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Commitments and Contingencies
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9 Months Ended |
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Sep. 30, 2014
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| Commitments and Contingencies Disclosure [Abstract] | |
| Commitments and Contingencies | NOTE 12. Commitments and Contingencies Viamport Litigation On May 22, 2012, a lawsuit was filed against the Company in Santo Domingo, Dominican Republic (Case No. FP-12-461) by Viaimport, SRL, a former customer of the Company, and served on the Company on July 12, 2012. The complaint alleged breach of contract and sought U.S. $1 million in damages. On August 31, 2012, the Company filed a lawsuit against Viaimport and its principal, Omar Hassan, in the Circuit Court of the Eleventh Judicial Circuit in and for Miami-Dade County Florida (Case No. 12-34647CA32) for non-payment of purchase obligations aggregating $288,559 and other damages. On August 12, 2013, Viaimport filed a counterclaim against InfoSonics in Miami-Dade County, which was essentially a mirror image of the Dominican Republic complaint. On November 19, 2013, InfoSonics filed a request with the Dominican Republic Court to request dismissal of the case there for lack of jurisdiction in order to have both related actions heard in Miami-Dade County. On June 30, 2014 we entered into a Settlement Agreement with Viaimport and Hassan whereby Viaimport and Hassan, jointly and severally, agreed to pay us $125,000 consisting of an immediate payment of $45,000 and the $80,000 balance in six equal monthly payments. Prior to the settlement, the related account receivable was fully reserved. As a result of the settlement and the $45,000 payment at closing, $208,559 of the reserve was applied to reduce the receivable to $80,000. We are now recording the monthly payments as bad debt recoveries when received. The lawsuits in Miami and the Dominican Republic have been dismissed with prejudice by the Courts. Blue Spike Litigation On October 8, 2013, Blue Spike, LLC (“Blue Spike”) filed a patent infringement lawsuit against the Company in the U.S. District Court for the Eastern District of Texas, alleging that certain of our products infringe claims of U.S. Patent No. 5,745,569. Blue Spike is seeking recovery of unspecified monetary damages. We do not believe we infringe the Blue Spike patent and intend to defend ourselves vigorously. On February 10, 2014 we filed an answer with the Court stating that we do not infringe and setting forth multiple defenses. Due to the inherent uncertainty of litigation, we cannot identify probable or estimable damages related to the lawsuit at this time. The Company may become involved in certain other legal proceedings and claims which arise in the normal course of business. Other than as described above, as of the filing date of this report, the Company did not have any significant litigation outstanding. |