Potentially, yes. Buying a physical vending machine does not prevent the overall deal from being an investment security.
That is the surprisingly strong legal theory behind a new Florida lawsuit against DFY Vending LLC and its CEO, Alexander “Ben” Pirrie.
Matthew and Laura Labovich of Maryland allege they paid $135,000 for five NekoDrop vending machines under a “done for you” arrangement in which DFY would perform much of the work necessary to make the machines profitable. According to the complaint as reviewed by Boca Post, the agreement called for DFY to receive 31% of gross revenue, while the couple alleges only two of the five machines were ultimately installed. They are asking a Palm Beach County court to treat the arrangement as an unregistered investment contract and rescind the sale. DFY and Pirrie had not filed an answer as of August 31, 2026, according to the latest published docket reporting. The allegations have not been proven.
At first glance, calling vending machines “securities” sounds like creative lawyering.
It is not.
The Supreme Court’s foundational investment-contract case involved actual Florida citrus-grove land sold together with management services. The Eleventh Circuit later confronted an even closer example involving ice-vending machines whose promoter found locations, serviced machines and accounted for proceeds. Another major securities case involved payphones sold to purchasers and then managed by the promoter.
Those precedents give the Laboviches a serious argument.
But there is also a major wrinkle that has received almost no attention: because this lawsuit is brought under Florida securities law in Palm Beach County, an older line of Florida Fourth District Court of Appeal cases applies a more demanding conception of the required “common enterprise” than the federal Eleventh Circuit does.
That may ultimately be the plaintiffs’ hardest problem.
What the DFY Vending lawsuit actually alleges
The case is Labovich v. Pirrie, No. 50-2026-CA-009608-XXXA-MB, filed August 25, 2026, in Palm Beach County Circuit Court.
According to the complaint reviewed by Boca Post, a DFY representative approached Laura Labovich in December 2025 about NekoDrop machines and allegedly described the offering as a “white glove service.” The plaintiffs say they were told they had to purchase at least five machines and that DFY would effectively handle the business while their own obligations would include expenses such as rent, inventory, insurance and Wi-Fi.
The complaint says Pirrie participated in another call on December 17 and explained that DFY’s 31% royalty aligned the company’s financial interest with the machines’ performance.
On December 30, the couple signed a Vending Services Agreement. According to the copy described in the court filing, five Neko Drop machines cost $27,000 each, totaling $135,000. DFY was to receive 31% of gross revenue, and an annexure allegedly provided for a minimum $2,500 net result on a cumulative 90-day average or a full refund.
The plaintiffs allege DFY ultimately installed only two machines, both at shopping malls, while they continued paying expenses associated with those locations. They say the remaining three machines were never installed.
The complaint further alleges that Pirrie emailed customers on July 22 saying DFY was winding down because the venture was no longer financially viable. The plaintiffs claim DFY’s financial condition had not been disclosed when they entered the transaction months earlier.
They brought two claims.
The first seeks rescission under Florida securities law on the theory that the vending arrangement was an investment contract sold without registration or an applicable exemption.
The second alleges common-law fraud in the inducement.
Those are allegations, not findings. No court has ruled that DFY sold a security, committed fraud or violated Florida law.
Why buying an actual vending machine does not answer the securities question
The mistake is assuming a security must look like a stock certificate, bond or cryptocurrency token.
It does not.
Florida’s current securities statute expressly includes an “investment contract” within the definition of a security. Federal securities law uses the same concept.
The modern test comes from the Supreme Court’s 1946 decision in SEC v. W.J. Howey Co.
And Howey itself involved tangible property.
The promoters sold buyers small portions of Florida citrus groves together with service agreements under which an affiliated company cultivated the trees, harvested the fruit and marketed the crop. Many buyers lived elsewhere and lacked the equipment or expertise to operate citrus groves themselves.
The Supreme Court looked at the economic reality of the entire arrangement, rather than isolating the land deed from the management contract. It concluded that the package was an investment contract. It specifically rejected the idea that the existence of property with independent physical value prevented securities law from applying.
That principle matters enormously here.
The legal question is not:
Did the Laboviches purchase vending machines?
They apparently did.
The question is:
What economic arrangement were they purchasing along with those machines?
If a customer buys a machine, finds a location, negotiates the placement, chooses products, stocks it, sets prices, maintains it and bears responsibility for making it profitable, that looks like operating an ordinary vending business.
But if the customer primarily supplies capital while the seller supplies the locations, expertise, management system and critical decisions upon which profitability depends, the transaction begins looking considerably more like an investment contract.
The label attached to it does not decide the issue.
There is already an Eleventh Circuit case involving vending machines
The most important precedent may be Albanese v. Florida National Bank of Orlando, decided by the U.S. Court of Appeals for the Eleventh Circuit in 1987.
The case involved people who purchased commercial ice-vending machines from a company called Polar Chips International, or PCI.
PCI did considerably more than sell equipment. Depending on the agreement, it arranged locations at hotels, motels and other institutions, contracted with those locations, serviced machines, collected proceeds and provided accounting. Some purchasers technically retained rights over where their machines would be placed or relocated.
The lower court concluded that this retained authority meant the owners maintained enough control that the arrangement was not a security.
The Eleventh Circuit disagreed.
The court found that the location rights were much less meaningful in practice than they appeared on paper. Purchasers generally had to choose among locations PCI had procured, and even when an owner suggested another site, that owner still depended on PCI’s expertise and labor to secure it.
More broadly, PCI provided the expertise necessary to obtain locations, contract with businesses, service the equipment and manage the operation. The appellate court concluded that the control supposedly retained by investors was too insubstantial—and in important respects too unrealistic—to take the arrangements outside securities law.
That is unusually relevant to DFY.
An important warning about the comparison
Albanese arose from a far more extreme factual situation. The record showed that many of the purported ice machines did not exist and that money from later purchasers had been used to pay earlier investors.
There is no basis to infer from that case that DFY Vending engaged in the same conduct.
The relevance of Albanese is much narrower: the Eleventh Circuit already confronted the argument that someone who owns a physical vending machine cannot be a passive securities investor because the contract gives that person some theoretical control.
The answer was that courts must examine whether the control is real and economically meaningful.
That principle could matter substantially in the DFY case.
The Supreme Court confronted a similar problem with payphones
The comparison becomes even stronger with SEC v. Edwards and the subsequent Eleventh Circuit proceedings involving ETS Payphones.
ETS sold payphones to purchasers, most of whom leased the phones back for management. The promoter handled placement, collection and maintenance while purchasers expected returns from the arrangement.
The Supreme Court addressed one major question in 2004: whether a promised fixed return could qualify as “profits” for purposes of an investment contract.
It could.
After the Supreme Court sent the case back, the Eleventh Circuit found the SEC had made a sufficient preliminary showing of a common enterprise and dependence on the promoter’s essential managerial efforts. The court emphasized how little practical control investors retained and, specifically, the promoter’s control over phone placement, collections and maintenance.
Again, the point is not that payphones and NekoDrop machines are legally identical.
The point is that physical equipment ownership, standing alone, tells us remarkably little about whether the broader economic arrangement is an investment contract.
How the alleged DFY deal measures against the investment-contract test
Courts commonly break the Howey inquiry into four questions.
| Question | What the public record currently shows | Assessment |
|---|---|---|
| Was money invested? | The plaintiffs allegedly paid $135,000 for five machines and associated services. | If proven, this element appears straightforward. |
| Was there an expectation of profit? | The complaint describes a revenue-producing arrangement and a minimum-performance/refund provision. DFY-branded marketing also repeatedly uses investment, passive-income and returns language. | Plaintiffs have substantial evidence for this element. |
| Were profits expected primarily from the important efforts of others? | Plaintiffs allege a “done for you” structure; DFY allegedly handled crucial location and management functions. But purchasers also bore some operating obligations. | Strong but fact-dependent plaintiffs’ argument. |
| Was there a common enterprise? | DFY publicly marketed a standardized model to multiple “investors,” but the public record does not yet show precisely how different purchasers’ economic fortunes were connected. | Potentially the most difficult Florida-law issue. |
The investment-of-money element is probably the easy part
If the alleged $135,000 payment is established, there is little mystery about whether money was invested.
That does not mean a security existed. People invest money in ordinary businesses every day without buying securities.
The real fight begins with what purchasers expected in return and whose efforts were supposed to produce it.
The expectation-of-profit evidence is significant
The plaintiffs’ own alleged sales conversations matter, as will the complete contract and any contemporaneous marketing they actually received.
But DFY-branded public marketing also provides useful context.
A DFY Vending webpage currently describes the offering as “Truly Passive Income” and a “Done-for-You Vending Investment.” It says DFY handles site analysis, strategic placement, installation and lease negotiation, while referring repeatedly to buyers as “investors” and describing the resulting business as “hands-off.”
That terminology does not magically transform a vending machine into a security.
Companies routinely use the word “investment” in its everyday sense: a house is an investment; a truck can be a business investment.
But the marketing language becomes much more legally significant when combined with promises about who is expected to perform the economically important work.
There is also countervailing material.
DFY’s current earnings disclaimer says income is not guaranteed and expressly states that “passive income” does not mean zero effort. It lists owner responsibilities including restocking, maintenance, monitoring sales, making product and pricing decisions, communicating with locations and dealing with technical issues.
That evidence matters too.
The ultimate question will not be settled by whichever webpage contains the most favorable adjective. A court would look at the contract, sales representations and actual operation of the program.
There is also an entity distinction worth noting: the current website’s earnings disclaimer identifies its operator as DFY Vending Solutions LLC, while the Florida lawsuit names DFY Vending LLC. The website therefore documents current DFY-branded public marketing; it does not by itself prove which specific webpages the Laboviches saw or that every statement on the present site formed part of their December 2025 agreement.
The crucial question is who actually controlled the profit-making work
This may be where the plaintiffs have their most intuitive case.
A vending-machine owner’s activity can range from almost entirely hands-on to almost entirely capital-based.
Consider the tasks that actually determine whether a machine makes money:
| Function | Why it matters to the security analysis |
|---|---|
| Selecting the city and location | Foot traffic can make or break vending economics. |
| Securing and negotiating the site | Without a viable placement, the machine produces nothing. |
| Choosing the machine and business concept | Determines products, margins and customer demand. |
| Installation and setup | Determines when revenue generation can begin. |
| Product selection and pricing | Directly affects margin and sales volume. |
| Restocking | Essential recurring operating labor. |
| Maintenance and technical service | Keeps the revenue-producing asset operating. |
| Sales monitoring and optimization | Can materially alter performance. |
| Collecting/accounting for revenue | Relevant to actual managerial control. |
| Relocating an underperforming machine | Potentially one of the most consequential entrepreneurial decisions. |
The court should care less about whether purchasers performed some tasks than about whether the seller performed the essential entrepreneurial and managerial tasks that determined success or failure.
That distinction is well established.
In Le Chateau Royal Corp. v. Pantaleo, a Florida appellate court rejected an overly literal reading of Howey‘s phrase “solely from the efforts of others.” The relevant inquiry was whether the efforts supplied by people other than the investor were the significant ones compared with what the investor did.
And the Eleventh Circuit’s Albanese decision shows how even contractual rights can prove insufficient when an investor lacks a realistic alternative to relying on the promoter.
That makes one factual question particularly important in the DFY case:
Could the Laboviches realistically operate these businesses without DFY?
If they could freely take possession of the machines, secure substitute locations, hire another operator, negotiate their own agreements, choose products and prices, and manage profitability independently, the transaction looks more like an ordinary business plus a service contract.
If the machines were economically useful to the purchasers only as components of DFY’s location-placement and management system, the security argument becomes substantially stronger.
There is also precedent going the other way
Not every packaged small-business opportunity becomes a security merely because the seller provides assistance.
In Villeneuve v. Advanced Business Concepts Corp., the Eleventh Circuit considered a program involving self-watering flower planters. The purchaser received planters and a display at an established retail store but was required to periodically check and restock the display.
The court concluded that the expected profits were not sufficiently derived from the promoter’s entrepreneurial or managerial efforts and held that the arrangement was not an investment contract.
That case illustrates the other side of the line.
A buyer who must materially operate the enterprise is not transformed into a passive investor just because another company supplied the initial business concept, equipment, locations or support.
The precise division of labor in the DFY program therefore matters enormously.
The biggest unresolved issue may be Florida’s “common enterprise” requirement
This is where the DFY case becomes more complicated than most summaries of the Howey test suggest.
Under federal Eleventh Circuit law, courts use a relatively broad form of “vertical commonality.” In the ETS Payphones litigation, the court explained that a common enterprise may exist where investors depend on a promoter’s expertise or efforts for their returns.
If that were the only rule that mattered, the alleged dependence on DFY could potentially carry considerable weight.
But this case was filed under Florida securities law in Palm Beach County Circuit Court.
Palm Beach County lies within Florida’s Fifteenth Judicial Circuit, whose appeals go to the Fourth District Court of Appeal.
And that court has developed a more particular rule.
In Brown v. Rairigh, the Fourth District considered an investor who purchased a 10% interest in five racehorses. The promoter retained custody and performed the actual work of training, caring for and racing them.
Money was clearly invested. The investor was clearly relying on someone else’s efforts.
But the court still found no investment contract because it concluded there was no sufficiently common enterprise.
The Fourth District rejected the idea that any one-on-one arrangement between a promoter and an investor becomes “common” merely because both parties benefit from success. It required more than one investor plus some interaction among investors, or circumstances showing that the enterprise’s success depended on obtaining a number of investors.
The same court applied that principle again in Le Chateau Royal. It called common enterprise the “more serious” issue and held that the evidence was insufficient where the necessary relationship among multiple investors—or dependence upon attracting them—had not been established.
That is potentially critical here.
DFY’s public marketing plainly contemplates numerous purchasers. The company’s website speaks about “investors,” portfolios and hundreds of machine deployments.
But having many customers is not necessarily the same thing as having a legally common enterprise.
Suppose five NekoDrop machines belonging to one purchaser succeed or fail entirely independently of five machines belonging to another purchaser. Each owner pays DFY a percentage of revenue from that owner’s machines, while no customer’s return depends on anyone else’s purchase.
That could strengthen an argument against common enterprise under Florida’s Fourth District precedent.
Conversely, suppose discovery shows that DFY’s broader system—location procurement, operating infrastructure, personnel, economics or ability to perform its obligations—depended upon continually bringing multiple purchasers into one scalable platform.
That would strengthen the plaintiffs’ common-enterprise argument.
At this stage, the public record does not answer that question.
It may be the single most important unresolved securities issue in the case.
So which side has the stronger investment-contract argument right now?
Based on the public record, the plaintiffs’ theory is legally credible and considerably stronger than “vending machines can’t be securities” would suggest.
The physical-asset objection is particularly weak. Howey, Albanese and the ETS Payphones litigation all demonstrate that tangible assets bundled with promoter-controlled management can fall within securities law.
The plaintiffs also appear to have meaningful facts supporting an expectation of profit and reliance on DFY’s managerial efforts, assuming their account of the sales process and contract is accurate.
The common-enterprise requirement is less certain.
That uncertainty is not a minor technicality. Under the Fourth District’s interpretation of Florida securities law, it could be decisive.
The strongest evidence would therefore not be another screenshot using the phrase “passive income.” It would be evidence showing how DFY’s overall economic system functioned across customers.
Calling the package a “business opportunity” would not necessarily settle the issue either
There is another reason this legal boundary is so interesting: vending-machine packages are also specifically contemplated by business-opportunity laws.
Florida’s Sale of Business Opportunities Act defines covered arrangements in part by reference to sellers who provide or help find locations for vending machines and similar equipment, subject to the statute’s other requirements and exclusions.
At the federal level, the FTC’s Business Opportunity Rule likewise expressly covers qualifying arrangements where a purchaser pays to enter a new business and the seller represents that it will provide locations for vending machines or similar equipment owned, leased, controlled or paid for by the purchaser.
Covered sellers can face significant disclosure requirements. The FTC rule generally requires a prescribed disclosure document before the buyer signs or pays, and Florida’s statute contains its own disclosure and contract requirements for covered transactions.
That does not establish that DFY violated either business-opportunity regime. The applicability of exemptions, jurisdictional provisions and the actual disclosures supplied would have to be examined separately, and the Labovich complaint as reported does not assert that claim.
But it exposes a false choice that often appears in discussions of these deals:
“It was a business opportunity, not a security.”
Those are classifications under different regulatory frameworks. A transaction can raise questions under business-opportunity law without automatically being excluded from securities analysis.
The economic substance still controls the investment-contract question.
Would being a security automatically mean DFY broke the law?
No.
This distinction is important.
Florida law currently makes it unlawful to sell or offer a security within the state unless the security is registered, is federally covered, or falls within an applicable security or transaction exemption.
So there are at least two separate questions:
First: Was the DFY arrangement actually a security?
Second: If it was, was the transaction properly registered or exempt?
The plaintiffs allege that it was an unregistered and nonexempt security. That allegation has not yet been adjudicated.
Florida law provides a rescission remedy for certain sales made in violation of Section 517.07, which explains why classifying the $135,000 arrangement as a security could have major consequences for the plaintiffs’ effort to recover their money.
Security does not mean fraud, either.
An investment contract can be completely legitimate and still qualify as a security. Registration and disclosure requirements exist precisely because many lawful businesses raise capital through securities.
The fraud claim in the Labovich complaint is a separate allegation that will require its own proof.
Does the lawsuit prove DFY Vending was a scam?
No.
A civil complaint records what plaintiffs allege and what they believe they can prove. It is not a judicial finding that those allegations are true.
As of August 31, Vending Times reported that neither DFY nor Pirrie had filed a response. The defendants therefore have not yet put their factual or legal position into the court record covered by the available reporting.
The complaint also alleges that only two of five machines were installed and that Pirrie later told customers the venture was no longer financially viable. Those allegations may be highly relevant to the contract and fraud claims, but they do not themselves establish that DFY was selling securities.
Likewise, Vending Times reports that MicVend LLC filed a separate lawsuit against DFY in Dallas on August 6. The publication said details were not immediately available. Without the underlying allegations, the existence of that case should not be treated as evidence supporting the Laboviches’ claims.
What evidence will probably decide whether this was really a security?
The most consequential evidence is likely to be remarkably practical.
A court will need to know what the complete Vending Services Agreement actually obligated each side to do; who obtained and controlled machine locations; who negotiated leases; who selected products and prices; who stocked and repaired machines; who controlled relocations; whether owners could realistically replace DFY with another manager; how revenue moved between the parties; how the 31% royalty operated; and whether the profitability or viability of DFY’s wider system depended upon a continuing network of purchasers.
Those facts can reveal whether the Laboviches purchased something closer to:
a vending business that they were expected to operate,
or
a capital investment whose success depended predominantly on DFY operating the economic machinery around their physical machines.
That is the real dividing line.
Bottom line
A “done-for-you” vending-machine package can be an investment security. There is unusually relevant precedent showing exactly that kind of transformation from physical equipment into an investment contract.
The new case against DFY Vending is therefore not based on the fanciful idea that every vending machine is somehow a stock.
It is based on the much narrower proposition that the machine, management agreement, location service, revenue arrangement and sales pitch must be examined as one economic package.
If the Laboviches’ allegations are accurate, they appear to have a substantial argument that they supplied the money while DFY was expected to provide many of the managerial efforts on which profits depended. Howey, Albanese and the payphone cases make clear that ownership of tangible property does not defeat that theory.
But the case is not decided.
Under Florida Fourth District precedent, the plaintiffs may also have to establish something existing coverage has largely overlooked: a genuine common enterprise, rather than merely five machines, two contracting parties and a management relationship.
That could depend on facts that have not yet emerged publicly.
For now, the most defensible conclusion is:
The DFY securities claim is legally plausible and stronger than it initially sounds. The physical vending machines are not the major obstacle. The unanswered question is whether the alleged “done-for-you” system was sufficiently promoter-dependent—and sufficiently common across investors—to cross the line from a managed small business into an investment contract.
References and Further Reading
Court filing and current case status
Boca Post — Maryland Couple Sues DFY Vending and Boca Raton CEO Over $135,000 Vending Machine Deal — Complaint-based local reporting that provides the case number, parties, alleged sales representations, contract figures, revenue share, installation allegations, July wind-down email and causes of action. Boca Post states that it reviewed the August 25 complaint and its exhibits.
Palm Beach County Clerk — eCaseView Court Records Search — Official Palm Beach County court-record system where readers can search Case No. 50-2026-CA-009608-XXXA-MB and review available filings as the case develops.
Vending Times — Maryland Couple Sues DFY Vending Over $135K Vending Machine Deal — Industry reporting published August 31, 2026 confirming that no defense response had been filed as of publication and noting the separate MicVend litigation without supplying its underlying allegations.
Primary securities law
Florida Statutes § 517.021 — Definition of “Security” — Current Florida statutory definition expressly including an “investment contract.”
Florida Statutes § 517.07 — Registration of Securities — Current rule governing the sale or offer of securities in Florida and the registration, federal-covered-security and exemption alternatives.
Florida Statutes § 517.211 — Private Remedies for Unlawful Sales — Florida’s statutory rescission and damages framework relevant to the remedy sought by the Laboviches.
Investment-contract cases
SEC v. W.J. Howey Co., 328 U.S. 293 (1946) — The foundational Supreme Court investment-contract case. Particularly relevant because the transaction itself bundled physical citrus-grove property with promoter-provided management services.
Albanese v. Florida National Bank of Orlando, 823 F.2d 408 (11th Cir. 1987) — The unusually close ice-vending-machine precedent addressing location selection, servicing, accounting and whether purchasers’ nominal control was economically meaningful.
SEC v. ETS Payphones, Inc., 408 F.3d 727 (11th Cir. 2005) — The post-Edwards Eleventh Circuit decision examining promoter-managed payphones, broad vertical commonality and essential managerial efforts.
Villeneuve v. Advanced Business Concepts Corp., 730 F.2d 1403 (11th Cir. 1984) — Useful counterexample in which a packaged small-business arrangement involving flower-planter displays was held not to be an investment contract because profits were not sufficiently attributable to the promoter’s managerial efforts.
Brown v. Rairigh, 363 So.2d 590 (Fla. 4th DCA 1978) — Important Florida Fourth District precedent requiring more than a merely bilateral promoter-investor relationship to establish a common enterprise.
Le Chateau Royal Corp. v. Pantaleo, 370 So.2d 1155 (Fla. 4th DCA 1979) — Applies Brown‘s common-enterprise requirement while also explaining that an investor may perform some work without defeating the “efforts of others” element.
Florida Fourth District Court of Appeal — Jurisdiction — Official court source confirming that appeals from the Fifteenth Judicial Circuit, including Palm Beach County, fall within the Fourth District.
Business-opportunity law and DFY marketing
Florida Statutes § 559.801 — Sale of Business Opportunities Act Definitions — Notable because Florida’s definition expressly addresses certain arrangements involving assistance locating vending machines.
eCFR 16 CFR § 437.1 — Federal Business Opportunity Rule Definitions — Current federal regulation expressly addressing qualifying business opportunities involving seller-provided vending-machine locations.
Federal Trade Commission — Business Opportunity Rule Consumer Guidance — Explains federal disclosure requirements, including disclosures relating to earnings claims and purchaser references.
DFY Vending — Passive Income / Done-for-You Vending Investment Page — Interested-party source documenting current DFY-branded descriptions of the model as turnkey, passive, hands-off and intended for “investors.” It should be read as company marketing, not independent evidence of financial performance.
DFY Vending — Earnings Disclaimer — Important countervailing company material stating that income is not guaranteed and that vending ownership still requires activities including restocking, maintenance, monitoring and product/pricing decisions.
Editorial currency note: This article reflects statutes, publicly accessible marketing and reported court status checked through August 31, 2026. The lawsuit is newly filed, and a defense answer, motion to dismiss, amended complaint, court ruling or additional contract evidence could materially change the analysis. The current DFY website may also change; relevant marketing pages should be archived at publication.
