united states district court - robb evans · robb evans & associates, receiver, federal trade...

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

3607640.2 | 078410-0061 1 Case No. 5:18-cv-02104FOURTH AFFIDAVIT OF NON-COMPLIANCE

Michael Gerard Fletcher (State Bar No. 070849) [email protected] Craig A. Welin (State Bar No. 138418) [email protected] Hal Goldflam (State Bar No. 179689) [email protected]) FRANDZEL ROBINS BLOOM & CSATO, L.C. 1000 Wilshire Boulevard, Nineteenth Floor Los Angeles, California 90017-2427 Telephone: (323) 852-1000 Facsimile: (323) 651-2577 Attorneys for Receiver ROBB EVANS AND ASSOCIATES LLC

UNITED STATES DISTRICT COURT

CENTRAL DISTRICT OF CALIFORNIA

WESTERN DIVISION

FEDERAL TRADE COMMISSION,

Plaintiff,

v. JASON CARDIFF, et al.,

Defendants.

Case No. 5:18-cv-02104-SJO-PLA RECEIVER’S FOURTH AFFIDAVIT ON THE NON-COMPLIANCE WITH THE TEMPORARY RESTRAINING ORDER AND CONTINUING NON-COMPLIANCE WITH PRELIMINARY INJUNCTION Hon. S. James Otero

Case 5:18-cv-02104-SJO-PLA Document 273 Filed 01/29/20 of 22 Page ID #:12964

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28


FRAN

DZE

L RO

BIN

S BL

OO

M &

CSA

TO, L

.C.

1000

WIL

SHIR

E BO

ULE

VARD

, NIN

ETEE

NTH

FLO

OR

LOS

ANG

ELES

, CAL

IFO

RNIA

900

17-2

427

(323

) 852

-100

0

TO: THE HONORABLE S. JAMES OTERO, JUDGE OF THE

UNITED STATES DISTRICT COURT:

Robb Evans & Associates LLC has been appointed by this Court as the

receiver (“Receiver”) over Jason Cardiff, Eunjung Cardiff, and others in this action.

Cardiff Attempt to Dissipate Receivership Estate Assets.

The Receiver has recently discovered that Jason Cardiff (“Cardiff”) has

attempted to dissipate receivership estate assets by trying to borrow against the cash

surrender value of his personal insurance policy with AXA Equitable Life Insurance

Company (“AXA”). The Receiver had previously (in October 2018) put AXA on

notice of this Court’s orders concerning Cardiff. See Declaration of Anita Jen (“Jen

Declaration”), ¶ 2; Exh. 1.

On January 3, 2020, Tammy Blume (“Blume”), a manager/legal assistant at

AXA, contacted the Receiver about Cardiff’s request to borrow against Cardiff’s

AXA insurance policy, which would – had it succeeded – have dissipated the cash

surrender value of that policy. See Jen Decl. ¶ 2; Exh. 1.

The Receiver told AXA that borrowing by Cardiff against the policy was

prohibited by this Court’s orders. Jen Decl. ¶ 3; Exh. 2. So far as the Receiver has

been able to determine, the requested Cardiff loan was not made, and the cash

surrender value of the AXA policy was not impaired by this most recent attempt by

Cardiff to avoid this Court’s orders. See Jen Decl. ¶ 4; Exh. 3 (reflecting email from

Blume stating that she will advise the AXA life business department that Cardiff’s

loan request should be denied). Cardiff had, pre-receivership, borrowed against the

AXA policy, which policy loans remain outstanding. This recent attempt was to

obtain funds post-receivership, which is prohibited by this Court’s orders. See

Preliminary Injunction ¶¶ A & M (defining “Receivership Property” as, among

other things, any “Asset” – i.e., any “legal or equitable interest in . . . any property”

– held for the benefit of, among others, Jason Cardiff); Preliminary Injunction

¶ VII.A. (reflecting asset freeze).


1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28


FRAN

DZE

L RO

BIN

S BL

OO

M &

CSA

TO, L

.C.

1000

WIL

SHIR

E BO

ULE

VARD

, NIN

ETEE

NTH

FLO

OR

LOS

ANG

ELES

, CAL

IFO

RNIA

900

17-2

427

(323

) 852

-100

0

Court Order to Give Notice of Non-Compliance.

The Receiver has been ordered by the Court at various times to perform

various tasks, including as set forth with particularity in that certain Ex Parte

Temporary Restraining Order With Asset Freeze, Appointment Of A Temporary

Receiver, And Other Equitable Relief, And Order To Show Cause Why A

Preliminary Injunction Should Not Issue, issued by this Court on October 10, 2018

(“Receivership Order”). The Receivership Order directs that, if the Receiver

discovers that anyone is failing to comply with the Receivership Order, the Receiver

may, among other things, file with the Court the Receiver’s Affidavit of Non-

Compliance. See Receivership Order, Section XVII, “Transfer of Receivership

Property to the Receiver,” page 27, lines 9-12.

The issued Preliminary Injunction With Asset Freeze, Receiver, and Other

Equitable Relief Against Jason Cardiff and Eunjung Cardiff, issued, November 8,

2018 (Dkt. 59) (“Preliminary Injunction”) continues in effect these requirements and

powers. See Preliminary Injunction, Section XVII, “Transfer of Receivership

Property to the Receiver,” page 30, lines 15-18. Additionally, under Section XV of

the Preliminary Injunction, the Receiver is ordered to control all assets held by any

entity that is directly or indirectly owned or controlled by Jason and/or Eunjung

Cardiff. See Preliminary Injunction, Section XV, “Continuation of the

Receivership,” page 22, lines 8-21.

Prior Notices of Non-Compliance.

The Receiver previously filed and served three other notices of non-

compliance, filed on October 23, 2018 (Dkt. 206), July 2, 2019 (Dkt. 144), and

August 22, 2019 (Dkts. 200; 201), respectively.

New Notice of Non-Compliance.

This report constitutes the Receiver’s Fourth Affidavit of Non-Compliance

with the TRO and Preliminary Injunction, supported by the accompanying

declaration of Anita Jen, along with exhibits, and all of the files and records of this


1 action. This filing reflects and evidences the further substantial and material

2 violations of this Court' s TRO and the continuing violations of the Preliminary

3 Injunction by Cardiff.

4

5 DATED: Januaryc2(, 2020 ROBB EV ANS & ASSOCIATES LLC

6 Acting in its capacity as the duly appointed receiver

7

8

9 By~~~ u 10 BRICK KANE ....:l «: President

0 ~ 0 11 0 ....l ['.

f-< ~ N < :i:: '¢ (/) £--< N 12 u ~ [....

~ .... ~ ... 0

~ 0

13 ::s ~ O'> g 0 z :s 0 - z .... 0 Q «: '

14 ...:I «: 0 N < "' Lil i:Q f;J:; oo

Cl) -'< ~

Z g u_ ~ 15 ~CQ UlM t:Q ~ ~

0 ~ <;] 16 p::: :i:: " ti) z

...:I ;::; <(

w 3: ~ 17 No .....i ~ 0 z 0 ~ .... 18 ii.

19

20

21

22

23

24

25

26

27

28

3607640.2 I 0784 I 0-0061 4 Case No. 5: I 8-cv-02 104

FOURTH AFFIDAVIT OF NON-COMPLIANCE


1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28


FRAN

DZE

L RO

BIN

S BL

OO

M &

CSA

TO, L

.C.

1000

WIL

SHIR

E BO

ULE

VARD

, NIN

ETEE

NTH

FLO

OR

LOS

ANG

ELES

, CAL

IFO

RNIA

900

17-2

427

(323

) 852

-100

0

DECLARATION OF ANITA JEN

I, Anita Jen, declare:

1. I am the Chief Financial Officer of Robb Evans & Associates LLC, the

receiver (“Receiver”) duly appointed by the United States District Court in this

matter. I am a Certified Public Accountant and have been employed by Robb Evans

& Associates LLC for over 23 years. I have personal knowledge of the matters set

forth in this declaration, and could and would testify competently if called upon to

do so in this matter.

2. On January 3, 2020, at 9:15 a.m. (PST) (12:15 p.m. (EST)), I received

an encrypted email from Tammy Blume (“Blume”), a manager/legal assistant at

AXA Equitable Life Insurance Company (“AXA”). That email contained a

hyperlink, which I clicked, and I proceeded to download the secure message in PDF

form. The secure message was an email from Blume to, among others, me, stating

that AXA had received a loan request against an AXA life insurance policy account

number ending in 6040 (“Account”) held for the benefit of Jason Cardiff. The secure

message further stated that the Account had previously been frozen since October

2018, when the Receiver notified AXA of the Court’s Temporary Restraining Order

and Asset Freeze. A true and correct copy of the email and secure message are

attached hereto collectively as Exhibit 1 and incorporated herein by this reference.

3. On January 3, 2020, at 9:37 a.m. (PST) (12:37 p.m. (EST)), I

responded to Blume’s email by forwarding a copy of the Preliminary Injunction,

advising Blume of the current asset freeze as to all assets of the defendants, and

inquiring as to the identity of the person who made the loan request. A true and

correct copy of that email is attached hereto as Exhibit 2 and incorporated herein by

this reference.

4. On January 3, 2020, at 10:47 a.m. (PST) (1:47 p.m. (EST)), Blume

responded to my email, advising that the loan request was made by Jason Cardiff as

trustee of the trust which owns the Account. Blume attached to her email copies of,


united states district court - robb evans · robb evans & associates, receiver, federal trade...

Documents