According to Aish.com: “Rabbi Chanan (Antony) Gordon, is a former student of Rav Noach Weinberg, Z’tl and Aish Hatorah, Jerusalem. A Fulbright Scholar and graduate of the Harvard Law School, Chanan has been very involved in outreach since leaving Aish Hatorah including having co-authored (together with Richard Horowitz) the oft published demographic study and accompanying chart entitled “Will Your Grandchild Be Jewish.””
Goldman v Gordon adversary complaint word format
Case No: 2:13-bk-14465-PC
Adversary Complaint. Entered: July 19, 2014
BRENT J. GOLDMAN (“Plaintiff ‘ or “Creditor”) files his complaint to determine dischargeability of debt against ANTONY GORDON (“Defendant” or “Debtor”) and respectfully alleges as follows:
6. As detailed below, Defendant has knowingly and intentionally engaged in a pattern of fraud and deceit through misrepresentation of facts, theft, embezzlement, and bad faith delay tactics, as well as breach of fiduciary duty, that mandates that his debt to Plaintiff deemed nondischargeable.
7. Plaintiff is informed and believes, and upon such basis alleges, that there exists, and at all times herein mention there existed, a unity of interest and ownership between Defendant and Stealth Capital Management, LLC (“Stealth Capital”), such that any individuality and separateness between them ceased, and they are the alter egos of each other in that they used the assets of each other for their personal uses, caused assets of each other to be transferred to each other without adequate consideration, and withdrew funds from the bank accounts of each other for their personal use or benefit. Further, they completely controlled, dominated, managed, and operated each other and intermingled their assets to suit the convenience of each of them. Further Stealth Capital is and at all times mentioned was a mere shell, instrumentality and conduit through which Defendant carried on his business exercising complete control and dominance of such business to an extent that any individuality or separateness of each other does not, and at all times herein mentioned did not, exist. Adherence to the fiction of the separate existence of each as a person or an entity would permit an abuse of the corporate privilege and would sanction fraud and promote injustice.
A. Plaintiff is introduced to Defendant
8. On October 7, 2012, Plaintiff, then 26, met Defendant for the first time at Defendant’s house. Plaintiff s sister had been acquainted with Defendant in the orthodox Jewish community for about a year, having attended a number of his lectures and knowing his reputation as a religious leader. Plaintiff s sister invited Plaintiff and Plaintiff’s family members to dinner at Defendant’s house with Defendant and Defendant’s family.
9. At dinner, Defendant established credibility by claiming that he graduated from Harvard Law School, Harvard Business School, and the London School of Economics, that he was awarded a prestigious Fulbright Scholarship, and that he was a Rabbi. Defendant also claimed that he worked as a managing director at a hedge fund, and that he also worked on the side as an investment advisor and religious advisor of many billionaires, business moguls, top-tier athletes, and other influential people. Defendant learned that Plaintiff was about to receive funds which he could invest. Defendant invited Plaintiff to a meeting at his office in Los Angeles purportedly to offer financial advice to Plaintiff.
10. On October 12, 2012, Plaintiff and Defendant met at Defendant’s office at Defendant’s employer, CREO Select Opportunities Fund. Defendant shared additional details about his storied career, and Defendant attempted to persuade Plaintiff to invest in one of CREO’s funds.
B. Defendant introduces an investment to Plaintiff
11. Between October 21 and October 23, 2012, Plaintiff and Defendant engaged in several phone calls about possible investment opportunities. Defendant proposed that, rather than Plaintiff investing in a CREO fund, Plaintiff instead invest funds in a goldmine in Arizona
(“the Mine”).
12. On October 24, 2012, on or around 3pm, Plaintiff and Defendant met for the second time at Defendant’s office at CREO. At the meeting, Defendant stated that the Mine was the “investment of a lifetime.” Defendant explained that he had already invested substantial amounts of his own money in the Mine, and that he would like to invite Plaintiff to join Defendant in the deal as an investor. Defendant stated that the Mine did not need Plaintiff s investment, but that Defendant was “allowing” Plaintiff the opportunity of investing because of the cordial relationship Defendant maintained with Plaintiff’s sister. Defendant stated that his associate Don Watson managed the investment, and that Defendant was just another investor, not a principal.
13. On November 9, 2012, on or around lpm, Plaintiff met with Defendant and Watson at the Langham Huntington Hotel in Pasadena to further discuss the investment in the Mine (“the Investment”). At the meeting, Defendant communicated to Plaintiff the following claims about the Investment:
1. that Defendant and Watson were cooperating with Dan Priebs – – an associate of Watson – – to raise money for the Mine;
11. that world-renowned mining expert Craig Wiita, of Wiita Mining & Exploration, had been hired to exploit the Mine;
111. that Five Million Dollars ($5,000,000) in investor funds had already been raised to exploit the Mine from five (5) investors, with One Million Dollars ($1,000,000) raised per investor;
IV. that Defendant himself had personally invested One Million Dollars ($1,000,000) of his own money in the Mine as one of the five (5) investors;
V. that the Mine contained gold worth at least Five Hundred Million Dollars ($500,000,000), if not over One Billion Dollars ($1,000,000,000). These numbers were communicated as “proven,” not estimates. The proof was allegedly based on two exploration studies conducted by Wiita;
VI. that it would take approximately two (2) years to completely exploit the Mine;
VII. that mining had already begun at the Mine.
VIII. that Plaintiff would be added as a claimant to the Bureau of Land
Management claim for the Mine.
IX. that the Investment would encompass multiple goldmines. In addition to the Mine in Arizona, the Investment would also include exploitation of a mine in Redding, California, as well as other mines not yet purchased but still “in the pipeline.”
14. Defendant drafted a Memorandum of Understanding (“MOU”) between Plaintiff and Watson that would act as the contract for the Investment. Defendant emailed the MOU to Plaintiff for review. The MOU specified a Two Hundred Fifty Thousand Dollar ($250,000) investment for one quarter percent (0.25%) ownership of NEWCO, a corporation that would be created after the inception of the contract as the vehicle for operating and exploiting the mine. The contract specified three options for dividends, to be chosen amongst by Plaintiff.
15. On or around November 11-12, 2012, in response to questions Plaintiff asked Defendant about the Investment, Defendant revised the MOU and instructed Plaintiff to forward the revised version to Watson.
16. On or about November 13, 2012, Watson offered a Personal Guarantee (“the Guarantee”) in Plaintiff’s favor. Defendant assured Plaintiff that Watson was financially sound.
17. During the period November 12-14, 2012, Defendant made the following additional representations to Plaintiff:
1. Watson had spent “several million dollars to secure the rights” to the mine.
2. Defendant reiterated his earlier assurance about already having raised Five Million Dollars ($5,000,000), stating he is “100% comfortable that there will be no need to raise further capital.”
3. Defendant reiterated his earlier assurance that mining had already begun at the Mine, indicating “Keep in mind that the Mining Team has processed and sold over a million dollars of gold in the two NEWCO properties already.”
4. Defendant reiterated his earlier assurance that Watson was good for the Guarantee, stating that Watson “has access to several million dollars of bank lines from major institutions” along with other supporting evidence.
C. Plaintiff agrees to invest in Defendant’s deal
On November 14, 2012, Plaintiff agreed to invest One Hundred Fifty Thousand Dollars ($150,000) in the Investment/Mine. Defendant emailed Plaintiff an updated MOU and Personal Guarantee at 8:02pm, a further updated MOU at 11:26pm, a further updated Guarantee at 11:38pm, and wire instructions at 8:13pm.
19. On November 15, 2012, Plaintiff signed the MOU and Guarantee and emailed the signed copies to Defendant and Watson at 10:30am along with a notice that Plaintiff had chosen the dividend-producing option of the MOU, guaranteeing a Two Thousand Five Hundred ($2500) dividend payable on the third day of each month for one year, beginning on December 3, 2012.
20. On November 15, 2012, Plaintiff wired One Hundred Fifty Thousand Dollars ($150,000) to Watson’s company, Strong Solutions. On November 16, 2012 at 9:02am, Watson confirmed receipt of the wire.
Defendant misses dividends on the deal. Not even the first dividend is paid.
21. The Investment’s first dividend payment, in the amount of Two Thousand Five Hundred Dollars ($2500), was due on December 3, 2012. This dividend never arrived. No dividends ever arrived.
22. As it turns out, the following facts are true:
I. the Investment in the Mine had not raised Five Million Dollars
($5,000,000) as represented -rather that not more than $135,000 had been raised for the Mine Investment prior to the time that Plaintiff wired his funds;
II. that Defendant had personally invested at most Ten Thousand Dollars
($10,000) in the Investment, not the One Million Dollars ($1,000,000)
Defendant had claimed earlier;
III. that mining had not yet begun at the Mine in question;
IV. that half of the funds “invested” by Plaintiff were diverted by
Defendant to Defendant’s wholly owned company Stealth Capital for
purposes unrelated to the Mine, and that none of the $150,000 “invested” by Plaintiff were used directly or indirectly for the Mine;
V. that Wiita had concluded that it would take 30 years to mine the Mine, not 2 years as represented;
VI. Defendant was a partner in the Investment, not just another investor, by and through a company known as Enobia Services;
VII. Defendant actually did embezzle Plaintiff’s Investment by having said funds secretly transferred to Stealth Capital without Plaintiff’s
knowledge;
VIII. Defendant knew at all material times that “no smart investor”
would invest one penny in the Mine, while simultaneously telling Plaintiff that this was the investment of a lifetime;
23. In addition to the foregoing, Defendant persuaded Plaintiff to donate $25,000 to Jewish Educational Trade School during December 2012 on behalf of Debtor, as Debtor’s funds were “tied up” in investments. In truth and in fact half of said donation was immediately wired
to Debtor’s company Stealth Capital, for the Debtor’s personal use. Debtor never intended to pay back such funds.
26. As set forth above, in order to induce Plaintiff to make the Investment, Defendant offered the following false pretenses and false representations to Plaintiff, inter alia:
I. Representing that Defendant was an investor and not a principal in the Investment, when in reality he was a principal and the primary orchestrator;
II. Representing that Five Million Dollars ($5,000,000) in capital had already been invested in the Investment and Mine, when in reality less than $135,000 had been raised, if that;
III. Representing that the Investment was fully subscribed and that Defendant is “100% comfortable that there will be NO NEED TO RAISE FURTHER OUTSIDE CAPITAL,” when in reality the Investment desperately needed new investors;
IV. Representing that the “final hard close date” for funding was November 15, 2012 and that no further money would be accepted afterwards, when in reality Defendant fabricated the date for Defendant’s own purposes to obtain money to use by November 15, 2012 for his own personal use;
V. Representing that Defendant personally invested One Million Dollars ($1,000,000) of his own money in the Investment and Mine, when in reality he invested, if at all, only Ten Thousand Dollars ($10,000);
VI. Representing that Defendant did not need Plaintiff s money, when in reality Defendant urgently needed Plaintiff s money to pay unrelated personal debts;
VII. Representing that it would take approximately two (2) years to completely exploit the Mine to the investors’ advantage, when in reality Wiita’s estimate was thirty (30) years;
VIII. Representing that mining had already begun at the Mine, and that “the Mining Team has processed and sold over One Million Dollars ($1,000,000) of gold in these the two NEWCO properties already,” when in reality mining had not yet even begun;
IX. Representing that Plaintiff would be added as a claimant to the BLM
claim for the Mine, when in reality Plaintiff was never added;
X. Representing that the Investment would encompass multiple goldmines,
when in reality the Investment encompassed nothing;
XI. Representing that there would be virtually no risk, when in reality there was such substantial risk that the investment was a total loss from the start, without a single dividend;
XII. Representing that Watson had spent “several million dollars to secure the rights” to the Mine, when in reality Wiita put Watson’s name on the BLM claim for little if any compensation;
XIII. Representing that Watson was good for the Guarantee, stating that Watson “has access to several million dollars of bank lines from major institutions” along with other supporting evidence, when in reality Watson had no personal assets from which to reimburse Plaintiff’s lost investment;
XIV. Representing that NEWCO would be established as the vehicle for
operating and exploiting the Mine, when in reality NEWCO was never created;
XV. Representing that a twenty-five hundred dollar ($2500) dividend would be paid to Plaintiff monthly, when in reality not a single dividend was ever paid;
27. As set forth above, Defendant engaged in actual fraud with knowing, intentional, and deceptive acts of concealment from and misrepresentation of material facts to Plaintiff, such that Plaintiff was induced to invest in the Mine.
Goldman v Gordon Stipulated Judgement in word
Here are some highlights:
WHEREAS, Plaintiff has alleged in the Complaint that an obligation owed to Plaintiff m an amount of not less than $844,000 is non-dischargeable under 11 U.S.C. §523.
WHEREAS, considering the risks and costs involved in the litigation, the Plaintiff and Defendant have agreed to resolve their dispute on terms mutually acceptable to each party, subject to approval by the United States Bankruptcy Court.
NOW, THEREFORE, IT IS HEREBY STIPULATED AND AGREED, by
and between the parties as follows:
I. The attached Stipulated Judgment in the amount of $225,000 (the “Stipulated Judgment”) shall be entered immediately and shall bear simple interest at the rate of ten percent per annum. Defendant consents to the entry of said Stipulated Judgment and agrees that the full amount of the obligation represented by said Stipulated Judgment is non-dischargeable in this and any future bankruptcy proceeding.
Plaintiff agrees not to record nor enforce said Stipulated Judgment for a period of eight (8) months from the date it is entered provided that Anthony Gordon executes the declaration attached hereto concurrently herewith.
2. Both Antony Gordon and his spouse, Elizabeth Joy Gordon, shall promptly provide Brent Goldman with complete access to the current and future tax returns and bank account statements of a) Antony Gordon, b) Elizabeth Joy Gordon, and c) any company which Antony Gordon and/or Elizabeth Joy Gordon directly or indirectly own any portion of and/or controls. Antony Gordon and Elizabeth Joy Gordon shall promptly provide any such documents when they are requested by Brent Goldman via email to the following email address: Gordon@brentgoldman.com. “Promptly” shall be defined as within five (5) business days of when said email is sent.
3. Each side shall bear his own fees and expenses incurred in connection with the within adversary proceeding, except to the extent said amounts are already included in the Stipulated Judgment amount.
4. In consideration of the agreement set forth herein, except as to the obligations arising hereunder and t h e o b 1i g at i o n set fo r t h i n t h e Stipulated Judgment, and conditioned upon the approval of this Settlement Agreement by the Bankruptcy Court in the Antony Gordon bankruptcy case (without the filing of an appeal thereafter), Plaintiff shall forever withdraw, release, discharge, waive and forgive Defendant and his assigns, administrators and successors in interest, for and from any and all claims, actions, causes of action, counterclaims and any other obligation of any kind or nature; provided, however, that the foregoing shall not constitute a release of any rights to enforce the Stipulated Judgment, the terms of this Settlement Agreement, nor shall it constitute a release of any right to assert a claim against the Defendant’s bankruptcy estate.
I, Anthony Gordon, do hereby declare:
1. I am over the age of eighteen years and am competent to give this declaration. The facts stated herein are known by me to be true and correct from my own personal knowledge. If called upon as a witness I could and would competently testify to the facts stated herein.
2. During 2012 and 2013 I paid a combined total of $75,000 to various people with the explicit comm itment from Mr. Don Watson that said funds would be replaced almost immediately. The funds paid to them were the property of Brent J. Goldman. Brent J. Goldman had merely entrusted his funds to me, and was unaware of the disposition of said funds until after they were expended.
