Robert Parker sues Antonio Galloni for Fraud, Breach of Contract

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Robert Parker Robert Parker sues Antonio Galloni for Fraud, Breach of Contract

The Wine Advocate filed a lawsuit against their former wine reviewer Antonio Galloni today! Galloni previously wrote wine reviews for Robert Parker and The Wine Advocate, covering California, Italy, Burgundy and Champagne. CIVIL ACTION NO. 1:13-cv-827 The action is for “Fraud, Breach of Contractual Obligations and the intentional and unjustifiable withholding of tasting notes and articles.”

This is shocking news to many wine lovers. Websites all over the Internet have been buzzing over the past few weeks that a lawsuit was inevitable after Robert Parker took on investors from Singapore for the Wine Advocate and Antonio Galloni resigned. Shortly after the abrupt departure of Antonio Galloni, Robert Parker stated he would return to writing about, and rating California wine again, much to the pleasure of his enthusiastic, subscribers. On March 19, The Wine Advocate announced it had added 3 new, reviewers to their team, adding they would announce the identity of one new critic, April 2. The others would be named shortly after thereafter. Robert Parker is currently in Bordeaux at the moment, tasting the 2012 Bordeaux vintage. Parker is also going to taste the 2003 Bordeaux vintage during the same trip.

Prior to the sale of The Wine Advocate, speculation was rampant that Antonio Galloni would eventually take over the publication. The conventional wisdom was Antonio Galloni, who has a background in finance would potentially purchase the influential journal The Wine Advocate, from Robert Parker. When that was no longer an option, with very little notice, Galloni informed Robert Parker and the new owners stating, he was no longer interested in working as an independent contractor for the company.

That’s fine. But like most things, that was not all there was to it. The break was not clean. The problem is that prior to the sale of The Wine Advocate, Antonio Galloni, who was being paid $300,000 and expenses per year, contracted to write about and review the wines of Sonoma, California and other regions for Robert Parker and The Wine Advocate. Galloni refused to deliver the work product once he terminated his business relationship with the company. He claimed that he was unable to finish his report on time as it would not do justice to the region. That comment was instantly met with derision by many on the Internet. His efforts to entice new subscribers from The Wine Advocate was understandable, but the manner in which he openly sought them was seen as self-serving. It would appear that the previously popular, Antonio Galloni has squandered much of the goodwill in the wine community he expended so much energy earning over the past several years. You can draw your own conclusions from reading the words written by Antonio Galloni.

On March 5, on his just created website, Antonio Galloni posted the following message…

“I am aware, and appreciative of, the interest in my upcoming Sonoma reviews. I would like to provide you with an update on where things stand. Those of you I have met personally know how much I value transparency, so I apologize if the following is more detail than you care to know.

When I began tasting Sonoma wines earlier this year, I realized my article would be far larger than I had originally anticipated. On January 15, I informed The Wine Advocate’s Editor in Chief, Lisa Perrotti-Brown, I would not be able to write a comprehensive article in time for their February issue that would do full justice to the region and the extraordinary diversity of its wines.

On February 12, I informed Robert Parker I was leaving TWA, and I announced the launch of a new multimedia platform for my reviews. This change was necessary to protect the editorial independence I have always valued from the beginning of my career. Any suggestion that I left TWA for any other reason, including my educational tastings and seminars, is false. I brought educational tastings and seminars to TWA with Bob’s full endorsement and had the support of TWA’s new owners to continue doing the same. Not surprisingly, when Bob wanted to host a gala charity lunch this past October he turned to my company for our expertise.

Robert Parker’s posting on Mark Squires’ Bulletin Board on February 14 that Sonoma reviews had been scheduled for the February issue is also false. In fact, Sonoma has never appeared on TWA’s 2013 Editorial Calendar. I have only recently begun to write the article and I still have quite a few wines to taste.

It has never been my desire to intentionally withhold the Sonoma article. Out of my deep respect for Bob, our joint readers, and in the spirit of collaboration, on February 15 I offered to make the Sonoma reviews available to TWA readers for free, on my new platform, once the article had been written and posted. TWA declined.

I am now working to taste the wines that remain and to write the tasting notes. Once the Sonoma article is finished, it will be posted on my new site, where it will be available for free to the public. I expect the Sonoma reviews will be published early next month. I regret that I was not able to write this article earlier, but I hope the breadth of coverage will compensate to some extent.”

That article created a firestorm of comments all over the Internet. Interestingly, some of the comments highly critical of the actions of Galloni were written by posters that more often than not, spend their time looking for an excuse to slam Robert Parker. They found his contentions to lack credibility. Of course that is not universal. Other posters were positive the actions taken by Galloni were proper and justified.

The situation rapidly heated up today when The Wine Advocate filed a lawsuit against Antonio Galloni! On his website, posting from Bordeaux, where he is currently tasting the 2012 Bordeaux vintage, Robert Parker wrote:

“Dear readers – during the last 30+ years, our commitment has been to provide consistent, thorough reviews of the regions you value most. Our highly anticipated reports are released the same time every year. With Antonio’s sudden departure there has been a delay in getting you the Sonoma report, and that’s not the experience we want you to have.

We’re sorry to have to bring this conversation to you and had hoped to let the legal process take its course; we have taken appropriate action to retrieve the report Antonio was paid to produce. It’s a disservice to you and to the vintner associations and winemakers who put in massive efforts coordinating tastings for this report in hopes of getting a Wine Advocate review. At the time of these tastings, Antonio was a reviewer for The Wine Advocate, so it stands to reason the report he was paid to provide should be submitted. We regret having any delay and appreciate your patience as we sort through details via the proper channels.

Our actions are simply a matter of retrieving a service we paid for on your behalf. This is not an attempt to stop Antonio from moving on; we continue to wish him our very best.”

More news to follow…

For fans of courtroom drama, or interested parties, this is a copy of the lawsuit brought by Robert Parker and The Wine Advocate against Antonio Galloni.

NATURE OF THE ACTION

1. This is an action arising out of, inter alia, Defendants’ fraud and breach of their contractual obligations and their intentional and unjustifiable withholding of tasting notes and articles created while engaged and paid by Plaintiff and based upon tastings which Defendants undertook while representing to wineries that they were visiting on Plaintiff’s behalf. To the contrary, however, and unbeknownst to Plaintiff, Defendants traveled to wineries, at Plaintiff’s expense, only with the intention of creating tasting notes and articles for their own use. As a result of Defendants’ actions, Plaintiff has suffered damages and irreparable harm, including loss of subscribers.

2. Defendants’ fraud is based upon their secret scheme to travel to wineries throughout the world, at Plaintiff’s expense and using Plaintiff’s reputation, when in fact, they intended to use these visits solely for their own benefit.

3. At least as early as December 2012, Defendants utilized Plaintiff’s personnel and goodwill to deceive wineries into believing that they were representing Plaintiff when they attended tastings of wines from the regions of Sonoma, Brunello, Barolo, and Burgundy.

4. Unbeknownst to Plaintiff, instead of fulfilling their contractual obligations, Defendants fraudulently visited wineries so that they could reap the benefits of the articles and tasting notes that derived from the winery visits.

5. After repeatedly ignoring Plaintiff’s request for certain of the articles and tasting notes that Defendants regularly provided, and were owed, to Plaintiff, Defendants’ fraud was revealed when they informed Plaintiff they were no longer working for Plaintiff and would be retaining the aforementioned articles and tasting notes for their own benefit.

6. Defendants fraudulent and deceptive conduct not only damaged Plaintiff’s reputation, of being a highly-regarded publication, to its current and prospective subscribers, but it also damaged its relations with wineries in that Defendants’ fraud utilized Plaintiff’s personnel and goodwill and, thus, unjustifiably and wrongly imputed a lack of integrity onto Plaintiff and tarnished its image.

7. As a result of Defendants’ actions, Plaintiff has lost, and will continue to lose subscribers to its publications for, among others, two main reasons: a. First, Plaintiff has not received from Defendants the highly-anticipated tasting notes and articles regarding wines that subscribers expect to be in The Wine Advocate. The absence of certain scheduled tasting notes and articles has resulted, and will continue to result, in lost subscribers. b. Second, as a result of Defendants’ improper use of Plaintiff’s confidential subscriber information, Defendants have been raiding Plaintiff’s subscribers and directing them away from Plaintiff’s publication and toward Defendants’ website.

FACTUAL BACKGROUND

Plaintiff’s The Wine Advocate Publication

8. Plaintiff is the publisher of the world-renowned, subscription-only, bi-monthly journal entitled The Wine Advocate, wherein wines from around the world are rated and reviewed. Plaintiff also operates a website on which an electric version of The Wine Advocate is published.

9. The Wine Advocate is a highly-regarded publication in which wines from all over the world seek to be reviewed. The Wine Advocate is considered the preeminent publication for wine review and has obtained unparalleled success in the wine-review industry.

10. Subscribers are attracted to The Wine Advocate for its integrity and independence and would not subscribe to Plaintiff’s publications but for its well-respected and highly anticipated tasting notes and articles of wines from all over the world.

11. Reviews of wines by Plaintiff are vigorously sought by wineries and enhance its reputation and are highly anticipated by Plaintiff’s subscribers and are subject to known and specific Case.

Timely publication of the tasting notes and articles is essential to the success of Plaintiff’s publications and business.

12. Due to its reputation, wineries strive to be reviewed and rated by The Wine Advocate.

Plaintiff’s Independent Contractors

13. The Wine Advocate publishes reviews written by a team of reviewers led by Robert M. Parker, Jr., Plaintiff’s President. In addition to Mr. Parker, Plaintiff engages independent contractors to appear at wineries all over the world on its behalf. Plaintiff often arranges for visits by its independent contractors, and compensates the independent contractors and pays for their travel and lodging expenses. 14. After the independent contractor visits a winery, the independent contractor drafts “tasting notes,” which contain the analysis of a wine’s characteristics and uses Plaintiff’s proprietary grading scale to rate the wine. Independent contractors also draft articles about the wines.

15. Defendants entered into Agreements with Plaintiff to be independent contractors to write tasting notes and articles on the wines they tasted.

16. At all relevant times hereto, an Agreement was in place between Defendants and Plaintiff
which governed their relationship.

17. On or about November 20, 2006, Plaintiff and Galloni entered an Independent Contractor
Agreement (“2006 Agreement”) whereby Galloni was retained to, inter alia, monitor and review wines
in specified regions throughout the world. The 2006 Agreement provided for a term of four-years, with
an extension of up to two years. A true and correct copy of the 2006 Agreement is attached hereto as
Exhibit “A.”

18. In 2010, Plaintiff and Galloni entered into a new agreement which was intended to replace the 2006 Agreement and which changed Galloni’s compensation.

19. Upon information and belief, Galloni executed the 2010 Agreement as he advised Plaintiff that he submitted such Agreement to a bank to secure a mortgage. Notwithstanding any other Agreement between the parties, the 2010 Agreement was applicable between 2010 and 2012, with a possible extension of up to 2014.

20. In 2011, Galloni requested that Amendment No. 1 (the “2011 Amendment”) be drafted wherein, among other things, Galloni’s compensation was again increased. The 2011 Amendment referenced the 2006 Agreement and provided that other than what was specifically amended, the 2006 Agreement remained in effect. A true and correct copy of the 2011 Amendment is attached hereto as Exhibit “C.”

21. In 2012, Galloni again requested a new Agreement (“2012 Agreement”) be drafted wherein All Grapes Media was named as the independent contractor. The 2012 Agreement provided for a three-year term, with an extension of up to two years. A true and correct copy of the 2012 Agreement is attached hereto as Exhibit “D.”

22. While Plaintiff does not possess a signed copy of the 2012 Agreement, Defendants have informed Plaintiff the 2012 Agreement was signed, and the parties’ actions indicated that the 2012 Agreement was signed and duly executed because both parties acted as if the 2012 Agreement was binding. For example, the 2012 Agreement named All Grapes Media as the independent contractor, which was the entity paid by Plaintiff. Additionally, Defendants continued to provide Plaintiff with wine articles and continued to use Plaintiff’s website, as if an Agreement was in place.

23. Moreover, in the alternative, if neither the 2010 Agreement nor 2012 Agreement was in place, the 2006 Agreement is applicable because the course of conduct between the parties demonstrates that the terms of the 2006 Agreement, with the exception of the named-independent contractor and compensation, were extended and were binding between the parties at all times relevant hereto.

24. Because the material terms, as relevant to this litigation, in the 2006 Agreement, 2010 Agreement, 2011 Amendment, and 2012 Agreement are the same, the term “Agreements,” as used herein, means the 2006 Agreement, 2010 Agreement, 2011 Amendment, and 2012 Agreement collectively or individually.

THE PARTIES

25. Plaintiff, The Wine Advocate, Inc., is a Maryland corporation with its principal place of business in Maryland. Plaintiff is a subsidiary of Wine Ad PTE. Ltd., a corporation existing under the laws of the Republic of Singapore with its principal place of business in Singapore.

26. Galloni is an adult individual who, upon information and belief, is a citizen of the State of New York and resides at 25 Sheridan Road, Scarsdale, NY 10583.

27. Upon information and belief, Defendant All Grapes Media is a Delaware limited liability
company, and its sole member is Galloni.

Venue – 28 – 37

GENERAL ALLEGATIONS

Defendants’ Contractual Obligations and Compensation

38. The Agreements required Defendants to write articles, into which their tasting notes were incorporated, on the wines they reviewed for Plaintiff for publication in both written and electronic form.

39. Galloni was permitted to use Plaintiff’s widely-recognized, proprietary 50-100 point grading scale solely for the articles and tasting notes he drafted for Plaintiff.

40. The articles and tasting notes were to be provided to Plaintiff “on a timely basis in accordance with directions from [Plaintiff] and to ensure sufficient time for editing and to meet publication schedules.”

41. Defendants were compensated for the services they provided pursuant to the Agreements.

42. The 2006 Agreement provided that Galloni be compensated $12,500 per year and an additional one-time payment of $15,000.

43. The 2010 Agreement changed Galloni’s compensation to $100,000 per year, in four (4) payments of $25,000 each payment. Plaintiff made all payments due to Galloni and all payments were cashed.

44. The 2011 Amendment changed Galloni’s compensation to $300,000 per year.

45. The 2012 Agreement provided for compensation to All Grapes Media of $300,000 per year, payable in monthly payments of $25,000, and added an additional $5,840 per month to cover clerical and administrative costs and expenses incurred by All Grapes Media. Plaintiff made all payments due to All Grapes Media and all payments were cashed.

46. The Agreements also provided that Plaintiff would reimburse Defendants for their travel and lodging expenses incurred by them in connection with the preparation of the tasting notes and articles that they were creating for Plaintiff.

47. Defendants were last paid for their services on January 28, 2013. Because independent contractors were paid a month in advance, this payment applies to Defendants’ services through February 28, 2013.

48. Defendants submitted their expenses for trips to wineries as late as November 30, 2012
and have been reimbursed as required by the Agreements.

Plaintiff Was Granted Exclusivity on All Tasting Notes and Articles

49. Under the expressed terms of the Agreements, Plaintiff was granted an exclusive right to publish all articles, tasting notes, and other written submissions made pursuant to the Agreements.

50. The period of exclusivity lasted for twelve (12) months from the time Defendants submitted the article, tasting note, or other written submission to Plaintiff.

51. In the event that Plaintiff published the aforementioned article, tasting note, or other written submission, the exclusivity period expired after sixty (60) days of publication of the same.

52. Only after the exclusivity period expired could Defendants utilize the article, tasting note, or other written submission for their own benefit.

Defendants Were Bound By a Confidentiality Provision

53. As part of the Agreements, Defendants expressly acknowledged that they had access to secret, confidential, and proprietary information which was invaluable to the operation of Plaintiff’s business.

54. Defendants agreed that during the times they were independent contractors, and “for all periods thereafter,” Defendants would not use Plaintiff’s confidential, secret, or proprietary information for their own benefit.

55. Included in Plaintiff’s confidential, secret, and proprietary information were customers’ (subscribers’) names and addresses and other “data on or relating to past, present or prospective
customers.”

56. Defendants agreed that while they were independent contractors, and for twelve (12) months thereafter, they would not “approach or solicit for business or divert from [Plaintiff] any business with or otherwise interfere with any of [Plaintiff’s] relationships with any of its customers, suppliers or vendors.”

57. Defendants breached the confidentiality provision by using Plaintiff’s confidential subscriber information to solicit Plaintiff’s subscribers.

Defendants Refusal to Produce Tasting Notes

58. While they were independent contractors, Defendants were paid by Plaintiff to visit a number of wineries on behalf of Plaintiff to review wines for inclusion into The Wine Advocate.

59. Included in those reviews were wines from the regions of Sonoma, Brunello, Barolo and Burgundy.

60. While conducting the reviews, Defendants represented to the wineries that they were there on behalf of Plaintiff.

61. A press release was issued in November 2012 stating that Galloni would be appearing at Sonoma on behalf of Plaintiff in January 2013.

62. In November and December 2012, while being paid by Plaintiff and utilizing Plaintiff’s resources, Galloni communicated with Plaintiff and wineries that he would be attending Sonoma in January 2013, on behalf of the Wine Advocate.

63. In January 2013, Galloni did, in fact, visit the Sonoma regions for the purposes of tasting and reviewing wines and had informed Plaintiff’s subscribers he was to provide the Sonoma tasting notes and article in February 2013 for Plaintiff.

64. Also in November 2012, Defendants submitted their expenses for a trip to Burgundy which occurred that same month.

65. Upon information and belief, Defendants also submitted their expenses for their trips to Barolo and Brunello. Defendants’ expenses were paid and Defendants cashed all such expense checks. 66. Additionally, Defendants were paid their salary for the periods during which they visited these wineries.

67. Rather than providing Plaintiff with articles and tasting notes for the wineries they visited on Plaintiff’s behalf and at Plaintiff’s expense, however, Defendants withheld the articles and tasting notes for their own use.

Defendants Terminate Their Agreement with Plaintiff

68. In November and December 2012, Galloni regularly communicated with Plaintiff and the wineries regarding his trips to the wineries for the purpose of tasting and reviewing wine. In all such communications, Defendants, both directly and indirectly, communicated their intent on traveling to the wineries and conducting the tasting and reviews, for Plaintiff.

69. During this time, Galloni gave no indication that he was planning to leave Plaintiff. To the contrary, he continued to schedule trips, utilizing Plaintiff’s resources, through January 2013.

70. During this time, based upon Defendants representations and actions and the unambiguous terms and conditions of the Agreements, Plaintiff believed that Galloni was fulfilling his contractual obligations and would provide the tasting notes and articles to Plaintiff in a timely manner.

71. Starting in February 2013, however, Galloni’s contact with Plaintiff became substantially less and Defendants ultimately stopped responding to Plaintiff’s emails.

72. On or about February 12, 2013, when asked when Plaintiff could expect to receive one of the wine articles to which it was entitled, Galloni responded that he was leaving Plaintiff.

73. That same day, an article appeared in the New York Times announcing his departure, wherein he explained he intended to operate his own wine-review website.

74. In the article, Galloni stated that the sale of a substantial portion of Plaintiff to a Singapore investor in December 2012 made “clear” that the independence and quality of Plaintiff’s business was going to change and played a role in his decision to leave Plaintiff. Galloni’s comment that the independence and quality of Plaintiff’s publication would change was a direct attack at Plaintiff’s well-regarded reputation in the wine-review industry.

75. In the same article, however, Galloni explained that his plans to start his own company began to crystalize in June 2012, well before the sale.

76. Upon leaving Plaintiff, Galloni stated, for the first time, he would not be providing the Sonoma article or tasting notes, which were being requested by Plaintiff’s subscribers, to Plaintiff, but would make them available on his own website to Plaintiff’s subscribers. It is believed Defendants also would not provide the Brunello, Barolo, and Burgundy articles and tasting notes to Plaintiff.

(BREACH OF CONTRACT – PROVISION OF TASTING NOTES AND ARTICLES)

77. Plaintiff hereby incorporates by reference each and every allegation set forth above and below as though fully set forth herein at length.

78. A valid and binding agreement was in place due to the agreed-upon terms of the 2010 Agreement or 2012 Agreement or because the course of conduct between the parties indicated that the 2006 Agreement or 2012 Agreement, and all material terms, except for the named-independent contractor and compensation in the 2006 Agreement, therein, were in place.

79. The Agreements required Defendants to provide the tasting notes and articles created for Plaintiff to Plaintiff for publication in written and electronic format. Subscribers understood that the Sonoma tasting notes and articles were to be published in February 2013.

80. Plaintiff complied with all terms of the Agreements.

81. Defendants breached the expressed terms of the Agreements by failing to provide the tasting notes and articles for Sonoma, Brunello, Barolo, and Burgundy wines, which Defendants tasted on Plaintiff’s behalf and at Plaintiff’s expense.

82. By reason of Defendants’ breach and failure to provide the tasting notes and articles, Plaintiff has suffered damages.

WHEREFORE, Plaintiff, The Wine Advocate, Inc., hereby demands specific performance of Defendants’ obligations under the Agreements that they provide Plaintiff with the articles and tasting notes relating to the wineries visited on Plaintiff’s behalf, and such other and further relief as this Court
deems just and proper.

CONTRACT – CONFIDENTIALITY PROVISION)

83. Plaintiff hereby incorporates by reference each and every allegation set forth above and below as though fully set forth herein at length.

84. The Agreements contain a valid and binding confidentiality provision.

85. The confidential information to which Defendants were exposed included subscriber information which Plaintiff collected for use in its own business.

86. Defendants breached the confidentiality provision by using Plaintiff’s subscribers’ email addresses to promote and/or direct Plaintiff’s subscribers to Galloni’s wine-review website.

87. Defendants’ use of this information went beyond the allowable use provided for in the Agreements, and thus constituted a breach.

88. By reason of Defendants’ breach of the confidentiality provision, Plaintiff has sustained substantial damages.

WHEREFORE, Plaintiff, The Wine Advocate, Inc., hereby demands judgment against Defendants, in an amount in excess of $75,000, together with interest and costs of this action, and such other and further relief as this Court deems just and proper. In addition, Plaintiff seeks injunctive relief to further prevent Defendants’ improper use of its confidential information.

COUNT III

(INTENTIONAL INTERFERENCE WITH ECONOMIC RELATIONS)

89. Plaintiff hereby incorporates by reference each and every allegation set forth above and below as though fully set forth herein at length.

90. Plaintiff’s business is based upon customers subscribing to its publications.

91. Subscribers are attracted to Plaintiff’s publication because of its highly-regarded, worldrenowned review of wines.

92. Defendants have knowledge that Plaintiff’s business depends upon customers subscribing to Plaintiff’s publications and the timely publication of highly anticipated reviews.

93. Defendants have committed intentional and willful acts by withholding tasting notes and articles, which should have been submitted to Plaintiff for publication.

94. Withholding the tasting notes and articles is calculated to cause damage to Plaintiff’s business because wineries and subscribers expect Plaintiff to publish tasting notes and articles relating to specific wines in a timely manner.

95. Defendants withheld tasting notes and articles, for which they were paid, without right or justification and, upon information and belief, retained them for their own use.

96. Defendants intended to withhold the tasting notes and articles for the purpose of causing detriment to Plaintiff and benefitting Defendants.

97. Actual damage has resulted from Defendants’ acts because Plaintiff has lost subscribers as a result of certain tasting notes and articles not being published.

WHEREFORE, Plaintiff, The Wine Advocate, Inc., hereby demands judgment against Defendants, in an amount in excess of $75,000, together with interest and costs of this action, and such and other further relief as this Court deems just and proper.

COUNT IV

(TORTIOUS INTERFERENCE WITH PROSPECTIVE ADVANTAGE)

98. Plaintiff hereby incorporates by reference each and every allegation set forth above and below as though fully set forth herein at length.

99. Plaintiff has a reasonable expectation of business relations with its prospective subscribers.

100. Defendants intentionally, wrongfully, tortiously and, without privilege, acted to interfere with such relationships by withholding tasting notes and articles which Plaintiff’s prospective subscribers expect to be in issues of The Wine Advocate.

101. Plaintiff’s reputation and quality of reviews are essential to the success it has earned as a highly-regarded publication.

102. The integrity and quality of Plaintiff’s business depends, inter alia, on the timely publication of tasting notes and articles.

103. By not publishing the highly-anticipated tasting notes and articles, individuals are less likely to become subscribers to Plaintiff’s publications.

104. Defendants intended to withhold the tasting notes and articles for the purpose of causing detriment to Plaintiff and benefitting Defendants in the form of losing subscribers.

105. As a direct, intended, and proximate result of Defendants’ actions, Plaintiff reasonably expects to face difficulties in adding new subscribers to its publications.

WHEREFORE, Plaintiff, The Wine Advocate, Inc., hereby demands judgment against Defendants, in an amount in excess of $75,000, together with interest and costs of this action, and such other and further relief as this Court deems just and proper.

COUNT V

(MISAPPROPRIATION OF CONFIDENTIAL INFORMATION)

106. Plaintiff hereby incorporates by reference each and every allegation set forth above and below as though fully set forth herein at length.

107. During the time which Defendants were independent contractors for Plaintiff, they had access to confidential and proprietary information including, inter alia, names, email addresses, and other data relating to subscribers to Plaintiff’s publications.

108. Defendants had a duty to maintain such confidential and proprietary information in confidence and to use it only for the limited purpose of benefitting Plaintiff, as set forth in the Agreements.

109. Defendants had a duty not to use Plaintiff’s confidential and proprietary information for their own benefit.

110. Among other things, Defendants improperly used Plaintiff’s confidential and proprietary subscriber information to solicit subscribers for their own website.

111. Upon information and belief, Plaintiff expects that Defendants will also use the proprietary 50-100 point grading scale in their new business.

112. As a result, Defendants improperly acquired Plaintiff’s trade secrets in violation of Maryland’s Uniform Trade Secrets Act, Md. Code, Comm. Law, § 11-1201, et seq
.
113. Defendants’ use of Plaintiff’s confidential information and trade secrets have caused monetary damages and will continue to cause Plaintiff irreparable harm for which no adequate remedy at law exists.

WHEREFORE, Plaintiff, The Wine Advocate, Inc., hereby demands judgment against Defendants in the form of injunctive relief to prohibit the further use of Plaintiff’s confidential information.

114. Plaintiff hereby incorporates by reference each and every allegation set forth above and below as though fully set forth herein at length.

115. Under the expressed terms of the Agreements, Plaintiff was entitled to tasting notes and articles from Sonoma, Brunello, Barolo, and Burgundy.

116. Plaintiff had an interest in the aforementioned tasting notes and articles in the form of an exclusive right to publish the same.

117. Inconsistent with Plaintiff’s exclusive right to the aforementioned tasting notes and articles, Defendants unjustifiably withheld the same from Plaintiff.

118. Defendants continue to deprive Plaintiff of its property by withholding the aforementioned tasting notes and articles.

119. Additionally, Plaintiff owns the confidential information relating to its subscribers.

120. Defendants have deprived Plaintiff, to Plaintiff’s detriment, of its property in the form of this confidential information because Defendants have been using it to solicit Plaintiff’s subscribers. WHEREFORE, Plaintiff, The Wine Advocate, Inc., hereby demands judgment against.

Defendants, in an amount in excess of $75,000, together with interest and costs of this action, and such other and further relief as this Court deems just and proper.

COUNT VII

(FRAUD)

121. Plaintiff hereby incorporates by reference each and every allegation set forth above and below as though fully set forth herein at length.

122. In November and December 2012, Defendants utilized Plaintiff’s resources and good will to attend wineries.

123. Defendants represented to Plaintiff and wineries that they were attending wine tastings on Plaintiff’s behalf and for publication into The Wine Advocate.

124. Defendants submitted their expenses in connection with said visits to Plaintiff, which Plaintiff paid.

125. Rather than attending the wineries on Plaintiff’s behalf, as Defendants represented, Defendants were secretly attending the wineries on their own benefit and to the detriment of Plaintiff.

126. Specifically, in January 2013, Galloni attended wine tastings at Sonoma and informed the wineries that he was attending on Plaintiff’s behalf.

127. Additionally, Defendants attended Brunello, Barolo, and Burgundy wineries and represented that he was there on Plaintiff’s behalf.

128. Unknown to Plaintiff, however, was that Defendants had plans to start a competing website, as stated in the February 12, 2013 New York Times article.

129. Plaintiff reasonably relied to its detriment on Defendants’ representations that they were acting on Plaintiff’s behalf when Plaintiff continued to pay them for their services and reimbursed them for expenses.

130. Plaintiff also reasonably relied to its detriment on Defendants’ representations that they were acting on Plaintiff’s behalf when they allowed Defendants to utilize its name and personnel to communicate with, and schedule trips to, various wineries.

131. Defendants never intended to provide any of the articles or tasting notes to Plaintiff, however.

132. On January 21, 2013, Galloni was asked when the Sonoma article would be prepared because it was highly anticipated by Plaintiff’s subscribers.

133. In response to the inquiry, Galloni responded that he would not have the article ready for the February issue of The Wine Advocate because he was catching up from 2012 articles.

134. In actuality, however, this was a lie because Galloni had no intention of providing the Sonoma article to Plaintiff, despite being under a contractual obligation to do so.

135. Galloni’s deception and fraud became clear when, on February 15, 2013, Galloni stated he would not be providing the Sonoma report and would be using it for his own website.

136. Similarly, Defendants withheld articles and tasting notes for the Brunello, Barolo, and Burgundy wineries, at which they fraudulently appeared on Plaintiff’s behalf.

137. Thus, Defendants engaged in fraud when they led Plaintiff to believe they were attending wineries on Plaintiff’s behalf when, in fact, they intended to retain the tasting notes for their own use.

138. Defendants’ fraud is further enhanced by that committed against the wineries in causing them to believe Defendants were there on Plaintiff’s behalf. This fraud on the wineries directly results in injury to Plaintiff’s reputation in the wine industry.

139. As a direct result of their fraud, Plaintiff suffered harm.

WHEREFORE, Plaintiff, The Wine Advocate, Inc., hereby demands judgment against Defendants, in an amount in excess of $75,000, together with interest and costs of this action, and suchother and further relief as this Court deems just and proper.

COUNT VIII

(INJUNCTION)

140. Plaintiff hereby incorporates by reference each and every allegation set forth above and below as though fully set forth herein at length.

141. Plaintiff is likely to succeed on the merits of its claims.

142. The Agreements provide that Defendants must submit tasting notes and articles relating the wineries visited on Plaintiff’s behalf to Plaintiff so that they can be published in The Wine Advocate. 143. Plaintiff is the publisher of a highly-regarded wine-review publication built upon its reputation and quality reviews which are subject to known and specific schedules.

144. Defendants have withheld tasting notes and articles to which Plaintiff is entitled pursuant to the expressed terms of the Agreement.

145. Failing to provide tasting notes and articles to Plaintiff would result in irreparable harm because Plaintiff’s reputation would be damaged and has resulted, and will continue to result, in lost subscribers.

146. Moreover, Defendants have explicitly stated they will publish articles and/or tasting notes with respect to the wines reviewed from the Sonoma region on their own website.

147. It is further believed that Defendants will also publish articles and/or tasting notes with respect to the wines reviewed from the Brunello, Barolo, and Burgundy regions.

148. Publishing the aforementioned articles and/or tasting notes is in direct violation of the Agreements.

149. Publishing the aforementioned articles and/or tasting notes in violation of the Agreements’ exclusivity provisions would cause Plaintiff to suffer irreparable harm because Plaintiff has already lost, and will continue to lose, subscribers to its publications.

150. Plaintiff would further suffer from irreparable harm in the form of damage to its reputation in the wine industry because Defendants’ fraud perpetrated on the wineries utilized Plaintiff’s name and good will.

151. Additionally, the Agreements bind Defendants to a confidentiality provision whereby Defendants are prohibited from using Plaintiff’s confidential information, including that of their subscribers.

152. Defendants have already violated the confidentiality provision by improperly using Plaintiff’s confidential subscriber information for their own benefit.

153. Defendants’ use of confidential information has resulted, and will continue to result, in injury to Plaintiff in the form of lost subscribers.

154. A preliminary injunction is necessary to preserve the status quo and avoid further serious and irreparable harm to Plaintiff for which no adequate remedy at law exists.

155. The balance of the equities favor Plaintiff because Defendant would not suffer any harm by issuance of a preliminary injunction.

156. The public interest favors granting a preliminary injunction. WHEREFORE, Plaintiff, The Wine Advocate, Inc., demands issuance of a temporary restraining order and a preliminary injunction against Defendants forcing them to produce any tasting notes and/or articles relating to wines from the regions of Sonoma, Brunello, Barolo, and Burgundy, enjoining them from publishing any and all articles and/or tasting notes relating to the Sonoma, Brunello, Barolo, and Burgundy wines, and enjoining Defendants’ use of Plaintiff’s confidential subscriber information until
the merits are finally decided by this Court, and for such other and further relief as this Court deems just
and proper.

COUNT IX

(UNJUST ENRICHMENT)

157. Plaintiff hereby incorporates by reference each and every allegation set forth above and below as though fully set forth herein at length.

158. Plaintiff conferred a benefit upon Defendants by compensating them and reimbursing them for travel and lodging expenses when traveling to wineries, purportedly on Plaintiff’s behalf.

159. Defendants appreciated the benefit by keeping the compensation and requesting and retaining the reimbursements.

160. Defendants, however, failed to provide Plaintiff with the tasting notes and articles for the wine tastings to the detriment of Plaintiff and for Defendants’ benefit.

161. As a result, Defendants have been unjustly enriched and it would be inequitable to allow Defendants to retain the compensation and reimbursements without providing Plaintiff with the tasting notes and articles to which the compensation and reimbursements relate.

WHEREFORE, Plaintiff, The Wine Advocate, Inc., hereby demands judgment against Defendants, in an amount in excess of $75,000, together with interest and costs of this action, and such other and further relief as this Court deems just and proper.

COUNT X

(BREACH OF GOOD FAITH AND FAIR DEALING)

162. Plaintiff hereby incorporates by reference each and every allegation set forth above and below as though fully set forth herein at length.

163. Plaintiff and Defendants entered into the Agreements whereby Plaintiff would compensate Defendants and reimburse them for expenses associated with tasting wines, and Defendants would provide tasting notes and articles on the same wines.

164. Implied into the Agreements was a covenant to act in good faith and deal fairly.

165. Defendants’ implied duties, include but were not limited to, the duty to not use Plaintiff’s resources to further their own interests to the detriment of Plaintiff.

166. Plaintiff performed its obligations under the Agreements because it paid Defendants their compensation through January 2013 and reimbursed them for their expenses associated with wine tastings performed on behalf of Plaintiff.

167. Defendants failed to act in good faith and their actions prevented Plaintiff from receiving the full benefit of the Agreements because they will not provide the bargained-for tasting notes and articles to Plaintiff for Plaintiff’s use in its publications. To the contrary, Defendants utilized Plaintiff’s resources to benefit themselves and further their own interests.

168. Defendants have, by their culpable conduct, breached the implied covenant of good faith and fair dealing.

WHEREFORE, Plaintiff, The Wine Advocate, Inc., hereby demands judgment against Defendants, in an amount in excess of $75,000, together with interest and costs of this action, and such other and further relief as this Court deems just and proper.

COUNT XI

(DEFAMATION)

169. Plaintiff hereby incorporates by reference each and every allegation set forth above and below as though fully set forth herein at length.

170. Plaintiff publishes a highly-regarded and world-renowned wine review publication.

171. Plaintiff’s reputation in the wine-review industry is unparalleled and is of the utmost importance to its success.

172. Most important to Plaintiff’s reputation and success is that it is absolutely independent from wineries, retailers, and distributors.

173. On or about February 12, 2013, Galloni made statement to the New York Times in which he stated that Plaintiff did not have the required level of independence and/or quality.

174. These statements were false and were made with intent to damage the reputation of Plaintiff to Defendants’ benefit and Plaintiff’s detriment.

175. Defendants’ statements constitute defamation and defamation per se.

176. Plaintiff will suffer injury as a result of such defamation as it will cause subscribers to question the quality of its publications.

WHEREFORE, Plaintiff, The Wine Advocate, Inc., hereby demands judgment against Defendants, in an amount in excess of $75,000, together with interest and costs of this action, and such other and further relief as this Court deems just and proper.

WHEREFORE, Plaintiff, The Wine Advocate, LLC, respectfully requests that the Court enter judgment in its favor, and against Defendants Antonio Galloni and All Grapes Media, LLC, and that they be awarded injunctive relief, damages in in amount to be determined, together with costs and such other relief as the Court deems appropriate.
Ronald F. Wick

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