Business Context and Reporting Period
This Form 8-K Current Report was filed by My Size, Inc. on September 9, 2015. The filing discloses significant legal developments involving the Company, specifically the initiation of litigation regarding the 2011 acquisition of Metamorfix, Ltd.
Key Financial Metrics
The filing text does not provide a clear value for revenue, profit, cash flow, margins, debt, or liquidity. This report focuses exclusively on legal events and does not contain financial statement data.
Material Changes and Legal Actions
Delaware Chancery Court Lawsuit
On September 9, 2015, My Size, Inc. filed a Complaint (Case No. 11487-VCN) in the Chancery Court of the State of Delaware against 15 defendants, including former director Moshe Mizrahi and various investors.
- Causes of Action: Breach of contract, breach of fiduciary duty, fraud in the inducement, negligent misrepresentation, conspiracy to commit fraud, unjust enrichment, and breach of the implied covenant of good faith and fair dealing.
- Allegations: The claims arise from share issuances between June and December 2011 related to the Metamorfix, Ltd. acquisition. The Company alleges Mr. Mizrahi breached his fiduciary duty by failing to disclose material facts regarding the investment and prioritizing his own interests.
- Relief Sought: Equitable rescission, monetary damages, establishment of a constructive trust, and injunctive relief to prevent the sale of shares allegedly wrongfully obtained by the Defendants.
Related Israeli Legal Action
On the same date, a group of Israel-based shareholders, including many of the named Defendants, filed a related action in the Tel Aviv District Court (File No. 16746-09-15).
- Objective: Seeking a declaratory judgment to allow the sale of the subject shares on the Tel Aviv Stock Exchange.
- Claims: Seeking unspecified damages, including costs and attorneys' fees.
Guidance, Outlook, and Risks
The filing does not provide financial guidance or management commentary on future operations. The primary risk disclosed is the outcome of the pending litigation, which could result in monetary damages, the rescission of share issuances, or restrictions on the sale of shares by the Defendants.
Investor Verification Checklist
- Verify the current status of the Delaware Chancery Court case (Case No. 11487-VCN) and the Tel Aviv District Court case (File No. 16746-09-15).
- Assess the potential financial impact of the requested monetary damages and equitable rescission on the Company's capital structure.
- Review the Company's 2011 acquisition of Metamorfix, Ltd. to understand the underlying transaction disputes.
- Monitor for any subsequent filings regarding the sale of shares by the named Defendants on the Tel Aviv Stock Exchange.