Okay, this is a follow up to my post from yesterday. In order to get the entire picture of what is happening in this case, one needs to first start with how we got here? How, when and why did a receiver end up being appointed? You asked and the courts have so kindly delivered. This 115 page document on April 18, 2019 helps us round out the details.
Page one actually opens with the filing about Global Baristas. In a strange way, Global Barista’s bankruptcy and EA’s bankruptcy are all victims of Avenatti hiding money, transferring money to other accounts and not disclosing assets. The parties also appear to agree that a Receiver needs appointing because any funds transferred to Global Baristas US, LLC were fraudulent transfers from Eagan Avenatti LLP (referred to in the next document as EA). The document also attached the indictments filed in California because charges against him involve him obstructing IRS collections activities relating to Global Baristas US.
The way I am interpreting the document is that the Chapter 7 Trustee is saying that since the transfers were illegal, that they are in fact owed damages in the amount of the transfers. Whatever money was transferred to EA, that money is now owed to Global Baristas.
One user on Twitter, known as @opinionspher examined the document and took two scrabs and offered their expert opinion on them:
“Avenatti signed all assets of Global to himself. They want the court to return the money he took from accounts and stop any future activity, including any assets he still has. It’s a little more complicated, but that’s the general idea.””Avenatti signed all assets of Global to himself. They want the court to return the money he took from accounts and stop any future activity, including any assets he still has. It’s a little more complicated, but that’s the general idea.”
It is so hard to summarize everything that Avenatti failed to do, but a table contents give us a clear understanding of why a receiver needs to be appointed for EA. Some of his actions included:
- During Bankruptcy, Avenatti Secretly Deposited EA Fees From The Barela Ligitation Into Undisclosed Accounts and Then Transferred the Money to Pay-Off Avenattis Personal Debts.
- During Bankruptcy, EA Received Millions of Dollars From Another Case EA Failed to Disclose On Its Schedule of Assets.
Keep in mind that these things were things he is being charged within the California indictment. He shouldn’t’ have done that anyway but complicates matters with his bankruptcy settlements.