SAN FRANCISCO — Treasure Island Media officials claim they were left with no choice when they filed a lawsuit against their former marketing director, Jeffrey Smith, who abruptly left the gay porn studio in February.
Smith last week was accused by Treasure Island Media of appropriating company assets, diverting funds that eventually helped drive online traffic to his own affiliate account and removing company officials as administrative users of numerous online accounts.
Smith, who started to work for the company in January 2012, lead Treasure Island Media's marketing and its social media efforts, including writing blog posts under the "Mitch Mason" name.
But last month, Smith abruptly left the studio, and now faces a lawsuit from his former employer that seeks $630,000 in restitution and damages, as well as an injunction.
Treasure Island Media officials contend in the suit filed at San Francisco federal court that Smith absconded with documents, usernames and passwords prior to his departure in February, and in a chance of opportunity registered MitchMason.com, a domain that squats on one of its brand names.
Company officials said that they own the "Mitch Mason" trademark for adult entertainment but now are hamstrung over the website because it is registered to Smith, who "actively promotes that domain and the Mitch Mason trademark for his personal benefit."
Mitch Mason is a fictional personality, Treasure Island Media officials said. Mitch Mason, as the story goes, is a "go-go dancer-turned-business school student-turned-club promoter-turned adult blogger" and relative of another company brand and depiction, Matt Mason.
To appropriate the domain name and develop a business around it, Smith is alleged to have installed spyware on company computers to spy on the studio's business.
"In the months leading up to defendant’s departure from TIM, defendant diverted TIM funds for his personal financial benefit," the suit said. "For example, defendant used company funds to purchase advertisements that diverted online traffic to his affiliate account — allowing defendant to profit — instead of directing traffic to the company website.
"Defendant also used company funds to launch marketing campaigns that directed traffic to his affiliate account and increased defendant’s unreported commissions, instead of directing traffic directly to TIM."
Smith's scheme, the suit said, is ongoing because he took control of company property, "including a corporate laptop, usernames and passwords for social media and cloud storage accounts, as well as physical and backup files full of confidential information."
In the suit, Treasure Island Media charges Smith with allegations of cyberpiracy, breach of contract, trade secret appropriation, conversion, unjust enrichment, false designation of origin, unfair competition and violations of the Computer Fraud and Abuse Act.
The San Francisco studio is seeking a preliminary and permanent injunction over Smith's use of the Mitch Mason trademark, a transfer of the MitchMason.com domain name and $630,000 in damages, as well as profits realized by Smith using MitchMason.com.
XBIZ was unable to reach Smith, who purportedly now lives in New York, for comment; Treasure Island Media's counsel did not respond to an XBIZ request for comment.
