MICAH R. JACOBS (State Bar No. 174630) JACOBS LAW GROUP SF 388 Market St,, Suite 1300 San Francisco, California 94111 ORIGINAL FILED fee (saat mv 0 am mjacobs@jacobslawsf.com LOS ANGE, SUPERIOR COURT Attorneys for Defendant and Cross-Ct omplanants TONY MICHAEL and POWER DI MARKETING, INC. IN THE SUPERIOR COURT OF THE STATE OF CALIFORNIA COUNTY OF LOS ANGELES, NORTHWEST DISTRICT VAN NUYS COURT ONLINE COMMUNICATIONS, LLC, Case No. LC094728 Plaintiff, FOURTH AMENDED CROSS- COMPLAINT FOR: v. @) BREACH OF WRITTEN ‘TONY MICHAEL, CONTRACT; @)_ INTENTIONAL INTERFERENCE Defendant, WITH CONTRACTUAL | RELATIONS; @ INTENTIONAL INTEREFERENCE, *ROSPECTIVE ECONOMIC ADVANTAGE: Ds (4) FRAUD; and (8) PROMISSORY ESTOPPEL ‘TONY MICHAEL, an individual, and POWER DIRECT MARKETING, INC., a ‘Nevada corporation, Cross-Complainants, v. ONLINE COMMUNICATIONS, LLC; JASON CARAMANIS (ROE 1), and ROES 2-10, Cross-Defendants. Fourth Amended Cross-ComplaintSo we a aw een ul 12 13 14 15 16 17 18 19 20 a 2 23 24 25 26 20 28 Defendant and now Cross-Complainant TONY MICHAEL and Cross-Complainant POWER DIRECT MARKETING, INC. (hereinafter collectively referred to as “Cross- Complainants”) hereby file this Fourth Amended Cross-Complaint against Plaintiff and Cross- Defendant ONLINE COMMUNICATIONS, LLC, and Cross-Defendant JASON CARAMANIS (ROE 1) (collectively “Cross-Defendants”) and Roes 2-10, as follows: ‘THE PARTIES L Plaintiff, Online Communications, LLC is, and at all relevant times was, a Wyoming corporation, apparently owned by Jason Caramanis. Cross-Defendant Jason Caramanis was the principle actor who participated in the events that led to this lawsuit. At all relevant times, he has been a resident of Woodland Hills, California. 2. Defendant Tony Michaelis, and at all relevant times herein was, a resident of ‘Addison, Texas. He owns Power Direct Marketing, Inc., a Nevada corporation. He is also an intended third party beneficiary of the agreements and claims alleged herein. 3 Cross-Complainant Power Direct Marketing, Inc. is, and all relevant times was, a ‘Nevada corporation. GENERAL ALLEGATIONS 4 Defendant and now Cross-Complainant Tony Michael (hereinafter “Mr. Michael” or “Cross-Complainant”) hereby files this Fourth Amended Cross-Complaint against Cross- Defendant Online Communications LLC (hereinafter “Online Communications” or “Cross- Defendant”) and Jason Caramanis for breach of contract, intentional interference with contract, intentional interference with prospective economic advantage, fraud, and promissory estoppel. 3. Mr. Michael, on behalf of Power Direct Marketing, Inc. entered into a written contract on May 10, 2010 (“Agreement”) with Jason Caramanis, purportedly acting on behalf of Online Communications for Jason Caramanis to provide services to Tony Michael's position in MonaVie. Tony Michael was the intended third party beneficiary of this Agreement. Cross- Defendants knew that Mr. Michael was the sole and beneficial owner of Power Direct Marketing, Inc., and that he alone would benefit from Jason Caramanis’ services promised under Fourth Amended Cross-Complaint Page 2ee ee 10 Ml 12 3 14 15 16 17 18 19 20 2 2 23 24 25 26 27 28 the Agreement, When Online Communications issued checks in the amount of $50,000 as specified in the Agreement, the checks were made out directly to Tony Michael, not Power Direct Marketing. Indeed, Online Communications sued Tony Michael individually when it filed its Complaint for Breach of the same Agreement, and now it alleges that Tony Michael is the alter ego of Power Direct Marketing. The negotiations for the Agreement took place between Jason Caramanis and Tony Michael, and each knew that they were making an agreement to benefit the other individually, not their respective corporate entities. Indeed, Tony Michael agreed to hire Jason Caramanis, who is a leader in the industry, to build his position in MonaVie, not Online Communications. It was Jason Caramanis’ personal services that were to be provided to Tony Michael under the Agreement. The parties knew that Tony Michael was the intended third party beneficiary of the Agreement, and thus Tony Michael has standing to pursue individual claims for breach of the Agreement. Just prior to the execution of the ‘Agreement in May 2010, Jason Caramanis, acting with purported authority on behalf of Online Communications, made several false representations and promises to Mr. Michael who was acting for Power Direct Marketing, Inc., in which Mr. Caramanis sought to fraudulently induce Mr. Michael to enter into the Agreement with Online Communications. Pursuant to the Agreement, Online Communications represented and agreed it was being hited expressly “for the purpose of selling and promoting MonaVie products and business, and {to] sponsor others into the MonaVie business in accordance with the terms of effective MonaVie Policies and Procedures (the “Services”)” and to increase the position’s rank within MonaVie to the level required to allow the position to be transferred. Under the Agreement, Online Communications represented it would invest in and manage Power Direct Marketing's interest in the MonaVie business and increase the position in rank to the rank required by MonaVie to allow the position tobe transferred, A true and correct copy of the Agreement is attached hereto as Exhibit A and incorporated as if it were fully set forth herein. 6. ‘The Agreement contained affirmative express representations from Jason Caramanis, purportedly on behalf of Online Communications, in which Online Communications promised to pay Mr. Michael $50,000 as consideration for working with and managing Mr. ——— Fourth Amended Cross-Complaint Page 3a won Seen au MW 12 B 14 15 16 7 18 19 20 21 2 23 24 25 26 27 28 Michael's established business, network and customers, in exchange for the rights to receive income from Mr. Michael's business. The Agreement expressly states, and Mr. Caramanis expressly represented to Mr. Michael, that Online Communications would pay Mr. Michael $30,000 upon execution of the Agreement, $10,000 on May 18, 2010, and $8,000 on May 25, 2010, and that Online Communications would market, promote, develop and grow Mr. Michael’s network, revenues, and position in the MonaVie program such that it would generate significant income for Cross-Complainants. As the purported agent for Online Communications, Jason Caramanis further represented orally and in writing in April and May 2010, including affirmative representations in the written Agreement itself, that Jason Caramanis and Online Communications would increase Mr. Michael’s distributorship’s customer base, sales, and revenues, and grow it until the revenues reached the position of rank required by MonaVie and its policies and procedures (at the time of the Agreement) to transfer Mr. Michael's distributorship business to Online Communications. When Online Communications helped Cross-Complainant’s business reach the rank under MonaVie's policies to allow the business to be sold, ownership of Mr. Michael’s position at MonaVie would be transferred to a new entity owned equally by both parties to the Agreement. The Agreement specified that after ownership ‘was transferred, the parties would then split all income earned from the business equally. Jason Caramanis represented orally and in writing to Mr. Michael in May 2010, that he and Online ‘Communications would build Mr. Michael’s distributorship such that Mr. Michael would receive significant income after the business achieved the necessary rank, and Mr. Michael would receive fifty percent (50%) of all income from the business after that time. 1. Rather than performing its/his contractual obligations to market and build Mr. Michael’s business, however, Online Communications and Jason Caramanis promptly repudiated the Agreement, and never fulfilled its contractual obligations. Online Communications, and Jason Caramanis, refused to invest the promised monies in marketing necessary to grow the business to the level set forth in MonaVie’s policies necessary to transfer ownership, as promised in the Agreement. Rather, Mr. Caramanis and Online Communications created a ruse to cancel the Agreement after it gained access to Mr. Michael’s business nn SS OO eS Fourth Amended Cross-Complaint Page 4ee aa 10 i 12 13 14 15 16 17 18 19 20 21 2 2B 24 25 26 2 28 customers/distributors, and fleeced the distributorship of its top customer/distributor. 8 Online Communications and Jason Caramanis further conspired with Mr. Michael's top distributor, Parvis Parvizi, taking Mr. Parvizi and his entire down-line stream to join a competing distributorship, and partner with Online Communications, in order to deprive Mr. Michael and Power Direct Marketing of their rightful income from the Mona Vie position. In fact, Jason Caramanis and Online Communications never intended to perform the promises and representations set forth in the written Agreement, and never intended to invest in, market and grow Mr. Michael's business, as promised, and instead simply wanted to acquire access to Mr, Michael’s customers/distributors for the purpose of cross-recruiting them to a competing business. 9. Further, Online Communications paid Mr. Michael only $32,000 of the required $50,000, and then refused to perform any further services to promote and sell the MonaVie products or support distributors for Mr. Michael as promised. Although Jason Caramanis, on behalf of Online Communications, wrote checks totalling $50,000 to Power Direct Marketing, the checks were cancelled before Mr. Michael even had a chance to deposit them. 10. Atal times, Mr. Michael and Power Direct Marketing were ready, willing, and able to continue performing under the terms and conditions of the parties’ written Agreement. Indeed, Mr. Michael and his counsel repeatedly proposed to Online Communications and Jason Caramanis that they restore the Agreement and that Online Communications and Jason Caramanis perform their agreed-upon promises set forth in the Agreement. However, Online Communications and Jason Caramanis repudiated the Agreement and refused to perform its obligations under the Agreement. Mr. Michael lost his most significant customer and lost significant income as a result of Jason Caramanis’ and Online Communications’ false promises and wilful breach of contract. 11. Mr, Michael has at all times performed all of the conditions and promises required of him under the Agreement, and stood ready, willing, and able to perform in accordance with the terms and conditions of the Agreement. 12. From January 2010 to May 2010, before entering into the Agreement with Online Leone EEE OT! Fourth Amended Cross-Complaint Page Swe wD 10 W 12 13 14 15 16 7 18 19 20 2 22 2B 24 25 26 2 28 Communications and during the time Mr. Michael was in sole control of the distributorship, Mr. Michael’s distributorship was consistently growing in income and sales, and distributorship profits were consistently increasing. However, Mr. Michael's sales declined 70% in the first seven weeks, from May 2010 to July 2010, immediately after Online Communications and Jason Caramanis entered into the Agreement and took over management and operations of Mr. Michael's distributorship. In fact, Mr. Michael’s biggest customer, Parvis Parvizi, left Mr. Michael's network as a direct result of Online Communications and Jason Caramanis’ unlawful interference and illegal cross-recruiting. 13. Mr. Michael is informed and believes, and on that basis alleges, that Online Communications and Jason Caramanis never intended to perform the promises and obligations promised in the Agreement as consideration for taking control of Mr. Michael’s distributorship, Instead, soon after entering into the Agreement in May 2010, Online Communications, through Jason Caramanis, started a new distributorship with a competitor, and invested its time and ‘monies growing that competing business from zero income to over $200,000 a month, which further indicates that Online Communications and Jason Caramanis did not use reasonable efforts to grow Mr. Michael’s business, as promised. 14, Mr. Michael is informed and believes, and on that basis alleges, that Online Communications misappropriated Mr. Michael’s customers and distributors, and specifically Parvis Parvizi and his entire downstream group of distributors and customers, and transferred them to another competing businesses and/or distributorships run by Online Communications either at MonaVie, or at another company altogether. 15. Inshort, not only did Online Communications and Jason Caramanis breach the ‘Agreement by not fulfilling their obligations and promises to market and grow Mr. Michael's network in order to reach the MonaVie rank required to transfer ownership of Mr. Michael's position, Online Communications and Jason Caramanis never intended to perform those obligations and instead, fraudulently induced Mr. Michael to enter into the Agreement for the sole purpose of gaining access to Mr. Michael’s distributorship contacts, with intent of taking Mr. Michael's business and distributorship, and stealing Mr. Michael’s customers, specifically _—_—_—_—_—_—— ee Fourth Amended Cross-Complaint Page 6we A 10 u 12 13 4 15 16 7 18 19 20 21 22 2B 24 25 26 a 28 Parvis Parvizi, by illegally cross-recruiting them to a competing business. Had Mr. Michael known the truth, he never would have entered into the Agreement with Online Communications and Jason Caramanis. First Cause of Action Breach of Written Contract 16. Cross-complainants hereby incorporate the allegations of all prior paragraphs of this Cross-Complaint as though they were fully set forth herein. 17. Online Communications and Jason Caramanis materially breached the Agreement by failing to pay the entire $50,000 due and owing to Mr. Michael. Online Communications paid only $32,000 to Mr. Michael, and then it put a stop payment on the other checks, refusing to pay the outstanding balance of $18,000 due and owing to Mr. Michael. 18. Online Communications breached the Agreement by refusing to perform its ‘material obligations under the Agreement to invest in marketing, selling, and promoting Mr. Michael's business to new customers and new distributors to grow the business to the level of sales required by MonaVie policies and procedures to qualify to transfer or sell the business to a new entity, and specifically Online Communications. Online Communications and Jason Caramanis breached the Agreement by failing to use any, let alone commercially reasonable efforts to sell and promote MonaVie products under Mr. Michael's business after the Agreement was executed. Online Communications also breached the obligation of good faith and fair dealing implied in every Agreement by refusing to perform its obligations under the Agreement. 19. Atal times, Mr. Michael materially performed all of his obligations under the ‘Agreement, until after Online Communications and Jason Caramanis repudiated its obligations under the Agreement. At that time, Mr. Michael refused to provide any of the sales to Online ‘Communications because Online Communications and Jason Caramanis repudiated their obligations to invest in, market, and grow Mr. Michael's business, which was the basis for Online Communications’ right to receive any income from Mr. Michael. 20. Mr. Michael has been significantly damaged as a result of Online rT Fourth Amended Cross-Complaint Page 7Ce yaw eon 10 u 12 13 14 15 16 7 18 19 20 2 2 2B or 25 26 27 28 Communications’ and Jason Caramanis’ various material breaches of the Agreement in an amount to be proven at trial but which is well in excess of $500,000, which damages include: (1) the loss of income and revenue that was reasonably expected had Online Communications and Jason Caramanis performed pursuant to the Agreement and grew the business to the level specified in the MonaVie policies and procedures to qualify to transfer ownership of Mr. Michael’s business to Online Communications and Jason Caramanis, and (2) the loss of existing revenues caused by Online Communications and Jason Caramanis misappropriating Mr. Michael’s top customer, Parvis Parvizi and his organization of distributors and customers, which were generating significant income for Mr. Michael and improperly taking them to a competing business. Second Cause of Action Intentional Interference with Contractual Relations 21. Cross-complainants hereby incorporate the allegations of all prior paragraphs of this Fourth Amended Cross-Complaint as though they were fully set forth herein 22. Mr. Michael had contracts in place with all of the distributors and customers in his distributorship, and specifically had an extremely valuable contractual relationship with Parvis Parvizi. Online Communications and Jason Caramanis had knowledge of the agreements Mr. Michael had with his distributors and specifically with Parvis Parvizi. Indeed, Jason Caramanis was communicating directly with Parvis Parvizi prior to entering into the ‘Agreement. Mr. Michael is informed and believes and on that basis alleges that prior to entering into the Agreement, Online Communications and its owner and control persons Jason Caramanis and his fiancée, Diane Beltran (who had several aliases), and Parvis Parvizi conspired to defraud Mr. Michael of his distributorship and his contractual rights with Parvis Parvizi. 23. After Mr. Michael and Jason Caramanis entered into the Agreement, at the behest of Online Communications and Jason Caramanis in order to satisfy Mr. Parvizi's request for support, an Agreement whereby Jason Caramanis was required to sell and promote Mr. Michael’s business distributorship and support its distributors, including Parvis Parvizi, Online _—$— Fourth Amended Cross-Complaint Pageee) 10 in 12 1B 14 15 16 7 18 19 20 2 2 23 24 25 26 27 28 ‘Communications and Jason Caramanis instead induced Mr. Michael's lead distributor, Parvis Parvizi to leave Mr. Michael’s business with his entire downstream group of distributors and customers, and join a competing business with Online Communications. Cross-complainants are informed and believe that Online Communications and Jason Caramanis also induced other distributors to leave Mr. Michael’s business and join Online Communications or Jason Caramanis. They will seek leave to amend this Fourth Amended Cross-Complaint after discovery identifies the names of other specific distributors or customers with whom Online ‘Communications and Jason Caramanis interfered, if any, other than Parvis Parvizi. 24. Online Communications and Jason Caramanis intended to disrupt and interfere with Cross-Complainant’s distributorship agreements and take Mr. Michael’s customers, specifically including Parvis Parvizi, for its own benefit. 25. Online Communications and Jason Caramanis intentionally interfered with the performance of such Third Party Agreements and specifically Mr. Michael’s agreements with Parvis Parvizi. 26. Mr. Michael has been damaged as a result of Online Communications’ and Jason Caramanis’ interference in an amount to determined and proven at trial, but which damages are at least $500,000 as a result of lost future earnings and loss of customers. qT Cause of Ac Intentional Interference with Prospect 27. Cross-Complainants hereby incorporate the allegations of all prior paragraphs of this Fourth amended Cross-Complaint as though they were fully set forth herein, and specifically incorporate the allegations of the Fourth Cause of Action for Fraud as if they were fully set forth here 28. Mr. Michael and Power Direct Marketing, Inc. enjoyed economic relationships with the distributors and customers in their distributorship who were generating sales and revenues for Mr. Michael and were also expected to generate new customers and new distributors who would have resulted in continued growth for Mr. Michael’s business and thus —— arssnnnnnenennnEannEEEEET eT Fourth Amended Cross-Complai Page 9Ce a an ew 10 uM 12 13 14 15 16 7 18 19 20 21 22 23 24 25 26 27 28 increasing prospective economic benefits to Mr. Michael as a result of their efforts to build their own networks within Mr, Michae!’s distributorship. 29. Online Communications and Jason Caramanis, fully aware of Mr. Michael’s business and his relationships with his customers, distributors, and the prospective economic benefits they would continue to produce for Mr. Michael, fully intended to disrupt these relationships, and did in fact disrupt these relationships. Online Communications and Jason Caramanis engaged in independently tortious and fraudulent conduct by making false representations to Cross-Complainants to induce them to enter into the Agreement, which is. alleged in more detail in the Fourth Cause of Action below and in paragraphs 5-7, above. Such independent wrong includes falsely representing that it was prepared to manage, invest in, and grow Mr. Michae!’s business when in truth Online Communications and Jason Caramanis had no intention of doing so. These misrepresentations as alleged below and above, made by Jason Caramanis allegedly on behalf of Online Communications, were made to fraudulently induce Mr. Michaels to enter into the Agreement, and constitutes fraud. Online Communications and Jason Caramanis also engaged in wrongful conduct through its improper cross-recruiting of Mr. Michael's distributors, and specifically Parvis Parvizi, to join other competing businesses and distributorships. 30. Mr. Michaels relationships with his existing distributors and customers, the prospective economic benefits from those relationships, as well as Mr. Michael's expected new customers and new distributors, were all relationships that were disrupted by the tortious and fraudulent conduct of Online Communications and Jason Caramanis as alleged herein. 31. Mr. Michael lost significant potential income and profits, and was harmed as a result of Online Communications’ conduct. 32. Online Communications’ and Jason Caramanis’ wrongful conduct was a substantial factor in causing Mr. Michael’s harm and loss of prospective economic benefits, Nee eT Fourth Amended Cross-Complaint Page 10Cer aneon 10 u 12 13 14 15 16 17 18 19 20 21 22 2B 4 25 26 27 28 Fourth Cause of Action Fraud 33. Cross-Complainants hereby incorporate the allegations of all prior paragraphs of this Fourth amended Cross-Complaint as though they were fully set forth herein. 34, Prior to entering into the Agreement, between January 2010 and April 2010, Jason Caramanis, acting with purported actual authority on behalf of Online Communications, affirmatively represented to Mr, Michael orally and in writing that he and Online ‘Communications would invest significant time and money to grow, market, promote and develop Mr. Michael’s business to the level required to reach the rank necessary under the MonaVie policies and procedures to qualify Mr. Michael’s distributorship to be able to be sold or transferred to Online Communications, at which time Mr. Michael would be entitled to 50% of all sales revenue earned by the distributorship. During that time, Jason Caramanis| specifically represented to Mr. Michael that he would invest his own time, money, and expertise to build Mr. Michael’s distributorship to the level required by MonaVie for transfer of ownership, at which point Mr. Michael would earn significant income from the joint ownership. 35, Jason Caramanis and Online Communications’ representations that they were prepared to invest in, market and grow Mr. Michael’s business were in fact false at the time they were made. The representations were made only to fraudulently induce Mr. Michael to enter into the Agreement so that Mr. Caramanis and Online Communications could gain access to Mr. Michael’s customers and distributors, who they then improperly cross-recruited to another competing business, as alleged in more detail above. Jason Caramanis speaking for Online Communications made the false representations without any intention of performing the promises set forth in the Agreement. In truth, at the time Online Communications and Jason Caramanis represented that Online Communications would invest additional funds to support Mr. Michael’s existing distributors and grow the business, Online Communications and Jason Caramanis had no intentions of doing so but rather only wanted access to Mr. Michael's distributors and Parvis Parvizi in particular. 36. Online Communications and Jason Caramanis made such false promises during a ae Fourth Amended Cross-Complaint Page 11the negotiations that preceded the Agreement to further obtain access to Mr. Michael’s income and revenues, and customers and distributors, for their own purposes of depleting Mr. Michael’s business of all income, and then transferring such customers and distributors to Online Communications’ competing businesses. 37. Online Communications and Jason Caramanis intended that Mr. Michael rely on its misrepresentations, and Mr. Michael did reasonably rely on such misrepresentations. 38. Jason Caramanis, who allegedly acted on behalf of and for Online Communications, acted with conscious disregard of Mr. Michael's rights. His fraudulent misrepresentations designed to induce Mr. Michael to enter into the Agreement to fleece his business were despicable, wilful, and fraudulent, and justify the award of punitive damages. 39. Mr. Michael has been damaged as a result of Online Communications’ fraudulent misrepresentations in an amount to determined and proven at trial, but which damages are at least $500,000 as a result of lost future earnings and loss of customers. Fifth Cause of Action Promissory Estoppel 40. Cross-Complainants hereby incorporate the allegations of all prior paragraphs of this Fourth Amended Cross-Complaint as though they were fully set forth herein. 41 During the months of April and May 2010, Jason Caramanis made numerous promises and representations to Cross-Complainants with regard to Mr. Michael’s distributorship in the MonaVie network, to wit: Jason Caramanis promised that if Cross- Complainants would hire him and tun his distributorship over to Jason Caramanis, he and Online Communications would pay Cross-Complainants $50,000 up front in exchange for all income for 12-16 months, during which time, Mr. Caramanis would actively manage, invest in, ‘market, and grow Mr. Michael’s network and distributorship and would increase its rank in MonaVie up to the ranking required by MonaVie for the position to be eligible for transfer, at which point the parties would split the promised substantially increased income/commissions ‘eared from the position 50/50 thereafter. Cross-Complainants reasonably relied on Jason Fourth Amended Cross-Complaint Page 12Caramanis’ promises to grow and increase the rank of the MonaVie position, and tumed his distributorship over to Jason Caramanis and Online Communications. 42. Cross-Defendants’ intent was communicated to Cross-Complainants both orally and in writing, and was then specifically manifested in the May 10, 2010 Agreement. Cross- Defendants’ promises and representations were clear, unambiguous, and further manifested clearly and expressly in the Agreement. 43, Cross-Complainants relied upon Online Communications’ and Jason Caramanis’ said promises and representations and did turn over their entire distributorship position in MonaVie to Jason Caramanis, in exchange for his promises to increase the position’s rank in MonaVie, and then split the substantially increased position from the improved rank 50/50 thereafter. 44. Online Communications and Jason Caramanis should have expected, and did expect, a substantial change of position by Cross-Complainants in reliance upon said promise. Cross-Complainants’ change of position was foreseeable to Online Communications and Mr. Caramanis, as they then took over all income in the position for the stated and promised purpose of managing it, promoting it, and increasing its rank in MonaVie for the purpose of substantially increasing its income. 45. Online Communications and Jason Caramanis then repudiated their obligations as promised and expressly stated in the Agreement. More importantly, Cross-Defendants failed to increase the position’s rank in MonaVie, and instead cross-recruited distributors out of Cross- Complainants’ distributorship and over to another competitor's company, taking the distributors for themselves, leaving Tony Michael’s position in worse shape, and depriving Cross- Complainants of the benefit of their bargain. 46. Cross-Complainants at all times were ready, able and willing to perform all of the terms and conditions of said Agreement, and did perform. 47. Cross Complainants made a complete and substantial change of position in reliance upon Online Communications and Jason Caramanis’ promises and representations by tuming over management of their distributorship to Jason Caramanis and Online ————— Fourth Amended Cross-Complaint ; Page 13cy ees) 10 u 12 13 14 15 16 7 18 19 20 21 22 23 24 25 26 27 28 ‘Communications, all to their detriment as Online Communications and Mr. Caramanis did not provide Cross-Complainants with the full $50,000, did not market and grow the position or increase its rank in the distributorship to the specified level, and yet Online Communications and Mr, Caramanis then made away with valuable confidential contacts and private and confidential network and distributorship information and took Mr. Michael’s downline distributors to a competitor's company, for their own benefit and to the detriment of Cross-Complainants. 48. Cross-Complainants have been damaged as a result of their justifiable, reasonable, and foreseeable reliance on Online Communications’ and Mr. Caramanis’ promises and misrepresentations in an amount to determined and proven at trial, but which damages are at least $500,000 as a result of lost future earnings and loss of customers. PRAYER FOR RELIEF WHEREFORE, Cross-Complainants Tony Michael and Power Direct Marketing, Inc. pray for the following relief: 1. An award of actual, proximate and consequential damages against Online Communications, LLC and Jason Caramanis in an amount according to proof at trial, plus pre-judgment interest, post-judgment interest, and all other relief that this Court deems reasonable; 2. Anaward of punitive and exemplary damages against Online Communications, LLC and Jason Caramanis; and 3. Any other and additional relief the Court deems just and appropriate. Dated: November 6, 2014 JACOBS LAW GROUP SF laaant By: ___ Micah R. Jacobs Attorneys for Defendant/Cross-Complainant TONY MICHAEL and Cross-Complainant POWER DIRECT MARKETING, INC. Fourth Amended Cross-Complaint Page 14Business Center Income ‘Transfer Agreement THIS AGREEMENT is made this 10% day of May, 2010 by and between Tony Michael, representing Power Direct Marketing (“PDM"), and Online Communications LLC, (“OCLLC”), herein collectively referred to as the “Parties” or individually as a “Party. WHEREAS, the Parties acknowledge that PDM desires to transfer its interest in income in the ‘MonaVie distributorship position for a period of 16 Months (Sixteen Months), currently held in the name of Power Direct Marketing, to OCLLC; WHEREAS, the Parties acknowledge that MonsVie prohibits the sale ot transfer of istributorships until such time that the distributorship position reaches a designated rank within the MonaVie Compensation Pay Plan; WHEREAS, PDM desires to: hire OCLLC to perform services relaied to the MonaVie distsibutorship held by PDM until such time as the distributorship obtains the rank required by ‘MonaVie's internal policies for a formal transfer of ownership to OCLC; NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants hereinafter set forth, the Parties hereto agree as follows: 1. OCLLC Services. PDM hereby agrees to retain OCLLC for the purpose of selling and jromoting the MonaVie products and business, and sponsor others into the MovaVie business in ocordance with the terms of the effective MonaVie Policies and Procedures (the “Services”), PDM transfers the use of the income and Hcount card, with the PIN code used and attached to said ID # 1696937 for the purposes of expenses and payments issued to OCLLC. 2. QCLLC Compensetion. . PDM agrees to pay OCLLC any and all compensation rogardless of form eared by PDM under the MonaVie Compensation Plan, including but not limited to commissions, overrides, bonuses, incentives, commission pools, and/or other rewards, tips or incentives, and recognition of person (the “Compensetion”). All Compensation paid from PDM to OCLLC shall be 1099 income end PDM shall 1099, according to the IRS tax code, any and all monies 1099 by Monavie to PDM, shall be passed dizectly along to OCLLC in the form of a 1099 at the end of the year, unfess documented receipts for tex purposes of expenses for product purchases, flights, hotels, meeting rooms, and meals that are allowed by the IRS tax code shall be deducted first and any ‘nd all remaining monies shall be paid to OCLLC as 1099 income as consulting compensation for services rendered, 3. Term for Services. OCLLC shell continue to perform such Services until such time as the MonaVie distributorship held by PDM (the “Position”) obtains the rank necessary to qualify the istibutorship for transiec, Por a period defined above as 16 (Sixteen) Months end Upon signing of ‘his agreement PDM transfers the rights to the income generatsd by PDM within Monavie i He 4020 ID number 1696937. exineiT “A”4. Fess, OCLLC agrees to pay PDM $50,000.00 (Fifty Thousand Dollars) as an advance payment to enable PDM to have immediate cash to operate other MLM busitiess activities, as well as the use of funds for personal reasons. The distributorship in Monavie known 2s PDM, identification number 1696937 within the Monavie business, shall be operated and maintained by OCLLC, and upon achieving the rank required by MonaVie to qualify a position as transferable, PDM agrees fo transfer such position to OCLC or its’ assignees and perform all required actions as may be designated by MonaiVie to effect such transfer, This transfer does not negate or obviate this agreement or any pat of this agreement especially pertaining to the equity shared at the end of the period 16 (Sixteea) Months by PDMand OCLLC. 5. Payments. OCLLC agrees to pay PDM upon execution of this said agreement $30,000.00 (Dhisty Thousand Dollars). The retaining $20,000.00 (Twenty Thousand Doliars) shall be paid accordingly. (a) Payment of $10,000.00 (Ten Thousend Dollars) on May 18", 2010 (b) Payment of $8,000.00 (Bight Thousand Doliers) on May 25", 2010 (© Power Direct Marketing owes OCLLC from previous agreements currently as of this date ‘of the contract $2,000.00 (Two Thousand Dollars) so this emount previously owed by PDM to OCLLC is applied to this agreement and considered 6. Transfer. Once the Position achieves the rank required by MonaVie to qualify a povition as transferable, PDM agrees to transfer the distrbutorship ID # 1696937 into e new entity wihere ownership will be split between PDM (or its assignees) and OCLLC (or its assignees) equally. PDM will perform ell required actions as may be designated by MonaVie to effect such transfer. 7. _ Equity Participation. The Parties agree that upon the completion of 16 (Sixteen months) on September 10" , 2011 that jointly the position identification number in Monavie known as 1696937, regardless of whomever holds ttle to the distibutorship, income received shall be split equally amongst the Parties 50% (Fifty Percent) for each party. This will be excluding all maintenance fees which will be dedueted prior to any monies being split from distributorship ID # 1696937 within Monevie, PDM shall either have the right to have the monies every month sent to his designated ‘account duo and payable at the 5" of each and every month for the previous month income. PDM shall cleot to be 1099 income at the end of the year or PDM and OCLLC shall elect to set up a 50/50 equity LLC that shall be named as the transferable entity within Monavie. -OCLLC shall refer a named party fat shall be the person or entity that holds interest of 50% (Fly Percent) and PDM mutually agree upon this. 8, Miscellaneous. (@, Suovessors and Assigns. This Agreement shall bind and shall insure to the benefit of all Parties and eny and all ofits successors whether by merger, consolidation, transfer of substantially all assets or similar transaction, and it shall bind the Parties and their heirs and lege! representatives, (6) Waiver of Breach. The waiver by any Party of a breach of any provision of this. shall not operate or be construed as a waiver of any subsequent breach, ARN: 2, ps 2 : Ain ot 440 »(©) Partial Invalidity. If any provision of this Agreement is held by @ court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions shall nevertheless continue Jn fall force without being impaired or invalidated in any way. @ Governing Law. The validity of this Agreement and the interpretation and performance of all ofits terms shall be govemed exclusively by the laws of California without regard to the application of California’s principles of conflict of laws. (©) Remedies, The parties agree that in the event of the breach or threatened breach by any Porty of any one or more of the covenants set forth in this Agreement, the other Party or Parties would not have any adequate remedy at Jaw. Accordingly, in the event of any such breach or threatened breach, such other Party or Parties may, in addition to the other remedies which may be available to it, file a suit in equity to enjoin the breaching Party from such breach or threatened breach. (Q NomDisclosure. Parties hereby agree that the torms of this Agreement shall be kept confidential and shall not be disclosed to the public or any other individual or entity, except as directed by Jaw or ordered by a court maintaining jurisdiction over this Agreement. (g) Negotiations. This Agreement is the result of an arms-length bargain between the parties. Both parties participated in the drafting of this Agreement and had input into its terms such that if there is any ambiguity as to the terms of this Agreement, this ambiguity sball not be construed against either party. ” (i) Independent Contractor, This Agreement shall not create the relationship of employer and employes; a partnership, a joint venture or agency between OCLLC and PDM. PDM shall not control or direct the details or means by which OCLLC performs the Services requised herein except as expressly provided herein. INWITNESS WHEREOF, the undersigned have executed this Agreement as of the date first above written. OnbebalfofPower Direc Maketings §— Wig : S50:10 Tonf Michael“ ‘On behalf of Online Communications LLC: By Jesor ‘ManagerSoe a auawn B iW 12 B 14 15 16 17 18 19 20 2 22 23 24 25 26 27 28 PROOF OF SERVICE I declare that I am over the age of eighteen (18) years and not a party to the within action. My business address is 388 Market Street, Suite 1300, San Francisco, CA 94111. On the date set forth below, I served the following document(s): SUMMONS, and FOURTH AMENDED CROSS-COMPLAINT FOR: (1) BREACH OF WRITTEN CONTRACT (2) INTENTIONAL INTERFERENCE WITH CONTRACTUAL RELATIONS, (3) INTENTIONAL INTEREFERENCE WITH PROSPECTIVE ECONOMIC ADVANTAGE (4) FRAUD; and (5) PROMISSORY ESTOPPEL By Mail: by placing true and correct copies of the document(s) listed above in envelope(s) addressed as set forth below. I sealed said envelope(s), with postage thereon fully prepaid, to be deposited with the United States Postal Service on this date following ordinary business practice. I am readily familiar with office procedure and practice for collection and processing of correspondence for mailing. By E-Mail: by causing such documents to be sent to attorney Bimali Walgampaya by attaching said documents to an email specifically addressed to bimali@w-wlaw.com from the email account at Jacobs Law Group SF, B By Overnight Service: by placing the document(s) listed above in a sealed envelope for overnight deliver via FedEx or other overnight service, with fees fully prepaid, and deposited for same-day pickup by an authorized representative. By Hand Delivery: by placing the document(s) listed above in a sealed envelope(s) and submitting such envelope(s) to a messenger service with instructions to the messenger service representative that the envelopes(s) be delivered as set forth below by 5:00 p.m. and that said messenger service provide my office with confirmation of such delivery(ies). Bimali Walgampaya WELLMAN & WARREN LLP 24411 Ridge Route, Suite 200 Laguna Hills, CA 92653 Tel: (949) 580-3737 I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct. Executed on November © , 2014 at San Francisco, California.