Linley Investments et al v. Jerry Jamgotchian, No. 2:2011cv00724 - Document 193 (C.D. Cal. 2019)
Court Description: ORDER ACCEPTING FINDINGS AND RECOMMENDATIONS OF UNITED STATES MAGISTRATE JUDGE RE PETITIONERS MOTION FOR AN ASSIGNMENT ORDER (DKT. 139) by Judge John A. Kronstadt: See order for details. (shb)
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Linley Investments et al v. Jerry Jamgotchian Doc. 193 1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT 8 CENTRAL DISTRICT OF CALIFORNIA 9 10 11 12 13 14 15 16 17 LINLEY INVESTMENTS, an Isle of Man Limited Company; ORPENDALE, Incorporated in the Republic of Ireland; LYNCH BAGES LIMITED, Incorporated in the Republic of Ireland; WYNATT, Incorporated in the Republic of Ireland; CHELSTON (IRELAND), Incorporated in the Republic of Ireland; and SPRINGCON, Incorporated in the Republic of Ireland, 18 Case No. 2:11-cv-00724-JAK-(AFMx) ORDER ACCEPTING FINDINGS AND RECOMMENDATIONS OF UNITED STATES MAGISTRATE JUDGE RE PETITIONERS’ MOTION FOR AN ASSIGNMENT ORDER (DKT. 139) Petitioners, 19 20 21 22 23 v. JERRY JAMGOTCHIAN, an individual, Respondent. 24 25 Pursuant to 28 U.S.C. § 636, the Court has reviewed the Report and 26 Recommendation of United States Magistrate Judge. Further, the Court has engaged 27 in a de novo review of those portions of the Report to which Respondent has objected. 28 Respondent raises two arguments in his objection. Neither has merit. Dockets.Justia.com 1 First, Respondent contends that the Magistrate Judge erred in denying his 2 request to continue the hearing on the assignment motion. After reviewing the 3 circumstances prior to and during the hearing, the Court concludes that the Magistrate 4 Judge did not abuse his discretion in denying the continuance, particularly where 5 Respondent would not agree to maintain the status quo during the period of any 6 continuance. In any event, through his objection to the Report and Recommendation, 7 Respondent and his recently retained counsel have had a full and fair opportunity to 8 oppose the assignment motion. 9 Second, Respondent contends that a “springing pledge” was created when he 10 and Preferred Bank entered into an “Assignment and Security Interest (Distribution 11 Agreement)” on February 1, 2019. In this Agreement, which was effective as of the 12 satisfaction of the judgment in the Caswell state court case, Respondent purported to 13 assign to Preferred Bank his rights to receive profit distributions from his ownership 14 of shares in three companies. These are rights and distributions that are also the 15 subject of the assignment order sought by Petitioner here. Relying on Brown v. 16 Superior Court, 116 Cal. App. 4th 320 (2004), Respondent argues that entry of the 17 assignment order should be delayed until the priority of any interest granted by him 18 in favor of Preferred Bank is resolved. The Court declines to delay entry of the order 19 on this basis. The lawyer in Brown actively asserted the priority of his lien. In 20 contrast, Preferred Bank, which has been on notice of these proceedings since at least 21 February 2019, has made no attempt to intervene in this case, assert priority, or 22 otherwise object to entry of the assignment order. In addition, as pointed out by 23 Petitioners, there has been no showing by Preferred Bank that it has perfected an 24 interest in rights to receive distributions from Respondent’s shares in the three 25 companies. Finally, the order in Brown was remanded for the trial court to assess 26 whether it “would promote substantial justice” to apply the proceeds of the lawsuit 27 to satisfy the judgment in question, despite the existence of the attorney’s lien. 116 28 Cal. App. 4th at 337. Here, Respondent’s objection fails to show how justice would 2 1 be promoted by delaying entry of the assignment order. The evidence establishes 2 that Respondent and Preferred Bank entered into their transaction concerning his 3 shares in the three companies only after learning that Petitioners were seeking an 4 order from this Court assigning Respondent’s right to receive distributions from those 5 very same shares. 6 7 Accordingly, the Respondent’s objections are overruled, and the Report and Recommendation of the Magistrate Judge is accepted and adopted. * 8 9 * * IT THEREFORE IS ORDERED that: 10 1. Petitioners’ Motion for an Assignment Order is granted. Dkt. 139. 11 2. Respondent’s right to receive distributions or dividends from shares in 12 the following six Corporations (whether they are held by Jerry Jamgotchian 13 individually or by the Jerry and Patricia Jamgotchian Revocable Living Trust) are 14 assigned to the Petitioners upon completion of the requirements of the assignment 15 order in the Caswell case and until such time as the judgment herein is fully satisfied 16 or this order is amended: 17 (a) Olympic Avenue Ventures, Inc., a California corporation 18 (b) Olympic Avenue Ventures Property, Inc., a California corporation 19 20 (c) Rialto Pockets Property, Inc. 21 (d) El Segundo Plaza I, Inc., a California corporation 22 (e) El Segundo Plaza II, Inc., a California corporation 23 (f) South Bay Fitness, Inc., a California corporation 24 3. Pursuant to CCP § 704.540, a copy of this Order shall be served upon 25 the registered agent for service of process for each of the six Corporations by certified 26 mail, return receipt requested. Upon receipt of such service and completion of the 27 requirements of the assignment order in the Caswell case, each Corporation shall 28 thereafter pay directly to Petitioners or their designee any dividends or distributions 3 1 otherwise payable to Jerry Jamgotchian individually, or to the Jerry and Patricia 2 Jamgotchian Revocable Living Trust, when such right to payment becomes due. 3 Such payments shall continue and shall be applied to the judgment herein until the 4 judgment is fully satisfied or the Order is amended. 5 4. Pursuant to CCP § 708.520(a), Jerry Jamgotchian and any servant, 6 agent, employee or attorney for Jerry Jamgotchian and any person(s) in active concert 7 and participating with Jerry Jamgotchian are restrained from encumbering, 8 transferring, assigning, hypothecating, pledging, converting, disposing or liquidating 9 the shares of stock in the six Corporations giving right to payment of dividends, or 10 otherwise hindering Jerry Jamgotchian or the Jerry and Patricia Jamgotchian 11 Revocable Living Trust’s rights to payment from the six Corporations until the 12 judgment herein is fully satisfied or the Order is amended. 13 14 15 16 17 5. Petitioners shall personally serve this Order upon Respondent forthwith and file a corresponding proof of service. 6. This Assignment Order shall not have any effect on the payments required to be made pursuant to the assignment order in the Caswell case. 7. As required by CCP § 708.520(d): 18 NOTICE TO JUDGMENT DEBTOR FAILURE TO 19 COMPLY WITH THIS ORDER MAY SUBJECT THE 20 JUDGMENT DEBTOR TO BEING HELD IN 21 CONTEMPT OF COURT. 22 23 24 25 26 DATED: April 22, 2019 ____________________________________ JOHN A. KRONSTADT UNITED STATES DISTRICT JUDGE 27 28 4
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