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Case 3:17-cv-02575-CAB-WVG Document 2 Filed 12/29/17 PageID.

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1 ZOUVAS LAW GROUP, LLP


Luke C. Zouvas, Esq. (SBN 216154)
2 2907 Shelter Island Drive, Suite 105
San Diego, CA 92106
3 (619) 300-6971
lzouvas@zouvaslaw.com
4
Attorney for Plaintiff and
5 In Pro Per
6
7
8 UNITED STATES DISTRICT COURT
9 SOUTHERN DISTRICT OF CALIFORNIA
10
11 NOHO, INC., and LUKE C. ZOUVAS Case No.: 3:17-cv-02575-CAB-WVG
12 Plaintiffs,
13 v. FIRST AMENDED COMPLAINT FOR:
14 RONALD E. HEINEMAN, CLIFFORD 1. MISREPRESENTATION;
15 M. RHEE, NGEN TECHNOLOGIES USA 2. PROMISE WITHOUT INTENT
CORP., EDWARD CARTER, DR. TO PERFORM;
16 3. RECISSION; and
JASON KOO, DAVID
LITHWICK,GREENFIELD FARMS 4. INJUNCTIVE RELIEF
17
FOOD, INC., and DOES 1-5, inclusive
18
Defendants.
19
20
21 Plaintiff, NOHO, INC., a publicly traded Wyoming corporation, together with their
22 counsel and shareholder of NOHO, INC. (hereinafter collectively referred to as
23 "Plaintiff"), hereby amends their initial Complaint, adding other discovered Defendants,
24 alleges as follows:
25 PLAINTIFF AND DEFENDANTS
26 1. Plaintiff is and at all times herein mentioned was, a publicly traded
27 Wyoming corporation organized and existing under the law of the State of Wyoming,
28 with its principal place of business in the State of Arizona.

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1 2. Plaintiff Luke Zouvas, a shareholder of NOHO, Inc., at all times mentioned,


2 was and still is a resident of San Diego County, State of California and the sole drafter of
3 the Agreement which is the subject matter of this original Complaint and this First
4 Amended Complaint.
5 3. Plaintiff is informed and believes, and hereinafter alleges that Defendant,
6 RONALD E. HEINEMAN, (hereinafter “Heineman"), is, and at all times herein
7 mentioned was, an individual residing in Cincinnati, Ohio. Heineman was the Chief
8 Executive Officer and Chairman of the Board of Directors of Defendant Greenfield
9 Farms Foods, Inc. (hereinafter “Greenfield”) when the alleged tortious acts were
10 committed against Plaintiff.
11 4. Plaintiff is informed and believes, and hereinafter alleges that Defendant,
12 CLIFFORD M. RHEE (hereinafter "Rhee"), is, and at all times herein mentioned was, the
13 current Chief Executive Officer of Greenfield who helped Heineman execute the alleged
14 tortious acts.
15 5. Plaintiff is informed and believes, and hereinafter alleges that Defendant,
16 NGEN TECHNOLGIES USA CORP. (hereinafter "Ngen"), is, and at all times herein
17 mentioned was, the subsequent company who was purchased pursuant to a letter of intent
18 with Greenfield.
19 6. Plaintiff is informed and believes, and hereinafter alleges that Defendant,
20 EDWARD CARTER (hereinafter "Carter"), is, and at all times herein mentioned was, a
21 member of the Board of Directors of Greenfield who helped Heineman execute the
22 alleged tortious acts.
23 7. Plaintiff is informed and believes, and hereinafter alleges that Defendant, Dr.
24 Jason Koo (hereinafter "Koo"), is, and at all times herein mentioned was, member of the
25 Board of Directors of Greenfield who helped Heineman execute the alleged tortious acts.
26 8. Plaintiff is informed and believes, and hereinafter alleges that Defendant,
27 David Lithwick (hereinafter "Lithwick"), is, and at all times herein mentioned was, Chief
28

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1 Technology Officer of Greenfield who helped Heineman execute the alleged tortious
2 acts.
3 9. Defendants DOES 1 through 5, inclusive, is sued herein under fictitious
4 names. Their true names and capacities are unknown to Plaintiff. When their true names
5 and capacities are ascertained, Plaintiff will amend this complaint by inserting their true
6 names and capacities herein. Plaintiff is informed and believes and thereon alleges that
7 each of the fictitiously named defendants are responsible in some manner for the
8 occurrences herein alleged, and that Plaintiff’s damages, as herein alleged, were
9 proximately caused by such defendants.
10 10. Plaintiff is informed and believes and thereon alleges that at all times herein
11 mentioned, each of the Defendants were acting as the agent of each of the remaining
12 defendants, and in doing the things hereinafter alleged, were acting within the course and
13 scope of such agency, and with the permission and consent of his or her or its co-
14 Defendants.
15 11. Plaintiff is a publicly-traded Wyoming corporation with its principal place of

16 business in the State of Arizona, County of Maricopa.

17 12. Plaintiff is informed and believes and thereon alleges that the Defendants are

18 citizens of other states, and thus Diversity Jurisdiction exists pursuant to 18 U.S.C. 1332.

19 13. The Court has jurisdiction over this action pursuant to Sections 20(b), 20(d)

20 and 22(a) of the Securities Act, 15 U.S.C. §§ 77t(b), 77t(d) and 77v(a); and Sections

21 21(d) and 27(a) of the Exchange Act, 15 U.S.C. §§ 78u(d) and 78aa(a).

22 JURISDICTION AND VENUE

23 13. Plaintiff is informed and believes and thereon alleges that the Defendants are

24 citizens of other states, and thus Diversity Jurisdiction exists pursuant to 18 U.S.C. 1332.

25 14. The Court has jurisdiction over this action pursuant to Sections 20(b), 20(d)

26 and 22(a) of the Securities Act, 15 U.S.C. §§ 77t(b), 77t(d) and 77v(a); and Sections

27 21(d) and 27(a) of the Exchange Act, 15 U.S.C. §§ 78u(d) and 78aa(a).

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1 15. The Court has personal jurisdiction over Defendants and venue is proper in

2 this District because, among other things, Defendants participated in the offer or sale of

3 securities in this District, and many of the acts and transactions constituting the violations

4 alleged in this Complaint occurred in this District. In addition, venue is proper in this

5 District under 28 U.S.C. § 1391 because a substantial part of the events giving rise to the

6 Commission’s claims occurred here.

7 16. In connection with the conduct alleged in this Complaint, Defendants,

8 directly and indirectly, singly or in concert with others, have made use of the means or

9 instrumentalities of interstate commerce, the means or instruments of transportation or

10 communication in interstate commerce, the mails, and/or the facilities of a national

11 securities exchange.

12 17. The amount in controversy requirement is met under 28 U.S.C. 1332 as the
13 Plaintiff contends it has been damaged by Defendants in an amount of $2,000,000.00.
14 Venue is proper in the Southern District of California – San Diego under 28 U.S.C.
15 1391(a)(1) and (2) because a substantial part of the events or omissions giving rise to
16 Plaintiff's claim occurred in the State of California, County of San Diego.
17 18. Venue is proper in this district pursuant to Section 22(a) of the Securities
18 Act, 15 U.S.C. § 77v(a), and Section 27 of the Exchange Act, 15 U.S.C.§ 78aa, because
19 the defendants reside and conduct business in the district and because certain of the
20 transactions, acts, practices, and courses of conduct constituting violations of the
21 federal securities laws occurred within this district.
22 FACTUAL ALLEGATIONS

23 19. On or about June 7, 2017, Plaintiff NoHo, (through its wholly-owned

24 subsidiary Cherry Hill Financial, LLC (“Cherry Hill”)) and Defendant GRAS, entered

25 into an Asset Purchase Agreement (the “Agreement”) (See Exhibit A attached hereto).

26 20. Cherry Hill is in the financial services industry and currently pursuing

27 insurance syndication where companies having net operating losses with medium to large
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1 employee bases to offer life insurance coverage to their mid-level and lower-level

2 employees and pay their premiums for two years (the "Business").

3 21. Defendant GRAS purchased and assumed from Cherry Hill, certain assets,

4 rights and obligations related to the Business for approximately 49% of the issued and

5 outstanding common stock of GRAS. Further, Defendant Heineman promised to assign

6 all of the Series D Preferred Stock of GRAS, in the form of a voting proxy (“Majority

7 Proxy”) in order for Plaintiff NoHo to have an outright majority vote for all matters of

8 GRAS post transaction. (See Exhibit B attached hereto).

9 22. However, Defendant Heineman never caused to be issued the 49% of the

10 common stock to Plaintiff NoHo, as well as, Assign the Majority Proxy to Plaintiff

11 NoHo.

12 23. In connection with the inducement, described above, of Plaintiff NoHo, to

13 prolong declaring a breach of agreement, Defendant Heineman made certain false

14 statements and affirmative misrepresentations of material facts; namely, that the 49% of

15 common shares would be issued as soon as GRAS’S audit was complete, a total lie (See

16 Exhibit C attached hereto).

17 24. No shares were issued as represented. No Majority Proxy was assigned to

18 Plaintiff.
19 25. At all times material hereto, Defendant Heineman was lying to Plaintiff, and
20 that the representation above mentioned were utterly false and made for sole purpose of
21 inducing reliance by NoHo, without regard to damage Plaintiff.
22 26. Plaintiff did in fact reasonably and justifiably rely upon the material
23 misrepresentation of all Defendants, and have been seriously damaged thereby, with
24 respect to the complete denial of NoHo’s ownership of GRAS.
25 27. By the conduct, heretofore described, Defendants have materially breached
26 the Agreement, and Plaintiff hereby declares that Agreement breached. Accordingly,
27 Plaintiff NoHo is excused from further performance and is not obliged to suffer the
28 negative perception of the public view and the declining stock price of Plaintiff NoHo.

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1 28. However, Defendants have completely ignored all attempts by Plaintiff to

2 rectify the situation and has subsequently entered into other transactions for their own

3 gain, without the consent of Plaintiff, and cannot be undone without extreme damage to

4 all shareholders of NoHo and NoHo itself by lawful proceedings. There would therefore

5 be no adequate remedy at law.

6 29. Accordingly, Plaintiff will suffer irreparable damage, should Defendants not
7 stopped from looting the Company in violation of the Agreement.
8 30. Plaintiff requests a temporary restraint against Defendants, until the
9 rights of the parties to the shares can be sorted out definitively, in an orderly and
10 professional manner.
11 FIRST CAUSE OF ACTION
12 (Misrepresentation)
13 31. Plaintiff repeats and repleads Paragraphs 1 through 30, inclusive, of this
14 Complaint and incorporates them by reference as though fully set forth in this First Cause
15 of Action.
16 32. Defendants Heineman/GRAS made material misrepresentations of fact as
17 hereinbefore alleged. Such representations were in fact false and untrue.
18 33. Defendants Heineman/GRAS knew, in making such representations that
19 such representations were false, misleading and were made without intention to perform
20 or make such representations substantially true.
21 34. Such representations were made with the intent to deceive PLAINTIFFS and
22 to induce Plaintiff's reliance.
23 35. PLAINTIFFS were unaware of the falsity of DEFENDANT’S
24 representations, and actually, reasonably and justifiably relied to his detriment on
25 DEFENDANT’S representations.
26 36. Plaintiff has been damaged, and may be further damaged, as a proximate
27 result thereof.
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1 37. On information and belief, DEFENDANT’S fraud in the inducement was


2 willful, malicious, oppressive and in conscious disregard of Plaintiff’s rights, entitling
3 Plaintiff to punitive damages.
4 38. As a direct and proximate result of DEFENDANT’S negligence, Plaintiff
5 has been required to retain legal counsel and incur costs of suit in order to protect his
6 legal rights. Plaintiff has incurred and will continue to incur attorney’s fees and costs to
7 prosecute this action.
8 SECOND CAUSE OF ACTION
9 (Promise Without Intent To Perform, CCP 1710(4))
10 39. Plaintiff repeats and repleads Paragraphs 1 through 38, inclusive, of this
11 complaint and incorporates them by reference as though fully set forth in this Second
12 Cause of Action.
13 40. At the time Plaintiff and Defendants entered into the Agreement, and
14 afterwards, Defendants promised to issue Plaintiff’s shares and the Majority Proxy,
15 however, Defendant Heineman never had intent to perform his obligations because he
16 never paid the Transfer Agent in order to get Plaintiff’s Shares issued.
17 41. On information and belief, at the time Defendants made those promises,
18 Defendant Heineman had no intention of performing them and knew he would sign other
19 Agreements for his own benefit and use which is evidence by the his willful and deceitful
20 plan to purposely not pay the Transfer Agent and thus not have to the issue Plaintiff’s
21 shares.
22 42. On information and belief, the promises were made by Defendant with the
23 intent to induce Plaintiff to enter into the Agreement, and with no intention to do business
24 with Plaintiff NoHo.
25 43. At the time these promises were made, Plaintiff was ignorant of the secret
26 intentions of Defendant not to perform his obligations under the Agreement.
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1 44. In reliance on the promises of Defendants, PLAINTIFFS were induced to


2 enter into the Agreement, and then to put out a press release pursuant Securities
3 Exchange Act of 1934, and as a result was damaged thereby.
4 45. If Plaintiff had known the actual intention of Defendant, Plaintiff would not
5 have entered into the Agreement, nor agreed to release any news thereto.
6 46. On information and belief, DEFENDANT’S promises without intention to
7 perform were willful, malicious, oppressive, and in conscious disregard of the rights and
8 interest of Plaintiff, such as to entitle Plaintiff to punitive damages.
9 47. As a direct and proximate result of the misrepresentations of Defendant,
10 Plaintiff has been damaged in an amount to be determined at trial.
11 48. As a direct and proximate result of DEFENDANT’S negligence, Plaintiff
12 has been required to retain legal counsel and incur costs of suit in order to protect his
13 legal rights. Plaintiff has incurred and will continue to incur attorney’s fees and costs to
14 prosecute this action.
15 THIRD CAUSE OF ACTION
16 (Rescission Against Defendant)
17 49. Plaintiff repeats and repleads Paragraphs 1 through 48, inclusive, of this
18 complaint and incorporates them by reference as though fully set forth in this Third
19 Cause of Action.
20 50. The conduct of Defendants hereinbefore alleged, constituted and constitutes
21 a material breach of the Agreement.
22 51. Plaintiff intends the service of Summons and Complaint in this action to
23 constitute notice of rescission of those agreements.
24 FOURTH CAUSE OF ACTION
25 (Injunctive Restraint)
26 52. Plaintiff repeats and repleads and incorporates by reference the allegations in
27 Paragraph 1 through 51, inclusive, as though fully set forth in this Forth Cause of Action.
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1 53. Defendant Heineman is diluting the value of GRAS by executing subsequent


2 agreement for his own pecuniary gain. Defendant Heineman has executed a letter of
3 intent for shares of GRAS with NGEN Technologies, Inc., and once the shares are issued
4 to NGEN, Plaintiff NoHo’s stock value will spiral downward robbing Plaintiff NoHo and
5 the public shareholder of value which cannot be recovered by lawful proceedings. There
6 would therefore be no adequate remedy at law.
7 54. Accordingly, Plaintiff will suffer irreparable damage, should his shares be
8 issued to NGEN, fraudulently or in violation of the breached Agreement.
9 55. Plaintiff has no adequate remedy at law to prevent the further loss of value
10 to Plaintiff. It is necessary to freeze any issuance of GRAS shares by Defendant
11 Heineman, and to preserve the status quo, during the pendency of these proceedings.
12 56. Plaintiff has clean hands in every aspect of the transactions hereinbefore
13 alleged, and has performed honestly and fairly in all respects.
14 57. Plaintiff offers to do equity and to act equitably, in all respects, to
15 Defendants and as directed by the Court.
16 FIFTH CAUSE OF ACTION
17 (Intentional Interference with Prospective Economic Relations)
18 (Against all Defendants and DOES 1-5)
19 58. Plaintiff repeats and re-alleges the allegations contained in paragraphs 1
20 through 57, inclusive, and incorporates the same as though set forth in full herein.
21 59. At all times during Defendants relationship with Plaintiff,
22 60. Plaintiff fulfilled all obligations under the written and signed Asset Purchase
23 Agreement.
24 61. Plaintiff relied on the honor and dignity of all Defendants to do the same.
25 62. Plaintiff risked their reputation as well as their business by signing the
26 agreement with Greenfield. Plaintiff entered the agreement with the belief that
27
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1 Greenfield would facilitate a good relationship between them. The Plaintiff believed this
2 relationship would be mutually agreeable and an equal effort from both parties.
3 63. Greenfield was aware of the nature of the business relationship Plaintiff was
4 trying to establish with Greenfield by being in the same industry of business. Plaintiff is
5 informed and believes and thereon alleges that Greenfield willfully entered into the
6 agreement with Plaintiff with no intention to facilitate a good, healthy and profitable
7 business relationship with Plaintiff, and therefore knowingly wasting Plaintiff’s valuable
8 time and effort, and putting Plaintiff’s reputation at risk.
9 64. Plaintiff is informed and believes and thereon alleges that all Defendants,
10 had the intention to misappropriate Plaintiff's funds in order to utilize these funds for
11 their own benefit.
12 65. Plaintiff is informed and believes and thereon alleges that Greenfield
13 accepted the requested fees from Plaintiff with the intention of not honoring the written
14 and signed agreement if the need were to arise for a refund under the terms outlaid in the
15 agreement.
16 66. As a proximate result of Defendants' conduct Plaintiff has suffered damages
17 in an amount within the jurisdictional limits of this Court, according to proof at trial.
18 67. The actions of Defendants threaten to disrupt other contractual relationships
19 and negotiations between Plaintiff and Plaintiff’s customers and potential customers. As
20 a result, Plaintiff stands to suffer great and irreparable injury, for which damages would
21 not afford adequate relief in that, among other reasons, legal remedies would not fully
22 compensate for the injuries sustained to Plaintiff's business reputation and goodwill.
23 68. In doing the things herein alleged, Defendants acted willfully and with the
24 intent to cause injury to Plaintiff. Consequently, Defendants are guilty of malice and/or
25 oppression and/or fraud in conscious disregard of Plaintiff’s rights thereby warranting an
26 award of exemplary damages in an amount to punish Defendants and to deter others from
27 engaging in similar misconduct.
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1 SIXTH CAUSE OF ACTION


2 (Constructive Trust)
3 (Against all Defendants and DOES 1-5)
4 69. Plaintiff repeats and re-alleges the allegations contained in paragraphs 1
5 through 68, inclusive, and incorporates the same as though set forth in full herein.
6 Plaintiff is informed and believes and thereon alleges that Defendants, and each of them,
7 knowingly came into possession of revenue and financing rightfully belonging to
8 Plaintiff.
9 70. Plaintiff is informed and believes and thereon alleges that Defendants came
10 into possession of Plaintiff's property due to defendant's breaches of their respective
11 agreements with Plaintiff.
12 71. Plaintiff is informed and believes and thereon alleges that Defendants, and
13 each of them, were aware of the fact that the subject revenue, payments and commissions
14 rightfully belonged to Plaintiff.
15 72. As a proximate result of the wrongful acts of Defendants, and each of them,
16 Plaintiff has been damaged in an amount within the jurisdictional limits of this Court,
17 according to proof at trial.
18 73. Plaintiff is entitled to a constructive trust imposed upon Defendants, and
19 each of them, requiring Defendants to hold Plaintiff's revenue and financing in trust for
20 the benefit of Plaintiff.
21 WHEREFORE, Plaintiff prays for judgment against Defendants, and each of them, as
22 follows:
23 1. For general damages in the amount necessary to prevent the unjust enrichment of
24 Defendants, not less than $2,000,000.00, according to proof at trial;
25 2. For special damages in form of lost profits and good will, not less than $2,000,000.00,
26 according to proof at trial;
27 3. For punitive damages according to proof at trial;
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1 4. For the value of the property misappropriated, not less than $2,000,000.00, according
2 to proof at trial;
3 5. For attorney's fees and costs as allowable by law;
4 6. For prejudgment interest at the applicable legal rate;
5 7. For the value of the property converted, not less than $2,000,000.00, according to
6 proof at trial;
7 8. For an award of exemplary damages in an amount according to proof at the time of
8 trial;
9 9. For an Order requiring Defendants to show cause, if any, why they should not be
10 enjoined as hereinafter set forth, during the pendency of this action;

11 10. For a temporary restraining order, a preliminary injunction, and a permanent

12 injunction requiring Defendants and their agents, servants and employees, and all persons

13 acting under, in concert with, or for Defendants; and

14 11. For the imposition of a constructive trust; and

15 12. For such other and further relief as the court may deem just and proper.

16
17 DEMAND FOR JURY TRIAL

18 Plaintiff hereby demands trial by jury.

19
20
DATED: December 29, 2017________By: _/s/ Luke C. Zouvas
21 LUKE C. ZOUVAS, ESQ.
Attorney for Plaintiff and
22 In Pro Per
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