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`UNITED STATES DISTRICT COURT
`SOUTHERN DISTRICT OF NEW YORK
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`ROYAL NEWS CORP. d/b/a ROYAL MEDIA GROUP,
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`Plaintiff,
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`v.
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`NETSOL TECHNOLOGIES, INC.,
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`Defendant.
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`Case No.:
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`COMPLAINT
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`(JURY TRIAL DEMANDED)
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`Plaintiff Royal News Corp. d/b/a Royal Media Group (“RMG” or “Plaintiff”) for its
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`Complaint against Defendant NETSOL Technologies, Inc. (“NETSOL” or “Defendant”), alleges
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`as follows:
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`PARTIES
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`1.
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`Plaintiff RMG is a New York corporation with its principal place of business in
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`New York, New York.
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`2.
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`Upon information and belief, Defendant NETSOL is a Nevada corporation with
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`its principal place of business in Calabasas, California.
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`JURISDICTION AND VENUE
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`3.
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`This Court has jurisdiction over this matter pursuant to 28 U.S.C. § 1332(a), as
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`the matter in controversy exceeds the sum of $75,000 exclusive of interest and costs and is
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`between citizens of different states.
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`4.
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`Venue is proper in this District pursuant to 28 U.S.C. § 1391(b)(2) because a
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`substantial part of the events or omissions giving rise to the claims occurred within the Southern
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`District of New York.
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`{00422280.DOCX; 1}
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`Case 1:20-cv-05381 Document 1 Filed 07/13/20 Page 2 of 8
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`5.
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`This Court has personal jurisdiction over Defendant NETSOL because, among
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`other things, NETSOL (i) transacted business in New York; (ii) regularly does and solicits
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`business and derives substantial revenue from services rendered in New York; and (iii) despite
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`deriving substantial revenue from services rendered in New York, committed tortious acts
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`outside of New York causing injury to person or property within New York.
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`FACTUAL BACKGROUND
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`6.
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`RMG is a business information and media company serving professionals in the
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`financial services, air freight, and vehicle finance sectors. RMG, among other things, organizes
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`and runs business conferences, including two annual conferences held for the automotive finance
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`industry: the “Auto Finance Accelerate” (the “Accelerate”) conference, typically held in March,
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`and the “Auto Finance Summit,” (the “Summit”) typically held in October. RMG also publishes
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`the premier monthly magazine for the automotive finance industry, which is distributed to 1,211
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`paid subscribers, and disseminated as an email a daily automotive finance industry newsletter to
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`approximately 5,200 subscribers.
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`7.
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`Upon information and belief, NETSOL provides smart software technology and
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`consulting services to individuals and entities in the asset financing and leasing industries.
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`8.
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`On or about December 17, 2018, RMG and NETSOL entered into the Multi Year
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`Auto Finance Summit Agreement (the “Sponsorship Agreement”), pursuant to which NETSOL
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`agreed to pay Sponsorship Fees to RMG in return for designation as the sole “Diamond Level
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`Sponsor” for the Accelerate and Summit conferences for a period of five (5) years (2019-2023).
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`The Sponsorship Agreement is attached as Exhibit 1.
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`9.
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`Pursuant to § 1(c) of the Sponsorship Agreement, NETSOL would pay $139,723
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`per year beginning in 2019 and continuing through 2023. The total amounts owed annually in
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`{00422280.DOCX; 1}
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`Case 1:20-cv-05381 Document 1 Filed 07/13/20 Page 3 of 8
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`2020, 2021, 2022, and 2023 would be paid in four (4) equal installments of $34,930.75 due on
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`January 2, March 1, May 1, and July 1 of each year.
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`10.
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`The Sponsorship Agreement provides that “Failure to make any scheduled
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`payments [required under § 1(c)] shall be deemed a cancellation.” (Sponsorship Agreement, §
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`1(c))
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`11.
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`Section 1(d) of the Sponsorship Agreement provides that “In the event of a
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`cancellation of this Agreement by NETSOL, NETSOL shall, within ten (10) days of such
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`cancellation, pay to Royal Media a termination fee[.]”
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`12.
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`Section 1(d) of the Sponsorship Agreement also provides that, should NETSOL
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`cancel the Sponsorship Agreement due to a payment breach between January 1 and December
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`31, 2020, it must pay RMG a termination fee of “$139,723 + $62,875.35 (15% of the total
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`remaining balance for 2021, 2022, and 2023).” Pursuant to its terms, NETSOL would owe RMG
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`$202,598.35 if it terminated the Sponsorship Agreement in calendar year 2020.
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`13.
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`The parties agreed that the termination fees “constitute reasonable estimates of
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`Royal Media’s actual harm due to the cancellation or default, in the form of agreed-upon
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`liquidated damages and not as a penalty.” (Sponsorship Agreement, § 1(d) (emphasis in the
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`original))
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`14.
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`Pursuant to § 1(e) of the Sponsorship Agreement, NETSOL also agreed to comply
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`with RMG’s Exhibitor-Sponsor Terms and Conditions (the “T&C”). The Sponsorship
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`Agreement incorporates the “T&C,” which are attached as Exhibit 2.
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`15.
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`Under the “Payments” section of the T&C, NETSOL was obligated to “send a
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`full, non-refundable payment… to reserve Exhibit and/or Sponsorship rights at the Show.” A
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`failure to do so resulted in a breach of the T&C.
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`{00422280.DOCX; 1}
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`Case 1:20-cv-05381 Document 1 Filed 07/13/20 Page 4 of 8
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`16.
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`In the “Indemnification” section of the T&C, NETSOL consented to pay RMG’s
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`attorneys’ fees and costs arising out of any breach of the T&C.
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`17.
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`Notwithstanding the terms of the Sponsorship Agreement, NETSOL failed to pay
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`the $34,930.75 due on or before March 1, 2020.
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`18.
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`By early March 2020, RMG had honored all its contractual commitments for the
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`2020 Accelerate conference (the “2020 Conference”) and had registered 201 attendees for the
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`Conference.
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`19.
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`The 2020 Conference was held on March 9-11, 2020. NETSOL attended as the
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`Diamond Level Sponsor.
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`20.
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`As a Diamond Level Sponsor, NETSOL received, inter alia, premium
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`advertisement placement on various Accelerate and Summit platforms and merchandise,
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`complimentary conference registrations, a premium booth in the Exhibition Hall at both events, a
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`one-month banner advertisement on AutoFinanceNews.net, and the attendee contact lists.
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`(Sponsorship Agreement, § 1). NETSOL received each Accelerate benefit at the 2020
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`Conference as its Diamond Level Sponsor.
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`21.
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` Many of the attendees visited the NETSOL exhibitions and met with NETSOL
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`representatives during the Conference.
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`22.
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`On March 16, 2020, NETSOL notified RMG by email that it would not comply
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`with its contractual obligations under the Sponsorship Agreement, notwithstanding its
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`participation in and sponsorship of the 2020 Conference.
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`23.
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`On March 18, 2020, RMG invited NETSOL to discuss its March 16 email and
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`reach an amicable resolution given their long-standing business relationship. NETSOL did not
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`respond to RMG’s request to discuss the matter.
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`{00422280.DOCX; 1}
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`Case 1:20-cv-05381 Document 1 Filed 07/13/20 Page 5 of 8
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`24.
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`By letter dated April 7, 2020 (attached as Exhibit 3), RMG informed NETSOL
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`that its actions constituted a cancellation of the Sponsorship Agreement under § 1(c) and
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`triggered its obligation to pay RMG the $202,598.35 termination fee under § 1(d). In light of
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`NETSOL’s cancellation of the Sponsorship Agreement and its failure to respond to RMG’s
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`earlier correspondence regarding NETSOL’s defaults, RMG demanded that NETSOL pay in full
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`the termination fee.
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`25.
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`Notwithstanding its April 7 letter, by letter dated April 29, 2020 (attached as
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`Exhibit 4), RMG invited NETSOL to discuss how it would settle its obligation to pay the
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`termination fee and RMG’s attorneys’ fees owed pursuant to the Sponsorship Agreement.
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`Moreover, despite NETSOL’s breach of the Sponsorship Agreement, RMG told NETSOL that it
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`could have until five (5) days after California lifted its applicable shelter in place orders to make
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`an appropriate proposal to satisfy its obligations to RMG.
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`26.
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`Despite RMG’s good faith efforts, when California lifted in part its shelter in
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`place orders on May 8, 2020, and allowed businesses to return to their offices, NETSOL did not
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`contact RMG or provide RMG with any proposal to satisfy its obligations under the Sponsorship
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`Agreement, including its duty to pay the termination fee and RMG’s attorneys’ fees.
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`27.
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`By letter dated June 29, 2020 (attached as Exhibit 5), RMG demanded that
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`NETSOL immediately pay the full $202,598.35 termination fee plus $10,000 in attorneys’ fees
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`and costs for its wrongful termination of the Sponsorship Agreement.
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`28.
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`By letter dated July 2, 2020 (attached as Exhibit 6), NETSOL refused to pay the
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`termination fee to RMG.
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`{00422280.DOCX; 1}
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`Case 1:20-cv-05381 Document 1 Filed 07/13/20 Page 6 of 8
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`29.
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`To date, NETSOL has not paid the $202,598.35 termination fee or the
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`contractually mandated attorneys’ fees and costs currently owed to RMG pursuant to the
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`Sponsorship Agreement and the T&C.
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`CLAIMS FOR RELIEF
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`FIRST CLAIM FOR RELIEF
`(BREACH OF CONTRACT)
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`Plaintiff repeats each of the foregoing allegations as if fully set forth herein.
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`On or about December 17, 2018, RMG and NETSOL entered into the
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`30.
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`31.
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`Sponsorship Agreement.
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`32.
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`33.
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`RMG performed all its obligations under the Sponsorship Agreement.
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`NETSOL breached the Sponsorship Agreement by failing to pay (i) the amount
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`owed pursuant to § 1(c) on or before March 1, 2020; and (ii) the termination fee owed under §
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`1(d) after defaulting on its obligations and cancelling the Agreement.
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`34.
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`By defaulting on the payments owed pursuant to the Sponsorship Agreement,
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`NETSOL also breached the T&C incorporated into the Sponsorship Agreement.
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`35.
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`As a result of NETSOL’s breach of the Sponsorship Agreement, RMG has
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`incurred $202,598.35 in damages plus its attorneys’ fees and costs.
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`36.
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`Pursuant to the Sponsorship Agreement, NETSOL must pay RMG the
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`$202,598.35 termination fee and reimburse RMG for its attorneys’ fees and costs incurred and to
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`be incurred in prosecuting this action.
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`SECOND CLAIM FOR RELIEF
`(QUANTUM MERUIT)
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`Plaintiff repeats each of the foregoing allegations as if fully set forth herein.
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`37.
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`{00422280.DOCX; 1}
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`Case 1:20-cv-05381 Document 1 Filed 07/13/20 Page 7 of 8
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`38.
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`RMG spent countless hours of time and effort organizing the 2020 Conference,
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`which allowed all attendees a chance to enhance their businesses through networking and
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`advertising.
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`39.
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`NETSOL attended the 2020 Conference, reaping the benefits of the event and
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`NETSOL’s spotlighted role as the only Diamond Level Sponsor, but failed to pay for its
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`attendance and sponsorship.
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`40.
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`Due to NETSOL’s cancellation of the Sponsorship Agreement, RMG had to find
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`a new Diamond Level Sponsor for the Accelerate and Summit conferences to be held through
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`2023, when the Sponsorship Agreement was set to expire.
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`41.
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`As a result of NETSOL’s actions, RMG has incurred damages in an amount to be
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`determined at trial, but no less than $202,598.35.
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`42.
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`NETSOL is liable to RMG for all its damages that resulted from NETSOL’s
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`wrongful acts.
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`WHEREFORE, Plaintiff respectfully requests that this Court enter judgment in its favor
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`and against Defendant as follows:
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`(A) On the First Cause of Action, for breach of contract, in the amount of
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`$202,598.35, plus costs and pre-judgment and post-judgment interest;
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`(B) On the Second Cause of Action, for quantum meruit, in the amount of
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`$202,598.35, plus costs and pre-judgment and post-judgment interest;
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`(C)
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`(D)
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`For all attorneys’ fees incurred because of Defendant NETSOL’s breach; and
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`For such other and further relief as this Court may deem just and proper.
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`{00422280.DOCX; 1}
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`Case 1:20-cv-05381 Document 1 Filed 07/13/20 Page 8 of 8
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`Dated: July 13, 2020
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`New York, New York
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`COHEN TAUBER SPIEVACK & WAGNER P.C.
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`By:_______________________________________
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`Stephen Wagner
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`Jay Spievack
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`Caroline F. Corley
`420 Lexington Avenue, Suite 2400
`New York, New York 10170
`Tel.: (212) 586-5800
`swagner@ctswlaw.com
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`Counsel to Plaintiff
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`{00422280.DOCX; 1}
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