Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Alpha Capital Anstalt v. Shiftpixy, Inc.

United States District Court, S.D. New York

January 9, 2020

ALPHA CAPITAL ANSTALT, Plaintiff,
v.
SHIFTPIXY, INC., Defendant.

          ORDER

          PAUL G. GARDEPHE, UNITED STATES DISTRICT JUDGE

         On October 4, 2019, Plaintiff Alpha Capital Anstalt moved for summary judgment in this breach of contract action against Defendant Shiftpixy, Inc. (Dkt. No. 30) On October 22, 2019, this Court referred the motion for summary judgment to Magistrate Judge Robert Lehrburger for a Report and Recommendation (“R&R”). (Dkt. No. 38) Judge Lehrburger submitted his R&R on November 22, 2019. (R&R (Dkt. No. 41)) For the reasons stated below, the R&R will be adopted in its entirety, and Plaintiff's motion for summary judgment will be granted.

         BACKGROUND

         I. FACTS

         Plaintiff is an investment entity organized under the law of Liechtenstein. (Pltf. R. 56.1 Stmt. (Dkt. No. 32) ¶ 1) Defendant is a Wyoming corporation with its principal place of business in California. (Id. ¶ 2)

         On March 12, 2019, Plaintiff purchased a Senior Convertible Note (the “Note”) from Defendant in the amount of $1, 266, 667, pursuant to a Securities Purchase Agreement. (Id. ¶ 5) The Note gives Plaintiff the right to convert any portion of the Note to Defendant's common stock. (Id. ¶ 6)

         On May 16, 2019, May 29, 2019, May 30, 2019, and June 3, 2019, Plaintiff submitted conversion requests, which Defendant honored. (Id. ¶ 7) On June 20, 2019, Plaintiff submitted its fifth conversion request, asking to convert $310, 000 of the Note into one million shares of Defendant's common stock. (Id. ¶ 8) To date, Defendant has not honored that request. (Id.) In a June 27, 2019 Form 8-K filing, Defendant announced that it would no longer honor conversions of any senior convertible note, including the Note at issue in this action. (Id. ¶ 9) Defendant's Form 8-K states that “[t]he Company has informed its convertible note holders that it will cease honoring conversion requests of the 2018 and 2019 Notes forcing a voluntary default of these instruments.” (Id.)

         In the Note, Defendant agrees that

a breach by it of its obligations hereunder will cause irreparable harm to [Plaintiff] and that the remedy at law for any such breach may be inadequate. [Defendant] therefore agrees that, in the event of any such breach or threatened breach, the Holder shall be entitled . . . to specific performance and/or temporary, preliminary, and permanent injunctive . . . relief . . . without posting a bond or other security.

(Id. ¶ 10)

         II. PROCEDURAL HISTORY

         The Complaint was filed on July 3, 2019 (see Cmplt. (Dkt. No. 1)), and the Amended Complaint was filed on July 30, 2019. (Am. Cmplt. (Dkt. No. 14)) Plaintiff alleges that Defendant breached its obligations under the Note, and that Defendant has also committed an anticipatory breach of the Note. (Id. ¶¶ 17, 24)

         In the Complaint, Plaintiff moved for a preliminary injunction directing Defendant to (1) deliver one million shares of its stock to Plaintiff, thereby honoring the June 20, 2019 conversion request; and (2) honor all future conversion requests submitted by Plaintiff under the Note. (Cmplt. (Dkt. No. 1) at 9) [1] On July 25, 2019, this Court denied Plaintiff's motion for a preliminary injunction. (Dkt. No. 12) On August 2, 2019, Defendant filed counterclaims for breach of contract and unjust enrichment in connection with Plaintiff's alleged receipt and subsequent sale of Defendant's shares. (Dkt. No. 20)

         On October 4, 2019, Plaintiff moved for summary judgment on its breach of contract claim and on Defendant's counterclaims. Plaintiff seeks an order directing Defendant to deliver to Plaintiff one million shares of its common stock, and requiring Plaintiff to honor all future conversion requests submitted by Plaintiff in accordance with the ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.