Pawcatuck sporting goods distributor sues company featured on 'Shark Tank'
Stonington — A Pawcatuck sporting goods distributor has taken legal action against a company that recently obtained a $600,000 investment from businessman Mark Cuban on the popular television show "Shark Tank."
Mark Ferrara, who owns Anthem Sports on Extrusion Drive, has filed a lawsuit in U.S. District Court asking a judge to rule that his line of personal enclosures, which protect spectators at sporting events, do not infringe on those made by Under the Weather of Cincinnati, Ohio, which appeared on "Shark Tank" last month.
In addition, Ferrara is asking the judge to bar Under the Weather, its owner, Eric Pescovitz, and its representatives from taking to social media, including Anthem’s own Facebook page, to criticize Anthem’s pods and calling them “illegal, very poor knockoffs.”
Pescovitz, the owner of Under the Weather, declined to comment on Ferrara’s suit.
Ferrara, who has been in business for 15 years and employs 14 people, said that in the fall of 2014, his wife Carolyn spotted Under the Weather pods at a soccer tournament. He said he then approached Under the Weather about the pods and began selling them in early 2015. He said that at the time, Under the Weather had been selling the pods for several years. After just a few weeks of promoting the pods on its website and social media, Ferrara said he sold 700 in one four-day period and Under the Weather sold 600.
“It was clear our marketing triggered the boost (in sales). They sold a ton of them based on our marketing efforts,” said Ferrara, who has provided documentation showing millions of Facebook views and hundreds of thousands of “likes” and “shares” during certain periods.
The suit states that the UTW pods had gained traction in the marketplace and become commercially successful because of Anthem’s promotion.
The two companies then agreed that Anthem would be the exclusive online distributor of UTW enclosures and UTW requested that Anthem draw up the outline of a partnership.
The suit states that Anthem drew up the outline and also created the successful pitch that landed UTW on Shark Tank. UTW never responded to Anthem’s partnership outline.
While on Shark Tank, Pescovitz told the sharks he sold 22,000 pods in 2016 generating $2 million in revenue and $1 million in profit while spending just $11,000 on advertising. He landed a $600,000 investment from Cuban in exchange for a 15 percent stake in the company. Cuban also asked for an option to purchase 10 percent more of the company for an additional $600,000.
Ferrara said that as UTW’s enclosures became more successful, UTW raised the price for Anthem and limited the number it would provide to Ferrara. The suit states it became no longer feasible for Anthem to sell the pods.
That’s when Ferrara designed his own All Weather Sports Pod and sourced it from a new manufacturer. He began selling them in February. When UTW discovered Anthem’s pods in April, the suit alleges Pescovitz left a voice message for Ferrara, saying he had a patent on the design and Ferrara should expect to be sued.
He then took to Anthem’s Facebook page and on April 11, when one poster said the pods were perfect for fireworks and another said he had seen them on Shark Tank, Pescovitz wrote “this is an illegal, very poor knockoff of what you saw on Shark Tank.”
Ferrara said he took extensive measures to ensure that his design did not infringe on that of UTW. He said the Anthem pods have a number of design improvements and he worked closely with a patent attorney before proceeding with manufacturing and sales.
Anthem has pods in three sizes compared to UTW’s one, they anchor to artificial turf, have detachable mesh sides and clear plastic front doors, and a flat top. Anthem’s pods cost $59 for a single person standing model, $69 for single seated model and $129 for one that accommodates 4-8 people depending on whether they are seated or standing. The costs of UTW’s single pod starts at $99 and features clear plastic sides and front and a variety of color options.
“We put a lot of time and money making sure we did not infringe on anyone’s intellectual property,” Ferrara said. “It’s clear we were not trying to copy his product. We designed our own clear of his intellectual property or anyone else's intellectual property.”
The suit alleges that UTW’s threat to sue and online comments are damaging to Anthem’s business. It asks that a judge declare that Anthem’s manufacturing, sale or importation of its own pods do not infringe on any of UTW’s patents.