Legal Fight Splits Principals Of Web Talent Search Firm.

The co-founders of Iam.com, a Santa Monica-based Web site that operates as an online talent agency, are being sued for at least $50 million in a lawsuit claiming that the business model for the site was misappropriated.

Roger Wilson, a member of Iam.com' s board, and Brian Gersh, director of Iam.com and the former head of motion picture talent development at the William Morris Agency, are among those named as defendants in the lawsuit filed in Los Angeles Superior Court earlier this month.

The suit alleges that Wilson and Gersh took an aspect of a confidential business plan vetted by Infanet Online Corp., a firm that the two helped to incorporate, and used it in a pitch for venture capital funding from Sierra Ventures for what they claimed was a separate project.

"This is what happens when there is a schism between the brain trust people and those who consider themselves to be captains of the Internet industry," said Eileen Cohn, the attorney for Infanet. "You can't take the (intellectual) property and go somewhere else and use that for the benefit of a new company. You have to let the plan's merits rise and fall with the original company."

'Claims without merit'

Officials with Iam.com declined to comment, but did release a statement on the lawsuit.

"The claims of Infanet are wholly without merit. It is clear that this litigation is part of a vendetta by disgruntled individuals seeking to injure Iam.com for personal gain. Iam.com intends to vigorously defend itself in the Infanet litigation, and to immediately bring appropriate claims against those who are at the core of this scheme to hold up the company," the statement reads.

According to the lawsuit, Infanet was incorporated in October 1998 by Wilson and several other individuals, including Michael Ferrantino, current director of the company, and Elizabeth Berkley, the actress best known for her roles in "Showgirls" and the teen sitcom "Saved by the Bell." Gersh, the agent for actors Sean Penn and Jackie Chan, was later brought in to introduce the company to potential investors, according to the lawsuit.

The business plan of the first project developed by Infanet was originally slated to go up on the Web as "Whynot-u.com." It was divided into two parts. The first was to develop Internet-based business-to-business software for use by talent agents, managers, producers and individual artists, according to the suit.

"It would involve digitizing everything in an actor's portfolio so that it could be accessed on the Internet," Cohn said. "If someone said 'I don't think so-and-so is good for that part' while looking for an actor to fill a role, an agent could then bring up online a video of that actor in some bit part 20 years ago to show their work."

Investors introduced

The second part would be a "digital star search," according to the complaint. In this phase, a nationwide advertising campaign would encourage Internet-savvy wannabe talent to submit head shots and bios online.

As part of his job to bring potential investors into the fold, Gersh introduced Infanet board members to Jeffrey Drazan, a representative of Sierra Ventures, the complaint states. Drazan and Sierra Ventures are also named as defendants in the lawsuit.

"During that meeting, Sierra Ventures rejected the first phase 'b2b model' of Infanet because the market was too limited and only offered 'millions' not 'billions' of dollars in projected market capitalization and/or annual profits," according to the complaint. "Sierra Ventures posited that the more lucrative 'star search' market did not have to wait for the development of the 'b2b' market, but could be launched independently."

Most of the Infanet board disagreed with the Sierra Ventures notion that the star search component and the software segment of the business plan could be separated.

But according to the lawsuit, Wilson and Gersh decided to meet privately with Sierra Ventures, starting in February 1999, to discuss a business enterprise apart from Infanet that used the "star search" component of the Whynot-u.com business plan.

"What Infanet argued, even though the digital star search isn't our main interest, (is) you really can't do one without the other," Cohn said. "It's an integrated system."

Iam.com is funded

According to the complaint, Wilson repeatedly told Infanet board members that his independent project did not follow the same business model as the one they had developed together, even after the new project, which became Iam.com, received funding from Sierra Ventures.

However, according to the complaint, Iam.com is now launching the software segment of the Infanet business plan in addition to the star search part of the project.

"The members of one corporation have a duty to not compete, to not go and form another corporation and adopt (the original company's) plans," Cohn said.

Iam.com has 30 days to respond to Infanet's complaint, which includes 18 separate causes of action, including breach of fiduciary duty, fraud and deceit, and intentional interference with prospective economic advantage.

Outside the legal realm, Iam.com is on pace with its talent recruitment plans.

The company is taking out catchy ads in several national and local publications, seeking "actors, musicians, models and dancers to launch a revolution." This casting call for "cyber portfolios" will lead to eight finalists being selected for an appearance in a 90-second television commercial that will air during the Academy Awards and on MTV.