10 12 1B 4 15 16 7 18 19 20 21 2 2B 24 25 26 27 28 CONFORMED Copy ORIGINAL FILED BARNES & THORNBURG LLP Supetior Courtof California STEPHEN R. MICK (SBN 131569) County of Los Anasles DAVID W. NELSON (SBN 240040) JUN 30 2016 2029 Century Park East, Suite 300 nee Angeles, Calitrnis 2067-20 12 lephone:310-284- her Carte, Executive Oftce/er Facsimile: 310-284-3894 ee ay dul are Dope Attorneys for Plaintiff LMNO CABLE GROUP, INC. SUPERIOR COURT OF THE STATE OF CALIFORNIA FOR THE COUNTY OF LOS ANGELES MNO CABLE GROUR INC.,a Case No. BCS 25749 Plainti COMPLAINT FOR: ve (1) BREACH OF FIDUCIARY DUTY; PAUL IKEGAMI, an Individual; (2) CONVERSION; IKEGAMI & CO. INC., a California corporation; and DOES 1-15, inclusive, g VIOLATION OF CAL. PENAL COD! 196 — RECEIVING STOLEN PROPERTY; (4) COMMON COUNT - IMPLIED CONTRACT; (5) BREACH OF CONTRACT; (©) FRAUD; (7) PROFESSIONAL NEGLIGENC! (8) INTENTIONAL INTERFERENCE WITH CONTRACT; (9) CIVIL EXTORTION; (10) VIOLATION OF CAL. BUS. & PROF. CODE § 17200, ET SEQ. Defendants. [Demand for Jury Trial] COMPLAINT [DEMAND FOR JURY TRIAL]For many years, Plaintiff LMNO Cable Group, Inc. (“LMNO”) trusted its financial affairs — including accounting, bookkeeping, payments, receipts, and preparation of tax returns to a small, family-run accounting firm in Torrance: Ikegami & Co. LMNO’s owners developed a deep personal and professional relationship with the firm’s founding partner, Ben Tkegami, and came to know his family, including son Paul who also worked in the business. In 2008, when Ben began to step back from the business, defendant Paul Ikegami (“Ikegami”) took over primary responsibility for LMNO’s account, representing to LMNO that he was a licensed CPA fully capable of performing the same services that as his father. Between 2008 and 2011, LMNO allowed Ikegami greater and greater access and control over the books and records of LMNO. Ikegami would betray that trust. Beginning in at least [April 2010 and lasting through October 2015, Ikegami used his control over LMNO’s payment system and accounting system to embezzle funds, and further used his control over LMNO’s books and records to falsify entries to hide his embezzlement. Then, when Ikegami’s behavior [became erratic and LMNO decided to hire a new accountant in October 2015, Ikegami tried to hide his theft by withholding LMNO’s records, attempting to extort LMNO for more than $800,000, and — when his demand was not met — sought to destroy LMNO by dumping its physical records into dumpsters, and then telling lies to LMNO’s largest customer about the financial records (over which Ikegami had exercised control for years, and had repeatedly falsified). LMNO is only now beginning to piece together the full extent of Ikegami’s fraud and Jembezzlement, Virtually everything about Ikegami turns out to be fraudulent — down to the basic and original lie that he was even a CPA. LMNO has discovered more than $1,500,000 in junauthorized payments that Ikegami made to himself through a variety of schemes. By this Complaint, LMNO seeks redress for Ikegami’s theft, fraud, and betrayal, alleging causes of action for: (1) breach of fiduciary duty; (2) conversion; (3) violation of Cal. Penal Code § 496; (4) common count ~ implied contract; (5) breach of contract; (6) fraud; (7) professional negligence; (8) intentional interference with contractual relations; (9) civil Jextortion; and (10) violation of Cal. Bus. & Prof. Code § 17200, et seg. 1 COMPLAINT & DEMAND FOR JURY TRIALB 4 15 16 7 18 19 20 21 22 23 24 25 26 27 28 PARTIES 1. LMNO is a California corporation with its principal place of business in Los Angeles, California. LMNO is a full-service television production company, which has produced Emmy Award-winning, hit programs for network, cable, and syndicated television. 2, Upon information and belief, defendant Ikegami & Co. Ine. is a California corporation with its principal place of business in Torrance, California, 3. Upon information and belief, defendant Paul Ikegami (“Ikegami”) is an individual who resides in Los Angeles County, California. Upon information and belief, Tkegami has either a direct or indirect economic interest in and managerial control over Ikegami & Co., and at all relevant times alleged in this Complaint was acting as an agent of, and on behalf of, Ikegami & Co. (Ikegami and Ikegami & Co. are referred to together herein as “Defendants”), 4. The true names and capaci s of Defendants Does 1 through 15, inclusive, are ]unknown to LMNO, who therefore sues said defendants by such fictitious names. LMNO will amend this Complaint to state the true names and capacities of said fictitious defendants when they have been ascertained, LMNO is informed and believe, and thereon alleges, that [Defendants Does 1 through 15 are in some manner responsible for the occurrences herein, alleged, by virtual of one or more of the following acts: (a) aiding and abetting, and participating in Tkegami’s fraudulent schemes; (b) receiving illicit funds from Ikegami with knowledge of Ikegami’s wrongful acts to take those funds from LMNO; (c) receiving stolen property from Ikegami, consisting of either LMNO’s funds or LMNO’s books and records and other confidential financial information; and/or (d) conspiring with Ikegami to carry out Tkegami’s wrongful acts, or to conceal them after the fact. GENERAL ALLEGATIONS LMNO’s Relationship with Ikegami 5, In 1995, LMNO began utilizing the tax and accounting services of Ikegami’s father, Ben Ikegami, Starting in 2008, Ikegami began to assume primary responsibility for LMNO’s account, and later took over his father’s business when Ben passed away in 2012. 2 ‘COMPLAINT & DEMAND FOR JURY TRIALee Yaw eww 10 u 12 1B 4 15 16 7 18 19 20 21 22 23 24 25, 26 27 28 6. From the outset, Ikegami held himself out as a qualified and licensed CPA, and therefore entitled to practice accountancy within the meaning of the California Accountancy Act. 7. Tkegami’s letterhead advertised his status as a certified public accountant: Bes uw 8. Ikegami routinely signed documents purporting to be a CPA, including this 2011 correspondence on a loan application: Poul tkegami CPA "Wega & Co, LP and this 2010 application for a Los Angeles business license: Siaran = c— Pieanome: Pane No: mr G oa * si 5 19 Spee Atego cok 9. Asaresult, records and correspondence to and from Ikegami appeared to acknowledge his status as a CPA: 8. This was all a fraud. Ikegami is not, and never was a licensed CPA in California, or any other state. On information and belief, Ikegami has been illegally holding himself out 3 ‘COMPLAINT & DEMAND FOR JURY TRIALillegally practicing public accountancy in violation of the California Business & Professions Code, and systematically defrauding dozens of clients with respect to their accounting, tax and other matters for at least eight years. 9. Based on LMNO’s extensive, long-term relationship with Ikegami and his family business, and Ikegami’s representations regarding his CPA license and qualifications, LMNO trusted Ikegami with substantial control over the management of its financial affairs: he oversaw LMNO’s in-house finance department; he had the final approval on payment of invoices; he was authorized to draft and issue corporate checks; he was a signatory on LMNO’s bank accounts; he was responsible for bookkeeping and account reconciliation; he [prepared and oversaw LMNO’s invoicing and income from its customers and business partners; and he prepared all corporate tax returns. In exchange for Ikegami’s services, LMNO agreed to pay Ikegami a monthly fee of $3,500 per month, which later rose to $5,000 per month and then $5,500 per month, Ikegami’s Theft and Embezzlement from LMNO 10, _Tkegami was responsible for issuing LMNO company checks for payment of ‘vendor invoices, employee wages, and other company obligations. Ikegami, or employees reporting to Ikegami, would be responsible for inspection and approval of invoices, entry of information in LMNO’s accounting system, and issuance of checks. As a matter of practice, lonce or twice a week Ikegami would bring a folder containing a large number of issued checks for signature by LMNO executives, both company executives with signature authority. Because of the large volume of checks and their trust in Ikegami, LMNO’s executives would routinely sign the checks without close scrutiny. 11. On information and belief, Ikegami began his embezzlement scheme in approximately April 2010 by issuing two checks from LMNO’s account to Ikegami & Co., one {for the agreed monthly fee of $3,500 and a second unauthorized check for $8,925. This appears to have been a test to see if Schotz or Davis would notice or question this additional payment. After the additional payment went unnoticed, Ikegami continued issuing unauthorized checks on the LMNO account to Ikegami & Co. 4 COMPLAINT & DEMAND FOR JURY TRIAL14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 12. Over the next five years, Ikegami issued four to eight unauthorized checks from LMNO’s account to Ikegami & Co. each month, with monthly payments ranging from $21,225 to $91,965. In total, Ikegami stole and embezzled more than $1.5 million from LMNO through this check writing scheme. 13. To cover up his embezzlement, Ikegami doctored LMNO’s books to omit many of the fraudulently issued checks and to falsify payments to other entities so that LMNO’s books did not reflect the unauthorized payments to Ikegami and/or his company. 14. For example, Ikegami recognized that LMNO would make regular payments to the California Employment Development Department, and doctored LMNO’s books to show many payments to that agency throughout the years. LMNO’s accounting records show that check number 9172 was issued to the California Employment Development Department on May 7, 2014 for an amount of $1326.54: me me oe — jena Ses i Gant Seopa Sa Wom Er Sa. cnaay eemecienjeclgt St WGRGo Sw Thm In fact, LMNO’s investigation revealed that the cancelled check #9172 that was issued on that date was actually a payment to Ikegami & Co. for $6,000: none Se. BATES wemmtonre pes pa Iogaitcae SA "ato reset 0200 LMNO’s investigation has revealed at least eleven false entries in the records that appear to show checks written to the California EDD, when in fact the bank documents show cancelled checks made out to Ikegami or his company. To date, LMNO has uncovered many dozens of examples of other such false entries hiding embezzlement by Ikegami 5 COMPLAINT & DEMAND FOR JURY TRIAL17 18 19 20 21 22 23 24 25 26 27 28 15. Tkegami further used LMNO’s American Express card to make payments to hii company without permission or authorization. Ikegami disguised these payments by scheduling them as direct payments authorized through the accounting software, which then showed up on the company’s books as a payment to “Intuit.” Over a three year period, Tkegami charged 51 payments in this manner, which were in fact made to Ikegami & Co., for a total amount in excess of $250,000. 16. Because Ikegami handled all of LMNO’s financial affairs — its accounting, bookkeeping, and tax preparation — this scheme went on for years without detection. ‘The full extent of Ikegami’s manipulation of LMNO’s books and records remains unknown. Ikegami’s Cover-Up and Extortion of LMNO. 17. Inthe summer of 2015, LMNO began to have concerns about Tkegami’s behavior, which had become erratic. Finally, in October 2015, LMNO sent a detailed email to Ikegami describing problems that his behavior and performance were causing for LMNO, which led to LMNO’s decision to hire a new accountant. LMNO demanded that Ikegami return LMNO’s books and records. 18. Recognizing the danger of a new accounting firm reviewing his doctored books and records, and in an effort to leverage the harm that he could cause to LMNO by depriving it of all its financial records, Ikegami threatened that he would not return LMNO’s books and records unless LMNO give him a payoff of more than $800,000. Despite repeated demands from LMNO for the retum of its own books and records, Ikegami refused to comply with his, obligation to turn over the records of his client, LMNO. 19, When LMNO made clear that it would not give in to Ikegami’s demands, and that he had a legal obligation to return LMNO’s books and records, Ikegami ratcheted up his, extortion, In a November 26, 2015 email with the subject line “Scenarios Going Forward,” will only go one of two directions.” Either, he Ikegami threatened that “I’ve concluded that thi wrote, LMNO would pay him more than $800,000 and give him a release for his wrongdoing or, if LMNO did not agree to his demands, he would effectively use his doctored books and false allegations of impropriety to ruin LMNO’s business relationships. 6 ‘COMPLAINT & DEMAND FOR JURY TRIAL20. On information and belief, when LMNO refused to give in to his extortion, Ikegami contacted LMNO’s largest customer, and offered to provide the customer with information and documents showing purported accounting improprieties, using records that he had been responsible for preparing or maintaining, and which he stole from LMNO, to concoct, a story that LMNO was somehow engaged in wrongdoing. On information and belief, as a result of Ikegami’s actions, LMNO’s customer has taken actions to terminate its relationship with LMNO, causing LMNO substantial harm. 21. Onor about December 11, 2015, under threat that LMNO would file charges again him, Ikegami “returned” some of LMNO’s books and records by dumping them ~ in loose form ~ in a container. LMNO discovered the remains of its books and records in this condition: 22. LMNO estimates that there were approximately one million pages of documents in these boxes, which Ikegami intentionally mixed by dispersing each banker’s box of documents into various dumpster boxes, effectively preventing LMNO from recreating its files. Ikegami has refused to return electronically stored copies of the documents. 7 COMPLAINT & DEMAND FOR JURY TRIAL12 3 4 15 16 7 18 19 20 21 2 23 24 25 26 21 28 FIRST CAUSE OF ACTIO! Breach of Fiduciary Duty (Against Defendants) 23, LMNO repeats and realleges each of the allegations set forth in paragraphs 1 through 22, above, as though set forth in full herein. 24. As LMNO’s long-time, trusted accountant, who LMNO entrusted to control and manage their financial accounts and records, Ikegami and his company owed LMNO fiduciary duties, including but not limited to a duty of care and duty of loyalty. 25. Through the actions described above, Defendants have breached their fiduciary duty to LMNO by, including but not limited to: (a) misappropriating the assets of LMNO to their own accounts for their own use and benefit; (b) falsifying LMNO’s books and records; (©) failing to return, and then effectively destroying LMNO’s books and records; (@ __extorting LMNO with false allegations for their personal gain; and (©) failing to file tax returns. 26. LMNO has been harmed as a result in Defendants’ actions in breach of their fiduciary duty because, inter alia, LMNO has been deprived of the assets stolen by Defendants, it has sustained substantial costs to reconstruct and correct its books and records, and it has lost a valuable business relationship due to Defendants’ interference, false allegations, and doctored records. The exact amount of damage will be proven at trial. 27. Defendants” conduct was fraudulent, malicious, and oppressive, such that LMNO- is entitled to an award of punitive damages pursuant to Civil Code Section 3294. 8 ‘COMPLAINT & DEMAND FOR JURY TRIALSECOND CAUSE OF ACTION Conversion (Against Defendants) 28. LMNO repeats and realleges the allegations contained in Paragraphs 1 through 27, above, as though set forth in full herein. 29, LMNO owned, and had a right to possess, the funds wrongfully paid by Ikegami to himself and his company, Ikegami & Co. These payments each represent specific, identifiable sums of money that were to be paid to Tkegami and/or his company. LMNO further owned, and had the right to possess, its accounting books and records maintained by Defendants on LMNO’s behalf. 30. In breach of his fiduciary obligations to LMNO, Ikegami intentionally and substantially interfered with LMNO’s property by diverting LMNO’s funds to his company, Ikegami & Co., for his own use, taking possession of the funds and depriving LMNO of the funds. Defendants further intentionally and substantially interfered with LMNO’s property by refusing to turn over, and eventually effectively destroying, LMNO’s accounting books and records. 31. LMNO did not consent to Defendants taking or destroying its assets and property. 32, LMNO has been harmed as a result in Defendants’ actions because it has been deprived of the assets converted by Defendants and it has incurred substantial costs in an effort to recreate its accounting books and records and damages caused by its inability to use its accounting books and records. On information and belief, Defendants have misappropriated — ‘and LMNO has been damaged ~ in an amount in excess of $1.5 million, the exact amount to be proven at trial. 33. Defendants’ conduct was a substantial factor in causing LMNO’s harm. 34. Defendants” conduct was fraudulent, malicious, and oppressive, such that LMNO- is entitled to an award of punitive damages pursuant to Civil Code Section 3294. 9 COMPLAINT & DEMAND FOR JURY TRIALu 12 13 4 16 7 18 19 20 21 22 23 24 25 26 27 28 THIRD CAUSE OF ACTION Violation of California Penal Code Section 496 — Receiving Stolen Property (Against Defendants and Does 1-5) 35. LMNO repeats and realleges each of the allegations set forth in paragraphs 1 through 34, above, as though set forth in full herein. 36. California Penal Code § 496 creates a civil action against anyone who, inter alia, knowingly receives, conceals, withholds, or knowingly aids another in receiving, concealing, lor withholding any property obtained through theft, including larceny and embezzlement, ot extortion. 37. _ Arelationship of trust and confidence existed between Defendants and LMNO, pursuant to which Defendants acted as LMNO’s accountants, managed LMNO’s financial affairs, and had substantial control over the finances and funds of LMNO. 38. Pursuant to that relationship, Defendants managed funds belonging to LMNO for the benefit of LMNO and maintained accounting books and records on LMNO’s behalf. 39, With the specific intent to deprive LMNO of its property, Defendants appropriated and converted the LMNO’s funds for their own use and purpose, taking the funds from LMNO, and obtaining possession and control over the funds by the transfer of the funds to their own accounts. Defendants further refused to turn over, concealed, withheld, and effectively destroyed LMNO’s accounting books and records. 40, Through these actions, Defendants received, concealed, and withheld these funds and records that were owned by and the property of LMNO. 41. On information and belief, Does 1-5 received, concealed, and withheld funds and/or records stolen by Defendants with knowledge that the funds and/or records had been stolen. 42. At the time that Defendants and Does 1-5 received, concealed, and withheld the {funds and record, Defendants knew that the funds and records were the property of LMNO and knew that the funds and records were taken from LMNO by larceny and/or embezzlement, 43. Through these actions, Defendants have violated California Penal Code § 496(a). 10 ‘COMPLAINT & DEMAND FOR JURY TRIAL17 18 19 20 21 22 23 24 25 26 27 28 44, LMNO has been injured by Defendants’ violation of California Penal Code § 496(a) because LMNO has lost and been deprived of the stolen funds received, concealed, and withheld by Defendants and it has incurred substantial costs in an effort to recreate its accounting books and records and damages caused by its inability to use its accounting books and records. On information and belief, Defendants and Does 1-5 have received stolen funds ~ and LMNO has suffered actual damages — in excess of $1.5 million, the exact amount to be proven at trial 45, Under California Penal Code § 496(c), LMNO is entitled to three times the amount of actual damages that it has sustained, as well as payment of its reasonable attorneys" fees and costs of suit incurred in this action. FOURTH CAUSE OF ACTION ‘Common Count — Implied Contract (Against Defendants) 46. LMNO repeats and realleges each of the allegations set forth in paragraphs 1 through 45, above, as though set forth in full herein, 47. Defendants, through their embezzlement of funds belonging to LMNO, were unjustly enriched by the receipt of money which, as a matter of Jaw, they had no right to retain. 48. As amatter of law, Defendants’ unjust enrichment through the improper receipt and retention of LMNO’s property gives rise to an implied-in-law contractual obligation to restore the wrongfully taken and obtained funds to LMNO. 49. Inbreach of their implied contractual obligation, Defendants have refused to restore LMNO’s funds and continue to keep and maintain the monies taken from LMNO for their own use and benefit. 50. LMNO has been harmed and suffered damage as a result of Defendants’ failure to comply with its implied contractual obligation in a liquidated and clearly ascertainable amount in excess of $1.5 million, the exact amount to be proven at trial. ul COMPLAINT & DEMAND FOR JURY TRIALFIFTH CAUSE OF ACTION Breach of Contract (Against Defendants) 51. LMNO repeats and realleges each of the allegations set forth in paragraphs 1 through 50, above, as though set forth in full herein 52. LMNO and Defendants were parties to a valid, binding, and enforceable contract, [pursuant to which Defendants agreed to provide accounting, bookkeeping, and tax preparation services to LMNO in exchange for a monthly fee of $3,500, which would eventually be increased to $5,000 and then $5,500. 53. LMNO has fully performed his obligations under the contract. 54, Defendants have failed to perform and materially breached the contract by: (a) making unauthorized, fraudulent payments to their own accounts and for their own benefit; (b) failing to maintain accurate books and records for LMNO; (©) failing to return and effectively destroying LMNO’s books and records; and (@ failing to file corporate tax returns for LMNO. 55. As aresult of Defendants’ breach of the contract, LMNO has been damaged in an amount in excess of $1.5 million, the exact amount to be proven at trial. SIXTH CAUSE OF ACTION Fraud (Against Defendants) 56. _ LMNO repeats and realleges the allegations contained in Paragraphs | through 55, above, as though set forth in full herein, 57. As LMNO’s long-time, trusted accountant, Defendants were in a fiduciary relationship with LMNO. 2 COMPLAINT & DEMAND FOR JURY TRIALu 12 13 14 15 16 7 18 19 20 21 22 23 24 25 26 27 28 58. As referenced above, Ikegami repeatedly represented to LMNO, on behalf of Defendants, that he and his company were a licensed CPAs, including but not limited to on the letterhead of his stationary, in his signature blocks, on official documents prepared for LMNO and its related entities, and even in advertising for himself and his firm. Ikegami’s representations were false because, in fact, he was never a licensed CPA. 59, From approximately April 2010 through October 2015, Ikegami, on behalf of Defendants, falsified the books and records of LMNO by, inter alia, omitting payments made to Ikegami & Co. and including payments that were never made. There fraudulent omissions and misrepresentations include, but are not limited to, his false recording of check numbers, as evidenced in Paragraph 12 above. 60. Ikegami, on behalf of Defendants, intentionally concealed from LMNO: (a) that Ikegami was not a licensed CPA or tax preparer and Ikegami & Co. was not a licensed CPA firm, as evidenced above; (b) that Defendants were making unauthorized payments to their own accounts using LMNO funds; and (©) that the books and records of LMNO were not accurate because Defendants were doctoring the books to cover up their theft. LMNO did not know any of this concealed information. 61. Ikegami knew that each of his representations were false at the time that he made them. 62. Ikegami intended that LMNO rely on his false representations to continue doing business with Defendants, and intended to deceive LMNO by concealing the facts identified above. 63. LMNO reasonably relied on Ikegami’s affirmative representations in deciding to continue doing business with Defendants, and would not have continued to do business with Defendants had the concealed information been disclosed. 13 ‘COMPLAINT & DEMAND FOR JURY TRIAL10 u 12 13 4 45 16 7 18, 19 20 a 22 23 24 25 26 27 28 64. LMNO has been harmed because of Defendants’ false representations and concealments in an amount to be proven at trial, and LMNO’s reliance on Defendants’ false representations and concealments was a substantial factor in causing that harm. 65. Defendants’ conduct was fraudulent, malicious, and oppressive, such that LMNO is entitled to an award of punitive damages pursuant to Civil Code Section 3294, SEVENTH CAUSE OF ACTI Professional Negligence (Against Defendants) 66. LMNO repeats and realleges the allegations contained in Paragraphs | through 65, above, as though set forth in full herein. 67. Holding themselves out as accountants, Defendants had a duty to perform their duties with such skill, prudence, and diligence as other members of the accounting profession commonly possess and exercise in similar circumstances. 68. Defendants breached their duty to LMNO by, inter alia: (a) failing to maintain accurate books and records of the company; (b) wrongfully failing to turn over financial books and records that were the property of LMNO; (©) effectively destroying the financial books and records of LMNO; and (@)__ failing to file tax returns. 69. LMNO has suffered injury as a proximate result of Defendants’ negligence, including but not limited to substantial costs associated with recreating and correcting LMNO’s books and records. 70. LMNO has been damaged by Defendants’ negligence in an amount to be proven at trial 14 ‘COMPLAINT & DEMAND FOR JURY TRIALEIGHTH CAUSE OF ACTION Intentional Interference with Contractual Relations (Against Defendants) 71. LMNO repeats and realleges the allegations contained in Paragraphs 1 through 70, above, as though set forth in full herein. 72. There were a series of contracts in place between LMNO and Discovery Communications (“Discovery”). 73. Defendants knew of LMNO’s contractual relationship with Discovery. 74. On information and belief, Defendants disrupted the performance of LMNO’s contracts with Discovery by providing Discovery with false and misleading accounting records and other information implying that LMNO was somehow engaged in impropriety, and withheld and effectively destroyed LMNO’s accounting records to prevent LMNO from providing certain documentation to Discovery. On information and belief, as a result of Defendants’ actions, Discovery terminated its contracts with LMNO. 75. Defendants intended that their action would disrupt the contracts between LMNO and Discovery. 76. LMNO has been harmed by Defendants’ actions because it has lost valuable contracts with Discovery and it has incurred substantial costs in connection with such termination, all as a direct result of Defendants’ interference. 77. Defendants’ actions and interference were a substantial factor in causing LMNO’s harm, and have caused damage to LMNO in an amount to proven at trial, but presently believed to be in excess of $7 million, 78. Defendants’ conduct was fraudulent, malicious, and oppressive, such that LMNO is entitled to an award of punitive damages pursuant to Civil Code Section 3294. 15 ‘COMPLAINT & DEMAND FOR JURY TRIAL22 23 25 26 27 28 NINTH CAUSE OF ACTI Civil Extortion (Against Defendants and Does 6-10) 79. LMNO repeats and realleges the allegations contained in Paragraphs 1 through 78, above, as though set forth in full herein. 80. Defendants, acting in concert with and as part of a conspiracy with Does 6-10, sent a written message to LMNO expressly threatening that unless LMNO paid more than {$800,000 and provided a full release for past wrongdoings, that Defendants and/or Does 11-15 ‘would falsely accuse LMNO of criminal and/or di ‘with LMNO’s business relationships. 81. By these threats, Defendants intended to extort money from LMNO. 82. LMNO was harmed as a result of Defendants’ and Does 11-15’s extortion because, inter alia, it has expended substantial out of pocket sums in order to respond to the threats, including the costs of legal counsel and additional accountants, and the costs to recreate books and records destroyed as part of the extortion scheme, and Defendants have further lost revenues and valuable business relationships because of false information disclosed as part of the extortion scheme. 83. The harm to LMNO was caused by Defendants’ extortion. ‘TENTH CAUSE OF ACTION lation of Cal. Bus. & Prof. Code § 17200, et seq. (Against Defendants and Does 11-15) 84, LMNO repeats and realleges the allegations contained in Paragraphs 1 through 83, above, as though set forth in full herein. 85. Defendants have engaged in fraudulent and unfair business practices by making false and deceptive representations that Ikegami is a licensed CPA and by failing to disclose that Ikegami & Co. is not a licensed CPA firm and Ikegami is not a licensed tax preparer, which misrepresentations and nondisclosures are likely to cause, and have caused confusion 16 COMPLAINT & DEMAND FOR JURY TRIALregarding Defendants’ licenses and qualifications. But for Defendants’ false representations, and fraudulent violations of the California Accountancy Act, LMNO would not have engaged Defendants to perform any services, and would not have paid Defendants any sums at all. 86. Defendants and Does 11-15 have engaged in fraudulent and unfair business practices by improperly extorting LMNO for their personal gain. 87. Defendants and Does 11-15 have engaged in illegal business practices through their violations of Cal. Penal Code §§ 484, 487, 496, 503, 518, 530.8, and 532, and Cal. Bus. & Prof. Code §§ 5055, 5058, 5058.1, and 5060, 88. Defendants’ and Does 11-15’s unfair and unlawful business practices described above have caused, and unless enjoined will continue to cause, substantial and irreparable jury to LMNO for which LMNO has no adequate remedy at law. LMNO has further lost money or property as a result of Defendants’ unfair competition because, inter alia, LMNO ‘would not have done business with Defendants or paid Defendants any compensation if not for their false and deceptive representations and nondisclosures, and Defendants’ illegal business [practices have resulted in LMNO’s loss of what is presently believed to be in excess of $2.5 in total amounts paid by LMNO to Defendants. 89. LMNO is entitled to injunctive relief against Defendants, along with restitution of monies belonging to LMNO that were wrongfully diverted or otherwise obtained by Defendants and Does 11-15, in a sum to be proven at trial, but presently believed to be in excess of $2.5 million. PRAYER FOR RELIEF WHEREFORE, LMNO prays for judgment and other relief as follows: 1. For actual damages in an amount to be proven at trial, but presently believed to be in excess of $8 million; 2. For additional treble damages on LMNO’s third cause of action; 7 COMPLAINT & DEMAND FOR JURY TRIAL10 u 12 B 4 15 16 7 18 19 20 2 23 24 25 26 2 28 3. For restitution of all monies paid to Defendants by LMNO as a result of LMNO’s ‘unfair competition, in an amount to be proven at trial, but presently believed to be in excess of $2.5 million. 4, Fora constructive trust over funds wrongfully taken from LMNO through Defendants’ theft and embezzlement; 5. For punitive damages on LMNO’s first, second, fifth, and seventh causes of action; 6. Forattomeys’ fees and costs pursuant to Cal. Penal Code § 496 and as otherwise allowed by law; 7. Fora temporary and permanent injunction preventing Defendants from continuing their acts of unfair competition; and 8. For such other and further relief as this Court may deem just and proper. Dated: June 30, 2016 BARNES & THORNBURG LLP By. Siephen R. Mick Attorneys for Plaintift LMNO CABLE GROUP, INC. 18 COMPLAINT & DEMAND FOR JURY TRIAL2 23 25 26 27 28 ajury. Dated: JURY TRIAL DEMAND Plaintiff LMNO Cable Group, Inc. hereby demands a trial by jury on all issues triable to June 30, 2016 BARNES & THORNBURG LLP Stephen R Mick Attorneys for Plaintiff LMNO CABLE GROUP, INC. 19 COMPLAINT & DEMAND FOR JURY TRIAL