Screw and barrel maker Flite Technology Inc., which filed for Chapter 11 bankruptcy protection in March, now has filed a $7 million lawsuit against local competitor Advanced Technologies Worldwide Inc., run by a former partner of Flite President Ronald Anderson.
Anderson alleges the defendants, while they were employed at Cocoa, Fla.-based Flite, stole trade secrets and customer lists and hired away key employees in violation of signed agreements. He also says they spread derogatory information to customers through faxes and telephone calls — including a bogus fax on letterhead from the Washington-based Society of the Plastics Industry Inc. After hundreds of faxes went out, Anderson said, ``We had all of our customers call us about this within a 48-hour period.''
The defendants, who now work at rival screw builder Advanced Technologies in nearby Cape Canaveral, Fla., deny the charges.
``He's trying to blame somebody for his failure,'' said defendant Joan Ortiz.
Both sides paint a picture of a business relationship gone sour. Ortiz, now president of Advanced Technologies, in 1981 became a partner of Anderson's. In 1991, in a forced buyout mediated by a third party, Anderson purchased Ortiz's half of the company for $350,000. Anderson and Ortiz both say that, as part of the sale negotiations, Ortiz was not required to sign a noncompete agreement.
She started her own company that same year.
The two sides disagree on whether, and what kind of, agreements were signed by the other defendants and other Flite workers. Anderson said other employees did sign noncompete and confidentiality agreements.
But Ortiz's daughter Debra Ann Ortiz Concepcion, who is named in the suit, said she never signed anything. She had handled sales to Latin and Central America for a year at Flite. Her husband, Arsenio Concepcion Molina, also was named as a defendant, but he never worked at Flite, she said.
The other defendant is Froilan Agustin Velasquez, who handled sales at Flite after Ortiz and her daughter left. He left last year and now works at Advanced Technologies. Velasquez said he did sign an employee invention and confidentiality agreement, but he denied the other charges.
Flite filed the suit Aug. 6 in U.S. Bankruptcy Court in Orlando, Fla. The suit asks for $2 million in compensatory damages and $5 million in punitive damages.
After the defendants left the company, Anderson said, ``I found out that I had been totally scammed.''
Why did Anderson wait seven years after the breakup to take legal action?
``I just never really had the wherewithal to pursue this. ... We put up with this abuse for years because we really didn't have the money to go after them,'' he said.
But now the bankruptcy court has encouraged him to file suit to resolve his financial problems, he said.
``We were basically told very strongly that we needed to do something, and we did it,'' Anderson said.
Anderson said he recently sold some metalworking machines to New Castle Industries Inc., a screw maker in New Castle, Pa. But he said Flite is rebounding and remains in production.