$476,500 Recovery for Local Company Cheated Out of Sales Commissions
An East Coast company hired our client, a local corporation, to act as its sales force and target Fortune 500 companies. The contract entitled our client to receive commissions on all deals in which it had any involvement. (This favorable term was negotiated after the East Coast Company refused to give any equity in it.) After our client started generating leads, the East Coast company began repudiating agreements about which target accounts could be pursued. It also cancelled the contract, interfered with our client’s ability to close deals, and concealed the closing of several deals our client had worked on.
Our client tried to resolve these issues informally. It failed. They then retained Jeffrey Cowan and The Cowan Law Firm.
We invoked the arbitration clause in the parties’ contract. The East Coast company responded by proposing that the companies mediate in the interests of minimizing legal fees. We were amenable – until the East Coast company refused to provide any information about what deals had closed and the revenues they had generated (a requirement to avoid negotiating “in the dark”).
We renewed our demand to arbitrate. The East Coast company ignored us. Because the contract specified that the winning party in any lawsuit could not recover its legal fees if it violated its contractual duty to arbitrate, we filed a “petition to arbitrate” lawsuit in the Los Angeles Superior Court. The East Coast company opposed the lawsuit. A judge rejected its arguments and ordered arbitration. The East Coast company then voluntarily paid our client’s legal fees incurred to that point without the need for more motion practice.
The East Coast company then again proposed mediation. This time, however, it agreed to provide financial information. We mediated twice with retired Superior Court Judge Eric Younger over an 8 month period – with the second session involving hundreds of pages of documents and independent witnesses. As a result, the East Coast company agreed to pay $476,500 to settle our client’s claims.
The Cowan Law Firm
Phone: (310) 394-
Fax: (310) 394-
2049 Century Park East
Los Angeles, California
2425 Olympic Blvd, Suite 4000 W
Santa Monica, CA 90404
Call (310) 394-
2049 Century Park East, Suite 3850
Los Angeles, California 90067
Employment Attorney • Business Trial Lawyer