Preview
1 Collin J. Vierra (State Bar No. 322720)
EIMER STAHL LLP
2
99 S. Almaden Blvd., Ste. 600
3 San Jose, CA 95113-1605
Telephone: (408) 889-1668
4 Email: cvierra@eimerstahl.com
5 Attorney for Plaintiffs
6
7 SUPERIOR COURT OF THE STATE OF CALIFORNIA
8 COUNTY OF SAN MATEO
9
Robert Arntsen; Mary Lee; Arntsen Family Case No. 22-CIV-01148
10
Partnership, LP; and Brian Christopher Dunn
11 Custodianship; Dept. 21
12 Plaintiffs, Hon. Robert D. Foiles
v.
13
14 David M. Bragg; Silicon Valley Real Ventures DECLARATION OF ROBERT
LLC; SVRV 385 Moore, LLC; SVRV 387 ARNTSEN
15 Moore, LLC; Gregory J. Davis; Kevin Wolfe;
Jason Justesen; Paramont Woodside, LLC;
16 and Paramont Capital, LLC;
17 Defendants.
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DECLARATION OF ROBERT ARNTSEN
1 I, Robert Arntsen, attest as follows:
2 1. I am over the age of 18, of sound mind, and otherwise competent to make this
3 Declaration. I am 73 years old.
4 2. Dave Bragg (“Dave”) 1 first approached me about investing in his new company,
5 Silicon Valley Real Ventures, LLC (“SVRV”) in 2014. In 2015, when I was 65 years old, I agreed
6 to invest $152,500 in SVRV for a 50% preferred return. A true and correct copy of the contract
7 memorializing that investment and the authorization for the transfer are attached as Exhibit A.
8 Dave told me that my investment was being used for one of SVRV’s projects, called the SVRV
9 Land project, and that I would recoup my investment and 50% preferred return when the SVRV
10 Land project sold.
11 3. In late 2017, Dave approached me about investing in a new project, called the
12 Moore Road Project. He asked if my family members would also be willing to invest. He said he
13 needed about $750,000 from me and my family and asked for my family’s email addresses.
14 Although the SVRV Land project had not closed yet, Dave assured me this was getting close and
15 that my investment in the SVRV Land project had been highly profitable. Specifically, he told me
16 that my return from the SVRV Land project would be over $200,000, and that this would be rolled
17 over into the Moore Road Project when it became liquid.
18 4. In December 2017, Dave told me and my sister, Martha, that he needed $150,000
19 right away to make a deposit for the Moore Road Project. This deposit was apparently to purchase
20 an option to buy the Moore Road properties later in 2018. Our family partnership, the Arntsen
21 Family Partnership, LP, which Martha manages, contributed this $150,000 on December 19, 2017.
22 5. In February 2018, Martha and I met with Dave to discuss the terms of the rest of
23 my family’s investment in the Moore Road Project. Dave presented us with printed copies of
24 operating agreements and an investment-subscription agreement for our investment. He said the
25 agreements would need to be updated with the exact amounts we invested and the final names of
26 the LLCs once they were registered with the California Secretary of State, but represented that
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Hereinafter, “Dave” refers collectively to Dave and SVRV.
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DECLARATION OF ROBERT ARNTSEN
1 these agreements would govern our investments. These operating agreements provided, among
2 other things, that if additional members were to be admitted, they would participate in profits,
3 losses, and distributions “on such terms as are determined by the Members,” and further that “[a]ll
4 amendments to th[ese] Agreement[s] will be in writing and signed by all of the Members.” Dave’s
5 co-director of SVRV, Kurtis Kludt, emailed me digital copies of these agreements on February 27,
6 2018. In his email, he confirmed: “You and Martha are the majority owners with SVRV.” A true
7 and correct copy of the February 27, 2018 email from Kurtis is attached as Exhibit B. True and
8 correct copies of the operating agreements and investment-subscription agreement linked in
9 Kurtis’s email are attached as Exhibits C, D, and E, respectively.
10 6. In June 2018, my family and I made additional investments in the Moore Road
11 Project. On June 25, 2018, I specifically invested $30,000 FBO my daughter, Jennifer Arntsen. A
12 true and correct copy of a check showing that investment is attached as Exhibit F. Dave admitted
13 that $30,000 was invested FBO Jen[nifer] Arntsen in discovery. Vierra Aff. ¶ 8, Ex. Z (Response
14 to SRog 8). Meanwhile, I was waiting for Dave to roll over my return from the SVRV Land project
15 into the Moore Road Project.
16 7. On August 29, 2018, Dave contacted Martha and me, and our other sister, Mary, to
17 say he was ready to “process the investor agreements,” which I understood to mean that the
18 operating agreements and investment-subscription agreement we had agreed to in February 2018
19 would be updated to reflect the exact amounts we had invested, including the amount to be rolled
20 over from my prior investment in the SVRV Land project. To that end, Dave also told me that we
21 “need to meet live soon and finalize the amount to roll [over] from the [SVRV Land] investment.”
22 A true and correct copy of an email thread showing the August 29, 2018 email from Dave is
23 attached as Exhibit G. Dave never sent the updated copies of these agreements as promised.
24 8. I spoke with Dave in October 2018 and told him that my entire proceeds from the
25 SVRV Land project should be rolled over into the Moore Road Project. He told me this amount
26 would be $205,000. However, he said he could not do the rollover immediately because now my
27 capital was tied up in another SVRV project, called the SVRV 631 Beach project. I never
28 authorized my money to be used for this purpose, but Dave assured me that I would still receive
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DECLARATION OF ROBERT ARNTSEN
1 my $205,000 return. Dave gave me a cap table for the Moore Road Project showing my $205,000
2 rollover with an anticipated date of January 1, 2019. A true and correct copy of that cap table is
3 attached as Exhibit H.
4 9. During discovery, contrary to every representation Dave made to me during the
5 pendency of the Moore Road Project, Dave stated that “[t]here were no proceeds from the SVRV
6 Land project to roll over into the Moore Road Project.” Vierra Aff. ¶ 8, Ex. D (Response to RFA
7 16). Had Dave told me the truth about the state of the SVRV Land project, I never would have
8 introduced him to my sisters or invested any more money with him or his businesses, including
9 the Moore Road Project.
10 10. As noted above, the two operating agreements for the Moore Road LLCs provided
11 that no amendments could be made without the express written consent of all members, and Dave
12 never sought my consent for any amendments to the operating agreements.
13 11. In March 2019, Dave asked Martha and me to meet with him to discuss urgent
14 funding needs for the Moore Road Project. He said the Moore Road Project needed $200,000
15 immediately to secure an investment from a third party (an entity called Paramont Woodside, LLC)
16 that wanted to see that enough capital was available to complete the project. Dave told Martha and
17 me that if we made short-term loans to the Moore Road Project for a total of $200,000, the loans
18 would be returned promptly with 12% interest. Dave said my rollover investment could not be
19 used to secure the new funding because that capital was still tied up in the SVRV 631 Beach
20 project.
21 12. Believing it was necessary to preserve the Moore Road Project, I extended a
22 $100,000 short-term loan to the Moore Road Project on March 19, 2019. A true and correct copy
23 of a check showing that loan is attached as Exhibit I. As I found out later through discovery,
24 Paramont had invested in the Moore Road LLCs back in November 2018 and thus did not need to
25 “see” any additional capital to invest. Dave apparently used the money for the SVRV 631 Beach
26 project, which I had not invested in. Had Dave told me the truth about why he needed the money,
27 I never would have extended the short-term loan.
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DECLARATION OF ROBERT ARNTSEN
1 13. Dave refused to follow up with me about my loan for over a month. On April 26,
2 2019, I wrote to Dave, “Now that Beach has closed are you going to be rolling my funds over to
3 the Moore Road projects and returning both my extra and the Arntsen Partnership extra money
4 back to us?” Referring to the operating agreements and investment-subscription agreement we had
5 agreed to in February 2018 that were supposed to be updated with the final amounts we had
6 invested, I also wrote, “We are still waiting for the paperwork for the Moore Road investment so
7 that all of the family investors know what is happening. This is something that needs to be taken
8 care of right away.” Dave responded to me that the SVRV 631 Beach project had “hit a snag” but
9 that it would close soon. He ignored my other questions. A true and correct copy of this email
10 exchange is attached as Exhibit J. I did not learn until this litigation that the SVRV 631 Beach
11 project was also a dismal failure. In fact, I knew nothing about the SVRV 631 Beach project when
12 it was going on, and I never would have loaned Dave $100,000 had I known it was going to be
13 used for the SVRV 631 Beach project.
14 14. After the SVRV 631 Beach project closed, Dave still refused to follow up with me
15 until after Martha contacted him in May 2019. After that, on May 10, 2019, Dave returned to me
16 only $3,641 of my $100,000 short-term loan. In SVRV’s books, SVRV recorded this as a “partial
17 return of short term loan.” A true and correct copy of that SVRV record obtained in this action is
18 attached as Exhibit K. Dave never repaid the outstanding $96,359 on my loan or the promised 12%
19 interest.
20 15. In June 2019, Dave sent me new operating agreements and investment-subscription
21 agreements, which were completely different from the ones that I had agreed to in February
22 2018. Most significantly, these agreements, which Dave had apparently signed with Paramont
23 seven months earlier, purported to grant me no membership interest in the Moore Road LLCs.
24 Instead, under these agreements, only Paramont and SVRV were members in the Moore Road
25 LLCs. And to the extent that SVRV’s investment somehow reflected my interest in the property
26 (even though apart from my 2015 investment, I had not invested in SVRV and had never been
27 given an associated ownership interest in that company) my interest was given a subordinate equity
28 position to that of Paramont. I never consented to any amendment to the original operating
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DECLARATION OF ROBERT ARNTSEN
1 agreements that I had agreed to back in February 2018. And I never would have invested in the
2 Moore Road Project on the terms provided in the new operating agreements Dave signed with
3 Paramont. Accordingly, I refused to sign these new, unauthorized agreements. The agreements
4 also purported to show that I only had $200,000 total invested in the Moore Road Project ($100,000
5 in each LLC)—not the $205,000 that Dave had previously said would be rolled over from my prior
6 investment. True and correct copies of these unauthorized operating and investment-subscription
7 agreements, showing that I did not sign them, are attached as Exhibits L, M, N, and O, respectively.
8 Dave also admitted in discovery that I never signed these agreements. Vierra Aff. ¶ 7, Ex. B
9 (Response to RFAs 9, 11). Dave also admitted in discovery that he did not share these operating
10 agreements with me until June 2019. Vierra Aff. ¶ 8, Ex. B (Response to RFA 14). Dave apparently
11 hid their existence from me because he knew they were contrary to the agreement we had reached
12 in February 2018. I also did not know until this litigation that Dave later signed different
13 investment-subscription agreements with Jacky Huang.
14 16. Dave stated in discovery that I invested $200,000 in the Moore Road Project on
15 January 15, 2019. Vierra Aff. ¶ 8, Ex. Z (Response to SRog 8).
16 17. On March 23, 2020, Dave emailed me to say that he needed more money for the
17 Moore Road Project. He said that without fulfilling these “immediate capital needs for March
18 2020,” “the properties will/could go into default,” putting all of our financial contributions at risk.
19 A true and correct copy of the March 23, 2020 email from Dave is attached as Exhibit P. Dave
20 then arranged a call, which included Kurtis, to discuss this in further detail. On that call, Dave and
21 Kurtis told us that they needed a total of $19,500 immediately, most of which was to come from
22 me and my family. Dave and Kurtis told us that this money would be treated as a loan at 12%
23 interest with prioritized repayment upon sale of the Moore Road properties. The only entity that
24 would be paid before us was the senior lender, Genesis. He assured us this loan would be repaid
25 before any equity.
26 18. On April 1, 2020, believing the money was needed to preserve the Moore Road
27 Project, I loaned another $4,524 to the Moore Road Project. A true and correct copy of a bank
28 record evidencing this transfer obtained from First Republic Bank in discovery is attached as
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DECLARATION OF ROBERT ARNTSEN
1 Exhibit Q. I did not learn until this litigation that Dave actually used this money to pay his business
2 partner, Kurtis. Vierra Aff. ¶ 10, Ex. F.
3 19. When the Moore Road properties sold in September and October 2020, Dave
4 refused to return any money to me. Dave refused to return any money to me even though Paramont
5 received its capital back and received a significant profit. Dave admitted this in discovery. Vierra
6 Aff. ¶ 6, Ex. B (Response to RFA 12). I did not learn until this litigation that Dave signed an
7 explicit agreement with Paramont purporting to prevent me from receiving any funds from the
8 Moore Road LLCs after the properties sold. Through 2020 and 2021, I tried to obtain information
9 about the Moore Road Project from Dave for myself, the Partnership, the Custodianship, and Mary,
10 but Dave largely refused to provide me with any information. Among other things, he refused to
11 provide me with an accounting for the Moore Road Project, which made me suspicious that funds
12 had been misappropriated. Despite not returning any money to me, Dave also failed to close the
13 account from which I made my initial investment in SVRV, which has caused me to incur penalties
14 even to this day, and despite repeated outreach to Dave. As for my $100,000 short-term loan, when
15 I inquired about this again in May 2021, Dave told the egregious lie that, “From memory you and
16 your family provided an additional $200,000, $100,000 was from your family trust and was a
17 placeholder while we raised additional funds. The other $100,000 was money that you put up while
18 you waited for other investments in SVRV became liquid. We were able to raise the capital for
19 your family trust and returned the $100,000. Unfortunately, your other investments with SVRV
20 did not yield what was expected, and we returned the only funds that we had and from memory, it
21 was only around $3500.” A true and correct copy of that email thread is attached as Exhibit R.
22 Until that time, Dave had also never claimed that my “other investments with SVRV did not yield
23 what was expected.” To the contrary, he told me they had been highly successful, and that my
24 proceeds had been rolled over into the Moore Road Project.
25 20. Dave told me that all of my investments and loans would be used exclusively for
26 the Moore Road Project. I relied on this when making my investments and loans, and I never would
27 have authorized my money to be used for any other purpose. In summary, Dave defrauded me of:
28 a. $205,000 from my rollover investment in the Moore Road Project;
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DECLARATION OF ROBERT ARNTSEN
1 b. $98,068.59 in remaining principal on my March 19, 2019 short-term loan plus
2 12% interest on that remaining principal running from May 10, 2019 to the
3 present;
4 c. $4,524 in principal on my April 1, 2020 loan and 12% interest on that loan
5 running from April 1, 2020 to the present;
6 d. $30,000 from my June 25, 2018 investment in the Moore Road Project on behalf
7 of my daughter, Jennifer Arntsen;
8 e. $23,750 in the form of my promised 50% preferred return on my initial
9 investment of $152,500 in SVRV less the amount rolled over into the Moore
10 Road Project.
11 21. Dave’s fraud has also caused me to forego years of interest and to incur significant
12 attorneys’ fees in the form of a 33% contingency on my recover(ies).
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14 I declare under penalty of perjury, under the laws of the State of California, that the
15 foregoing is true and correct to the best of my knowledge.
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18 Dated: March 21, 2023
Robert Arntsen
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DECLARATION OF ROBERT ARNTSEN
Preview
1 Collin J. Vierra (State Bar No. 322720) EIMER STAHL LLP 2 99 S. Almaden Blvd., Ste. 600 3 San Jose, CA 95113-1605 Telephone: (408) 889-1668 4 Email: cvierra@eimerstahl.com 5 Attorney for Plaintiffs 6 7 SUPERIOR COURT OF THE STATE OF CALIFORNIA 8 COUNTY OF SAN MATEO 9 Robert Arntsen; Mary Lee; Arntsen Family Case No. 22-CIV-01148 10 Partnership, LP; and Brian Christopher Dunn 11 Custodianship; Dept. 21 12 Plaintiffs, Hon. Robert D. Foiles v. 13 14 David M. Bragg; Silicon Valley Real Ventures DECLARATION OF ROBERT LLC; SVRV 385 Moore, LLC; SVRV 387 ARNTSEN 15 Moore, LLC; Gregory J. Davis; Kevin Wolfe; Jason Justesen; Paramont Woodside, LLC; 16 and Paramont Capital, LLC; 17 Defendants. 18 19 20 21 22 23 24 25 26 27 28 1 DECLARATION OF ROBERT ARNTSEN 1 I, Robert Arntsen, attest as follows: 2 1. I am over the age of 18, of sound mind, and otherwise competent to make this 3 Declaration. I am 73 years old. 4 2. Dave Bragg (“Dave”) 1 first approached me about investing in his new company, 5 Silicon Valley Real Ventures, LLC (“SVRV”) in 2014. In 2015, when I was 65 years old, I agreed 6 to invest $152,500 in SVRV for a 50% preferred return. A true and correct copy of the contract 7 memorializing that investment and the authorization for the transfer are attached as Exhibit A. 8 Dave told me that my investment was being used for one of SVRV’s projects, called the SVRV 9 Land project, and that I would recoup my investment and 50% preferred return when the SVRV 10 Land project sold. 11 3. In late 2017, Dave approached me about investing in a new project, called the 12 Moore Road Project. He asked if my family members would also be willing to invest. He said he 13 needed about $750,000 from me and my family and asked for my family’s email addresses. 14 Although the SVRV Land project had not closed yet, Dave assured me this was getting close and 15 that my investment in the SVRV Land project had been highly profitable. Specifically, he told me 16 that my return from the SVRV Land project would be over $200,000, and that this would be rolled 17 over into the Moore Road Project when it became liquid. 18 4. In December 2017, Dave told me and my sister, Martha, that he needed $150,000 19 right away to make a deposit for the Moore Road Project. This deposit was apparently to purchase 20 an option to buy the Moore Road properties later in 2018. Our family partnership, the Arntsen 21 Family Partnership, LP, which Martha manages, contributed this $150,000 on December 19, 2017. 22 5. In February 2018, Martha and I met with Dave to discuss the terms of the rest of 23 my family’s investment in the Moore Road Project. Dave presented us with printed copies of 24 operating agreements and an investment-subscription agreement for our investment. He said the 25 agreements would need to be updated with the exact amounts we invested and the final names of 26 the LLCs once they were registered with the California Secretary of State, but represented that 27 28 1 Hereinafter, “Dave” refers collectively to Dave and SVRV. 2 DECLARATION OF ROBERT ARNTSEN 1 these agreements would govern our investments. These operating agreements provided, among 2 other things, that if additional members were to be admitted, they would participate in profits, 3 losses, and distributions “on such terms as are determined by the Members,” and further that “[a]ll 4 amendments to th[ese] Agreement[s] will be in writing and signed by all of the Members.” Dave’s 5 co-director of SVRV, Kurtis Kludt, emailed me digital copies of these agreements on February 27, 6 2018. In his email, he confirmed: “You and Martha are the majority owners with SVRV.” A true 7 and correct copy of the February 27, 2018 email from Kurtis is attached as Exhibit B. True and 8 correct copies of the operating agreements and investment-subscription agreement linked in 9 Kurtis’s email are attached as Exhibits C, D, and E, respectively. 10 6. In June 2018, my family and I made additional investments in the Moore Road 11 Project. On June 25, 2018, I specifically invested $30,000 FBO my daughter, Jennifer Arntsen. A 12 true and correct copy of a check showing that investment is attached as Exhibit F. Dave admitted 13 that $30,000 was invested FBO Jen[nifer] Arntsen in discovery. Vierra Aff. ¶ 8, Ex. Z (Response 14 to SRog 8). Meanwhile, I was waiting for Dave to roll over my return from the SVRV Land project 15 into the Moore Road Project. 16 7. On August 29, 2018, Dave contacted Martha and me, and our other sister, Mary, to 17 say he was ready to “process the investor agreements,” which I understood to mean that the 18 operating agreements and investment-subscription agreement we had agreed to in February 2018 19 would be updated to reflect the exact amounts we had invested, including the amount to be rolled 20 over from my prior investment in the SVRV Land project. To that end, Dave also told me that we 21 “need to meet live soon and finalize the amount to roll [over] from the [SVRV Land] investment.” 22 A true and correct copy of an email thread showing the August 29, 2018 email from Dave is 23 attached as Exhibit G. Dave never sent the updated copies of these agreements as promised. 24 8. I spoke with Dave in October 2018 and told him that my entire proceeds from the 25 SVRV Land project should be rolled over into the Moore Road Project. He told me this amount 26 would be $205,000. However, he said he could not do the rollover immediately because now my 27 capital was tied up in another SVRV project, called the SVRV 631 Beach project. I never 28 authorized my money to be used for this purpose, but Dave assured me that I would still receive 3 DECLARATION OF ROBERT ARNTSEN 1 my $205,000 return. Dave gave me a cap table for the Moore Road Project showing my $205,000 2 rollover with an anticipated date of January 1, 2019. A true and correct copy of that cap table is 3 attached as Exhibit H. 4 9. During discovery, contrary to every representation Dave made to me during the 5 pendency of the Moore Road Project, Dave stated that “[t]here were no proceeds from the SVRV 6 Land project to roll over into the Moore Road Project.” Vierra Aff. ¶ 8, Ex. D (Response to RFA 7 16). Had Dave told me the truth about the state of the SVRV Land project, I never would have 8 introduced him to my sisters or invested any more money with him or his businesses, including 9 the Moore Road Project. 10 10. As noted above, the two operating agreements for the Moore Road LLCs provided 11 that no amendments could be made without the express written consent of all members, and Dave 12 never sought my consent for any amendments to the operating agreements. 13 11. In March 2019, Dave asked Martha and me to meet with him to discuss urgent 14 funding needs for the Moore Road Project. He said the Moore Road Project needed $200,000 15 immediately to secure an investment from a third party (an entity called Paramont Woodside, LLC) 16 that wanted to see that enough capital was available to complete the project. Dave told Martha and 17 me that if we made short-term loans to the Moore Road Project for a total of $200,000, the loans 18 would be returned promptly with 12% interest. Dave said my rollover investment could not be 19 used to secure the new funding because that capital was still tied up in the SVRV 631 Beach 20 project. 21 12. Believing it was necessary to preserve the Moore Road Project, I extended a 22 $100,000 short-term loan to the Moore Road Project on March 19, 2019. A true and correct copy 23 of a check showing that loan is attached as Exhibit I. As I found out later through discovery, 24 Paramont had invested in the Moore Road LLCs back in November 2018 and thus did not need to 25 “see” any additional capital to invest. Dave apparently used the money for the SVRV 631 Beach 26 project, which I had not invested in. Had Dave told me the truth about why he needed the money, 27 I never would have extended the short-term loan. 28 4 DECLARATION OF ROBERT ARNTSEN 1 13. Dave refused to follow up with me about my loan for over a month. On April 26, 2 2019, I wrote to Dave, “Now that Beach has closed are you going to be rolling my funds over to 3 the Moore Road projects and returning both my extra and the Arntsen Partnership extra money 4 back to us?” Referring to the operating agreements and investment-subscription agreement we had 5 agreed to in February 2018 that were supposed to be updated with the final amounts we had 6 invested, I also wrote, “We are still waiting for the paperwork for the Moore Road investment so 7 that all of the family investors know what is happening. This is something that needs to be taken 8 care of right away.” Dave responded to me that the SVRV 631 Beach project had “hit a snag” but 9 that it would close soon. He ignored my other questions. A true and correct copy of this email 10 exchange is attached as Exhibit J. I did not learn until this litigation that the SVRV 631 Beach 11 project was also a dismal failure. In fact, I knew nothing about the SVRV 631 Beach project when 12 it was going on, and I never would have loaned Dave $100,000 had I known it was going to be 13 used for the SVRV 631 Beach project. 14 14. After the SVRV 631 Beach project closed, Dave still refused to follow up with me 15 until after Martha contacted him in May 2019. After that, on May 10, 2019, Dave returned to me 16 only $3,641 of my $100,000 short-term loan. In SVRV’s books, SVRV recorded this as a “partial 17 return of short term loan.” A true and correct copy of that SVRV record obtained in this action is 18 attached as Exhibit K. Dave never repaid the outstanding $96,359 on my loan or the promised 12% 19 interest. 20 15. In June 2019, Dave sent me new operating agreements and investment-subscription 21 agreements, which were completely different from the ones that I had agreed to in February 22 2018. Most significantly, these agreements, which Dave had apparently signed with Paramont 23 seven months earlier, purported to grant me no membership interest in the Moore Road LLCs. 24 Instead, under these agreements, only Paramont and SVRV were members in the Moore Road 25 LLCs. And to the extent that SVRV’s investment somehow reflected my interest in the property 26 (even though apart from my 2015 investment, I had not invested in SVRV and had never been 27 given an associated ownership interest in that company) my interest was given a subordinate equity 28 position to that of Paramont. I never consented to any amendment to the original operating 5 DECLARATION OF ROBERT ARNTSEN 1 agreements that I had agreed to back in February 2018. And I never would have invested in the 2 Moore Road Project on the terms provided in the new operating agreements Dave signed with 3 Paramont. Accordingly, I refused to sign these new, unauthorized agreements. The agreements 4 also purported to show that I only had $200,000 total invested in the Moore Road Project ($100,000 5 in each LLC)—not the $205,000 that Dave had previously said would be rolled over from my prior 6 investment. True and correct copies of these unauthorized operating and investment-subscription 7 agreements, showing that I did not sign them, are attached as Exhibits L, M, N, and O, respectively. 8 Dave also admitted in discovery that I never signed these agreements. Vierra Aff. ¶ 7, Ex. B 9 (Response to RFAs 9, 11). Dave also admitted in discovery that he did not share these operating 10 agreements with me until June 2019. Vierra Aff. ¶ 8, Ex. B (Response to RFA 14). Dave apparently 11 hid their existence from me because he knew they were contrary to the agreement we had reached 12 in February 2018. I also did not know until this litigation that Dave later signed different 13 investment-subscription agreements with Jacky Huang. 14 16. Dave stated in discovery that I invested $200,000 in the Moore Road Project on 15 January 15, 2019. Vierra Aff. ¶ 8, Ex. Z (Response to SRog 8). 16 17. On March 23, 2020, Dave emailed me to say that he needed more money for the 17 Moore Road Project. He said that without fulfilling these “immediate capital needs for March 18 2020,” “the properties will/could go into default,” putting all of our financial contributions at risk. 19 A true and correct copy of the March 23, 2020 email from Dave is attached as Exhibit P. Dave 20 then arranged a call, which included Kurtis, to discuss this in further detail. On that call, Dave and 21 Kurtis told us that they needed a total of $19,500 immediately, most of which was to come from 22 me and my family. Dave and Kurtis told us that this money would be treated as a loan at 12% 23 interest with prioritized repayment upon sale of the Moore Road properties. The only entity that 24 would be paid before us was the senior lender, Genesis. He assured us this loan would be repaid 25 before any equity. 26 18. On April 1, 2020, believing the money was needed to preserve the Moore Road 27 Project, I loaned another $4,524 to the Moore Road Project. A true and correct copy of a bank 28 record evidencing this transfer obtained from First Republic Bank in discovery is attached as 6 DECLARATION OF ROBERT ARNTSEN 1 Exhibit Q. I did not learn until this litigation that Dave actually used this money to pay his business 2 partner, Kurtis. Vierra Aff. ¶ 10, Ex. F. 3 19. When the Moore Road properties sold in September and October 2020, Dave 4 refused to return any money to me. Dave refused to return any money to me even though Paramont 5 received its capital back and received a significant profit. Dave admitted this in discovery. Vierra 6 Aff. ¶ 6, Ex. B (Response to RFA 12). I did not learn until this litigation that Dave signed an 7 explicit agreement with Paramont purporting to prevent me from receiving any funds from the 8 Moore Road LLCs after the properties sold. Through 2020 and 2021, I tried to obtain information 9 about the Moore Road Project from Dave for myself, the Partnership, the Custodianship, and Mary, 10 but Dave largely refused to provide me with any information. Among other things, he refused to 11 provide me with an accounting for the Moore Road Project, which made me suspicious that funds 12 had been misappropriated. Despite not returning any money to me, Dave also failed to close the 13 account from which I made my initial investment in SVRV, which has caused me to incur penalties 14 even to this day, and despite repeated outreach to Dave. As for my $100,000 short-term loan, when 15 I inquired about this again in May 2021, Dave told the egregious lie that, “From memory you and 16 your family provided an additional $200,000, $100,000 was from your family trust and was a 17 placeholder while we raised additional funds. The other $100,000 was money that you put up while 18 you waited for other investments in SVRV became liquid. We were able to raise the capital for 19 your family trust and returned the $100,000. Unfortunately, your other investments with SVRV 20 did not yield what was expected, and we returned the only funds that we had and from memory, it 21 was only around $3500.” A true and correct copy of that email thread is attached as Exhibit R. 22 Until that time, Dave had also never claimed that my “other investments with SVRV did not yield 23 what was expected.” To the contrary, he told me they had been highly successful, and that my 24 proceeds had been rolled over into the Moore Road Project. 25 20. Dave told me that all of my investments and loans would be used exclusively for 26 the Moore Road Project. I relied on this when making my investments and loans, and I never would 27 have authorized my money to be used for any other purpose. In summary, Dave defrauded me of: 28 a. $205,000 from my rollover investment in the Moore Road Project; 7 DECLARATION OF ROBERT ARNTSEN 1 b. $98,068.59 in remaining principal on my March 19, 2019 short-term loan plus 2 12% interest on that remaining principal running from May 10, 2019 to the 3 present; 4 c. $4,524 in principal on my April 1, 2020 loan and 12% interest on that loan 5 running from April 1, 2020 to the present; 6 d. $30,000 from my June 25, 2018 investment in the Moore Road Project on behalf 7 of my daughter, Jennifer Arntsen; 8 e. $23,750 in the form of my promised 50% preferred return on my initial 9 investment of $152,500 in SVRV less the amount rolled over into the Moore 10 Road Project. 11 21. Dave’s fraud has also caused me to forego years of interest and to incur significant 12 attorneys’ fees in the form of a 33% contingency on my recover(ies). 13 14 I declare under penalty of perjury, under the laws of the State of California, that the 15 foregoing is true and correct to the best of my knowledge. 16 17 18 Dated: March 21, 2023 Robert Arntsen 19 20 21 22 23 24 25 26 27 28 8 DECLARATION OF ROBERT ARNTSEN