Motion to Amend in SOUTHWEST LEGEND INVESTMENTS LLC vs. PURE AND NATURAL-LAKEWAY LLC, et al| Trellis.Law

On June 26, 2023 a Complaint,Petition was filed involving a dispute between Southwest Legend Investments Llc, and Gingerich, Thomas J, Gsrx Industries Inc, Pure And Natural-Lakeway Llc, Pure And Natural One-Tn Llc, for CNTR CNSMR COM DEBT in the District Court of Dallas County.

Preview
FILED
9/21/2023 12:44 PM
FELICIA PITRE
DISTRICT CLERK
DALLAS CO., TEXAS
Debra Clark DEPUTY

CAUSE NO. DC-23-08584

SOUTHWEST LEGEND IN THE DISTRICT COURT

§§§§§§§§§§§§§
INVESTMENTS LLC,

Plaintiff,

V.
134TH JUDICIAL DISTRICT
PURE AND NATURAL-LAKEWAY
LLC, PURE AND NATURAL ONE-TN,
LLC, GSRX INDUSTRIES INC., AND
THOMAS J. GINGERICH,

Defendants. DALLAS COUNTY, TEXAS
PLAINTIFF’S FIR_ST AMENDED PETITION
COMES NOW Plaintiff Southwest Legend Investments LLC, (“S WL” and/or “Plaintiﬂ”),

and ﬁles this its First Amended Petition complaining of Defendants Pure and Natural-Lakeway

LLC (“PN Lakeway”), Pure and Natural One-TN, LLC (“PN One”), GSRX Industries Inc.

(“GSRX”) and Thomas J. Gingerich (“Gingerich” and collectively with PN Lakeway, PN One,

and GSRX, “Defendants”), and respectﬁilly states the following:
I. DISCOVERY CONTROL PLAN AND STATEMENT OF RELIEF
1. Pursuant to Tex. R. CiV. P. 190.2, Plaintiff alleges that discovery should be conducted

under Level 1.

2. Plaintiff seeks monetary relief of $250,000.00 or less and non-monetary relief.

II. PARTIES AND SERVICE OF CITATION
3. Plaintiff Southwest Legend Investments LLC is a limited liability company organized and

existing pursuant to the laws of the State of Texas.

4. Defendant Pure and Natural-Lakeway LLC is a Texas limited liability company with its

principal place of business in the State of Texas. Defendant Pure and Natural — Lakeway LLC has

appeared and made an answer herein and may be served through its attorney of record.

PLAINTIFF’S FIRST AMENDED PETITION P ag e |
1
5. Defendant Pure and Natural One —
TN, LLC is a Texas limited liability company with its

principal place of business in the State of Texas. Defendant Pure and Natural One — TN, LLC has

appeared and made an answer herein and may be served through its attorney of record.

6. Defendant Thomas J. Gingerich is an individual resident of the State of Texas and has

appeared and made an answer herein and may be served through his attorney of record.

7. Defendant GSRX Industries Inc. is a foreign corporation organized and existing pursuant

to the laws of the state of Nevada. Defendant GSRX Industries Inc. has appeared and made an

answer herein and may be served through its attorney of record.

III. JURISDICTION AND VENUE

8. This Court has jurisdiction over Defendants Pure and Natural —
Lakeway LLC and Pure

and Natural One —
TN, LLC because Defendants are limited liability companies organized and

existing pursuant to the laws of the State of Texas.

9. This Court has jurisdiction over Defendant Thomas J. Gingerich because Defendant is an

individual resident of the State of Texas.

10. This Court has jurisdiction over Defendant GSRX Industries Inc. pursuant to Tex. Civ.

Prac. & Rem. Code §l7.042(1) because Defendant contracted in writing with Plaintiff, which is a

limited liability company organized and existing pursuant to the laws of the State of Texas, to

perform its obligations under a written contract in Dallas County, Texas.

ll. The Court has jurisdiction over the subject matter of this dispute pursuant to Article V of
the Texas Constitution because the amount in controversy exceeds $500.

12. This Court is an appropriate venue for this case because all or a substantial part of the

events giving rise to the claim occurred in Dallas County, Texas, and because the Settlement

Agreement forming the basis of this lawsuit calls for exclusive venue in Dallas County, Texas.

PLAINTIFF’S FIRST AMENDED PETITION P ag e |
2
IV. FACTUAL ALLEGATIONS
13. Plaintiff and Defendants entered into a business relationship in or around November of

2018, when Defendant Gingerich, an employee of GSRX, approached Plaintiff with an opportunity

to invest in PN Lakeway and PN One. The relationship between Plaintiff and Defendants

subsequently deteriorated due to Defendants’ conduct, forcing Plaintiff to take legal action against

Defendants.

14. Plaintiff instituted Cause No. DC-20-O9579 in the 160m Judicial District of the District

Court of Dallas County, Texas, styled Southwest Legend Investments LLC v. Pure and Natural —

Lakeway, LLC, Pure and Natural One — TN LLC, Thomas J. Gingerz'ch, and GSRX Industries, Inc.

(the “Lawsuit”). In the Lawsuit, SWL asserted causes of action against Defendants for Accounting

Act Violations, breach of ﬁduciary duty, conversion, fraud, unjust enrichment, and breach of

contract.

15. On June 29, 2022, the parties to the Lawsuit reached a settlement of all matters in

controversy between them and executed a Settlement and Release Agreement (the “Settlement

Agreement”). The Settlement Agreement provides, that in consideration of the Settlement

Agreement and as a material inducement and condition precedent thereto, Defendants agreed to

pay Plaintiff a total consideration of $175,000.00 and Defendant GSRX agreed to issue a note

payable to Plaintiff in the amount of $150,000.00 (the “Note”). The payment term of the Note was

eighteen (18) months, with a maturity date of December 31, 2023. As set forth above, the

Settlement Agreement states in Section 2 that “Defendants agree to pay SWL a total consideration

of $175,000.00”, emphasis added. While GSRX was the maker under the Note, each of the

Defendants named herein has breached their obligations under the Settlement Agreement.

16. The Note further provides that from January 2023 to March 2023, GSRX was obligated to

make payments to Plaintiff in the amount of $5,000.00 per month. From April 2023 to December

PLAINTIFF’S FIRST AMENDED PETITION P ag e |
3
2023, GSRX is obligated to make payments to Plaintiff in the amount of $15,000.00 per month.

In relevant part, the Note provides that such Note shall become due and payable in its entirety upon

written demand by Plaintiff if one or more of the following events shall occur and be continuing

(“Events 0fDefault’ ’):

(i) Application for, or consent to, the appointment of a receiver, trustee, or liquidator

of the Maker or of its property;

(ii) General assignment by the Maker of all or substantially all of its assets for the

beneﬁt of creditors;

(iii) Filing by the Maker of a voluntary petition in bankruptcy or a petition or an answer

seeking reorganization, or arrangement with creditors; or

(iv) Maker fails to pay any amount (whether principal, interest, late charge, or other

amounts) within ten (10) days after it is due under this Note.

17. The Note states that payment shall be made on the last day of the applicable month.

Defendant GSRX made the required payments under the Note for the months of January 2023 to

March 2023. However, GSRX failed to make its required April 2023 payment under the Note,

which was due on April 30, 2023. The Note afforded GSRX a grace period of ten (10) days in

which to make the April 2023 payment, but GSRX failed to do so.

18. Further, the note provides that for so long as any Event of Default exists thereunder, and

in addition to all other rights and remedies of Plaintiff, interest shall accrue at the rate of ten percent

(10%) per annum, but in no event in excess of the highest rate permitted by applicable law (the

“Default Rate”), and such accrued interest shall be immediately due and payable. An Event of

Default under the Note has existed since May 10, 2023, or ten (10) days after GSRX missed its

PLAINTIFF’S FIRST AMENDED PETITION P ag e |
4
required April 2023 payment. Accordingly, interest has accrued on the Note at the Default Rate in

an amount not less than $1,479.45 and continues to accrue on a daily basis.

19. On May 18, 2023, in accordance with the terms of the Note, Plaintiff sent written demand

to GSRX notifying it that (i) GSRX missed its required April 2023 payment under the Note; (ii)

that the Note was accelerated in its entirety; (iii) the entire outstanding balance of the Note was

due and owing; and (iv) Plaintiff further demanded full payment of interest and its attorney’s fees

as provided for in the Note.

20. Defendant GSRX failed to comply with Plaintiffs demand for immediate payment of the

outstanding principal balance of $135,000.00 under the Note, all interest accrued to date as

provided for by the Note, and all attorney’s fees incurred by Plaintiff in the collection of amounts

due and owing under the Note as provided therein. GSRX subsequently failed to make its required

payment of $15,000.00 to Plaintiff for the month of May 2023, which was due on May 30, 2023.

21. When Plaintiff entered into the Settlement Agreement with Defendants, Plaintiff

reasonably expected that Defendants would honor the terms of the Settlement Agreement by

paying the agreed-upon settlement consideration. Plaintiff further reasonably relied upon

Defendants’ representations that they would pay the settlement consideration when Plaintiff

executed the Settlement Agreement and dismissed the Lawsuit. Defendants, however, Without

excuse, justiﬁcation, or basis, have failed and refused to pay the agreed-upon settlement

consideration.

CONDITIONS PRECEDENT

22. All conditions precedent for SWL to bring this action have been performed, have occurred,

or have been waived or excused.

PLAINTIFF’S FIRST AMENDED PETITION P ag e |
5
V. CAUSES 0F ACTION

A. Count 1: Breach of Contract

23. SWL incorporates the factual statements set forth above and below as if set forth fully

herein. In addition to and/or in the alternative to the other counts set forth herein, SWL alleges that

Defendants have breached the Settlement Agreement and that Defendant GSRX has breached the

terms of the Note.

24. SWL and Defendants entered into a valid and enforceable contract related to the settlement

of all matters set forth in the Lawsuit and the payment of settlement consideration to SWL. SWL

fully performed its obligations under the Settlement Agreement. Defendants, however, have failed

and refused to honor their obligations under the Settlement Agreement by paying the required

settlement consideration set forth therein. Defendants have therefore breached the Settlement

Agreement by failing to make required payments to SWL.

25. Defendant GSRX further entered into a valid and enforceable contract with Plaintiff when

it executed the Note. Plaintiff has fully performed its obligations under the Note, but GSRX has

failed and refused to perform its obligations under the Note by making required payments to

Plaintiff. Despite written demand by Plaintiff, Defendant GSRX has breached its obligations under

the Note.

26. As a direct and proximate result of Defendants’ breaches of the Settlement Agreement and

the Note, SWL has been signiﬁcantly damaged.

B. Count 2: Fraud

27. SWL incorporates the factual statements set forth above and below as if set forth fully

herein. In addition to and/or in the alternative to the other counts set forth herein, SWL alleges that

Defendants have committed fraud against SWL.

PLAINTIFF’S FIRST AMENDED PETITION P ag e |
6
28. Defendants represented to SWL that they would pay the settlement consideration set forth

in the Settlement Agreement and the Note. Defendants’ representations were material. Defendants’

representations to SWL regarding payment of the settlement consideration contained in the

Settlement Agreement and the Note were false.

29. Defendants either knew the representations were false or made them recklessly, as a

positive assertion and without knowledge of its truth.

30. Defendants either intended for SWL to rely on or had reason to expect that SWL would act

in reliance on the false representations by entering into the Settlement Agreement and dismissing

the Lawsuit.

31. SWL justiﬁably relied on Defendants’ false representations when it executed the

Settlement Agreement and dismissed the Lawsuit.

32. Defendants’ false representations directly and proximately caused injury to SWL, for

which SWL seeks actual, consequential, and punitive damages.

C. Count 3: Negligent Misrepresentation

33. SWL incorporates the factual statements set forth above and below as if set forth fully

herein. In addition to and/or in the alternative to the other counts set forth herein, SWL alleges that

Defendants made negligent misrepresentations to SWL.

34. Defendants made false representations of fact to SWL when Defendants represented that

they would pay the consideration required by the Settlement Agreement and the Note. Defendants

made the false representations in the course of a transaction in which they had a pecuniary interest.

Further, Defendants failed to use reasonable care in making the representations.

35. SWL justiﬁably relied upon Defendants’ misrepresentations when it entered into the

Settlement Agreement and dismissed the Lawsuit.

PLAINTIFF’S FIRST AMENDED PETITION P ag e |
7
36. Defendants’ misrepresentations proximately caused injury to SWL, for which SWL seeks

actual, consequential, and punitive damages.

VI. ATTORNEY’S FEES
34. The Note provides that “if the indebtedness evidenced by this Promissory Note is collected,

or attempted to be collected, through an attorney, the prevailing party shall be entitled to recover

reasonable attorney’s fees.” Plaintiff made written demand upon GSRX for payment of the

indebtedness evidenced by the Note on May 18, 2023, but Defendants have Wholly failed and

reﬁised to pay the sums due and owing to SWL. Defendants PN Lakeway, PN One, and Gingerich

have further breached their valid and enforceable contract with Plaintiff by failing to pay the

settlement consideration required by the Settlement Agreement.

35. As a result of Defendants’ failure to pay SWL as set forth herein, it has been necessary for

SWL to retain the services of the undersigned attorneys and law ﬁrm to represent SWL in

connection with the recovery of the amounts due and owing to SWL from Defendants. Plaintiff is

therefore entitled to recover its reasonable attorneys' fees in addition to its actual damages pursuant

to TEX. CIV. PRAC. & REM. CODE § 38.001.

VII. PRAYER
WHEREFORE PREMISES CONSIDERED, Plaintiff Southwest Legend Investments LLC

requests that Defendants Pure and Natural
—
Lakeway LLC, Pure and Natural One-TN, LLC,

Thomas J. Gingerich, and GSRX Industries Inc. be cited to appear and that upon ﬁnal trial, Plaintiff

Southwest Legend Investments LLC have judgment against Defendants for:

a. $135,000.00 for breach of contract;

b. Consequential damages;

c. Punitive damages;

d. Pre-judgment interest;

PLAINTIFF’S FIRST AMENDED PETITION P ag e |
8
e. Post-judgment interest;

f. Reasonable attorneys‘ fees;

g. All costs of court; and
h. Such other and further relief to which Plaintiff Southwest Legend Investments LLC
may be justly entitled either at law or in equity.

Dated: September 21, 2023

Respectfully submitted,

LIBBY SPARKS WILLIS STARNES PLLC
5950 Berkshire Lane, Suite 200
Dallas, TX 75225
T: (214) 390-2300
F: (214) 390-9965

g/Aﬁr
Ryan A. Starnes
State Bar No. 24070669
rstarnes@libbysparks.com
Jonathan Brad Bryan
State Bar No. 24073254
bbryan@libbysparks.com
A TTORNE YS FOR PLAINTIFF
SOUTHWEST LEGEND INVESTMENTS LLC

PLAINTIFF’S FIRST AMENDED PETITION Page|9
CERTIFICATE OF SERVICE
I hereby certify that on September 21, 2023, a true and correct copy of the foregoing was
delivered Via the Court’s CM/ECF system to all known counsel of record, pursuant to the Texas
Rules of Civil Procedure, as follows:

SCHEEF & STONE, L.L.P.
500 North Akard Street, Suite 2700
C. Brenton Kugler
brent.kugler(a)solidcounsel.com
ATTORNEY FOR DEFENDANTS

g/Aﬁ
Ryan A. Starnes

PLAINTIFF’S FIRST AMENDED PETITION P ag e |
10
Automated Certificate of eService
This automated certificate of service was created by the efiling system.
The filer served this document via email generated by the efiling system
on the date and to the persons listed below. The rules governing
certificates of service have not changed. Filers must still provide a
certificate of service that complies with all applicable rules.

Jennifer Wallace on behalf of Ryan Starnes
Bar No. 24070669
jwallace@libbysparks.com
Envelope ID: 79803344
Filing Code Description: Amended Petition
Filing Description: FIRST
Status as of 9/21/2023 1:07 PM CST
Associated Case Party: GSRX INDUSTRIES INC

Name BarNumber Email TimestampSubmitted Status
Loretta Forbey loretta.forbey@solidcounsel.com 9/21/2023 12:44:29 PM SENT
Brent Kugler brent.kugler@so|idcounse|.com 9/21/2023 12:44:29 PM SENT
Anthony Vecchione anthony.vecchione@solidcounsel.com 9/21/2023 12:44:29 PM SENT
Damaris Walker damaris.walker@solidcounsel.com 9/21/2023 12:44:29 PM SENT

Case Contacts

Name BarNumber Email TimestampSubmitted Status

Ryan AStarnes rstarnes@libbysparks.com 9/21/2023 12:44:29 PM SENT
J. Bailey jbailey@|ibbysparks.com 9/21/2023 12:44:29 PM SENT
Jonathan Bryan bbryan@|ibbysparks.com 9/21/2023 12:44:29 PM SENT
Connall DuncanMcCormack cmccormack@libbysparks.com 9/21/2023 12:44:29 PM SENT
Jennifer Wallace jwallace@libbysparks.com 9/21/2023 12:44:29 PM SENT

Case Info

Judge

TILLERY, DALE Track Judge’s New Case

Case No.

(Subscribe to View)

Document Filed Date

September 21, 2023

Case Filing Date

June 26, 2023

County

Parties

For full print and download access, please subscribe at https://www.trellis.law/.

Complaint,Petition: SOUTHWEST LEGEND INVESTMENTS LLC vs. PURE AND NATURAL-LAKEWAY LLC, et al

Preview

Related Topics

Case Info

Parties