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1 Julian Sarkar (SBN 320436)
SarkarLaw
2 345 Franklin Street ELECTRONICALLY
San Francisco, CA 94102 F I L E D
3 Telephone: (415) 795-8795 Superior Court of California,
County of San Francisco
E-mail: jsarkar@sarkar.law
4 03/04/2020
Attorney for Clerk of the Court
5 General Tso Kitchen, Inc. and Li Cao BY: BOWMAN LIU
Deputy Clerk
6
7
8 SUPERIOR COURT OF CALIFORNIA
9 CITY AND COUNTY OF SAN FRANCISCO
10 CIVIC CENTER COURTHOUSE
11 David Tsao, Case No.: CGC-18-571032
12 Plaintiff; General Tso Kitchen, Inc. and Li Cao’s
Request for Judicial Notice in Support of
13 v. Motion to Consolidate Actions
14 Shubo Wang, Date: April 1, 2020
Time: 9:30 AM
15 Defendant. Dept.: 501
Judge: Charles F. Haines
16 Action Filed: November 1, 2018
Trial Date: Not set for trial
17
San Dong Best Inc., Shubo Wang, Case No.: CGC-19-573988
18
Plaintiffs; Action Filed: February 21, 2019
19 Trial Date: Not set for trial
v.
20
General Tso Kitchen, Inc., Li Cao,
21 David Tsao,
22 Defendants.
23
24 …
25 …
26 …
27 …
28 …
1
General Tso Kitchen, Inc. and Li Cao’s Request for Judicial Notice in Support of Motion to Consolidate Actions
1 General Tso Kitchen, Inc., Li Cao, Case No.: CGC-19-573988
2 Cross-Complainants; Action Filed: March 28, 2019
Trial Date: Not set for trial
3 v.
4 San Dong Best Inc., Shubo Wang,
David Tsao, Hua May Tax Services
5 dba Chinese American Associates,
Edmund Ko, Fung Ming Ng, Jing Hua
6 Gao, HM Tax Services,
7 Defendants.
8
David Tsao, Case No.: CUD-19-664145
9
Plaintiff; Action Filed: February 25, 2019
10 Trial Date: Not set for trial
v.
11
General Tso Kitchen, Inc.,
12
Defendant.
13
14 David Tsao, Case No.: CUD-19-665547
15 Plaintiff; Action Filed: August 21, 2019
Trial Date: Not set for trial
16 v.
17 General Tso Kitchen, Inc.,
18 Defendant.
19
20 To all parties and their counsel of record:
21 Please take notice that General Tso Kitchen, Inc. and Li Cao (“Mrs. Cao/GTK”), through
22 their attorney of record, respectfully requests that this Court take judicial notice of the
23 documents listed below in support of its motion for an order consolidating cases David Tsao v.
24 Shubo Wang, Case No. CGC-18-571032, San Dong Best Inc., et al. v. General Tso Kitchen, Inc., et
25 al., Case No. CGC-19-573988, and related cross-action, and David Tsao v. General Tso Kitchen,
26 Inc., Case No. CUD-19-664547 for all purposes, and consolidating David Tsao v. General Tso
27 Kitchen, Inc., Case No. CUD-19-664145 for pretrial purposes only.
28 …
2
General Tso Kitchen, Inc. and Li Cao’s Request for Judicial Notice in Support of Motion to Consolidate Actions
1 Request for Judicial Notice No. 1:
2 Mrs. Cao/GTK requests that the Court take judicial notice of Exhibit A, the Complaint in
3 David Tsao v. Shubo Wang, Case No. CGC-18-571032.
4 Request for Judicial Notice No. 2:
5 Mrs. Cao/GTK requests that the Court take judicial notice of Exhibit B, the original
6 Complaint in San Dong Best Inc., et al. v. General Tso Kitchen, Inc., et al., Case No. CGC-19-
7 573988.
8 Request for Judicial Notice No. 3:
9 Mrs. Cao/GTK requests that the Court take judicial notice of Exhibit C, the Third
10 Amended Complaint in San Dong Best Inc., et al. v. General Tso Kitchen, Inc., et al., and related
11 cross-action, Case No. CGC-19-573988.
12 Request for Judicial Notice No. 4:
13 Mrs. Cao/GTK requests that the Court take judicial notice of Exhibit D, the Second
14 Amended Cross-Complaint in San Dong Best Inc., et al. v. General Tso Kitchen, Inc., et al., and
15 related cross-action, Case No. CGC-19-573988.
16 Request for Judicial Notice No. 5:
17 Mrs. Cao/GTK requests that the Court take judicial notice of Exhibit E, the verified
18 unlawful detainer Complaint in David Tsao v. General Tso Kitchen, Inc., Case No. CUD-19-
19 664145.
20 Request for Judicial Notice No. 6:
21 Mrs. Cao/GTK requests that the Court take judicial notice of Exhibit F, the verified
22 unlawful detainer Complaint in David Tsao v. General Tso Kitchen, Inc., Case No. CUD-19-
23 665547.
24
SarkarLaw
25
26
March 4, 2020 ________________________________
27 Julian Sarkar
Attorney for
28 General Tso Kitchen, Inc. and Li Cao
3
General Tso Kitchen, Inc. and Li Cao’s Request for Judicial Notice in Support of Motion to Consolidate Actions
1 Proof of Service
2 I, Julian Sarkar, declare:
3 At the time of service I was over 18 years of age and not a party to this action. My
4 business address is 345 Franklin Street, San Francisco, CA 94102. On March 4, 2020, I served
5 a copy of General Tso Kitchen, Inc. and Li Cao’s Request for Judicial Notice in Support of
6 Motion to Consolidate Actions on the persons below in the manner described below:
7 By electronic service By electronic service By electronic service
Thomas J. LaLanne, Esq. Colleen B. Kelley, Esq. Mark A. Ruiz, Esq.
8 Law Offices of Thomas J. Law Offices of Colleen B. Law Offices of Mark Ruiz
LaLanne Kelley 2764 Spring Street, Suite 1A
9 400 Harbor Drive 212 Laurel St., #203 Redwood City, CA 94063
Sausalito, CA 94965 Santa Cruz, CA 95060 markruizlaw@yahoo.com
10 tom@lalannelaw.com colleenkelleylaw@gmail.com Attorney for Edmund Ko
Attorney for San Dong Best Attorney for David Tsao
11 Inc. and Shubo Wang
12 By United States mail By United States mail
Ira Leshin, Esq. David Tsao
13 Law Offices of Ira Leshin 3739 Geary Blvd.
4040 Civic Center Drive San Francisco, CA 94118
14 Suite 200 In Pro Per
San Rafael, CA 94903
15 Attorney for David Tsao
16
17 The documents served by electronic service were transmitted to the electronic service
18 addresses above.
19 The documents served by United States mail were enclosed in a sealed envelope or
20 package addressed to the persons at the addresses above and deposited with the United States
21 Postal Service, with the postage fully prepaid.
22 I declare under penalty of perjury under the laws of the State of California that the
23 foregoing is true and correct.
24 Executed this 4th day of March, 2020 at San Francisco, California.
25
26
________________________
27 Julian Sarkar
28
Proof of Service
Exhibit A
Exhibit B
Exhibit C
ELECTRONICALLY
F I L E D
Superior Court of California,
County of San Francisco
02/13/2020
Clerk of the Court
BY: EDWARD SANTOS
Deputy Clerk
Exhibit D
1 Julian Sarkar (SBN 320436)
SarkarLaw
2 345 Franklin Street ELECTRONICALLY
San Francisco, CA 94102 F I L E D
3 Telephone: (415) 795-8795 Superior Court of California,
County of San Francisco
E-mail: jsarkar@sarkar.law
4 12/31/2019
Attorney for Defendants/Cross-Complainants Clerk of the Court
5 General Tso Kitchen, Inc. and Li Cao BY: JUDITH NUNEZ
Deputy Clerk
6
7
8 SUPERIOR COURT OF CALIFORNIA
9 CITY AND COUNTY OF SAN FRANCISCO
10 CIVIC CENTER COURTHOUSE
11 San Dong Best Inc., Shubo Wang, Case No.: CGC-19-573988
12 Plaintiffs; Defendants/Cross-Complainants General Tso
Kitchen, Inc. and Li Cao Second Amended
13 v. Cross-Complaint
14 General Tso Kitchen, Inc., Li Cao, 1. Breach of Contract
David Tsao, 2. California Civil Code section 1950.8
15 3. Fraud and Deceit
Defendants. 4. Unfair Competition Law
16 5. Breach of Covenant of Quiet Enjoyment
17 General Tso Kitchen, Inc., Li Cao,
18 Cross-Complainants;
19 v.
20 San Dong Best Inc., Shubo Wang,
David Tsao, Hua May Tax Services
21 dba Chinese American Associates,
Edmund Ko, Fung Ming Ng, Jing Hua
22 Gao, HM Tax Services, Does 1-100,
inclusive,
23
Cross-Defendants;
24
25 Introduction
26 1. Cross-Complainant General Tso Kitchen, Inc. (“GTK”) is and at all times mentioned herein
27 was a corporation organized under California law with its principal place of business in the City
28 and County of San Francisco in the State of California.
1
Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint
1 2. Cross-Complainant Li Cao (“Mrs. Cao”) is and at all times mentioned herein was an adult
2 resident of the City and County of San Francisco in the State of California.
3 3. Cross-Defendant San Dong Best Inc. (“SDB”) was at all times mentioned herein a corporation
4 organized under California law with its principal place of business in the City and County of
5 San Francisco in the State of California. SDB dissolved on June 22, 2018. SDB is being sued in
6 its capacity under California Corporations Code sections 2010(a) and 2011(a).
7 4. Cross-Defendant Shubo Wang (“Mrs. Wang”) is and at all times mentioned herein was an
8 adult resident of the City and County of San Francisco in the State of California.
9 5. Cross-Defendant David Tsao (“Mr. Tsao”) is and at all times mentioned herein was an adult
10 resident of the City and County of San Francisco in the State of California.
11 6. Cross-Defendant Hua May Tax Services dba Chinese American Associates (“CAA”) was at all
12 times mentioned herein a corporation organized under California law with its principal place
13 of business in the City and County of San Francisco in the State of California. At all times
14 mentioned in the Cross-Complaint Cross-Defendant Hua May Tax Services was engaged under
15 the business name Chinese American Associates. On September 12, 2019, CAA filed for
16 dissolution certifying that it had paid all known debts or liabilities to the extent permissible.
17 CAA and its shareholders are sued in their capacity under California Corporations Code sections
18 2010(a) and 2011(a).
19 7. Cross-Defendant Edmund Ko (“Mr. Ko”) is and at all times mentioned herein was an adult
20 resident of the City and County of San Francisco in the State of California.
21 8. Mr. Ko was a shareholder of CAA upon its September 12, 2019 dissolution.
22 9. Cross-Defendant Fung Ming Ng (“Mr. Ng”) is and at all times mentioned herein was an adult
23 resident of the City and County of San Francisco in the State of California.
24 10. Mr. Ng was a shareholder of CAA upon its September 12, 2019 dissolution.
25 11. Cross-Defendant Jing Hua Gao (“Mr. Gao”) is and at all times mentioned herein was an
26 adult resident of the City and County of San Francisco in the State of California.
27 12. Mr. Gao was a shareholder of CAA upon its September 12, 2019 dissolution.
28 13. Collectively, Mr. Ko, Mr. Ng, and Mr. Gao are described as CAA’s “shareholders” herein.
2
Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint
1 14. Prior to CAA’s September 12, 2019 dissolution, Cross-Defendant HM Tax Services filed for
2 registration as a corporation with the Secretary of State using the exact same street address and
3 suite number as Cross-Defendant Hua May Tax Services (“CAA”) on August 5, 2019. At all times
4 mentioned herein after August 5, 2019, Cross-Defendant HM Tax Services is and was a
5 corporation organized under California law with its principal place of business in the City and
6 County of San Francisco in the State of California.
7 15. Cross-Defendant HM Tax Services is sued herein as the alter ego of Cross-Defendant Hua
8 May Tax Services dba Chinese American Associates (“CAA”), Cross-Defendant Edmund Ko,
9 Cross-Defendant Fung Ming Ng, Cross-Defendant Jing Hua Gao, and Does 6-50.
10 16. There is such a unity of interest and ownership between Cross-Defendant HM Tax Services
11 and Cross-Defendant Hua May Tax Services dba Chinese American Associates (“CAA”), Cross-
12 Defendant Edmund Ko, Cross-Defendant Fung Ming Ng, Cross-Defendant Jing Hua Gao, and
13 Does 6-50 that their separate personalities no longer exist.
14 17. The failure to disregard the corporate entity of Cross-Defendant Hua May Tax Services dba
15 Chinese American Associates (“CAA”) would sanction a fraud or promote injustice.
16 18. GTK and Mrs. Cao are informed and believe, and based thereon allege, that Cross-Defendant
17 HM Tax Services is the alter ego of Cross-Defendant Hua May Tax Services dba Chinese
18 American Associates (“CAA”), Cross-Defendant Edmund Ko, Cross-Defendant Fung Ming Ng,
19 Cross-Defendant Jing Hua Gao, and Does 6 through 50, inclusive, in that they have maintained
20 such a unity of interest and ownership that the separate personalities of the corporate entity
21 and the individual defendants no longer exist and that an inequitable result would follow if
22 they were treated as separate individuals. Upon information and belief, Cross-Defendant Hua
23 May Tax Services dba Chinese American Associates (“CAA”), Cross-Defendant Edmund Ko,
24 Cross-Defendant Fung Ming Ng, and Cross-Defendant Jing Hua Gao, Does 6 through 50 and
25 Cross-Defendant HM Tax Services were engaged in activities rendering the alter ego doctrine
26 applicable.
27 19. On information and belief, the failure of Cross-Defendant HM Tax Services, Cross-
28 Defendant Edmund Ko, Cross-Defendant Fung Ming Ng, Cross-Defendant Jing Hua Gao, and
3
Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint
1 Does 6 through 50 to adequately capitalize Cross-Defendant Hua May Tax Services dba Chinese
2 American Associates (“CAA”) renders the alter ego doctrine applicable.
3 20. On information and belief, the treatment by Cross-Defendant HM Tax Services, Cross-
4 Defendant Edmund Ko, Cross-Defendant Fung Ming Ng, and Cross-Defendant Jing Hua Gao,
5 Does 6 through 50 of Cross-Defendant Hua May Tax Services dba Chinese American Associates
6 (“CAA”) assets as their own renders the alter ego doctrine applicable.
7 21. On information and belief, the failure of Cross-Defendant HM Tax Services, Cross-
8 Defendant Edmund Ko, Cross-Defendant Fung Ming Ng, Cross-Defendant Jing Hua Gao, and
9 Does 6 through 50 to maintain minutes or adequate records renders the alter ego doctrine
10 applicable.
11 22. On information and belief, the disregard of legal formalities by Cross-Defendant HM Tax
12 Services, Cross-Defendant Edmund Ko, Cross-Defendant Fung Ming Ng, Cross-Defendant Jing
13 Hua Gao, and Does 6 through 50 renders the alter ego doctrine applicable.
14 23. On information and belief, the representations that Cross-Defendant Hua May Tax Services
15 dba Chinese American Associates (“CAA”) are personally liable for Cross-Defendant Hua May
16 Tax Services dba Chinese American Associates’ (“CAA”) debts renders the alter ego doctrine
17 applicable.
18 24. On information and belief, the use of Cross-Defendant HM Tax Services as a mere shell,
19 instrumentality, or conduit for a single venture renders the alter ego doctrine applicable.
20 25. Cross-Complainants do not presently know the true names and capacities of Cross-
21 Defendants sued herein as Does 1 through 100, inclusive. Cross-Complainants will seek leave
22 of court to amend this Complaint to allege Cross-Defendants true names and capacities as soon
23 as Cross-Complainants ascertain them.
24 26. At all relevant times herein, Mrs. Cao could not competently speak or read in the English
25 language. Mrs. Cao’s native language is Chinese.
26 27. GTK & Mrs. Cao negotiated in the Chinese language an agreement with Mr. Tsao, SDB &
27 Mrs. Wang for a lease agreement for the premises located at 3741 Geary Boulevard, San
28 Francisco, California (the “premises”), the purchase of SDB, and the corresponding rights to
4
Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint
1 operate a restaurant on the premises.
2 28. Mr. Tsao uses the structure where the premises are located for permanent residential use.
3 29. At all relevant times herein, SDB & Mrs. Wang acted with malice or the intent to defraud
4 GTK & Mrs. Cao.
5 30. During these negotiations, SDB & Mrs. Wang misrepresented to GTK & Mrs. Cao the
6 monthly rent she was paying under her lease agreement was $6,100, when in fact it was $5,000.
7 31. During these negotiations, Mr. Tsao claimed he did not have a copy of his lease agreement
8 with SDB & Mrs. Wang to show GTK & Mrs. Cao. Mr. Tsao affirmed SDB & Mrs. Wang’s
9 misrepresentation that the monthly rent she was paying under her lease agreement was $6,100,
10 when in fact it was $5,000.
11 32. SDB & Mrs. Wang orally represented to GTK & Mrs. Cao that SDB & Mrs. Wang would
12 reimburse GTK & Mrs. Cao for any repairs that needed to be made to the equipment and fixtures
13 after GTK & Mrs. Cao took possession of the premises.
14 33. At all times relevant herein, CAA and its shareholders were not authorized to practice law
15 in the State of California, nor were they authorized to perform escrow services other than real
16 estate escrows where the licensed realtor represents a party to the transaction.
17 34. In exchange for payment of at least $690 from SDB and at least $2,140 from GTK, CAA and
18 its shareholders prepared a written agreement for the transaction negotiated between Mrs.
19 Wang, Mrs. Cao, and Mr. Tsao.
20 35. On or about June 12, 2017, in the City and County of San Francisco in the State of California,
21 Cross-Complainants and SDB & Mrs. Wang entered into the English-language Business Purchase
22 Agreement, a true copy of which is attached to this Complaint as Exhibit A and is incorporated
23 into this Complaint by reference.
24 36. The Business Purchase Agreement stated that CAA and its shareholders represented neither
25 party.
26 37. At no point did GTK or Mrs. Cao receive a Chinese language translation of any of the terms
27 of the Business Purchase Agreement.
28 38. The Business Purchase Agreement obligated SDB & Mrs. Wang to transfer “[t]he fixtures
5
Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint
1 and equipment now on the premises described in Exhibit 1, which is attached to and made a
2 part of this Agreement” to GTK & Mrs. Cao.
3 39. At all relevant times, there was no attachment labeled Exhibit 1 containing any fixtures or
4 equipment.
5 40. The Business Purchase Agreement obligated SDB & Mrs. Wang to transfer the goodwill and
6 trade name of SDB to GTK & Mrs. Cao.
7 41. The Business Purchase Agreement obligated SDB & Mrs. Wang to transfer a beer and wine
8 license to GTK & Mrs. Cao.
9 42. The Business Purchase Agreement obligated GTK & Mrs. Cao to pay SDB & Mrs. Wang
10 $10,000 as consideration for the fixtures and equipment, $30,000 for the goodwill and trade
11 name, $7,000 for the leasehold, and $3,000 for the beer & wine license.
12 43. The Business Purchase Agreement obligated GTK & Mrs. Cao to make these payments
13 totaling $50,000 to Chinese American Associates as the escrow service.
14 44. The Business Purchase Agreement incorporated escrow instructions prepared by Chinese
15 American Associates.
16 45. No escrow instructions were attached to the Business Purchase Agreement, produced upon
17 execution of the agreement, or otherwise provided to the parties.
18 46. As a condition of taking possession of the premises pursuant to the Commercial Lease
19 Agreement, Mr. Tsao, SDB, and Mrs. Wang required GTK & Mrs. Cao to make payments of at
20 least $60,001.88 as key money for the leasehold.
21 47. GTK & Mrs. Cao tendered a check for $50,000 made on their behalf to SDB & Mrs. Wang,
22 as a condition to initiating her lease agreement with Mr. Tsao.
23 48. SDB & Mrs. Wang initially accepted the check, then rejected the check shortly thereafter
24 and demanded $50,000 in cash, citing taxation as a reason for the rejection.
25 49. GTK & Mrs. Cao tendered cash payments totaling $50,000 to SDB & Mrs. Wang, as a
26 condition to initiating their lease agreement with Mr. Tsao.
27 50. Mr. Tsao, SDB, and Mrs. Wang required GTK & Mrs. Cao to make an additional payment of
28 $6,640.94 to Mr. Tsao as a condition of initiating their lease agreement with Mr. Tsao.
6
Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint
1 51. Mr. Tsao, SDB, and Mrs. Wang required GTK & Mrs. Cao to make an additional payment of
2 $3,360.94 to the City and County of San Francisco for a debt obligation as a condition of
3 initiating their lease agreement with Mr. Tsao.
4 52. Mr. Tsao, SDB, and Mrs. Wang required GTK & Mrs. Cao to make an additional payment of
5 $50,000, in escrow by Chinese American Associates.
6 53. GTK & Mrs. Cao made the additional payment of $50,000 to Chinese American Associates
7 in escrow.
8 54. SDB & Mrs. Wang dissolved SDB on June 22, 2018.
9 55. SDB & Mrs. Wang subsequently made an audio recording of herself admitting that she had
10 fraudulently misrepresented the amount of rent she was paying at that time to GTK & Mrs. Cao,
11 demonstrating concern that Mrs. Cao had eventually found out the truth.
12 56. When confronted about the deception, Mr. Tsao claimed that SDB & Mrs. Wang had been
13 paying an additional $1,100 in cash each month, and invited GTK & Mrs. Cao to do the same.
14 57. At no point did SDB or Mrs. Wang transfer the goodwill or trade name of SDB to GTK or
15 Mrs. Cao.
16 58. SDB & Mrs. Wang subsequently brought suit against GTK & Mrs. Cao for breach of contract
17 in the above-captioned matter for the additional $50,000 held by the illegal escrow.
18 59. In the preliminary Chinese language negotiations between GTK & Mrs. Cao with Mr. Tsao,
19 Mr. Tsao represented to Mrs. Cao that she would not have to pay for any utilities or taxes in
20 addition to the rent.
21 60. Mr. Tsao then produced an English-language Commercial Lease Agreement, a true copy of
22 which is attached to this Complaint as Exhibit B. The Commercial Lease Agreement contained
23 an ambiguous, boilerplate clause stating that “property operating expenses” would be shared
24 proportionately. Mr. Tsao left the blank space for affirming and specifying the term empty.
25 61. At Mr. Tsao’s direction, GTK executed the Commercial Lease Agreement.
26 62. As a condition of initiating its tenancy, Mr. Tsao required GTK to make a key money
27 payment of at least $6,640.94.
28 63. GTK satisfied Mr. Tsao’s demand for the key money payment.
7
Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint
1 64. At no point did GTK or Mrs. Cao receive a Chinese language translation of any of the terms
2 of the Commercial Lease Agreement.
3 65. In his Chinese language communications with Mrs. Cao from the inception of her tenancy,
4 Mr. Tsao initially did not indicate that GTK had an obligation to pay “property operating
5 expenses.”
6 66. After causing GTK to rely upon an understanding that she had no obligation to pay “property
7 operating expenses,” Mr. Tsao demanded several months’ worth of “property operating
8 expenses” at once, citing the ambiguous English-language lease provision.
9 67. Throughout the course of GTK’s tenancy, Mr. Tsao entered its rented premises without
10 notice, made persistent threatening communications to GTK, and interfered with its quiet
11 enjoyment.
12 68. GTK made timely payments of rent to Mr. Tsao each month.
13 69. On February 25, 2019, Mr. Tsao filed an unlawful detainer lawsuit against GTK alleging
14 nonpayment of rent.
15 70. In Mr. Tsao’s verified complaint, he states under the penalty of perjury that the total monthly
16 rent owed by GTK is $6,500. That verified statement is unqualified. He also alleges that GTK
17 owes $5,141.50 in rent for the period of June 10, 2018 through December 10, 2018. No factual
18 or legal basis is stated for this allegation in Mr. Tsao’s verified unlawful detainer complaint or
19 its attachments. He seems to have hand-circled the “property operating expenses” clause in the
20 attached lease agreement which he never completed where provided or explained to GTK &
21 Mrs. Cao.
22 71. The fourth paragraph of the Commercial Lease Agreement defines rent as all monetary
23 obligations in that agreement.
24 72. Mr. Tsao required GTK & Mrs. Cao to make payments in addition to rent and place their
25 names in his utility bills to incur those costs.
26 73. At arbitrary times Mr. Tsao has demanded payment for insurance from GTK & Mrs. Cao,
27 but never demonstrated what obligation GTK & Mrs. Cao owed him to contribute to Mr. Tsao’s
28 purported insurance policies. Fearing eviction and the limitation of their English-language
8
Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint
1 capability to enforce their rights, GTK & Mrs. Cao have made such payments in the past despite
2 having no obligation to do so.
3 74. Mr. Tsao is and was an insured of GTK & Mrs. Cao’s insurance policy covering the premises.
4 First Cause of Action
Breach of Contract
5 as to Cross-Defendants SDB Inc., Shubo Wang, David Tsao, and Does 1-5
6 75. GTK & Mrs. Cao incorporate by reference Paragraphs 1 through 74 of this Complaint.
7 76. GTK & Mrs. Cao negotiated the terms of the Business Purchase Agreement with SDB & Mrs.
8 Wang in the Chinese language.
9 77. SDB & Mrs. Wang had GTK & Mrs. Cao execute the English-language Business Purchase
10 Agreement. GTK & Mrs. Cao never received a Chinese translation of the terms of the Business
11 Purchase Agreement as required by California Civil Code section 1632.
12 78. Section 1632 requires that “[a]ny person engaged in a trade or business who negotiates
13 primarily in Spanish, Chinese, Tagalog, Vietnamese, or Korean, orally, or in writing” to provide
14 the other party to an agreement, including a lease, with “a translation of the contract or
15 agreement in the language in which the contract or agreement was negotiated.”
16 79. SDB & Mrs. Wang waived their right to require GTK & Mrs. Cao authorize the illegal escrow
17 service to release funds when SDB & Mrs. Wang refused tender of the $50,000 check.
18 80. SDB & Mrs. Wang accepted full satisfaction of payment when they accepted $50,000 in cash
19 from GTK & Mrs. Cao.
20 81. SDB & Mrs. Wang wrongfully required GTK & Mrs. Cao to make additional payment of
21 $50,000 to the illegal escrow service.
22 82. SDB & Mrs. Wang failed to transfer the fixtures and equipment to GTK & Mrs. Cao as
23 required by the Business Purchase Agreement or reimburse GTK & Mrs. Cao for repairs as had
24 been agreed orally.
25 83. SDB & Mrs. Wang failed to transfer the goodwill and trade name of SDB to GTK & Mrs. Cao
26 as required by the Business Purchase Agreement.
27 84. GTK & Mrs. Cao did not obtain a satisfactory new lease for the premises from Mr. Tsao as
28 required by the Business Purchase Agreement.
9
Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint
1 85. The breach of contract by SDB & Mrs. Wang was a substantial factor in causing harm to
2 GTK & Mrs. Cao.
3 86. GTK & Mrs. Cao negotiated the terms of the Business Purchase Agreement with Mr. Tsao in
4 the Chinese language.
5 87. Mr. Tsao had GTK & Mrs. Cao execute the English-language Commercial Lease Agreement.
6 GTK & Mrs. Cao never received a Chinese translation of the terms of the Commercial Lease
7 Agreement as required by California Civil Code section 1632.
8 88. The fourth paragraph of the Commercial Lease Agreement defines rent as all monetary
9 obligations in that agreement.
10 89. In Mr. Tsao’s verified unlawful detainer complaint, he stated under the penalty of perjury
11 that the total monthly rent owed by GTK is $6,500, and did not expressly identify on the face
12 of the complaint any other obligations owed by GTK.
13 90. Mr. Tsao was not entitled to require GTK & Mrs. Cao to make additional payments and place
14 his utility bills in their names to cause them to incur debts arising from his residential utility
15 usage upstairs.
16 91. Mr. Tsao was not entitled to require GTK & Mrs. Cao to make arbitrary and capricious
17 payments for items including but not limited to insurance policies that have never been
18 identified, especially where Mr. Tsao is an insured of GTK & Mrs. Cao’s insurance policy.
19 92. The breach of contract by Mr. Tsao was a substantial factor in causing harm to GTK & Mrs.
20 Cao.
21 Second Cause of Action
California Civil Code section 1950.8
22 as to Cross-Defendants SDB Inc., Shubo Wang, David Tsao, and Does 1-5
23 93. GTK & Mrs. Cao incorporate by reference Paragraphs 1 through 92 of this Complaint.
24 94. California Civil Code section 1950.8 prohibits any person from requiring, demanding, or
25 causing to make payable any payment of money, including, but not limited to, “key money,”
26 however denominated, as a condition of initiating, continuing, or renewing a lease or rental
27 agreement, unless the amount of payment is stated in the written lease or rental agreement.
28 95. Any person who requires, demands, or causes to make payable any payment in violation of
10
Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint
1 subdivision (a), shall be subject to civil penalty of three times the amount of actual damages
2 proximately suffered by the person seeking to obtain the lease or rental of real property, and
3 the person so damaged shall be entitled to an award of costs, including reasonable attorney’s
4 fees, reasonable incurred in connection with obtaining the civil penalty.
5 96. As a condition of taking possession of the premises pursuant to the Commercial Lease
6 Agreement, Mr. Tsao, SDB, and Mrs. Wang required GTK & Mrs. Cao to make payments of at
7 least $60,001.88 as key money for the leasehold.
8 97. Mr. Tsao, SDB, and Mrs. Wang violated section 1950.8.
9 98. GTK & Mrs. Cao are entitled to a civil penalty of at least $180,005.40, or a greater sum
10 according to proof, and attorney fees, from Mr. Tsao, SDB, and Mrs. Wang.
11 Third Cause of Action
Fraud and Deceit
12 as to All Cross-Defendants
13 99. GTK & Mrs. Cao incorporate by reference Paragraphs 1 through 98 of this Complaint.
14 100. Mr. Tsao, SDB, Mrs. Wang, CAA, CAA’s shareholders, and Does 6-50 falsely represented to
15 GTK & Mrs. Cao that SDB & Mrs. Wang were paying $6,100 in rent for the premises when they
16 were actually paying $5,000 in rent.
17 101. Mr. Tsao, SDB, Mrs. Wang, CAA, CAA’s shareholders, and Does 6-50 knew that the
18 representation was false when they made it, or made the representation recklessly and without
19 regard for its truth.
20 102. Mr. Tsao, SDB, Mrs. Wang, CAA, CAA’s shareholders, and Does 6-50 intended that GTK &
21 Mrs. Cao rely on the representation.
22 103. GTK & Mrs. Cao reasonably relied on the representation by Mr. Tsao, SDB, Mrs. Wang,
23 CAA, CAA’s shareholders, and Does 6-50.
24 104. The reliance by GTK & Mrs. Cao on the representation by Mr. Tsao, SDB, Mrs. Wang, CAA,
25 CAA’s shareholders, and Does 6-50 were substantial factors in causing the harm to GTK & Mrs.
26 Cao.
27 105. Mr. Tsao falsely represented to GTK & Mrs. Cao the amounts due under the Commercial
28 Lease Agreement, and whether the Commercial Lease Agreement required Mrs. Cao to incur
11
Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint
1 Mr. Tsao’s separate utility bills and insurance obligations in addition to her own.
2 106. Mr. Tsao knew his representations were false when he made them, or
Preview
1 Julian Sarkar (SBN 320436) SarkarLaw 2 345 Franklin Street ELECTRONICALLY San Francisco, CA 94102 F I L E D 3 Telephone: (415) 795-8795 Superior Court of California, County of San Francisco E-mail: jsarkar@sarkar.law 4 03/04/2020 Attorney for Clerk of the Court 5 General Tso Kitchen, Inc. and Li Cao BY: BOWMAN LIU Deputy Clerk 6 7 8 SUPERIOR COURT OF CALIFORNIA 9 CITY AND COUNTY OF SAN FRANCISCO 10 CIVIC CENTER COURTHOUSE 11 David Tsao, Case No.: CGC-18-571032 12 Plaintiff; General Tso Kitchen, Inc. and Li Cao’s Request for Judicial Notice in Support of 13 v. Motion to Consolidate Actions 14 Shubo Wang, Date: April 1, 2020 Time: 9:30 AM 15 Defendant. Dept.: 501 Judge: Charles F. Haines 16 Action Filed: November 1, 2018 Trial Date: Not set for trial 17 San Dong Best Inc., Shubo Wang, Case No.: CGC-19-573988 18 Plaintiffs; Action Filed: February 21, 2019 19 Trial Date: Not set for trial v. 20 General Tso Kitchen, Inc., Li Cao, 21 David Tsao, 22 Defendants. 23 24 … 25 … 26 … 27 … 28 … 1 General Tso Kitchen, Inc. and Li Cao’s Request for Judicial Notice in Support of Motion to Consolidate Actions 1 General Tso Kitchen, Inc., Li Cao, Case No.: CGC-19-573988 2 Cross-Complainants; Action Filed: March 28, 2019 Trial Date: Not set for trial 3 v. 4 San Dong Best Inc., Shubo Wang, David Tsao, Hua May Tax Services 5 dba Chinese American Associates, Edmund Ko, Fung Ming Ng, Jing Hua 6 Gao, HM Tax Services, 7 Defendants. 8 David Tsao, Case No.: CUD-19-664145 9 Plaintiff; Action Filed: February 25, 2019 10 Trial Date: Not set for trial v. 11 General Tso Kitchen, Inc., 12 Defendant. 13 14 David Tsao, Case No.: CUD-19-665547 15 Plaintiff; Action Filed: August 21, 2019 Trial Date: Not set for trial 16 v. 17 General Tso Kitchen, Inc., 18 Defendant. 19 20 To all parties and their counsel of record: 21 Please take notice that General Tso Kitchen, Inc. and Li Cao (“Mrs. Cao/GTK”), through 22 their attorney of record, respectfully requests that this Court take judicial notice of the 23 documents listed below in support of its motion for an order consolidating cases David Tsao v. 24 Shubo Wang, Case No. CGC-18-571032, San Dong Best Inc., et al. v. General Tso Kitchen, Inc., et 25 al., Case No. CGC-19-573988, and related cross-action, and David Tsao v. General Tso Kitchen, 26 Inc., Case No. CUD-19-664547 for all purposes, and consolidating David Tsao v. General Tso 27 Kitchen, Inc., Case No. CUD-19-664145 for pretrial purposes only. 28 … 2 General Tso Kitchen, Inc. and Li Cao’s Request for Judicial Notice in Support of Motion to Consolidate Actions 1 Request for Judicial Notice No. 1: 2 Mrs. Cao/GTK requests that the Court take judicial notice of Exhibit A, the Complaint in 3 David Tsao v. Shubo Wang, Case No. CGC-18-571032. 4 Request for Judicial Notice No. 2: 5 Mrs. Cao/GTK requests that the Court take judicial notice of Exhibit B, the original 6 Complaint in San Dong Best Inc., et al. v. General Tso Kitchen, Inc., et al., Case No. CGC-19- 7 573988. 8 Request for Judicial Notice No. 3: 9 Mrs. Cao/GTK requests that the Court take judicial notice of Exhibit C, the Third 10 Amended Complaint in San Dong Best Inc., et al. v. General Tso Kitchen, Inc., et al., and related 11 cross-action, Case No. CGC-19-573988. 12 Request for Judicial Notice No. 4: 13 Mrs. Cao/GTK requests that the Court take judicial notice of Exhibit D, the Second 14 Amended Cross-Complaint in San Dong Best Inc., et al. v. General Tso Kitchen, Inc., et al., and 15 related cross-action, Case No. CGC-19-573988. 16 Request for Judicial Notice No. 5: 17 Mrs. Cao/GTK requests that the Court take judicial notice of Exhibit E, the verified 18 unlawful detainer Complaint in David Tsao v. General Tso Kitchen, Inc., Case No. CUD-19- 19 664145. 20 Request for Judicial Notice No. 6: 21 Mrs. Cao/GTK requests that the Court take judicial notice of Exhibit F, the verified 22 unlawful detainer Complaint in David Tsao v. General Tso Kitchen, Inc., Case No. CUD-19- 23 665547. 24 SarkarLaw 25 26 March 4, 2020 ________________________________ 27 Julian Sarkar Attorney for 28 General Tso Kitchen, Inc. and Li Cao 3 General Tso Kitchen, Inc. and Li Cao’s Request for Judicial Notice in Support of Motion to Consolidate Actions 1 Proof of Service 2 I, Julian Sarkar, declare: 3 At the time of service I was over 18 years of age and not a party to this action. My 4 business address is 345 Franklin Street, San Francisco, CA 94102. On March 4, 2020, I served 5 a copy of General Tso Kitchen, Inc. and Li Cao’s Request for Judicial Notice in Support of 6 Motion to Consolidate Actions on the persons below in the manner described below: 7 By electronic service By electronic service By electronic service Thomas J. LaLanne, Esq. Colleen B. Kelley, Esq. Mark A. Ruiz, Esq. 8 Law Offices of Thomas J. Law Offices of Colleen B. Law Offices of Mark Ruiz LaLanne Kelley 2764 Spring Street, Suite 1A 9 400 Harbor Drive 212 Laurel St., #203 Redwood City, CA 94063 Sausalito, CA 94965 Santa Cruz, CA 95060 markruizlaw@yahoo.com 10 tom@lalannelaw.com colleenkelleylaw@gmail.com Attorney for Edmund Ko Attorney for San Dong Best Attorney for David Tsao 11 Inc. and Shubo Wang 12 By United States mail By United States mail Ira Leshin, Esq. David Tsao 13 Law Offices of Ira Leshin 3739 Geary Blvd. 4040 Civic Center Drive San Francisco, CA 94118 14 Suite 200 In Pro Per San Rafael, CA 94903 15 Attorney for David Tsao 16 17 The documents served by electronic service were transmitted to the electronic service 18 addresses above. 19 The documents served by United States mail were enclosed in a sealed envelope or 20 package addressed to the persons at the addresses above and deposited with the United States 21 Postal Service, with the postage fully prepaid. 22 I declare under penalty of perjury under the laws of the State of California that the 23 foregoing is true and correct. 24 Executed this 4th day of March, 2020 at San Francisco, California. 25 26 ________________________ 27 Julian Sarkar 28 Proof of Service Exhibit A Exhibit B Exhibit C ELECTRONICALLY F I L E D Superior Court of California, County of San Francisco 02/13/2020 Clerk of the Court BY: EDWARD SANTOS Deputy Clerk Exhibit D 1 Julian Sarkar (SBN 320436) SarkarLaw 2 345 Franklin Street ELECTRONICALLY San Francisco, CA 94102 F I L E D 3 Telephone: (415) 795-8795 Superior Court of California, County of San Francisco E-mail: jsarkar@sarkar.law 4 12/31/2019 Attorney for Defendants/Cross-Complainants Clerk of the Court 5 General Tso Kitchen, Inc. and Li Cao BY: JUDITH NUNEZ Deputy Clerk 6 7 8 SUPERIOR COURT OF CALIFORNIA 9 CITY AND COUNTY OF SAN FRANCISCO 10 CIVIC CENTER COURTHOUSE 11 San Dong Best Inc., Shubo Wang, Case No.: CGC-19-573988 12 Plaintiffs; Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended 13 v. Cross-Complaint 14 General Tso Kitchen, Inc., Li Cao, 1. Breach of Contract David Tsao, 2. California Civil Code section 1950.8 15 3. Fraud and Deceit Defendants. 4. Unfair Competition Law 16 5. Breach of Covenant of Quiet Enjoyment 17 General Tso Kitchen, Inc., Li Cao, 18 Cross-Complainants; 19 v. 20 San Dong Best Inc., Shubo Wang, David Tsao, Hua May Tax Services 21 dba Chinese American Associates, Edmund Ko, Fung Ming Ng, Jing Hua 22 Gao, HM Tax Services, Does 1-100, inclusive, 23 Cross-Defendants; 24 25 Introduction 26 1. Cross-Complainant General Tso Kitchen, Inc. (“GTK”) is and at all times mentioned herein 27 was a corporation organized under California law with its principal place of business in the City 28 and County of San Francisco in the State of California. 1 Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint 1 2. Cross-Complainant Li Cao (“Mrs. Cao”) is and at all times mentioned herein was an adult 2 resident of the City and County of San Francisco in the State of California. 3 3. Cross-Defendant San Dong Best Inc. (“SDB”) was at all times mentioned herein a corporation 4 organized under California law with its principal place of business in the City and County of 5 San Francisco in the State of California. SDB dissolved on June 22, 2018. SDB is being sued in 6 its capacity under California Corporations Code sections 2010(a) and 2011(a). 7 4. Cross-Defendant Shubo Wang (“Mrs. Wang”) is and at all times mentioned herein was an 8 adult resident of the City and County of San Francisco in the State of California. 9 5. Cross-Defendant David Tsao (“Mr. Tsao”) is and at all times mentioned herein was an adult 10 resident of the City and County of San Francisco in the State of California. 11 6. Cross-Defendant Hua May Tax Services dba Chinese American Associates (“CAA”) was at all 12 times mentioned herein a corporation organized under California law with its principal place 13 of business in the City and County of San Francisco in the State of California. At all times 14 mentioned in the Cross-Complaint Cross-Defendant Hua May Tax Services was engaged under 15 the business name Chinese American Associates. On September 12, 2019, CAA filed for 16 dissolution certifying that it had paid all known debts or liabilities to the extent permissible. 17 CAA and its shareholders are sued in their capacity under California Corporations Code sections 18 2010(a) and 2011(a). 19 7. Cross-Defendant Edmund Ko (“Mr. Ko”) is and at all times mentioned herein was an adult 20 resident of the City and County of San Francisco in the State of California. 21 8. Mr. Ko was a shareholder of CAA upon its September 12, 2019 dissolution. 22 9. Cross-Defendant Fung Ming Ng (“Mr. Ng”) is and at all times mentioned herein was an adult 23 resident of the City and County of San Francisco in the State of California. 24 10. Mr. Ng was a shareholder of CAA upon its September 12, 2019 dissolution. 25 11. Cross-Defendant Jing Hua Gao (“Mr. Gao”) is and at all times mentioned herein was an 26 adult resident of the City and County of San Francisco in the State of California. 27 12. Mr. Gao was a shareholder of CAA upon its September 12, 2019 dissolution. 28 13. Collectively, Mr. Ko, Mr. Ng, and Mr. Gao are described as CAA’s “shareholders” herein. 2 Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint 1 14. Prior to CAA’s September 12, 2019 dissolution, Cross-Defendant HM Tax Services filed for 2 registration as a corporation with the Secretary of State using the exact same street address and 3 suite number as Cross-Defendant Hua May Tax Services (“CAA”) on August 5, 2019. At all times 4 mentioned herein after August 5, 2019, Cross-Defendant HM Tax Services is and was a 5 corporation organized under California law with its principal place of business in the City and 6 County of San Francisco in the State of California. 7 15. Cross-Defendant HM Tax Services is sued herein as the alter ego of Cross-Defendant Hua 8 May Tax Services dba Chinese American Associates (“CAA”), Cross-Defendant Edmund Ko, 9 Cross-Defendant Fung Ming Ng, Cross-Defendant Jing Hua Gao, and Does 6-50. 10 16. There is such a unity of interest and ownership between Cross-Defendant HM Tax Services 11 and Cross-Defendant Hua May Tax Services dba Chinese American Associates (“CAA”), Cross- 12 Defendant Edmund Ko, Cross-Defendant Fung Ming Ng, Cross-Defendant Jing Hua Gao, and 13 Does 6-50 that their separate personalities no longer exist. 14 17. The failure to disregard the corporate entity of Cross-Defendant Hua May Tax Services dba 15 Chinese American Associates (“CAA”) would sanction a fraud or promote injustice. 16 18. GTK and Mrs. Cao are informed and believe, and based thereon allege, that Cross-Defendant 17 HM Tax Services is the alter ego of Cross-Defendant Hua May Tax Services dba Chinese 18 American Associates (“CAA”), Cross-Defendant Edmund Ko, Cross-Defendant Fung Ming Ng, 19 Cross-Defendant Jing Hua Gao, and Does 6 through 50, inclusive, in that they have maintained 20 such a unity of interest and ownership that the separate personalities of the corporate entity 21 and the individual defendants no longer exist and that an inequitable result would follow if 22 they were treated as separate individuals. Upon information and belief, Cross-Defendant Hua 23 May Tax Services dba Chinese American Associates (“CAA”), Cross-Defendant Edmund Ko, 24 Cross-Defendant Fung Ming Ng, and Cross-Defendant Jing Hua Gao, Does 6 through 50 and 25 Cross-Defendant HM Tax Services were engaged in activities rendering the alter ego doctrine 26 applicable. 27 19. On information and belief, the failure of Cross-Defendant HM Tax Services, Cross- 28 Defendant Edmund Ko, Cross-Defendant Fung Ming Ng, Cross-Defendant Jing Hua Gao, and 3 Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint 1 Does 6 through 50 to adequately capitalize Cross-Defendant Hua May Tax Services dba Chinese 2 American Associates (“CAA”) renders the alter ego doctrine applicable. 3 20. On information and belief, the treatment by Cross-Defendant HM Tax Services, Cross- 4 Defendant Edmund Ko, Cross-Defendant Fung Ming Ng, and Cross-Defendant Jing Hua Gao, 5 Does 6 through 50 of Cross-Defendant Hua May Tax Services dba Chinese American Associates 6 (“CAA”) assets as their own renders the alter ego doctrine applicable. 7 21. On information and belief, the failure of Cross-Defendant HM Tax Services, Cross- 8 Defendant Edmund Ko, Cross-Defendant Fung Ming Ng, Cross-Defendant Jing Hua Gao, and 9 Does 6 through 50 to maintain minutes or adequate records renders the alter ego doctrine 10 applicable. 11 22. On information and belief, the disregard of legal formalities by Cross-Defendant HM Tax 12 Services, Cross-Defendant Edmund Ko, Cross-Defendant Fung Ming Ng, Cross-Defendant Jing 13 Hua Gao, and Does 6 through 50 renders the alter ego doctrine applicable. 14 23. On information and belief, the representations that Cross-Defendant Hua May Tax Services 15 dba Chinese American Associates (“CAA”) are personally liable for Cross-Defendant Hua May 16 Tax Services dba Chinese American Associates’ (“CAA”) debts renders the alter ego doctrine 17 applicable. 18 24. On information and belief, the use of Cross-Defendant HM Tax Services as a mere shell, 19 instrumentality, or conduit for a single venture renders the alter ego doctrine applicable. 20 25. Cross-Complainants do not presently know the true names and capacities of Cross- 21 Defendants sued herein as Does 1 through 100, inclusive. Cross-Complainants will seek leave 22 of court to amend this Complaint to allege Cross-Defendants true names and capacities as soon 23 as Cross-Complainants ascertain them. 24 26. At all relevant times herein, Mrs. Cao could not competently speak or read in the English 25 language. Mrs. Cao’s native language is Chinese. 26 27. GTK & Mrs. Cao negotiated in the Chinese language an agreement with Mr. Tsao, SDB & 27 Mrs. Wang for a lease agreement for the premises located at 3741 Geary Boulevard, San 28 Francisco, California (the “premises”), the purchase of SDB, and the corresponding rights to 4 Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint 1 operate a restaurant on the premises. 2 28. Mr. Tsao uses the structure where the premises are located for permanent residential use. 3 29. At all relevant times herein, SDB & Mrs. Wang acted with malice or the intent to defraud 4 GTK & Mrs. Cao. 5 30. During these negotiations, SDB & Mrs. Wang misrepresented to GTK & Mrs. Cao the 6 monthly rent she was paying under her lease agreement was $6,100, when in fact it was $5,000. 7 31. During these negotiations, Mr. Tsao claimed he did not have a copy of his lease agreement 8 with SDB & Mrs. Wang to show GTK & Mrs. Cao. Mr. Tsao affirmed SDB & Mrs. Wang’s 9 misrepresentation that the monthly rent she was paying under her lease agreement was $6,100, 10 when in fact it was $5,000. 11 32. SDB & Mrs. Wang orally represented to GTK & Mrs. Cao that SDB & Mrs. Wang would 12 reimburse GTK & Mrs. Cao for any repairs that needed to be made to the equipment and fixtures 13 after GTK & Mrs. Cao took possession of the premises. 14 33. At all times relevant herein, CAA and its shareholders were not authorized to practice law 15 in the State of California, nor were they authorized to perform escrow services other than real 16 estate escrows where the licensed realtor represents a party to the transaction. 17 34. In exchange for payment of at least $690 from SDB and at least $2,140 from GTK, CAA and 18 its shareholders prepared a written agreement for the transaction negotiated between Mrs. 19 Wang, Mrs. Cao, and Mr. Tsao. 20 35. On or about June 12, 2017, in the City and County of San Francisco in the State of California, 21 Cross-Complainants and SDB & Mrs. Wang entered into the English-language Business Purchase 22 Agreement, a true copy of which is attached to this Complaint as Exhibit A and is incorporated 23 into this Complaint by reference. 24 36. The Business Purchase Agreement stated that CAA and its shareholders represented neither 25 party. 26 37. At no point did GTK or Mrs. Cao receive a Chinese language translation of any of the terms 27 of the Business Purchase Agreement. 28 38. The Business Purchase Agreement obligated SDB & Mrs. Wang to transfer “[t]he fixtures 5 Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint 1 and equipment now on the premises described in Exhibit 1, which is attached to and made a 2 part of this Agreement” to GTK & Mrs. Cao. 3 39. At all relevant times, there was no attachment labeled Exhibit 1 containing any fixtures or 4 equipment. 5 40. The Business Purchase Agreement obligated SDB & Mrs. Wang to transfer the goodwill and 6 trade name of SDB to GTK & Mrs. Cao. 7 41. The Business Purchase Agreement obligated SDB & Mrs. Wang to transfer a beer and wine 8 license to GTK & Mrs. Cao. 9 42. The Business Purchase Agreement obligated GTK & Mrs. Cao to pay SDB & Mrs. Wang 10 $10,000 as consideration for the fixtures and equipment, $30,000 for the goodwill and trade 11 name, $7,000 for the leasehold, and $3,000 for the beer & wine license. 12 43. The Business Purchase Agreement obligated GTK & Mrs. Cao to make these payments 13 totaling $50,000 to Chinese American Associates as the escrow service. 14 44. The Business Purchase Agreement incorporated escrow instructions prepared by Chinese 15 American Associates. 16 45. No escrow instructions were attached to the Business Purchase Agreement, produced upon 17 execution of the agreement, or otherwise provided to the parties. 18 46. As a condition of taking possession of the premises pursuant to the Commercial Lease 19 Agreement, Mr. Tsao, SDB, and Mrs. Wang required GTK & Mrs. Cao to make payments of at 20 least $60,001.88 as key money for the leasehold. 21 47. GTK & Mrs. Cao tendered a check for $50,000 made on their behalf to SDB & Mrs. Wang, 22 as a condition to initiating her lease agreement with Mr. Tsao. 23 48. SDB & Mrs. Wang initially accepted the check, then rejected the check shortly thereafter 24 and demanded $50,000 in cash, citing taxation as a reason for the rejection. 25 49. GTK & Mrs. Cao tendered cash payments totaling $50,000 to SDB & Mrs. Wang, as a 26 condition to initiating their lease agreement with Mr. Tsao. 27 50. Mr. Tsao, SDB, and Mrs. Wang required GTK & Mrs. Cao to make an additional payment of 28 $6,640.94 to Mr. Tsao as a condition of initiating their lease agreement with Mr. Tsao. 6 Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint 1 51. Mr. Tsao, SDB, and Mrs. Wang required GTK & Mrs. Cao to make an additional payment of 2 $3,360.94 to the City and County of San Francisco for a debt obligation as a condition of 3 initiating their lease agreement with Mr. Tsao. 4 52. Mr. Tsao, SDB, and Mrs. Wang required GTK & Mrs. Cao to make an additional payment of 5 $50,000, in escrow by Chinese American Associates. 6 53. GTK & Mrs. Cao made the additional payment of $50,000 to Chinese American Associates 7 in escrow. 8 54. SDB & Mrs. Wang dissolved SDB on June 22, 2018. 9 55. SDB & Mrs. Wang subsequently made an audio recording of herself admitting that she had 10 fraudulently misrepresented the amount of rent she was paying at that time to GTK & Mrs. Cao, 11 demonstrating concern that Mrs. Cao had eventually found out the truth. 12 56. When confronted about the deception, Mr. Tsao claimed that SDB & Mrs. Wang had been 13 paying an additional $1,100 in cash each month, and invited GTK & Mrs. Cao to do the same. 14 57. At no point did SDB or Mrs. Wang transfer the goodwill or trade name of SDB to GTK or 15 Mrs. Cao. 16 58. SDB & Mrs. Wang subsequently brought suit against GTK & Mrs. Cao for breach of contract 17 in the above-captioned matter for the additional $50,000 held by the illegal escrow. 18 59. In the preliminary Chinese language negotiations between GTK & Mrs. Cao with Mr. Tsao, 19 Mr. Tsao represented to Mrs. Cao that she would not have to pay for any utilities or taxes in 20 addition to the rent. 21 60. Mr. Tsao then produced an English-language Commercial Lease Agreement, a true copy of 22 which is attached to this Complaint as Exhibit B. The Commercial Lease Agreement contained 23 an ambiguous, boilerplate clause stating that “property operating expenses” would be shared 24 proportionately. Mr. Tsao left the blank space for affirming and specifying the term empty. 25 61. At Mr. Tsao’s direction, GTK executed the Commercial Lease Agreement. 26 62. As a condition of initiating its tenancy, Mr. Tsao required GTK to make a key money 27 payment of at least $6,640.94. 28 63. GTK satisfied Mr. Tsao’s demand for the key money payment. 7 Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint 1 64. At no point did GTK or Mrs. Cao receive a Chinese language translation of any of the terms 2 of the Commercial Lease Agreement. 3 65. In his Chinese language communications with Mrs. Cao from the inception of her tenancy, 4 Mr. Tsao initially did not indicate that GTK had an obligation to pay “property operating 5 expenses.” 6 66. After causing GTK to rely upon an understanding that she had no obligation to pay “property 7 operating expenses,” Mr. Tsao demanded several months’ worth of “property operating 8 expenses” at once, citing the ambiguous English-language lease provision. 9 67. Throughout the course of GTK’s tenancy, Mr. Tsao entered its rented premises without 10 notice, made persistent threatening communications to GTK, and interfered with its quiet 11 enjoyment. 12 68. GTK made timely payments of rent to Mr. Tsao each month. 13 69. On February 25, 2019, Mr. Tsao filed an unlawful detainer lawsuit against GTK alleging 14 nonpayment of rent. 15 70. In Mr. Tsao’s verified complaint, he states under the penalty of perjury that the total monthly 16 rent owed by GTK is $6,500. That verified statement is unqualified. He also alleges that GTK 17 owes $5,141.50 in rent for the period of June 10, 2018 through December 10, 2018. No factual 18 or legal basis is stated for this allegation in Mr. Tsao’s verified unlawful detainer complaint or 19 its attachments. He seems to have hand-circled the “property operating expenses” clause in the 20 attached lease agreement which he never completed where provided or explained to GTK & 21 Mrs. Cao. 22 71. The fourth paragraph of the Commercial Lease Agreement defines rent as all monetary 23 obligations in that agreement. 24 72. Mr. Tsao required GTK & Mrs. Cao to make payments in addition to rent and place their 25 names in his utility bills to incur those costs. 26 73. At arbitrary times Mr. Tsao has demanded payment for insurance from GTK & Mrs. Cao, 27 but never demonstrated what obligation GTK & Mrs. Cao owed him to contribute to Mr. Tsao’s 28 purported insurance policies. Fearing eviction and the limitation of their English-language 8 Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint 1 capability to enforce their rights, GTK & Mrs. Cao have made such payments in the past despite 2 having no obligation to do so. 3 74. Mr. Tsao is and was an insured of GTK & Mrs. Cao’s insurance policy covering the premises. 4 First Cause of Action Breach of Contract 5 as to Cross-Defendants SDB Inc., Shubo Wang, David Tsao, and Does 1-5 6 75. GTK & Mrs. Cao incorporate by reference Paragraphs 1 through 74 of this Complaint. 7 76. GTK & Mrs. Cao negotiated the terms of the Business Purchase Agreement with SDB & Mrs. 8 Wang in the Chinese language. 9 77. SDB & Mrs. Wang had GTK & Mrs. Cao execute the English-language Business Purchase 10 Agreement. GTK & Mrs. Cao never received a Chinese translation of the terms of the Business 11 Purchase Agreement as required by California Civil Code section 1632. 12 78. Section 1632 requires that “[a]ny person engaged in a trade or business who negotiates 13 primarily in Spanish, Chinese, Tagalog, Vietnamese, or Korean, orally, or in writing” to provide 14 the other party to an agreement, including a lease, with “a translation of the contract or 15 agreement in the language in which the contract or agreement was negotiated.” 16 79. SDB & Mrs. Wang waived their right to require GTK & Mrs. Cao authorize the illegal escrow 17 service to release funds when SDB & Mrs. Wang refused tender of the $50,000 check. 18 80. SDB & Mrs. Wang accepted full satisfaction of payment when they accepted $50,000 in cash 19 from GTK & Mrs. Cao. 20 81. SDB & Mrs. Wang wrongfully required GTK & Mrs. Cao to make additional payment of 21 $50,000 to the illegal escrow service. 22 82. SDB & Mrs. Wang failed to transfer the fixtures and equipment to GTK & Mrs. Cao as 23 required by the Business Purchase Agreement or reimburse GTK & Mrs. Cao for repairs as had 24 been agreed orally. 25 83. SDB & Mrs. Wang failed to transfer the goodwill and trade name of SDB to GTK & Mrs. Cao 26 as required by the Business Purchase Agreement. 27 84. GTK & Mrs. Cao did not obtain a satisfactory new lease for the premises from Mr. Tsao as 28 required by the Business Purchase Agreement. 9 Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint 1 85. The breach of contract by SDB & Mrs. Wang was a substantial factor in causing harm to 2 GTK & Mrs. Cao. 3 86. GTK & Mrs. Cao negotiated the terms of the Business Purchase Agreement with Mr. Tsao in 4 the Chinese language. 5 87. Mr. Tsao had GTK & Mrs. Cao execute the English-language Commercial Lease Agreement. 6 GTK & Mrs. Cao never received a Chinese translation of the terms of the Commercial Lease 7 Agreement as required by California Civil Code section 1632. 8 88. The fourth paragraph of the Commercial Lease Agreement defines rent as all monetary 9 obligations in that agreement. 10 89. In Mr. Tsao’s verified unlawful detainer complaint, he stated under the penalty of perjury 11 that the total monthly rent owed by GTK is $6,500, and did not expressly identify on the face 12 of the complaint any other obligations owed by GTK. 13 90. Mr. Tsao was not entitled to require GTK & Mrs. Cao to make additional payments and place 14 his utility bills in their names to cause them to incur debts arising from his residential utility 15 usage upstairs. 16 91. Mr. Tsao was not entitled to require GTK & Mrs. Cao to make arbitrary and capricious 17 payments for items including but not limited to insurance policies that have never been 18 identified, especially where Mr. Tsao is an insured of GTK & Mrs. Cao’s insurance policy. 19 92. The breach of contract by Mr. Tsao was a substantial factor in causing harm to GTK & Mrs. 20 Cao. 21 Second Cause of Action California Civil Code section 1950.8 22 as to Cross-Defendants SDB Inc., Shubo Wang, David Tsao, and Does 1-5 23 93. GTK & Mrs. Cao incorporate by reference Paragraphs 1 through 92 of this Complaint. 24 94. California Civil Code section 1950.8 prohibits any person from requiring, demanding, or 25 causing to make payable any payment of money, including, but not limited to, “key money,” 26 however denominated, as a condition of initiating, continuing, or renewing a lease or rental 27 agreement, unless the amount of payment is stated in the written lease or rental agreement. 28 95. Any person who requires, demands, or causes to make payable any payment in violation of 10 Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint 1 subdivision (a), shall be subject to civil penalty of three times the amount of actual damages 2 proximately suffered by the person seeking to obtain the lease or rental of real property, and 3 the person so damaged shall be entitled to an award of costs, including reasonable attorney’s 4 fees, reasonable incurred in connection with obtaining the civil penalty. 5 96. As a condition of taking possession of the premises pursuant to the Commercial Lease 6 Agreement, Mr. Tsao, SDB, and Mrs. Wang required GTK & Mrs. Cao to make payments of at 7 least $60,001.88 as key money for the leasehold. 8 97. Mr. Tsao, SDB, and Mrs. Wang violated section 1950.8. 9 98. GTK & Mrs. Cao are entitled to a civil penalty of at least $180,005.40, or a greater sum 10 according to proof, and attorney fees, from Mr. Tsao, SDB, and Mrs. Wang. 11 Third Cause of Action Fraud and Deceit 12 as to All Cross-Defendants 13 99. GTK & Mrs. Cao incorporate by reference Paragraphs 1 through 98 of this Complaint. 14 100. Mr. Tsao, SDB, Mrs. Wang, CAA, CAA’s shareholders, and Does 6-50 falsely represented to 15 GTK & Mrs. Cao that SDB & Mrs. Wang were paying $6,100 in rent for the premises when they 16 were actually paying $5,000 in rent. 17 101. Mr. Tsao, SDB, Mrs. Wang, CAA, CAA’s shareholders, and Does 6-50 knew that the 18 representation was false when they made it, or made the representation recklessly and without 19 regard for its truth. 20 102. Mr. Tsao, SDB, Mrs. Wang, CAA, CAA’s shareholders, and Does 6-50 intended that GTK & 21 Mrs. Cao rely on the representation. 22 103. GTK & Mrs. Cao reasonably relied on the representation by Mr. Tsao, SDB, Mrs. Wang, 23 CAA, CAA’s shareholders, and Does 6-50. 24 104. The reliance by GTK & Mrs. Cao on the representation by Mr. Tsao, SDB, Mrs. Wang, CAA, 25 CAA’s shareholders, and Does 6-50 were substantial factors in causing the harm to GTK & Mrs. 26 Cao. 27 105. Mr. Tsao falsely represented to GTK & Mrs. Cao the amounts due under the Commercial 28 Lease Agreement, and whether the Commercial Lease Agreement required Mrs. Cao to incur 11 Defendants/Cross-Complainants General Tso Kitchen, Inc. and Li Cao Second Amended Cross-Complaint 1 Mr. Tsao’s separate utility bills and insurance obligations in addition to her own. 2 106. Mr. Tsao knew his representations were false when he made them, or