Charis Et Al v. Betti Sands COMPLAINT

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MISSOURI

EASTERN DIVISION

CHARIS MINERALS, INC., )

CRISTOL ENTERPRISES, LLC, )

CHRISTOPHER CRISTEA, and )

DAVID C. TOLLE, )

)

Plaintiffs, )

)

v. ) Case No. 4:11-CV-01065

)

BETTINA MILNER-SPENCER SANDS, )

a/k/a BETTI SANDS, ) JURY TRIAL DEMANDED

)

Defendant. )

COMPLAINT

COME NOW Plaintiffs Charis Minerals, Inc. (“Charis”), Cristol Enterprises, LLC

(“Cristol”) and Christopher Cristea and David C. Tolle (the “Individual Plaintiffs”) (collectively,

“Plaintiffs”), and state the following for their Complaint against Defendant Bettina Milner-

Spencer Sands, a/k/a Betti Sands (“Defendant”):

Nature of the Lawsuit

1. Plaintiffs file this Complaint to seek redress against Defendant for her fraudulent

and deceptive acts that misappropriated Charis’s and Cristol’s identity and intellectual property

in violation of state and federal law. Defendant has engaged in a calculated campaign – on the

one hand, falsely accusing the principals of Charis and Cristol of criminal and fraudulent conduct

while, on the other hand, falsely associating herself with Charis and Cristol by the unauthorized

use of the CHARIS and CRISTOL trademarks – to deceive potential investors of these

companies and to divert business to Defendant and entities she controls.

Case: 4:11-cv-01065 Doc. #: 1 Filed: 06/14/11 Page: 1 of 15 PageID #: 1

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2. By using the CHARIS and CRISTOL trademarks to deceive people about the

source of the message, Defendant engaged in blatant efforts to deceive the public as to her

association with Charis and/or Cristol. Defendant’s acts caused Plaintiffs to incur significant

monetary damages to respond to Defendant’s deception and resulted in reputational harm to

Plaintiffs. Plaintiffs bring statutory claim claims against Defendant pursuant to the Lanham Act

and common law claims for false association, defamation, and tortious interference with business

expectancy.

Jurisdiction and Venue

3. Charis is a corporation organized and existing under the laws of the Republic of

Liberia, with its principal place of business in Liberia. Charis maintains an office in St. Charles,

Missouri.

4. Cristol is a Nevada limited liability company whose sole members are individual

citizens of Missouri and Utah. Cristol maintains an office in St. Charles, Missouri.

5. Christopher Cristea is a resident and citizen of St. Charles County, Missouri.

6. David C. Tolle is a resident and citizen of St. Charles County, Missouri.

7. Defendant is an individual residing in Ocala, Florida. At times relevant to the

claims herein, Defendant has acted in her own name and in the name of an entity she controls,

New World Partnership.

8. This Court has jurisdiction over the Defendant because she is subject to personal

jurisdiction in Missouri pursuant to the Missouri long-arm statute, MO. REV. STAT. § 506.500.

The claims asserted against Defendant all arise from the commission of intentional torts within

this District. The torts alleged herein were expressly directed toward Charis, Cristol and the

Individual Plaintiffs, whose residences and/or places of business are located in Missouri, and the


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injury caused by Defendant’s intentional conduct is felt in Missouri. Defendant directed a

number of her deceptive communications to Missouri residents. Additionally, on information

and belief, Defendant has entered into agreements with residents of Missouri and has engaged in

the transaction of business in Missouri with Missouri residents, and this lawsuit arises in part

from those contacts with Missouri.

9. This Court has subject matter jurisdiction over Counts I - II of this Complaint

under 15 U.S.C. § 1125 and Counts III-V under the doctrine of supplemental jurisdiction, 28

U.S.C. § 1367.

10. As detailed above, Plaintiffs reside in the Eastern District of Missouri, and

Defendant has been engaged in the wrongful conduct complained of herein which has been

directed into the Eastern District of Missouri, making venue proper in this District and Division

under 28 U.S.C. §1391(b).

Charis and its Business and Trademarks

11. Charis was formed in 2010. Charis is engaged in the exploration and

development of certain minerals and mineral assets in Liberia and elsewhere. The Individual

Plaintiffs are shareholders, officers, and directors of Charis, and they manage the day-to-day

affairs of the company.

12. Defendant has never been a director, officer, employee, representative, or agent of

Charis, and has never been authorized to use the name and/or trademarks of Charis or to conduct

business for or on behalf of Charis.

13. The pertinent Articles of Incorporation of Charis list the Individual Plaintiffs and

one other individual who resides in Liberia as the sole shareholders.


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14. Charis is the owner of the trademarks CHARIS and CHARIS MINERALS.

CHARIS and CHARIS MINERALS have been continuously used in connection with Charis’s

products and services since the company was formed. Consumers have come to associate the

CHARIS and CHARIS MINERALS trademarks with Charis.

15. Charis is the owner of the following logo, in which Charis holds valid and

enforceable common law trademark rights:

16. Charis’s marks are known to the trade as indicating Charis as the source or

affiliated source with which the marks are used. Charis invested significant time, money and

resources developing its trademarks and its name. The marks and goodwill associated therewith

constitute valuable property of Charis.

Cristol and its Business and Trademarks

17. Cristol was founded in 2009 and is engaged in the business of exploration,

discovery, and development of domestic and international mineral projects.

18. The Individual Plaintiffs are members and managers of Cristol. Defendant has

never been a member, manager, officer, employee, representative, or agent of Cristol, and has

never been authorized to use the name and/or trademarks of Cristol or to conduct business for or

on behalf of Cristol.

19. Cristol is the owner of the trademarks CRISTOL and CRISTOL ENTERPRISES.

CRISTOL and CRISTOL ENTERPRISES have been continuously used in connection with


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Cristol’s products and services since the company was formed. Consumers have come to

associate the CRISTOL and CRISTOL ENTERPRISES trademarks with Cristol.

20. Cristol is the owner of the following logo, in which Cristol holds valid and

enforceable common law trademark rights

21. Critstol’s marks are favorably known to the trade as indicating Cristol as the

source or affiliated source with which the marks are used. Cristol invested significant time,

money and resources developing its trademarks and its name. The marks and goodwill

associated therewith constitute valuable property of Cristol.

Plaintiffs’ Interactions with Defendant

22. In or about October, 2010, Plaintiffs were introduced to Defendant through

Defendant’s association with Leonard Kragness of Sinoe Mining Corporation, which was

involved in various mineral development projects in Liberia. Defendant told Plaintiffs that she

had over $700,000 invested in Liberia for development of an alluvial gold project under the

auspices of Mr. Kragness. Defendant offered to assist Plaintiffs identify potential investors and

partners interested in Plaintiffs’ domestic and international mineral projects. Defendant

represented that she had significant contacts and personal relationships in Liberia and elsewhere

that would be valuable to Plaintiffs and that she could deliver potential investors and business

partners to Plaintiffs. Defendant also promised that her contacts in Liberia would produce

millions of dollars’ worth of diamond purchasing opportunities.


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23. Defendant’s representations about her investments, contacts, qualifications and

abilities were untrue. Defendant did not have funds invested in Liberia and did not have contacts

in Liberia that could assist Plaintiffs and their business enterprises as she had represented. While

Defendant provided certain information to Plaintiffs in preparation for a trip to Liberia, it became

quickly apparent to Plaintiffs that Defendant was not qualified or capable of providing the

assistance that she claimed she could. Defendant did not render any services that were of any

value or use to Plaintiffs.

24. At the time she was engaged to assist Plaintiffs, Defendant had been listed as a

prospective shareholder in Charis; however, Defendant never consummated her shareholder

interest in Charis and therefore never became an actual shareholder of the company. Defendant

is not a shareholder of Charis and holds no position with Charis (and never has).

25. Defendant’s actions and her false representations to Plaintiffs have damaged

Plaintiffs as detailed herein and have caused Plaintiffs to lose valuable business opportunities

and investors.

Defendant’s Identity Theft and False Association with Charis and Cristol

26. In April, 2011, Plaintiffs ceased interactions with Defendant. Unbeknownst to

Plaintiffs, and without any authority or permission, Defendant began using the names and marks

of Charis and Cristol in a blatant effort to try to steal the identity of these companies and divert

opportunities for herself and her own interests. At the same time, Defendant began a campaign

to spread false statements about the Individual Plaintiffs – all in an attempt to divert business to

herself in the guise that she was “principal” or associate of Charis and Cristol.

27. Specifically, beginning in February, 2011, Defendant entered into an agreement

with a Missouri resident, Donna Andres (“Andres”), wherein Defendant and Andres developed a


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purported business plan and investment offering in the name of Charis. The plan, called the

“Charis Gold Summary,” used the name and marks of Charis and purported to be sent on behalf

of Charis. With this fake business plan, Defendant and Andres simultaneously distributed a

solicitation for humanitarian assistance for Africa. Defendant and Andres indicated that this

humanitarian assistance was going to be conducted through a “501(c)(3)” entity, New World

Partners.

28. The representations in the “Charis Gold Summary” and the humanitarian

solicitation were false. New World Partners is not a tax-exempt entity, and Defendant and

Andres did not have an actual gold project. Neither Charis nor any of the Plaintiffs authorized

the development or dissemination of the business plan; nor did they have any knowledge of

Defendant’s actions.

29. Defendant’s fake business plan listed herself as a “principal” of Charis and her

phone number as the means of contacting Charis.

30. Using information they had gained from working with Plaintiffs, Defendant and

Andres disseminated the “Charis Gold Summary” business plan and the solicitation for

humanitarian assistance to actual business partners and prospective investors of Charis.

Attached hereto as Exhibit A is a true and accurate copy of the email and its attachments sent to

actual Charis prospective business partners in March, 2011. Defendant continues to this day in

her efforts to solicit business in the name of Charis.

31. At or about the same time Defendant was representing herself to be a

representative and principal of Charis, she was also attempting to conduct business in the name

of Cristol. Defendant gained access to an actual, confidential business plan of Cristol and began

disseminating that business plan to potential investors of Cristol. Defendant used the


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confidential information, name and marks of Cristol in an attempt to divert business

opportunities to herself. Neither Cristol nor any of the Plaintiffs authorized the dissemination of

the confidential business plan by Defendant; nor did they have any knowledge of Defendant’s

actions.

32. On information and belief, Defendant has been engaged in other communications

and solicitations in the names of Charis and Cristol, and her efforts to try to cloak herself in the

names of these entities continues.

Defendant’s Attempted Extortion of Plaintiffs

33. Beginning on or about April 22, 2011, Defendant began an effort to extort funds

from Plaintiffs by threatening to issue a press release that contained defamatory, false and

deceptive statements at a time when Defendant knew potential investors were in Liberia meeting

with Charis personnel.

34. Defendant had an individual named “Jerry Anderson” pose as a reporter or

disinterested third party. Plaintiffs are unsure whether Mr. Anderson exists or whether this was

simply a pseudonym used by Defendant. Mr. Anderson sent a communication via e-mail to the

Individual Plaintiffs indicating that information in an attachment entitled “Charis Minerals Inc.

Diamond Project: Please be aware” would be released to the press in Liberia. Attached hereto

as Exhibit B is a true and accurate copy of the email communication chain with “Jerry

Anderson” and the attachment.

35. The attachment from “Mr. Anderson” claims that Charis Minerals Inc. has a

partner “who is filing a fraud and theft suit in Liberia and the United States” against the Plaintiffs

“for concealing financial materials and mismanaging corporate records.” Defendant further

accused Plaintiffs of “false pretenses,” “fraud,” “larceny” and unspecified “crime.”


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36. Defendant and “Mr. Anderson” threatened publicly disclosing the allegations of

criminal conduct in an effort to extort monies from Plaintiffs: “You have Investors arriving, they

will have our information. Our full data will go to the key newspapers in Liberia. I urge you to

settle with Bettina immediately, or face the full press. We have no need for further

communication. Jerry.”

37. Defendant demonstrated her intimate involvement this effort to extort Plaintiffs

using the false and fraudulent information in the attachment sent by Mr. Anderson. Defendant

stated to Plaintiffs: “Good luck with the Investors. I will make sure Jerry’s paper is on hold, it

would be a shame if this came out in the papers while the Investor’s are in town. The Diamond

project needs their support. B.” See Exhibit C, email from Defendant dated April 22, 2011.

38. Plaintiffs did not accede to Defendant’s extortionate demands, so Defendant then

pursued another course of conduct to try to publicly humiliate and defame Plaintiffs.

Defendant’s Further Defamatory Statements about Plaintiffs

39. Beginning on or about May 20, 2011, Defendant began disseminating an email

entitled “Financial dissolution – Legal Actions pending – Cristea” to dozens of government

officials, investors, prospective investors and others. Attached hereto as Exhibit D is a true and

accurate copy of the email and the attachment entitled “Recital.”

40. In the “Recital” and the email, Defendant accused the Individual Plaintiffs of

“fraud” and “illegal event[s].” The information contained in these communications was false and

was designed again to try to extort funds from Plaintiffs. Defendant sought payment from

Plaintiffs for an “invoice,” which itself contained false information and was not an actual invoice

for any services that Defendant provided to Plaintiffs.


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41. Defendant continues to claim that she is responsible for the development of

Charis Minerals and that she is an “associate” or representative of Charis Minerals. Defendant

continues to send communications to investors and prospective investors (in Missouri and

elsewhere) for Charis and Cristol and to make misrepresentations to them. Defendant’s false

representations have caused damage to Plaintiffs’ reputation and to their goodwill and have

caused confusion in the marketplace.

42. On or about June 13, 2011, Defendant contacted an investor in Cristol and falsely

informed him that she was “gathering information for the FBI” relating to “embezzlement and

fraud charges” pertaining to the Individual Plaintiffs and their business operations.

COUNT I FALSE ASSOCIATION UNDER 15 U.S.C. §1125

43. Plaintiffs restate and incorporate by reference their allegations contained in

paragraphs 1-42 of this Complaint.

44. The representations made by Defendant that she is an “associate” or

representative of Charis and Cristol are false and misleading.

45. Defendant’s representations that she has a business association with Charis and

Cristol are false and misleading.

46. Defendant’s false and misleading misrepresentations were made in interstate

commerce in connection with the offering of alleged investment opportunities.

47. Charis, Cristol and the other Plaintiffs do not desire to be associated with

Defendant. Her continuing representations that she has a leadership role and/or is in any way

affiliated with Charis and Cristol are false.

48. Defendant’s false statements are a violation of §43(a) of the Lanham Act, 15

U.S.C. §1125(a), in that they were and are likely to cause confusion, or to cause mistake, or to


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deceive as to the affiliation, connection, or association of Defendant with Plaintiffs, or as to the

origin, sponsorship, or approval of his or her goods, services, or commercial activities by

Plaintiffs.

49. Defendant’s false statements further are a violation of §43(a) of the Lanham Act,

15 U.S.C. § 1125(a), in that they are being used in commercial advertising or promotion, and

misrepresent the nature, characteristics, qualities, or geographic origin of Plaintiffs’ goods,

services or commercial activities.

50. Defendant’s false representations have caused and, unless restrained by this

Court, will continue to cause irreparable injury and damage to Charis and Cristol.

51. Defendant has willfully and intentionally made these false representations.

52. Plaintiffs have no adequate remedy at law.

COUNT II TRADEMARK INFRINGEMENT UNDER 15 U.S.C. §1125


Paragraphs 1-52 of this Complaint.

54. Charis and Cristol have established common law rights in their marks through

long and continuous use of the marks in connection with mineral exploration, development, and

services related thereto.

55. Defendant has and continues to use CHARIS and CRISTOL in interstate

commerce in connection with Defendant’s offering of certain services.

56. Through the use of CHARIS and CRISTOL, Defendant has created a likelihood

of confusion regarding the origin or source of the services being provided.

57. The use by Defendant of CHARIS and CRISTOL, infringes on Plaintiffs’

common law rights in these marks, in violation of §43(a) of the Lanham Act, 15 U.S.C.


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§1125(a), in that such use is likely to cause confusion, or to cause mistake, or to deceive as to the

affiliation, connection or association as to the Defendant’s sponsorship or approval by Charis and

Cristol.

58. Defendant has caused and, unless restrained by this Court, will continue to cause,

irreparable injury and damage to Charis and Cristol.

59. Defendant’s injury to Plaintiffs has been willful and intentional.

60. Plaintiffs have has no adequate remedy at law.

COUNT III COMMON LAW VIOLATIONS



62. Defendant’s use of CHARIS and CRISTOL trademarks violates their common

law rights in these marks.

63. Defendant’s use of CHARIS and CRISTOL trademarks has caused and, unless

restrained by this Court, will continue to cause serious and irreparable injury and damage to

Charis and Cristol.

64. Defendant’s use of CHARIS and CRISTOL trademarks has been and is willful

and intentional.

65. Plaintiffs have no adequate remedy at law.

COUNT IV DEFAMATION




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67. Defendant’s statements regarding the Individual Plaintiffs are defamatory, in that

they state or reasonably imply that the Individual Plaintiffs are or have been (a) engaged in

financial fraud and deception, (b) engaged in larceny and other criminal conduct, (c) accused by

third parties and authorities of financial fraud and other misconduct, and/or (d) incompetent and

unethical in their business dealings.

68. Defendant’s statements are false.

69. Defendant lacked reasonable grounds for these statements or alternatively

Defendant published these statements with knowledge of their falsity or reckless disregard for

their truth or falsity.

70. These statements damaged the Individual Plaintiffs’ reputation and caused

Plaintiffs to lose business opportunities.

COUNT V TORTIOUS INTERFERENCE WITH BUSINESS EXPECTANCY



72. Defendant was aware of a business expectancy for Plaintiffs – specifically

acquiring additional investors and capital for Charis and Cristol.

73. Without justification, Defendant sent false and defamatory statements to potential

investors of Charis and Cristol and thereby unreasonably interfered with Plaintiffs’ business

expectancy.

74. Defendant threatened and has continued to threaten publicity of false and

defamatory statements about Plaintiffs to investors or prospective investors in an effort to extort

funds from Plaintiffs.

75. As a direct result of Defendant’s conduct, Plaintiffs have been damaged.


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PRAYER FOR RELIEF

WHEREFORE, Plaintiffs respectfully request that the Court enter judgment against

Defendant as follows:

A) That this Court declare that the representations made by Defendant described

herein are false and in violation of Section 43 of the Lanham Act, 15 U.S.C. § 1125(a).

B) That this Court declare that Defendant has without permission made use in

commerce of CHARIS and CRISTOL trademarks in violation of Section 43 of the Lanham Act,

15 U.S.C. § 1125(a).

C) That this Court declare that Defendant has without permission made use in

commerce of CHARIS and CRISTOL trademarks in violation of their common law rights in

these marks.

D) That this Court preliminarily and permanently enjoin Defendant, her officers,

agents, servants, affiliates, employees, attorneys and representatives and all those in privity or

acting in concert with her from directly or indirectly representing that she is an “associate” or

representative of Charis or Cristol or that she has any other business affiliation with Charis or

Cristol.

E) That this Court preliminarily and permanently enjoin Defendant, her officers,

agents, servants, affiliates, employees, attorneys and representatives and all those in privity or

acting in concert with her from any unauthorized use of CHARIS or CRISTOL trademarks.

F) That this Court preliminarily and permanently enjoin Defendant from engaging in

any advertising or publicity that purports to be on behalf of Charis or Cristol.

G) That this Court require Defendant to pay Charis and Cristol all of their litigation

expenses, including reasonable attorneys’ fees, as required by 15 U.S.C. §1117(a).


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H) That this Court award Plaintiffs their actual damages.

I) That this Court provide for such other and further relief as the Court may deem

just and proper.

Respectfully submitted,

THOMPSON COBURN LLP

By: /s/ Christopher M. Hohn

Christopher M. Hohn, #44124MO

Matthew A. Braunel, #50711MO

One US Bank Plaza, Suite 2600

St. Louis, Missouri 63101

314-552-6000

FAX 314-552-7000

Attorneys for Plaintiffs


Documents

Charis Et Al v. Betti Sands COMPLAINT