$10,000,000 SUIT FILED AGAINST SAFEGUARD BUSINESS SYSTEMS INC.
$10,000,000 SUIT FILED AGAINST SAFEGUARD BUSINESS SYSTEMS INC. LOS ANGELES, Oct. 16 /PRNewswire/ -- The following is being issued by Natsuti & Hinkle: On Oct. 1, 1992 a $10-million cross complaint was filed against Safeguard Business Systems Inc., a Delaware corporation (headquartered in Fort Washington, Pa.) and manufacturer of One-Write business forms in Superior Court of the State of California for the County of Los Angeles. Bruce C. Fishelman, attorney for Jay Keating and Associates, a former self-employed Safeguard distributor/franchisee in West Hills, Calif., said the 18-point cross complaint followed a Temporary Restraining Order (TRO) that Safeguard obtained in August against his client. Also named in the suit are Elvis Mason, chief executive officer of Safeguard; San Jacinto Holdings Inc. of Texas, the parent holding company of Safeguard; various present and past owners or employees of both; and 100 Doe individuals and entities. The 18-point suit seeks damages against Safeguard and the other defendants for intentional and negligent misrepresentation, breach of good faith and fair dealing, libel, slander, restraint of competition, unfair business practices, breach of fiduciary obligation, conflict of interest and intentional and negligent infliction of emotional distress. In addition, the cross complaint alleges that Safeguard failed to register its franchise offers with the Commissioner of Corporations of the State of California, and that Safeguard contracts and practices violate various other California laws. Among other requests for relief, the suit seeks the appointment of a Receiver for Safeguard to stop violations of the California Unfair Business Practices Act and to obtain disgorgement of monies from Safeguard. The law suit contends that, despite representations by and contractual agreements with Safeguard that supposedly ensured his participation in all Safeguard Sales Programs within his territory, Keating was excluded from the Safeguard's Bank Sales Program which had been negotiated with Wells Fargo Bank, Union Bank and others. Keating contends that shortly after he complained about his exclusion, Safeguard notified him they were terminating his contracts. On Aug. 19, Safeguard filed a complaint of unfair competition and other claims against Keating and obtained the TRO denying him access to his former customers and use of mechanisms essential to his business. A formal hearing on the TRO is now scheduled for Nov. 6. Keating also contends that before and after the TRO, Safeguard agents have invaded his privacy and conducted a smear campaign against him, making derogatory statements about Keating's character, honesty and veracity. One of many key issues raised by the suit is ownership of Keating's customer list, for which Keating says he paid Safeguard more than $150,000 during the past eight years. Although Keating believed he was building equity in his own business, Safeguard now alleges Keating did not purchase the customer list; they claim he only purchased the right to "an income stream" while a Safeguard Distributor in good standing. Now that he has been terminated, Keating contends he has nothing to show for his money and eight years of labor. A California and New York bar member, Fishelman, of Stanbury, Fishelman & Levy also represents other former and current Safeguard distributor/franchisees in California. While these other clients are not parties to this particular suit, Fishelman indicated that their complaint against Safeguard was being prepared for filing in the near future. For a copy of the cross complaint or additional information, call Kathryn Kelley at 301-652-8388 -0- 10/16/92 /CONTACT: Kathryn Kelley of Nasuti & Hinkle, 301-652-8388/ CO: Safeguard Business Systems Inc. ST: California IN: SU:
EH-ML -- LA009 -- 0951 10/16/92 12:32 EDT
|Printer friendly Cite/link Email Feedback|
|Date:||Oct 16, 1992|
|Previous Article:||ABF FREIGHT SYSTEM, INC. ANNOUNCES 1993 RATE INCREASE|
|Next Article:||THE MAY DEPARTMENT STORES COMPANY ANNOUNCES ROBINSONS AND MAY COMPANY TO BECOME ROBINSONS-MAY; KAUFMANN'S AND MAY COMPANY TO BECOME KAUFMANN'S|