Unreported / Non-Citable
Background
In August 2023, The Ridge Wallet LLC and Mosaic Brands, Inc., doing business as Storus, tried to settle litigation over competing smart wallet designs pending in district court and the International Trade Commission. Ridge was to pay $350,000, and Mosaic was to stop making, selling or offering for sale the Released Products by October 1, 2023, while remaining free to sell Permitted Mosaic Products depicted in an Appendix B. Mosaic signed one version on August 11, and Ridge signed a different version, with a different Appendix B, on August 14. Ridge wired the money, the district court case was dismissed, and the parties moved to end the ITC case as to Mosaic.
After October 1, Ridge believed Mosaic's Amazon and Storus listings still showed Released Products. It sued for breach of contract in November 2023 and obtained a temporary restraining order in December, but the court declined a preliminary injunction. When the competing versions surfaced, the parties agreed no binding contract existed and dropped their contract-based claims. They stipulated to a bench trial in October 2025 on Ridge's Lanham Act false advertising and unjust enrichment claims against Mosaic and Mia and Scott Kaminski, and on Mosaic's counterclaims for abuse of process and unfair competition, which alleged that Ridge hid material facts to obtain the restraining order.
The Court’s Holding
The order is a set of findings and conclusions after a bench trial, not an entered judgment. The court concluded Ridge is entitled to restitution of the full $350,000 from Mosaic. Mosaic received the payment for a contract that proved unenforceable, and Mosaic failed to establish unclean hands, estoppel or any equitable offset. Removing inventory did not count because Mosaic kept advertising the Released Products, which the court read as a single duty to leave the market. The redesign was something Mosaic wanted anyway, and its claimed cost of over $500,000 had no documentary support. Dismissal of the earlier litigation had no offset value because no binding releases exist, and the Kaminski prior art affidavit earned no credit because he denied authorizing it.
Ridge's Lanham Act claim failed. Ridge did not prove the Ridge silhouette signifies Ridge, offered no survey or expert evidence of materiality, and its investigator was not misled and knew he bought a Storus product from a site aimed at promotional dealers. The Faire.com listing was not in evidence, and testimony that Mosaic does not control that wholesaler was unrebutted. Ridge also showed no injury, because the $350,000 payment was not profits from sales of misadvertised products. The court found for Mia and Scott Kaminski on any claims pleaded against them, since Ridge offered no basis for individual liability.
Mosaic's counterclaims also failed. Filing redacted TRO papers without a sealed unredacted version was procedurally improper, but Ridge had no ulterior purpose, since it sought to enforce a term it believed binding and the redacted cure period applied only to Permitted Products. The unfair competition claim was barred by the litigation privilege of Civil Code section 47(b), which the court raised on its own, and it failed independently because the claimed lost sales of $348,801 and compliance costs were unsubstantiated. The parties must meet and confer and lodge a proposed judgment within 14 days that also disposes of the abandoned contract claims.
Key Takeaways
- A payer can recover money paid under a settlement that both sides agree never became binding, but the payee may seek an equitable offset for value actually conferred.
- Offsets require proof, and uncorroborated redesign costs for a change the payee wanted anyway earned no credit.
- Lanham Act false advertising plaintiffs must prove materiality, likely deception and injury tied to the statement, and an investigator who was not misled does not suffice.
- The litigation privilege can bar unfair competition claims based on court filings, and this court applied it without a request from Ridge.
- No judgment has been entered yet, and the order does not address costs or any future patent action Ridge has mentioned.
Why It Matters
This district court order follows a bench trial and is unreported, so it carries no precedential weight beyond persuasive value. It illustrates how a settlement undone by mismatched signed versions unwinds in equity: the party who paid recovers its money, and the party who kept it must document any value it conferred.
It also shows the evidentiary demands of a Lanham Act false advertising claim and the breadth of California's litigation privilege, even where the filing at issue, here redacted TRO papers, was procedurally flawed. Open items include entry of judgment, and whether Ridge pursues the patent claims the failed settlement was meant to resolve.