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and market the products. The complaint also discussed the loans
made by ProGuard to petitioner. Petitioner alleged that he
“reasonably believed” that the loans represented advances of
future compensation to be paid to him rather than a decrease in
his expected capital interest.
The complaint referred to a document titled “Amendment to
Contract for Services dated June 26, 1994 and Secured Promissory
Note” signed in June 1997 (June 1997 agreement). Petitioner
additionally alleged that, in the June 1997 agreement, ProGuard
loaned to him a final amount of $10,174.72 and, in consideration
of this loan, petitioner waived any interest in a future startup
entity formed by petitioner and the defendants.
After raising the general allegations regarding the contract
and the June 1997 agreement, the complaint raised several causes
of action including: (1) Rescission based on undue influence;
(2) rescission based on fraud and false promises; (3) breach of
contract; (4) breach of covenant of good faith and fair dealing;
(5) declaratory relief; (6) slander; (7) constructive trust;
(8) quantum meruit; (9) conspiracy; (10) intentional infliction
of emotional distress; and (11) injunctive relief.
On October 2, 1997, petitioner filed a first amended
complaint in the lawsuit. The amended complaint added
reformation based on unconscionability, fraud, and unilateral
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