Affinity Biotech sues shareholder for starting rival business

HOUSTON - Affinity Biotech Inc. has filed suit against a former employee after he allegedly started a rival company, recent court documents say.

A lawsuit filed April 1 in the Houston Division of the Southern District of Texas claims Sebring, Fla., resident Thomas L. O'Neill possessed confidential information and used it to form Midwest IV LLC unbeknownst to the plaintiff.

Affinity, a Houston-based business which specializes in selling hemophilia factor products and ancillary goods and services, hired O'Neill as a bookkeeper in early 2009.

He became a shareholder, director and president later that year, and though his employment status was terminated "not for cause" late last year, the defendant stayed on as a 25 per cent shareholder and director.

The suit asserts that O'Neill formed Midwest IV "with the intention of competing directly" against the complainant on Aug. 11, 2012, though he has "a duty not to usurp Affinity's business opportunities."

"O'Neill failed to disclose these plans to Affinity," the original petition says.

"Affinity learned of them through the 'industry grapevine.'"

According to the suit, the respondent admitted that he intends to compete with his former employer in its marketing niche.

"The fact that an Affinity shareholder and director is directly competing against it is reasonably likely to damage Affinity's reputation in the hemophilia community and also to damage the morale of Affinity's employees," it says.

Consequently, the plaintiff seeks unspecified monetary damages.

Attorney Donald W. Gould II of Johnson DeLuca Kurisky & Gould in Houston is representing Affinity.

Case No. 4:13-CV-915