Shaper v. Zadek
- Edward Chen
- 3:21-cv-00493
- U.S. District Court · Northern District of California
- 5
In Shaper v. Zadek, Judge Hixson denied Plaintiffs’ request to attach Defendants’ property because they did not show serious harm requiring action without notice.
The ruling affected Judith S. Shaper and the Judith S. Shaper Living Trust by denying their request to attach property belonging to Robert A. Zadek, L.O. Annie, Inc., and Lenders Funding, LLC before notice and a hearing.
What happened
In Shaper v. Zadek, Judith S. Shaper and the Judith S. Shaper Living Trust alleged that Robert A. Zadek and related entities defrauded them through the sale of about $4 million in promissory notes. They asked the court to attach Defendants’ property before Defendants received notice.
Plaintiffs argued that their money might disappear if Defendants were notified. The court found that this concern was speculation, not evidence showing that the property would become unavailable.
Judge Hixson denied Plaintiffs’ application because they did not show that waiting for a hearing after notice would cause serious or irreparable harm. The order did not decide whether Plaintiffs would ultimately prevail on their claims.
The detailed version
- Shaper v. Zadek · No. 3:21-cv-00493
- Edward Chen
- Feb. 5, 2021
Background
Judith S. Shaper and the Judith S. Shaper Living Trust sued Robert A. Zadek, L.O. Annie, Inc., and Lenders Funding, LLC. Plaintiffs alleged that Zadek defrauded Judith Shaper and her stepdaughters by selling approximately $4 million in unregistered subordinated promissory notes. The complaint asserted 16 causes of action, including federal and California securities-law violations, financial elder abuse, breach of fiduciary duty, breach of contract, fraud, misrepresentation, conversion, and unjust enrichment.
Plaintiffs alleged that they invested approximately $4 million and later demanded repayment. They stated that the amount then owing under the notes was $1,654,080.60. Plaintiffs filed an application for a prejudgment right-to-attach order and writ of attachment covering Defendants’ attachable property, including deposit and bank accounts.
Legal standard
A right-to-attach order allows a plaintiff to secure property before judgment. Because Plaintiffs sought the order without first giving Defendants notice, California law required them to show, among other things, that the claim was one for which attachment was permitted, that the claim was probably valid, and that they would suffer great or irreparable injury if the request were delayed until a hearing after notice.
The court explained that federal courts apply the attachment procedures of the state where they sit. It also stated that California’s attachment law is strictly construed and that requests for action without notice are disfavored.
Ruling
The court denied Plaintiffs’ application. Plaintiffs relied on Judith Shaper’s statement that she was concerned that her funds had been stolen or lost and argued that Defendants might make the money disappear if they received notice. The court found that this assertion lacked an evidentiary foundation and that Plaintiffs’ prediction was speculative.
The court held that Plaintiffs had not shown that serious or irreparable harm would result if the attachment request were delayed until Defendants could receive notice and be heard. The order therefore denied the application; it did not resolve the underlying allegations or determine whether Plaintiffs were entitled to damages, rescission, or other relief.
Read the full 5-page opinion on CourtListener, the free public archive maintained by the Free Law Project.