Note 8 - Commitments and Contingencies and Litigation
|6 Months Ended|
Jun. 30, 2018
|Notes to Financial Statements|
|Commitments and Contingencies Disclosure [Text Block]||
From time to time in the ordinary course of its business, the Company
maybe involved in legal proceedings, the outcomes of which
notbe determinable. The results of litigation are inherently unpredictable. Any claims against the Company, whether meritorious or
not,could be time consuming, result in costly litigation, require significant amounts of management time and result in diversion of significant resources. The Company is
notable to estimate an aggregate amount or range of reasonably possible losses for those legal matters for which losses are
notprobable and estimable, primarily for the following reasons: (i) many of the relevant legal proceedings are in preliminary stages and, until such proceedings develop further, there is often uncertainty regarding the relevant facts and circumstances at issue and potential liability; and (ii) many of these proceedings involve matters of which the outcomes are inherently difficult to predict. The Company has insurance policies covering potential losses where such coverage is cost effective.
January 29, 2018,the Company received notice that the U.S. District Court for the Central District of California (the “Court”) (Case
08295-ODW) issued an order dismissing, with prejudice, a putative class-active lawsuit against the Company. The dismissal relates to an action brought on
November 8, 2016by purported shareholders of the Company against the Company and
twoindividual defendants: Eric Steen, the Company’s former Chief Executive Officer, President and Director; and Jonathan Foster, the Company’s former Chief Financial Officer. The complaint asserted claims against all defendants under the antifraud provisions of the federal securities laws and against Messrs. Steen and Foster as control persons. On
June 19, 2017,the Company and all defendants filed a Motion to Dismiss the amended complaint. On
December 15, 2017,the Court dismissed the plaintiffs’
firstamendment to the class action compliant (“FAC”), with leave to amend. On
December 20, 2017,the parties stipulated, and the Court extended, the plaintiffs’ time to amend the FAC up to
January 19, 2018.As of
January 19, 2018,the plaintiffs never filed an amended complaint and the Court dismissed the lawsuit with prejudice on
January 29, 2018.On
February 28, 2018,the plaintiffs filed a notice of appeal, on the motion to dismiss, to the
9thCircuit Court of Appeals. On
June 4, 2018,the Company and the plaintiffs entered into a confidential settlement agreement resolving claims made in the litigation.
The Company is
notinvolved in any legal proceedings that the Company believes could have a material effect on the Company’s financial condition, results of operations or cash flows at this time.
The entire disclosure for commitments and contingencies.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef