Legal Lemons, PR Lemonade
Inc., June, 2007 by Mike Hofman
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Tom Szaky knew that March 6 was going to be a big day for TerraCycle. His Trenton, New Jersey-based company was close to securing $2 million in private equity. In a few short years, TerraCycle had managed to get its organic plant food product (made from worm castings, which is to say, poop) on the shelves in Wal-Mart and Home Depot .
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Now, just at the start of the lawn care industry's busy spring season, Szaky had struck a deal with JH Partners, a California fund that has backed such fast-rising ventures as Peet's Coffee & Tea and Design Within Reach . But instead of a final term sheet--or, better yet, a check--what ultimately landed on Szaky's desk was a 173-page lawsuit. And it wasn't just any lawsuit: TerraCycle was being sued by Scotts Miracle-Gro , its largest competitor, for false advertising and trade dress violations. Specifically, Scotts said that ...
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