Vonetize Sale Dropped Following Lawsuit Alleging Buyer Is a Fraud

Tel Aviv-listed over the top (OTT) Vonetize PLC has canceled a deal with Desilu Studios Inc., the Tel Aviv Stock Exchange on Sunday. In its filing, Vonetize said the decision was made because of recurring delays in money transfers and a lawsuit filed by U.S. broadcaster CBS alleging Desilu Studios and its chairman Charles B. Hensley have misled investors.

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Founded in 2011 and headquartered in Tel Aviv, Vonetize offers technology that targets users at specific times in the world. It operates with Disney, Warner Brothers, 20th Century Fox, Sony, and Universal Studios.

Vonetize co-founder and CEO Noam Josephidis. Photo: Sharon Bareket

On March 18, Vonetize said Desilu Studios agreed to pay cash for a 10% stake in the company, at a rate of $ 1.41 per share, reflecting a market valuation of $ 50 million. Vonetize's stock was up 82.9%, trading at NIS 2.25 (approximately $ 0.6). The company's stock has gone down significantly, and was traded at NIS 0.567 (approximately $ 0.15) by market close Sunday.

Since the deal has been announced, Desilu Studios has asked for a number of extensions, most recently in June, according to Vonetize's filing with the Tel Aviv Stock Exchange.

In its lawsuit, CBS claims Hensley and his company are affiliated with Desilu Productions, a U.S. production company that was co-owned by actors Desi Arnaz and Lucille Ball. Operated between 1950 and 1967, Arnaz and Ball's Desilu Productions was the company behind hit television series "I Love Lucy," "Star Trek," "Mission: Impossible," and "The Untouchables," acquired by CBS in the late 1960s. CBS claimed that it is not a registered trademark for the Desilu brand, it is the holder of the common law in the name of "it has been using it for owned brands.

According to its Monday announcement, Vonetize decided to add Desilu Studios as a major stakeholder "in light of the serious allegations against it and the holder of its controlling interest," and that it is examining legal actions against Desilu Studios for damages. "Vonetize co-founder and CEO Noam Josephidis said in a telephone interview with Calcalist Sunday. Vonetize does not want to add a major stakeholder whose identity is currently in question, he added.