You can't just change the letterhead on the stationary and claim it's a new business and leave your investors behind.
I agree she handled this very poorly, but just trying to look at the other side. Is she really so stupid to literately pitch the same exact company on TV, just with the LA changed to Global in the name?
It's possible she is, but starting from that assumption is an excuse to avoid thinking, in my opinion.
And on his side, if it was really as bald-faced as he claims, why is he moaning about it on his blog in a resigned manner rather than taking legal action?
The obvious answer is that it is far cheaper to talk about what will happen if lawyers get involved than to actually involve them. It is in everyone's interest to resolve this through negotiation. There is no need to openly state the obvious fact that lawyers can get involved if needed.
An example of a desirable result is that all assets are transferred back to the original company, the CEO remains in charge, chastened by the experience, Mark Cuban is cut into the deal with the original company, and previous investors get a piece of some future deal with Mark Cuban.
This result is much better for EVERYONE than anything achievable with lawyers. But you can't get there if you get people unnecessarily outraged.
You can't separate yourself from your partners and claim you own the brand, the merchandise, the copyrights, the trademarks, the domain name, and other assets alone.
I'd be willing to bet the rest hasn't changed much if someone were to do some digging.
And, honestly, I don't know what he's trying to accomplish with the blog post. The post seems like a very bad idea for several reasons at least.
What she did was foolish, but re-using a company name is a far cry from stealing IP.
Has anyone looked to see what the old company does vs. the new one?
Lawyers cost money
The parties who will get screwed are The Style Club (more specifically the CEO), and Marks, who should have kept quiet and let her make the company a huge success with Cuban's help before coming forward with the dirt. He had the nut hole card but he flashed it too early.
ROFL. What's a Nut-hole Card? Hope it's not what I think it is lol.
You are right. I'd have held out and seen if it's a huge success and then enforce the agreement. Revenge is best served cold.
The 'nut' is the best possible hand in a given deal.
The 'hole card' is the face-down card only the player knows.
It's not the 'name' that is in question.
It's a separate legal entity.
It's a completely different company.
i.e. different shareholders.
This is a definitely a crime.
More seriously, it could very well be an entirely different business, and she just liked the name Style Club. Re-using almost the same business name is hardly a crime.
The biggest issue, in my opinion, is that she "shut down" her old business without notifying her investors. Now, to be practical, most customer-less startups (that is, most startups) don't have an official day where everyone walks away. One founder gets a day job, another starts spending a little more time on other projects, and so on. Everyone involved, including investors, knows that its dead. Startups that haven't done anything for 4 years don't suddenly take the world by storm.
Nevertheless, she should have "officially" shut down her startup if she was going to go on national TV pitching her new one.
While she handled this poorly, I would be wary of placing too many restrictions on allowing entrepreneurs to start new businesses. Although if they are nearly identical and you are a success, you will get into trouble (just ask Zuckerberg...)