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Steve Papermaster – Court Cases
We are compiling a list of various controversies Steve . Known cases include: Court cases: Agillion v. Oliver, 114 S.W.3d 86 Like to...
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Mark Smith : 9 February 2024 9:18:06 PM
IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS AUSTIN DIVISION
MOZIDO, INC.,
Plaintiff,
v.
STEVEN G. PAPERMASTER, BRIAN G. MAGIERSKI, APPCONOMY, INC., APPCONOMY-US INC., NEUNANO CHINA CORP., BRIAN G. MAGIERSKI, IN HIS CAPACITY AS TRUSTEE FOR THE MAGIERSKI FAMILY TRUST, MOLI CAPITAL LLC (f/k/a 10X CAPITAL LLC), and GAIL PAPERMASTER, IN HER CAPACITY AS TRUSTEE FOR THE STEVEN G. PAPERMASTER 2014 TRUST,
Defendants.
Civil Action No. 16-675
PLAINTIFF’S ORIGINAL COMPLAINT
TO THE HONORABLE JUDGE OF SAID COURT:
Plaintiff Mozido, Inc. (“Mozido”) files this Original Complaint against defendants Steven
G. Papermaster (“Papermaster”), Brian G. Magierski (“Magierski”), Appconomy, Inc. (“App- Inc.”), Appconomy-US, Inc. (“App-US”), Neunano China Corp. (“Neunano”), Brian G. Magierski in his capacity as Trustee for the Magierski Family Trust (“Magierski Trust”), MoLi Capital LLC, formerly known as 10X Capital LLC (“10X Capital”), and Gail Papermaster in her capacity as Trustee for the Steven G. Papermaster 2014 Trust (“Papermaster Trust”) and respectfully shows the Court as follows:
NATURE OF THE CASE
in fact complete fabrications. With their fraudulent conduct uncovered, defendants then proceeded to default on their loan commitments to Mozido, and the $6.5 million loan that was provided to defendants has come due without any payment from defendants whatsoever.
THE PARTIES
Papermaster may be served with summons at 1300 Guadalupe Street, Suite 201, Austin, Texas 78746.
Magierski may be served with summons at 1300 Guadalupe Street, Suite 201, Austin, Texas 78746.
G. Papermaster or Brian G. Magierski, at 1300 Guadalupe Street, Suite 201, Austin, Texas 78746.
App-Inc. may also be served through its registered agent for service of process, C T Corporation, 1999 Bryan Street, Suite 900, Dallas, Texas 75201 and/or C T Corporation, 701 Brazos St. #360,
Austin, Texas 78701.
G. Papermaster or Brian G. Magierski, at 1300 Guadalupe Street, Suite 201, Austin, Texas 78746.
Neunano may also be served through its registered agent for service of process, Corporation Service Company, 2711 Centerville Road, Suite 400, Wilmington, Delaware 19808.
G. Magierski, at 11 Niles Road, Austin, Texas 78703-3138.
JURISDICTION AND VENUE
U.S.C. § 1391(b). Defendants maintain their principal place of business in the District, the acts charged herein - including a substantial part of the events giving rise to the claims below - occurred in this District, and Papermaster, Magierski, the Magierski Trust, 10X Capital, and the Papermaster Trust have consented in writing to venue in this District.
FACTS
The License Agreement provided, among other things, for Mozido rights in App-US licenses upon default under the Loan Agreement or Pledge Agreement. Specifically, under Section 2.5 of the
License Agreement, App-US agreed that upon default under the Loan Agreement or the Pledge Agreement:
Mozido shall automatically, without further action on the part of either party hereto, be granted an irrevocable, worldwide, fully-paid up, royalty-free, transferrable, perpetual, exclusive right and license under any and all Intellectual Property Rights, Technology and Deliverables owned (whether through acquisition or internal development or through other means), licensed or controlled by App-US to copy, distribute, display, perform, modify, make, use, sell, offer for sale, disclose, practice any process or method, import, export or otherwise dispose of and exploit any product, perform any services, and otherwise fully exploit such Intellectual Property Rights, Technology and/or Deliverables and to freely and fully sublicense such rights through multiple tiers.
Further, on December 15, 2014, App-Inc. gave Mozido its “unconditional consent” to the License
Agreement.
Chinese markets in “healthcare, Xikang, education, social security, citizen services, transportation, and retail/consumer services.”
Continuing to provide Mozido with further “evidence” of Neusoft’s commitment to Mozido, on February 23, 2015, Papermaster delivered to Mozido a Memorandum of Terms for Series D Preferred Stock Financing of Mozido, Inc. purportedly signed by “Dr. Liu Jiren” of Neusoft (the “Memorandum of Terms”), under which Neusoft proposed to invest $75 million in Mozido. The Memorandum of Terms provided that Neusoft would invest the first $25 million on or before March 31, 2015, and the remaining $50 million would be consideration for a “strategic agreement” that would provide “access to platform subscribers in China determined mutually between Mozido and Neusoft.”
FIRST CAUSE OF ACTION
Violation of Federal Securities Exchange Act of 1934 (Against all Defendants)
(a) employed devices, schemes, and artifices to defraud; (b) made untrue statements of material facts and omitted to state material facts necessary in order to make statements made, in light of the circumstances under which they were made, not misleading; and (c) engaged in acts, practices, and courses of business which would and did operate as a fraud and deceit upon Mozido, as more particularly described above.
SECOND CAUSE OF ACTION
Violation of Texas Securities Act Articles 581-33A(2) and/or 581-33F(1)-(2) (Against all Defendants)
$6.5 million loan to Appconomy, evidenced by the Pledge Agreement, is a purchase and sale of securities under the Texas Securities Act, Tex. Rev. Civ. Stat. Art. 581-1 et seq. because they constitute, among other things, a “note,” “bond,” “commercial paper,” “mortgage certificate,” “other evidence of indebtedness,” “certificate or instrument representing or secured by an interest in any or all of the capital, property, assets, profits or earnings of any company,” “investment contract,” and/or “any other instrument commonly known as a security,” as those terms are used in the definition of “security” or “securities” set forth in section 4A of the Texas Securities Act.
Stat. Art. 581-33A(2), by offering, soliciting, and/or selling securities by means of untrue statements of material facts and omissions to state material facts in order to make the statements made, in the light of the circumstances under which they are made, not misleading.
million based on months of actual financial data, when it was later discovered that Appconomy’s
revenue was $75,000.
severally liable for the remaining defendants’ violation of the Texas Securities Act, Tex. Rev. Stat.
Art. 581-33A(2).
THIRD CAUSE OF ACTION
Fraud and/or Fraudulent Inducement (Against all Defendants)
and during the term of the Loan Agreement, and the Pledge Agreement with no ability or intention to act upon or deliver upon those promises. Defendants also failed to disclose certain material facts to Mozido during the discussions and negotiations leading up to the Loan Agreement, and the Pledge Agreement and during the term of the Loan Agreement, and the Pledge Agreement with the intention of misleading Mozido.
FOURTH CAUSE OF ACTION
Negligent Misrepresentation (Against all Defendants)
App-US, Neunano, Magierski Trust, 10X Capital and/or Papermaster Trust. Therefore, App-Inc, App-US, Neunano, Magierski Trust, 10X Capital and/or Papermaster Trust are liable to Mozido based on the doctrine(s) of respondeat superior and/or vice-principal.
FIFTH CAUSE OF ACTION
Breach of Contract (Against App-US)
SIXTH CAUSE OF ACTION
Breach of Contract
(Against Papermaster, Magierski, the Magierski Trust, 10X Capital, and the Papermaster Trust)
Accordingly, the court should order Papermaster, Magierski, the Magierski Trust, 10X Capital, and the Papermaster Trust to deliver the collateral to Mozido.
SEVENTH CAUSE OF ACTION
Declaratory Judgment
(Against App-US, Papermaster, Magierski, the Magierski Trust, 10X Capital, and the Papermaster Trust)
U.S.C. § 2201-2202, Federal Rule of Civil Procedure 57 and Chapter 37 of the Civil Practice and Remedies Code of Texas, for a construction of the Loan Agreement that App-US defaulted under:
(i) Section 5.11(b) and Section 6.1(c) of the Loan Agreement as a result of App-US’s consummation, without Mozido’s consent, of an equity financing between December 22, 2014 and January 6, 2015, as such transaction is described in a Notice of Exempt Offering of Securities filed with the U.S. Securities and Exchange Commission on January 6, 2015; (ii) Section 5.3 and Section 6.1(c) of the Loan Agreement by failing to deliver quarterly Financial Reports beginning with the period ending September 30, 2014 and continuing through the present date; and (iii) Section 5.13 and Section 6.1(c) of the Loan Agreement for failure to delivery monthly Sources and Uses Reports beginning on December of 2014, and continuing through the present date.
EIGHTH CAUSE OF ACTION
Unjust Enrichment (Against all Defendants)
NINTH CAUSE OF ACTION
Conspiracy (Against all Defendants)
Defendants had a meeting of the minds on their objective, committed overt acts in furtherance of their objective, and proximately caused Mozido to sustain damages as a result thereof.
STATUTORY RIGHT TO ATTORNEY’S FEES
JURY DEMAND
PRAYER FOR RELIEF
WHEREFORE, Mozido requests that defendants be cited to appear and timely answer hereof and seeks judgment against the defendants, jointly and severally, as follows:
Respectfully submitted,
By: /s/ Constantine Z. Pamphilis Constantine Z. Pamphilis State Bar No. 00794419
Email: Dpamphilis@kasowitz.com KASOWITZ, BENSON, TORRES
& Friedman llp
700 Louisiana Street, Suite 2200
Houston, Texas 77002-2730
Telephone: (713) 220-8800
Facsimile: (713) 222-0843
ATTORNEYS FOR PLAINTIFF MOZIDO, INC.
CIVIL COVER SHEET
CONTRACT |
TORTS |
FORFEITURE/PENALTY |
BANKRUPTCY |
OTHER STATUTES |
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PERSONAL INJURY PERSONAL INJURY
PERSONAL PROPERTY
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PROPERTY RIGHTS |
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LABOR |
SOCIAL SECURITY |
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REAL PROPERTY |
CIVIL RIGHTS |
PRISONER PETITIONS |
FEDERAL TAX SUITS |
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Habeas Corpus:
Other:
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IMMIGRATION |
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(specify)
(Do not cite jurisdictional statutes unless diversity)
15 U.S.C. § 78
Securities Fraud and state statutory/common law causes of action
CLASS ACTION DEMAND $
JURY DEMAND:
06/09/2016 /s/ Constantine Z. Pamphilis
FOR OFFICE USE ONLY
I.(a)
INSTRUCTIONS FOR ATTORNEYS COMPLETING CIVIL COVER SHEET FORM JS 44
(b)
(c)
II.
III. Residence (citizenship) of Principal Parties.
IV.
V.
VI. Cause of Action. Do not cite jurisdictional
statutes unless diversity.
VII.
VIII.
Date and Attorney Signature.
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