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DialMask, Inc. v. Bresolin

United States District Court, W.D. Washington

June 6, 2017

DIALMASK, INC., Plaintiff,
v.
FIORENZO BRESOLIN, an individual; and VITO DELLERBA, an individual, Defendants.

          ORDER DENYING DEFAULT JUDGMENT

          RICARDO S. MARTINEZ CHIEF UNITED STATES DISTRICT JUDGE

         I. INTRODUCTION

         This matter comes before the Court on Plaintiff's Motion for Default Judgment. Dkt. #12. On May 31, 2017, the Clerk of this Court entered default against both Defendants. Dkts. #10 and #11. Plaintiff now seeks judgment in the form of a Declaration stating that Defendants do not have certain rights with respect to the intellectual property at issue. Id. The Court has reviewed the motion, which is now DENIED for the reasons discussed herein.

         II. BACKGROUND

         Plaintiff filed the instant matter on November 13, 2015. Dkt. #1. Service on Defendant Dellerba was accomplished on December 11, 2015, and service on Defendant Bresolin was accomplished on January 18, 2016. Dkts. #5 and #6. Despite Defendants' failure to appear after being served, Plaintiff took no further action for more than one year. In fact, it was not until the Court issued an Order on May 10, 2017, setting forth certain case deadlines that Plaintiff finally moved for default. Dkts. #8 and #9. The Clerk of the Court entered default against Defendants, and this motion followed. Dkts. #10 and #11.

         This case is a Declaratory Judgment action. Plaintiff DialMask, Inc. is a Washington corporation owned by three Washington residents: Mr. Aeron, Mr. Lau and Mr. Wang. Dkt. #1 at ¶ 2. Defendant Fiorenzo Bresolin is a resident of Palm Beach, Florida. Id. at ¶3. Defendant Vito Dellerba is a resident of Montreal, Quebec at ¶ 4. As set forth in the Complaint, the following facts led to the filing of this matter:

         Development of FauxPhone in 2012

         9. Around June 2012, Mr. Aeron authored and prototyped an IPhone software application (the “FauxPhone App”) which provided a valuable telecommunications interface. The FauxPhone App, written primarily as a “client side” application, was not distributed, commercialized, or licensed when it was developed.

         10. Mr. Aeron put the FauxFone App on the backburner because, in June 2013, he began an MBA program at Cornell University where he met Mr. Lau, Mr. Wang, Mr. Bresolin, and Mr. Dellerba.

         Development of the BiziSpot App in 2014

         11. Around February 2014, Mr. Aeron and Mr. Lau began a software project at Cornell called BiziSpot (the “BiziSpot App”). The BiziSpot App sought to simplify the appointment booking of service providers such as plumbers, electricians, barbers, etc. The BiziSpot App is not and was not a telecommunications application and had nothing in common with and was entirely separate and independent from the FauxPhone App.

         12. While in Los Angeles around July 2014, Mr. Aeron discussed the formation of a company to support the development and marketing of the BiziSpot App with his Cornell classmate Mr. Bresolin.

         13. In February 2015, Mr. Bresolin demanded a 40 percent interest in the entity that would market the BiziSpot App. The details were to be worked out later.

         14. In May 2015, Mr. Aeron, Mr. Lau, Mr. Bresolin and Mr. Dellerba attended graduation at Cornell. Mr. Bresolin and Mr. Aeron again discussed BiziSpot.

         15. In June 2015, Mr. Aeron, Mr. Lau, Mr. Bresolin and Mr. Dellerba met in Montreal to discuss the BiziSpot App. On day one of the Montreal meetings, Mr. Aeron and Mr. Bresolin met privately and verbally agreed to create a company to market the BiziSpot App (this entity will be referred to as the “BiziSpot Venture”). The BiziSpot App and the BiziSpot Venture are collectively referred to as “BiziSpot.” Mr. Bresolin and Mr. Aeron agreed that the value of the BiziSpot Venture would be $1 million. They further agreed that Mr. Aeron's contributions to date would be valued at $600, 000 (60 percent ownership) and that Mr. Bresolin would contribute $400, 000 in cash (40 percent ownership). When bringing on any more partners, their respective shares would be diluted pro rata. The agreement was verbal, not written. Mr. Bresolin never contributed a penny of the promised $400, 000 to the BiziSpot Venture.

         16. On the second day of Montreal meetings, Mr. Aeron and Mr. Bresolin decided to give Mr. Lau and Mr. Dellerba 4 percent each in the BiziSpot Venture. Thus, the ownership breakdown for BiziSpot would be: Mr. Aeron at 55.2 percent; Mr. Bresolin at 36.8 percent; Mr. Dellerba at 4 percent and Mr. Lau at 4 percent. Again, there was no written agreement.

         17. On July 2, 2015, Mr. Aeron registered “BiziSpot, Inc.” as the entity for the BiziSpot Venture with the Washington Secretary of State. Since Mr. Bresolin had not contributed the $400, 000 as promised, BiziSpot, Inc. was filed only in Mr. Aeron's name. A copy of this registration is attached as Exhibit 1.

         18. In mid-July 2015, three of the classmates met in Seattle to discuss the BiziSpot Venture.

         Mr. Bresolin Declines Participation in FauxPhone App

         19. During dinner the night of July 15, 2015, Mr. Aeron showed Mr. Bresolin the FauxPhone App from 2012. Mr. Aeron asked Mr. Bresolin if Mr. Bresolin was interested and offered to let Mr. Bresolin purchase a 10 percent interest in whatever came from the FauxPhone App for $150, 000. Mr. Bresolin declined and said he was not interested. His only interest was in the BiziSpot App.

         20. After Mr. Bresolin's rejection of participation in the FauxPhone App, Mr. Aeron decided to change the name from FauxPhone to DialMask and he registered the domain name “DialMask.com” on July 17, 2015.

         21. Mr. Dellerba arrived in Seattle on July 18 and the classmates spent the day working through the business plan, financial plan and app features for the BiziSpot App.

         22. Mr. Dellerba left Seattle on July 19 and Mr. Bresolin left Seattle on July 21, 2015.

         23. On July 21, 2015, Mr. Aeron and Mr. Lau met with a Seattle business owner to understand how his tanning shops managed appointments. The feedback taught Mr. Aeron and Mr. Lau that the market was highly competitive and that there were already apps that offered features above and beyond what the BiziSpot App purported to offer. Mr. Aeron and Mr. Lau concluded that, without considerably more features, the BiziSpot App would not be commercially viable.

         24. On August 10, 2015, Mr. Aeron, Mr. Lau, Mr. Bresolin and Mr. Dellerba had a phone conference. Mr. Aeron discussed the visit with the business owner and stated that he was no longer interested in BiziSpot because it was not commercially viable. In addition, Mr. Aeron was exhausted from working long hours and never being paid for those hours. It was clear to Mr. Aeron that Mr. Bresolin would never invest the money he had promised to BiziSpot.

         25. In the phone conference, Mr. Bresolin and Mr. Dellerba asked Mr. Aeron to take some time away and reconsider. Mr. Aeron declined and said his mind was made up.

         Development of the DialMask App and Launch of DialMask, Inc.

         26. On August 15, 2015, during a much-needed vacation with his family, Mr. Aeron called Mr. Lau and asked if Mr. Lau wanted to work on DialMask. Mr. Lau agreed, and the two agreed that Mr. Lau would own 15 percent of the venture.

         27. Two days later, Mr. Aeron and Mr. Lau asked Mr. Wang, who had digital marketing experience, to join the DialMask project for 5 percent ownership. Mr. Wang agreed.

         28. On August 22, 2015, Mr. Aeron registered DialMask, Inc. with the Washington Secretary of State. A copy of that registration is attached as Exhibit 2.

         29. On August 31, 2015, Mr. Aeron, Mr. Lau and Mr. Wang signed a written “Partners' Agreement” detailing the ownership in DialMask, Inc. A copy ...


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