Superior Court of California 

County of Los Angeles – West District  

Beverly Hills Courthouse / Department 205 

 

 

BACKGROUND 

 

This is a breach of contract case.  Plaintiff Clover Private Credit Opportunities Origination (Levered) II LP (“Clover”) entered into a put option contract with Defendant Ibrahim AlHusseini (“Ibrahim”), The Husseini Group Inc. and The Husseini Group LLC (collectively “the Husseini Entities”).  (Compl. ¶6.)  Under the put contract, Ibrahim and the Husseini Entities were obligated to pay Clover $75 million in exchange for 10,302,837 shares (the “Shares”) of Aspiration Partners, Inc. (the “Put Option”).  (Id.)  The put contract was signed contemporaneously with a loan agreement (“Loan”) pursuant to which the Shares were pledged as security.  (Id.)   

There was a default on the Loan on October 31, 2022 (id. ¶7), and unbeknownst to Clover, Ibrahim allegedly took steps to move his assets out of the country.  (Id. ¶8.)  In March 2023, he loaned a Saudi Arabian corporation $300 million (the “Saudi Loan”).  In addition, Ibrahim sold Los Angeles real estate worth $5.1 million in December 2022.  (Id.) 

On June 27, 2023, Clover sent Ibrahim a “Notice of Exercise” formally notifying him that “an acceleration has occurred under the Loan Agreement,” and that Clover was, therefore, “exercis[ing] its [Put] Option” with a settlement date of July 12, 2023 (the “Settlement Date”).  Ibrahim, however, failed to make the $75 million payment due under the Put Option on the Settlement Date, despite Clover’s tender of the Shares.  (Id. ¶9.) 

Following Ibrahim’s failure to honor his obligations under the Put Option, Clover filed a motion for summary judgment in lieu of complaint in New York State Court on July 14, 2023 (the “New York Action”).  (Id. ¶10.)  The New York court ruled in Clover’s favor (the “New York Decision”).  The New York Decision, along with a subsequent New York court order awarding Clover interests and attorneys’ fees, was converted into a judgment that was issued on November 1, 2023 (the “New York Judgment”).  (Id.)  

Shortly before entry of the New York Judgment, Ibrahim purportedly took further steps to render himself judgment proof.  Specifically, in or about October 2023, he transferred ownership of real estate at 810 Amoroso Place, Venice, California 90290 reportedly worth $3.7 million to his brother Faisal AlHusseini (the “Venice Transfer”).  (Id. ¶11.) 

Both the Saudi Loan and the Venice Transfer were allegedly concealed and not disclosed until December 2023 when Ibrahim was obligated to respond to an information subpoena issued by Clover to enforce the New York Judgment.  (Id. ¶12.)  The Saudi Loan and Venice Transfer made Ibrahim insolvent and unable to pay the New York Judgment.  (Id.) 

On December 5, 2023, the California Superior Court issued a judgment based on the New York Judgment in favor of Clover against Ibrahim and the Husseini Entities in the amount of $75,120,000 plus interest in the amount of $3,682.191.72 (the “California Judgment”).  

This action ensued.  The operative complaint alleges two claims for fraudulent transfer related to (1) the Saudi Loan and (2) the Venice Transfer.   

An initial proof of service of the summons and complaint was filed with the Court showing Plaintiff attempted to substitute serve Faisal through Taryn Southern, who Plaintiff claims is Ibrahim’s domestic partner and a resident of the Venice Property.  This Court granted Faisal’s motion to quash service, finding that service by substitution on Ms. Southern did not comply with the requirements of §415.20(b).  The Court also denied Plaintiff’s request for service by publication because the Court concluded Plaintiff had not exhausted all attempts to serve Faisal in Saudi Arabia.   

A new proof of service of the summons and complaint was filed with the Court which states Faisal was served by substitute service on September 30, 2024 at 2773 Oubaidah Al Selmani, 8644 AR Rawdah District Jeddah 23435, Saudi Arabia (“2773 address”) by leaving a copy of the summons and complaint with “Abdul Kareem” who is described as a “co-tenant.”   

This hearing is on Faisal’s second motion to quash service of summons.  Faisal argues that contrary to the proof of service, he was not properly served.  Faisal claims he does not live at the 2773 address, and Abdul Kareem is not a member of his household.  Accordingly, substitute service on him at the 2773 address is improper under Code Civ. Proc. § 415.20(b).  

EVIDENTIARY OBJECTIONS 

The Court sustains the objections to the Declaration of Michael SanFilippo except as to ¶4 p. 2:18-19 and ¶5, p. 2:20-22 and sustains the objections to Declaration of Bilal Abdid. 

DISCUSSION 

“Service of process, under longstanding tradition in our system of justice, is fundamental to any procedural imposition on a named defendant.”¿ (AO Alfa-Bank v. Yakovlev (2018) 21¿Cal.App.5th 189, 202.)¿ “To establish personal jurisdiction, compliance with statutory procedures for service of process is essential.”¿ (Kremerman v. White (2021). 71 Cal.App.5th 358, 371.)¿  

But the statutory requirements are to be liberally construed to uphold jurisdiction, rather than defeat it.  (Pasadena Medi-Center Assocs. v. Sup.Ct. (Houts)¿(1973) 9 Cal.3d 773, 778 (“The provisions of this chapter should be liberally construed to effectuate service and uphold the jurisdiction of the court if actual notice has been received by the defendant,¿and in the last analysis the question of service should be resolved by considering each situation from a practical standpoint.”)  

Defendant’s knowledge of the action does not dispense with statutory requirements for service of summons.¿ (Kappel v. Bartlett (1988) 200 Cal.App.3d 1457, 1466.)  However, as long as the defendant receives actual notice of the lawsuit,¿substantial compliance¿with the Code provisions governing service of summons will generally be held sufficient.  (Summers v. McClanahan¿(2006) 140 Cal.App.4th 403, 410-411 (“It is well settled that strict compliance with statutes governing service of process is not required.  Rather, in deciding whether service was valid, the statutory provisions regarding service of¿process should be liberally construed to effectuate service and uphold the jurisdiction of the court if actual notice has been received by the defendant.”).) 

“A defendant, on or before the last day of his or her time to plead or within any further time that the court may for good cause allow” may move “to quash service of summons on the ground of lack of jurisdiction of the court over him or her” that results from lack of proper service.¿ (Code of Civ. Proc. §418.10(a)(1).¿ A defendant has 30 days after the service of the summons to file a responsive pleading.¿ (Code Civ. Proc., §412.20(a)(3).)¿¿ 

“When a defendant challenges the court’s personal jurisdiction on the ground of improper service of process, ‘the burden is on the plaintiff to prove the existence of jurisdiction by proving, inter alia, the facts requisite to an effective service.’” (Summers, 140 Cal.App.4th at 413.)¿      

DISCUSSION 

Faisal argues that Plaintiff has not properly complied with the requirements for substitute service.  The Court disagrees. 

There are two requirements for proper substituted service.  First, a plaintiff must exercise “reasonable diligence” to personally serve the defendant.  (Code Civ. Proc. § 415.20(b).)  Ordinarily, two or three attempts at personal service at a proper place should fully satisfy the requirement of reasonable diligence.  (Bein v. Brechtel-Jochim Group, Inc. (1992) 6 Cal.App.4th 1387, 1391–1392.)¿ Second, if such efforts fail to achieve personal service, the plaintiff may leave a copy of the summons and complaint at the defendant’s “dwelling house, usual place of abode, usual place of business or usual mailing address” with a competent member of the household or person in charge of the office.  (Code Civ. Proc. § 415.20(b).) 

Here, in an effort to locate Faisal in Saudi Arabia, Plaintiff examined post-judgment discovery it had obtained from certain banking institutions, and identified a residential address associated with Faisal—the 2773 address. Thereafter, the investigative agency Kroll Inc., through its Middle East office located in the United Arab Emirates, confirmed that the address identified in banking records was a valid residential address for Faisal.  (SanFilippo Decl. ¶¶ 3-4.)  As Plaintiff notes, however, this evidence is inadmissible hearsay and violates the best evidence rule (as the actual banking records are not attached to counsel’s declaration), and the Court cannot consider it on a motion to quash.   

Notwithstanding, Kroll concluded that the 2773 address was Faisal’s residential address.  (SanFilippo Decl. ¶4, p. 2:18-19.)  And the process server identified the 2773 address as Plaintiff’s residential address, as confirmed by a co-tenant of Faisal, Mr. Kareem.  (Abid Decl. ¶ 3.)  The Court credits Kroll’s conclusions and the process server’s declaration.     

The process server’s attempts to serve Faisal included five separate efforts at different times of the day over numerous days, and an additional attempt at Faisal’s place of business, as identified by Kroll.  The business address was also confirmed by a security guard at the place of business.  These efforts easily satisfy the “reasonable diligence” standard, as outlined in Bein, where two or three attempts are generally considered sufficient. (6 Cal. App. 4th at 1392.)  

After these multiple attempts, on September 30, 2024, Plaintiff effectuated service by substitution on Mr. Kareem, who the process server identified as a co-tenant of Faisal.  Plaintiff met the statutory requirement for substituted service under § 415.20(b) by leaving the summons and complaint in Mr. Kareem’s presence.  Further, the process server engaged by Plaintiff mailed a copy of the summons and complaint to Faisal at his residential address on October 1, 2024, by first-class mail, in compliance with § 415.20(b).  

Faisal claims Mr. Kareem is not a member of his household.  And the papers were not handed to Mr. Kareem while he was inside the home, but rather was left with him while he was sitting in a car outside the 2773 Property.  (Ibrahim Decl. ¶ 4.)  The process server contradicts Mr. Kareem’s claims and attests that Mr. Kareem identified himself as a co-tenant of Faisal and answered the door at the residence.  (Abid Decl. ¶ 3.)  The Court credits the process server’s declaration.   

In sum, Plaintiff has fully complied with all statutory requirements, and Faisal has been validly served pursuant to California law.  (See First American Title Ins. Co. v. Banerjee (2022) 87 Cal. App. 5th 37, 43 (concluding substitute service was proper based on the facts that the person who accepted service identified himself to process server as a “co-resident” of defendant, that defendant’s name was listed on the community directory, and that server then mailed copy of documents to the address which also was defendant’s mailing address on California Secretary of State’s website).  

CONCLUSION 

For the foregoing reasons, the Court DENIES Defendant Faisal AlHusseini’s motion to quash service of summons.     

 

DATED:  December 5, 2024 ___________________________ 

Edward B. Moreton, Jr. 

Judge of the Superior Court