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May 11, 2010 4:39 PMPublication: The East Hampton Press

Hamptons Online sues former publisher, seeking millions in damages

May 11, 2010 4:39 PM

Southampton-based Hamptons Online has filed a multimillion-dollar federal lawsuit against the former publisher of its website, Hamptons.com, which until last year was the region’s most visited internet destination.

Among other allegations in the lawsuit, the company is accusing Robert Florio of taking Hamptons.com’s proprietary computer source code and using it to create a competing website. The lawsuit also alleges copyright infringement, misappropriation of trade secrets, unfair competition, breach of fiduciary duty and defamation by implication. It also claims that Mr. Florio charged Hamptons Online for $100,000 in business expenses that he can’t substantiate, that he owes the company $54,000 in personal loans and advances, and that he transferred ownership of several web addresses—as well as a Volkswagen bus—from the company to his own name before he was fired.

Mr. Florio, a Shinnecock Hills resident who still owns 30 percent of Hamptons Online, was “terminated” from the company in September, according to the lawsuit, as Hamptons.com decided to dial back its news operation and return to being a social life website. Soon after, he started a new Southampton-based venture, VUE Master Media, which launched a news website, NorthForkVue.com, just four months after his departure from Hamptons.com. Just last week, the company followed up with the launch of HamptonsVue.com, also a news website, focusing on the South Fork.

“We are aware of the complaint and find no merit in any of Hamptons Online’s allegations,” Mr. Florio said in an e-mail Monday. “We will be filing our answers to the court in due time. On the advice of counsel, there will be no further comment on this matter until it is resolved in a court of law.”

The lawsuit also names as defendants former Hamptons.com employees Christine Bellini, who was the executive editor; Andrea Aurichio, a reporter; Matthew Cross, a web programmer; and Deborah Capone, a salesperson. All four now work for Mr. Florio and VUE Master Media, doing the same jobs they had at Hamptons.com.

Because NorthForkVue.com launched just four months after Hamptons Online terminated Mr. Florio’s employment, VUE Master Media could not have created the website from scratch without using Hamptons Online’s proprietary source code, according to the complaint.

“Our clients have good reason to believe that assets and computer source code were taken from it without authority and are now being used in a competing organization in an unlawful matter,” said Bryan C. Van Cott, an attorney representing Hamptons Online. “We’re going to do everything we can to protect and preserve our client’s rights.”

Hamptons.com was a coveted URL when it first appeared in the mid-1990s as a website focused on the South Fork. The existing Hamptons.com website launched in 2004, and its source code was edited and refined “through great effort and expense” for more than five years, and the website has also amassed a valuable database of advertisers, according to the complaint.

The lawsuit goes on to state that a line-by-line comparison of Hamptons.com’s public source code and NorthForkVue.com’s public source code confirms that there are identical lines of code between the two websites, and words and syntax unique to Hamptons.com that were clearly copied. NorthForkVue.com has also published articles and photographs that originally appeared on Hamptons.com, the lawsuit states.

“It’s about what’s right and what’s wrong—the company reclaiming assets that rightfully belong to it for the benefit of its employees and its business,” said Joe Kazickas, the leader of a partnership that holds majority ownership of Hamptons Online. He said Mr. Florio split from the company when they disagreed over curtailing Hamptons.com’s news operation.

“[The majority] came to a decision that trying to bring another news outlet into the marketplace didn’t make sense for us to do,” Mr. Kazickas said. “We weren’t equipped for it. The economics weren’t there. So we just decided that we would go in a different direction.”

According to the lawsuit, Mr. Florio’s employment at Hamptons Online was terminated on September 9, 2009.

Hamptons Online is now alleging that in the month before his departure, Mr. Florio transferred ownership of 22 website domain names and a Volkswagen bus from Hamptons Online to himself. Some examples of the domain names are hamptonsblack.com, teenhamptons.com, apexandcurves.com, bikerstylemag.com and hamptonsonsale.com.

Mr. Florio also made unauthorized copies of all of the password-protected information on Hamptons Online’s computers and servers and refused to turn over computer passwords when he left, the lawsuit states.

He also has outstanding loans and unsubstantiated business expenses that he refuses to repay or account for, Mr. Van Cott said. Hamptons Online reimbursed Mr. Florio for $359,050 in business expenses between 2007 and 2009, but he has never presented receipts to substantiate $100,000 of the charges, according to the lawsuit. He showed the company credit card bills, but no line-item receipts, Mr. Van Cott said. A significant portion of the $100,000 was spent on living expenses for Mr. Florio and his family, the lawsuit alleges.

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I have to say that Mr Florio has a great vision....creating Hampton.com (I thought it was a great site) and now HamptonsVue.com.
By Bel (86), southampton on May 12, 10 9:53 AM
Hmmm.. there could be some merit to this law suit. While the content is completely different, the look of the site is very similar..right down to the logo, and color scheme. To the former employees of hamptons.com now working for hamptonsvue.com, never burn bridges.
By pstevens (406), Wilmington on May 12, 10 10:21 AM
2 members liked this comment
Another classic case of me, myself and I.
By ride the truth wave (125), southampton on May 12, 10 10:51 AM
Thanks 27East for the info. The old Hamptons.Com has become so boring I stopped checking it. HanptonsVue is like the old site. I just miss the cams. They're still no match for 27East but occasionally give a different slant on issues.
By hamptonsnrcit (38), sag harbor on May 12, 10 11:28 AM
Theft of source code by departing employees is very common, suits like this would happen more often were they not so expensive to litigate. Must be some personal animosity here.
By Funbeer (204), Southampton on May 12, 10 6:39 PM
631politics.com (TwinFors.com) always got more page views than Hamptons.com BTW.
By Mr Suffolk (113), Twin Forks on May 12, 10 9:15 PM
Meant twinforks.com above. These lawsuits are for way too much money. The Island's best domain -- longisland.com -- recently sold for about $350,000. Hamptons.com can't be worth more than that.
By Mr Suffolk (113), Twin Forks on May 12, 10 9:23 PM
Spring is here. And with it comes the barnyard aromas that are concealed in winter by the need to keep the animals indoors.
By highhatsize (3298), East Quogue on May 12, 10 9:45 PM
dura lex sed lex
By nellie (451), sag harbor on May 12, 10 10:25 PM
1 member liked this comment
Rob Florio created hamptons online and hamptons.com. Now greedy investors are trying to claim what's rightfully his. I don't know all the facts but I do know that rob florio has been synonymous with hamptons online since the old BBS days in the early 90's. I assume way before there were any investors involved.
By local414 (10), southampton on May 13, 10 9:43 AM
I think that Ms. Aurichio that the employees of Hamptons.com “are just not nice people and do not do business honorably ...”
I know several advertiser that refused to go back to them, not because of their site, but because of their sales manager's attitude.

I wish the best of luck to Mr. Florio and I hope he ends up owning Hamptons.com in the retaliatory slander suit he should file, if he hasn't already...
By NandSforker (3), Ronkonkoma on May 13, 10 11:16 AM
There's a particular detail in this report that seems to say it all.

Mostly every employee of Hamptons.Com had stayed loyal to Mr. Florio and went with him to his new venture.

I wish Mr. Florio the very best of luck in all of his endeavors. He is one of best representatives of the East End.
By elliot (238), sag harbor on May 13, 10 11:51 AM
most every employee? you sure about that? check your facts. this isn't about being a representative either. it's about horribly misusing company funds. i would not put it past this guy whatsoever. he may charm but he's no business man.
By seawolf (3), Stony Brook on May 13, 10 2:06 PM
1 member liked this comment
I have no idea of the lawsuit's merit, but I just wanted to thank Rob Florio and the Hamptons Online BBS for encouraging my interests in computers as well as my peers, many who work in the industry today. This bulletin board service predated the modern internet and hopefully will remain a part of history on the east end. I fondly remember the days of logging in on my 1200 bps modem 15 years ago and when they changed from ANSI to RIP Script....The stories I'll tell my grandchildren (lol).
By Aspatuck Gardens (26), Westhampton Beach on May 13, 10 7:34 PM
1 member liked this comment
Like all things American, you need to read between the lines here. Rob is an honest, hardworking person who had the smarts, initiative,drive, ambition, talent and know how to revolutionize our ability to get news/culture/arts on the East End by just hitting Enter. Big egos get in the way and the brainchild gets chewed up and spit out. Don't forget who bore this baby. It was Rob and he deserves a lot of credit and support.
By pam (2), Southampton on May 13, 10 7:48 PM
Honest, hardworking person? Are you kidding? All this guy has ever done run around scamming people to invest in his businesses, which are poorly managed and don't make profits; i.e. Hamptons Telephone.

And apparently we are now learning, once he finds a sucker to help him out, he steals money, software, passwords, domain names and a VW bus? Come on. Honest??
By RealLocal (76), Bridgehampton on May 14, 10 1:19 PM
I concur with Pam. Rob was the vision behind Hamptons.com.

Its the same story as Kathleens/Tates. Investors getting in the way of someones vision.
By Draggerman (667), Southampton on May 15, 10 7:07 AM
What a joke. Screw vision. Somebody had a vision at Enron too, and you know what, they paid the price for misusing their power too. His vision was to live comfortably, to spend money that the investors didn't have, and that's what he did.
By traffic (26), Southampton on May 18, 10 6:21 PM
This comment has been removed because it is a duplicate, off-topic or contains inappropriate content.
By tuckahoetrip (46), Water Mill on May 13, 10 8:45 PM
Wow.. I did not know that Rob had sold off any part of Hamptons Online! And how he's being sued by them!?! How ironic! I guess it comes down to the contract he signed when he sold Hamptons Online and any non-compete clauses in that contract or his termination agreement, etc. Good luck Rob!
By Rich Morey (292), Brooklyn on May 13, 10 11:49 PM
Hamptonyte-DOT-blogspot has a hilarious take on this, but I sort of agree with RealLocal. Florio sounds sleazy and I can totally see him running off with unjustified expenses on the company account. That said, Hamptonyte blog's take on how Hamptons.com fired him for wanting to practice journalism is spot on!
By DrEngine (10), Brookhaven on May 14, 10 5:38 PM
This article is disgraceful. What has the press come to? Everything about this is wrong. Without Rob Florio hamptons.com would have never even neared being one of the top viewed sites in the region. He created that company and respect should be payed to him. "Unfair Competition"?? I wish the best of luck to Rob, hamptonsvue, and whatever other projects he is working on!
By hamptongirl (1), Southampton on May 14, 10 5:40 PM
I have known Robert Florio for over 10 years and have worked closely with him. He has always been an asset to our community, and for those of us who know him personally, we know him to have the utmost integrity. Cases such as this should not be tried in the Press, which is basically what you have done by publishing it. Remember, there are always two sides to every story. Hopefully the Press will dedicate the same amount of coverage when it is Robert's turn.
By seapuss (1), Southampton on May 16, 10 2:01 PM
1 member liked this comment
1/2 of these comments read like they were written by Rob Florio under 15 fake names but hey, who am I?
By cochise316 (58), southampton on May 17, 10 9:29 PM
1 member liked this comment
You wish.

Mr. Florio's hard earned reputation as being honest and smart precedes him.

He has many, many collegues, associates and friends in this area.

I predict that all will pan out in his favor- as it legally should.
By elliot (238), sag harbor on May 18, 10 4:38 PM
Cochise... LOL... Didn't want to go driving on the beach and now you are saying my posts are fake..... Funny.. I didn't know you posted on here...We are stopping by
By Aspatuck Gardens (26), Westhampton Beach on May 18, 10 9:44 PM
Sparkling Pools, Hot Tubs, repairs, construction, new, used