(CN) – The promoter of a popular electronic music festival in Europe claims in court that a Fort Lauderdale entertainment firm locked it out of a licensing agreement after falsely representing that it owns the events trademark.
In a federal complaint filed in Miami, plaintiff Adria MM Productions Ltd. says it has been the exclusive promoter of “Ultra Europe” and other “Ultra”-branded events since July 2013.
It claims the inaugural electronic music festival attracted 100,000 fans, and that the audience has grown with each successive event.
The defendant Worldwide Entertainment Group Inc., also identified as “Ultra” in the complaint, is the organizer and promoter of the Ultra Music Festival that takes place every year in Miami.
Ultra Music Festival was founded by Russell Faibisch and Alex Omes in 1999.
The complaint says Ultra entered into various licensing agreements to grow its brand around the world, and sought out AMM ” because AMM is one of the largest promotion companies in Croatia and holds exclusive licenses and rights to venues in Croatia and was a successful promoter of musical events in Croatia.”
AMM says that Ultra made it believe that it owned the mark “Ultra Europe,” and the five-year licensing agreement required it to pay the defendant licensing and promotional fees for the use of its proprietary marks in Europe.
But the plaintiff promoter says the relationship between the parties was fraught from the beginning. AMM claims that despite the success of the 2013 festival in Croatia, it actually lost money because of Ultra’s demands, which included the payment of advances.
After the launch of Ultra Europe in 2013, Ultra amended the agreement making it more favorable for itself by demanding “exclusive approval of vendors, prohibitively expensive staffing arrangements, luxury travel arrangements and additional promotional fees,” AMM says.
“The amendments to the Agreement provided more control over the Festival to Ultra – despite AMM holding all responsibility for the execution of the event – and became even more burdensome on AMM and made it even more difficult for AMM to profit from the Festival and its relationship with Ultra,” the complaint says.
According to the complaint, AMM continued to promote “Ultra Europe” in 2014, 2015 and 2016, but despite the success of the events, it continued to lose money.
AMM says it continued to fulfill its obligations under the agreement and to keep good relationships with fans, vendors, hotels, restaurants, ticketing companies and artists.
Then, Ultra announced that the 2017 “Ultra Europe” festival would take place July 14-17, 2017, and tickets went on sale in October 2016.
AMM alleges that after the 2016 festival in Europe ended Ultra demanded the signing of a new five-year license agreement, which also included “unreasonable and financially devastating terms” for AMM.
AMM says it didn’t want to succumb to Ultra’s demands and attempted to renegotiate the agreement, but Ultra refused.
“Ultra responded by breaching the Agreement and immediately cutting off AMM’s access to social media channels used to promote the Festival in 2017, disabling AMM’s email accounts used to promote the Ultra Europe in 2017, prohibiting AMM from making any statements to fans or the media, and revoking AMM’s rights to promote the Festival in 2017,” the complaint says.
AMM claims that the cancellation of the event would be an upset for fans and local businesses, and that it could damage its reputation and Ultra’s.
But Ultra continued with its demands and on March 3, 2017, it sent AMM a “notice of default” with a list of purported breaches under the agreement.
AMM says that at that time it discovered that Ultra didn’t have any rights over proprietary marks in Europe, specifically in Croatia.
AMM is seeking compensatory damages on claims of fraud in the inducement, fraudulent misrepresentation, breach of contract, fraud, unjust enrichment, and tortious interference with a business relationship.
It’ is represented by Vincent Alexander of Kozyak Tropin & Throckmorton LLP, in Miami,. and Yano Rubinstein, of San Francisco, Calif.
A representative of Ultra did not immediately respond to an emailed request for comment.
EDITOR’S NOTE: Three days after the publication of this article, Worldwide Entertainment Group filed a counterclaim to the complaint against it in Miami. In the May 6 filing, Worldwide Entertainment Group denied all of the allegations brought by Adria MM Productions. In addition to asserting several defenses, including good-faith performance of the agreement, Worldwide insists that it was the true owner of the marks Ultra Europe and Croatia Music Week.