JAZ SUCCESSFULLY REPRESENTS RECEIVER IN CONNECTION WITH CONTEMPT JUDGMENT AGAINST DEFAULTED BORROWER

JAZ, A PROFESSIONAL LEGAL CORPORATION, REPRESENTED A BUSINESS RECEIVER IN CONNECTION WITH A CONTEMPT TRIAL INVOLVING A DEFAULTED MULTI-MILLION DOLLAR COMMERCIAL LOAN.  AFTER MULTIPLE DAYS OF TESTIMONY, the COURT ISSUED A JUDGMENT FINDING A BORROWER AND ITS PRINCIPAL GUILTY OF SIX COUNTS OF CONTEMPT OF COURT UNDER CODE OF CIVIL PROCEDURE SECTIONS 1209(a)(5) and A(9), RULING THAT THE DEFENDANTS VIOLATED A RECEIVERSHIP ORDER BY MISAPPROPRIATING FUNDS AND FAILING TO TIMELY TURN OVER THE BUSINESS AND ITS ASSETS TO THE RECEIVER.  THE DECISION WAS ISSUED BY HON. ROBERT O’BRIEN IN BANK OF AMERICA, NA V. MEDI-PEDIC BEDDING CO. ET AL. (Case No. bC485815).  FOR A COPY OF THE DECISION, CLICK HERE.

WHY IS THIS IMPORTANT?  OFTEN TIMES, SECURED COMMERCIAL LENDERS ARE ILLEGITIMATELY ABUSED BY RECALCITRANT BORROWERS.  BORROWERS, WHO QUITE HAPPILY PLEDGED THEIR ASSETS WHEN THEY NEEDED FINANCING, SOMETIMES FEEL THE NEED TO STICK THEIR MIDDLE FINGER IN THE AIR WHEN THEY DEFAULT.  THIS OFTEN MANIFESTS ITSELF WHEN A SECURED LENDER SEEKS TO APPOINT A RECEIVER, AND USUALLY RESULTS IN DESTROYED BOOKS AND RECORDS AND LOST CASH.  IF YOU ARE A LENDER THAT IS FACING AN UNCOOPERATIVE BORROWER, IT IS IMPORTANT TO KNOW HOW TO EFFICIENTLY DRAW THE LINE.  IF YOU DON’t STAND FOR SOMETHING, YOU’LL FALL FOR EVERYTHING.

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