Photoflex pays $100k damages to settle Amvona defamation case

Photoflex, the lighting manufacturer, has paid $100,000 to Amvona, formerly a photographic retailer, to settle a lawsuit between the two US-based companies.

According to Amvona — which closed its retail presence in 2010 to focus on its blog — the lawsuit concerned “Photoflex’s unfair and deceptive business practices, including defamatory and materially misleading statements made by Photoflex and [their company president, Sharon Reeves] concerning Amvona”.

Kelly Broadbent, Amvona’s corporate lawyer, said: “It would have sufficed had Photoflex agreed to simply ‘set the record straight’, but unfortunately they repeatedly foreclosed on all options outside of litigation.”

Amvona’s press statement cites an opinion from the court judge Raymond P. Veary, Jr., who had written:

“…there appears to be a reasonably achievable factual basis for finding actual malice on the part of Photoflex. By targeting Amvona’s home territory on the opposite coast, Photoflex appears to have spitefully intended to interfere with Amvona’s relationship with its prospective customers. Furthermore, the press release, in conjunction with the press agent’s comment, certainly went unreasonably beyond any legitimate corporate interest Photoflex might have had…”

However, Photoflex said that they “believed it was unlikely that a jury would be persuaded that any of amvona’s claims had sufficient merit to warrant a finding of any wrongdoing against Photoflex.” Nonetheless, earlier this month Photoflex announced that they had moved to settle after it became uneconomical for them to continue in court:

“Although Photoflex was fully prepared to present its case to a jury, the decision to end the litigation by means of a settlement, all of which was paid by Photoflex’ insurers, reflected a business judgment by the insurers that the anticipated costs associated with a trial and any subsequent appeal exceeded the amount of the settlement.”

The allegedly offending statements were made in January 2005, in a Photoflex press release and in a newspaper article. In the preceding months, Photoflex had sued Amvona, accusing the then-retailer of acquiring Photoflex products, copying the designs and sending them overseas to be manufactured more cheaply, as well as “misappropriation of Photoflex’s intellectual property”. The case that Photoflex brought against Amvona was concluded by the entry of a judgment for Photoflex in the amount of $50,000, in exchange for Photoflex “dropping” its “charges”. Amvona then filed suit in December of that year, claiming damages for defamation.

The latest settlement releases Photoflex from any claims made by Amvona regarding the comments. Amvona has announced that it will donate all of the money it receives from the settlement to charity.