A Cortlandt couple say they paid $239,000 for a Millwood sign franchise but was left with a shell of a business.
Journey Ink Inc., formed last year by Michelle and Neal Browne to buy a Signarama franchise, sued Joshua Cohen and Joco Signs LLC for fraudulent inducement, Sept. 17 in Westchester Supreme Court.
“Cohen represented that he was leaving the sign industry to pursue another career,” the complaint states, “when in reality he was covertly plotting to buy and operate a competing Signarama franchise in New Rochelle.”
Cohen, of Wappingers Falls, did not reply to a request for comment sent to the New Rochelle business.
Signarama opened its first store in 1986 in Farmingdale, Nassau County, and began franchising outlets in 1987. Now it has 380 locations in the U.S. and 270 internationally.
Snap Signs Inc. was formed in 2020 and operated under the assumed name, Signarama, in Millwood, according to state business records. Last year, Cohen incorporated Joco Signs, operating as Signarama, at the same address.
The Brownes claim that Cohen enticed them last December to buy Signarama – Millwood. He allegedly depicted the business as a turnkey operation and indicated that it had 6,000 customers, the complaint states.
For $192,500 plus a $39,500 franchise fee, the Brownes believed they would get all Joco assets used to operate a sign business.
They assumed Joco’s lease for a space in the Millwood building, according to the complaint, while unbeknownst to them Snap Signs Inc. was operating in the same building and controlled the internet technology servers.
After the deal closed on April 1, Snap Signs would not provide the code for the IT equipment, the complaint states, and Snap Signs held the lease for a large format printer that was supposed to be assigned to Journey Ink. As a result, the new business had to outsource work instead of producing it in-house.
Cohen allegedly failed to provide working printers, computers, a laminator, and other equipment, according to the complaint. And he did not transfer phone numbers and voice messages, email accounts, customers lists and contact information, social media accounts and vendor accounts that held artwork for customers.
Instead, Cohen allegedly diverted assets to Signarama – New Rochelle.
The Brownes say they would not have purchased the Millwood business if Cohen had disclosed a completing business 19 miles away in the same county.
In addition to the fraud charge, Journey Ink accused Cohen and Joco of breach of contract, misappropriation of trade secrets, and unfair competition.
The complaint does not name Signarama as a defendant or mention any role played by the franchiser in the alleged scheme.
Journey Ink is represented by White Plains attorney Arthur J. Muller III.
