Almost six years after shutting down his business, Bill Magarity can wait a few more months to get a final check for $5.6 million.
That’s how much a jury awarded Magarity and his partner for breach of contract in a lawsuit involving their L.A. company, Smart Marketing Group.
In its heyday, Smart Marketing sold marketing services to auto dealers, including telemarketing and organizing weekend sales events. In 2003, Publications International Ltd., the Chicago-based parent of Consumer Guide magazine, proposed a deal: When Web surfers came to the Consumer Guide site looking for a car, the site would collect their information and Smart Marketing would sell that information to auto dealers as sales leads.
Smart Marketing went to work and had its sales agents pitch the program to dealers. Soon the company had signed up 600 dealers, who weren’t required to pay until they received the leads. However, technical glitches on the Consumer Guide end delayed the actual distribution of those leads. Then, in late 2003, Consumer Guide pulled the plug on the whole program. However, Smart Marketing had already advanced commissions to its sales agents and spent money settiing up and marketing the program.
“They owed us a lot, about $500,000, and we had been fronting the operation with our own money,” Magarity recalled.
Smart Marketing laid off 25 employees and the company became a shell. To survive, Magarity operated a call center and his partner opened an insurance agency in Temecula. They filed a breach of contract lawsuit in January 2004.
In February 2009, a jury awarded Smart Marketing $5.6 million, and last month a judge refused to alter that amount. Magarity expects an appeal, but hopes to prevail. He said he never found out why Consumer Guide killed the program, but has some advice for marketing firms on commission.
“Make sure you’re getting paid on time,” he said. “And don’t be afraid to stand up for what is yours, no matter how big the other company is.”
Neither Consumer Guide nor its law firm, Much Shelist of Chicago, responded to requests for comment.
Parked in Garage
Garage Public Relations has assumed marketing duties for Multeepurpose, a combination caf & #233; and clothing store in Little Tokyo.
Multeepurpose is a concept store for what could become a chain. The caf & #233; section serves organic coffees and teas, pastries and organic vegetarian plates. The retail operation sells clothes that make fashion an act of politics or activism. Customers select a T-shirt and an on-site printing machine decorates it with slogans about sustainability, liberty or health.
Garage PR handled publicity and event coordination for the launch of the store in July, and will continue to promote the store and the Multeepurpose clothing line.
Bar Codes or Bust
Fox Home Entertainment employed sex, bar codes and video discs to increase sales at this year’s Comic-Con International in San Diego.
To promote the DVD and Blu-Ray release of raunchy comedy “Miss March,” the Century City studio hired sexy models to walk around the exhibit hall of the comic book convention. The girls wore skimpy underwear embroidered with bar codes. Fans could scan the bar codes with their mobile phones and immediately download video from “Miss March,” an R-rated film about a guy whose former girlfriend turns up as a centerfold.
“This campaign was a direct result of understanding the rabid fan base that attends Comic-Con,” said Mark Levien, executive director of digital marketing for Fox.
Butterfinger Video Blog
Nestle USA in Glendale has launched a contest to find the next great director of TV commercials.
The contest asks would-be directors to submit a one-minute video about a Butterfinger candy bar, based on the old tagline “Nobody’s Gonna Lay a Finger on My Butterfinger.” Four entries selected by judges will be posted online, where people can vote for their favorite. The winner will receive $25,000 and have the video featured in a 15-second TV commercial.
Company policy does not permit Nestle to name the agencies involved on the project. But spokeswoman Tricia Bowles said in a statement that the campaign is based on research showing Butterfinger eaters are avid social media users.
Agencies & Accounts
Retail marketing consultancy Two West has transferred Kris Flint to lead its Hollywood office. Flint, who comes from Two West headquarters in Kansas City, Mo., co-founded the company in 1997. He will focus on new clients and acquisition opportunities in Los Angeles. Amy Levy PR is promoting the new book “Beyond the Brochure: An Insider’s Guide to Private Elementary Schools in Los Angeles.” The $40 self-help tome, set for release in September, has three local authors who can help Levy promote sales through appearances and interviews. Blaine Group in Beverly Hills has been retained by Gerber & Co., a Century City accounting firm, for ongoing marketing and public relations. Using Gerber’s trademarked slogan of “Beyond Bean Counting,” Blaine will promote the firm’s software, which provides clients a quick summary of financial statistics online and in real time Health Club Media Network, a marketing firm that puts national ads in health clubs, has announced that Tom Gosney is the company’s new chief financial officer. Gosney joined the Woodland Hills company last year from Universal Music Logistics, the distribution division of Universal Music Group, where he served as chief financial officer.
Staff reporter Joel Russell can be reached at [email protected] or at (323) 549-5225, ext. 237.
