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  • Xinying Chu et al vs Bethany Liou et al Other non-PI/PD/WD Tort Unlimited (35)  document preview
  • Xinying Chu et al vs Bethany Liou et al Other non-PI/PD/WD Tort Unlimited (35)  document preview
  • Xinying Chu et al vs Bethany Liou et al Other non-PI/PD/WD Tort Unlimited (35)  document preview
  • Xinying Chu et al vs Bethany Liou et al Other non-PI/PD/WD Tort Unlimited (35)  document preview
  • Xinying Chu et al vs Bethany Liou et al Other non-PI/PD/WD Tort Unlimited (35)  document preview
  • Xinying Chu et al vs Bethany Liou et al Other non-PI/PD/WD Tort Unlimited (35)  document preview
  • Xinying Chu et al vs Bethany Liou et al Other non-PI/PD/WD Tort Unlimited (35)  document preview
  • Xinying Chu et al vs Bethany Liou et al Other non-PI/PD/WD Tort Unlimited (35)  document preview
						
                                

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Co Oo ON DO oO RF WwW DY 19CV342173 Santa Clara — Civil STEPHEN A. SCOTT (SBN 67467) CHARLES E. TILLAGE (SBN 177983) HAYES SCOTT BONINO ELLINGSON GUSLANI SIMONSON & CLAUSE LLP 999 Skyway Road, Suite 310 San Carlos, California 94070 Telephone: (650) 637-9100 Facsimile: (650) 637-9101 Attorneys for Defendant GCRC CUPERTINO FUND, LP, AND RECEIVER GREGORY STERLING SUPERIOR COURT OF THE STATE OF CALIFORNIA COUNTY OF SANTA CLARA JUE WANG, MINGHUAN WANG, MIN DUAN, YONGHONG REN, XIUPING LIANG, YUNXIN PENG, JUNGANG YAO. QIANLONG WANG, YINJIE XIE, TINGJIE ZHONG, YANG ZHANG, YUE YU, MIJING YAO, ZHUANGZHUANG ZHANG, JIAN LI, JINGHONG YAN, NING LIU, PEIRUI LI, KAI WANG, ZISEN JIN, SUQIN JIANG, SHIGUO ZHANG, LAP TSUI, RUIQI TU, XINYING CHU, YUDAN YAN, WEIJUN ZHANG, YAN LV, XINYI WANG, SHUHONG FAN, WEI LUO, JU GAO, YUAN JI, JING DONG, YAOCONG LIU, CHENGENG QU, YINGHUI WANG, JINGHUI XIA, YONG LU, YANPING YANG, BEI HONG, DONGAO YU, MEILIN LIU, and YUANYUAN ZHANG. Plaintiffs, v. GCRC CUPERTINO FUND, LP, a California Limited Partnership, GOLDEN CALIFORNIA REGIONAL CENTER, LLC, a California Limited Liability Company, and BETHANY LIOU, an individual, Defendants. 1144283 S. Vera Electronically Filed by Superior Court of CA, County of Santa Clara, on 6/10/2020 1:56 PM Reviewed By: S. Vera Case #19CV342173 Envelope: 4438389 TELEPHONE APPEARANCE CASE NO. 19CV342173 EX PARTE APPLICATION OF DEFENDANT GCRC CUPERTINO FUND, LP AND RECEIVER GREGORY STERLING FOR AN ORDER TO APPOINT RECEIVER AND DISQUALIFY COUNSEL; OR IN THE ALTERNATIVE, AN ORDER SHORTENING TIME ON MOTION TO APPOINT RECEIVER AND DISQUALIFY COUNSEL Date: Time: Dept.: Judge: , 2020 20 Hon. Socrates P. Manoukian -1- CUPERTINO FUND’S EX PARTE APPLICATION FOR APPOINTMENT OF RECEIVER AND DISQUALIFICATION OF COUNSEL--Case No. 19CV342173Co Oo ON DO oO RF WwW DY TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD: PLEASE TAKE NOTICE that on at a.m. or as soon thereafter as counsel may be heard, in the Courtroom of the Honorable Socrates Peter Manoukian, Department 20 of the above-entitled court, located at Old Courthouse, 2nd Floor, 161 North First Street, San Jose, defendant GCRC CUPERTINO FUND, LP (“Cupertino Fund”) and Receiver Gregory Sterling (“Sterling”) will and hereby do move for the following: 1. An order to appoint Sterling as Receiver for defendant Cupertino Fund in case 19CV342173 (“Wang Action”), 2. An order disqualifying the Buchalter Firm from representing defendant Cupertino Fund in the Wang Action, OR 3. Or in the alternative, an order shortening time on motions to appoint Sterling Receiver for Cupertino Fund and to disqualify the Buchalter Firm from representing defendant Cupertino Fund. This ex parte application requesting the immediate appointment of a Receiver is made pursuant to California Code of Civil Procedure section 564(b)(1) and California Rules of Court, Rule 3.1175 on the grounds that the Court previously appointed Gregory Sterling as the Receiver to act on behalf of the Cupertino Fund in the related and now consolidated case 19CV348624 (“Gao Action”). This application requesting immediate appointment of Sterling as Receiver of Cupertino Fund in the Wang Action is urgent and necessary because the Securities and Exchange Commission, which currently holds approximately $50,000,000 of Cupertino Fund’s limited partners’ funds, may take action to disburse these funds to all limited partners causing irreparable harm to limited partners who wish to continue pursuing their pending I-526 Petitions under the EB- 5 Program. The Court’s immediate action is necessary to avoid real harm to the limited partners. This application requesting the immediate disqualification of the Buchalter Firm is urgent and necessary because Buchalter is no longer representing the interests of the Cupertino Fund and the law firm has an insurmountable conflict of interest in its representation of the Cupertino Fund as 1144283 Et CUPERTINO FUND’S EX PARTE APPLICATION FOR APPOINTMENT OF RECEIVER AND DISQUALIFICATION OF COUNSEL--Case No. 19CV342173oOo ON OO FF WD DY previously found by the Court in its December 18, 2019 Order when it appointed Mr. Sterling as the Receiver and disqualified Buchalter in the Gao Action. Counsel for plaintiffs in the Wang and Gao Actions support this requested relief. As set forth in the Declaration of Stephen A. Scott attached herewith, notice was given to the Receiver and all counsel of this ex parte application. (Scott Decl. § 15.) Pursuant to California Rules of Court 3.1202(a), plaintiffs identify the following parties and their attorneys: Gregory Sterling Receiver 15700 Winchester Boulevard Los Gatos, CA 95030 gsterling@receiversinc.com Matthew Sava REID & WISE LLC One Penn Plaza, Suite 2015 New York, NY 10119 sava@lreidwise.com Attorneys for Plaintiffs JUE WANG, at al. Michael Wachtell BUCHALTER 1000 Wilshire Boulevard, Suite 1500 Los Angeles, CA 90017 mwachtell@buchalter.com Attorneys for Defendants GOLDEN CALIFORNIA REGIONAL CENTER, LLC, and BETHANY LIOU Robert K. Lu REID & WISE LLP U.S. Bank Tower 633 West Fifth Street 26" Floor Los Angeles, CA 90071 rlu@reidwise.com Attorneys for Plaintiffs JUE WANG, at al. Julie Bonnel-Rogers STRUCTURE LAW GROUP, LLP 1754 Technology Drive, Suite 135 San Jose, CA 95110 jrogers@structurelaw.com Attorneys for Plaintiffs LONG TENG GAO, etal. Peter Bales BUCHALTER 55 Second Street, Suite 1700 San Francisco, CA 94105 pbales@buhalter.com Attorneys for Defendants GOLDEN CALIFORNIA REGIONAL CENTER, LLC, and BETHANY LIOU This application is made pursuant to this Notice, the Memorandum of Points and Authorities, the Declaration of Stephen A. Scott, pleadings filed by counsel for plaintiffs in the Wang and Gao Actions, the pleadings and records on file herein, and upon such further documents, evidence and argument as may be before the Court. Dated: June 10, 2020 HAYES SCOTT BONINO ELLINGSON GUSLANI SIMONSON & CLAUSE LLP By: AE EE "STEPHEN A. SCOTT, Attorneys for Defendant GCRC CUPERTIN FUND, LP and RECEIVER GREGORY STERLING 1144283 ae CUPERTINO FUND’S EX PARTE APPLICATION FOR APPOINTMENT OF RECEIVER AND DISQUALIFICATION OF COUNSEL--Case No. 19CV342173Co Oo ON DO oO RF WwW DY MEMORANDUM OF POINTS AND AUTHORITIES L INTRODUCTION The 81 Plaintiffs in the Wang and Gao Actions are limited partners in Cupertino Fund who each invested $555,000 for purposes of obtaining green cards through the EB-5 Program.! Defendant GOLDEN CALIFORNIA REGIONAL CENTER, LLC, a California Limited Liability Company (“GCRC”) is the general partner of Cupertino Fund, and defendant BETHANY LIOU is the sole managing member of GCRC. Plaintiffs filed their actions against GCRC and Liou alleging claims for breach of fiduciary duty and fraud for misappropriating partnership funds. Cupertino Fund was named in both actions as a nominal defendant. Buchalter appeared as counsel for all defendants. Because of Buchalter’s conflict of interest in representing the general partner, Liou individually and the Cupertino Fund, Plaintiffs in the Gao Action moved to disqualify Buchalter and have Sterling appointed Receiver to protect the limited partners’ interest in the Cupertino Fund. On December 18, 2019, Judge Peter Kirwan appointed Gregory Sterling as the Receiver for the Cupertino Fund and disqualified the Buchalter firm from representing the Cupertino Fund in the related Gao Action based on its conflict of interest in representing all 3 defendants. In its Order, the Court found “there is a direct adverse interest with the law firm of Buchalter...concurrently representing the Cupertino Fund and Defendants Bethany Liou and Golden California Regional Center LLC because there interests are conflicting given the allegations in the complaint.” (Scott Decl., § 1, December 18, 2019 Order attached hereto as Exh. A.) On March 10, 2020, the Buchalter firm confirmed that due to its disqualification from representing the Cupertino Fund in the Gao Action it was no longer “advising the GCRC Cupertino Fund LP or its limited partners now as to the EB-5 Program issues.” (Scott Decl., 95, March 10, 2020 Buchalter Correspondence attached as Exh. B, p. 3.) Because Buchalter is no longer advising the Cupertino Fund related to EB-5 issues, Gregory Sterling should be appointed as the Receiver and Buchalter should be disqualified from representing Cupertino Fund in the Wang Action. Beginning in March 2020, the parties attempted to enter a stipulation for the appointment of ' Cupertino Fund has a total of 91 limited partners. 1144283 -4- CUPERTINO FUND’S EX PARTE APPLICATION FOR APPOINTMENT OF RECEIVER AND DISQUALIFICATION OF COUNSEL--Case No. 19CV342173Co Oo ON DO oO RF WwW DY the Receiver, disqualification of Buchalter, and consolidation of the Gao and Wang cases for all purposes. Although Buchalter initially agreed to these concepts, the stipulation was never finalized because Buchalter subsequently, and without explanation, would not agree to the stipulation. (Scott Decl., { 6, See April 6, 2020 Buchalter Email and Proposed Stipulation attached as Exh. C.) On April 12, 2020, this Court entered an order consolidating the Gao and Wang matters for pretrial and discovery purposes. (Scott Decl., § 7, April 12, 2020 Order attached as Exh. D.) This application is necessary because the Receiver should be appointed to manage the affairs for all the limited partners of the Cupertino Fund who are plaintiffs in the Gao and Wang Actions. Furthermore, Buchalter has admitted that it is no longer serving the best interests of the Cupertino Fund regarding EB-5 issues—which is the primary issue for which the Cupertino Fund exists. This urgent request requires immediate action by the Court because the Securities Exchange Commission (“SEC”) may soon take action that could cause irreparable financial and legal harm to the Cupertino Fund limited partners who wish to continue pursuing their I-526 Petitions in the EB-5 Program. The immediate appointment of the Receiver and disqualification of Buchalter is therefore necessary to protect the legal and financial interests of the Cupertino Fund. IL. BACKGROUND A. The Buchalter Firm was Disqualified in Gao Action in December 2019 On January 25, 2019, the Wang Action case was filed in Santa Clara Superior Court, Case No. 19CV342173 by attorneys from Reid & Wise on behalf of a group of limited partners from Cupertino Fund against Defendants Bethany Liou and Golden California Regional Center, LLC and against GCRC Cupertino Fund, LP (as a nominal defendant). In the Wang Action, the Buchalter firm represents Defendants Bethany Liou, Golden California Regional Center, LLC and GCRC Cupertino Fund, LP. The Wang Action is not yet at issue. On May 25, 2019, the Gao Action case was filed in Santa Clara Superior Court, Case No. 19CV348624 and was filed by attorneys from Structure Law Group on behalf of a second group of limited partners from GCRC Cupertino Fund, LP against Defendants Bethany Liou and Golden California Regional Center, LLC and against GCRC Cupertino Fund, LP (as a nominal defendant). In the Gao Action, Buchalter currently represents Defendants Bethany Liou and Golden California CUPERTINO FUND’S EX PARTE APPLICATION FOR APPOINTMENT OF RECEIVER AND DISQUALIFICATION OF COUNSEL--Case No. 19CV342173Co Oo ON DO oO RF WwW DY Regional Center, LLC. The Gao Action is not yet at issue. On April 12, 2020, this court issued its Order consolidating the Gao and Wang Actions for case management and discovery, and designating the Gao Action as the lead case. On June 28, 2019, a Notice of Related Case was filed in the Wang Action and the Gao Action. On December 18, 2019, Judge Peter Kirwan issued an order in Gao Action appointing Gregory Sterling as Receiver for the Cupertino Fund and disqualifying Buchalter as legal counsel for the Cupertino Fund. The December 18, 2019 Order also authorized the Receiver to retain legal counsel to represent the Cupertino Fund in that case. On December 19 , 2019, Gregory Sterling filed his Receiver’s Oath and Bond in the amount of $10,000 pursuant to the December 18, 2019 Order and assumed his role as Receiver for the Cupertino Fund in the Gao Action. On January 8, 2020, attorney Stephen A. Scott of Hayes Scott Bonino Ellingson Guslani Simonson & Clause, LLP was retained by the Receiver and has appeared as legal counsel for the Cupertino Fund in the Gao Action. B. The Securities Exchange Commission Took Possession of Investor Funds On November 4, 2019, the SEC issued its Order Instituting Cease-and-Desist Proceedings against Defendant GCRC and Liou for their mismanagement of the Cupertino Fund. The SEC alleged that GCRC and Liou misused the Cupertino Fund assets for their own benefits in violation of the Securities Act of 1933. (Scott Decl., § 8, November 4, 2019 Order attached as Exh. E.) As part of that SEC proceeding, Defendants GCRC and Liou agreed to settle the SEC complaint by voluntarily surrendering the $50,000,000 of investor funds held by the Cupertino Fund. This urgent request requires immediate action by the Court because the SEC may soon distribute these funds to individual investors which will cause irreparable financial and legal harm to the Cupertino Fund investors who wish to continue processing their I-526 Petitions in the EB-5 Program. This is because any investor in Cupertino Fund who receives a direct distribution will lose his/her right to pursue their pending I-526 Petition. A new I-526 Petition will require payment of $900,000, instead of the $500,000 payment required for the pending petitions, and will take 1144283 -6- CUPERTINO FUND’S EX PARTE APPLICATION FOR APPOINTMENT OF RECEIVER AND DISQUALIFICATION OF COUNSEL--Case No. 19CV342173Co Oo ON DO oO RF WwW DY many years to process. Buchalter estimates it will take 10-12 years to have new I-526 Petitions considered. (Scott Decl., § 5, Exh. B, p. 3; Scott Decl., 4 8, November 4, 2019 SEC Order attached as Exh. E.) In addition, the recently received Golden Gate Global proposal stated that it would take over a decade for new petitions to be considered. (Scott Decl., { 10, June 1, 2020 Golden Gate Global Proposal, attached as Exh. G.) As indicated in Exhibit G, plaintiffs’ counsel in the Wang and Gao Actions and the Receiver have received a proposal from a developer, Golden Gate Global (“GGG”), which is well versed in the actions necessary to complete I-526 Petitions. Mr. Sterling believes this proposal, and perhaps other proposals, should be explored further, and his appointment as Receiver for the Cupertino Fund in the Consolidated Actions will provide for a unified voice to interact with the SEC and prospective developers, thereby providing protection for the legal and financial rights of limited partners who wish to pursue their I-526 Petitions. (Scott Decl., § 10, June 1, 2020 Golden Gate Global Proposal, attached as Exh. G.) Il. THE APPOINTMENT OF THE RECEIVER IN THE WANG ACTION IS IN THE BEST INTEREST OF THE PLAINTIFFS The appointment of a receiver is appropriate where necessary to protect a party’s interest in property or funds in danger of destruction, removal, or misappropriation. (CCP § 564; Maggiora v. Palo Alto. Inc. (1967) 249 Cal.App.2d 706, 710.) California Code of Civil Procedure section 564(b)(1) provides for the appointment of a receiver: “in an action ... between partners or others jointly owning or interested in any property or fund, on the motion of the plaintiff, or of any party whose right to or interest in the property or fund, or the proceeds thereof, is probable, and where it is shown that the property or fund is in danger of being lost, removed, or materially injured.” California Rule of Court, Rule 3.1175 identifies the required elements necessary to show for appointment of the Receiver: (1) The nature of the emergency and the reasons irreparable injury would be suffered by the applicant during the time necessary for a hearing on notice; (2) The names, addresses, and telephone numbers of the persons in actual possession of the property for which a receiver is requested, or of the president, manager, or principal agent of any corporation in 1144283 possession of the property; 7. CUPERTINO FUND’S EX PARTE APPLICATION FOR APPOINTMENT OF RECEIVER AND DISQUALIFICATION OF COUNSEL--Case No. 19CV342173Co Oo ON DO oO RF WwW DY (3) The use being made of the property by the persons in possession; and * * * Those elements were met when Judge Kirwan appointed Gregory Sterling as Receiver for Cupertino Fund in the Gao Action. The same justification for the appointment of Receiver exists here where the interests of the Cupertino Fund are no longer protected by Liou in her capacity as the general partner. (December 18, 2019 Order, Exh. A.) The partnership funds are being held by the SEC and distribution to the Cupertino Fund should be overseen by the Receiver without any interference by Liou or GCRC. A. The Receiver Has the Power to Take Possession of Partnership Property “A receiver is an agent and officer of the court, and is under the control and supervision of the court. [Citations.]” (City of Chula Vista v. Gutierrez (2012) 207 Cal.App.4th 681, 685.) With the supervision of the Court and pursuant to Code of Civil Procedure section 568, the Receiver has the power to take possession of partnership property: “The receiver has, under the control of the Court, power to bring and defend actions in his own name, as receiver; to take and keep possession of the property, to receive rents, collect debts, to compound for and compromise the same, to make transfers, and generally to do such acts respecting the property as the Court may authorize.” [emphasis added.] The current urgency necessitating the Court’s appointment of the Receiver concerns the SEC’s plan to distribute the $50,000,000 in partnership funds back to the limited partners. However, the limited partners seeking to maintain the Fund’s EB-5 status could potentially lose their right to obtain a green card if the partnership funds are distributed in a manner inconsistent with the rules governing EB-5 qualification. The Receiver should be allowed to take possession of the partnership funds to preserve the Fund’s EB-5 qualification status. The Receiver is in a better position to distribute the investment funds to the remaining limited partners who do not wish to proceed with the EB-5 process.” 2 Mr. Sterling understands that he must obtain approval of this court before entering into any transaction on behalf of Cupertino Fund or disbursing funds to limited partners. 1144283 -8- CUPERTINO FUND’S EX PARTE APPLICATION FOR APPOINTMENT OF RECEIVER AND DISQUALIFICATION OF COUNSEL--Case No. 19CV342173Co Oo ON DO oO RF WwW DY B. The Receiver Has the Power to Retain Counsel for the Partnership Pursuant to Rules of Court, Rule 3.1180, the Receiver has the power to retain counsel to represent the interests of the partnership. Here, with the Court’s approval in the Gao Action, the Receiver retained Stephen A. Scott from the firm Hayes Scott Bonino Ellingson Guslani Simonson & Clause, LLP. (December 18, 2019 Order, Exh. A.) For the same reasons, the Court should approve the Receiver’s retention of the Hayes Scott firm to represent the Cupertino Fund in the Wang Action. IV. THE BUCHALTER FIRM SHOULD BE DISQUALIFIED FROM REPRESENTING THE CUPERTINO FUND The Buchalter firm has confirmed that it is no longer protecting the interests of the Cupertino Fund as it is no longer “advising the GCRC Cupertino Fund LP or its limited partners now as to the EB-5S Program issues.” (March 10, 2020 Buchalter Correspondence attached as Exh. C, p. 3.) The Cupertino Fund only exists to participate in the EB-5 Program and the Fund requires legal representation to assist with securing access to the partnership funds. Because of the conflict of interest, Buchalter was properly disqualified in the Gao Action when Judge Kirwan found “there is a direct adverse interest with the law firm of Buchalter...concurrently representing the Cupertino Fund and Defendants Bethany Liou and Golden California Regional Center LLC because there interests are conflicting given the allegations in the complaint.” (December 18, 2019 Order, Exh. A.) The Hayes Scott firm was retained by the Receiver when Buchalter was disqualified. It is disqualifying for an attorney to engage in concurrent representation of clients unless the clients waive the conflict. (Cal. Rules Prof. Conduct, Rule 1.7.) A request to disqualify counsel is vested in the sound discretion of the trial court. (DP Pham, LLC v. Cheadle (2016) 246 Cal. App. 4th 653, 677.) In the absence of written consent, it is automatic or “per se” disqualification for simultaneous representation of current clients with adverse interests. (Flatt v. Superior Court (1994) 9 Cal.4th 275, 284 [a client “cannot long be expected to sustain the level of confidence and trust in counsel” when conflicting interests exist.) When ruling on a disqualification request, “[t]he paramount concern must be to preserve public trust in the scrupulous administration of justice and the integrity of the bar. The important 1144283 -9- CUPERTINO FUND’S EX PARTE APPLICATION FOR APPOINTMENT OF RECEIVER AND DISQUALIFICATION OF COUNSEL--Case No. 19CV342173Co Oo ON DO oO RF WwW DY right to counsel of one’s choice must yield to ethical considerations that affect the fundamental principles of our judicial process.” (Clark v. Superior Court (2011) 196 Cal.App.4th 37, 47-48.) Here, the limited partners in the Wang Action do not consent to Buchalter’s representation of their interest and support this application to disqualify Buchalter. (Scott Decl., {{ 6-10.) Accordingly, Buchalter should be disqualified in the Wang Action on the same basis as it was disqualified in the related and now consolidated Gao Action. Vv. ALTERNATIVELY, THE COURT CAN SHORTEN TIME FOR MOTIONS ON THE ISSUES IDENTIFIED IN THIS EX PARTE APPLICATION Pursuant to Code of Civil Procedure section 1005, all moving and supporting papers need to be served and filed at least 16 court days prior to the hearing on the motion. (Code of Civ. Proc. § 1005(b).) However, per California Rule of Court 3.1300(b), an order shortening time may be granted by the Court on a showing of good cause. “The court, on its own motion or on application for an order shortening time supported by a declaration showing good cause, may prescribe shorter times for the filing and service of papers than the times specified in Code of Civil Procedure section 1005.” Here, because of the urgency of the requested relief, i.e., appointment of Receiver and disqualification of counsel to allow Receiver to interact with the SEC and potential developers in order to protect those limited partners in the Wang and Gao Actions who wish to continue processing their 1-526 Petitions, the Court should enter an order allowing the motions for relief heard on shortened time or heard on a date convenient for the Court. VI. TEMPORARY AND PARTIAL STAY ORDER On June 4, 2020, the Court issued its Order on the Stipulated Request for Temporary and Partial Stay of Action submitted by counsel in the Wang Action. (Scott Decl., { 13, Order, Exhibit J.) Mr. Sterling and Hayes Scott were not parties or counsel to this stipulation, but we understand from Wang’s counsel that this Stipulation was primarily intended to address pending discovery issues. The Court modified the Stipulation stating, “All calendar matters (and any law & motion, CMCs etc. will be continued to 28 July 2020 at 10 am in Department 20.” (Scott Decl., {| 13.) We are unclear as to the effect of this Order on this ex parte application and relief request. However, if necessary, the exigent circumstances described herein support a modification of this Stay Order to 1144283 -10- CUPERTINO FUND’S EX PARTE APPLICATION FOR APPOINTMENT OF RECEIVER AND DISQUALIFICATION OF COUNSEL--Case No. 19CV342173Co Oo ON DO oO RF WwW DY allow hearing and granting of the requested orders on this ex parte application or, in the alternative, setting a hearing on the motion on shortened time. VII. CONCLUSION Based on the foregoing, Plaintiffs respectfully request the Court grant the requested relief: 1. An order to appoint the Receiver, Gregory Sterling, for defendant Cupertino Fund in the Wang Action; 2. An order for disqualifying counsel, the Buchalter Firm, for defendant Cupertino Fund in the Wang Action; or 3. In the alternative, an order shortening time on motions to appoint receiver for and disqualify counsel for defendant Cupertino Fund, and for an order allowing the Receiver to receive investor funds held by the Securities and Exchange Commission. Dated: June 10, 2020 HAYES SCOTT BONINO ELLINGSON GUSLANI SIMONSON & CLAUSE LLP AS AE y: STEPHEN A. SCOTT CHARLES E. TILLAGE Attorneys for Defendant GCRC CUPERTINO FUND, LP and RECEIVER GREGORY STERLING DECLARATION OF STEPHEN A. SCOTT I, Stephen A. Scott, declare as follows: 1. I am an attorney licensed to practice before all the States of California. Iama partner with the firm at Hayes, Scott, Bonino, Ellingson, Guslani, Simonson & Clause, LLP, attorneys of record for the Cupertino Fund in the Gao Action. I have personal knowledge of each matter stated herein and, if called as a witness, I could and would competently testify thereto. 2. On December 18, 2019, Judge Peter Kirwan entered his Order granting the Motion to Appoint Greg Sterling of Receivers, Inc. as Receiver of Defendant GCRC Cupertino Fund, L.P. 1144283 -ll- CUPERTINO FUND’S EX PARTE APPLICATION FOR APPOINTMENT OF RECEIVER AND DISQUALIFICATION OF COUNSEL--Case No. 19CV342173Co Oo ON DO oO RF WwW DY and disqualifying Buchalter, APC from further representation of Cupertino Fund brought by plaintiffs’ counsel in Case No. 19CV348624 ("Gao Action"). A true and correct copy of Judge Kirwan’s Order is attached hereto as Exhibit A. This Order did not address receivership or disqualification of Buchalter regarding Cupertino Fund in the Related Case No. 19CV342173 (“Wang Action”), because no motion for appointment of Receiver and disqualification of counsel was filed in the Wang Action, pending before Judge Pierce at that time. 3. Pursuant to Judge Kirwan’s December 18, 2019 Order, Sterling retained my firm, Hayes Scott, to represent Cupertino Fund in the Gao Action and our firm filed Notice of Representation of Cupertino Fund on January 8, 2020. 4. The Buchalter firm is still counsel of record for the Cupertino Fund in the Wang Action. On January 22, 2020 I participated in a telephone conference attended by the Receiver and counsel for the parties in the Gao Action to discuss issues pending in the Gao Action, including execution of a Protective Order to facilitate transfer of Cupertino Fund's books and records to Sterling, consolidation of the Gao and Wang actions and Buchalter’s continued representation of Cupertino Fund in the related Wang Action. Messrs. Bales and Wachtell of the Buchalter firm acknowledged during this call that Buchalter’s further representation of Cupertino Fund in the Wang Action was problematic in light of Judge Kirwan’s disqualification order in the Gao Action. 5. On March 10, 2020, the Buchalter firm confirmed that due to its disqualification from representing the Cupertino Fund in the Gao Action it was no longer “advising the GCRC Cupertino Fund LP or its limited partners now as to the EB-5 Program issues.” A true and correct copy of the March 10, 2020 Buchalter Correspondence is attached hereto as Exhibit B, p. 3. 6. Beginning in March 2020, the parties attempted to enter a stipulation for the appointment of the Receiver, disqualification of Buchalter, and consolidating the Gao and Wang cases for all purposes. Although Buchalter initially agreed to these concepts, the stipulation was never finalized because Buchalter subsequently, and without explanation, would not agree to the stipulation. A true and correct copy of the April 6, 2020 Buchalter Email evidencing Mr. Bales’ agreement to the stipulation is attached hereto as Exhibit C. Ue On April 12, 2020, this Court entered an order consolidating the Gao and Wang 1144283 -12- CUPERTINO FUND’S EX PARTE APPLICATION FOR APPOINTMENT OF RECEIVER AND DISQUALIFICATION OF COUNSEL--Case No. 19CV342173Co Oo ON DO oO RF WwW DY matters. In your Order, the Court noted the appointment of Sterling as Receiver, the disqualification of Buchalter and the engagement of Hayes Scott for the Cupertino Fund pursuant to Judge Kirwan December 2019 Order. The Court also noted that, “Despite repeated demands, Buchalter refuses to recuse itself as counsel of record in the Related [Wang] Action.” In addition to ruling on the Motion to Quash Subpoena, the Court issued its Order transferring the Wang Action to this Department for consolidation with the Gao Action for pretrial/discovery purposes only. A true and correct copy of the April 12, 2020 Order is attached as Exh. D. 8. On April 21, 2020, I emailed a letter to Messrs. Wachtell and Bales responding to Mr. Wachtell’s March 10, 2020 letter and requesting additional information and explanation regarding his concerns about the potential effect of the Gao and Wang Actions on the pending I-526 Petitions filed by Cupertino Fund limited partners. I also indicated that Hayes Scott was protecting time to respond to the Gao and Wang Actions on behalf of Cupertino Fund and recommended that they execute the Stipulation that had been circulated before this Court’s Order that would appoint Sterling as Receiver and Hayes Scott as counsel for Cupertino Fund in the now consolidated action. A true and correct copy of my April 21, 2020 letter is attached as Exhibit E. I have not received a response to this letter. 9. On May 21, 2020, I sent an email to Messrs. Bales and Wachtell attaching a draft Stipulation to appoint Mr. Sterling as Receiver and Hayes Scott as counsel for Cupertino Fund, a true and correct copy of which is attached as Exhibit F. I received no response to this email or requested Stipulation either. 10. As indicated by the attached Exhibit G, plaintiffs’ counsel in the Wang and Gao Actions and the Receiver have received a proposal from a developer, Golden Gate Global, which is well versed in the actions necessary to complete I-526 Petitions. Mr. Sterling believes this proposal, and perhaps other proposals, should be explored further, and his appointment as Receiver for the Cupertino Fund in the Consolidated Actions will provide for a unified voice to interact with the SEC and prospective developers, thereby providing protection for the legal and financial rights of limited partners. 11. Prior to filing this application I sent an email to Messrs. Bales and Wachtell on June 1144283 -13- CUPERTINO FUND’S EX PARTE APPLICATION FOR APPOINTMENT OF RECEIVER AND DISQUALIFICATION OF COUNSEL--Case No. 19CV342173Co Oo ON DO oO RF WwW DY 3, 2020 again attaching a Stipulation and explaining the reasons Buchalter should voluntarily agree to appoint Mr. Sterling as Receiver and Hayes Scott as counsel for Cupertino Fund in order to avoid the time and expense of this application and potential great harm that will result to those limited partners who wish to continue with their pending I-156 Petitions should the SEC decide to distribute funds to individual limited partners. A true and correct copy of this email and Stipulation is attached as Exhibit H. 12. On June 4, 2020, Peter Bales responded to my June 3, 2020 email and would not agree to the terms of the stipulation. Mr. Bales stated that his clients had not authorized the substitution of counsel and the Wang parties had recently agreed to a limited stay of the Wang Action. A true and correct copy of Mr. Bales’ June 4, 2020 email and my response is attached as Exhibit I. 13. Attached as Exhibit J is a true and correct copy of the Order issued by the Court on June 4, 2020 on the Stipulated Request for Temporary and Partial Stay of Action submitted by counsel in the Wang Action. Mr. Sterling and our office was not involved in the negotiation of this Stipulation, which I understand from Wang’s counsel was primarily motivated by pending discovery issues. The Court modified the Stipulation stating, “All calendar matters (and any law & motion, CMCs etc. will be continued to 28 July 2020 at 10 am in Department 20.” We are unclear as to the effect of this Order on this ex parte application and the relief requested. However, if necessary, the exigent circumstances described herein support a modification of this Stay Order to allow hearing and granting of the requested orders on this ex parte application or, in the alternative, setting a hearing on the motion on shortened time. 14. A true and correct copy of the motion to appoint Gregory Streeling as the Receiver and disqualify Buchalter is attached hereto as Exhibit K without the exhibits; the exhibits will be included in the filing of the motion if necessary. 15. On June 8, 2020, I emailed the Receiver and counsel for all parties before 10:00 a.m. and notified them that our office planned to appear ex parte before this Court on a time and place ordered by the Court and seek the relief stated in this ex parte application. Based on Mr. Bales June 4, 2020 email, I believe his office will appear and oppose this ex parte. Attached hereto as Exhibit 1144283 -14- CUPERTINO FUND’S EX PARTE APPLICATION FOR APPOINTMENT OF RECEIVER AND DISQUALIFICATION OF COUNSEL--Case No. 19CV342173Co Oo ON DO oO RF WwW DY K is a true and correct copy of my June 8, 2020 email. I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct. Executed on June 10, 2020 in San Ce eS Stephen A. Scott 1144283 -15- CUPERTINO FUND’S EX PARTE APPLICATION FOR APPOINTMENT OF RECEIVER AND DISQUALIFICATION OF COUNSEL--Case No. 19CV342173EXHIBIT AJulie Bonnel-Rogers, Esq. (State Bar No. 176200) Jjrogers@structurelaw.com STRUCTURE LAW GROUP, LLP 1754 Technology Drive, Suite 135 San Jose, California 95110 Telephone: (408) 441-7500 Facsimile: (408) 441-7501 Attorneys for Plaintiffs SUPERIOR COURT OF THE STATE OF CALIFORNIA COUNTY OF SANTA CLARA - UNLIMITED JURISDICTION LONG TENG GAO, HUANXI WU, XIAOBO HUANG, MINGDONG HE, JIAWEN BAO, LIUHONG LIANG, BO LYU, YINGCHAO WU, XIAOLI LU, SHAOJING WANG, JUN JING XU, ZHAOLIN ZHANG, AILING LIU, XIAOHONG SHE, RUIJIA LU, YING QIAN, JUNRU DUAN, BO WU, YIFEI GAO, SUN HAI YAN, DONGQUN LI, LIJIA LIU, FENG CHEN, YUHAO PAN, RUOYI LIANG, and ZHUANGZHUANG ZHANG Plaintiffs, v. BETHANY LIOU, an individual; GOLDEN CALIFORNIA REGIONAL CENTER, LLC, a California Limited Liability Company; GCRC CUPERTINO FUND, LP, a California Limited Partnership; and DOES 1-100, Defendants. | CASE NO. 19CV348624 [NOTICE OF RELATED CASE NO. 19CV342173 FILED JUNE 28, 2019] COURT ORDER: 1. GRANTING PLAINTIFFS’ MOTION FOR THE APPOINTMENT OF A RECEIVER; 2. GRANTING PLAINTIFFS’ MOTION TO DISQUALIFY LEGAL COUNSEL FOR DEFENDANT GCRC CUPERTINO FUND LP; 3. DENYING PLAINTIFFS’ EX PARTE APPLICATION FOR A TRO/PYOSC The Honorable Judge Peter Kirwan Complaint Filed: May 22, 2019 Trial Date: None On December 2, 2019, the Honorable Judge Peter Kirwan presiding, the continued hearings on Plaintiffs’ Motion for Receiver, Plaintiffs’ Motion to Disqualify Legal Counsel, and Plaintiffs’ Ex Parte Application for a Temporary Restraining Order/Preliminary Injunction/Order to Show Case (collectively “Motions”) came for hearing in Department 19 of the above referenced -1- ORDER GRANTING PLAINTIFFS’ MOTION FOR THE APPOINTMENT OF A RECEIVER; ORDER GRANTING PLAINTIFFS’ MOTION TO DISQUALIFY LEGAL COUNSEL; ORDER DENYING EX PARTE APPLICATION FOR TRO/PI/OSCn xn a court. Upon consideration of the Motions, supporting papers and documents, the arguments of counsel, and all other records and matters filed and before the Court, and good cause existing, IT IS HEREBY ORDERED that: 1. Plaintiffs’ Motion for the Appointment of a Receiver is GRANTED. The Court hereby appoints Gregory Sterling of Receivers, Inc., 15700 Winchester Blvd., Los Gatos, CA 95030; (408) 354-9797; as Receiver pursuant to CCP § 564 for Defendant GCRC Cupertino Fund, L.P., a California limited partnership (“Cupertino Fund”) subject to his filing his oath and bond in the amount of $10,000 as required by CCP§ 567. The Receiver is an agent of the Court and is directed and authorized to retain legal counsel for Cupertino Fund. Receiver is authorized to confer with retained legal counsel for the Cupertino Fund. The Court hereby instructs Receiver Gregory Sterling to report to the Court, and all Parties to the case, of the name/address/phone/email of legal counsel retained by the Receiver to represent him as Receiver for the Cupertino Fund no later than January 10, 2019. The Court hereby instructs legal counsel for the Cupertino Fund to report to Receiver Gregory Sterling regarding its legal representation of the Cupertino Fund. The Court hereby directs Receiver Gregory Sterling to petition the Court for instructions in the event that the Receiver has questions or concerns regarding the best interests of the Cupertino Fund. The Court hereby directs Receiver Gregory Sterling and designated counsel to copy legal counsel for Plaintiffs, and Defendants Bethany Liou and Golden California Regional Center LLC on any and all reports to, or communications with, the Court. The Court hereby grants Receiver Gregory Sterling the authority to accept the transfer of all “Books and Records” (as defined below) pertaining to the Cupertino Fund received from Defendants Bethany Liou and Golden California Regional Center LLC. The Court hereby grants Receiver Gregory Sterling the authority to review and inventory the Books and Records pertaining to the Cupertino Fund received from Defendants Bethany Liou and Golden California Regional Center LLC and the authority to confer with his retained counsel regarding the content of said Books and Records. All rights of privacy of limited partners of Cupertino Fund who are Ee ORDER GRANTING PLAINTIFFS’ MOTION FOR THE APPOINTMENT OF A RECEIVER; ORDER GRANTING PLAINTIFFS’ MOTION TO DISQUALIFY LEGAL COUNSEL; ORDER DENYING EX PARTE APPLICATION FOR TRO/PI/OSCnot Plaintiffs in this Action, are to be kept confidential by the Receiver and his counsel, and not disclosed to any other Parties in this Action, or third parties, without the express written consent of such other investors, except by an appropriate order if this Court. The Court hereby orders Defendants Bethany Liou and Golden California Regional Center LLC to turn over all “Books and Records” pertaining to Cupertino Fund to Receiver Gregory Sterling at 15700 Winchester Blvd., Los Gatos, CA 95030; (408) 354-9797, no later than December 18, 2019. For the purpose of this Order “Books and Records” shall have the same meaning and scope as defined in Section 4.5 of the Limited Partnership Agreement of Cupertino Fund and California Corporations Code §15901.11, and any and all backup documents that relate to the bookkeeping and record keeping of Cupertino Fund. The Court hereby instructs the Plaintiffs in this Action to pay the fees and costs of the Receiver Gregory Sterling, and legal counsel for the Cupertino Fund, subject to a cost-shifting motion as litigation progresses or concludes based upon the evidence. 2. Plaintiffs’ Motion for Disqualification of Legal Counsel for Defendant GCRC Cupertino Fund, LP is GRANTED. The Court finds that there is a direct adverse interest with the law firm of Buchalter, a professional corporation (“Buchalter”) concurrently representing the Cupertino Fund and Defendants Bethany Liou and Golden California Regional Center LLC because their interests are conflicting given the allegations in the complaint. The Court hereby disqualifies the law firm of Buchalter (“Buchalter”) and its attorneys from representing Defendant Cupertino Fund in this Action. 3. Plaintiffs’ Application for a Temporary Restraining Order/Preliminary Injunction/Order to Show Case is DENIED. The Court hereby denies without prejudice Plaintiffs’ Application for a Temporary Restraining Order/Preliminary Injunction/Order to Show Case enjoining Buchalter, and its attorneys from deleting, destroying, removing, altering, amending, modifying, redirecting, editing or in any way changing the files, accounts, documents, status, books and records -3- ORDER GRANTING PLAINTIFFS’ MOTION FOR THE APPOINTMENT OF A RECEIVER; ORDER GRANTING PLAINTIFFS’ MOTION TO DISQUALIFY LEGAL COUNSEL; ORDER DENYING EX PARTE APPLICATION FOR TRO/PI/OSCpertaining to their legal representation of the Cupertino Fund in any and all matters including but not limited to this Action, the Related Case and the SEC Case. The Court hereby denies without prejudice Plaintiffs’ Application for a Temporary Restraining Order/Preliminary Injunction/Order to Show Case enjoining Buchalter from refusing to make available for inspection and copying documents, books and records, pertaining the legal representation of GCRC Cupertino Fund in any and all matters inclu ing but not limited to this Action,, the Related Case and the SEC Case. The Court hereby orders Defendants Bethany Liou and Golden California Regional Center LLC to turn over all “Books and Records” pertaining to Cupertino Fund to Receiver Gregory Sterling subject to the terms and conditions specified in the Court’s Order Granting Plaintiffs’ Motion for the Appointment of a Receiver, supra. IT IS SO ORDERED. Dated: v= | 1] 14 Coe a. YO -e Hon. Judge of the Superior Court Approved as to Form: BUCHALTER -4- ORDER GRANTING PLAINTIFFS’ MOTION FOR THE APPOINTMENT OF A RECEIVER; ORDER GRANTING PLAINTIFFS’ MOTION TO DISQUALIFY LEGAL COUNSEL; ORDER DENYING EX PARTE APPLICATION FOR TRO/PI/OSCEXHIBIT BBuchalter 1000 Wilshire Boulevard Suite 1500 Los Angeles, CA 90017 213.891.0700 Phone 213.896.0400 Fax File Number: G0093-0003. 213.891.5460 Direct March 10, 2020 MWACHTELL@buchalter.com VIA FEDERAL EXPRESS And via email HAYES SCOTT Gregory Sterling Court-appointed Receiver MAR 1 1 2020 c/o Receivers Incorporated ee 15700 Winchester Blvd. wa ted P— Los Gatos, CA 95030 TIME: LO: SS Email:gsterling@receiversinc.com Stephen A. Scott, Esq. Vivian V. Countryman, Esq. Hayes Scott Bonino Ellingson Guslani Simonson & Clause, LLP 999 Skyway Road, Suite 310 San Carlos, CA 94070 Email: sscott@hayesscott.com Re: Julie Wang, et al. v. GCRC Cupertino Fund, LP, etc., et al. (Santa Clara Superior Court Case No. 19CV342173); Long Teng Gao, et al. v. Bethany Liou, etc., et al. (Santa Clara Superior Case No. 19CV348624) (collectively the “Actions”) Dear Lady and Gentlemen: On behalf of Golden California Regional Center, LLC (“GCRC”), the General Partner of GCRC Cupertino Fund, LP, a California limited partnership. I am writing to advise you of recent information that has come to our attention that is relevant and critical to your management and representation of GCRC Cupertino Fund LP. buchalter.com Los Angeles Napa Valley Orange County Portland Sacramento San Diego San Francisco Scottsdale BN 39740157v4 SeattleBuchalter Gregory Sterling Stephen A. Scott, Esq. March 10, 2020 Page 2 We are advised that on June 27, 2019 there was a meeting held of the limited partners of GCRC Cupertino Fund LP at the office of GCRC at which time a Notice and Election of Limited Partners of GCRC Cupertino Fund LP, dated June 17, 2019 was discussed that had been previously distributed to all limited partners, a copy of which is attached for your information. Prior to the meeting the limited partners received an emailed communication from GCRC inviting them to withdraw from the proposed project for GCRC Cupertino Fund LP, get their money back, or transfer to another project. A Proposal to Amend LPA was also transmitted and copies of these communications are also enclosed. The limited partners were all invited to travel to California, with all expenses paid to cover the cost of their visit. At the June mecting the limited partners were given the opportunity to discuss and participate in alternative Qualifying Investments which would give them the best opportunity to obtain approval of their 1-526 Petitions, preserve their green cards for approved Petitions, and preserve the priority dates for consideration of pending and Amended 1-526 Petitions. We understand that the plaintiffs in the Actions were represented at the June 2019 meeting by their respective attorneys who represented. that they appeared as proxies for each of their respective clients and only one other investor appeared in person. Jason Gottlieb, Esq. who represented GCRC Cupertino Fund LP, GCRC, and Bethany Liou as its manager, on immigration and SEC matters, attended by phone. We understand that several limited partners signed the Limited Partner Election forms provided and that Amended I-526 Petitions were filed by many imited partners. We also know that several limited partners who were originally named plaintiffs in the Actions withdrew from those Actions. We are further advised that due to subsequent and more recent developments in China, many more limited partners have filed Amended I-526 Petitions or intend to do so in the near future. We are informed that some Amended 1-526 Petitions were filed by limited partners after November 21, 2019 when the Capital Contribution requirements were increased from $500,000 to $900,000 and still more are yet to be filed. We do not know whether the increased Capital Contribution required for the original limited partners of GCRC Cupertino Fund LP will be the original $500,000 or $900,000 or what affect the date that the Amended 1-526 Petitions were, or may be filed, will have on their required Capital Contribution. We also assume that the limited partners who will be receiving the return of their original investments of $500,000 from the SEC may want to assign those funds to GCRC Cupertino Fund LP and its General Partner for alternative Qualifying Investments. We do not know whether the assignment of those funds, or the payment of new funds, disqualifies them from approval of their Amended I-526 Petitions. To be clear, this firm has not advised GCRC Cupertino Fund LP with regard to immigration matters, and as you know from our pleadings in the pending Actions, we deny ever having any contact with, or representing the individual limited partners at any time. Further, we were not involved in the June 2019 meeting of the limited partners discussed. This firm’s representation has solely been to defend the defendants in the pending Actions. We were not BN 39740157v4Buchalter Gregory Sterling Stephen A. Scott, Esq. March 10, 2020 Page 3 involved in the negotiations with, or agreements reached, between GCRC/Liou and the SEC. Further, we do not know the current status of what we believe are 15 outstanding approved I-526 Petitions or the status of approximately 75 pending I-526 Petitions. The plaintiffs in the Actions are seeking judicial dissolution of GCRC Cupertino Fund LP and should this occur, we are informed by qualified counsel that the limited partners of GCRC Cupertino Fund LP may lose issued green cards and their priority dates for EB-5 Program status. If they have to reapply, we are told that there is a wait time of over 10-12 years or more just to have Petitions considered. This will affect those limited partners who are not plaintiffs in cither of the Actions as well as any plaintiffs in the Actions who are still intending to seek EB-5 status. Further, due to our disqualification from representing GCRC Cupertino Fund LP in the Actions, we are not advising the GCRC Cupertino Fund LP or its limited partners now as to EB- 5 Program issues. As you are both aware the plaintiffs in the Actions through their respective attorneys are secking to have the two Actions consolidated. The plaintiffs’ attomeys have circulated a form of proposed Stipulation To Consolidate Cases which GCRC and Ms. Liou will not oppose so long as it incorporates the terms of the existing court order for the Long Teng Gao action confirming the same terms of the appointment of Mr. Sterling as Receiver for GCRC Cupertino Fund LP and the selection of Mr. Scott’s firm to serve as counsel for GCRC Cupertino Fund LP in the two yet to be consolidated Actions. We will cooperate with the Recciver and Mr. Scott’s firm as independent counsel for GCRC Cupertino Fund LP within the bounds and limitation of our representation. We feel compelled to make you aware of these facts since any action taken by the plaintiffs in the Actions to dissolve GCRC Cupertino Fund LP may disqualify any of the limited partners from obtaining EB-5 Program status, and/or maintaining the priority dates of their Amended 1-526 Petitions. BN 39740157¥4Buchalter Gregory Sterling Stephen A. Scott, Esq. March 10, 2020 Page 4 We also do not know whether any other matters that arise in connection with the pending Actions would prejudice the rights and interests of any of the limited partners of GCRC Cupertino Fund LP and we leave those issues for you to consider and deal with. Very truly yours, BUCHALTER A Profesgiopal C MLW:lea cc: Julie Rogers, Esq.-via email only Robert Lu, Esq.-via email only BN 39740157v4EXHIBIT CFrom: Bales, Peter To: Robert Lu; Stephen A, Scott; "Julie Rogers" Ce: Jessica E. Scott; Matthew Sava; Wachtell, Michael L.; gsterling@receiversinc.com Subject: RE: Cupertino Consolidation Stipulation Date: Monday, April 6, 2020 2:04:34 PM Attachments: Proposed Stip to Consolidate Cases (FINAL).pdf | thought you were since you are counsel for Plaintiffs in the lead case and circulated the latest proposed stipulation. But since you are not willing to do so, | will go ahead and do so. See attached. Thanks, Peter Buchalter Peter Bales Senior Counsel T (415) 227-