Felt Manufacturing Drops Trade Theft Suit
By Patrick Cronin
Hampton Union, Tuesday, July 11, 2006
[The following article is courtesy of the Hampton Union and Seacoast Online.]
HAMPTON -- A lawsuit filed by the bankrupt Foss Manufacturing Co. against a former employee alleging he stole confidential information to benefit his new employer has been dismissed.
Bankruptcy Judge Michael Deasy dismissed the suit against Steven Eisendrath, who worked in the company's Decorative Products Division until the beginning of January and his new employer Rontex America.
Patrick O'Malley, the trustee who was overseeing the Foss Manufacturing during bankruptcy proceedings, filed the suit in January. But since then, the company has been sold and renamed Felt Manufacturing.
Deasy gave the new owners of Felt Manufacturing until the end of June to substitute O'Malley's name with its own to continue the civil suit but the company failed to do so. Since there was no motion filed by the new owners, Deasy dismissed the case last week without prejudice for lack of prosecution.
According to court documents, O'Malley accused Eisendrath of working with Rontex while he was a Foss employee to steal a contract Foss had with Truck Accessories Group.
Foss, which manufactures non-woven fabrics and synthetic fibers, provided Truck with Fossliner as the interior liner for the truck caps the company sells.
Foss Manufacturing claimed Eisendrath was negotiating with Truck Accessories Group to renew its annual contract with the company before he resigned from Foss.
On the day he resigned from Foss, Eisendrath allegedly sent out an e-mail to Truck Accessories to persuade the company to give the contract to Rontex, which never competed in the truck cap market before.
Losing the contract cost Foss roughly $857,000 in annual sales.
Eisendrath was also accused of copying the company's trade secrets that were on computer files he allegedly used to underbid Foss and get the contract for Rontex.
Both Eisendrath and Rontex denied any wrongdoing in court filings.