Michael Friedman’s legal dispute with Ocean Tomo LLC, the patent brokerage run by CEO James Malackowski, is only the latest example of the ways Ocean Tomo has allegedly harassed and/or withheld compensation from its own partners, business partners and employees.
Friedman sued Ocean Tomo in Cook County Circuit Court in December alleging that Ocean Tomo owes him $922,859 in compensation for calendar years 2013 and 2014. He also is seeking his compensation for 2015.
The complaint also alleges that Ocean Tomo accused Friedman of breaching his fiduciary duty to Ocean Tomo with regard to an investment deal that closed in November 2015 — the sale of a Blackberry Corp. patent portfolio to Centerbridge Partners — and using it as a reason for denying payment of compensation.
Friedman disputes the allegations and is not alone in facing such harassment from Ocean Tomo.
Jonathan Barney, the founder and CEO of Patent Ratings LLC and a former managing director and 10% owner of Chicago-based Ocean Tomo, who left in February 2011, said that Ocean Tomo allegedly withheld 5-years of dividends owed to him and has harassed him and interfered with his business by filing several lawsuits against him and against Patent Ratings.
Several other former Ocean Tomo executives including Andrew Ramer, now with Cantor Fitzgerald, and Elvir Causevic, now CEO of Black Stone IP, declined to comment. Another, Michael Lasinski, now CEO of 284 Partners, couldn’t be reached for comment.
“I’ve been sued by Ocean Tomo four or five times,” Barney said in an interview. “I’ve always been a defendant but I’ve filed a counterclaim against them similar to the lawsuit filed by Michael Friedman.”
Barney said he was not surprised by the silence of other former Ocean Tomo employees, because when he sought to question several former Ocean Tomo employees during his legal disputes with Ocean Tomo he found they were bound by confidentiality agreements.
In addition, Barney said there are two pending cases filed by Ocean Tomo against him for alleged theft of trade secrets and other charges he describes as “trumped up,” and against Patent Ratings for alleged failure to pay revenue owed under a licensing agreement. Ocean Tomo is a partial owner of Patent Ratings.
Barney said he defeated a $3.5 million breach of warranty arbitration claim filed by Ocean Tomo against Patent Ratings. The claim was filed in 2011 and the final decision came in 2012.
In addition, Ocean Tomo also filed a petition for a covered business method review to invalidate a patent invented by Barney and owned by Patent Ratings. The Patent Trial and Appeal Board on Jan. 25 denied the CBM review.
“We agree with Patent Owner that a real and substantial controversy regarding infringement of the ’849 patent has not been created by Petitioner’s cause of action in the Illinois action seeking declaratory judgment of non-breach of the License Agreement," a PTAB panel said.
"The controversy between the parties, regarding alleged contractual and tortious conduct arising out of an employment and business relationship gone awry, does not meet the threshold requirements of 37 C.F.R. §42.302(a). The proper forum for the parties’ disputes is the district court, not the Board in the guise of a covered business method petition challenging patentability of claims in the ’849 patent, as to which neither a suit alleging infringement nor a charge of infringement has occurred.”
The CBM petition explained that since 2007, Ocean Tomo and Patent Ratings’ business relationship “has been plagued by a number of disputes, including three separate lawsuits which have been consolidated into a single action before the U.S. District Court for the Northern District of Illinois.”
In that action filed in 2012, Ocean Tomo alleged breach of contract, breach of fiduciary duty, violation of the Illinois Trade Secrets Act, violation of the Computer Fraud and Abuse Act, conversion, and tortious interference with prospective economic advantage, arising out of Barney’s destruction, copying, and use of Ocean Tomo’s confidential information and trade secrets, along with his and Patent Ratings’s attempt to divert a business opportunity away from Ocean Tomo. Ocean Tomo likewise was seeking a declaratory judgment establishing that it is not tortiously interfering with Barney’s and Patent Ratings’ business expectancies or relationships.
Barney and Patent Ratings denied the allegations and brought a counterclaim, which accused Ocean Tomo of launching a “malicious, underhanded campaign to wrongfully oppress and freeze out” Barney, and “cheat” him out of the substantial benefits that Ocean Tomo promised to him in 2004 when Ocean Tomo induced him to exchange an ownership interest in Patent Ratings for a minority ownership interest in Ocean Tomo.
The counterclaim also alleged that Ocean Tomo attempted “to destroy Mr. Barney and PatentRatings financially so that Ocean Tomo could steal the very valuable PatentRatings system and the underlying patents, data, algorithms, and other valuable intellectual property owned by PatentRatings.”
The counterclaim accused Ocean Tomo of breaches of contract, breaches of the implied covenant and fair dealing, fraud, tortious interference with prospective economic advantage, and violations of the Computer Fraud and Abuse Act. Barney is seeking to recover punitive damages “to punish Ocean Tomo for its willful, malicious, and fraudulent conduct, and to compel Ocean Tomo to provide access to the books and records of the company.”
Barney said the case is expected to go to trial this year.
Meanwhile, Barney and Ocean Tomo will be facing off in another lawsuit filed in 2014 in California Superior Court in Orange County on March 21. In that complaint, Ocean Tomo alleges that Barney made loans to Patent Ratings in violation of the operating agreement the two companies signed. It also alleged that Barney is paid an excessive salary by Patent Ratings and improperly used Patent Ratings to pay for his personal legal fees.
Barney has denied the allegations and filed a counterclaim based on breach of contract.
The dispute underlying the Orange County case concerned Ocean Tomo’s alleged refusal to make a required capital contribution of $100,000 to Patent Ratings based on Ocean Tomo’s 25% stake in Patent Ratings.
Ocean Tomo officials declined to comment.
—To reach the reporter responsible for this story please contact Dan Lonkevich at 707 318-7899 or at firstname.lastname@example.org