Commercial

In Trial: AudienceArc (form. SocialArc) vs. Spark Public Relations

SAN FRANCISCO, CA – In The Hon. Richard Ulmer’s courtroom right now is a case brought by a Berkeley company against a San Francisco PR firm following an acquisition gone bad.

According to the complaint, AudienceArc says it provided services to Spark for which a balance was owing when AudienceArc agreed to sell assets to Spark, and that amount remains due. Separately, AudienceArc alleges that there was a promissory note executed as part of the acquisition, and the balance on the note was to be offset by the balance owing for services.

There are a couple interesting things about the complaint. First, the amounts referenced are not huge, suggesting this might be a case that has taken on a life of its own because the underlying agreement(s) provide(s) for the recovery of attorney’s fees. Attorney’s fees provisions are often a double-edged sword. They can prevent frivolous lawsuits while at the same time act as an incentive to, and fuel, litigation where each side believes they are in the right.

The second point to note is, the complaint suggests that the services agreement required AudienceArc provide estimates in advance of performing work, which AudienceArc seems to admit it did not do. If you are a service provider and the contract that you are using requires that you do something as a precondition to getting paid, you’d better do it. Best not to include such prerequisites in the first place.

This blog reports on cases filed in and around the San Francisco Bay Area. The statements made are based on the allegations in court-filed documents. Allegations are just accusations, and may or may not be true.
The authors of the blog are attorneys at the San Francisco litigation firm, Wood Robbins, LLP. If you have a legal issue, send them an email. If they cannot help you, they will try and point you in the right direction.
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