{"url_path":"/sec/ozsc/10-k/2026/item-3","section_key":"item-3","section_title":"Item 3 LEGAL PROCEEDINGS.**","topic":"sec","document":{"doc_type":"10-K","doc_date":"2026-05-14","source_url":"https://www.sec.gov/Archives/edgar/data/1679817/0001493152-26-023179-index.html","accession_number":"0001493152-26-023179","cik":"0001679817","ticker":"OZSC","issuer_name":"OZOP ENERGY SOLUTIONS, INC.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1679817/0001493152-26-023179-index.html","primary_entity_key":"0001679817","primary_entity_name":"OZOP ENERGY SOLUTIONS, INC."},"word_count":359,"has_tables":true,"body_markdown":"**ITEM\n3. LEGAL PROCEEDINGS.**\n\n \n\nWe\nwere involved as a plaintiff in a Complaint filed in the **SUPERIOR COURT OF THE STATE OF CALIFORNIA FOR THE COUNTY OF SAN DIEGO NORTH\nCOUNTY (the “Complaint”)**on November 14, 2022**.** The Complaint alleges that former employees would place an order\nfrom a customer for purchase of product from OZOP with funds the exact source of which is presently unknown. OZOP alleges that next,\nthe customer would sell that product to OZOP’s customers at a price marked up from the price for which the customer purchased from\nOZOP – to the benefit of Defendants and to the detriment of OZOP, their employer at the time. The Complaint further alleges that\nthe former employees falsely represented that the price the customer was obtaining from other suppliers and therefore was willing to\npay for OZOP product decreased, which allowed them to use the customer to then sell additional product to OZOP’s customers at increasingly\nlarger margins, thus further wrongfully enriching themselves to the detriment of their employer, OZOP. The lawsuit also alleges that\nthe employees were also making false statements to Ozop’s customers regarding the financial condition of Ozop and the lack of module\ninventory.\n\n \n\nOn\nApril 4, 2024, the Company executed a Settlement Agreement (the “Settlement”) with its former employees and Your Home Solutions\nCorp (“YHS”). YHS and the former employees were all defendants (the “Defendants”) in the Complaint. Pursuant\nto the terms of the Settlement, the Defendants paid the Company $1,125,000 during the year ended December 31, 2024. In exchange, the\nCompany agreed to release all Defendants from the lawsuit and to deliver 11 containers of solar panels. Upon the receipt of the $1,125,000\nand the delivery of the 11 containers, and pursuant to the Settlement, the Company recorded sales of $728,640, a credit of $125,000 to\nlegal expense and for the year ended December 31, 2024, recorded a gain on litigation settlement of $271,360.\n\n \n\nOther\nthan the above, we know of no legal proceedings to which we are a party or to which any of our property is the subject, which are pending,\nthreatened or contemplated or any unsatisfied judgments against the Company."}