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Case Number: 18-CIV-04571
SUPERIOR COURT OF SAN MATEO COUNTY
400 County Center 1050 Mission Road
Redwood City, CA 94063 South San Francisco, CA 94080
www.sanmateocourt.org
Minute Order
CNE (USA) CORPORATION, et al vs. FANG DUANMU, et al 18-CIV-04571
02/05/2021 9:00 AM
Writ of Attachment
Hearing Result: Held
Judicial Officer: Foiles, Robert D Location: Courtroom 2J
Courtroom Clerk: Alexandrina Ortega Courtroom Reporter: Cindy DelRosario
Parties Present
Exhibits
Minutes
Journals
Case Events
- Matter is called at:; 9:19 am.
- No appearance by any parties herein or their counsel of record.
- Tentative ruling adopted and becomes order:; Plaintiffs CNE (USA) Corporation et. al.'s Application For
Right to Attach Order and Order for Issuance of a Writ of Attachment, filed 9-9-20, is GRANTED-IN-PART
and DENIED-IN-PART, as set forth below. Code Civ. Proc. 481.010 et. seq.
Plaintiffs characterize this case as one involving Defendants' conversion/theft of Plaintiffs' corporate
assets (i.e., Defendants' alleged theft of funds from Plaintiffs' corporate bank accounts). Defendants
contend the dispute centers on Plaintiffs' violation of labor and employment laws (i.e., alleged failure to
pay its California-based employees' wages).
In 2018, shortly after filing the Complaint in this case, Plaintiffs filed their first application for a writ of
attachment, seeking to attach property owned by two of the named Defendants- Fang Duanmu and Jun
Fu. The Court granted Plaintiffs' first application in-part as to Defendant Duanmu, and denied the
application as to Defendant Fu. See 10-10-18 Order (providing a general summary of the case facts,
which the Court will not repeat).
On 9-9-20, Plaintiffs filed their present second application for a writ of attachment, this time seeking to
attach real property owned by Defendants Xie and Zhao, and again requesting attachment of Defendant
Fu's real property in Dublin, Ca. (the same property Plaintiffs sought to attach in the first application).
With this second application, Plaintiffs offer evidence that Defendants knowingly and without
permission took/converted money from Plaintiffs' bank accounts. For purposes of the present
application, Plaintiffs contend Defendants Fu, Zhao, and Xie took and/or received the following amounts
from Plaintiffs' bank accounts: (a) Fu -"at least $316,667"; (b) Zhao-$476,645 ($163,645 paid directly to
Zhao, plus $313,000 paid by Jing Hua (another entity affiliated with Plaintiffs) to Zhao's personal
business (a travel agency); and (c) Xie-"at least $113,579." The Court addresses each Defendant
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Case Number: 18-CIV-04571
separately.
As an initial matter, the Court notes that Plaintiffs' present (second) application for a writ of attachment
seeks to attach $2,023,562.16, which is the same dollar figure Plaintiffs sought to attach in their first (9-
5-18) application. The $2,023,562.16 figure is based on the total sum that Defendants Duanmu, Fu,
Zhao, and Xie, collectively, received. Per the evidence, the majority of the $2,023,562.16 was paid to
Defendant Duanmu. Thus, the $2,023,562.16 Plaintiffs seek to attach is considerably more than the
amounts allegedly paid to Defendants Fu, Zhao, and Xie. Plaintiff seek the entire $2,023,562.16 for
purposes of attachment based on their contention that Fu, Zhao, and Xie participated in the conversion
of the entire $2,023,562.16, and thus should be held jointly and severally liable for the entire amount,
even though they personally received only a portion of it. As stated, the Court previously granted
Plaintiffs' initial application to attach property belonging to Defendant Duanmu, in the amount of
$1,000,000. See 10-10-18 Order. Thus, the Court has already authorized attachment of $1,000,000 of
the $2,023,562.16 that Plaintiffs seek to attach in the present application.
Application for Writ of Attachment against Defendant Jun Fu
As to Defendant Jun Fu, Plaintiffs' application is DENIED for non-compliance with Code Civ. Proc.
1008(b). As stated, Plaintiffs previously applied for a writ of attachment against Fu in 2018, when they
sought to attach the same real property owned by Fu in Dublin, Ca. The Court denied that application.
See 10-10-18 Order. Code Civ. Proc. Sect. 1008(b) permits Plaintiffs to file a subsequent application for
the same relief based upon "new or different facts, circumstances, or law." Per the statute, however,
any subsequent application seeking the same relief "shall" be supported by an affidavit stating "what
application was made before, when and to what judge, what orders or decisions were made, and what
new or different facts, circumstances, or law are claimed to be shown." Sect. 1008(b). Plaintiffs' moving
papers were not supported by the required affidavit/declaration, which alone defeats this application as
to Defendant Fu. Plaintiffs' moving papers did not even mention the fact they previously sought the
same relief against Fu. Further, the primary piece of evidence supporting the motion, the Declaration of
Guohong Xue, appears to be nearly identical to the declaration that Mr. Xue submitted in 2018 in
support of Plaintiffs' first request to attach Fu's property. See Natenson Decl., Ex. B (comparing the two
Xue declarations). For the most part, as to Defendant Fu, it appears Plaintiffs are re-hashing the same
evidence and arguments presented to the Court in 2018.
After Defendants filed their Opposition brief noting that Plaintiffs did not comply with Sect. 1008(b) as to
Defendant Fu, Plaintiffs filed Reply papers that include the 10-29-20 Azarmi Decl., Par. 7-9, which
acknowledge that Plaintiffs sought the same relief against Fu previously. This Reply declaration not
comply with Sect. 1008(b), the purpose of which is to require moving parties to disclose, up front, the
fact they previously sought from the Court the same relief. While the Court has the discretion to
consider new evidence raised in Reply papers, in general, replies may not be used to raise new
arguments or introduce new evidence, because such consideration would either deprive the opposing
party of an opportunity to respond or require the effort and delay of additional brief by permission. See
Marriage of Khera & Sameer (2012) 206 Cal.App.4th 1467, 1477. The Court has considered the evidence
submitted with Plaintiffs' Reply papers. However, the belated "disclosure" of Plaintiffs' prior application
does not meet Sect. 1008(b)'s requirements. Further, even if the 10-29-20 Azarmi declaration had been
filed with the moving papers, it does not identify "what order or decisions" the Court previously
rendered as to Defendant Fu-namely, that Plaintiffs' prior application was denied.
The Court acknowledges the 2-15-18 draft letter to Plaintiffs that Fu apparently wrote in March 2018,
but never sent. Azarmi Decl., Ex. PP. Plaintiffs also offer deposition testimony from Xie and Zhao stating
they only saw Fu in the office on a few occasions. 10-29-20 Azarmi Decl., Par. 9. This evidence appears
to constitute "new or different" evidence that Plaintiffs did not and could not have presented with their
2018 application. However, it does not overcome the procedural defects identified above. Thus, as to
Defendant Fu, the application is denied.
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Case Number: 18-CIV-04571
Application for Writ of Attachment against Defendant Yu Zhao
As to Defendant Zhao, Plaintiffs' application is GRANTED-IN-PART in the amount of $163,645, contingent
on Zhao agreeing to deposit another $313,000 in an escrow account (see discussion below). Plaintiffs
contend Zhao unlawfully received a total of $476,645, consisting of (a) $163,645 in checks from CNE
California's bank accounts paid directly to him, and (b) $313,000 paid by Jing Hua to Zhao's personal
business (a travel agency). Having reviewed the evidence, the Court grants the application in part, and
authorizes attachment of Zhao's Oakley, Ca. property in the amount of $163,645.
With respect to Plaintiffs' conversion claim against Defendants, the Court finds Plaintiff's application
satisfies the requirements of Sect. 483.010(a), namely, (1) the claim upon which the attachment is based
is one upon which an attachment may be issued (i.e., conversion), (2) without deciding the ultimate
merits of Plaintiffs' claim, Plaintiffs have established the probable validity of the claim (see Code Civ.
Proc. Sect. 481.190, "more probable than not..."), (3) the attachment is not sought for a purpose other
than the recovery on the claim upon which the attachment is based, and (4) the amount to be secured is
greater than zero. Code Civ. Proc. Sect. 483.090(a). Viewed collectively, the evidence suggests it is likely
than not that Zhao received $163,645 of CNE California's money, that he refused to return it upon
request, that Plaintiffs did not consent to its taking, and that Plaintiffs were harmed. CACI 2100 (jury
instruction for conversion). From late 2017 to 2018, Plaintiffs demanded that the funds Defendants
received be returned, but they refused. Xue Decl., 24, 25, Exs. T, U, V, W. As noted in the briefing,
conversion is a "strict liability" tort, meaning it can be established without showing wrongful intent.
Multani v. Knight (2018) 23 Cal.App.5th 837, 853.
Further, while the ultimate validity of Defendants' counterclaims has yet to be determined, for purposes
of this application, the Court finds that Defendants have not met their burden of proving the probable
validity of any "offset" under the attachment statutes. Defendants' claimed offset appears to hinge on
the validity of their breach of contract counterclaim (allegation that Plaintiffs breached their
employment agreements). But the evidence supporting Defendants' breach of contract counterclaims
appears problematic. They point to alleged offer letters that are unsigned by Plaintiffs, and do not even
state a salary. Each Defendants' declaration states that their employee agreement with CNE California
was approved by Guoping Liu, CEO of CNE China, but there is no evidence they know that to be true.
Zhao testified he had never met or communicated with Guoping Liu and did not know if Liu approved his
agreement. Azarmi Reply Decl. 4, Ex. 3 at 25:9-23. There is also other evidence casting serious doubt
on the employment letters' legitimacy. Azarmi Reply Decl. 2, Ex. 1 (5-25-17 e-mail from Sheppard
Mullin attorney Tony Mou to Xie, attaching an offer letter template, which is dated well over a year after
Defendants allegedly starting working for Plaintiffs, which again raises questions about the offer letters'
legitimacy). Id. 4, Ex. 3 at 87:2-12. This is not to say that Defendants do not have some type of valid
claim for compensation for services rendered. But based on the evidence, they have not proven the
probable validity of their breach of contract claims, or any other claim that would warrant an "offset"
under the attachment statutes. Further, even if Defendants are entitled to some compensation, given
the questionable validity of the alleged written employment agreements, the amount of any
compensation due would likely not be readily ascertainable or reasonably certain, and thus would not
qualify for an offset.
With respect to the $313,000 paid by Jing Hua to Zhao's travel agency, it appears Zhao essentially
offered to have these funds secured in an escrow-type account, pending the outcome of this case. If
Zhao agrees to do so, presumably this application will be rendered moot with respect to that $313,000.
As Plaintiffs' themselves state in their papers: "[t]he usual and main purpose of an attachment is to
secure and insure the payment of any judgment ... in order that the ends of successful litigation are not
fruitlessly pursued or frustrated. That is precisely the reason for Plaintiffs' request for attachment." Plts.'
MPAs at 14, citing Loeb & Loeb v. Beverly Glen Music, Inc. 166 Cal.App.3d 1110, 1118 (1985). Per the
parties' papers, after this litigation commenced, Zhao prepared a cashier's check payable to Jing Hua for
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Case Number: 18-CIV-04571
the entire $313,000 that Jing Hu paid to Zhao's travel agency (Zhao claims these funds were prepayment
for services that ultimately were never rendered). Azarmi Decl., 15-16, Ex. NN, OO. Zhao claims that
given the pending lawsuit, he gave the cashier's check to his attorney (James Cai), who is currently
holding it pending the outcome of this case. Zhao apparently also produced a copy of the check to
Plaintiffs. Zhao's counsel also suggested interpleading the $313,000 with the Court. See Plts' MPAs at
10. Assuming these funds are properly secured in an escrow account, there is no basis for attachment of
those funds.
Within 10 days of this Order, Defendant Zhao shall either agree to deposit the referenced $313,000 into
an escrow account (or some other arrangement agreeable to Plaintiffs) to insure its availability to satisfy
any eventual judgment in favor of Plaintiffs, otherwise the Court will grant the application against Zhao
in the amount of $420,000 (the estimated equity in Zhao's Oakley, Ca. property, see 9-9-20 Azarmi
Decl.).
Application for Writ of Attachment against Defendant Qiaoling Xie
As to Defendant Xie, Plaintiffs' application is GRANTED-IN-PART in the amount of $113,579. Plaintiffs
contend that in 2017, Xie wrote unauthorized checks to herself from CNE California's bank account
totaling $113,579. Plaintiffs also argue Xie facilitated the conversion of the entire $2,023,562.16 paid to
Defendants, because Xie was the person authorizing wire transfers and signing checks, and thus Xie
should be held jointly and severally liable for the entire $2,023,562.16 received by the various
Defendants. For the same reasons stated above with respect to Defendant Zhao, Plaintiffs have proven
the "probable validity" of their conversion claim against Xie, and Xie has not proven the probable validity
of any offset.
The Court declines to authorize attachment against Xie, however, of the entire $2,023,562.16. First, per
the proffered evidence, Xie's Fremont, Ca. property only has about $500,000 in equity. 9-9-20 Azarmi
Decl. Further, many of Defendants' alleged wrongful acts occurred after Xie left the company in 2017.
Xie's potential liability for payments made to Defendants Duanmu, Fu, and Zhao after Xie resigned and
left the company (i.e., checks that Xie signed at the time she resigned, but which were later
completed/filled in by Duanmu,) is questionable. While Xie admits to approving wire transfers between
the CNE-USA and CNE-Calif. bank accounts, and admits to giving Duanmu several signed, blank checks
when Xie resigned, Xie claims she did so at Duanmu's instruction, and no funds were actually
withdrawn/taken from Plaintiffs' accounts at that time. See 9-9-20 Decl. of Guogong Xue. Thus, Xie's
alleged liability for funds paid to the other named Defendants is unclear.
Plaintiffs argue Xie may have converted an additional $52,969 in checks that Xie received from Jing Hua
for her alleged "consulting" services. Azarmi Decl. 14, Ex. MM at 54:12-55:16, 61:8-18, Ex. 25. But
Plaintiffs concede that whether Xie was entitled to receive the $52,969 is unclear, and thus Plaintiffs
have not included this $52,969 as part of their attachment request. Plts.' 9-9-20 MPAs at 10.
This Order is contingent on Plaintiffs first filing an undertaking in the amount of $10,000 (Code Civ. Proc.
Sect. 484.090; 489.210; 489.220), and preparing an Order on Judicial Council form AT-120 for the Court's
signature, consistent with this Order.
Xie's and Fu's 10-30-20 Objections to Evidence are OVERRULED. Xie's and Fu's contention that Plaintiffs'
Reply brief was "untimely" filed under Code Civ. Proc. Sect. 1005(b) lacks merit. Sect. 1005(b) does not
apply. Reply briefs in support of an application for a writ of attachment may be filed two court days
prior to the hearing. See Code Civ. Proc. Sect. 484.060(c). As to the "new evidence" filed with Plaintiffs'
reply papers, while the Court has considered this "new evidence," it has had had no bearing on the
Court's ruling.
If the tentative ruling is uncontested, it shall become the order of the Court. Thereafter, counsel for
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Case Number: 18-CIV-04571
Defendants shall prepare a written order consistent with the Court's ruling for the Court's signature,
pursuant to California Rules of Court, Rule 3.1312, and provide written notice of the ruling to all parties
who have appeared in the action, as required by law and the California Rules of Court.
Others
Comments:
Future Hearings and Vacated Hearings
5
Preview
Case Number: 18-CIV-04571 SUPERIOR COURT OF SAN MATEO COUNTY 400 County Center 1050 Mission Road Redwood City, CA 94063 South San Francisco, CA 94080 www.sanmateocourt.org Minute Order CNE (USA) CORPORATION, et al vs. FANG DUANMU, et al 18-CIV-04571 02/05/2021 9:00 AM Writ of Attachment Hearing Result: Held Judicial Officer: Foiles, Robert D Location: Courtroom 2J Courtroom Clerk: Alexandrina Ortega Courtroom Reporter: Cindy DelRosario Parties Present Exhibits Minutes Journals Case Events - Matter is called at:; 9:19 am. - No appearance by any parties herein or their counsel of record. - Tentative ruling adopted and becomes order:; Plaintiffs CNE (USA) Corporation et. al.'s Application For Right to Attach Order and Order for Issuance of a Writ of Attachment, filed 9-9-20, is GRANTED-IN-PART and DENIED-IN-PART, as set forth below. Code Civ. Proc. 481.010 et. seq. Plaintiffs characterize this case as one involving Defendants' conversion/theft of Plaintiffs' corporate assets (i.e., Defendants' alleged theft of funds from Plaintiffs' corporate bank accounts). Defendants contend the dispute centers on Plaintiffs' violation of labor and employment laws (i.e., alleged failure to pay its California-based employees' wages). In 2018, shortly after filing the Complaint in this case, Plaintiffs filed their first application for a writ of attachment, seeking to attach property owned by two of the named Defendants- Fang Duanmu and Jun Fu. The Court granted Plaintiffs' first application in-part as to Defendant Duanmu, and denied the application as to Defendant Fu. See 10-10-18 Order (providing a general summary of the case facts, which the Court will not repeat). On 9-9-20, Plaintiffs filed their present second application for a writ of attachment, this time seeking to attach real property owned by Defendants Xie and Zhao, and again requesting attachment of Defendant Fu's real property in Dublin, Ca. (the same property Plaintiffs sought to attach in the first application). With this second application, Plaintiffs offer evidence that Defendants knowingly and without permission took/converted money from Plaintiffs' bank accounts. For purposes of the present application, Plaintiffs contend Defendants Fu, Zhao, and Xie took and/or received the following amounts from Plaintiffs' bank accounts: (a) Fu -"at least $316,667"; (b) Zhao-$476,645 ($163,645 paid directly to Zhao, plus $313,000 paid by Jing Hua (another entity affiliated with Plaintiffs) to Zhao's personal business (a travel agency); and (c) Xie-"at least $113,579." The Court addresses each Defendant 1 Case Number: 18-CIV-04571 separately. As an initial matter, the Court notes that Plaintiffs' present (second) application for a writ of attachment seeks to attach $2,023,562.16, which is the same dollar figure Plaintiffs sought to attach in their first (9- 5-18) application. The $2,023,562.16 figure is based on the total sum that Defendants Duanmu, Fu, Zhao, and Xie, collectively, received. Per the evidence, the majority of the $2,023,562.16 was paid to Defendant Duanmu. Thus, the $2,023,562.16 Plaintiffs seek to attach is considerably more than the amounts allegedly paid to Defendants Fu, Zhao, and Xie. Plaintiff seek the entire $2,023,562.16 for purposes of attachment based on their contention that Fu, Zhao, and Xie participated in the conversion of the entire $2,023,562.16, and thus should be held jointly and severally liable for the entire amount, even though they personally received only a portion of it. As stated, the Court previously granted Plaintiffs' initial application to attach property belonging to Defendant Duanmu, in the amount of $1,000,000. See 10-10-18 Order. Thus, the Court has already authorized attachment of $1,000,000 of the $2,023,562.16 that Plaintiffs seek to attach in the present application. Application for Writ of Attachment against Defendant Jun Fu As to Defendant Jun Fu, Plaintiffs' application is DENIED for non-compliance with Code Civ. Proc. 1008(b). As stated, Plaintiffs previously applied for a writ of attachment against Fu in 2018, when they sought to attach the same real property owned by Fu in Dublin, Ca. The Court denied that application. See 10-10-18 Order. Code Civ. Proc. Sect. 1008(b) permits Plaintiffs to file a subsequent application for the same relief based upon "new or different facts, circumstances, or law." Per the statute, however, any subsequent application seeking the same relief "shall" be supported by an affidavit stating "what application was made before, when and to what judge, what orders or decisions were made, and what new or different facts, circumstances, or law are claimed to be shown." Sect. 1008(b). Plaintiffs' moving papers were not supported by the required affidavit/declaration, which alone defeats this application as to Defendant Fu. Plaintiffs' moving papers did not even mention the fact they previously sought the same relief against Fu. Further, the primary piece of evidence supporting the motion, the Declaration of Guohong Xue, appears to be nearly identical to the declaration that Mr. Xue submitted in 2018 in support of Plaintiffs' first request to attach Fu's property. See Natenson Decl., Ex. B (comparing the two Xue declarations). For the most part, as to Defendant Fu, it appears Plaintiffs are re-hashing the same evidence and arguments presented to the Court in 2018. After Defendants filed their Opposition brief noting that Plaintiffs did not comply with Sect. 1008(b) as to Defendant Fu, Plaintiffs filed Reply papers that include the 10-29-20 Azarmi Decl., Par. 7-9, which acknowledge that Plaintiffs sought the same relief against Fu previously. This Reply declaration not comply with Sect. 1008(b), the purpose of which is to require moving parties to disclose, up front, the fact they previously sought from the Court the same relief. While the Court has the discretion to consider new evidence raised in Reply papers, in general, replies may not be used to raise new arguments or introduce new evidence, because such consideration would either deprive the opposing party of an opportunity to respond or require the effort and delay of additional brief by permission. See Marriage of Khera & Sameer (2012) 206 Cal.App.4th 1467, 1477. The Court has considered the evidence submitted with Plaintiffs' Reply papers. However, the belated "disclosure" of Plaintiffs' prior application does not meet Sect. 1008(b)'s requirements. Further, even if the 10-29-20 Azarmi declaration had been filed with the moving papers, it does not identify "what order or decisions" the Court previously rendered as to Defendant Fu-namely, that Plaintiffs' prior application was denied. The Court acknowledges the 2-15-18 draft letter to Plaintiffs that Fu apparently wrote in March 2018, but never sent. Azarmi Decl., Ex. PP. Plaintiffs also offer deposition testimony from Xie and Zhao stating they only saw Fu in the office on a few occasions. 10-29-20 Azarmi Decl., Par. 9. This evidence appears to constitute "new or different" evidence that Plaintiffs did not and could not have presented with their 2018 application. However, it does not overcome the procedural defects identified above. Thus, as to Defendant Fu, the application is denied. 2 Case Number: 18-CIV-04571 Application for Writ of Attachment against Defendant Yu Zhao As to Defendant Zhao, Plaintiffs' application is GRANTED-IN-PART in the amount of $163,645, contingent on Zhao agreeing to deposit another $313,000 in an escrow account (see discussion below). Plaintiffs contend Zhao unlawfully received a total of $476,645, consisting of (a) $163,645 in checks from CNE California's bank accounts paid directly to him, and (b) $313,000 paid by Jing Hua to Zhao's personal business (a travel agency). Having reviewed the evidence, the Court grants the application in part, and authorizes attachment of Zhao's Oakley, Ca. property in the amount of $163,645. With respect to Plaintiffs' conversion claim against Defendants, the Court finds Plaintiff's application satisfies the requirements of Sect. 483.010(a), namely, (1) the claim upon which the attachment is based is one upon which an attachment may be issued (i.e., conversion), (2) without deciding the ultimate merits of Plaintiffs' claim, Plaintiffs have established the probable validity of the claim (see Code Civ. Proc. Sect. 481.190, "more probable than not..."), (3) the attachment is not sought for a purpose other than the recovery on the claim upon which the attachment is based, and (4) the amount to be secured is greater than zero. Code Civ. Proc. Sect. 483.090(a). Viewed collectively, the evidence suggests it is likely than not that Zhao received $163,645 of CNE California's money, that he refused to return it upon request, that Plaintiffs did not consent to its taking, and that Plaintiffs were harmed. CACI 2100 (jury instruction for conversion). From late 2017 to 2018, Plaintiffs demanded that the funds Defendants received be returned, but they refused. Xue Decl., 24, 25, Exs. T, U, V, W. As noted in the briefing, conversion is a "strict liability" tort, meaning it can be established without showing wrongful intent. Multani v. Knight (2018) 23 Cal.App.5th 837, 853. Further, while the ultimate validity of Defendants' counterclaims has yet to be determined, for purposes of this application, the Court finds that Defendants have not met their burden of proving the probable validity of any "offset" under the attachment statutes. Defendants' claimed offset appears to hinge on the validity of their breach of contract counterclaim (allegation that Plaintiffs breached their employment agreements). But the evidence supporting Defendants' breach of contract counterclaims appears problematic. They point to alleged offer letters that are unsigned by Plaintiffs, and do not even state a salary. Each Defendants' declaration states that their employee agreement with CNE California was approved by Guoping Liu, CEO of CNE China, but there is no evidence they know that to be true. Zhao testified he had never met or communicated with Guoping Liu and did not know if Liu approved his agreement. Azarmi Reply Decl. 4, Ex. 3 at 25:9-23. There is also other evidence casting serious doubt on the employment letters' legitimacy. Azarmi Reply Decl. 2, Ex. 1 (5-25-17 e-mail from Sheppard Mullin attorney Tony Mou to Xie, attaching an offer letter template, which is dated well over a year after Defendants allegedly starting working for Plaintiffs, which again raises questions about the offer letters' legitimacy). Id. 4, Ex. 3 at 87:2-12. This is not to say that Defendants do not have some type of valid claim for compensation for services rendered. But based on the evidence, they have not proven the probable validity of their breach of contract claims, or any other claim that would warrant an "offset" under the attachment statutes. Further, even if Defendants are entitled to some compensation, given the questionable validity of the alleged written employment agreements, the amount of any compensation due would likely not be readily ascertainable or reasonably certain, and thus would not qualify for an offset. With respect to the $313,000 paid by Jing Hua to Zhao's travel agency, it appears Zhao essentially offered to have these funds secured in an escrow-type account, pending the outcome of this case. If Zhao agrees to do so, presumably this application will be rendered moot with respect to that $313,000. As Plaintiffs' themselves state in their papers: "[t]he usual and main purpose of an attachment is to secure and insure the payment of any judgment ... in order that the ends of successful litigation are not fruitlessly pursued or frustrated. That is precisely the reason for Plaintiffs' request for attachment." Plts.' MPAs at 14, citing Loeb & Loeb v. Beverly Glen Music, Inc. 166 Cal.App.3d 1110, 1118 (1985). Per the parties' papers, after this litigation commenced, Zhao prepared a cashier's check payable to Jing Hua for 3 Case Number: 18-CIV-04571 the entire $313,000 that Jing Hu paid to Zhao's travel agency (Zhao claims these funds were prepayment for services that ultimately were never rendered). Azarmi Decl., 15-16, Ex. NN, OO. Zhao claims that given the pending lawsuit, he gave the cashier's check to his attorney (James Cai), who is currently holding it pending the outcome of this case. Zhao apparently also produced a copy of the check to Plaintiffs. Zhao's counsel also suggested interpleading the $313,000 with the Court. See Plts' MPAs at 10. Assuming these funds are properly secured in an escrow account, there is no basis for attachment of those funds. Within 10 days of this Order, Defendant Zhao shall either agree to deposit the referenced $313,000 into an escrow account (or some other arrangement agreeable to Plaintiffs) to insure its availability to satisfy any eventual judgment in favor of Plaintiffs, otherwise the Court will grant the application against Zhao in the amount of $420,000 (the estimated equity in Zhao's Oakley, Ca. property, see 9-9-20 Azarmi Decl.). Application for Writ of Attachment against Defendant Qiaoling Xie As to Defendant Xie, Plaintiffs' application is GRANTED-IN-PART in the amount of $113,579. Plaintiffs contend that in 2017, Xie wrote unauthorized checks to herself from CNE California's bank account totaling $113,579. Plaintiffs also argue Xie facilitated the conversion of the entire $2,023,562.16 paid to Defendants, because Xie was the person authorizing wire transfers and signing checks, and thus Xie should be held jointly and severally liable for the entire $2,023,562.16 received by the various Defendants. For the same reasons stated above with respect to Defendant Zhao, Plaintiffs have proven the "probable validity" of their conversion claim against Xie, and Xie has not proven the probable validity of any offset. The Court declines to authorize attachment against Xie, however, of the entire $2,023,562.16. First, per the proffered evidence, Xie's Fremont, Ca. property only has about $500,000 in equity. 9-9-20 Azarmi Decl. Further, many of Defendants' alleged wrongful acts occurred after Xie left the company in 2017. Xie's potential liability for payments made to Defendants Duanmu, Fu, and Zhao after Xie resigned and left the company (i.e., checks that Xie signed at the time she resigned, but which were later completed/filled in by Duanmu,) is questionable. While Xie admits to approving wire transfers between the CNE-USA and CNE-Calif. bank accounts, and admits to giving Duanmu several signed, blank checks when Xie resigned, Xie claims she did so at Duanmu's instruction, and no funds were actually withdrawn/taken from Plaintiffs' accounts at that time. See 9-9-20 Decl. of Guogong Xue. Thus, Xie's alleged liability for funds paid to the other named Defendants is unclear. Plaintiffs argue Xie may have converted an additional $52,969 in checks that Xie received from Jing Hua for her alleged "consulting" services. Azarmi Decl. 14, Ex. MM at 54:12-55:16, 61:8-18, Ex. 25. But Plaintiffs concede that whether Xie was entitled to receive the $52,969 is unclear, and thus Plaintiffs have not included this $52,969 as part of their attachment request. Plts.' 9-9-20 MPAs at 10. This Order is contingent on Plaintiffs first filing an undertaking in the amount of $10,000 (Code Civ. Proc. Sect. 484.090; 489.210; 489.220), and preparing an Order on Judicial Council form AT-120 for the Court's signature, consistent with this Order. Xie's and Fu's 10-30-20 Objections to Evidence are OVERRULED. Xie's and Fu's contention that Plaintiffs' Reply brief was "untimely" filed under Code Civ. Proc. Sect. 1005(b) lacks merit. Sect. 1005(b) does not apply. Reply briefs in support of an application for a writ of attachment may be filed two court days prior to the hearing. See Code Civ. Proc. Sect. 484.060(c). As to the "new evidence" filed with Plaintiffs' reply papers, while the Court has considered this "new evidence," it has had had no bearing on the Court's ruling. If the tentative ruling is uncontested, it shall become the order of the Court. Thereafter, counsel for 4 Case Number: 18-CIV-04571 Defendants shall prepare a written order consistent with the Court's ruling for the Court's signature, pursuant to California Rules of Court, Rule 3.1312, and provide written notice of the ruling to all parties who have appeared in the action, as required by law and the California Rules of Court. Others Comments: Future Hearings and Vacated Hearings 5