Court filing
Qui Tam Complaint -- United States ex rel. Quesenberry v. JMG Investments, Inc
Filed September 10, 2020 in Quesenberry Qui Tam Jmg; one of 7 filings from this case.
Record facts
| Court | U.S. District Court for the Central District of California |
|---|---|
| Filed | 2020-09-10 |
U.S. District Court for the Central District of California · No. 2:20-cv-08497-MWF-AS · Doc. 1 · 2020-09-10 · Docket on CourtListener
Full text
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Bryan Quesenberry
197 East 100 North, Suite A
Payson, UT 84651
801-473-9951
jbq.esq~a,gmail.com
Plaint /Relator
u.s. nisrnic~rc~uar
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BCENTRgI
TRICT OF CALI~URNI?~
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5
iJNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
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UNITED STATES OF AMERICA, ex
Case No.
rel. BRYAN QUESENBERRY,
2: 2
~
cv OS~I°1-1-MW F- ASx
8
COMPLAINT FOR VIOLATION
Plaintiff,
OF FEDERAL FALSE CLAIMS
9
vs.
ACT
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2 EVIL GETTIUSES; A-1 GLASS,
(Filed in camera and under seal)
LLC; ADAMSON AHDOOT, LLP;
(DO NOT PLACE ON PACER)
1 1
ALEXANDER POU; ALLSTAR
HEALTH PROVIDERS, INC;
JURY TRIAL DEMANDED
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AMIGOS PAWNSHIP, INC; ARIES
YAN INVESTMENTS; ARSA
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MEDICAL WHOLESALE, INC; B E
PRODUCTS,INC; BEST TIME
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EXPRESS, INC; BMW NATION
WIDE SECURITY, INC;
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CALIFORNIA AUGER BORING,
INC; CENTERPOINT MINISTRIES;
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CHERNOVTEAM;
CHRISTOFFERSON
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TRANSPORTATION, INC; CITY
LOGISTICS AND TRANSPORT,
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INC; COMPArIION HOSPICE, LLC;
CREATIVE COMPOUNDS,
INC;
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DEAN SALO DDS, INC; DOUBLE A
DISTRIBUTION, INC; ECLIPSE
20
RECREATIONAL VEHICLES, INC;
EL COMPADRE. INC; EYES
Fee Paid
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 1 of 27 Page ID #:1
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CREATIVE, LLC; FALCON
MOTORS, INC; FETCH
2 INDUSTRIES, INC. FINELINE
WOODWORKING,INC;
3 FURNITOPIA, LLC; GOGI HOUSE;
GOODNEWS ENTERPRISES, INC;
4 GORJANA &GRIFFIN, INC; GREEN
VIEW N[JRSERY, INC; HORIZON 5
5 LAKES, LLC; INNOVA CLAIMS
MANAGEMENT, LLC; JAMES
6 MCMINN, INC; JK ENGINEERING
AEROSPACE &DEFENSE; JLL
7 SOLUTIONS, INC; JMG
INVESTMENTS, INC; JOHN'
S
8 INCREDIBLE PIZZA COMPANY,
INC; JOURNEYMEN
9 CONSTRUCTION; K9 BALLISTICS,
INC; LABEL DADDY PARTNERS,
l0
LLC; LAND GORILLA, LLC;
LARGE INVESTMENT GROUP,
1 1
INC; M LIBRUSH CONSTRUCTION,
INC; MAGNUSON PRODUCTS,
12
LLC; MH HOMES, LLC; MICRO
GROW GREENHOUSE SYSTEMS;
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MICRODI'NE PLASTICS, INC; N
BHULLAR, INC; NEIGHBORHOOD
14 PHARMACY,
INC; NEW WORLD
EMPIRE TRADING, INC; OC
15
VETERINARY MEDICAL CENTER,
INC; OLA, INC; OLD MISSION
16 GRAMMAR SCHOOL PARENTS
CLUB aka OLD MISSION SCHOOL;
17
ORRTEK, INC; OTTIMO
RESOURCES, INC; PACIFIC
18
ANTENNA SYSTEMS; PANDA
MOTORS, INC; PIG N WHISTLE,
19 LLC; POSH MANAGEMENT;
POWERI INTEGRATED, INC;
20 PROMAX INTERNATIONAL /
BPME; RADEGY. INC: RESERVE
~~
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 2 of 27 Page ID #:2
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DIVERSIFIED, INC; RNC CAPITAL
MANAGEMENT, LLC; SHAZOH,
2 INC; SIOUX TRUCKING, INC; SO
CAL PF, LLC; SOCIALWISE, INC;
3 SOUTI~RN CALIFORNIA
MEDICAL GROUP;
4 SOUTHWESTERN INDUSTRIES,
INC; SPYDERBUILT; ST.
5 ALOYSIUS GONZAGA SCHOOL;
STAR ELECTRIC, INC; SUNSET
6 SLEEP LABS, LLC; SUPERIOR
ENTERPRISES, LLC; SWINDEMAN
7 TRADING, LLC; THE LITTLE
MARKET, INC; TOMNATCO,
INC;
8 UNITED GLOBAL NEWS;
VAYSFELD STUDIOS, LLC; WEST
9 COAST CHASSIS; WILLIAM B,
LLC; WOODCREST SCHOOLS, INC;
10
and WOODLAND HILLS
FIREPLACE SHOP,
1 1
Defendants.
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Plaintiff-Relator Bryan Quesenberry, acting pro se, on behalf of the United
States of America (the "Government" or the "Federal Government") and against
the above-named Defendants, alleges based upon personal knowledge, relevant
documents, information, and belief, as follows.
INTRODUCTION
1.
This is an action to recover damages and civil penalties on behalf of
the United States of America arising from false and/or fraudulent records,
statements, and claims made and caused to be made by Defendants and/or their
3
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 3 of 27 Page ID #:3
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agents and employees, in violation of the federal False Claims Act, 31 U.S.C. §§
2 3729, et seq. ("the FCA").
3 2.
This action seeks to recover millions of federal dollars wrongfully
4 loaned to Defendants through the Federal Government's Payroll Protection
s Program ("PPP"). The PPP provides a pathway to borrowers for forgiveness of
6 these loans.
~ 3.
Pursuant to the PPP, the Federal Government has spent billions of
s dollars in stimulus funding, as well as other federal funding, to support and aid
9 legitimate businesses through the coronavirus pandemic.
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4.
This action alleges that certain Defendants applied multiple times for
is PPP funds and received PPP funds multiple times despite the PPP application and
12
rules prohibiting applicants from receiving PPP funds more than once.
13
5.
The FCA was enacted during the Civil War, and was substantially
14 amended in 1986, and again in 2009 and 2010. Congress amended the FCA in
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1986 to enhance the Federal Government's ability to recover losses sustained as a
16
result of fraud against the United States after finding that fraud in federal programs
i~
was pervasive and that the FCA, which Congress characterized as a primary tool
ss
for combating government fraud, was in need of modernization. The amendments
19 create incentives for individuals to come forward with information about fraud
zo
against the Federal Government without fear of reprisals or inaction, and enable
4
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 4 of 27 Page ID #:4
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the use of private legal resources to prosecute fraud claims on the Federal
2 Government's behalf.
3 6.
The FCA prohibits, inter alias (1) knowingly presenting, or causing to
4 be presented, a false or fraudulent claim for payment or approval; and (2)
s knowingly making or using, or causing to be made or used, a false or fraudulent
6 record or statement material to a false or fraudulent claim. 31 U.S.C. §§
~ 3729(a)(1)(A), (B). Any person who violates the FCA is liable for a civil penalty
s of up to $11,000 for each such claim, plus three times the amount of the
9 damages sustained by the Government. 31 U.S.C. § 3729(a)(1)(A) (as adjusted by
Zo
the Federal Civil Penalties Inflation Adjustment Act of 1990 [28 U.S.C. § 2461
ii
note; Public Law 104-410]).
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7.
In 2009, Congress amended the FCA to clarify that a "claim" includes
13 "any request or demand, whether under a contract or otherwise, for money or
14 property and whether or not the United States has title to the money or property
Zs
that (i) is presented to an officer, employee, or agent of the United States; or (ii) is
16 made to a contractor, grantee, or other recipient, if the money or property is to be
1~
spent or used on the Government's behalf or to advance a Government program or
Zs
interest..." 31 U.S.C. § 3729(b)(2).
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8.
The FCA allows any person having information about an FCA
20 violation to bring an action for himself and the Federal Government, and to share
s
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 5 of 27 Page ID #:5
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in any recovery. The FCA requires that the complaint be filed under seal for a
z minimum of 60 days (without service on Defendants during that time) to allow the
3 Federal Government time to conduct its own investigation and to determine
a whether to join the suit.
s 9.
Based on the foregoing laws, qui tam Plaintiff/Relator seeks through
6 this action to recover all available damages, civil penalties, and other relief for the
~ violations alleged herein in every jurisdiction to which Defendants' misconduct
s has extended.
9
PARTIES
Zo
10.
Plaintiff/Relator Bryan Quesenberry ("Relator") is a resident of Utah.
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He brings this action on behalf of the United States of America, the real party in
12
interest.
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11.
The following is a chart identifying each Defendant, the amounts of
14 PPP funds they received, their address and location where they conduct business,
Zs
and the dates they applied for PPP funds.
AMOUNT
DEFENDANT
CITY
APP.
DATE
$350,000-1 million
2 EVIL GENIUSES
SANTA ANA
4/29/2020
$350,000-1 million
2 EVIL GENIUSES
SANTA ANA
5/3/2020
$150,000-350,000
A-1 GLASS, LLC
PASO ROBLES
5/5/2020
$150,000-350,000
A-1 GLASS, LLC
PASO ROBLES
4/27/2020
D
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 6 of 27 Page ID #:6
$150,000-350,000
ADAMSON AHDOOT,
LLP
LOS ANGELES
5/1/2020
$150,000-350,000
ADAMSON AHDOOT,
LLP
LOS ANGELES
4/30/2020
$150,000-350,000
ALEXADER POU
THOUSAND
OAKS
6/30/2020
$150,000-350,000
ALEXADER POU
THOUSAND
OAKS
6/30/2020
$150,000-350,000
ALLSTAR HEALTH
PROVIDERS, INC.
RANCHO
CUCAMONGA
5/3/2020
$150,000-350,000
ALLSTAR HEALTH
PROVIDERS, INC.
RANCHO
CUCAMONGA
5/1/2020
$150,000-350,000
AMIGOS PAWNSHOP,
INC.
LOS ANGELES
6/24/2020
$150,000-350,000
AMIGOS PAWNSHOP,
INC.
LOS ANGELES
5/29/2020
$150,000-350,000
AIRES YAN
INVESTMENTS
VAN NUYS
6/29/2020
$150,000-350,000
AIRES YAN
INVESTMENTS
VAN NUYS
6/30/2020
$150,000-350,000
ARSA MEDICAL
WHOLESALE, INC.
LOS ANGELES
5/4/2020
$150,000-350,000
ARSA MEDICAL
WHOLESALE, INC.
NORTH
HOLLYWOOD
5/21/2020
$150,000-350,000
B E PRODUCTS, INC.
PLACENTIA
6/30/2020
$150,000-350,000
B E PRODUCTS, INC.
PLACENTIA
4/28/2020
$350,000-1 million
BEST TIME EXPRESS,
INC.
FONTANA
6/29/2020
$350,000-1 million
BEST TIME EXPRESS,
INC.
FONTANA
6/30/2020
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 7 of 27 Page ID #:7
$350,000-1 million
BMW NATION WIDE
SECURITY, INC.
LONG BEACH
5/29/2020
$150,000-350,000
BMW NATION WIDE
SECURITY, INC.
LONG BEACH
5/27/2020
$150,000-350,000
CALIFORNIA AUGER
BORING, INC.
ANAHEIM
4/28/2020
$150,000-350,000
CALIFORNIA AUGER
BORING, INC.
ANAHEIM
5/6/2020
$150,000-350,000
CENTERPOINT
MINISTRIES
MURRIETA
4/27/2020
$150,000-350,000
CENTERPOINT
MINISTRIES
MURRIETA
5/3/2020
$150,000-350,000
CHERNOVTEAM
LOS ANGELES
5/15/2020
$150,000-350,000
CHERNOVTEAM
STUDIO CITY
6/30/2020
$150,000-350,000
Christofferson
Trans ortation, Inc.
RIVERSIDE
5/1/2020
$150,000-350,000
Christofferson
Trans ortation, Inc.
RIVERSIDE
4/28/2020
$350,000-1 million
CITY LOGISTICS
AND TRANSPORT,
INC.
CARSON
4/28/2020
$350,000-1 million
CITY LOGISTICS
AND TRANSPORT,
INC.
LONG BEACH
4/28/2020
$1-2 million
COMPANION
HOSPICE, LLC
DOWNEY
4/28/2020
$350,000-1 million
COMPANION
HOSPICE, LLC
RIVERSIDE
4/28/2020
$350,000-1 million
CREATIVE
COMPOUNDS, INC
COSTA MESA
4/29/2020
$350,000-1 million
CREATIVE
COMPOUNDS, INC
COSTA MESA
4/29/2020
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 8 of 27 Page ID #:8
$350,000-1 million
DEAN SALO DDS,
INC
LOS ANGELES
4/7/2020
$150,000-350,000
DEAN SALO DDS,
INC
TORRANCE
4/7/2020
$150,000-350,000
DOUBLE A
DISTRIBUTION, INC.
EASTVALE
5/3/2020
$150,000-350,000
DOUBLE A
DISTRIBUTION, INC.
EASTVALE
6/30/2020
$1-2 million
ECLIPSE
RECREATIONAL
VEHICLES, INC.
RIVERSIDE
6/29/2020
$1-2 million
ECLIPSE
RECREATIONAL
VEHICLES, INC.
RIVERSIDE
6/30/2020
$350,000-1 million
EL COMPADRE, INC
LOS ANGELES
5/1/2020
$150,000-350,000
EL COMPADRE, INC
LOS ANGELES
5/2/2020
$150,000-350,000
EYES CREATIVE,
LLC
LOS ANGELES
4/28/2020
$150,000-350,000
EYES CREATIVE,
LLC
LOS ANGELES
6/30/2020
$350,000-1 million
FALCON MOTORS,
INC
PANORAMA CITY
5/3/2020
$150,000-350,000
FALCON MOTORS,
INC
PANORAMA CITY
4/30/2020
$150,000-350,000
FETCH INDUSTRIES,
INC
CANOGA PARK
4/27/2020
$150,000-350,000
FETCH INDUSTRIES,
INC
LOS ANGELES
5/8/2020
$150,000-350,000
FETCH INDUSTRIES,
INC
LOS ANGELES
5/1/2020
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 9 of 27 Page ID #:9
$1-2 million
FINELINE
WOODWORKING,
INC.
COSTA MESA
5/3/2020
$350,000-1 million
FINELINE
WOODWORKING,
INC.
COSTA MESA
4/15/2020
$350,000-1 million
FINELINE
WOODWORKING,
INC.
COSTA MESA
6/30/2020
$150,000-350,000
FURNITOPIA, LLC
MONTEBELLO
6/29/2020
$150,000-350,000
FURNITOPIA, LLC
MONTEBELLO
6/29/2020
$150,000-350,000
GOGI HOUSE
SANTA CLARITA
5/3/2020
$150,000-350,000
GOGI HOUSE
SANTA CLARITA
4/15/2020
$1-2 million
GOODNEWS
ENTERPRISES, INC.
TORRANCE
4/27/2020
$150,000-350,000
GOODNEWS
ENTERPRISES, INC.
TORRANCE
5/3/2020
$1-2 million
GORJANA &
GRIFFIN, INC.
LAGUNA BEACH
5/1/2020
$1-2 million
GORJANA &
GRIFFIN, INC.
LAGUNA BEACH
CA
4/29/2020
$150,000-350,000
GREEN VIEW
NURSERY, INC.
CALABASAS
5/19/2020
$150,000-350,000
GREEN VIEW
NURSERY, INC.
CALABASAS
5/19/2020
$1-2 million
HORIZON 5 LAKES,
LLC
LOS ANGELES
5/27/2020
$1-2 million
HORIZON 5 LAKES,
LLC
CANOGA PARK
6/ 1 /2020
$350,000-1 million
INNOVA CLAIMS
MANAGEMENT, LLC
MISSION VIEJO
5/3/2020
io
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 10 of 27 Page ID
#:10
$350,000-1 million
INNOVA CLAIMS
MANAGEMENT, LLC
MISSION VIEJO
6/30/2020
$1-2 million
JAMES MCMINN,
INC.
RIVERSIDE
5/5/2020
$1-2 million
JAMES MCMINN,
INC.
RIVERSIDE
4/27/2020
$150,000-350,000
JK ENGINEERING
AEROSPACE &
DEFENSE
YORBA LINDA
4/14/2020
$150,000-350,000
JK ENGINEERING
AEROSPACE &
DEFENSE
YORBA LINDA
6/18/2020
$350,000-1 million
JLL SOLUTIONS, INC. SANTA MONICA
4/28/2020
$350,000-1 million
JLL SOLUTIONS, INC. SANTA MONICA
5/1/2020
$350,000-1 million
JMG INVESTMENTS,
INC.
WOODLAND
HILLS
5/8/2020
$350,000-1 million
JMG INVESTMENTS,
INC.
WOODLAND
HILLS
4/30/2020
$1-2 million
JOHN'S INCREDIBLE
PIZZA, INC.
Rancho Santa
Mar arita
4/ 15/2020
$350,000-1 million
JOHN'S INCREDIBLE
PIZZA, INC.
Rancho Santa
Mar arita
4/15/2020
$350,000-1 million
JOHNS INCREDIBLE
PIZZA, INC.
Rancho Santa
Mar arita
4/15/2020
$150,000-350,000
JOHNS INCREDIBLE
PIZZA, INC.
Rancho Santa
Mar arita
4/15/2020
$150,000-350,000
JOHNS INCREDIBLE
PIZZA, INC.
Rancho Santa
Mar arita
4/15/2020
$150,000-350,000
JOHNS INCREDIBLE
PIZZA, INC.
Rancho Santa
Mar arita
4/15/2020
$350,000-1 million
JOURNEYMAN
CONSTRUCTION
LOS ANGELES
5/28/2020
i i
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 11 of 27 Page ID
#:11
$150,000-350,000
JOURNEYMAN
CONSTRUCTION
WOODLAND
HILLS
6/25/2020
$150,000-350,000
K9 BALLISTICS, INC.
CAMARILLO
4/28/2020
$150,000-350,000
K9 BALLISTICS, INC.
CAMARILLO
4/15/2020
$150,000-350,000
LABEL DADDY
PARTNERS, LLC
CHATSWORTH
4/28/2020
$150,000-350,000
LABEL DADDY
PARTNERS, LLC
CHATSWORTH
5/21/2020
$350,000-1 million
LAND GORILLA, LLC
SAN LUIS OBISPO
6/12/2020
$350,000-1 million
LAND GORILLA, LLC
SAN LUIS OBISPO
4/14/2020
$350,000-1 million
LARGE INVESTMENT
GROUP, INC.
TUSTIN
6/30/2020
$350,000-1 million
LARGE INVESTMENT
GROUP, INC.
TUSTIN
6/30/2020
$350,000-1 million
M LIBRUSH
CONSTRUCTION, INC
LOS ANGELES
5/3/2020
$150,000-350,000
M LIBRUSH
CONSTRUCTION, INC
LOS ANGELES
5/3/2020
$350,000-1 million
MAGNUSON
PRODUCTS, LLC
VENTURA
4/29/2020
$350,000-1 million
MAGNUSON
PRODUCTS, LLC
VENTURA
4/28/2020
$150,000-350,000
MH HOMES, LLC
IRVINE
6/27/2020
$150,000-350,000
MH HOMES, LLC
IRVINE
6/30/2020
$150,000-350,000
MICRO GROW
GREENHOUSE
SYSTEMS
TEMECULA
5/3/2020
$150,000-350,000
MICRO GROW
GREENHOUSE
SYSTEMS
TEMECULA
6/18/2020
12
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 12 of 27 Page ID
#:12
$350,000-1 million
MICRODYNE
PLASTICS, INC.
COLTON
6/23/2020
$350,000-1 million
MICRODYNE
PLASTICS, INC.
COLTON
6/3/2020
$150,000-350,000
N BHULLAR, INC.
ARCADIA
5/1/2020
$150,000-350,000
N BHULLAR, INC.
DUARTE
4/30/2020
$150,000-350,000
NEIGHBORHOOD
PHARMACY,
INC.
CAMARILLO
5/3/2020
$150,000-350,000
NEIGHBORHOOD
PHARMACY,
INC.
CAMARILLO
4/28/2020
$150,000-350,000
NEW WORLD
EMPIRE TRADING,
INC.
SHERMAN OAKS
6/22/2020
$150,000-350,000
NEW WORLD
EMPIRE TRADING,
INC.
SHERMAN OAKS
6/11/2020
$350,000-1 million
OC VETERINARY
MEDICAL CENTER,
INC.
ORANGE
5/3/2020
$150,000-350,000
OC VETERINARY
MEDICAL CENTER,
INC.
ORANGE
4/27/2020
$350,000-1 million
OLA, INC
HUNTINGTON
BEACH
4/28/2020
$150,000-350,000
OLA, INC
SANTA
BARBARA
4/28/2020
$350,000-1 million
OLD MISSION
SCHOOL
SAN JUAN
CAPISTRANO
4/15/2020
$150,000-350,000
OLD MISSION
SCHOOL
SN LUIS OBISP
6/11/2020
$150,000-350,000
ORRTEK, INC.
SYLMAR
4/29/2020
$150,000-350,000
ORRTEK, INC.
SYLMAR
5/3/2020
13
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#:13
$150,000-350,000
OTTIMO
RESOURCES, INC.
LOS ANGELES
6/15/2020
$150,000-350,000
OTTIMO
RESOURCES, INC.
LOS ANGELES
6/16/2020
$150,000-350,000
PACIFIC ANTENNA
SYSTEMS
CAMARILLO
5/6/2020
$150,000-350,000
PACIFIC ANTENNA
SYSTEMS
CAMARILLO
4/28/2020
$1-2 million
PANDA MOTORS,
INC.
SANTA ANA
4/ 13/2020
$350,000-1 million
PANDA MOTORS,
INC.
FULLERTON
4/13/2020
$150,000-350,000
PIG N WHISTLE, LLC
LOS ANGELES
5/3/2020
$150,000-350,000
PIG N WHISTLE, LLC
LOS ANGELES
5/3/2020
$150,000-350,000
POSH MANAGEMENT VENICE
5/1/2020
$150,000-350,000
POSH MANAGEMENT INGLEWOOD
5/3/2020
$150,000-350,000
POWERI
INTEGRATED, INC.
BEVERLY HILLS
6/29/2020
$150,000-350,000
POWERI
INTEGRATED, INC.
BEVERLY HILLS
6/30/2020
$350,000-1 million
PROMAX
INTERNATIONAL /
BPME
LOS ANGELES
4/29/2020
$350,000-1 million
PROMAX
INTERNATIONAL /
BPME
LOS ANGELES
4/28/2020
$150,000-350,000
RADEGY, INC.
NORTH
HOLLYWOOD
5/5/2020
$150,000-350,000
RADEGY, INC.
LOS ANGELES
5/3/2020
14
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 14 of 27 Page ID
#:14
$150,000-350,000
RESERVE
DIVERSIFIED, INC.
PERRIS
6/30/2020
$150,000-350,000
RESERVE
DIVERSIFIED, INC.
PERRIS
5/3/2020
$1-2 million
RNC CAPITAL
MANAGEMENT, LLC
LOS ANGELES
5/3/2020
$1-2 million
RNC CAPITAL
MANAGEMENT, LLC
LOS ANGELES
4/ 14/2020
$150,000-350,000
SHAZOH, INC.
RIVERSIDE
5/8/2020
$150,000-350,000
SHAZOH, INC.
TRABUCO
CANYON
6/26/2020
$150,000-350,000
SIOUX TRUCKING,
INC.
SANTA ROSA
VALLEY
5/1/2020
$150,000-350,000
SIOUX TRUCKING,
INC.
SANTA ROSA
VALLEY
5/3/2020
$1-2 million
SO CAL PF, LLC
CARSON
5/3/2020
$150,000-350,000
SO CAL PF, LLC
INGLEWOOD
5/3/2020
$150,000-350,000
SOCIALWISE, INC.
IRVINE
4/28/2020
$150,000-350,000
SOCIALWISE, INC.
IRVINE
4/16/2020
$150,000-350,000
Southern California
Medical Grou
GLENDALE
4/16/2020
$150,000-350,000
Southern California
Medical Grou
LOS ANGELES
4/30/2020
$2-5 million
SOUTHWESTERN
INDUSTRIES, INC.
RANCHO
DOMINGUEZ
4/27/2020
$2-5 million
SOUTHWESTERN
INDUSTRIES, INC.
RANCHO
DOMINGUEZ
4/27/2020
$150,000-350,000
SPYDERBUILT
HERMOSA
BEACH
4/27/2020
$150,000-350,000
SPYDERBUILT
HERMOSA
BEACH
4/27/2020
is
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 15 of 27 Page ID
#:15
$150,000-350,000
ST. ALOYSIUS
GONZAGA SCHOOL
LOS ANGELES
4/29/2020
$150,000-350,000
ST. ALOYSIUS
GONZAGA SCHOOL
LOS ANGELES
4/30/2020
$1-2 million
STAR ELECTRIC, INC. FULLERTON
5/4/2020
$1-2 million
STAR ELECTRIC, INC. FULLERTON
6/30/2020
$150,000-350,000
SL7NSET SLEEP LABS,
LLC
SIMI VALLEY
4/28/2020
$150,000-350,000
SUNSET SLEEP LABS,
LLC
SIMI VALLEY
5/1/2020
$350,000-1 million
SUPERIOR
ENTERPRISES, LLC
GLENDALE
5/12/2020
$150,000-350,000
SUPERIOR
ENTERPRISES, LLC
GLENDALE
5/14/2020
$150,000-350,000
SWINDEMAN
TRADING, LLC
HUNTINGTON
BEACH
4/30/2020
$150,000-350,000
S WINDEMAN
TRADING, LLC
HUNTINGTON
BEACH
6/29/2020
$150,000-350,000
THE LITTLE
MARKET, INC.
SANTA ANA
4/30/2020
$150,000-350,000
THE LITTLE
MARKET, INC.
CAYUCOS
5/2/2020
$150,000-350,000
TOMNATCO,
INC.
CORONA
4/28/2020
$150,000-350,000
TOMNATCO,
INC.
CORONA
5/3/2020
$150,000-350,000
UNITED GLOBAL
NEWS
BEVERLY HILLS
6/28/2020
$150,000-350,000
UNITED GLOBAL
NEWS
BEVERLY HILLS
6/30/2020
$350,000-1 million
VAYSFELD
STUDIOUS, LLC
WOODLAND
HILLS
6/28/2020
16
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 16 of 27 Page ID
#:16
$350,000-1 million
VAYSFELD
STUDIOUS, LLC
WOODLAND
HILLS
6/29/2020
$150,000-350,000
WEST COAST
CHASSIS
WESTLAKE
VILLAGE
5/27/2020
$150,000-350,000
WEST COAST
CHASSIS
THOUSAND
OAKS
6/16/2020
$150,000-350,000
WEST COAST
CHASSIS
WESTLAKE
VILLAGE
6/30/2020
$350,000-1 million
WILLIAM B, LLC
SHERMAN OAKS
4/10/2020
$150,000-350,000
WILLIAM B, LLC
SHERMAN OAKS
5/3/2020
$350,000-1 million
WOODCREST
SCHOOLS, INC.
TARZANA
4/29/2020
$350,000-1 million
WOODCREST
SCHOOLS, INC.
TARZANA
4/15/2020
$150,000-350,000
WOODLAND HILLS
FIREPLACE SHOP
WOODLAND HLS
4/15/2020
$150,000-350,000
WOODLAND HILLS
FIREPLACE SHOP
WOODLAND
HILLS
4/30/2020
2 12.
According to the PPP application discussed below, owners of
3 Defendants include partners or members owning 20% or more equity in the
4 company. Upon information and belief, and after further discovery in this matter,
s Relator anticipates he will need to amend this Complaint to add in such owners or
6 representatives as co-defendants if they were complicit in the fraudulent
misrepresentations listed herein.
~~
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 17 of 27 Page ID
#:17
i
JURISDICTION AND VENUE
2 13.
This Court has jurisdiction over the subject matter of this action
3 pursuant to 28 U.S.C. § 1331 and 31 U.S.C. § 3732, the latter of which specifically
a confers jurisdiction on this Court for actions brought pursuant to 31 U.S.C. §§
s 3729 and 3730. Although this issue is no longer jurisdictional after the 2009
6 amendments to the FCA, to Realtor's knowledge there has been no statutorily
~ relevant public disclosure of the "allegations or transactions" in this Complaint, as
s those concepts are used in 31 U.S.C. § 3730(e), as amended by Pub. L. No. 111-
9
148, § 10104(j)(2), 124 Stat. 119, 901-02.
Zo
14.
Moreover, whether or not such a disclosure has occurred, Relator
Zi
would qualify as an "original source" of the information on which the allegations
12
or transactions in this Complaint are based. Plaintiff researched and discovered
13 through a records request the pertinent dates of formation and other related entity
14 information of each Defendant.
15
15.
This Court has personal jurisdiction over Defendants pursuant to 31
16 U.S.C. § 3732(a) because that section authorizes nationwide service of process and
i~
because Defendants are California entities.
Zs
16.
Venue is proper in the Central District of California pursuant to 28
19 U.S.C. § 1391(b)-(c) and 31 U.S.C. § 3732(a) because Defendants can be found in
20 and/or transacted business in this district, and because violations of 31 U.S.C. §§
is
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 18 of 27 Page ID
#:18
1
3729 et seq. alleged herein occurred within this district. At all times relevant to this
2 Complaint, Defendants regularly conducted substantial business within this
3 district.
4 THE PAYCHECK PROTECTION PROGRAM
s 17.
Congress added sections 1102 and 1106 of the Coronavirus Aid,
6 Relief, and Economic Security Act ("CARES Act"). Section 1102 contains a new
~ program called the Paycheck Protection Program ("PPP") and is party of the U.S.
s Small Business Administration's ("SBA") 7(a) Loan Program. These two sections
9 are intended to provide economic relief to small businesses nationwide adversely
10 impacted by the coronavirus pandemic and the COVID-19 Emergency Declaration
11
issued by President Trump on March 13, 2020.
12
18. Due to the COVID-19 emergency, many small businesses nationwide
13 are experiencing economic hardship as a direct result of the Federal, State, and
14
local public health measures that are being taken to minimize the public's exposure
ss
to the coronavirus.
16
19.
The SBA received funding and authority through the CARES Act to
1~
modify existing loan programs and establish the new PPP loan program to assist
Zs
small businesses nationwide adversely impacted by the coronavirus pandemic.
19
20.
Section 1102 of the Act temporarily permits SBA to guarantee 100%
20 of 7(a) loans under the PPP. Section 1106 of the CARES Act provides for
T~
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 19 of 27 Page ID
#:19
1
forgiveness of up to the full principal amount of qualifying loans guaranteed under
z the PPP.
3 21. The CARES Act was intended to provide relief to America's small
4 businesses expeditiously.
s 22. The CARES Act gives lenders delegated authority to process loan
6 applications for PPP funding. SBA allowed lenders to rely on certifications of the
~ borrowers in order to determine eligibility of the borrower and use of loan
s proceeds, and to rely on specified documents provided by the borrower to
9 determine qualifying loan amount, and eligibility for loan forgiveness. Lenders are
Zo
held harmless for borrowers' failures to comply with PPP rules.
11
23.
Borrowers had to submit documentation necessary to establish
12
eligibility such as payroll processor records, payroll tax filings, form 1099s,
13 income and expenses documentation.
14
24.
In general, Borrowers calculated an amount to borrow by aggregating
ss
payroll costs from the previous 12 months for employees whose principal place of
16
residence is the United States. Annual employee salaries are capped at $100,000.
1~
The borrower then calculated the average monthly payroll cost and multiplied that
Zs amount by a factor of 2.5.
20
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 20 of 27 Page ID
#:20
1
25. One certification on the Application states, "Current economic
2 uncertainty makes this loan request necessary to support the ongoing operations of
3 the Applicant."
4 26. Each Defendant certified on their PPP applications that "[d]uring the
s period beginning on February 15, 2020 and ending on December 31, 2020, the
6 Applicant has not and will not receive another loan under the Paycheck Protection
~ Program."
s 27.
Defendants also "further certify that the information provided in this
9 application and the information provided in all supporting documents and forms is
Zo
true and accurate in all material respects."
11
28.
Finally, all Defendants certified that they "understand that knowingly
12 making a false statement to obtain a guaranteed loan from SBA is punishable under
13 the law, including under 18 USC 1001 and 3571 by imprisonment of not more than
14 five years and/or a fine of up to $250,000; under 15 USC 645 by imprisonment of
15
not more than two years and/or a fine of not more than $5,000; and, if submitted to
16 a federally insured institution, under 18 USC 1014 by imprisonment of not more
1~
than thirty years and/or a fine of not more than $1,000,000."
18
19
20
21
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 21 of 27 Page ID
#:21
1
ALLEGATIONS
2 29.
According to the Small Business Administration (SBA), California-
3
based entities who applied for and received at least $150,000 in PPP funds totaled
a approximately 87,691.
s 30.
Plaintiff reviewed and analyzed data from the SBA to identify
s California-based entities who applied more than once for PPP funds. Plaintiff then
~ cross-checked that data with the California Secretary of State's website to confirm
s various data points and information and fully identify entities who unlawfully
9 applied more than once for PPP funds. The result was the above-named Defendants
so
for this federal district of California.
11
31.
Defendants each certified on their PPP applications that "[d]uring the
i2
period beginning on February 15, 2020 and ending on December 31, 2020, the
13
Applicant has not and will not receive another loan under the Paycheck Protection
14 Program."
15
32.
Defendants thus made material misrepresentations on their
16
applications for PPP funds, knowing lenders and the Federal Government would
1~
rely on said representations in paying PPP funds to Defendants.
Zs
33.
Relator reserves the right to amend this Complaint and expand these
19
allegations upon review of the actual applications and supporting documentation
Zo
submitted by Defendants.
22
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 22 of 27 Page ID
#:22
1
False Claims Act
z 31 U.S.C. ~ 3729(a)(1)(A)-(B)
3 34.
Relator realleges and incorporates by reference the allegations
a contained in the foregoing paragraphs as though fully set forth herein.
s 35.
This is a claim for treble damages and penalties under the False
6 Claims Act, 31 U.S.C. § 3729, et seq., as amended.
~ 36. By virtue of the acts described above, Defendants knowingly
s presented or caused to be presented, false or fraudulent claims to the United States
9 Government, or authorized agent of the United States Government, for payment or
Zo
approval.
11
37. By virtue of the acts described above, Defendants knowingly made or
ii
used, or caused to be made or used, false or fraudulent records or statements
13
material to false or fraudulent claims for payment by the Government.
14
38.
Relator cannot at this time identify all of the false claims for payment
15
that were caused by Defendants' conduct. The false claims were presented to third
16
party lending institutions. Relator does not have access to the records of all such
1~
false or fraudulent statements or claims.
18
39.
Lenders, acting on behalf of the Federal Government, were
19 guaranteed 100% of the PPP loans. Said lenders were unaware of the falsity of the
23
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 23 of 27 Page ID
#:23
1
records, statements, and claims made or caused to be made by Defendants. Said
z lenders paid the claims that would not be paid but for Defendants' illegal conduct.
3 40. By reason of Defendants' acts, the United States has been damaged,
4 and continues to be damaged, in a substantial amount to be determined at trial.
s 41.
Additionally, the United States is entitled to the maximum penalty of
6 up to $11,000 for each and every violation arising from Defendants' unlawful
~ conduct alleged herein.
s
PRAYER
9 WHEREFORE, qui tam Plaintiff/Relator prays for judgment against each
io
Defendant as follows:
1i
1. That this Court enter judgment against each Defendant in an amount
12
equal to three times the damages the United Sates has sustained because
13
of Defendant's actions, plus a civil penalty of not less than $5,500 and
14
not more than $11,000 for each violation of 31 U.S.C. § 3729;
15
2. That Relator be awarded the maximum amount allowed pursuant to 31
i6
U.S.C. § 3730(d);
1~
3. That Relator be awarded all costs of this action, including attorney's fees
1g
and expenses; and
19
4. That Relator recover such other relief as the Court deems just and proper.
zo
24
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 24 of 27 Page ID
#:24
DEMAND FOR JURY TRIAL
Pursuant to Rule 38 of the Federal Rules of Civil Procedure, Relator hereby
demands a trial by jury.
Dated: 9/7/2020
2s
Resnectfully submitted,
Case 2:20-cv-08497-MWF-AS Document 1 Filed 09/10/20 Page 25 of 27 Page ID
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