AppleOne, CoreStaff suit slated for March 24 trial

FORT COLLINS – Plaintiffs for AppleOne Employment Services of Glendale, Calif., have been granted a jury trial in their case against CoreStaff Acquisition Sub #5 Inc., a Colorado-based subsidiary of CoreStaff Inc. of Houston.After attorneys for both sides cited scheduling conflicts with a February trial date, a new date was set for March 24. The trial will take place in U.S. District Court in Denver.
Last February, CoreStaff purchased Richard Keith Enterprises Inc., a company operating in Colorado as AppleOne Employment Service of Colorado.
The plaintiffs, AppleOne Service Inc., AppleOne Franchise Inc. and Howroyd-Wright Inc., all owned or controlled by Bernard Howroyd, filed suit alleging that Richard Keith Enterprises was a franchise of AppleOne and that CoreStaff, in its purchase of Richard Keith Enterprises, infringed on AppleOne’s trademark, misappropriated trade secrets and interfered with the agency’s existing and prospective business rights.
No one involved in the case would comment, but court documents claim the following: Richard Keith Enterprises, owned solely by Richard Keith, did business from 1990 to February 12, 1996, as AppleOne Employment Service of Colorado. In July 1991, AppleOne sent a franchise agreement to Keith for review, and that following October, Keith signed the agreement.
Negotiations for the sale of Richard Keith Enterprises to CoreStaff began in 1995. On Jan. 8, 1996, AppleOne gave notice of its intent to terminate the franchise for failure to pay franchise fees. Keith’s deal with CoreStaff was sealed Feb. 12, 1996, and on Feb. 14, he accepted termination of the franchise agreement with AppleOne.
AppleOne claims it is owed $1.7 million in franchise fees and seeks more than $5 million in damages.
CoreStaff contends that Richard Keith, not Richard Keith Enterprises, entered into the franchise agreement. And even if Richard Keith Enterprises was a party to the agreement, the agreement does not cover the information sold to CoreStaff and that information does not constitute trade secrets.
The company also asserts that because Keith’s franchise with AppleOne was terminated, CoreStaff could not have interfered with AppleOne’s business advantage in Colorado.
Keith, who received an estimated $9 million for his company, is now president and CEO of CoreStaff’s national expansion group.
CoreStaff Acquisition Sub #5, a Colorado corporation, is headquartered in Fort Collins and operates 12 offices in Colorado and Wyoming. The temporary employment agency anticipates almost $23 million in sales this year.
AppleOne, a 33-year-old company based in Southern California, has increased its presence in Colorado, and now has branches in Fort Collins, Greeley and Boulder, three in the Denver area and one in Bear Valley.
AppleOne Service and AppleOne Franchise have also sued Keith and Richard Keith Enterprises in California state court.
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