A high court judge has urged the warring directors of a Queenstown digital media business to resolve their dispute outside the courts.
It was apparent David Akal, Nahuel Lukomski and Lucas Marin failed to get proper legal and commercial advice when they formed the company in 2020, Justice McHerron said.
The trio did not plan for "what might happen if their business relationship fell apart".
With Akal and Lukomski’s relationship with Marin having "disintegrated", the pragmatic solution was a commercial negotiation in which one faction bought out the other, he said.
The decision is the second by the court in the past 12 months as Akal and Lukomski have attempted to seize back control of the business from their erstwhile partner.
The judgements reveal Mediaflow’s turbulent history since the pair conceived the venture four years ago to provide digital photo and video recording systems for tourism operators in the region, including Shotover Jet and Oxbow Adventure Co.
They asked Marin, a software engineer, to join them, and the trio incorporated Mediaflow in mid-2020 as equal shareholders and directors.
The partnership began to sour the following year, particularly between Akal and Marin, the latter restricting the former’s access to the company’s software and source code.
The relationship breakdown prompted Akal and Lukomski to resign as directors in 2022, leaving Marin to run the business on his own.
After getting legal advice, they used their majority control to reinstate themselves in June last year.
They then applied to the High Court for an interim injunction to limit the amount of salary Marin could withdraw from the company.
The pair alleged he had failed to properly authorise a salary increase he had granted himself, and breached their ownership rights to the company’s intellectual property — its software and source code.
In the first decision 12 months ago, Justice Rachel Dunningham dismissed the application and adjourned the matter, saying Marin needed an opportunity to respond.
As the dispute dragged on into this year, Marin resigned as a director and employee in July, claiming constructive dismissal.
That prompted a fresh interim injunction application by Akal and Lukomski, who claimed Marin had continued to shut them out of the business.
His resignation email, in which he said he would work as a contractor for $130 an hour, was an attempt to "hold the company to ransom" because he had not given them the access they needed to support their customers and run the business, the pair alleged.
They sought orders for Marin to repay the company some of the salary he had paid himself, and to grant them access to the company’s software, source code and online services.
In the latest decision, Justice McHerron declined to make a ruling on the salary issue.
Mediaflow’s profitability had continued to grow over the period Marin was running the business by himself, and it could be argued the company had gained full value from his work.
That dispute would need to be tested at a trial, unless the parties settled the dispute sooner.
However, Akal and Lukomski had produced enough evidence about the company’s intellectual property to justify an interim injunction, he said.
Marin’s recent actions had been "detrimental" to the company, and at least one client turned its back on the business.
He ordered Marin to relinquish full access to the company’s online services, and prohibited him from using the source code, software and other applications for any purpose other than for Mediaflow business.
— Guy Williams, PIJF court reporter
