Jules Jordan Video Files $5M Suit Against Manwin, Former GM Scott Justice

Apr 11, 2012 2:00 PM PST

CHATSWORTH, Calif. — In a suit seeking in excess of $5 million in damages, Jules Jordan Video Inc. claims Manwin and its former general manager conspired to steal its distribution business by lifting proprietary information, destroying data and poaching key staff.

The suit charges that when Scott Justice, Jules Jordan Video's longtime former general manager, departed suddenly from the Woodland Hills, Calif., company last July, Manwin broke off ties with its distribution partner. On that day, Jules Jordan Video said it received a hand-delivered letter that demanded that it cease distributing Manwin, Mofos and Brazzers DVDs.

Over the course of a week, more shocking developments came forth: Jules Jordan Video was losing its staff.

Jules Jordan Video's production manager Andrew Weber, office manager Bonnie Shapiro, warehouse manager Rodolfo Soto, warehouse employee Mario Lara and sales representative Brett Reisner all tendered their resignations.

In the suit, the company says that "most of the other departing employees immediately began working for [Manwin]" and started contacting its customers. Jules Jordan Video contends that one of its former employees started using its proprietary information as leverage in a sales deal just two days after leaving the company.

"[Justice] arranged for [Jules Jordan Video's] distribution services to be essentially transferred to  Manwin as a turnkey operation," the suit says. "[Justice] and the Manwin defendants knowingly and willfully conspired and agreed among themselves to engage in the wrongful conduct ... as part of their scheme transfer [Jules Jordan Video] distribution network to the Manwin defendants."

The suit makes additional allegations as well, including one that Justice deleted company emails and other data, including customer contact information and content, after he left Jules Jordan Video.

Jules Jordan Video alleges that when Justice left after three years with the company, he was finalizing two month's worth of content for Playboy pursuant to a licensing deal.

"When he departed ... [Justice] took the computer hard drive containing the content ... and shipped the hard drive to the Manwin defendants. As a result [Jules Jordan Video] could not deliver the content on that hard drive to Playboy or receive payment from Playboy," the suit said.

In other charges, Jules Jordan Video says that Justice was given a company car — a 2008 Cadillac Escalade — in return for monthly payments but has refused to return it and that he put his girlfriend on the company's employee health plan.

Jules Jordan Video said that the girlfriend never worked at the company and was "secretly and fraudulently added to the ... employee health plan."

Jules Jordan Video's suit, which was amended and approved last week to add other charges, asks for damages for breach of fiduciary duty, conversion, breach of contract, fraud and conversion, as well as relief for violating California's penal code over destroying computer data.

Meanwhile, Manwin unit Froytal, which also is named to the suit, filed a cross complaint stating causes of action for breach of oral contract and declaratory relief, among others.

Manwin officials declined to comment to XBIZ, while Scott Justice was unable to be reached. Jules Jordan Video attorney Gary Gorham did not immediately respond for comment by post time.

A trial date is set for March 2013 at Los Angeles Superior Court.

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