Power Ski International, Corp. Files Lawsuit Against Nova Communications, Ltd. $112 million dollar lawsuit alleges misappropriation of trade secrets, tortious interference, unfair competition, breach of contract, and twenty other causes of actions.
SAN CLEMENTE, California-January 19, 2006- Power Ski International, Corp. (PSI), the developer of the PowerSki Jetboard™, a high performance jet powered surfboard, announced today that it has filed a lawsuit against Nova Communications, Ltd. (NOVA), Cyberads, Inc., Aqua Xtremes (OTCBB:NVAC and OTCBB:CYAD) and twenty-seven others in the State Court of California, for twenty-four causes of action, including misappropriation of trade secrets, tortious interference, unfair competition, breach of contract, and Racketeering Influence and Corruption Organizations Act (RICO) violations.
PSI originally entered into a Letter of Intent to merge with NOVA in May 2003 in order to produce the PowerSki Jetboard™. PSI’s lawsuit alleges that NOVA never intended to merge. Despite entering into two Memorandum of Understanding requiring the payment of $2,000,000.00 in working capital funding, the suit alleges that NOVA failed to pay even half of the required funding. These agreements also require that the PSI trade secrets and confidential information be held in confidence, and prohibit unauthorized distribution, transfer, or use.
The lawsuit alleges that NOVA, it’s former Chief Executive Officer Kenneth Owen, it’s current Chief Executive Officer Arthur Robins, and the other cross-defendants, including former PSI employees, conspired and did use stolen proprietary information to design a substantially similar competing product dubbed the “X-Board” and sought to undermine PSI’s business to eliminate PSI as a competitor. PSI’s lawsuit alleges that in 2004, less than three months after signing a confidentiality agreement, NOVA’s current Chief Executive Officer Arthur Robins instructed PSI’s vendor James Able of Premium Allied Tools of Texas, Inc. (PATx) to stop production on the PowerSki Jetboard™, while secretly beginning production of the X-Board with PATx under the guise of sham corporations. PSI’s lawsuit further alleges that NOVA used confidential information and trade secrets owned by PSI to design, develop, and market the X-Board. This included undisclosed prototype designs, business plans, contact lists, marketing plans, manufact ring methods, and other intellectual property that pertained to Jetboard-related business. The 100 page Cross – Complaint alleges that as part of their efforts to improperly destroy the economic value of PSI, NOVA and others filed baseless lawsuits against PSI to inhibit PowerSki Jetboard™ production.
PSI’s Cross-Complaint also alleges that certain officers have operated NOVA, Cyberads, Inc., Aqua Extremes, Inc., NovaNet Media, Inc., Xtreme Manufacturing, Inc. PATx and other businesses as though they were a single entity, commingling officers, funding, and employees, in an effort to pump the price of NOVA stock up by promoting mergers that it did not intend to complete.
As a result of NOVA’s unfair competition and the marketplace injury sustained by PSI, PSI is requesting damages no less than $112 million. PSI is also demanding that NOVA cease these anti-competitive practices based on specific requirements in the confidentiality agreements entered into by NOVA, its officers, directors, and employees. The lawsuit alleges that NOVA, formerly known as First Colonial Ventures, Inc. has faced legal scrutiny before. The lawsuit further alleges that former NOVA President, Murray Goldenberg was convicted at trial for participating in a plan to promote NOVA securities through secret bribes in 1996. PSI’s claims allege that Goldenberg remains a key figure behind NOVA.
PSI’s lawsuit was filed by the Long Beach law firm of Trutanich-Michel, LLP, which represents high profile clients from the sporting goods industry. PSI announced that the law firm had been retained to research and investigate possible violations of PSI’s intellectual property rights as well.
“PSI is in the enviable position of owning the rights to manufacture the PowerSki Jetboard™,” said RobertMontgomery, president and CEO of PSI. “It is clear from our stand point that we have an extremely compelling case against NOVA and the other cross-defendants. PSI has had more than its share of attempted takeovers, but we remain steadfast in our mission to bring the PowerSki Jetboards™ to the world market.”
PSI Press Release1 Lawsuit against Nova Jan 19 2006.pdf