Shady Accusations Prove Transfers are Fraudulent But are Insufficient to Deny Summary Judgment to Defendant – Los Angeles Income Tax Planning and Asset Protection Plan Attorney Bruce Givner

by Bruce Givner on April 9, 2013

Kremen sued Stephen Cohn for stealing Kremen’s web domain, Kremen won $65 million.

Kremen then sued Stephen’s cousin, Michael Cohen, for fraudulent transfers received from Stephen Cohen, after Stephen ran to Mexico to avoid paying the balance of Kremen’s $65 million judgment. Kremen has now lost.

According to the Northern District Court of California, Kremen produced evidence sufficient to prove it was likely transfers from Stephen to Michael were fraudulent and Kremen would suffer imminent harm without a summary judgment. Specifically, Kremen’s evidence showed:

1. Stephen used family members to hide his assets; and

2. Michael’s PayPal account showed a series of transactions with two Mexican companies. One company was formed by Michael, while the other was formed by Stephen, with the latter company solely owning the former.

However, because Kremen did not produce any evidence to show that Stephen actually transferred any non-business or a substantial amount of assets to Michael, or that the Mexican companies were Stephen’s alter egos, summary judgment was granted to Michael Cohen.

This case shows the difficulties that sometimes occur in a fraudulent transfer action that involves foreign transactions and entities. Kremen v. Cohen, 2013 WL 61194 (N.D.Cal., Jan 2, 2013).

Givner & Kaye focuses on sophisticated income tax planning and compliance, tax litigation and procedure, estate planning, and asset protection plans for individuals and businesses in Beverly Hills, Calabasas, West Los Angeles, Hollywood, and other areas of Los Angeles, Orange, Ventura, San Bernardino, Riverside and Santa Barbara Counties. Call Los Angeles Estate Planning and Asset Protection Plan Attorneys Givner & Kaye at (310) 207-8008 today.

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