© 2015 The Texas Lawbook.
By Mark Curriden
(April 4) – A North Texas federal jury has rewarded two businessmen with a nearly 6,800 percent return on their $1,500 investment four years ago in a Dallas-based gaming channel on YouTube.
A four-woman, three-man jury ruled Friday that Videogames YouTube Channel and two of its owner/operators conspired together to breach their contract agreements with two outside investors and defraud the men of profits from the business they were promised.
The panel awarded the defrauded investors, David T. Moss of North Carolina and Brandon Keating of Illinois, $20.3 million in damages.
Lawyers involved in the case say that the investment fraud issues raised in this case are widespread involving YouTube channels and that hundreds – maybe even thousands – of similar cases are likely to be filed in the next few years.
Moss and Keating claim in their lawsuit that they each invested $1,500 in 2012 in Videogames YouTube. In return, the Dallas company’s founder, Marko Princip, promised them each a 30 percent stake in the business and 30 percent of the profits, according to court documents.
The federal lawsuit alleged that Princip and another business partner, Brian Martin of California, failed to keep their contract commitment and conspired together to commit fraud and tortious interference.
Lawyers for Princip and Martin argued that Moss terminated his partnership with Videogames YouTube in 2012 and that Keating and Princip never signed their final partnership agreement.
After a weeklong trial, the jury found for the plaintiffs.
“We won this case because we exposed the perjurious testimony of the defendants,” said Barnes & Thornburg partner Victor Vital, a lawyer who represented Moss and Keating.
Vital said the evidence showed that Videogames YouTube had 813 million clicks and Princip was paid $3 per 1,000 clicks, or $2.5 million, for the advertising on the site.
The jury awarded the plaintiffs 60 percent of the $2.5 million, plus more than $1.5 million in future earnings and $16 million in punitive damages.
“This case demonstrates the big business that YouTube has become,” said Dallas lawyer Dan Wyde, who also represents Moss and Keating. “There are cable networks that don’t have the viewers that these guys do.
“This is a problem running rampant in the YouTube community,” said Wyde, who is a former Dallas judge.
Robert Wilson, a Dallas lawyer representing the defendants, did not respond to a request for an interview.
The case took an additional twist late Sunday when the federal judge in the case ordered Martin and his lawyers to appear in court Tuesday to explain a Twitter message Martin allegedly sent out Friday night after the verdict inviting video game directors to upload pornography to the YouTube channel.
The judge ordered the parties to do nothing to harm the channel or its value.
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