Dearest Customer,

I am Francesco Zanata, founder and creator of K-Laser around the world, the emblem of state of the art on a global level of the most powerful, exclusive and effective compact devices for laser therapy and class 4 surgery.

The Eltech K-Laser team and I are proud you have chosen one of our K-Laser products, the one and only original Made in Italy, and that you have found satisfaction in using it for your work.

K-Laser is the company that has always shown the way, followed and copied by laser therapy and surgery businesses around the world.

In the United States, over the past two years, a great confusion has been created by our former distributor, Laser Therapy LLC, that later became K-Laser USA LLC, who managed K-Laser’s territories in the USA and Canada.

It is with great personal pride and satisfaction that the Eltech K-Laser team and I announce you that we have permanently put an end to this problem through an arbitration award following a trial held in Atlanta and already confirmed by an U.S. court.
The former distributor of our K-Laser products in the USA and Canada is subject to a court order to cease his improper use of the K-Laser marks.
Unfortunately, in the period prior to the court’s ruling, our former distributor had affixed the K-Laser mark to a new Made in China product, more precisely on the laser device called “Platinum”, stating that it was a new K-Laser device model of higher quality.
I am truly sorry for those who bought this product believing they were buying a real and new K-Laser device manufactured by Eltech K-Laser S.r.l..

In confirmation of the above, attached to this letter, you will find a summary of the facts contained in the Award (excerpts quoted and renumbered by Eltech K-Laser S.r.l.) and a copy of the injunction from the Award, in which we got justice in response to our former distributor’s illicit behavior.

K-Laser USA, LLC, has now changed its name into SUMMUS MEDICAL LASER, LLC, and it continues reselling the “Platinum” and other SUMMUS branded products, which are not, once again, K-Laser products.

K-Laser belongs to Eltech K-Laser, with headquarters in Treviso, Italy.
The clarity of this award leaves no room for uncertainties.
Our products K-Laser® CUBE, which are currently included in our production range, were designed by me, together with my team in Eltech K-Laser, developed and manufactured with our internal forces at unquestionable quality levels. Each component of all K-Laser devices is designed and manufactured by K-Laser.
You who use them every day know them well!

We have been Made in Italy ever since Eltech K-Laser was founded in 1999.
Our growth and our constant commitment continue to rise.

K-Laser® is our brand and it is registered in almost every country in the world.
Over the years, the K-Laser® brand has become synonymous with high performance, with compact but powerful laser devices, and above all with superior quality.
K-Laser® is an icon from which competitors have always taken inspiration in the attempt to bridge the gap that we have always been able to create.
Even today we see new actors trying to copy our design and our style, as if to create a confusion of identity.

We are K-Laser®, the only one, the original, the authentic.
We are and we have always been Made in Italy.
We are K-Laser CUBE.

With this letter, I would also like to inform you that we have a new important distributor for the United States and Canada, namely DJO Global Chattanooga.
Should you need any service assistance, please contact DJO Global Chattanooga or write an email to service@klaser.it

The American market is and remains the most important market for us, and we will be more and more present.
Furthermore, we are also developing a series of new K-Laser Speciale Live Therapy products that you can check out on our official website: www.klaser.eu

New K-Laser models are coming and you can find them at the next VMX veterinary conference, which will be held in Orlando, Florida, January 18th – 22nd, 2020. Come and visit us at stand 2741!

For those who have unfortunately purchased a Pioon’s Platinum laser device, and therefore a Made in China device believing it was a K-Laser we are willing to replace it with our new and original K-Laser Cube Performance 30, the latest K-Laser device, created to celebrate the 20th anniversary of K-Laser, for a very special price.
K-Laser Cube Performance 30 is the most powerful, performing, safe and compact portable laser device in the world.
You can visit our official website www.klaser.eu and check out the presentation.

In case you need more information, please contact the email address info.klaser@gmail.com
The doors of our company are always open to all of you customers, because we say what we do and do what we say.

A sincere thanks to all of you.

Best wishes,

Francesco Zanata
K-Laser founder

Albright’s Name Change and Development of a Competing Laser Therapy Device

A. In June 2015, after Annex 1 rescinded KLUSA’s sales rights in the Additional Territories,
Albright changed the name of his company to KLUSA through filings with the Tennessee
Secretary of State. [Tr. Ex. 167 at 9-10]. Eltech was not notified of the name change.
KLUSA continued to conduct business with Eltech under the name “Laser Therapy
Products, LLC. [Tr. Exs. 384, 385; Tr. 474].

B. Before the 2009 Agreement was terminated, Albright and KLUSA began working with
other entities to develop laser therapy devices to compete against Eltech’s laser therapy
devices. Albright and KLUSA undertook efforts to prevent Zanata and Eltech from learning
of these activities.

C. On September 15, 2015, Albright contacted Joseph Dallas (“Dallas”), President of Avo
Photonics (“Avo”). Avo is an engineering and consulting firm in Horsham, Pennsylvania,
specializing in the design, prototype, and production of optoelectronic assemblies, to
determine if Avo would develop laser therapy equipment for KLUSA to sell.

D. Albright explained to Dallas that KLUSA had a European manufacturer who was selling
directly, KLUSA was afraid to complain about this conduct out of fear the manufacturer
would stop supplying lasers, and KLUSA no longer wanted to be held in a position where
they only had one source for a laser. [Tr. Ex. 263 at 18-20].

E. Albright sent Dallas and Avo a copy of Eltech’s detailed technical specification sheet for the
K-Laser Module which, Albright noted, “This should give you a good insight.” [Tr. Ex. 265;
Tr. 445, 459-465].

F. Avo then produced a Phase 0 Laser Analysis Quote on October 9, 2015, detailing the next
steps of product development, to commence with KLUSA providing an exemplary K-Laser
device to Avo as the basis for their new laser therapy device. A K-Laser Cube device was
sent to Avo on October 27, 2015. [Tr. Ex. 263 at 26-28, 32].

G. Albright encouraged Avo to bring in Andrea Girotto, an Italian software programmer who
had previously worked for Eltech on the K-Laser devices. [Tr. Ex. 266]. Girotto had entered
into several contracts with Eltech, each of which contained a five-year non-compete clause.
The latest contract was signed July 2, 2012; thus, Girotto agreed he would not compete with
Eltech through July 2, 2017. Girotto also had a non-disclosure agreement with Eltech,
signed February 4, 2008. [Tr. Ex. 252] Girotto provided assistance to Avo and KLUSA with
development of the new Class IV laser therapy device and this assistance is alleged to have
breached the non-compete and non-disclosure obligations in his Eltech contracts. [Tr. Ex.
365].

H. Albright also provided Avo’s development team access to design files for the electronics of
the K-Laser device. [Tr. Ex. 269; Tr. 477].

I. Dallas questioned who owned the information provided to him by KLUSA and he wanted
written assurances from Albright and KLUSA. On February 24, 2016, Albright sent an
email entitled “Indemnification,” in which Albright explained that KLUSA had hired Eltech
to manufacturer the K-laser and that KLUSA owned the intellectual property. [Tr. Exs. 268,
263, 46] Avo continued working to develop a competing laser therapy product.

J. In November 2016, an Avo employee, Stewart Wilson, accidentally sent Eltech a box of
circuit boards and components intended for Girotto in Italy. Zanata confronted Albright
about the FedEx shipment, and insisted Albright explain what had occurred. Albright did not
address the substance of Zanata’s inquiries. [Tr. Exs. 218, 219].

K. A series of emails between Albright, Girotto, and Stewart Wilson reveal the coordinated
multi-pronged approach to covering up this mistake. Albright instructed Wilson to never use
“K-Laser Italy” when shipping items to Girotto. Girotto scheduled an emergency meeting
with his attorney. [Tr. Exs. 272-274]. Albright suggested to Girotto and Wilson the idea of
making a fraudulent claim to FedEx to support his lie to Eltech that KLUSA’s FedEx
account was used inadvertently and without his authorization. Girotto offered to lie and say
that the components were for personal use and unrelated to lasers. [Tr. Exs. 272-274].

L. In January 2017, Albright emailed Dallas, warning him away from Eltech’s booth at the
Photonics West trade show, writing “Joe, The manufacturer Eltech from Italy is attending
the photonics west show. If he happens to stop by your both [sic] and introduces himself as
K-laser, you know nothing.” [Tr. Ex. 276].

M. Albright continued to provide Avo with Eltech’s internal documents. On May 22, 2017,
Albright sent a set of appendices Eltech had prepared for submission to the FDA, to be a
model for Avo’s work. [Tr. Ex. 278].

N. Avo did not develop a laser therapy device acceptable to KLUSA.

KLUSA’s Marketing and Sales of the Platinum Laser Therapy Device

A. On December 18, 2017, KLUSA signed an Exclusive Distribution Agreement with Pioon to
distribute Pioon’s P1 lasers in worldwide medical and veterinary markets, except China. The
Pioon Distribution Agreement included both Private Label branding provisions and original
equipment manufacturer, or OEM, provisions. [Tr. Ex. 217].

B. KLUSA worked with Pioon to modify the existing P1 dental laser into a laser for veterinary
and medical use, including addition of a new laser module, the design and introduction of
new workflows and protocols programmed by Pioon’s software developer, and the design
and incorporation of new graphics and screens created by a contractor engaged by KLUSA.
[Tr. 280:20-285:22].

C. Albright, on behalf of KLUSA and K-Global, testified that the Platinum was customized
from the original P1 Pioon version to have additional power and wavelengths. [Tr. Ex. 169
at 195:3-10]. He further testified that KLUSA provided specifications, protocols and design
ideas to Pioon, but did not provide any physical materials. [Tr. Ex. 169 at 216:9-219:13]. In
his testimony, Albright stated that the protocols provided by KLUSA to Pioon were
different from the protocols provided to Eltech. [Tr. Ex. 169 at 220:8-17].

D. The Platinum user interface was designed to be condition-centric, whereas the Cube’s
protocols were body part-centric. [Tr. 985:21-986:9]. The Platinum laser protocols have six
phases, no more and no less. The Cube protocols involve up to 11 treatment phases. The
lower number of protocol phases enables doctors to treat the entire treatment area during
each phase. [Tr. 988:2-989:22].

E. KLUSA paid Pioon $25,000 for software design in December 2017 for a custom Platinum
software. [Tr. Ex. 641]. KLUSA currently sells the Platinum laser. [Tr. 280:7-17].

F. The Parties agree the Platinum laser is manufactured in China by Pioon as an OEM, but the
intellectual property and molds associated with the Platinum laser are owned by K-Global
except Eltech disputes K-Global has any ownership interest in a K Mark. The dispute over
ownership of K Marks that are the subject of this arbitration are addressed elsewhere in this
Final Award.

G. K-Global acquired the worldwide rights (except China) to the intellectual property
associated with production of the Platinum from Pioon on February 20, 2018 for $100,000.
[Tr. Ex. 216].

H. KLUSA and K-Global, as manufacturer, travel to China frequently to inspect suppliers,
check product and manufacturing quality, and test devices. [Tr. Ex. 169 at 222:20-223:5].

I. KLUSA is selling lasers in the United States and Canada as KLUSA, and K-Global
internationally. KLUSA and K-Global are selling devices as the Platinum, and not the K-
Platinum, through the end of this arbitration. [Tr. Ex. 169 at 156:6-23].

J. The Platinum laser is currently branded with a [P] and a Platinum word mark. The name
KLUSA or K-Global appears on the back of the product. The “K-Laser” mark does not
appear on the front of the device until the laser is turned on and the touchscreen is activated.
[Tr. Ex. 254, Demonstrative].

K. Eltech believes Petitioners misused Eltech’s trade secrets because otherwise Albright “could
not have figured out” how Eltech’s lasers work. [Tr. Ex. 531; Tr. 36:4-18].

L. There are disputes regarding aspects of the Platinum and Cube devices. For example, Zanata
testified he believed KLUSA had engaged in false advertising because a heat pipe is not a
liquid-based cooling system. Eltech contends the Platinum does not have a liquid-based
cooling system, and that a liquid based cooling system is not as efficient as the direct
cooling system in Eltech’s Cube device. [Tr. 1287:5-1290:21].

M. Zanata asserted that the Platinum is falsely advertised as going to 20,000 hz. [Tr. 1291:2-
12]. KLUSA’s Platinum device is liquid-cooled and pulses up to 20,000 hz. [Tr. Exs. 729,
730, 735; Tr. 1943:17-1944:25, 1945:1-1946:19]. KLUSA states that the Platinum’s fan
runs much quieter than the fan in the Cube.

N. Zanata contends that the Platinum laser includes a multi-phased treatment system and that it
accesses KLUSA’s On Demand portal through WiFi, and it thereby incorporates Eltech’s
trade secrets. [Tr. 1259:15-1263:25].

Alleged Instances of Actual Confusion and Misrepresentations

A. Meanwhile, customers who reached out to KLUSA about purchasing the K- Laser Cube
devices were informed that the product was discontinued. The customers were instead
offered the Platinum 4 device. [Tr. Ex. 303].

This is a simple headline

A. In a brochure touting the Platinum laser, used at the VMX Trade Show in Orlando, FL in
February 2018, KLUSA claimed the Platinum laser is capable of pulsing up to 20,000 Hz.
[Tr. Ex. 244].

B. In addition, KLUSA maintained this claim at the arbitration final hearing, relying on a
photograph that ostensibly shows an oscilloscope reading the Platinum device operating at a
frequency of 20,000 Hz. [Tr. 1945:12-1946:19; Tr. Ex. 731].

C. However, Mr. Zanata testified and provide documentary evidence that documents
containing the technical specifications for the Platinum device that were submitted to the
U.S. certification authority [FCC], which are publicly available online at
https://fccid.io/2AP41-KP/Users-Manual/User-Manual3912320 and
https://fcc.report/FCC-ID/2AP4I-KP/3912325, state that the maximum frequency is 500 Hz.
[Tr. 1973:16-1974:3, 1975:2-24; Tr. Ex. “X”].

KLUSA’s Allegedly False Statements Regarding Liquid Cooling

A. In a brochure touting the Platinum laser, used at the VMX Trade Show in Orlando, FL in
February 2018, KLUSA claimed the Platinum laser is liquid cooled, which claim KLUSA
maintained at the arbitration final hearing. [Tr. Ex. 244:2; see also Tr. 970:16-23, 1943:21-
23].

B. Zanata disagrees. He testified the technical specifications for the Platinum device submitted
to the U.S. certification authority (the FCC) are publicly available online at
https://fccid.io/2AP4I-KP/Users-Manual/User-Manual~3912320 and
https://fcc.report/FCC-ID/2AP4I-KP/3912325. According to Zanata, the specifications state
there is an air cooling system and not a water cooling system. [Tr. 1967:19-1968:7, 1973:16-
1974:3, 1974:22-1975:1; Ex. “X”, 102].

KLUSA’s Allegedly False Labeling Regarding Country of Origin

A. The Compact demonstration presented during the hearings shows that the devices sold by
KLUSA and manufactured by Eltech, stated: “Made in Italy.”

B. The Platinum devices now sold by KLUSA do not say “Made in China” [Tr. 1637:1-9]. The
devices are manufactured in China. [Ex. “X”].

KLUSA’s Allegedly False Statement that Its Platinum Product Was the

“NEW K-LASER”

A. In February 2018, when KLUSA introduced its competing laser under the K-LASER
PLATINUM mark, the devices were listed “in line” on its website above Eltech’s K-LASER
CUBE products. [Tr. Ex. 246]. KLUSA touted its Platinum laser as the “world’s first smart
laser.” [Tr. Ex. 246].

B. By using the mark Platinum (to denote a higher level or quality), as well as order in which
the products were listed and displayed gave potential customers and sub- distributors the
sense the Platinum device was a newer, more upgraded version of the products that had been
produced by Eltech even though the Platinum product was not.

Albright’s Signed Acknowledgements

A. On June 28, 2017, Albright signed an acknowledgment to Eltech on behalf of KLUSA,
stating KLUSA “has not, and will not, hold itself as a manufacturer of Eltech’s lasers or a
partner of Eltech for the duration of the Distribution Agreement,” while it was representing
to Avo that KLUSA was entitled to develop and manufacture lasers. [Tr. Ex. 228; Tr. 664-
665].

B. On November 21, 2017, Albright signed a second acknowledgment to Eltech on behalf of
KLUSA, stating:
[KLUSA] is not representing or manufacturing any laser device, nor is it
engaging directly or indirectly, acting as an agent, commission merchant,
reseller, distributor, or in any other way, for the benefit of third parties
manufacturing or distributing items in competition with the products of
Eltech. [Tr. Ex. 229. Tr. 665-667].

C. By November 21, 2017, KLUSA had spent over a year developing a competing
laser therapy device. [Tr. Exs. 165, 217. Tr. 665-667].

Eltech’s Termination of the 2009 Agreement

A. On February 5, 2018, Eltech sent an email to KLUSA’s sub-distributors, notifying them that
the Platinum is not affiliated with K-Laser and that Eltech’s lawyers “will defend the mark
and every breached right.” [Tr. Ex. 568].

B. On February 12, 2018, Eltech terminated the 2009 Agreement “pursuant to Section 7.1.a
[sic] of the Agreement.” No other notice was provided to KLUSA. In the letter, Eltech stated
the termination was “due numerous breaches of the Agreement by K- Laser USA, LLC, all
of which have been the subject of written demands by Eltech to K- Laser USA more than 30
days prior to this notice. [Tr. Ex. 69]. The Eltech letter also made references to breaches
relating to unfair competition, the use of Eltech’s trademarks. and the use of Eltech’s trade
secrets. [Tr. Ex. 531; Tr. 16:20-17:7].