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JURISDICTION AND VENUE

2. This Court has jurisdiction over this action 

under 28 U.S.C. § 1332 (a) (1). There is complete diversity of 

citizenship between the parties to this action and the amount in 

controversy exceeds $75,000, exclusive of interest and costs. 

3. This Court has jurisdiction over this action, 

which involves a dispute concerning a patent, under 28 U.S.C. § 

1338 (a). 

4. Venue is proper in this district under 28 U.S.C. 

§§ 1391 (a) (2), 1391 (a) (3), 1391 (b) (2), 1391 (b) (3), and 

pursuant to an agreement. 

5. Plaintiff Lawrence Obstfeld was a shareholder of 

Toev Medical Corporation at the time of the transactions 

complained of in this action and this action is not a collusive 

one to confer jurisdiction on a court of the United States which 

it would not otherwise have. 

PARTIES

6. Toev Medical Corporation (“Toev”) is a Delaware 

corporation. 

7. Lawrence Obstfeld (“Obstfeld”) is a shareholder 

of Toev. He resides in Brooklyn, New York. 

8. Ignition Ventures, Inc. (“Ignition”) is a 

Massachusetts corporation. 

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9. ThermopeutiX, Inc. (“ThermopeutiX”) is a Delaware 

corporation. 

10. Arthur Schwartz (“Schwartz”) was president and 

chief executive officer of Toev. Upon information and belief, 

Schwartz resides in New Jersey and is a director, officer, 

and/or shareholder of ThermopeutiX. 

11. Ronald Solar (“Solar”) is a medical device 

engineer who was chief executive officer of Toev. Upon 

information and belief, Solar resides in California and is an 

officer, director, and/or shareholder of ThermopeutiX. 

12. Upon information and belief, Renaissance 

Biomedical, Inc. (“Renaissance”) is a California corporation 

that was retained as a consultant to Toev. Upon information and 

belief, Solar is the sole shareholder of Renaissance. 

13. Upon information and belief, defendant Glen 

Lieber resides in California and is a former officer of Toev. 

Upon information and belief, he is and a shareholder, officer, 

director, and/or agent of ThermopeutiX. 

FACTS COMMON TO ALL CAUSES OF ACTION

14. Schwartz, an anesthesiologist and former 

professor at Columbia University, through years of research and 

study developed a seminal understanding of the challenge and 

obstacles to selectively cooling the brain, a putative treatment 

for the approximately 600,000 people per year who suffer 

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strokes, as well as a novel method of cooling the brain so as to 

mitigate the negative effects of stroke (“Brain Cooling 

Method”). Success of this method was reported by Schwartz in 

the article “Isolated Cerebral Hypothermia by Single Cartoid 

Artery Perfusion of Extracorporeally Cooled Blood in Baboons,” 

published in the journal Neurosurgery, 39(3):577 - 582, 

September 1996. 

15. In 2000, Toev was formed by Schwartz and Obstfeld 

for the purpose of developing and commercializing Schwartz’s 

Brain Cooling Method and related medical technologies. 

16. The original shareholders of Toev were Schwartz, 

Obstfeld, Dr. Joseph Gottesman (“Gottesman”), and Stanley 

Gewirtz (“Gewirtz”). 

17. The Brain Cooling Method and the related medical 

technologies that were being developed by Schwartz are the 

property of Toev. 

18. Due to Schwartz’s work on the Brain Cooling 

Method while a professor at Columbia University (“Columbia”), 

Columbia owned rights to certain method patents covering a 

limited component of the Brain Cooling Method (“Columbia 

Patents”). 

19. Though leaving Columbia for Mount Sinai Hospital, 

Schwartz believed that Toev needed to obtain a license from 

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Columbia for the Columbia Patents in order for him to further 

develop the Brain Cooling Method for Toev. 

20. On February 4, 2000, Obstfeld loaned Toev $50,000 

for the purpose of purchasing a license to the Columbia Patents 

(“Obstfeld Loan”). 

21. A promissory note concerning the Obstfeld Loan 

set forth a five year term of repayment and provided that Toev 

would pay attorneys’ fees and expenses of collection. 

22. On February 4, 2000, Columbia and Toev entered 

into a licensing agreement and a stock purchase agreement 

(“Stock Purchase Agreement”), whereby Toev obtained a license to 

use the Columbia Patents in exchange for $50,000 and 1,000 

shares of Toev stock. 

23. Additionally, as part of the Stock Purchase 

Agreement, it was agreed that: a) Toev intended to employ 

Schwartz; b) upon receipt of funding, Toev would compensate 

Obstfeld and Gewirtz $50,000 per annum for consulting services; 

c) Toev would engage Obstfeld as an employee; d) Toev would pay 

Obstfeld a fee of 1% of financing for the services he rendered 

to Toev as a registered representative; and e) Gewirtz and 

Obstfeld would provide Schwartz with proxies to vote their 

shares in Toev. 

24. Toev, Schwartz, Obstfeld, Gottesman, Columbia, 

and Gewirtz signed the Stock Purchase Agreement, which provides 

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that the agreement shall be governed by New York law and venued 

in the United States District Court for the Southern District of 

New York or courts of the State of New York located in the City 

and County of New York. 

25. Soon after Toev received the $50,000 from 

Obstfeld to purchase the license to the Columbia Patents, 

Schwartz froze Obstfeld out of Toev and refused to allow 

Obstfeld access to any Toev corporate information. 

26. In September 2000, Schwartz, who was then chief 

executive officer of Toev, announced that Solar, a catheter 

engineer, had agreed to serve as director of research and 

development of Toev. 

27. In December 2002, Toev entered into a contract 

with Ignition to provide start-up consulting to Toev and obtain 

funding for Toev in exchange for a retainer and 7% of the 

outstanding shares of Toev. 

28. Ignition performed all the work required under 

its contract with Toev, but was never paid its full retainer and 

did not receive shares of Toev in accordance with its agreement 

with Toev. 

29. In May 2003, Schwartz appointed Solar to the 

position of chief executive officer of Toev. 

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30. In May 2003, Glen Lieber (“Lieber”) was appointed 

president of Toev and vice-president of research and development 

of Toev. 

31. On or about August 18, 2003, Schwartz, the holder 

of the more than 70% of the shares of Toev, unilaterally 

established himself as the sole director of Toev. 

32. In September 2003, Toev entered into a consulting 

agreement with Renaissance Biomedical, Inc. (“Renaissance”), a 

company of which Solar was the sole shareholder. 

33. Under the consulting agreement with Renaissance, 

Renaissance agreed to assist Toev in the development and 

commercialization of the Brain Cooling Method and other related 

medical technologies and Toev agreed to pay Renaissance $25,000 

per month for a minimum of three months. 

34. In December 2003, Toev’s corporate charter in 

Delaware lapsed due to Toev’s failure to pay the applicable 

franchise taxes. 

35. In February 2004, Ignition advised Schwartz that 

several venture capital firms were interested in making 

investments in Toev. 

36. In May 2004, Solar refused to allow Toev to 

negotiate to accept funding sourced by Ignition. 

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37. Solar sent an e-mail, dated May 7, 2004, 

indicating that he had chosen not to renew his contract with 

Toev. 

38. On May 27, 2004, a corporate filing was made for 

ThermopeutiX, with Lieber being listed as its agent for the 

service of process. 

39. Upon information and belief, Schwartz, Solar, 

Lieber, and Renaissance are the founders of ThermopeutiX and are 

officers, directors, and/or shareholders of ThermopeutiX. 

40. Schwartz, Solar, Lieber, and Renaissance never 

disclosed their involvement in the formation of ThermopeutiX to 

any disinterested director or shareholder of Toev. 

41. Upon information and belief, Schwartz, Solar, 

Lieber, and Renaissance misappropriated the Brain Cooling Method 

and other related proprietary medical technologies from Toev for 

their own benefit and formed ThermopeutiX as a vehicle to profit 

from their misappropriation. 

42. Upon information and belief, Schwartz, Solar, 

Lieber, and Renaissance had begun to make arrangements for the 

formation of ThermopeutiX during the time that they owed duties 

of undivided loyalty to Toev and its shareholders. 

43. In a June 20, 2004 e-mail to Columbia, Schwartz, 

who was then an officer and the sole member of the board of 

directors of Toev, announced that, effective immediately, he was 

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relinquishing ownership of all of his shares of stock in Toev, 

assigning those shares to Toev, and resigning from his position 

as an officer and director of Toev. 

44. As the result of Schwartz’s purported resignation 

and abandonment of Toev, Toev was left without a board of 

directors. 

45. Upon information and belief, although Schwartz 

was the sole director of Toev and owned more than 70% of its 

stock, he made no effort to fill the vacancy left by his 

purported resignation as the sole director of Toev. 

46. Upon information and belief, Schwartz’s 

announcement of his purported resignation was directed to 

Columbia only, not to the other shareholders of Toev: Obstfeld, 

Gewirtz, and Gottesman. 

47. In a May 24, 2005 press release, Surmodics, Inc. 

(“Surmodics”), a leading provider of medical technologies to the 

healthcare industry, announced that it was investing $1 million 

in ThermopeutiX based upon the Brain Cooling Method and related 

medical technologies. 

48. Upon information and belief, ThermopeutiX also 

obtained significant additional funding based upon the Brain 

Cooling Method and related medical technologies. 

49. Schwartz, Solar, Lieber, and Renaissance never 

offered to Toev the opportunity to partake in the Surmodics 

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funding or any other funding concerning the Brain Cooling Method 

or any other related medical technologies that were being 

developed by Schwartz for Toev. 

50. Plaintiffs only learned of Schwartz and Solar’s 

involvement in ThermopeutiX by reading the Surmodics press 

release. 

51. Upon information and belief, ThermopeutiX has 

submitted an application for a patent for aspects of the Brain 

Cooling Method and other proprietary medical technologies that 

had been misappropriated from Toev by Schwartz, Solar, Lieber, 

and Renaissance. 

52. Schwartz was the sole member of the board of 

directors of Toev. Accordingly, the requirement that a demand 

be made to the Toev board of directors to commence an action to 

assert the claims that Obstfeld has asserted on behalf of Toev 

in this action should be excused on the basis of futility. 

AS AND FOR A FIRST CAUSE OF ACTION

(Breach of Fiduciary Duty) 

53. All allegations contained in the paragraphs above 

are incorporated by reference. 

54. Defendants Schwartz, Solar, Lieber, and 

Renaissance owed fiduciary duties to Toev. 

55. Defendants Schwartz, Solar, Lieber, and 

Renaissance breached the fiduciary duties they owed to Toev by, 

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among other things, usurping corporate opportunities in which 

Toev had an interest, forming ThermopeutiX for the purpose of 

benefiting from their misappropriation of the Brain Cooling 

Method and related medical technology that were the trade 

secrets and proprietary information of Toev, and using their 

positions as officers, directors, employees, shareholders, 

and/or consultants of Toev to engage in self-interested 

transactions and actions detrimental to the interests of Toev 

and its shareholders. 

56. As a consequence of Schwartz, Solar, Lieber, and 

Renaissance’s breaches of fiduciary duty, Toev has been damaged 

in an amount to be determined at trial, but believed to be not 

less than $20 million. 

57. Additionally, due to Schwartz, Solar, Lieber, and 

Renaissance’s breaches of fiduciary duty, all shares of stock 

and assets of ThermopeutiX should be deemed the property of Toev 

and placed in a constructive trust for the benefit of Toev, 

including any patents or the rights to any pending patents. 

58. All profits generated by Schwartz, Solar, Lieber, 

and Renaissance as the result of their breaches of fiduciary 

duty and all compensation paid to them during the time that they 

were disloyal to Toev should be disgorged to Toev. 

59. Plaintiffs also request the imposition of 

punitive damages against Schwartz, Solar, Lieber, and 

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Renaissance for their egregious conduct, including their 

reckless breaches of the fiduciary duties that they owed to Toev 

and its shareholders and their wholesale misappropriation of 

Toev’s proprietary information for their own benefit. 

AS AND FOR A SECOND CAUSE OF ACTION

(Breach of Fiduciary Duty) 

60. All allegations contained in the paragraphs above 

are incorporated by reference. 

61. As the result of Schwartz, Solar, Lieber, and 

Renaissance’s breaches of fiduciary duty, Toev has been unable 

to meet its obligations under the Obstfeld Loan. 

62. Consequently, Obstfeld has been damaged in an 

amount not less than $450,000 plus attorneys’ fees, interest, 

costs, and disbursements. 

63. Plaintiffs also request the imposition of 

punitive damages against Schwartz, Solar, Lieber, and 

Renaissance for their egregious conduct, including their 

reckless breaches of the fiduciary duties that they owed to Toev 

and its shareholders and their wholesale misappropriation of 

Toev’s proprietary information for their own benefit. 

AS AND FOR A THIRD CAUSE OF ACTION

(Tortious Interference with Contract) 

64. All allegations in the paragraphs above are 

incorporated by reference. 

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65. Schwartz, Solar, Lieber, and Renaissance were 

directors, officers, and consultants of Toev. 

66. Schwartz, Solar, Lieber, and Renaissance, 

motivated by their plan to profit from the misappropriation of 

the Brain Cooling Method and related proprietary information 

belonging to Toev, intentionally and unjustifiably induced Toev 

to breach its agreement with Ignition. 

67. As a consequence of Schwartz, Solar, Lieber, and 

Renaissance’s tortious interference with the contract between 

Ignition and Toev, Ignition has been damaged in an amount to be 

determined at trial, but believed to be not less than $350,000, 

plus interest, and is entitled to 7% of Toev’s stock. 

AS AND FOR A FOURTH CAUSE OF ACTION

(Tortious Interference with Business Relations) 

68. All allegations in the paragraphs above are 

incorporated by reference. 

69. Ignition was hired by Toev to perform start-up 

consulting and to obtain funding for Toev. 

70. Ignition prepared presentations and contacted 

several venture capital firms for the purpose of obtaining 

funding for Toev. 

71. Ignition kept Schwartz and Solar apprised of its 

progress in securing funding for Toev. 

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72. Ignition was successful in using its contacts and 

resources to find prospective investors for Toev, and informed 

Schwartz that it had found several prospective investors 

interested in funding Toev. 

73. In May 2004, despite the fact that Ignition had 

found prospective investors willing to invest in Toev, Solar 

abruptly and without explanation refused to allow Toev to 

consider offers of investment in Toev from prospective investors 

sourced by Ignition. 

74. Toev was not allowed to continue negotiations 

with prospective investors sourced by Ignition because Schwartz, 

Solar, Lieber, and Renaissance had -- in breach of their 

fiduciary duties to Toev -- formed or were in the process of 

forming ThermopeutiX, a company they intended to use as a 

vehicle to profit from their misappropriation of the Brain 

Cooling Method and other proprietary information belonging to 

Toev. 

75. Ignition’s relations with the prospective 

investors that it had sourced for Toev and its reputation among 

other funding sources has been harmed as the result of Solar’s 

refusal to allow Toev to consider the offers of investment 

sourced by Ignition. 

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76. Consequently, Ignition has been damaged in an 

amount to be determined at trial, but believed to be not less 

than $500,000. 

AS AND FOR A FIFTH CAUSE OF ACTION

(Conversion) 

77. All allegations contained in the paragraphs above 

are incorporated by reference. 

78. Defendants have wrongfully exercised dominion and 

control over the Brain Cooling Method and other proprietary 

information belonging to Toev. 

79. As the result of defendants’ conversion, Toev has 

been damaged in an amount to be determined at trial, but 

believed to be not less than $20 million. 

80. Plaintiffs also request the imposition of 

punitive damages against Schwartz, Solar, Lieber, and 

Renaissance for their egregious conduct, including their 

reckless breaches of the fiduciary duties that they owed to Toev 

and its shareholders and their wholesale misappropriation of 

Toev’s proprietary information for their own benefit. 

AS AND FOR A SIXTH CAUSE OF ACTION

(Breach of Contract/Violation of Corporate Law) 

81. All allegations in the paragraphs above are 

incorporated by reference. 

82. Schwartz, Solar, Lieber, and Renaissance engaged 

in actions, including, but not limited to, various acts of self15

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dealing and oppression of minority shareholders, that violated 

the Toev shareholder agreement, Toev’s by-laws, the Stock 

Purchase Agreement, and corporate law, for the purpose of 

misappropriating the Brain Cooling Method and other proprietary 

information belonging to Toev for their own benefit. 

83. As the result of Schwartz, Solar, Lieber, and 

Renaissance’s breaches of the Toev shareholder agreement, Toev’s 

by-laws, the Stock Purchase Agreement and violation of 

applicable corporate law, plaintiffs have been damaged in an 

amount to be determined at trial, but believed to be not less 

than $20 million. 

84. Plaintiffs also request the imposition of 

punitive damages against Schwartz, Solar, Lieber, and 

Renaissance for their egregious conduct, including their 

reckless breaches of the fiduciary duties that they owed to Toev 

and its shareholders and their wholesale misappropriation of 

Toev’s proprietary information for their own benefit. 

AS AND FOR A SEVENTH CAUSE OF ACTION

(Misappropriation of Trade Secrets) 

85. All allegations in the paragraphs above are 

incorporated by reference. 

86. Schwartz, Solar, Lieber, and Renaissance 

misappropriated trade secrets and other proprietary information 

belonging to Toev and founded ThermopeutiX for the purpose of 

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profiting from their misappropriation of Toev’s confidential 

information. 

87. As the result of Schwartz, Solar, Lieber, and 

Renaissance’s misappropriation of Toev’s trade secrets and 

proprietary information, Toev has been damaged in an amount to 

be determined at trial, but believed to be not less than $20 

million. 

88. Plaintiffs also request the imposition of 

punitive damages against Schwartz, Solar, Lieber, and 

Renaissance for their egregious conduct, including their 

reckless breaches of the fiduciary duties that they owed to Toev 

and its shareholders and their wholesale misappropriation of 

Toev’s proprietary information for their own benefit. 

JURY DEMAND

89. Plaintiffs demand trial by jury. 

WHEREFORE, plaintiffs respectfully request that a 

judgment be entered against defendants as follows: 

a. on the first cause of action, in an amount to be 

determined at trial, but believed to be not less 

than $20 million, imposing a constructive trust 

in favor of Toev, declaring Toev the owner of all 

stock in ThermopeutiX and all of its assets, 

directing defendants to disgorge any profits 

obtained as the result of their breaches of 

fiduciary duty and any compensation received 

during their periods of disloyalty, and punitive 

damages; 

b. on the second cause of action, in an amount not 

less than $450,000 plus attorneys’ fees, 

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interest, costs, disbursements, and punitive 

damages; 

c. on the third cause of action, in an amount not 

less than $350,000, plus interest, and directing 

the issuance of 7% of the outstanding stock in 

Toev to Ignition; 

d. on the fourth cause of action, in an amount to be 

determined at trial, but believed to be not less 

than $500,000; 

e. on the fifth cause of action, in an amount to be 

determined at trial, but believed to be not less 

than $20 million and punitive damages; 

f. on the sixth cause of action, in an amount to be 

determined at trial, but believed to be not less 

than $20 million and punitive damages; 

g. on the seventh cause of action, in an amount to 

be determined at trial, but believed to be not 

less than $20 million and punitive damages; 

h. granting plaintiffs, interest, costs, 

disbursements, and attorneys’ fees; and 

i. for such other relief as the Court may deem just 

and proper. 

Dated: Freeport, New York 

July 12, 2007 

LAW OFFICE OF MARC M. ISAAC PLLC 

 

 By: _/s/ Marc M. Isaac_________ 

 MARC M. ISAAC (MI-1873) 

 210 Moore Avenue 

Freeport, New York 11520 

 (516)750-1422 

 Attorney for Plaintiffs 

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