Preview
Electroni
callyFi
led Superi
or Court of CA Countyof Contra Costa 2/23/2024 6:03 PM By:K. Ji
nkerson, Deputy
1 RAINES FELDMAN LITTRELL LLP
Kyra E. Andrassy, SBN 207959
2 Timothy Evanston, SBN 319342
3200 Park Center Drive, Suite 250 Per local Rule, Thi
s case is assi gned to
3 Costa Mesa, CA 92626
Telephone: (310) 440-4100
Judge Treat, Charles S, for all purposes.
4 Facsimile: (949) 247-3998
5 Attorneys for Stephen J. Donell, Receiver
6
7
8 SUPERIOR COURT OF THE STATE OF CALIFORNIA
9 FOR THE COUNTY OF CONTRA COSTA
10
11 STEPHEN J. DONELL, solely in his Case No.: C24-00482
capacity as the Receiver for Zola Hospice,
12 LLC, COMPLAINT:
13 Plaintiff, (1) TO AVOID AND RECOVER
FRAUDULENT TRANSFER
14 v. PURSUANT TO CALIFORNIA CIVIL
CODE § 3439.04(A)(2);
15 MARGARET SINGH, an individual,
(2) TO AVOID AND RECOVER
16 Defendant. FRAUDULENT TRANSFER
PURSUANT TO CALIFORNIA CIVIL
17 CODE § 3439.05; AND
18 (3) TO AVOID AND RECOVER
FRAUDULENT TRANSFER
19 PURSUANT TO CALIFORNIA CIVIL
CODE § 3439.04(A)(1)
20
21
Plaintiff Stephen J. Donell, solely in his capacity as the receiver (“Plaintiff” or
22
“Receiver”) for Zola Hospice, LLC (“Zola Hospice”), a California limited liability company,
23
alleges as follows:
24
PARTIES
25
1. Plaintiff was appointed as the Receiver for Zola Hospice in the matter of CAM
26
Specialty Lending 1, Ltd. v. Zola Hospice, LLC et al., Case No. 23VECV00655 pending in the
27
Los Angeles County Superior Court, Central District, Hon. Shirley Watkins, presiding.
28
-1-
COMPLAINT
10125974.1
1 Plaintiff brings this action solely in his capacity as Receiver for Zola Hospice and not in his
2 individual capacity. Plaintiff was vested with authority to pursue actions to recover voidable
3 transfers for the benefit of the receivership estate.
4 2. Plaintiff is informed and believes that Defendant Margaret Singh is an
5 individual residing in Danville, California.
6
7 GENERAL ALLEGATIONS
8 3. Plaintiff is informed and believes that in or about May 2020, Darline Singh
9 formed Zola Hospice as a California limited liability company.
10 4. Plaintiff is informed and believes that in October 2022, Zola Hospice entered
11 into a Master Non-Recourse Factoring and Security Agreement with CAM Specialty Lending
12 1, Ltd. (the “Lender”) under which the Lender contracted to purchase certain of Zola
13 Hospice’s accounts by advancing Zola Hospice $3 million.
14 5. Plaintiff is informed and believes that Zola Hospice obtained the $3 million by
15 providing false documents and information to the Lender, including a Certification of Officers
16 that falsely represented that Zola Hospice had acquired another company, a false $1.5 million
17 check that allegedly showed that Zola Hospice had worked with Medicare, a false bank
18 statement that allegedly reflected Zola Hospice’s business volume, and an organizational chart
19 that identified at least one party who did not work with Zola Hospice.
20 6. Plaintiff is informed that after Zola Hospice obtained the funds from the
21 Lender, no receivables came from Medicare and the Lender received no accounts from Zola
22 Hospice. Instead, Darline Singh caused Zola Hospice to pay for various personal expenses for
23 which Zola Hospice received no benefit whatsoever.
24 7. Plaintiff is informed and believes that on or about November 10, 2022, Darline
25 Singh caused Zola Hospice to wire $65,000 to Defendant from Zola Hospice’s bank account
26 (the “Transfer”). Plaintiff is informed and believes that Zola Hospice received no benefit from
27 making the Transfer and that Zola Hospice was not indebted to Defendant. Zola Hospice was
28
-2-
COMPLAINT
10125974.1
1 insolvent when it made the Transfer, having virtually no assets and owing $3 million to the
2 Lender.
3
4 FIRST CAUSE OF ACTION
5 8. Plaintiff incorporates each and every allegation contained in paragraphs 1
6 through 7 inclusive, as though fully set forth herein.
7 9. Plaintiff is informed and believes that Zola Hospice made the Transfer in
8 November 2022.
9 10. Plaintiff is informed and believes that Zola Hospice received no benefit from
10 making the Transfer.
11 11. Plaintiff is informed and believes that when Zola Hospice made the Transfer,
12 Zola Hospice was engaged in a business for which its remaining assets were unreasonably
13 small in relation to its business and/or intended to incur or believed or reasonably should have
14 believed that it would incur debts beyond Zola Hospice’s ability to pay as they came due.
15 12. As a result, the Transfer is avoidable under California Civil Code §
16 3430.04(a)(2).
17
18 SECOND CAUSE OF ACTION
19 13. Plaintiff incorporates each and every allegation in paragraphs 1 through 7 above
20 as though fully set forth herein.
21 14. When Zola Hospice made the Transfer, Zola Hospice was indebted to the
22 Lender, among other creditors.
23 15. Plaintiff is informed and believes that Zola Hospice received no benefit from
24 making the Transfer.
25 16. Plaintiff is informed and believes that when the Transfer was made, Zola
26 Hospice was either insolvent or was rendered insolvent as a result of the Transfer.
27 17. Plaintiff is informed and believes that the Transfer is a voidable transfer under
28 California Civil Code § 3439.05.
-3-
COMPLAINT
10125974.1
1 THIRD CAUSE OF ACTION
2 18. Plaintiff incorporates each and every allegation in paragraphs 1 through 8 above
3 as though fully set forth herein.
4 19. When Zola Hospice made the Transfer to Defendant, it did so with the actual
5 intent to hinder, delay, or defraud the Lender.
6 20. Plaintiff is informed and believes that Defendant is an insider of Darline Singh.
7 The Transfer was made with funds obtained from the Lender through false pretenses and part
8 of a series of transactions that benefitted Darline Singh and did not benefit Zola Hospice or its
9 creditors. Plaintiff is informed that Zola Hospice was insolvent when it made the Transfer,
10 owing significantly more to its creditors than it had in assets. The Transfer was made shortly
11 after the funds were obtained from the Lender and Zola Hospice received no benefit from the
12 Transfer.
13 21. Plaintiff is informed and believes that Defendant did not receive the funds in
14 good faith and for a reasonably equivalent value given to Zola Hospice.
15 22. Therefore, the Transfer is voidable under California Civil Code §
16 3439.04(a)(1).
17 WHEREFORE, Plaintiff requests that this Court enter a judgment in favor of Plaintiff
18 and against Defendant in the amount of $65,000.00, plus prejudgment and postjudgment
19 interest and order such other and further relief as the Court deems just and appropriate.
20
21 Dated: February 23, 2024 RAINES FELDMAN LITTRELL LLP
22
23 By:______________________________
Kyra E. Andrassy
24 Attorneys for Stephen J. Donell, Receiver
25
26
27
28
-4-
COMPLAINT
10125974.1
Preview
Electroni callyFi led Superi or Court of CA Countyof Contra Costa 2/23/2024 6:03 PM By:K. Ji nkerson, Deputy 1 RAINES FELDMAN LITTRELL LLP Kyra E. Andrassy, SBN 207959 2 Timothy Evanston, SBN 319342 3200 Park Center Drive, Suite 250 Per local Rule, Thi s case is assi gned to 3 Costa Mesa, CA 92626 Telephone: (310) 440-4100 Judge Treat, Charles S, for all purposes. 4 Facsimile: (949) 247-3998 5 Attorneys for Stephen J. Donell, Receiver 6 7 8 SUPERIOR COURT OF THE STATE OF CALIFORNIA 9 FOR THE COUNTY OF CONTRA COSTA 10 11 STEPHEN J. DONELL, solely in his Case No.: C24-00482 capacity as the Receiver for Zola Hospice, 12 LLC, COMPLAINT: 13 Plaintiff, (1) TO AVOID AND RECOVER FRAUDULENT TRANSFER 14 v. PURSUANT TO CALIFORNIA CIVIL CODE § 3439.04(A)(2); 15 MARGARET SINGH, an individual, (2) TO AVOID AND RECOVER 16 Defendant. FRAUDULENT TRANSFER PURSUANT TO CALIFORNIA CIVIL 17 CODE § 3439.05; AND 18 (3) TO AVOID AND RECOVER FRAUDULENT TRANSFER 19 PURSUANT TO CALIFORNIA CIVIL CODE § 3439.04(A)(1) 20 21 Plaintiff Stephen J. Donell, solely in his capacity as the receiver (“Plaintiff” or 22 “Receiver”) for Zola Hospice, LLC (“Zola Hospice”), a California limited liability company, 23 alleges as follows: 24 PARTIES 25 1. Plaintiff was appointed as the Receiver for Zola Hospice in the matter of CAM 26 Specialty Lending 1, Ltd. v. Zola Hospice, LLC et al., Case No. 23VECV00655 pending in the 27 Los Angeles County Superior Court, Central District, Hon. Shirley Watkins, presiding. 28 -1- COMPLAINT 10125974.1 1 Plaintiff brings this action solely in his capacity as Receiver for Zola Hospice and not in his 2 individual capacity. Plaintiff was vested with authority to pursue actions to recover voidable 3 transfers for the benefit of the receivership estate. 4 2. Plaintiff is informed and believes that Defendant Margaret Singh is an 5 individual residing in Danville, California. 6 7 GENERAL ALLEGATIONS 8 3. Plaintiff is informed and believes that in or about May 2020, Darline Singh 9 formed Zola Hospice as a California limited liability company. 10 4. Plaintiff is informed and believes that in October 2022, Zola Hospice entered 11 into a Master Non-Recourse Factoring and Security Agreement with CAM Specialty Lending 12 1, Ltd. (the “Lender”) under which the Lender contracted to purchase certain of Zola 13 Hospice’s accounts by advancing Zola Hospice $3 million. 14 5. Plaintiff is informed and believes that Zola Hospice obtained the $3 million by 15 providing false documents and information to the Lender, including a Certification of Officers 16 that falsely represented that Zola Hospice had acquired another company, a false $1.5 million 17 check that allegedly showed that Zola Hospice had worked with Medicare, a false bank 18 statement that allegedly reflected Zola Hospice’s business volume, and an organizational chart 19 that identified at least one party who did not work with Zola Hospice. 20 6. Plaintiff is informed that after Zola Hospice obtained the funds from the 21 Lender, no receivables came from Medicare and the Lender received no accounts from Zola 22 Hospice. Instead, Darline Singh caused Zola Hospice to pay for various personal expenses for 23 which Zola Hospice received no benefit whatsoever. 24 7. Plaintiff is informed and believes that on or about November 10, 2022, Darline 25 Singh caused Zola Hospice to wire $65,000 to Defendant from Zola Hospice’s bank account 26 (the “Transfer”). Plaintiff is informed and believes that Zola Hospice received no benefit from 27 making the Transfer and that Zola Hospice was not indebted to Defendant. Zola Hospice was 28 -2- COMPLAINT 10125974.1 1 insolvent when it made the Transfer, having virtually no assets and owing $3 million to the 2 Lender. 3 4 FIRST CAUSE OF ACTION 5 8. Plaintiff incorporates each and every allegation contained in paragraphs 1 6 through 7 inclusive, as though fully set forth herein. 7 9. Plaintiff is informed and believes that Zola Hospice made the Transfer in 8 November 2022. 9 10. Plaintiff is informed and believes that Zola Hospice received no benefit from 10 making the Transfer. 11 11. Plaintiff is informed and believes that when Zola Hospice made the Transfer, 12 Zola Hospice was engaged in a business for which its remaining assets were unreasonably 13 small in relation to its business and/or intended to incur or believed or reasonably should have 14 believed that it would incur debts beyond Zola Hospice’s ability to pay as they came due. 15 12. As a result, the Transfer is avoidable under California Civil Code § 16 3430.04(a)(2). 17 18 SECOND CAUSE OF ACTION 19 13. Plaintiff incorporates each and every allegation in paragraphs 1 through 7 above 20 as though fully set forth herein. 21 14. When Zola Hospice made the Transfer, Zola Hospice was indebted to the 22 Lender, among other creditors. 23 15. Plaintiff is informed and believes that Zola Hospice received no benefit from 24 making the Transfer. 25 16. Plaintiff is informed and believes that when the Transfer was made, Zola 26 Hospice was either insolvent or was rendered insolvent as a result of the Transfer. 27 17. Plaintiff is informed and believes that the Transfer is a voidable transfer under 28 California Civil Code § 3439.05. -3- COMPLAINT 10125974.1 1 THIRD CAUSE OF ACTION 2 18. Plaintiff incorporates each and every allegation in paragraphs 1 through 8 above 3 as though fully set forth herein. 4 19. When Zola Hospice made the Transfer to Defendant, it did so with the actual 5 intent to hinder, delay, or defraud the Lender. 6 20. Plaintiff is informed and believes that Defendant is an insider of Darline Singh. 7 The Transfer was made with funds obtained from the Lender through false pretenses and part 8 of a series of transactions that benefitted Darline Singh and did not benefit Zola Hospice or its 9 creditors. Plaintiff is informed that Zola Hospice was insolvent when it made the Transfer, 10 owing significantly more to its creditors than it had in assets. The Transfer was made shortly 11 after the funds were obtained from the Lender and Zola Hospice received no benefit from the 12 Transfer. 13 21. Plaintiff is informed and believes that Defendant did not receive the funds in 14 good faith and for a reasonably equivalent value given to Zola Hospice. 15 22. Therefore, the Transfer is voidable under California Civil Code § 16 3439.04(a)(1). 17 WHEREFORE, Plaintiff requests that this Court enter a judgment in favor of Plaintiff 18 and against Defendant in the amount of $65,000.00, plus prejudgment and postjudgment 19 interest and order such other and further relief as the Court deems just and appropriate. 20 21 Dated: February 23, 2024 RAINES FELDMAN LITTRELL LLP 22 23 By:______________________________ Kyra E. Andrassy 24 Attorneys for Stephen J. Donell, Receiver 25 26 27 28 -4- COMPLAINT 10125974.1