United States District Court, D. Nevada
ORDER GRANTING IN PART PLAINTIFFS' APPLICATION
FOR ENTRY OF DEFAULT JUDGMENT (ECF NO. 27)
P. GORDON UNITED STATES DISTRICT JUDGE.
EZRA ILANI and CATHY ILANI Gointly "Plaintiffs")
filed an Application for Default Judgment against defendants
SIMON S. ABRAHAM; KDA HOLDINGS, LLC; KING SOLOMONS TREASURES,
LLC; 777 HOLDINGS INTERNATIONAL LTD., LLC; AMASIAN GEM
CORPORATION OF NEVADA; LE SIMONE JEWELRY LTD.; and KING
DAVIDS RIVER OF GOLD LLC (collectively
"Defendants"). ECF No. 27. Defaults were previously
entered against those Defendants. The plaintiffs have
demonstrated that those Defendants are not in the military
service of the United States and are not infants or
considered the evidence and argument in Plaintiffs'
Application for Default Judgment, and good cause appears to
grant the Application in part. Plaintiffs have not offered
sufficient evidence to support entry of judgment on all of
their claims against all of those Defendants. But I will
grant the Application with regard to some of the claims
against some of the Defendants.
FINDINGS OF FACT
Defendant Simon Abraham is a managing member of defendant
KDA. ECF No. 1 at ¶ 17. Abraham and KDA are merchants in
the jewelry industry. Id. at ¶ 23.
Plaintiffs and KDA entered into a contract for a
collateralized loan on May 13, 2016 (the
"Agreement"). ECF No. 27-2.
Under the terms of the Agreement, Plaintiffs provided a loan
in the amount of $2, 000, 000 (the "Loan") payable
upon execution of the Agreement.
Under the terms of the Agreement and as consideration for
making the Loan, KDA was to pay fees in the amount of $500,
000 (the "Loan Fees") payable upon maturity.
was required to repay the Loan on or before 60 days from the
receipt of the Loan proceeds in addition to paying the Loan
security for the Loan, KDA pledged a set of seven red
corundum gemstones which were appraised at $3, 610, 800 by
co-Defendant Joel Lackey (the "Collateral").
Adrian Cazares ("Cazares") was named the
third-party liaison in the Agreement. ECF No. 27-2. His
responsibilities were to ensure the Collateral remained in
the proper chain of custody for the duration of the
After the Collateral was appraised by Lackey, it was
deposited in a safe deposit box at Bank of Nevada.
Under the terms of the Agreement, the ownership rights to the
Collateral were to transfer from KDA to the Plaintiffs in the
event of a default. If KDA defaulted on its obligation, then
Cazares was required to tender the safe deposit box keys and
safe deposit box receipt within 10 days of receipt of a
Notice of Intent to Take Possession.
Plaintiffs performed under the Agreement by wiring $2, 000,
000 to Abraham's account on May 18, 2016.
defaulted on its obligation on June 17, 2016. The default
transferred ownership of the Collateral to Plaintiffs.
Plaintiffs provided KDA and Abraham with the requisite 10
days' Notice of Intent to Take Possession of the
Collateral on November 18, 2016.
Plaintiffs took possession of the Collateral on January 9,
or about January 16, 2017, an independent gemologist (Steve
Rubinstein of New York Jewelers in Chicago, Illinois)
verified authenticity of the Collateral and advised
Plaintiffs to obtain an official appraisal.
Thomas Tashey, Jr. of Professional Gem Sciences Laboratory
appraised the Collateral. He estimated the value of the
Collateral as between twenty-five and thirty-five dollars per
carat ($25-$35/carat), resulting in a total value, at retail,
of approximately $15, 000.
and Abraham knew or should have known the true value of the
Collateral pledged under the Agreement. Defendants'
material misrepresentation is evidence of fraudulent conduct.
Defendants have failed to respond to Plaintiffs'
Complaint. A default was entered against the ...