Professional Documents
Culture Documents
Plaintiff, Complete Business Solutions Group, Inc. by and through its attorney, Norman
M. Valz file this Motion for Sanction against Defendant for obstructing the court-ordered
merchant cash advance transactions managed by Defendant, CBSG has incurred unnecessary
accounting and counsel fees and costs in due to Defendants willful obstruction and disregard for
this Courts Order. CBSG invested $4,095,474.57 in this Portfolio and has not received
$808,262.99 on its promised Rights to Return (RTR) based on the Portfolio. Over 75.9% of
the RTR in the Portfolio has not been paid allegedly due to defaults.
2. Subsequent to the entry of said Motion, Defendant used every mean to delay, obfuscate or deny
3. The initial teleconference between the Accounting team and Defendant was to have taken place
on or before May 15, 2017, however Defendants were unresponsive and would not respond to emails
which Plaintiff initiated May 10th. Said initial telephone conference did not take place until May 22nd,
uncooperative and employed many delay tactics. (See Exhibit B attached herewith which is our expert
5. For instance, Ms. Vallens report indicates that the first scheduled onsite meeting with
Defendants head of accounting was July 28, 2017. Ms. Vallen and another member of her team arrived
at Defendants offices on Wednesday July 28, 2017 at 10 am as planned. However, they were not able
to get in touch with Mr. Contreras for almost an hour after their arrival and were forced to wait in the
lobby until he, or someone at his direction, returned Ms. Vallens calls and allowed security to let us
paragraphs in Exhibit B]) indicates that many meetings with Defendants staff were abruptly cut short by
the last minute and would try to reschedule for a later date (paragraphs 35-37); That Defendants staff
would show up for scheduled meetings with no documentation of records (paragraphs 38-40, and 51 );
determination from a sample that over $300,000.00 in accounts which were reported to Plaintiff as being
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in Legal, were actually listed as being Satisfied in Defendants Profit Report. (Exhibit B, paragraph
8. Most of the reports provided to CBSG by the Defendant simply lists the allegedly non-performing
assets and states that they have been sent to Legal with no further information. It is believed that
Legal is referring to files sent not to an independent law firm, but to Rubin Law which is managed and
9. Accountant also found that funds were comingled as there were not separate accounts for the
10. Plaintiff counsel has incurred accounting fees of $17,559.50 during the course of the investigation
(Exhibit C)pursuant to this Courts Order of May 2, 2017 and which remains largely incomplete due
solely to the Defendants failure to abide by the terms of the Court Order (Exhibit A).
11. Plaintiffs legal counsel has billed Plaintiff an additional $4653.25 in billable hours in drafting the
Motion for the May 2nd 2017 Court Order, in Drafting this Motion, and in setting up the original
12. Pennsylvania Rule of Civil Procedure 4019 permits the Court to sanction a party for discovery
misconduct, including, inter alia, where a party fails to appear for a noticed deposition, fails to produce
documents, or otherwise fails to obey an order respecting discovery or make discovery. See Pa.R.Civ.P.
13. The type of sanction to be imposed on a recalcitrant party is within the Court's discretion and
includes entering a judgment of non pros against a disobedient counterclaim Plaintiff and the preclusion
of Defendants introduction of or any other order as is just, such as dismissal of a counterclaims with
14. Pennsylvania appellate courts have affirmed and approved of sanction orders entering judgment
against a plaintiff for discovery conduct that demonstrates a willful disregard for court orders and the
rules of discovery, including the defiant refusal to appear for a court ordered deposition. Verbalis v.
Verbalis, 428 A.2d 646 (Pa. Super. 1981) (entering judgment non pros for refusal to appear for court
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ordered deposition); Sahutsky v. Mychak, Geckle & Welker, P.e., 900 A.2d 866 (Pa. Super. 2006), il
denied 916 A.2d 1103 (Pa. 2007) (entering judgment non pros for refusal to obey discovery orders);
Lawrence v. General Medicine Assoc., Ltd., 602 A.2d 1360 (Pa. Super. 1992) (same); Poulos v. Com.,
Dept. of Transp., 575 A.2d 967 (Pa. Commw. 1990) (same); McSloy v. Jeanes Hosp., 546 A.2d 684 (Pa.
Super. 1988) (same); Pride Contracting, Inc. v. Biehn Construction, Inc., 553 A.2d 82 (Pa. Super. 1989),
il denied 565 A.2d 1167 (Pa. 1989) (dismissing complaint for willful disregard of discovery orders);
Jetson Direct Mail Services, Inc. v. Dept. of Labor and Indus., State Workmen's Ins. Fund, 782 A.2d 631
(Pa. Commw. 2001), il denied 797 A.2d 917 (Pa. 2002) (same).
15. Permitting Plaintiff to escape without sanction would not only severely prejudice CBSG ability to
defend against Plaintiff s claims for $15 million, but would set an awful precedent for future recalcitrant
litigants like Plaintiff: openly defy court orders that are against your interests and you may get what you
want anyway.
16. Dismissal of Defendants frivolous Counterclaims is an appropriate sanction for such obdurate
misconduct.
17. But for Defendants willful violation of the May 2, 2017 Court Order, Plaintiff would not have
18. This Courts Order of May 2, 2017 specifically states _If the Accountants are willfully denied
any access to any materials reasonably necessary to conduct this accounting (either directly or through
non-cooperation), Defendant shall be liable for any direct expense incurred due to said denial, and shall
have a negative inference placed against it with regard to the information sought; (See Exhibit A)
19. Additionally, Consequently, CBS is entitled to counsel fees and costs pursuant to
20. The severe prejudice to CBSG resulting from Defendant in this drawn out litigation is
plain. Without access to the information Defendant is withholding, Plaintiff cannot accurately
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WHEREFORE, Plaintiff respectfully requests that this Honorable Court enter an Order sustaining
its Preliminary Objection pursuant to Pa.R.C.P. 1028(a)(2) based on failure to conform, and strike
Defendants Answer, New Matter and Counter Claims in their entirety with prejudice
Respectfully Submitted,
________________________
Norman M. Valz, Esq. Attorney for Plaintiff
Law Office of Norman M. Valz
PA I.D. No. 61338
Attorney for the Plaintiff
205 Arch Street 2nd Floor
Philadelphia, PA 19106
Tel. (215) 756-2424/ Fax (215) 568-6881
nvalz@msn.com
August 29, 2017