August 16, 2021, Central District of California – Plaintiffs and affiliated Chapter 11 Debtors in possession, Michael Levine, Inc. (“MLI”), and Laurence Alen Freidin, brings an adversary proceeding seeking civil contempt and injunctive relief against Defendants ARD Services, Inc., Connect Apparel, Inc. and Sohrab Issakharian to prevent further “violation of the automatic stay” and “irreparable harm” caused to the Debtors by Defendants “unlawful conduct”.

The complaint contends that the Defendants are allegedly wrongfully in possession of all of MLI’s inventory and a significant portion of MLI’s business operations, including books and records, electronic records, cash registers, intellectual property, computers, and prepetition and post-petition revenue, etc.

The Plaintiffs seek declaratory relief alleging that the Defendants “willfully violated” the automatic stay by “retaining possession and control” over property of MLI’s estate and by “refusing” to turn over the personal property and the proceeds derived therefrom under Sections 362(a)(1) and (3) of the Bankruptcy Code. The Plaintiffs also accuse Defendants of “fraud and deceit”, “negligent misrepresentation”, “conversion”, “intentional interference with prospective economic advantage”, and seek damages estimated to be no less than six million dollars ($6,000,000), injunctive relief along with avoidance and recovery of alleged preference transfers and turnover of property.

The case is In re Michael Levine, Inc. in the United States Bankruptcy Court for Central District of California being administered under case no. 2:21-ap-01169-ER.