Areas Bank v.Kaplan. Instances citing this case

III. MIKA’s liability for MKI’s financial obligation

Trying to subject MIKA to obligation for MKI’s financial obligation, Regions claims “de facto merger,” “mere continuation,” and “fraud” under Florida legislation. These comparable and sporadically overlapping claims ask in place whether an innovative new firm replaced an adult, debt-laden company. See, e.g., Lab Corp. of Am. v. Prof’l healing system, 813 therefore. 2d 266, 270 (Fla. fifth DCA). Success on any one of these three claims entitles areas to get from MIKA the $1,505,145.93 judgment joined for areas and against MKI action.

Many times when you look at the test, Marvin’s testimony advised a flouting of, or neglect for, the business kind. Describing the motion of cash from 1 corporation he was able to another business he managed, Marvin claimed: “You make the funds in one entity and also you place it where you want it to get, either if it is from your own individual account to your LLCs or even the LLCs to your account that is personal. (Tr. Trans. at 339) Marvin states within the next breathing that he “trues up at the conclusion associated with entire year,” nevertheless the documentary evidence belies the contention that Marvin “trued up” following the transfers to Kathryn and MIKA.

A. De facto merger

The Florida choices seem to need dissolution of this corporation that is first in the event that business not any longer runs. For instance, Amjad Munim, M.D., P.A. v. Azar, 648 therefore. 2d 145, 153-54 (Fla. 4th DCA), seems to reject a de merger that is facto because “the technical dependence on dissolution associated with predecessor firm had not been founded,” also although the evidence advised that the very first firm “essentially ceased operations.” Although inactive, MKI continues to be in presence, which under Florida legislation defeats the de facto merger claim.

B. Mere continuation

If an organization just continues another organization’s company under a name that is different with similar ownership, assets, and workers (among other products), Florida law subjects the successor business to obligation for the previous business’s financial obligation. See, e.g., Centimark Corp. v. A to Z Coatings & Sons, Inc., 288 Fed.Appx. 610 (applying Florida law and collecting decisions). In this situation, Regions proved by (at minimum) a preponderance that MIKA just proceeded MKI’s company under a guise that is new. Marvin managed the 2 organizations, which both operate from Marvin’s individual workplace and transact the business that is same. (Doc. 162 at 36) As explained somewhere else in this purchase, MIKA received and deployed MKI’s assets, and Marvin owned both ongoing businesses through the IRA. The provided assets, workplace, administration, and ownership confirm areas’ claim that MIKA amounts up to a “mere extension” of MKI under a various title.

Finally, Regions requests a statement that MIKA is nothing but an effort that is”fraudulent by MKI to hinder areas’ tries to fulfill the judgment action. In line with the testimony plus the proof talked about somewhere else in this purchase, areas proved that MIKA more likely than perhaps perhaps not quantities up to an attempt that is fraudulent preclude areas’ gathering regarding the MKI judgment.

IV. Injunction

The Kaplan parties’ conduct displays a protracted pattern of evasion that demonstrates the necessity for an injunction under Section 726.108(c)(1) against another disposition by MKI or MIKA of an interest in 785 Holdings as explained throughout this order. MK Investing and MIK Advanta, LLC, should never move a pastime in 785 Holdings, LLC.

If Kathryn, MKI, MIKA, or even a Kaplan entity fraudulently transfers cash to a 3rd party, areas can acquire a cash judgment up against the transferee, a appropriate treatment that forecloses the equitable treatment of a injunction. (Doc. 113 at 6)


At test, Marvin blamed their accountant, their attorneys, along with his IRA custodian for supposedly paperwork that is erroneous largely supports areas’ claims. From time to time, Marvin faulted Advanta when it comes to presumably inaccurate papers and stated that Advanta forced Marvin to generate MIKA and that Advanta created from entire cloth the valuations that Marvin verified, frequently under penalty of perjury. Predicated on Marvin’s perplexing, implausible, and testimony that is often contradictory in line with the contemporaneous documents, that have been authorized whenever Kaplan events encountered no possibility of a detrimental judgment for the fraudulent transfer and which mainly refute the Kaplans’ assertions, we reject the Kaplan parties’ defenses and conclude that Regions proved the fraudulent-transfer claims (excepting the claim on the basis of the IRA’s transfer to MIKA regarding the $214,711.30 and excepting the de merger that is facto in count fourteen).

The record reveals no reason to subject Marvin to liability for the Kaplan entities’ transfers or for MKI’s transfers to MIKA although Regions names Marvin as a defendant. Areas won a judgment action against MKI in addition to Kaplan entities, maybe perhaps not against Marvin. Areas mentions purchase doubting the Kaplan events’ movement to dismiss, which purchase observes that the “predominant fat of authority holds that a plaintiff can sue the beneficiary of the self-directed IRA when it comes to IRA’s so-called wrongdoing as the self-directed IRA is certainly not a different legal entity from its owner.” (Doc. 79 at 3 (interior quote omitted)) Although proper, the observation does not have application in this step because areas’ concession in footnote thirteen forecloses a fraudulent-transfer claim on the basis of the IRA’s transfer of cash to MIKA. The IRA owned devices of MKI and MIKA, but an IRA’s ownership of a LLC provides no foundation for subjecting the IRA beneficiary to liability for a transfer that is fraudulent or through the LLC. ——–

The clerk is directed to enter individually the following judgments:

(1) Judgment for areas Bank and against Kathryn Kaplan when you look at the level of $742,543.

(2) Judgment for areas Bank and against MIK Advanta, LLC, into the number of $1,505,145.93.

The clerk must close the case after entering judgment.

BOUGHT in Tampa, Florida.