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UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF FLORIDA
WEST PALM BEACH DIVISION
PARTNERS BIOMEDICAL SOLUTIONS, LLC,
a Florida limited liability company, and
MAC 15, LLC,
a Florida limited liability company,
Plaintiffs,
CASE NO. 19-cv-81316-RAR
v.
EUGENE SALTSMAN, individually,
DARCY SALTSMAN, individually,
ALFATWO HOLDINGS, LLC,
a Florida limited liability company,
EVAN SALTSMAN, individually,
STEVEN D. FRIEDMAN, individually,
REICHEL REALTY & INVESTMENTS, INC.,
a Florida corporation,
SEZ HOLDING CORP., a Florida corporation,
MATRIX INSTRUMENT SERVICES, INC.,
a New York corporation, and
BENJAMIN CHEVERE, individually,
Defendants.
___________________________________________
EUGENE SALTSMAN, EVAN SALTSMAN,
and ALPHA TWO HOLDINGS, LLC,
a Florida limited liability company,
Counter-plaintiffs,
v.
ROBERT BURKE, individually, LOUIS WELTMAN,
individually, PARTNERS BIOMEDICAL SOLUTIONS, LLC,
a Florida Limited Liability Company,
GULF COAST BIOMEDICAL, LLC.,
a Florida Limited Liability Company,
MAC 15, LLC, a Florida Limited Liability Company,
LOSOWE CAPITAL, INC., a Florida Corporation,
and PERKINS BIOMEDICAL SERVICES, LLC,
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a New Hampshire Limited Liability Company,
Counter-defendants.
__________________________________________________/
DEFENDANTS, EUGENE SALTSMAN, DARCY SALTSMAN, ALFATWO HOLDINGS,
LLC, EVAN SALTSMAN, BEN CHEVERE, AND MATRIX EQUIPMENT SYSTEMS,
INC.'S ANSWER AND AFFIRMATIVE DEFENSES TO PLAINTIFFS' COMPLAINT,
AND COUNTERCLAIMS BY EUGENE SALTSMAN, ALPHATWO HOLDINGS, LLC
AND EVAN SALTSMAN
Defendants, Eugene Saltsman ("Gene"), Darcy Saltsman ("Darcy"), Alfatwo Holdings,
LLC ("Alfatwo"), Evan Saltsman ("Evan"), Benjamin Chevere (“Chevere”), and Matrix
Equipment Systems, Inc. ("Matrix"), file their Answer and Affirmative Defenses to Plaintiffs'
Complaint. Gene, Alphatwo, and Evan file their counterclaims more fully described herein.
GENERAL ALLEGATIONS
Common to All Counts
Summary and Nature of the Action
1. Denied.
2. Denied.
3. Denied.
4. Admitted as to Gene having previously participated in a mediation with
Plaintiffs. Defendants1 deny the remainder of the allegations in paragraph 4 of the Complaint.
5. Admitted as to the Transaction Documents governing the dispute resolution
jurisdiction and venue for and amongst Mac 15,LLC (MAC 15") Partners Biomedical Services,
LLC ("Partners") and the Defendant signatories thereto. Defendants deny the remainder of the
allegations in paragraph 5 of the Complaint.
1 Given the method in which the Complaint is drafted, the use of the word Defendants in this Answer pertains
to all of Gene, Darcy, Alphatwo, Evan, Matrix and Chevere.
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6. Denied.
Jurisdiction, Venue, and the Parties
7. Denied, except admit that the Court has original jurisdiction as to The Defend
Trade Secrets Act of 2016.
8. Defendants admit that venue is proper in this Court because Gene, Darcy, and
Alphatwo reside and/or conduct business in this District. Defendants deny the remainder of the
allegations in Paragraph 8 of the Complaint.
9. Admitted as to Partners being a Florida limited liability company having its
principal place of business in West Palm Beach, Florida. Defendants deny the remainder of the
allegations in paragraph 9 of the Complaint.
10. Denied, except admit that Partners is a Florida limited liability company.
11. Admitted.
12. Admitted as to MAC 15 being a Florida limited liability company owned by
Robert Burke, M.D., and a Member and Manager of Partners and that Burke acted as Manager
on behalf of MAC 15 in connection with Partners' management and control. Defendants deny
the remainder of the allegations in paragraph 12 of the Complaint.
13. Denied, except admit that MAC 15 is a Manager of Partners, holds a 40.01%
membership interest in Partners and holds certain voting proxies.
14. Admitted as to Gene being sui juris and residing and conducting business at the
stated addresses in Palm Beach County; admitted that Gene, at all times, was the majority owner
of Alfatwo and further and state that Gene, at all times, was and is the sole owner of Alfatwo,
which is a party to the Operating Agreement; deny that the Operating Agreement "followed"
the SPA, and deny the remainder of the allegations in paragraph 14 of the Complaint.
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15. Admitted as to Darcy being sui juris and residing at the stated address in Palm
Beach County and as to Darcy being the wife of Gene; Defendants deny the remainder of the
allegations in paragraph 15 of the Complaint.
16. Admitted as to Alfatwo being a Florida limited liability company that has an
office in and conducts business from the stated address in Delray Beach, Florida; Composite
Exhibit J attached to Plaintiffs' Complaint speaks for itself; Defendants deny the remainder of
the allegations in paragraph 16 of Plaintiffs' Complaint.
17. Admitted as to Defendant SEZ Holding Corp. ("SEZ") being a Florida
corporation solely owned by Defendant Steven Friedman ("Friedman") and being a Member,
but not a Manager, of Partners, holding 15.00% of the Partners' voting membership units;
Defendants deny the remainder of the allegations in paragraph 17 of the Complaint.
18. Admitted as to Evan being a natural person residing at the stated address in
Beacon, New York, and being sui juris; Defendants deny the remainder of the allegations in
paragraph 18 of the Complaint.
19. Admitted as to Defendant Friedman being sui juris and residing at and
conducting business from the stated address in Palm Beach Gardens, Florida; Defendants deny
the remainder of the allegations in paragraph 19 of Plaintiffs' Complaint.
20. Denied, except Defendants do not have sufficient information as to whether
Friedman was ever employed by Reichel Realty and therefore deny same.
21. Admitted.
22. Admitted as to Defendant Matrix being a New York corporation that has the
stated address in Elsmford, New York. Defendants deny the remainder of the allegations in
paragraph 22 of Plaintiffs' Complaint.
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23. Denied, except Defendants admit that Chevere previously conducted business
on behalf of Progressive Medical Lab, LLC and appeared as a representative of that company.
24. Denied.
25. Admitted as to Defendant Gene having previously participated in a mediation
with Plaintiffs. Defendants deny the remainder of the allegations in paragraph 25 of Plaintiffs'
Complaint.
26. Admitted as to Gene, Evans and Friedman, these Defendants had
communications and conducted business with Plaintiffs at Plaintiffs' place of business in Palm
Beach County; Defendants deny the remainder of the allegations in paragraph 26 of Plaintiffs'
Complaint.
27. Admitted as to Defendants residing or conducting business in Palm Beach
County; Defendants deny the remainder of the allegations in paragraph 27 of Plaintiffs'
Complaint.
Underlying Factual Allegations
I. The Entities.
28. Admitted, except denied that the Entities were predominately in Florida.
29. Admitted.
II. The Offering.
30. Denied, except admitted that non-party Weltman formed non-party NABS for
the purpose of purchasing Gene’s interest in the Entities.
31. Denied.
32. Admitted that Friedman, with the assistance of Gene, prepared and distributed
the referenced Confidential Memorandum; Denied as to Darcy.
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33. To the extent Plaintiffs are referring or citing to a document, the document
speaks for itself. Defendants otherwise deny Paragraph 33 to the Complaint.
34. Admitted.
35. Defendants are without knowledge of the allegations in paragraph 35 of
Plaintiffs' Complaint.
36. Denied.
III. The Business Brokerage and Friedman's Self-Dealing.
A. Friedman and Reichel Realty Look for a Buyer.
37. Admitted.
38. Admitted as to Defendant Friedman presenting the opportunity to purchase the
Entities to Dr. Burke; Defendants are without knowledge as to the remainder of the allegations
in paragraph 38 of Plaintiffs' Complaint.
39. Denied.
40. Denied, except admitted that Reichel Realty and Burke entered into an
agreement and that Gene paid Reichel Realty a commission.
41. Denied.
42. Denied. The Defendants are without knowledge that Burke was referred to
Friedman by Reichel; admitted that Friedman acted as Reichel’s agent. The Defendants are
without knowledge and therefore deny the remaining allegations in paragraph 42 of Plaintiffs'
Complaint.
B. Misrepresentation of the Financials.
43. Denied. The Defendants are without knowledge of the allegations in paragraph
43 of Plaintiffs' Complaint.
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44. Admitted.
45. Denied.
46. Admitted.
47. Denied.
48. Denied. The Defendants are without knowledge of the formation of MAC 15.
49. Denied.
50. Denied.
51. Denied.
C. Friedman's Self-Dealing.
a. Friedman's Equity Grab.
52. Denied. The Defendants are without knowledge as Friedman expressing an
interest; the remaining allegations are admitted.
53. Admitted.
54. Admitted as to Dr. Burke forming Partners to assume NABS contractual rights
under the SPA and to consolidate the three Entities; Defendants deny and are without
knowledge of the remainder allegations in paragraph 54 of Plaintiffs' Complaint
55. Admitted as to Defendant Friedman forming Defendant SEZ on May 24, 2018;
Defendants are without knowledge of Friedman‘s purpose of forming the entity; admitted that
Gene formed Alphatwo; denied Gene formed Alphatwo with Evan; admitted Weltman used
Losowe for holding 25% of Partners.
56. Admitted as to the Transaction closing on October 19, 2018; Defendants are
without knowledge as to the remainder of the allegations in paragraph 56 of Plaintiffs'
Complaint.
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b. Friedman's Self-Dealing Dual Agency.
57. Denied.
58. Denied.
59. Denied, except admitted Friedman had an obligation not to violent any covenant
he may have made.
60. Denied.
61. Denied.
62. Denied.
IV. The "Pump and Dump" Promotion.
63. Denied as written.
64. Admitted.
65. Denied.
V. The Disclosures and Obligations of Defendants Under the Transaction Documents.
66. Denied, except admitted as to Defendant Gene entering into the SPA.
67. Denied.
68. The document speaks for itself.
A. The Scheme
69. Denied as written.
70. Denied.
71. Denied.
72. Denied.
73. Denied.
74. Denied.
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75. Denied.
76. Admitted as to Alfatwo's resignation from PBS membership on May 16, 2019,
and resignation as a Manager, without compensation, on June 4, 2019; Defendants deny the
remainder of the allegations in paragraph 76 of Plaintiffs' Complaint.
77. Admitted as to Friedman's offer to resign his PBS membership; Defendants deny
the remainder of the allegations in paragraph 77 of Plaintiffs' Complaint.
VI. Defendants Improperly Take, Distribute and Use Trade Secrets and Violate Non-
Competition Covenants.
78. Admitted, except denied that Alphatwo is owned 95% by Gene and 5% by Evan.
79. Admitted, except denied that Alphatwo had more than one member at any time.
80. The documents speak for themselves.
81. The documents speak for themselves.
82. Denied.
83. Admitted.
A. Non-Solicitation, Non-Competition and Non-Hiring (the "Restrictive
Covenants").
84. Admitted.
85. Denied.
86. Denied.
87. Admitted.
88. Denied.
89. Denied. The agreement speaks for itself.
90. Denied.
91. Denied.
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92. Denied.
93. Admitted.
94. The document speaks for itself.
95. Admitted.
96. The Operating Agreement speaks for itself.
97. To the extent Plaintiff is referring or citing to a document, the document speaks
for itself.
98. Denied.
B. Theft and Misappropriation of Trade Secrets.
99. Denied.
100. Denied.
101. Denied.
102. Denied.
103. Denied.
104. Denied.
105. Denied.
106. Denied.
107. Denied.
VII. Defendants' Past Scheme, Which Continues to this Day.
A. Defendants Cooked the Books.
a. Misrepresentation of Working Capital.
108. Denied. The document speaks for itself.
109. Denied. The document speaks for itself.
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110. Denied.
111. Denied.
112. Denied.
113. Defendants are without knowledge as to the allegations in paragraph 113 and
therefore deny same.
114. Defendants are without knowledge as to the allegations in paragraph 114 and
therefore deny same.
115. Denied.
116. Denied
117. Denied.
118. Denied.
119. Denied.
120. Denied.
121. Denied.
122. Denied.
123. Denied.
B. Gene Takes a Lot of Money.
124. Denied as to any fraudulent activity.
125. Denied.
126. Denied.
127. Denied.
128. Denied.
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129. Denied. Defendants are without knowledge as to what PBS attempted to file
with the State of New York.
130. Denied. Defendants are without knowledge as to what PBS learned from its tax
professionals.
131. Denied.
132. Denied.
133. Denied.
134. Denied.
135. Denied.
IX. Defendants' Breach of the Restrictive Covenants.
136. Admitted.
137. Admitted.
138. Denied.
139. Denied.
140. Denied, including all subparts.
A. The Kickback Scheme and Defendant Chevere.
141. Denied.
142. Denied.
143. Denied as to stated bad acts. Admitted as to the remainder of the allegations in
Paragraph 143 of Plaintiffs’ Complaint.
X. The Closing.
144. Denied.
145. Denied.
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146. Denied.
147. Denied.
XII. Other Bad Acts.
A. The Improper UCC-1
148. Admitted.
149. Denied, except admitted that PBS is managed by MAC 15 and Losowe.
150. Denied.
B. Diversion of PBS Sales of Consumables.
151. Denied.
152. Denied.
153. Denied.
154. Denied as stated.
155. Denied.
156. Denied.
C. Improper Distribution and Fraudulent Transfers.
157. Denied.
158. Denied.
159. Denied, except admitted that Friedman was terminated by Gulf Coast after not
being paid.
160. Denied.
161. Denied.
162. Denied.
163. Denied.
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164. Denied.
165. Denied.
166. Denied.
167. Denied.
168. Denied.
169. Denied.
170. Denied.
171. Denied.
D. Further Material Misrepresentations.
172. Denied.
E. Disparagement in the Industry.
173. Denied.
174. Denied.
COUNT I
Breach of Contract – Stock Purchase Agreement
(against Defendant Gene Saltsman)
175. The Defendants adopt and re-assert all previous responses.
176. Denied as stated.
177. Denied.
178. Denied.
179. Denied.
180. Admitted.
181. Denied.
182. Denied as stated.
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183. Denied.
184. Denied.
185. Denied.
186. Admitted.
187. Admitted.
COUNT II
Breach of Contract – PBS Operating Agreement
(against Defendants Gene Saltsman, Evan Saltsman,
Alfatwo Holdings, Inc., Steven Friedman and SEZ Holding Corp.)
188. The Defendants adopt and re-assert all previous responses.
189. Denied.
190. Denied.
191. Denied.
192. Denied.
193. Denied.
194. Denied.
195. Denied.
196. Denied.
197. Admitted.
198. Admitted.
COUNT III
Breach of Contract – Post-Organizations Agreement
(against Defendants Gene Saltsman, Evan Saltsman,
Alfatwo Holdings, Inc., Steven Friedman and SEZ Holding Corp.)
199. The Defendants adopt and re-assert all previous responses.
200. Denied.
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201. Denied.
202. Denied.
203. Denied.
204. Denied.
205. Denied.
206. Denied.
207. Denied.
208. Admitted.
COUNT IV
Breach of Co-Members' Statutory Duties of Loyalty – F.S. § 605.04091
(against Defendants Gene Saltsman, Evan Saltsman,
Alfatwo Holdings, Inc., Steven Friedman and SEZ Holding Corp.)
209. The Defendants adopt and re-assert all previous responses.
210. Denied.
211. Denied.
212. Denied.
213. Denied.
214. Denied.
215. Denied.
216. Denied.
217. Denied.
218. Denied.
219. Admitted.
220. Admitted.
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COUNT V
Fraud – in the Inducement
(Plaintiff MAC 15 against Defendants Gene Saltsman,
Evan Saltsman, Darcy Saltsman, Alfatwo Holdings, Inc., Reichel Realty,
Steven Friedman and SEZ Holding Corp.)
221. The Defendants adopt and re-assert all previous responses.
222. Denied.
223. Denied.
224. Denied.
225. Denied.
226. Denied.
227. Denied.
228. Denied.
229. Denied.
230. Denied.
231. Denied.
232. Denied.
COUNT VI
Fraud – in the Performance of the Stock Purchase Agreement
(against Defendant Gene Saltsman)
233. The Defendants adopt and re-assert all previous responses.
234. Denied as stated.
235. Denied.
236. Denied.
237. Denied.
238. Denied.
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239. Denied.
240. Denied.
241. Denied.
242. Denied.
243. Denied.
244. Denied.
245. Denied.
246. Denied.
247. Denied.
248. Denied.
249. Denied.
COUNT VII
Fraud – in the Performance of the PBS Operating Agreement
(against Defendants Gene Saltsman, Evan Saltsman, Darcy Saltsman, Alfatwo
Holdings, Inc., Steven Friedman and SEZ Holding Corp.)
250. The Defendants adopt and re-assert all previous responses.
251. Denied.
252. Denied.
253. Denied.
254. Denied.
255. Denied as stated.
256. Denied.
257. Denied.
258. Denied.
259. Denied.
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260. Denied.
261. Denied.
262. Denied.
263. Denied.
264. Denied as stated.
265. Denied
266. Denied
267. Denied
COUNT VIII
Tortious Interference with Customer Relations
(against Defendants Gene Saltsman, Evan Saltsman, Alfatwo Holdings, Inc.,
Steven Friedman, SEZ Holding Corp., Matrix and Chevere)
268. The Defendants adopt and re-assert all previous responses.
269. Denied.
270. Denied.
271. Denied.
272. Denied.
273. Denied.
274. Denied.
COUNT IX
Tortious Interference with Employee and Contractor Contractual Relations
(against Defendants Gene Saltsman, Evan Saltsman, Alfatwo Holdings, Inc., Steven
Friedman, SEZ Holding Corp. and Matrix)
275. The Defendants adopt and re-assert all previous responses.
276. Denied.
277. Denied.
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278. Denied.
279. Denied.
280. Denied.
281. Denied.
COUNT X
Conspiracy to Interfere with Contract, to Interfere with
Other Relations, and to Prevent Competition
(against Defendants Gene Saltsman, Evan Saltsman,
Steven Friedman, and Ben Chevere)
282. The Defendants adopt and re-assert all previous responses.
283. Denied.
284. Denied, except admit Chevere is associated with Advanced Dermatology.
285. Denied.
286. Admitted.
287. Denied.
288. Denied.
289. Denied.
290. Denied.
291. Denied.
292. Denied.
293. Denied.
294. Denied.
295. Denied.
296. Denied.
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COUNT XI
Violation of FDUTPA, F.S. § 501.201 et seq.
(against Defendants Gene Saltsman, Evan Saltsman, Alfatwo Holdings, Inc.,
Steven Friedman, SEZ Holding Corp., Matrix and Chevere)
297. The Defendants adopt and re-assert all previous responses.
298. Denied.
299. Denied.
300. Denied.
301. Denied.
302. Admitted.
COUNT XII
Violation of The Defend Trade Secrets Act – 18 U.S.C. § 1836 et seq.
(against Defendants Gene Saltsman, Evan Saltsman, Alfatwo Holdings, Inc.,
Steven Friedman, SEZ Holding Corp., Matrix, and Chevere)
303. The Defendants adopt and re-assert all previous responses.
304. Admitted.
305. Denied.
306. Admitted, except denied as to Evan.
307. Denied.
308. Denied.
309. Denied.
310. Denied.
311. Denied.
312. Denied.
313. Denied.
314. Denied.
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315. Denied
COUNT XIII
Violation of the Florida Uniform Secrets Act – F. S. §§ 688.001 et seq.
(against Defendants Gene Saltsman, Evan Saltsman, Alfatwo Holdings, Inc.,
Steven Friedman, SEZ Holding Corp., Matrix, and Chevere)
316. The Defendants adopt and re-assert all previous responses.
317. Admitted.
318. Denied.
319. Admitted, except denied as to Evan.
320. Denied.
321. Denied.
322. Denied.
323. Denied.
324. Denied.
325. Denied.
326. Denied.
327. Denied.
328. Denied.
329. Denied.
330. Denied.
COUNT XIV
Unjust Enrichment and Disgorgement
(against Defendant Gene Saltsman, Evan Saltsman, Alfatwo Holdings, Inc.,
Steven Friedman, SEZ Holding Corp., Matrix, and Chevere)
331. The Defendants adopt and re-assert all previous responses.
332. Denied.
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333. Denied.
334. Denied.
335. Denied.
336. Denied.
337. Denied.
AFFIRMATIVE DEFENSES
AND NOW in further answering, Gene, Darcy, Alfatwo, Evan, Chevere, and Matrix
affirmatively state:
FIRST AFFIRMATIVE DEFENSE
MAC 15 does not have standing to assert a direct action in Count I.
SECOND AFFIRMATIVE DEFENSE
Gene is no longer bound any restrictive covenant or non-competition provision pursuant to
Section 6.5 of the SPA since Partners previously breached the SPA and related documents .
THIRD AFFIRMATIVE DEFENSE
Count I fails since Plaintiffs failed to take reasonable measures to restrict the use of the
purported trade secrets and confidential data.
FOURTH AFFIRMATIVE DEFENSE
Count I fails since the Plaintiffs breached the SPA first by, among other things, breaching
documents, including but not limited to the Pledge and Security Agreement, the Operating
Agreement and the Post Or. Agreement, and therefore the Note, and addition to failing to pay the
Purchase Price at that term is defined in the document.
FIFTH AFFIRMATIVE DEFENSE
Count II fails against Evan since he was not a party to the Operating Agreement.
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SIXTH AFFIRMATIVE DEFENSE
MAC 15 does not have standing to assert a direct action in Count II.
SEVENTH AFFIRMATIVE DEFENSE
Count II fails since Plaintiffs failed to take reasonable measures to restrict the use of the
purported trade secrets and confidential data.
EIGHTH AFFIRMATIVE DEFENSE
Count II fails as Partners and MAC 15 breached the Operating Agreement, by among other
things, failing to seek or obtain financing pursuant to Section 3.5 of the Operating Agreement.
NINTH AFFIRMATIVE DEFENSE
Count III fails against Evan as he is not a party to the agreement.
TENTH AFFIRMATIVE DEFENSE
Count III fails since Plaintiffs failed to take reasonably measures to restrict the Defendants'
use of the purported trade secrets and confidential data.
ELEVENTH AFFIRMATIVE DEFENSE
MAC 15 does not have standing to assert a direct action against in Count III.
TWELFTH AFFIRMATIVE DEFENSE
Count III fails since Partners and MAC 15, through Burke, breached Section 1.6 of the
agreement by failing and refusing to provide Gene with a security interest in Gulf Coast
Biomedical, LLC.
THIRTEENTH AFFIRMATIVE DEFENSE
Count IV fails against Evan since he is not a party to the Partners' Operating Agreement.
FOURTEENTH AFFIRMATIVE DEFENSE
Counts I, II, and III fails against Gene based on fraud. Gene was fraudulently induced to
enter into the SPA, the Note, the Pledge and Security Agreement, Partners' Operating Agreement,
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and Post Org. Agreement, to purportedly sell his interests in the Gene Entities, to provide his
experienced, valuable services, talents and energies to the financial and other advancement and
reward to Plaintiffs, without paying Gene, by cheating Gene out of his rightful ownership and
security interest in New Gulf Coast and by purloining and converting to their own use Gene's
business contacts and relationships. Gene was promised that his security interest would be
protected; Gene was promised that his $3,000,000.00 "Purchase Price" would be paid; and
Weltman, a managing member of Partners intentionally and materially omitted telling Gene that
his guaranty in the Partners' Operating Agreement was worthless as a result of his filing of a
Petition for Relief under Chapter 11 of Title 11 of the United States Code in 2014 resulting in the
confirmation of a Plan of Reorganization in 2016.
FIFTEENTH AFFIRMATIVE DEFENSE
Counts I, II, III, and IV fail based on the doctrine of unclean hands. MAC 15 and Partners
have breached the SPA, the Operating Agreement, the Pledge and Security Agreement, the Note,
the Post Org. Agreement by, among other things, (i) failing to pay Gene under the Promissory
Note, (ii) breaching the Security Agreement, (iii) destroying Gene's security interest in Gulf Coast,
Inc. by converting the company in Gulf Coast Biomedical, LLC and failing to provide Gene with
a security interest in the new entity, and (iv) taking Gene's companies without paying for them and
destroying them.
SIXTEENTH AFFIRMATIVE DEFENSE
Counts VI and VII fail based on Florida's economic loss rule.
SEVENTENTH AFFIRMATIVE DEFENSE
Counts VIII, IX, and X fail against Evan, Chevere, and Matrix since these counts are based
upon alleged breaches of agreements to which none of them were parties.
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EIGHTEENTH AFFIRMATIVE DEFENSE
Counts VIII, IX, and X fail against Gene since the Plaintiffs breached the SPA, the Pledge
and Security Agreement, the Post. Org. Agreement, the Operating Agreement, and the Note.
NINETEENTH AFFIRMATIVE DEFENSE
MAC 15 does not have standing to assert a direct action in Counts VIII, IX, and X.
TWENTIETH AFFIRMATIVE DEFENSE
Counts VIII, IX, and X fail as the employees and independent contractors were terminated
or quit due to Partners' mismanagement or lack of management, and any contact was unsolicited.
Further, any customers ceased doing business with Partners, to the extent they conducted business
with Partners at all, based on mismanagement or lack of management. No Defendants caused or
induce any employee, independent contractor or customer to sever their relationship with Partners.
TWENTY-FIRST AFFIRMATIVE DEFENSE
Counts VIII, IX, and X fail as the Defendants' actions were justified to safeguard their own
contractual interests.
TWENTY-SECOND AFFIRMATIVE DEFENSE
Count XI fails to a state a claim upon which relief may be granted. Count X is a hodgepodge
of elements of different causes of action under the guise of a FDUPTA claim. Plaintiffs combine
a breach of contract claim and a tortious interference claim, but fail to plead the elements of a
FDUPTA claim.
TWENTY-THIRD AFFIRMATIVE DEFENSE
MAC 15 does not have standing to assert a direct action in Count XI.
TWENTY-FOURTH AFFIRMATIVE DEFENSE
Count XII and XIII fail since Plaintiffs failed to take reasonable measures to restrict the
use of the purported trade secrets and confidential data.
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TWENTY-FIFTH AFFIRMATIVE DEFENSE
MAC 15 does not have standing to assert a direct action in Counts XII and Count XIII.
Rather, any claim must be brought derivatively on behalf of Partners.
TWENTY-SIXTH AFFIRMATIVE DEFENSE
Counts XII and XIII fail against Evan, Chevere, and Matrix since they were not parties to
the Partners' Operating Agreement.
TWENTY-SEVENTH AFFIRMATIVE DEFENSE
Gene was relieved of any restrictive covenant or non-competition provision pursuant to
Section 6.5 of the SPA since Plaintiffs failed to pay Gene $3,000,000.00 due to him under the
agreement, failed to provide with a security interest in stock of the newly formed Gulf Coast
Biomedical, LLC entity, failed to obtain financing under the Operating Agreement, transferred or
caused the transfer of Gulf Coast Biomedical, LLC's assets, continually defaulted under Gulf Coast
Biomedical, Inc.'s Line of Credit with Chase Bank, failed to advise Chase Bank of the conversion
of Gulf Coast Biomedical, Inc. to Biomedical, LLC and its consequent effect upon both Chase's
security interest in Gulf Coast Biomedical, Inc.'s assets and its effect upon Gene's personal
guarantee to Chase Bank. Counts XII and XIII fail as a matter of law.
TWENTY-EIGHTH AFFIRMATIVE DEFENSE
Counts XII and XIII fail as a matter of law since Plaintiffs breached every agreement with
Gene and Alphatwo. Plaintiffs failed to pay Gene $3,000,000.00 due to him under the agreements,
failed to provide with a security interest in stock of the newly formed Gulf Coast Biomedical, LLC
entity, failed to obtain financing under the Operating Agreement, transferred or caused the transfer
of Gulf Coast Biomedical, LLC's assets, continually defaulted under Gulf Coast Biomedical , Inc.'s
Line of Credit with Chase Bank, failed to advise Chase Bank of the conversion of Gulf Coast
Biomedical, Inc. to Biomedical, LLC and its consequent effect upon both Chase's security interest
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in Gulf Coast Biomedical, Inc.'s assets and its effect upon Gene's personal guarantee to Chase
Bank. .
TWENTY-NINTH AFFIRMATIVE DEFENSE
Count XIV fails as to Evan, Chevere, and Matrix, since none of them received $750,000.00
from either Plaintiff.
THIRTIETH AFFIRMATIVE DEFENSE
Count XIV fails based on MAC 15's/and or Partners' breaches of the Stock Purchase
Agreement (as assigned), the Pledge and Security Agreement, The Note, The Operating
Agreement and the Post Or. Agreement, in addition to statutory violations.
THIRTY-FIRST AFFIRMATIVE DEFENSE
MAC 15 does not have standing to assert a direct action in Count XIV.
THIRTY-SECOND AFFIRMATIVE DEFENSE
Plaintiffs' claims barred by the doctrine of unclean hands. Plaintiffs participated in an effort
to withhold payment to Evan Saltsman notwithstanding services he performed. Eugene Saltsman
was deprived of the purchase price for his companies, and was stripped of his security interest for
his companies. Alphatwo, likewise, failed to receive the benefit of its bargain on the agreements
based on Plaintiffs breaching every agreement to which Alpha Two is a party.
THIRTY-THIRD AFFIRMATIVE DEFENSE
Plaintiffs have failed to properly effectuate service of process against Chevere.
THIRTY-FOURTH AFFIRMATIVE DEFENSE
Partners does not have standing to bring any of the counts in the Complaint, other than the
counts based upon alleged breaches of the Stock Purchase as assigned and the Operating
Agreement.
JURY DEMAND
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Plaintiffs' demand for a jury trial should be stricken based, in part, on waivers identified in
the SPA, Partners' Operating Agreement, and Post Org. Agreement.
COUNTERCLAIMS
Counter-plaintiffs, EUGENE SALTSMAN ("Gene"), EVAN SALTSMAN ("Evan"), and
ALPHATWO HOLDINGS, LLC ("ALPHATWO"), sue Counter-defendants, PARTNERS
BIOMEDICAL SOLUTIONS, LLC ("Partners" or the "Company") and MAC 15, LLC, ("MAC
15") and defendants, ROBERT BURKE ("Burke"), LOUIS WELTMAN ("Weltman"), GULF
COAST BIOMEDICAL, LLC ("Gulf Coast, LLC" or "New Gulf Coast") as successor in interest
to GULF COAST BIOMEDICAL, INC. ("Gulf Coast, Inc." or "Old Gulf Coast"), LOSOWE
CAPITAL, INC. ("Losowe"), and PERKINS BIOMEDICAL SERVICES, LLC ("Perkins") and
allege:
PARTIES
1. Gene is an individual who resides in Palm Beach County, Florida.
2. Evan is an individual who resides in Dutchess County, New York.
3. Alfatwo is a Florida Limited Liability Company with its principal place of business
in Palm Beach County, Florida. Gene is a member of Alphatwo and a resident of Palm Beach
County, Florida.
4. At all times relevant to this case, Gene owned 100% of Alfatwo, presently owns
100% of Alfatwo and controls Alfatwo.
5. Burke is an individual who resides in Palm Beach County, Florida.
6. Weltman is an individual who resides in Palm Beach County, Florida.
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7. Partners is a Florida limited liability company with its principal place of business
in Palm Beach County, Florida. MAC 15, Losowe and SEZ are Members of Partners and residents
of Palm Beach County, Florida.
8. Burke and Weltman are the remaining Managers of Partners
9. Gulf Coast, LLC is a Florida limited liability company with its principal place of
business in Palm Beach County, Florida. Weltman is a Member and a resident of Palm Beach
County, Florida.
10. Perkins is a New Hampshire limited liability company with its principal place of
business in Merrimack County, New Hampshire. Upon information and belief, Shane Perkins is a
member of Perkins and a resident of Merrimack County, New Hampshire.
11. MAC 15 is a Florida limited liability company with its principal place in Palm
Beach County. At all times relevant to this case, MAC 15 was and presently is owned and
controlled by Burke. Burke is a resident of Palm Beach County, Florida.
12. Losowe is a Florida corporation with its principal place of business in Palm Beach
County, Florida. At all times relevant to this case, Losowe was and presently is owned and
controlled by Weltman.
JURISDICTION AND VENUE
13. This Court has supplemental jurisdiction over the counterclaims against MAC 15
and Partners pursuant to 28 U.S.C. §1367(a) and Federal Rule of Civil Procedure 13(a). This
Court has supplemental jurisdiction over the counterclaims against Burke, Weltman, Gulf Coast,
LLC, Losowe, and Perkins pursuant to Federal Rule of Civil Procedure 13(h), 20(a)(2)(A) and (B)
on the basis that the right to relief against them is asserted jointly, severally or in the alternative
with respect to or arising out of the same transactions, occurrences, series of transactions and series
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of occurrences set forth above and below and any question of law or fact common to all
counterclaim defendants will arise in this action.
14. Venue is proper in Palm Beach County, Florida for the following reasons: (i) Burke
and Weltman are residents of Palm Beach County, Florida,(ii) Gulf Coast, LLC and Partners'
principal office is or was last located in Palm Beach County Florida, and Partners presently
conducts business in Palm Beach County Florida, (iii) Perkins entered into an agreement with one
or more of Burke, Weltman, Gulf Coast, LLC, or Partners in order to obtain certain of Gulf Coast,
LLC's assets and service certain accounts, and is a party to a continuing contract and business
arrangement with Gulf Coast, LLC and/or Partners; (iv) all causes of action asserted in this
Complaint arose from actions or events occurring in Palm Beach County Florida.
15. This Court has personal jurisdiction over Burke and Weltman as they are residents
of Florida. This Court has personal jurisdiction over Partners, Gulf Coast, LLC MAC 15, and
Losowe as they are Florida entities operating, present, and/or doing business in Palm Beach
County, Florida, and some or all of these Defendants' breaches and tortious activity occurred in
Palm Beach County.
16. This Court has long-arm jurisdiction over Perkins pursuant to Florida Statutes,
§48.193(1)(b) by committing a tortious act in the state, as well as entering into an agreement with
Gulf Coast, LLC which required performance in Florida by remitting funds to or for the benefit of
Gulf Coast, LLC.
17. All conditions precedent to bringing this action have been satisfied, waived or
excused.
18. Counter-plaintiffs have engaged the services of the undersigned counsel and are
obligated to pay them a reasonable fee for their services.
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FACTUAL BACKGROUND
I. The Acquisition Of Gene Entities
19. On August 24, 2014, Gene formed and organized Gulf Coast, Inc. On December
14, 2006 and November 11, 2017, respectively, Gene formed Gulf Coast Instrument Company, a
New York limited liability company ("Instrument") and Advanced Laser Service, Inc., a New York
corporation ("Laser") (Gulf Coast, Inc., Instrument, and Laser are collectively referred to as the
"Gene Entities").
20. Prior to October of 2018, Gene owned 100% of the issued and outstanding stock or
units, as appropriate, of the Gene Entities.
21. From January of 2016 through October 22, 2018, Gulf Coast, Inc. had annual
revenues of approximately $2,200,000.00.
22. On March 30, 2017, Gene executed a Standard Exclusive Right of Sale Listing
Agreement with Reichel Realty & Investments, Inc. for the purpose of selling one or more of the
Gene Entities.
23. On October 18, 2017, Gene executed a First Amendment to Standard "Exclusive
Right of Sale" Listing Agreement with Reichel Realty & Investments, Inc. A copy of this
agreement is attached as Exhibit "1".
24. On June 22, 2017, Steven Friedman ("Friedman"), an independent contractor
affiliated with Reichel Realty & Investments, Inc., contacted Burke about the Gene Entities.
25. Commencing in July of 2017, Burke engaged in due diligence. Burke, along with
his agents, including a financial consultant and a certified public accountant, researched and
analyzed Gulf Coast, Inc.'s books and records, including but not limited to profit and loss
statements, corporate tax returns, balance sheets, contracts , accounts receivable ledgers and bank
statements.
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26. In November of 2017, Gene advised Burke that he was no longer interested in
engaging in further discussions with him due to Burke's lack of progress in coming to an
arrangement to purchase the Gene Entities.
27. In May of 2018, Friedman introduced Gene and Burke to Weltman and re-initiated
communications about an acquisition of the Gene Entities.
II. The Initial Stock Purchase Agreement
28. On June 7, 2018,Weltman, through Losowe, formed North American Biomedical
Services, LLC ("NABS"), ostensibly for the purchase of acquiring Gene's interest in the Gene
Entities.
29. NABS' original members were Weltman and SEZ Holding Corp., a Florida
corporation owned by Friedman.
30. On or about June 11, 2018 Gene and NABS entered into a Stock Purchase
Agreement, a true copy of which is attached as Exhibit "2", which provided that NABS would
purchase Gene's interest in the Gene Entities for the sum of $3,000,000.00 and receipt of a 19.99%
interest in NABS. Under the Stock Purchase Agreement, Gene would receive $500,000.00 at
closing, with the balance of the cash portion of the purchase price-- $2,500,000.00-- to be paid
pursuant to the terms of a Secured Convertible Promissory Note (the "Note") . A copy of the Note
is attached as Exhibit "3".
31. On July 12, 2018, Weltman wrote an email to Burke, copying Friedman and
William Reichel, confirming Burke's …"interest and readiness to proceed on the purchase of Gulf
Coast." A copy of this email is attached as Exhibit "4".
32. On August 16, 2018, Burke formed Partners as a Florida Limited Liability
Company.
III. Gene Is Granted Secured Creditor Status
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33. On August 17, 2018, NABS and Gene entered into a Pledge and Security
Agreement, granting Gene a pledge of and security interest in all of the shares/membership
interests of the Gene Entities, which were identified by three separate certificates. The
stock/membership interests of the Gene Entities, which in turn were to be combined into a wholly
owned subsidiary of Partners, were to serve as collateral for payment of Partners' obligations under
the Note. The agreement was executed by Partners by MAC 15 (by and through its manager,
Burke) and Losowe (by and through its President, Weltman). The Note was Exhibit A to the
agreement. A copy of the Pledge and Security agreement is attached as Exhibit "5".
34. The Pledge and Security Agreement provides in part:
2. Pursuant to the documents attached hereto as Composite
Exhibit "B," the Company hereby grants and pledges to Saltsman a
security interest in and to all of the Shares, as evidenced by
Biomedical certificate number 1, Instrument certificate number 1
(100 units) and Advanced certificate number 1 (100) shares….
* * *
3.2 The Company shall defend Saltsman's right, title, lien and
security interest in and to the Pledged Securities against the claims
and demands of any and all persons and entities.
* * *
6. If The Company shall default under the terms and conditions
of this Agreement or the Promissory Note, such default shall
constitute a default under this Agreement, and … (ii) Saltsman shall
have, in additional to all other rights and remedies including those
of a secured party under the Uniform Commercial Code of the State
of Florida, the right at any time and from time to time to acquire for
his own account, sell and deliver, or other take any action with
respect to the Pledged Securities in any manner and at any time
whatsoever.
* * *
8. Until such time as all amounts due under the Promissory
Note are paid in full, the Company, shall not, without the prior
written consent of Saltsman: (i) transfer or attempt to transfer the
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Pledged Securities, (ii) transfer or cause the transfer of any assets of
Biomedical, Instrument or Advanced, ….
9. A "default" or "event of default" under this Agreement shall
be deemed to have occurred up any of the following: (i) and "Event
of Default" under the Note, (ii) any representation, covenant or
warranty of the Company made herein shall be or become false in
any material respect; . . . (vii) or take any action for the purpose of
effecting any of the foregoing.
IV. Gene Enters Into An Employment Agreement With Gulf Coast, Inc.
35. On August 17, 2018, Gene and Gulf Coast, Inc. entered into an Employment
Agreement (the "Gene Employment Agreement"), whereby Gene became employed by Gulf
Coast, Inc. as an executive for a five year term. A copy of the "Employment Agreement" is
attached as Exhibit "6".
36. On October 19, 2018, Gene and Gulf Coast, Inc. entered into an "Amendment To
Employment Agreement." This Amendment changed the term of Gene's full time employment
from five years to 120 days, and provided that Gene would then work for Gulf Coast, Inc. on a
daily basis only as requested by Gulf Coast, Inc. and agreed to by Gene. A copy of the
"Amendment to Employment Agreement" is attached as Exhibit "7".
V. Partners Executes The Note
37. On October 19, 2018, the Note, signed by Burke and Weltman in their capacity as
Managers of Partners, was executed. See Exhibit "3".
The Note provides in part:
1. Principal. Partners [] for value received, hereby promises to
pay to the order of [Gene], the principal amount of Two Million Five
Hundred Thousand Dollars ($2,500,000), together with interest as
set forth below.
2. Interest: Payment Schedule and Maturity….Commencing on
the first (1st) anniversary of the Execution Date and continuing
annual thereafter, a principal payment of $500,000 together with all
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accrued interest, unpaid interest shall be due and payable to the
Holder.
* * *
5. Covenants. The Company covenants and agrees that…
(a) This Note is secured by a Pledge and Security Agreement
made by the Company in favor of the Holder of even date herewith
(b) This Note shall rank senior to any other debt incurred by the
Company and the Company shall at all times until this Note is paid
in full inform in writing any subsequent lender of its subordinate
position. For the avoidance of doubt, the Company shall enter into a
subordination agreement with any other lender to ensure that the
provisions of this Section 5(b) are not breached.
(c) The Company shall not take any action or become subject to
(including, without limitation, by way of amendment to or
modification of), any agreement or instrument which by its terms
would (under any circumstances) restrict the Company's right or
ability to perform the provisions of this Note or the Security
Agreement.
(d) The Company shall not amend its Articles of Organization
or Operating Agreement in any manner that adversely affects the
rights and obligations associated with this Note or the Security
Agreement.
* * *
7.1 Events of Default. An "Event of Default" shall occur
hereunder if:
(a) the Company shall default in the payment of any interest or
principal of this Note,…
(b) the Company shall default in the due observance or
performance of any covenant, representation, warranty, condition or
agreement on the part of the Company to be observed to be
performed pursuant to this Note or the Security Agreement,…
(e) The Company's board of managers consents to, or otherwise
approves the transfer of all or substantially all of the Company's
assets or the cessation of substantially all of the Company's
operations or the winding-up of the Company's affairs.
* * *
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8. No Dilution or Impairment. Except in the manner provided
in the last sentence of Section 8(b) of the Security Agreement, the
Company will not, by amendment of its Articles of Organization,
Operating Agreement or other governing documents, each as
amended, or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any
other voluntary action, avoid or seek to avoid the observance or
performance of any of the terms of this Note, but will at all times in
good faith assist in the carrying out of all such terms and in the
taking of all such action as be necessary or appropriate in order to
protect the rights of the Holder against dilution or other impairment.
VI. The Partners' Operating Agreement
38. On or about October 19, 2018, the Members of Partners executed an Operating
Agreement which provided, among other things, that its Members were MAC 15 (40.01% interest),
Losowe (25% interest), Alfatwo (19.99% interest) and Sez Holdings, Inc. (15% interest). Burke,
Weltman, and Friedman also signed the Operating Agreement in their individual capacities, in
order to confirm their agreement to personally guarantee certain obligations in connection with
financing that Partners was required to obtain pursuant to the Operating Agreement. A copy of the
Operating Agreement is attached as Exhibit "8".
Section 3.5 of the Operating Agreement provides, in pertinent part:
Financing. The Members acknowledge and agree that in
connection with the Company's business, the Company shall obtain
financing as may be required…Losowe, MAC15, and Friedman
(and/or their respective members and principals) shall be required to
provide such personal guaranties and credit enhancements as the
lender reasonably requires…The Members acknowledge that as of
the Effective Date, the Company is indebted to Saltsman pursuant
to a Secured Convertible Promissory Note dated as of the Effective
Date in the original principal amount of $2,500,000 (the "Saltsman"
Note"), which Saltsman Note shall at all times remain senior in
priority to all other debts of the Company, including the repayment
and priority of the collateral securing the repayment of the amounts
owed pursuant to the Saltsman Note (emphasis supplied).
39. Partners is a manager-managed Limited Liability Company.
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40. Neither Partners nor Weltman, Losowe, Burke, or MAC15 sought financing as
required by Section 3.5 of the Operating Agreement.
41. The Operating Agreement provides that initially the Managers of the Company
would be appointed by MAC 15, Losowe and Alfatwo. MAC 15 appointed Burke as a Manager,
Losowe appointed Weltman as a Manager, and Alfatwo appointed Gene as a Manager.
42. The Operating Agreement further provides that a majority of the Managers have
the ability to control both the day-to-day affairs of the Company and make what is defined as
"Major Decisions" of the Company (see Operating Agreement at ¶¶ 5.1, which addresses day-to-
day operations and 5.2, which addresses "Major Decisions," which require a "Required Vote, "
which is defined in ¶1.2(x) of the Operating Agreement as the "affirmative vote of Members who
hold a majority of units then outstanding").
43. MAC 15 and Losowe, through their designated and appointed managers, Burke and
Weltman, controlled all of Partners' operations, based on their ownership interest in Partners.
Conversely, neither Gene nor any other Member had any control over any of Partners' operations,
but for the exception in Section 5.3, the terms of which are not relevant to the allegations or counts
in this pleading.
VII. NABS Assigns its Interests and Obligations To Partners: Gene and Partners Execute
An Amended Stock Purchase Agreement
44. NABS and Partners entered into an agreement wherein in NABS assigned its rights
and obligations under the Stock Purchase agreement to Partners. A copy of this agreement is
attached as Exhibit "2".
45. On October 19, 2018, Gene and Partners entered into an Amended Stock Purchase
Agreement. A copy of the Amended Stock Purchase Agreement is attached as Exhibit "9". A
pertinent provision of this Agreement provides:
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2. All uses of the terms NABS in the [Stock Purchase]
Agreement are hereby amended to be [Partners,] including without
limitation NABS shall read [Partners]…The parties agree that such
changes reflect the assignment of the Agreement and all of the rights
and obligations of Buyer under the Agreement by N[ABS] to
[Partners].
VIII. Partners' Amended And Restated Post Organization Agreement For Investment And
Operation Of A Business
46. On October 19, 2018, an agreement entitled "Amended and Restated Post
Organization Agreement for Investment and Operation of a Business" was entered into among
Gene, Alfatwo, MAC 15 (which in the agreement is defined as "Burke" or "the Investor"), SEZ
and Losowe (defined as Weltman). The Agreement is referred to herein as the "Post Org.
Agreement". A copy of the Post Org. Agreement is attached as Exhibit "10".
47. The Post Org. Agreement defines the Stock Purchase Agreement, Amended Stock
Purchase Agreement, the Note and certain other documents entered into in connection with the
Stock Purchase Agreement, including but not limited to, the Pledge and Security agreement, as the
"Transaction Documents." The Post Org. Agreement provides that NABS assigned and Partners
assumed all rights and obligations in the "Transaction Documents."
48. Section 1.6 of the Post Org. Agreement provides that the Gene Entities shall be
converted to Limited Liability Companies and merged into Gulf Coast, LLC.
Section 1.6 of the Post Org. Agreement provides that:
On such conversion and merger, Partners and Saltsman shall amend
the Saltsman Pledge to reflect the conversion and merger and
Saltsman may file updated financing statements to reflect the then
obligors and collateral with respect to the Saltsman Pledge.
49. The "Saltsman Pledge" is defined in the Post Org. Agreement as the pledge of stock
and membership interests in the Gene Entities.
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50. Gulf Coast, LLC was formed as a Florida Limited Liability Company on or about
December 27, 2018 by virtue of filing Articles of Conversion ("Articles"). The Articles were
signed by Weltman on behalf of the newly converted entity and Burke on behalf of Gulf Coast,
Inc. The address of Gulf Coast, LLC is Weltman's residence in Boynton Beach, Florida. A copy
of the Articles of Conversion is attached as Exhibit "11”.
IX. Weltman, Burke, Their Companies, Partners and New Gulf Coast Breach The Post
Org. Agreement
51. Neither Partners nor Gulf Coast, LLC provided Gene with a security interest in Gulf
Coast, LLC's membership interests and therefore, any of its assets.
52. On August 12, 2019, Weltman filed a document with the Florida Department of
Corporations entitled, "Articles of Amendment to Articles of Organization of Gulf Coast
Biomedical, LLC." Weltman removed Gene as a Manager and Secretary of the company.
Weltman also removed Frank West as a Manager, removed Friedman as CFO, and removed Burke
as Chairman. The Amendment is attached as Exhibit "12".
53. Losowe, through Weltman, and Burke, through MAC 15, are the only Managers of
Gulf Coast, LLC.
54. Gulf Coast, Inc. has a checking account ("Gulf Coast Account") and a line of credit
with Chase Bank ("Gulf Coast Line"). The Gulf Coast Account and the Gulf Coast Line were
created before the Stock Purchase Agreement between Gene and NABS was executed.
55. The Gulf Coast Line was secured by a blanket lien against all of Gulf Coast, Inc.'s
assets, including, but not limited to, cash, accounts, accounts receivable, and equipment.
56. The outstanding amount due under this line of credit is approximately $140,000.00.
57. Gene personally guaranteed payment to Chase under the Line of Credit.
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58. Upon information and belief, Burke has exclusive control over the Gulf Coast
Account.
59. Burke and Weltman have taken substantial funds from the Gulf Coast Account and
used these company funds for their own use and benefit.
60. Burke and Weltman have taken substantial funds from the Gulf Coast Account and
have commingled them with funds in the accounts of Partners, Gulf Coast, Inc. and Gulf Coast,
LLC by moving money between the companies.
61. Weltman and Burke have caused Gulf Coast, LLC to repeatedly miss payments due
under the Chase Line of Credit.
62. Gulf Coast, LLC currently is in default on the Gulf Coast Line.
63. Upon information and belief, Burke has exclusive access to and control over
Partners' bank account and the use of its corporate credit card.
64. Upon information and belief, Burke has authorized charges against Partners' credit
card for the benefit of MAC, himself and Weltman.
65. Such charges were incurred with actual knowledge that Chase Bank had a lien
against Gulf Coast, Inc.'s assets, that Gene was to have a security interest in Gulf Coast, LLC's
assets, that Gene was the sole personal guarantor under the Gulf Coast Line and that Gene was a
creditor of Partners.
X. Post-Closing Business Operations
66. At the time of the execution of the documents dated October 19, 2019 (sometimes
referred to as the "Closing Date") or shortly thereafter, Gulf Coast, Inc. rented space at Vista
Parkway in West Palm Beach
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67. On or after the Closing Date, five people who had been affiliated with Gene and
Gulf Coast, Inc., Evan Saltsman, Mike Domingo, David Woods, Michael Loesel and Mike Field,
transitioned to work for Gulf Coast, Inc. under its new management.
68. By February of 2019, all five of these individuals were either terminated or quit
following poor treatment and non-payment of their compensation.
69. Approximately four months after the Closing, Gene was advised by Weltman that
his services for were no longer needed or wanted.
70. Following the Closing Date, Weltman and Burke hired new employees for Gulf
Coast and/or Partners, including, but not limited to, Robin Dean, Frank West, Michelle Whiteman,
Jared Horowitz and Israel Dominguez (collectively the "New Employees").
71. None of the New Employees are presently employed by Old Gulf Coast, New Gulf
Coast or Partners or affiliated with them in any way.
72. Friedman abandoned his business broker commission of $150,000.00 in order to
become CFO of Gulf Coast, Inc. and then Gulf Coast, LLC and own 15% of Partners. He was fired
and has an outstanding claim for services rendered against Gulf Coast, Inc. and/or Gulf Coast,
LLC for which he was not paid.
73. Through Weltman and Burke's gross mismanagement, New Gulf Coast was unable
to service its customers. New Gulf Coast's customers— who were Old Gulf Coast's customers,
trusted and valued Gene and the service his companies and their technicians provided.
74. On February 13, 2019, Friedman advised Burke that there was no leadership in New
Gulf Coast, only a dictator (meaning Weltman). Friedman also advised Burke that the collection
process on accounts receivable had changed seven times since October 19, 2018. A copy of an
email to this effect is attached as Exhibit "13".
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75. On or about July 1, 2019, New Gulf Coast entered into a business transaction with
Perkins. Upon information and belief, the agreement provided that Perkins would service New
Gulf Coast accounts in exchange for remitting a portion of the funds collected to New Gulf Coast.
76. On or about July 12, 2019, Michelle Whiteman sent an email to all of New Gulf
Coast's customers advising them that as of July 1, 2019, Perkins would be servicing New Gulf
Coast's accounts, and that funds due from before July 1, 2019 should be paid to New Gulf Coast,
and after July 1, 2019 to Perkins. A copy of this email is attached as Exhibit "14".
77. New Gulf Coast transferred certain of its equipment to Perkins and otherwise sold
the balance of the equipment that it had obtained from Gulf Coast, Inc.
COUNTERCLAIMS
COUNT I AGAINST PARTNERS
SPECIFIC PERFORMANCE (GENE AGAINST PARTNERS )
78. Gene repeats and re-alleges the allegations of paragraphs 1, 3, 4, 7-9, 11-15, 17-53
as if fully set forth.
79. Section 1.6 of the Post Org. Agreement provides that:
On such conversion and merger, Partners and Saltsman shall amend
the Saltsman Pledge to reflect the conversion and merger and
Saltsman may file updated financing statements to reflect the then
obligors and collateral with respect to the Saltsman Pledge.
80. The merger never took place.
81. Partners failed to grant Gene a security interest in any member units or any assets
of Gulf Coast, LLC.
82. Gene stands ready, willing and able to execute all necessary documents related to
the Saltsman Pledge and accompanying documents and to file updated financing statements to
reflect the obligors and collateral with respect to the Saltsman Pledge.
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83. Gene has no adequate remedy at law. He is entitled to the equitable remedy of
specific performance.
WHEREFORE, Plaintiff, Eugene Saltsman, requests this Court to enter a judgment
compelling Defendants, Partners Biomedical Solutions, LLC and MAC 15, LLC, to take all steps
necessary to grant Gene a security interest in all membership interests in, and all assets of Gulf
Coast Biomedical, LLC, effective as of January 1, 2019, award Gene his reasonable attorneys' fees
and costs, and for such further and additional relief as the Court deems just and appropriate under
the circumstances.
COUNT II INJUNCTIVE RELIEF (GENE AGAINST PARTNERS AND MAC 15, LLC)
84. Gene repeats and re-alleges each and every allegation in paragraphs 1, 3-77 as if
fully set forth.
85. Partners is in default under the Note by virtue of, among other things, breach of the
Pledge and security agreement, breach of the Operating Agreement, breach of the Post Op,
Agreement, the transfer of assets to Perkins and the failure to make payment of $500,000.00
pursuant to the Note on or before October 19, 2019.
86. Partners, MAC 15, Burke, Weltman, and Gulf Coast, LLC have engaged in conduct
and are continuing to engage in conduct that violates the Transaction Documents and the Post Op.
Agreement. Such conduct includes, but it not limited to:
a. refusing to amend the Saltsman Pledge,
b. refusing to grant Gene a security interest in member units of Gulf Coast,
LLC., and
c. misappropriating both Partners' and Gulf Coast, Inc.'s and Gulf Coast,
LLC’s assets for their personal gain and to cause additional harm to Gene.
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87. Unless these parties are temporarily, preliminarily and thereafter permanently
enjoined, Gene will be irreparably harmed by at least: loss of his secured creditor status and his
rights to foreclose on New Gulf Coast's assets, and otherwise exercise his rights as a secured
creditor under Florida law.
88. Gene has no adequate remedy at law.
WHEREFORE, Plaintiff, Eugene Saltsman, requests that the Court enter the following
Orders and grant the following relief:
a. Issuing a Preliminary Injunction and, thereafter, a Permanent Injunction
against Partners and MAC 15,
(1) to grant Gene a security interest in all member units and assets of
Gulf Coast, LLC;
(2) enjoining Partners and MAC 15 from transferring any assets,
including any of Gulf Coast, LLC's assets and including but not limited to incurring any charges
against Partners' credit card, other than to pay Chase Bank, effective immediately
b. Granting such other and further equitable and legal relief that the Court
deems just and proper.
COUNT III
(GENE AGAINST PARTNERS ON THE NOTE)
89. Gene repeats and re-alleges each and every allegation in paragraphs 1, 3, 4, 7, 8,
11-15, 17-45 as if fully set forth.
90. On October 19, 2018, Partners executed the Gene Note.
91. Partners breached the Note by failing to pay by failing to pay the first installment
of $500,000.00 on October 19, 2019, and thereafter.
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92. As of October 19, 2019, Partners owes Gene $2,500,000 in unpaid principal in
connection with the Gene Note, plus allowed interest and other fees as provided in the Note.
93. Gene has been damaged as a result of Partners' failure to make payment under the
Note.
WHEREFORE, Plaintiff, Eugene Saltsman, demand judgment against Defendant, Partners
Biomedical Solutions, LLC, in the amount of $2,500,000.00 in unpaid principal as of October 19,
2019, together with interest, costs, additional interest, attorneys' fees, and any further relief that
this Court deems just and proper.
COUNT IV
(GENE AGAINST PARTNERS ON THE NOTE)
94. Gene repeats and re-alleges each and every allegation in paragraphs 1, 7, 8, 11-15,
17-65 as if fully set forth.
95. On October 19, 2018, Partners executed the Note.
96. Partners breached Section 5 (b) of the Note which provides:
This Note shall rank senior to any other debt incurred by the
Company and the Company shall at all times until this Note is paid
in full inform in writing any subsequent lender of its subordinate
position. For the avoidance of doubt, the Company shall enter into a
subordination agreement with any other lender to ensure that the
provisions of this Section 5(b) are not breached.
97. Partners has incurred debts out of the ordinary course of business and paid them
without making payment under the Note.
98. As of October 19, 2019, Partners owes Gene $2,500,000.00 in unpaid principal in
connection with the Gene Note, plus allowed interest and other charges permitted by the Note.
99. Gene has been damaged as a result of Partners' wrongful acts.
WHEREFORE, Plaintiff, Eugene Saltsman, demands judgment against Defendant,
Partners Biomedical Solutions, LLC, in the amount of $2,500,000.00 in unpaid principal as of
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October 19, 2019, together with interest, costs, additional interest, attorneys' fees, and any further
relief that this Court deems just and proper.
COUNT V
(GENE AGAINST PARTNERS ON THE NOTE)
100. Gene repeats and re-alleges each and every allegation in paragraphs 1, 7-65, and
75-77of this Complaint as if fully set forth.
101. On October 19, 2018, Partners executed the Note.
102. Partners breached Section 5(c) of the Note which provides:
(c) The Company shall not take any action or become subject to
(including, without limitation, by way of amendment to or
modification of), any agreement or instrument which by its terms
would (under any circumstances) restrict the Company's right or
ability to perform the provisions of this Note or the Security
Agreement.
103. Gene's security interest in Gulf Coast, Inc. was not amended to become a security
interest in the ownership of Gulf Coast, LLC.
104. Assets of Gulf Coast, Inc. and Gulf Coast, LLC have been transferred to Perkins.
105. This constituted a breach of the Pledge and Security Agreement and a breach of the
Note.
106. As of October 19, 2019, Partners owes Gene $2,500,000.00 in unpaid principal in
connection with the Gene Note, plus allowed interest and related charges provided for under the
Note.
107. Gene has been damaged as a result of Partners' wrongful acts.
WHEREFORE, Plaintiff, Eugene Saltsman, demands judgment against Defendant,
Partners Biomedical Solutions, LLC, in the amount of $2,500,000.00 in unpaid principal as of
October 19, 2019, together with interest, costs, additional interest, attorneys' fees, and any further
relief that this Court deems just and proper.
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COUNT VI
(GENE AGAINST PARTNERS ON THE NOTE)
108. Gene repeats and re-alleges each and every allegation in paragraphs 1, 7-65, and
75-77 as if fully set forth.
109. On October 19, 2018, Partners executed the Note.
110. Partners breached 7(b) of the Note which provides:
(b) the Company shall default in the due observance or
performance of any covenant, representation, warranty, condition or
agreement on the part of the Company to be observed to be
performed pursuant to this Note or the Security Agreement,….
111. Section 8 of the Pledge and Security Agreement provides that Gulf Coast. Inc.'s or
Gulf Coast, LLC's (defined therein as Biomedical) assets shall not be transferred until the Note is
paid in full.
112. Some or all of Gulf Coast, Inc.'s assets were converted to Gulf Coast, LLC's assets
and subsequently some or all of these assets were transferred to Perkins.
113. The Note has not been paid in full.
114. The transfer of Gulf Coast's assets constitutes a default under the Note. Gene has
been damaged as a result.
115. As of October 19, 2019, Partners owes Gene $2,500,000.00 in unpaid principal in
connection with the Gene Note, plus allowed interest, reasonable attorneys' fees and additional
fees and costs.
116. Gene has been damaged as a result of Partners' wrongful acts.
WHEREFORE, Plaintiff, Eugene Saltsman, demands judgment against Defendant,
Partners Biomedical Solutions, LLC, in the amount of $2,500,000.00 in unpaid principal as of
October 19, 2019, together with interest, costs, additional interest, attorneys' fees, and any further
relief that this Court deems just and proper.
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COUNT VII
(GENE AGAINST PARTNERS ON THE NOTE)
117. Gene repeats and re-alleges each and every allegation in paragraphs 1, 3-77 as if
fully set forth.
118. On October 19, 2018, Partners executed the Note.
119. Partners breached Section 7(e) of the Note which provides:
(e) The Company's board of managers consents to, or otherwise
approves the transfer of all or substantially all of the Company's
assets or the cessation of substantially all of the Company's
operations or the winding-up of the Company's affairs.
120. Weltman and Burke have approved the winding up of Partners' affairs. Partners did
nothing other than receive a "management fee" from Old Gulf Coast and/or New Gulf Coast. Old
Gulf Coast and New Gulf Coast have no operations, no employees, no customers, and no business
location since the premises in West Palm Beach have been vacated.
121. Partners breached section 7 (e) of the Note.
122. As of October 19, 2019, Partners owes Gene $2,500,000.00 in unpaid principal in
connection with the Gene Note, plus allowed interest.
123. Gene has been damaged as a result of Partners' wrongful acts.
WHEREFORE, Plaintiff, Eugene Saltsman, demands judgment against Defendant,
Partners Biomedical Solutions, LLC, in the amount of $2,500,000.00 in unpaid principal as of
October 19, 2019, together with interest, costs, additional interest, attorneys' fees, and any further
relief that this Court deems just and proper.
COUNT VIII
(GENE AGAINST PARTNERS ON THE NOTE)
124. Gene repeats and re-alleges each and every allegation in paragraphs 1, 3, 4, 7, 8,
11-65, and 75-77as if fully set forth.
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125. On October 19, 2018, Partners executed the Note.
126. Partners breached Section 8 of the Note which provides:
8. No Dilution or Impairment. Except in the manner provided
in the last sentence of Section 8(b) of the Security Agreement, the
Company will not, by amendment of its Articles of Organization,
Operating Agreement or other governing documents, each as
amended, or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any
other voluntary action, avoid or seek to avoid the observance or
performance of any of the terms of this Note, but will at all times in
good faith assist in the carrying out of all such terms and in the
taking of all such action as be necessary or appropriate in order to
protect the rights of the Holder against dilution or other impairment.
127. Partners has intentionally failed to protect Gene's rights, as holder of the Note, from
impairment.
128. As of October 19, 2019, Partners owes Gene $2,500,000.00 in unpaid principal in
connection with the Gene Note, plus allowed interest.
129. Gene has been damaged as a result of Partners' wrongful acts.
WHEREFORE, Plaintiff, Eugene Saltsman, demands judgment against Defendant,
Partners Biomedical Solutions, LLC, in the amount of $2,500,000.00 in unpaid principal as of
October 19, 2019, together with interest, costs, additional interest, attorneys' fees, and any further
relief that this Court deems just and proper.
COUNT IX
BREACH OF CONTRACT (GENE AGAINST PARTNERS RE THE PLEDGE
AGREEMENT)
130. Gene repeats and re-alleges each and every allegation in paragraphs 1, 3, 4, 7, 8,
11-53 as if fully set forth.
131. On October 19, 2018, Partners executed the Amendment to Stock Purchase
Agreement wherein Partners was assigned all of the rights and obligations owed to Gene by NABS.
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These obligations included the Stock and Pledge Agreement, guaranteeing Gene's security interest
in the stock and membership interests in Gene's entities.
132. Partners breached Section 6 of the Pledge Agreement by failing to pay under the
Gene Note.
133. As a result of Partners' breach, Gene has been damaged.
WHEREFORE, Plaintiff, Eugene Saltsman, demands judgment against Defendant,
Partners Biomedical Solutions, LLC, for damages, together with interest, costs, additional interest,
attorneys' fees, and any further relief that this Court deems just and proper.
COUNT X
BREACH OF CONTRACT (GENE AGAINST PARTNERS RE PLEDGE AGREEMENT)
134. Gene repeats and re-alleges each and every allegation in paragraphs 1, 3, 4, 7, 8,
11-53 as if fully set forth.
135. On October 19, 2018, Partners executed the Amendment to Stock Purchase
Agreement wherein Partners was assigned all of the rights and obligations owed to Gene by NABS.
136. Partners breached its agreement by failing to protect Gene's security interest in
Gene's Entities, failing to amend the Stock and Pledge Agreements to reflect the Gene Entities'
conversion and merger into Gulf Coast, LLC, and taking all other steps necessary and required to
create a protected security interest in Gulf Coast, LLC for Gene.
137. As a result, Gene has been damaged.
WHEREFORE, Plaintiff, Eugene Saltsman, demands judgment against Defendant,
Partners Biomedical Solutions, LLC, for damages, together with interest, costs, additional interest,
attorneys' fees, and any further relief that this Court deems just and proper.
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COUNT XI
(ALFATWO AND GENE AGAINST PARTNERS,MAC 15, AND LOSOWE RE POST
CLOSING AGREEMENT)
138. Gene and Alphatwo repeat and re-allege each and every allegation in paragraphs 1,
3, 4, 15, and 17-65 as if fully set forth.
139. The Post Org. Agreement also provides that NABS assigned and Partners assumed
all rights and obligations in the Transaction Documents.
140. Section 1.6 of the Post Org. Agreement provides that:
On such conversion and merger, Partners and Saltsman shall amend
the Saltsman Pledge to reflect the conversion and merger and
Saltsman may file updated financing statements to reflect the then
obligors and collateral with respect to the Saltsman Pledge.
141. Partners and MAC 15 have failed to comply with Section 1.6 of the Post Org.
Agreement and amend the Saltsman Pledge to reflect the conversion of Gulf Coast, Inc. to Gulf
Coast, LLC and provide Gene with a replacement security interest in Gulf Coast, LLC.
142. As a result, Gene and Alphatwo have been damaged.
WHEREFORE, Plaintiffs, Eugene Saltsman and Alphatwo Holdings, LLC, demand
judgment against Defendants, Partners Biomedical Solutions, LLC and MAC 15, LLC and
LOSOWE for damages together with interest, costs, attorneys' fees, and any further relief that this
Court deems just and proper.
COUNT XII
FRAUDULENT TRANSFER PURSUANT TO FLORIDA STATUTES, §726.105(1)(a)
(GENE AS AGAINST PARTNERS)
143. Gene repeats and re-alleges each and every allegation in paragraphs 1, 5-9, 11-15,
17-66, and 75-77 of this Complaint as if fully set forth.
144. Section 726.105, Florida Statutes provides in relevant part as follows:
Transfers fraudulent as to present and future creditors.
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(1) A transfer made or obligation incurred by a debtor is fraudulent
as to a creditor, whether the creditor's claim arose before or after the
transfer was made or the obligation was incurred, if the debtor made
the transfer or incurred the obligation:
(a) with actual intent to hinder, delay or defraud any creditor of the
debtor;
145. New Gulf Coast transferred assets to Perkins, including but not limited to
equipment and the right to service accounts (the "Transfer").
146. At the time of the Transfer, Gene was a creditor of Partners which owned Gulf
Coast, Inc. Gene held a security interest in Gulf Coast, Inc. which was converted to New Gulf
Coast. Gene was also a creditor of Gulf Coast, LLC by virtue of having claims for unpaid
compensation pursuant to the Amended Employment Agreement
147. Pursuant to Section 1.6 of the Post. Org Agreement, upon conversion and merger
of the Gene Entities into Gulf Coast, LLC, Partners was required to amend the Saltsman pledge to
reflect the conversion and merger reflecting Gulf Coast, LLC as the new obligor and Gene's
collateral.
148. Gene was a creditor of Partners at the time of the transfer of New Gulf Coast's
equipment and the servicing of New Gulf Coast's customers.
149. But for the transfer of equipment and services to Perkins, Gulf Coast, LLC could
have provided an income stream to Partners thereby enabling it to pay the obligation it owed to
Gene.
150. The transfer of equipment and customers to service to Perkins was done with actual
intent, delay or defraud Gene in collecting on the Note.
WHEREFORE, pursuant to section 726.108, Florida Statutes, Plaintiff, Eugene Saltsman,
(i) demands judgment against Defendant, Partners Biomedical Solutions, LLC, for avoiding the
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fraudulent transfer of the Gene Entities' equipment and services to Perkins; (2) an attachment or
an injunction against Perkins; or (3) entry of an order allowing Gene to levy by way of execution
on the assets fraudulently transferred and their proceeds to satisfy the Note; and (4) such other and
further relief as the circumstances may require.
COUNT XIII
FRAUDULENT TRANSFER PURSUANT TO FLORIDA STATUTES, §726.105(1)(a)
(GENE AS AGAINST PARTNERS)
151. Gene repeats and re-alleges each and every allegation in paragraphs 1, 3, 4, 5-9, 11-
15, 17-65 as if fully set forth.
152. Section 726.105, Florida Statutes provides in relevant part as follows:
Transfers fraudulent as to present and future creditors.
(1) A transfer made or obligation incurred by a debtor is fraudulent
as to a creditor, whether the creditor's claim arose before or after the
transfer was made or the obligation was incurred, if the debtor made
the transfer or incurred the obligation:
(a) with actual intent to hinder, delay or defraud any creditor of the
debtor;
153. Gene was a creditor of Partners and held a security interest in Gulf Coast, Inc. which
was converted to New Gulf Coast.
154. Pursuant to Section 1.6 of the Post. Org Agreement, upon conversion and merger
of the Gene Entities into Gulf Coast, LLC, Partners was required to amend the Saltsman pledge to
reflect the conversion and merger reflecting Gulf Coast, LLC as the new obligor and Gene's
collateral.
155. Gulf Coast, Inc.'s assets were transferred to New Gulf Coast upon its conversion.
156. No security interest was provided to Gene with New Gulf Coast.
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157. The transfer of Gulf Coast, Inc.'s assets to New Gulf Coast without providing Gene
with a security interest in New Gulf Coast was done with actual intent, delay or defraud Gene in
collecting on his Note.
WHEREFORE, pursuant to section 726.108, Florida Statutes, Plaintiff, Eugene Saltsman,
(i) demands judgment against Defendant, Partners Biomedical Solutions, LLC for avoiding the
fraudulent transfer of the Gene security interest in Gulf Coast, Inc.; (2) an attachment or an
injunction against Gulf Coast, LLC and Gulf Coast, Inc.; or (3) entry of an order allowing Gene to
levy by way of execution on the assets fraudulently transferred and their proceeds to satisfy the
Note; and (4) such other and further relief as the circumstances may require.
COUNT XIV
FRAUDULENT TRANSFER PURSUANT TO FLORIDA STATUTE, § 726.105(1)(b)
(GENE AS AGAINST PARTNERS)
158. Gene repeats and re-alleges each and every allegation in paragraphs 1, 3-77 as if
fully set forth.
159. Section 726.105, Florida Statutes provides in relevant part as follows:
Transfers fraudulent as to present and future creditors.
(1) A transfer made or obligation incurred by a debtor is fraudulent
as to a creditor, whether the creditor's claim arose before or after the
transfer was made or the obligation was incurred, if the debtor made
the transfer or incurred the obligation: . . . (b) Without receiving a
reasonably equivalent value in exchange for the transfer or
obligation, and the debtor: . . 2. Intended to incur, or believed or
reasonably should have believed that he or she would incur, debts
beyond his or her ability to pay as they became due.
160. At the time of the Transfer, Gene was a creditor of Partners and held a security
interest in Gulf Coast, Inc. which was converted to New Gulf Coast.
161. Pursuant to Section 1.6 of the Post. Org Agreement, upon conversion and merger
of the Gene Entities into Gulf Coast, LLC, Partners was required to amend the Saltsman pledge to
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reflect the conversion and merger reflecting Gulf Coast, LLC as the new obligor and Gene's
collateral.
162. Partners and New Gulf Coast transferred to Perkins' certain of its equipment that it
had obtained from the Gene Entities, as well as, the servicing of the Gene Entities' customers
without receiving a reasonably equivalent value in exchange for the transfer.
163. Partners and Gulf Coast intended to incur, or believed, or reasonably should have
believed that they would incur debts beyond its ability to pay them as they became due because at
the time of the transfer, including but not limited to the Note. But for the transfer of certain of its
equipment that it had obtained from the Gene Entities, as well as, the servicing of the Gene Entities'
customers, could have provided an income stream to Partners and New Gulf Coast thereby
enabling Partners to pay the obligation it owed to Gene.
WHEREFORE, pursuant to section 726.108, Florida Statutes, Plaintiff, Eugene Saltsman,
(i) demands judgment against Defendant, Partners Biomedical Solutions, LLC, for avoiding the
fraudulent transfer of the Gene Entities' equipment and services to Perkins; (2) an attachment or
an injunction against Perkins; or (3) entry of an order allowing Gene to levy by way of execution
on the assets fraudulently transferred and their proceeds, including funds that have been transferred
back to Gulf Coast and/or Partners from Perkins or otherwise in order to satisfy the Note; and (4)
such other and further relief as the circumstances may require.
COUNT XV
FRAUDULENT TRANSFER PURSUANT TO FLORIDA STATUTES, §726.106(1)
(GENE AS AGAINST PARTNERS)
164. Gene repeats and re-alleges each and every allegation in paragraphs 1, 3-77 as if
fully set forth.
165. Section 726.106, Florida Statute provides in relevant part as follows:
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Transfers fraudulent as to present creditors
(1) A transfer made or obligation incurred by a debtor is fraudulent
as to a creditor whose claim arose before the transfer was made or
the obligation was incurred if the debtor made the transfer or
incurred the obligation without receiving a reasonably equivalent
value in exchange for the transfer or obligation and the debtor was
insolvent at that time or the debtor became insolvent as a result of
the transfer or obligation.
166. At the time of At the time of the Transfer, Gene held as security interest in Gulf
Coast, Inc. which was converted to New Gulf Coast.
167. Pursuant to Section 1.6 of the Post. Org Agreement, upon conversion and merger
of the Gene Entities into Gulf Coast, LLC, Partners was required to amend the Saltsman pledge to
reflect the conversion and merger reflecting Gulf Coast, LLC as the new obligor and Gene's
collateral.
168. Partners and New Gulf Coast transferred to Perkins' certain of the equipment that
it had obtained from Gulf Coast, Inc. and the servicing of Old Gulf Coast's and New Gulf Coast's
remaining customers without receiving a reasonably equivalent value in exchange for the transfer.
169. As a result of the transfer of New Gulf Coast's equipment and the servicing of New
Gulf Coast's customers, Partners became insolvent. They have liabilities greatly exceeding their
assets.
170. At the time of the transfer of New Gulf Coast's equipment and the servicing of
New Gulf Coast's customers, Gene was creditor of Gulf Coast, Inc. and New Gulf Coast pursuant
to the Amended Employment Agreement and a Creditor of Partners pursuant to the Pledge and
Security Agreement, the Operating Agreement, the Promissory Note, the Post. Org. Agreement
and a number of related documents
WHEREFORE, pursuant to section 726.108, Florida Statutes, Plaintiff, Eugene Saltsman,
(i) demands judgment against Defendant, Partners Biomedical Solutions, LLC, for avoiding the
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fraudulent transfer of the Gene Entities' equipment and services to Perkins; (2) an attachment or
an injunction against Perkins; or (3) entry of an order allowing Gene to levy by way of execution
on the assets fraudulently transferred and their proceeds to satisfy the Note; and (4) such other and
further relief as the circumstances may require.
PERMISSIVE COUNTERCLAIMS AND JOINDER OF PARTIES
Counter-plaintiffs, Gene, Evan, and Alphatwo sue counter-defendants, Burke, Weltman,
Gulf Coast, LLC, Losowe, and Perkins and allege:
COUNT XVI INJUNCTIVE RELIEF (GENE AGAINST BURKE, WELTMAN AND
GULF COAST, LLC)
171. Gene repeats and re-alleges each and every allegation in paragraphs 1, 5-65, and
75-77 as if fully set forth and brings the following claims as permissive counterclaims pursuant to
Rules 13 (h) and 20 (a)(2)(A) and (B) of the Federal Rules of Civil Procedure.
172. Partners is in default under the Note by virtue of, among other things, breach of the
Pledge and security agreement, breach of the Operating Agreement, breach of the Post Op,
Agreement, the transfer of assets to Perkins and the failure to make payment of $500,000.00
pursuant to the Note on or before October 19, 2019.
173. Partners, MAC 15, Losowe, Burke, Weltman and Gulf Coast, LLC have engaged
in conduct and are continuing to engage in conduct that violates the Transaction Documents and
the Post Op. Agreement. Such conduct includes, but it not limited to:
a. refusing to amend the Saltsman Pledge,
b. refusing to grant Gene a security interest in member units of Gulf Coast,
LLC., and
c. misappropriating both Partners' and Gulf Coast, Inc.'s and Gulf Coast,
LLC’s assets for their personal gain and to cause additional harm to Gene.
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174. Unless these parties are temporarily, preliminarily and thereafter permanently
enjoined, Gene will be irreparably harmed by at least: loss of his secured creditor status and his
rights to foreclose on New Gulf Coast's assets, and otherwise exercise his rights as a secured
creditor under Florida law.
175. Gene has no adequate remedy at law.
WHEREFORE, Plaintiff, Eugene Saltsman, requests that the Court enter the following
Orders and grant the following relief:
a. Issuing a Preliminary Injunction and, thereafter, a Permanent Injunction
against Defendants Robert Burke, Louis Weltman, and Gulf Coast Biomedical, LLC,
(1) to grant Gene a security interest in all member units and assets of
Gulf Coast, LLC;
(2) enjoining Burke, Weltman and Gulf Coast, LLC from transferring
any assets, including but not limited to incurring any charges against Partners' credit card, other
than to pay Chase Bank, effective immediately
b. Granting such other and further equitable and legal relief that the Court
deems just and proper.
COUNT XVII
BREACH OF STATUTORY DUTIES OF LOYALTY – F.S. §605.04091 (ALPHATWO
AGAINST BURKE AND WELTMAN)
176. Alfatwo repeats and re-alleges and incorporated the allegations of paragraphs 3-77
as if fully set forth herein.
177. Burke and Weltman are Partners' Managers.
178. The Florida Amended Limited Liability Act provides in part:
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(1) Each manager of a manager-membered limited liability
company . . .owes fiduciary duties of loyalty and care to the limited
liability company and members of the limited liability company.
(2) The duty of loyalty includes:
* * *
(c) The duty of care in the conduct…is to refrain from engaging
in grossly negligent or reckless conduct, willful or intentional
misconduct, or a knowing violation of the law.
179. Under Florida law and Partners' Operating Agreement, Burke and Weltman were
required to exercise their powers and otherwise perform their duties in good faith, using ordinary
prudence, as a person in a like position would use under similar circumstances.
180. Burke had no prior experience in the business of servicing biomedical equipment.
181. Weltman had no prior experience in the business of servicing biomedical
equipment.
182. Burke and Weltman intentionally failed to perform their duties and powers in good
faith in a number of ways, including, but not limited to:
a. Intentionally failing to obtain financing in contravention of Section 3.5 of
the Operating Agreement, thereby damaging the value of Alpha Two's interest and Partners' ability
to pay its obligations to Gene under the Note;
b. Grossly mismanaging Gulf Coast, Inc. and New Gulf Coast, which Partners
owned or intended to own, so as to alienate all of its employees and its customers, transferring its
assets and using the company's funds for their personal benefit, firing Gene when they had no one
else capable of managing Gulf Coast, Inc.'s or Gulf Coast, LLC's business, causing Partners to
default under various agreements with Gene, and causing Gulf Coast, Inc. to violate Gulf Coast,
Inc.'s agreements with Chase Bank.
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c. Grossly mismanaging Gulf Coast, Inc. and New Gulf Coast by terminating
Gene and, rather than hire a knowledgeable replacement, allowed Weltman, who had no prior
experience in the industry, to assume Gene's responsibilities; hiring Dean and West, personal
friends of Burke, to be the heads of sales and services, even though neither lived in the New York
tri-state area; and wasting company funds on computer software equipment that they thereafter did
not use because it was "no good," or words to that effect.
183. Weltman and Burke, through MAC 15 and Losowe, acquired a company that
regularly generated in excess of $2,000,000.00 in annual revenues, and within less than one year,
decimated it.
184. New Gulf Coast, which Partners owed or intended to own, has no employees, no
accounts, no equipment, no goodwill, all to the detriment of Gene, Alphatwo, the company's
former employees and its creditors, including, but not limited to, Gene and Chase Bank.
185. As a result, Alphatwo has been damaged by virtue of the diminution of the value
of its interest in Partners.
WHEREFORE, Plaintiff, Alphatwo Holdings, LLC, demands judgment against
Defendants, Robert Burke and Louis Weltman, for damages in an amount to be proven at trial,
together with interest, costs, additional interest, attorneys' fees, and any further relief that this Court
deems just and proper.
COUNT XVIII
BREACH OF CONTRACT (ALFATWO AGAINST BURKE AND WELTMAN UNDER
SECTION 3.5 OF PARTNERS' OPERATING AGREEMENT)
186. Alphatwo brings this action against Burke and Weltman, re-alleging and
incorporating the allegations of paragraphs 3 – 77 as if fully set forth herein.
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187. Paragraph 3.5 of the Operating Agreement provides in pertinent part: "Members
acknowledge and agree that in connection with the company's business, the Company shall obtain
financing, as may be required… Losowe, MAC15, and Friedman (and/or their respective members
and principals) shall be required to provide such personal guaranties and credit enhancements as
the lender reasonably requires…."
188. Burke and Weltman breached Section 3.5 of the Operating Agreement by failing to
obtain the required financing.
189. As a result of Burke and Weltman's breaches, Alphatwo has been damaged, since
Alfatwo's interest in Partners was rendered worthless.
WHEREFORE, Plaintiff, Alfatwo Holdings, LLC, demands that a judgment be entered
against Defendants, Robert Burke and Louis Weltman, for damages this Court determines Alfatwo
has suffered, the costs of this action, the pre-suit costs and attorneys' fees incurred, and any
additional relief this Court deems to be just and proper.
COUNT XIX BREACH OF CONTRACT
(GENE AGAINST LOSOWE, BURKE AND WELTMAN RE POST CLOSING
AGREEMENT)
190. Gene repeats and re-alleges each and every allegation in paragraphs 1, 5-9, 11-65-
as if fully set forth.
191. The Post Org. Agreement also provides that NABS assigned and Partners assumed
all rights and obligations in the Transaction Documents.
192. Section 1.6 of the Post Org. Agreement provides that:
On such conversion and merger, Partners and Saltsman shall amend
the Saltsman Pledge to reflect the conversion and merger and
Saltsman may file updated financing statements to reflect the then
obligors and collateral with respect to the Saltsman Pledge.
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193. Losowe, Burke and Weltman have failed to comply with Section 1.6 of the Post
Org. Agreement and amend the Saltsman Pledge to reflect the conversion of Gulf Coast, Inc. to
Gulf Coast, LLC and provide Gene with a replacement security interest in Gulf Coast, LLC.
194. As a result, Gene has been damaged.
WHEREFORE, Plaintiffs, Eugene Saltsman, demands judgment against Defendants,
Robert Burke, Louis Weltman, and Losowe Capital Inc., for damages together with interest, costs,
attorneys' fees, and any further relief that this Court deems just and proper.
COUNT XX
GROSS MISMANAGEMENT OF NEW GULF COAST (GENE AGAINST BURKE AND
WELTMAN)
195. Gene repeats and re-alleges each and every allegation in paragraphs 1, 5-9, 11-77
as if fully set forth.
196. Burke and Weltman are the managers of Partners.
197. Burke and Weltman are the managers of New Gulf Coast.
198. The Florida Amended Limited Liability Act provides in part:
(1) Each manager of a manager-membered limited liability
company . . .owes fiduciary duties of loyalty and care to the limited
liability company and members of the limited liability company.
(2) The duty of loyalty includes:
* * *
(c) The duty of care in the conduct…is to refrain from engaging
in grossly negligent or reckless conduct, willful or intentional
misconduct, or a knowing violation of the law.
199. Burke and Weltman owed Gene an undivided duty of loyalty.
200. Burke and Weltman mismanaged New Gulf Coast, by among other things:
a. failing to understand the specific business, including its operations, how to
grow the business, deal with customers, acquire equipment,
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b. not adequately or improperly capitalizing and/or funding the company;
c. terminating technicians, thereby leaving an inadequate number of persons;
present to assist customer needs, resulting in a loss of those customers;
d. causing Partners and New Gulf Coast to incur expenses for services such
as payroll, management and administrative, but failing to place competent and knowledgeable
persons in those positions;
e. improperly using corporate funds for their own personal use and gain;
f. diverting funds from New Gulf Coast to Partners, even though Partners
performs no services and is in default under the Gene Note;
g. failing to take corrective action against corporate profits declined in
contravention of their personal and contractual obligations;
h. failing to properly and adequately supervise technicians, resulting in several
resignations due to a toxic working environment Weltman created;
i. failing to replace Gene with a knowledgeable replacement, and instead
allowing Weltman, who had no prior experience in the industry, to assume Gene's responsibilities;
j. hiring Dean and West, personal friends of Burke, to be the heads of sales
and services, even though neither lived in the New York tri-state area; and
k. wasting company funds on computer software equipment that they
thereafter did not use because it was "no good," or words to that effect.
201. As a direct and proximate result of Burke and Weltman's gross mismanagement,
Gene suffered substantial damages, including but not limited to the diminishment of the value of
his interest in Partners, and Partners' inability to honor its obligations under the Note.
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WHEREFORE, Plaintiff, Eugene Saltsman, demands judgment against Defendants, Robert
Burke and Louis Weltman, for damages together with interest, costs, attorney's fees, and any
further relief that this Court deems just and proper.
COUNT XXI FRAUD IN THE INDUCEMENT(GENE AGAINST WELTMAN)
202. Gene repeats and re-alleges each and every allegation in paragraphs 1, 3, 4, 6-9, 12-
15, 17, 19-53 as if fully set forth.
203. Weltman induced Gene to sign the Transaction Documents.
204. Weltman represented to Gene that he would execute the Operating Agreement in
the capacity of a guarantor pursuant to Section 3.5, providing a personal guarantee and credit
enhancements as any lender required.
205. Weltman intentionally and materially omitted telling Gene that his guaranty was
worthless as a result of his filing of a Petition for Relief under Chapter 11 of Title 11 of the United
States Code in 2014 (the "Weltman Bankruptcy Case") resulting in the confirmation of a Plan of
Reorganization in 2016.
206. By virtue of the Weltman Bankruptcy Case, no commercial lender would make
Partners a loan or otherwise provide financing based upon Weltman's personal guaranty.
207. Weltman knew that his guaranty was worthless at the time he executed section 3.5
of the Operating Agreement. Weltman's failure to disclose the Weltman Bankruptcy Case and the
fact that his obligation to provide a personal guaranty was worthless constituted an intentionally
false representation.
208. Gene relied upon this representation at the time it was made.
209. Partners does not have the ability to honor the Note.
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210. Gene has been damaged by Weltman's intentionally false statement and fraudulent
act in inducing Alfa Two to enter into the Operating Agreement .
WHEREFORE, Plaintiff, Eugene Saltsman, demands judgment against Defendant, Louis
Weltman, for damages together with interest, costs, punitive damages, and any further relief that
this Court deems just and proper.
COUNT XXII CIVIL CONSPIRACY (GENE AGAINST BURKE AND WELTMAN)
211. Gene repeats and re-alleges each and every allegation in paragraphs 1, 3-77 as if
fully set forth.
212. Burke and Weltman conspired to commit an unlawful act against Gene; namely, to
defraud Gene out of the beneficial interest in the Gene Entities.
213. Burke and Weltman, commencing on a date unknown to Gene, but upon
information and belief sometime in May of 2018, and continuing thereafter up to and including
the filing of this pleading, agreed and conspired with each other to devise and scheme and
thereafter both perpetrated one or more overt acts within the state of Florida and in particularly
Palm Beach County in furtherance of the conspiracy in order to carry out their scheme and obtain
one or more of its objectives.
214. Burke and Weltman engaged in overt acts in furtherance of the conspiracy,
including, but not limited to, making misrepresentations of fact that:
a. Commencing on or about May 9, 2018, Weltman represented to Gene that:
(1) the acquisition of the Gene Entities would help Gene benefit form
an increase in value related to growth of his business by bringing in resources in the form of
management and strategy, as well as money, acquisitions and growth;
(2) the transaction would secure Gene with a pledge of securities that
would permit him to take his companies back in the event of a default on the Note; and
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(3) that the transaction was less of an acquisition but rather an
investment by Gene into his own business by bringing management on board to this companies
and allow for growth that he might otherwise be incapable or unwilling to do on his own;
(4) payment on the Note would occur;
(5) that they and the companies they managed and controlled would
protect Gene's Security Interest originally in the Gene Entities and then in New Gulf Coast,
including executing all necessary documents,
(6) they would bring financial resources to the table in the form of
management and strategy, as well as money.
215. Further overt acts include, but are not limited to, driving Gene out of his companies,
transferring the New Gulf Coast's assets to a third party, and using corporate funds for their own
personal use and benefit.
216. The representations and material omissions made by Weltman to Gene set forth
above were false and fraudulent when made and were part of an integral and continuing scheme
designed and perpetrated by Weltman, Burke, Losowe and MAC 15, to fraudulently induce Gene
to purportedly sell his interests in the Gene Entities, execute the Transaction Documents, provide
his experienced, valuable services, talents and energies to the financial and other advancement and
reward to the Defendants, and each of them, without paying Gene, to cheat Gene out of his rightful
ownership and security interest in New Gulf Coast and to purloin and convert to their own use
Gene's business contacts and relationships. Gene has been damaged as result of the acts done under
the conspiracy.
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WHEREFORE, Plaintiff, Eugene Saltsman, demands judgment against Defendants, Robert
Burke and Louis Weltman, for damages together with interest, costs, punitive damages, and any
further relief that this Court deems just and proper.
COUNT XXIII
FRAUDULENT TRANSFER PURSUANT TO FLORIDA STATUTES §726.105(1)(a)
(GENE AGAINST PARTNERS, GULF COAST, LLC AND PERKINS)
217. Gene repeats and re-alleges each and every allegation in paragraphs 1, 3-77 of this
Complaint as if fully set forth.
218. Section 726.105, Florida Statutes provides in relevant part as follows:
Transfers fraudulent as to present and future creditors.
(1) A transfer made or obligation incurred by a debtor is fraudulent
as to a creditor, whether the creditor's claim arose before or after the
transfer was made or the obligation was incurred, if the debtor made
the transfer or incurred the obligation:
(a) with actual intent to hinder, delay or defraud any creditor of the
debtor;
219. New Gulf Coast transferred assets to Perkins, including but not limited to
equipment and the right to service accounts (the "Transfer").
220. At the time of the Transfer, Gene was a creditor of Partners .
221. At the time of the Transfer, Gene was a creditor of Gulf Coast, LLC.
222. At the time of the Transfer, Partners owned Gulf Coast.
223. At the time of the Transfer, Gene held a security interest in Gulf Coast, Inc. which
had been converted to New Gulf Coast.
224. Pursuant to Section 1.6 of the Post. Org Agreement, upon conversion and merger
of the Gene Entities into Gulf Coast, LLC, Partners was required to amend the Saltsman pledge to
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reflect the conversion and merger reflecting Gulf Coast, LLC as the new obligor and Gene's
collateral.
225. Gene was a creditor of Partners and Gulf Coast, LLC at the time of the transfer of
New Gulf Coast's equipment and the servicing of New Gulf Coast's customers.
226. But for the transfer of equipment and services to Perkins, Gulf Coast, LLC could
have provided an income stream to Partners thereby enabling it to pay the obligation it owed to
Gene.
227. The transfer of equipment and customers to service to Perkins was done with actual
intent, delay or defraud Gene in collecting on his Note.
WHEREFORE, pursuant to section 726.108, Florida Statutes, Plaintiff, Eugene Saltsman,
(i) demands judgment against Defendants, Gulf Coast Biomedical, LLC and Perkins Biomedical
Services, LLC, for avoiding the fraudulent transfer of the Gene Entities' equipment and services
to Perkins; (2) an attachment or an injunction against Partners, Gulf Coast, LLC and Perkins; (3)
entry of an order allowing Gene to levy by way of execution on the assets fraudulently transferred
and their proceeds, including proceeds returned to Gulf Coast LLC and /or Partners to satisfy the
Note; and (4) such other and further relief as the circumstances may require.
COUNT XXIV
FRAUDULENT TRANSFER PURSUANT TO FLORIDA STATUTES, §726.105(1)(a)
(GENE AGAINST GULF COAST, LLC)
228. Gene repeats and re-alleges each and every allegation in paragraphs 1, 3, 4, 5-9, 11-
15, 17-77 as if fully set forth.
229. Section 726.105, Florida Statutes provides in relevant part as follows:
Transfers fraudulent as to present and future creditors.
(1) A transfer made or obligation incurred by a debtor is fraudulent
as to a creditor, whether the creditor's claim arose before or after the
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transfer was made or the obligation was incurred, if the debtor made
the transfer or incurred the obligation:
(a) with actual intent to hinder, delay or defraud any creditor of the
debtor;
230. Gene was a creditor of Partners and held a security interest in Gulf Coast, Inc. which
was converted to New Gulf Coast.
231. Pursuant to Section 1.6 of the Post. Org Agreement, upon conversion and merger
of the Gene Entities into Gulf Coast, LLC, Partners was required to amend the Saltsman pledge to
reflect the conversion and merger reflecting Gulf Coast, LLC as the new obligor and Gene's
collateral.
232. Gulf Coast, Inc.'s assets were transferred to New Gulf Coast upon its conversion.
233. No security interest was provided to Gene with New Gulf Coast.
234. The transfer of Gulf Coast, Inc.'s assets to New Gulf Coast without providing Gene
with a security interest in New Gulf Coast was done with actual intent, delay or defraud Gene in
collecting on his Note.
WHEREFORE, pursuant to section 726.108, Florida Statutes, Plaintiff, Eugene Saltsman,
(i) demands judgment against Defendant, Gulf Coast Biomedical, LLC for avoiding the fraudulent
transfer of the Gene security interest in Gulf Coast, Inc.; (2) an attachment or an injunction against
Gulf Coast, LLC and any of its assets; or (3) entry of an order allowing Gene to levy by way of
execution on the assets fraudulently transferred and their proceeds to satisfy the Note; and (4) such
other and further relief as the circumstances may require.
COUNT XXV
FRAUDULENT TRANSFER PURSUANT TO FLORIDA STATUTE, § 726.105(1)(b)
(GENE AGAINST PARTNERS, GULF COAST, LLC AND PERKINS)
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235. Gene repeats and re-alleges each and every allegation in paragraphs 1, 3-77 as if
fully set forth.
236. Section 726.105, Florida Statutes provides in relevant part as follows:
Transfers fraudulent as to present and future creditors.
(1) A transfer made or obligation incurred by a debtor is fraudulent
as to a creditor, whether the creditor's claim arose before or after the
transfer was made or the obligation was incurred, if the debtor made
the transfer or incurred the obligation: . . . (b) Without receiving a
reasonably equivalent value in exchange for the transfer or
obligation, and the debtor: . . 2. Intended to incur, or believed or
reasonably should have believed that he or she would incur, debts
beyond his or her ability to pay as they became due.
237. Partners and New Gulf Coast transferred to Perkins' certain of its equipment that it
had obtained from Gulf Coast, Inc., as well as the servicing of the Gulf Coast's customers without
receiving a reasonably equivalent value in exchange for the transfer.
238. At the time of the Transfer, Gene was a creditor of Partners
239. At the time of the Transfer, Gene was a creditor of Gulf Coast, LLC.
240. At the time of the Transfer, Gene held a security interest in Gulf Coast, Inc. which
had been converted to New Gulf Coast.
241. Pursuant to Section 1.6 of the Post. Org Agreement, upon conversion and merger
of the Gene Entities into Gulf Coast, LLC, Partners was required to amend the Saltsman pledge to
reflect the conversion and merger reflecting Gulf Coast, LLC as the new obligor and Gene's
collateral.
242. At the time of the Transfer, Partners and Gulf Coast, LLC intended to incur, or
believed, or reasonably should have believed that they would incur debts beyond their ability to
pay them as they became due.
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WHEREFORE, pursuant to section 726.108, Florida Statutes, Plaintiff, Eugene Saltsman,
(i) demands judgment against Defendants, Gulf Coast Biomedical, LLC and Perkins Biomedical
Services, LLC, for avoiding the fraudulent transfer of the Gene Entities' equipment and services
to Perkins; (2) an attachment or an injunction against Perkins and Gulf Coast, LLC; (3) entry of
an order allowing Gene to levy by way of execution on the assets fraudulently transferred and their
proceeds, including funds in the possession of Gulf Coast, LLC and Partners to satisfy the Note;
and (4) such other and further relief as the circumstances may require.
COUNT XXVI
FRAUDULENT TRANSFER PURSUANT TO FLORIDA STATUTES, §726.106(1)
(GENE AGAINST PARTNERS, GULF COAST, LLC AND PERKINS)
243. Gene repeats and re-alleges each and every allegation in paragraphs 1, 3-77 as if
fully set forth.
244. Section 726.106, Florida Statute provides in relevant part as follows:
Transfers fraudulent as to present creditors
(1) A transfer made or obligation incurred by a debtor is fraudulent
as to a creditor whose claim arose before the transfer was made or
the obligation was incurred if the debtor made the transfer or
incurred the obligation without receiving a reasonably equivalent
value in exchange for the transfer or obligation and the debtor was
insolvent at that time or the debtor became insolvent as a result of
the transfer or obligation.
245. Partners and New Gulf Coast transferred to Perkins' certain of the equipment that
it had obtained from Gulf Coast, Inc. and the servicing of Old Gulf Coast's and New Gulf Coast's
remaining customers without receiving a reasonably equivalent value in exchange for the transfer.
246. At the time of At the time of the Transfer, Gene held as security interest in Gulf
Coast, Inc. which was converted to New Gulf Coast.
247. Pursuant to Section 1.6 of the Post. Org Agreement, upon conversion and merger
of the Gene Entities into Gulf Coast, LLC, Partners was required to amend the Saltsman pledge to
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reflect the conversion and merger reflecting Gulf Coast, LLC as the new obligor and Gene's
collateral. Partners failed to comply with this requirement.
248. At the time of the transfer of New Gulf Coast's equipment and the servicing of
New Gulf Coast's customers, Gene was creditor of Partners.
249. At the time of the transfer of New Gulf Coast's equipment and the servicing of
New Gulf Coast's customers, Gene was creditor of Gulf Coast, Inc. and New Gulf Coast pursuant
to the Amended Employment Agreement and a Creditor of Partners pursuant to the Pledge and
Security Agreement, the Operating Agreement, the Promissory Note, the Post. Org. Agreement
and a number of related documents
250. As a result of the transfer of New Gulf Coast's equipment and the servicing of New
Gulf Coast's customers, Partners and New Gulf Coast became insolvent. They have liabilities
greatly exceeding their assets.
WHEREFORE, pursuant to section 726.108, Florida Statutes, Plaintiff, Eugene Saltsman,
(i) demands judgment against Defendant, Gulf Coast Biomedical, LLC and Perkins Biomedical
Services, LLC, for avoiding the fraudulent transfer of the Gene Entities' equipment and services
to Perkins; (2) an attachment or an injunction against Partners and Gulf Coast, LLC, Perkins; or
(3) entry of an order allowing Gene to levy by way of execution on the assets fraudulently
transferred and their proceeds to satisfy the Note, including all funds in Partners' and Gulf Coast
LLC's possession; and (4) such other and further relief as the circumstances may require.
COUNT XXVII
BREACH OF CONTRACT (GENE AGAINST GULF COAST, LLC RE EMPLOYMENT
AGREEMENT)
251. Gene repeats and re-alleges each and every allegation in paragraphs 1, 5-9, 11-53
as if fully set forth.
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252. An employment agreement existed between Gene and Gulf Coast, Inc.
253. Gulf Coast, Inc. was converted to Gulf Coast, LLC.
254. Pursuant to the Employment Agreement as amended, Gene was entitled to certain
payments, in the amount of $39,600.00.
255. Gulf Coast, Inc. wrongfully refused to pay Gene the amount due pursuant to his
amended Employment Agreement as amended.
256. Gulf Coast, Inc. breached the Employment Agreement as amended .
257. As a result, Gene has suffered damages in the amount of $39,600.00.
WHEREFORE, Plaintiff Eugene Saltsman, demands judgment against Defendant, Gulf
Coast Biomedical, LLC, for damages together with interest, costs, attorneys' fees, and any further
relief that this Court deems just and proper.
COUNT XXVIII
BREACH OF ORAL AGREEMENT (EVAN AGAINST GULF COAST, LLC RE
EMPLOYMENT AGREEMENT)
258. Evan repeats and re-alleges each and every allegation in paragraphs 2, 9, 13-15, 17,
50, 52, 53, 67, 68 as if fully set forth.
259. An oral Employment Agreement existed between Evan and New Gulf Coast.
260. Pursuant to the oral agreement, Evan provided services to New Gulf Coast.
261. New Gulf Coast breached the oral agreement by failing and refusing to pay Evan
for services performed.
262. As a result, Evan has suffered damages in the amount of $12,400.00.
WHEREFORE, Plaintiff, Evan Saltsman, demands judgment against Defendant, Gulf
Coast Biomedical, LLC, for damages together with interest, costs, and any further relief that this
Court deems just and proper.
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COUNT XXIX
QUANTUM MERUIT (EVAN AS AGAINST GULF COAST)
(Alternative Count)
263. Evan repeats and re-alleges each and every allegation in paragraphs 2, 9, 13-15, 17,
50, 52, 53, 67, 68 as if fully set forth.
264. Evan performed services on behalf of New Gulf Coast and New Gulf Coast
acquiesced in the provision of those services.
265. New Gulf Coast was aware that Evan expected to be compensated for the services
he performed.
266. New Gulf Coast was and has been unjustly enriched by Evan's services.
WHEREFORE, Plaintiff, Evan Saltsman, demands judgment against Defendant, Gulf
Coast Biomedical, LLC, for damages together with interest, costs, and any further relief that this
Court deems just and proper.
/s/ Eric A. Rosen
Eric A. Rosen
Fla. Bar No. 36426
Email: [email protected]
FOWLER WHITE BURNETT, P.A.
Northbridge Centre
515 North Flagler Drive, Suite 2100
West Palm Beach, Florida 33401
Telephone: (561) 802-9044
Facsimile: (561) 802-9976
Alexandra L. Tifford
Florida Bar No. 0178624
Email: [email protected]
FOWLER WHITE BURNETT, P.A.
Brickell Arch
1395 Brickell Ave., 14th Floor
Miami, FL 33131
Tel: 305-789-9200
Fax: 305-789-9201
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CERTIFICATE OF SERVICE
I hereby certify that on December 4th, 2019, the foregoing document was electronically
filed with the Clerk of the Court using CM/ECF. I also certify that the foregoing document is
being served this day on all counsel of record on the attached Service List in the manner specified,
either via transmission of Notices of Electronic Filing generated by CM/ECF or in some other
authorized manner for those counsel or parties who are not authorized to receive electronically
Notices of Electronic Filing.
s/ Eric A. Rosen
Eric A. Rosen
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SERVICE LIST
CASE NO.
Avery Chapman
Chapman Law Group, PLC
12008 South Shore Blvd., Ste. 105
Wellington, FL 33414
Counsel for MAC 15, LLC and Partners
Gary Woodfield, Esquire
Haile, Shaw & Pfaffenberger, P.A.
660 U.S. Highway One
Third Floor
North Palm Beach, FL 33408
Counsel for Reichel Realty & Investments, Inc.
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