COMMITMENTS AND CONTINGENCIES - Note 5

6 Months Ended

Jun. 30, 2016

NOTE 5 - COMMITMENTS AND CONTINGENCIES

Leases

Effective September 1, 2013, we renewed our lease for office space in Los Angeles, California with a term through August 31, 2018. The lease currently requires a monthly payment of $8,250. Total rent expense for the six months ended June 30, 2016 and 2015 were $49,500 and $52,125 respectively. Future minimum lease payments as of June 30, 2016, under non-cancelable operating leases (with initial or remaining lease terms in excess of one year) are as follows:

Year Ending		Operating		Capital
December 31,		Leases		Leases

2016 (Remainder of)	$	49,500	$	13,222
2017		99,900		-
2018		99,900		-
Total minimum lease payments	$	249,300	$	13,222

Legal Matters and Contingencies - Note 5

Litigation Matters

From time to time, we are involved in various legal proceedings generally incidental to our business. While the result of any litigation contains an element of uncertainty, our management presently believes that the outcome of any known, pending or threatened legal proceeding or claim, individually or combined, will not have a material adverse effect on our financial statements.

On December 9, 2011, MyMedicalRecords, Inc. entered into a Non-Exclusive Settlement and Patent License Agreement with Surgery Center Management LLC ("SCM"). In consideration for the rights granted under that Agreement and in consideration of a settlement and release agreement, SCM contracted to pay MyMedicalRecords, Inc. an initial payment of $5 million payable on December 23, 2011, and additional payments of $5 million per year for five consecutive years. After unsuccessful attempts to collect the past due amount of $5 million, on January 19, 2012, MyMedicalRecords, Inc. filed a lawsuit in the Superior Court of the State of California for the County of Los Angeles for breach of contract. At this time, MMR believes that SCM owes the Company $30 million plus interest. On February 13, 2014, SCM filed a cross-complaint alleging claims for breach of that contract, among other things, which SCM has amended twice. The case is scheduled for trial on November 1, 2016. MyMedicalRecords, Inc. will continue to pursue its claim and defenses, but the Company cannot predict the chances of either a favorable or unfavorable outcome, nor does the Company have sufficient information regarding its ability to collect any judgment MyMedicalRecords, Inc. may obtain against SCM.

On April 2, 2015, the Company and Stradling Yocca Carlson & Rauth, P.C. ("SYCR"), were notified of the determination of an arbitrator in regards to disputes over amounts of monies due SYCR regarding prior services rendered. SYCR and the Company has previously agreed to a non-binding arbitration of the matter. The Company received an award in favor of SYCR in the amount of $285,000 which the Company disputes, notwithstanding, that it represents a reduction of SYCR's original $571,000 claim or $286,000 in favor of the Company. Since the arbitration award is non-binding the Company has filed an appeal of the remaining award. The Company cannot predict the chances of either a favorable or unfavorable outcome of the appeal.

Two separate MyMedicalRecords health IT patents were accepted by the Australia Patent Office in 2015 and subject to Opposition. On January 8, 2015, Australia Patent Application No. 2011307287, "Universal Patient Record Conversion Tool," was accepted by the Australia Patent Office. An opposition was filed on April 21, 2015 by The Crown in the Right of the Commonwealth of Australia (Department of Health). A second opposition was filed on April 22, 2015 by the Medical Software Industry Association, Inc. which aligned itself with the Crown. In the interim, a divisional application, Australia Patent Application No.2015201900, was filed on October 15, 2015. On July 6, 2015, Australia Patent Application No. 2013212253, "Mobile Platform for Personal Health Records," was accepted by the Australia Patent Office. An opposition was filed on October 13, 2015 by the Medical Software Industry Association, Inc. and a second opposition was filed on October 16, 2015, by the Crown in the Right of the Commonwealth of Australia (Department of Health). A third opposition was filed on October 16, 2015, by the National E-Health Transition Authority Limited (NEHTA). The first opposition was dismissed on February 19, 2016. The second opposition and the third opposition remain pending. Subsequently the Company has filed requests for withdrawal of the disputed application(s) and divisional applications while the Company continues to pursue settlement opportunities surrounding its remaining Australian Patents. Elsewhere, Patent No. 326616 with the same title and subject matter was issued in Mexico on January 6, 2015, and on May 5, 2016, we received notice that the "Universal Patient Record Conversion Tool," Patent Application No. 2013023072, was accepted and is also being granted in Singapore.

An additional divisional application under "Mobile Platform for Personal Health Records," Australia Patent Application No. 2015101556, was filed on October 21, 2015 and granted on November 12, 2015 as an Innovation Patent. In addition to Australia Patent No. 2015101556, MMR was previously issued two Australia health IT patents under the title "Method and System for Providing Online Medical Records": Patent No. 2006202057 issued on May 29, 2008 and Patent No. 2008202401 issued on December 24, 2009.

MMRGlobal, Inc. 10-Q