Top 40 firm alphabroder (asi/34063) says it’s been stiffed.

The third-largest supplier in the promotional products industry has filed a lawsuit that alleges that the entity previously known as Teespring and the new firm that owns the brand owes alphabroder $633,172 in unpaid invoices for products provided.

The Trevose, PA-headquartered supplier’s case is one of at least seven lawsuits brought in 2023 against the former Teespring. In another case, Disrupt Industries, Inc., a supplier that does business as Disrupt Sports (asi/49946), has also sued Teespring.

A Complicated Past

Founded in 2011 by Brown University students, Teespring was an online platform in which people could create custom designs to be placed on stock products like T-shirts and hoodies, which could then be marketed and sold. Teespring would do the fulfillment.

The firm was not without controversies over the years, with critics charging that the company failed to do enough to prevent merch promoting racism and violence from being sold on its platform.

In 2021, Teespring rebranded as Spring, but the new name didn’t stop problems the company was experiencing. Insider reported that Spring was struggling mightily, including mass layoffs in 2022 and complaints from creators that payouts were being delayed and that product quality was dropping. Toward the end of 2022, Amaze Holding Company, a subsidiary of Amaze Software, Inc., acquired an undisclosed amount of Spring’s assets.

“Spring, as a company, still exists but has been effectively defunct since the asset sale,” Insider reported on Sept. 11, 2023. “Amaze has taken over running its merch platform, which is now branded ‘Spring by Amaze.’”

Promo Cases

But after certain of Spring’s assets were acquired, the company allegedly left bills unpaid – and the commitments in the invoices have not yet been met, according to multiple lawsuits.

Filed in the Superior Court of California, alphabroder’s lawsuit names Teespring, Amaze and Teespring Co-Founder Walker Williams as defendants. The supplier says that between Feb. 2, 2015, and Nov. 1, 2022, it provided Teespring with $633,172 worth of “clothing and apparel goods” but was never paid.

Alphabroder wants the money it says it’s owed, as well as attorney fees and interest at the rate of 18% per annum from Nov. 1, 2022. As of this writing, no ruling had been made. A case-management conference is scheduled for Oct. 25. Alphabroder told ASI Media that it does not wish to comment on the lawsuit.

Global shipping company DHL is the latest business to sue creator merch company Spring (formally Teespring). This is the startup’s seventh (7) lawsuit in 2023 https://t.co/nW22dJPGMf

— Amanda Perelli (@arperelli) September 8, 2023

Meanwhile, in a separate case, Disrupt Sports won a total judgement of $2,321. A California Superior Court judge ruled in late August that the supplier, which has a presence in the United States, United Kingdom and Australia, was owed that money for custom-printed yoga mats it had provided Teespring. The judgement was against Teespring, Inc.

However, it may be difficult to collect, in part because of it being unclear if Spring/Teespring would have the means to pay and because of the acquisition by Amaze.

On the latter point, an attorney who is an expert in mergers and acquisitions, Michael Curtiss, told Insider that in an asset acquisition deal, “the acquirer can specify which assets and liabilities they are willing to assume, and typically, the seller remains a legal entity and is still beholden to its liabilities.”

The alphabroder lawsuit seems to have anticipated this.

It argues that Amaze should be held liable as it’s the natural successor to Teespring/Spring. There’s a “unity of interest” between Teespring and Amaze such that “any individuality and separateness between them has ceased, that each of said defendants is the alter ego of the other defendant in that each defendant corporation was undercapitalized and was completely controlled, dominated and managed by the other defendant for their own convenience and benefit, and that adherence to the fiction of the separate existence of each defendant would sanction fraud and promote injustice.”

The alphabroder suit continues: “Amaze should be deemed the alter-ego of (Teespring) … and thereby liable for all debts owed” to the Top 40 supplier.

More Than $1.5 Million in Claims

Across the seven known suits filed against Teespring/Spring this year, plaintiffs say they’re owed more than $1.5 million combined. Alphabroder’s claim of more than $633,000 is the largest.

Beyond alphabroder and Disrupt, Insider reported that other plaintiffs include delivery provider DHL (claim of $448,281), customer experience platform Narvar, Inc. ($88,405), Atradius Trade Credit Insurance ($333,995), accounting/advisory/consulting firm Effectus Group LLC ($40,457), and former employee Ty Huls, who alleges he hasn’t been paid the full $397,904 judgement due to him from a final judgement he won against Spring in 2021. Additionally, a tax warrant filed by the Washington State Department of Revenue resulted in a judgement of $14,687.

In a statement to Insider, Amaze didn’t respond directly to the lawsuits but said in part: “The Amaze Software team is dedicated to helping Creators sustainably monetize their audiences. In addition to building features and services in-house, we continue to look for acquisition and partnership opportunities that currently or have the potential to contribute to our mission.”