PR Agent Sues Over Nonpayment by Clients Claiming to Be Dissatisfied

Call it Entrepreneurs Under Attack: Part 2.

Turns out the Sacramento PR man who lost a trademark infringement suit to the publisher of Entrepreneur magazine has himself initiated legal action against small-business owners.

Scott Smith is suing several present and former public relations clients who have balked at paying his annual $10,000 fee. The clients say in interviews that they withheld portions of their payments because they didn’t get their money’s worth from Smith, owner of Entrepreneur PR.

But Smith says he provided the services listed in clients’ contracts and is entitled to full payment. Those services include a listing on Entrepreneur PR’s Web site and inclusion in Entrepreneur Illustrated, an agency-produced magazine that features its clients.

Smith said some clients are disappointed that they haven’t collected a pile of press clippings since signing on with his firm. But those clients “have no clue how much PR costs,” said Smith, adding he offers a basic service. “It is like complaining that a Camry, a perfectly good car, can’t outperform a Ferrari.”

In Sacramento Superior Court filings, however, two Entrepreneur PR clients contend that the agency misrepresented its media prowess. Michigan small-business owner Colleen Pace told the court that she hired Entrepreneur PR because it claimed to have contacts at Oprah Winfrey’s magazine. Pace said the agency told her that O Magazine had an interest in such businesses as Pace’s American Assn. of Riding Schools.

But, Pace asserts in court papers, “these representations were in fact false.”

Another client, Oklahoma dentist Edward Tarr, said in court documents that Entrepreneur PR failed to publicize his business with “2,500 media contacts” as it promised.

Smith denies the allegations.

In interviews, three other Entrepreneur PR clients said they hired the agency because it offered them a shot at getting on “Montel Williams,” “Oprah” or in O Magazine. The Entrepreneur PR Web site lists what it refers to as testimonials from media organizations, including this comment from Inc. magazine, “Thanks so much.” A footnote says the testimonials aren’t endorsements.

But Smith said his contacts have paid off for some of Entrepreneur PR’s 100 or so clients. Among them is Lisa Hammond, whose Las Vegas mail-order company has been mentioned in the Wall Street Journal and O Magazine.

“I’m really happy,” said Hammond, who hired Smith’s firm about nine months ago. “I’ve recommended Entrepreneur PR to other business owners.”

Smith says he helped get coverage in a recent Opportunity World magazine for Tarr’s product, kids’ toothbrushes that can be turned into bracelets.

And there’s the publicity Smith generated for himself over his appeal of the Entrepreneur Media suit, which has been mentioned in Business Week, Forbes and other publications. Smith changed the name of his firm to EPR in compliance with a June federal court ruling barring him from using the word entrepreneur.