Suit Alleges Copyright Violations

September 19, 2003
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A publisher of educational workbooks and flashcards for children claims a competing firm set up by a former sales manager is a “sham corporation” that intentionally violated trademarks and copyrights and engaged in unfair competition.

Grand Haven-based School Zone Publishing Inc. charges Dogs In Hats LLC and its founder, Peter Alfini, with 84 counts of trademark and copyright infringement. School Zone claims in a federal lawsuit that Dogs In Hats willfully violated 38 of its trademarks for graphic elements used in numerous workbook and flash card titles.

School Zone is asking the court to award it all of Dogs In Hats’ profits generated by the allegedly copied materials, as well as statutory and punitive damages, the latter of which a judge could triple if the court deems the violation willful and could grow to a substantial amount.

“School Zone has no problem with fair competition, but you have to draw the line when your former employee leaves you and comes out with competing products that we believe to be a violation of their trademark,” said attorney Thomas Williams, School Zone’s co-counsel on the case from Grand Rapids the law firm McGarry Bair PC.

Jovan Jovanovic, a Holland attorney representing Dogs In Hats, declined comment on the case. Dogs In Hats has until Oct. 3 to file a legal response to the lawsuit; a response that Jovanovich says, “will be very interesting.”

Founded in 1979, School Zone publishes more than 200 educational workbook titles and numerous flashcard sets and software for elementary-aged children. The company’s products are sold at retailers nationwide such as Wal-Mart, Sam’s Clubs, Walgreens, Target, Barnes & Noble and Meijer.

In the lawsuit, filed Aug. 14 in U.S. District Court in Grand Rapids, School Zone claims that Alfini, while working as vice president of national sales, used his “virtually unfettered” access to proprietary information and essentially stole graphic elements to develop his own flashcard sets and workbooks and form his own company.

Court papers indicate that Alfini, who began his position at School Zone in November 2001, received an e-mail on Dec. 9, 2002, from a buyer for Target stores, inviting the company to submit a sealed bid for shelf space on an end cap, a high-profile shelf at the end of a shopping aisle. Alfini, the lawsuit claims, never shared the e-mail with company executives and used it as the basis for founding his own company.

“Alfini decided to use the opportunity for himself,” School Zone lawyers claim in court papers.

Alfini submitted his letter of resignation to School Zone on Feb. 21, but agreed to work for two weeks in order to assure a smooth transition. Two days after submitting his letter, on a Sunday afternoon, he returned to the business and, with the help of a School Zone co-worker he subsequently hired at Dogs In Hats, used a color copier to copy several of School Zone’s products, the lawsuit alleges.

On March 3, four days before his employment ended, his lawyer filed papers with the state Department of Consumer and Industry Services to form Dogs In Hats LLC.

In mid-July, Dogs In Hats’ workbooks and flashcards debuted on end-cap shelves at Target stores across the country, School Zone contends. Elements of the Dogs In Hats products — consisting of cover designs, illustrations, page layout, format, colors, lettering styles, words and shapes, exercises, activities and text — are “substantially” or “very similar” to School Zone’s and constitute a willful violation of copyright and trademark protections, Williams said.

Dogs In Hats, based in Grand Haven, is “a sham corporation” that is “a mere instrumentality of its officers or principals and/or a device to avoid legal obligations,” the lawsuit states.

In pursuing its claims against Dogs In Hats in federal court, School Zone is seeking to protect the intellectual property on which the business is founded, said attorney Mary Bonnema of McGarry Bair, co-counsel in the case.

“If you don’t enforce and protect your trademark rights, you lose them,” Bonnema said. “School Zone is built on the backbone of its intellectual property. What it has is its creative works. It goes back to the point of fair and unfair competition.”    

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