In an e-mail to BRAIN, Donnell said Bike Baron, the website named in the suit, sells closeout inventory that does not conflict with the interests of Sinclair’s brick-and-mortar retail customers.
“Being forced to sell closeout inventory below cost, sometimes for 50 cents on the dollar or less at the end of the year, had become an unsustainable model. We offer the same inventory to retailers for substantially less than products are sold for on Bike Baron, but more often our retailers are little interested in closeout inventory,” Donnell said.
QBP is accusing Nevada-based Sinclair of using Bike Baron and an eBay site to sell directly to consumers while purporting to sell only through specialty retailers.
In the suit filed last month, QBP also alleges that Sinclair uses numerous images to promote products on Bike Baron and the eBay store that were created, copyrighted and watermarked by QBP.
Quality makes its product images available only to retailers who sign a subscription and licensing agreement with SmartEtailing, a company in which QBP owner Steve Flagg acquired a majority interest earlier this year. Further, the page title of the Bike Baron website reads “Quality Bike Parts,” which comes up in a Web search for Bike Baron, creating confusion about the source of the products.
Sinclair has also targeted its ad and sales efforts in Minnesota, where QBP is based, the suit says.
Donnell pointed out that he has nothing to gain by using a competitor’s photos, and that Sinclair has access to pictures of bike parts from its suppliers and an in-house studio.
“My partner and I certainly had no knowledge anything like that ever happened nor would we allow or condone it under any circumstances. We never received a demand letter and never even a phone call alerting us to their concern, or anything like that occurring would have been looked into and immediately stopped,” he said.
Donnell questioned QBP’s motives with the suit, referencing a situation four years ago when Ridley dropped Sinclair for QBP, after Donnell said Sinclair made the Belgium supplier the fastest growing bike brand in the U.S.
“We had invested a huge amount of money to build that brand. That is business and the risk of being a small distributor. But it strikes me as odd that QBP seems intent on injuring Sinclair after that occurred?” he said.
The Bike Baron site is still live, but no sales are being processed as it said the site was undergoing updates. The initial hearing in the case has not been scheduled.