Max Sound Corporation (MAXD)

[grantastic]

Excellent DD from SEC filings:

This is all from SIGNED FILINGS
2019 10-k: https://www.otcmarkets.com/filing/html?id=14119887&guid=3KbqUWLMLgd_13h
2018 10-k: https://www.otcmarkets.com/filing/html?id=13332166&guid=35g3UF7exZFlc3h
2017 10-k https://www.otcmarkets.com/filing/html?id=12659683&guid=35g3UF7exZFlc3h
2016 10-k https://www.otcmarkets.com/filing/html?id=11969297&guid=35g3UF7exZFlc3h

Lifetime revenue: $0 (ZERO DOLLARS)

2019 Executives' salaries: $450,000 / yr (CFO $288k + CEO $162k /yr)
2018 Executives' salaries: $496,252 / yr (CFO $288k + CEO $208k /yr)
2017 Executives' salaries: $336,000 / yr (CFO $192k + CEO $144k /yr)
2016 Executives' salaries: $504,000 / yr (CFO $288k + CEO $216k /yr)
2015 Executives' salaries: $504,000 / yr (CFO $288k + CEO $216k /yr)

MAXD owes Google: $819,626 (costs for dismissed lawsuit)

2019 operating loss: $622,351
2018 operating loss: $1,476,503

Convertible debt (Dec, 2019): $6,160,429
Convertible debt (Dec, 2018): $5,987,527
Average debt conversion discount: 66%

Shares outstanding (as of Mar 2020): 6,587,102,823
Shares outstanding (as of Dec 2018): 6,573,852,824
Shares outstanding (as of Mar 2018): 3,715,287,050
Shares outstanding (as of Sep 2017): 1,862,959,202
Shares outstanding (as of Sep 2016): 847,363,298

Potential future dilution: 118,325,656,764 shares (118 billion !!)
Potential future dilution: 18x share increase (!!)

Current A/S: 10,000,000,000

Some important events:

A/S raised to 10,000,000,000 (10 billion) on Feb 1, 2018, even though reported O/S (~1.86b) was less than HALF the previous A/S (4.5b)

Def 14c: https://backend.otcmarkets.com/otcapi/company/sec-filings/12510930/content/html

MAXD drops its lawsuit against Netflix 3 years ago, and never refiled:

The Company, on or about December 2015 upon advice of counsel, decided withdraw the litigation prior to oral argument

MAXD's Lawsuit against Google is dismissed. MAXD appeals. MAXD loses the appeal.

However, on November 24, 2015, the court granted a second motion to dismiss for lack of subject matter jurisdiction based on the defendants’ argument that the agreements between the Company and VSL/Vedanti did not clearly give the Company standing to enforce the patent rights. The Company appealed that decision on February 22, 2016. One January 18, 2017 the Company received a notice from the Federal Circuit Court of Appeals that affirmed the order of the District Court dismissing MAXD's patent infringement lawsuit against Google for lack of standing.

Google is awarded $820,000 in costs against MAXD. MAXD appeals the award, and the award is sustained.

On September 25, 2017, the Court issued an order that the Company should reimburse defendants for its attorneys’ fees in the amount of $819,626.

Most of the '339 patent is invalidated by Inter-Partes review. (This was after MAXD sued Google for this patent, lost, lost the appeal, and vowed to sue again). Vedanti appealed the IPR, and the IPR was upheld.

https://www.docketalarm.com/cases/PTAB/IPR2016-00215/Inter_Partes_Review_of_U.S._Pat._7974339/05-17-2017-Board/Termination_Decision_Document-8-Termination_Decision_Document/

Accordingly, it is ORDERED that claims 1, 6, 7, 9, 10, 12, and 13 of the ’339 patent are held to be unpatentable;
FUTHER ORDERED that Vedanti’s Contingent Motion to Amend is denied;

...

MAXD purports to be funding the Eli Attia lawsuit:

On December 5, 2014, the Company, along with renowned architect Eli Attia, filed a lawsuit in the Superior Court of California, County of Santa Clara, against Google, its co-founders Sergey Brin and Larry Page, Google’s spinoff company Flux Factory, and senior executives of Flux. Plaintiffs’ allege misappropriation of trade secrets, breach of contract and other contract-related claims, breach of confidence, slander of title, violation of California’s Unfair Competition Law (California Business and Professionals Code §§ 17200 et seq.), and fraud, and also a claim for declaratory relief.

Eli Attia adds RICO complaint to lawsuit against google; Google moves the lawsuit to Federal District Court. Trial date changed to be in the year 2021:

On October 4, 2017, the Court granted Mr. Attia leave to amend the complaint to add causes of action against defendants for civil violations of the federal Rackateer Influenced and Corrupt Organizations Act (commonly known as RICO). Subsequently, on October 23, 2017, the defendants removed the lawsuit from California state court to the federal district court in the Northern District of California, San Jose Division.

Eli Attia's RICO complaint is promptly dismissed:

https://www.pacermonitor.com/public/case/22802326/Attia_et_al_v_Google_LLC_et_al

ORDER GRANTING WITH LEAVE TO AMEND 30 31 DEFENDANTS' MOTIONS TO DISMISS RICO CLAIMS IN FOURTH AMENDED COMPLAINT; DENYING 38 PLAINTIFFS' MOTION FOR PARTIAL REMAND. Signed by Judge Beth Labson Freeman on 6/13/2018.

Eli Attia loses his appeal of the RICO complaint

https://cdn.ca9.uscourts.gov/datastore/opinions/2020/12/16/19-15771.pdf

The Attia lawsuit was returned to County court. The only surviving claim by Eli Attia is "Breach of Contract". There is a hearing for Summary Judgement on this case scheduled for January 28, 2021

Eli Attia has attested that MAX Sound is no longer involved with his lawsuit.

Greg Halpern has admitted MAXD had to stop funding the Eli Attia lawsuit in 2018:

https://www.docketbird.com/court-documents/Max-Sound-Corporation-et-al-v-Google-Inc-et-al/Declaration-of-Greg-Halpern-in-Support-of-211-Opposition-Response-to-Motion-for-Order-Permitting-Registration-of-Judgment-filed-by-Max-Sound-Corporation/cand-5:2014-cv-04412-00212

The inability to provide funding for the Attia case will result in irreparable harm to the Attias, who are depending on such funding to pursue their claims against Google. The inability to provide funding for Max Sound’s other business operations will result in the permanent loss of existing and potential business transactions.

...

MAXD was sued by their own ex-lawyers for failure to pay. Adli is the only lawfirm who has ever won for MAXD in court.

On June 1, 2016, the Company was named as a defendant in an action filed in the Superior Court of the State of California, County of Los Angeles – Central District, captioned Adli Law Group, PC v. Max Sound Corporation (Case No. BC621886).

MAXD's lawyers in the Adli lawsuit are (ironically) also demanding payment and were eventually replaced:

SML Avvocati, P.C. firm informed Appellant for the first time that it would not file any brief on Appellant’s behalf or take any further action in the appeal unless Appellant immediately paid them an exorbitant sum of allegedly unpaid attorney’s fees.

MAXD lost its lawsuit against Adli

The court provided a summary default judgment in favor of Adli one day before Max Sound obtained a revivor.

...

CEO John Blaisure DUMPED $68,000 in shares ... right before the price fell an extra 90% because of dilution

2,266,613 shares @ $.0108 = $24,479.42
2,200,000 shares @ $.0200 = $44,000.00

Total: $68,479.42

Form 4, Mar 2017: https://backend.otcmarkets.com/otcapi/company/sec-filings/11951837/content/html
Form 4, Sep 2016: https://backend.otcmarkets.com/otcapi/company/sec-filings/11614233/content/html

John Blaisure's accidentally or deliberately misrepresented those share sales with a "purchase" trans code on the form 4s. This causes the insider trades to falsely appear as PURCHASES instead of SALES on most websites. The filings confirm that Blaisure actually SOLD however:

2015 10-K: https://backend.otcmarkets.com/otcapi/company/sec-filings/11290113/content/html - Beneficial ownership: 32,767,573

2016 10-K: https://backend.otcmarkets.com/otcapi/company/sec-filings/11969297/content/html - Beneficial ownership: 28,300,960 shares

Share ownership REDUCED by 4,466,613 shares.

CFO Greg Halpern converted 120,000,000 common shares into preferred dividend shares:

On March 4, 2015 the Company filed a form 8K with the SEC associated with the Company entering into a Securities Exchange Agreement and the Company filing with the Secretary of State Delaware a Certificate of Designations, Preferences and Rights whereby, among other things, the Company for good and valuable consideration, agreed that in consideration of a large shareholder exchanging 120,000,000 shares of common stock back to the Company, the shareholder would receive 5,000,000 shares of Series A Convertible Preferred Stock of the Company at a Stated Value of $0.96 per share and a Conversion Price of $0.04 per share. The Series A Convertible Preferred Stock carries certain voting preferences and will accrue dividends at a rate of 8% per annum Stated Value, payable in cash or in kind at the election of the Board of Directors. For the year ended December 31, 2016 and for the year ended December 31, 2015, the Company has not declared dividends.

CFO Greg Halpern used those accrued dividends to gift himself 800,000,000 more common shares. Those common shares were promptly converted into more preferred dividend shares.

On October 2, 2017, the Company, in exchange for Greg Halpern's consideration issuing the Company a line of credit of $100,000 on July 6, 2017 and another line of credit of $200,000 on October 2, 2017 and for Mr. Halpern's forgiveness of $960,000 of interest owed to Mr. Halpern for his Preferred Shares accrued dividend rate of 8% per annum of his already owned 5 million Series A Convertible Preferred Shares, the Board deemed it proper to grant Mr. Halpern an additional 800,000,000 shares of the Company's common stock, which at Mr. Halpern's election he may convert into 5,000,000 additional Series A Convertible Preferred Shares with the same voting rights and percentages as his previously granted and owned 5,000,000 Series A Convertible Preferred Shares.

On November 8, 2017, the Company, at Greg Halpern's election , converted 800,000,000 shares of Common Stock into 5,000,000 Series A Convertible Preferred Shares representing 33.4% of the Company’s voting rights and control adding to Halpern’s existing 33.4% holdings, equaling 66.8% of the Company’s total voting rights and control.

CFO Greg Halpern cashed in $2,235,000 selling shares, in addition to his millions in salary:

$2,000,000 sale https://www.otcmarkets.com/filing/html?id=9518664&guid=IabqUFccQ8sNw3h
$235,000 sale https://www.otcmarkets.com/filing/html?id=9194644&guid=IabqUFccQ8sNw3h