Monday, November 23, 2009 11:33am PST

Monster Beverage Company Sued For Fraud And International Interference

By: Chris Worden

Crown Athlete Management Company, Inc. ("Crown AMG"), an athlete management, marketing, and sponsorship procurement company, has filed a multi-million dollar lawsuit against Hansen Beverage Company ("HBC"), doing business as Monster Beverage Company ("Monster") for fraud, intentional interference with contractual relations, and related claims. The lawsuit, filed in San Diego County, alleges that Monster fraudulently induced Crown AMG to enter into agreements, fraudulently concealed its true intentions to exclude Crown AMG from earning fees and commissions, and made numerous false promises to Crown AMG about potential future business opportunities.

In 2003, Scott "Hollywood" Sepkovic founded Crown AMG as a comprehensive marketing, branding, and athlete management firm. According to the lawsuit, that same year, Crown AMG was recruited by Mark Hall, President of Monster, to help market and build brand recognition for the "new" Monster Energy Drink. The Monster Energy Drink had only been launched the prior year, and had yet to establish significant brand recognition.

Over the next 6 years, Crown AMG was instrumental in building brand recognition for Monster worldwide. HBC's sales skyrocketed from $115 million in 2002 to $1.18 billion in 2008. Crown AMG believes that its efforts helped HBC land the #1 position on the "Forbes 200 Best Small Companies" List in 2005 and 2007. Further, in July of 2006, Fortune Magazine stated that, "Since the beginning of 2004, Hansen Natural's stock [had] risen a Google-stomping 3,900% to $170."

In the lawsuit, Crown AMG alleges that Monster unlawfully interfered with Crown AMG's business by, among other things, filing lawsuits against Crown AMG clients, instructing Crown AMG's clients not to pay Crown AMG, and making false representations to Crown AMG and its clients.

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