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Brooks v. Motsenbocker Advanced Developments

July 21, 2008

GEORGE A. BROOKS; BROOKS INDUSTRIES, INC., PLAINTIFFS,
v.
MOTSENBOCKER ADVANCED DEVELOPMENTS, INC.; GREGG A. MOTSENBOCKER; SKIP A. MOTSENBOCKER, DEFENDANTS.



The opinion of the court was delivered by: Honorable Barry Ted Moskowitz United States District Judge

ORDER GRANTING IN PART AND DENYING IN PART MOTION FOR SUMMARY JUDGMENT

Defendants have filed a motion for summary judgment against Plaintiffs. For the reasons discussed below, Defendants' motion is GRANTED IN PART and DENIED IN PART.

I. FACTUAL BACKGROUND

Plaintiff George A. Brooks ("Plaintiff" or "Brooks") explains that in May of 1997, he purchased a bottle of "Motsenbocker's Lift Off" Graffiti Remover in a Maryland store. (Brooks Decl. ¶ 2.) This product ("Product") was a biodegradable, water-based, nonflammable, liquid cleaner used to remove paint and paint-like coverings and deposits. (Id.) Brooks tried using the Product as a stripper for removing clear-coat from brass. (Id.) Brooks's testing showed that the Product worked well as a stripper of metal. (Id.) Brooks performed the testing because he believed that there was a need in the industry for a good water-based brass stripper. (Id.)

Brooks states that in May of 1997, he called Motsenbocker Advanced Developments, Inc. ("MAD"), and spoke to Gregg Motsenbocker ("Gregg"). (Id. at ¶ 3.) After Gregg assured Brooks that he would not steal Brooks's ideas, Brooks explained to Gregg that as a result of deaths of workers while stripping brass with flammable strippers, there was a great need for a non-flammable brass stripper in the painting industry. (Id. at ¶ 4.) At Brooks's suggestion, they began referring to the Product as "Brass Wash." (Id.)

In approximately June of 1997, per Gregg's request, Brooks demonstrated the use of the Product to Stuart Dean and Aztec, large metal refinishers, and a company called Reemco in New York. (Id. at ¶ 5.) In July 1997, Gregg requested that Brooks demonstrate the Product to Walt Noga ("Noga") of Ecolab, Inc. ("Ecolab"), the company that possessed the exclusive rights to market the Product wholesale. (Id. at ¶ 6.)

In or about August of 1997, Ecolab agreed to pick up the Product (now named "Brass Wash"). (Id. at ¶ 7.) According to Brooks, he entered into a written contract with Ecolab which made Brooks the exclusive North American sales representative of the Product sold as a stripper to remove coatings such as paint, lacquers, and varnish. (Id.) Under the terms of the agreement, Brooks was to be paid exclusively by commission, earning 12% of the first million dollars in sales, 10% of the next half million, and 8% thereafter. (Id.) Brooks was to receive commissions on all North American wholesale sales whether he initiated the sale or not, and was to receive such for as long as Ecolab had the right to distribute the Product. (Id.) Brooks does not have a copy of the agreement. According to Ecolab, any such agreement was destroyed under Ecolab's retention program. (Ex. B to Brooks Decl.)

In or about 1998, Brooks further experimented with the Product and discovered it worked as a remover of paint from wood without damage to the part or the panel. (Id. at ¶ 12.)

In 1999, in addition to working with the Product, Brooks worked with the Sherwin Williams Company to develop a water-based clear coat to protect metal and wood that could be removed with the Product without leaving a stain on the metal. (Id. at ¶ 8.) Brooks perfected the covering, Sherwin Williams produced it, and MAD marketed it under the name "Motsenbocker's Lift Off Finish Coat" (hereinafter "Finish Coat"). (Id.)

In 1999, shortly after the perfection of the Finish Coat, Gregg told Brooks that MAD was ending its relationship with Ecolab. (Id. at ¶ 9.) Gregg, on behalf of MAD, offered to engage Brooks as the North American sales representative for the Product and Finish Coat. (Id.) MAD and Brooks entered into an oral agreement ("Agreement") with the same terms as the agreement with Ecolab except that (1) Brooks's commission on the sale of the Product and Finish Coat would be a flat 10% of all sales, wholesale or retail; (2) Brooks was free to market the Produce under whatever name Brooks and MAD agreed upon; and (3) MAD and Brooks would work together to vary the formula if doing so would improve it. (Id.) According to Brooks, it was agreed that Brooks would start marketing the Product as soon as Ecolab was no longer marketing the Product, and that Brooks's contract would be for the lifetime of the Product. (Id. at ¶ 10.)

In October 2004, Brooks traveled to San Diego and was employed by MAD until May 2005. According to MAD, Brooks was employed as a "warehouseman." (Motsenbocker Decl. ¶ 8.) Brooks denies that he was a "warehouseman." Brooks contends that he was employed as a salesman for MAD's other products and was given the title "PK for Product Knowledge." (Brooks Decl. ¶ 26.) During his employment, he did not work on the Product or Finish Coat during Company time, but, rather, promoted the Product and Finish Coat after hours and on weekends. (Id.)

In 2000, under the Agreement, Brooks began marketing the Product and conducted experiments to further develop it. (Id. at ¶ 11.) In 2000, Brooks promoted the Product as "Coating Remover," and in 2001, Brooks began marketing it under the additional name, "Lacquer Remover." (Id.) In 2001 through 2004, Brooks further experimented with the Product and made some of the Product into gel form and distributed samples of the Product in that form. (Id. at ¶ 14.) Brooks's marketing efforts from 2000 to May, 2005 include the following:

* A 2000 trip to Des Moines, Iowa, which resulted in a highly positive review of the Product in The Wood Magazine.

* A 2000 trip to Chicago to demonstrate the Product at a national hardware show.

* A 2002 trip to Washington, D.C., to demonstrate the Product at the True Value Ace Hardware Show.

* 2003 trips to Stuart Dean offices throughout the United States to give training presentations on how to use the Product.

* Trips to the Metal Polishers Union Meany training center in 2000, 2001, 2003, 2004, and 2005.

* Promotion of the product at a 2005 trade show in New Orleans.

* Promotion of the Product in 2003 in San Diego and Los Angeles (Id. at ¶¶ 16-25.)

During the period between 1999 and May, 2005, Brooks also entered into contracts for the performance of services (e.g., refinishing brass elevators) using the Products. (Id. at ¶ 34.) According to Brooks, the profits from these contracts were minimal or non-existent. (Id.) However, these contracts provided opportunities to show how well the Product worked and to obtain endorsements. (Id.)

From 1999 to 2005, Brooks wrote the following materials to promote the Product: a 1999 book entitled "The Proper Techniques and Procedure for Applying and Using Motsenbockers Liftoff Lacquer Remover and Motsenbockers Liftoff Finish Coat for the Purpose of and How to Refinish Wood & Metal" (modified in 2001); a 2003 booklet entitled "Product Information Booklet" for the Lacquer Remover and Finish Coat; a 2003 booklet entitled "Safe & Simple Step-by-Step Instructions on How to Restore and Clean Mirror & Satin Finish Brass"; and various sales fliers and product ...


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