Consumer Law, Warranties Purchase of intellectual property

[buffalo1]

Wanted to get some feedback on whether or not a new company has liability as it pertains to purchasing intellectual property from an "old" company. Situation is as follows, a company sought out investors and received investment dollars for a new patented shoe concept with the intention of marketing and selling shoes to the general public. After mis-managing business and not actually moving the company forward, the 1st company sells the company name, patented technology and all trademark information to a newly formed company without providing information about the transaction to investors. The new company forms under a different name with completely different principals. Can investors go after the new company due to the patent (value of the old company), the shoe name and trademark being the same as the original company or is the old company the only one liable for repaying investors?

Thanks in advance for your responses.

 

[fredrikklaw]

But of course you can!

Of course you can go after the new company (as well as the old one) who is now the new owner of the "shoe concept" lock, stock, and barrel; even if there is a clever little Indemnification clause in the sale contract making each party responsible for all previous and separately accrued financial obligations.

But something about this scenario does not maketh sense and it rubs me the wrong way, which is why I would first do a thorough research on the new company which is surely formed as some type of corporation under laws of your state in order to eliminate all suspicions of fraud and possible self-dealing. I mean, how difficult is it, after all, to take money from investors on a false pretense and make like the company isn't going anywhere fast and then sell the entire concern to a straw buyer?

If all is legit, you can give the new company the benefit of doubt by informing them of (1) your existence and (2) of your capacity and past dealings with the old company, and (3) of your full expectations to receive the expected and due benefits of your investment in the product. If they do not reply or if their reply is a terse and off-hand dismissal amounting to showing you the middle finger, you then go legal, if you so wish because you will certainly have a few bona fide causes of action.

You can commence litigation by first filing a complaint for breach of contract, to be followed immediately with a petition for a Temporary Restraining Order and Permanent Injunctive Relief. An injunction is important to obtain as it would preserve the status quo and the subject matter, namely the "shoe concept" while the case is being litigated and decided.

Last but not least, if you do go the litigious way, make sure that you join the old company as a defendant as well.

fredrikkaw

 

[buffalo1]

Thank you Fredrikklaw, I'm pretty certain that the former company just took whatever money they were able to get by selling the patent, trademark and shoe name to the new company and aside from receiving cash, they may have been smart enough to ask for a percentage of future sales (I highly doubt that). The shoes are now out for sale to the public as of two months ago and when I contacted the new company to let them know of my debt, their reply was that their company acquired certain intellectual property from the former company back in July of 2008 and that "neither our company nor any of our principals hold any ownership interest or other position with the former company" and referred me back to the former organization for collection. They basically gave me the brush off hoping that I would just go away. I surmise that the former company didn't share any debt information with the new company and the new company didn't bother to do any homework before purchasing the patent, trademark and shoe name.

The new company which has 5 completely different principals is saying they have nothing to do with the debt of the former company and there is ZERO liability on their part. I'm scheduled to get paid on each pair of shoes sold, in addition to my original investment amount. I have signed contractual agreements and I will take your advice of
filing a breach of contract followed by the Temporary Restraining order.

Both companies are based in Texas, however I live in another state but will file the paperwork in the state of Texas.