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COVER STORY: Rhonda Byrne Lawsuit
Could the universe be restoring the balance against Rhonda Byrne, the former Melbourne TV producer behind the self-help phenomenon of The Secret? Richard Guilliatt investigates.
Excerpt from: The Weekend Australian Magazine The Other Secret August 23-24, 2008
Like many of her public utterances, the message that Australia’s platinum-haired self-help guru Rhonda Byrne sent out last November to her millions of followers was a rhapsodic outpouring of goodwill. Thanksgiving Day was approaching in the United States, where Byrne now lives in a Californian celebrity enclave just up the road from Oprah Winfrey’s 17-hectare, neo-Georgian estate, and the creator of the New-Age blockbuster The Secret wanted to remind the world about the crucial importance of gratitude.
“Remember,” Byrne wrote, “if you are criticising, you are not being grateful. If you are blaming, you are not being grateful. If you are complaining, you are not being grateful.”
Those are worthy sentiments, but it was an odd time for Byrne to be expressing them because her lawyers had just sued two of the very people who were instrumental in launching her book and film The Secret to phenomenal success. Drew Heriot, the Australian director of the movie, and Dan Hollings, an Arizona internet consultant whose “viral marketing” helped propel Byrne to global fame via Oprah, had both been demanding that Byrne pay them a share of the estimated $US300 million ($340 million) revenue they claim she’d promised them. In the weeks leading up to Thanksgiving, Byrne’s lawyers had counter-attacked by launching legal actions against both men in jurisdictions far from their homes, a tactic one judge has since described as vexatious and harassing.
For a woman whose central message is the power of positivity, Byrne has a surprisingly long history of such bust-ups, stretching back to her days as a television producer in Melbourne. But those past disputes pale next to the legal storms swirling around The Secret, a New-Age marketing phenomenon the like of which has not been seen for decades. It’s a bunfight of cosmic proportions that has drawn into its orbit some of the best-known figures and most fundamental tenets of the global self-help industry.
In The Secret, Byrne claimed to have uncovered the key to human happiness, which turned out to be a very simple principle called the “law of attraction” – the notion that if you focus on your desires, the universe will deliver them. And until recently its astonishing success – at least seven million books in print; a best-selling DVD released worldwide – seemed proof-positive of that very beneficence. But now the “most powerful law in the universe” seems to have gone awry, with Byrne’s own former associates accusing her of fraud and hiring platoons of lawyers to pick apart the business machinations behind The Secret.
If there’s a karmic backlash brewing, it’s one that even some alternative spiritual thinkers welcome. “If it is, that won’t be a bad thing,” says Paul Wilson, the Australian meditation teacher whose Calm books have become an international phenomenon. “Because the field you are talking about is New Age self-help, and there’s a lot of nonsense involved in it. A lot of it.”
Nothing is excluded from the law of attraction. Your life is a mirror of the dominant thoughts you think.
RHONDA BYRNE RARELY APPEARS in public now – her last major interview was with The New York Times a year ago, when she held court in her Santa Barbara apartment wearing a glittering silver circle glued to her forehead. Controversy was brewing at the time over the 57-year-old Australian’s falling-out with Esther Hicks, an American spiritualist who played a crucial role in an early version of The Secret but was subsequently edited out of the film. Not long after that interview Byrne moved into a large home in the nearby hills which has been her refuge as rumours gather about the hugely anticipated sequel to her creation.
In early May, however, Byrne emerged from seclusion when she turned up at a lawyer’s office in Los Angeles to give a videotaped deposition in her company’s lawsuit against Dan Hollings. What Byrne revealed in that deposition was remarkable if only for its all-enveloping fogginess, because over the course of two hours she professed to be almost wholly disconnected from the legal and financial details of the massive multi-million-dollar business she has spawned.
“I don’t control anything I create,” she told the lawyers, professing to have little grasp of the legal disputes in which she is embroiled. “I’m not aware of any of these things. I’m not involved.”
This is a very different-sounding Rhonda Byrne from the savvy and ambitious TV producer who worked the phones relentlessly as a producer at the Nine Network’s Midday show in the early ’90s, before going on to create a stream of reality-TV programs about UFO encounters, unsolved murders and near-death experiences. Even then she was an industry veteran, having worked as a producer on The Don Lane Show as far back as 1980. A single mother who was raising two daughters after separating from her second husband, Byrne impressed those around her as a woman of extraordinary focus.
“She knew exactly what was going on around her,” recalls TV producer Peter Wynne, her former boss at Midday’s Melbourne office. “She wasn’t ever caught napping, Rhonda.”
Emma McLean, who worked alongside Byrne at Midday, has claimed that the Nine Network fired both of them after they set up a sideline business in their office selling calorie-counting pedometers which had been featured on the show (they even sold one to Wynne). The two women promptly set up their own company, Prime Time Productions, and created the wildly successful World’s Greatest Commercials series, which led in turn to the reality programs Oz Encounters, Great Escapes and Sensing Murder. The pair were riding high – trips to Cannes and Los Angeles, shopping in Paris – until their relationship began to founder in messy arguments over money.
“She started saying, ‘I’m the creative person and they’re my ideas, therefore I should be getting more of the profit,’” McLean told The Sun-Herald last year. McLean said she agreed to a less equitable split but the partnership broke down in 2000 when she became pregnant and asked for time off; mediators were brought in, and Byrne eventually bought out McLean’s share of the company.
Interviewed for this article, McLean declined to comment further. “I’m not bitter and twisted … I don’t want to be perceived as someone who lets it worry me,” she says. “Certainly there is karma out there and it’s working big-time.”
According to the dramatic narrative of The Secret, it was four years later that Byrne was shattered by the sudden death of her father and the news that Prime Time was effectively bankrupt. In a story she later dramatised in her film, Byrne says her teenage daughter handed her a copy of the 1910 get-rich-quick classic The Science of Getting Rich, a book that led her to a deep immersion into self-help literature and the epiphany that most of these books sell the same message – that positive thoughts yield positive outcomes.
The full story of how Byrne turned that realisation into “the greatest success story in the annals of viral marketing” – to quote The American Spectator – is only now emerging in court papers filed in the US and Australia, and from interviews with the participants. To Byrne it’s the story of a small group of people bringing “joy to the world”; to some of those involved it’s a story of hypocrisy and ruthless double-dealing.
Having discovered the Grand Unifying Theory of the self-help movement, Byrne conceived the idea of making it into a TV series, and turned to a 25-year-old Melbourne director called Drew Heriot. Heriot had worked for Prime Time since 2000, and in early 2005 he began helping to refine the idea into a two-hour TV special. Byrne pitched it to executives from the Nine Network in early 2005, and by July Nine had agreed to stump up $600,000 for filming. Heriot himself contributed $10,000 and flew to the US with Byrne to begin a marathon series of interviews that would eventually incorporate about 60 of the world’s best-known spiritual gurus and self-development spruikers.
It was to be a whirlwind ride for the young director, who in the course of filming became a confirmed adherent of The Secret’s philosophical tenets, and remains so. It’s because of this belief that Heriot has only now agreed to break his silence to The Weekend Australian Magazine.
Now living in Los Angeles, Heriot recalls that early on Byrne promised him a percentage of the film’s profits, but rebuffed his request for a written contract. “Rhonda actually insisted that we not have a contract – she said they limited people’s freedom, that they’re designed to guard against things going wrong, which is not the way of The Secret because it is focusing on the negative,” he says. “That’s when I started to think, ‘This doesn’t feel right.’
“But by the same token, my company and Rhonda’s had worked together for several years, so I had come to trust her. She said we were going to share the abundance.”
For much of 2005, Heriot says he pushed aside his reservations as he poured his energies into the film, whose striking visual style – the medieval motifs, the dramatic re-enactments, and the technique of having each speaker talk directly to the camera – he claims to have devised. He recalls editing down 100 hours of interviews over several months, and says he was paid monthly fees which eventually totalled a “five-figure sum”.
In January 2006, executives from Nine watched the film and dropped a bombshell – they had decided against screening it. The indefatigable Byrne then decided to release it via the internet in the US, a high-risk strategy that was undertaken with the help of Dan Hollings, an Arizona-based internet consultant. Like Heriot, Hollings claims Byrne offered him a percentage of profits; in court filings he quotes an email from Byrne which allegedly promised him $8000 per month “plus a share of 10 per cent of gross margins of all revenues from The Secret website”.
“I had seen the trailer and it was remarkably well done,” says Hollings from his home in Tucson. “I said, ‘Holy cow, I don’t know what this is but it looks like it’s going to be good.’”
The Secret had no conventional advertising, and Hollings says he devised viral marketing techniques involving Google adverts and blogs, and also helped Byrne set up her online ordering and customer-support systems. In March 2006 the movie was launched as a teaser-download linked to a $US34.95 DVD, and within weeks it had taken off. Although no verifiable figures have been published, the film was reported to have grossed nearly $20 million in its first eight months.
The disputes about money began almost immediately. When Heriot emailed a request for payment to Byrne the day after the film’s release, she responded that he was being “unappreciative” and that they had “some serious thinking to do” – an exchange she has acknowledged in court filings. Hollings says he put in his claim for profit-share a few weeks later. “Money was flowing in incredibly well during that first month and I fully expected that, as agreed, I’d get paid the monthly percentage of revenues from the site from that point on,” he says. His court submissions allege that Byrne’s Chicago business office issued a succession of false assurances that the money would be forthcoming.
Unbeknown to both men, the corporate structure behind The Secret had changed dramatically, for in late 2005 Byrne had met the man who would become her business manager – Bob Rainone, a Chicago-based executive from the computer and internet industry. Rainone helped Byrne create a new corporate structure around her film and on April 11 they transferred the copyright to a Hungarian company which operated out of a lawyer’s office in Budapest.
COVER STORY: The Weekend Australian Magazine
Click for Rhonda Byrne Lawsuit Article Continued...
Excerpt from: The Weekend Australian Magazine The Other Secret August 23-24, 2008
Like many of her public utterances, the message that Australia’s platinum-haired self-help guru Rhonda Byrne sent out last November to her millions of followers was a rhapsodic outpouring of goodwill. Thanksgiving Day was approaching in the United States, where Byrne now lives in a Californian celebrity enclave just up the road from Oprah Winfrey’s 17-hectare, neo-Georgian estate, and the creator of the New-Age blockbuster The Secret wanted to remind the world about the crucial importance of gratitude.
“Remember,” Byrne wrote, “if you are criticising, you are not being grateful. If you are blaming, you are not being grateful. If you are complaining, you are not being grateful.”
Those are worthy sentiments, but it was an odd time for Byrne to be expressing them because her lawyers had just sued two of the very people who were instrumental in launching her book and film The Secret to phenomenal success. Drew Heriot, the Australian director of the movie, and Dan Hollings, an Arizona internet consultant whose “viral marketing” helped propel Byrne to global fame via Oprah, had both been demanding that Byrne pay them a share of the estimated $US300 million ($340 million) revenue they claim she’d promised them. In the weeks leading up to Thanksgiving, Byrne’s lawyers had counter-attacked by launching legal actions against both men in jurisdictions far from their homes, a tactic one judge has since described as vexatious and harassing.
For a woman whose central message is the power of positivity, Byrne has a surprisingly long history of such bust-ups, stretching back to her days as a television producer in Melbourne. But those past disputes pale next to the legal storms swirling around The Secret, a New-Age marketing phenomenon the like of which has not been seen for decades. It’s a bunfight of cosmic proportions that has drawn into its orbit some of the best-known figures and most fundamental tenets of the global self-help industry.
In The Secret, Byrne claimed to have uncovered the key to human happiness, which turned out to be a very simple principle called the “law of attraction” – the notion that if you focus on your desires, the universe will deliver them. And until recently its astonishing success – at least seven million books in print; a best-selling DVD released worldwide – seemed proof-positive of that very beneficence. But now the “most powerful law in the universe” seems to have gone awry, with Byrne’s own former associates accusing her of fraud and hiring platoons of lawyers to pick apart the business machinations behind The Secret.
If there’s a karmic backlash brewing, it’s one that even some alternative spiritual thinkers welcome. “If it is, that won’t be a bad thing,” says Paul Wilson, the Australian meditation teacher whose Calm books have become an international phenomenon. “Because the field you are talking about is New Age self-help, and there’s a lot of nonsense involved in it. A lot of it.”
Nothing is excluded from the law of attraction. Your life is a mirror of the dominant thoughts you think.
RHONDA BYRNE RARELY APPEARS in public now – her last major interview was with The New York Times a year ago, when she held court in her Santa Barbara apartment wearing a glittering silver circle glued to her forehead. Controversy was brewing at the time over the 57-year-old Australian’s falling-out with Esther Hicks, an American spiritualist who played a crucial role in an early version of The Secret but was subsequently edited out of the film. Not long after that interview Byrne moved into a large home in the nearby hills which has been her refuge as rumours gather about the hugely anticipated sequel to her creation.
In early May, however, Byrne emerged from seclusion when she turned up at a lawyer’s office in Los Angeles to give a videotaped deposition in her company’s lawsuit against Dan Hollings. What Byrne revealed in that deposition was remarkable if only for its all-enveloping fogginess, because over the course of two hours she professed to be almost wholly disconnected from the legal and financial details of the massive multi-million-dollar business she has spawned.
“I don’t control anything I create,” she told the lawyers, professing to have little grasp of the legal disputes in which she is embroiled. “I’m not aware of any of these things. I’m not involved.”
This is a very different-sounding Rhonda Byrne from the savvy and ambitious TV producer who worked the phones relentlessly as a producer at the Nine Network’s Midday show in the early ’90s, before going on to create a stream of reality-TV programs about UFO encounters, unsolved murders and near-death experiences. Even then she was an industry veteran, having worked as a producer on The Don Lane Show as far back as 1980. A single mother who was raising two daughters after separating from her second husband, Byrne impressed those around her as a woman of extraordinary focus.
“She knew exactly what was going on around her,” recalls TV producer Peter Wynne, her former boss at Midday’s Melbourne office. “She wasn’t ever caught napping, Rhonda.”
Emma McLean, who worked alongside Byrne at Midday, has claimed that the Nine Network fired both of them after they set up a sideline business in their office selling calorie-counting pedometers which had been featured on the show (they even sold one to Wynne). The two women promptly set up their own company, Prime Time Productions, and created the wildly successful World’s Greatest Commercials series, which led in turn to the reality programs Oz Encounters, Great Escapes and Sensing Murder. The pair were riding high – trips to Cannes and Los Angeles, shopping in Paris – until their relationship began to founder in messy arguments over money.
“She started saying, ‘I’m the creative person and they’re my ideas, therefore I should be getting more of the profit,’” McLean told The Sun-Herald last year. McLean said she agreed to a less equitable split but the partnership broke down in 2000 when she became pregnant and asked for time off; mediators were brought in, and Byrne eventually bought out McLean’s share of the company.
Interviewed for this article, McLean declined to comment further. “I’m not bitter and twisted … I don’t want to be perceived as someone who lets it worry me,” she says. “Certainly there is karma out there and it’s working big-time.”
According to the dramatic narrative of The Secret, it was four years later that Byrne was shattered by the sudden death of her father and the news that Prime Time was effectively bankrupt. In a story she later dramatised in her film, Byrne says her teenage daughter handed her a copy of the 1910 get-rich-quick classic The Science of Getting Rich, a book that led her to a deep immersion into self-help literature and the epiphany that most of these books sell the same message – that positive thoughts yield positive outcomes.
The full story of how Byrne turned that realisation into “the greatest success story in the annals of viral marketing” – to quote The American Spectator – is only now emerging in court papers filed in the US and Australia, and from interviews with the participants. To Byrne it’s the story of a small group of people bringing “joy to the world”; to some of those involved it’s a story of hypocrisy and ruthless double-dealing.
Having discovered the Grand Unifying Theory of the self-help movement, Byrne conceived the idea of making it into a TV series, and turned to a 25-year-old Melbourne director called Drew Heriot. Heriot had worked for Prime Time since 2000, and in early 2005 he began helping to refine the idea into a two-hour TV special. Byrne pitched it to executives from the Nine Network in early 2005, and by July Nine had agreed to stump up $600,000 for filming. Heriot himself contributed $10,000 and flew to the US with Byrne to begin a marathon series of interviews that would eventually incorporate about 60 of the world’s best-known spiritual gurus and self-development spruikers.
It was to be a whirlwind ride for the young director, who in the course of filming became a confirmed adherent of The Secret’s philosophical tenets, and remains so. It’s because of this belief that Heriot has only now agreed to break his silence to The Weekend Australian Magazine.
Now living in Los Angeles, Heriot recalls that early on Byrne promised him a percentage of the film’s profits, but rebuffed his request for a written contract. “Rhonda actually insisted that we not have a contract – she said they limited people’s freedom, that they’re designed to guard against things going wrong, which is not the way of The Secret because it is focusing on the negative,” he says. “That’s when I started to think, ‘This doesn’t feel right.’
“But by the same token, my company and Rhonda’s had worked together for several years, so I had come to trust her. She said we were going to share the abundance.”
For much of 2005, Heriot says he pushed aside his reservations as he poured his energies into the film, whose striking visual style – the medieval motifs, the dramatic re-enactments, and the technique of having each speaker talk directly to the camera – he claims to have devised. He recalls editing down 100 hours of interviews over several months, and says he was paid monthly fees which eventually totalled a “five-figure sum”.
In January 2006, executives from Nine watched the film and dropped a bombshell – they had decided against screening it. The indefatigable Byrne then decided to release it via the internet in the US, a high-risk strategy that was undertaken with the help of Dan Hollings, an Arizona-based internet consultant. Like Heriot, Hollings claims Byrne offered him a percentage of profits; in court filings he quotes an email from Byrne which allegedly promised him $8000 per month “plus a share of 10 per cent of gross margins of all revenues from The Secret website”.
“I had seen the trailer and it was remarkably well done,” says Hollings from his home in Tucson. “I said, ‘Holy cow, I don’t know what this is but it looks like it’s going to be good.’”
The Secret had no conventional advertising, and Hollings says he devised viral marketing techniques involving Google adverts and blogs, and also helped Byrne set up her online ordering and customer-support systems. In March 2006 the movie was launched as a teaser-download linked to a $US34.95 DVD, and within weeks it had taken off. Although no verifiable figures have been published, the film was reported to have grossed nearly $20 million in its first eight months.
The disputes about money began almost immediately. When Heriot emailed a request for payment to Byrne the day after the film’s release, she responded that he was being “unappreciative” and that they had “some serious thinking to do” – an exchange she has acknowledged in court filings. Hollings says he put in his claim for profit-share a few weeks later. “Money was flowing in incredibly well during that first month and I fully expected that, as agreed, I’d get paid the monthly percentage of revenues from the site from that point on,” he says. His court submissions allege that Byrne’s Chicago business office issued a succession of false assurances that the money would be forthcoming.
Unbeknown to both men, the corporate structure behind The Secret had changed dramatically, for in late 2005 Byrne had met the man who would become her business manager – Bob Rainone, a Chicago-based executive from the computer and internet industry. Rainone helped Byrne create a new corporate structure around her film and on April 11 they transferred the copyright to a Hungarian company which operated out of a lawyer’s office in Budapest.
COVER STORY: The Weekend Australian Magazine
Click for Rhonda Byrne Lawsuit Article Continued...
Categories: Law of Attraction
Rhonda Byrne and The Secret Lawsuit
Dan Hollings Complaint With Rhonda Byrne And The Secret LLC
Dan Hollings v. Rhonda Byrne et al
Case: ilndce 1:2008cv04369
Cause: 28:1332 Diversity-Breach of Contract
Filed: 07/31/2008
Excerpted From Complaint Filed In Federal Civil Court
COMPLAINT Dan Hollings, Plaintiff in the above-styled action, files this Complaint against Defendants Rhonda Byrne, TS Production, LLC, The Secret, LLC (aka TS Holdings, LLC) TS Production Holdings, LLC, TS Merchandising, Ltd., and Prime Time U.S., Inc. (hereinafter collectively referred to as “Defendants”), alleging as follows:
FACTUAL BACKGROUND Defendant Rhonda Byrne is the creator, author and producer of “The Secret”, a film that has been viewed by millions around the world. The Secret has also been released as a book with more than seven million copies in print. Upon information and belief, Defendant Byrne owns all or a significant portion of Defendant Prime Time Productions, an Australia-based film and television company. Prime Time Productions produces films in multiple cities across the world including Melbourne, Chicago, Austin, and Los Angeles. In 2005, Mr. Hollings began negotiations with Rhonda Byrne and her company, Prime Time Productions, to perform Internet strategy and marketing services that included oversight and direct involvement in the creation, maintenance, support and operation of websites for the project known as The Secret (collectively, “The Secret Website”), as well as the Internet marketing strategies to support The Secret.
Ms. Byrne represented that she was in the course of producing a movie called The Secret and solicited Mr. Hollings’ help in designing and setting up the website and overseeing Internet activities such as Internet strategy, marketing, customer support, fulfillment and programming for The Secret’s website. In September of 2005, Mr. Hollings and Ms. Byrne reached an agreement under which Mr. Hollings was retained to provide creative and marketing services necessary for the establishment of a website and related marketing channels that were a vital component of The Secret strategy, advertising, production and sales campaign that were to follow. Mr. Hollings was chosen by Ms. Byrne based on his reputation, experience, and his unique skill set and ability to provide a substantial platform that would assist in the roll-out and sales of The Secret movie and related products in a manner that would maximize the revenue captured by the program. Far from just providing basic website development, the strategy, marketing and platform established and implemented by Mr. Hollings was integral to Ms. Byrne’s efforts to establish a multi-million dollar product in a world-wide consumer market. Mr. Hollings’ Internet strategy and services provided the primary means by which customers were introduced to and sold the various products offered at The Secret website. Mr. Hollings’ services were specifically acknowledged by Defendant Byrne in The Secret book. The Secret marketing campaign and marketing pages were launched in March 2006 and The Secret web site was launched along with the release of The Secret movie in late August 2006. Millions of people have viewed The Secret film since the Internet marketing campaign began in March 2006. The book The Secret, became a #1 New York Times bestseller and has more than 7.5 million copies in print. According to its website, The Secret film and book have been translated into many languages for audiences around the world.
The terms of the agreement between Mr. Hollings and Defendant Byrne are memorialized in a series of email correspondence which sets forth Defendant Byrne’s desire to maximize the profit potential surrounding this project and the amount of revenues that could be captured through the web-based marketing campaign.
In her email correspondence to Mr. Hollings, Defendant Byrne and Prime Time Productions promised to pay Mr. Hollings, “US$8,000.00 per month to broadcast plus a share of 10% of gross margins of all revenues from The Secret website. The revenues you will receive from this, in fact, will exceed the Nine Network’s revenues as they have 10% of Prime Time’s net profits, which will come after your share.” A true and correct copy of the email correspondence between Mr. Hollings and Defendant Byrne is attached hereto as Exhibit A.
Following the negotiations between Mr. Hollings and Defendant Byrne and Defendant Prime Time Products, Defendant Byrne established Defendant TS Merchandising to handle certain business matters related to The Secret’s website. Plaintiff Hollings performed all work asked and required of him on The Secret website, including Internet strategy and development and implementation of the marketing campaign pursuant to his agreement with Defendants. Further, in order to perform his obligations under the contract, Defendant was forced to put aside other clients and opportunities so that he could designate adequate time to The Secret website, Internet strategy and marketing. In April, 2006, after the website’s launch, Mr. Hollings sent an invoice to TS Merchandising requesting his 10% share of the gross margins pursuant to the terms of his agreement with Ms. Byrne and Prime Time Productions. Following April, 2006, The Secret sent numerous communications assuring Mr. Hollings that his portion of the gross margin would be forthcoming. Defendant went so far as to instruct Mr. Hollings to set up an LLC for the purpose of receiving the large sum of money.
Defendants have failed to pay Mr. Hollings the agreed upon percentage of the gross margin which he is due pursuant to his agreement with Defendants; an amount which is now believed to be in excess $3,000,000.00.
COUNT I - BREACH OF CONTRACT Plaintiff realleges the allegations in paragraphs 1 through 23 of this Complaint as if set forth here verbatim.
The agreement between Plaintiff and Defendants forms a binding contract between the parties for which Defendants have received valuable consideration. Defendants’ failure to pay Plaintiff’s 10% portion of the gross margin constitutes a breach of the contract between the parties.
As a direct and proximate result of Defendants’ breach, Plaintiff has suffered damages in the amount of at least $250,000.00 plus interest and costs.
COUNT II-FRAUDULENT INDUCEMENT Plaintiff realleges the allegations in paragraphs 1 through 26 of this Complaint as if set forth here verbatim.
Defendants induced Plaintiff to perform work for The Secret website by falsely representing either orally, in writing or by implied conduct, that they would pay him 10% of gross margin for his work. Defendants induced Plaintiff to set aside other clients and business opportunities by falsely representing either orally, in writing or by implied conduct, that they would pay him 10% of gross margin for his work. Defendants’ representations were false and Defendants knew them to be false. Defendants, through Rhonda Byrne and Robert Rainone, were well aware that they would not pay Plaintiff the percentage of gross margin which they had fraudulently promised.
At all times relative hereto, Plaintiff reasonably believed Defendants’ representations, was unaware of the true concealed facts, and justifiably relied upon Defendants’ representations by performing work on The Secret’s website and setting aside other clients and opportunities in order to complete his performance under the contract.
If Plaintiff had known the true facts, Plaintiff would not have performed the work on The Secret’s Website and would not have set aside other clients and opportunities in order to perform work for Defendants.
As a proximate result of Defendants’ fraud and deceit, Plaintiff has suffered general and special damages in an amount to be proven at trial in excess of $250,000.00.
Upon information and belief, Defendants are guilty of oppression, fraud and malice towards him. Therefore, in addition to actual damages, Plaintiff is entitled to recover punitive damages from Defendants, for the purpose of punishing Defendants and deterring it and others from engaging in such actions in the future.
COUNT III - UNJUST ENRICHMENT Plaintiff realleges the allegations in paragraphs 1 through 34 of this Complaint as if set forth here verbatim.
Plaintiffs has performed services for Defendant for which Defendant has failed to compensate Plaintiff and Defendant has been unjustly enriched thereby.
Defendant has maintained money which is due and owing to Plaintiff and to which Plaintiff is entitled and Defendant has been unjustly enriched thereby. Plaintiff has repeatedly demanded that Defendant remit payment of the amounts owed by Defendant to Plaintiff.
Defendant has failed, refused and continues to refuse to pay the amount due and owing to Plaintiff, thereby resulting in damages to Plaintiff in the amount to be proven at trial, plus interest, attorney fees and costs pursuant to the terms of the Programs.
COUNT IV - UNFAIR COMPETITION UNDER CALIFORNIA BUSINESS AND PROVISIONS CODE
Plaintiff realleges the allegations in paragraphs 1 through 40 of this Complaint as if set forth here verbatim.
Defendants, and each of them, are “persons” as defined under California Business and Professions Code § 17021.
By engaging in the above-described practices and actions, Defendants have committed one or more acts of unfair competition within the meaning of California Business & Professions Code § 17200, et seq. Under these statutes, “unfair competition” means an unlawful, unfair or fraudulent business act or practice. This conduct as alleged is actionable pursuant to Business & Professions.
See also Rhonda Byrne & The Secret, LLC Sued By Drew Heriot & Drew Pictures Pty LTD
Case: ilndce 1:2008cv04369
Cause: 28:1332 Diversity-Breach of Contract
Filed: 07/31/2008
Excerpted From Complaint Filed In Federal Civil Court
COMPLAINT Dan Hollings, Plaintiff in the above-styled action, files this Complaint against Defendants Rhonda Byrne, TS Production, LLC, The Secret, LLC (aka TS Holdings, LLC) TS Production Holdings, LLC, TS Merchandising, Ltd., and Prime Time U.S., Inc. (hereinafter collectively referred to as “Defendants”), alleging as follows:
FACTUAL BACKGROUND Defendant Rhonda Byrne is the creator, author and producer of “The Secret”, a film that has been viewed by millions around the world. The Secret has also been released as a book with more than seven million copies in print. Upon information and belief, Defendant Byrne owns all or a significant portion of Defendant Prime Time Productions, an Australia-based film and television company. Prime Time Productions produces films in multiple cities across the world including Melbourne, Chicago, Austin, and Los Angeles. In 2005, Mr. Hollings began negotiations with Rhonda Byrne and her company, Prime Time Productions, to perform Internet strategy and marketing services that included oversight and direct involvement in the creation, maintenance, support and operation of websites for the project known as The Secret (collectively, “The Secret Website”), as well as the Internet marketing strategies to support The Secret.
Ms. Byrne represented that she was in the course of producing a movie called The Secret and solicited Mr. Hollings’ help in designing and setting up the website and overseeing Internet activities such as Internet strategy, marketing, customer support, fulfillment and programming for The Secret’s website. In September of 2005, Mr. Hollings and Ms. Byrne reached an agreement under which Mr. Hollings was retained to provide creative and marketing services necessary for the establishment of a website and related marketing channels that were a vital component of The Secret strategy, advertising, production and sales campaign that were to follow. Mr. Hollings was chosen by Ms. Byrne based on his reputation, experience, and his unique skill set and ability to provide a substantial platform that would assist in the roll-out and sales of The Secret movie and related products in a manner that would maximize the revenue captured by the program. Far from just providing basic website development, the strategy, marketing and platform established and implemented by Mr. Hollings was integral to Ms. Byrne’s efforts to establish a multi-million dollar product in a world-wide consumer market. Mr. Hollings’ Internet strategy and services provided the primary means by which customers were introduced to and sold the various products offered at The Secret website. Mr. Hollings’ services were specifically acknowledged by Defendant Byrne in The Secret book. The Secret marketing campaign and marketing pages were launched in March 2006 and The Secret web site was launched along with the release of The Secret movie in late August 2006. Millions of people have viewed The Secret film since the Internet marketing campaign began in March 2006. The book The Secret, became a #1 New York Times bestseller and has more than 7.5 million copies in print. According to its website, The Secret film and book have been translated into many languages for audiences around the world.
The terms of the agreement between Mr. Hollings and Defendant Byrne are memorialized in a series of email correspondence which sets forth Defendant Byrne’s desire to maximize the profit potential surrounding this project and the amount of revenues that could be captured through the web-based marketing campaign.
In her email correspondence to Mr. Hollings, Defendant Byrne and Prime Time Productions promised to pay Mr. Hollings, “US$8,000.00 per month to broadcast plus a share of 10% of gross margins of all revenues from The Secret website. The revenues you will receive from this, in fact, will exceed the Nine Network’s revenues as they have 10% of Prime Time’s net profits, which will come after your share.” A true and correct copy of the email correspondence between Mr. Hollings and Defendant Byrne is attached hereto as Exhibit A.
Following the negotiations between Mr. Hollings and Defendant Byrne and Defendant Prime Time Products, Defendant Byrne established Defendant TS Merchandising to handle certain business matters related to The Secret’s website. Plaintiff Hollings performed all work asked and required of him on The Secret website, including Internet strategy and development and implementation of the marketing campaign pursuant to his agreement with Defendants. Further, in order to perform his obligations under the contract, Defendant was forced to put aside other clients and opportunities so that he could designate adequate time to The Secret website, Internet strategy and marketing. In April, 2006, after the website’s launch, Mr. Hollings sent an invoice to TS Merchandising requesting his 10% share of the gross margins pursuant to the terms of his agreement with Ms. Byrne and Prime Time Productions. Following April, 2006, The Secret sent numerous communications assuring Mr. Hollings that his portion of the gross margin would be forthcoming. Defendant went so far as to instruct Mr. Hollings to set up an LLC for the purpose of receiving the large sum of money.
Defendants have failed to pay Mr. Hollings the agreed upon percentage of the gross margin which he is due pursuant to his agreement with Defendants; an amount which is now believed to be in excess $3,000,000.00.
COUNT I - BREACH OF CONTRACT Plaintiff realleges the allegations in paragraphs 1 through 23 of this Complaint as if set forth here verbatim.
The agreement between Plaintiff and Defendants forms a binding contract between the parties for which Defendants have received valuable consideration. Defendants’ failure to pay Plaintiff’s 10% portion of the gross margin constitutes a breach of the contract between the parties.
As a direct and proximate result of Defendants’ breach, Plaintiff has suffered damages in the amount of at least $250,000.00 plus interest and costs.
COUNT II-FRAUDULENT INDUCEMENT Plaintiff realleges the allegations in paragraphs 1 through 26 of this Complaint as if set forth here verbatim.
Defendants induced Plaintiff to perform work for The Secret website by falsely representing either orally, in writing or by implied conduct, that they would pay him 10% of gross margin for his work. Defendants induced Plaintiff to set aside other clients and business opportunities by falsely representing either orally, in writing or by implied conduct, that they would pay him 10% of gross margin for his work. Defendants’ representations were false and Defendants knew them to be false. Defendants, through Rhonda Byrne and Robert Rainone, were well aware that they would not pay Plaintiff the percentage of gross margin which they had fraudulently promised.
At all times relative hereto, Plaintiff reasonably believed Defendants’ representations, was unaware of the true concealed facts, and justifiably relied upon Defendants’ representations by performing work on The Secret’s website and setting aside other clients and opportunities in order to complete his performance under the contract.
If Plaintiff had known the true facts, Plaintiff would not have performed the work on The Secret’s Website and would not have set aside other clients and opportunities in order to perform work for Defendants.
As a proximate result of Defendants’ fraud and deceit, Plaintiff has suffered general and special damages in an amount to be proven at trial in excess of $250,000.00.
Upon information and belief, Defendants are guilty of oppression, fraud and malice towards him. Therefore, in addition to actual damages, Plaintiff is entitled to recover punitive damages from Defendants, for the purpose of punishing Defendants and deterring it and others from engaging in such actions in the future.
COUNT III - UNJUST ENRICHMENT Plaintiff realleges the allegations in paragraphs 1 through 34 of this Complaint as if set forth here verbatim.
Plaintiffs has performed services for Defendant for which Defendant has failed to compensate Plaintiff and Defendant has been unjustly enriched thereby.
Defendant has maintained money which is due and owing to Plaintiff and to which Plaintiff is entitled and Defendant has been unjustly enriched thereby. Plaintiff has repeatedly demanded that Defendant remit payment of the amounts owed by Defendant to Plaintiff.
Defendant has failed, refused and continues to refuse to pay the amount due and owing to Plaintiff, thereby resulting in damages to Plaintiff in the amount to be proven at trial, plus interest, attorney fees and costs pursuant to the terms of the Programs.
COUNT IV - UNFAIR COMPETITION UNDER CALIFORNIA BUSINESS AND PROVISIONS CODE
Plaintiff realleges the allegations in paragraphs 1 through 40 of this Complaint as if set forth here verbatim.
Defendants, and each of them, are “persons” as defined under California Business and Professions Code § 17021.
By engaging in the above-described practices and actions, Defendants have committed one or more acts of unfair competition within the meaning of California Business & Professions Code § 17200, et seq. Under these statutes, “unfair competition” means an unlawful, unfair or fraudulent business act or practice. This conduct as alleged is actionable pursuant to Business & Professions.
See also Rhonda Byrne & The Secret, LLC Sued By Drew Heriot & Drew Pictures Pty LTD
Categories: Law of Attraction
