Judge: Curtis A. Kin, Case: 24STCV14074, Date: 2024-09-10 Tentative Ruling

Case Number: 24STCV14074    Hearing Date: September 10, 2024    Dept: 86

            Petitioner Jonathan Paley moves for a preliminary injunction against defendants (1) Marina Grasic, individually and as trustee of the Coastal Road Trust; (2) Credit Bridge Lending, LLC; (3) Nancy Laura Stevens, as trustee of the Vardyger Trust; and (4) Jan Korbelin, as trustee of the Coastal Road Trust.

I.       Factual Background

            On February 26, 2010, petitioner Jonathan Paley filed a civil action in New York Supreme Court against defendant Jan Korbelin, Curious Pictures, LLC (“Curious”) (a production company for which Korbelin was Chief Executive Officer), and other defendants. (Mobargha Decl. ¶ 3 & Ex. 1.) Plaintiff sought a buyout of his ownership interest in Curious, his unpaid salary, and a severance payment. (Mobargha Decl. ¶ 3 & Ex. 1 at ¶¶ 1-3, 8.) On December 7, 2017, the New York Supreme Court entered a judgment against Curious solely and in favor of plaintiff in the amount of $1 million.

            On December 8, 2015, plaintiff filed another action against Korbelin, defendant Marina Grasic (Korbelin’s wife), and other defendants. (Mobargha Decl. ¶ 5.) Plaintiff alleged that, to avoid paying on the judgment owed by Curious, Korbelin and Grasic had transferred two projects that had originated at Curious to a company owned by Grasic. (Mobargha Decl. ¶ 6 & Ex. 3 at ¶¶ 1-5.) On December 15, 2023, after plaintiff won on summary judgment, the New York Supreme Court entered judgment against Korbelin, Grasic, and other defendants, and in favor of plaintiff in the amount of $1,449,963.75. (Mobargha Decl. ¶¶ 8, 10 & Exs. 5, 7.)

            Through post-judgment discovery in the second New York action and other investigation (Mobargha Decl. ¶¶ 11-14), plaintiff learned that, on June 28, 2023, Grasic executed a Short Form Deed of Trust and Assignment of Rents (“Deed of Trust”), whereby Grasic pledged real property located at 3453 Rambla Pacifico in Malibu (“Malibu Property”) as collateral for a $3,425,000 promissory note in favor of defendant Credit Bridge Lending, LLC (“Credit Bridge”). (Mobargha Decl. ¶ 19 & Ex. 14.) Grasic is the sole member of Credit Bridge. (Mobargha Decl. ¶¶ 16-18 & Exs. 11-13.)

            On July 6, 2023, Grasic and defendant Nancy Laura Stevens executed an Irrevocable Trust Agreement establishing The Vardyger Trust, with Grasic as Grantor and Stevens as Trustee. (Mobargha Decl. ¶ 22 & Ex. 17.) On the same date, Grasic conveyed the Malibu Property to Stevens, as Trustee for The Vardyger Trust for no consideration. (Mobargha Decl. ¶ 23 & Ex. 18.) Grasic’s two children are beneficiaries of The Vardyger Trust. (Mobargha Decl. ¶ 22 & Ex. 17, Article Two.) Grasic has been friends with Stevens, also known as Natasha Stoynoff, for 25 years. (Mobargha Decl. ¶ 37 & Ex. 32; see also Mobargha Decl. ¶ 22 & Ex. 17 [email address of Stevens is natashastoynoff@hotmail.com].) Grasic and Korbelin continue to reside at the Malibu Property. (Mobargha Decl. ¶ 12 & Exs. 8, 9 [Interrogatory Responses dated 2/2/24 at 2].)

            On February 11, 2024, Credit Bridge assigned the Deed of Trust to Stevens, as Trustee for The Vardyger Trust. (Mobargha Decl. ¶ 20 & Ex. 15.) On March 9, 2024, Stevens assigned the Deed of Trust to defendant Red Oak Partners LLC (“Red Oak”). (Mobargha Decl. ¶ 21 & Ex. 16.)

            On July 6, 2023, Grasic and Korbelin created the Coastal Road Trust, with Grasic and Korbelin as Grantors and Trustees. (Mobargha Decl. ¶ 24 & Ex. 19.) On the same date, Grasic assigned her interest in Credit Bridge to herself and Korbelin, as Trustees of the Coastal Road Trust, for no consideration. (Mobargha Decl. ¶¶ 25, 26 & Exs. 20, 21.) On the same date, Grasic assigned her interest in Dreamchase Inc. (“Dreamchase”) to herself, as Trustee of the Coastal Road Trust for no consideration. (Mobargha Decl. ¶¶ 27-31 & Exs. 22-26.) Grasic is President, Secretary, and Treasurer of Dreamchase. (Mobargha Decl. ¶ 32 & Ex. 27.)

            As of July 31, 2023, Grasic had approximately $300 and $500 in her savings and checking accounts respectively. (Mobargha Decl. ¶¶ 33, 34 & Exs. 28, 29.)  

II.      Procedural History

            On June 5, 2024, plaintiff filed a Complaint. On August 16, 2024, plaintiff filed the operative First Amended Complaint against Grasic; Grasic and Korbelin, as Trustees of the Coastal Road Trust; Credit Bridge; Stevens, as Trustee of The Vardyger Trust; and Red Oak.

          On August 20, 2024, the Court (Hon. James C. Chalfant, presiding) granted in part plaintiff’s ex parte application. Judge Chalfant denied plaintiff’s request for a temporary restraining order but issued an order to show cause why a preliminary injunction should not issue. Judge Chalfant ordered the summons, First Amended Complaint, moving papers, and order granting the ex parte application to be personally served on all named defendants by August 23, 2024.

Proofs of service of summons have been filed for Credit Bridge; Grasic; Grasic and Korbelin, as Trustees of the Coastal Road Trust; and Stevens, as Trustee for The Vardyger Trust. With the exception of Stevens, the proofs of service of summons indicate that all required documents were served on August 22, 2024. Stevens was served all required papers by substitute service on September 3, 2024.

            On September 3, 2024, specially appearing defendants Grasic and Korbelin, as Trustees of the Coastal Road Trust, filed an opposition. On September 5, 2024, plaintiff filed a reply.

III.     Analysis

Plaintiff seeks a preliminary injunction prohibiting defendants from further transferring, dissipating, or encumbering the Malibu Property or the interests in Credit Bridge or Dreamchase (collectively “Corporate Interests”).

A.           Defendant Stevens

As a preliminary matter, the ruling herein does not apply to defendant Nancy Laura Stevens, as Trustee of The Vardyger Trust, because Stevens was not served by August 23, 2024, as Judge Chalfant ordered. (8/20/24 Minute Order; 9/6/24 Proof of Service of Summons.) The Court will schedule an Order to Show Cause re: why a preliminary injunction should not issue with respect to Stevens after discussion with the parties.

B.           Service on Defendants Grasic and Korbelin

Grasic (individually and as Trustee) and Korbelin (as Trustee) oppose the issuance of a preliminary injunction on the ground that they were not personally served with the summons, First Amended Complaint, or moving papers for the order to show cause.[1]

The proofs of service of summons filed on August 26, 2024 indicate that Grasic and Korbelin (as well as Credit Bridge through Grasic) were personally served by registered process server Diego Vasquez on August 22, 2024 at 8:10 a.m.

            Korbelin declares that, on August 22 at 7:40 a.m., a man pushed through a gate to his house into his daughter while his daughter was opening it. (Korbelin Decl. ¶ 3.) The man was holding a box and purportedly said he had a delivery. (Korbelin Decl. ¶ 4.) Korbelin rushed his daughter back into the house, asked the man what he was doing, informed him that he was trespassing, and asked him to leave. (Korbelin Decl. ¶ 5.) The man refused to leave. (Korbelin Decl. ¶ 5.) Korbelin closed the front door and called the police. (Korbelin Decl. ¶ 6.) The man banged on the front door. (Korbelin Decl. ¶ 7.) When the police arrived at 8:30 a.m., Korbelin noticed that papers had been left on the porch to the front door. (Korbelin Decl. ¶ 9.) The man purportedly did not identify himself as a process server or indicate that he was serving legal papers. (Korbelin Decl. ¶ 10.)

            Grasic declares that she did not see, speak with, hear, or otherwise interact with a process server on August 22, 2024, nor was she outside the house or any place where the process server could have seen her. (Grasic Decl. ¶ 3.)

            By contrast, Vasquez declares that, on August 22, 2024 at 8:10 a.m., he saw Korbelin open the front door of the Malibu Property and saw Grasic standing behind Korbelin. (Vasquez Decl. ¶ 9.) He approached the front door and repeatedly announced that he needed to personally serve them. (Vasquez Decl. ¶ 10.) Korbelin demanded that Vasquez exit the property, indicated that the police would be called, and closed the front door. (Vasquez Decl. ¶ 11.) After waiting a moment, Vasquez left the papers on the porch in front of the door. (Vasquez Decl. ¶ 11.) Deputies from the Los Angeles County Sheriff’s Department later arrived. (Vasquez Decl. ¶ 12.) One of the deputy sheriffs told Vasquez that Korbelin accused him of having assaulted his children. (Vasquez Decl. ¶ 12.) Vasquez identified himself as a process server and denied the assault. (Vasquez Decl. ¶ 12.) The deputy later told Vasquez that he was free to leave, having told Korbelin and Grasic that Vasquez was only serving them. (Vasquez Decl. ¶ 12.)

When a process server explains that the defendant is being served with process and the defendant refuses to accept the documents, service is valid when the process server leaves the documents as close as possible to the defendant. (Trujillo v. Trujillo (1945) 71 Cal.App.2d 257, 259-60.) When “facts occur that would convince a reasonable man that personal service of a legal document is being attempted, service cannot be avoided by denying service and moving away without consenting to take the document in hand.” (In re Ball (1934) 2 Cal.App.2d 578, 579.)

Korbelin does not deny that he closed the front door on Vasquez or that Vasquez left documents on the front porch of his residence. (Korbelin Decl. ¶¶ 6, 9.) However, Korbelin avers that Vasquez never identified himself as a process server or said that he was serving legal papers. (Korbelin Decl. ¶ 10.) The Court does not find this averment to be credible. Korbelin avers that he asked Vasquez what he was doing. (Korbelin Decl. ¶ 5.) It strains credulity to find that Vasquez would not announce that he was serving legal documents, especially when announcing the attempt to serve process would obligate defendants to accept. Vasquez had no reason to hide the motivation for his visit.

Further, while Grasic denies seeing Vasquez on August 22, 2024 (Grasic Decl. ¶ 3), Vasquez avers that he had photographs of both Grasic and Korbelin, that he recognized from the photos that Grasic was standing behind Korbelin, and that Vasquez announced to both of them that they were being served with legal documents. (Vasquez Decl. ¶¶ 6, 9, 10.) Grasic did not aver where she was on August 22, 2024 when Vasquez claimed that he served her. Grasic’s conclusory statement of where she was not, coupled with her failure to state where she actually was on August 22, 2024, causes this Court to doubt the credibility of her declaration.

Considering all the declarations, the Court credits Vasquez’s account of what occurred. When Korbelin and Grasic refused to accept service, Vasquez was entitled to leave the papers on the front porch. The Court finds that Grasic and Korbelin were personally served the moving papers. The Court thus rules on the merits of plaintiff’s request for a preliminary injunction.

C.           Merits

“[T]he question whether a preliminary injunction should be granted involves two interrelated factors: (1) the likelihood that the plaintiff will prevail on the merits, and (2) the relative balance of harms that is likely to result from the granting or denial of interim injunctive relief.”  (White v. Davis (2003) 30 Cal.4th 528, 554.) 

            With respect to likelihood of prevailing on the merits, the Uniform Voidable Transactions Act (“UVTA”) is codified in Civil Code §3439, et seq. With respect to the first cause of action asserted in the First Amended Complaint, Civil Code § 3439.04(a) provides:

A transfer made or obligation incurred by a debtor is voidable as to a creditor, whether the creditor's claim arose before or after the transfer was made or the obligation was incurred, if the debtor made the transfer or incurred the obligation as follows:

(1) With actual intent to hinder, delay, or defraud any creditor of the debtor.

“A fraudulent conveyance under the [UVTA] involves a transfer by the debtor of property to a third person undertaken with the intent to prevent a creditor from reaching that interest to satisfy its claim.” (Filip v. Bucurenciu (2005) 129 Cal.App.4th 825, 829, quotations omitted.) The UVTA’s purpose is “to prevent debtors from placing property which legitimately should be available for the satisfaction of demands of creditors beyond their reach.” (Chichester v. Mason (1941) 43 Cal.App.2d 577, 584.)

Actual intent may be indicated by “[w]hether the transfer or obligation was to an insider,” “[w]hether the debtor retained possession or control of the property transferred after the transfer,” and “[w]hether the value of the consideration received by the debtor was reasonably equivalent to the value of the asset transferred or the amount of the obligation incurred.” (Civ. Code § 3439.04(b)(1), (2), (8).)

Grasic and Korbelin do not dispute that Korbelin’s company, Curious, is subject to a judgment of $1,000,000 entered on December 7, 2017. (Mobargha Decl. ¶ 4 & Ex. 2.) Grasic and Korbelin also do not dispute that they are subject to a judgment entered on December 15, 2023 in the amount of $1,449,963.75 in an action which arose after assets of Curious were transferred to a company owned by Grasic. (Mobargha Decl. ¶ 10 & Ex. 7.)

It is also undisputed that, on June 28, 2023, Grasic encumbered the Malibu Property in favor of Credit Bridge, of which she was the sole member. (Mobargha Decl. ¶¶ 16-19 & Exs. 11-14.) Credit Bridge later assigned the Deed of Trust to Stevens, as Trustee of The Vardyger Trust, who then assigned it to Red Oak. (Mobargha Decl. ¶¶ 20, 21 & Exs. 15, 16.)

It is also undisputed that, on July 6, 2023, Grasic conveyed the Malibu Property to her long-time friend Stevens, as Trustee of The Vardyger Trust, for no consideration. (Mobargha Decl. ¶¶ 23, 37 & Exs. 17, 32.) Grasic and Korbelin continue to reside at the Malibu Property. (Mobargha Decl. ¶ 12 & Exs. 8, 9 [Interrogatory Responses dated 2/2/24 at 2].)

The foregoing sufficiently demonstrates for purposes of issuing a preliminary injunction that Grasic, Korbelin, and Credit Bridge engaged in a scheme to transfer the Malibu Property with actual intent to hinder plaintiff’s collection on his two judgments. After plaintiff obtained his first judgment, Grasic appeared to have helped Korbelin transfer projects of Curious. (Mobargha Decl. ¶ 6 & Ex. 3 at ¶¶ 1-6.) In 2015, plaintiff sued Grasic and Korbelin for fraudulent transfer, ultimately resulting in a second judgment in plaintiff’s favor. (Mobargha Decl. ¶¶ 5, 10 & Ex. 7.) In June and July 2023, before entry of judgment in the second New York action, Grasic encumbered the Malibu Property in favor of her company, Credit Bridge, and conveyed the Malibu Property to her long-time friend Stevens for no consideration. Grasic used straw men—defendants Credit Bridge, Stevens, and Korbelin—to encumber the Malibu Property, transfer the Malibu Property for no consideration, while still residing at the Malibu Property. Grasic’s objective appears to have been to render herself judgment proof such that plaintiff could not collect once judgment against her was entered in the second New York action.

With respect to the Corporate Interests, on July 6, 2023, Grasic assigned her interest in Credit Bridge to herself and Korbelin, as Trustees of Coastal Road Trust for no consideration. (Mobargha Decl. ¶¶ 25, 26 & Exs. 20, 21.) On the same date, Grasic assigned her interest in Dreamchase to herself, as Trustee of the Coastal Road Trust for no consideration. (Mobargha Decl. ¶¶ 27-31 & Exs. 22-26.)

As defendants contend, the Coastal Road Trust appears to be revocable, which means that, as settlors of the Coastal Road Trust, Grasic and Korbelin could revoke the trust. (See Mobargha Decl. ¶ 24 & Ex. 19.) “If the settlor retains the power to revoke the trust in whole or in part, the trust property is subject to the claims of creditors of the settlor to the extent of the power of revocation during the lifetime of the settlor.” (Prob. Code § 18200.) Because the property of the trust remains subject to creditor claims, including plaintiff’s claims, a transfer to a revocable trust does not qualify as a fraudulent transfer. (Gagan v. Gouyd (1999) 73 Cal.App.4th 835, 842 [86 Cal.Rptr.2d 733, 737] disapproved of on other grounds by Mejia v. Reed (2003) 31 Cal.4th 657.) Nevertheless, based on Grasic’s attempts for Korbelin’s company to avoid collection on the first judgment, it is hard to seriously doubt that the transfer of the corporate interests was likely made for the purpose of evading, hindering, or delaying creditors such as plaintiff.  It is also not altogether clear that the Coastal Road Trust is so easily revoked as defendants claim. Plaintiffs have made a sufficient showing as to the Corporate Interests for purposes of obtaining a preliminary injunction.

Defendants do not show cause why the requested preliminary injunction should not issue. Defendants demonstrated a willingness to engage in fraudulent transfers to avoid creditors when Grasic transferred ownership of the Malibu Property. Plaintiff have sufficiently identified the Malibu Property and the interests in Credit Bridge and Dreamchase as property for which transfer, dissipation, or encumbrance should be enjoined. Plaintiff has demonstrated a likelihood of prevailing on the first cause of action.[2]

With respect to the balance of harms, in light of defendants’ repeated efforts to encumber and transfer the Malibu Property, a preliminary injunction is proper to preserve the status quo. (Wind v. Herbert (1960) 186 Cal.App.2d 276, 286 [preliminary injunction found proper when partnership assets dissipated and disbursements could not be adequately traced].) Defendants have shown no harm that would result from an injunction against transfer. As the Malibu Property and Corporate Interests were transferred for no consideration, yet remain in the control of Grasic and Korbelin, defendants would not be harmed were further transfer to be enjoined.

Lastly, the Court does not find that the New York court’s order “suspend[ing] further enforcement activity of the appealed from money judgment” (Powers Decl. ¶ 3 & Ex. A) prevents plaintiff from obtaining a preliminary injunction here.  The term “further enforcement activity” is unclear and does not, on its face, necessarily encompass a UVTA action brought in California, let alone a preliminary injunction sought to maintain the status quo while the merits of that UVTA action is pending.  Indeed, given plaintiff’s letter brief to the New York Clerk of Court “reserv[ing] the right to file a California action to reverse the [defendant]’s latest fraudulent transfer” and the New York court’s issuance of its order thereafter (Kaplan Supp. Decl. ¶ 5 & Ex. 4 at 3), it would appear the ambiguous term “further enforcement activity” is not meant to encompass plaintiff’s participation in this action.

The motion is GRANTED. Defendants Marina Grasic, an individual; Marina Grasic, as Trustee of the Coastal Road Trust; Jan Korbelin, as Trustee of the Coastal Road Trust; and Credit Bridge Lending, LLC are enjoined from further transferring, dissipating, or encumbering (1) the real property located at 3453 Rambla Pacifico, Malibu, California 90265, (2) any membership interest in Credit Bridge Lending, LLC, or (3) any shares or stock in Dreamchase Inc. and/or any of the membership interest in Dreamchase Inc.