Distributors file case to collect royalties

Sunday, June 1, 2003

SAN DIEGO, Calif. - Two men who signed agreements to distribute automatic theft detection products from a company that later became Sensormatic have filed a lawsuit against the company and its parent Tyco International claiming they are no longer receiving royalties that are due to them.

The lawsuit, filed in the U.S. District Court for the Southern District of California, claims breach of contract, negligent misrepresentation and fraud. It was filed by Cassandra Dunn, trustee of the Donald S. Kendall Family Trust, and John Hartunian.

The lawsuit claims that under a franchise agreement signed in 1967 between Kendall, Hartunian and JKR Corp., the two were to collect royalties on JKR’s automatic theft detection products, including products not yet designed. JKR later became Sensormatic.

According to court documents, the plaintiff’s claim that the Kendall Family Trust and Hartunian have not been paid royalties since July 2002 and have since been denied access to accounting information to determine how much in royalties they are owed. In court documents, it says that the plaintiffs “cannot know the full extent of their loss without an accounting of the defendants’ sales of franchisor’s products.”

In February a judge dismissed Tyco as a party in the lawsuit.

Officials from Tyco declined to comment, citing that the company does not comment on pending litigation. Several telephone calls to the attorneys for the plaintiffs in this case were not returned.

The plaintiffs in the case have requested a jury trial and are seeking back royalties, interest and punitive damages.