Legal Proceedings
On July 29, 2013 the Company was named as a defendant, along with two individuals, including Kasian Franks, who owns more than five percent of the outstanding common shares of Company, in a lawsuit filed by Khoi Senderowicz in Alameda County Superior Court. The suit alleges breach of an oral lease, and damages to property. The plaintiff seeks damages of $381,887. The Company has not yet been served with process. The Company believes that this a private landlord-tenant dispute between Khoi Senderowicz and Kasian Franks and intends to defend the claim vigorously. Discovery has not yet commenced.
In July 2013 the Company became aware that a default judgment had been entered against it in favor of Mario Armando Wilson, in the amount of $62,141. The Company is investigating the circumstances under which the judgment was entered, and reserves all rights to challenge the propriety of the judgment.
The Company was threatened with legal action by Felix Chan, who formerly had an independent contractor relationship with the Company. Chan asserts that the Company is obliged to pay him $171,000. No claim has been filed, and the parties are engaging in settlement discussions. The Company intends to vigorously defend any claim filed on this matter.
In July 2013 the Company was threatened with legal action by Eric Rice, a former employee who claims to be entitled to payment of $90,000. The Company denies any obligation. No claim has been filed. The Company intends to vigorously defend any claim filed on this matter.
In July and August 2013 the Company and its wholly-owned subsidiary, Adaptive Media, were threatened with legal action by BlueLink Marketing, relating to claimed unpaid contract fees. BlueLink claims that the Company owes $285,000. The Company disputes that any amount is owed, and is investigating potential claims against BlueLink. The Company intends to vigorously defend any claim filed on this matter.
