Dataflow has every intention of retaining its current retail strategy, despite recently losing a court action against a former employee who told Harvey Norman the distributor was going direct over the Web.
Dataflow initiated legal action in the Federal Court against Scott Goodman for an e-mail he sent to Harvey Norman. The court found that although Goodman had engaged in deceptive and misleading conduct, because it was not for commercial or trade purposes it did not breach section 52 of the Trade Practices Act.
Justice Peter Hely concluded that although Goodman represented that Dataflow was going to go direct, even though "Dataflow had no such intentions", Goodman's act was more one of an "officious or mischievous bystander making a false accusation", than someone engaged in trade.
"All the facts in the e-mail were wrong," said Jeffrey Tobias, managing director of Dataflow. "The case was lost on a technicality rather than an issue of fact."
Goodman, who was with Dataflow from March to early May this year, sent an e-mail to 13 Harvey Norman stores and three members of the print media on May 22, including ARN.
He alleged that Dataflow was intending to bypass its tradit-ional retail ties in favour of a direct online strategy through a company called Software Ventures that Dataflow had registered on the previous Friday.
Goodman claimed that the company would trade as e*flow, with Dataflow already registering the Internet address e-flow.com.au.
"With Tony Gattari stating 'Deal direct and you're out!' what's he going to do when one of Australia's largest software disties goes direct . . . but Mr Tobias will swear black and blue and follow to the word that 'we're not going direct with Dataflow. Harvey Norman only deals with Dataflow not Software Ventures,'" Goodman claimed in the e-mail.
With Harvey Norman one of Dataflow's largest customers, the issue was particularly sensitive in light of the ret-ailer's recent decision to dump Compaq from its stores when it was revealed it was going to sell direct through its own outlets.
"Harvey Norman was getting stirred up by the e-mail but all the facts were wrong. Once they knew what was going on, everything was fine," Tobias said.
He also had to reassure Harvey Norman that Software Ventures had been part of the Dataflow group for eight years and Goodman's allegations of it being registered on the Friday prior to the e-mail being sent were completely untrue.
Justice Hely agreed. "It [Software Ventures] has not traded. It is not intended that it will undertake business activities, nor has it in fact done so."
Tobias dismissed other claims made in the e-mail, such as the statement: "But I spose that now, since DF has lost MS which will shrink at least 60 mill in sales, he has to find the $$$ somewhere and that's out of the pocket of each and every proprietor's cash register."
Tobias was in fact personally offended by the e-mail and had no idea why Goodman sent it. "He admits to sending it but I don't know why. He left Dataflow of his own volition and there was no animosity between either me and him or Dataflow in general and him."