EMA Fin'l LLC v. Vystar Corp.

OPINION & ORDER EMA Financial, LLC (“EMA”) brought this suit against Vystar Corp. (“Vystar”) for breach of contract. See Complaint, filed Feb. 19, 2019 (Docket # 1) (“Comp.”). Vystar has counterclaimed for breach of contract, unjust enrichment, and a declaratory judgment that the loan agreement at issue is unconscionable and unenforceable. See Amended Answer, Affirmative Defenses and Counterclaims, filed Apr. 16, 2020 (Docket # 60) (“AAC”). EMA has moved for summary judgment on its breach of contract claim and for dismissal of Vystar’s counterclaims.¹ Vystar has moved for summary judgment in favor of its counterclaims and for dismissal of EMA’s claim for breach of contract.² On January 6, 2023, the Court held oral argument on the motions and issued rulings with respect to certain issues raised by the parties. See Transcript, filed Jan. 17, 2023 (Docket # 231) (“Tr.”). It also directed the parties to supplement their briefing in accordance with those rulings. See id. Both EMA and Vystar supplemented their briefing as directed.³ The loan agreement at issue in this case is complex. Each side has raised a number of issues in an effort to justify its position that the agreement either has or has not been breached by the other side, or that some other principle affects the enforcement of the agreement. We address in this Opinion and Order only those issues, whether presented as claims or defenses, that are necessary to determine whether either party is entitled to summary judgment. For the reasons stated below, the Court denies EMA’s motion for summary judgment and grants Vystar’s motion for summary judgment. I. BACKGROUND The following facts are not in dispute unless otherwise noted. A. Facts EMA is a Delaware limited liability company with a place of business in New York. Comp. 2. Vystar is a Georgia corporation with its principal place of business in Massachusetts. Id. 5. On January 29, 2018, EMA and Vystar executed a Note and a corresponding Securities Purchase Agreement. See Note, annexed as Ex. 3 to S. Rotman Decl. (Docket # 193-3) (“Note”); Securities Purchase Agreement, annexed as Ex. 4 to S. Rotman Decl. (Docket # 193-4) (“SPA”); Parties’ Rule 56.1 Joint Statement of Undisputed Facts and Stipulated Documents, filed May 24, 2022 (Docket # 201) (“Joint 56.1 Stat.”), at

1.i-ii. The Note’s stated value is $80,000 and provides that in exchange for a payment of $75,500 from EMA, Vystar promises to pay back EMA $80,000 pursuant to the Note’s terms. Note at 1; SPA