StockdungU Saturday, 11/09/13 06:20:35 PM
Re: war eagle post# 59922
Post # of 84648
Tuffin in the deal so if FUSE defaults he walks away with all the assets of FUSE with the 60 day investment group.
The investment group has money for advertising and product. Tuffin remains running company.
Shareholders get shaft.
Thats the way I see it.
Tuffin should watch out to. Take a look at what they did to Daniel Fisher
BioZone Founder's $30M Suit Survives Forum Challenge
By Beth Winegarner 0
Law360, San Francisco (February 12, 2013, 7:54 PM ET) -- A California federal judge on Tuesday refused to toss a pharmaceutical company founder's $30 million lawsuit claiming BioZone Pharmaceuticals Inc.’s investors illegally stripped him of the company, saying the founder’s employment and stock-sale agreements with BioZone are too ambiguous to show the case could only be brought in New York court.
When BioZone Laboratories founder Daniel Fisher sold shares in his company to investors with Brauser Honig Frost Group, the parties entered a stock-sale agreement and an employment agreement that would provide Fisher with a job at the new BioZone Pharmaceuticals, according to court documents. Although both of those agreements contain forum-selection clauses, only one clearly requires cases against BioZone to be filed in New York, U.S. District Judge William Alsup ruled.
“These two agreements, when considered together, were ambiguous and it would be improper for this order to dismiss at this juncture,” Judge Alsup wrote. “Defendants, however, may renew their motions for … dismissal after discovery into the inclusion of the forum-selection clauses.”
BioZone intends to pursue that discovery and is confident that Judge Alsup will ultimately grant the motion, said Paul Sievers, attorney for BioZone Pharmaceuticals and for BioZone CEO Elliot Maza, investors Michael Brauser, Barry Honig and Phillip Frost, and two others named in the complaint.
However, Fisher's attorney, Darcy Paul, said he was pleased with Judge Alsup's ruling and didn't see how BioZone's next motion for dismissal on the forum-selection clause “would be different from what they propounded here.”
Fisher founded BioZone Laboratories in Pittsburg, Calif., 22 years ago; the company manufactured a variety of products, including liquid cough and cold medicines, acne medications and cosmetics, Darcy Paul said. In 2011, the investors approached Fisher about purchasing the company; after six months of negotiations, they agreed to buy all of Fisher's 6.6 million shares, 80 percent of which would be returned to him five days after the deal closed, and 20 percent of which would remain in escrow, according to his complaint.
Instead, none of Fisher's shares was returned to him, and he was never paid market value for them, the complaint said. The investors also never made good on an agreement to make Fisher an executive vice president of the company, it said.
Fisher is seeking triple damages on the more than $30 million in shares he says he lost in the deal, according to Darcy Paul. His lawsuit also accuses Brauser Honig Frost Group and its investors, many of whom became executives at BioZone Pharmaceuticals after the sale, of violating the Racketeer Influenced and Corrupt Organizations Act for engaging in a pattern of similar behavior against other companies.
“We describe [several] other suits against these defendants, either one or a group of them, in which a similar set of behaviors occurred,” Darcy Paul said. “This looks like a scheme.”
Fisher's lawsuit “looks only at one side of the story, which is not my clients' position,” Sievers said. “We have a different view of the facts.”
Daniel Fisher is represented by Darcy Paul of Paul Law Group PC.
BioZone Pharmaceuticals is represented by Paul Johnson Sievers of Manly & Stewart.
The case is Fisher v. BioZone Pharmaceuticals Inc. et al., case number 3:12-cv-03716, in the U.S. District Court for the Northern District of California.
--Editing by Jeremy Barker.
