Sarasota’s Jordan Fishman, 71, offers fellow business owners some sobering advice: Don’t trust anyone.

 

The president of Sarasota–based Alpha Mining Systems, a global manufacturer of industrial and specialized mining tires, says he put his trust in Sam Vance, an employee he had known for more than 20 years and someone he had considered a close friend. “Sam was always a good guy,” Fishman says. “He worked hard. He was smart. I knew his first wife and his son, and I knew his second wife and his daughter since before she was born. Sam was like family.”

Earlier this year, Sarasota Circuit Court Judge Robert McDonald Jr. ordered Vance to pay Alpha $59 million in compensatory and exemplary damages for willfully and maliciously misappropriating the company’s trade secrets, including copyrighted tire and wheel blueprints, pricing information and customer lists. The order is one of the largest trade secret judgments in Florida history.

Vance, who is facing arrest for failing to appear in court, is also barred from working in the underground mining business anywhere in the world and is required to pay Alpha’s attorney’s fees. Vance is believed to be in China working in the underground mining business in defiance of the court order.

The saga leading up to the judgment is enough to make anyone who owns a business take Fishman’s advice to heart.

Fishman started his underground mining tire and wheel manufacturing business in Chicago in 1977. Vance joined the company as a salesman and quickly moved up to district manager, then marketing manager, then sales manager for the entire U.S. market. In 1987, Fishman sold the Chicago operations and moved to Sarasota, where he re-established the company with Sarasota as a base of operations. Vance decided to go into business for himself, buying and selling tires. According to Fishman, Vance’s business failed, and he was looking for a job. In 1989, Fishman rehired Vance to oversee international sales and marketing at Alpha.

Alpha’s products are unique. The company develops, manufactures and markets underground mining tires designed by Fishman. Because they enable users to carry a tremendous load in the confined spaces of underground mines, the tires consist of never-before-produced, contain novel ply ratings, a patent-pending design, distinct markings and a unique rim guard design. No other entity in the world produces or sells Alpha’s designs or tire sizes; or, rather, no one did prior to Vance’s activities.

Fishman knew that in order to protect his business he would need to keep certain information close to the vest. His copyrighted tire blueprints were kept under lock and key. He limited access to the patent pending designs to the factory in China that produced the tires and to Sam Vance.

Customer list and pricing information were also kept under wraps. One tire can sell for as much as $6,000 and it wouldn’t do for the company’s factories and customers to get wind of Alpha’s margin. So Fishman established a seemingly foolproof system that kept buying and selling prices and customer lists separate. Of course, Vance, as marketing manager, had access to this information.

Vance’s scheme began in China at the Guizhou Tire Company (GTC), which produced Alpha’s designs. Vance had secretly invited an Australian outfit, a customer of Alpha’s, to visit the factory, and had convinced the Chinese that if they sold the tires directly to the customer, GTC could offer the tires at a bargain price while reaping a significant profit. For his trouble, Vance would require a substantial selling commission. After all, he was the man with the customer list and the pricing information. GTC bit and began selling Alpha’s tires factory direct to Alpha’s customers at a bargain price.

Over a three-year period, Alpha lost $15 million in profits as a result of Vance’s turning over trade secret information to GTC. Early on, though, GTC had cut Vance out of the deal.

Since GTC was no longer willing to work with him, Vance branched out. Armed with Alpha’s blueprints, customer lists and pricing information, he approached the Dubai-based Al Dobowi Group and offered to assist them with developing an underground mining tires and wheels division. Al Dobowi is now manufacturing Alpha tires in China and supplying them to Alpha’s customer base. One of Alpha’s biggest customers moved its orders to Al Dobowi, resulting in lost profits of $3 million.

Fishman says the case against Vance was just the first step in reclaiming his business. He met with Al Dobowi officials in 2006 to convince them to do the right thing. “I took the blueprints and all the intelligence we had collected on Vance’s actions at the time and flew to Dubai. I wanted them to know what their employee was up to, what he had done,” Fishman says. “I spent three or four days in Dubai. They couldn’t have been better hosts, but they told me they had spent a million and a half dollars developing this business already. The thought process was, what are you going to do to me in Dubai? Well, we’ll see what we do to them in Dubai.”

While the victory in court provides some vindication, Fishman wonders if he will ever recover from the betrayal.

“You can’t believe what you feel,” he says. “You feel like somebody has come in and just taken your heart out. It’s like somebody came into your house and stole your wife and kids and the dog. That’s the feeling you get, like somebody came in and stole everything that you’ve done your entire life. It’s wrong. It’s just so wrong.”