In yet another not-so-irie fight for the perpetually challenged Marley Coffee, the coffee roaster has launched a desperate lawsuit against its former chairman, Rohan Marley, over the Marley family’s decision to end its licensing agreement with the company he founded in 2007.
That lawsuit says Rohan Marley, the son of reggae icon Bob Marley who resigned from Marley Coffee in late June, violated a 15-year licensing agreement with the coffee company when he and the Marley estate launched a Marley Coffee Jamaica brand with a Korean company.
The estate of Bob Marley — operating as Hope Road Merchandising and 56 Hope Road Music — ordered Jammin Java to abandon the use of the Marley name and likeness in late June, arguing the company breached the licensing agreement in several ways, including failing to make royalty payments. But Jammin Java, based in Denver’s Sunnyside neighborhood, claims Rohan and the estate violated the agreement and has asked the U.S. District Court in central California to reject the termination of the licensing deal.
In the last five years, Marley Coffee has grown from about $403,000 in sales to more than $12.3 million in revenue, with product sold in 12,500 stores including chains like Kroger, Safeway and Target. The company spent $1.5 million to secure shelf space in those stores and another $1.2 million promoting its presence in those retailers, according to court documents.
“The viability of Jammin Java’s entire business is wholly dependent on its right to utilize the Marley Coffee brand name and other intellectual property owned by” the Marley family, read the
And Marley Coffee would not have such cachet if not for Jammin Java, Tran argued.
But the tribulations of Marley Coffee are plentiful. The company has been dragged into a lawsuit between its former chief executive, Shane Whittle, and the Marley estate. The Securities and Exchange Commission that harvested The company in May
The company’s stock price, which reached a high of $6.35 in the spring of 2011, was trading for , down from about 6 cents in early August.
Tran, in court documents, said his company’s financial woes were nearing an end this year as he negotiated with a potential investor who was contemplating a $10 million equity stake in Marley Coffee. A pivotal requirement for that deal was a long-term licensing agreement with the Marley estate.
“Then, out of nowhere,” Tran said in court documents, the Marley estate terminated the licensing agreement, adding he was “shocked” at the sudden reversal, considering the company had settled the Whittle lawsuit and SEC charges.
“The timing was devastating,” Tran said in the filing, noting that Rohan Marley “was completely missing in action” this spring, selling almost 900,000 shares of the company before resigning in June. A short-term deal to keep the licensing agreement afloat died this summer after member of the Marley family told Jammin Java executives that “we like Marley Coffee. We don’t like Jammin Java,” reads Tran’s declaration.
Tran said he is getting regular phone calls from worried creditors. He said his company is “desperately in need of cash flow.”
Without a restraining order suspending the licensing agreement termination, Tran told the court, Jammin Java will default on loans, stop delivery of Marley Coffee to its hard-won network of stores, end marketing efforts and end its negotiations with potential investors.
“Simply put,” Tran said, “the company will die.”
