Case Background
JB Brothers, Inc., doing business as Poke Bar, operated a franchise system for Poke Bar Dice & Mix restaurants and franchised more than 70 locations. In 2017, JB Brothers signed a licensing agreement with Jaewoo Chung that allowed him to open a Poke Bar restaurant in Hawaii. Chung set up Mymulgogi, Inc. on February 15, 2017, and the restaurant, called Poke Bar Lewers, opened at 216 Lewers Street in Honolulu that October. The agreement ran for a ten-year term. It required a one-time $25,000 licensing fee and monthly royalties of 6% of gross sales once sales crossed $30,000 a month. The agreement also carried a confidentiality clause and barred Chung from opening a competing poke restaurant while he held a Poke Bar location, and for two years afterward within 20 miles of any Poke Bar unit.
In 2020, Chung and JB Brothers discussed opening a second restaurant in Waikiki. On January 26, 2021, Chung introduced Kyungjin Kang to JB Brothers' Hawaii representative, Chris Lim, during a golf outing. Kang asked whether he needed to sign a franchise agreement to open his own poke restaurant, and Lim told him he did. Kang then registered Tropic Ohana, Inc. on January 4, 2021, and opened a competing restaurant called Tropic Poke in Kapolei, Hawaii. JB Brothers said it did not learn until 2024, through a published news article, that Chung allegedly held a secret ownership stake in Tropic Poke while Kang allegedly held one in Poke Bar Lewers. Lim confronted Chung about the Tropic Poke ownership interest on July 12, 2022, and Chung told him he no longer wanted to open the planned second Poke Bar location.
Cause
JB Brothers accused Chung, Mymulgogi, Kang, and Tropic Ohana of breaching the licensing agreement and misusing its proprietary recipes, trade secrets, and branding to build the rival restaurant. Chung and Mymulgogi answered with their own counterclaim, accusing JB Brothers of breaching the same agreement by misrepresenting its trademark ownership and franchise system when it signed Chung up in 2017.
Injury
This dispute involved commercial and contractual harm rather than physical injury. JB Brothers said the Defendants' conduct damaged its business by diverting its confidential recipes, vendor relationships, and trained staff toward Tropic Poke.
Damages Sought
JB Brothers sought at least $500,000 in damages on its breach of contract claim, along with compensatory damages, disgorgement of profits, an accounting, injunctive relief, and punitive damages tied to its other claims. Chung and Mymulgogi, in turn, sought damages on their counterclaim that JB Brothers had breached the licensing agreement.
Key Arguments and Proceedings
Legal Representative
Plaintiff(s)/Counter Defendant: JB Brothers, Inc.
· Counsel: Amy Lee Nashon (Lead Attorney) | TroyGould PC | Samantha Doyle | TroyGould PC | Cristyn N. Chadwick (terminated 03/28/2025; later Eisner LLP)
Counter Defendant: Kwang S. Lim a.k.a. Chris Lim
· Counsel: Amy Lee Nashon | Samantha Doyle
Defendant(s)/Counter Claimant(s): Jaewoo Chung | Mymulgogi, Inc.
· Counsel: Daniel H. Ngai | Douglas Robert Luther | Elena Nathalie Sandell
Defendant(s): Kyungjin Kang | Tropic Ohana, Inc. d/b/a Tropic Poke
· Counsel: Jong Pil Pak
Key Arguments or Remarks by Counsel
JB Brothers' complaint framed the dispute as a case of a franchisee turning against the company that helped him get started, arguing that Chung repaid its investment and support by conspiring with Kang to copy its system for a competing restaurant. Chung and Mymulgogi's answer pushed back on nearly every factual allegation, arguing that JB Brothers had overstated the assistance it gave and had never owned the trademark rights it claimed to license.
Claims
Breach of Contract
JB Brothers alleged that Chung and Mymulgogi violated multiple sections of the licensing agreement, including by refusing to sign a long-form franchise agreement, altering menus and sauces without approval, sourcing materials outside JB Brothers' vendors, and opening a second, unauthorized restaurant. JB Brothers claimed these breaches caused it harm of at least $500,000.
Fraudulent Concealment and Omission
JB Brothers alleged Kang concealed his ownership interest in Poke Bar Lewers and his role in helping Chung use JB Brothers' system for Tropic Poke, claiming Kang knew this information would have prompted JB Brothers to terminate the franchise relationship and take legal action sooner.
Intentional Interference with Contract
JB Brothers alleged Kang and Tropic Ohana intentionally caused Chung to breach the licensing agreement by conspiring with him to jointly operate both restaurants using JB Brothers' stolen system and materials.
Intentional Interference with Prospective Economic Advantage
JB Brothers alleged Chung knowingly disrupted a prospective franchise relationship between JB Brothers and Kang by encouraging Kang to keep operating Tropic Poke without becoming an official Poke Bar franchisee, which would have required Tropic Poke to pay royalties.
Violation of California Uniform Trade Secrets Act
JB Brothers alleged the Defendants misappropriated its trade secrets, including recipes, food preparation methods, customer lists, and vendor agreements.
Conversion
JB Brothers alleged the Defendants took its recipes, sauces, and other proprietary materials and converted them for use at Tropic Poke, including by having Lewers Street employees train Tropic Poke staff.
Accounting
JB Brothers sought an accounting to determine what royalties, penalties, and other amounts the Defendants owed, arguing it could not calculate these figures without access to Tropic Poke's sales records.
Defense
Denial of the Alleged Conspiracy
Chung and Mymulgogi denied conspiring with Kang and denied that Chung held any ownership interest in Tropic Poke. They admitted Chung, Kang, and Lim played golf together in January 2021 but denied the remaining details JB Brothers attached to that meeting.
Affirmative Defenses
Chung and Mymulgogi raised eighteen affirmative defenses. Among them, they argued JB Brothers fraudulently induced them into signing the licensing agreement by misrepresenting its trademark ownership, since JB Brothers allegedly held only a logo mark rather than the standard "Poke Bar" mark referenced in the agreement, and had just five outlets in California and one Hawaii vendor at the time of signing. They also argued JB Brothers never provided the offering circular required under Hawaii franchise law, entitling them to rescission, and that JB Brothers breached the implied covenant of good faith and fair dealing by permitting a competing franchisee near their exclusive territory. Additional defenses included failure to mitigate damages, unjust enrichment, unclean hands, estoppel, waiver, and comparative fault.
Counterclaim for Breach of Contract
Chung and Mymulgogi countered that JB Brothers breached the same licensing agreement, largely built around the trademark and disclosure misrepresentations raised in their affirmative defenses.
Jury Verdict
Before trial, the Court resolved several claims through summary judgment and motions to dismiss. The Court dismissed JB Brothers' fraud claim against Chung and its claims against Kang, Mymulgogi, and Tropic Poke for trademark misappropriation, Lanham Act violations, and California Unfair Competition Law violations. It also dismissed Chung and Mymulgogi's claims for breach of the implied covenant of good faith and fair dealing, failure to provide an offering circular, fraudulent misrepresentation, negligent misrepresentation, and fraudulent inducement, along with their claim against Kwang Lim for tortious interference with contract. Through summary judgment, the Court ruled for Chung, Kang, Mymulgogi, and Tropic Poke on JB Brothers' claims for conversion, accounting, and trade secret violations, and ruled for Chung and Mymulgogi on JB Brothers' breach of contract claim. The Court also ruled for Kang on JB Brothers' fraud claim, for Kang and Tropic Poke on the intentional interference with contract claim, and for Chung on the intentional interference with prospective economic advantage claim.
That left Chung and Mymulgogi's counterclaim for breach of contract against JB Brothers to go to trial. On April 3, 2025, the jury returned its verdict on that counterclaim. The jury found that Chung and JB Brothers had a contract, that Chung had done all or substantially all of what the contract required of him, and that JB Brothers had done something the contract prohibited. However, the jury found that Chung was not harmed by JB Brothers' breach and did not award him nominal damages, ending the counterclaim without any damages.
On May 29, 2025, Judge Klausner entered final judgment consistent with these rulings. Judgment was entered for JB Brothers and against Chung and Mymulgogi on the counterclaim, and for the Defendants on JB Brothers' claims for conversion, accounting, trade secret violations, breach of contract, fraud, intentional interference with contract, and intentional interference with prospective economic advantage, closing out the case.
Court documents are available upon request at [email protected]
