Commitments and Contingencies	3 Months Ended
Mar. 31, 2021
Commitments and Contingencies
Commitments and Contingencies	Note 7.Commitments and Contingencies The Company records $7,500 a month for services rendered by Metropolitan on behalf of the Company. The Company incurred management fees of $22,500 for the periods ending March 31, 2021 and 2020. Mr. Gans is the sole owner of Metropolitan. The Company ceased leasing office space from the Westside Realty of New York which is owned and operated by Robert Gans, the Company’s majority shareholder, for $2,500 a month, effective January 1, 2021. The Company incurred rent expense of $-0- and $7,500 for the periods ending March 31, 2021 and 2020. On October 8, 2018, the Company was served with a Summons and Complaint in the action entitled Luisa Santos de Oliveira v. Scores Holding Company, Inc.; Club Azure, LLC; Robert Gans; Mark S. Yackow; Howard Rosenbluth, Docket No. 1:18-cv-06769-GBD, in the United States District Court of the Southern District. Plaintiff claims that the Defendants violated the minimum wage and overtime provisions of the Fair Labor Standards Act (“FLSA”); violated the New York Minimum Wage Act and the overtime provisions of the New York State Labor Law (“NYLL”); violated the Spread of Hours Wage Order of the New York Commissioner of Labor; violated the Notice and Recordkeeping requirements of the NYLL; violated the wage statement provisions of the NYLL; recovery of equipment costs in violation of the FLSA and NYLL; and unlawful deductions from tips in violation of the NYLL. Plaintiff brought this action as a class action and seeks certification of this action as a collective action on behalf of herself and all other similarly situated employees and former employees of Defendants. The Company has submitted an Answer to Plaintiff’s claims and the case is currently in the discovery phase. The Company, along with the Co-defendants, intends to vigorously defend itself against the claims asserted against it in this lawsuit. The likelihood of an unfavorable outcome is remote because the Company’s records show, inter alia, that the Plaintiff never worked more than 25 hours per week. The case was assigned to a Magistrate Judge. There was a conference on March 2, 2021 and a Scheduling Order was entered. On March 26, 2021, a Stipulation of Discontinuance was so-ordered by the Federal Court, discontinuing all claims against the Company. On September 14, 2018, the Company and its subsidiary SLC, filed an action against New 4125, LLC and Mike Taraska in the Supreme Court of the State of New York, County of New York. Defendants utilized the “Scores” name and trademark in connection with its ownership and operation of an adult entertainment club located in Phoenix, Arizona. In this action, the Company sought damages for breach of contract in the amount of $47,500. Defendants filed an Answer to the Complaint but it was not submitted by an attorney notwithstanding the fact that corporations must be represented by counsel. A motion to vacate the Answer based on the fact that the corporate defendant is not represented by counsel is pending. We are currently pursuing both the corporation and the individual defendant. On September 5, 2019, the Company together with its subsidiary SLC filed a civil action in Supreme Court of New York, New York County against Scores Alabama. A cease and desist letter was sent. The Company finally entered into a license agreement as of March 5, 2020 with Cheetah Club, LLC for a club located in Huntsville, Alabama. They agreed to pay the arrears and then cease using the Scores brand by March 31, 2023. They have done neither and we are in the process of moving for a default judgment in Federal Court. It should be noted as outlined below the results of two separate events and their subsequent settlement agreements were offset against one another resulting in a third settlement agreement. First, effective February 28, 2017 (the “Effective Date”), the Company entered into separate Settlement Agreements (a “Royalty Settlement Agreement”) each with three licensees, IMO, Star Light and Swan (are sometimes referred to individually as a “Licensee” and collectively as the “Licensees”) controlled by Robert M. Gans, the Company’s President, Chief Executive Officer and a member of its Board of Directors. Pursuant to the Royalty Settlement Agreements, the Company forgave the repayment of a certain portion of unpaid, past-due royalties in return for the respective Licensees’ agreements to pay the remainder (the “Royalty Settlement Amount”) of the unpaid royalties, plus interest, to the Company. The Royalty Settlement Amount for each Licensee was represented by a promissory note. IMO, Star Light and Swan owed the Company an aggregate of $255,406, $75,000, and $50,000 respectively in full settlement of unpaid royalties and other fees (the “Royalty Amount”). The settlement amounts were payable pursuant to promissory notes in monthly installments commencing March 1, 2017, and bears simple interest at the rate of 4% per year. Robert M. Gans is a majority owner of the equity of each of the Licensees and guaranteed the payment of each Licensee’s obligations under each of the 3 Settlement Documents. The Licensees were not current with respect to their obligations under the Settlement Documents and the Company did not call upon Mr. Gans to honor his Guaranties. Second, on April 3, 2016, 50 individuals purporting to be professional models and/or actresses collectively, (the “Plaintiffs”) filed a civil suit in the United States District Court for the Southern District of New York against the Company, I.M. Operating, LLC, The Executive Club, LLC, and Robert M. Gans, collectively the (the “Defendants”) alleging that images of Plaintiffs were used without their consent for commercial purposes on websites and social media outlets to promote gentlemen’s clubs operated by the Defendants or licensees of the Defendants (the “Lawsuit”) and (the “Voronina Matter). In July 2018, the Company entered into a confidential settlement agreement (the “Settlement Agreement”) in the Voronina litigation, and on August 4, 2018, the Court entered an order dismissing the plaintiff’s claims against the Defendants with prejudice and settled the Plaintiffs claims in the Voronina matter for $1,310,000 (the “Voronina Settlement Agreement”). See Note 7 for additional information. The Company had insufficient liquid resources to enable it to make a portion of the settlement payments called for by the Voronina Settlement Agreement. Metropolitan, made loans to the Company in the aggregate amount of $770,000 to enable the Company to make the payments under the Voronina Settlement Agreement. On December 1, 2018, the balance due Metropolitan inclusive of interest was $781,399.00. Third, the past due amounts including principal and interest under the Royalty Settlement Agreements were $382,259 as of December 1, 2018. On this date the Company entered into an agreement (the “Settlement and Offset Agreement”) to offset the Royalty Amount owed to the Company against the Voronina Amount owed to Metropolitan, thereby reducing the amount owed by the Company to Metropolitan to $399,139 (the “Net Voronina Amount”) pursuant to the terms of a Settlement and Offset Agreement made by and among the Company, Star Light, Swan, Metropolitan and Robert M. Gans. The Net Voronina Amount is payable pursuant to a promissory note (the “Voronina Note”), which bears simple interest at the rate of 4% per annum, in 86 consecutive monthly installments of $5,000 and a final installment of $1,370, with the initial installment due and payable on February 1, 2022 (or the first business day thereafter). The Company may prepay the Voronina Note at any time, in whole or in part without premium or penalty. The Offset Agreement also provides for the immediate termination of the Royalty Settlement Agreements and the related promissory notes and guarantees. On March 28, 2022 the entire balance due of the Voronina Note in the amount of $373,068.40 was paid in full. On January 29, 2020, an individual referred to as Jane Doe, the Plaintiff, filed a civil suit in in the Circuit Court of the 13^th Judicial Circuit, in the State of Florida, Hillsborough County, against the Company, its subsidiary, Scores Licensing Corp. (“SLC”), and several other defendants. Plaintiff’s Complaint details the somber circumstances surround the illegal actions of a non-party, who pled guilty to certain crimes against Plaintiff that were committed at a club known as Scores Tampa. Plaintiff now seeks to hold the Company and its subsidiary, among other defendants, liable in connection with the non-party’s illegal activity by asserting causes of action for negligence, vicarious liability and unjust enrichment. Initially, prior counsel moved to dismiss Plaintiff’s Complaint in lieu of filing Answers. A motion to dismiss was submitted because the Court lacks personal jurisdiction under Florida’s Long-Arm Statute and Due Process Requirements because neither the Company or its subsidiary had minimum contacts with Florida; nor was their a benefited conferred upon them. The Court denied the motion to dismiss, and Scores Holding and Scores Licensing have filed Amended answers and Affirmative Defenses denying all allegations of the complaints against them asserting legal defenses to liability. The case is now in the deposition stages of discovery. Discovery deadline is October 14, 2022, except for expert disclosures, which are to be completed by December 27, 2022. The Deadline for dispositive motions is February 11, 2023. Deadline for a CME of Plaintiff is February 12, 2023. The deadline for completion of expert discovery is March 15, 2023. The mediation deadline is April 14, 2023. The trial is set for July 24, 2023, with pretrial conference set for July 18, 2023. On July 15, 2019, plaintiff Jeremy Green, a former consultant to Swan Media Group, Inc (“SMG”), commenced an action in U.S. District Court, Southern District of New York against Scores Holding Co., Inc., Scores Media Group LLC, Scores Digital Gaming LLC (“SDG”) and individual defendants Robert Gans and Charilaos Yioves seeking to recover from all defendants under various theories of breach of contract, unjust enrichment, promissory estoppels, fraudulent inducement and breach of implied duty of good faith and fair dealing. On October 6, 2022 to avoid expense, inconvenience, and uncertainty of further litigation, the Company has agreed to settle this matter for $10,000. Greene will receive the settlement sum in two payments of $5,000 each. The first settlement payment will be made upon execution of the settlement agreement and the second payment will be due thirty days after the first payment. On April 17, 2021, in an action entitled Jessica Hall v. Scores Holding Company, Inc., et al, filed in Federal Court, Southern District, the Plaintiff claims that, while she worked at a gentlemen’s club located in New York, New York and commonly known as Scores NY, she was discriminated and retaliated against because of her race in violation of both Federal and State law. A motion for default judgment was denied, and Plaintiff was recently granted permission to file and serve an Amended Complaint. Accordingly on February 4, 2022 a First Amendment Complaint was filed. On March 4, 2022 an Answer to the First Amendment Complaint was filed On March 18, 2022 the Defendants filed A First Demand for Interrogatories Upon the Defendant. We have made demands for discovery from the Plaintiff and motioned for summary judgement seeking dismissal of all claims, which is pending. The likelihood of success on the merits is negligible because the Company, as simply the owner of the “Scores” brand and trademarks, did not own, operate or otherwise control Scores NY or employ, manage, or otherwise control Plaintiff’s employment during the period October 23, 2009 until September 18, 2019. Towards that end, a motion for summary judgment was fully submitted on behalf of the Company on June 24, 2022. We await the Court’s decision. In the meantime, discovery is ongoing. There are no other material legal proceedings pending to which the Company or any of its property is subject, nor to the Company’s knowledge are any such proceedings threatened.

Commitments and Contingencies

3 Months Ended

Mar. 31, 2021

Note 7.Commitments and Contingencies

The Company records $7,500 a month for services rendered by Metropolitan on behalf of the Company. The Company incurred management fees of $22,500 for the periods ending March 31, 2021 and 2020. Mr. Gans is the sole owner of Metropolitan.

The Company ceased leasing office space from the Westside Realty of New York which is owned and operated by Robert Gans, the Company’s majority shareholder, for $2,500 a month, effective January 1, 2021. The Company incurred rent expense of $-0- and $7,500 for the periods ending March 31, 2021 and 2020.

On October 8, 2018, the Company was served with a Summons and Complaint in the action entitled Luisa Santos de Oliveira v. Scores Holding Company, Inc.; Club Azure, LLC; Robert Gans; Mark S. Yackow; Howard Rosenbluth, Docket No. 1:18-cv-06769-GBD, in the United States District Court of the Southern District. Plaintiff claims that the Defendants violated the minimum wage and overtime provisions of the Fair Labor Standards Act (“FLSA”); violated the New York Minimum Wage Act and the overtime provisions of the New York State Labor Law (“NYLL”); violated the Spread of Hours Wage Order of the New York Commissioner of Labor; violated the Notice and Recordkeeping requirements of the NYLL; violated the wage statement provisions of the NYLL; recovery of equipment costs in violation of the FLSA and NYLL; and unlawful deductions from tips in violation of the NYLL. Plaintiff brought this action as a class action and seeks certification of this action as a collective action on behalf of herself and all other similarly situated employees and former employees of Defendants. The Company has submitted an Answer to Plaintiff’s claims and the case is currently in the discovery phase. The Company, along with the Co-defendants, intends to vigorously defend itself against the claims asserted against it in this lawsuit. The likelihood of an unfavorable outcome is remote because the Company’s records

show, inter alia, that the Plaintiff never worked more than 25 hours per week. The case was assigned to a Magistrate Judge. There was a conference on March 2, 2021 and a Scheduling Order was entered. On March 26, 2021, a Stipulation of Discontinuance was so-ordered by the Federal Court, discontinuing all claims against the Company.

On September 14, 2018, the Company and its subsidiary SLC, filed an action against New 4125, LLC and Mike Taraska in the Supreme Court of the State of New York, County of New York. Defendants utilized the “Scores” name and trademark in connection with its ownership and operation of an adult entertainment club located in Phoenix, Arizona. In this action, the Company sought damages for breach of contract in the amount of $47,500. Defendants filed an Answer to the Complaint but it was not submitted by an attorney notwithstanding the fact that corporations must be represented by counsel. A motion to vacate the Answer based on the fact that the corporate defendant is not represented by counsel is pending. We are currently pursuing both the corporation and the individual defendant.

On September 5, 2019, the Company together with its subsidiary SLC filed a civil action in Supreme Court of New York, New York County against Scores Alabama. A cease and desist letter was sent. The Company finally entered into a license agreement as of March 5, 2020 with Cheetah Club, LLC for a club located in Huntsville, Alabama. They agreed to pay the arrears and then cease using the Scores brand by March 31, 2023. They have done neither and we are in the process of moving for a default judgment in Federal Court.

It should be noted as outlined below the results of two separate events and their subsequent settlement agreements were offset against one another resulting in a third settlement agreement.

First, effective February 28, 2017 (the “Effective Date”), the Company entered into separate Settlement Agreements (a “Royalty Settlement Agreement”) each with three licensees, IMO, Star Light and Swan (are sometimes referred to individually as a “Licensee” and collectively as the “Licensees”) controlled by Robert M. Gans, the Company’s President, Chief Executive Officer and a member of its Board of Directors. Pursuant to the Royalty Settlement Agreements, the Company forgave the repayment of a certain portion of unpaid, past-due royalties in return for the respective Licensees’ agreements to pay the remainder (the “Royalty Settlement Amount”) of the unpaid royalties, plus interest, to the Company. The Royalty Settlement Amount for each Licensee was represented by a promissory note.

IMO, Star Light and Swan owed the Company an aggregate of $255,406, $75,000, and $50,000 respectively in full settlement of unpaid royalties and other fees (the “Royalty Amount”). The settlement amounts were payable pursuant to promissory notes in monthly installments commencing March 1, 2017, and bears simple interest at the rate of 4% per year.

Robert M. Gans is a majority owner of the equity of each of the Licensees and guaranteed the payment of each Licensee’s obligations under each of the 3 Settlement Documents. The Licensees were not current with respect to their obligations under the Settlement Documents and the Company did not call upon Mr. Gans to honor his Guaranties.

Second, on April 3, 2016, 50 individuals purporting to be professional models and/or actresses collectively, (the “Plaintiffs”) filed a civil suit in the United States District Court for the Southern District of New York against the Company, I.M. Operating, LLC, The Executive Club, LLC, and Robert M. Gans, collectively the (the “Defendants”) alleging that images of Plaintiffs were used without their consent for commercial purposes on websites and social media outlets to promote gentlemen’s clubs operated by the Defendants or licensees of the Defendants (the “Lawsuit”) and (the “Voronina Matter).

In July 2018, the Company entered into a confidential settlement agreement (the “Settlement Agreement”) in the Voronina litigation, and on August 4, 2018, the Court entered an order dismissing the plaintiff’s claims against the Defendants with prejudice and settled the Plaintiffs claims in the Voronina matter for $1,310,000 (the “Voronina Settlement Agreement”). See Note 7 for additional information. The Company had insufficient liquid resources to enable it to make a portion of the settlement payments called for by the Voronina Settlement Agreement. Metropolitan, made loans to the Company in the aggregate amount of $770,000 to enable the Company to make the payments under the Voronina Settlement Agreement. On December 1, 2018, the balance due Metropolitan inclusive of interest was $781,399.00.

Third, the past due amounts including principal and interest under the Royalty Settlement Agreements were $382,259 as of December 1, 2018. On this date the Company entered into an agreement (the “Settlement and Offset Agreement”) to offset the Royalty Amount owed to the Company against the Voronina Amount owed to Metropolitan, thereby reducing the amount owed by the Company to Metropolitan to $399,139 (the “Net Voronina Amount”) pursuant to the terms of a Settlement and Offset Agreement made by and among the Company, Star Light, Swan, Metropolitan and Robert M. Gans. The Net Voronina Amount is payable pursuant to a promissory note (the “Voronina Note”), which bears simple interest at the rate of 4% per annum, in 86 consecutive monthly installments of $5,000 and a final installment of $1,370, with the initial installment due and payable on February 1, 2022 (or the first business day thereafter). The Company may prepay the Voronina Note at any time, in whole or in part without premium or penalty. The Offset Agreement also provides for the immediate termination of the Royalty Settlement Agreements and the related promissory notes and guarantees. On March 28, 2022 the entire balance due of the Voronina Note in the amount of $373,068.40 was paid in full.

On January 29, 2020, an individual referred to as Jane Doe, the Plaintiff, filed a civil suit in in the Circuit Court of the 13^th Judicial Circuit, in the State of Florida, Hillsborough County, against the Company, its subsidiary, Scores Licensing Corp. (“SLC”), and several other defendants. Plaintiff’s Complaint details the somber circumstances surround the illegal actions of a non-party, who pled guilty to certain crimes against Plaintiff that were committed at a club known as Scores Tampa. Plaintiff now seeks to hold the Company and its subsidiary, among other defendants, liable in connection with the non-party’s illegal activity by asserting causes of action for negligence, vicarious liability and unjust enrichment. Initially, prior counsel moved to dismiss Plaintiff’s Complaint in lieu of filing Answers. A motion to dismiss was submitted because the Court lacks personal jurisdiction under Florida’s Long-Arm Statute and Due Process Requirements because neither the Company or its subsidiary had minimum contacts with Florida; nor was their a benefited conferred upon them.

The Court denied the motion to dismiss, and Scores Holding and Scores Licensing have filed Amended answers and Affirmative Defenses denying all allegations of the complaints against them asserting legal defenses to liability. The case is now in the deposition stages of discovery. Discovery deadline is October 14, 2022, except for expert disclosures, which are to be completed by December 27, 2022. The Deadline for dispositive motions is February 11, 2023. Deadline for a CME of Plaintiff is February 12, 2023. The deadline for completion of expert discovery is March 15, 2023. The mediation deadline is April 14, 2023. The trial is set for July 24, 2023, with pretrial conference set for July 18, 2023.

On July 15, 2019, plaintiff Jeremy Green, a former consultant to Swan Media Group, Inc (“SMG”), commenced an action in U.S. District Court, Southern District of New York against Scores Holding Co., Inc., Scores Media Group LLC, Scores Digital Gaming LLC (“SDG”) and individual defendants Robert Gans and Charilaos Yioves seeking to recover from all defendants under various theories of breach of contract, unjust enrichment, promissory estoppels, fraudulent inducement and breach of implied duty of good faith and fair dealing.

On October 6, 2022 to avoid expense, inconvenience, and uncertainty of further litigation, the Company has agreed to settle this matter for $10,000. Greene will receive the settlement sum in two payments of $5,000 each. The first settlement payment will be made upon execution of the settlement agreement and the second payment will be due thirty days after the first payment.

On April 17, 2021, in an action entitled Jessica Hall v. Scores Holding Company, Inc., et al, filed in Federal Court, Southern District, the Plaintiff claims that, while she worked at a gentlemen’s club located in New York, New York and commonly known as Scores NY, she was discriminated and retaliated against because of her race in violation of both Federal and State law. A motion for default judgment was denied, and Plaintiff was recently granted permission to file and serve an Amended Complaint. Accordingly on February 4, 2022 a First Amendment Complaint was filed. On March 4, 2022 an Answer to the First Amendment Complaint was filed On March 18, 2022 the Defendants filed A First Demand for Interrogatories Upon the Defendant. We have made demands for discovery from the Plaintiff and motioned for summary judgement seeking dismissal of all claims, which is pending. The likelihood of success on the merits is negligible because the Company, as simply the owner of the “Scores” brand and trademarks, did not own, operate or otherwise control Scores NY or employ, manage, or otherwise control Plaintiff’s employment during the period October 23, 2009 until September

18, 2019. Towards that end, a motion for summary judgment was fully submitted on behalf of the Company on June 24, 2022. We await the Court’s decision. In the meantime, discovery is ongoing.

There are no other material legal proceedings pending to which the Company or any of its property is subject, nor to the Company’s knowledge are any such proceedings threatened.