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Plaintiffs Aidan Foley (Foley) and AF Double Eagle, Inc. (Double Eagle. and together with Foley, Plaintiffs) allege in their Complaint against Defendants Elliot Aintabi, Jason Aintabi (together the Aintabis), Jesta Digital, LLC (Jesta Digital), and Does I through 10, inclusive (collectively Defendants), as follows:
INTRODUCTION 1. Aidan Foley has over 20 years of executive level management experience in the

technology and entertainment industries. Foley founded and is CEO of Double Eagle. Prior to
founding Double Eagle, Foley was the Chief Marketing Officer and President of the Enterprise Solutions Group of Ascent Media, an $800 million global business of Liberty Media. Prior to

Ascent Media, Foley served as CEO of Kodaks Digital Entertainment Division. 2. (Fox In or about October 2009, Foley was contacted by personnel at Fox Mobile Group

obile), a division of News Corp., about News Corp.s plan to sell Fox Mobile. The

opportunity to bid on the asset was strictly confidential and open to select bidders by invitation only.
News Corp. invited Foley to bid on Fox Mobile. As a result, Foley, on behalf of Double Eagle, enteied into a non-disclosure agreement with News Corp (the Fox NDA) to protect the

confidential nature of the sale of Fox Mobile.

3. After he signed the Fox NDA, Foley began looking for investors to contribute capital

for the purchase of Fox Mobile. He offered the investment opportunity to a small group of handpicked investors and entered into a non-circumvention agreement with each of them to protect Foleys and Double Eagles right and interest in the purchase of Fox Mobile.
4.

One of these hand-picked investors was the Aintabi family, who conduct business

through the name Jesta Group. The business is controlled by father and son, Defendants Elliot Aintabi and Jason Aintabi, respectively. 5. On or about December 17, 2009, Double Eagle and the Aintabis entered into a

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Confidentiality and Non-Circumvention Agreement (the Non-Circumvention Agreement). The Non-Circumvention Agreement was intended to, and does. preserve and protect Foleys/Double Eagles right to purchase Fox Mobile. The Aintabis had neither the right nor the ability to purchase Fox Mobile on their own; the Non-Circumvention Agreement expressly prohibited it.

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6.

The name Jesta Group is on the Non-Circumvention Agreement. However, on

information and belief Jesta Group was not a legally-formed or legally-existing entity at the time the contract was entered into and at the time the wrongdoing herein occurred.
7.

Jesta Group is defined in the Non-Circumvention Agreement as including any

subsidiaries, affiliates, partners, or related entities of any of the parties to that agreement. As such, this includes Elliot Aintabi, Jason Aintabi and Jesta Digital, the Defendants named herein. 8. In December 2010, after the wrongdoing herein occurred, a limited liability company

named Jesta Group, LLC was formed. On information and belief, this entity, Jesta Group, LLC, was created after-the-fact in order to evade the legal liability herein. 9. The Non-Circumvention Agreement was entered into in December 2009. Thereafter,

Plaintiffs worked on the Fox Mobile purchase extensively for over a year. Using his expertise in the industry, and through an extensive period of due diligence, Foley developed a business plan to make the company profitable. He managed the due diligence process. He communicated with Fox Mobile. He developed relationships with the News CoI investment bankers responsible for managing the sale 10. he worked with Defendants to structure the purchase

Foley saw the Fox Mobile purchase as a once-in-a-lifetime opportunity. He poured

his energy, resources and time into the project. 11. After working with Plaintiffs for about a year, in late 2010 Defendants went dark and

stopped communicating with Foley; and shortly thereafter they acquired Fox Mobile on their own. In doing so, they repudiated and breached the Non-Circumvention Agreement.
12. Defendants also committed fraud. Throughout 2010, as set forth in detail below,

Defendants represented, numerous times, that that they would purchase Fox Mobile with Plaintiffs. Defendants represented to Plaintiffs that they would provide the financing for the purchase. And Defendants told Foley that after the purchase, he would become Chief Executive Officer (CEO) of the company. 13. These representations were false. Defendants planned to acquire Fox Mobile on their

own, but they needed Plaintiffs expertise and contacts to land the deal. For a year, they strung Plaintiffs along, extracting what they needed from Plaintiffs so they could take the deal for 2
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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

themselves. Defendants waited until the Non-Circumvention Agreement expired to spring their trap, thinking this would somehow insulate them from liability (it does not).
THE PARTIES

14.

Plaintiff Double Eagle is, and at all times relevant to this Complaint was, a

corporation organized and operating under the laws of the State of California, with its principal place of business located in Los Angeles, California.
15.

Plaintiff Foley is, and at all times relevant to this Complaint was, a resident of Los

Angeles County. Foley is the founder and owner of Double Eagle. 16. Plaintiffs are informed and believe, and on that basis allege, that Defendant Jesta

Digital is, and at all times relevant to this Complaint was, a Delaware limited liability company with its principal place of business located in New York, New York. 17. Plaintiffs are infonried and believe, and on that basis allege, that Defendant Elliot

Aintabi is, and at all times relevant to this Complaint was, a resident of the State of New York. 18 Plaintiffs are informed and believe, and on that basis allege, that Defendant Jason

Arntabi is, and at all times relevant to this Complaint was, a resident of the State of New York. 19. Plaintiffs are infonued and believe, and on that basis allege, that Defendants Does I

through 10, inclusive, are individually and/or jointly liable to Plaintiffs for the wrongs alleged herein. The true names and capacities, whether individual, corporate, associate or otherwise, of Defendants Does 1 through 10, inclusive, are unknown to Plaintiffs at this time. Accordingly, Plaintiffs sue Defendants Does 1 through 10, inclusive, by fictitious names and will amend this Complaint to allege their true names and capacities after they are ascertained. 20. Plaintiffs allege that each of the Defendants is, and at all times relevant to this

Complaint was, the employee, agent, employer, partner, joint venturer, alter ego, affiliate, principal, and/or co-conspirator of the other Defendants and, in doing the acts alleged herein, was acting within the course and scope of such positions at the direction of, and/or with the permission, knowledge, consent and/or ratification of the other Defendants. As such, each Defendant, through its acts and omissions, is responsible for the wrongdoing alleged herein and for the damages suffered by Plaintiffs. 3
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JURISDICTION AND VENUE

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21.

The Court has personal jurisdiction over each and every Defendant because the Non

Circumvention Agreement provides, inter a/ia, that [t]he parties hereby irrevocably consent to the jurisdiction of the state and federal courts located in Los Angeles, California in any action arising out of or relating to this Agreement, and waive any other venue to which either party may be entitled by domicile or otherwise. (Non-Circumvention Agreement, Agreement is attached hereto as Exhibit A.
22.

14.) The Non-Circumvention

Plaintiffs initially filed this action in the Central District of California based on

diversity of citizenship: Aiden Foley, an individual; AF Double Eagle, Inc., a California

corporation vs. Elliot Aintabi, an individual; Jason Aintabi, an individual. Jesta Digital, LLC, a Delaware limited liability company; and Does 1 through JO, inclusive, USDC Case No. CV-1302592-DSF (SSx). Judge Dale Fischer dismissed the case without prejudice because Plaintiffs did not allege the citizenship of the members of Defendant Jesta Digital, LLC. Despite reviewing the corporate records, Plaintiffs have been unable to ascertain the citizenship of the members of Jesta Digital, the members do not appear to be listed therein As a result, Plaintiffs hae filed this case in California State Court.
FACTUAL ALLEGATIONS A. The Deal

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<

23.

In October 2009, Foley was contacted by personnel at Fox Mobile Group about its

potential sale. Fox Mobile provides ring tones, video and other content to its customers mobile devices on a subscription basis. At the time, News Corp. owned Fox Mobile and wanted to sell it. The sale of Fox Mobile was confidential. 24. Fox Mobile put Foley in touch with News Corp. After discussing the opportunity,

Foley decided to pursue it. News Corp. required Foley to enter into a non-disclosure agreement (the Fox NDA). Foley, on behalf of Double Eagle, executed the Fox NDA and thereafter began looking for potential investors to raise the capital necessary to purchase Fox Mobile. 25. In December 2009, Foley was introduced to Jason Aintabi. They discussed the Fox

Mobile sale and the possibility of Defendants providing the capital for the parties to buy the
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COMPLAINT

149023.1

company. Defendants thereafier agreed, and represented to Plaintiffs, that they would provide the capital for the acquisition of Fox Mobile. Defendants had no contacts at Fox Mobile; they learned of
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the sale of Fox Mobile from Foley. 26. On December 17, 2009, Defendants and Double Eagle entered into the Non-

Circumvention Agreement. The agreement provides, in part, as follows: WHEREAS, Recipient [Jesta] requires certain information from Discloser [Double Eagle] in connection with consideration of a possible transaction or relationship between Recipient and Discloser relating to a business acquisition target and/or opportunity as described in Schedule A, the nature and parties to which are of a confidential nature (the Transaction). (Non-Circumvention Agreement, p. 1.) The term of this Agreement shall be for a period of one year beginning on the Effective Date of this Agreement (the Term). (Id., 3.) Confidential Information shall include all information or material that has or could have commercial value or other utility in the business or prospective businesses of Discloser; all information and know-how, whether or not in tangible form, that is disclosed by one party (Discloser) to the other (Recipient)... By example and without limitation, Confidential Information includes, but is not limited to, the proposal materials, project, and Transaction information of Discloser. (Id., 1.)
Recipient agrees not to circumvent or attempt to circumvent this Agreement in an effort to gain for it, or deny to Discloser, any potential development, investment, acquisition, profits, fees, commissions, remuneration or considerations to the benefit of Discloser which would otherwise be owed to Discloser. It is the intent of both Parties that Recipient shall not, independent of Discloser, use or take advantage of the Confidential Information, Discloser contacts, Discloser partners, Discloser know-how or expertise developed or disclosed by Discloser to Recipient during the Terms of this Agreement. (Id., 4 [bold in

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original].)

Recipient shall apprise Discloser of all communications, developments, facts, proposals, offers, and other matters material to the Transaction, unless and until Discloser elects to disassociate from the Transaction. (Id.,J4.) Recipient and its Representatives shall use the Confidential Information solely for the purpose of evaluating a possible Transaction or relationship with Discloser and shall not in any way use the Confidential Information to the detriment of Discloser. (Id., 7.)

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COMPLAINT
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B.

Plaintiffs Put the Deal To2ether

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27.

Plaintiffs worked tirelessly, and without compensation, for a year putting together the

purchase of Fox Mobile. This entailed a great deal of work and occurred in phases; in each phase, it was Plaintiffs efforts that kept the transaction moving forward. 28. Plaintiffs put together a due diligence team, including accountants, bankers and

industry experts, to review and analyze Fox Mobiles financials, corporate structure, and employees and their contracts. Plaintiffs and this team identified areas where they could make the company more efficient. They analyzed the market in which Fox Mobile competes, developed models and forecasts, and put together a business plan for strategic opportunities and growth. 29. Plaintiffs identified key executives and other employees they would need after the

purchase of Fox Mobile and also identified structural changes that could be made to improve profitability. 30. Plaintiffs put together a legal team to review Fox Mobiles tax structure and

contractsemployment and businessand to analyze Fox Mobiles legal exposure, including how the purchase would impact that exposure. 31. Plaintiffs prepared to complete the transaction; and to that end, Plaintiffs entered into

agreements with, among others, investment bankers Siemer & Associates. Over the course of the year-long process, Plaintiffs continually adapted to keep the transaction moving forward. 32. Defendants did
not perform

the due diligence and did not assemble the teams to

review the viability of Fox Mobile as an acquisition target. Defendants did not even know the company was for sale before Plaintiffs disclosed it to them. Plaintiffs did this work. 33. During the bidding phase, Plaintiffs developed information on the other parties

bidding for Fox Mobile, including the number and identities of the competing bidders and the
structure

of their bids. As a result of Plaintiffs efforts and diligence, Plaintiffs secured an exclusive

34.

negotiating period with News Corp. Plaintiffs contacts and expertise were crucial in getting the exclusive period and ultimately the deal.

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 1 16 17 18 19 20 21 22 23 24 25 26 27 28

35.

During the exclusive negotiating period, Plaintiffs dug deep into Fox Mobiles

business. Plaintiffs traveled to Fox Mobiles offices in Berlin, Germany and met with financial and industry experts to gather information; and they met with executives at Fox Mobile and News Corp. as well as News Corps bankers. Plaintiffs refined their models, forecasts and market strategy in light of this information. 36. Plaintiffs were in constant communication with Fox Mobile personnel and its

investment bankers handling the deal. Plaintiffs negotiated the terms of the transaction, including its structure and price. Plaintiffs succeeded in lowering the purchase price and structuring the transaction on more favorable terms. 37. At the same time, Plaintiffs negotiated with other investors to provide additional

funds, if necessary, for Plaintiffs to purchase Fox Mobile. Defendants initially told Plaintiffs that they were not willing to finance the entire deal and that they only wanted to finance the debt portion of the purchase. 38. By early November 2010, Plaintiffs had succeeded in substantially reducing the sale
it

price of the company As a result, Defendants asked Plaintiffs

they could provide all the capital

necessary for the parties joint purchase. Plaintiffs agreed. In November 2010, Plaintiffs began preparing to close the purchase. 39. Plaintiffs performed due diligence for closing the transaction. Plaintiffs were in

communication with Fox Mobile and Defendants. Plaintiffs due diligence team worked to close the transaction before the end of the year. 40. However, in or about December 2010, Defendants stopped communicating with

Plaintiffs. Prior to that time, Plaintiffs had disclosed to Defendants critical and confidential information necessary for closing the transaction. Plaintiffs shared with Defendants all the confidential information that was developed from Plaintiffs contacts and efforts. 41. When Plaintiffs had nothing left to give, Defendants stopped responding to Plaintiffs

ernails and stopped communicating with Plaintiffs. Having obtained what they needed, Defendants discarded Plaintiffs and bought the company on their own.

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
<

42.

Defendants closed the purchase of Fox Mobile in or about late December 2010. On

information and belief, the business of Fox Mobile is now owned by Defendant Jesta Digital.
C. Defendants Fraud

43.

Elliot Aintabi and Jason Aintabi are father and son. Together, father and son, conduct

business through the name Jesta Group. Each Defendant acts by and through the others. The son acts for, and at the direction of the father, and vice versa; and both father and son act on behalf of the Jesta Group. The misrepresentations of one Defendant are attributable to all Defendants. Each Defendant acts by and through the others. The son acts for, and at the direction of the father; and vice versa. The misrepresentations of one Defendant are attributable to all Defendants. 44. Defendants represented to Plaintiffs on multiple occasions that they would provide

the capital for the parties acquisition of Fox Mobile. In April 2010, Foley met Jason Aintabi in
New York. At this meeting, Jason Aintabi told Foley that Defendants would provide the capital for

the parties acquisition of Fox Mobile. Jason Aintabi also told Foley at this meeting that Foley would be Chief Executive Officer (CEO) of Fox Mobile and would run the business after the purchase
45.

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On May 5, 2010, July 6, 2010 and August 23, 2010, Jason Aintabi represented to

Foley that (1) Foley would be CEO of Fox Mobile and run the business after the purchase; (2) Defendants were committed to the bid for Fox Mobile; and (3) Defendants would provide the capital for the parties acquisition of the company. 46. Defendants also represented that they would provide the capital for the acquisition of

Fox Mobile in meetings with Plaintiffs and third parties. Specifically, on or about November 17, 2010, at a meeting in Defendants offices, Elliot Aintabi told Foley, and third parties, that the final bid for Fox Mobile should be submitted to Allen & Company jointly from Defendants and Double Eagle to reflect the parties joint role in the acquisition. 47. On that same day, Plaintiffs and Defendants met at Allen & Companys offices with

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News Corp., Fox Mobile and Allen & Company persoimel regarding the acquisition of Fox Mobile. Elliot Aintabi again reiterated to everyone at the meeting that Defendants were providing the capital for the parties acquisition of the company.
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1 2 3 4 5

48.

Defendants lied to Foley about making him CEO of the business while they schemed

to buy Fox Mobile on their own. Defendants strung Plaintiffs along for months to buy time for them to collect the confidential information they needede.g., the due diligence, the business plan and the contactsto close the deal without Plaintiffs. 49. On November 29, 2010, Andrew Berkowitz, a senior executive at Jesta, sent Foley an

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email asking for more information about Fox Mobile. The email asked: Can you answer these questions: 1. Most current balance sheet; 2. Most current AIR and A/P detail possible; 3. Percentage of true subscribers vs. customers across the system; 4. Are there any major carrier or content license agreements at risk of not being assigned in this transaction?; 5. Re Chum: we are trying [to] determine how long customers currently stay on the J/J and other platforms and how that has changed from past years (i.e., the stickiness).
50.

Foley believed that Defendants needed this information as part of their due diligence.

He trusted and relied on Defendants representation that they were providing the money for the parties to acquire Fox Mobile. Defendants sought this information under false pretenses.
51.

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In December 2010, Jason Aintabi told Plaintiffs that the Aintabis contacted Fox

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Mobile directly to help Plaintiffs with closing the acquisition. Foley believed Jason Aintabi, trusted Defendants and relied on this, and their other, representation(s). As a result, Foley allowed Defendants to directly contact Fox Mobile and News Corp. on the condition that they keep him apprised as provided in the Non-Circumvention Agreement. 52. Defendants lied to Foley about their true intent for engaging Fox Mobile in direct

talks. They told Foley that the ability to directly communicate with Fox Mobile would facilitate closing the acquisition of the company. In truth, Defendants wanted direct contact with Fox Mobile so they could purchase Fox Mobile on their own and without Plaintiffs.
53.

In December 2010, Plaintiffs began to suspect that Defendants direct

communications with Fox Mobile were not in Plaintiffs best interests and withdrew their consent for Defendants to communicate directly with Fox Mobile, as permitted by the terms of the parties Non-Circumvention Agreement.

9
COMPLAINT
149023.1

54.

This lawsuit is for breach of contract and for fraud. It seeks recovery of the damages

provided by lawincluding disgorgement/restitution, lost profits, out-of-pocket losses and unjust

3 4 5 6 7 8 9 10 11
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enrichmentand punitive damages.

FIRST CASUE OF ACTION (Breach of Contract

AF Double Eagle against All Defendants)

55.

Plaintiffs hereby repeat, reallege and incorporate each and every allegation above as

if fully set forth herein, and further allege as follows:

56.

On about December 17, 2009, Defendants entered into the i.Jon-Circumvention

Agreement with Double Eagle, a valid and binding written agreement.

57.

Double Eagle has performed all conditions, covenants and promises required on its

part to be performed under the terms of the Non-Circumvention Agreement, except as excused by Defendants wrongful conduct.
58.

12 [3 14

Defendants materially breached the Non-Circumvention Agreement by usurping

Double Eagles right to acquire Fox Mobile. The purpose and effect of the Non-Circumvention Agreement was to preserve and protect Plaintiffs right to purchase Fox Mobile.
59.

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Defendants had neither the right nor the ability to purchase the company; the Non-

Circumvention Agreement expressly prohibited it. Defendants acts negated Plaintiffs right and ability to acquire Fox Mobile. 60. Defendants further materially breached the Non-Circumvention Agreement by the

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following wrongful acts: a. Defendants misused the confidential information Plaintiffs provided them pursuant to the Non-Circumvention Agreement to acquire Fox Mobile without Plaintiffs participation; b. Defendants engaged in direct, secret communications with Fox Mobile but did not disclose those communications to Double Eagle; and c. Defendants continued to engage in direct communication with Fox Mobile in disregard of Double Eagle withdrawing its consent to such communications.

10
COMPLAINT
149023.1

61.

As a proximate result of Defendants material breaches of the Non-Circumvention

2
3

Agreement, Double Eagle has been damaged in an amount in excess of $100,000,000, or according to proof at trial. 62. In the alternative, Double Eagle seeks the equitable remedy of disgorgernent.

4
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Defendants were unjustly enriched in at least the following ways and in an amount in excess of $100,000,000, or according to proof at trial: (1) Defendants acquired Fox Mobile on their own and have retained all the profit for themselves; and (2) Defendants obtained all of Plaintiffs confidential informatione.g., including the due diligence, the business plan and the personal contactsat no cost to Defendants. 63. Defendants would not have been able to acquire Fox Mobile on their own and would

not have received Plaintiffs confidential information but for the Non-Circumvention Agreement and Double Eagles performance thereunder. 64. Plaintiffs are informed and believe, and on that basis allege, that Defendants plan to

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,

sell Fox Mobile (now called Jesta Digital). The sale of the company will result in Defendants obtaining all the profit from the acquisition of Fox Mobile, thereby unjustly enriching Defendants
65.

<

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Double Eagle accordingly seeks the remedy of a constructive trust being placed on

the proceeds from any sale of this business.

SECOND CAUSE OF ACTION (Promissory Fraud against all Defendants)

66.

Plaintiffs hereby repeat, reallege and incorporate each and every allegation above as

if fully set forth herein, and further allege as follows: 67. Defendants made the following misrepresentations to Plaintiffs: a. In an April 2010 meeting with Foley, and verbally on or about May 5, 2010, July 6, 2010 and August 23, 2010, Jason Aintabi told Foley that (1) Foley would be CEO of Fox Mobile and run the business after the purchase; (2) Defendants were committed to the bid for Fox Mobile; and (3) Defendants would provide the capital for the parties acquisition of the company.

28

11
COMPLAINT
149023.1

b.
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On November 17, 2010, in a meeting at Defendants offices in New York, Elliot Aintabi told Foley and others that Defendants would provide the capital for the purchase of Fox Mobile and said that any bid for the company should come from both Defendants and Double Eagle to reflect the parties joint role in the acquisition.

c.

Also on November 17, 2010, at a separate meeting at Allen & Companys offices with representatives from News Corp., Fox Mobile, Allen & Company and Foley, Elliot Aintabi reiterated Defendants commitment to finance the parties acquisition of Fox Mobile.

68.

Defendants made these representations knowing them to be false and with the intent

to deceive Plaintiffs. Defendants knew that they were planning to acquire Fox Mobile on their own and that they were not going to make Foley CEO of the business. Defendants engaged in this fraudulent scheme because they needed Plaintiffs expertise and contacts to keep the deal moving forward and get it done. 69 Defendants intended for Plaintiffs to rely on their misrepresentations and induced

Plaintiffs to act in reliance on them. Specifically, Defendants intended their misrepresentations to induce Plaintiffs to: (1) choose Defendants as their capital investor; (2) perform the due diligence necessary to close the deal; (3) disclose Plaintiffs confidential information to Defendants; and (4) allow Defendants to engage in direct talks with Fox Mobile, News Corp. and Allen & Company. 70. Plaintiffs justifiably relied on these misrepresentations to their detriment. Indeed,

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every known written and oral representation made by Defendants to Plaintiffs and third parties, including Fox Mobile, News Corp. and Allen & Company, supported Plaintiffs belief. 71. Defendants failed to perform as represented. Instead of providing the capital in

support of the parties bid for the company, Defendants acquired the company for themselves, ousting Plaintiffs from the transaction. 72. Plaintiffs changed their position and relied on Defendants false representations

described herein. Had Plaintiffs known Defendants true intent, Plaintiffs would not have chosen them as the capital investor for the parties acquisition of Fox Mobile. 12
COMPLAINT

149023.1

73.

Plaintiffs also would not have disclosed their confidential information

the due

2
3

diligence, the business plan and the contacts

to Defendants. And Plaintiffs would not have allowed

Defendants to engage Fox Mobile, News Corp. or Allen & Company in direct talks. 74. As a direct and proximate result of Defendants false representations, they acquired

4
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Fox Mobile on their own and ousted Plaintiffs from the purchase, damaging Plaintiffs in an amount in excess of$ 100,000,000, or according to proof at trial, as follows: a. b. c.
75.

Loss of profits; Disgorgement/restitution for unjust enrichment; and Transaction costs.

Plaintiffs are informed and believe, and on that basis allege, that Defendants plan to

sell Fox Mobile (now called Jesta Digital). The sale of the company will result in Defendants obtaining all the profit from the acquisition of Fox Mobile that they fraudulently acquired, unjustly enriching Defendants. 76. Defendant Jesta Digital aided and abetted the fraudulent scheme. Jesta Digital is

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owned and controlled by the Aintabis. As such, it was necessarily aware of the Aintabis misrepresentations to Plaintiffs. Jesta Digital provided substantial assistance to the fraudulent scheme: on information and belief, the Aintabis used it as the entity to acquire Fox Mobile for themselves; and Jesta Digital now owns Fox Mobile so it obtained the benefits of the fraud. 77. Plaintiffs accordingly seek the remedy of a constructive trust being placed on the

operating profits and proceeds from any sale of this business.

78. Defendants conduct was committed with the intent of depriving Plaintiffs of their

rights and causing Plaintiffs other injuries. Defendants conduct was despicable and subjected Plaintiffs to unjust hardship. Defendants conduct was malicious, fraudulent and oppressive, and was committed with a conscious disregard for Plaintiffs rights. Accordingly, Plaintiffs are entitled to an award of punitive or exemplary damages in an amount sufficient to punish Defendants and to make an example of them.

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1 2 3
4

THIRD CASUE OF ACTION (Concealment against All Defendants)

79.

Plaintiffs hereby repeat, reallege and incorporates each and every allegation above as

if fully set forth herein, and further allege as follows. 80. Defendants concealed material information and made material misrepresentations to

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7

Plaintiffs, causing them to, among other things: (1) choose Defendants as their capital investor; (2) perform the due diligence on Fox Mobile necessary to close the deal; (3) disclose Plaintiffs confidential information to Defendants; and (4) allow Defendants to engage in direct talks with Fox Mobile, News Corp. and Allen & Company. 81. Specitically, Defendants concealed the fact that they were planning to acquire Fox

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Mobile on their own and oust Plaintiffs from the transaction. Defendants also concealed the fact that they never intended to make Foley CEO of the business after the purchase. By making these representations, Defendants undertook a duty to speak honestly and completely. 82. Defendants had a duty to disclose that they were not willing to provide the capital for

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the parties acquisition of Fox Mobile and were instead going to acquire it for themselves, without Plaintiffs. And Defendants had a duty to disclose that they did not intend to make Foley CEO of the business after the purchase. 83. These representations and promises created a relationship of trust and confidence

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between the parties. Defendants promises to Plaintiffs, which were not in the Non-Circumvention Agreement, independently created a relationship of trust and confidence between the parties. 84. Defendants concealed the fact that they were not planning to provide the capital for

the parties acquisition of Fox Mobile, as they had promised. Instead, they intended to squeeze as much information out of Plaintiffs as they could before acquiring the company on their own. 85. Plaintiffs were completely unaware of Defendants true intentions. If Plaintiffs had

known, they would have chosen a different capital investor. They would not have disclosed their confidential informationthe due diligence, the business plan and the contactsto Defendants. And they would not have allowed Defendants to engage Fox Mobile, News Corp. or Allen & Company in direct talks. 14

149023, I

COMPLAINT

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2

86.

Plaintiffs changed their position and relied to their detriment on Defendants

concealments and misrepresentations described herein. As a direct and proximate result of this conduct, Defendants acquired Fox Mobile for themselves and ousted Plaintiffs from the purchase, damaging Plaintiffs in an amount in excess of $100,000,000, or according to proof at trial.
87.

Plaintiffs are informed and believe, and on that basis allege, that Defendants plan to

sell Fox Mobile (now called Jesta Digital). The sale of the company will result in Defendants obtaining all the profit from the acquisition of Fox Mobile that they fraudulently acquired, unjustly enriching Defendants. 88. As alleged herein, the Aintabis used Jesta Digital to accomplish their fraudulent

scheme. Plaintiffs accordingly seek the remedy of a constructive trust being placed on the operating profits and proceeds from any sale of this business. 89. Defendants conduct was committed with the intent of depriving Plaintiffs of their

rights and causing Plaintiffs other injuries. Defendants conduct was despicable and subjected Plaintiffs to unjust hardship. Defendants conduct was malicious, fraudulent and oppressive, and was committed with a conscious disregard for Plaintiffs rights. Accordingly, Plaintiffs are entitled to an award of punitive or exemplary damages in an amount sufficient to punish Defendants and to make an example of them.
FOURTH CASUE OF ACTION (Intentional Misrepresentation against All Defendants)

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90.

Plaintiffs hereby repeat, reallege and incorporates each and every allegation above as

if fully set forth herein, and further allege as follows. 91. As described above, Defendants represented multiple times to Plaintiffs that they

were committed to Plaintiffs bid for Fox Mobile, that Defendants would provide the capital for the purchase of Fox Mobile and that Foley would be CEO of the business. Defendants lied to Plaintiffs in these representations. 92. In addition, Defendants misrepresented to Foley the purposes for which they sought

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infonnation from Plaintiffs and sought direct contact with Fox Mobile:

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1 2 3 4

a.

In or about December 2010, Jason Aintabi contacted Fox Mobile directly and told Plaintiffs that direct contact would facilitate the closing of the deal to jointly acquire Fox Mobile.

b.

On November 29, 2010, Andrew Berkowitz, a senior executive at Jesta, sent Foley an email requesting detailed information about Fox N obiles financials, its customer base and its customers habits under the pretense that the information was necessary to close the deal for the parties to acquire Fox Mobile.

5 6 7
8 9 10 11 12 13 14
2

93.

Defendants made these misrepresentations knowing them to be false and with the

intent to deceive Plaintiffs. Defendants knew that they planned to acquire Fox Mobile for themselves. Defendants engaged in this fraudulent scheme because they needed Plaintiffs expertise and contacts to keep the deal moving forward and get it done. 94. Defendants intended for Plaintiffs to rely on their misrepresentations and induced

Plaintiffs to act in reliance on them. Specifically, Defendants intended their misrepresentations to induce Plaintiffs to: (1) choose Defendants as their capital investor; (2) perform the due diligence on Fox Mobile necessary to close the deal; (3) disclose Plaintiffs confidential information to Defendants; and (4) allow Defendants to engage in direct talks with Fox Mobile, News Corp. and Allen & Company. 95. Plaintiffs justifiably relied on these misrepresentations to their detriment. Instead of

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providing the capital in support of the parties bid for the company, Defendants acquired the company for themselves, ousting Plaintiffs from the transaction. 96. Plaintiffs changed their position and relied on Defendants false representations

described herein. Had Plaintiffs known Defendants true intent, Plaintiffs would not have chosen Defendants as the capital investor for the parties acquisition of Fox Mobile. Plaintiffs would not have disclosed their confidential informationthe due diligence, the business plan and the contactsto Defendants. And Plaintiffs would not have allowed Defendants to engage Fox Mobile, News Corp. or Allen & Company in direct talks.

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1 2 3 4 5 6 7 8 9 10 11 12 13 14

97.

As a direct and proximate result of Defendants false representations, they acquired

Fox Mobile on their own and ousted Plaintiffs from the purchase, damaging Plaintiffs in an amount in excess of $100,000,000, or according to proof at trial, as described above. 98. Plaintiffs are informed and believe, and on that basis allege, that Defendants plan to

sell Fox Mobile (now called Jesta Digital). The sale of the company will result in Defendants obtaining all the profit from the acquisition of Fox Mobile that they fraudulently acquired, unjustly enriching Defendants. 99. As alleged herein, the Aintabis used Jesta Digital to accomplish their fraudulent

scheme. Plaintiffs accordingly seek the remedy of a constructive trust being placed on the operating profits and proceeds from any sale of this business. 100. Defendants conduct was committed with the intent of depriving Plaintiffs of their

rights and causing Plaintiffs other injuries. Defendants conduct was despicable and subjected Plaintiffs to unjust hardship. Defendants conduct was malicious, fraudulent and oppressive, and was committed with a conscious disregard for Plaintiffs rights. Accordingly, Plaintiffs are entitled to an award of punitive or exemplary damages in an amount sufficient to punish Defendants and to make an example of them.
FIFTH CASUE OF ACTION (Constructive Fraud against All Defendants)

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101.

Plaintiffs hereby repeat, reallege and incorporates each and every allegation above as

if fully set forth herein, and further allege as follows. 102. The Non-Circumvention Agreement, and the promises made therein, created a

confidential relationship between the Parties. Defendants additional promises to Plaintiffs that they would provide the capital for the parties acquisition of company and make Foley the CEO of the businesswhich were not in the Non-Circumvention Agreementindependently created a relationship of trust and confidence between the parties. 103. Defendants assured Plaintiffs that they were working together to submit a joint bid for

Fox Mobile and that Foley would be CEO of the Fox Mobile business after the acquisition. And

17
COMPLAINT
149023.1

Plaintiffs shared confidences with Defendants regarding diligence, negotiation of the purchase price and strategy to complete the deal. 104. Plaintiffs trusted and relied on Defendants because of the promises in the Non-

2
3

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Circumvention Agreement and the promises Defendants made to Plaintiffs after they executed that agreement, as described above. As a result, Plaintiffs: (1) chose Defendants as the capital investor; (2) perfonried the due diligence necessary to close the acquisition of Fox Mobile; (3) disclosed their confidential informationthe due diligence, the business plan and the contactsto Defendants; and
(4) allowed Defendants to engage Fox Mobile, News Corp. or Allen & Company in direct talks.

105.

Despite this confidential and special relationship, Defendants concealed the fact that

they were planning to acquire Fox Mobile on their own and oust Plaintifis from the transaction. They concealed that they intended to squeeze as much information out of Plaintiffs as they could before acquiring the company without Plaintiffs. They also misrepresented to Plaintiffs that Foley would be CEO of the business and that they would provide the capital for the parties acquisition of the company 106 Given the facts alleged herein, in addition to the parties confidential and special

16 17 18 19 20 21 22 23 24 25 26 27

relationship, Plaintiffs justifiably relied on Defendants concealments and misrepresentations. 107. Plaintiffs changed their position and relied to their detriment on Defendants

concealments and misrepresentations described herein. As a direct and proximate result of this conduct, Defendants acquired Fox Mobile and ousted Plaintiffs from the purchase, damaging Plaintiffs in an amount in excess of$ 100,000,000, or according to proof at trial. 108. Plaintiffs are informed and believe, and on that basis allege, that Defendants plan to

sell Fox Mobile (now called Jesta Digital). The sale of the company will result in Defendants obtaining all the profit from the acquisition of Fox Mobile that they fraudulently acquired, unjustly enriching Defendants. 109. As alleged herein, the Aintabis used Jesta Digital to accomplish their fraudulent

scheme. Plaintiffs accordingly seek the remedy of a constructive trust being placed on the operating profits and proceeds from any sale of this business.

28

18
COMPLAINT
149023.1

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
<.

110.

Defendants conduct was committed with the intent of depriving Plaintiffs of their

rights and causing Plaintiffs other injuries. Defendants conduct was despicable and subjected Plaintiffs to unjust hardship. Defendants conduct was malicious, fraudulent and oppressive, and was committed with a conscious disregard for Plaintiffs rights. Accordingly, Plaintiffs are entitled to an award of punitive or exemplary damages in an amount sufficient to punish Defendants and to make an example of them.
SIXTH CAUSE OF ACTION (Aiding and Abetting Fraud against Jesta Digital)

111.

Plaintiffs hereby repeat, reallege and incorporates each and every allegation above as

if fully set forth herein, and further allege as follows. 112. Jesta Digital is owned and controlled by Elliot Aintabi and Jason Aintabi, and the

Aintabis acted by and through Jesta Digital. As such, Jesta Digital is charged with knowledge of the fraudulent scheme to acquire Fox Mobile without Plaintiffs participation. Jesta Digital is also charged with the misrepresentations and concealments alleged herein. 113. Jesta Digital actively participated in the fraud and substantially assisted it.

16 17 18 19 20 21 22 23 24 25 26 27 28

Specifically, on information and belief Jesta Digital is the company that bought Fox Mobile from News Corp. at the direction of the Aintabis. As such, Jesta Digital was essential for completing the fraudulent scheme alleged herein. 114. As a direct and proximate result of this conduct, Defendants (including Jesta Digital)

acquired Fox Mobile and ousted Plaintiffs from the purchase, damaging Plaintiffs in an amount in excess of S 100,000,000, or according to proof at trial. 115. Plaintiffs are informed and believe, and on that basis allege, that Defendants plan to

sell Fox Mobile (now called Jesta Digital). The sale of the company will result in Defendants obtaining all the profit from the acquisition of Fox Mobile that they fraudulently acquired, unjustly enriching Defendants. 116. Plaintiffs accordingly seek the remedy of a constructive trust being placed on the

operating profits and proceeds from any sale of this business.

19
COMPLAINT
149023.1

1 2 3 4 5 6 7 8 9 10 11 12

117.

Jesta Digitals conduct was committed with the intent of depriving Plaintiffs of their

rights and causing Plaintiffs other injuries. Jesta Digitals conduct was despicable and subjected Plaintiffs to unjust hardship. Jesta Digitals conduct was malicious, fraudulent and oppressive, and
was committed with a conscious disregard for Plaintiffs rights. Accordingly, Plaintiffs are entitled

to an award of punitive or exemplary damages in an amount sufficient to punish Jesta Digital and to make an example of them. PRAYER FOR RELIEF WHEREFORE, Plaintiffs respectfully pray for judgment against Defendants, as follows: 1. 2. 3. business; 4. 5. 6 7. 8. constructive trust; attorneys fees; pre- and post-judgment interest costs of this suit; and for such other and further relief as the Court may deem just and proper. compensatory damages in excess of $100,000,000, or according to proof at trial; punitive damages; restitution/disgorgement of operating profits and proceeds from any sale of the

13 14 15

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19

DATED: April 22, 2013

MILLER BARONDESS, LLP

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By:________________________________ L IS R. MILLER Attorneys for Plaintiffs Aidan Foley and AF Double Eagle, Inc.
. . -

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COMPLAINT
I 49023.1

DEMAND FOR JURY TRIAL

Plaintiffs Aidan Foley and AF Double Eagle, Inc. hereby demand a jury trial.

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DATED: April 22, 2013

MILLER

LOl R. MILLER Attorneys for Plaintiffs Aidan Foley and AF Double Eagle, Inc.

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COMPLAINT
11Qfl7 1

EXHIBIT A

CONFIDENTIALITY AND NON.CIRCUMVENTION AGREEMEN T

This CONFIDENTIALITY AND NON-CIRCUM VENTION AGREEMENT (the Agreement) is entered into on December 2009 (Effective Date) by and between cq. (Company or Recipient) located at .S Aa -i.. / i- &,, t.54 (oc z 4 , and AF Double Eagle, Inc. (Double Eagle or Discloser) located at 10900 Wilshire Boulevard, Suite 400, Los Angeles, CA 90024, (each a Party and collectively the Parties, including any of their respective current or future subsidiaries, affiliates, partners, or related entitie s. Double Eagle will disclose and otherwise provide Recipient with certain Confidential Inform ation as defined herein
,

WHEREAS, Recipient requires certain information from Discloser in connection with consideration of a possible transaction or relationship betwee n Recipient and Discloser relating to a business acquisition target and/or opportunity as described in Schedule A, the nature and parties to which are of a confidential nature (the Transaction);

WHEREAS, in the course of consideration of the Transaction, Discloser may disclose to Recipient confidential, important, and/or proprietary trade secret information concerning Discloser, its business activities, opportunities, relationships , contacts, partners, clients, etc.; THEREFORE, the Pai-ries agree to enter into a confidential relatio nship with respect to the disclosure by Discloser to Recipient of certain information. 1. Definitions. For purposes of this Agreement, Confidential Inform ation shall include all information or material that has or could have comme rcial value or other utility n the business or prnspective businesses of Discloser; all inform ation and know-how, whether or not in tangible form, that is disclosed by one party (Discloser) to the other (Recipient) and is related to the business, technical, or financial affairs of the disclosing party or its parent, subsidiaries, or affiliates. Confidential Information may includ e, without limitation, any invention (whether patentable or not), projects, development s, real estate, vendor information, suppliers, products, formulas, methods, techniques, customer/clien t/investor information (in particular, identities, names, activities, arid transactions), trade secrets , processes, research, reports, financial data, technical data, software code, softwa re documentation, hardware design, technology, marketing or business plans, forecasts, financial statements, budgets, licenses, prices, cost or personnel data. Failure to mark or designate any Proprietary Information as confidential or proprietary shall not affect its status as Proprietary Information under this Agreement. Notwithstanding any of the foregoing, nothing will be deemed confidential unless it relates specifically to the opportunity describ ed on Schedule A. By example and without limitation, Confidential Information include but s, is not limited to, the proposal materials, project, and Transaction information of Disclo ser. For purposes of this Agreement, the term Representative shall include Recipients directors, officers, employees, agents, partners, atTiliates, and financial, legal, and other advisors.

AF Doubic Ea Inc. (0900 Wiklrc Sivd. Suic 400 Los AnecIcs, CA 90024 www. A FDbIcEagic.coc

2. Exclusions. Confidential Information does not include information that Recipient can demonstrate: (a) was in Recipients possession prior to its being furnished to Recipient under the terms of this Agreement, provided the source of that information was not known by Recipient to be bound by a confidentiality agreement with or other continual, legal or fiduciary obligation of confidentiality to Discloser; (b) is now, or hereafter becomes, through no act or failure to act on the part of Recipient, genera lly known to the public; (c) is rightfully obtained by Recipient from a third party, without breach of any obligation to Discloser; or (d) is independently developed by Recipient withou t use of or reference to the Confidential Information.
3. Confidentiality. Recipient, Discloser and their Representatives shall not disclose any of the Confidentiaj rnformation in any manner whatso ever, except as provided in paragraphs 4 and 5 of this Agreement, and shall hold and maintain the Confidential Information in strictest confidence. The term of this Agreement shall be for a period of one year beginning on the Effective Date of this Agreement (the Term ). Recipient hereby agrees to indemnify Discloser against any and all losses (including, but not limited to, direct losses and those that are consequential and reasonably foresee able), damages, claims, expenses, and attorneys fees incurred or suffered by Disclo ser as a result of a breach of this Agreement by Recipient or any of its Representatives. Without the prior written consent of the Discloser, Recipient will not, and Recipient will direct its Representatives not to, disclose to any person (a) that the Confidential Information has been made available to Recipient or its Representatives, (b) that discussions are taking place concerning a Transaction, or (c) any terms or other facts with respect to the Transaction, including the status thereof 4. Non-Circumvention. Recipient hereby agrees to abstain from circum venting the intent and terms of this Agreement by means or use of affiliat es, subsidiaries, individuals, or any other entities or Representatives to which the benefit s may run to Recipient indirectly, whether by direct payment, payments In kind, agreem ents, or any other type of beneficial treatment or consideration. Recipient agrees not to circumvent or attempt to circumvent this Agreement in an effort to gain for It, or deny to Discloaer, any potential development, investment, acquisition, profits, fees, commissions, remuneration or considerations to the benefit or Discloser which would otherwise be owed to Discloser. It is the intent of both Parties that Recipient shall not., indepe ndent of Discloser, use or take advantage of the Confidential Information, Discloser contacts, Discloser partners, Discloser know-bow or expertise developed or disclos ed by DIscloser to Recipient during the Term of this Agreement.

Upon Disclosers written consent, Recipient may initiate direct communication with the acquisition target(s) subject to the Transaction. Discloser reserves the right to withdraw such consent at any time in the event Discloser determ ines Recipients communication with the target company or any other party to the Transaction is not in Disclosers best interests. Recipient shalt apprise Discloser of all communicatio ns, developments, facts, proposals, offers, and other matters material to the Transaction, unless and until Discloser elects to disassociate from the Transaction.

5. Permitted Disclosures. Recipient may disclose Confidential Information to Recipients responsible Representatives with a bona tide need to know such Confidential Information, bat only to the extent necessary to evaluate or carry Out a proposed transaction or relationship with Discloser and only if such employees are advised of the confidential nature of such Confidential Information and the terms of this Agreement and are bound bya written agreement or by a legally enforceable code of professional responsibility to preserve and protect the confidentiality of such Confidential Information.

6. Repuird Disclosures, Recipient may disclose Confidential Information if arid to the extent that such disclosure is required by an order issued by a federal or state court of competent jurisdiction, provided that Recipient provides Discloser a reasonable opportunity to review the disclosure before it is made and to interpose its own objection to the disclosure.
7. L. Recipient and its Representatives shall use the Confidential Information solely for the purpose of evaluating a possiblc Transaction or relationsbip with Discloser and shall not in any way use the Confidential information to the detriment of Discloser. Nothing in this Agreement shall be construed as granting any rights or other legally cognizablc proprietary interest to Recipient, by license or otherwise, to any of Disclosers Confidential Information. 8. Return of Documcnts. [f Recipient does not proceed with the possible transaction with Discloser, Recipient shall, if the Discloser requests in its sole discretion, return to Discloser any and all records, notes, and other written, electronic, printed or other tangible materials in its possession pertaining to the Confidential Information. Such return of materials shall not relieve Recipient and its. Representatives from their respectLve obligations to comply with the other terms and conditions of this Agreement. 9. No Additional Agreements. Neither the holding of discussions nor the exchange of materials or information shall be construed as an obligation of Discloser to enter into any other agrcement with Recipient or prohibit Discloser from providing the same or similar information to other parties and entering into agreements with other parties. Discloser reserves the right, in its sole discretion, to reject any and all proposals made by Recipient or any of its Representatives with regard to a ti-ansaclion between Recipient and Discloser and to terminate discussions and negotiations with Recipient or any of its Representatives at any time and for any reason. Any additional agreement between the parties, if any, shall be executed in writing and signed by Discloser and Recipient. 10. Irreparable Harm. Recipient understands and acknowledges that any disclosure or misappropriation by it or any of its Representatives of any of the Confidential Information in violation of this Agreement may cause Discloser irreparable harm, the amount of which may be difficult to ascertain, and therefore agrees that Discloser shall have the right to apply to a court of competent jurisdiction for specific performance andJor an order restraining and enjoining any such further disclosure or breach and for such other relief as Discloser shall deem appropriate. Such right of Discloser is to be in addition to the remedies otherwise

available to Discloser at law or in equity. Recipient and its Representatives hereby expressly waive the defense or assertion that a remedy in damages vill be adequate. II. Representations and Warranties. Double Eagle has not and shall not be deemed to have made anv representations or warranties as to the accuracy or completeness of the Confidential Information. Only those representations or warran ties which are made by the pertinent party in a final definitive agreement regarding a Transa ction, when, as and if ex ecuted, and subject to such limitations and restrictions as may be specified therein, will have any legal effect.

1 2. Survival. This Agreement shall continue in full force and effect for one year from execution by both panics. If one or more provisions of this Agreement should be deemed to be unenforceable by a court of competent jurisdi ction, it is the intention of the parties that the remainder of the Agreement be enforced to the maximum extent that such enforcement is allowable under California law.
13. Successors and Assigns. This Agreement and each partys obligations hereunder shall be binding on the representatives, assigns, and successors of such party and shall inure to the benefit of the assigns and successors of such party; provided, however, that the rights, duties and obligations of Recipient and Discloser hereunder are not assignable. 14. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California, withou t regard to conflict of law principles. The parties hereby irrevocably consent to the jurisdi ction of the state and federal courts located in Los Angeles, California in any action arising out of or relating to this Agreement, and waive any other venue to which either party may be entitled by domicile-or otherwise. IS. Attorneys Fees. If any action at law or in equity is brought to enforce or interpret the provisions of this Agreement, the prevailing party in such action shall be awarded its reasonable attorneys fees and costs incurred, 16. Counterparts and Jg This Agreement may be signed in counterparts, which together shall constitute one agreement. The person signing on behalf of Recipient represents that he or she has the right and power to execute this Agreem ent. I 7. Leg& Effect. This agreement binds the Parties only with respec t to the matters expressly set forth herein. As such, unless and until a subsequent definitive written agreement regarding a Transaction has been executed, (a) Recipient will be under no legal obligation of any kind whatsoever to negotiate or consummate a Transa ction, and (b) Recipient shall have no claim whatsoever against Double Eagle or any of its directors, officers, owners, affiliates or representatives arising out ofor relating to any Transa ction or Confidential Information. IS. Entire Agreement, This Agreement expresses the full and complete understanding of the parties with respect to the subjec t matter hereof and supersedes all prior or contemporaneous proposals agreements, represe ntations and understandings, whether written or oral, with respect to the subject matter hereof. This Agreement is not to be construed, however, to limit any rights that Discloser may have under trade secret, copyright,

ln,

patent or other laws that may be available to Discloser. This Agreement may not be amended or modi fled except in writing signed by each of the parties hereto. The headings hereof are descriptive only and not to be construed in interpreting the provisions hereof. Date: December_, 2009
ACKNOWLEDGED, UNDERSTOOD & AGREED: AF DOUBLE EAGLE, ENC.

.-. .

By:
Aidan Foley, CEO

RECIPfENT:

1/

By.____

Name:

ikL. t1

Its:_____________

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