The company founded by Instagram fitness tycoon Kayla Itsines has continued its fight against a former employee in court, arguing the rising influencer’s rival exercise app could cost it up to $1m in lost revenue.
The Bikini Body Training Company, founded by Ms Itsines, is trying to block Queensland crossfit guru and Instagram star Cass Olholm from launching her new fitness app, Train With Cass, set to go on sale on the Apple App Store from Thursday.
The company, represented in the South Australian Supreme Court by Nicholas Swan, on Tuesday said Ms Olholm, who worked as a contractor for Ms Itsines before leaving in February this year, had breached restraint of trade by preparing her new business.
Bikini Body wants Ms Olholm to obey a 12-month restraint of trade clause, which would prohibit her from competing with the company until February 2024.
Ms Olholm, represented by Thomas McFarlane, argues the restraint period expired after six months and her new business can proceed.
At a hearing last week, Judge Dart recommended the two parties pursue mediation to avoid spending “very large sums of money” on lawyers, but the two influencers failed to reach a settlement and returned again on Tuesday to battle it out at the court, with potentially millions of dollars hanging in the balance.
Mr Swan argued Ms Olholm had potentially pulled custom from the Sweat app, reading out a number of comments left on her Instagram celebrating the proposed launch of her new venture.
“‘The time couldn’t be more perfect for me, my Sweat subscription ends in October, so excited for your app’,” Mr Swan said reading out one reader’s post.
He also argued Ms Olholm’s “attractive force”, or the goodwill she possessed and which Bikini Body had paid her for, should not be used to build up a rival business inside of the 12-month restraint clause.
“The main question in this case, as we see it, is whether until February next year is a reasonable time,” he said.
“That is the core point. In our respectful submission, 12 months, in the context of the history of this matter, in the context of the nature of the business, in the context of what is involved, is eminently reasonable.”
Mr Macfarlane said it was unreasonable for the company to try and restrain Ms Olholm’s goodwill, something he said she had built up herself over several years, including years when she was outside of the company, and something that was outside of non-compete protections.
“What is being sought to be enforced against my client is a restraint upon my client using her own skills and experience,” he said.
“Using those skills and experience in areas in fitness and training, she has got qualifications for that, in competition with the applicant’s product.”
He said there was no allegation Ms Olholm had accessed confidential company information, including client lists, or that she had used confidential information to develop her own business.
The court heard Bikini Body feared Ms Olholm’s move into the app market could cause them losses of up to $1m from subscribers moving from Sweat over to Train With Cass.
Mr Macfarlane disputed the figure and said any identifiable loss to Bikini Body would be “minimal” and “nowhere near the figure of $1m”.
Ms Itsines sold Sweat to US company IFit in 2021 for a reported $400m.
The court heard Bikini Body boasts annual revenues of about $65m.
The two influencers were close collaborators in the fitness space, with Ms Olholm regularly appearing in Ms Itsines’ Facebook videos after she joined the company in 2020.
The Train With Cass program, if it goes ahead next week, will be billed at $21.99 a month or $139.99 a year.
The court heard Ms Olholm had spent some $580,000 preparing the new business.
Mr Swan wants the court to order an injunction blocking Ms Olholm from launching her new business until the contract’s 12 month restraint of trade clause expires.
Mr Macfarlane wants the court to dismiss Bikini Body’s application.
Judge Jack Costello said he would deliver his ruling on Thursday at 2.15pm.