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7. LEGAL SETTLEMENT
9 Months Ended
Sep. 30, 2015
Commitments and Contingencies Disclosure [Abstract]  
7. LEGAL SETTLEMENT

On August 11, 2015, PSKW, LLC (“PSKW”) served 3Pea International, Inc. (“3PEA”), with a complaint styled PSKW, LLC v. 3Pea International, Inc., filed in the United States District Court for the Northern District of California, Case No. 5:15-cv-03576-RMW, San Jose Division (the “Action”). In the Action, PSKW asserted claims against 3PEA for $5,800,000 for marketing fees allegedly due by 3PEA. 3PEA contended, among other things, that PSKW breached its agreement with 3PEA, for which 3PEA was damaged in an amount in excess of the amount which PSKW claimed was owed by 3PEA to PSKW. The parties each denied liability, and entered into a Settlement Agreement and Release on October 2, 2015 whereby 3PEA agreed to pay $2,500,000 to PSKW in full settlement of the Action. The settlement amount is payable by an initial payment of $1,000,000 no later than October 7, 2015, which was paid in October 2015, with the balance of $1,500,000 being payable in equal monthly installments over 18 months with interest at 3% per annum commencing on November 1, 2015. The Court dismissed the Action with prejudice, but retained jurisdiction to enforce the Settlement Agreement. 3Pea Technologies, Inc., a wholly-owned subsidiary of 3PEA, guaranteed the amount due under the Settlement Agreement. The Company accrued and expensed the entire $2,500,000 settlement as of September 30, 2015 since the principal terms of the Settlement Agreement had been agreed to as of that date.