Torres v. Zamanizadeh et al

Filing 23

Opinion and Order Granting Preliminary Injunction. Signed on 2/6/2018 by Judge Michael H. Simon. (mja)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF OREGON

ANGELA TORRES,
Plaintiff,

Case No. 3:17-cv-1270-AC

OPINION AND ORDER GRANTING
PRELIMINARY INJUNCTION

v.

ALIREZA ZAMANIZADEH, a/k/a ALI
ZAMANI, an individual, and ADULT CARE
SEARCH, a foreign non-profit corporation,
Defendants.

Michael H. Simon, District Judge.
On January 10, 2018, the Court entered a temporary restraining order restraining
Defendants from any and all activity resulting in the expenditure, encumbrance, or other
disposition of funds or real property that may be traced back to Plaintiff. The Court ordered
Defendants to appear and show cause why the Court should not issue a preliminary injunction.
The Court held a hearing on January 19, 2018, and at the request of the parties extended the
temporary restraining order and rescheduled the hearing for February 2, 2018. A few days before
the hearing on February 2, 2018, counsel for Defendants withdrew. Defendant Alireza
Zamanizadeh ("Zarnani") appeared pro se at the February 2, 2018 hearing.

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After considering the record and the arguments and assertions made at the hearing, the
Court grants Plaintiffs motion for a preliminary injunction.

STANDARDS
A preliminary injunction is an "extraordinary remedy that may only be awarded upon a
clear showing that the plaintiff is entitled to such relief." Winter v. Nat. Res. Defense Council,

Inc., 555 U.S. 7, 22 (2008). A plaintiff seeking a preliminary injunction generally must show
that: (1) he or she is likely to succeed on the merits; (2) he or she is likely to suffer irreparable
harm in the absence of preliminary relief; (3) the balance of equities tips in his or her favor; and
(4) that an injunction is in the public interest. Id at 20 (rejecting the Ninth Circuit's earlier rule
that the mere "possibility" of irreparable harm, as opposed to its likelihood, was sufficient, in
some circumstances, to justify a preliminary injunction).
The Supreme Court's decision in Winter, however, did not disturb the Ninth Circuit's
alternative "serious questions" test. All. for the Wild Rockies v. Cottrell, 632 F.3d 1127, 1131-32
(9th Cir. 2011). Under this test, '"serious questions going to the merits' and a hardship balance
that tips sharply toward the plaintiff can support issuance of an injunction, assuming the other
two elements of the Winter test are also met." Id at 1132. Thus, a preliminary injunction may be
granted "ifthere is a likelihood of irreparable injury to plaintiff; there are serious questions going
to the merits; the balance of hardships tips sharply in favor of the plaintiff; and the injunction is
in the public interest." MR. v. Dreyfus, 697 F.3d 706, 725 (9th Cir. 2012).

BACKGROUND
Plaintiff filed this case on February 21, 2017, in Clark County Superior Court in the State
of Washington, alleging state court claims for fraud and unjust emichment. Defendants removed
the case to this Court on August 15, 2017. Plaintiff alleges that Zamani fraudulently induced
Plaintiff to temporarily transfer money and one piece of real property to a charitable organization
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owned by Zamani-Defendant Adult Care Search ("ACS")-and to sign a power of attorney
authorizing Zamani to engage in real estate transactions on Plaintiffs behalf. Plaintiff further
alleges that Zamani then refused to return those monetary and real propery assets.
In support of her motion for a temporary restraining order and preliminary injunction,
Plaintiff submitted her declaration, the declaration of a state investigator, and the declaration of
her counsel. Plaintiffs declaration attests to the following facts: (1) Zamani used his personal
relationship with Plaintiff to induce her to transfer to ACS money and assets and to sign a power
of attorney granting Zamani authority over real estate transactions; (2) in June 2016 Plaintiff
transferred $290,000 from her retirement account to ACS and transferred her Washington
residence via quitclaim deed to ACS; (3) Plaintiff never intended to permanently donate those
assets to ACS or to give them to Zamani; (4) Zamani convinced Plaintiff to transfer those assets
to Zamani temporarily to shield them during Plaintiffs divorce proceedings and Zamani
promised he would return them to Plaintiff; (5) Plaintiff nonetheless reported the assets during
her divorce proceedings; (6) Zamani represented to Plaintiff that he has foreign bank accounts
and assets and companies abroad; (7) Plaintiff repeatedly requested the return of her real
property and money and Zamani would indicate his willingness to meet and do so and then not
show up or otherwise stall; (8) Zamani finally stated that the money and real property was a
"donation" to ACS and sent a donation receipt in February 2017, nearly eight months after the
purported donation; (9) Plaintiff was awarded a piece of real property in Bend, Oregon as part of
her divorce and in November 2016 Zamani asked her for the address of the property purportedly
so he could ensure that there were no liens on the property; (10) on February 15, 2017, Zamani
used the power of attorney he had obtained from Plaintiff to transfer the Bend, Oregon property
to ACS and then obtained a $300,000 cash-out mortgage on the property; and (11) Plaintiff was

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unaware of the transfer of the Bend, Oregon property and subsequent mortgage and did not learn
about it until an investigation was conducted by the State of Oregon into ACS. Plaintiff attached
numerous exhibits, including text messages and emails between her and Zamani, the power of
attorney, the quit claim deeds, the money transfers, and the Trust Deed for the mortgage on the
Bend property, supporting Plaintiffs factual assertions.
The declaration of Frank M. Najar, an investigator with the Oregon Department of
Justice's Charitable Activities Section, states that: (1) he investigated ACS and concluded that
ACS does not perform any charitable activities; (2) 86 percent of ACS's funds deposited
between February 2014 and February 2017 came from Plaintiff; (3) the money taken from
Plaintiff was used for Zamani's personal benefit and not for any charitable purpose; (4) he noted
the $300,329.12 deposit into ACS's account and when asked for documentation relating to the
deposit discovered the fact that it was from a cash-out mortgage on Plaintiffs Bend, Oregon
property; (5) of the $590,329.12 taken from Plaintiff and deposited into ACS 's bank account,
Zamani withdrew at least approximately $142,000 in cash, without explanation for how that cash
was spent; and (6) of the $590,329.12 taken from Plaintiff and deposited into ACS's bank
account, Zamani transferred at least approximately $338,700 from the ACS bank account and
into the bank account ofZamani's for-profit company, ACareOption.com, whereas Zamani
transferred only approximately $56,000 back from ACareoption.com to ACS.
Finally, Plaintiff's counsel represented to the Court in his declaration that he filed the
motion for temporary restraining order ex parte because he is concerned that if notice were given
Zamani would likely attempt to move, withdraw, spend, encumber, or dispose of Plaintiffs
remaining cash and real estate assets under Defendant Zamani's ownership or control, or under
ownership or control of Defendant ACS or Defendant Zamani's ACareOption.com, Inc.

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Plaintiffs counsel noted that Zamani has demonstrated his disregard for courts by encouraging
Plaintiff to shelter her assets in her divorce, still has Plaintiff's power of attorney in his
possession, and has demonstrated that he will dispose of Plaintiffs assets improperly by
transferring title to Plaintiff's Bend property and taking a cash-out mortgage without Plaintiffs
knowledge. Counsel fmther pointed out that Zamani has stated that ACS owns the assets and can
do with them whatever it wants and has represented that he has bank accounts and assets in
foreign countries, making it a viable risk that he can transfer Plaintiffs assets outside the
country. Based on this evidence, the Court entered a temporary restraining order.
Although Defendants did not file any response to the Court's order to show cause or
before the preliminary injunction hearing, at the hearing Zamani provided some factual
background from his perspective. Zamani claims that Plaintiff is making false allegations against
Defendants after Zamani rejected Plaintiffs desire for a continued personal relationship. Zamani
asserts that Plaintiff donated funds to Zamani's charity without his knowledge and of Plaintiffs
own volition. Zamani also states that when he traveled to Iran he encountered difficulties with
the Iranian government as a result of Plaintiffs communications with Zamani, and that because
of those problems he was required to pay hundreds of thousands of dollars to the Iranian
government. Zamani contends that when he told Plaintiff this, she offered some of her assets to
help Zamani make the payment. Zamani fmther states that his relevant bank accounts only have
approximately $35,000.
DISCUSSION
A. Winter Factors
1. Likelihood of Success on the Merits

The Court finds that Plaintiff has shown a likelihood of success on the merits of her fraud
and unjust enrichment claims. Plaintiff transferred $290,000 of her retirement funds to ACS in
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two transactions, one on June 13, 2016 and one on June 22, 2016. Plaintiff executed a quitclaim
deed transferring her Washington property to ACS on June 14, 2016.
Plaintiff claims that these transfers were intended to be temporary and that Zamani
promised to return the money and property to Plaintiff. Plaintiff claims that she relied on
Zamani' s representations that the assets would be returned in transferring them and in signing the
power of attorney. Zamani asserts that Plaintiff transferred the monies without his knowledge
and that they were intended to be charitable donations at the time made. The text messages
submitted by Plaintiff, however, support Plaintiffs assertions. When Plaintiff makes requests to
Zamani regarding the return of her money and property, Zamani responds regarding setting
meeting times or times to speak on the telephone, or chastising Plaintiff for putting such
information in writing. Zamani does not respond that Plaintiff is incorrect in her assumption that
the transfers were temporary and were, instead, actually permanent donations to ACS. The latter
response would be expected if Zamani had not made representations that the assets would be
returned and instead had believed the transfers to be charitable donations. Further, ACS did not
send a charitable donation receipt to Plaintiff until February 2017, when Plaintiff became more
forceful in her demands for the return of the assets and the relationship between the parties
deteriorated. If Zamani and ACS believed Plaintiffs June 2016 transfers were considered
charitable donations at the time made, it is expected that a donation receipt would have been
issued at that time.
Moreover, the investigation by the State of Oregon supports Plaintiffs claims. The State
concluded that ACS is not a genuine charity, that 86 percent of all its revenues from
February 2014 through February 2017 was the approximately $590,000 that came from
Plaintiffs assets, and that more than $425,000 of those funds was used by Zamani for his

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personal gain. This supports that Zamani did not genuinely believe that the transfers from
Plaintiff were contributions to a charity, to be used for charitable purposes.
Plaintiff also testifies in her declaration that Zamani told her she had to sign a power of
attorney in order to quitclaim Plaintiffs Washington property to ACS. This statement was false,
and the Court finds that Plaintiff has shown a likelihood of success that Zamani !mew it was false
at the time it was made. This supports Plaintiff's fraud claim. In his text messages Zamani
repeatedly represents his expertise in financial and real estate matters. It is a reasonable inference
that he would know that Plaintiff could quitclaim the property without signing a power of
attorney to Zamani, particularly because Zamani did not sign the quitclaim deed and thus the
power of attorney was inelevant to that transaction. The power of attorney was only relevant if
Zamani intended to conduct other real estate transactions in Plaintiffs name, which he later did
with respect to Plaintiffs Bend, Oregon property .1

2. Irreparable Harm
The Court finds a likelihood of ineparable hmm if a preliminary injunction is not issued.
The State of Oregon has concluded that Zamani has created a chm·itable organization that has not
been used for charitable purposes but instead has been used for Zamani's personal gain, and that
Zmnani used this charitable organization to take Plaintiffs money and use it for Zmnani' s
personal purposes. Approximately $30,000 remains in the purported charity's account. If the
money is not frozen, it will likely be dissipated. Moreover, Zamani testified that only
approximately $35,000 of Plaintiffs approximately $590,000 remains in the combined bank

1

At this time, Plaintiff has not amended her complaint to add any allegations relating to
the Bend, Oregon prope1ty and so the Court does not consider the likelihood of success on any
claim related to Defendants' alleged conduct relating to this prope1ty.
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accounts of Zamani's business and purported charity. Thus, ifthe Court does not freeze these
funds it is very likely the final $35,000 will be dissipated before this litigation is finalized.
The Court also finds a likelihood of irreparable harm relating to Plaintiff's real property.
Zamani has already used Plaintiffs power of attorney to transfer one parcel of real property out
of Plaintiffs name and into the name of Zamani's charity, and then taken an approximately
$300,000 cash-out mortgage on that property. Zamani still has Plaintiff's power of attorney for
real estate transactions in Zamani' s possession.
There is also evidence that in addition to running a fraudulent charity, Zamani has
strategized how to shelter assets from court proceedings, has international bank accounts and
assets, has dual citizenship in the United States and Iran, and has dissipated more than $425,000
of Plaintiffs assets to date. Although Plaintiff did not move for an injunction immediately upon
filing her lawsuit, and delay is a factor in considering irreparable harm, at that time Plaintiff was
unaware that Zamani had transferred Plaintiffs Bend, Oregon property to ACS and took the
cash-out mortgage. It is not clear when Plaintiff became aware of this fact, but it was discovered
by the Oregon investigator sometime after he interviewed Zamani on July 27, 2017. Thus, the
Court does not find that Plaintiff engaged in an unreasonable delay precluding a finding of
irreparable harm.

3. Balancing the Equities
In weighing equities, a court "must balance the competing claims of injury and must
consider the effect on each party of the granting or withholding of the requested relief."

Winter, 555 U.S. at 24 (citation omitted). Granting the injunction would freeze Plaintiffs
remaining assets in the possession of Defendants. The injunction also freezes the bank account of
ACS, which consists primarily of Plaintiffs assets, and two accounts of ACareOption.com, Inc.,

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in which the state of Oregon investigation found a significant amount of Plaintiffs funds were
transferred.
The potential harm to Plaintiff in not issuing an injunction has been discussed above.
Granting the injunction may harm Defendants because they would not have access to Plaintiffs
remaining assets in their possession or control. The Court finds that this potential for harm is
negligible, however, because Plaintiff has a likelihood of success in proving that her assets were
never intended to go to Defendants on a permanent basis. Fu1iher, if she fails to so prove, then
Defendants will have access to her assets when this case ends.
The injunction may hmm ACS because its bank account will be frozen. This is harmful,
but the harm is tempered by the State of Oregon's findings that ACS is a fraudulent charity, does
not perfo1m any charitable activities, and its funds have only been used for Zamani's personal
use. Moreover, because only approximately $30,000 remains in ACS's account, compared to the
more than $590,000 taken from Plaintiff, the harm is imbalanced.
The injunction may also harm ACareOption.com, because one of its accounts would be
frozen. 2 A significant amount of Plaintiffs funds, however, were transferred into
ACareOption.com bank accounts. Moreover, Zamani testified that there is only $5,000 in the
account of ACareoption.com. Thus, the potential harm to ACareOption.com does not outweigh
the potential harm to Plaintiff.
In considering the specific dollar amounts at issue and for the same reasons discussed in
the cou1i's opinion granting the temporary restraining order, the Court finds that the potential
harm to Defendants and ACareOption.com, on balance, is outweighed by the likely hmm to
Plaintiff if an injunction is not issued. As discussed above, Zamani used Plaintiffs power of

2

Zamani testified that the second account has been closed.

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attorney after the parties' relationship deteriorated, without Plaintiffs knowledge, to transfer
ownership of Plaintiffs Bend property and take a cash-out mortgage. Plaintiff is possibly facing
losing her real property. Zamani has also used his for-profit corporation ACareOption.com to
take money from his purported charity and has taken significant cash out of his purported
charity. Given Zamani's dissipation of Plaintiffs assets, strategization to avoid court
proceedings, and representations of his international bank accounts, assets, connections, and
citizenship, the potential hmm facing Plaintiff is significant. Cf Kyko Glob., Inc. v. Prithvi lrifo.
Sols., Ltd., 2013 WL 12173381, at *4 (W.D. Wash. June 19, 2013) ("A balancing of the
hardships weighs in favor of [Plaintiff] .... Prohibiting Defendants from transferring or
dissipating funds without Court approval-at least until they can be heard on the matter in the
next ten days-is not a burdensome condition given that Defendants were not wholly engaged in
a legitimate, lawful business. Thus, the risk weighs more heavily in favor of Plaintiffs.").
Moreover, if Defendants or ACareOption.com want access to the frozen assets they will
have the opportunity to post an appropriate bond. The injunction essentially preserves the status
quo and provides the oppmtunity for Plaintiff to have her assets returned if she prevails. The
Court has found that Plaintiff has a likelihood of success in proving that her assets were never
intended to be a donation to ACS, and certainly not intended to be given to ACareOption.com,
and thus freezing these accounts preserves Plaintiffs funds so that they cannot be further
dissipated.

4. Public Interest
When determining the public interest, a court "primarily addresses impact on non-parties
rather than parties." League of Wilderness Defs./Blue Mountains Biodiversity Project v.
Connaughton, 752 F.3d 755, 766 (9th Cir. 2014). Granting the injunction would not harm the
public interest. There is, however, public interest in preventing ongoing fraudulent behavior and
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dissipation of fraudulently-obtained funds. See Panyanouvong v. Aphay, 2014 WL 2986507,
at *6 (W.D. Wash. July 1, 2014) ("The public interest also favors the award ofa preliminary
injunction to prevent the perpetration of fraud against trnsting friends and members of the
expatriate Laotian community."); Kyko, 2013 WL 12173381, at *4 ("The Court also finds an
order preserving the status quo and preventing Defendants from transferring or dissipating funds
will advance the public interest. Defendants' alleged fraud involves falsely representing itself as
numerous multi-billion dollar companies and in-tum deceiving Plaintiffs. Preserving the status
quo until a more through vetting of Plaintiffs' claims can occur is, in this instance, in the interest
of the public." (citing Federal Sav. and Loan Corp. v. Ferm, 1989 WL 88415, *5 (9th Cir. 1989)
(finding evidence of fraud sufficient to show public interest in preventing further injury)); ST
Ventures, LLC v. KBA Assets & Acquisitions LLC, 2012 WL 3647656, at *3 (E.D. Cal. Aug. 23,

2012) ("Second, although the dispute in this case relates to a purely private transaction, the
public interest is promoted, at least in a general way, when alleged fraud or conversion is
thwarted.").

B. Bond
Federal Rule of Civil Procedure 65 instructs that "(t]he court may issue a preliminaty
injunction or a temporary restraining order only ifthe movant gives security in an ainount that
the court considers proper to pay the costs and dainages sustained by any party found to have
been wrongfully enjoined or restrained." Fed. R. Civ. P. 65(c). Federal courts, however, have
discretion as to the ainount of security and may even dispense with the security requirement
altogether. See Johnson v. Couturier, 572 F.3d 1067, 1086 (9th Cir. 2009) ("'Rule 65(c) invests
the district court with discretion as to the ainount of security required,

if any.' In particular,

"(t]he district court may dispense with the filing of a bond when it concludes there is no realistic
likelihood of harm to the defendant from enjoining his or her conduct."' (emphasis and alteration
PAGE 11 - OPINION AND ORDER GRANTING PRELIMINARY INJUNCTION

in original) (citation omitted) (quoting Jorgensen v. Cassiday, 320 F.3d 906, 919 (9th
Cir. 2003))); Save Our Sonoran, Inc. v. Flowers, 408 F.3d 1113, 1126 (9th Cir. 2005) ("'The
district court has discretion to dispense with the security requirement, or to request mere nominal
security, where requiring security would effectively deny access to judicial review."' (quoting
Cal. ex rel. Van De Kamp v. Tahoe Reg'! Planning Agency, 766 F.2d 1319, 1325 (9th

Cir. 1985))).
Plaintiff requests a nominal bond in the amount of $1, arguing that such a nominal bond
should be required because this case is about returning Plaintiffs assets that have been
wrongfully taken from her and there is no realistic likelihood of harm to Defendants. Given the
significant amount of Plaintiff's assets that she alleged was fraudulently taken from her by
Defendants and the Court's finding that Plaintiff has a likelihood of success on the merits, and
considering the relative hardships, the Comt concludes that to require any security in this case
would effectively deny Plaintiff access to judicial review and that there is no realistic likelihood
of harm to Defendants from enjoining their conduct. Accordingly, no bond shall be required.
C. Relief Granted
It is HEREBY ORDERED that:

1. Until further Order of the Court, the following Defendants, their assumed business names
and affiliates, are hereby restrained from spending, transferring, encumbering, or
otherwise disposing of funds or assets originating from Plaintiff or traceable to Plaintiff,
including derived from the real properties located at 779 W. Chestnut St., Washougal,
WA and 135 E. Telima Ln, Bend, OR, from any account owned or controlled by:
a. Defendant ALIREZA ZAMANIZADEH, a/k/a ALI ZAMANI;

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b. Defendant ADULT CARE SEARCH, an Oregon non-profit, or its assumed
business names Adult Care Association, US Seniors Association, and US Seniors
Foundation; and,
c. ACareOption.com, Inc., an Oregon for-profit corporation owned and controlled
by Defendant Zamani.
2. Chase Bank accounts ending in numbers *6923 (Adult Care Search), *2074 and *3236
(both ACareOption.com, Inc.) are restricted and frozen from any access, preventing any
withdrawals or transfers of funds until further notice of the Court;
3. Defendants may not sell, transfer, pledge, encumber, or otherwise dispose of the real
properties located at 779 W. Chestnut St., Washougal, WA and 135 E. Telima Ln, Bend,
OR.
4. Defendants may not take any action under any power of attorney related to Plaintiff.
5. Defendants may not access any funds, accounts, or assets owned or provided by Plaintiff.
6. Until further Order of the Comt, any documents or infonnation obtained during the
course of this proceeding, whether through party discovery or subpoena, that relate to
Plaintiff's assets shall not be disclosed to Defendants Zamani or ACS, but instead shall
be treated by Defendants' counsel as "attorney eyes only."
7. The retainer held by attorney Timothy J. Calderbank, Landerholm, P.S., 805 Broadway
Street, Suite 1000, Vancouver, WA 98666, up to $5,000, may be refunded to Defendants
and is not subject to this preliminary injunction.
8. Defendants may move to have this preliminary injunction modified, reconsidered, or
dissolved at any time.

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9. If Defendants Zamani or ACS request to unfreeze any of the listed accounts or others
related to each Defendant or ACareOption.com, Inc., Defendants shall arrange to deposit
with the Court $590,329.12, which equals the amount deposited in Defendant ACS's
account originating from Plaintiff, pending full resolution of this action.
IT IS SO ORDERED.

DATED AND SIGNED this 6th day of February, 2018.

~//~
~~~

United States District Judge

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