4 unchanged sentences
In connection with certain of the below matters and other legal matters, we have accrued amounts that we believe are appropriate.
−Removed: There can be no assurance, however, that the above matters and other legal matters will not result in us having to make payments in excess of such accruals or that the above matters or other legal matters will not materially or adversely affect our business, financial position or results of operations.
+Added: There can be no assurance, however, that the above matters and other legal matters will not result in us having to make payments in excess of such accruals or that the above matters or other legal matters will not materially or adversely affect our business, financial position, results of operations, or cash flows.
+Added: Commercial Matters
+Added: We have been involved in various litigation matters and arbitrations with respect to commercial matters arising with clients, vendors and third-party sellers of businesses.
+Added: We have retained outside counsel to represent us in these matters and we are vigorously defending our interests.
Employment-Related Matters
We have also been involved in various litigation, including purported class or representative actions with respect to matters arising under the U.S.
−Removed: Fair Labor Standards Act, California’s Labor Code (the “Labor Code”) and California’s Labor Code Private Attorneys General Act (“PAGA”).
+Added: Fair Labor Standards Act, California Labor Code and Private Attorneys General Act (“PAGA”).
Many involve allegations for allegedly failing to pay wages and/or overtime, failing to provide meal and rest breaks and failing to pay reporting time pay, waiting time penalties and other penalties.
1 unchanged sentence
We filed a motion for summary judgment.
−Removed: The court granted our motion for summary judgment in March 2020, and the plaintiff filed an appeal of the court’s ruling in May 2020.
+Added: The court granted our motion for summary judgment in March 2020.
+Added: The plaintiff filed an appeal of the court’s ruling, and in December 2022, the Court of Appeals reversed the court’s grant of summary judgment and directed the matter back to the superior court for further proceedings.
We have retained outside counsel to represent us and intend to vigorously defend our interests in this matter.
Proceedings Relating to Take 5
−Removed: The following proceedings relate to the Take 5 Matter, which is discussed in greater detail in “
−Removed: PART I, Financial Information —Item 1.
−Removed: Financial Statements—Note 10.
−Removed: Commitments and Contingencies ”
−Removed: Risk Factors —
−Removed: Risks Related to the Company’s Business and Industry ”
−Removed: in this Quarterly Report.
−Removed: USAO and FBI Voluntary Disclosure and Investigation Related to Take 5
−Removed: In connection with the Take 5 Matter, we voluntarily disclosed to the United States Attorney’s Office and the Federal Bureau of Investigation certain misconduct occurring at Take 5.
−Removed: We intend to cooperate in this and any other governmental investigation that may arise in connection with the Take 5 Matter.
−Removed: At this time, we cannot predict the ultimate outcome of any investigation related to the Take 5 Matter and are unable to estimate the potential impact such an investigation may have on us.
−Removed: Arbitration Proceedings Related to Take 5
−Removed: In August 2019, as a result of the Take 5 Matter, we provided a written indemnification claim notice to the sellers of Take 5, or the Take 5 Sellers, seeking monetary damages (including interest, fees and costs) based on allegations of breach of the asset purchase agreement, or Take 5 APA, as well as fraud.
−Removed: In September 2019, the Take 5 Sellers initiated arbitration proceedings in the state of Delaware against us, alleging breach of the Take 5 APA as a result of our decision to terminate the operations of the Take 5 business and seeking monetary damages equal to all unpaid earn-out payments under the Take 5 APA (plus interest fees and costs).
−Removed: In 2020, the Take 5 Sellers amended their statement of claim to allege defamation, relating to statements we made to customers in connection with terminating the operations of the Take 5 business, and seeking monetary damages for the alleged injury to their reputation.
−Removed: We have filed our response to the Take 5 Sellers’
−Removed: claims and asserted indemnification, fraud and other claims against the Take 5 Sellers as counterclaims and cross-claims in the arbitration proceedings.
−Removed: In October 2022, the arbitrator made a final award in our favor.
+Added: In April 2018, we acquired the business of Take 5 Media Group (“Take 5”).
+Added: As a result of an investigation into that business in 2019 that identified certain misconduct, we terminated all operations of the Take 5 in July 2019, including the use of its associated trade names and the offering of its services to its clients and offered refunds to clients of collected revenues attributable to the period after our acquisition.
+Added: We refer to the foregoing as the Take 5 Matter.
+Added: We voluntarily disclosed to the United States Attorney’s Office and the Federal Bureau of Investigation certain misconduct occurring at Take 5.
+Added: We intend to cooperate in this and any other governmental investigations that may arise in connection with the Take 5 Matter.
+Added: In August 2019, we requested monetary indemnification from the sellers of Take 5 (including interest, fees and costs) based on allegations of breach of the asset purchase agreement, as well as fraud.
+Added: In October 2022, an arbitrator made a final award in our favor.
We are currently unable to estimate if or when we will be able to collect any amounts associated with this arbitration.
−Removed: Other Legal Matters Related to Take 5
−Removed: The Take 5 Matter may result in additional litigation against us, including lawsuits from clients, or governmental investigations, which may expose us to potential liability in excess of the amounts being offered by us as refunds to Take 5 clients.
−Removed: We are currently unable to determine the amount of any potential liability, costs or expenses (above the amounts already being offered as refunds) that may result from any lawsuits or investigations associated with the Take 5 Matter or determine whether any such issues will have any future material adverse effect on our financial position, liquidity or results of operations.
−Removed: Although we have insurance covering certain liabilities, we cannot assure that the insurance will be sufficient to cover any potential liability or expenses associated with the Take 5 Matter.
+Added: The Take 5 Matter may result in additional litigation against us, including lawsuits from clients, or governmental investigations, which may expose us to potential liability in excess of the amounts we offered by as refunds to Take 5 clients.
+Added: We are currently unable to determine the amount of any potential liability, costs or expenses (above the amounts previously offered as refunds) that may result from any lawsuits or investigations associated with the Take 5 Matter or determine whether any such issues will have any future material adverse effect on our financial position, liquidity, or results of operations.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.