WCP Fund I Sued For Alleged “Fraudulent Inducement” and “Negligent Misrepresentation”
February 14, 2022, District of Maryland – Plaintiff-Debtor 1604 Isherwood, LLC, and its managing member Zaid Alli initiates a lawsuit against Defendants WCP Fund I, LLC and 1 Sharpe Opportunity Intermediate Trust for alleged “fraudulent inducement” and “negligent misrepresentation.” The Plaintiffs request the Court to disallow the Defendant’s proof of claim, rescind the alleged transaction, and avoid any security interest created under the alleged transaction in the Debtor’s property.
The issue as contended in the complaint revolves around a real property identified as 1604 Isherwood St. Washington, D.C. 20002, that Zaid Alli had allegedly purchased. The complaint asserts that Zaid Alli sought a mortgage loan from WCP to refinance his property. The complaint further contends that WCP “induced” Zaid Alli to form the Debtor Isherwood, LLC to create a commercial loan transaction, “even when Zaid Ali had explained to WCP that he intended the property to be his principal dwelling.” Ziad Ali further argues that under this alleged commercial loan transaction, Isherwood allegedly owed a debt of $525,000.00 at 7.99% interest to Defendant WCP Fund. The complaint also contends that Defendant”withheld” $52,550.91 in escrow from the loan proceeds to pay the interest payments through March 31, 2021.
Through its complaint, Isherwood seeks to disallow the proof of claim filed by WCP and requests the Court to enter an order granting rescission of the alleged transaction, including a declaration that Isherwood is “not liable for any finance charges or other charges imposed by WCP.” The Plaintiffs also seek a declaration that any security interest in Plaintiff’s property created under the alleged transaction “is void” and urges the Court to enter an order requiring WCP to release such security interest. In addition, Plaintiff urges the Court to grant an order directing WCP to return any money or property given by the Plaintiffs in connection with the alleged transaction and award actual damages as established at trial.
IN RE: 1604 Isherwood, LLC, Case No. 21-00277 ELG