Ersin Akyuz sues Serhat Gumrukcu for fraud

1. ~ SHORT TITLE: Akyuz v. Gumrukcu, et al. CASE NUMBER:
SC124544
2 Attachment Sa:
3 Parties. Judgment is
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a. for plaintiff: Ersin Akyuz
and against defendants: (l) Serhat Gumrukcu, an individual ("Gumrukcu") and
(2) ERMES LLC, a California joint venture ("Ermes-N") as follows:
- Ofthe $1,200,000.00 in "Damages" set forth in item 6 ofthe Judgment, Gumrukcu and Ermes-N
are joint and severally liable for first $930,000.00, and Gumrukcu is severally liable
for the remaining $270,000.00;
- Ofthe $83,835.62 in "Prejudgment interest" set forth in item 6 ofthe Judgment, Gumrukcu and
Ermes-JV are joint and severally liable for the first $64,972.61, and Gumrukcu is severally liable
for the remaining $18,863.01 ;
- Ofthe $4,614.76 in "Costs" set forth in item 6 of the Judgment, Gumrukcu and Ermes-N
are joint and severally liable; and
- Ofthe $465,000.00 in "Punitive Damages" set forth in item 6 of the Judgment, Gumrukcu is
liable for this amount alone.
18 Attachment 7:
19 Plaintiff has proven both fraud and breach of promissory note.
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26 (Required for verified pleading) The items on this page stated on information and belief are (specify item numbers, not line
numbers):
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This page may be used with any Judicial Council form or any other paper filed with the court.
Form Approved by lhe
Judicial Council cl California
MC-020 (New January 1. 1987]
ADDITIONAL PAGE
Attach to Judiclal Councll Fonn or Other Court Paper
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•
Jeffrey B. Valle (State Bar No. 110060)
jvalle@vallemakoff.com
Ilan Wisnia (State Bar No. 249137)
iwisnia@vallemakoff.com
VALLE MAKOFF LLP
11911 San Vicente Blvd., Suite 324
Los Angeles, California 90049
Telephone: (310) 476-0300
Facsimile: (310) 476-0333
Attorneys for PlaintiffERSIN AKYUZ
FILED
Superior Court of California
County of Los Angeles
JUL 31 2015
Sherri rter, Execu1'6 Officer/Clerk
By_~~:r--:-
~--=-- - Deputy
.'I Da tta Smith
SUPERIOR COURT OF THE STATE OF CALIFORNIA
COUNTY OF LOS ANGELES - WEST DISTRICT
ERSIN AKYUZ, an individual,
Plaintiff,
V.
SERHAT GUMRUKCU, an individual;
ERMES LLC, a California joint venture;
and DOES 1 through 10, inclusive,
Defendants.
SC1.24544
Case No.
COMPLAINT FOR:
1) FRAUD;
2) BREACH OF FIDUCIARY DUTY;
3) CONVERSION;
4) BREACH OF CO-OWNERSHIP
AGREEMENT;
5) BREACH OF JOINT VENTURE
AGREEMENT;
6) BREACH OF PROMISSORY NOTE; and
7) ACCOUNTING
JURY TRIAL DEMANDED
CASE MANAGEMENT CONFERENCE
NOV 18 ~~tt; Richard A. Stone
Date~ ~
COMPLAINT

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1 PlaintiffErsin Akyuz, by and through his attorneys of record, allege, upon personal
2 knowledge with respect to himself and to his actions and upon information and beliefas to all
3 other matters, as follows:
4 OVERVIEW
5 l. This case arises from the fraud, conversion, breach offiduciary duty, breach of
6 contract, and complete abuse oftrust by Defendant Serhat Gumrukcu, a purported "business
7 partner" of Plaintiff Ersin Akyuz. Plaintiffis a successful businessman and executive living in
8 Istanbul, Turkey. Under the pretext of forming a joint venture to purchase, remodel, and sell a
9 run-down house in West Hollywood, California, Gumrukcu stole over $930,000 from Akyuz.
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2. Gurnrukcu managed to commit these tortious acts, in part, by (1) falsely claiming
to Akyuz to have entered into escrow for a house located in West Hollywood, when he had not;
(2) providing Akyuz with forged escrow documents showing that the purchase ofthe West
Hollywood property had closed, when it had not; (3) assuming the identify ofan attorney
purportedly hired to represent both him and Akyuz, and then communicating with Akyuz via e-
mail as if he was this attorney (via a fictitiously created e-mail address purportedly belonging to
this attorney); (4) providing Akyuz with joint venture related corporate formation documents, so
as to induce Akyuz to contribute $500,000 towards the purchase ofthe West Hollywood property;
and (5) after the purchase ofthe West Hollywood property purportedly closed, periodically
requesting Akyuz to supply additional funds (totaling over $430,000) to be used to pay for
various remodeling costs - all of which were fictitious costs as the property had never been
purchased.
3. Gumrukcu's fraud went so far as to fake an eventual sale of the property, with
repeated statements to Akyuz that he would be paid his money shortly. Gumrukcu furthermore
faked a phantom profit on this alleged sale, claiming that Akyuz was entitled to an additional
$186,000 on top ofthe return of his investment (for $1.116 million in total). When this did not
occur, and presumably to stall for even more time, Gumrukcu executed a promissory note in favor
of Akyuz in the amount of $1.2 million. Perhaps unsurprisingly, neither the $1.116 million due
from the sale, nor the $1 .2 million due under the promissory note, was ever paid.
COMPLAINT

4. complaint to assert the true names and capacities ofsuch fictitiously named defendants when they
2 have been ascertained. For convenience, each reference herein to a defendant will also refer to
3 Does I through I0.
4 STATEMENT OF FACTS
5 9. PlaintiffErsin Akyuz is the ChiefExecutive Officer ofthe Turkish subsidiary of
6 Deutsche Bank (aka "Deutsche Bank AS."). Professionally and personally, Akyuz overseas
7 investments all over the world.
8 10. In early June of2014, Defendant Serhat Gumrukcu approached Akyuz about
9 investing in a property located at 8940 Dicks St., West Hollywood, California 90069 (the "West
10 Hollywood Property"). Gumrukcu told Akyuz that the West Hollywood Property was
11 undervalued, and with some renovation, could be sold for a profit. Gumrucku further explained
12 that he was already in escrow to purchase the West Hollywood Property, so that ifAkyuz was
13 interested in investing in this deal alongside him, he had to decide immediately so that the
14 appropriate legal documentation could be drafted. Akyuz agreed to proceed along these lines.
15 11. Later in the month, Gumrukcu communicated to Akyuz that he had retained the
16 legal services ofan attorney, Benjamin Kacev, to prepare the necessary legal paperwork.
17 12. On July 2, 2014, Kacev purported to e-mail to Akyuz and Gumrukcu a Co-
18 Ownership Agreement and a Joint Venture Agreement. This e-mail was sent from Kacev's
19 alleged gmail account address, "benkacev@gmail.com." In Kacev's cover e-mail to Akyuz and
20 Gumrukcu, Kacev indicated that he had purposely backdated the Co-Ownership Agreement to
21 June 25, so to make it "easier for us to add Ersin as 50% owner during the title recording..."
22 Akyuz thereafter signed and returned both agreements. Gumrukcu did the same.
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13. Under the terms ofthe June 25, 2014 Co-Ownership Agreement, Akyuz and
Gumrukcu each agreed to contribute $500,000 towards the purchase ofthe West Hollywood
Property (for $1 million in total). Akyuz agreed to pay his $500,000 by depositing it in a bank
account held in the name ofErmes LLC, an account held at Boston Private Bank & Trust
Company in Santa Monica, California ("Boston Private Bank"). In exchange for Akyuz making
COMPLAINT

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this $500,000 investment, Gumrukcu agreed to "amend the purchase agreement and add
[Akyuz] as the 50% owner of the property upon closing." In tum, upon sale ofthe property,
Akyuz was to be repaid his $500,000 before any profit were to be divided. A true and correct
copy ofthe Co-Ownership Agreement is attached hereto as Exhibit "A" and is incorporated
herein by reference.
14. Under the terms ofthe July 2, 2014 Joint Venture Agreement, Akyuz and
Gwnrukcu agreed to form a joint venture in the name ofErmes LLC. The stated purpose ofthe
venture was to "participate in the redevelopment and the sale of the [West Hollywood
Property]." Akyuz's sole responsibility was to contribute $500,000, while Gumrakcu's
responsibilities included not only contributing $500,000, but overseeing all legal, financial, and
operational aspects ofthe redevelopment. Upon the sale ofthe West Hollywood property, Akyuz
was to be repaid his original $500,000, as well as 40% ofany net profits that might arise.
Importantly, this repayment was to occur "immediately" upon the sale ofthe property. Section
S(a) to the Joint Venture Agreement states, "[i]mmediately upon completion of the sale of
redeveloped [West Hollywood property], the capital investors will be fully paid their initial
investments back ..." A true and correct copy ofthe Joint Venture Agreement is attached hereto
as Exhibit "B" and is incorporated herein by reference.
15. On or about July 8, 2014, Gumrukcu delivered to Akyuz escrow documents,
19 purporting to show that the purchase ofthe West Hollywood Property had closed. The
20 documents were written on the letterhead of"Beverly Hills Escrow," and were directed to "Ermes
21 LLC and Mr. Ersin Akyuz." A true and correct copy ofthese escrow documents are attached
22 hereto as Exhibit "C" and are incorporated herein by reference.
23 16. Between August and December of2014, Gumrukcu periodically requested that
24 Akyuz provide additional funds to help pay for redevelopment costs associated with the West
25 Hollywood Property. Akyuz acceded to these requests, and provided $150,000 in August of
26 2014, $170,000 in October of2014, and $110,000 in December of2014 (for a total of$430,000).
27 17. In December of2014, Gumrukcu told Akyuz that a friend ofhis had agreed to
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COMPLAINT

6. purchase the West Hollywood Property when the redevelopment was complete. In March of
2 2015, Gumrukcu told Akyuz that that redevelopment had finally been completed, and that he was
3 in the process ofselling the West Hollywood Property to his friend.
4 18. On April 15 and 16, 2015, Kacev e-mailed Akyuz and Gumrukcu confirming that
5 the sale had closed (for a total of $2.35 million), and that Akyuz was entitled to a total of$1.116
6 million ofthe sales proceeds (which included the repayment ofhis initial investment, additional
7 capital contributions, and 40% ofthe profits). Kacev indicated that the proceeds would be wired
8 to Akyuz shortly.
9 19. After a month ofno money being received, Akyuz repeatedly demanded an
10 explanation from Gumrukcu. Instead ofproviding a legitimate or credible response, Gumrukcu
11 simply provided one excuse after another. To try to buy more time, Gumrukcu provided Akyuz
12 with a promissory note dated June I, 2015. This promissory note promised to pay Akyuz $1.2
13 million, plus interest, on or before July 30, 2015. A true and correct copy ofthis promissory note
14 is attached hereto as Exhibit "D" and is incorporated herein by reference.
15 20. Through an independent investigation since May of2015, Akyuz has come to find
16 that he has been the victim ofa massive fraud.
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21. Akyuz is informed and believes, and on that basis alleges, that the West
Hollywood Property was never in fact purchased by Gumruku or Ermes. Instead, public records
show that the property was purchased by "8135 Norton Avenue Inc." on August 18, 2014. Akyuz
is informed and believes, and on this basis alleges, that 8135 Norton Avenue Inc. has no
relationship with Gumrukcu or Ermes.
22. Akyuz is informed and believes, and on that basis alleges, that the escrow
documents transmitted by Gumrukcu are in fact forgeries. Beverly Hills Escrow has confirmed
that they have no record ofthe West Hollywood Property in their records, and that they have
never even heard ofGumrukcu or Ermes.
23. Akyuz is informed and believes, and on that basis alleges, that Kacev was never
engaged by either Gumrukcu to provide legal services to him and/or Akyuz. Kacev, as identified
COMPLAINT