California Apparel News

Last November, Paul Frank Sunich suddenly left the company he co-founded, leaving many in the apparel community to question why the enigmatic designer would split with the company that bears his name and has featured his familiar “Julius the monkey” character since the business first launched in 1995.

At the time, the remaining executives at Paul Frank Industries released a statement that Sunich would no longer be involved with the company, but would remain a stakeholder.

On March 15, Sunich filed a pair of lawsuits against Costa Mesa, Calif.–based Paul Frank Industries—one suit is for copyright infringement and the other seeks to dissolve the company.

The first suit, filed in the United States District Court’s California Central District, charges that PFI infringed on Sunich’s copyright and demands reimbursement for PFI’s use of the Julius character since Sunich left the company.

According to the lawsuit, Sunich was terminated in November 2005 “without cause” and given no compensation, other than his salary, for his ownership stake in the company, which he founded in 1995 with Ryan Heuser.

The suit details the history of PFI, charging that Sunich created Julius in 1995, when he made a purse with an appliqueacute; of the monkey as a gift for his girlfriend. Around the same time, Sunich partnered with Hauser to create clothing and accessories bearing Sunich’s artwork, which they sold at flea markets and trade shows. In 1997, John Oswald joined the partnership and the three incorporated the company as Paul Frank Industries, with each partner holding an equal stake in the business. In the ensuing years, the company has grown to become a multi-million dollar business with annual revenue exceeding $40 million, according to the suit. As the company grew, Sunich created additional characters to complement Julius, including a giraffe named Clancy and an elephant named Ellie.

The suit argues that Sunich, as the creator of the Julius character, is the sole owner of the character and seeks to halt Paul Frank Industries from selling merchandise with it—as well as “derivative characters based on Julius”—charging that PFI is infringing on Sunich’s copyright. According to the suit, Sunich alone registered Julius with the Register of Copyrights in the Library of Congress and never transferred ownership of the image to anyone else.

Sunich’s attorney, Howard E. King, with Los Angeles–based King, Holmes, Paterno & Berliner LLP is seeking that “anyhellip;infringing Julius products be impounded and destroyed.”

Sunich is also seeking to recover money and profits earned from the sale of Julius product after he was fired and is asking for an accounting of all the company’s business in order to determine how much he is owed, including interest. In addition, he seeks to recover attorneys’ fees and other costs of pursuing the lawsuit.

“It was basically three guys splitting the profits three ways. So, once they dumped him, they don’t get the monkey anymore,” said King.

The second suit, filed in Superior Court of California, is seeking corporate dissolution of the company on the basis of breach of fiduciary duty, breach of oral contract and other claims.

“Basically, he seeks the value of his interest in the company that he built and the right to go forward and design creations for other people,” said King.

Through his attorney, Sunich issued a statement, saying, “I love being able to create. I was promised by the partners I brought in that they would make my creations even more profitable. What they didn’t tell me was that they would snatch those profits for themselves.”

Heuser did not respond to requests for comment and referred inquiries to the company’s publicist, who issued the following statement on the company’s behalf: “Our attorneys have not yet received or reviewed the complaint so we don’t know much at this point. Other than that, we have no comment at this time.”