theft of
company assets and self-dealing and unjust enrichment pursuant to the statutory and common law of New York. 9. This Court has subject matter jurisdiction over this action pursuant to the patent,
trademark and copyright laws of the United States pursuant to multiple federal statutes including but not limited to 28 U.S.C. §§ 1331, 1338(a), 1338(b), and 15 U.S.C. § 1121. The Patent claims are brought pursuant to 35 U.S.C. § 1, et seq., 35 USCS § 256 and 35 USCS § 271. The trademark claims are brought pursuant to 15 U.S.C.S. §§ 1051 et seq. The copyright claims are
brought pursuant to 17 U.S.C. § 101 et seq. and 17 U.S.C.S. §§ 1301 et seq. This Court has supplemental jurisdiction over the state-law claims under 28 U.S.C. § 1367(a). 10. 11. Venue in this District is proper pursuant to 28 U.S.C. §§ 1391 (b) and (c) and 1400(b).
This Court has personal jurisdiction over Defendant under New York Civil Practice
Law and Rules 301 and 302(a) because, upon information and belief: (i) Defendants are domiciled and/or are registered to do business in New York and do continuous and systematic business in New York and in this District; (ii) Defendants have transacted business in New York and contracted to supply goods or services in New York in connection with matters giving rise to this suit; and/or (iii) Defendants regularly do or solicit business in New York, and/or derive substantial revenue from goods used or services rendered in New York, and/or expect or reasonably should expect their infringing conduct to have consequences in New York and derive substantial revenue from interstate commerce.
STATEMENT OF FACTS AIR BAK TECHNOLOGIES, LLC, Formed in December 2009, Was Structured to Exploit Patents By Licensing and Selling Proprietary Backpack Products Worldwide. Defendant CHRISTY Irrevocably Licensed all Interest in The Operative Patents to the LLC As His Investment in the LLC. 12. Plaintiffs repeat and reallege each and every fact set forth in the preceding Paragraphs of
the Complaint as though each were fully set forth here at length. 13. Starting on or about December 16, 2009 and continuing until present date, Plaintiffs
GLYNN and SAMPERE, and Defendant CHRISTY, were Members, and the only Members, of the LLC and holders of one hundred percent of the membership interests in the LLC. 14. Defendant CHRISTY invested his patent for an inflatable bladder system to be used in
AIR BAK’s backpacks to be produced and sold, the primary product of AIR BAK and CHRISTY assigned the patent exclusively and irrevocably. GLYNN invested his labor and organizational skills as well as prior assignments in the CHRISTY patent which he had obtained before the formation of AIR BAK. SAMPERE invested money (ultimately to the sum of $800,000.) 15. On December 16, 2009, the Members entered into an agreement entitled “Limited
Liability Company Agreement” (hereinafter the “Operating Agreement”). (The Operating Agreement is attached to this Complaint as Exhibit 1 and hereby incorporated by reference.) The Operating Agreement provided, among other provisions: A. Purpose The purpose of this Company is to exploit the patent(s) and patent applications listed in Exhibit A attached hereto and by this referenced incorporated into this Agreement (the Patents) by licensing and/or selling the proprietary backpack air bladder system ("Comfort-pack") and selling backpacks with and without Comfort-pack system worldwide. [3] B. Capital Contributions...F. Terry Glenn will contribute all contracts as well as current and future revenue pertaining to the patented bladder system...
Agreement attached in Exhibit B and will include an assignment of all of his right, title and interest in and to the Patents and the intellectual property related to the Patents. [ 6a] Terry GLYNN will contribute all contracts as well as, current and future revenue pertaining to the patented bladder system... The value of this contribution is estimated at $215,000. [6b.] C. Distribution of Profits/Losses and Equity Ownership ... The Net Profits or Losses of the Company and Equity Ownership, for both accounting and tax purposes, will be distributed between the Members in the following manner: Phillip Troy CHRISTY- 33.33%; F. Terry GLYNN- 33.33%; Gery SAMPERE- 33.33%. [7] D. Management ...The initial Managers ofthe Company, until their successors or any additional Managers have been appointed, shall be Phillip Troy CHRISTY, F. Terry GLYNN and Gery SAMPERE. [ 11.1a.] The Company shall be managed by the Managers and the conduct of the Company's business shall be controlled and conducted by the Managers in accordance with this Agreement. [11.1d] E. Management ... The following decisions of the Managers will require a 67% super majority consent: 1) To remove any of CHRISTY, GLYNN, or SAMPERE as Manager. [11.lg.] F. Management…. The following decisions require consent of GLYNN and CHRISTY: 1.) To sell, assign or otherwise transfer the Company with the ownership of the Patent included for a price of less than 15,000,000 dollars. [11.1(h)(i)(1)]
The business of the LLC was to otherwise sell, exploit, market, and optimize the use of
the Patents in conjunction with licensing and/or selling the proprietary backpack air bladder system. 17. In conjunction with executing the Operating Agreement, each Member also entered into
an Agreement entitled, Patent License Agreement (the “Patent License Agreement”) which was expressly incorporate into the Operating Agreement and made part as "Exhibit B" to the Operating Agreement. (The Patent License Agreement is attached to this Complaint as Exhibit 2 and hereby incorporated by reference.) The Patent License Agreement provided, among other
provisions: A. Recitals... Whereas, Licensor is the inventor of an inflatable bladder for cushioning backpacks and has applied for a U.S. patent (U.S. Patent Application Serial No. 111101,044). Licensor has also filed for Patents in China, India, Mexico, and Canada and has filed a worldwide PCT. Whereas, subject to the terms and conditions of this Agreement and Licensee's Operating Agreement, Licensor is willing to grant the license provided herein. [Licensor is Phillip Troy CHRISTY.] B. Grant of License. Licensor [DEFENDANT CHRISTY] hereby grants to Licensee an exclusive, royalty-free license to use the Patents in the Territory in connection with the use, manufacture, importing, exporting, marketing, merchandising, promotion, distribution and sale of Licensed Products, together with the right to grant SubLicenses of the Patent.... Licensor agrees that he shall not use, and shall not grant a license to any third party to use, the Patent on products of any kind during the Term hereof. [1] C. Term. This Agreement shall become effective as of the date of execution hereof and shall continue in full force and effect; provided, however, that in the event that Licensor shall have assigned the Patent to Licensee as contemplated in Section 6 hereof, this Agreement shall automatically terminate except for the purposes referred to in Section 8 hereof. [3] D. Assignment of Patent. Licensor agrees that in the event of a sale of Licensee that Licensor will be obligated to and shall assign the patent irrevocably and unconditionally to Licensee, free and clear of all liens and encumbrances, and that this Agreement shall terminate. The Operating Agreement states that in the event the company sells for less than Fifteen Million ($15,000,000), then unanimous consent by members of AIR BAK TECHNOLOGIES, LLC is needed for the sale to go through.... [6]
Under controlling statutory and common law, each of the Members and Managers had a
fiduciary duty to the other Members and Managers and to the LLC. 19. Also, under the Operating Agreement, each of the Members and Managers had a
fiduciary duty to each other and the LLC to act in good faith and not to commit acts of fraud, bad faith or willful tortious misconduct as to the Property, Patents, or otherwise. 20. Furthermore, under the Operating Agreement and the License Agreement, any purported
sale of the LLC that included the Patents required the consent of Plaintiff GLYNN.
Plaintiff GLYNN Individually Owned 50% Interest in the Patents Prior To the Formation of AIR BAK TECHNOLOGIES, LLC. Defendant CHRISTY Admitted GLYNN's Ownership Interest as Stated in Section 6 of the Operating Agreement. 21. Prior to forming AIR BAK TECHNOLOGIES, LLC and prior to executing the
Operating Agreement and Patent License Agreement, Plaintiffs GLYNN and Defendant CHRISTY had prior dealings whereby GLYNN purchased 50% interest in the Patents. 22. In 2006, Plaintiff GLYNN entered into a transaction with Defendant CHRISTY whereby
GLYNN paid CHRISTY $100,000 personally and contributed $50,000 into a company called Ergodynamics, LLC. The purpose of this company originally was to market and otherwise exploit the backpack technology. 23. Subsequently, Defendant CHRISTY verbally acknowledged that GLYNN owned 50% of
the patents in exchange for an additional personal contribution from Plaintiff GLYNN to Defendant CHRISTY in the amount of $25,000. 24. As previously stated and evidenced by the terms of the Operating Agreement, Plaintiff
GLYNN and Defendant CHRISTY both contributed an assignment of all their right, title and interest in and to the Patents and the intellectual property at the time AIR BAK TECHNOLOGIES, LLC was formed. (See Section 6b to Operating Agreement). Defendant CHRISTY executed this Agreement and expressed no objection to Plaintiff GLYNN 's agreed capital contribution.
AIR BAK TECHNOLOGIES, LLC Was Successful From Formation Until the Misconduct by Defendant CHRISTY 25. At the time that the Members, GLYNN, SAMPERE and CHRIST, entered into the Operating
Agreement, the Members agreed that Plaintiff GLYNN would assume the role of Chief Executive Officer and be responsible for the day-to-day operations of the LLC. In 2010, the LLC hired appropriate personnel and successfully designed and manufactured sic (6) different lines of samples, set up a sample room in China, manufactured and imported approximately 53,000 units, trademarked the name, brand, and likeness of “AIR BAK” and otherwise began making successful sales and transactions. (This company development during the year 2010 had much to do with the efforts, designs and intellectual property of Plaintiff NIEVES as set for the below). 26. These business successes continued. Specifically, units were sold to approximately 30 college bookstores, Ritz Camera retail locations, Price-Smart and TJ Maxx companies. GLYNN personally visited over 20 of the USA's retailers in the fall of 2010 and sold programs for 2011. The LLC was successful and sold to Academy Sports and Outdoors in an "end cap" position, BJs Wholesale, Dunhams Sports, Sports Authority and many others. 27. During this same timeframe, the AIR BAK enrolled 2 distributors including RMP Athletic Locker and AIR BAK Korea and set up collaboration with TOCAD America for sales of photo bags all through the USA retailers. AIR BAK got its online store and web site perfected and started an effective internet marketing campaign. AIR BAK's supply chain with container ships and warehousing was established along with appropriate software to account for the inventory and operations. AIR BAK obtained placement on 12 separate TV segments, 5 magazines, and 24 newspapers. AIR BAK was awarded Disney Preferred Vendor and was featured in the ESPN Winter X games in January of 2011. In this venue, AIR BAK was featured on the podium for all 1st, 2nd and 3rct place winners. This resulted in international TV coverage.
28. AIR BAK was then enrolling distributors in Australia (Cache Group), Europe (Heelys) and Asia (Primer Group). AIR BAK has also been approached by Force 21 to sell military and EMT bags to 140 countries in a Licensing arrangement and is in the process of negotiations with the US Marine Corp and Chinese Military. (This company development and success during the year 2010 described in the preceding paragraphs of the Complaint had much to do with the efforts, designs and intellectual property of Plaintiff NIEVESS as set for the below).
Summary of Investor Relations 29. As recent as February, 2011 GLYNN obtained a Letter of Intent from a potential investor which committed investments equaling $800,000 of equity financing as well as $1,000,000 in debt financing. Under the terms of this transaction, Defendant CHRISTY and Plaintiff GLYNN agreed to split the remaining equity of the LLC on a 50%/50% basis. The investor agreed to accept 30% equity in the LLC in exchange for his investment. Defendant CHRISTY refused to accept this deal. (A true and correct copy of the Letter of Intent is attached to this Complaint as Exhibit 3 and incorporated by reference.) 30. In early March, 2011 GLYNN obtained further financing for accounts receivables through a factoring agent, Coral Capital Solutions. This entity provided working capital in the amount of $190,000. In exchange, GLYNN provided a Second Trust Deed on his personal home in order to secure the capital advance and SAMPERE guaranteed $50,000. 31. As recent as May 30, 2011 GLYNN obtained a Memorandum of Understanding from Anchor Finance Group, LLC for the purpose of obtaining equity and debt financing for the LLC. Under the terms of this proposed transaction, Anchor Finance Group, LLC agreed to arrange equity financing and included a pre-approved Letter of Credit in the principal
amount of approximately $1,200,000. In addition, Anchor Finance Group, LLC secured a stand-by Letter of Credit in the amount of $500,000. This proposed transaction further included approximately $2,000,000 in equity financing. (A true and correct copy of the Memorandum of Understanding is attached to this Complaint as Exhibit 4 and hereby incorporated by reference.) 32. As recent as June 1, 2011, Heelys Corporation had proposed a purchase of a majority stake in the LLC. Heelys Corporation is a well-established distributor and manufacturer of children's shoes with roller-skate type bottoms. Heelys Corporation then proposed a valuation of approximately $6,000,000 for the LLC and the terms of a proposed purchase were still being discussed as of 2012 prior to State Supreme Court and Bankruptcy Court litigation described below. As discussed further below, Defendant CHRISTY prevented this deal from being completed and otherwise unlawfully interfering in this transaction in bad faith.
Defendant CHRISTY's Misconduct In Relation to His Duties As A Member of The LLC 33. On April 13, 2011 Defendant CHRISTY presented a financing deal to the other Members of the LLC. This deal proposed a transaction with a publicly-traded "shell" corporation by the name of RAMCO. Under the terms of this proposed transaction, Defendant CHRISTY was to receive 30% equity in RAMCO corporation. Surprisingly, under the proposal farmed by CHRISTY, Plaintiff GLYNN was only to receive 5% equity in the new company. In addition, GLYNN would not have any management position nor be a member of the board of directors. To the contrary, Defendant CHRISTY negotiated a management position and seat
at the board of directors for himself. 34. GLYNN refused to agree to these terms as they were extremely unfavorable, ambiguous, and unknown. Despite this, Defendant CHRISTY told GLYNN that he was moving forward with the deal and that GLYNN could either accept the 5% and execute the transaction or he would receive nothing going forward. 35. It was subsequently discovered by GLYNN and SAMPERE that the RAMCO deal was actually brought to CHRISTY by Mr. Joe Speyer, who was CHRISTY’s right hand man , and, upon information and belief, a shareholder in AIR BAK TECHNOLOGIES CORP. 36. During this period of time, Defendant CHRISTY, had campaigned against GLYNN with SAMPERE and informed SAMPERE that GLYNN was not performing satisfactorily. As a result of his convincing, CHRISTY also convinced SAMPERE to sign a resolution dated April 14, 2011 removing GLYNN as the Manager of AIR BAK. (A true and correct copy of this purported resolution is attached to this Complaint as Exhibit 5 and hereby incorporated by reference.) 37. However, the subject resolution was invalid because a supermajority under the Operating Agreement was 67%, however, between SAMPERE and CHRISTY, they only controlled 66.67% of the shares in AIR BAK. [In any event the resolution was rescinded by
SAMPERE when he entered into a June 18, 2011 agreement with GLYNN and RAMCO where GLYNN and SAMPERE actually do constitute a Supermajority of AIR BAK’s membership. ] 38. GLYNN and CHRISTY seemed to have reconciled their differences in May 2011 and were conducting business affairs amicably. Heelys, AIRBAK LLC's European Distributor was having great sell-throughs in Europe was interested to talk to GLYNN and CHRISTY about a
transaction. GLYNN and CHRISTY flew out to Dallas on June 1, 2011 to meet with Heelys’ CEO, CFO and CMO. Heelys was interested in buying 100% of AIR BAK and wanted the LLC to work with its investment bankers on structuring a deal. 39. At a later date, (the Fall of 2011), SAMPERE was told by Heely’s CFO that Heely’s had offered $3 million for 100% of AIR BAK directly to CHRISTY. However, CHRISTY had unilaterally deemed that offer to be too low and never relayed SAMPERE or GLYNN. 40. Also on April 13, 2011, a factoring entity known as Coral Capital found out that a lien was put on all the assets of AIR BAK and froze the activity. The lien was a result of CHRISTY’s secret Agreements made with RAMCO, including, a Loan Agreement and Promissory Notes in April 2011 upon which a default was eventually taken. 41. On June 4, 2011, in his effort to pirate AIR BAK and freeze SAMPERE and GLYNN out, CHRISTY shut down AIR BAK’s email accounts and then, only on June 8, 2011, delivered to GLYNN, the April 14, 2011 Resolution (Exhibit 5) purporting to remove GLYNN as the Manager. CHRISTY then made it clear by his other conduct in May and June 2011 that he was taking steps to pirate all of AIR BAK’s assets and good will and that CHRISTY was intent on freezing out GLYNN and SAMPERE going forward. 42. The day after GLYNN refused to sign off on the RAMCO deal, on April l4, 2011, Defendant CHRISTY executed a purported termination of GLYNN as Manager of AIR BAK TECHNOLOGIES, LLC. This purported resolution was invalid and fraudulent as it recited a supermajority decision (as required under the Operating Agreement) despite the fact that CHRISTY and SAMPERE only collectively owned 66% of the LLC. Supermajority is defined as 67% or more. 43. Subsequently, and during the month of April, Defendant CHRISTY instructed RAMCO to
send approximately $260,000 to AIR BAK's factories in China. At that time, GLYNN and SAMPERE did not authorize CHRISTY to incur this indebtedness on behalf of the LLC. Based upon information and belief, CHRISTY converted to his own use, approximately $10,000 out of the total $260,000 that was unlawfully borrowed from RAMCO. Defendant CHRISTY also then executed a Master Loan and Security Agreement, as well as a Promissory Note, on behalf of the LLC without authority. 44. Plaintiff GLYNN has made repeated requests to see the Master Loan and Security Agreement, as well as the Promissory Note. To date, Defendant CHRISTY has refused, and continues to refuse to provide a copy of these documents. 45. On June 1, 2011, Coral Capital (the factoring agency) notified GLYNN and CHRISTY that AIR BAK was in default under the factoring agreement because RAMCO placed U.C.C. liens on all receivables of the LLC, in conjunction with the loan that CHRISTY unlawfully procured. 46. On June 2, 2011, Coral Capital served Plaintiff GLYNN with a formal notice of default and demanded that the U.C.C. liens be removed. As stated previously, GLYNN personally guaranteed the factoring line of credit through a Second Trust Deed on his personal home. 47. On June 3, 2011, Defendant CHRISTY served GLYNN with a purported termination of the Patent License Agreement. This termination was invalid as it was a unilateral attempt to terminate the License in direct contravention of the terms of the Patent License Agreement. 48. On this same day (June 3, 2011) Plaintiff GLYNN was denied access to the LLC bank accounts online banking system. (Prior to this date, GLYNN was the signer on the account and handled all the banking transactions.) GLYNN's email account was surreptitiously
turned off on CHRISTY’s instruction. GLYNN further learned that Defendant CHRISTY told numerous distributors and customers that GLYNN was no longer affiliated with AIR BAK TECHNOLOGIES, LLC. 49. Moreover, also on June 3, 2011, Defendant CHRISTY emailed the principal of Anchor Finance, LLC and stated, "Nasim, Thank you for your interest in AIR BAK. At this time AIR BAK technologies llc [sic] will be dissolved and patents have been removed. At the Request of New Partner and Legal Council-- Please discontinue all efforts on AIR BAK's behalf. Please do NOT circulate any AIR BAK information to Anyone without my written authorization." 50. On June 7, 2011 GLYNN and SAMPERE learned that CHRISTY told Heely's representatives that the Patents were no longer with AIR BAK and that GLYNN was no longer affiliated with the company. 51. Based upon these developments, as well as being notified by Plaintiff NIEVES of other misconduct by CHRISTY (set forth below) GLYNN and SAMPERE then realized together that they had been deceived by CHRISTY and recognized that CHRISTY was lacking integrity and that fair dealing with CHRISTY going forward was impossible absent formal court proceedings. 52. Based upon SAMPERE’s and GLYNN’s discovery of Defendant CHRISTY’s self-dealing and violation of his fiduciary duties to AIR BAK, GLYNN spearheaded a litigation in New York Supreme Court, which caused CHRISTY to file a Bankruptcy Petition and ultimately resulted in the issuance of a Preliminary Injunction against CHRISTY by Chief Bankruptcy Judge Celia Morris on January 25, 2012 . (See Procedural History In Court below). 53. Defendant CHRISTY's actions have caused significant harm to Plaintiff GLYNN and to AIR
BAK TECHNOLOGIES, including: • Since the email was turned off, GLYNN was unable to invoice BJ's Wholesale for
$150,000 that was going to be utilized towards the Coral Capital debt; • Defendant CHRISTY terminated the online store (store.AIR BAK.com) which
was generating approximately $4,000 per month in revenue; • Numerous orders have not been shipped due to the lack of email. This includes
approximately $54,000 to Dunham Sports, Markwort Distribution, and various internet orders; • Defendant CHRISTY has interfered in the banking operations which has
prevented payment of the office rent, telephone, and payroll; • There is no visibility with regards to products incoming from the China factories.
This is preventing the shipment of various orders including a $67,000 order schedule to ship for Heelys in Europe and $82,000 for Cache Group in Australia.
54. The activities of Defendants caused (i) Plaintiffs GLYNN and SAMPERE to be damaged in an amount to be proven at the time of trial, but in excess of $3,000,000, representing lost opportunities and lost profits; (ii) AIR BAK TECHNOLOGIES to be damaged in an amount to be proven at the time of trial, but in excess of $5,000,000, representing lost opportunities and lost profits; and (iii) threatens to irreparably damage Plaintiffs GLYNN and AIR BAK by otherwise converting the intellectual property and destroying the entire business operations and technology.
Defendant CHRISTY's Concurrent Misconduct In Relation to Intellectual Property Developed and Transferred to AIR BAK By Plaintiff NIEVES 55. Plaintiff NIEVES is a designer and marketer of backpack products and has been involved in the industry for 20 years with extensive domestic and overseas experience in backpack design and product development. 56. On or about December 15, 2009, Plaintiff NIEVES was first introduced to AIR BAK by Plaintiff SAMPERE because SAMPERE wanted NIEVES’ professional opinion regarding the AIR BAK backpack prototype/production which was then called a variety of names such as “Comfort Back” “Wellness Pack”, “Kids Fitness” under designs previously developed by Plaintiff GLYNN and Defendant CHRISTY. 57. On or about December 21, 2009, NIEVES, accompanied by his wife, met with SAMPERE and studied the then existent backpack prototype. 58. NIEVES, while being impressed because the interior airbladder design helped reduce the backpack weight load by 50%, informed SAMPERE that the idea was good but that the product required a lot of reworking, retooling, marketing and redesigning to make it better. NIEVES felt the backpacks SAMPERE was showing him were not up to today’s product design standards. 59. SAMPERE had determined to become a member of the LLC, arranged a further meeting between SAMPERE, NIEVES and Defendant, CHRISTY, in Mt. Kisco, New York to discuss CHRISTY’s marketing strategy and placement opportunities for the LLC’s backpack business. 60. CHRISTY informed SAMPERE and NIEVES at that meeting that CHRISTY was previously a building contractor whose business was affected by the world financial crisis,
that he had patented the original air bladder system for backpacks [US 20130075438 A1]. CHRISTY further stated to NIEVES that CHRISTY had limited success with his backpack (but that there was current interest in selling into major department stores), that CHRISTY had some inventory of the product in his garage but was not able to liquidate it since the designs were out dated. 61. At the meeting in Mt. Kisco, CHRISTY displayed to NIEVES the then operative designs for three (3) methods of inflating the patented air bladder system: Method 1, blowing through a mouthpiece tube apparatus; Method 2, placing the mouth on the bladder and blowing air directly into the bladder, similar to a beach ball; and Method 3, use of a tube with a blood pressure type pump apparatus. 62. After the demonstration NIEVES told CHRISTY and SAMPERE that the product was a viable idea but it needed to be completely redesigned if they want to turn the corner into a successful backpack business. NIEVES opined that, as the product currently stood, it would not work in the retail arena. 63. NIEVES presented several ideas at the meeting in Mt. Kisco including: a. blowing into the bladder using your mouth was not a sanitary enough for the consumer, especially with diseases like SARS; b. the blood pressure tube pump was not viable; c. blowing directly into the bladder made the product seem cheap d. it was too complicated to introduce 3 different methods for a single backpack idea; e. the product needed to be streamlined in order to work for the retail buyers and consumers;
f. The LLC needed to take the Apple approach to product launch and set out with one unique idea and one marketing message behind using the air cushion backpack; and g. the back panel of the backpack prototype was to simple and did not convey anything special from a marketing standpoint. 64. Defendant CHRISTY was both extremely interested in NIEVES’ opinions because CHRISTY did not have any experience in this product marketplace. 65. CHRISTY stated to SAMPERE that wanted NIEVES “on board” to help CHRISTY build the business and that the LLC needed someone of NIEVES’s level and skills. CHRISTY stated to SAMPERE that having NIEVES on board with NIEVES’ overseas connections the business could be brought to fruition. 66. Later, after NIEVES explained that he was busy with other clients, SAMPERE stated to NIEVES that the LLC needed to look into it and talk Plaintiff GLYNN to see if they could even afford to bring NIEVES on as a contractor, with the LLC’s limited budget. 67. Subsequently, NIEVES was convinced to work for AIR BAK on a mixed fee plus a percentage of ownership/membership in the LLC. 68. After the agreement between NIEVES and AIR BAK was consummated, throughout the period of January 2010 through June 2011, NIEVES fully redesigned the backpack including the system for inflation of the airbladder system. In conjunction with these redesigns, GLYNN wanted to bring in creative talent and stated that the LLC needed a true professional in the specific backpack industry. 69. At this time, GLYNN and SAMPERE recognized that CHRISTY was not qualify to fulfill the roll of creative design direction, engineering and production know how to the table.
Accordingly GLYNN and SAMPERE insisted on NIEVESS being hired to fulfill the role needed to bring the AIR BAK products to market. 70. Upon the contract being formed with the LLC, NIEVES performed the following general activities for the LLC: a. sample shopping at Paragon in New York City for new collection; b. sample shopping Westchester Mall for new collection; c. started new hangtag designs; d. meetings with CHRISTY to review ideas and direction for the new Air Bak/Avia line; e. meetings with CHRISTY to disclose 3 new style bag and adjustments of the air bladder to fit the new design; f. finalized the new AIR BAK logo and sent to CHRISTY; g. Sent new hangtag design to CHRISTY; h. Further development worked on AIR BAK/ Avia line; i. Sourcing producers for the air bladder component; j. Meetings with representative Steve Roemer to discuss design direction for the product line; k. Meeting with GLYNN and CHRISTY to discuss the particulars of ownership in AIR BAK; l. Coordinated with owner Ronald and Queeny of Manton Factory from China to meet and discuss the product new line, reviewed the NIEVES designs and introduced CHRISTY to Manton Factory owners; m. Developed all the production specs and renderings needed to produce the
collection, notified CHRISTY of sending exact bladder design; n. Sent CHRISTY actual renderings of the new inside bladder design, sent China detailed specs of the new back panel/shoulder blade protector, emboss quilted lumbar support, direct access to pinhole open and extra cushion shoulder straps that NIEVES designed, as follows:
o. Coordinated trip to Manton Bag & Accessories Co. LTD, in China for NIEVES and CHRISTY; p. Oversaw CHRISTY’s March 2011 trip to Manton factory in China to see and discuss newly designed back panel ready inspection; q. Worked with Kris Antsberger, Paralegal at American Sporting Goods Corp. regarding all design and legal for Avia and Ryka by AIR BAK; r. Traveled to Manton factory in China to meet with CHRISTY and factory personnel; s. Worked in China in March 2011 and supplied, cad spec and detailed backpack renderings including tie-dye print designs [CHRISTY currently uses in his FAKE AIR BAK CORP.] designing and review the mechanics to make the product work and injection for mold design for backpack exterior valve (designs as follows):
t. April 2011 work including supplying to CHRISTY hangtags, bladders and back panel samples of the backpack from my factory source for purposes of legal patent work; meetings with GLYNN and CHRISTY to review product line,
Modell’s Planogram display, featuring newly design Airbak line (as follows):
71. On or about May 6, 2011, CHRISTY informed NIEVES that the LLC wanted to switch factories after Manton had made all of NIEVES’s prototype and samples as requested by NIEVES. [In fact, CHRISTY did not have the LLC’s approval to switch factories and this was one of CHRISTY’s hidden steps taken to pirate AIR BAK which was not discovered until much later by SAMPERE and GLYNN. 72. In May 2011, further hidden self-dealing by CHRISTY was discovered by NIEVES. NIEVES found out that 2 months earlier, in March 2011, while visiting the Manton Factory, CHRISTY had stolen design patterns and product samples from the factory and had apparently pre-hired a factory employee, “Aris” in what was later discovered to be CHRISTY’s plot to bring all product manufacturing to new facilities in Northern China which were solely under CHRISTY’s control. 73. Currently the bags being placed in the market by DEFENDANT FAKE AIR BAK and being featured on CHRISTY’s FAKE AIR BAK websites, are all the products, inventions, designs, logos and newly restructured air bladder systems developed by NIEVES under the contract with AIR BAK for an equity share of the company. 74. All of NIEVES’ products, inventions, designs, logos and newly restructured air bladder
systems were to be fully and permanently titled to AIR BAK LLC as part of the contract between it and NIEVES. 75. However, CHRISTY filed a false and fraudulent Patent with the United States Patent and Trademark Office claiming the CHRISTY was the exclusive inventor of the new air bladder valve and fill designs and systems of the AIR BAK products, when NIEVES was the true inventor/designer, which Patent filings are found at Publication Number EP2441342 A1: https://www.google.com/patents/EP2441342A1?cl=en&dq=Philip+Troy+Christy&hl=en&sa =X&ei=VOteUoOgKtip4APP54H4BA&ved=0CE4Q6AEwAw
76. By June 2011, CHRISTY’s misconduct in relation to the formal Members of the LLC, GLYNN and SAMPERE, as well as the prospective Member of the LLC, NIEVES, made it clear that Defendants CHRISTY and CHRISTY’s FAKE AIR BAK company were simply going to pirate all assets of the LLC, including the pre-existing Patents, and were going to expropriate all developed and developing intellectual property, including the new physical air bladder inventions, brands, designs, trademarks, trade-dress, and intended patent modifications which Plaintiff NIEVES had singularly created and had intended to fully and permanently transfer ownership of in exchange for an equity/membership position in AIR BAK.
Procedural History in Other Courts 77. In August 2011, immediately after CHRISTY first attempted his pirating of the LLC, Plaintiff GLYNN brought a derivative lawsuit in the Supreme Court of the State of New York, Index No. 651693/2011. Despite initially receiving a TRO, GLYNN’s derivative action was stymied by CHRISTY filing a bankruptcy Petition on July 25, 2011 (Docket No. 11-31119 – Chap 13). 78. However, eventually, upon hearing of GLYNN’s motion for a preliminary injunction, Chief Bankruptcy Judge Celia Morris entered and ordered an injunction against CHRISTY on January 25, 2011. A true copy of the so-ordered injunction is attached here as Exhibit 6 and incorporated by reference. 79. Judge Morris’ Preliminary Injunction found as follows:  The LLC [AIR BAK] remains a corporate body for purposes of litigation pursuant to Delaware law, despite being listed as inactive by the Delaware Secretary of State. 8 Del. Code Ann. § 278. The LLC has demonstrated that it may suffer irreparable harm, including but not limited to, loss of goodwill and loss of customers if there is confusion over who has control of the patent pursuant to the Licensing Agreement, and which company is the real one. The LLC has raised sufficiently serious questions going to the merits that make fair grounds for litigation and a balance of hardships decidedly tips in the LLC’s favor. The irreparable harm is not of the type adequately ascertainable and able to be redressed by a remedy at law such as monetary damages. Plaintiff [CHRISTY] has the ability to put the LLC out of business well before trial on the merits can take place if the Court does not issue an injunction. The LLC has demonstrated irreparable harm based on the following acts by Plaintiff: (1) signing for the LLC; (2) creating corporate entities with substantially similar names to the name of the LLC; and
(3) using the LLC’s goodwill and customer base, making it unlikely that the LLC will recover any amount of damages sufficient to reinstate the supposedly defunct LLC. 80. Judge Morris’ Preliminary Injunction would have compelled CHRISTY as follows: ORDERED, that plaintiff and/or plaintiff’s business entities bearing substantially similar names to the LLC, including but not limited to, Airbak Technologies Corp. and Airbak Technologies LLC, and any others that may come to be known, are hereby prohibited and enjoined from, any and all contact including marketing or communicating with existing and prospective customers, suppliers and distributors of the LLC. ORDERED, that Plaintiff must provide, both to this Court and to the LLC, a list of his claimed patents and the names of any corporations which he has an interest in, ownership, membership, managerial, or otherwise, with in ten (10) days from the date of entry of this Order; and it is further ORDERED, that this Court will retain jurisdiction to enforce the terms of this order.
81. However, immediately after Judge Morris ordered the injunction, on January 20, 2012, CHRISTY moved to withdraw his bankruptcy filing which was so-ordered on February 15, 2012. 82. Plaintiffs originally contemplated reactivating the Supreme Court case, and did in fact appear in May 2013, in that Court to procure the Court’s declaration that there had been no dismissal of that action on the merits.
COUNT I Patent Infringement 83. Plaintiffs repeat and reallege each and every fact set forth in the preceding Paragraphs of the Complaint as though each were fully set forth here at length. 84. Defendants, PHILLIP TROY CHRISTY and AIR BAK TECHNOLOGIES, CORP. have
engaged in Patent Infringement violating 35 U.S.C.S. §§ 1 et seq. 85. AIR BAK is the licensee of U.S. Patent Number 7, 631,792, issued on December 15, 2009 (the 792 Patent). The day after said Patent was issued it was assigned irrevocably by CHRISTY to AIR BAK (Exhibit 2). 86. As irrevocable licensee, AIR BAK was granted all legal, rights and interests in the subject Patent and the ability to further convey and contract rights in relation thereto. 87. It is role as irrevocable licensee, AIR BAK contracted with Plaintiff NIEVES to fully redesign the backpack including the system for inflation of the airbladder system. 88. As set forth above, PHILLIP TROY CHRISTY and AIR BAK TECHNOLOGIES, CORP. frustrated that contract and expropriated NIEVES’ co-invented systems. 89. As set forth above, PHILLIP TROY CHRISTY and AIR BAK TECHNOLOGIES, CORP. are marketing back pack products currently which utilize and contain all of the products, coinvented systems, designs, logos and newly restructured air bladder systems developed by NIEVES under the contract with AIR BAK for an equity share of the company. 90. Defendant CHRISTY violated 35 U.S.C.S. § 256 when he knowingly and falsely filed Patent Application US20120085804 A1 on April 12, 2012 and Patent Application US 20130075438 A1 on November 20, 2012 because both Applications intentionally failed to identify Plaintiff NIEVES as the co-inventor of the redesigned air bladder apparatus and air filling system. 91. Defendant, AIR BAK TECHNOLOGIES, CORP., has contributed to the violation of 35 U.S.C.S. § 256 by failing to prepare and present CHRISTY’s filings so as to properly identify NIEVES as a co-inventor of the redesigned air bladder apparatus and air filling systems while it knowingly engages in making, using, selling, or offering to sell within the
United States, or importing into the United States, back pack products that embody the patented co-invention of NIEVES as described herein. 92. Upon information and belief, Defendants, CHRISTY and AIR BAK TECHNOLOGIES, CORP., have induced infringement of the licensed 792 Patent by other venders and commercial associates of Defendant AIR BAK CORPORATION and/or have committed acts of contributory infringement. 93. Neither AIR BAK nor NIEVES have expressly or impliedly consented to the infringing conduct of CHRISTY and/or Defendant AIR BAK CORPORATION in relation to the 792 Patent. 94. CHRISTY and/or Defendant AIR BAK CORPORATION will continue to infringe the 792 Patent and to violate 35 U.S.C.S. § 256 unless enjoined by this Court. As a result of the Defendants’ infringing conduct, Plaintiff’s NIEVE and AIR BAK have suffered, and will continue to suffer, irreparable harm for which there is no adequate remedy at law. NIEVE and AIR BAK are entitled to preliminary and permanent injunctive relief against such infringement, under 35 U.S.C. § 283. 95. As a result of the infringement of the 792 Patent, AIR BAK and NIEVES have been damaged, will be further damaged, and is entitled to be compensated for such damages, pursuant to 35 U.S.C. § 284, in an amount to be determined at trial.
COUNT II Common Law Trademark Infringement 96. Plaintiffs repeat and reallege each and every fact set forth in the preceding Paragraphs of the
Complaint as though each were fully set forth here at length. 97. Defendants, PHILLIP TROY CHRISTY and AIR BAK TECHNOLOGIES, CORP. have engaged in Trademark Infringement violating 15 U.S.C.S. §§ 1051 et seq. 98. As set forth above, NIEVES redesigned a series of AIR BAK trademark logos and established a redesigned trade dress for the AIR BAK back pack in addition to its mechanical air bladder filling systems which were co-invented mechanical inventions. These trademark logos and trade dress were designed for AIR BAK under contract with NIEVES and ownership of the logos was assigned from NIEVES to AIR BAK. 99. PHILLIP TROY CHRISTY and AIR BAK TECHNOLOGIES, CORP. are marketing back pack products currently which utilize and contain all of the trademark logos and trade dress were designed for AIR BAK under contract with NIEVES by NIEVES. 100. The trade dress of the AIR BAK line of products acquired distinctiveness by virtue of
NIEVES’ new designed and retooling and through secondary meaning such that consumers are likely to associate the source of such products with AIR BAK. 101.
Due to AIR BAK’s exclusive and widespread use of the AIR BAK trademark logos and
trade dress in connection with the back packs, AIR BAK’s trade dress in such product line has acquired substantial value and recognition in the United States. Such trade dress is well known to the consuming public and the trade as identifying and distinguishing Plaintiff as the exclusive and unique source of the products that are used in connection with such trade dress. 102. PHILLIP TROY CHRISTY and AIR BAK TECHNOLOGIES, CORP. manufactured,
sold and is continuing to sell back packs using designs that are identical to or substantially similar to or otherwise the same as the NIEVES’ trademark, trade dress, patterns and logo created under contract for the benefit of AIR BAK.
PHILLIP TROY CHRISTY and AIR BAK TECHNOLOGIES, CORP. is using the non-
functional features of the trade dress of Plaintiffs’ AIR BAK product line such that there is
likelihood of confusion between the trade dress of the CHRISTY ARIR BAK CORP. back packs and the trade dress of AIR BAK/NIEVE back pack product line. In fact, it is CHRISTY’s intention that consumer confusion be created between the two product lines.
Since June 2011 Plaintiffs have set forth in sufficient detail in writing to the Defendants the
nature of the infringements with demands, inter alia, that Defendants immediately cease and desist from selling the AIR BAK back packs. However, Defendants have manifested a clear refusal to stop such wrongful activity, have defended the attempts in two courts to obtain injunctions through gaming the court systems, and, continue to willfully, with bad faith intent to profit, and without the consent of Plaintiffs, traffick in and use, in this judicial district and elsewhere, AIR BAK’s trademarks, logos, trade dress, and product designs as redesigned by NIEVES in 2010 through 2011, in the FAKE AIR BAK CORP. back packs in violation of U.S. Copyright and Trademark laws.
As a direct result, Plaintiff AIR BAK has lost sales in its back pack line, and all other
Plaintiffs have been damaged. 106. By reason of the foregoing, the Defendants have engaged, and is continuing to engage, in
acts of trademark infringement in violation of the common law. 107. Such conduct on the part of the defendant has caused and will continue to cause
irreparable injury to Plaintiff, for which Plaintiff has no adequate remedy at law. 108. Such conduct on the part of defendant has caused and will continue to cause damages to
Plaintiffs in an amount to be determined at trial.
COUNT III False Designation Of Origin And Unfair Competition (15 U.S.C. § 1125(A)) 109. Plaintiffs repeat and reallege each and every fact set forth in the preceding Paragraphs of
the Complaint as though each were fully set forth here at length. 110.
The Defendant' use of Plaintiffs’ trade dress constitutes the use of false or misleading
designations of origin and/or false representations of fact in violation of 15 U.S.C. § 1125(a), in that such conduct is likely to cause consumers to be confused, mistaken or deceived into believing that the offending products originate with, or are sponsored by Plaintiff, AIR BAK, and/or that CHRISTY and the FAKE AIR BAK CORP. are authorized licensees, distributors or retailers of the AIR BAK product line.
Such conduct on the part of the Defendants has caused and will continue to cause
irreparable injury to Plaintiffs, for which Plaintiffs have no adequate remedy at law. 112. Such conduct on the part of Defendants has caused and will continue to cause damages to
COUNT IV Common Law Unfair Competition 113. Plaintiffs repeat and reallege each and every fact set forth in the preceding Paragraphs of
the Complaint as though each were fully set forth here at length. 114. By reason of the foregoing, the Defendants have engaged, and are continuing to engage,
in acts of unfair competition in violation of the common law. 115. Such conduct on the part of defendant has caused and will continue to cause irreparable
injury to Plaintiffs, for which Plaintiffs have no adequate remedy at law. 116. Such conduct on the part of Defendants has caused and will continue to cause damages to
COUNT V N.Y. General Business Law § 360-1 117. Plaintiffs repeat and reallege each and every fact set forth in the preceding Paragraphs of
the Complaint as though each were fully set forth here at length. 118.
Defendant' activities have created and continue to create a likelihood of injury to the public
image and reputation of Plaintiff, AIR BAK, and to dilute the distinctive quality of its trade dress and all rights held there under, in violation of the General Business Law of the State of New York.
By reason of the foregoing, the Defendants have violated and are continuing to violate
Section 360-1 of the New York General Business Law.
Such conduct on the part of the Defendants has caused and will continue to cause irreparable
injury to Plaintiff, AIR BAK, for which Plaintiff has no adequate remedy at law.
Such conduct on the part of Defendants has caused and will continue to cause damages to
Plaintiffs in an amount to be determined.
COUNT VI N.Y. General Business Law § 349
Plaintiffs repeat and reallege each and every fact set forth in the preceding Paragraphs of
the Complaint as though each were fully set forth here at length.
The Defendants’ activities constitute deceptive acts and practices in the conduct of their
businesses, in violation of Section 349 of the General Business Law of the State of New York. 124. Such conduct on the part of the Defendants has caused and will continue to cause
irreparable injury to Plaintiffs, for which Plaintiffs have no adequate remedy at law. 125. Such conduct on the part of defendant has caused and will continue to cause damages to
COUNT VII Copyright Infringement 126. Plaintiffs repeat and reallege each and every fact set forth in the preceding Paragraphs of
the Complaint as though each were fully set forth here at length. 127. Plaintiff NIEVE filed his Copyright Application Number VAu001051494 for written
works created as of December 13, 2010 with the US Copyright office on December 13, 2010. A true and correct copy of that filing is attached here as Exhibit 7. 128. 129. The copyrighted works 17 U.S.C. § 101 et seq. The unauthorized copying and use of NIEVES’ copyrighted works in conjunction with
the promotion, sale and distribution by PHILLIP TROY CHRISTY and AIR BAK TECHNOLOGIES, CORP. of the Defendants’ counterfeit AIR BAK back packs infringes upon NIEVES’ exclusive rights to reproduce those works under Section 106 of the Copyright Act. 130. PHILLIP TROY CHRISTY and AIR BAK TECHNOLOGIES, CORP. have the right
and ability to supervise, and have a direct financial interest in, the aforesaid infringing
activities. 131. Defendants PHILLIP TROY CHRISTY and AIR BAK TECHNOLOGIES, CORP. have
knowingly induced, caused, participated in, materially contributed to and derived economic benefit from the infringement of Plaintiff’s copyrights, and plaintiffs have been damaged and continue to be damaged thereby. 132. Defendants’ aforesaid conduct has been and continues to be intentional, willful, and with
full knowledge of Plaintiffs’ copyrights and the infringement thereof. 133. Defendants’ conduct, as set forth herein, is causing and, unless enjoined and restrained by
this Court, will continue to cause NIEVE irreparable harm. 134. Defendants’ use of the Plaintiff’s work(s) constitutes infringement pursuant to 17 U.S.C.
§ 501. 135. Such conduct on the part of Defendants has caused and will continue to cause irreparable
injury to NIEVE, for which Plaintiff NIEVE has no adequate remedy at law. 136. Such conduct on the part of Defendants has caused and will continue to cause damages to
Plaintiff NIEVE in an amount to be determined at trial.
COUNT VIII Common Law Copyright Infringement 137. Plaintiffs repeat and reallege each and every fact set forth in the preceding Paragraphs of
the Complaint as though each were fully set forth here at length. 138.
By reason of the foregoing, the Defendants have engaged, and are continuing to engage, in
acts of copyright infringement in violation of the common law.
Defendants’ aforesaid conduct has been and continues to be intentional, willful, and with
full knowledge of Plaintiff’s copyrights and the infringement thereof. 140. Defendants’ conduct, as set forth herein, is causing and, unless enjoined and restrained by
this Court, will continue to cause NIEVE irreparable harm. 141. Such conduct on the part of Defendants has caused and will continue to cause irreparable
injury to NIEVE, for which Plaintiff NIEVE has no adequate remedy at law. 142. Such conduct on the part of Defendants has caused and will continue to cause damages to
COUNT IX Fraudulent Conveyance By Defendants 143. Plaintiffs repeat and reallege each and every fact set forth in the preceding Paragraphs of
the Complaint as though each were fully set forth here at length. 144. Defendants CHRISTY and AIR BAK TECHNOLOGIES CORP. engaged in a series of
transactions and conveyances where they hypothecated copyrights, trademarks, trade dress, patent rights, intellectual property, assets and receivables of the Plaintiffs which had not been purchased by them for adequate consideration where every such conveyance and transfer was made and every obligation incurred with actual intent, as distinguished from intent presumed in law, to hinder, delay, or defraud either present or future creditors of CHRISTYand AIR BAK. 145. Pursuant to N.Y. Debtor and Creditor Law § 276 the aforesaid conveyances were
fraudulent as to both present and future creditors.
Pursuant to N.Y. Debtor and Creditor Law § 277 the aforesaid conveyances were
fraudulent as to AIR BAK, SAMPERE, GLYNN and AIR BAK’s present and future creditors. 147. Defendants’ conduct, as set forth herein, is causing and, unless enjoined and restrained by
this Court, will continue to cause Plaintiffs irreparable harm. 148. Such conduct on the part of Defendants has caused and will continue to cause irreparable
injury to Plaintiffs, for which Plaintiffs have no adequate remedy at law. 149. Such conduct on the part of Defendants has caused and will continue to cause damages to
COUNT X Breach of Fiduciary Duty 150. Plaintiffs repeat and reallege each and every fact set forth in the preceding Paragraphs of
the Complaint as though each were fully set forth here at length. 151. Pursuant to the Operating Agreement, the Patent License Agreement, statutes prescribing
conduct in a Limited Liability Company and existing common law, Defendant CHRISTY had a duty to act in good faith and not to commit acts of fraud, bad faith or willful tortious misconduct, and CHRISTY at all times, and to the present times, owed a fiduciary duty to GLYNN, SAMPERE and AIR BAK. The Operating Agreement further provides that the "Managers shall discharge their managerial duties in good faith... and in a manner reasonably believed to be in the best interests of the Company." Exhibit 1, ¶ 11.2(a). 152. CHRISTY's actions, among other things, in refusing to execute transactions that were
favorable to the Company, unlawfully attempting to remove GLYNN as Manager; attempting to transfer the entire assets of the LLC including the primary Patents; closing the bank accounts; shutting down the email accounts; borrowing money without authority; converting $10,000 to his own use; defaming GLYNN to distributors and customers; unlawfully attempting to terminate the Patent License Agreement; and other conduct as more particularly described herein, was a breach of fiduciary duty by CHRISTY. 153. CHRISTY as a Member and Manager of the LLC had no right to self-deal with the
RAMCO transaction and obtain for himself equity in exchange for property that belonged to the LLC and GLYNN. 154. CHRISTY as a Member and Manager of the LLC was and is a fiduciary for GLYNN and
the LLC and is not entitled to obtain profits or loans from the business of the LLC without the consent of GLYNN and is otherwise not entitled to dispose of the Patent, execute any licenses, or otherwise transfer any rights to the Patents. 155. Defendant CHRISTY's refusal to disclose the terms of the Master Loan and Security
Agreement with RAMCO, relating to the loan transaction, constitutes a breach of CHRISTY's duty of loyalty and disclosure to Plaintiffs. 156. Defendant CHRISTY's assignment of the LLC's interest in the Patent without
disclosure, consent, or accounting to Plaintiffs constitutes a breach of CHRISTY's fiduciary duty to not self-deal with the business, property and opportunities of the LLC. 157. As a direct and proximate result of Defendant Phillip CHRISTY's breach of his fiduciary
duties to the Plaintiffs, the Plaintiffs have been damaged in an amount to be proven at the time of trial, but in excess of $1,000,000, with pre-judgment interest, as well as
reimbursement of the Plaintiffs' legal fees. 158. Plaintiffs are also entitled to a full accounting of the gains made by CHRISTY and any
loans executed by him from his breach of fiduciary duty and the imposition of a constructive trust on all proceeds obtained by CHRISTY from his self-dealings with the LLC, the Patents, and RAMCO. 159. By reason of their secrecy and breach of fiduciary duty, the Defendants are threatening
the Plaintiffs with transferring the Patents subject to constructive trust, which transfer, if taking place, would destroy the business operations and constructive trust and otherwise irreparably injure the Plaintiffs. Accordingly, Plaintiffs are entitled to temporary, preliminary, and permanent injunctive relief, prohibiting CHRISTY from transferring the Patents.
COUNT XI Misappropriation of AIR BAK's Business Opportunity 160. Plaintiffs repeat and reallege each and every fact set forth in the preceding Paragraphs of
the Complaint as though each were fully set forth here at length. 161. A member or manager of a limited liability company may not take for himself a business
opportunity presented to the company or an opportunity which is available for the Company's sole asset, among other opportunities. The member or manager has a duty to take advantage of any such opportunity, if at all, for the benefit of the company. 162. Defendants’ misappropriation of the Patents of the LLC, and the negotiations with
RAMCO after unlawfully attempting to terminate GLYNN and otherwise shut down the
business operations of AIR BAK, and his failure to communicate to Plaintiffs the terms of any proposed transaction, constitutes an actionable misappropriation of a business opportunity of the LLC. 163. A member and manager of a limited liability company has a duty not to take for himself
the profits of operating, selling, or liquidating the business of the company. Any such profits belong to the company and all of its members. 164. As a direct and proximate result of Defendant Phillip CHRISTY's unlawful
misappropriation of the business opportunity belonging to the LLC, the Plaintiffs have been damaged in an amount to be proven at the time of trial, but in excess of $1,000,000, with pre-judgment interest, as well as reimbursement of the Plaintiffs' legal fees. 165. Plaintiffs are also entitled to a full accounting of the gains made by CHRISTY and any
loans executed by him from his misappropriation and the imposition of a constructive trust on all proceeds obtained by CHRISTY from his self-dealings with the LLC, the Patents, and RAMCO. 166. By reason of their secrecy, the Defendants are threatening the Plaintiffs with transferring
the Patents subject to constructive trust, which transfer, if taking place, would destroy the business operations and constructive trust and otherwise irreparably injure the Plaintiffs. Accordingly, Plaintiffs are entitled to temporary, preliminary, and permanent injunctive relief, prohibiting CHRISTY from transferring the Patents.
COUNT XII Breach of Contract and Implied Covenant of Good Faith and Fair Dealing
the Complaint as though each were fully set forth here at length. 168. A limited liability company and its members must comply with the implied covenant,
existing in every contract, of good faith and fair dealing with relation to the other parties to the contract, including Plaintiffs GLYNN, SAMPERE and NIEVES. 169. On information and belief, Defendant Phillip CHRISTY's acts and omissions, as alleged
above, were perpetrated in bad faith and wanton dishonesty, in a surreptitious and secretive manner, with the intent to wrest and appropriate from Plaintiffs, GLYNN and SAMPERE, their percentage of ownership, rights and benefits to the Patents and profits of the LLC. 170. On information and belief, Defendant Phillip CHRISTY's acts and omissions, as alleged
above, were perpetrated in bad faith and wanton dishonesty, in a surreptitious and secretive manner, with the intent to wrest and appropriate from Plaintiff NIEVES his original product and patent designs and intellectual property for the benefit of the newly formed and illegitimate Delaware corporation, CHRISTY’S AIR BAK COMPANY, the identity of which was intentionally designed by CHRISTY to mirror the identity of AIR BAK so as to deceive the business associates and partners of the LLC. 171. Moreover, Defendant CHRISTY's actions, as alleged above, constituted independent
and separate breaches of the Limited Liability Company Agreement and the Patent License Agreement. 172. CHRISTY's actions and omissions, as alleged above, constitute a breach of his
contractual duty to act in good faith and deal fairly with the Plaintiffs, GLYNN and SAMPERE, his co-members of the LLC, with the LLC itself in its contractual dealings with
Plaintiff NIEVESS, as a rogue member of the LLC who stole and misappropriated the intellectual property of Plaintiff NIEVES which was intended to be delivered to the LLC in exchange for equity interest in the LLC. 173. As a direct and proximate result of Defendant Phillip CHRISTY's breach, each of the
Plaintiffs have been damaged in an amount to be proven at the time of trial, but in excess of $3,000,000, with pre-judgment interest. 174. Further, pursuant to the terms of the controlling LLC contracts, Plaintiffs GLYNN and
SAMPERE are entitled to reimbursement of their legal fees. 175. Plaintiffs, GLYNN and SAMPERE, are also entitled to a full accounting of the economic
activity, banking, monetary activity undertaken by CHRISTY under the guise of the LLC or its mirrored identity, AIR BAK TECHNOLOGIES CORP. and Defendants CHRISTY and CHRISTY’S AIR BAK COMPANY must, in furtherance of said accounting to the Members of the LLC, provide expedited disclosure of all loans, leases, contracts, and related business conduct undertaken in furtherance of the design, production and sale of the backpack products as well as any incomes resulting therefrom. 176. Further, Plaintiffs request that a constructive trust be imposed upon any loans executed
by CHRISTY and/or the Defendant CHRISTY’S AIR BAK COMPANY as well as upon all proceeds obtained by CHRISTY and/or the Defendant CHRISTY’S AIR BAK COMPANY derived from CHRISTY’s self-dealings with the LLC, the Patents, and RAMCO.
COUNT XIII Constructive Trust
the Complaint as though each were fully set forth here at length. 178. CHRISTY at all relevant times was aware of the Plaintiffs respective interests in the
LLC, the Patents, and the revenues, relationships, and contracts with customers, distributors, and investors. 179. Without justification, CHRISTY caused the LLC to enter into a transaction involving the
sale of Plaintiffs' interests of the LLC and property. Moreover, CHRISTY without justification, interfered in the business operations of the LLC and the relationship, revenues, and contracts with various customers, distributors, and investors, as alleged above. 180. As a direct and proximate result of Defendant CHRISTY's conduct and interference, the
Plaintiffs have been damaged in an amount to be proven at the time of trial, but in excess of $1,000,000, with pre-judgment interest, as well as reimbursement of the Plaintiffs' legal fees. 181. Plaintiffs are also entitled to a full accounting of the gains made by CHRISTY and any
loans executed by him from his interference and the imposition of a constructive trust on all proceeds obtained by CHRISTY from his self-dealings with the LLC, the Patents, and RAMCO.
COUNT XIV Conversion 182. Plaintiffs repeat and reallege each and every fact set forth in the preceding Paragraphs of
the Complaint as though each were fully set forth here at length. 183. CHRISTY's acts and omissions, as alleged above, were intended to and, in fact, did
appropriate to himself, without justification, the ownership, rights, benefits and interest in and to the LLC that Plaintiffs had in their membership interests, including a direct or indirect interest or rights in the LLC's valuable Patents. 184. Such defendants' acts and omissions were committed with wanton dishonesty and
constitute conversion of Plaintiffs' interests in the LLC. 185. As a direct and proximate result of Defendant Phillip CHRISTY's conduct, the Plaintiffs
have been damaged in an amount to be proven at the time of trial, but in excess of $1,000,000, with pre-judgment interest, as well as reimbursement of the Plaintiffs' legal fees.
COUNT XV Unjust Enrichment 186. Plaintiffs repeat and reallege each and every fact set forth in the preceding Paragraphs of
the Complaint as though each were fully set forth here at length. 187. CHRISTY's acts resulted in his unjustified, unlawful receipt of money or property with
an unknown value in excess of his 33% interest in the LLC, with a resulting unlawful decrease in the LLC interest of Plaintiffs GLYNN and SAMPERE. 188. By reason of the unlawful activities of CHRISTY, he was unjustly enriched in an amount
to be proven at the time of trial, but in excess of this court's jurisdictional limits. 189. Plaintiffs are entitled to recover the amounts by which CHRISTY was unlawfully and
unjustly enriched by virtue of his wrongful conduct.
COUNT XVI Rescission And Declaratory Judgment 190. Plaintiffs repeat and reallege each and every fact set forth in the preceding Paragraphs of
the Complaint as though each were fully set forth here at length. 191. The activities of CHRISTY, as alleged above, entitle Plaintiffs to a rescission of each of
their agreements with RAMCO and the LLC relating to the sale of the Plaintiffs' LLC interests to RAMCO. 192. Also, the activities of CHRISTY, as alleged above, entitle each of the Plaintiffs to a
declaratory judgment under CPLR 3017(b) and CPLR 3004 that: 193. (a) the Plaintiffs at all times, from inception on December 16, 2009 to the date of the
final judgment herein, have retained their respective 33% interests in the LLC; b) the transactions and agreement of sale of the Plaintiffs' LLC interests to
RAMCO are null and void, including: (i) (ii) 194. the Master Loan and Security Agreement, as well as Promissory Note; any purported sale or transfer of the Patents to RAMCO.
Appropriate adjustments shall be made pursuant to CPLR 3004 for the moneys and other
property received by RAMCO and payments received by CHRISTY taking into account the respective LLC interests of GLYNN (33%). 195. Further or consequential relief is claimed by the Plaintiffs consisting of an accounting,
imposition of a constructive trust, application of the doctrine prohibiting commingling of trust assets with CHRISTY's personal assets and impressing a trust upon all commingled funds and other assets; and a declaration that, by reason of CHRISTY's breach of fiduciary
duty, CHRISTY has forfeited all of his membership interest in the LLC.
COUNT XVII Equitable Accounting
the Complaint as though each were fully set forth here at length. 197. The activities of Defendant CHRISTY as alleged above entitle the Plaintiffs to an
equitable accounting by CHRISTY and LLC for all of the moneys and other property received by CHRISTY or any entities controlled by him and/or the LLC with respect to the transaction with RAMCO. 198. There exists a fiduciary or trust; relationship respecting the Defendants' dealings with the
Patents and Property. Plaintiffs entrusted to the Defendants their interest in the LLC and the Patents, as to which each of the Defendants is bound to reveal its dealings.
COUNT XVIII Derivative Action Asserting LLC's Claims Against CHRISTY
the Complaint as though each were fully set forth here at length. 200. CHRISTY, as Member and Manager of the LLC, had a fiduciary duty to the LLC.
CHRISTY breached this duty. These activities deprived the LLC of its right to receive benefits from the sale and the benefits of the Patent, the trademark, trade dress and copyrights addressed herein.
CHRISTY is liable under the doctrine of waste to AIR BAK. Demand that AIR BAK commence the litigation against CHRISTY was made and action
taken on the demand in the absence of CHRISTY in that CHRISTY has voluntarily left AIR BAK and has otherwise been removed as an officer/member for willful misconduct after a vote constituting a supermajority of membership interests in the AIR BAK LLC. 203. CHRISTY is liable to the LLC for repayment of such amount to the LLC, with interest
and attorneys' fees. 204. Defendant CHRISTY’s conduct, as set forth herein, is causing and, unless enjoined and
restrained by this Court, will continue to cause AIR BAK irreparable harm. 205. Such conduct on the part of Defendant CHRISTY has caused and will continue to cause
irreparable injury to AIR BAK, for which AIR BAK has no adequate remedy at law. 206. Such conduct on the part of Defendant CHRISTY has caused and will continue to cause
damages to AIR BAK in an amount to be determined at trial.
WHEREFORE, the Plaintiffs demand judgment, on COUNTS I through COUNT XVIII of the Complaint against Defendants CHRISTY and AIR BAK Technologies, LLC as follows: 1. On COUNT I, upon final hearing or trial: a. A judgment that the Defendants have infringed the 792 Patent;
b. A judgment and order permanently restraining and enjoining the Defendants, their directors, officers, employees, servants, agents, affiliates, subsidiaries, others controlled by them, and all persons in active concert or participation with any of them, from further infringing on the792 Patents;
c. A judgment and order requiring the Defendants to pay damages to Plaintiffs adequate to compensate them for the Defendants’ wrongful infringing acts, in accordance with 35 U.S.C. § 284; d. A judgment and order requiring the Defendants to pay increased damages up to three times, in view of their willful and deliberate infringement of the 792 Patents; e. A finding in favor of Plaintiffs that this is an exceptional case, under 35 U.S.C. § 285, and an award to Plaintiffs of their costs, including reasonable attorney fees and other expenses incurred in connection with this action; f. A judgment and order requiring the Defendants to pay to Plaintiffs pre-judgment interest under 35 U.S.C. § 284, and post-judgment interest under 28 U.S.C. § 1961, on all damages awarded; and 2. On COUNT II - VI, as follows:
a. A determination that Defendants willfully and deliberately violated 15 U.S.C. § 1114, that AIR BAK has been damaged by such violation, and that the Defendants are liable to AIR BAK for such violation; b. A determination that Defendants violated 15 U.S.C. §§ 1125(a), (c), and (d)(1)(A)(B), that AIR BAK has been damaged by such violations, and that Defendants are liable to AIR BAK for such violations; c. A determination that the Defendants committed common law trademark infringement, that AIR BAK has been damaged by such infringement, and that Defendants are liable to AIR BAK for common law trademark infringement; d. A determination that this case is “exceptional” in the sense of 15 U.S.C. § 1117(a); e. Under all claims for relief, that an injunction be temporarily, preliminarily, and permanently issued enjoining Defendants and their officers, employees, agents,
successors and assigns, and all those in active concert and participation with them, and each of them who receives notice directly or otherwise of such injunctions, from: i. imitating, copying, or making any unauthorized use of the AIR BAK Marks, or marks likely to cause confusion with them, including but not limited to the Infringing Marks, the Infringing Domain Names, and the AIR BAK Marks; ii. importing, manufacturing, producing, distributing, circulating, selling, offering for sale, advertising, promoting or displaying any service or product using any simulation, reproduction, counterfeit, copy, or colorable imitation of the AIR BAK Marks; iii. using any simulation, reproduction, counterfeit, copy or colorable imitation of the AIR BAK Marks in connection with the promotion, advertisement, display, sale, offer for sale, manufacture, production, circulation or distribution of any product or service, including but not limited to the Infringing Marks and the Infringing Domain Names; iv. using any false designation of origin or false description (including, without limitation, any letters, symbols, or designs constituting the AIR BAK Marks) or performing any act, which can, or is likely to, lead members of the trade or public to believe that any service or product manufactured, distributed or sold by Defendants is in any manner associated or connected with AIR BAK or the AIR BAK Marks, or is sold, manufactured, licensed, sponsored, approved or authorized by AIR BAK; v. filing an application with the USPTO or any state or local government to register any of the Infringing Marks, or any other mark likely to cause confusion with the AIR BAK Marks;
vi. all of the above with the exception of nominative fair use of the AIR BAK Marks. f. An Order directing that Defendants deliver for destruction all products, promotional and advertising materials, labels, tags, signs, prints, packages, videos or other materials in their possession or under their control, bearing or using unauthorized versions of the AIR BAK Marks or any simulation, reproduction, counterfeit, copy or colorable imitation thereof (including but not limited to the Infringing Marks and the Infringing Domain Names), and all plates, molds, matrices and other means of making the same, pursuant to 15 U.S.C. § 1118; g. An Order directing the transfer of the Infringing Domain Names to AIR BAK or its designee; h. An Order directing such other relief as the Court may deem appropriate to prevent the trade and public from deriving the erroneous impression that any service or product manufactured, sold or otherwise circulated or promoted by Defendants is authorized by AIR BAK or related in any way to AIR BAK’s products and services; i. An Order directing the Defendants and their agents, employees, servants, attorneys, successors, and assigns, and all others in privity or acting in concert therewith, to file with this Court, and serve upon AIR BAK’s counsel within thirty (30) days after entry of such judgment, a written report under oath, setting forth in detail the manner and form in which they have complied with such judgment; j. An Order permitting AIR BAK, and/or auditors of AIR BAK, to audit and inspect the books, records, and premises of the Defendants and related entities for a period of six (6) months after entry of final relief in this matter, to determine the scope of the Defendants’ past use of AIR BAK’s intellectual property, including all
manufacturing, distribution, and sales of products and services bearing AIR BAK’s trademarks, as well as the Defendants’ compliance with the orders of this Court; k. An award of AIR BAK’s costs and disbursements incurred in this action, including AIR BAK’s reasonable attorney’s fees; l. An award of AIR BAK’s damages trebled or, alternatively, an award of Defendants’ wrongful profits trebled, whichever is greater, plus AIR BAK’s costs and attorney’s fees, pursuant to 15 U.S.C. § 1117; m. An award to AIR BAK of its costs incurred in this action, including an award of reasonable attorney fees under 17 U.S.C. § 1114; n. As award to AIR BAK of statutory damages under 15 U.S.C. § 1125(d);
o. An award of AIR BAK’s damages arising out of Defendants’ acts; p. An Order requiring Defendants to file with the Court and provide to AIR BAK an accounting of all sales and profits realized by Defendants through the use of the AIR BAK Marks and any confusingly similar marks or counterfeits, copies, reproductions or colorable imitations thereof (including but not limited to the Infringing Marks and the Infringing Domain Names); q. An award of interest, including pre-judgment interest on the foregoing sums; and
On COUNT VII – COUNT VIII, as follows: a. declaring that Defendants’ unauthorized copying of Plaintiff’s copyrighted works onto defendants’ computer file servers willfully infringes Plaintiff’s copyrights in violation of the Copyright Act;
b. ordering defendants to deliver up for destruction all infringing materials, including all discs, drives or other storage media, that contain infringing copies of plaintiffs’ copyrighted works; c. awarding plaintiffs, at their election, either (i) actual damages and profits derived by defendant as a result of their infringing activities, pursuant to 17 U.S.C. § 504(b), or (ii) statutory damages in the maximum amount of $150,000 with respect to each of plaintiffs’ copyrighted works, pursuant to 17 U.S.C. § 504(c); d. enjoining defendants and their respective agents, employees, officers and directors, attorneys, successors, licensees, and assigns, and all those persons acting in concert and combination therewith, from further infringement of plaintiffs'; 4. On COUNT IX – COUNT XVI, in an amount to be proven at the time of trial, but in
excess of $5,000,000, with pre-judgment interest, as well as reimbursement of the Plaintiffs' legal fees. Plaintiffs are also entitled to a full accounting of the gains made by CHRISTY and AIR BAK TECHNOLOGIES CORP. and any loans executed by him from his breach and the imposition of a constructive trust on all proceeds obtained by CHRISTY from his self-dealings with the LLC, the Patents, and RAMCO. 5. On COUNTS IX and XVI , rescission of each of the agreements with RAMCO and the
LLC relating to the sale of the Plaintiffs' LLC interests to RAMCO. Also, the activities of CHRISTY, as alleged above., entitle each of the Plaintiffs to a declaratory judgment under CPLR 3017(b) and CPLR 3004 that: a. the Plaintiffs at all times, from inception on December 16, 2009 to the date of the final judgment herein, have retained their respective 33% interests in the LLC;
b. the transactions and agreement of sale of the Plaintiffs' LLC interests to RAMCO are null and void, including: i. the Master Loan and Security Agreement, as well as Promissory Note; ii. any purported sale or transfer of the Patents to RAMCO. 6. 7. 8. 9. 10. 11. 12. On the COUNT XVII, an equitable accounting. Attorneys' fees; Pre-judgment and post-judgment interest; Punitive damages; Costs; Temporary, Preliminary, and Permanent Injunctive Relief; and Such other further relief which the Court deems just and equitable.
JURY DEMAND Plaintiffs demand a trial by jury on all issues presented in this complaint. Dated: March 17, 2014
_____________________________ PAUL W. VERNER VERNER SIMON Attorneys for Plaintiffs 30 Wall Street, 8th Floor New York, New York 10005 Tel: (212) 502-5500 Fax: (212) 502-5400 pwverner@vernerlaw.com