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Boyajian v. Ordoubadi

May 20, 2010

MIKE BOYAJIAN, PLAINTIFF AND APPELLANT,
v.
SHAHROKH ORDOUBADI, DEFENDANT AND RESPONDENT.



Appeal from a judgment of the Superior Court of Orange County, Sheila Fell, Judge. Affirmed. (Super. Ct. No. 06CC08653).

The opinion of the court was delivered by: Sills, P. J.

CERTIFIED FOR PUBLICATION

OPINION

Because bankruptcy law allows for discharges of contingent claims, including claims against the debtor for indemnity before the time the indemnity claim against the debtor can be precisely measured, we affirm the trial court's judgment precluding the assertion of a prepetition claim for equitable indemnity against the debtor, the respondent and successful defendant at trial, Shahrokh Ordoubadi. The trial court correctly determined that the plaintiff's claim for equitable indemnity was discharged in a bankruptcy proceeding in 1994.

I. THE HISTORY

Like many mystery stories, legal cases often trace their true origins to sins of the past whose effects are visited on the present. This case is a compilation of three separate wrong decisions, the net effect of which would mean that plaintiff Michael (sometimes "Mike") Boyajian would have no claim for indemnity against the individual, Shahrokh Ordoubadi, who would turn out to be his coconspirator in a scheme to defraud a Dutch law firm.*fn1

A. Wrong Decision One: Trying to Defraud The Hague Tribunal

1. Plan A: Letters of Credit

In November 1979, an angry mob of young Islamic revolutionaries backed by the Iranian government overran the American embassy in Tehran, taking more than 60 Americans hostage. President Carter ordered a freeze on all Iranian funds. Ordoubadi, then an Iranian citizen living in the United States, wanted to get money out of Iran. So did Ordoubadi's stepbrother, Karl Showrai. But claims against the frozen funds could only be made by American citizens, and neither were American citizens at the time.

So Showrai, or Ordoubadi, or both, came up with this scheme: They invented Gordon Williams, and formed an Ohio irrigation equipment company called K & S Irrigation.*fn2 The irrigation company would sell equipment at inflated prices to Showrai's contracting company back in Iran known as Keyhan Corporation. The basic idea was to get money out of Iran. Showrai authorized Ordoubadi to take funds from Keyhan and deposit it in Iranian banks to obtain two letters of credit, each for $167,521.

But the scheme didn't work: Banks in the United States refused to honor the letters of credit in the wake of the freeze on all Iranian assets.

2. Plan B: A Formal Claim to the Hague

Ordoubadi went to plan B, which was essentially to make a claim to the Hague Tribunal based on the two dishonored letters of credit in the name of the nonexistent Gordon Williams. The Tribunal had been set up by the Algiers Accords to adjudicate disputes between United States nationals and the government of Iran. The major obstacle to the scheme was that, not being an American citizen at the time, he had no standing in his own right to present a claim to the Tribunal.

The fictitious Gordon Williams was, at least as he existed on paper, an American citizen. In 1982, a drivers license and an American birth certificate were dummied up for Williams, plus other documents, in what would later become "Claim 187" presented to the Hague Tribunal.

A front man, however, was needed. And that's where Mike Boyajian came in. Boyajian agreed to present the documents to a Dutch law firm known as Loeff & Van Der Ploeg, along with a $2,000 initial payment. The idea was that the Loeff firm would present Claim 187 to the Hague Tribunal.

Boyajian presented the documents in September 1982, when, ostensibly traveling on vacation, he met Leonard H. W. van Sandick of the Loeff firm. Sandick was pleased that Gordon Williams had a United States birth certificate. While Sandick had some early doubts about the Williams' claim, reassurances from Boyajian caused him to believe in its bona fides.

The Loeff firm took the case, and, to skip ahead to 1987, obtained an award in favor of Gordon Williams for exactly $167,521.*fn3

But again, the scheme didn't work. In 1988, Sandick discovered that Gordon Williams didn't exist. Sandick called his contact, Boyajian, and Boyajian confessed that Williams was, in fact, Ordoubadi.

The jig was up. Sandick informed the Tribunal of the falsity of the claim. The money, instead of going to Ordoubadi, ended up in the Federal Reserve Bank of New York, where, in litigation in the Southern District of New York, the federal court would determine that Showrai, posing as Williams, was not entitled to the money. (See Williams, supra, 708 F.Supp. 48.) Ordoubadi, also posing as Williams, was not a ...


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