AMERICAN LAWYER MEDIA
Jury Verdicts & Settlements
$2.5 million award after breakup to skin-cream creator’s partner
October 08, 2009
By: Review staff & VerdictSearch
Case: Beauty Development Corp. on behalf of Pure Products Inc. v. Joel Meyerson, Pure Source, Inc. and Pure Products Inc.; Pure Source and Joel Meyerson v. Robert Bell
Case No: 06-05446CA09, 06-03086CA09
Description: Shareholder derivative suit
Filing date: March 20, 2006
Trial: May 18-21, 2009
Judge: Miami-Dade Circuit Judge Thomas “Tam” Wilson
Plaintiff attorneys: Andy Hall and Adam Lamb, Hall Lamb & Hall of Miami
Defense attorneys: Glen Waldman and Eleanor Barnett, Heller Waldman of Miami
Outcome: $2.49 million in damages awarded to Bell
Details: Joel Meyerson, a Miami inventor and businessman, created an anti-aging cream called Strixaderm. In 2004, he and his company, Pure Source, were sued by Klein Becker, which manufactures a competing product called Strivectin, for trademark infringement. Meyerson agreed to the terms of a restraining order requiring him to reformulate, remarket and repackage his product. He turned to Robert Bell, a Miamian famed for creating Banana Boat suntan lotion, which he sold for $60 million, and for reconstituting Sea & Ski, another tanning lotion. In 2004, the men entered into an ownership agreement calling for Bell to become a one-third partner in Strixaderm. Meyerson held a two-thirds stake. A new company, Pure Products, was formed as the worldwide distributor for the new product. But Meyerson wanted to move forward quickly and introduce the products to mass-market stores, while Bell wanted to build the brand slowly. Meyerson wrote Bell to end his contract.
Several lawsuits ensued. Ultimately, Bell’s Beauty Development filed suit against Meyerson, alleging he siphoned off all the sales and took $520,000 in profits without sharing it with Bell. Bell also alleged a buyout provision in the contract called for Meyerson to pay Bell $1.8 million. Meyerson countersued for breach of contract and claimed he had not read the partnership agreement carefully. After mediation failed, both agreed to a bench trial.
Plaintiff case: The fact that Meyerson had not read the partnership agreement carefully was no excuse. Forensic accountant Phil Schecter of Berenfeld Spritzer Schecter & Sheer was called as a witness to testify about the profits that should have gone to the distributor and calculate the amount due to Bell under the buyout agreement.
Defense case: Bell did no work. Meyerson did all the work and deserved the profits.
“Bell did not put any time into this venture,” Waldman said. “He was supposed to hire a sales force. He made zero sales.”
Results: Wilson asked both sides to draft proposed orders. He signed Hall’s 32-page order Sept. 20, awarding $2.49 million in damages to Bell plus interest.
Quote: “Meyerson never intended to perform,” Hall said. “He was siphoning off all the profits for himself, and he got caught.”
Post-trial motions: Waldman’s motion for reconsideration was denied by Wilson, who is retiring today.
— Julie Kay
Photo by A.M. Holt