Company: IPSI
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001213900-25-026455
Chunk: 500

Company: Innovative Payment Solutions, Inc.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1C
Chunk 500
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 directors with the Occupational Safety and Health Administration
of the United States Department of Labor (“OSHA”), captioned Naum Voloshin, Yulia Rey, Alexander Voloshin, Andrey Novikov,
and Frank Perez v. Innovative Payment Solutions, Inc., William Corbett, Richard Rosenblum, Madisson Corbett, Jim Fuller, Cliff Henry
and David Rios. The complaint generally alleged that complainants, four former employees (or independent consultants) of our Company
and one employee who was on suspension, did not receive compensation to which they claim they were entitled and that they were wrongfully
terminated for engaging in protected activities in violation of the Sarbanes-Oxley Act of 2002, 18 U.S.C. § 1514A. The complaint
sought reinstatement of complainants’ employment, monetary damages including back pay, raises, bonuses, benefits, overtime, emotional
distress and loss of reputation, orders of abatement and injunctive relief, and costs of litigation.

In early 2022, OSHA
dismissed the claims of Ms. Rey and Mr. Perez, and they appealed that decision. Prior counsel moved to dismiss the remaining claims and
as of this writing OSHA took no action with respect to that motion as ultimately the former employees elected to proceed in federal court.
Pursuant to agreement and stipulation, dismissal of the OSHA claims was accomplished without prejudice on November 10, 2022.

On November 7, 2022,
the same five employees filed a lawsuit, not in federal court, but in the California Superior Court for the County of Los Angeles, against
our Company and the same individuals against whom they had asserted their OSHA claim. The complaint asserted claims for, among other
things, breach of contract, failure to pay wages and failure to reimburse expenses under the California Labor Code and asserting retaliation
claims under the California Labor Code. On December 16, 2022, the same five employees filed an amended complaint dropping all defendants
from the case except Mr. Corbett and our Company. The amended complaint asserts claims for violations of California Labor Code Section
1102.5; wrongful termination in violation of public policy; breach of contract; breach of covenant of good faith and fair dealing; violation
of California Labor Code Section 201; waiting time penalties (Cal. Lab. Code Sections 201 & 203) and violation of California Labor
Code Section 2802.

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We and Mr.