Spokane Soda dispute may spill into court

Two Spokane beverage distribution companies are clashing over the right to use the words “Real Soda” in their business name.

The owners of Real Soda-Spokane LLC have filed a lawsuit against the owner of a competing company launched this year with the name Real Soda of Spokane.

Both do the same thing — sell an assortment of bottled soda pop to retail outlets.

Stan Ashby and Roberta Reisdorf, the owners of Real Soda-Spokane, allege the competing company has caused significant loss of sales due to confusion and deception to customers.

The suit also names one of their former workers, David Dominick, and accuses him of wrongly taking business information and using it to help start the second business.

Dominick now works for Priscilla Holmstead, who he said is the sole owner of the new company, Real Soda of Spokane.

Reached Wednesday, Reisdorf said, “This has caused a great deal of confusion in the market and financial harm to us.” Reisdorf and Ashby have operated Real Soda-Spokane LLC since 2001.

Real Soda-Spokane, with offices and a small retail store at 715 E. Sprague, has seven employees and expects to become profitable this year, Reisdorf said. Sales are expected to reach $500,000, she said.

In September 2004, Dominick was hired by Ashby and Reisdorf as an independent contractor to develop sales.

In February of this year, the suit alleges, he told Ashby and Reisdorf he was going to open his own business.

In May, Holmstead filed a business license application with the state for Real Soda of Spokane, listing the company as a sole-proprietor business. The company has about 40 wholesale commercial accounts and operates from offices in the Spokane Business and Industrial Park, according to Dominick.

Dominick said on Wednesday that he did not illegally use information gained during his employment at Real Soda-Spokane. Dominick also denied assertions in the lawsuit that he made damaging and misleading remarks to customers about his former bosses, including a statement that Real Soda-Spokane was about to close.

Complicating the picture is an agreement that Holmstead signed earlier this year with Real Soda in Real Bottles, Ltd., a Torrance, Calif., company that licenses the use of the “real soda” name to local franchisees around the country.

Holmstead’s Spokane attorney, Geoff Swindler, said that formal agreement gave Real Soda of Spokane the exclusive right to use the name.

But attorney J. Michael Keyes, representing Ashby and Reisdorf, said that agreement is invalid and has no bearing on his clients and their use of the name Real Soda-Spokane.

He said the California company has not gone through the required steps to set up franchises in Washington state.

Since Ashby and Reisdorf have used the name for four years, they’ve established significant goodwill and should be allowed to protect their interests, he said.

Reisdorf said she signed a licensing deal with the California company in 2001, then ended it in 2003 because Real Soda-Spokane was not seeing any benefit from the relationship.

The California company had promised exclusive access to certain bottlers of soda pop, but that turned out not to be true, said Reisdorf.

While the two companies engage in the same kind of business, they rely mostly on different bottlers for their products. Dominick said Real Soda of Spokane gets all its products through the California company.

Real Soda of Spokane has placed its products in stores such as Tidymans, Albertsons and the Coeur d’Alene Resort, he said.

Reisdorf said Real Soda-Spokane acquires its bottled sodas from a range of producers, including a few of the same ones that Holmstead and Dominick use. Its retail customers include Rosauers, Huckleberry’s, and other stores between the Tri-Cities and Missoula, she said.

Her bottom-line concern, added Reisdorf, is that some customers think they’re buying from her company but aren’t.

“We have a very loyal following. People associate the name Real Soda with Stan and myself,” she added. “And we’ve heard them say they’re buying our product, when in fact they’re buying from the other company.”