Home > News > Playboy Hit With Lawsuit From Energy Drink Licensee • Bookmark   • Newsletters   • Register Search Options


Playboy Hit With Lawsuit From Energy Drink Licensee

Playboy Hit With Lawsuit From Energy Drink Licensee
Get XBIZ News
XBIZ Research
Will virtual reality boost the paysite market?
Yes, it will soon
Yes, but in a few years
Out of 170 votes. Results based on votes submitted by members of XBIZ.net social network.
Oct 30, 2012 10:30 AM PDT    Text size: 

CHICAGO — Playboy Enterprises has been hit with a lawsuit after trying to sever its deal with the company that makes and distributes its energy drink.

The suit filed in Cook County Court claims that Playboy wrongfully cut its licensing agreement and sought new distribution.

The plaintiffs, Play Beverages (PlayBev) and CirTran Beverage Corp. are also suing brokers United Licensing Group and RLC Partners, and distributor Redi FZE.

Also named in the suit is broker Jimmy Esebag, RLC principal Ron Coopersmith and Redi FZE principal Paul Levin.   

According to Courthouse News, Playboy allegedly granted PlayBev the right to manufacture and sell the Playboy Energy Drink in 2006, and a year later made a distribution deal with CirTran.    

"During the last four years, PlayBev and CirTran have successfully grown the network to a point where they have launched the product into more than 30 countries and have obtained distributors for more than 80 countries," the lawsuit states. "Last year, PlayBev and CirTran sold more than a half million cases of the Playboy Energy Drink worldwide."    

Although the deal was for five years, the companies claim Playboy knew that some of the distribution agreements extended beyond the initial term and that Playboy "represented to prospective distributors that PlayBev's license was in good standing."    

Admitting it failed to meet minimum sales per the agreement, PlayBev however maintains that Playboy " appreciated that PlayBev had made significant progress in developing the market for the Playboy Energy Drink."    

The company also claims that Playboy's vice president of global licensing represented that minimum net sales  "would never be an issue from Playboy's perspective as long as PlayBev continued to develop its territory and expand its distribution network."    

But when new management took over last spring, the plaintiffs claim Playboy started to seek a a replacement licensee. "Playboy began working with Mr. Jimmy Esebag and Mr. Ron Coopersmith during the spring of 2011 in order to cut PlayBev out of the energy drink distribution network," the lawsuit states.    

The complaint continues, "Playboy did not disclose to PlayBev that it had entered into negotiations with alternative licensees, and did not disclose to PlayBev that its brokers were attempting to secure an alternative licensee. To the contrary, Playboy actually encouraged PlayBev to invest additional funds and resources into its distribution network in order to better position itself for the next license renewal period.    

"Playboy was simultaneously asking PlayBev to make an additional royalty payment of approximately $1.8 million, even though Playboy planned to declare PlayBev in default once one of Mr. Esebag's alternative licensee placed its sufficient funds into escrow to demonstrate its commitment to the proposed deal."    

PlayBev is claiming that Playboy started negotiating with Redi FZE while it was still under contract and began working closely with Redi FZE, in order to assist that distributor in breaching its distribution contract.

On July 14, Playboy allegedly notified distributors that PlayBev had defaulted on its licensing agreement, and was in the process of terminating the deal.    

PlayBev said in the complaint, "Playboy's communication was unsolicited and intended to disrupt the distributor network by creating unnecessary concern and uncertainty among the distributors.”

The plaintiffs are seeking an injunction barring Playboy from terminating the license agreement, and unspecified damages for breach of contract, breach of good faith, tortious interference and promissory estoppel.    

More ways to get XBIZ News:  RSS Feeds  |  E-Newsletters  |  Desktop Widget  |  Mobile
Looking for porn star news and behind-the-scene videos? Check out XFANZ.com !


WIA Profile: Kate Hodgson-Egan

Each month, industry news media organization XBIZ spotlights the career accomplishments and outstanding contributions of Women in Adult. WIA profiles offer an intimate look at the professional lives of... More »

Q&A: Holiday Products Founder Moe Levy Reflects on Decades of Career Accomplishments

Born and raised in the Bronx, N.Y., as an only child, Moe Levy learned to become business savvy at an early age from his parents. Even more importantly, Levy says his parents instilled in him their people-oriented... More »

AWSummit’s Alexandru Gheorghe Has Eyes Set on Growth

The AWSummit has quickly made its mark and has become a top draw for chat hosts, studios and cam sites from all over the world. Founded by CEO Alexandru Gheorghe just two years ago, the cam-centric AW... More »
Stay informed of the latest industry developments. Get XBIZ newsletters delivered to your inbox. Subscribe today!
Enter email address:

* To manage existing subscriptions click here.

Submit your press release to
multiple news outlets with 1 click.
Subscribe to RSS news feeds or
add free content to your website.
Access XBIZ news and articles
with your mobile device.
Subscribe to XBIZ Premiere magazine, the industry's leading adult retail trade publications, delivering the most timely and comprehensive business news and information to producers and retailers of adult products.


XBIZ 2017

Jan 09 - Jan 13
Hollywood, CA

XBIZ Awards 2017

Jan 12 - Jan 12
Los Angeles, CA

ANME Founders Show

Jan 14 - Jan 15
Los Angeles Marriott Burbank Airport

Everything To Do With Sex Show

Jan 20 - Jan 22
Montréal, Québec
Everyday thousands of business professionals browse XBIZ's industry directory for quality products and services. Not listed yet? Your company could be losing potential new business. Submit your company today!
Use XBIZ RSS feeds to stay informed of the latest industry developments or as a content syndication tool for your website!