“Every team got caught up with them,” one marketing maven says of former Citi Field signage fixure SpongeTech.com. “If it™s too good to be true, maybe it just is. You saw their product on TV, but I don™t ever remember seeing anyone who actually owned one. CNBC’s Darren Rovell considers the fate of SpongeTech and suggests franchises should’ve asked, “just how much is your marketing budget anyway and how does that compare to sales?
SpongeTech, the self-dubbed œSmarter Sponge, gained its fame through its infomercial plugs, but in the end, there were too many things that didn™t add up. It led to the SEC filing civil fraud charges against the company and its top two executives, Michael Metter and Steven Moskowitz. The FBI arrested them in May and they were charged with conspiracy to commit securities fraud and obstruction of justice. Metter’s lawyer told reporters that he denies the charges made against him. The public relations e-mail listed on SpongeTech™s Web site bounced back and two lawyers representing the company’s executives did not return calls seeking comment.
On Friday, as part SpongeTech™s bankruptcy filing, more than 100 creditors must declare themselves to the court along with the money that they are owed. A who™s who of sports teams are expected to line up for money they might never receive.
Lawsuits alone have shown us that Madison Square Garden (Knicks, Rangers) is owed $430,880 and the New York Mets received bounced checks totaling $300,000.
“We are acting to enforce our contractual rights through the courts, a Mets spokesperson told CNBC.
The New York Islanders are waiting for $405,000 and the New York Giants are hoping to recoup the $360,000 they were promised, which includes SpongeTech not paying for its suite food at games. Throw in the Chicago Bears™ lawsuit asking for $260,000 the team is owed and SpongeTech owes $1.4 million from just six teams.