Kevin Kulak v. Itshak On

── Kevin Kulak v. Itshak On ── Court: Court of Chancery of Delaware Date: April 24, 2026 Category: General COURT OF CHANCERY OF THE STATE OF DELAWARE KATHALEEN ST. JUDE MCCORMICK LEONARD L. WILLIAMS JUSTICE CENTER CHANCELLOR 500 N. KING STREET, SUITE 11400 WILMINGTON, DELAWARE 19801-3734 April 24, 2026 J. Clayton Athey, Esq. Itshak On Prickett, Jones & Elliott, P.A. Keren-Or On 1310 N. King Street 24 Haavoda St. Wilmington, Delaware 19801 Tel-Aviv, Israel 6382132 Re: Kevin Kulak v. Itshak (“Itzik”) On, et al., C.A. No. 2023-0011-KSJM Dear Counsel, Mr. On, and Ms. On, This decision addresses eight pending motions: Plaintiff’s Request to Strike Defendants’ Answering Brief for Exceeding Word Count;1 Plaintiff’s Motion for Partial Summary Judgment;2 Plaintiff’s First Motion for Sanctions;3 Plaintiff’s Second Motion for Sanctions;4 Defendants’ Motion to Intervene filed on behalf of Movado Stockholders;5 Defendants’ Submission Regarding Discovery in Aid of 1 C.A. No. 2023-0011-KSJM Docket (“Dkt.”) 143. 2 Dkt. 130. 3 Dkt. 55 (Pl.’s Motion for Sanctions).The court took this matter under advisement as the parties submitted additional evidence. See Dkts. 88, 89. 4 Dkt. 111. 5 Dkt. 140. C.A. No. 2023-0011-KSJM April 24, 2026 Page 2 of 35 Execution;6 Defendants’ Motion to Stay Summary Judgment;7 and Defendants’ Request for Leave to File Summary Judgment.8 I. FACTUAL BACKGROUND Unless otherwise noted, the background is drawn from undisputed facts in the pleadings and exhibits the parties submitted.9 A. Defendants Form Movado. Siblings Itshak (“Itzik”) On and Keren-Or On founded Movado PT Technologies Inc. (“Movado” or the “Company”) in July 2020. Movado is a Delaware corporation.10 Movado’s sole product was a mobile phone application that aimed to analyze a user’s musculoskeletal conditions and provide an automated, tailored rehabilitation plan using artificial intelligence and two- and three-dimensional analysis.11 Movado wholly owns two foreign subsidiaries: Movado PT Technologies Ltd. (“Movado Israel”), which operated in Israel; and Sironaphysio Sociedad de 6 Dkt. 152. 7 Dkt. 147. 8 Dkt. 159. 9 This decision cites to the exhibits submitted with the briefing for summary judgment by “Ex.” number. Plaintiff submitted 80 exhibits; Defendants submitted 16 exhibits. Defendants’ deposition transcripts are cited using their first name and “Dep. Tr.” The decision also notes in citation form where a witness testified pursuant to the motions for sanctions. This decision refers to Itzik and Keren-Or by their first names to distinguish them. The court intends no familiarity or disrespect. 10 See Ex. 1 (Movado 2021 Annual Franchise Tax Report). 11 See Ex. 2 (“June 2020 Investor Presentation”). C.A. No. 2023-0011-KSJM April 24, 2026 Page 3 of 35 responsabilidad limitada de capital variable (“Movado Mexico”), which operated in Mexico.12 Movado Israel handled all research and development, recruitment, and salaries, and paid for all of Movado’s non-U.S. expenses.13 Movado and Movado Israel held separate bank accounts at Bank Leumi.14 Movado Mexico was formed for the sole purpose of signing an agreement with the Mexican Social Security Institute (“IMSS”) due to restrictions imposed by the Mexican government concerning the domicile of contracting counterparties.15 During the relevant period, Defendant Itzik16 served as Movado President and board chairman.17 Itzik was mainly responsible for Movado’s fundraising efforts, including outreach to potential