Ex-Mexican Partner Guilty of Breach of Fiduciary Duty Against Kolay
Los Angeles, CA, November 11, 2022-In a legal business dispute waged in the United States and Mexico, a U.S. District Court judge on November 9 entered judgment on a jury’s verdict that the Mexican defendants, Luis Barroso De La Fuente and a rival company he created, conspired to breach fiduciary duties owed to their U.S. partner, City of Industry, California-based Kolay Flooring International and its owner, president and CEO Dan Mitchell.
In Mexico, Kolay and Mitchell have filed actions against Barroso De La Fuente alleging unfair competition and claiming he illegally registered a Kolay trademark there in his own name without authorization from Mitchell or Kolay. Kolay’s Mexican counsel said Mitchell and Kolay may pursue lost profits and damages after those matters are resolved. Also, local partners of Mitchell and Kolay are seeking criminal actions and an injunction against Barroso De La Fuente regarding alleged threats made to Mitchell and his Kolay partners.
The company created by Barroso De La Fuente and his father in Mexico is Pisos Kolay, which changed its name to Lalur, after Mitchell became aware of Barroso De La Fuente’s misconduct. U.S. District Court Judge Josephine Staton ruled in the judgment that Pisos Kolay and Lalur are the same entity, despite arguments from Barroso De La Fuente and Pisos Kolay that the companies should be treated separately.
Allegations against Barroso De La Fuente and his company in the U.S. case included, among others, claims for breach of fiduciary duty and conspiracy to harm Kolay.
Kolay Flooring International is a manufacturer with over 25 years of experience in the manufacturing, distribution and sales of floorcovering.