It all seemed to start innocently enough. Marko Princip wanted $1,500 to fund a YouTube channel. This he got from David Moss—in exchange for a promise to allow Moss to participate in the decisions relating to the channel and to pay Moss 30% of the revenues generated from the channel. Fortunately for Princip, the channel took off. From that small initial investment of $1,500 in May 2012, the channel quickly grew into a revenue generating machine that took in funds at the rate of approximately $600,000 per year. Unfortunately for Princip, he broke the partnership agreement, paying Moss less than $20,000 of the much larger percentage that he had promised.
Moss attempted to work through the situation without involving the courts, but to no avail. Eventually he filed a complaint in Texas seeking over $1 million dollars in damages (Case No. 3:14-cv-03088 in the United States District Court for the District of Texas). He claimed that Princip had breached their partnership agreement and that Princip, as a partner, had breached his fiduciary duty to deal with Moss loyally, fairly, honestly, and openly. Moss also accused Princip of fraud. The parties couldn’t work out a settlement and the case went to a jury on March 28, 2016. On April 1, the jury found Princip liable for over $6 million in damages to Moss.
One lesson here is simple:
Partnership contracts mean something.
They ought to be honored, and partners ought to deal with one another in a way that is loyal, fair, honest and open. If a partner won’t do this, he or she can be held accountable.
Another lesson here is also simple:
Fraud can be expensive.
Of the jury’s multi-million dollar judgment against Princip, $3 million was for Princip’s fraud alone.