CLOK paid million$ lawsuit related to Kroosses
THE COMPANY FILED SUIT, PAID OUT MILLIONS IN STOCK, AND RECEIVED $0 IN FROM "DEFENDANTS".
From 9/30/14 10-K:
ITEM 3. LEGAL PROCEEDINGS
We are currently not involved in any litigation that we believe could have a material adverse effect on our financial condition or results of operations.
On July 5, 2013, the Company filed a complaint against Krooss Medical Management Systems, LLC, William F. Krooss and Marie W. Krooss ( the “Defendants”) in the United States District Court, District of Nevada Case No. 2013-CV-01187-ABG-VCF for the collection of approximately $200,000 of unpaid medical billing fees that were seriously delinquent.
After many attempts by the Company to begin collections, the Defendants refused to pay the outstanding balances, however they expected the Company to continue to bill for them. The Complaint includes causes of action for Breach of the Permanent Asset Transfer and Purchase Agreement (“PTAPA”), Breach of Billing and Collections Contracts, Negligence, Breach of the Duty of Good Faith and Fair Dealing, Tortious Interference with Business Relations, Fraud, and other causes of action.
On August 13, 2013, Krooss Medical Management Systems et al filed a Complaint in Chancery Court of Rankin County, Mississippi Case No. 13-1372 as a strategy to keep the collection matter in Mississippi Chancery Court.
On September 22, 2013 Case No. 13-1372 was remanded to Chancery Court of Ranking County, Mississippi Case No. 3:13CV507-HTW-LRA.
On June 23, 2014, Orhan Ilercil, MD, Mississippi Brain and Spine PLLC filed a Complaint in County Court of Rankin County Mississippi. This matter is a collection matter where as Dr. Ilercil owes the Company over $30,000 in unpaid billing fees. The Plaintiff claims there is a defect in the billing software.
This litigation is a collection matter of unpaid fees by the Defendants and the Company denies the allegations (Breach of the PTAPA, Rescission of the PTAPA, Breach of Billing and Collections Contracts, Negligence, Quantum Meruit, Restitution, and Estoppel, Breach of the Duty of Good Faith and Fair Dealing, Tortious Interference with Business Relations, and other causes of action) filed in Mississippi Chancery Court related to this collection matter. The Company does not expect the cost to litigate this matter to adversely affect the Company’s operations. However, the Company has discontinued operations in DNA-Cloud in Mississippi as the Company believes the Defendants have interfered with the billing contracts purchased which is one of the causes of action in the Complaint, among others. The Company believes many of the contracts have been terminated due to the interference by the Defendants, and DNA-Cloud has not been able to expand the business because of the reputation of the Defendants in Jackson, Mississippi and the surrounding area.
