Works Electric Complaint

8/10/2019 Works Electric Complaint

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IN THE CIRCUIT COURT FOR THE STATE OF OREGON

FOR THE COUNTY OF MULTNOMAH

WORKS ELECTRIC, LLC, an Oregon limited

liability company, and BRAD BAKER, anindividual,

Plaintiffs,

v.

BOXX CORPORATION, an Oregon corporation,

Defendant.

TO: BOXX CORPORATIONo Registered Agent

Eric Vaughn Meyers

123 NW 12th ,#244Portland, OR 97209

Case No. 14CV09803

SUMMONS

You are hereby required to appear and defend the complaint filed against you in the above entitled action within thirty(30) days from the date o f service o f this summons upon you, and in case of your failure to do so, for want thereof, plaintiff(s)will apply to the court for the relief demanded in the complaint

NOTICE TO THE DEFENDANT: READ THESE PAPERSCAREFULLY

You must "appear" in this case or the other side will winautomatically. To "appear" you must file with the court a legalpaper called a "motion of answer: The "motion" or "answer"must be given to the court clerk or administrator within 30 days,along with the required filing fee. It must be in proper form and

have proof of service on the plaintiffs attorney or, if the plaintiffdoes not have an attorney, proof of service upon the plaintiff.

If you have any questions, you should see an attorneyimmediately. If you need help in finding an attorney, you maycall the Oregon State Bar's Lawyer Referral Service at (503)684-3763 or toll-free in Oregon at (800) 452-7636.

STATE OF OREGON, County of Multnomah) ss.

SIGNATURE OF ATIORNEY/AUTHOR FOR PLAINTIFF

Phil NelsonATIORNEY'S/AUTHOR'S NAME

Slinde Nelson Stanford LLC111 SW 5

Avenue, Suite1740

Portland OR 97204503.417-77771503.417-4250 (facsimile)

Trial Attorney if Other than Above

QSB 013650BARNO.

BARNO.

I, the undersigned attorney of record for the plaintiff, certifY that the foregoing is an exact and complete copy of theoriginal summons in the above-entitled action. {

A TTORNEY OF RECORD FOR PLAINTIFF(S)

TO THE OFFICER OR OTHER PERSON SERVING THE SUMMONS: You are hereby directed to serve a true copy of thissummons, together with a true copy o f the complaint mentioned therein, upon the individual(s) or other legal entity(ies) towhom or which this summons is directed, and to make your proof of service on the reverse hereof or upon a separate similardocument with you shall attach hereto.

Page 1 -SUMMONS

ATTORNEY FOR PLAINTIFF(S)

SLINDE NELSON STANFORDl l SW 5' Avenue, Suit e 1740

Portland, OR 97204503.417-7777

EXHIBIT 1 - Page 1 of 45

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7/25/2014 11:59:57 AM14CV09803

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IN THE CIRCUIT COURT FOR THE STATE OF OREGON

FOR THE COUNTY OF MULTNOMAH

WORKS ELECTRIC, LLC, an Oregonlimited liability company, and BRADBAKER, an individual,

Plaintiffs,

v.

BOXX CORPORATION an Oregoncorporation,

Defendant.

Plaintiffs allege as follows:

Case No.

COMPLAINT

Declaratory Judgment)

Not Subject to Mandatory Arbitration)Jury Trial Requested

Fee Authority: ORS 21.135 1), 2) h)

PARTIES

1.

Works Electric, LLC Works Electric) is an Oregon limited liability company with its

principal place of business in Multnomah County, Oregon. Plain tiff Brad Baker is a resident of

Washington County, Oregon and he owns Works Electric.

2.

Defendant BOXX Corporation BOXX) is an Oregon corporation with its principal place

of business, on information and belief, in Multnomah County, Oregon.

ll

Page 1 - COMPLAINT SLINDE NELSON STANFORD111 SW 5th Avenue Suite 1740

Portland, Oregon 97209p. 503.417.7777; f 503.417.4250


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FACTS

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3 Brad Baker is a mechanical engineer with specialized training in solid modeling,

4 computer numerical control machining and aluminum tungsten inert gas welding. Baker has

5 long history in electric motorcycle building and customization, and Baker has to his credit a

6 substantial list of original works and inventions. In short, in the industry, Baker is known as a

7 forward-thinking and prolific inventor of two-wheel electric motorized vehicles.

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9 In 2010, the founder ofBOXX Eric Vaughn, purportedly conceptualized a new design to

10 the traditional motorized moped. Vaughn approached Baker with little more than a rough sketch

11 of his concept. BOXX engaged Baker, among others, to design and build the new moped

12 product. In exchange for working on the project, Baker was to receive 600 per month and a

13 small equity percentage in BOXX. When it engaged Baker, BOXX knew that Baker worked

14 other jobs and engaged in other work, including creative and inventive work, in the electric

15 motorized vehicle space. The parties memorialized the terms of Baker's engagement in a Service

16 Agreement and a Confidentiality Agreement, both signed March 7, 2010, and his equity award in

17 a Subscription and Shareholders Agreement. The Service Agreement, Confidentiality

18 Agreement and Subscription and Shareholders Agreement are attached to this Complaint as

19 Exhibits A-C.

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21 Baker assisted BOXX in the creation of its motorized moped until the Fall of 2012, even

22 though BOXX had only paid Baker intermittently and had repeatedly breached the parties'

23 Agreement.24 7

25 After the conclusion of the BOXX project, Baker formed Works Electric to continue his

26 work in the electric motorized vehicle industry. Specifically, after the BOXX project concluded,

Page 2 - COMPLAINT SUNDE NELSON STANFORDl l SW 5th Avenue, Suite 1740

Portland, Oregon 97209p 503.417.7777; f 503.417.4250


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1 Baker turned his attention back to invention, working on new concepts or modified versions o

2 his prior inventions. Baker conceptualized the Rover, which was meant to be a small stand-up

3 version o Baker's prior invention, the Neurmancer Motorcycle.

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5 In June 2014, BOXX sent Baker and Works Electric a letter threatening to sue Works

6 Electric in connection with the Rover. BOXX claimed that BOXX coined the term Rover and

7 that the Rover involved substantially the same drivetrain, controllers, electronics, programming,

8 use, target market, cost, business-model and marketing approach. Each o these allegations is

9 false. In fact, the Rover is completely unique and distinct from the BOXX product. They are

10 similar only in the broadest industry sense: they are both electric motorized two-wheel vehicles.

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12 The Rover, which was actually named after the Mars Rover, is a build-to-order, hand-

13 built, low-production machine designed primarily for off-road and private property riding while

14 in a standing, not a seated position. In its standard form, the Rover is not street-legal in any

15 state. The less expensive BOXX product is a street-legal, traditional moped, ridden in the usual

16 seated position with a purportedly unique design.

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18 The drivetrain, control systems, programming and electronic makeup o the Rover and

19 BOXX products are completely dissimilar. The BOXX is a dual-wheel, all-wheel drive system,

20 with motors in the front and rear wheels and a drivetrain that utilizes two control systems. The

21 Rover drivetrain is based on Baker 's Motorcycle Neurmancer. Like the Neurmancer, the Rover

22 operates on a rear-wheel only drive system, a single control, motors housed in the chassis and

23 wheels driven by a belt-drive system.24 11

25 In conceptualizing and developing the Rover system, Works Electric used no Boxx

26 information, let alone confidential or trade secret information, and no BOXX resources in any

Page 3 - COMPLAINT SLINDE NELSON STANFORDl l SW 5th Avenue, Suite 1740

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1 form whatsoever. Works Electric has not solicited or engaged any current or former BOXX

2 employees, contractors or owners.

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4 On June 30, 2014, BOXX, through counsel, sent a letter to Baker and Works Electric,

5 alleging legal claims based on multiple violations of [Baker's] confidentiality and non-

6 disclosure obligations to BOXX, [Baker's] non-compete covenant, and the Oregon Uniform

7 Trade Secrets Act, as well as [Baker's] theft of intellectual property of BOXX. The letter also

8 accused Baker of defamation and Copyright Act violations. The letter concluded with a series of

9 demands and promised a lawsuit against Baker and Works Electric. Based on the June 30, 2014

10 letter, which is attached to this Complaint as Exhibit D, there exists an actual case or controversy

11 between the parties.

12 FIRST CLAIM OR RELIEF

13 Declaratory Judgment)

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15 Plaintiffs reallege all preceding paragraphs.

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17 Plaintiffs are entitled to a declaration as follows:

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a) Plaintiffs have not violated any provision of the United Stated Copyright Act,

Title 17 USC ( Copyright Act ), or in any other way violated BOXX s

b)

c)

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intellectual property rights;

Plaintiffs have not violated the Oregon Uniform Trade Secrets Act, ORS 646.461

et seq ;

Plaintiffs have not violated any contractual obligation to BOXX; and

Plaintiffs have not violated any other statutory or common law duties to BOXX.

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26 Plaintiffs are entitled to attorney fees under the Copyright Act, the Uniform Trade Secrets

Page 4 - COMPLAINT SLIN E NELSON ST NFORDll SW 5th Avenue, Suite 1740

Portland, Oregon 97209p 503.417.7777; f 503.417.4250


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1 Act and/or the terms of the contracts between the parties.

2 WHEREFORE Plaintiffs pray for judgment in their favor, in the form of the declaration

3 requested herein on Plaintiffs First Claim for Relief plus such other legal or equitable relief as

4 the Court deems jus t and proper, including but not limited to all attorney fees and costs incurred

5 to date, and the fees and costs incurred herein.

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DATED this 25th day of July, 2014

Page 5 - COMPLAINT

SUN E NELSON STANFORD

elson, OSB [email protected] A Stanford, OSB No. [email protected]

f ttorneys for Plaintiffs

SUN E NELSON STANFORD

l l SW 5th Avenue, Suite 1740Portland, Oregon 97209

p 503.417.7777; f 503 .417.4250


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s o x x TService greementDated Feb 1 January 2010

BOXX Corp ( Company )

Eric Vaughn Meyers ( EVM )

Brad Baker ( Contractor )


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Service greementBOXX Corp.

(1) PartiesThis agreement ( Agreement ) is between BOXX Corp. (the Company ), BradBaker, referred to as the Contractor , acting as an independent service providerand QQ t as an employee of the Company, and Eric Vaughn Meyers ( EVM ).

(2) AcknowledgementThe Contractor acknowledges that BOXX Corp. has developed the design of theBOXX product invented by EVM (also referred to as Eric Vaughn ), being theFounder, Designer and Owner of the Company, Jl[im: to meeting the Contractor.See Attachment 1 Product 1 Photo Reference: M1 for a description of thepreviously disclosed BOXX product.

(3) Contractor Program Fee:The fee payable to the Contractor by the Company is US [$600.00] per month(the Fee ) during the BOXX prototyping program (the Program ) , with aminimum duration of (6) months. The Fee is payable monthly by check subject tothe completion of program milestones to the satisfaction of the Company in itsdiscretion. In addition to the Fee, the Contractor will also receive stock in thecapital of the Company pursuant to section 4, and subject to the terms, of thisAgreement. The Fee may be deferred at the Company's discretion should aProgram delay require a pause in the services of the title role outlined in section5 of this Agreement. Further compensation for the Program may be paid to the

Contractor by the Company in its absolute discretion.4) Principal Ownership Offer:

A total award of [6%] of the outstanding of the Company (withrights to [6%] of the dividends paid by the Company) will be made to theContractor, subject to the terms of this Agreement. The award will be of Class Astock of the Company. Award letters will be issued at completion of themilestones outlined in this Agreement as determined by the Company in the formof Attachment 2 The actual transfer of stock in the amount outlined in the awardletters will be made on the date of the first dividend paid by the Company, or ifthe Phase 3 milestone outlined herein is not completed by that date, the date thatthe Phase 3 milestone is completed.

The transfer will be made pursuant to a Share Transfer Agreement to be enteredinto between EVM and the Contractor, substantially in the form of Attachment 3The Contractor acknowledges acceptance of the draft terms of the ShareTransfer Agreement and Schedule 1 (Irrevocable Proxy) and Schedule 2(Shareholder's Agreement) thereof. For the avoidance of doubt, the stock will be

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awarded at no additional cost to the Contractor other than the services outlined inthis Agreement.

Award Outline:Phase 1 - (2%) Award upon completion of BOXX Prototyping Program.Phase (2%) Award upon completion of BOXX Manufacturing Program.Phase 3 (2%) Award upon completion of bQ1b 2 years service under thisAgreement and 420 manufactured units.

5) Effective Awarded Company Title Role:Engineering: Powertrain Director

6) Invoices:The Contractor agrees to provide the above mentioned work according to thespecifications provided from time to time by the Company. The Contractor willsubmit its invoices for services when payment is due in accordance with theabove schedule. Unless otherwise stated, payment terms are cash, net five (5)days from the date of invoice. Accounts not paid within thirty (30) days shallaccrue a monthly service charge of (.25%) of the balance past due. If theCompany becomes delinquent in the payment of any amount due hereunder, theContractor reserves the right to suspend performance of services. If theContractor engages an attorney to collect any cash amounts due hereunder, theContractor shall be responsible for such attorney fees.

7) Correspondence_:All correspondence for, during and of the project or program pertaining to theCompany is required to take place within the boxxcorp.com server domain and

all digital materials are to remainon

record. A Contractor email account isprovided for such use and may only be used to represent the Company.

8) Ownership:All work pertaining to the Company as outlined in the Confidentiality Agreementbetween the Company and the Contractor dated [1 February] 2 1 0 is theproperty of the Company.

9) Fair Use:The Contractor shall be entitled to use the Company's name and images ordescriptions of the work performed for the Company (and, where applicable, theCompany's product incorporating such work) in promoting the Contractor.

Permitted uses include that of and limited only to the inclusion of the Contractor'spersonal representations of the work that is performed and known by perviousrelease of the Company at its discretion as public information performed by theContractor.

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1 0) Limitation of Professional Liability:The Company shall be responsible for any product in which the Contractor s workor recommendations are incorporated and agrees to indemnify and hold theContractor harmless from any and all liabilities, demands, claims, suits, fines,

cost of defense, including attorney s fees, or for any other loss, expense ordamage arising from any claim for injury or infringement relating to theCompany s product and services. In exchange the Contractor agrees that, beinga part principal owner of the Company, he will not commence or maintain any suitagainst the Company whether at law or in equity at any time.

11) Governing Law:This agreement shall be governed by the laws of the United States of America,State of Oregon, or any international country at the selection of the Companywhere it may maintain its conduct exclusively or primarily.

12) Authorization:Authorization to begin work constitutes acceptance of these terms andconditions. At the Contractor s option it may delay commencement of the workuntil it receives written authorization from the Company to proceed with work onthe program.

(13) Acceptance:The above conditions meet with your approval and this letter serves as acontract.Date: 3/ Zal o 1 20JQ_.

(Signature) _ __.c f J.,.- 0 7 2 0 1Address: _ _

(Acknowre by)Eric Vaughn Meyers

(Acknowledged by)BOXXCORP.

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Documents

Works Electric Complaint