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009589.0024\4780951.10 RECEIVER’S MOTION FOR ORDER: (1) 

AUTHORIZING SALE OF PERSONAL 

PROPERTY 

1 3:17-CV-00223-RS

Wendel, Rosen, Black & Dean LLP 

1111 Broadway, 24t h Floor 

Oakland, California 94607-4036 

Elizabeth Berke-Dreyfuss (Bar No. 114651) 

WENDEL, ROSEN, BLACK & DEAN LLP 

1111 Broadway, 24th Floor 

Oakland, California 94607-4036 

Telephone: (510) 834-6600 

Fax: (510) 834-1928 

Email: edreyfuss@wendel.com 

Attorneys for Susan L. Uecker, Receiver 

UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF CALIFORNIA 

SAN FRANCISCO DIVISION 

SECURITIES AND EXCHANGE 

COMMISSION, 

Plaintiff, 

vs. 

SAN FRANCISCO REGIONAL CENTER, LLC; 

THOMAS M. HENDERSON; CALIFORNIA 

GOLD MEDAL, L.P.; CALLSOCKET, L.P.; 

CALLSOCKET II, L.P.; CALLSOCKET III, 

L.P.; COMPREHENSIVE CARE OF 

OAKLAND, L.P.; NA3PL, L.P.; WEST 

OAKLAND PLAZA, L.P.; CALLSOCKET, 

LLC; CALLSOCKET II, LLC; CALLSOCKET 

III, LLC; COMPREHENSIVE CARE OF 

CALIFORNIA, LLC; IMMEDIA, LLC; and 

NORTH AMERICA 3PL, LLC, 

Defendants, 

-andCALLSOCKET HOLDING COMPANY, LLC; 

CALLSOCKET III HOLDING COMPANY, 

LLC; BERKELEY HEALTHCARE 

DYNAMICS, LLC; CENTRAL CALIFORNIA 

FARMS, LLC; and JL GATEWAY, LLC, 

Relief Defendants. 

 Case No. 3:17-CV-00223-RS 

RECEIVER’S MOTION FOR ORDER: (1) 

AUTHORIZING SALE OF PERSONAL 

PROPERTY OF CENTRAL CALIFORNIA 

FARMS, LLC; (2) APPROVING 

AGREEMENT WITH MID-VALLEY 

SERVICES, INC.; AND (3) 

AUTHORIZING RETENTION OF 

BROKER AND LISTING OF JL 

GATEWAY, LLC PROPERTY FOR SALE 

Date: September 28, 2017 

Time: 1:30 p.m. 

Place: 450 Golden Gate Ave. 

 17th Floor, Ctrm. 3 

 San Francisco, CA 94102 

Judge: The Hon. Richard Seeborg 

Case 3:17-cv-00223-RS Document 205 Filed 08/23/17 Page 1 of 15
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009589.0024\4780951.10 RECEIVER’S MOTION FOR ORDER: (1) 

AUTHORIZING SALE OF PERSONAL 

PROPERTY 

2 3:17-CV-00223-RS

Wendel, Rosen, Black & Dean LLP 

1111 Broadway, 24t h Floor 

Oakland, California 94607-4036 

TABLE OF CONTENTS 

Page 

I. INTRODUCTION ................................................................................................................. 5

II. LEGAL AUTHORITY ......................................................................................................... 5

A. District Court Power To Administer The Receivership. ........................................... 5

B. Deference To The Receiver’s Business Judgment. ................................................... 6

III. PROPOSED ACTIONS ........................................................................................................ 7

A. California Gold Medal, LLC and Central California Farms, LLC ............................ 7

1. Business Operations ...................................................................................... 8

2. Investor Status – I-526 Status and Risks for California Gold Medal, 

LLC Investors ................................................................................................ 9

3. Receiver’s Recommendation and Request ................................................... 9

a. Approval Of Agreement With M. Davis Group .............................. 10

b. Approval Of Agreement With Mid-Valley Services, Inc. .............. 11

B. West Oakland Plaza, L.P. And JL Gateway, LLC .................................................. 12

1. Business Operations .................................................................................... 12

2. Investor Status-I-526 Status And Risks for West Oakland Plaza, L.P. ....... 13

3. Receiver’s Recommendation and Request .................................................. 13

IV. CONCLUSION ................................................................................................................... 15

 

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009589.0024\4780951.10 RECEIVER’S MOTION FOR ORDER: (1) 

AUTHORIZING SALE OF PERSONAL 

PROPERTY 

3 3:17-CV-00223-RS

Wendel, Rosen, Black & Dean LLP 

1111 Broadway, 24t h Floor 

Oakland, California 94607-4036 

TABLE OF AUTHORITIES 

Page 

CASES

Bennett v. Williams

892 F.2d 822 (9th Cir. 1989) ................................................................................................. 6 

CFTC v. Tooworth Int’l., Ltd.

205 F.3d 1107 (9th Cir. 1999) ............................................................................................... 6

In re Thinking Machines Corp.

182 B.R. 365 (D. Mass. 1995) ............................................................................................... 6 

In re Thinking Machines Corp.

67 F.3d 1021 (1st Cir. 1995) ................................................................................................. 6 

SEC v. Basic Energy & Affiliated Resources

273 F.3d 657 (6th Cir. 2001) ................................................................................................. 6 

SEC v. Capital Consultants, LLC

397 F.3d 733 (9th Cir. 2005) ................................................................................................. 6 

SEC v. Elliot

953 F.2d 1560 (11th Cir. 1992) ............................................................................................. 6 

SEC v. Forex Asset Management, LLC

242 F.3d 325 (5th Cir. 2001) ................................................................................................. 6 

SEC v. Hardy

803 F.2d 1034 (9th Cir. 1986) ........................................................................................... 5, 6 

SEC v. Kirkland

2008 WL 4264532 (M.D. Fla. Sept 12, 2008) .................................................................... 11 

SEC v. Wang

944 F.2d 80 (2d Cir. 1991) .................................................................................................... 6 

Southwestern Media, Inc. v. Rau

708 F.2d 419 (9th Cir. 1983) ................................................................................................. 6 

STATUTES

28 U.S.C. 

§ 2001 ...................................................................................................................... 10, 11, 12 

§ 2001(b) ............................................................................................................................. 11 

§ 2004 ...................................................................................................................... 10, 11, 12 

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009589.0024\4780951.10 RECEIVER’S MOTION FOR ORDER: (1) 

AUTHORIZING SALE OF PERSONAL 

PROPERTY 

4 3:17-CV-00223-RS

Wendel, Rosen, Black & Dean LLP 

1111 Broadway, 24t h Floor 

Oakland, California 94607-4036 

Susan L. Uecker, the duly appointed receiver (the “Receiver”) for Defendants San 

Francisco Regional Center, LLC; California Gold Medal, L.P.; CallSocket, L.P.; CallSocket II, 

L.P.; CallSocket III L.P.; NA3PL, L.P.; West Oakland Plaza, L.P.; CallSocket, LLC; CallSocket 

II, LLC; CallSocket III, LLC; Immedia, LLC; Comprehensive Care of California, LLC; 

Comprehensive Care of Oakland, L.P.; and North America 3PL, LLC; and Relief Defendants 

CallSocket Holding Company, LLC; CallSocket III Holding Company, LLC; Central California 

Farms, LLC; JL Gateway, LLC; and Berkeley Healthcare Dynamics, LLC (collectively the 

“Receivership Entities”), will and does hereby move the above-captioned Court on September 28, 

2017, at 1:30 p.m. (or as soon thereafter as the Court may hear) for an order with respect to the 

Receiver’s Motion for Order: (1) Authorizing Sale of Personal Property of Central California 

Farms, LLC; (2) Approving Agreement with Mid-Valley Services, Inc., and (3) Authorizing 

Retention of Broker and Listing of JL Gateway, LLC Property for Sale (“Motion”). 

The Receiver seeks authorization to enter into an agreement to sell the remaining personal 

property located at a former dairy plant (“Tipton Plant”) the real property owned by Relief 

Defendant Central California Farms, LLC (“Central California Farms”), located at 417 and 615 N. 

Burnett Road, Tipton, California (“Tipton Property”) to the M. Davis Group for $25,000. 

In addition, the Receiver seeks authorization to enter into an agreement with Mid-Valley 

Services, Inc., with respect to the Tipton Property to provide that entity with a deed in lieu of 

foreclosure, because that property is worth less than the amount of the debt and defaulted taxes. 

Last, the Receiver seeks authorization to retain Colliers Parrish International, Inc., dba 

Colliers International as brokers for the listing, marketing and sale of the real property located at 

800-900 Market Street, Oakland, California, owned by Relief Defendant, JL Gateway, LLC. 

The Receiver’s Motion is brought pursuant to provisions of the Order Appointing Receiver 

and Monitor (“Appointment Order”), ¶¶ 35-38. (Docket No. 100) and the Court’s general 

equitable powers over equity receiverships and the Receiver’s business judgment. 

The Receiver’s Motion is supported by the following Memorandum and the declarations of 

Susan L. Uecker and Aileen Dolby and the exhibits and the proposed form of order granting this 

Motion attached hereto as Exhibit A, and the Request for Judicial Notice filed herewith. 

Case 3:17-cv-00223-RS Document 205 Filed 08/23/17 Page 4 of 15
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009589.0024\4780951.10 RECEIVER’S MOTION FOR ORDER: (1) 

AUTHORIZING SALE OF PERSONAL 

PROPERTY 

5 3:17-CV-00223-RS

Wendel, Rosen, Black & Dean LLP 

1111 Broadway, 24t h Floor 

Oakland, California 94607-4036 

MEMORANDUM IN SUPPORT OF MOTION 

I. INTRODUCTION 

This matter was initially brought before the court pursuant to a complaint filed on January 

17, 2017, by the Securities and Exchange Commission (the “SEC”), alleging that the named 

Defendants had exploited a federal EB-5 visa program by defrauding investors seeking to invest in 

the job creation program, earn a return on their investments and obtain a permanent U.S. visa as a 

way towards United States residency. (Docket No. 1). 

On January 20, 2017, the SEC filed a motion seeking, among other things, an order 

appointing a receiver over the entity Defendants and Relief Defendants. (Docket No. 10). 

Following oral argument, the court entered the Order Granting Motion for Preliminary 

Injunction and to Appoint a Receiver on March 23, 2017, pursuant to which the Court, among 

other things, appointed Susan L. Uecker as Receiver over most of the entities and Monitor over 

four entities. Thereafter, the Receiver was appointed receiver over the remaining four entities. 

(Docket Nos. 96, 100, 171). 

Pursuant to the provisions of the Appointment Order, on June 26, 2017, the Receiver filed 

her Recovery Plan. (Appointment Order, ¶ 49, Docket No. 185). That plan addressed crucial 

issues with respect to the Received Entities and whether investors have a realistic opportunity to 

secure their immigration benefits through the EB-5 program given that, as alleged in the SEC’s 

complaint, investor funds have been diverted and/or comingled, and the probability that San 

Francisco Regional Center, LLC (“SFRC”) will lose its regional center status from the USCIS. In 

bringing this Motion, the Receiver has relied on the recommendations made by her special 

immigration counsel with respect to the impact of the loss of the regional center status on the 

investors in the various entities as well her business judgment in determining the appropriate 

actions to be taken. 

II. LEGAL AUTHORITY 

A. District Court Power To Administer The Receivership.

A district court’s power to administer an equity receivership is extremely broad. SEC v. 

Hardy, 803 F.2d 1034, 1037 (9th Cir. 1986); SEC v. Forex Asset Management, LLC, 242 F.3d 

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009589.0024\4780951.10 RECEIVER’S MOTION FOR ORDER: (1) 

AUTHORIZING SALE OF PERSONAL 

PROPERTY 

6 3:17-CV-00223-RS

Wendel, Rosen, Black & Dean LLP 

1111 Broadway, 24t h Floor 

Oakland, California 94607-4036 

325, 331 (5th Cir. 2001); SEC v. Basic Energy & Affiliated Resources, 273 F.3d 657, 668 (6th Cir. 

2001); SEC v. Elliot, 953 F.2d 1560, 1566 (11th Cir. 1992); SEC v. Wang, 944 F.2d 80, 85 (2d Cir. 

1991). 

The “primary purpose of equity receiverships is to promote orderly and efficient 

administration of the estate by the district court for the benefit of creditors.” Hardy, 803 F.2d at 

1038. The Ninth Circuit has explained: 

A district court’s power to supervise an equity receivership and to 

determine the appropriate action to be taken in the administration of 

the receivership is extremely broad. The district court has broad 

powers and wide discretion to determine the appropriate relief in an 

equity receivership. The basis for this broad deference to the district 

court’s supervisory role in equity receiverships arises out of the fact 

that most receiverships involve multiple parties and complex 

transactions. 

SEC v. Capital Consultants, LLC, 397 F.3d 733, 738 (9th Cir. 2005) (citations omitted); see also, 

CFTC v. Tooworth Int’l., Ltd., 205 F.3d 1107, 1115 (9th Cir. 1999) (“This court affords ‘broad 

deference’ to the court’s supervisory role, and ‘we generally uphold reasonable procedures 

instituted by the district court that serve th[e] purpose’ of orderly and efficient administration of 

the receivership for the benefit of creditors.”). Accordingly, this court has broad equitable powers 

and discretion in formulating procedures, schedules and guidelines for administration of the estate, 

and should authorize the Receiver’s actions as proposed in her Motion. 

B. Deference To The Receiver’s Business Judgment. 

In the estate administration context, courts are deferential to the business judgment of 

bankruptcy trustees, receivers, and similar estate custodians. See, e.g., Bennett v. Williams, 892 

F.2d 822, 824 (9th Cir. 1989) (“[W]e are deferential to the business management decisions of a 

bankruptcy trustee.”); Southwestern Media, Inc. v. Rau, 708 F.2d 419, 425 (9th Cir. 1983) (“The 

decision concerning the form of [estate administration] rested with the business judgment of the 

trustee.”); In re Thinking Machines Corp., 182 B.R. 365, 368 (D. Mass. 1995) (“The application of 

the business judgment rule and the high degree of deference usually afforded purely economic 

decisions of trustees, makes court refusal unlikely.”) (rev’d on other grounds, In re Thinking 

Machines Corp., 67 F.3d 1021 (1st Cir. 1995)). 

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009589.0024\4780951.10 RECEIVER’S MOTION FOR ORDER: (1) 

AUTHORIZING SALE OF PERSONAL 

PROPERTY 

7 3:17-CV-00223-RS

Wendel, Rosen, Black & Dean LLP 

1111 Broadway, 24t h Floor 

Oakland, California 94607-4036 

The Receiver has determined, in her business judgment, as set forth in greater detail below 

that: 

• The Tipton Property should be abandoned from the Receivership Estate 

because the property is worth less than the debt and default taxes and 

approval of an agreement with Mid-Valley Services, Inc. to accept a deed in 

lieu of foreclosure is in the best interests of the receivership estate; 

• The personal property remaining at the Tipton Plant on the Tipton Property 

should be sold to the M. Davis Group for $25,000; and 

• The Receivership Estate should retain Colliers International to list, market 

and sell the Market Street Property because Colliers International has 

extensive experience in the Alameda County commercial real estate market; 

the commission is limited to 3%; and dual agency is prohibited. 

III. PROPOSED ACTIONS 

The Receiver bases her proposed actions for each of the Received Entities on the Recovery 

Plan (Docket No. 185) and the Declaration of Robert C. Divine filed in Support of the Recovery 

Plan (“Divine Decl., Exhibit 1, Recovery Plan, Docket No. 185), and incorporates both the 

Recovery Plan and Mr. Divine’s declaration. 

A. California Gold Medal, LLC and Central California Farms, LLC 

To the best of the Receiver’s information and belief, none of the investors in California 

Gold Medal, L.P. have had their I-526s approved by the USCIS and all of the petitions remain 

pending. None of the investors have immigrated to the United States. The Receiver is informed 

that it is likely that the USCIS will, in all probability, terminate SFRC’s regional center status, 

which will result in either denials or revocations of the investors’ petitions. The Receiver is also 

informed and believes that there is a discrepancy in the number and status of the investors 

between the records of the USCIS and counsel1

 for the investors. Although the Receiver has 

communicated with the USCIS, she has not had a response from the USCIS to her inquiries for 

updated confirming information. Because none of the investors I-526 petitions have been 

approved and none of the investors have immigrated to the United States prior to a time when the 

 

1

 Mr. James Yang is immigration counsel for SFRC and almost all investors in California Gold 

Medal, L.P. 

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009589.0024\4780951.10 RECEIVER’S MOTION FOR ORDER: (1) 

AUTHORIZING SALE OF PERSONAL 

PROPERTY 

8 3:17-CV-00223-RS

Wendel, Rosen, Black & Dean LLP 

1111 Broadway, 24t h Floor 

Oakland, California 94607-4036 

termination of SFRC’s regional center’s status appears likely, the Receiver is informed and 

believes that is highly unlikely that the California Gold Medal, L.P. investors will be able to obtain 

or retain their immigration benefits. On that basis, the Receiver, based on her business judgment, 

recommends that the assets of Relief Defendant, Central California Farms, LLC and the job 

creating entity, Crystal Golden, LLC, should be liquidated. Uecker Decl., ¶ 2. 

1. Business Operations 

Under the EB-5 program, California Gold Medal, L.P. was the new commercial enterprise 

while Crystal Golden, LLC was the job creating enterprise with its location at the Tipton Plant. 

The Business Plan provided for the use of $50 million from 100 Investors to loan the funds to 

Crystal Golden, LLC to fund the startup expenses of the company, including production of 

ultrahigh temperature milk production and the renovation of an existing dairy processing facility. 

(Recovery Plan, p. 43:15-19, Docket No. 185). 

Relief defendant Central California Farms, LLC owns the Tipton Property. The title report 

indicates a loan of $1.5 million with Mid-Valley Financial, Inc. against the property. The loan 

comes due on November 1, 2017 at which time the full $1.5 million will be due. (Recovery Plan, 

p. 45:9-12, Docket No. 185). The real property taxes are delinquent in the approximate amount of 

$160,0000. The commercial liability and umbrella insurance coverage (due to expire on 

November 3, 2017) are at issue due to unoccupied building exclusions under the policies. The 

current value based on a recent Broker Opinion of Value and reinspection after the recent 

equipment auction (removal) is $1.1 million, which is less than the current debt and defaulted 

taxes on the property. (Recovery Plan, p. 45:13-18, Docket No. 185). 

In May 2016, California Gold Medal, LLC entered into an agreement with Shambaugh & 

Son LP (“Shambaugh”) for design build services for an UHT/Aseptic Milk Plant at the Tipton 

Plant. In January 2017, Shambaugh completed the Scope of Work/Pricing/Schedule Proposal with 

an estimated guaranteed a cost of approximately $66 million. (Recovery Plan, p. 44:12-16, Docket 

No. 185). 

In December 2016 and January 2017, M. Davis Group conducted an auction of a majority 

of the equipment located at the Tipton Plant, which netted sale proceeds of $259,033.00. No 

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009589.0024\4780951.10 RECEIVER’S MOTION FOR ORDER: (1) 

AUTHORIZING SALE OF PERSONAL 

PROPERTY 

9 3:17-CV-00223-RS

Wendel, Rosen, Black & Dean LLP 

1111 Broadway, 24t h Floor 

Oakland, California 94607-4036 

auction proceeds were turned over to the Receiver. M. Davis Group, has now submitted a 

proposal for the remaining Equipment to 1) auction the remaining equipment for an estimated 

auction price of $25,000.00-$45,000.00 or 2) purchase the remaining equipment directly for 

$25,000.00. 

The Tipton Plant has never operated since its purchase in November 2015 for $4 million. 

(Recovery Plan, p. 44:17-22, Docket No. 185). 

2. Investor Status – I-526 Status and Risks for California Gold Medal, 

LLC Investors 

The immigration status and risks for California Gold Medal, L.P. investors were outlined 

in the Recovery Plan by special immigration counsel: 

California Gold Medal, L.P. . . . is the Enterprise that is to make a business of 

loaning EB-5 capital to Crystal Golden, LLC (the JCE) to develop and operate a 

new Ultra-High Temperature milk processing and production facility in Tipton, CA 

for sale and export to global markets. The JCE was to spend the capital in 

renovating and upgrading a leased facility, buying equipment, and startup of 

operations. The plan was to raise $50 million from 100 EB-5 Investors, and job 

creation projections were based on an assumption of over $6 million in 

construction expenditures, $23 million in equipment purchases, and $241 million 

revenues in operational year 2. The economist projected 1,565 direct and indirect 

jobs from operations and equipment expenditures and indirect jobs from 

construction expenditures. . . . [T]he USCIS chart reflects 27 investors filed I-526 

petitions, while the chart from James Yang reflects 47 investors who filed I-526, 

but both charts reflect that all petitions are pending at USCIS. Thus, termination of 

regional center would give rise to I-526 denial or revocation, which seems likely, 

and any liquidation of assets would need to lead to prompt re-deployment in similar 

industry. 

(Recovery Plan, Exhibit 1, Divine Decl., ¶ 67, Docket No. 185). 

To be eligible for I-526 approval, investors would need to show credibility of the 

business plan, which may be heavily undermined by the interruption of fundraising 

arising from the receivership, SEC complaint and allegations, etc. Any diversion or 

commingling of capital, which appears to be substantial, also would pose 

challenges to I-526 approval. I-526 approval for CGM investors appears quite 

unlikely. 

(Recovery Plan, Exhibit 1, Divine Decl., ¶ 68, Docket No. 185). 

3. Receiver’s Recommendation and Request 

It appears highly unlikely that California Gold Medal, L.P. investors will be able to obtain 

approval of their I-526s for the following reasons. The Business Plan for California Gold Medal, 

Case 3:17-cv-00223-RS Document 205 Filed 08/23/17 Page 9 of 15
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009589.0024\4780951.10 RECEIVER’S MOTION FOR ORDER: (1) 

AUTHORIZING SALE OF PERSONAL 

PROPERTY 

10 3:17-CV-00223-RS

Wendel, Rosen, Black & Dean LLP 

1111 Broadway, 24t h Floor 

Oakland, California 94607-4036 

L.P. lacks credibility. The plan was to raise $50 million in revenue for the construction of the 

ultra high temperature dairy plant, but the Shambaugh & Son LP design build construction bid far 

exceeded the amount of capital raised. Approximately $10 million in investors’ funds have been 

diverted and/or comingled.2 Because it is unlikely that California Gold Medal, L.P. investors will 

be able to obtain their immigration benefits primarily based upon the probable termination of 

SFRC’s regional center status (because none of the investors I-526s have been approved and they 

have not immigrated to the United States), the Receiver believes that liquidation of the assets of 

Relief Defendants Central California Farms and Chrystal Golden, LLC is warranted at this time. 

Uecker Decl. ¶ 3. For those reasons, the Receiver requests the approval of the following: 

a. Approval Of Agreement With M. Davis Group 

M. Davis Group has submitted a proposal to the Receiver for purchase of the remaining 

equipment at the Tipton Plant on the Tipton Property. The proposal is either to auction the 

equipment with an anticipated return of $25,000 to $45,000, or to pay $25,000 for a straight 

purchase of the equipment. The Receiver believes that accepting payment of $25,000 for the 

remaining equipment is in the best interests of the Receivership Estate. At auction, M. Davis 

Group receives 15% of the auction proceeds, and if the equipment only brings the low estimate, 

the estate will be worse off than if it had simply sold the equipment outright for $25,000. Also, 

the Receiver wants to exit the premises quickly and not be responsible for dealing with the 

removal of the equipment after the auction, which would require the estate to retain insurance 

possibly past the expiration date of the current policies in November 2017. Uecker Decl. ¶ 4. 

The Receiver may sell the remaining equipment at the Tipton Plant pursuant to the terms 

of the Appointment Order and 28 U.S.C. §§ 2001, 2004. Appointment Order, ¶¶ 35-37 (Docket 

No. 100). Section 2004 requires that personal property sold pursuant to an order of a court of the 

United States be sold in accordance with Section 2001, unless the court orders otherwise. Section 

2001 requires that property sold either at a public sale on the court house steps, or as the court 

 

2

 Declaration of Ellen Chen in Support of Plaintiff Securities and Exchange Commission’s 

Motion for Preliminary Injunction and for Appointment of Receiver (“Chen Decl.”), p. 9, Table 6, 

Docket No. 19. 

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009589.0024\4780951.10 RECEIVER’S MOTION FOR ORDER: (1) 

AUTHORIZING SALE OF PERSONAL 

PROPERTY 

11 3:17-CV-00223-RS

Wendel, Rosen, Black & Dean LLP 

1111 Broadway, 24t h Floor 

Oakland, California 94607-4036 

directs. 28 U.S.C. § 2001(b)3. Courts may deviate from the statutory sale structure for personal 

property provided by 28 U.S.C. § 2001 and 2004, because Section 2004 provides “unless the court 

orders otherwise.” SEC v. Kirkland, 2008 WL 4264532 (M.D. Fla. Sept 12, 2008) (private sale of 

motorcycle approved on Kelly Blue Book value without three appraisals where there was no 

objection and the cost of three appraisals would have diminished the value received.) Pursuant to 

the terms of the Appointment Order, the Receiver requests that the Court authorize the Receiver to 

enter into the Agreement with M. Davis Group to sell the remaining equipment at the Tipton Plant 

for $25,000, and to either deem the provisions of 28 U.S.C. §§ 2001 and 2004 satisfied, or provide 

that “the court otherwise approves the sale.” 

b. Approval Of Agreement With Mid-Valley Services, Inc. 

As stated above, the Receiver obtained a Broker Opinion of Value for the Tipton Property 

of $1.1 million. The debt against the property is $1.5 million, and the defaulted real estate taxes 

are $160,000, not including ongoing insurance. Because the Tipton Property is worth less than the 

amount of the debt, the Receiver seeks to abandon the property from the Receivership Estate since 

it represents a liability. The Receiver contacted Mid-Valley Services, Inc.,4

 the original lender, 

who has agreed to accept a deed in lieu of foreclosure for the Tipton Property. Uecker Decl., ¶ 5. 

The Receiver requests approval of an agreement with Mid-Valley Services, Inc. through its 

assignee, Tipton Investment Group, LLC, substantially in the form and substance of the 

Agreement for Deed in Lieu of Foreclosure and Escrow Instructions attached as Exhibit D to the 

Uecker Decl., and a determination that the disposition of the Tipton Property in this manner 

 

3

 Section 2001(b) also authorizes the sale of property by private sale. However, prior to 

confirmation of a private sale, the court must appoint three disinterested persons to appraise the 

property, and no private sale can be confirmed that is at a price less than two-thirds of the 

appraised value. 28 U.S.C. § 2001(b). The Receiver is of the opinion that the value of the 

remaining equipment at the Tipton Plant could not support the appointment of three appraisers. 

4

 On October 23, 2015, Mid-Valley Services, Inc. assigned a portion of its beneficial interest in 

the deed of trust against the Tipton Property to a number of fractionalized interest holders. MidValley Services, Inc. was contractually retained as the servicer for the assignees, and has the 

authority under the Loan Servicing Agreement to enter into the Agreement for Deed in Lieu of 

Foreclosure and Escrow Instruction. 

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009589.0024\4780951.10 RECEIVER’S MOTION FOR ORDER: (1) 

AUTHORIZING SALE OF PERSONAL 

PROPERTY 

12 3:17-CV-00223-RS

Wendel, Rosen, Black & Dean LLP 

1111 Broadway, 24t h Floor 

Oakland, California 94607-4036 

pursuant to Paragraphs 35-37 of the Appointment Order is exempt from the provisions of 28 

U.S.C. §§ 2001 and 2004. 

B. West Oakland Plaza, L.P. And JL Gateway, LLC 

Defendant West Oakland Plaza, L.P. is the new commercial enterprise that was supposed 

to fund the job creating entity, West End Market, LLC. The Business Plan for West Oakland 

Plaza, L.P. anticipated that 20 investors would invest $10 million to fund the West End Market, 

LLC, but only four investors invested in that new commercial enterprise, raising only $2 million. 

The Receiver is informed and believes that all of the investors’ I-526 petitions remain pending 

before the USCIS, and that none of the investors have immigrated to the United States. Because 

none of the investors I-526 petitions have been approved and none of the investors have 

immigrated to the United States prior to a time when the termination of the SFRC’s regional 

center’s status appears likely, the Receiver is informed and believes that it is highly unlikely the 

West Oakland Plaza, L.P. investors will be able to obtain or retain their immigration benefits. On 

that basis, the Receiver, recommends that the assets of Relief Defendant, JL Gateway, LLC,5

 the 

shopping center located at 800- 900 Market Street, Oakland, California (“Market Street 

Property”), should be listed for sale at this time. Uecker Decl., ¶ 6. 

1. Business Operations 

West Oakland Plaza, L.P. was the new commercial enterprise that was supposed to be 

capitalized with $10 million from 20 EB-5. The Business Plan provided for a loan of the EB-5 

funds to the job creating entity, West End Market, LLC. West End Market, LLC was supposed to 

develop a grocery store and commercial kitchen space in a neighborhood retail center with the EB5 capital. (Recovery Plan, p. 40:21-28, Docket No. 185). The grocery store business was never 

started, no improvements were ever made to the proposed space within the shopping center and no 

employees were hired. Relief Defendant, JL Gateway, LLC holds title to the Market Street 

Property. Based on the settlement statement, the Market Street Property was purchased in 

 

5

 Relief Defendant JL Gateway, LLC is owned 75% by San Francisco Regional Center LLC, and 

25% for Womac Properties, Inc. 

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009589.0024\4780951.10 RECEIVER’S MOTION FOR ORDER: (1) 

AUTHORIZING SALE OF PERSONAL 

PROPERTY 

13 3:17-CV-00223-RS

Wendel, Rosen, Black & Dean LLP 

1111 Broadway, 24t h Floor 

Oakland, California 94607-4036 

December 2014 with a deposit of $150,000 from SFRC. (Recovery Plan, p. 41:10-18, Docket No. 

185). 

The Market Street Property has been valued at $10,400,000 by Colliers InternationalBroker Opinion of Value. The current loan with Thorofare Capital has a balance due of 

$6,500,000. There is value in the Market Street Property to the receivership estate of 

approximately $3,900,000. Uecker Decl., ¶ 7. As described below, the Receiver proposes to 

retain Colliers International to list, market and sell the Market Street Property. 

2. Investor Status-I-526 Status And Risks for West Oakland Plaza, L.P. 

The investors’ immigration status and risks for West Oakland Plaza, L.P. were set forth in 

the Recovery Plan by special immigration counsel: 

West Oakland Plaza, L.P. . . . is the Enterprise intended to raise $10 million from 

20 EB-5 investors and loan that capital to West End Market, LLC as the JCE to 

develop and operate a grocery store, restaurant, and commercial kitchen in a retail 

center in West Oakland. The economic analysis presumed from the JCE's business 

plan that it would employ 204 direct employees (123 in grocery, 47 in 

commissary, 12 in restaurant/café, and 22 cross-over jobs) and concluded that this 

would create 96.5 indirect jobs for a total of 300.5 jobs created. 

Only four investors subscribed and filed I-526 petitions, which are pending with 

USCIS. Thus, termination of regional center would give rise to I-526 denial or 

revocation, which seems likely, and any liquidation of assets would need to lead to 

prompt re-deployment in similar industry. To be eligible for I-526 approval, 

investors would need to show credibility of the business plan, which may be 

heavily undermined by the interruption of fundraising arising from the receivership, 

SEC complaint and allegations, etc. Any diversion or commingling of capital also 

would pose challenges to I-526 approval. I-526 approval for the WOP investors 

appears quite unlikely. 

(Recovery Plan, Exhibit 1, Divine Decl., ¶ 69-70, Docket No. 185). 

3. Receiver’s Recommendation and Request 

Although West Oakland Plaza, L.P. was supposed to raise funds from twenty investors, 

only four investors subscribed and have filed I-526 petitions. Investors invested approximately 

$2.2 million,6 far short of the necessary $10 million. The Business Plan lacks credibility, because 

the grocery store, West End Market, was never operational, no improvements were ever made, and 

no employees were ever hired. West Oakland Plaza, L.P. investor funds of $786,000 were 

 

6

 Chen Decl., p. 4, Table 2, Docket No. 19. 

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009589.0024\4780951.10 RECEIVER’S MOTION FOR ORDER: (1) 

AUTHORIZING SALE OF PERSONAL 

PROPERTY 

14 3:17-CV-00223-RS

Wendel, Rosen, Black & Dean LLP 

1111 Broadway, 24t h Floor 

Oakland, California 94607-4036 

transferred to North America 3PL, LLC and net investor funds of $244,500 were transferred to 

Immedia, LLC, 7 representing approximately 50% of all investors’ funds either commingled or 

diverted. In addition to those funds, $603,000 was transferred to the owner of the Market Street 

Property, Relief Defendant JL Gateway, LLC.8 In addition, it appears that JL Gateway, LLC 

acquired the Market Street Property with investor funds sourced through CallSocket III, L.P. and 

NA3PL, L.P.9 The approval of West Oakland Plaza investors’ I-526 petitions appear unlikely due 

to such diversion and/or commingling and/or probable termination of SFRC’s regional center 

status. Accordingly, on that basis, and on her business judgment, the Receiver believes that the 

Market Street Property should be listed for marketing and sale at this time. Uecker Decl., ¶ 8. 

Pursuant to Paragraph 36 of the Appointment Order, the Receiver is “authorized to locate, 

list for sale or lease, engage a broker for sale or lease, cause the sale or lease, and take all 

necessary and reasonable actions to cause the sale or lease of all real property in the Receivership 

Estates.” The Receiver requests authorization to enter into an Exclusive Authorization to Sell 

Agreement (“Listing Agreement”) with Colliers Parrish International, Inc., dba Colliers 

International for the listing, marketing and sale of the Market Street Property. A true and correct 

copy of the Listing Agreement is attached as Exhibit G to the Uecker Decl. Pursuant to the terms 

of the Listing Agreement: 

• The listing price shall be $10.4 million; 

• The Listing Agreement is for 6 months, ending on December 31, 2017; 

• The broker’s commission shall be 3%; 

• All sales are subject to court approval; and 

• Dual agency is prohibited. 

The Receiver believes that the Listing Agreement is in the best interest of the receivership 

estate because Colliers International has extensive experience in the commercial real estate market 

 

7

 Chen Decl., p. 8, Table 5, Docket No. 19. 

8

 Chen Decl., p. 8, Table 5, Docket No. 19. 

9

 Chen Decl., ¶¶ 55-56, Diagram G, Docket No. 19. 

Case 3:17-cv-00223-RS Document 205 Filed 08/23/17 Page 14 of 15
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009589.0024\4780951.10 RECEIVER’S MOTION FOR ORDER: (1) 

AUTHORIZING SALE OF PERSONAL 

PROPERTY 

15 3:17-CV-00223-RS

Wendel, Rosen, Black & Dean LLP 

1111 Broadway, 24t h Floor 

Oakland, California 94607-4036 

for Alameda County; the commission is limited to 3% and dual agency is prohibited. Filed 

concurrently herewith is the Declaration of Aileen Dolby in support of the Receiver’s Motion 

attesting to her connections with the receivership estate and her experience as a broker. The 

Receiver requests approval of the Listing Agreement pursuant to the terms of the Appointment 

Order. Uecker Decl., ¶ 9. 

IV. CONCLUSION 

Wherefore, the Receiver prays for an order of this court that: 

1. Pursuant to Paragraphs 35-37 of the Appointment Order, the Receiver is authorized 

to enter into the agreement with M. Davis Group for the sale of the remaining equipment located 

at the Tipton Plant on the Tipton Property as set forth in the Motion; 

2. Pursuant to Paragraphs 36-37 of the Appointment Order, the Receiver is authorized 

to enter into the agreement with Mid-Valley Services, Inc. to accept a deed in lieu of foreclosure 

for the Tipton Property as set forth in the Motion; 

3. Pursuant to Paragraph 36 of the Appointment Order, the Receiver is authorized to 

enter into the Listing Agreement with Colliers International as set forth in the Motion; and 

4. For such other and further relief as the court deems proper. 

DATED: August 23, 2017 WENDEL, ROSEN, BLACK & DEAN LLP 

By: /s/ Elizabeth Berke-Dreyfuss 

 Elizabeth Berke-Dreyfuss 

Attorneys for Susan L. Uecker, Receiver 

Case 3:17-cv-00223-RS Document 205 Filed 08/23/17 Page 15 of 15