Case 1:15-cv-06663-CBA-RML Document 1 Filed 11/19/15 Page 1 of 11 PageID #: 1

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK
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SHALOM MOSKOWITZ, JACOB

MOSKOWITZ, and JOSHUA PARKAS, Civil Action No.

Plaintiffs,

-- against --

SUNGAME CORPORATION. NEIL

CHANDRAN, ROBERT KLOIHOFER,
GUY ROBERT, and RAJ PONNIAH,

Defendants.

COMPLAINT

Plaintiffs Shalom Moskowitz (“S. Moskowitz”), Jacob Moskowitz (“J.

Moskowitz”), and Joshua Farkas (“Farkas”), by their attorneys, and for their Complaint against

Defendants SunGame Corporation (“SunGame”), Neil Chandran (“Chandran”), Robert Kloihofer

(“}Uoihofer”), Guy Robert (“Robert”), and Raj Ponniah (“Ponniah”), allege as flows:

Nature of the Action

I. This diversity action seeks damages for breach of contract, fraud, unjust

enrichment, and conversion against Defendants, who were given money by each of the Plaintiffs

for various purposes, including investment in Defendant SunGame. the purchase of one or more

tablet computers or game consoles, or general purposes, each with the promise that their funds

would be returned to them by way of rebates, and most with promises that multiples of their

money would be returned to them within relatively short periods of time.

2. In each case, Defendants have wrongfully retained the funds long after

their 2014 due dates, and have strung Plaintiffs along with empty promises to deliver products
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and return their money, even though it is now obvious that Defendants never had any intention of

delivering the products ordered by Plaintiffs or returning Plaintiffs’ money, never mind the

promised extraordinary returns.

3. The individual Defendants are sued herein because, upon information and

belief, each of them received portions of the tendered funds in their personal capacity and

applied said funds not for any corporate purpose, but for their own personal use so as to incur

direct liability to Plaintiffs.

4. Upon information and belief, Defendants are engaging in a massive

scheme to defraud consumers generally, and are using newly acquired funds, among other things,

to pay off existing obligations. This unlawful scheme should not be countenanced by the Court,

and punitive damages should be awarded.

Parties

5. Plaintiff S. Moskowitz is a natural person residing in Brooklyn, New

York. He is a citizen and resident of the State of New York.

6. Plaintiff J. Moskowitz is a natural person residing in Monsey, New York.

He is a citizen and resident of the State of New York.

7. Plaintiff Farkas is a natural person residing in Brooklyn, New York. He is

a citizen and resident of the State of New York.

8. Upon information and belief, Defendant SunGame is a Delaware

corporation with principal offices in Las Vegas, Nevada.

9. According to its website, SunGame is a provider of 3D tablet technology.

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10. Upon information and belief, SunGame is operated and controlled by the

individual Defendants, and is used as a vehicle to perpetrate their unlawthl and fraudulent

scheme as set forth below.

11. Upon information and belief, Defendant Chandran is a natural person, and

a citizen and resident of Nevada.

12. Upon information and belief, Chandran is a director of SunGame, and the

chairman of SunGame’s board of directors.

13. Upon information and belief, at all times relevant to this action, and until

late 2014, Chandran was the CEO of SunGame.

14. Upon information and belief, Chandran is SunGame’s largest shareholder,

owning more than 90% of the outstanding shares of the company.

15. Upon information and belief, Defendant Kloihofer is a natural person, and

a citizen and resident of Florida. Upon information and belief, ICoihofer is an officer of

SunGame.

16. Upon information and belief, Defendant Robert is a natural person, and a

citizen and resident of Nevada. Upon information and belief, at all times relevant to this action,

Robert was an officer and director of SunGame, and variously, held the title of CEO and COO of

SunGame.

17. Upon information and belief, Defendant Ponniah is a natural person, and a

citizen and resident of Nevada. Upon information and belief, Ponniah is the current CEO of

SunGame, and at all times relevant to this action, was an officer and director of SunGame.

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Jurisdiction and Venue

18. This Court has subject matter jurisdiction pursuant to 28 U.S.C. § 1332

because Plaintiffs and Defendants are citizens of different States, and the amount in controversy

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

19. This Court has personal jurisdiction over Defendants pursuant to CPLR

301 because, upon information and belief, they are all regularly present in New York for the

purpose of doing business, and pursuant to CPLR 302(a)(j) and (3) because upon information

and belief, SunGame regularly transacts business in New York, including, ituer alia, soliciting

hinds from New York residents as hirther described herein, and all Defendants have engaged in

tortious conduct outside of New York affecting New York residents, namely Plaintiffs, and

Defendants regularly solicit and conduct business in New York.

20. Venue is proper in this District pursuant to 28 U.S.C. § 139 l(b)(2),

because, as further set forth herein, a substantial part of the acts and omissions giving rise to the

claims asserted herein occurred through solicitation in Brooklyn, New York.

General Factual Allegations

21. At various times in 2014, Plaintiffs, and each of them, were solicited by

Chandran or Kloihofer, purportedly on behalf of SunGame, and asked to purchase 3D tablet

computers or game consoles from SunGame.

22. In each case, Defendants Chandran or Kloihofer asked Plaintiffs to

purchase a quantity of tablet computers at $1,000 apiece, and to pay for those purchases in

advance, by credit card or wire transfer.

23. In each case, Defendants Chandran or Kloihofer told Plaintiffs that as part

of a special program Defendant SunGame was running, and as an incentive to induce Plaintiffs to

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“pre-purchase” the tablet computers before they were ready to be shipped to market, Plaintiffs

would receive a rebate of 100% of their purchase price one week after the initial funds were

tendered.

24. In most cases, as set forth below, Defendants Chandran or Kloihofer told

Plaintiffs that as a further inducement to pre-purchase the tablet computers, they would be given,

in addition to a rebate of the funds advanced, an additional rebate of several times the initial

purchase price, and that such rebates would be tendered in 30 days.

25. In several cases, as set forth below, Defendants Chandran or IGoihofer

solicited additional funds from Plaintiffs not, purportedly, for the purpose of purchasing tablet

computers, but to allow SunGame to pay certain operating expenses, which it turn, would allow

it to ship the tablet computers and provide the rebates to the Plaintiffs.

26. Upon information and belief, none of the money so tendered was applied

for the purpose represented by Defendants, but was used by SunGame for general purposes, or

by Defendants personally.

27. Upon information and belief, all representations made by Chandran and

IUoihofer were false.

28. Upon information and belief, the solicitations Plaintiffs received were part

of an unlawful scheme by SunGame and the individual Defendants to raise funds for SunGame’s

general corporate purposes, for their own personal use to fund their personal lifestyles, and to

pay back debts incurred to previous consumers and investors.

29. In each case, Plaintiffs relied upon misrepresentations made by Chandran

or Kloihofer, or other representatives of SunGame, purportedly on behalf of the company.

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30. In each case, the misrepresentations were material, and were calculated to

induce Plaintiffs to advance funds for purposes other than those claimed by the company.

31. Upon information and belief, to this day, SunGame does not have the

ability to deliver tablet computers or game consoles, and is continuing to raise funds from

additional consumers or prospective consumers using the same fraudulent scheme.

32. Upon information and belief, this fraudulent scheme has been going on for

several years, resulting in several lawsuits filed by consumers to attempt to recoup funds from

Defend ants.

33. Upon information and belief, Defendants are engaged in a pattern and

practice of such unlawful conduct, and their conduct complained of herein is willful, wanton,

intentional, and without regard to Plaintiffs’ lawful rights.

34. Upon information and belief, Defendants, and all of them have acted in

concert to deprive Plaintiffs of their rights, as fully set forth herein.

35. The specific statements and promises made to each Plaintiff are as

follows:

36. S. Moskowitz, was solicited in April, June, August, and November 2014.

37. Relying on Chandran’s and Kioihofer’s express representations that S.

Moskowitz would be purchasing tablet computers, or advancing expenses to facilitate the

purchase of same, and that all advanced funds would be returned in a week, S. Moskowitz

transferred to Chandran, by wire transfer, $15,000 on April 28, 2014; $30,000 on June 10, 2014;

$30,000 on August 8,2014; $30,000 on August 15, 2014; and $495 on November 4,2014.

38. Thus, S. Moskowitz is owed a total of S 105.495, plus interest.

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39. Specifically, J. Moskowitz was solicited in May, October, and December

2014 for the purchase of multiple tablet computers.

40. He was promised that he would receive rebates within two weeks of each

payment.

41. Relying on Chandran’s and Kloihofer’s express representations that he

would be purchasing tablet computers, J. Moskowitz advanced $30,000 to Chandran on May 19,

2014, by wire transfer to an account at JP Morgan; $100,000 on October 20, 2014 by wire

transfer to an account at Wells Fargo; $70,000 on October 22, 2014 by wire transfer to an

account at Wells Fargo; and $30,000 on December 19, 2014 by wire transfer to an account at

East West Bank.

42, Subsequent to December 2014, when J. Moskowitz contacted Chandran to

demand a rebate of his hinds, Charndran told him that in return for his forbearance, he would be

returned ten times his purchase price.

43. Thus, J. Moskowitz is owed a total of $230,000, plus interest in rebates,

and $2,300,000, plus interest in extraordinary payments.

44. Specifically, Farkas was solicited on April 27, 2014, and asked to

purchase $80,000 worth of tablet computers, and told that his money would be rebated no later

than May 10, 2014.

45. Relying on Chandran’s and Kloihofer’s express representations that he

would be purchasing tablet computers, Farkas advanced $80,000 to Chandran on April 27, 2014,

$20,000 by credit card to SunGame and $60,000 by wire transfer.

46. Thus, Farkas is owed a total of $80,000, plus interest.

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47. In none of the above instances was a singie tablet computer or game

console ever delivered to Plaintiffs.

4$. In none of the above instances were any of the fimds advanced returned.

49. In none of the above instances were any of the promised extraordinary

returns tendered.

50. Instead, SunGame and the individual Defendants kept all of Plaintiffs’

ffinds, returning nothing of value to Plaintiffs.

FIRST CLAIM FOR RELIEF

(Breach of Contract)

51. Plaintiffs repeat and reallege each and every allegation contained in

paragraphs I through 50 above as if each were fully set forth herein.

52. The promises made by Defendants to Plaintiffs constituted binding

contracts supported by good and valuable consideration.

53. Plaintiffs tendered finds to Defendants in the manner prescribed by

Defendants, and otherwise fulfilled their obligations to Defendants.

54. By failing to deliver products to Plaintiffs, failing to rebate Plaintiffs’

funds, and failing to remit to Plaintiffs the promised extraordinary returns on their funds,

Defendants breached their contracts with Plaintiffs.

55. As a result of the foregoing, Plaintiffs have been damaged in an amount to

be proven at trial, but in no event less than $415,495, plus interest.

SECOND CLAIM FOR RELIEF

(Fraud)

56. Plaintiffs repeat and reallege each and every allegation contained in

paragraphs I through 55 above as if each were fully set forth herein.

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57. The statements set forth herein above were made by Defendants to

Plaintiffs at the times and places herein described.

58. The statements set forth herein were material.

59. The statements set forth herein were false.

60. The false statements were made with the intent to induce Plaintiffs to

tender funds to Defendants.

61. Reasonably relying on Defendants’ false statements, Plaintiffs tendered to

Defendants funds in the amounts set forth above.

62. By reason of Defendants’ conduct, Plaintiffs were damages in an amount

to be proven at trial, but in no event less than $415,495.

63. Defendants’ conduct was willful, wanton, intentional, and without regard

to Plaintiffs’ lawful rights.

64. As a result, Plaintiffs are entitled to punitive damages in an amount to be

set by the Court.

THIRD CLAIM FOR RELIEF

(Unjust Enrichmcnt)

65. Plaintiffs repeat and reallege each and every allegation contained in

paragraphs 1 through 64 above as if each were fully set forth herein.

66. As set forth above, Plaintiffs tendered funds to Defendants which were

supposed to be applied toward the purchase of tablet computers, and to defray certain expenses

associated with the delivery of such tablet computers to Plaintiffs.

67. No tablet computers were ever delivered to any Plaintiff

68. Defendants refused to refund Plaintiffs’ money, despite due demand

having been made therefor.

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69. As a result, Defendants have retained $415,495 of Plaintiffs’ funds which

they should not, in good conscience, be permitted to keep.

70. Plaintiffs have no adequate remedy at law.

71. As a result, Defendants should return to Plaintiffs an amount to be proven

at trial, but in no event less than $415,495, plus interest.

FOURTH CLAIM FOR RELIEF

(Conversion)

72. Plaintiffs repeat and reallege each and every allegation contained in

paragraphs I through 71 above as if each were fully set forth herein.

73. As set forth above, Plaintiffs tendered funds to Defendants in the amount

of $415,495.

74. These funds were in consideration for products which were never shipped

or delivered to Plaintiffs.

75. Plaintiffs duly demanded a return of their funds.

76. Defendants have unlawfully retained possession of Plaintiffs’ funds

despite Plaintiffs’ demands for their return.

77. As a result, Plaintiffs have been damaged in an amount to be proven at

trial, but in no event less than $415,495, plus interest.

78. Defendants’ actions were willful, wanton, intentional, and without regard

to Plaintiffs’ lawful rights.

79. As a result, Plaintiffs are entitled to punitive damages in an amount to be

set by the Court.

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JURY DEMAND

80. Plaintiffs hereby demand a trial by jury as to each claim herein as maybe

tried to a jury.

WHEREFORE, Plaintiffs respectfully request that the Court enter judgment in

their favor, and against Defendants, jointly and severally, (i) on the First Claim for relief, in an

amount to be determined at trial but in no event less than $415,495, plus interest; (ii) on the First

Claim for relief, to Plaintiff J. Moskowitz, extraordinary returns in the amount of $2,300,000,

plus interest; (iii) on the Second Claim for relief, in an amount to be determined at trial, but in no

event less than $4 15,495, plus interest; (iv) on the Second Claim for Relief, for punitive damages

in an amount to be determined by the Court; (v) on the Third Claim for relief, in an amount to be

determined at trial but in no event less than $415,495, plus interest; (vi) on the Fourth Claim for

relief, in an amount to be determined at trial, but in no event less than $415,495, plus interest;

(vii) on the Fourth Claim for Relief, for punitive damages in an amount to be determined by the

Court; (viii) on all Claims for Relief, for pre- and post-judgment interest pursuant to law; (ix) on

all Claims for relief, for costs in bringing this action, including reasonable attorneys’ fees; and

(x) on all Claims for Relief, for such other and further relief as the Court deems just and proper.

Dated New York, New York

November 19, 2015

FEDER KASZOVITZ LLP

By:

Hov6rd I. Rhine (HR-1961)

David Sack (DS-6532)
845 Third Avenue
New York, New York 10022
Telephone: (212) 888-8200

Attorneys for Plaintiffs

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