Tuesday, March 21, 2006
Mario Industries wins lawsuit against rival
Mario had accused a former employee of using insider information.
A Roanoke lamp manufacturer has won a $1.5 million jury verdict against a rival company founded by a former employee.
During a two-week trial in Roanoke Circuit Court, Mario Industries Inc. accused its former sales contract manager, Troy Cook, of setting up rival corporation Renaissance Contract Lightning & Furnishing Inc. while on Mario's company time and using inside knowledge to lure sales reps away and divert contract jobs. Mario lost $2.7 million in sales over two years because of Renaissance's unfair practices, the company said.
Mario was in danger of going out of business because of the contracts the company was losing to Renaissance, said attorney Matt Broughton of the firm Gentry Locke Rakes & Moore. The verdict "means there are 70 employees in Roanoke who will have a job tomorrow," the attorney said.
The jury verdict also ordered Cook to pay Mario $56,700 in punitive damages.
"We were surprised and disappointed by the verdict," said Claude Lauck of Glenn, Feldmann, Darby & Goodlatte, which represented Renaissance. "We did not think it was the correct conclusion and we expect to appeal."
In court, Renaissance argued that the company had done nothing illegal or unethical.
The jury also found four individual defendants liable for the $1.5 million: Cook, who is Renaissance's vice president; Renaissance President Joseph Cassell; and sales representatives Betty Banks of Richmond and the Darnell Group of Chicago.
A family-run business founded in New York in 1922, Mario Industries moved to Roanoke in 1988.
The company has two divisions: a contract sales segment that sells large orders for companies or institutions such as hotels, nursing homes and colleges; and a unit that sells lamps to retail stores and catalogs.
The company's factory is on Patterson Avenue in Northwest Roanoke. President Louis Scutellaro said Mario employs about 70 people.
Cook left Mario in November 2003 and founded Renaissance, in Northeast Roanoke, with Cassell.
Mario accused Renaissance and its co-defendants of conspiring to compete with Mario and interfering with Mario's contracts.
The suit also alleged that Cook, Cassell and Renaissance stole trade secrets from Mario.
Mario originally sued for $1 million but recently increased its demand to $5 million. The trial began March 6 and ended Thursday.
The jury returned its verdict Friday evening.
Attorneys for Mario said that Cook was in contact with his future partners in Mario while he was working there, using e-mails and cellphone calls to set up the business.
In court, Mario accused him of destroying important business documents on his computer before he left.
Cook got some Mario sales reps to offer quotes from Renaissance by offering them better commissions and stock in his company, said Broughton.
In one instance in Chicago, a sales rep took a quote from Mario and sent it to Renaissance, who copied it and offered it as its own, he said.
Broughton noted that the jury found in Mario's favor even though Mario did not have a written covenant forbidding sales reps from selling competing product lines.




