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United States v. An Interest in the Real Property Located at 17101-17111

UNITED STATES DISTRICT COURT FOR THE CENTRAL DISTRICT OF CALIFORNIA WESTERN DIVISION


July 27, 2009

UNITED STATES OF AMERICA, PLAINTIFF,
v.
AN INTEREST IN THE REAL PROPERTY LOCATED AT 17101-17111 HAWTHORNE BLVD., LAWNDALE, CALIFORNIA, DEFENDANT.
HAWTHORNE REAL ESTATE, LLC, F/K/A LAWNDALE CARWASH LLC, AND BENNY PIRIAN, CLAIMANTS.

The opinion of the court was delivered by: The Honorable Manuel L. Real United States District Judge

CONSENT JUDGMENT

The court having reviewed the stipulation of plaintiff United States of America and claimants Hawthorne Real Estate, LLC, f/k/a Lawndale Carwash LLC, and Benny Pirian requesting entry of this order, IT IS HEREBY ORDERED AS FOLLOWS:

1. The claimants in this action are Hawthorne Real Estate, LLC, f/k/a Lawndale Carwash LLC, and Benny Pirian. Hawthorne Real Estate, LLC, f/k/a Lawndale Carwash LLC and/or Lawndale Carwash LLC is the titleholder for the real property located at 17101-17111 Hawthorne Blvd., Lawndale, California.

2. On December 18, 2006, plaintiff United States of America commenced this judicial forfeiture action by filing a Complaint against the defendant, an Interest in the Real Property located at 17101-17111 Hawthorne Blvd., Lawndale, California (the "defendant property"). The Assessor's Parcel Numbers for the defendant property are 4081-028-032 and 4081-023-033, and a legal description of the property is attached to the parties' stipulation as Exhibit A. The government's complaint alleged that the defendant property is traceable to funds involved in violations of 31 U.S.C. §§ 5324(a)(1) and (a)(3), and/or a conspiracy to commit one or more of these offenses, and an interest in the property is therefore subject to forfeiture pursuant to 31 U.S.C. § 5317(c)(2). Hawthorne Real Estate, LLC, f/k/a Lawndale Carwash LLC, and Benny Pirian claim that they are the owners of the defendant property. In light of the parties' stipulation, these claimants are excused from the necessity of filing an answer to the government's complaint.

3. This Court has jurisdiction over the subject matter of the present action and over the parties to this agreement.

4. The Complaint states a claim for relief against the defendant property under 31 U.S.C. § 5317(c). Plaintiff has notified other potential claimants of this action pursuant to Supplemental Rule G for Admiralty or Maritime Claims and Asset Forfeiture Actions, Federal Rules of Civil Procedure. Notice of forfeiture of the defendant was published on January 5, 12, and 19, 2007 in the Los Angeles Daily Journal in accordance with Supplemental Rule G(4)(a)(iv)(C). Plaintiff United States has recognized the interests of Union Pacific Bank as assignee of Mirae Bank, arising from the deed of trust recorded September 1, 2006 on behalf of Mirae Bank in Los Angeles County as document number 06-1955584. The parties have informed the court that Network Bank, whose claims the government recognized in its complaint for forfeiture, no longer has an interest in the defendant property; a copy of the full reconveyance of its prior interest is attached to the parties' stipulation as Exhibit B. Other than those of the stipulating claimants, no claims have been filed to contest the forfeiture of the defendant, and the time for filing claims and answers has expired. All potential claimants to the defendant other than Hawthorne Real Estate, LLC, f/k/a Lawndale Carwash LLC, Benny Pirian, and Union Pacific Bank are deemed to have admitted the allegations of the complaint.

5. It is the intention of plaintiff United States of America and the claimants to resolve all of their competing claims to the defendant property by their stipulation and this Consent Judgment. By entering into the parties' stipulation, the stipulating claimants do not admit any factual or legal matter alleged in the government's complaint. In settlement of this action, Hawthorne Real Estate, LLC, f/k/a Lawndale Carwash LLC, and Benny Pirian shall pay to the United States $150,000.00 as a substitute res for the defendant property (the "Settlement Amount").

6. The Settlement Amount shall be paid to the United States as follows ("the payment schedule"):

a. $50,000.00 shall be paid not later than 10 calendar days after the Court enters and files this Consent Judgment, by delivering a cashier's check in that amount payable to "United States Treasury" to Chief, Asset Forfeiture Section, United States Attorneys' Office; 312 No. Spring St., 14th Floor; Los Angeles, CA 90012;

b. In addition, claimants shall make 11 monthly payments, each in the amount of $8,333.33, on or before the first day of each and every month beginning September 1, 2009 and ending July 1, 2010;

c. In addition, claimants shall pay a final payment in the amount of $8,333.37 on or before August 1, 2010; and

d. Claimants may pay the then-unpaid balance of the Settlement Amount at any time without penalty.

All payments towards the Settlement Amount made pursuant to subparagraphs 6(b)-(d) shall be paid to the United States in a manner to be designated by the United States and communicated in writing to claimants' undersigned counsel by on or about August 10, 2009. Until so designated, claimants may make any payment described by this Consent Judgment in the same manner as specified in subparagraph 6(a).

7. The following terms and conditions shall apply to payment(s) of the Settlement Amount:

a. All Settlement Amount funds paid shall become a substitute res for a portion of the defendant property, and are immediately condemned and forfeited to the United States pursuant to paragraph 8. To the extent any portion of the Settlement Amount is not timely paid in accordance with the payment schedule and paragraph 9 below is triggered, any prior payment(s) made is condemned and forfeited as part of the substitute res for the defendant property pursuant to paragraph 8, and the unpaid balance of the Settlement Amount shall be paid and forfeited to the United States in the manner set forth in paragraphs 8-9;

b. Within 3 business days of timely receipt of the full Settlement Amount, an authorized agent of the United States will execute a notarized withdrawal of the Lis Pendens on the defendant property and will promptly deliver the executed document to undersigned counsel for claimants;

c. Hawthorne Real Estate, LLC, f/k/a Lawndale Carwash LLC, and Benny Pirian agree that until the full Settlement Amount is paid (or, if paragraph 9 is triggered, until the property is sold), they will not take any action to affect the marketability of the defendant property.

8. Upon the payment of all or part of the Settlement Amount, all right, title, and interest in the Settlement Amount (or portion thereof) of Hawthorne Real Estate, LLC, f/k/a Lawndale Carwash LLC, Benny Pirian, and all other potential claimants is hereby condemned and forfeited to the United States without further order of this Court, and the United States shall have judgment as to the interests of these persons in the Settlement Amount. The Internal Revenue Service-Criminal Investigation ("IRS-CI") shall dispose of the Settlement Amount in accordance with law.

9. If Hawthorne Real Estate, LLC, f/k/a Lawndale Carwash LLC, and Benny Pirian fail to timely pay the Settlement Amount in full as specified in paragraphs 5-6, this paragraph 9 shall apply:

a. The United States shall be entitled, in its sole discretion and without the need for further court order, to take possession of and undertake to sell the property described in Exhibit A to the parties' stipulation in a commercially reasonable manner in order to recover the unpaid balance of the Settlement Amount.

b. Upon the sale of the property, the proceeds are to be distributed as follows:

i. First, for payment of all costs of sale (including, but not limited to, real estate commissions and appraisals);

ii. Second, for payment to the tax assessor's office and tax collector for the County of Los Angeles for any real property taxes due and owing on the defendant property as of the date of sale;

iii. Third, for payment to Union Pacific Bank in accordance with the terms of the deed of trust in favor of Mirae Bank described in paragraph 4 above;

iv. Fourth, for payment to the United States of the unpaid balance of the Settlement Amount. All right, title, and interest of Hawthorne Real Estate, LLC, f/k/a Lawndale Carwash LLC, Benny Pirian, and all other potential claimants in funds paid pursuant to this sub-paragraph is hereby condemned and forfeited to the United States without further order of the Court. The IRS-CI shall dispose of such funds in accordance with law; and v. Fifth, the remaining sales proceeds, if any, shall be paid via check payable to "Bird Marella Boxer Wolpert Nessim Drooks & Lincenberg" and shall be delivered to undersigned counsel for claimants within 5 days of the close of escrow.

c. In the event this paragraph 9 is triggered, the IRS-CI, or its authorized agents, is hereby empowered without the need for further court order to terminate all leases affecting the defendant property, to enter and take possession of the defendant property by whatever reasonable means are at its disposal, and evict all occupants and remove their personal property. Hawthorne Real Estate, LLC, f/k/a Lawndale Carwash LLC and Benny Pirian shall cooperate with all requests of agencies of the United States and representatives contracted by the United States for access to the defendant property in connection with a sale pursuant to this paragraph 9.

10. Except as to such rights and obligations created by the parties' stipulation, Hawthorne Real Estate, LLC, f/k/a Lawndale Carwash LLC and Benny Pirian release and hold harmless the United States, and any agents, servants, and employees of the United States (or any state or local law enforcement agency) acting in their individual or official capacities, from all claims, actions or proceedings by them and their agents, including, but not limited to, any claim for attorney's fees and/or costs, or interest, which may hereafter be asserted or brought by or on behalf of either of them which arise out of the present action.

11. Except as to such rights and obligations created by the parties' stipulation, and as to any civil tax liabilities or criminal matters, the United States releases and holds harmless Hawthorne Real Estate, LLC, f/k/a Lawndale Carwash LLC and Benny Pirian from all claims, actions or proceedings against the defendant property on the grounds alleged in the complaint, including, but not limited to, any claim for attorney's fees and/or costs, or interest, which may hereafter be asserted or brought by or on behalf of the United States.

12. Each party shall bear its own costs of litigation and attorney's fees. Each party waives its right to appeal the consent judgment. Entry of this Consent Judgment constitutes a certificate of reasonable cause pursuant to 28 U.S.C. § 2465(a)(2).

13. The Court retains jurisdiction over this case and the parties hereto to effectuate the terms of the parties' stipulation and this consent judgment.

14. There being no just cause for delay, the clerk is hereby directed to enter this consent judgment, which constitutes a final judgment resolving this action.

IT IS SO ORDERED.

20090727

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