Court Tosses Out Lawsuit Against PowerSki. PowerSki Moves Forward With $112 Million Lawsuit Against Encompass Holdings, Inc. And Others.
PowerSki moves forward with $112 million dollar lawsuit alleges misappropriation of trade secrets, unfair competition, breach of contract, and 21 other causes of action.
SAN CLEMENTE, California-February 17, 2006- PowerSki International, Corp., the Southern Californian developer of a high performance jet powered surfboard called the PowerSki Jetboard™, announces that the Los Angeles District Court issued an order today that dismiss a lawsuit against PowerSki. The lawsuit alleged that the PowerSki JetboardsTM were not “production ready.” The Court, however, ruled that “there is no indication how” plaintiffs allegations “would render untrue [PowerSki’s] statement that the [PowerSki J]etboards were production-ready.” (Emphasis added.)
Last month, PowerSki announced that it had filed a lawsuit against thirty defendants including Nova Communications, Ltd., now Encompass Holdings, Inc., Aqua Xtremes, a Nevada Corporation, and CyberAds, Inc., a Florida Corporation located in Torrance, California (OTCBB:ECMH and OTCBB:CYAD).
The suit was filed in the State Court of California, for twenty-four causes of action, including fraud, misappropriation of trade secrets, business interference, unfair competition, breach of contract, and Racketeering Influence and Corruption Organizations Act (RICO) violations.
The PowerSki Jetboard™ is a revolutionary recreational water vehicle resembling a surfboard with an engine that has wide appeal to anyone who enjoys time near the water. The PowerSki Jetboard™ has taken years to develop. PowerSki was working to release it to the world wide market, with investors and vendors in diverse locales- from states like California, Florida, Hawaii, Michigan, Washington, and Utah, to the Caribbean and Australia, among others -when difficulties arose allegedly caused by the defendants named in the lawsuit. PowerSki originally agreed to merge with Nova in May 2003 in order to produce the PowerSki JetboardTM, requiring Nova’s funding of $2,000,000.00 for working capital. The suit alleges that Nova failed to pay even half of the required amount, and intentionally delayed production and release of the Powerski JetboardTM. The suit alleges merger agreements also prohibited unauthorized transfer or use of PowerSki’s proprietary information.
PowerSki’s lawsuit alleges that Nova never intended to merge, that certain officers made efforts to inflate the price of Nova stock by promoting mergers that it did not intend to complete, and that Nova and others, including the plaintiff in the case dismissed today, filed baseless lawsuits to improperly destroy the economic value of PowerSki and to inhibit PowerSki JetboardTM production.
PowerSki’s lawsuit alleges that Nova, its former CEO Kenneth Owen, current CEO Arthur Robins, and the other defendants, including former PowerSki employees, used stolen proprietary information and conspired to design and market a substantially similar competing product dubbed the “X-Board.” The proprietary information allegedly included undisclosed prototype designs, business plans, contact lists, marketing plans, manufacturing methods, and other intellectual property that pertained to PowerSki JetboardTM-related business. The defendants also allegedly sought to undermine PowerSki’s business so they could eliminate PowerSki as a competitor. PowerSki’s lawsuit alleges that in 2004, less than three months after signing a confidentiality agreement, Robins instructed PowerSki’s vendor Premium Allied Tool of Texas, Inc. to stop production on the PowerSki JetboardTM, while secretly beginning production of the “X-Board” with Premium Allied Tool under the guise of sham corporations.
PowerSki’s lawsuit seeks damages in the amount of $112 million as a result of marketplace injury and unfair competition allegedly caused by Nova. The lawsuit also demands that Nova cease its anti-competitive practices and follow the specific requirements in the confidentiality agreements.
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. PowerSki’s claims allege that Goldenberg remains a key figure behind Nova.
“PowerSki is in the enviable position of owning the rights to manufacture the PowerSki JetboardTM,” said Robert Montgomery, president and CEO of PowerSki. “It is clear from our stand point that we have an extremely compelling case against Nova and the other cross-defendants. PowerSki 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.”