Writ of Mandamus Appendix by Santos Perez

United States Court of Appeals for the

Third Circuit Case No. 20-

EDITA APPLEBAUM Petitioner

On Review from the United States District Court for the District of New Jersey Civil Action No. 2:18-cv-11023-KM-JAD The Honorable Magistrate Judge Joseph A. Dickson United States Magistrate Judge The Honorable Judge Kevin McNulty United States District Judge

PETITIONERâ&#x20AC;&#x2122;s APPENDIX VOLUME I OF I PAGES 1 to 370

The Perez Law Firm

Santos A. Perez 151 W. Passaic St., 2nd Fl. Rochelle Park, NJ, 07662 (201)875-2266 Attorney for Petitioner www.NJLawCounsel.Com

TABLE OF CONTENTS Proposed Second Amended Complaint (Docket No 72) (D.N.J. filed May 5, 2019)…….……………………..……APP1

Certification of Santos A. Perez (Docket No 80) (D.N.J. filed May 10, 2019)…….………………………APP249 Probate Court Final Ruling Dated April 20, 2019 (Docket No 80) (D.N.J. filed May 10, 2019)…….………………………APP251 Transcript of August 12, 2019 Hearing (Docket No 89) (D.N.J. filed August 27, 2019)…….…………....………APP259 Plaintiff’s Litigation Privilege and RICO Standing Supplemental Brief (Docket No 90) (D.N.J. filed Sept 20, 2019)…….……………..………APP308* Defendant’s Litigation Privilege and RICO Standing Supplemental Brief (Docket No 93) (D.N.J. filed Oct 4, 2019)…….……...………...………APP348* Letter to Judge Joseph A. Dickson (Docket No 111) (D.N.J. filed Sept 11, 2020)….…….………..………APP368 *Rule 30(a)(2) Statement: The Briefs enclosed in the appendix were submitted since the issue to be resolved by this Court is not substantive, but rather procedural, i.e., did the petitioner comply with the Judge's August 12, 2019 directive regarding supplemental briefs, such as to warrant an order of mandamus requiring that the Magistrate and District Judges rule on the motions.

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IN THE UNITED STATES DISTRICT COURT DISTRICT OF NEW JERSEY

Edita Applebaum PLAINTIFF

Case No. 2:18-cv-11023-JLL-JAD

V. William P. Fabian, Laurence W. Gold, Thomas S. Howard, Esq., Gartenberg Howard LLP & Efraim “Frank” Rajs, Cecilia Keh, Thomas D’Ambrosio, Maxine Melnick, Leah E. Capece, & Michael Lackey, Gerald Macko, Derek Schumacher, Jimmy Samayoa, Garrett Applebaum , Youssef Abdulah Youssef, & Morey La Rue, Inc. Voya Financial, Inc., Intac Actuarial Services, Inc. Ascensus LLC, Susan Bauer, & John Does 1-10, ABC Corp 1-10, et al.

Judge: Hon. Jose L. Linares

PROPOSED SECOND AMENDED COMPLAINT AND JURY DEMAND FOR DAMAGES FROM RACKETEERING, CONSPIRACY TO ENGAGE IN A PATTERN OF RACKETEERING ACTIVITY, AND RELATED CLAIMS.

18 U.S.C. 1961 et seq.; 18 U.S.C. 1964

DEFENDANTS

TABLE OF CONTENTS General Allegations…..……………………..……………………..……………………………..7 Count I: RICO…….……..……………………..……………………..………………………....29 Predicate Act I: 400K Financial Transaction, After Decedent’s Death, Followed by Sun National Bank Fraud Lawsuit Which Nearly Caused the Demise of the Todd Harris Company ……………………..………………………...33 Predicate Act II: 2013 Conspiracy Bank Fraud; Admission of 2010 Bank Fraud; Extortion……………………..……………………..…………………………...44 Predicate Act III: 2013 Bank Fraud……………………..……………………..……...57 Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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Predicate Act IV: 602K Payroll Fraud……………………..…………………………..69 Predicate Act V: Theft 401(K) Funds Worth 100K……………………..………...……96 Predicate Act VI: Litigation Fraud, Fraudulent Concealment………………………....98 Predicate Act VII: Use of Toben Investments Inc. as a Shell Company for “No Show Salaries” And Other Financial Crimes; Firesale of Toben’s Sole Asset, the “Linden Commercial Property” under false pretenses………………………119 Count II: Common Law Fraud……………………..……………………..…………………...154 Count III: Defamation……………………..……………………..…………………………....158 Count IV: CEPA……………………..……………………..………………………………….165 Count V: 401K Theft State law Claim, Conversion……………………..…………………….196 Count VI: ERISA……………………..……………………..………………………………...198 Count VII: Intentional Infliction……………………..……………………………………….200 Count VIII: Tortious Interference……………………..……………………..……………..…205 Count IX: Common Law Negligence……………………..……………………………….…..208 Count X: John Doe Counts ……………………..……………………..……………………....209 Count XI: New Jersey Rico……………………..……………………..……………………....211 PROPOSED APRIL 2019 COUNTS: Count XII: SEC 10b-5 ……………………..……………………..……………………………212 Count XIII: Breach of Fiduciary Duty…….………………..……………………….………….215 Count XIV: Aiding and Abetting……………………..……………………..……….…………216 Count XV: Fraudulent Concealment……………………..……………………..….……….….219 Count XVI: Civil Conspiracy ……………………..……………………..…………………….246

Summary of Proposed April 2019 Amendments

Pursuant to West Run Student Housing Associates, LLC v. Huntington National Bank, 712 F.3d 165 (3d Cir. 2013).

1. Added Count XII, SEC Rule 10b-5 (17 C.F.R. 240.10b-5) - De Facto Seller theory 2. Added Count XIII, Breach of Fiduciary Duty - Defendant Fabian 3. Added Count XIV, Aiding and Abetting - Thomas S. Howard, Esq., Gold, Rajs, et als as defendants. Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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4. Added Count XV, Fraudulent Concealment (spoliation) - particularly as it relates to proposed defendant Thomas S. Howard’s latest brazen strategy in knowingly submitting his own certifications to the Chancery and Appellate divisions in late 2018 falsely claiming that the Sun National Bank 2013 fraud lawsuit was never filed. Said fraud lawsuit, which was in fact filed and served by competent counsel (Hill Wallack) , was the most significant event and the catalyst of nearly every act in the case sub judice. A Wells Fargo bank executive at his deposition in early 2018 characterized this Sun Bank lawsuit as a material fact which should have been disclosed - but was not. Mr. Howard is thus openly attempting to make this lawsuit disappear. 5. Added Count XVI, Civil Conspiracy - Thomas S. Howard, Esq., et als, as defendants. 6. New RICO Predicate Act: Count I, ¶335, incorporated Count XII, Rule 10b-5 Securities Fraud, as an additional litigation-based predicate act in furtherance of the RICO scheme to permit Mr. Fabian to pay himself his alleged indebtedness. 7. New RICO Predicate Act: Count I, ¶336 incorporated Count XV, Fraudulent Concealment, as an additional litigation-based predicate Act in furtherance of the RICO scheme to permit Mr. Fabian to pay himself his alleged indebtedness, making it clear that defendant Thomas Howard, Esq., is a significant participant in the post-suit fraud and fraudulent concealment, as well as a member of the RICO enterprise under the “separate accrual” rule.

8. Removed defendant Capece from “Tier 1” to “Tier 2” because of potential scienter issues. 9. Added the following utterance made by defendant Fabian at the June 27, 2013 “crisis meeting,” to Complaint, Preliminary Statement, ⁋9, “but if I drop dead, you know, I expect my family to be paid.” This utterance evidences Mr. Fabian’s intent or scienter Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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that the RICO scheme was for his own self-interests, not for THC or plaintiff’s benefit (as a beneficiary).

10. Added the executor’s current counsel, Thomas S. Howard, Esq. Gartenberg Howard, LLP, a s a party relative to the Fraudulent Concealment, Aiding and Abetting, and RICO Counts, as Mr. Howard has of recent knowingly made false statements in the appellate division (December of 2018), which resulted in a denial of the interlocutory appeal, and because of Mr. Howard’s knowing material misrepresentations in Probate Court since at least August of 2017 through present, which has resulted in plaintiff’s inability to achieve a monetary recovery or remove the executor for fraud.

11. Edited Count VI, ERISA, to clarify Mr. Fabian and Ms. Keh’s liability for aiding and abetting, and added allegation that the Voya/ING 401K plan may b e an ERISA Plan.

12. Added Morey LaRue Inc as a party relative to Predicate Act VII, Count I, ¶345, in that Morey LaRue fraudulently received most of the proceeds of the unlawful sale of the “Toben” Property.

Summary of November 12, 2018 Amendments (For informational purposes only) Amendments pursuant to West Run Student Housing Associates, LLC v. Huntington National Bank, 712 F.3d 165 (3d Cir. 2013).

1. Added Tolling and Litigation Privilege/Noerr Sham Exception allegations to all Counts. 2. Added further details(allegations) to Count VIII - Tortious Interference (e.g. 401K).

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3. Added further details (allegations) to Count II - General Common Law Fraud - e.g. 401K misrepresentation, “Conversion” of 401K funds, misrepresentation of payroll payments, etc.

4. Added Ascensus LLC as a party to the ERISA and common law 401K claims, as Intac was acquired by Ascensus circa July 2018.

Removed Count V, Title VII claims, changed Count V to 401K (Non-ERISA based) Common Law Negligence - Count implicates Cecilia Keh, Susan Bauer, Intac/Ascensus and ING/Voya.

Omitted RICO “Continuing Violation” Statute of Limitations paragraphs (Complaint ¶44-¶46), changed said paragraphs to reflect fraudulent concealment and duress as RICO tolling mechanisms.

7. Added allegations to RICO Count regarding RICO injury and RICO standing, -¶474 to ¶479.

8. Added ¶482 to ¶486 to Count I, entitled “Amendments to Predicate Act VI, ¶277 et seq. (Litigation Fraud)”, regarding October 2018 pleadings, January 2015 motion opposition papers, and Mr. Gold’s July 30, 2018 Certification (perjury).

9. General Allegations, edited ¶99 and ¶100 (Parties) to reflect that Voya and Intac are not

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members of the RICO Enterprise.

10. Changed all references from “motion to disinherit” to “pleadings” or “verified complaint” to disinherit, and clarified that the said pleadings encompassed a complaint filed in August of 2017, and a Complaint filed in October 2018, as well as (in some cases) motion opposition papers filed in January 2015 (which marks the first threat to disinherit plaintiff).

11. RICO STATUTE OF LIMITATIONS: Added allegations regarding Fraudulent Concealment, Duress, Plaintiff’s Due Diligence, Pendency of court Action, and a “New” RICO Pattern. Count I, ¶400 to 460.

12. RICO NOERR PENNINGTON: Added “Sham Exception” allegations. Count I, ¶461 473.

13. Edited the language and allegations regarding the 401K withdrawal in the context of RICO Predicate Act V. Count I, ¶229-236.

14. Count VI (ERISA) - As to defendant’s deferred compensation scheme, added a paragraph to reflect standing of plaintiff based on defendant’s failure to fund the trust and/or otherwise transfer to her the shares in the company. In addition, in the context of the ERISA 401K claim, clarified Keh’s liability as a “named” fiduciary, and Voya/Intac’s

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liability as a “functional” fiduciary.

15. CEPA, Count IV: Added Pierce Claim (Six Year Statute), Noerr-Pennington Sham Exception, and Tolling arguments Count IV, ¶76-124.

COMPLAINT Plaintiff Edita Applebaum brings this Complaint against defendants herein, and in support thereof alleges as follows:

1. This is a complex civil action for RICO remedies authorized by 18 U.S.C. 1961 et seq.; for actual, consequential and exemplary damages; and for all other relief which this honorable Court deems just and proper under all circumstances which have occasioned this Initial COMPLAINT. See 18 U.S.C. §§ 1964(a) and (c) (“Civil RICO”).

2. The plaintiff is a widow with three children who has not received a formal distribution from her late husband’s multi-million dollar estate, and his profitable companies, since he passed away nearly six years ago.

Instead, defendants have enriched themselves at her expense by engaging in the within RICO enterprise and the predicate acts of fraud plead herein, which enterprise and predicate acts continue unabated to date.

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4. The proofs are compelling and consist, inter alia, of lawful “wiretaps” and admissions of fraud by defendants, as well as the unbiased third party testimony of two independent bank executives taken in early 2018.

SUBJECT MATTER JURISDICTION

5. Subject matter jurisdiction is proper in this matter pursuant to the Racketeer Influenced Corrupt Organizations Act (“RICO”),

18 U.S.C. 1961 et seq.; 18 U.S.C. 1964.

This

Court has jurisdiction over the state law claims, infra, pursuant to 28 U.S.C. § 1367 et seq.

6. Jurisdiction is proper, notwithstanding pending State Court litigation, pursuant to

Marshall v. Marshall, 547 U.S. 293 (2006).

PRELIMINARY STATEMENT I. INTRODUCTORY COMMENTS: RICO 7. Defendants since November 4, 2012, have engaged in a RICO pattern of racketeering which includes bank fraud, payroll fraud, and litigation fraud, in order to deprive plaintiff, who is the late Todd Harris Applebaum’s wife and the mother of his three children, of millions of dollars due her pursuant to Mr. Applebaum’s last will and testament.

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8. The primary purpose of the RICO enterprise plead herein is the payment of defendant William P. Fabian’s disputed decades-old “loans,” as well as the payment of his alleged “consulting” fees stemming from an unorthodox “deferred compensation” scheme which lacks documentary proofs. See Count I, ¶200 (purported handwritten “ledger sheet” from the 1990’s depicting disputed “loans” and deferred “consulting” fees). II. PLAINTIFF’S LAWFUL WIRETAPS AND OTHER COMPELLING EVIDENCE OF FRAUD 9. The plaintiff at various times in the year 2013 lawfully recorded nearly ten hours of materially significant and incriminating statements made by the defendants (“wiretaps”). Said wiretaps included, inter alia, the following explicit admissions of fraud made by the executor of the estate of plaintiff’s late husband, to wit, defendant William P. Fabian:

We’re not reporting anything to anybody at the end of the day. I don’t know why I let you record this, but you better erase that part……..you know how Todd owes me all this money, right? If I put that on the corporate books, then Sun Bank would never have loaned us a dime or Wells Fargo. If I put that on the books now, Wells Fargo won’t make the loan. So I have to keep everything from me off the books, but if I drop dead, you know, I expect my family to be paid.

10. In addition, Mr. Fabian is heard in a recording made in June of 2013 uttering: “the books

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are boilerplate, we already now that, it’s boilerplate.”

11. Plaintiff’s “wiretaps” inter alia also included the following incriminating statement made by an attorney who has participated extensively in all pre-litigation conduct which gave rise to the within lawsuit, to wit, defendant Leah E. Capece, Esq.: “[t]here will be a lien which we will not record so that Wells Fargo can continue with the loan” .

12. Having uttered this statement attorney Capece subsequently prepared a promissory note/lien and annotated same with the phrase “NO UCC filing,” which was underlined for emphasis. (exhibit/graphic below of June 27, 2013 Promissory Note and Lien):

13. Defendant Laurence W. Gold then knowingly concealed this lien from Wells Fargo bank

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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in the course of procuring a quarter million dollar line of credit in late 2013.

14. In addition to numerous incriminating “wiretaps”, direct documentary evidence of the rampant fraud is plentiful, as depicted inter alia by the minutes of a December 9, 2012 meeting of the board of the Todd Harris Company (“THC”), prepared by defendant Leah E. Capece, Esq., and which included the following incriminating statement regarding the “Fabian payroll fraud”:

In addition, Fabian pointed out that his current salary of $104,000.00 is effectively the only way he was being repaid for the loans and previous consulting fees he was owed by THC.

15. There are no written instruments which impartially evidence these alleged “loans”, and there are absolutely no documents signed by the late Todd Harris Applebaum which corroborate their existence.

See Count I, ¶200 (purported handwritten “ledger sheet”

from the 1990’s depicting disputed “loans” and deferred “consulting” fees).

16.

Defendant Fabian is thus at liberty to misappropriate from the Estate of the late Todd Harris Applebaum any amount he so chooses.

17. Over one dozen depositions under oath taken during the pendency of the estate litigation in state court further corroborate the systemic fraud, and they also serve as the basis for Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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additional RICO counts regarding perjury.

III. DEPOSITION TESTIMONY OF TWO BANK EXECUTIVES TAKEN IN EARLY 2018 CONCLUSIVELY ESTABLISHES THAT DEFENDANTS COMMITTED BANK FRAUD 18. Particularly dispositive of the issues are the recent depositions of independent witnesses Kevin Harvey, a Wells Fargo Bank executive, as well as Deborah Heins, an accounts professional from Sun National Bank.

19. Both Mr. Harvey and Mrs. Heins testified at their depositions in early 2018 that the (nearly) half-million dollar “off the books” loans and “consulting” fees which the Todd Harris Company allegedly owed defendant William P. Fabian were never disclosed to the banks in connection with applications seeking half-million dollar commercial lines of credit (“LOC”).

20. In the case of Sun National Bank, which would later sue defendants herein, the commercial LOC would likely have been denied if defendants had not knowingly concealed these adverse Todd Harris Company financials.

IV. THE 2013 SUN NATIONAL BANK FRAUD LAWSUIT

21. Not having been informed of defendant Fabian’s disputed “loans”, in 2010 Sun National Bank granted the Todd Harris Company a commercial line of credit , and later sued the defendants in 2013 when they fraudulently withdrew nearly half a million dollars

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immediately after decedent Todd Harris Applebaum died, and before his last will and testament was probated in late 2012.

22. Among the allegations in the meritorious Sun National Bank complaint was that defendants forged the signature of decedent.

23. The named defendants in the Sun Bank fraud lawsuit were Frank Rajs, Cecilia Keh, The Todd Harris Company, and the estate of Todd Harris Applebaum (of which defendant Fabian was the executor.)

V. CONSPIRACY TO DEFRAUD WELLS FARGO IN MID-2013

24. In or about mid-2013, while in the process of seeking an “emergency” line of credit, defendants knowingly concealed from W ells Fargo bank M r. Fabian’s disputed “loans” and “consulting” fees, infra.

See Count I, ¶200 (purported handwritten “ledger sheet”

from the 1990’s depicting disputed “loans” and deferred “consulting” fees).

25. The primary participants in this conspiracy were William P. Fabian, Laurence W. Gold, CPA, and Leah E. Capece, Esq..

26. Defendant Leah E. Capece, at the time an attorney representing The Todd Harris Company and/or defendant William P. Fabian, in fact made it abundantly clear at a 2013 “crisis meeting” that a lien exceeding three hundred thousand dollars would be

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deliberately concealed from Wells Fargo bank in order to secure an “emergency” line of credit. Supra ¶11.

27. As stated supra at ¶13, defendant Laurence W. Gold indeed knowingly concealed this lien, and other adverse financials, in the course of procuring from Wells Fargo bank the quarter-million-dollar “emergency” line of credit circa September of 2013.

28. Mr. Gold also knowingly concealed from Wells Fargo numerous other relevant financials, including defendant Fabian’s disputed “loans” and “consulting” fees, Count I, ¶200, as well the the Sun Bank fraud lawsuit.

29. Unaware of this conspiracy to commit bank fraud, which would itself have resulted in a denial, Wells Fargo informally denied the commercial line of credit application by refusing to submit same to the underwriting department premised on, inter alia, the fiction of plaintiff’s refusal to provide a personal guarantee to the bank.

30. Specifically, Wells Fargo was unaware that plaintiff had already pledged her personal assets in a prior personal guarantee for the benefit of defendant William P Fabian, which she understood would not be disclosed to the bank.

31. Ergo, by executing a second personal guarantee, plaintiff would have been complicit in bank fraud - a concern she expressly communicated to defendant Laurence W. Gold in a series of emails, infra.

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VI. DEFAMATION OF PLAINTIFF AND HER UNLAWFUL DISCHARGE FROM THE TODD HARRIS COMPANY IN VIOLATION OF, INTER ALIA, CEPA; UNLAWFUL MOTION TO DISINHERIT PLAINTIFF BECAUSE OF HER WHISTLEBLOWER ACTIVITIES 32. After Wells Fargo refused to move forward with the quarter-million-dollar line of credit application, defendants defamed and financially harmed plaintiff by mischaracterizing the nature of the application process, which in fact had been based on a conspiracy to commit fraud, as a bona fide application process for a line of credit which was “denied” because of plaintiff’s refusal to provide a personal guarantee, notwithstanding that the submission of the personal guarantee by plaintiff would have been under false pretenses.

33. Specifically, defendant(s) spread the word within The Todd Harris Company - and in Court - that plaintiff was not a team player and would “destroy” the company since, they claimed, Wells Fargo “denied” the line of credit solely because of her failure to provide Wells Fargo with a personal guarantee.

34. However, Wells Fargo executive Kevin Harvey at his deposition stated that the line of credit would have been denied because of the conspiracy to commit bank fraud, and potentially because of Mr. Fabian’s disputed “off the books” loans and “consulting” fees, Count I, ¶200, if same had been disclosed.

35. Mr. Harvey at his deposition in early 2018 was also “absolutely” confident in stating that if defendant Gold had not knowingly concealed the Sun Bank fraud lawsuit, the line of

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credit application process would have been short-circuited for that reason alone.

36. As a direct result of defendant’s false statements, plaintiff on December 4, 2013 was fired from a job she held at her former husband’s company, was escorted from the premises by a police officer, and was subsequently threatened by way of a vexatious state court motion which sought her complete disinheritance in the form of the firesale of her minority non-controlling stake in the Todd Harris Company.

37. These facts form the basis of the defamation, discrimination, and whistleblower claims infra.

II. V DAMAGES AS THEY RELATE TO THE FIRE SALE OF THE LUCRATIVE TOBEN COMMERCIAL PROPERTY 38. Nearly six years after the passing of Mr. Todd Harris Applebaum, plaintiff and her daughter have yet to receive a formal distribution from his multi-million dollar estate. Instead, the defendant William P. Fabian, attorney Leah Capece, Esq., as well as the other defendants, particularly defendant Laurence W. Gold, have all profited by engaging in the RICO payroll scheme supra.

39. In addition to plaintiff’s lost inheritance for six years, defendants have also caused significant prospective financial damage to plaintiff.

40.

Among the more significant prospective financial losses was the 2014 “firesale”, at

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nearly half of the appraised value of one and a half-million dollars, of a lucrative and profitable commercial property of which plaintiff would have been a 51% owner since 2012 (the “Toben” property, graphic/illustration of appraisal and deed below):

41. The haphazard “fire sale” of the Toben property, as well as the misappropriation of its profits from 2012 through 2014 by way inter alia of fraudulent payroll payments to Mr. Fabian and other third parties, was undertaken through false pretenses and directly resulted from defendant Fabian’s RICO scheme to pay himself his disputed “loans” and “consulting” fees, Count I, ¶200.

42. The 2014 “Toben” property sale proceeds were also used to pay additional sums to defendant Fabian, which indebtedness may have resulted from widespread and significant fraud Mr. Fabian had engaged in prior to the death of plaintiff’s late husband, e.g., the “Morey La Rue” mortgage infra. Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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43. The proofs further indicate that the “Toben” corporate entity was used as a shell company for extensive money laundering, and may have been used by defendant William P. Fabian for tax evasion and other financial crimes. VIII. TOLLING OF STATUTE OF LIMITATIONS 44. The Statute of Limitations for the RICO and other causes of action, as set forth infra, was tolled by way of defendant’s outrageous and egregious acts of fraudulent concealment and duress, and by the pendency of the State Court action.

45. By way of example, plaintiff was consistently told by Mr. Fabian, after the filing of the complaint in April of 2014, that the fraudulent payroll payments were not being paid, as he was allegedly receiving a bona fide salary for actual work performed.

46. Another instance, which constituted duress, consisted of the firing of plaintiff from THC as a “warning” for her not to engage in whistleblower activity, and the subsequent filing of patently frivolous pleadings (in August of 2017 and October of 2018) to completely disinherit plaintiff in order to compel her to stop her whistleblower activity in the form of lawsuits and statements she made regarding the rampant fraud at THC.

IX. PENDING STATE COURT LITIGATION 47. This matter is currently the subject of limited litigation in the Superior Court of New

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Jersey, Middlesex County, Chancery Division, Probate Part, titled “In Re Estate of Todd Harris Applebaum”, Docket 238799.

48. Said litigation, which continues in the discovery phase as of the date of the filing of the within pleadings, began with a verified complaint and order to show cause filed circa March of 2014.

49. The primary purpose of the state court litigation has been equitable - the removal of defendant William P. Fabian as executor of the estate of her late husband, as well as the transfer of Todd Harris Company shares and other assets to plaintiff.

50. Although there are quasi-fraud claims pending in State Court, they are based on a limited tort - breach of fiduciary duty by Mr. Fabian as executor and breach of fiduciary duty by Mr. Frank Rajs as trustee of a testamentary trust.

51. This severely limited “fiduciary” cause of action does not adequately apportion damages among all potential defendants, and they do not properly make the plaintiff whole, particularly because most of the damages paid by defendant Fabian as executor will be paid from Estate funds - thereby damaging plaintiff further.

52. The primary purpose of the litigation in this Honorable Federal Court is to ascertain and apportion damages among all potential defendants in order to make plaintiff truly whole, by requiring all legally culpable defendants to pay damages individually and not as

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fiduciaries of the estate of plaintiff’s late husband.

53. Thus all damages sought in the within RICO suit are not from the Estate corpus, but rather from the coffers of defendants individually, the Estate and the Estate Corpus will play no role in the Federal RICO litigation.

54. Moreover, the State probate court has no jurisdiction over most of the legally culpable defendants, and it cannot award damages for the rampant litigation fraud committed by defendants in that same court, thus necessitating a separate cause of action which permits recovery for all forms of fraud against any and all legally culpable defendant(s).

55. The state probate court also lacks jurisdiction over the RICO and CEPA claims, and cannot award treble or punitive damages.

56. Because of these jurisdictional restrictions the plaintiff has been unable to obtain proper relief, and cannot be made whole in State Court.

57. This is particularly pressing as plaintiff has received no monetary distribution from her late husband’s estate in the nearly six years since his passing.

58. In the court’s docket below is also an undecided motion to sequester defendant Leah E. Capece from all depositions, which was filed circa August of 2017 and, as of the date of the filing of the within complaint, has not yet been decided, thus resulting in a severe

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handicap in plaintiff’s ability to obtain discovery.

59. In addition, contemporaneously with the filing of the within RICO complaint, a motion was filed in State Court requesting the removal of William P. Fabian as executor, Leah E. Capece as attorney for the Todd Harris Company, and Laurence W. Gold as company accountant.

60. Given the foregoing, it is respectfully submitted that the proper forum for resolution of monetary damages is this Honorable Court, pursuant to Marshall v. Marshall, 547 U.S. 293 (2006), and once damages are properly apportioned among all defendants the only remaining matters in the State Probate Court will be equitable, to wit, to appoint a new executor/administrator, issue a final accounting, distribute the assets, and close the estate.

PARTIES 61. The plaintiff, Edita Applebaum, was married to decedent Todd Harris Applebaum for nearly twenty two years until his passing on November 4, 2012. She is also the mother of his three children.

62. Plaintiff was a “residuary” beneficiary under Mr. Applebaum’s purported last will and testament, as well as a beneficiary of a testamentary trust.

63. As of the date of the filing of the within complaint, plaintiff has received no formal

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distribution from the estate of her late husband, who passed away in 2012.

64. Plaintiff’s daughter, who is under the care of plaintiff, has received no distribution from her father’s estate despite nearly six years of estate administration by defendants.

65. The primary “tier 1” defendants in the case sub judice are William P. Fabian and Laurence W. Gold, CPA.

66. Mr. William P. Fabian is the executor of Todd Harris Applebaum’s estate and the principal of the RICO enterprise, which was formed to facilitate payment of disputed, undocumented, and potentially illicit “loans” and “consulting” fees purportedly owed him by Mr. Applebaum and/or The Todd Harris Company (“THC”).

There are no

instruments evidencing these decades-old loans, and absolutely not one document signed by the late Todd Harris Applebaum evidencing same.

67. Mr. Laurence W. Gold, is a certified public accountant who knowingly concealed from Wells Fargo and Sun National banks numerous adverse Todd Harris Company (“THC”) financials, including defendant Fabian's disputed “loans” and “consulting” fees, while soliciting commercial lines of credit exceeding or equal to a quarter-million-dollars.

68. Mr. Gold likely also knowingly failed to make financial disclosures to Valley National Bank, as well as other banks, in the course of procuring “emergency” funds circa June 2013 on behalf of THC and/or on behalf of defendant William P. Fabian.

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69. Mr. Gold’s articulated reasons for the commission of this bank fraud, involving a quarter-million-dollar commercial line of credit, fits squarely within the purposes of the RICO enterprise alleged herein, as set forth in an email he sent plaintiff on July 4, 2013, in which he articulated the RICO “plan”, to wit, “[r]egarding Wells Fargo, the plan was to substitute the monies owed to Bill Fabian with the monies advanced under a credit line with Wells Fargo Bank.”

70. The secondary “tier 2” defendants in the case sub judice are Leah Capece, Esq., Efraim “Frank” Rajs, Cecilia Keh, Thomas D’Ambrosio, and Maxine Melnick.

71. Leah E. Capece, Esq., has been defendant William P. Fabian’s attorney since November of 2012, purporting to represent THC and other entities or persons, when in reality she only advocated for Mr. Fabian, who was also responsible for payment of her fees pursuant to a retainer agreement signed by Mr. Fabian and Ms. Capece in or about November of 2012.

72. Among the most significant “tier 2” defendants is Mr. Frank Rajs a/k/a Efraim Rajs who, within days after the passing of Mr. Todd Harris Applebaum in November of 2012, and prior to probate of his will, “accepted” a fifty thousand dollar (50%) per annum salary raise as an employee/officer of the Todd Harris Company.

73. Mr. Rajs “accepted” this raise notwithstanding that the company was insolvent as

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depicted, inter alia, by the (nearly) half-million dollar fraudulent withdrawal of funds from a Sun National Bank line of credit immediately after the passing of Mr. Applebaum in late 2012.

74. This bank fraud resulted in a lawsuit by Sun National Bank, and the near-collapse of the Todd Harris Company, in mid-2013.

75. Mr. Rajs (pronounced “rice”) was a named defendant in the Sun National Bank suit, and defendant William P. Fabian at his deposition admitted that Mr. Rajs was in fact liable for the fraudulent withdrawals which led to the litigation.

76.

At his deposition, Mr. Fabian further admitted that defendant Rajs is “second only to [Todd Harris Applebaum]”.

77. As such, Mr. Rajs is pivotal as regards the significant business decisions within the Todd Harris Company, and he was aware, or should have been aware, of the scope of the rampant payroll fraud committed by the “tier 1” defendants.

78. Mr. Rajs in fact ratified or approved the payroll fraud as a member of the RICO enterprise, and he acted in concert with the “tier 1” defendant(s) to facilitate said payroll fraud, including concealing same from the state court after a lawsuit was filed by plaintiff circa April of 2014.

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79. Defendants Cecilia Keh and Thomas D’Ambrosio are intimately involved in the financials of defendant Todd Harris Company, Inc. (“THC”). Ms. Keh was also a named defendant in the fraud lawsuit brought by Sun National Bank circa 2013.

80. Defendant Thomas D’Ambrosio, inter alia, participated in a scheme to conceal from plaintiff the rampant fraud occurring at THC in order to sabotage her whistleblower activities.

81. Defendant Maxine Melnick notarized various questionable documents and instruments in this case, and has no record of same. Inter alia, she has known defendant William P. Fabian for over thirty years and knows, or should have known, of the extent of his myriad fraudulent activities, which span more than three decades.

82. In notarizing the questionable instruments, particularly an employment agreement purportedly permitting Mr. Fabian to be THC’s paid “consultant”, and which bears compelling indicia of fraud, defendant Melnick participated in, ratified, or otherwise acted in furtherance of the stated goals of the RICO enterprise, to wit, to siphon funds from THC and Mr. Applebaum’s estate in order to pay defendant William P. Fabian’s disputed “loans” and “consulting” fees.

83. The Todd Harris Company, Inc. (“THC”), not a named party, is based in Edison, New Jersey, and was incorporated by plaintiff’s late husband in the late 1980’s. It is the late Todd Harris Applebaum’s profitable flagship company, and grossed over twelve million

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dollars in the year 2012 alone.

THC is also an estate asset in the underlying State Court

litigation. Its primary business is the sale and installation of swimming pools and related supplies and equipment.

84.

The current president of THC is plaintiff’s son, Benjamin Applebaum (not a named party). However, at the time most of the fraud occurred, defendant Frank Rajs was the president of the company, and ran same with assistance from defendant William P. Fabian.

Mr. Fabian at his deposition in fact indicated that Mr. Rajs “leans heavily” on

him for support. As such, Mr. Fabian and Mr. Rajs are both the de facto heads of THC and continue to manage same in all aspects. They are therefore both knowledgeable regarding the rampant fraud committed by the RICO enterprise.

85.

Toben Investments, Inc., not a named party, is a New Jersey company used by the defendants as a shell company for money laundering and other financial crimes, which the evidence suggests includes tax evasion, embezzlement, and payroll fraud, infra. It was incorporated by plaintiff’s late husband, Todd Harris Applebaum, in early 2011 and was owned 51% by himself, and 49% by his son.

86. In or about October of 2011, Toben purchased a commercial building at a “firesale” from a company called “Morey LaRue,”

itself a potential “shell company” owned by

defendant Fabian in law or equity.

This purchase, as discussed infra, contained

compelling indicia of fraud, as buttressed by a statement made by an appraiser that the transfer was a “transfer of convenience,” infra.

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87. After the passing of Mr. Applebaum in 2012, the Toben commercial property was appraised at over one million dollars and in 2014 defendant Fabian sold it to the tenants of the building, who were also his previous business acquaintances, at half of the appraised value.

88. Defendant Fabian received the bulk of the Toben property sale proceeds as per the RICO enterprise plead herein.

89. The tertiary “tier 3” defendants are collectively called the “affiants”, to wit, Michael Lackey, Gerald Macko, Derek Schumacher, Jimmy Samayoa, Garrett Applebaum, and Youssef Abdulah Youssef.

90. These defendants were among a group of THC employees who submitted affidavits, prepared by defendant Leah E. Capece, Esq., which literally characterized plaintiff as capable of “destroying” her late husband’s company.

91. The affidavits were prepared a few months after plaintiff was discharged from the company with the aid of a police escort - although plaintiff did not harass or otherwise disturb the peace in a criminally culpable way- and were meant to justify the unlawful firing as well as the presence of the police.

92.

The affiants thus wanted plaintiff fired from her late husband's company for the

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following non-exhaustive reasons: she stared at one employee, she suggested changes to the gas receipts policy - in order to prevent fraud, she stood in front of the time clock to greet and meet the employees, and other similar acts.

93. Defendant William P. Fabian, in a separate affidavit claimed that such salutary or otherwise benign acts had the potential of “destroying” the company.

94. Defendant Fabian made these remarks about plaintiff in the context of a motion which sought to use the employee affidavits, supra, to sell her 40% non-controlling stake in the Todd Harris Company at discount, as discussed infra Counts I and IV.

95.

At his deposition defendant Fabian acknowledged that plaintiff could not “control” (much less “destroy”) the company with a 40% ownership interest, and he left absolutely no doubt that his primary concern in selling her shares was her State Court fraud lawsuit filed circa March of 2014.

96. The affiants, as well as defendant Fabian, also made statements which suggested whistleblower animus, misogyny, anti-semitism, and racism, infra.

97. As such, the relevance of the "affiants" in this case is twofold: they substantiate the whistleblower and discrimination claims, and they serve as proofs that the affiants colluded with defendants William P. Fabian and Leah E. Capece in order to advance the interests of the RICO enterprise.

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98. Voya Financial, Inc., was a financial services company into which a 401K plan belonging to the late Todd Harris Applebaum was rolled over, and which then permitted the unlawful withdrawal of the 401K funds by defendants, in the amount of one hundred thousand dollars, in lieu of disbursing those funds to the lawful beneficiary, Edita Applebaum, plaintiff herein. It is not alleged in this complaint that Voya was a member of the RICO Enterprise.

However, if further discovery reveals otherwise, plaintiff

reserves the right to move to amend the complaint accordingly.

99. Intac Actuarial Services, Inc., was the third party administrator at the time the 401K funds were unlawfully withdrawn by defendants. Intac was acquired by defendant Ascensus LLC in July of 2018. It is not alleged in this complaint that Intac was a member of the RICO Enterprise. However, if further discovery reveals otherwise, plaintiff reserves the right to move to amend the complaint accordingly.

COUNT I. RICO I. GENERAL RICO ALLEGATIONS 1. The plaintiff repeats and realleges the foregoing allegations supra, ¶1-99, as if fully set forth herein.

2. This RICO matter stems from the untimely passing of plaintiff’s husband of nearly

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twenty two years, Mr. Todd Harris Applebaum, on November 4, 2012.

Mr. Applebaum was the sole owner of The Todd Harris Company, Inc., (“THC”) and a 51% owner of Toben Investments, Inc. (“Toben”).

4. The Todd Harris Company, a pool installation and supplies company based in Edison, NJ, grossed over twelve million dollars in the year 2012 alone.

5. Toben Investments Inc., a “shell” company based in Edison, NJ, was the owner of a profitable commercial property situated in Linden, NJ, with rental income of approximately 300K per annum (“Linden Property”).

6. After Mr. Applebaum’s passing, the defendants created, expanded, managed, and/or modified a potentially pre-existing RICO enterprise which subsisted on systemic bank fraud, money laundering, tax evasion, use of shell companies, common law fraud, mail fraud, wire fraud, perjury, embezzlement, litigation fraud, as well as other financial crimes, in order to inter alia assist defendant William P. Fabian in the payment of a series of “off the books” investments he allegedly took part in with the late Todd Harris Applebaum and the Todd Harris Company.

7. Inter alia, d efendants relied upon shell companies to commit financial crimes.

Morey

LaRue, Inc., and Toben Investments, Inc., are two such companies which were created or used as shell companies for the commission of financial crimes.

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8. Defendants also frequently relied on the use of

fraudulent instruments, such as

“employment agreements” (“EA”), which generally guaranteed the beneficiary a payroll payment and a fictitious permanent job, when in reality the EA was nothing more than a vehicle for money laundering. Thus, the EA’s permitted the use of a company’s payroll account to transfer large sums of money from one party to another over some specified period of time, often in repayment of illicit “off the books” accounts which had already “accrued”.

In the case sub judice, there are at least two such EA’s in question, the “Fabian EA” and the “Rajs EA”.

10. The Fabian EA, which contains compelling indicia of fraud, was used to commit the payroll fraud and money laundering described infra.

11. The “Rajs EA” also contains compelling indicia of fraud within its four corners, including the payment of a purported one million dollar payout from the Todd Harris Company’s bank accounts in the event of the passing of defendant Frank Rajs (in lieu of a standard life insurance policy paid for by the company).

12. It is further believed that Mr. Fabian used other similar EA’s during his tenure at shell company Morey LaRue Inc., in order to inter alia hide his ownership interest in that company.

Morey LaRue, Inc., is a relevant entity in this case in that it transferred the

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lucrative “Linden” commercial property to Toben Investments, Inc., which property was then sold after the passing of Mr. Applebaum at half of the appraised value of more than one million dollars, infra.

13. Another tactic used by the defendants in their RICO scheme was to hire accountants and attorneys, and to delegate to these professionals traditional and non-traditional tasks, in order to use the attorney/client privilege as a shield, and in the case of the accountant in order to give false assurances of the propriety of the transaction.

14. In the case sub judice defendant Laurence W. Gold, CPA, acted as an agent on behalf of the Todd Harris Company, and procured at least two commercial loans through false pretenses.

15. Defendant attorney Leah E. Capece in turn was used for virtually every purpose, including inter alia as a human resources manager, as spokesperson, as transactional counsel, and for estate-related work, which included document preparation. She often represent multiple parties with clear conflicts of interest - at all times being faithful to defendant William P. Fabian only, as in the case of her representation of Mr. Fabian and Toben Investments Inc. in a transaction which benefited only defendant Fabian and which resulted in the sale of the “Linden” commercial property at one half the appraised value of one and-a-half million dollars, thereby harming her client, Toben Investments, and ultimately plaintiff, who would have inherited 51% of Toben shares and its assets absent the RICO scheme.

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16. Plaintiff was a 40% beneficiary of the Todd Harris Company (“THC”) shares pursuant to the “residuary” clause of her late husband’s last will and testament. She also had a 15% interest in a testamentary trust which was itself bequeathed the remaining 60% of THC shares, thus resulting in a total of 55% stake of direct and indirect ownership of THC by plaintiff.

17. The late Todd Harris Applebaum’s unequivocal intent in bequeathing plaintiff a 40% ownership stake in THC by way of the “residuary” clause was made clear, inter alia, in the testimony of financial consultant/lawyer Paul Cavice Jr., Esq., the drafter of Mr. Applebaum’s alleged last will and testament. Thus, at his October 2016 deposition, when asked if “he convinced [Todd Harris Applebaum] to give [plaintiff] 40 percent of the stock” ,

Mr. Cavise answered “[y]eah, right or wrong, we did… [Mr. Applebaum]

agreed, of course….he signed the will.”

II. PREDICATE ACT I BANK FRAUD, COMMON LAW FRAUD, MONEY LAUNDERING, WIRE FRAUD, MAIL FRAUD: SUN NATIONAL BANK WITHDRAWAL USING FORGERY, FRAUD LAWSUIT BY SUN NATIONAL BANK. (i). Suspicious financial activity prior to probate of Mr. Applebaum’s will: Salary Raises and Fraudulent withdrawal of Four Hundred Twenty Thousand Dollars from Sun National Bank circa November and December of 2012 18. Within days of the passing of Mr. Todd Harris Applebaum on November 4, 2012, and prior to probate of his alleged last will and testament, defendant Frank “Efraim” Rajs gave himself or “accepted” a fifty thousand dollar per annum salary raise, as well as a Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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promotion to president of The Todd Harris Company (“THC”), and he also “agreed” to place defendant Fabian on the THC payroll at a rate of two thousand dollars per week.

19. Subsequently, along with defendants Cecelia Keh and others, Mr. Rajs in three separate transactions withdrew $420,000.00 from a Sun National Bank line of credit belonging to THC.

He did so with the approval of defendant Fabian as executor of the estate of Todd

Harris Applebaum, who was also the interim owner of THC and Toben (51% owner).

20. The illicit Sun National Bank withdrawal(s) led to a fraud lawsuit, the near insolvency of THC, and subsequently a pivotal June 27, 2013 “crisis meeting” which was attended by numerous parties, including defendants Gold and Capece, at which meeting they openly discussed more than one conspiracy to commit fraud and they also candidly admitted they had in fact committed fraud in the solicitation of the Sun Bank line of credit in 2010.

(ii). June 25, 2013 Fraud Suit by Sun National Bank Against Defendants; Allegations 21. The Sun Bank fraud suit was filed on or about June 25, 2013, two days before the June 27, 2013 “crisis” meeting in which defendants openly discussed various conspiracies to commit fraud.

22. The fraud suit alleged, and the plaintiff repeats and avers in the within RICO complaint, that the very passing of Mr. Applebaum rendered the Sun Bank withdrawals per se fraudulent (verbatim Sun Bank suit allegation below) :

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As [Mr. Applebaum] had passed away on [November 4, 2012] which represents an event of default in accordance with the terms of the Loan Agreement, THC was prohibited from taking additional advances under the Line of Credit Note, as there could be no event of default under the Loan Agreement as a condition precedent to any advance.

23. However, the suit then alleged, and the plaintiff hereby also avers and alleges in the within RICO complaint, that Todd Harris Applebaumâ&#x20AC;&#x2122;s signature had also been forged in numerous documents (verbatim Sun Bank suit allegation below) :

Notwithstanding that THC was prohibited from taking any additional advances pursuant to the terms of the Loan Agreement, on November 26, 2012, THC, through Keh and/ or with the knowledge of Rajs requested and received a drawdown of $150,000.00. The Borrowing Base Certificate contained the forged signature of Harris who had been dead for three weeks.

24. The suit further alleged, and the plaintiff hereby alleges and avers in the within RICO complaint, as follows (verbatim Sun Bank suit allegation below):

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On December 14, 2012, Keh fraudulently requested through her December 14, 2012 email to Sun a drawdown of $70,000.00 on behalf of THC when she knew that Harris had been dead for over five weeks and which monies were funded in reliance thereon.

25. The fraudulent withdrawals, including the forgery, which began shortly after the death of Mr. Applebaum, extended into early 2013, pursuant to a Sun Bank allegation which the plaintiff hereby sets forth and repeats as an allegation in the within RICO complaint (verbatim Sun Bank suit allegation below) :

Sun was presented with a Bank Resolution By Corporation dated January 1, 2013, which had the forged signature of Harris on it along with the signature of Keh and Rajsâ&#x20AC;&#x2039;.

26. Sun Bank also alleged, and the plaintiff hereby avers and repeats as part of the within RICO complaint, that the alleged instances of bank fraud constituted another event of default under the loan agreement (verbatim Sun Bank suit allegation below) :

The fraudulent conduct by THC, and those acting on its behalf, including Keh, Rajs and John Does 1-5, by among other things, making draw requests, receiving draws under the Line of Credit Note and Loan Agreement and presenting documents pursuant to

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the terms of Loan Agreement with the forged signature of Harris was false and misleading and constitutes an event of default under the Loan Agreement, Line of Credit Note and Security Agreement.

27. In total, per the allegations in the Sun Bank lawsuit, which plaintiff repeats and avers in the within RICO complaint, $420,000.00 was fraudulently withdrawn by defendant Cecilia Keh in three different transactions, to wit (verbatim Sun Bank suit allegation below):

On November 26, 2012, Keh requested a drawdown of $150,000.00 on behalf of THC by a forged Borrowing Base Certificate when she knew that Harris had been dead for over three (3) weeks…….On December 3, 2012, Keh requested a drawdown of $200,000.00 on behalf of THC by a forged Borrowing Base Certificate when she knew that Harris had been dead for over four (4) weeks…...On December 14, 2012, Keh requested through her December 14, 2012 email to Sun a drawdown of $70,000.00 on behalf of THC when she knew that Harris had been dead for over five (5) weeks.

28. Sun Bank further alleged, and plaintiff now repeats and avers in the within RICO complaint, that the foregoing transactions, inter alia, constituted common law fraud by defendants Keh and Rajs: “[s]uch actions by Keh constitute common law fraud” and Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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“[s]uch actions by Rajs constitute common law fraud.”

29. The Sun National Bank suit also alleged the participation of a “John Doe”, which defendant William P. Fabian indicated may include himself.

Specifically, at his

deposition, while discussing statements he had made at the “crisis” meeting regarding potential criminal charges and the hiring of criminal defense counsel, Mr. Fabian stated: “[a]nd they’re threatening to file criminal charges against Frank and Cecilia and John Does… which can be any one of us here.”

30. Defendant Leah Capece at the June 27, 2013 “crisis meeting”, infra, in fact admitted that the decedent’s signature was forged. Specifically, she uttered “[t]hey're claiming it was fraud because they [in fact] signed the paperwork after Todd died..”

31. Defendant William P. Fabian at his September 7, 2017 deposition also admitted liability for the Sun National Bank fraud, and he further inculpated defendants Frank Rajs, Cecilia Keh, and THC management in general:

Q. That's fine. Line 6, page 16 [of the crisis meeting transcript]. This is Mr. Fabian speaking: "Let me stop you again. [Leah Capece, Esq] has worked more than 10 hours a day to try and resolve the Sun Bank situation since Tuesday. That's why she's doing the talking and not me. She's physically been there, met with these people, done all kinds of crazy stuff to try and get us out of this pickle that we've got ourselves in." Q. Does "we" include you? A. "We" refers to the company. Q. Does that include you? Now, "we" is more than one person, Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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correct? A. I mean the Todd Harris Company. I'm including everyone involved with the Todd Harris Company management. Q. Did you include yourself? A. I guess so. ……. Q. Did Frank make a mistake? A. When? Q. When he got the company in the pickle? A. Could you be more specific? Q. You stated back on June 27, 2013, that, "We got ourselves in a pickle." Out of deference to counsel not to get into colloquy again, your testimony now is that Frank is part of that? Frank Rajs. A. Yes; and Cecilia.

32. However, at his deposition defendant Fabian made it clear that he had managerial authority within THC, which was an estate asset he controlled by virtue of his full ownership of its shares as the executor.

33. Defendant Fabian at his deposition thus stated that THC’s president at the time, defendant Frank Rajs, “leans extensively” on him and “uses” him “heavily” with regards to THC operations:

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A. [Rajs’] knowledge was second only to Todd's. Q. Was he able to run the company by himself? A. He leaned on me extensively for consulting services. Q. For consulting services? A. Or advice. …. Q. So, what did he lean on you for? What service? What advice did you give him?

A. Management advice; advice regarding running the company, advice regarding sales, advice regarding all facets of the company.

Q. Didn't you state that Frank was able to run the company by himself? …... A. What I said was that he was the most capable next to Todd and that he had leaned on me and used me heavily to help him run the company. Q. Leaned on you heavily? A. Not lightly.

34. The foregoing testimony, taken under oath, clearly sets forth the following proposition: defendants Frank Rajs, Cecilia Keh, and William P. Fabian, acting in concert as part of Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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an “enterprise”, deliberately and fraudulently withdrew nearly $420,000.00 immediately after Todd Harris Applebaum’s passing, and prior to probate of his will, by inter alia forging his signature in the process.

(iii) The Financial Consequences of the Sun Bank Fraud Lawsuit - Actual and Consequential Damages suffered by THC and plaintiff 35. These fraudulent withdrawals, as stated supra, came on the heels of a 50% salary raise by Rajs within days of the passing of Mr. Applebaum, as well as the formal “hiring” of Mr. Fabian as a THC employee with a two thousand dollar weekly salary. As discussed infra, Fabian’s employment at THC was a sham, and part of a scheme to pay himself decades-old and undocumented indebtedness allegedly due him.

36. As stated throughout this RICO complaint, the primary purpose of these influx of funds into THC’s coffers by false pretenses was the payment of disputed, undocumented, decades-old “loans” allegedly owed Mr. Fabian by THC, as well as the payment of Mr. Fabian’s illicit “deferred compensation” in the form of “consulting” fees the company allegedly owed him for “consulting” purportedly performed between 2008 and 2012, and prior to the passing of Mr. Applebaum. See Count I, ¶200-202.

37. Because of the shortage of funds required to immediately pay this illicit indebtedness, and fearful that the company would soon collapse because of the Sun Bank lawsuit (thereby preventing payment of this illicit debt), defendants - led by Mr. Willam P. Fabian - undertook further efforts to sell other profitable assets belonging to the late Todd

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Harris Applebaum.

38. One such asset which was haphazardly disposed of in order to satisfy the disputed debts purportedly owed Mr. Fabian was the profitable “Toben” commercial property, which was sold at a “fire sale” for approximately one half of the recently-appraised market value of nearly one and a half million dollars.

39. The pretext used for the sale of the said profitable Toben commercial property was that it would eventually be a worthless asset, particularly given the alleged environmental damage they fraudulently claimed to be present at the premises. Defendants also claimed that the property would burden the financial resources of the Todd Harris Company and/or the estate of the late Todd Harris Applebaum. Given that the company had just lost its Sun Bank line of credit, defendants they further claimed it was particularly necessary for the fire sale to take place in order to keep the company afloat notwithstanding that the property was profitable at the time of the sale and not a burden on the estate or THC.

40. However, the Todd Harris Company from 2012 to present has remained profitable, without a line of credit, and nothing in the proofs compels the conclusion that the Toben property would have significantly depreciated in value or become less profitable. In fact, the Toben property would have likely increased its profit margins through annual rent increases as well as through the payment of the “Morey La Rue” mortgage which encumbered same, infra.

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(iv) Settlement of the Sun Bank Lawsuit through false pretenses and/or through the commission of further fraud 41. The Sun Bank lawsuit was eventually settled on or about June 28, 2013, after the June 27, 2013 “crisis meeting”, infra.

42. The settlement of the Sun Bank suit itself was replete with rampant fraud, and/or served as the precursor for further RICO predicate acts.

43. Defendant Leah E. Capece, Esq., who at the time represented defendant William P. Fabian as executor, also represented THC during the settlement negotiations of the Sun Bank fraud lawsuit, in the process remaining loyal to Mr. William Fabian only - as depicted by the fraud she engaged in to effectuate the settlement, infra (concealment of “bailout” lien from Well Fargo).

44. Thus, in order to settle the Sun Bank lawsuit defendants needed an additional source of funds. Eventually, as seen infra, and after a lengthy bank fraud discussion, the parties decided that Mr. William Fabian would finance THC’s bailout with his own personal funds. However, as a condition precedent to this bailout, he demanded the following instruments: plaintiff’s personal guarantee, a lien on THC accounts receivables, and a promissory note executed by THC.

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45. As discussed infra, in order to effectuate this settlement, Leah Capece and Mr. Fabian, with Rajs and Laurence W. Gold in attendance, at the June 27, 2013 “crisis meeting” conspired to conceal the entirety of this nearly three-hundred-thousand dollar “bailout” transaction from Wells Fargo bank in order to secure a quarter million dollar line of credit (LOC).

46. In conformity with this bank fraud scheme, defendant Laurence Gold indeed procured a LOC from Wells Fargo, in the process knowingly concealing the following items, any of which would have resulted in a denial: (1) the Sun Bank lawsuit (2) Mr. Fabian’s nearly half-a-million dollars “off the books” loans and “consulting” fees allegedly owed him by THC, (3) Mr. Fabian’s liens on THC assets and THC’s nearly 300K indebtedness to Mr. Fabian which resulted from the THC bailout and (4) plaintiff’s personal guarantee to Fabian she had executed as additional security for the bailout funds he had advanced.

III. PREDICATE ACT II - CONSPIRACY TO COMMIT BANK FRAUD, EXTORTION: CRISIS MEETING OF JUNE 27, 2013 - DEFENDANTS OPENLY DISCUSSING A CONSPIRACY TO COMMIT BANK FRAUD AND ADMITTING TO A RELATED BANK FRAUD WHICH TOOK PLACE IN 2010; EXTORTION OF NEARLY THREE HUNDRED THOUSAND DOLLARS FROM PLAINTIFF

(i) June 27, 2013 “Crisis” Meeting; Introductory Comments

47. On June 27, 2013, defendants Leah E. Capece, Esq. and William P. Fabian convened a “crisis” meeting as a result of the Sun Bank fraud lawsuit, which had been filed/served a few days prior.

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48. In attendance at that meeting were defendant Laurence W. Gold, plaintiff, defendant Frank Rajs, defendant William P. Fabian, defendant Leah E. Capece, Esq. (presiding), plaintiff’s son Benjamin Applebaum, and plaintiff’s mother-in-law Eileen Applebaum.

49.

The meeting was unorthodox. Inter alia, although the defendants were aware that the meeting was being recorded, they were nonetheless unusually forthright in nonchalantly discussing prior instances of fraud as well as a new conspiracy to commit fraud, to wit, the “Wells Fargo 2013 fraud.”

50. This new bank fraud conspiracy, the “Wells Fargo 2013 fraud”, entailed a quarter-million dollar Wells Fargo (“WF”) line of credit needed to “bail out” THC - thereby also facilitating the payment of Mr. Fabian’s illicit “loans” and “consulting” fees.

51. Presumably, the defendants were candid at this “crisis” meeting because of the allegedly imminent collapse of the Todd Harris Company, and they were essentially left with no choice but to openly discuss solutions to the Sun Bank fraud lawsuit - even if these purported solutions entailed committing further fraud.

52. In addition, it appears that fraud was a commonly accepted modus operandi or modus vivendi at the company, and defendants presumed that plaintiff would embrace this lifestyle, thus openly discussing fraud at the June 27, 2013 “crisis” meeting.

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(ii) Coercion/Extortion of Plaintiff by Defendants

53. Defendants at the June 27, 2013 “crisis” meeting emotionally assaulted plaintiff in order to secure bailout funds from her - including potentially accessing her teacher’s pension and they further attempted to coerce her into executing two personal guaranties, one of them to be used to defraud Wells Fargo bank in mid-2013, infra.

54. Restated, defendants inflicted emotional distress on plaintiff in order to compel her to participate in a bank fraud conspiracy they had planned.

55. The coercion/extortion of plaintiff was dramatic and overwhelming.

56. Specifically, defendant Capece at this “crisis” meeting uttered as follows:

“This is an emergency meeting because there is a crisis here”, “if we don’t do something today, by the end of next week the Todd Harris Company will cease to exist”,

“Todd Harris

Company can be closed by the end of next week or we can make tough decisions today with your support and your assistance…”, “Sun Bank has brought these proceedings….and they’re going to do everything in their power…..including destroying this company in a matter of weeks”, “even repaying this debt, it’s still possible that they could still be criminally prosecuted…” ,

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“[w]e want you to understand what’s going on and we want you to support us in this” and “it’s sink or swim time” . (emphasis supplied)

57. Defendant Fabian uttered inter alia the following phrases to compel plaintiff to participate in the quarter-million-dollar bank fraud: “We’re screwed because of the actions we took back in November..”, “We’re in real trouble”, “they’re threatening to file criminal charges”, “You got to listen to [Capece]”. (emphasis supplied)

58. Having attempted to compel plaintiff’s participation in the fraud by duress, defendants then began to openly discuss the specifics of the fraud conspiracy.

(iii) Explicit Admissions of Sun Bank Fraud circa 2010 in the course of procuring a line of credit; Testimony of Bank Executive Deborah Heins corroborates same 59. First, defendant Fabian openly admitted at this “crisis” meeting that in soliciting the Sun Bank line of credit (“LOC”) in 2010, defendant Laurence Gold knowingly concealed Mr. Fabian’s illicit debts allegedly owed him by the Todd Harris Company, which debts totalled approximately half-a-million-dollars.

60. Specifically, defendant William P. Fabian at the “crisis” meeting - which was attended by Mr. Gold - uttered as follows: Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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You know how Todd owes me all this money, right? If I put that on the corporate books, then Sun Bank would never have loaned us a dime or Wells Fargo. If I put that on the books now, Wells Fargo won’t make the loan. So I have to keep everything from me off the books.

61. This bank fraud admission was corroborated by the Sun Bank executive who processed the line of credit application in 2010, to wit, Mrs. Deborah Heins, who testified at her deposition as follows (quote from February 20, 2018 deposition of Sun Bank executive Deborah Heins):

Q. I'm going to ask you to turn to the second page. By the way, Mrs. Heins, were you told that Bill Fabian was also a creditor of the Todd Harris Company? A.

No. I don't recall that, no.

Q. Were you told that he was a co-investor of the Todd Harris Company? A. No. …… Q. Which begins with 100,000 and it has an entry which says 1/90, 100,000, eight percent. Were you told or was this disclosed to you? A.

No, I do not recall ever seeing this.

….. A. If I had known that they had debt that they didn't put on the books, I wouldn't have done the loan…. Q.

Would this have been reported to the FBI?

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A. I would have reported it to credit and they probably would have reported it. …. Q.

And it could have been reported to the FBI?

Yes, if I was reading this when the loan came in, yeah. …

62. Thus, defendant Laurence W. Gold, CPA, knowingly concealed Mr. Fabian’s status as a THC creditor from Sun Bank in 2010.

This is corroborated by defendant Fabian’s

statement at his deposition that Mr. Gold was “possibly” aware of these disputed decades-old “loans”.

63. Further, Mr. Fabian at his deposition also admitted that defendants Rajs and Keh were both also aware of Mr. Fabian’s illicit “loans” and “consulting” fees. Since Ms. Keh at all relevant times has handled THC’s finances, and Mr. Rajs is “second only to Todd” per the deposition testimony of Mr. Fabian, it is also plausible that defendants Rajs and Keh participated in, ratified, or otherwise conspired to conceal these finances from Sun Bank in 2010 (and in 2013 relative to the Wells Fargo fraud, infra).

64. In addition to the foregoing, the Heins deposition uncovered further intentional financial mishaps committed by Mr. Gold as he solicited the line of credit on behalf of THC.

65. Specifically, Mr. Gold conveyed to Sun Bank (Mrs. Heins) during the application process that the Todd Harris Company had “recently” retained William P. Fabian, in or about 2010, in order to help steer the company in a different direction since the company had recently experienced two investments losses, one in Mexico (the “Mexico Deal”), and the Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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other one involving a local company called “Custom Pool Safety.”

66. Both said investments caused financial damage to THC, for which Sun Bank demanded remediation prior to extending a line of credit.

67. In an attempt to offer assurances to the bank that such financial mishaps would be avoided going forward, Mr. Gold thus knowingly misrepresented to Sun Bank that Fabian had “recently” been hired, despite being aware that Mr. William P. Fabian may have been a paid THC “consultant” since at least 2008, and an unpaid “consultant” for decades prior to 2008.

68. This misrepresentation was corroborated by defendant Fabian’s own statements at a prior meeting of the board of THC in 2013 and at his deposition in 2017, that he was in fact involved in both the Mexico Deal as well as the Custom Pool Safety deals.

That he

then attempted to recant when confronted with evidence of the fraud at his deposition is grounds for the additional RICO predicate act of perjury, infra.

(iv) Explicit Admissions of Criminality Relative to Sun Bank 2012 Fraud which led to Sun Bank fraud lawsuit 69. Defendants Fabian and Capece at this “crisis” meeting also admitted that their actions in withdrawing from the Sun Bank line of credit in 2012 and 2013 may have been criminal.

70. Specifically, Mr. Fabian uttered that “they’re threatening to file criminal charges against

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Frank and Cecilia and John Does… which can be any one of us here.”

71. Ms. Capece also held a lengthy discussion at the “crisis” meeting regarding retaining and paying for criminal defense counsel for defendants Cecilia Keh and Frank Rajs.

72. Defendant William P. Fabian - in a clear instance of perjury - at his deposition in 2017 blatantly denied referencing “criminal” counsel at the crisis meeting, although the word “criminal” was uttered nearly a dozen times as depicted by the certified transcript of the said June 27, 2013 “crisis” meeting.

(v) Explicit Admission of a Specific Conspiracy to Defraud Wells Fargo 73. In addition to the foregoing admissions regarding the Sun Bank fraud, Mr. Fabian at this “crisis” meeting further candidly admitted, in defendant Laurence W. Gold’s presence, that they would conceal his illicit “loans” and “consulting” fees from Wells Fargo in order to secure a quarter-million-dollar “emergency” line of credit:

We’re not reporting anything to anybody at the end of the day…..you know how Todd owes me all this money, right? …. If I put that on the books now, Wells Fargo won’t make the loan. So I have to keep everything from me off the books.

74. As stated infra, Predicate Act III, and as corroborated by the deposition of Wells Fargo Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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executive Kevin Harvey, Mr. Gold in fact knowingly concealed these “loans” from Wells Fargo while procuring a quarter-million-dollar line of credit on behalf of the Todd Harris Company.

75. In addition, Mr. Gold also knowingly concealed from Wells Fargo the Sun Bank lawsuit as well as the lien on accounts receivables held by Mr. Fabian to secure his “bailout” funds, notwithstanding that the line of credit they sought would have been secured by the said accounts receivables. (vi). Defendant’s Conspiracy to Conceal Mr. Fabian’s Lien on THC Assets 76. Defendant Leah Capece, having exercised full command and control over the June 27, 2013 “crisis” meeting, disclosed at said meeting that defendant Fabian would finance the Todd Harris Company’s “bailout”, and that he would be secured by a lien on the company’s accounts receivables.

She then demanded that plaintiff provide a personal

guarantee to Mr. Fabian as further protection:

....I think that it’s only fair that you give your guarantee on this amount to Bill…I think would be fair and that’s from the company’s point of view because I am also representing the company…..there will also be a lien on the assets of the company which we are not going to record so that Wells Fargo will continue to go through with the loan.

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(emphasis supplied).

77. The statement regarding not “recording” the lien was an explicit admission of the defendant’s conspiracy to conceal from Wells Fargo Bank materially relevant financials which would almost certainly have resulted in a denial of the “emergency” line of credit.

78. Mr. Laurence W. Gold, who was present at the said meeting, in fact subsequently knowingly concealed the said lien from Wells Fargo, per the testimony of Wells Fargo executive Kevin Harvey. He also knowingly concealed (i) the Sun Bank lawsuit which led to the “crisis” meeting, (ii) defendant Fabian’s disputed “loans,” (iii) defendant Fabian’s “consulting” fees or “deferred compensation”, and (iv) plaintiff’s personal guarantee to Mr. Fabian.

79. Shortly after this “crisis” meeting, defendant Leah E. Capece prepared Mr. Fabian’s “bailout” promissory note, and explicitly annotated the lien clause with the phrase “NO UCC filing.” She then underlined the phrase “NO UCC filing” for emphasis (graphic below):

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(vii) Decision to sell the “Toben” property was formulated at this “crisis” meeting and directly resulted from the fraud committed by defendants and the Enterprise’s Goal of re-paying defendant Fabian’s disputed “loans” and “consulting” fees 80. At this June 27, 2013 “crisis” meeting defendants Fabian and Capece also “agreed” to sell the lucrative Toben commercial property, which they had previously indicated they would not sell.

81. As discussed infra, the Toben property was subsequently sold - under false pretenses - in early 2014 at one half of the appraised value of one-and-a-half million dollars.

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82. In addition, defendants at this meeting also pledged the Toben property as additional collateral for the bailout funds provided by defendant Fabian in an amount exceeding three hundred thousand dollars.

This protection was in addition to the personal

guarantee demanded from plaintiff, as well as the lien on the Todd Harris Company accounts receivables.

83. The sole purpose of every proposed transaction discussed at this “crisis” meeting was, at all times, to benefit defendant William P. Fabian in payment of his disputed “loans” and “consulting” fees. (viii) Admission by Defendant Leah Capece, Esq., that the signatures at issue in the Sun Bank Lawsuit were in fact forged 84. Defendant Leah Capece admitted at the “crisis” meeting that the decedent’s signature was forged.

Specifically, she uttered that Sun Bank is “ claiming it was fraud because

[defendants in fact] signed the paperwork after Todd died...”

(Note: “defendants in

fact” was not uttered by Ms. Capece but was clearly implicit in her statement given the context). (ix). Predicate Act II (Conclusions) 85. In conclusion, the June 27, 2013 “crisis” meeting is pivotal in this RICO action because of the following six non-exhaustive reasons:

86. First, defendant William P. Fabian, under the stress of a recently-filed lawsuit, admitted to having committed bank fraud at Sun National Bank in the year 2010, only to then be

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sued for subsequent bank fraud in 2013 by the same bank.

87. Second, defendant Fabian at this meeting set forth a new bank fraud conspiracy, to wit, the Wells Fargo “emergency” bank fraud conspiracy, proposing same as a solution to the Sun Bank fraud lawsuit.

88. Third, Ms. Capece - who presided over the meeting and made statements beyond the scope of a bona fide attorney, admitted that she would participate in the Wells Fargo conspiracy by helping to conceal a lien.

89. Fourth, defendant Laurence W. Gold, CPA, was present at the said meeting - thereby providing compelling proofs that he was aware of the conspiracy and participated in same; he was also aware of Mr. Fabian’s disputed “loans” and “consulting” fees, and did not disclose same to various banks in 2010 and 2013.

90. Fifth, defendants urged plaintiff to participate in the Wells Fargo conspiracy, under duress, by repeatedly and irrationally alluding to the “impending doom” and collapse of her late husband’s company.

91. Sixth, defendants at this meeting began the process of fraudulently divesting the estate of the lucrative “Toben” commercial property - which property eventually sold for half of its appraised value in early 2014.

IV. Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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PREDICATE

ACT III - BANK FRAUD: QUARTER-MILLION-DOLLAR LINE OF CREDIT FRAUD AT WELLS FARGO IN MID 2013 AS CORROBORATED BY TESTIMONY OF INDEPENDENT WITNESS AND WELLS FARGO EXECUTIVE KEVIN HARVEY; THE FICTITIOUS ISSUE OF PLAINTIFF’S PERSONAL GUARANTEE AS PRETEXT FOR THE “DENIAL” OF THE LINE OF CREDIT AND AS THE GENESIS FOR PLAINTIFF’S DEFAMATION AND WHISTLEBLOWER CLAIMS, INFRA (i) Introduction - Predicate Act III

92. The June 2013 “crisis” meeting, as indicated supra, was replete with admissions of prior bank fraud defendants committed in 2010.

93. Defendants, however, also candidly articulated a new bank fraud conspiracy during that June 2013 meeting, to wit, to solicit a quarter million dollar “emergency” line of credit from Wells Fargo, in the process concealing the same debts they had concealed from Sun Bank in 2010, as well as additional financials related to the Sun Bank “bailout”.

94. Thus, defendant Leah Capece at that meeting nonchalantly offered to conceal from Wells Fargo a lien related to the Sun Bank bailout which exceeded three hundred thousand dollars and secured a loan made by Mr. Fabian. The lien was to be prepared by Ms. Capece herself as attorney for Mr. Fabian and/or the Todd Harris Company, and as a member of the within RICO enterprise.

95. Restated, defendants at this June 27, 2013 “crisis” meeting proposed committing further bank fraud at Wells Fargo in order to stave off a lawsuit by Sun Bank which lawsuit resulted from bank fraud committed in 2012 relative to a Sun Bank line of credit which

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had been procured through bank fraud in 2010.

96. That is to say, bank fraud was the modus vivendi or modus operandi at The Todd Harris Company - a standard way of doing business which defendants adopted as part of the within RICO scheme.

97. Subsequent to this “crisis” meeting, defendants took affirmative steps towards implementing the Wells Fargo bank fraud conspiracy they had planned.

(ii) Plaintiff’s express representations to the defendants that she will not participate in the fraud by providing a personal guarantee under false pretenses 98. At the outset, plaintiff made it clear to defendant Laurence W. Gold that she would not participate in the Wells Fargo bank fraud scheme by providing a personal guarantee under false pretenses.

Her concerns stemmed from a prior personal guarantee she had

provided Mr. Fabian which she presumed or suspected would not be disclosed to Wells Fargo. Thus, in a July 3, 2013 email to defendant Laurence Gold, plaintiff stated:

I am taking the time now to also inform you that it is NOT going to be possible for me to sign my personal assets including my teachers pension as you asked me to do in order to get a line of credit of a half million dollars from Wells Fargo Bank for the Todd Harris Company Inc. You know that I already signed all my assets to Bill Fabian for the amount of $348,000 and change which he lend [sic] me for the Todd

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Harris Company Inc. As you know because you were present at our meeting on 6/27/13, Sun Bank is suing the Todd Harris Company for fraud committed by unauthorized personnel, which I had nothing to do with. The money I borrowed from Bill Fabian was used to pay Sun Bank so they don't take over the Todd Harris Company as I was told by you, Bill and your lawyer. I don't have any other assets that would allow me to qualify for another loan.

99. In another email sent on that same day, plaintiff clarified the nature of the fraud, to wit, that signing a second personal guarantee without disclosing the prior personal guarantee constituted bank fraud:

Good morning Larry, It is not possible that the bank will accept my personal assets as potential collateral because I already signed my assets to Bill to cover the company debt with Sun Bank. Are you letting the Wells Fargo Bank know that I have that debt with Bill Fabian? Best regards, Edita.

(iii) Attempted Bank Fraud - Emails between Defendant Laurence Gold and Wells Fargo Executive Kevin Harvey - Knowing Concealment of Adverse Todd Harris Company Financials 100.

Despite being aware of plaintiff’s concerns regarding the bank fraud conspiracy,

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defendants nonetheless decided to move forward with the assistance of Laurence W. Gold as agent for The Todd Harris Company and/or William P. Fabian.

101.

email chain between Mr. Gold and a Wells Fargo accounts professional, Mr.

Kevin Harvey, sets forth the initial stages of the fraud, which was corroborated by the deposition testimony of Mr. Kevin Harvey.

102.

In the first email of the chain, dated September 26, 2013 Mr. Harvey admits he has in

his possession Todd Harris Company financials given to him previously.

There is no

indication within this email that this prior financial disclosure included defendant Fabian’s disputed “loans” and “consulting” fees exceeding three hundred thousand dollars.

In fact, Mr. Harvey at his deposition testified that he was not aware of the said

“loans” and fees, b ecause they were never disclosed.

103.

In the email, Mr. Harvey also requests that Mr. Gold provide him with an accounts

receivables aging report. As stated supra, said accounts receivables had previously been pledged as collateral relative to Mr. Fabian’s June 27, 2013 “bailout” lien, which lien was concealed from Wells Fargo along with other relevant financials - a fact corroborated by Mr. Harvey’s unequivocal deposition testimony in early 2018.

104.

Mr. Harvey concludes the September 26, 2013 email by requesting further financial

statements in addition to the accounts receivables aging report - thus offering Mr. Gold with yet another opportunity to make required disclosures. Per Mr. Harvey’s deposition

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testimony in early 2018, however, no such disclosures were ever made (graphic of September 26, 2013 email below):

105.

On the same day, Mr. Gold responded to Mr. Harvey and enclosed the financials Mr.

Harvey had requested.

However, once again, he deliberately concealed or failed to

disclose Mr. Fabianâ&#x20AC;&#x2122;s illicit loans, the Sun Bank suit, and other adverse THC financialsâ&#x20AC;&#x2039;:

106.

Two weeks later, having reviewed the financials submitted by defendant Laurence

Gold, Mr. Harvey for the first time became inquisitive or suspicious about a specific questionable item. Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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107.

Specifically, having been mislead by defendants, Mr. Harvey inquired about a

$353,244.00 “loan” from the “estate of Todd Applebaum” to the Todd Harris Company a clear reference to the bailout funds Mr. Fabian advanced the company in June of 2013, which they deliberately concealed from Wells Fargo (graphic of October 9, 2013 email below):

108.

In lieu of making required disclosures regarding the Sun National bank lawsuit and

the bailout funds financed by Mr. Fabian, defendant Laurence W. Gold knowingly misled Wells Fargo by responding as follows: “[t]he company had a credit line with Sun Bank. The line and all banking relations with them were terminated near the end of June. The estate forwarded the necessary funds to pay off the line.” (graphic of October 9, 2013 email below):

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109.

At his deposition, Mr. Harvey testified that he understood this email to mean that the

relationship with Sun Bank was terminated voluntarily by the The Todd Harris Company itself, and that he was therefore unaware that Sun Bank had “force terminated” the company’s account. Had he been privy to this adverse material fact, he would have denied the line of credit or otherwise refused to submit the application to underwriting.

110.

Mr.

Harvey at his deposition, which occurred in early 2018, confirmed that Mr. Gold

in fact knowingly concealed from Wells Fargo materially adverse company financials in the course of soliciting the quarter-million-dollar line of credit (verbatim deposition testimony below, deposition testimony of Wells Fargo executive Kevin Harvey, February 12, 2018):

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Q. At the time these e-mails were being sent, were you aware that the Todd Harris Company had been sued by Sun National Bank? A.

No, I was not.

Q. Would that have been something that you would be interested in knowing? A.

Absolutely.

Q. Therefore, you were not aware that the executor had made a payment to the estate, which was then paid to by way, I believe, of a loan to the Todd Harris Company to then satisfy the Sun National Bank lawsuit? A.

I knew nothing about a lawsuit, no.

Q. So you were not aware that the executor of the estate had a lien on the assets of the company, correct? A.

Correct. I did not believe I knew they had a lien.

You were not aware of the existence of any lien, correct, sir?

Not that I can recall, no.

…… …… A. I'm going to say that since I was unaware of what was going on, it had nothing to do with my decision whether to move forward or not. …... A. Yes, I was unaware of -- I did not have all the information I needed. …. A. I believe the answer is, yes, I did not have, all the material facts. Q.

Because they had not been disclosed to you?

A. Those items you had mentioned earlier, correct, they had not been disclosed. Q.

But you weren't aware of any liens favoring the estate for that?

Correct.

Q. Would it have made a material difference if you were aware that it was Sun National Bank who terminated, two things, the line and all Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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banking relations? A.

Yes.

A. It would have made a difference if they had told me that Sun forced terminated the line and forced them to leave the bank. Absolutely.

(iv) Attempts to defraud Valley National Bank, and other banks, in addition to Wells Fargo, in order to secure an “emergency” line of credit 111.

In addition to the foregoing, defendants Fabian, Capece, and Gold also attempted to

defraud Valley National Bank and potentially others in the course of seeking “emergency” funds.

112.

Thus,

in an affidavit dated April 20, 2016 defendant Fabian disclosed inter alia the

Valley National bank fraud (“THC” refers to the Todd Harris Company):

I immediately directed THC’s counsel to make an effort to resolve the suit and it was agreed between THC and Sun Bank that the loan would be repaid, together with interest and attorney’s fees. Although THC did not have the cash to make payments immediately, I personally loaned $350,000.00 to THC by drawing on a personal line of credit secured by my residence. After the payment was made, Sun Bank dismissed the lawsuit with prejudice and all defendants received general releases.

However, that line of credit was no

longer available.

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Through THC’s accountant, Larry Gold, Frank sought to obtain replacement financing from Wells Fargo Bank and Valley National Bank. Both banks turned THC down. My understanding from Mr. Gold is that Wells Fargo Bank required that the principals of the Company, and particularly Edita, personally guarantee any loan, just as Todd had previously guaranteed the Sun Bank line of credit. As Kevin R. Harvey, a Vice PResident at Wells Fargo, wrote to Mr. Gold, “[a]t the very least I think I will need Edita Applebaum to guaranty (sic) the loan”, to which Mr. Gold responded: “Edita Applebaum has made her wishes abundantly clear that she does not wish to risk her personal assets.” ...Edita repeatedly rejected Mr. Gold’s requests for her to pledge her personal assets to guarantee a Wells Fargo credit line for THC. Mr. Gold and Ms. Capece asked Wells Fargo and Valley National to consider making the loan without Edita’s personal guarantee, but neither bank made the loan. As a result THC has had to get by without the line of credit that Todd had always relied upon.

(v) The primary purpose in obtaining the “emergency” line of credit, through false pretenses, was to repay defendant Fabian’s debts - to the exclusion of Estate debts of higher priority

113.

The primary purpose in soliciting the quarter-million-dollar “emergency” line of

credit from Wells Fargo in mid-2013, under false pretenses, was to repay the Todd Harris

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Company’s indebtedness to defendant Fabian, in furtherance of the RICO enterprise’s goals.

114.

This much was implicit, if not explicit, in a July 4, 2013 email from defendant

Laurence W. Gold to plaintiff: “[r]egarding Wells Fargo, the plan was to substitute the monies owed to Bill Fabian with the monies advanced under a credit line with Wells Fargo Bank.”

115.

Further, although defendant Fabian advanced the Todd Harris Company “bailout”

funds in order to settle the Sun Bank fraud lawsuit, he was nonetheless the executor of the estate of plaintiff’s late husband, and was therefore charged with a fiduciary duty towards her.

116.

Moreover,

the “bailout” promissory note was payable to the order of defendant

Fabian in installments, over the course of a number of years.

Yet, in fraudulently

soliciting the Wells Fargo line of credit in order to prematurely pay off Mr. Fabian’s “bailout” promissory note,

defendants once again

prioritized defendant Fabian’s

interests only, in lieu of making a monetary distribution to plaintiff and her daughter.

117.

In fact, after nearly six years of estate administration, plaintiff and her daughter have

received no distribution from the multi-million dollar estate of her late husband. Most, if not all, of the Todd Harris Company’s multi-million dollar profits have been diverted to defendant’s coffers instead.

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(vi) Summary 118.

In summary, the Wells Fargo mid-2013 bank fraud conspiracy encompassed a

scheme to knowingly conceal from Wells Fargo

- and Valley National Bank - the

following five adverse Todd Harris Company financials:

(i) the Sun Bank fraud lawsuit, (ii) plaintiff’s “bailout” personal guarantee benefitting Mr. Fabian, (iii) Mr. Fabian’s “bailout” lien on the accounts receivables, (iv) Mr Fabian’s illicit and disputed decades-old “loans” and, (v) Mr. Fabian’s illicit “deferred compensation”

119.

Defendants then in fact attempted to execute this conspiracy, as depicted by the

September 2013 email communications between Mr. Gold and Mr. Kevin Harvey, as well as the deposition of testimony Mr. Harvey taken in early 2018.

120.

Having been unsuccessful in their efforts to fraudulently obtain a line of credit from

Wells Fargo, and in retaliation for plaintiff’s failure to participate in the fraud by providing a personal guarantee under false pretenses,

defendants then conspired to

penalize the plaintiff.

121.

Specifically, defendants spread the word within The Todd Harris Company that

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plaintiff was not a team player, and that the purported “denial” of the line of credit was directly attributable to her refusal to “cooperate” by providing a personal guarantee. This defamatory accusation resulted in plaintiff’s discharge from her late husband’s company, in the presence of police officers, as set forth infra at Count III and Count IV. V. PREDICATE ACT IV MONEY LAUNDERING, PAYROLL FRAUD, WIRE FRAUD, MAIL FRAUD, COMMON LAW FRAUD: DEFENDANT FABIAN’S PAYROLL SALARY IS FICTITIOUS - THE SALARY, PAID PURSUANT TO A FRAUDULENT EMPLOYMENT AGREEMENT, IS ACTUALLY IN SATISFACTION OF DISPUTED “LOANS” AND “CONSULTING” FEES (i.) Genesis Of Payroll Issue - Ms. Capece Articulated The Fraud And The Conspiracy To Commit Fraud In The December 9, 2012 Meeting Of The Board Of Thc

122.

Defendant Leah Capece, Esq., was retained circa November 15, 2012 by Mr. William

P. Fabian to represent the estate and/or Mr. William P. Fabian as executor, having been introduced into the case by defendant Laurence W. Gold.

123.

Defendant Fabian circa April of 2013 claimed that Ms. Capece at the time of her

hiring was also representing defendant Laurence Gold, to wit,

“Larry works with her

already.”

124.

Since then, Capece has represented multiple parties oftentimes as against the client’s

own interests. At all times, however,

she has remained faithful to the interests of

defendant William P. Fabian only, particularly as it pertains to his scheme to pay himself his disputed decades-old “loans” and “consulting” fees, Count I, ¶200. Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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125.

Ergo Ms. Capece is, essentially, Mr. Fabian’s “fixer” and is loyal only to him.

126.

Inter alia, she once boasted she would perform a specific legal task only if Mr.

Fabian so requests, to wit,

at the “crisis” meeting of June 27, 2013 she uttered, “I can

certainly oppose the [Sun Bank lawsuit]... and if I'm asked to.. I will.”

127.

Mr. Fabian has also made it clear that Ms. Capece was retained because she acts at his

behest. Thus, in April of 2013 Mr. Fabian boasted that defendant Capece has “done everything we want her to do…. Her duties are whatever I tell her to do that are with within, you know.”

128.

Ergo, Ms. Capece’s professional discretion was or has been clearly superfluous

throughout her representation of various parties since 2012. Indeed, despite purporting to represent The Todd Harris Company and Toben Investments, Inc., her actions as counsel for those entities reflects an unyielding loyalty to defendant William P. Fabian only, as depicted inter alia by the “fire sale” of the lucrative Toben commercial property, infra, as well as the bank fraud she has explicitly engaged in relative to the scheme to pay William P. Fabian hisa disputed “loans” and “consulting” fees, Count I, ¶200.

129.

A useful starting point to explore Ms. Capece’s active role in the within RICO

enterprise can be found in the minutes of the Todd Harris Company board meeting of December 9, 2012.

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130.

The meeting took place approximately one month after the passing of Todd Harris

Applebaum, and its purpose was to either ratify or reject the alleged employment agreements (“EA’s”) for defendants Fabian and Rajs, said EA’s allegedly having been executed in February of 2010 and not ever having been previously “ratified” in this manner.

131.

Defendant Leah Capece presided over the meeting, with defendant Fabian also acting

as chairman of the board of the company, and Frank Rajs as a director.

132.

In approving the fictitious EA’s, defendant Leah E. Capece at said meeting explicitly

admitted that she was ratifying an instrument which was to be used to commit fraud and money laundering (quote from the December 9, 2012 meeting minutes follows):

In addition, Fabian pointed out that his current salary of $104,000.00 is effectively the only way he was being repaid for the loans and previous consulting fees he was owed by THC. He and Todd had expressly agreed that no repayment would commence until Fabian retired in 2013, at which time he would draw an annual salary and benefits, the value of which would be used to reduce the amount owed to Fabian.

133.

The following is a scanned image of the incriminating board meeting minutes:

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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134.

Ms. Capece since some indeterminate time has also acted as legal counsel for the

Todd Harris Company (in addition to having represented Mr. Fabian), and to this day continues to represent that company, aware that the company has been paying defendant Fabian a fictitious 100K per annum salary since 2012.

135.

Indeed, at a meeting in August of 2013 Ms. Capece once again admitted the payroll

fraud, this time explicitly referencing Mr. Fabian's fictitious employment agreement, and

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in the process admitting that said agreement was a fraud (verbatim quote from August 2013 meeting follows): Well, essentially there was a loan that was made during Mr. Applebaum’s lifetime …it’s not being repaid as a loan at this time. Instead there was a consulting arrangement made with Mr. Fabian. That way he would be repaid funds”

136.

At a prior meeting in April of 2013, defendant Fabian articulated one of the clearest

admissions of the payroll fraud, and directly implicated defendant Frank Rajs: “I had Frank put me on the payroll for a hundred thousand dollars a year, which is going to pay me back and it’ll take five, six years, whatever it takes” 137.

August of 2013, defendant Mr. Fabian then set forth the scheme in its entirety and

in startling detail (verbatim quotes from August 2013 meeting follows): Q. So the payments under the consulting arrangements, these payments were not just made during those years? A. That’s correct, by agreement between Todd and I Q. For what period of time, …So what is amount that has been to be paid off? A. Until it’s paid off. Approximately $500,000. Q. Okay. So consequently why are you being paid as salary? A. Because Frank and I and Larry agreed that that would be the best way to take it Q. It’s your position from a tax and accounting perspective that that holds water? A. I can’t think of any other way. Q. A repayment of a loan? A. What’s the difference? If I pay it as ordinary income and get it weekly, then I don’t have to worry about whether or not they have the money to pay me and then there’s skipped Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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payments and problems. It’s an administrative thing and I don’t think there’s a problem with it. Q. So the company has being issuing financial statements…I assume it’s given to financial institutions had that debt ever been recorded? A. Absolutely not. Q. So it’s not on the books and the records of the company? A. That is correct

138.

Following this incriminating colloquy, defendant Leah Capece once again explicitly

ratified the fraud, by claiming that defendant Fabian’s disputed and illicit loan(s) is/are “not being treated as a loan(s).”

139.

In a sworn certification dated April 20, 2016 defendant Fabian committed perjury by

claiming that the payroll payments were not in satisfaction of his “loans” notwithstanding that he had admitted the payroll fraud in August and September of 2013: TODD’S REQUEST THAT I PROVIDE CONSULTING SERVICES TO THC DURING HIS LIFETIME Throughout the course of our friendship, Todd requested that I loan money to THC to help Todd carry it through dry spells. The loans I made in 1990 and 1993 totaled $150,000.00, which Todd agreed would accrue interest at 8%. We had no formal agreement… In or about 2006, I retired from Morey La Rue Company...Shortly thereafter, I began consulting for Todd more regularly. At that time, Todd and I agreed that I would be compensated for these services by an annual salary of $104,000 but my salary would only accrue and not be paid until I told him I needed the income. At the time of Todd’s death, $231,700 in unpaid consulting fees had accrued.

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In February 2010, Todd Handed me an “employment agreement” that documented our agreement and which we both signed on February 15, 2010..I did not begin receiving payments under the agreement until November 2012, after Todd died. Since that time, I have drawn a weekly salary of $2,000.00 as the only compensation I have received for my role in the oversight of THC’s operations, which required far more attention than I had expected, for the reasons explained herein.

140.

At his September 2017 deposition, Mr. Fabian “modified” the foregoing perjury by

admitting that he was in fact commiting payroll fraud but that he “changed his mind” at some indeterminate time, and thus began to earn the weekly payroll check by engaging in actual “consulting”.

141.

Mr. Fabian was unable to articulate the time and date he “changed his mind,” and he

provided little or no details regarding the nature of the “consulting” he performed.

142.

A subpoena served on the payroll processor for the Todd Harris Company confirms

that Mr. Fabian has been paid this salary since November of 2012, and continues to this day to do so, in satisfaction of his disputed and potentially non-existent “loans” and “consulting” fees.

143.

By utilizing and communicating to the payroll processor (Balance Point) this

fraudulent payroll information, defendants also committed inter alia mail and wire fraud.

(ii). Defendant Fabian Since 2012 Through Present Has Received Nearly 300 Payroll Checks Which Were Not Actually Payroll, But Rather As Repayment Of Disputed “Loans” And “Consulting” Fees, Thereby Committing Nearly 300 Instances Of Fraud Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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144.

As depicted by a subpoena served on the payroll processor, defendant Fabian has

consistently received a $2,000.00 payment every week since November of 2012 in satisfaction of his disputed decades-old “loans” and “consulting” fees.

145.

Ergo, Defendant Fabian, aided by defendants Gold, Capece, Cecilia Keh,

D’Ambrosio, and Frank Rajs, has committed nearly three hundred separate instances of payroll fraud.

146.

Defendant Capece has contributed to this scheme by committing litigation fraud,

infra, and by refusing to hand over discovery related to the scheme and/or by utilizing a frivolous non-disclosure agreement, infra, to conceal relevant financials from plaintiff (as she did with her frivolous motion to quash a Wells Fargo subpoena, which would have revealed that defendants concealed Fabian’s “loans” from Wells Fargo in the course of soliciting a quarter-million-dollar line of credit and in furtherance of the RICO scheme to repay Mr. Fabian.)

147.

Defendants D’Ambrosio and Cecilia Keh have contributed to said fraud by, inter alia,

handling THC’s financial affairs as comptroller and/or de facto treasurer of THC.

(iii) Efforts To Conceal The Fraud By Defendants 148.

Defendants Gold, D’Ambrosio and Capece, under direction from Mr. Fabian, have

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undertaken explicit efforts to hide from plaintiff The Todd Harris Company’s financials. This was evident in an email of July 24, 2013 from Mr. Gold to D’Ambrosio, which was forwarded to defendants Capece, Rajs, and Fabian:

Regarding financial information: No one is too see copies of financial statements (this includes [plaintiff] and the rest of Todd’s family) other than Frank or Bill unless they give you permission to do so.

149.

In addition, as stated infra, defendant Capece has also engaged in unorthodox

litigation as part of the conspiracy to conceal the fraud from plaintiff.

150.

For instance, Ms. Capece has insisted throughout the litigation that plaintiff execute a

“global” non-disclosure agreement which purports to prevent plaintiff from receiving any and all relevant discovery, financial or otherwise.

151.

As stated supra, defendant Capece has also dramatically curtailed discovery by filing,

in 2017, a frivolous motion to quash a Wells Fargo subpoena, which subpoena would have provided further evidence of the quarter-million-dollar fraud Ms. Capece herself engaged in by inter alia concealing a lien exceeding three hundred thousand dollars in value. (iv). Defendants Admitted The Payroll Fraud At Depositions And At A Meeting Of August 29, 2013, Although Defendant Fabian At A Second Deposition, Under Oath, Then Testified That He “Changed His Mind” Regarding Receiving The Payments As “Repayment” Of His Loans, Thereby Committing Perjury.

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152.

The case sub judice is replete with clearly articulated admissions which are typically

followed by mischaracterizations and attempts to distort the facts through further deceit, fraud, innuendo, and outright perjury.

153.

Thus, defendant Leah Capece specifically set forth the payroll fraud in the minutes of

the December 9, 2012 Todd Harris Company board meeting,

and she made further

subsequent admissions of same in August of 2013.

154.

Defendant Fabian admitted the payroll fraud in August and September of 2013.

However, after the filing of plaintiff’s state court complaint circa March of 2014, Mr. Fabian “modified” his account of the payroll fraud.

155.

Thus, at his first deposition on October 27, 2016 defendant Fabian admitted having

authored a handwritten missive dated September 4, 2013 which stated the balance on his undocumented “loans” would be reduced by his payroll salary to date, to wit, $104,000.00. See Count I, ¶200 and ¶202.

156.

However Mr. Fabian at the same deposition, aware of plaintiff’s fraud lawsuit against

him, then committed perjury by claiming that the pre-litigation September 4, 2013 missive which admitted the fraud - and which he admittedly authored - was a “mistake”.

157.

Mr. Fabian also committed perjury in a sworn certification dated April 20, 2016 by

suggesting that the payroll payments he had received since November of 2012 were for

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actual “consulting” work done. To date, however, he has been unable to characterize or give verifiable specifics regarding the nature of the “consulting” work he allegedly engaged in or is currently engaging it at the Todd Harris Company.

158.

In fact, there is not one document in this voluminous case which sets forth the

“consulting” done by Mr. Fabian or the number of hours he has worked. E.g. no billing statements or any other document(s) whatsoever which characterizes or describes the “consulting” Mr. Fabian has allegedly engaged in weekly since 2012.

159.

At his September 2017 deposition, Mr. Fabian again committed perjury by partially

denying the payroll fraud. In an apparent freudian slip, however, Mr. Fabian admitted that he committed the payroll fraud, this time claiming that he “changed his mind” at some indeterminate point in time and that on some unspecified date he began receiving the payroll payments for actual “consulting” work.

160.

To date, he has been unable to reasonably characterize said “consulting” with

verifiable specifics, instead often generalizing the alleged work performed with the ambiguous term “consulting”.

161.

At his second deposition in September of 2017, he was further unable to give the date

and time of this purported “change of mind”, although it should be noted that the September 4, 2013

missive, along with Mr. Fabian and Ms. Capece’s August 2013

admissions regarding the payroll fraud, offer compelling proofs that the illicit payroll

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payments at the very least spanned the period of November 2012 through August or September of 2013.

162.

However, as his mischaracterizations regarding the payroll fraud are not credible - by

preponderance of the evidence plaintiff can prove that he has in fact committed payroll fraud from November of 2012 through present, which fraud has directly impacted and financially harmed plaintiff. (v) Defendant Laurence W. Gold, Cpa, Accountant For The Todd Harris Company, Knowingly Misrepresented Fabian’s Payroll Payments For Accounting Purposes, Including In Preparation Of Income Tax Returns And In Financial Statements Submitted To Court 163.

Defendant Laurence W. Gold, CPA, who in a recorded meeting with the plaintiff

once boasted about the benefits of “undervaluing inventory” and referenced the “secrets” of small businesses, has been the company accountant since approximately the year 2008.

164.

Inter alia, on February 15, 2010, Mr. Gold allegedly also acted as a witness in the

signing of the contested employment agreement (“EA”) for defendant Frank Rajs.

165.

On that same day, defendant Frank Rajs himself allegedly witnessed the signing of

defendant’s Fabian disputed employment agreement, which was actually a money laundering instrument used to facilitate the repayment of Mr. Fabian’s disputed and outdated “loans” and “consulting” fees, as depicted at Count I, ¶200.

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166.

Defendant Maxine Melnick allegedly notarized both of these questionable

instruments - and conveniently claims to have no records of the notarization, thus making her a bona fide member of the within RICO conspiracy.

167.

The foregoing supports the proposition that defendant Laurence Gold was aware of

Mr. Fabian’s fictitious employment agreement. Concomitantly, he was or should have also been aware of the scheme to use said employment agreement for money laundering, to wit,

the repayment of Mr. Fabian’s illicit “loans” and “consulting” fees, Count I,

¶200.

168.

In fact, at the June 27, 2013 “crisis” meeting defendant Fabian in the presence of

defendant Gold stated in no uncertain terms that his illicit “loans” and “consulting” fees would be concealed from certain specific financial institutions,

thus providing

compelling proofs that Mr. Gold was aware of the payroll scheme involving the use of the fictitious employment agreement, which would facilitate repayment of these disputed “loans” while simultaneously concealing same from various potential lenders. 169.

At his deposition, Mr. Fabian also confided that Mr. Gold “may” have been aware of

these disputed “loans”,

170.

In addition, a memorandum prepared by Sun Bank executive Deborah Heins circa

2010 indicates that Mr. Gold was intimately familiar with Mr. Fabian’s “employment” at the Todd Harris Company.

Ergo, and particularly because he was the company’s

exclusive accountant, Mr. Gold should have been aware of the financial terms of Mr.

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Fabian’s purported “employment”.

171.

As such, defendant Laurence W. Gold has been an instrumental player in the scheme

to pay the defendant Fabian his disputed “loans” and “consulting” fees by utilizing the payroll of the Todd Harris Company.

172.

Defendant Gold, since 2012 and perhaps prior thereto,

has therefore knowingly

misrepresented The Todd Harris Company’s income in their federal and state income tax returns, specifically Line 8, Form 1120S, the “salaries and wages” line of federal income tax form 1120S.

173.

Restated, from 2012 through present defendant Gold has knowingly prepared and

filed Todd Harris Company income tax returns,

fraudulently including defendant

Fabian’s fictitious 100K per annum salary at line 8 in federal form 1120S, while aware that this “salary” wasn’t actually a salary - but rather repayment of Fabians’ disputed “loans” and “consulting” fees.

174.

Thus, in the 2013 federal income tax return for the Todd Harris Company, Mr. Gold

overstated the company’s “salaries and wages” by approximately 100K, claiming that the company paid $741,067.00 in salaries whereas it actually paid approximately $641,067.00. He did so in furtherance of the scheme to aid defendant Fabian in the payment of his disputed “loans” and “consulting” fees.

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175.

Similarly, in the company’s 2012 taxes, Mr. Gold overstated the company’s salaries

by approximately 100K, claiming that it paid $791,808.00 in salaries and wages, whereas the actual figure should have been lower. He did so in furtherance of the scheme to aid defendant Fabian in the payment of his illicit and disputed “loans” and “consulting” fees.

176.

In preparing the Todd Harris Company’s 2014 taxes, Mr. Gold again intentionally

overstated the company’s salaries by approximately 100K, claiming that it paid $605,955.00 in salaries and wages, whereas the actual amount was actually in the vicinity of $505,955.00. He did so in furtherance of the scheme to aid defendant Fabian in the payment of his illicit and disputed “loans” and “consulting” fees.

177.

In preparing the Todd Harris Company’s 2015 taxes, Mr. Gold yet again intentionally

overstated the company’s salaries by approximately 100K, claiming that it paid $580,741 in salaries and wages, whereas the actual amount should have been reduced by about $100,000.00. He did so in furtherance of the scheme to aid defendant Fabian in the payment of his disputed “loans” and “consulting” fees.

178.

Upon information and belief, Mr. Gold has also overstated the salaries and wages in

the 2016 and 2017 income tax returns. He did so in furtherance of the scheme to aid defendant Fabian in the payment of his disputed “loans” and “consulting” fees.

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179.

In addition to the foregoing, defendant Gold aided in the preparation of financial

statements which were submitted in various accounting(s) filed in state Court, thereby committing perjury.

(vi). The Purported “Employment Agreement” Used For Defendant Fabian’s “Deferred Compensation” Payroll Scheme, Contains Compelling Indicia Of Fraud 180.

Nearly eighteen months after the passing of Todd Harris Applebaum, and just

immediately after the commencement of state court litigation in early 2014, plaintiff for the first time became aware of defendant Fabian’s purported employment agreement (“EA”), which on its face bears compelling indicia of fraud.

181.

The EA purported to give Mr Fabian the right to lifetime employment at the Todd

Harris Company, along with exorbitant and financially unattainable fringe benefits, such as a million dollar cash payout in the event of Mr. Fabian’s death, as well as a million-dollar golden parachute.

182.

Mr. Fabian has been paying himself a salary on the payroll of The Todd Harris

Company since immediately after the passing of Todd Harris Applebaum in November of 2012, and he has repeatedly admitted that said payroll payments were in satisfaction of two items: “loans” made in the early nineties as set forth at Count I, ¶200, and a species of “deferred compensation” incurred between 2008 and 2012 for “consulting” he has been unable to substantiate or describe to date, Id.

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183.

As stated supra,

Mr. Fabian and Ms. Leah Capece both have made numerous

statements admitting that the payroll payments were in satisfaction of these unorthodox and disputed “loans” and “consulting” fees, thus acknowledging that Mr. Fabian was not formally employed at the company.

184.

Nonetheless,

immediately after the commencement of litigation and nearly two years

after the commencement of his duties as executor, and further aware that plaintiff would raise the payroll fraud issue in Court,

Mr. Fabian introduced into this case an

employment agreement (“EA”) which purportedly authorized the otherwise illicit payroll payments.

185.

The clear purpose of this unorthodox EA was to disguise the payroll scheme by

misrepresenting the payroll payments as bona fide payments for actual “consulting”.

186.

187.

The EA, to be sure, contained compelling indicia of fraud on its face.

Specifically, it was dated February 15, 2010 and contained Mr. Todd Harris

Applebaum’s “lazy” signature - a shortened signature which could be easily forged.

188.

Further,

during the initial stages of the state court litigation in early 2014, Mr. Fabian

in sworn interrogatories stated that the author of the EA was the same person who had drafted Mr. Todd Harris Applebaum’s last will and testament, to wit, one “Paul Cavise”.

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189.

Paul Cavise is a lawyer and a financial consultant, and has known Mr. Fabian for

decades.

190.

As the litigation progressed, and particularly after Mr. Paul Cavise’s deposition

testimony casting doubt on the veracity of the EA, Mr. Fabian committed perjury once again by “modifying” his previous sworn statement that Cavise had prepared the EA.

191.

Specifically, having previously clearly stated that Mr. Cavise drafted the EA, Mr.

Fabian at his own deposition recanted and claimed instead that it was a “combination” of Mr. Fabian and Mr. Cavise who drafted the questionable EA.

192.

Indeed Mr. Fabian had little choice, as Mr. Cavise at his deposition, which took place

approximately one month prior to Mr. Fabian’s, had no recollection of having drafted that EA.

193.

In addition, Mr. Cavise at his deposition also identified further indicia of fraud in the

EA - such as the use of formatting (e.g. italics) and font sizes he would not have used in drafting such EA’s.

194.

Restated,

Mr. Cavise essentially testified that it was unlikely he would have drafted

the EA, thereby characterizing it as a fraud.

195.

The EA was notarized by defendant Maxine Melnick, who admitted not having

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records of the notarization, and it was allegedly witnessed by defendant Frank Rajs.

196.

A similar EA executed on that same day and time, for defendant Frank Rajs, indeed

contained formatting which was different from Mr. Fabian’s EA, notwithstanding that both said EA’s were allegedly drafted by the same person, Mr. Paul Cavise.

197.

In addition, Mr. Todd Harris Applebaum’s alleged signature in Fabian’s EA was

markedly different from his signature in Raj’s EA, although both agreements were allegedly signed on the same date.

198.

Specifically,

Mr. Raj’s

EA contained what appears to be Mr. Todd Harris

Applebaum’s complete signature, whereas the (fraudulent) Fabian EA contained the much shorter “lazy” signature, which could be replicated by anyone with minimal effort (GRAPHIC/TABLE of BOTH SIGNATURES BELOW).

SUSPECT FABIAN EA WITH RAJS EA WITH COMPLETE “LAZY” SIGNATURE, ALLEGEDLY SIGNATURE, ALLEGEDLY SIGNED SIGNED ON 2/15/2010 ON THE SAME DATE: 2/15/2010 The Signatures of Todd Harris This document contains the complete Applebaum and Frank Rajs both appear to signature of Todd Harris Applebaum, and be forged a different signature for Frank Rajs

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199.

As noted in the graphic(s) above, the signature for defendant Frank Rajs is also

markedly different in Mr. Fabian's employment agreement, thus offering further compelling proofs that Mr. Fabian's employment agreement is a fraud.

(vii). The Handwritten And Unsigned “Ledger Sheet” Submitted To Court As Proof Of The “Deferred Compensation” And Mr. Fabian’s Disputed “Loans” And “Consulting” Fees Are Fraudulent 200.

A particularly contentious and fraudulent aspect of the State Court litigation has been

the use of a handwritten and unsigned two-page document, which is allegedly nearly thirty years old, as “proof” of the “loans” and “consulting” fees - or the “deferred Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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compensation” -

allegedly owed defendant William P. Fabian by the Todd Harris

Company (graphic below):

201.

This suspect document was introduced into this case on September 4, 2013 - ten

months after the passing of the late Todd Harris Applebaum.

202.

Thus,

on September 4, 2013 defendant Fabian forwarded a handwritten missive to

defendant Leah Capece which included a series of figures purporting to reflect the total amounts Mr. Fabian was owed, as well as “deductions” for payroll payments he had received from The Todd Harris Company and Toben Investments, Inc. (graphic below):

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203.

Effectively, Mr. Fabian with this document acknowledged that the payments he had

been receiving on the payroll of both the Todd Harris Company as well as Toben Investments were essentially fraudulent, and in fact were nothing more than repayment for past amounts he was allegedly owed.

204.

As an exhibit or attachment to this September 4, 2013 missive, Mr. Fabian enclosed

the two page handwritten and unsigned “loan” and “consulting” fee document supra ¶200 - which defendants in the state court litigation have disingenuously called a “ledger sheet” in an attempt to disguise its true nature.

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205.

This unsigned handwritten “ledger sheet” and its accompanying “cover letter”

missive are both fraudulent for various reasons.

206.

First, at his deposition Mr. Fabian characterized the payroll “deductions” found in the

September 4, 2013 handwritten missive as a “mistake”.

207.

Second, Sun Bank executive Deborah Heins acknowledged at her deposition that

defendant Laurence W. Gold in 2010 disclosed to Sun National bank that Mr. Fabian had been “recently” hired by Todd Harris Applebaum sometime in the year 2010. Yet, the handwritten “ledger sheet” indicates that Mr. Fabian sought “deferred compensation” for “consulting” work done in 2008 and 2009.

208.

Third, Mr. Fabian claims that he met with the late Todd Harris Applebaum yearly to

enter the interest payments in the handwritten “ledger sheet” supra.

Yet, there is not

one document signed by the late Todd Harris Applebaum to substantiate the loans, the yearly interest entries, and/or the “deferred compensation”.

209.

Fourth, there are no formal instruments whatsoever memorializing these debts or the

“deferred compensation,” or expressing the terms of the alleged contract between defendant William P. Fabian and the late Todd Harris Applebaum.

210.

Fifth, the employment agreement defendant William P. Fabian allegedly signed on

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February 15, 2010 entitles him to a 100K yearly remuneration in perpetuity. Yet, the “deferred compensation” sought in the handwritten “ledger sheets” for the years 2010, 2011, and 2012, reflect compensation far less than one hundred thousand dollars per annum.

211.

In addition to above, as stated supra, defendant Leah Capece, Esq., received these

questionable “ledger sheets” in or about September 4, 2013. To the extent she advised anyone that these decades-old debts were collectible, then she committed a further instance of fraud.

212.

Further, as stated supra, Mr. Fabian to date has been able to substantiate the

“consulting work” he allegedly engaged in. He has been unable to describe the work, has produced no billing records or the like, and instead purports to claim a nearly half a million dollar debt based on numbers he wrote on sheets of paper with pencil and pen.

(viii). Use Of Toben Investments Inc. To Commit Further Payroll Fraud 213.

Mr. Fabian has been on the payroll of the Todd Harris Company (“THC”) and Toben

Investments Inc. since November of 2012 - and has therefore paid himself in excess of four hundred thousand dollars in repayment of his disputed and undocumented decades-old “loans”, as well as his “consulting” fees in the form of “deferred compensation”.

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214.

One of the companies Mr. Fabian received payroll remuneration from, Toben

Investments Inc., which at one time owned a lucrative commercial property as its sole asset, was essentially a shell company which was used almost exclusively to commit financial crimes, including money laundering, embezzlement, payment of no-show salaries, and repayment of Mr. Fabian’s disputed “loans” and “consulting” fees.

215.

The September 4, 2013 handwritten missive authored by Mr. Fabian, supra, contains

the most compelling evidence that Toben salary paid to Mr. Fabian was fraudulent. In that letter, Mr. Fabian admitted that he was being paid a Toben salary, and requested that the salary be deducted from the disputed amounts he was allegedly owed.

216.

That he recanted under oath after the filing of plaintiff’s complaint is grounds for

perjury, infra.

217.

Thus, Mr. Fabian, after the filing of the complaint at his deposition attempted to posit

that between 2011 and 2014 he had actually been working at Toben “managing” its sole asset, a profitable commercial property which had been rented to commercial tenants with a “triple net” lease.

218.

This statement is perjurious and does not conform to the facts.

219.

First, Mr. Fabian had previously admitted in the September 4, 2013 missive that the

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Toben salary was fictitious. Second, the tenants of the property had a “triple net” lease which delegated to them most tasks. Third,

defendant Laurence W. Gold was an

authorized signatory to the Toben checking account - and processed most payments, including the potentially fraudulent “Morey La Rue” mortgage payments to Mr. Fabian.

220.

In sum, the evidence compels the conclusion that Mr. Fabian’s statement in

September 4, 2013, that the Toben payroll was fictitious or otherwise in satisfaction of his disputed loans, is more credible that the perjury he committed at his October 2016 deposition wherein he recanted and stated otherwise.

(ix). Conclusions: Predicate Act IV, Payroll Fraud 221.

The payroll fraud is the core of the RICO conspiracy plead herein.

222.

The payroll payments to defendant William P. Fabian,

of arbitrary amounts

evidenced by nothing but his own self-serving handwritten annotations on a purported “ledger sheet,” Count I, ¶200, gave rise to substantial losses at the Todd Harris Company and resulted in the firing and defamation of plaintiff when she was deemed to be a potential whistleblower.

223.

The disputed payroll payments also resulted in substantial losses to the estate,

including the fire sale of the lucrative “Toben” property at nearly one half of its one-and-a-half-million dollar valuation.

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224.

In late 2017, in retaliation for plaintiff’s state court fraud lawsuit which referenced

this payroll fraud, defendants filed a frivolous motion to sell plaintiff’s minority stake in the Todd Harris Company at discount, effectively disinheriting her completely notwithstanding that she has received no moneys from her late husband’s estate in nearly six years of estate administration by defendants.

225.

The proofs are compelling.

226.

They began with defendant Fabian promptly placing himself on the payroll upon the

passing of Mr. Applebaum in November 2012, followed by defendant Capece’s explicit admission at the December 9, 2012 board meeting that the payroll payments were essentially a fraud.

227.

Subsequently, in August and September of 2013, Ms. Capece and Mr. Fabian both

made additional admissions of the fraud, stating unequivocally that the payroll payments were in satisfaction of decades-old, disputed “loans” and “consulting” fees which lack any satisfactory proofs and, more importantly, which are not evidenced by any writing or instrument signed by the late Todd Harris Applebaum. See Count I, ¶200.

228.

Defendant’s post-litigation attempts at mischaracterizing the payroll payments, by

utilizing a fraudulent employment agreement to posit in State Court that the payroll payments were “earned” based on actual hours worked at the Todd Harris Company,

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constitute actionable perjury under the RICO statute, and further resulted in significant losses to the Estate and to plaintiff, in the form of exorbitant attorneys fees paid to all parties in an amount exceeding one million dollars. Predicate

act V: Mail Fraud, Wire Fraud, Embezzlement, et al: Theft of 401K Proceeds, ERISA Violation (AMENDED November 12, 2018) 229.

The late Todd Harris Applebaum on the day of his passing was a participant in a

401(K) plan with John Hancock Financial Services, valued at approximately one hundred thousand dollars, which defendants William P. Fabian and Cecilia Keh, through false pretenses, misappropriated.

230.

As decedent’s surviving spouse, plaintiff was entitled to the full value of the policy

unless she signed an express waiver of rights, which she did not.

231.

Despite plaintiff’s unsuccessful efforts to locate the policy documents immediately

after the passing of her husband in November 2012, which documents defendants deliberately concealed from her, defendant Frank Rajs promptly began the process of transferring or rolling over said 401K policy from John Hancock to ING, now known as (defendant) Voya Financial, Inc.

232.

John Hancock at the time of this transfer was not notified that Mr. Todd Harris

Applebaum had passed away.

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233.

In early April of 2013, defendant William P. Fabian as executor of the estate of Todd

Harris Applebaum, and defendant Cecilia Keh, through false pretenses, then caused the said Voya Financial Services 401K funds (formerly ING), which were the property of the plaintiff and not subject to the probate process, to be paid to the Estate, as depicted by the graphic below:

234.

Specifically, in a nine page fax dated April 3, 2013 from Intac (third party

administrator) account manager Susan Bauer (defendant herein) to ING (now known as defendant “Voya Financial Services”), Mrs. Bauer forwarded to ING decedent Todd Harris Applebaum’s death certificate, which included plaintiff’s name and clearly identified her as the spouse of Todd Harris Applebaum. (Intac was acquired by Ascensus circa July 2018. It is not alleged herein that Voya Financial and/or Intac/Ascensus were participants in the RICO scheme, the claims against them are in the form of Common Law Negligence and ERISA, infra).

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235.

Also included in that facsimile was an ING death benefit form signed by Fabian as

executor on 4/1/2013, and an “Employer, Plan Sponsor, or Named Fiduciary Authorized Signature and Certification” which was signed by Cecilia Keh on 4/1/2013, and which authorized disbursement of the 401K proceeds to the Estate - under false pretenses.

236.

Intac Account manager and defendant Susan Bauer, authorized the disbursement as a

“third party administrator” and in that certification stated that “ING may rely conclusively” on the certification signed by Cecilia Keh - ergo Voya/ING had discretion to not make the disbursement, and may be sued in common law as well as a fiduciary under the ERISA statute, infra.

VII. PREDICATE ACT VI: LITIGATION FRAUD: PERJURY AND THE FILING OF FRIVOLOUS PLEADINGS TO DISINHERIT PLAINTIFF IN 2017 AND 2018 UNDER FALSE PRETENSES, WITH FRIVOLOUS AFFIDAVITS, ET AL. (i). Introduction 237.

The State Court litigation is in this case commenced circa March of 2014 with the

filing of a verified complaint and order to show cause by plaintiff.

238.

Over one dozen depositions have been conducted, and thousands of interrogatories

served since litigation began in early 2014.

239.

Dozens of subpoenas and related discovery devices have produced over thirty

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thousand documents in this matter.

240.

Numerous motions, verified pleadings, and order to show cause(s) have been filed

for various issues in the said state court litigation.

241.

Among the more significant issues addressed in those motions/pleadings are requests

for the removal of defendant Fabian as executor, accounting and discovery-related issues, and motions for a distribution from the estate to plaintiff, who has received no formal distribution in six years of estate administration.

242.

The various requests to remove defendant Fabian as executor were denied - on

grounds that it was not an “emergent” issue and therefore any damages could be remedied by monetary redress, which is the purpose of the within pleading.

243.

Mediation attempts have failed - largely because of the complex fraud issues and the

inherent limitations of the jurisdiction of the Probate Court, as discussed supra.

244.

Also problematic in the four-year-old state court litigation was the constant, rather

direct, and comprehensive participation of defendant Leah Capece, Esq., as litigation counsel for the Todd Harris Company - which was not a named party. To be sure, although Ms. Capece purported to represent the Todd Harris Company, she frequently advocated in favor of the interests of defendant Fabian and/or defendant Gold.

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245.

That is to say, Ms. Capece’s only loyalty is to the members of the RICO enterprise

plead herein.

246.

The attorneys who most frequently participate in the four-year-old state Court

litigation (still in the discovery phase) are Ms. Leah Capece, Esq., and the law firm representing defendant William P. Fabian as executor.

247.

The attorneys for defendants Rajs and Keh have also made their presence known in

the state court litigation, but in a more limited manner.

248.

Defendant Laurence W. Gold has been represented throughout by Ms. Ellen Gold,

although defendant Leah Capece has frequently taken steps to protect his interests, since he was her former client and the person who introduced her to defendant William Fabian.

249.

This was evident inter alia in Ms. Capece’s insistence on participating in the

deposition of Mr. Gold in late 2017, although he was represented by attorney Ellen Gold. The deposition has not taken place as a direct result of Ms. Capece’s interference. A motion to sequester Capece from depositions filed circa August of 2017 has not yet been decided.

250.

The participation of Ms. Capece in this matter has in fact been particularly complex

and unorthodox.

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251.

Ms. Capece since March of 2014 to present day continues to participate in the

litigation - and oftentimes acts in furtherance of the interests of defendant William P. Fabian, who was also her former client.

252.

In fact, most discovery requests related to the Todd Harris Company, which is an

estate asset controlled by defendant Fabian as executor, have been typically delegated by Mr. Fabian’s current litigation counsel to Ms. Capece, notwithstanding her known direct participation in the within RICO enterprise.

253.

Because of the jurisdictional limitations of the Probate Court, Ms. Capece was not

sued directly in State Court.

254.

The litigation fraud in the State Court litigation has thus been the product primarily of

Ms. Capece, as well as Mr. Fabian and the other defendants in misrepresenting the facts to the Court and/or their respective attorneys.

255.

Ms. Capece has committed litigation fraud inter alia by knowingly, as a fact witness

with direct knowledge, advancing frivolous arguments. The other defendants, primarily Mr. Fabian, have knowingly committed systemic perjury.

256.

Ms. Capece would thus typically either file her own motions or responses to motions,

purporting to advance the interests of the Todd Harris Company, an estate asset controlled by Mr. Fabian, or she would be delegated by Mr. Fabian’s counsel discovery

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requests which she would openly litigate in Court, often knowingly advancing frivolous arguments.

257.

In one such instance, Ms. Capece frivolously submitted a form order to the Court

which purported to authorize mediation - although the plaintiff at a lengthy Court hearing had previously expressed her disapproval of same, and the Judge at the same hearing predicted the case would go to trial, in lieu of mediation.

(ii). Use Of A Frivolous Non Disclosure Agreement To Prevent All Discovery

258.

One of the more prevalent litigation schemes used by defendant Leah Capece, Esq.,

was the use of a frivolous non-disclosure agreement (“NDA”) to withhold the most significant fraud-related discovery.

259.

Defendant Leah Capece was frequently delegated discovery requests which had been

initially served on Mr. Fabian and his litigation counsel.

260.

Prior to the execution of the non-disclosure agreement, infra, Ms. Capece would

often refuse to comply with said discovery requests citing “privacy” concerns and “confidential” financial information of the Todd Harris Company.

261.

Compelled by the State Court to sign a non-disclosure agreement, and since discovery

was being frivolously withheld by Ms. Capece, the plaintiff under duress eventually

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executed an NDA, which is nonetheless non-binding as it was never signed by the purported beneficiary, the Todd Harris Company (“THC”).

262.

To the extent defendant Ms. Capece compels her client, the Todd Harris Company, to

sign the NDA after the filing of the within RICO Complaint, despite her role as a named defendant in this suit, the plaintiff hereby repudiates same and rejects the contents of the far-reaching and expansive NDA, which purports to circumvent nearly all discovery, financial or otherwise, by imposing unreasonable burdens.

263.

Should this Court find the NDA to have been lawfully executed, notwithstanding it

was not signed by the Todd Harris Company, it is respectfully submitted that same is nonetheless void ab initio a s against public policy, since inter alia it prevents any and all discovery unless defendant Capece “rubber stamps” same.

264.

After plaintiff signed the NDA, Ms. Capece knowingly attempted to use same to

forestall key discovery regarding fraud - fraud in which she had been a direct participant.

265.

This much

was

evident

in the Wells Fargo subpoena relative to the

quarter-million-dollar “emergency” line of credit sought by defendants in 2013 through false pretenses, as discussed supra.

266.

Specifically, Ms. Capece in late 2017 filed a frivolous motion, under false pretenses,

to quash a lawful subpoena which had been served to obtain the file related to the

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“emergency” line of credit from Wells Fargo - the same line of credit defendants had decided they would fraudulently procure at the June 27, 2013 “crisis” meeting, supra.

267.

Her pretext for quashing this subpoena was that plaintiff had not executed a second

NDA to protect the Todd Harris Company from third party discovery, although she seemingly admitted in her moving papers that the first (partially executed) NDA may also cover third party subpoenas - thus obviating the need for a second NDA and rendering her motion per se frivolous.

268.

The motion to quash the Wells Fargo subpoena has not been decided as of the date of

the filing of the within complaint - and thus the requested discovery was never obtained.

269.

Inter alia, this subpoena would have provided discovery related to Ms. Capece’s

direct participation in the Wells Fargo line of credit fraud, which included her deliberate efforts to conceal a lien exceeding three hundred thousand dollars from Wells Fargo in order to obtain an “emergency” quarter-million-dollar line of credit, as set forth supra.

270.

Notwithstanding her efforts at forestalling this discovery, a subsequent deposition of

Kevin Harvey, a Wells Fargo executive, in fact revealed that defendant Laurence Gold did knowingly conceal the said lien during the application process for the quarter million dollar line of credit.

271.

Ms. Capece and Mr. Gold were both in attendance at the deposition of Wells Fargo

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executive Kevin Harvey in early 2018 - presumably aware of the potential damaging testimony that may result and in a clear attempt to influence his testimony by inter alia knowingly making specious objections to the questions asked.

(iii). The Motion To Sequester Defendant Leah Capece And Her Successful Efforts To Stop The Deposition Of Key Defendant And Former Client Laurence W. Gold, CPA. 272.

In or about August of 2017, Ms. Capece made efforts to attend, and participate in, the

deposition of her former client, defendant Laurence W. Gold, CPA, who is a pivotal witness represented by his own counsel.

273.

Mr. Fabian has had competent counsel throughout the litigation, as has Mr. Gold and

the other parties. Their respective attorneys thus had the option of attending Mr. Gold's deposition to advance their respective client’s interests, making an appearance by Ms. Leah Capece superfluous and vexatious.

274.

Given the foregoing, and because of Ms. Capece’s prior representation of Mr. Gold,

her “insider knowledge”, and her direct participation in the Wells Fargo fraud, a motion to sequester Ms. Capece from the deposition was filed in or about September 2017.

275.

To date, that motion has not been decided - and neither has the deposition of key

witness defendant Laurence W. Gold.

276.

Consequently, Ms. Capece’s insistence on participating in Mr. Gold’s deposition,

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although her purported client the Todd Harris Company is not a named party in the state litigation, has effectively prevented the deposition of a pivotal witness - company accountant Laurence W. Gold, CPA.

(iv). Perjury

277.

The perjury committed by defendants in the state litigation is widespread, prevalent,

and compelling.

278.

There have been over one dozen depositions conducted, over one dozen sworn

affidavits, and thousands of sworn interrogatories answered by the parties since the commencement of litigation in early 2014.

279.

The perjury committed consisted primarily of defendant’s efforts to conceal from

plaintiff, and the Court, the nature of the fraudulent payroll payments Mr. Fabian has been receiving since the passing of plaintiff’s husband.

280.

Prior to the commencement of litigation in early 2014, defendants often openly

discussed fraud with plaintiff, as they were seemingly unaware that this “school teacher” would squarely address the fraud which has cost her an inheritance for nearly six years.

281.

In some instances, they would simply deny - under oath - an otherwise unequivocal

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admission made prior to litigation.

282.

In other instances, defendants would take inconsistent positions within the litigation

itself, i. e. they would make a sworn statement, only to then take a clearly inconsistent position in subsequent sworn statement in the same litigation.

283.

Thus, in sworn interrogatories, when asked who drafted the employment agreement

(“EA”) used to disguise the payroll fraud, defendant William P. Fabian - having the opportunity to give a comprehensive answer since the interrogatories were answered without any parties present - clearly and unequivocally stated that EA was drafted only by one “Paul Cavise”, an attorney who is also a financial consultant.

284.

However, in September of 2016 Mr. Paul Cavise at his deposition discredited Mr.

Fabian’s sworn interrogatory statement that he (Cavise) had drafted the employment agreement - and did all but call said employment agreement a fraud.

285.

As a direct consequence of this damaging testimony, in October of 2016 Mr. Fabian

“modified” his answer - and claimed instead that a “combination” of himself and Mr. Cavise drafted the disputed employment agreement, thereby committing perjury and an act in furtherance on the RICO conspiracy plead herein.

286.

In another perjury instance which is particularly significant, Mr. Fabian prior to

litigation readily admitted - on more than one occasion - that the payroll payments he had

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been receiving from the Todd Harris Company (“THC”) since November of 2012 were fictitious or fraudulent.

287.

Thus Mr. Fabian frequently nonchalantly admitted, as stated supra, that the payroll

payments he had been receiving since November of 2012 were the “only” vehicle for him to receive payment of his illicit “loans” and “consulting” fees as depicted at Count I, ¶200.

288.

Specifically, on December 9, 2012, and in August and September of 2013, Mr.

Fabian openly said that the payroll payments he had been receiving from both Toben as well as the Todd Harris Company were both fictitious - i.e. that the payroll amounts he had been receiving were actually repayment for his disputed loans and fees, and not for actual work he did for any of these companies.

289.

These statements were corroborated by his prior attorney, Leah Capece, who openly

said in December 9, 2012, and twice in August of 2013, that the payroll payments were actually repayment of Mr. Fabian’s disputed “loans” and “fees”. Count I, ¶200.

290.

However, once the litigation began in early 2014, Mr. Fabian began to

mischaracterize the payroll payments in an effort to conceal the payroll fraud from the Court.

291.

Thus, he would often state under oath that he had never received any payroll checks

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in satisfaction of his illicit “loans” and “consulting” fees (or “deferred compensation”), Count I, ¶200.

292.

Thus, in an April 20, 2016 certification, defendant William Fabian recanted from his

pre-litigation statement(s) and attempted to posit instead that the payroll payments he had been receiving since November of 2012 were for actual and current consulting work he allegedly performed at the Todd Harris Company between November 2012 and April 2016, and not as “repayment” of his disputed “loans” and “consulting” fees.

293.

Notwithstanding, Mr. Fabian in that April 2016 certification also inadvertently

admitted having received the payroll payments in satisfaction of the disputed “consulting” fees and “loans,” by stating inter alia that he agreed not be paid under the purported employment agreement at the time it was allegedly signed in 2010 but instead his “salary would only accrue and not be paid until [Mr. Fabian] told [Mr. Todd Harris Applebaum that he] needed the income.” [text in brackets added].

294.

In said April 2016 certification, Mr. Fabian also inadvertently admitted the fraud by

further stating that when he began to receive a payroll salary of $2000.00 per week in November of 2012 he had “expected” to do little or no work.

295.

The

following verbatim excerpt from the April 20, 2016 certification illustrates the

foregoing:

TODD’S REQUEST THAT I PROVIDE CONSULTING Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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SERVICES TO THC DURING HIS LIFETIME Throughout the course of our friendship, Todd requested that I loan money to THC to help Todd carry it through dry spells. The loans I made in 1990 and 1993 totaled $150,000.00, which Todd agreed would accrue interest at 8%. We had no formal agreement… In or about 2006, I retired from Morey La Rue Company...Shortly thereafter, I began consulting for Todd more regularly. At that time, Todd and I agreed that I would be compensated for these services by an annual salary of $104,000 but my salary would only accrue and not be paid until I told him I needed the income. At the time of Todd’s death, $231,700 in unpaid consulting fees had accrued. In February 2010, Todd Handed me an “employment agreement” that documented our agreement and which we both signed on February 15, 2010..I did not begin receiving payments under the agreement until November 2012, after Todd died. Since that time, I have drawn a weekly salary of $2,000.00 as the only compensation I have received for my role in the oversight of THC’s operations, which required far more attention than I had expected, for the reasons explained herein. (emphasis supplied)

296.

As stated supra, the foregoing statements under oath made by defendant Fabian

contradict multiple statements he - and his prior attorney Capece- made in December of 2012 and in August of 2013, that he was in fact receiving a payroll check in satisfaction of his disputed “loans” and “deferred compensation” fees.

297.

In addition to the foregoing perjury, defendant Fabian then further committed perjury

in depositions taken in October of 2016 and September of 2017.

298.

Thus, at his first deposition in October of 2016 Mr. Fabian characterized as a

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“mistake” the September 4, 2013 handwritten missive which cited payroll “deductions” exceeding 100K, and which he had submitted to his prior attorney Capece as part of the litigation.

299.

See Count I, ¶202 (September 4, 2013 handwritten missive).

The said September 4, 2013 handwritten missive, which amounted to an admission of

the payroll fraud, purported to reduce the balance owed on his disputed “loans” by the amount of payroll funds he had received since November of 2012. See Count I, ¶202 (September 4, 2013 handwritten missive).

300.

By characterizing this September 4, 2013 admission as a “mistake”, Mr. Fabian

committed perjury.

301.

At his second deposition in September of 2017, Mr. Fabian “modified” his account

of the payroll fraud by implicitly admitting that he was in fact commiting payroll fraud but that he subsequently “changed his mind” at some indeterminate time, at which time he unilaterally decided to “earn” the payroll check by actually working.

302.

Mr. Fabian had this “change of mind” notwithstanding his allegedly unambiguous

“agreement” with Todd Harris Applebaum that the payroll check was in satisfaction of past due “loans” and “consulting” fees.

303.

Defendant Fabian had difficulty remembering the date he “changed” his mind.

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304.

In saying that he “changed” his mind, Mr. Fabian essentially admitted that he did

commit payroll fraud previously, as otherwise there would be nothing to “change”.

305.

Another noteworthy instance of perjury, among many others, concerns a certification

submitted to Court in which Mr. Fabian deliberately mischaracterized a prior court order in an attempt to prevent plaintiff from receiving a distribution from the estate - which she has not received in nearly six years.

306.

Specifically, the State Court Judge on February 3, 2015 signed a “form of order”

prepared by one of the parties which purported to deny - “with prejudice” - a transfer of Todd Harris Company shares to plaintiff, which she would have otherwise been entitled to pursuant to the last will and testament of her late husband.

307.

In fact, however, the denial of the transfer had been without prejudice and the

designation on the order as having been “with prejudice” was merely an administrative error which all parties were aware of.

Indeed, there had been no formal summary

proceeding or plenary hearing for the State Court Judge to make such a consequential ruling.

308.

After a new Judge unfamiliar with the facts took over the case in early 2017,

defendants nonetheless knowingly attempted to mislead the new Judge by claiming in a sworn certification that the denial of the transfer was substantively “with prejudice.”

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309.

As a consequence, nearly six years after the passing of plaintiff’s late husband of

nearly twenty-two years, the shares have not been transferred to plaintiff, who also has received no formal distribution from the estate during that time.

310.

In fact, defendants are attempting to unlawfully disinherit plaintiff by selling her

shares at a premium, as stated infra.

311.

Yet another among many other instances of perjury concerns Mr. Fabian’s

participation in the failed “Mexico” and the “Custom Pool Safety” investment deals, in which the Todd Harris Company was a participant and which resulted in significant losses to the company.

312.

The proofs in the case sub judice indeed support the proposition that Mr. Fabian

worked as a paid consultant for the Todd Harris Company between 2008 to 2012, and as an unpaid consultant for years - if not decades - prior to that.

313.

Further, in recorded meetings in 2013, and at his September 2017 deposition, Mr.

Fabian unequivocally stated that he was an active p articipant in the failed Mexico and Custom Pool Safety ventures.

314.

However, a memorandum obtained from a Sun National Bank via subpoena indicates

that Mr. Fabian was not involved in either of those two failed investments - and Sun

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Bank in 2010 in fact relied on this misrepresentation to grant the Todd Harris Company a quarter-million-dollar line of credit, since they had been told that Mr. Fabian had “recently” been hired to help avoid such financial mishaps.

315.

At his September 2017 deposition Mr. Fabian committed perjury by first clearly

asserting that he was in fact actively involved in those two failed deals.

316.

However, when presented with the Sun Bank memorandum which contradicted his

prior deposition statement, he “modified “ his answer by claiming that his involvement in those failed deals was ex post facto - that he helped close these deals only after they had failed.

317.

The proofs, however, do not support this narrative - and it is thus more likely that Mr.

Fabian was in fact an active participant in those two failed ventures.

(v). The Retaliatory And Frivolous Pleadings, Under False Pretenses, To Disinherit Plaintiff And Sell Her Shares In Her Late Husband’s Company As Punishment For Her Filing Of The State Court Fraud Lawsuit 318.

The plaintiff hereby repeats the allegations of Count IV, the “CEPA” Whistleblower

Count, as if fully set forth herein.

319.

Plaintiff on December 4, 2013 was fired and escorted by police from her late

husband’s company in retaliation for her whistleblower activities, infra. Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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320.

Defendants disingenuously claimed in various affidavits dated May of 2014, and

prepared by defendant Leah Capece as counsel, that among the (pretextual) reasons for the firing was a “staring” incident whereby plaintiff stared at an employee.

321.

This “staring”

incident was deemed to have the capacity to “destroy” her late

husband's company, thus resulting in her discharge on December 4, 2013.

322.

The affidavits, to be sure, inadvertently also admitted whistleblower animus.

323.

Thus, nearly all affiants (see, e.g., ¶90) referenced plaintiff’s suggested change in the

gas receipts procedure at her husband’s company as a reason for her firing, notwithstanding that these gas receipt changes targeted potentially fraudulent activities in a company which nearly collapsed because of fraud (e.g. the Sun National Bank lawsuit and the June 27, 2013 “crisis “ meeting).

324.

These frivolous affidavits were prepared in May of 2014 - merely a couple of months

after plaintiff filed suit and six months after her discharge - and they were retaliatory in nature, meant to be used to retaliate against plaintiff for filing the lawsuit.

325.

The frivolous affidavits referenced nothing more than “activity” plaintiff engaged in

while physically present at the company premises as a formal employee, and none of that employment-related “activity” was managerial in nature or was performed in her

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capacity as a shareholder of the company.

326.

Nonetheless, defendants in August of 2017 and October of 2018 filed the affidavits

in the State Court as part of a verified complaint, filed under false pretenses, in order to frivolously support a non-sequitur, to wit, that the plaintiff’s non-controlling 40% minority stake in the Todd Harris Company should be sold to a third party as otherwise, they argued, plaintiff would “destroy” the company pursuant to the allegations set forth in the work-related affidavits.

327.

Defendants,

then,

argued for plaintiff’s

complete disinheritance as

minority-shareholder in order to prevent the collapse of the company, which they posited could be a natural result of plaintiff’s “staring” at employees and/or a result of her standing next to the time clock to meet and greet the men running her late husband's company.

328.

The affidavits absolutely do not in any way support, substantiate, or corroborate the

specious hyperbole that plaintiff could “destroy” a multi-million dollar company as a minority shareholder, whether or not she once “stared” at her former co-workers before her discharge.

329.

The affidavits as used by defendants are thus essentially defamatory, and they do not

support the non-sequitur for which they were used (the sale of plaintiff’s minority stake in the company).

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330.

The true reason for the frivolous and fraudulent pleading to disinherit plaintiff, as set

forth below, and as became apparent at Mr. William Fabian’s September 2017 deposition, was to penalize plaintiff for her whistleblower activities, particularly the quasi-fraud lawsuit she filed circa April of 2014 which, inter alia, sought the removal of William P. Fabian as executor of the estate of plaintiff’s late husband because of the rampant fraud committed by defendants.

331.

In fact, at his September 8, 2017 deposition Mr. Fabian explicitly set forth the

whistleblower animus for the pleadings to disinherit plaintiff (verbatim deposition quote below, “A” is for answer, “Q” is for question):

A. The fact that she …. attacked all of the managers of the company via the lawsuit, was part of my consideration. Q. I'm sorry, sir, she attacked. Can you, please, explain to me how she attacked people with a lawsuit? A. She claimed that they were, they had committed fraud and wrongdoings and things of that nature. Q. You're saying she should not have done that? A. Well, I certainly don't think so, that's right.

332.

In sum, the sole purpose of the frivolous and retaliatory pleadings to disinherit

plaintiff, which defendants knowingly filed in August 2017 and October 2018 under false pretenses, was to prevent plaintiff from exposing the rampant fraud at her late husband's company and/or to retaliate against her for the filing of the State Court lawsuit. Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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(vi). Other Forms Of Litigation Fraud

333.

Other instances of litigation fraud include the filing, in State Court, of financial

statements authored by defendant Laurence W. Gold, CPA, which misrepresented The Todd Harris Company's payroll as discussed supra.

334.

In addition, the firesale of the lucrative commercial property owned by Toben

Investments, as discussed in the next predicate act infra, generated further litigation fraud in that defendants misrepresented in Court filings the nature of the environmental damages which purportedly caused the sale, infra.

335.

The

plaintiff hereby pleads the allegations in Count XII, Rule 10b-5 Secutirities

Fraud, as if fully set forth herein, and submits that same is an additional predicate act of the RICO conspiracy plead herein.

336.

The

plaintiff hereby pleads the allegations in Count XV, Fraudulent Concealment, as

if fully set forth herein, and submits that same is an additional predicate act of the RICO conspiracy plead herein, particularly as same relates to the role of Thomas S. Howard, Esq., Gartenberg Howard LLP, in this post-suit RICO conspiracy.

VIII. Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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Predicate

Act VII: Common law Fraud, Mail fraud, wire fraud: Use of Toben Investments Inc. as a Shell Company for “No Show Salaries” And Other Financial Crimes; Firesale of Toben’s Sole Asset, the “Linden Commercial Property” under false pretenses; (i). Introduction

337.

Toben Investments, Inc. is an asset of the estate of the late Todd Harris Applebaum,

plaintiff’s husband of nearly twenty two years, which was owned 51% by Mr. Applebaum and 49% by his son.

338.

When Mr. Applebaum passed in November of 2012, his share of Toben and its assets

belonged to the estate, and but-for the within RICO enterprise said assets would have eventually been inherited by plaintiff.

339.

Thus plaintiff, as the sole “residuary” beneficiary of Mr. Applebaum’s estate, stands

to inherit 51% of Toben and its remaining assets.

340.

However, as a direct result of the RICO enterprise as plead in the within complaint,

Toben Investments Inc. , defendant Leah Capece's purported client, currently has no assets.

341.

The sole asset once owned by Toben was a commercial property appraised at one

and a half million dollars in early 2014.

342.

Defendants knowingly sold this commercial property under false pretenses, after the

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appraisal was issued, at approximately one half of the appraised value of nearly one and a half million dollars.

343.

Toben was incorporated during Mr. Applebaum’s lifetime in early 2011.

344.

At the time, defendant William P. Fabian was a allegedly a “consultant,” working for

Mr. Applebaum per an alleged “employment agreement” signed in early 2010.

345.

In or about October 2011, Toben purchased the lucrative commercial building,

which was based in Linden NJ, from a company called “Morey La Rue” (“Linden Commercial Property”), defendant herein.

346.

Defendant Fabian for years or decades prior had been “employed” by Morey La Rue,

and held various positions within the company, including positions as an officer of the company.

347.

He was also at the time of the transfer of the “Linden Commercial Property” a

potential “off the books” equity owner of Morey La Rue.

348.

The extensive evidence of record indeed suggests that defendant Fabian utilized

defendant Morey La Rue as a shell company for his own purposes, and potentially for purposes of the RICO scheme plead herein, which purposes included tax evasion, money laundering, and/or embezzlement.

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349.

Thus, at the time of the transfer of the profitable “Linden commercial property” from

Morey to Toben in 2011, for five hundred thousand dollars, Mr. Fabian was upon information and belief de facto owner of Morey La Rue, and likely in receipt of the property's rental income which at the time was approximately $270,000.00 per annum, for which he presumably paid income taxes.

350.

An appraisal of the property performed in late 2013, ordered by defendant Leah E.

Capece, Esq., described this October 2011 conveyance of the property from Morey to Toben as a “transfer of convenience”.

351.

In addition, the substantive financial terms of this conveyance were per se suspect.

352.

Specifically, Morey La Rue agreed to accept a purported “down payment” of

$170,000.00, which was payable in monthly installments, and the “balance” of $330,000.00 was to be paid pursuant to a five year private mortgage - notarized by defendant Laurence Gold - between Morey La Rue and Toben Investments Inc.

353.

Thus the facts suggest that Toben was a shell company used to facilitate money

laundering and /or tax evasion, and that this “transfer of convenience” in 2011 may have been intended to help Mr. Fabian avoid or evade income taxes, since effectively he would now be fraudulently receiving his rental income in two ways: a purported monthly mortgage payment, and by way of a weekly salary he paid himself from the Toben

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payroll, infra.

354.

However, it is undisputed that legal title in the the Linden commercial property was

vested in Toben at the time of the passing of the late Todd Harris Applebaum in November of 2012.

355.

As such, absent the RICO predicate acts plead herein, the profitable commercial

property was rightfully an estate asset which plaintiff would have inherited.

356.

Instead, the RICO enterprise plead herein has resulted in plaintiff getting nothing in

six years of Estate administration, as well as the looming threat to completely disinherit plaintiff by way of the fire sale of her minority stake in the Todd Harris Company.

(ii). Defendant Fabian’s Receipt Of The Toben Property Rent Proceeds Through False Pretenses; No Show Salaries 357.

Between October 2011 through April 2014, the day of the sale of the profitable

Linden commercial property, defendant William P. Fabian received remuneration from Toben Investments Inc. in at least four ways: (i) the Morey La Rue mortgage payments, which the evidence suggests were funneled to Mr. Fabian personally (ii) an additional monthly sum as part of the 170K “downpayment” for the purported purchase of the property in 2011 (iii) a “salary” of approximately $1,600.00 per month and (iv) health insurance in the approximate amount of $2,500.00 per month.

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358.

In addition, there was a “no show” salary which Toben inexplicably paid to

defendant Frank Raj’s wife, Lea Rajs, in the amount of $642.77 per week, as well as additional health insurance for Mrs. Rajs in the approximate amount of $1,700.00 per week.

359.

At his deposition, Mr. Fabian seemingly admitted Mrs. Rajs’ “no show” salary and

justified it by claiming that the late Todd Harris Applebaum simply “wanted it that way.”

360.

The monthly mortgage payments were typically mailed to Mr. Fabian or to someone

working for or with one of the defendants, typically defendant Frank Rajs.

361.

Thus, from January 1, 2012 through December 2012 the monthly mortgage payments

from Toben to Morey La Rue (hence Mr. Fabian) were mailed to Morey La Rue “C/O" defendant Frank Rajs. The checks were signed by defendant Laurence W. Gold, CPA (Two Images Below, Toben Investment Checks):

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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362.

Almost immediately after the passing of Mr. Todd Harris Applebaum, starting in or

about December 31, 2012, the monthly mortgage payments from Toben to Morey La Rue went directly to Mr. Fabian. All checks were signed by Laurence W. Gold, CPA:

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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363.

In addition to these mortgage payments, Mr. Fabian was receiving a weekly “no

show” salary from Toben, as depicted by this check from Toben directly to defendant William P. Fabian, dated March 28, 2014, for pay period 3/15/2014-3/28/2014 (check signed by defendant Laurence W. Gold, CPA):

364.

As stated supra, Mr. Fabian has been inconsistent and has committed perjury with

regards to this Toben “no show” salary.

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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365.

On the one hand, the September 4, 2013 missive he admittedly authored supra

constitutes compelling evidence that Mr. Fabian's Toben salary is fictitious, i.e. that these monthly Toben payroll checks are issued in repayment of Mr. Fabian's decades-old and disputed “loans” and “consulting” fees.

366.

The “repayment” theory is corroborated, in a compelling way, by three or more

admissions defendants Fabian and Capece made on December 9, 2012 and in August of 2013, that Mr. Fabian would be placed on the payroll not as an actual employee but rather to have his disputed “loans” and “consulting “ fees paid off.

367.

This compelling theory notwithstanding, after the filing of plaintiff’s complaint in

early 2014 Mr. Fabian committed perjury and attempted to recant by claiming that the payroll payments were for actual “consulting” work.

368.

In one such attempt at perjury at his September 2017 deposition, however, Mr. Fabian

inadvertently admitted the fraud, by stating that he “changed his mind” at some indeterminate date regarding receiving the payroll checks as repayment of his disputed “loans”, and that he was now earning the weekly payroll check by engaging in actual labor.

369.

However this “alternative fact”, that Mr. Fabian “earns” his payroll check by

engaging in actual labor, does not conform to the evidence of record.

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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370.

Specifically, and as as stated supra, the Toben entity and the sole asset it once owned,

the “Linden” commercial property, do not require the type of management or labor Mr. Fabian claims entitles him to “earned” wages, particularly since the tenants of the property were tenants in a triple net lease and, as stated supra, defendant Gold managed most if not all of the Toben accounts.

371.

As such, it is more likely that the Toben payroll salaries for Mr. Fabian and Mrs. Rajs

are “no show” salaries which encompass a RICO scheme to launder or embezzle monies, and is likely also tied to the repayment of Mr. Fabian’s disputed “loans” and “consulting” fees, in furtherance of the RICO scheme plead herein.

(iii). The Fire Sale Of Toben At One Half Of The Appraised Value Under False Pretenses: The Fraud Of Environmental Damage To The Property As Pretext For The Sale. 372.

From November 2012 through June of 2013, defendants consistently represented to

plaintiff that the lucrative Toben commercial property would not be sold.

373.

Mr. Fabian during that time was comfortably and effortlessly receiving a salary

from Toben, as well as a monthly mortgage payment and health benefits.

374.

During this period, he had no reason to believe these illicit payments would be in

jeopardy, and as such did not contemplate the sale of the property.

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375.

However, during the crisis meeting of June 27, 2013 defendants came to a different

conclusion - and thus decided to effectuate the “urgent” sale of this lucrative and profitable multi-million dollar asset.

376.

At the time of the June 27, 2013 crisis meeting, repayment of defendant William P.

Fabian’s illicit and disputed “loans” and “consulting” fees was in peril, since the source of his fraudulent payroll payments, the Todd Harris Company, was facing insolvency or stood to suffer financial damage as a result of the Sun Bank fraud and lawsuit.

377.

As such, in an effort to secure funds to pay Mr. Fabian’s illicit loans, and in

furtherance of the RICO scheme plead herein, a decision to sell the property was made during the said June “crisis” meeting.

378.

So urgent was Mr. Fabian’s need to sell the property to recover his illicit and disputed

“loans” and “consulting “ fees, that the profitable “Linden” commercial property was eventually sold under false pretenses at nearly one half of the appraised value of nearly one and a half million dollars, as stated infra and in furtherance of the RICO scheme plead in the within complaint.

379.

To be sure, the “loans” defendant Fabian was seeking urgent repayment for - in

furtherance of the RICO scheme plead herein - were allegedly made in the early nineties and consisted of only one hundred fifty thousand dollars. See Count I, ¶200.

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380.

However, with interest the “loans” allegedly ballooned to over three hundred

thousand dollars - and defendants Fabian, Capece, Rajs et al were all of the view that these outdated, undocumented, and disputed debts should nonetheless be prioritized over plaintiff’s interests.

381.

The deferred “consulting” fees Mr. Fabian also sought to urgently prioritize and pay

himself, consisted of an illicit “deferred compensation” scheme whereby Mr. Fabian sought repayment of fees related to “consulting” work which allegedly took place between 2008 through 2012, prior to decedent's passing. See Count I, ¶200 (second page of graphic illustration).

382.

Mr. Fabian has been unable in six years to produce any documentation whatsoever

substantiating this “consulting” work, and has given scant detail explaining same.

383.

Moreover, as explained supra, a memorandum obtained from Sun National bank

suggests that the consulting fees Mr. Fabian sought for 2008 and 2009 were non-existent, as he was not employed as a consultant during that time, having “recently” been hired in 2010 per the statements attributed to defendant Laurence Gold in the said Sun Bank memorandum.

384.

Notwithstanding the foregoing, Mr. Fabian decided at the “crisis “ meeting to sell the

“Linden commercial property” - under false pretenses.

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385.

With the assistance inter alia of defendants Capece and Rajs, Mr. Fabian then sought

to create the pretext for the “urgent” sale under false pretenses.

386.

Specifically, Mr. Fabian claimed that the property had significant environmental

damage, and that it would eventually lose its sole tenant.

If the tenant left, defendants

claimed, the property would be unrentable.

387.

However, these concerns were never an issue prior to the June 27, 2013 crisis meeting

and the Sun Bank lawsuit, as in fact prior to that date defendants were seemingly accepting that the commercial property was and will continue to be profitable.

388.

Moreover, the tenants in the property were business acquaintances of defendant

Fabian, as he was the de facto president or owner of Morey La Rue prior to the October 2011 transfer of the“Linden” property to Toben.

389.

Said tenants, in fact, eventually in 2014 purchased the commercial property at

significant discount, nearly one half of the appraised value of 1.5 million dollars.

390.

It is thus likely that Mr. Fabian colluded with said tenants to create the issue of the

environmental damage in order to sell the property at discount, potentially receiving a “kick back” in the process.

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391.

In fact, the October 15, 2013 appraisal ordered by defendant Leah Capece at the

request of Mr. Fabian, and which resulted in the 1.5 million dollar valuation, did not reference environmental damage - since there was no such environmental damage.

392.

The appraisal also notably indicated that the property was not being “aggressively

marketed” by defendants.

393.

Indeed, over one year prior to the appraisal, the New Jersey State Environmental

Protection agency in or about May 2, 2012 issued a “No Further Action” letter unequivocally setting forth the lack of any significant environmental hazards.

394.

Although a February 2014 study by the engineering firm AECOM found possible

“recognized environmental conditions,” or REC, at the said Linden Property, that finding was based on an underground storage tank for which there was no documentation - it was not a substantive finding of an environmental hazard.

395.

Thus, the firm AECOM in a February 2014 memorandum unequivocally stated that

the REC, or recognized environmental condition assessment, would stand “until documentation can be obtained to confirm the use of this former tank.”

396.

Ergo, this was not a finding of a substantive environmental damage which required

remediation or would render the property uninhabitable or otherwise unrentable.

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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397.

As such, there was no “environmental condition” which would warrant the sale of this

profitable asset.

398.

A fortiori, there was no “environmental condition “ which could substantiate a “fire

sale” of this asset at one half of the appraised value of nearly 1.5 million dollars.

399.

In representing to the plaintiff and the Court that the property contained such

significant environmental damage, defendants Capece, Fabian et al committed actionable fraud in furtherance of the purposes of the within RICO scheme.

400.

This fraud resulted in plaintiff losing her 51% stake in the lucrative “Linden”

commercial property, including its yearly rental income of nearly three hundred thousand dollars, for a total loss of over 150K per annum in profit, and a total loss of nearly 800K in capital.

401.

Unafraid of the consequences, defendants Fabian and Capece unapologetically in or

about April of 2014 sold the said lucrative “Linden” commercial property to the tenants of the property, who were former business acquaintances of Mr. Fabian, at nearly one half the of the appraised value of 1.5 million dollars, thus resulting in significant loss to the plaintiff.

IX. Tolling of the RICO Statute of Limitations Fraudulent Concealment and Duress - Plaintiff’s Exercise of Due Diligence Tolling By Pendency of State Court Lawsuit, Filed April of 2014 Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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(i) Summary of Tolling Allegations and Preliminary Comments 402.

Pre-litigation, the statute of limitations (“SOL”) was tolled inter alia by way of

duress at the June 27, 2013 “crisis” meeting (“it’s sink or swim time”, “you’ve got to listen to her”, the “company will cease to exist by next week”), and by the unlawful discharge of plaintiff in late December 2013 in retaliation for her whistleblower activity. The said December 2013 retaliatory discharge was meant to discourage plaintiff from filing suit (by inter alia sending her a stern warning and cutting of her source of income) and the June 27, 2013 duress was meant to compel plaintiff to “join” the defendants in their RICO scheme to defraud banks. The June 27, 2013 “crisis” meeting also sought to “hide” the fraud in plain sight by nonchalantly acting as if though the fraud was an acceptable way of doing business.

403.

Litigation Fraud. SOL was tolled inter alia by the four frivolous, baseless, and

retaliatory litigation acts referenced at Count IV (CEPA and Pierce) , ¶76 to ¶123, which constituted a litigation tactic clearly designed to cause emotional distress of the plaintiff in an effort to dissuade her from continuing with her lawsuit.

These litigation acts

included deliberately withholding plaintiff’s monetary distribution from the estate, the filing of motion papers in January of 2015 which served as a warning to plaintiff that her 40% shares in her late husband’s company would be sold unless she dropped the lawsuits, and the filing of frivolous pleadings in 2017 and in 2018 which also sought to warn plaintiff that the sale of her 40% stake in her late husband’s company was imminent unles she dropped her lawsuits. The said frivolous pleadings - which included baseless allegations blaming plaintiff for her firing and allegations which argued that her complaint(s) lacked merit - also had the goal of hiding the fraud in plain sight by frivolously arguing that there was no fraud which merited plaintiff’s lawsuits.

404.

The SOL was further tolled by the filing of the plaintiff’s lawsuit in April of 2014

and, post-litigation, by defendant Fabian’s blatant perjurious reversal regarding the fraudulent weekly 2K payroll payments he had been receiving since plaintiff’s husband Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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passed in 2012.

Specifically,

despite having dramatically r epeatedly admitted

pre-litigation that the weekly payments (both current and prospective) were in satisfaction of an illicit $602,200.00 debt, post-litigation Fabian denied same under oath, thereby fraudulently concealing the fraud.

405.

The Specifics, Preliminary Comments. There has been frivolous and downright

outrageous fraudulent concealment and duress in the case sub judice since 2013, and particularly since the filing of plaintiff’s state court lawsuit in 2014, motivated by the defendant’s attempts to take advantage of plaintiff widow, who is a school teacher, in order to disguise their fraud and/or threaten her with disinheritance in the event of her continued whistleblower activity.

406.

In fact, during the pendency of the within federal litigation, defendant Fabian and

other named and unnamed co-conspirators exercised further duress and/or fraudulently concealed the RICO scheme by, once again (for the third time), attempting to completely disinherit plaintiff in retaliation for her fraud lawsuits, in violation of inter alia CEPA and Pierce’s prohibition on retaliatory acts which violate public policy.

407.

Specifically, on October 16, 2018, defendant Fabian and other named and unnamed

co-conspirators filed a verified complaint purporting to sell plaintiff’s minority share in her late husband’s company in retaliation for the filing of the federal and state complaint(s). In so doing, defendant Fabian and his co-conspirators explicitly fraudulently attempted to conceal the illicit RICO scheme by frivolously arguing that plaintiff’s whistleblower activity is unlawful, i.e. that defendants committed no fraud

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(image of Oct 16, 2018 Verified Complaint Page 6 and Verification signatures below)â&#x20AC;&#x2039;:

408.

Prior to this October 2018 pleading, and prior to the filing of plaintiffâ&#x20AC;&#x2122;s State Court

Complaint, defendants attempted further duress and fraudulent concealment.

(ii) Pre-litigation Duress and Fraudulent Concealment from 2012 through April of 2014 tolls the RICO Statute of Limitations Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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409.

Widowed plaintiff school-teacher (who has no business or legal background) was

employed at her former husband’s company, THC, from circa November 2012 through December 2013, during which time she suspected rampant fraud, particularly in light of the June 25, 2013 “Sun Bank fraud lawsuit”, which defendants Fabian and Capece misrepresented to plaintiff as having resulted primarily because of the death of her late husband, and not because of their own fraud as had been alleged.

410.

The June 27, 2013 “crisis” meeting misrepresentations were among the first such

misrepresentations which tolled the statute of limitations.

411.

The June 27, 2013 “crisis” meeting itself, which lasted well over one hour, was

replete with an assortment of outrageous admissions, misleading innuendo and hyperbole, tactical misrepresentations, and brazen fear-mongering.

412.

These tactics were designed both to fraudulently convince the plaintiff that the fraud,

if any, was benign and necessary, and also that her failure to “cooperate” would essentially be catastrophic, e.g. duress.

413.

Thus the June 2013 “crisis” meeting (attended inter alia b y defendants Gold, Fabian,

and Capece) constituted a hodgepodge of admissions and misleading attempts to “conceal” these admissions through misdirection and fear-mongering, thereby tolling the statute of limitations as a result of duress and fraudulent concealment by defendants -

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namely defendant Fabian and his former counsel.

414.

Some of the admissions made at this “crisis” meeting were that: We’re not reporting

anything to anybody at the end of the day….. I don’t know why I let you record this, but you better erase that part……. .you know how Todd owes me all this money, right? If I put that on the corporate books, then Sun Bank would never have loaned us a dime or Wells Fargo. If I put that on the books now, Wells Fargo won’t make the loan. So I have to keep everything from me off the books….

415.

However, these admissions were followed by dramatic warnings - e.g. duress -

regarding plaintiff’s purported duty to go along with this fraud scheme, or to suffer the consequences of her inaction or failure to participate.

416.

Thus, Mr. Fabian’s then-counsel and defendant herein, either at the direction of Mr.

Fabian or of her own volition, admonished plaintiff of the consequences of plaintiff’s failure to participate in the fraud by uttering the following outrageous statements: “This is an emergency meeting because there is a crisis here”, “if we don’t do something today, by the end of next week the Todd Harris Company will cease to exist”, “Todd Harris Company can be closed by the end of next week or we can make tough decisions today with your support and your assistance…”, “Sun Bank has brought these proceedings….and they’re going to do everything in their power…..including destroying this company in a matter of weeks” , “even repaying this debt, it’s still possible that they could still be criminally prosecuted…”, “[w]e want you to understand what’s going on

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and we want you to support us in this” and “it’s sink or swim time”

417.

Mr. Fabian made it clear during this meeting that plaintiff should participate in this

scheme, by uttering inter alia, “you’ve got to listen to [my attorney]” in reference to the statements made by said attorney (e.g., “it’s sink or swim time”).

418.

The “Sun Bank lawsuit” which prompted the crisis meeting, and which could

presumably result in the demise of the company, at the time of the meeting was only a few days old.

419.

Mr. Fabian thus uttered at this meeting, in a further warning to plaintiff, that: “We’re

screwed because of the actions we took back in November..”, “We’re in real trouble”, “they’re threatening to file criminal charges”, “You got to listen to [my attorney Capece]”.

420.

The plaintiff at this time was, to say the least, confused and overwhelmed. She could

not commit to participating in the fraud, and she wasn’t ready to harm her own company and her children’s inheritance - she needed to find a lawful way to ascertain the health of the company and help the company succeed.

421.

Plaintiff shortly after this June 27, 2013 “crisis” meeting thus understandably needed

further counseling, process, and discovery to ascertain her rights and the extent of any damages to her and/or the estate. Given that everyone at THC, including the seemingly

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trusted company CPA Laurence Gold, seemed to tag along with this “sink or swim” scheme, plaintiff was genuinely not aware of anything at this point, much less any injury to her.

422.

To the extent she was suspicious of any injury to her during the “crisis” meeting, it

was made abundantly clear to her that any attempts to disclose the fraud would result in self-inflicted harm to her and her children’s inheritance.

423.

Subsequent to this meeting, plaintiff started spending more time at her husband’s

company, and became aware of further fraud which she tried to remedy by implementing new policies.

424.

She also began to suspect that the payment by Mr. Fabian to himself of a purported

$602,200.00 debt, which debt lacked any proofs whatsoever, was fraudulent - particularly since he was being paid said debt by placing himself on the payroll of the company at the rate of $2K per week, a fact he routinely admitted until plaintiff filed suit in April of 2014.

425.

As a result of her suspicions regarding fraud, plaintiff and her attorney held a meeting

with Mr. Fabian and others in August 2013 to discuss inter alia the payroll fraud - and Mr. Fabian at this meeting nonchalantly admitted same - except that he claimed the debt was being paid on the payroll for administrative purposes, and not to conceal the debt from the world.

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426.

However, this qualification to this admission, that it was for “administrative”

convenience, did not comport with his statement in June of 2013 that “at the end of the day we are not reporting anything to anyone.”

427.

Shortly afterwards, in December of 2013, plaintiff was fired from the company

because, inter alia, she “stared” at one employee and, according the company employee themselves, because she was “digging for dirt”.

428.

The firing was thus clearly retaliatory - and meant to send plaintiff a warning that she

should not blow the whistle.

429.

Strategically, the firing was also meant to cut of plaintiff’s source of funding for the

lawsuits. This strategy of refusing to provide plaintiff monies for potential litigation is also evident in the defendant’s failure to provide a monetary distribution in six years, in their failure to fund the trust of which plaintiff is a beneficiary, and in their tactic of filing frivolous pleadings to disinherit plaintiff which would prove costly to defend, particularly for a widow with a school teacher salary.

430.

The foregoing pre-litigation acts constitute duress and fraudulent concealment which

toll the RICO statute of limitations.

(iii) Litigation Fraud: Concealment and Duress, defendant’s abrupt reversal after the filing of plaintiff’s complaints regarding the payroll payments. Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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431.

After the filing of the State Court complaint, the fraudulent concealment consisted

inter alia o f defendant Fabian’s blatant attempts (perjury) to recant on prior (compelling) admissions regarding the payroll fraud, and instead arguing that the payroll payments he had been receiving were for bona fide work, and not for repayment of the disputed $602,200.00 “off-the-books” debt as he and defendant Capece had clearly and repeatedly articulated previously.

432.

In addition, the litigation-based fraudulent concealment and duress encompassed

defendant’s attempts to disinherit plaintiff by making efforts, under false pretenses, to sell her minority share ownership starting in January of 2015, and then explicitly in two pleadings in August of 2017 and in October of 2018. See, Count IV (CEPA and Pierce), ¶76 to ¶123.

433.

Defendants also committed further duress by deliberately withholding distribution

from the Estate and from a Testamentary Trust, of which plaintiff is a beneficiary, in order to avoid financing her litigation.

434.

The plaintiff hereby repeats and avers Count IV (CEPA and Pierce), ¶76 to ¶123, as

if fully set forth herein.

435.

The allegations at Count IV (CEPA and Pierce) , ¶76 to ¶123 depict a continuing

violation, a pattern, of inter alia baseless and frivolous pleadings, which had as a goal Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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inter alia t he emotional and financial harm of plaintiff, in the form of a threat to disinherit her and in the form of additional excessive attorney’s fees this widow-school teacher would have to spend to defend same, in an effort to compel her to drop her lawsuit and by (plausible) extension in an effort to prevent her from filing any RICO-based actions.

436.

Furthermore, the acts alluded to at Count IV (CEPA and Pierce) , ¶76 to ¶123 had as a

goal the fraudulent concealment of the fraud, in plain sight, in the form of the defendant’s insistence (particularly defendant Fabian and his current counsel, not a party herein), that they had committed no wrong, that there was no fraud.

437.

The foregoing acts, including the expensive and emotional frivolous pleadings to

disinherit plaintiff, as well as defendant Fabian’s perjury after the filing of the complaint regarding his payroll payments, amount to litigation-based fraudulent concealment and duress which tolls the statute of limitations.

(iv) Motion to Quash Subpoena (Fraudulent Concealment) 438.

In late 2017, defendant Capece filed a frivolous motion to quash a Wells Fargo

subpoena which would have substantiated bank fraud. 439.

The motion, which the state court has not decided and in 2018 claimed was

“missing”, was based on defendant’s argument that plaintiff - having executed previously a non-disclosure agreement - had to execute a second non-disclosure agreement to obtain lawful discovery from third parties.

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440.

Said motion was frivolous - and amounts to fraudulent concealment o f the Wells

Fargo bank fraud admitted by defendant Fabian in June of 2013 at the “crisis meeting”, and corroborated by two banker depositions in early 2018.

441.

This litigation-based fraudulent concealment tolls the RICO statute of limitations.

(v) Duress by Deliberate Failure to Disburse Funds to Plaintiff from the Estate or the Testamentary Trust 442.

As stated throughout this complaint, and in particular at Count IV (CEPA and

Pierce) , ¶76 to ¶123, defendants have made tactical use of plaintiff finances - or lack thereof - in an effort to prevent her from obtaining the monies necessary to finance her lawsuit.

443.

Plaintiff, a widowed school teacher with a modest salary, has been subject to the

following deliberate financial losses at a consequence of defendant Fabian’s deliberate actions: (i) they misappropriated 401K funds worth 100K, (ii) they fired her from the company in 2013 (iii) they have failed to distribute monies from the estate to plaintiff for over six years, and (iv) they have failed to create and finance a testamentary trust of which she is a beneficiary.

444.

Most, if not all, of these acts by defendants had as their goal preventing plaintiff from

acquiring funds needed to finance the litigation.

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445.

By imposing these financial burdens on plaintiff, defendants fraudulently concealed

their fraud in that it became more difficult for plaintiff to proceed with her litigation or efforts to uncover the fraud. 446.

The foregoing thus tolls the RICO statute of limitations.

(vi) Pendency of Court Action Tolls the Statute 447.

It is respectfully submitted that the mere filing of plaintiff’s state court complaint

circa April of 2014 tolled the statute of limitations.

(vii) Plaintiff’s Due Diligence in Light of the Fraudulent Concealment 448.

Plaintiff exercised a superb level of due diligence in the case sub judice - but her

efforts were routinely thwarted by defendants by cutting of all of her sources of funding (THC employ, distribution from the trust, distribution from the estate, and ownership of shares) and by virtue of their duress (drop the lawsuit or you lose your shares), by virtue of their outrageous forms of fraudulent concealment (frivolous motion to quash, refusal to produce the company accountant for a deposition, the abrupt denial after the filing of the complaint by Mr. Fabian regarding compelling admissions he had made in relation to the payroll fraud), et al.

449.

Thus plaintiff served defendants with interrogatories and took their depositions,

pre-litigation she lawfully recorded nearly a dozen hours of their statements (“wiretaps”), notices to produce and subpoenas were served, et al.

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450.

The Wells Fargo subpoena - served in mid-2017 - was the subject of a frivolous

motion to quash - same would have yielded valuable information regarding the 2013 Wells Fargo fraud (the State Court has not decided the motion, and therefore the records have not been released - in August of 2018 the State Court claimed the motion was missing, and in November of 2018 the Court refused to issue a ruling on the motion in order to permit the records to be released).

451.

The deposition of the company accountant Laurence Gold - perhaps the most

significant deposition in this case - has not taken place as his State Court counsel indicated that she would not produce him until a motion to sequester his prior pre-litigation counsel was decided. Said motion was filed in mid-2017, and to this date the State Court has not decided same (and apparently has no plans to do so).

452.

Regarding the payroll fraud - Mr. Fabian and his prior counsel both routinely

admitted that his THC payroll salary was fictitious - that he was receiving a 2K weekly check in order to be repaid a $602,200.00 which lacks any proofs whatsoever.

453.

After the litigation, however, Mr. Fabian claimed that the “changed his mind” (at

some unidentifiable date), and that he started receiving the checks as remuneration for actual work. He was unable to provide the date of this “change of mind” and to date has not set forth the specifics of the alleged work he is being paid for.

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454.

The foregoing reflects the degree of “due diligence” necessary for plaintiff to invoke

the “fraudulent concealment” tolling doctrine.

(viii) The Litigation Fraud, Predicate Act VI, Depicts a New RICO Pattern and a New Injury, which started the Statute Anew 455.

The state court litigation in the case sub judice began in April of 2014.

456.

Since then, the defendants and their attorney(s) (particularly defendant Fabian and his

attorney) have engaged in new activity, distinct from the pre-litigation activity, which has created new injuries/damages, and constitute a new RICO pattern/scheme.

457.

The injury, in the form inter alia of nearly 500K paid to Mr. Fabian’s counsel, was

not known to plaintiff until the accountings were submitted in Court.

458.

The first such accounting was filed on or about February 6, 2015.

459.

Plaintiff at this time first became aware of the extent of fees being paid to Mr.

Fabian’s counsel.

460.

Since the litigation began, the new forms of racketeering include those set forth at

Predicate Act VI, and specifically: the January 2015 motion opposition papers in which the executor threatened to disinherit plaintiff (sell her shares) because of her behavior while an employee at THC (although she had been fired), the August 2017 Verified

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Complaint in which Mr. Fabian again threatened to sell plaintiff’s minority shares - this time invoking as a reason therefore her state court litigation, and the October 2018 verified complaint in which Mr. Fabian and his counsel sought the same relief (de facto disinheritance) - this time invoking the Federal lawsuit as a reason therefore.

461.

The foregoing constitutes a new RICO pattern with new RICO injuries.

462.

The statute of limitations for the litigation fraud thus commenced in or about

February of 2015 as it relates to the litigation fraud RICO pattern of racketeering. . X Noerr-Pennington Doctrine and Litigation Privilege Exceptions November 12, 2018 Amendments to Litigation Fraud Predicate Act VI: The litigation fraud by defendants was objectively baseless and defendants subjectively intended to harm the plaintiff through the abuse of a governmental process itself, as opposed to harms flowing from the outcome of that process.

463.

The plaintiff repeats and averts Count IV (CEPA and Pierce), ¶76 to ¶123, as if fully

set forth herein.

464.

Count IV (CEPA and Pierce) , ¶76 to ¶123 inter alia set forth allegations for the

“sham” exception to Noerr-Pennington doctrine in the context of the CEPA and Pierce claims, and in doing so the following four acts by defendant Fabian and his counsel (a FRCP 19(c) “unindicted co-conspirator”) became pivotal as regards the said sham exception:

465.

(i) Defendant Fabian’s deliberate act for six years, including during litigation, to

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avoid giving plaintiff any monies from her late husband’s estate in retaliation for - and to circumvent - her whistleblower lawsuits

466.

(ii) Defendant Fabian’s opposition to plaintiff’s motion in January of 2015 seeking

her 40% shares. In that opposition, Mr. Fabian (and his counsel) frivolously relied on the May 2014 THC employee-affiant’s affidavits to argue that plaintiff’s acts while an employee at THC, which included a “staring” incident and other whistleblower-based acts, merited the sale of plaintiff’s 40% stake in the company - notwithstanding that she had previously been repeatedly assured ownership of the shares before she “blew the whistle” with her lawsuit, notwithstanding that she was no longer an employee at the company since she had been fired in December of 2013, notwithstanding that it was her late husband’s undisputed intent that she inherit the 40% shares through the residuary clause of his will, notwithstanding that a 40% stake in a company gave the shareholder no control to do anything within the company - much less “destroy” same, and notwithstanding that it was unlawful to prospectively circumvent potentially nonexistent minority shareholder suits by selling the shares to another party (which third party could nonetheless also file such suits).

467.

(iii) Defendant Fabian’s August 2017 verified complaint seeking leave to sell her

40% shares. In that August 2017 pleading, Mr. Fabian (and his counsel) frivolously relied on the May 2014 THC employee-affiant’s affidavits to argue that plaintiff’s acts while an employee at THC, which included a “staring” incident and other whistleblower-based acts, merited the sale of plaintiff’s 40% stake in the company -

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notwithstanding that she had previously been repeatedly assured ownership of the shares before she “blew the whistle” with her lawsuit, notwithstanding that she was no longer an employee at the company since she had been fired in December of 2013, notwithstanding that it was her late husband’s undisputed intent that she inherit the 40% shares through the residuary clause of his will, notwithstanding that a 40% stake in a company gave the shareholder no control to do anything within the company - much less “destroy” same, and notwithstanding that it was unlawful to prospectively circumvent potentially nonexistent minority shareholder suits by selling the shares to another party (which third party could nonetheless also file such suits).

468.

(iv) Defendant Fabian’s October 2018 verified complaint seeking leave to sell her

40% shares. In that pleading, which characterized the within Federal lawsuit as the “best evidence” in support of their alleged quest to sell her shares, Mr. Fabian (and his counsel) frivolously relied on the May 2014 THC employee-affiant’s affidavits to argue that plaintiff’s acts while an employee at THC, which included a “staring” incident and other whistleblower-based acts, merited the sale of plaintiff’s 40% stake in the company notwithstanding that she had previously been repeatedly assured ownership of the shares before she “blew the whistle” with her lawsuit, notwithstanding that she was no longer an employee at the company since she had been fired in December of 2013, notwithstanding that it was her late husband’s undisputed intent that she inherit the 40% shares through the residuary clause of his will, notwithstanding that a 40% stake in a company gave the shareholder no control to do anything within the company - much less “destroy” same, and notwithstanding that it was unlawful to prospectively circumvent potentially

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nonexistent minority shareholder suits by selling the shares to another party (which third party could nonetheless also file such suits).

469.

As set forth at Count IV (CEPA and Pierce), ¶76 to ¶123, these four litigation tactics

were baseless and meant to harm plaintiff in themselves, regardless of the outcome, particularly in light of defendant’s offer to plaintiff of nearly complete control of the company during mediation, see Count IV, ¶94-¶95. (As set forth at Count IV, ¶92-¶93, the mediation privilege was pierced/breached/waived by defendants in October of 2018).

470.

The foregoing is a plausible interpretation of facts which gives rise to the “sham”

exception to Noerr-Pennington immunity of Mr. Fabian, as well as his counsel, who has not been named a party in order to avoid disrupting the Estate Litigation. FRCP 19(c).

471.

Moreover, malice and intent of the defendants (particularly of Mr. Fabian and of the

“unindicted co-conspirator” - his current counsel) may be alleged generally per the Rules of Court. FRCP (9)(c) “In alleging fraud or mistake, a party must state with particularity the circumstances constituting fraud or mistake. Malice, intent, knowledge, and other conditions of a person's mind may be alleged generally.”

472.

As to the litigation privilege, same is pierced as to William P. Fabian and his counsel,

because these four litigation tactics are not merely statements meant to harm plaintiff emotionally - they are also meant to harm plaintiff economically, as depicted inter alia by their failure to provide plaintiff with a distribution from her husband’s estate for over six

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years.

473.

As to defendant Leah Capece, and her filing of the frivolous “Wells Fargo” motion to

quash the subpoena, same is not protected under Noerr-Pennington because her client, THC, was not a named party in the litigation and her decision to participate was her own, and/or a result of Mr. Thomas Howard (Mr. Fabian’s counsel), decision to delegate most litigation tasks to her.

474.

To the extent Noerr-Pennington or the litigation privilege applies, the later is not

applicable because the frivolous motion to quash the Wells Fargo subpoena (which over one year later the Court has yet to rule on) is not a mere defamatory statement - it is an act in furtherance of the overall scheme to conceal fraudulent activity, particularly as it relates to the payment to Mr. Fabian of his illicit and disputed $602,200.00 debt.

475.

The Noerr-Pennington sham exception applies to this frivolous Wells Fargo motion to

quash because the motion was meant to harm plaintiff further by imposing additional financial burdens to an already cash-strapped widow in order circumvent her discovery of the fraud. E.g., it was filed with malice. FRCP 9(b). XI.

November

476.

12, 2018 Amendments Regarding RICO Injury and RICO Standing The following non-exhaustive facts/plausible allegations establish plaintiff’s RICO

Injuries:

477.

(i) Defendant Fabian, Rajs, and Keh in or about September 2013 misappropriated one

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hundred thousand dollars from decedent’s 401K plan, which monies were in fact the property of plaintiff as decedent’s surviving spouse, and would have been distributed to her outside of probate.

478.

(ii) 51% of the 1.5 million dollar “Toben Property”, as well as 51% of its 300K

yearly rental income, would have been the property of plaintiff pursuant to the residuary clause in decedent’s will, but for defendant Fabian’s scheme to pay himself his $602,200.00 illicit indebtedness, which resulted in the sale of the property in April of 2014.

479.

(iii) The illicit $602,200.00 indebtedness Mr. Fabian paid himself, with the aid of

defendants Gold, Rajs, and Capece, resulted in the loss of profit which would have been distributed 60% to the Testamentary Trust of which plaintiff is a 15% beneficiary, and 40% to plaintiff by virtue of her 40% stake in the company, for a total loss to plaintiff of 55% of $602,200.00, or $331,210.00.

480.

(iv) Mr. Fabian paid his litigation counsel in excess of $500,000.00 in order to file

frivolous pleadings to circumvent plaintiff’s fraud lawsuit(s). This money was paid from Estate money which would have otherwise been transferred 15% to plaintiff by way of the testamentary trust, and 40% by way of her direct ownership of the company.

481.

As to standing to sue, plaintiff is a 15% beneficiary of a testamentary trust which

owns, or but-for-defendant’s fraud should own, 60% of the shares of the Todd Harris Company. In addition, but for defendant’s fraud and their attempts to sabotage her lawsuits, she would own 40% of the shares and have further standing accordingly.

XII. November 12, 2018 Amendments to Predicate Act VI, ¶277 et seq: New Litigation Fraud Since the Filing of the Complaint, et al.

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482.

The June 2018 complaint referenced only the August 2017 “motion” (now amended

to reflect a “pleading”) to disinherit plaintiff by selling her non-controlling minority stake in her late husband’s company, THC.

483.

The within November 12, 2018 amendments reference two new instances wherein an

“attempt”, specious or otherwise, was made to disinherit plaintiff: the January 2015 motion opposition (which marks the first time plaintiff became aware of the threat to sell her shares), and the October 2018 verified complaint (“pleading”), which sought once again to threaten plaintiff with the sales of her shares.

484.

The October 2018 pleading referenced the within Federal lawsuit as the “best

evidence” to disinherit plaintiff.

485.

addition, on July 30, 2018 Mr. Laurence Gold submitted in State Court a sworn

certification in which he claimed to be unaware of the 2013 Sun Bank Lawsuit.

486.

In fact, as Mr. Gold’s invoices and recordings show, he was in fact present at the

“crisis” meeting of June 27, 2013, which meeting was precipitated by the Sun Bank lawsuit, and in which meeting they thoroughly discussed same.

487.

Moreover, Mr. Gold witnessed a 350K promissory note/lien, payable to the order of

Mr. William P. Fabian, in consideration for the monies Mr. Fabian loaned the company (THC), to settle the Sun Bank Lawsuit.

488.

As such, Mr. Gold’s certification constitutes unequivocal perjury.

WHEREFORE plaintiff demands judgment on Count I (RICO) against defendants for: A. COMPENSATORY DAMAGES: THE SUM OF TWENTY MILLION DOLLARS AS FOLLOWS :

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a. Fabian Payroll Fraud Losses - Seven Hundred Thousand Dollars b. Toben Property Firesale Capital Loss - Eight hundred thousand dollars c. Prospective Damages: Toben Property Profit Loss - Over Three Million Dollars d. Payment of Fictitious Toben Salaries - over two hundred thousand dollars. e. Frank Rajs Salary Increase - nearly three hundred thousand dollars to date. f. 401K Damages - One Hundred Thousand Dollars g. Attorney’s Fees paid to defense counsel in State Court - Over One Million Dollars h. Plaintiff’s Attorney’s Fees relative to State Litigation - Over One Million Dollars i. Back pay from December 2013 to present relative to plaintiff’s employment at the Todd Harris Company - $400,000.00. j. Total: RICO Treble Damages of above amounts, to wit, Twenty Million Dollars. B. Punitive Damages in the amount of twenty million dollars C. Plaintiff’s attorney’s fees for the present action D. Reinstatement of plaintiff to her former employment at the Todd Harris Company. E. Such other relief as the Court deems proper.

COUNT II. COMMON LAW FRAUD

1. Plaintiff repeats and avers the allegations in Count I, ¶1 to ¶486, as if fully set forth herein.

2. The instances of fraud plead therein constituted common law fraud. Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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3. Specifically, defendants Rajs, Cecilia Keh, and Fabian are liable for conversion because of their misappropriation of plaintiff’s 401K funds, worth over 100K. See Predicate Act V, Count I, ¶229 to ¶236.

4. Defendant William P. Fabian is liable for said conversion because he personally instructed Rajs and/or Keh to transfer the 401K funds and then withdraw same.

5. All defendants are liable for the misappropriation of $602,200.00 by defendant Fabian for payment of an illicit debt, by placing himself on the payroll of THC.

6. Specifically, Mr. Fabian and Ms. Capece admitted that the 2k weekly payments on the payroll were not really payroll payments but were instead “repayment” of the illicit $602,200.00 debt to Mr. Fabian.

7. Mr. Gold participated in this fraud by knowingly preparing false tax returns which depicted these payroll payments as actual payroll payments - and not repayment of a debt.

8. Further, Mr. Gold knowingly omitted said $602,200.00 debt in the books and records of the company, in a further effort to conceal same.

9. Defendants Keh and D’Ambrosio, familiar with the finances of the company (THC), knowingly assisted Mr. Gold in hiding this debt, as depicted inter alia by an email Mr. Gold sent to Mr. D’Ambrosio in which email he stated that raw company data was to be concealed from plaintiff.

10. Ms. Capece knowingly assisted Mr. Fabian in hiding the debt in “plain sight” by preparing minutes of the board which ratified the weekly payroll payments.

11. The affiant defendants assisted Mr. Fabian in creating a ruse, a distraction, for plaintiff’s Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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whistleblower activities (which included the payroll fraud per an August 2013 meeting she had with Mr. Fabian and others).

12. Specifically, the “affiant” defendants knowingly signed specious affidavits which purported to assassinate plaintiff’s character by referencing inter alia a “staring” incident in support of Mr. Fabian’s contention that plaintiff would “destroy” the company - the sole purpose of this ruse was to undermine plaintiff’s character to further conceal inter alia the payroll fraud.

13. As to the Toben Property - which was sold at half of its appraised value of 1.5 million, defendants Fabian and Capece are the primary actors and committed common law fraud by, inter alia, misrepresenting the environmental condition of the property in order to effect a quick sale which would benefit only defendant Fabian.

14. The litigation fraud constituted common law fraud in that defendant Fabian deliberately committed perjury by mischaracterizing his payroll payments as bona-fide-payroll payments, notwithstanding that prior to litigation he had dramatically and convincingly admitted that the payroll payments were fictitious.

15. Moreover, Mr. Gold committed perjury as late as July 30, 2018 by knowingly submitting a certification to the Court in which he claimed to be unaware of the 2013 Sun Bank Lawsuit - against the overwhelming weight of the evidence which proves otherwise.

16. Mr. Fabian, Mr. Gold, and Mr. Rajs committed common law fraud by knowingly producing a fictitious employment agreement to justify the payroll payments Mr. Fabian had been receiving (which per compelling and repeated admissions by Mr. Fabian and Ms. Capece were actually for repayment of a debt, not for actual work under any purported agreement).

17. Mr. Fabian (and his counsel, not a named party) in August of 2017 and October of 2018 committed common law fraud by knowingly filing in Court, under false pretenses, Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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employment-based-affidavits in support of the non-sequitur that plaintiff school teacher could “destroy” the company with a non-controlling 40% interest in same notwithstanding that the “incidents” referenced in the affidavits were either benign (e.g. she “stared” at someone once) and/or salutary (e.g. fraud curbing policies protected under the whistleblower statute). Defendant Fabian (and his counsel), were also aware that plaintiff had been fired from the company - and therefore could no longer “stare” at employees in a manner that endangered the company or its employees.

18. As to the statute of limitations and tolling, the tolling arguments regarding the RICO Count, to wit, fraudulent concealment, duress, and the pendency of another Court action are applicable to the within claims in this Count. See Count I, ¶400-460. 19. As to the Litigation Privilege, the litigation acts were not merely defamatory statements, they were acts, and the “sham” exception applies, since the litigation fraud was baseless and was meant to harm plaintiff with the process itself. See Count I, ¶461-473.

WHEREFORE plaintiff demands judgment on Count II against defendants for: A. COMPENSATORY DAMAGES: THE SUM OF EIGHT MILLION DOLLARS AS FOLLOWS : a. Fabian Payroll Fraud Losses - Seven Hundred Thousand Dollars b. Toben Property Firesale Capital Loss - Eight hundred thousand dollars c. Prospective Damages: Toben Property Profit Loss - Over Three Million Dollars d. Payment of Fictitious Toben Salaries - over two hundred thousand dollars. e. Frank Rajs Salary Increase - nearly three hundred thousand dollars to date. f. 401K Damages - One Hundred Thousand Dollars g. Attorney’s Fees paid to defense counsel in State Court - Over One Million Dollars Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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h. Plaintiff’s Attorney’s Fees relative to State Litigation - Over One Million Dollars i. Back pay from December 2013 to present relative to plaintiff’s employment at the Todd Harris Company - $400,000.00. B. Punitive Damages in the amount of twenty million dollars C. Plaintiff’s attorney’s fees for the present action D. Reinstatement of plaintiff to her former employment at the Todd Harris Company. E. Such other legal and equitable relief as the Court deems proper. COUNT III DEFAMATION

i. Introduction- Defamatory statements made by defendant Fabian, the “Affiants”, and defendant Rajs, in the course of firing plaintiff in 2013 and in the course of filing a motion in 2017 to disinherit plaintiff 1. Plaintiff repeats and avers the allegations in this complaint, ¶32 to ¶37, as if fully set forth herein.

2. As stated therein, plaintiff on December 4, 2013 was unlawfully discharged from a job she held at her former husband’s company, The Todd Harris Company (“THC”).

3. Plaintiff’s unlawful discharge inter alia resulted from defamatory statements made by defendants that she would “destroy” the company if she were permitted to remain employed there.

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This was particularly evident in a May 2014 affidavit by defendant Fabian, filed in State Court in late 2017, in which he alluded to “staring” incidents - and other similar benign acts - which would purportedly “destroy” the Todd Harris Company if plaintiff were permitted to work there.

5. These defamatory statements were motivated by defendant’s whistleblower animus towards plaintiff, as well as her whistleblower acts or omissions while employed at the company between November 2012 through December 4, 2013.

6. In addition to defamatory allegations about plaintiff’s ability to “destroy” a multi-million dollar company by “staring” at its employees, the staff at the Todd Harris Company were also misled to believe that plaintiff would “take over” the company and cause the firing of its de facto president, defendant Frank Rajs, despite her non-controlling 40% stake in the company, and notwithstanding that she was not an officer or a manager.

7. Further, in or about mid-2013 defendants further defamed plaintiff by spreading the word within the Todd Harris Company that she had failed to provide a personal guarantee to Wells Fargo bank, and that for that reason alone a life-saving commercial line of credit had been “denied”, notwithstanding that the line of credit application was made under false pretenses and would have been denied in any event if numerous other adverse financials had not been knowingly concealed by defendants. See, Count I, ¶98 to ¶99.

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8. These defamatory statements had the result of alienating plaintiff from the company officers, managers, and other employees, thus motivating them to conspire with defendants Capece and Fabian to create the “affidavits”, infra, which purported to justify the unlawful whistleblower-based discharge of plaintiff on December 4, 2013.

Specifically, shortly after the commencement of litigation in 2014, nearly a dozen “affiant” employees, along with defendant Frank Rajs, decided to execute a series of affidavits, at the direction of defendant Leah Capece, which affidavits inter alia referenced a “staring” incident as “proof” that plaintiff would “destroy” the company.

10. The affiants were likely motivated to execute these affidavits because, inter alia, they had been informed that their livelihoods were in peril - since the “controlling” widow of the late Todd Harris Applebaum would somehow exercise her powers as a minority shareholder to “destroy” the company and fire the company’s de facto president, Mr. Rajs.

11. In late 2017 defendants frivolously utilized the affidavits under false pretenses to argue in a State Court motion that plaintiff’s minority non-controlling stake in the Todd Harris Company should be sold to a third party, in order to forestall the impending doom of the company at the hands of plaintiff, despite her discharge from the company on December 4, 2013. See Count I, ¶318 to ¶334.

12. At his deposition, defendant Fabian in fact made it clear that the actual reason for

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plaintiff’s discharge in December 2013, as well as the 2017 motion to sell plaintiff's shares, was plaintiff’s whistleblower activity - particularly the state court lawsuit she filed in early 2014.

See Count I, ¶331.

13. Thus, presumably, the allegation that the plaintiff would “destroy” the company also may have encompassed a potential suit as a minority shareholder.

14. Nonetheless, as such suits are not routinely filed to “destroy”, but rather to remedy, the statement that a potential minority shareholder suit could result in destruction of the company is generally untrue - unless the company is run as a RICO enterprise in which case such a minority shareholder suit would presumably result in the exposure of rampant fraud, and the incarceration of its officers, hence the “destruction” of the company.

15. The affidavits executed by the “affiant” defendants in early 2014, supra ¶90-93, themselves contained further admissions of whistleblower animus which would render the “company destruction” hyperbole true only if in fact there is rampant fraud at the company.

16. This was depicted inter alia by the affiant’s marked and repeated objections to a “gas receipts” procedure change suggested by plaintiff, which targeted truck gasoline usage fraud.

17. If there is gasoline usage fraud within the company - then perhaps this may arguably

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result in a high attrition rate of employees accustomed to the “wild west” days of the Todd Harris Company. If there is no such fraud, the allegation that plaintiff could “destroy” the company with these suggested changes is wholly defamatory.

18. One of the affiants - defendant Garret Applebaum - similarly set forth whistleblower animus by claiming that plaintiff was “digging for dirt” while employed at the Todd Harris Company.

If there is “dirt” at the company, the allegation that she can “destroy”

it by “digging for dirt” is arguably true. If there is no “dirt”, then it is false.

19. The following six named defendants prepared the said frivolous affidavits in collusion with Ms. Capece and Mr. Fabian: Michael Lackey, Gerald Macko, Derek Schumacher, Jimmy Samayoa, Garrett Applebaum , and Youssef Abdulah Youssef.

20. In an 18-page affidavit dated May 15, 2014, and filed in State Court, defendant Frank Rajs made further defamatory statements which likely motivated her discharge on December 4, 2013, as well as the 2017 pleadings to disinherit her, and in the process also prominently disclosed further whistleblower animus.

21. Specifically, defendant Rajs in his May 15, 2014 court-filed affidavit, defamed plaintiff by claiming she was “ disruption” and “harassed” an employee by speaking to him about the business (verbatim quotes below with commentary in brackets for clarity, emphasis in bold added):

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a. Edita became a disruption almost immediately [because] she had a never-ending list of “ideas” as to how to “improve” the business..some of the ideas were not completely unreasonable...

b. She targeted my son Marc [employee at the company] for constant questioning and harassment…[by] complaining about the [company] website [which he designed]...[by stating] that she wanted an outside professional to redesign the site…[and by] questioning him continually about his duties at the company and his compensation…

c. During her “observation” period from December 2012 - June 2013 [during which time she was allowed to observe and learn] she asked if she could observe Thomas D’Ambrosio [employee who handled the company finances] …[she also] began to complain that the overtime was too high…

d. Similarly, [plaintiff] complained that [the company] did not lay off employees [during the slow season].

e. [She] questioned nearly every aspect of my management…[and she questioned] employees.

ii. Conclusion

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22. The statements offered by Mr. Fabian, the “affiants” and by Mr. Rajs to support plaintiff’s 2013 discharge - and the 2017 and 2018 pleadings to disinherit her - in fact inadvertently disclosed whistleblower animus.

23. However, her discharge in 2013 - as well as the preparation of the affidavits in 2014 and the filing of the pleadings to disinherit her in 2017 - were also motivated by defamatory statements made by defendants that plaintiff would “destroy” the company and/or that she was harassing employees by merely asking them about their job duties and or terms of compensation.

24. These otherwise benign and remedial “harassing” acts by plaintiff, to be sure, came on the heels of the June 27, 2013 “crisis” meeting, supra, in which defendants bombarded plaintiff with claims of the demise of her husband’s company - and the potential arrest of its employees and officers - because of the rampant fraud they had committed which led to the Sun Bank fraud lawsuit in 2013.

25. Ergo, any criticism of plaintiff’s acts in questioning employees and policies after a near-fatal fraud lawsuit would be, in the best case, misguided.

26. Any statements that plaintiff is “harassing” the company employees, or out to “destroy” the company by engaging in these remedial and bening acts after the near-collapse of her late husband’s company are, in the worst case, slanderous or libelous defamation which entitles plaintiff to compensatory and punitive damages.

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27. As to the statute of limitations and tolling, the tolling arguments regarding the RICO Count, to wit, duress, and the pendency of another Court action are applicable to the within claims in this Count. See Count I, ¶400-460. 28. As to the Litigation Privilege, some of the defamatory statements made were made prior to litigation (e.g. plaintiff was fired upon being informed that she was not a team player for her refusal to participate in the Wells Fargo Fraud). Moreover, the “sham” exception applies, since the litigation-based defamatory statements were baseless and were meant to harm plaintiff in themselves. See Count I, ¶461-473.

WHEREFORE plaintiff demands judgment on Count III (Defamation) against defendants in the amount of one million dollars for compensatory and punitive damages.

COUNT IV.

WHISTLEBLOWER - CEPA AND “PIERCE” RETALIATION IN VIOLATION OF PUBLIC POLICY I.

INTRODUCTION

1. Plaintiff repeats and avers the allegations in Count 1, ¶1 to ¶486, as if fully set forth herein and hereby amends this count to allege, in addition to CEPA, a wrongful discharge in violation of public policy pursuant to New Jersey, Pierce v. Ortho Pharmaceutical Corp., 84 N.J. 58, 72 (N.J. 1980).

2. In late 2012, prior to the 2013 “crisis” meeting and the Sun National Bank lawsuit, plaintiff was offered employment at her late husband’s company, the Todd Harris Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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Company.

3. Defendants eventually hired plaintiff sometime in December of 2012, and she was discharged one year later on December 4, 2013, at the time earning a salary of $1,600.00/week.

4. At the time she was hired, she was given no formal assignments or title.

5. Defendants claim that between December 2012 and June 2013, the period prior to the Sun National Bank “crisis”, plaintiff came in only sporadically - having no formal job title or assigned duties.

After the Sun National Bank “crisis” in June of 2013, plaintiff began to work daily at the company - in an obvious effort to stave off the impending doom of the company which defendants had convinced plaintiff would occur without intervention.

Defendants claimed that they allowed plaintiff to work at the company only so that she could “stay connected” to her late husband - and not because she was deemed essential.

8. Ergo, plaintiff was not particularly welcomed at the company ab initio, because they feared she would expose the rampant fraud.

9. Their early rejection of plaintiff was also motivated by ethnicity and misogyny.

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10. This was illustrated inter alia by defendant William Fabian, who in or about April of 2013 made comments to plaintiff suggesting that the Latino or Hispanic men at the company would find it difficult to work with a woman.

11. The “affiant” defendants, having been mislead as to plaintiff’s purported ability to “destroy” the company by inter alia exposing rampant fraud, in their affidavits also claimed that the plaintiff was not welcomed at the company ab initio

12. Thus, the affiants claimed inter alia to have been “surprised” to see the widow of the owner of the company on the premises - notwithstanding that the company had almost collapsed because of the Sun Bank mishap.

13. Defendant Rajs also repeatedly admitted that plaintiff had “almost no role or responsibilities” within the company, presumably because they did not want her there. 14. Defendant Capece in a series of letters and meetings in 2013 similarly instructed plaintiff that she had little to no authority within the company - suggesting that if they did find her employment, they would seek to keep her from having financial oversight, for fear that she would expose rampant fraud.

15. Plaintiff was thus not welcomed at the company ab initio because defendants feared she would expose the rampant fraud which was the sine qua non of the Todd Harris Company.

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16. As much was evident in the sworn affidavits prepared by Ms. Capece and the affiants in early 2014, supra, in which they unequivocally claimed that the late Todd Harris Applebaum wanted plaintiff kept away from the company financials.

II. AB INITIO, PLAINTIFF WAS PROHIBITED FROM ASCERTAINING COMPANY FINANCIALS - ATTEMPTS TO CONCEAL RAMPANT FRAUD FROM PLAINTIFF. 17. As part of their efforts to prevent whistleblower activity by plaintiff, defendants in 2013 undertook deliberate steps to conceal the company financials from plaintiff, as was evident in an email dated July 24, 2013 from defendant Laurence W Gold to defendants Thomas D’Ambrosio and Leah Capece, in which Mr. Gold unequivocally stated that the company’s financials were not to be disclosed to plaintiff (graphic below, July 24, 2013 email):

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18. Further, at a recorded meeting in August of 2013, defendant William P. Fabian expressly warned plaintiff not to print documents from her work computer.

19. In addition, as discussed supra, Count I, defendant Leah Capece has significantly curtailed financial discovery by requiring that plaintiff execute a frivolous “global”

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non-disclosure agreement which would prevent plaintiff from having access to nearly all company-related documents, financial or otherwise.

20. Indeed, in one instance in late 2017, Ms. Leah Capece used the non-disclosure agreement to file a frivolous motion to quash a third party subpoena directed to Wells Fargo bank.

21. The motion to quash as of the date of the filing of this complaint has not been decided, thus effectively preventing access to the Wells Fargo file related to a quarter-million-dollar line of credit which Ms. Capece herself admitted was the subject of a bank fraud conspiracy, in which she was an active participant.

III. DISCHARGE OF PLAINTIFF ON DECEMBER 4, 2013 - PLAINTIFF WAS ESCORTED BY POLICE FROM HER LATE HUSBAND’S COMPANY - Defendant Ms. Leah Capece, William P. Fabian, and Laurence Gold were on the company premises on that date and had plaintiff escorted from the premises in retaliation for her whistleblower complaints 22. Prior to plaintiff’s unlawful firing on December 4, 2013 the defendants, keenly aware of plaintiff’s whistleblower activities, began to take retaliatory actions against plaintiff.

23. Thus, in a pre-litigation letter dated August 20, 2013, from plaintiff’s prior counsel to defendant Leah Capece, plaintiff’s prior counsel indicated that :

As you may not be aware due to the fact that you were on vacation, the situation at THC has deteriorated. In addition, despite your assurances, officers and representatives have continued to take hostile and retaliatory actions against Edita. She has made numerous proactive attempts to address areas of waste and mismanagement but her efforts have been Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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thwarted or rejected without explanation…. Leah, the adverse actions by THC’s and the Estate’s officers and representatives must stop immediately…

24. Plaintiff’s whistleblower activities included: (i) complaints regarding personal use of company vehicles (ii) complaints regarding GPS-tracking for company vehicles to prevent unauthorized use, (iii) complaints regarding employee use of company credit cards (iv) complaints regarding “cash receipts control” and “inventory control” (v) complaints regarding a security system for the company (vi) complaints regarding a collection system for accounts receivable (vii) complaints regarding misuse of company cell phones and (viii) complaints regarding misuse of company business account for personal purchases.

25. These fraud-related complaints by plaintiff came on the heels of the Sun Bank lawsuit, infra, as well as the “crisis” meeting at which defendants alluded to the impending doom of the company in a melodramatic manner. Count I, Predicate Act II.

26. As such, the complaints not only targeted potential fraud at the company - they targeted fraud in a company known to conduct business fraudulently, as depicted inter alia by the meritorious Sun National Bank lawsuit.

27. Notwithstanding, in a show of force defendants commanded the presence of Ms. Leah Capece, Laurence W. Gold, Frank Rajs, and William P. Fabian, to effectuate an unlawful firing of plaintiff on December 4, 2013.

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28. The firing was preceded by one last whistleblower-based act by plaintiff, to wit, an email she sent defendant Frank Rajs at 8:56 AM on the morning of December 4, 2013, regarding the use of company trucks for personal purposes - an activity she had complained of numerous times previously.

29. At 11am on that same day Mr. Frank Rajs approached plaintiff accompanied by defendant Leah Capece, Esq., with Mr. Fabian and Mr. Gold sitting in a room separated by a glass partition.

30. Defendant Frank Rajs then instructed plaintiff to leave the premises - her husband’s company - immediately, as she had been fired.

31. At his deposition, Mr. William P. Fabian acknowledged that plaintiff had done nothing particularly egregious at this point - she had not committed any felonies or misdemeanors, she had not assaulted anyone, and she had not harrassed anyone.

32. Notwithstanding, defendants called the Edison, New Jersey, police department and had plaintiff escorted from her late husband’s company -leaving the officers themselves aghast.

33. In the midst of overwhelming emotional trauma, plaintiff placed a call to her attorney prior to being escorted from the premises, and she asked defendants for more time to receive a call-back.

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34. Nonetheless, defendants called the Edison, New Jersey, Police Department.

35. Plaintiff’s own words shed some further insight on this nightmarish and unlawful firing of a widow, and offer a clear overview of the whistleblower-based animus for same, which whistleblower animus also significantly motivated the frivolous pleadings to disinherit plaintiff filed in late 2017 and late 2018, infra, based on the defamatory hyperbole that plaintiff would “destroy” the company:

My Employment Termination Wednesday, December 4, 2013 at around 11:00 a.m. Frank came back to work on Monday December 2, 2013 at around 8:00 a.m. after been out for about two weeks due to shoulder surgery. That morning he told me that he needed to speak to me later on. I waited the whole day on Monday and Tuesday for Frank to talk to me like he said. I also thought that this would have been a good opportunity to inform him of some issues that happened in the THC while he was out. I followed the chain of command by bringing those issues up to the attention of Jaime Samayoa (Jimmy) the vice-president. Jimmy told me to wait until Frank comes back so he can take care of those issues and that was what I did. This opportunity to talk to Frank in person never came. So on Wednesday December 4, 2013, at 8:56 a.m. I sent Frank an email informing him of some of those issues. At around 11: 00 a.m. Frank terminated me from the THC. Two important issues: (I have a copy of this email) ● The incident I had with Frenc the employee who threatened me because I asked him for the fuel receipts. Frenc was one of the few employees who refused to hand in receipts. ● The THC electrician, Charle Zalenti (JR), have been using the THC vehicle as his personal vehicle and he was told to stop doing so. This is what happened: On Friday November 29, 2013, the day after Thanksgiving, most of the employees were off including JR. When I left the THC around 6:00 p.m. that Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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Friday, I accounted for every THC vehicle and they all were there. The next day that morning, Saturday the 30th, vehicle 55 which is driven by JR, was not there. JR must have come back to the company and took it home. All drivers of the THC are allowed to keep the keys for the THC vehicles in their possession. There is not a system in place to account for the keys of the THC vehicles. (I also made Frank aware of that and his reply was that this was the way Todd did it) Almost always I worked on Saturdays and I took my daughter Melanie with me. During the summer of 2013, Melanie went to the THC on Mondays and Fridays to help her grandma Eileen Applebaum to stuff and file paid invoices. Melanie was doing a good job and Eileen even suggested to Frank to give her a part time job. Frank didn’t even consider it. He just said no. So, when Melanie started school in September of 2013, she came to work with me on Saturdays to continue filling paid invoices to help her grandma. That Monday at around 8:00 a.m. when Frank came back to work, JR immediately went to him and informed him that he has taken the THC vehicle home over the weekend. Frank told him that it was okay to take it home if he needed it. JR replied out loud “You are the boss, thank you”.

Events of my Employment Termination To my surprise, that Wednesday (December 4, 2013, at around 11:00 a.m.), after I sent that memo to Frank at 8:56 a.m., he came to my office and told me that he wanted to talk to me. He brought Jimmy with him and we went to the conference room. That is when I saw Leah Capece (their lawyer) sitting in Frank’s office by the door next to the conference room. Right away I felt threatened and I told Frank that I needed to have someone present with me. Frank sent me to get Garrett, but he couldn’t be found anywhere. So, I went back to the conference room and Frank and Jimmy agreed that I record the meeting instead. Frank, without hesitation, proceeded to tell me that I was been terminated from the THC accusing me of been a disruption to the company. Frank had with him a termination letter and he asked me to sign it emphasizing that he has the right to terminate me. I told Frank that he was being unfair because he had a lawyer present and he did not give me a chance to have my lawyer present as well. (I have the recording of this part) I told Frank that I was not going to sign the letter because he knew I was already legally represented and they should have sent that letter to my lawyer. I also reminded him that there was an agreement between our lawyers that no retaliation was going to be taken against me until the requested documents were provided from them and after the lawyers meet again. Frank told me that if I don’t leave the premises of the building, he will call the police. I informed him that I was going to contact my lawyer so he can instruct me on what to do. (I immediately called my lawyer and left him a message pointing out that it was an extreme emergency.)

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Frank then went and found Garrett and involved Benjamin and asked them to convince me to leave the building. Benjamin and Garrett took me outside and we sat in my car. They told me that I should leave the building because we have to separate business from family. I told them that I need my job because I don’t have any other income to pay my mortgage and my bills. I also told them that if Frank terminates me, by law, they don’t have to and they won’t pay me my salary. Garrett said “Just go home now and let’s wait until Frank cools off.” Benjamin said “I am sure that Frank will take care of you and, again, we have to separate family from business” Then I told them the same thing I told Frank, that I was going to wait to hear from my lawyer to advise me on what to do. While I waited to get an answer from my lawyer, I stayed in my office and continued to do my routine work. Frank ignored the fact that I was waiting for my lawyer to call me back and he went ahead and called the Edison police on me anyway. Only Garrett and Frank came in my office (which was Todd’s office and I was sharing it with Benjamin) with the police. I told the police officers that I have left a message for my lawyer and that I was waiting for him to call me back and advise me on what to do. I asked the officers (O fficers Makras and Ulozas) if they can give me an extra 5 minutes to wait for the call. The police officers asked Frank (using body language) if it was okay with him and Frank nodded yes with his head. I asked officer Makras if someone can call my son Benjamin. Officer Makras said: “we don’t have time to wait for your son to get here. You are going to have to leave the premises of the building in a few minutes” I told the officers that I am the widow of the owner of the company who passed away 13 months ago today and that my son works on that desk next to mine. (The officer’s jaw dropped.) T hen he said to me that unless I have something to show them that I have the right to be there, they had no choice but to take me out. He also said that the guy in that room (pointing to Fabian who was sitting in the see through glass conference room) show them documents proving that he was the executor and the one in charge of the company. Garrett then went and got Benjamin. When Benjamin came to my desk and I told him, whispering, “I won’t be able to pay for my bills and I have Melanie…” He answered “okay mom” lifting his right hand up and bringing it down and he left the office. He did not even let me finished my sentence. I kept insisting calling in my lawyer until finally I reached him and he told me to leave the building and to go to his office. Before I left, I handed to Frank all the work I had completed and I gave him a pile of pending work that needed to be completed. (It had to do with matching and filling the drivers’ form of lading trip report to their job tickets for the month of December. All the previous 11 months for the year were already done)

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I took only my purse with me and I locked my filing cabinets and left the building through the front door. I left all my personal staff behind) Bill Fabian, Larry Gold, and Leah Capece were sitting in the see through glass conference room. Fabian kept his eyes steadily on me until I went out of the building. The police officers followed me outside and they started to talk to me. They said that they were very sorry for what happened. Again, they said that Fabian show them document showing that he is the executor and the person in charge of the business and that he told them that I don’t have the right to be there. They asked me if I have any document that said that I can be there as the widow of the owner. I said no. They said “I am sorry again that this has to happen to you.” They also said that they were in shocked that my son is doing this to me. They also advise me to get a good lawyer and have the court sent me back to the company with a letter of protection. So, in that case, if they were to call the police on me again they don’t have to come to take me out of the building again. The officers wrote their names on a sticky note for me and told me to contact them if I need anything. I told the officers that I already had a lawyer and that it was agreed that they were not to retaliate, or do anything against me without informing my lawyers first. The officers said good luck to me and I walked to my car and went to my lawyer’s office.

36. As stated supra, Count I, and as repeated below, the defendants then in late 2017 attempted to completely disinherit plaintiff by filing a frivolous motion purporting to sell, at discount, her minority-share ownership in the company, purportedly because plaintiff could somehow “destroy” it by, inter alia, “staring” at employees - notwithstanding that she had been fired four years prior to the motion and could no longer “stare”.

IV. DEFENDANT RAJS’S ARTICULATED REASONS FOR THE FIRING - THAT DEFENDANT COMPLAINED OF SPECIFIC INSTANCES OF “MISMANAGEMENT”, ARE IN VIOLATION OF CEPA 37. In an affidavit dated May 15, 2014, defendant Frank Rajs all but admitted the whistleblower-based animus for the December 4, 2013 firing of plaintiff. Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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38. Thus, Mr. Rajs indicated in the affidavit that defendant Thomas D’Ambrosio was warned by the late Todd Harris Applebaum himself never to “discuss the business” with plaintiff.

39. In addition, defendant Rajs admitted that plaintiff repeatedly complained about excessive employee overtime at the company, as well as the lack of employee layoffs during the company’s slow season.

40. Ultimately, Mr. Frank Rajs claimed in the affidavit, plaintiff “questioned nearly every aspect of my…. [m]anagement of THC….This included our accounts receivable, our policies concerning GPS units in the work vehicles, and our inventory control..”

41. Mr. Rajs in that affidavit then conveniently itemized further protected whistleblower complaints for which he admittedly fired plaintiff: (i) complaints regarding personal use of company vehicles (ii) complaints regarding GPS-tracking for company vehicles to prevent unauthorized use, (iii) complaints regarding employee use of company credit cards (iv) complaints regarding “cash receipts control” and “inventory control” defendant admitted there was no such inventory control (v) complaints regarding a security system for the company (vi) complaints regarding a collection system for accounts receivable (vii) complaints regarding misuse of company cell phones and (viii) complaints regarding misuse of company business account for personal purchases.

42. The foregoing constitutes an explicit admission - in the form of a sworn statement - by

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defendant Frank Rajs that plaintiff was fired in violation of CEPA.

V. PLAINTIFF’S STATED REFUSAL TO PROVIDE A PERSONAL GUARANTEE TO WELLS FARGO, UNDER FALSE PRETENSES, IS AMONG THE REASONS FOR THE FIRING, AND FOR THE PLEADINGS TO DISINHERIT, INFRA, IN VIOLATION OF CEPA 43. The whistleblower-based firing of plaintiff was also based on plaintiff’s failure to participate in the Wells Fargo bank fraud of 2013, supra at Count I, Predicate Act III.

44. Specifically, plaintiff’s failure to execute a personal guarantee she had reason to believe would be fraudulently used to procure a quarter-million dollar line of credit from Wells Fargo. See Count I, Predicate Act III.

45. In fact, in an affidavit filed in State Court, as part of a frivolous pleading to disinherit plaintiff based on her purported ability to “destroy” her husband’s company as a minority shareholder, defendant William P. Fabian prominently alluded to plaintiff’s failure to provide the personal guarantee as “proof” that she would “destroy” the company.

46. In early 2018, however, the bank executive who allegedly “denied” the quarter-million-dollar line of credit - purportedly because of plaintiff’s failure to provide the personal guarantee- revealed in no uncertain terms that the line of credit had been procured based on fraud, and would have been denied because for that reason alone.

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47. Ergo, plaintiff’s failure to participate in the Wells Fargo fraud cannot lawfully form the basis for her December 4, 2013 discharge, or the 2017 pleadgins to disinherit her. See N.J.S.A. §34:19-1 to -9 (“CEPA”). VI. AFTER PLAINTIFF FILED THE STATE COURT LAWSUIT IN EARLY 2014, IN AN ILL FATED ATTEMPT AT CREATING THE PRETEXT FOR THE UNLAWFUL FIRING, DEFENDANT AFFIANTS IN FACT ADMITTED WHISTLEBLOWER ANIMUS - E.G., THAT PLAINTIFF WAS “DIGGING FOR DIRT” AND THE GAS RECEIPTS POLICY CHANGE WHICH THEY REPEATEDLY CRITICIZED. 48. The defendant “affiants” in this case are Michael Lackey, Gerald Macko, Derek Schumacher, Jimmy Samayoa, Garrett Applebaum, and Youssef Abdulah Youssef.

49. In May of 2014, shortly after plaintiff filed her State Court fraud lawsuit, the affiant defendants colluded with defendants Leah Capece, William Fabian, and Frank Rajs to “protect” themselves from plaintiff’s claims related to her unlawful firing nearly six months prior to the lawsuit.

50. The collusion entailed preparation of frivolous affidavits, with the direct assistance of defendant Leah Capece, in which they alluded to various employment-related “incidents” in support of the proposition that plaintiff would “destroy” the Todd Harris Company if permitted to work there.

51. Among the company-destroying incidents was one in which plaintiff “stared” at one employee and then got up and left.

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52. In another affidavit defendants claimed that plaintiff - whom they admitted was given no formal assignments or job title - would often stand next to the time clock to meet and greet the employees of her late husband’s company.

53. Defendants, particularly defendant William P. Fabian, literally claimed that these “incidents” had the capacity to “destroy” the company.

54. It bears noting that one of the affiants, who was not named a party herein, was plaintiff’s mother-in-law Eileen Applebaum, who at her deposition testified that she did not remember signing the affidavit, which defendant Leah Capece admittedly prepared in or about May of 2014.

55. The affiants who did remember signing their affidavits inadvertently disclosed whistleblower animus in support of the non-sequitur that plaintiff would “destroy” the company if permitted to work there.

56. Thus, the affiants were particularly appalled at plaintiff’s gas receipts policy change which curtailed fraud by preventing unauthorized excessive gasoline usage.

57. In another affidavit, defendant Garret Applebaum succinctly stated that plaintiff was “digging for dirt” while employed at the Todd Harris Company.

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58. These, and other statements made in the affidavits, depict a clear whistleblower animus for the firing of plaintiff on December 4, 2013, and for the subsequent frivolous motions to disinherit her, filed circa September 2017 in State Court.

VII PLEADINGS TO DISINHERIT PLAINTIFF IN AUGUST OF 2017 AND OCTOBER OF 2018 UNDER FALSE PRETENSES AND PURSUANT TO A FRIVOLOUS NON-SEQUITUR; CONTINUING VIOLATION THEORY AND DEFENDANT’S SPECIFIC ADMISSIONS OF WHISTLEBLOWER ANIMUS FOR THE MOTION 59. Defendants fired plaintiff on December 4, 2013 because of her whistleblower activity, notwithstanding that her bona-fide fraud complaints were made on the heels of a meritorious fraud lawsuit by Sun National Bank.

60. A few months later, circa April of 2014, plaintiff exercised her rights and filed a limited “fraud” lawsuit in the State probate Court, albeit based primarily on “breach of fiduciary” duty.

61. Upset that plaintiff was prosecuting a state court “fraud” lawsuit - in which she disclosed the rampant fraud at the Todd Harris Company - defendants sought to punish plaintiff further in retaliation for her lawsuit, and in violation of CEPA.

62. In furtherance thereof, defendants disingenuously used the affidavits, which had been prepared to justify plaintiff’s discharge from her husband’s company, in order to set forth a remarkable non-sequitur - that plaintiff somehow had the capacity to “destroy” the Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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company as a minority shareholder, notwithstanding that she had been fired and specifically prohibited from setting foot in the company four years prior on December 4, 2013.

63. Specifically, in late 2017 defendants filed a frivolous pleading, under false pretenses, seeking to sell plaintiff’s 40% stake in the company.

64. Defendants submitted in that pleading the work-related affidavits, supra, in support of their frivolous “company destruction” non-sequitur.

65. The affidavits, to be sure, were related to plaintiff’s work as a company employee and had no substantive bearing whatsoever on her role as a minority shareholder.

66.

A fortiori, they could not justify the outrageous proposition that plaintiff could “destroy” the company as a minority shareholder.

67. Assuming arguendo that the affidavits were relevant to that inquiry, as indicated supra the affidavits referenced protected whistleblower activity, and as such would in fact be substantively insufficient to justify the disinheritance of plaintiff by way of the firesale of her minority shares.

68. At his deposition on September 8, 2017, when asked why he had filed the said pleading to disinherit plaintiff, the first reason defendant William Fabian referenced was the filing

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of the lawsuit by plaintiff in early 2014.

69. Thus Mr. Fabian in that deposition explicitly set forth the whistleblower animus for the pleadings to disinherit plaintiff (deposition verbatim quote, “A” for answer, “Q” for question):

A. The fact that she …. attacked all of the managers of the company via the lawsuit, was part of my consideration. Q. I'm sorry, sir, she attacked. Can you, please, explain to me how she attacked people with a lawsuit? A. She claimed that they were, they had committed fraud and wrongdoing's and things of that nature. Q. You're saying she should not have done that? A. Well, I certainly don't think so, that's right.

70. In addition, in a letter filed in State Court in support of the frivolous motion, defendant Fabian through his counsel argued that it “doesn’t take much imagination” to predict that if plaintiff were permitted to remain as a minority shareholder, she would exercise her rights as a minority shareholder to file lawsuits against the company - thereby “destroying” same.

71. Thus, the clear aim of the motion to sell plaintiff’s minority stake in her late husband’s company was to preempt prospective whistleblower-activity, the filing of minority shareholder lawsuits, in clear violation of CEPA.

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72. Ergo, the pleadings to disinherit plaintiff - filed in late 2017 and in late 2018 constitutes a “continuing” CEPA violation, thus tolling the statute of limitations and permitting suit inter alia for plaintiff’s unlawful 2013 retaliatory discharge.

VIII. DEFENDANT FABIAN , AS EXECUTOR OF THE ESTATE OF THE LATE TODD HARRIS APPLEBAUM, AND AS INTERIM OWNER OF THE SHARES OF THE TODD HARRIS COMPANY, IS/WAS AN “EMPLOYER” UNDER CEPA 73. As stated supra, defendant William P. Fabian as executor of the estate of the late Todd Harris Applebaum is the interim owner of 100% of the Todd Harris Company shares.

74. In addition, he claims to be an active “consultant” on the payroll of the Todd Harris Company and at his deposition he unequivocally stated that defendant Frank Rajs, who at the time of the events in this complaint was the president of the Todd Harris Company, “leans” on him “heavily” as regards the management of the company.

75. As such, William P. Fabian is an “employer” for purposes of CEPA

IX:

NOVEMBER 12, 2018 CEPA AMENDMENTS - NOERR-PENNINGTON, LITIGATION PRIVILEGE ALLEGATIONS 76. The CEPA claims against defendants, as well as the Pierce claims she now alleges, constitute a readily ascertainable continuing pattern which began with plaintiff’s unlawful discharge circa December of 2013.

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77. This retaliatory pattern is inter alia comprised of post-discharge abuse-of-governmentalprocess actions which are objectively baseless and which are meant to harm plaintiff in themselves by causing emotional distress, and by also causing her to incur more costs in attorney’s fees, in a clear effort to curtail or altogether prevent further litigation from her, and/or to compel her to drop her lawsuits.

78. Specifically, but without limitation, the following three acts are among the most significant for the post-discharge continuing violation theory: (i) A January 8, 2015 opposition to plaintiff’s motion to compel Mr. Fabian to transfer her 40% stake to her - in that opposition Mr. Fabian for the first time formally insisted that the shares would be sold to prevent the “destruction” of the company at the hands of a minority-shareholder who had already been fired (ii) an August 2017 verified complaint seeking to effect said sale for the said frivolous reasons and (iii) An October 2018 verified complaint seeking to effect the said sale for the said frivolous reason - with the added argument that the Federal lawsuit is the “best evidence” that plaintiff will “destroy” the company.

79. As stated supra, plaintiff (and her special needs daughter) has also not received a distribution for her late husband’s estate in six years of estate administration - and this deliberate act of failing to provide plaintiff funds from her husband’s estate is also meant to prevent litigation, by cutting off funds plaintiff may use to litigate against defendants.

80. That defendant Fabian is disinterested in the outcome of his frivolous Verified

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Complaint(s) to disinherit plaintiff can be clearly gleaned from the following non-exhaustive facts (which shall be set forth in separate paragraphs):

81. (i) Prior to litigation, plaintiff was in fact routinely promised she would get a 40% stake in her husband’s company at the closing of the estate.

82. (ii) The drafter of decedent’s last will and testament in fact stated at his deposition that the clear intent of the decedent was to give plaintiff a non-controlling 40% stake in the company through the residuary clause of his will.

83. (iii) Defendant William Fabian at his deposition stated that THC personnel - whom it is alleged plaintiff cannot get along with as pretext for the pleadings to disinherit her - in fact would welcome plaintiff at the company.

84. (iv) At that same deposition, defendant Fabian emphasized that it was the plaintiff’s litigation which worried them - thus compelling them to disinherit her completely by selling her non-controlling share in her husband’s company (in order to prevent minority oppression suits).

85. (v) Defendant Fabian’s counsel Thomas Howard, Esq., who is not named as a party in order to prevent interference in the probate action (FRCP 19(c)), in fact in his letters to the Court in support of the pleadings to disinherit plaintiff emphasized that “it doesn’t take much imagination” to surmise that plaintiff would file minority oppression lawsuits

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if she were permitted to hold on to the 40% stake in her husband’s company (notwithstanding that it was her husband’s clear intent that she get same, and she had routinely been promised same pre-litigation and post-litigation during mediation, and notwithstanding that it was unlawful to prospectively curb minority oppression suits which have not been filed. )

86. (vi) As late as October of 2018, Mr. Fabian’s attorney (Mr. Thomas Howard, not a named party per FRCP 19(c)), in a frivolous verified complaint signed by both himself as well as Mr. Fabian emphasized that plaintiff’s Federal RICO lawsuit constituted the “best evidence” to sell plaintiff’s minority stake in the company, notwithstanding that defendant themselves (Mr. Fabian and Ms. Capece) had repeatedly promised her pre-litigation that she would get the shares, and notwithstanding that it was her husband’s explicit intent that she get same (albeit through the residuary clause of his will).

87. Herein a graphic of the October 18, 2018 verified complaint clause, signed by both Mr. Fabian as well as his counsel, which purports to unlawfully disinherit plaintiff because of the within lawsuit. In this verified complaint paragraph, Mr. Fabian and his counsel Mr. Howard both claim that the “best evidence” which supports the conclusion that plaintiff is a threat to the company is her Federal lawsuit:

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88. (viii) At Mr. Fabian’s September 2017 deposition, his lawyer Mr. Howard stated unequivocally in a colloquy that the filing of the verified complaint in August of 2017 seeking leave to sell plaintiff’s 40% shares did not constitute an “attempt” to sell her shares (notwithstanding that the complaint named a purchaser and a price), leaving no doubt that the filing of the verified complaint was meant to achieve another purpose besides the actual sale of the shares. FRPC 9(c).

89. As this statement by counsel took place in the context of Mr. Fabian’s deposition statements that THC personnel did not fear plaintiff, and in light of Mr. Fabian’s statements that plaintiff’s lawsuits were particularly problematic, it is plausible that the sole purpose of this pleading to disinherit plaintiff was malicious, FRCP 9(c), to wit, to warn plaintiff that if she continued with the lawsuit (which she did, in fact she filed a second one), the actual attempt to sell the shares would take place.

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90. The purpose of the August 2017 pleading (and by extension the October 2018 pleading and the January 2015 motion) was thus malicious - to stop plaintiff’s lawsuit by inflicting damage on plaintiff, in the form of emotional distress and attorneys fees paid to her counsel. FRCP 9(c).

91. (ix) I n a certification filed in response to the August 2017 frivolous pleadings seeking to disinherit plaintiff, plaintiff unequivocally stated that she would be a team player, and that she would not file frivolous complaints. She also certified under oath that she was aware that a 40% interest in the company, gave her no rights of management of the company, and that she would not interfere in the its operations.

92. As to the mediation privilege, it should be noted that on October 18, 2018, Mr. Fabian and his counsel (Mr. Howard) breached the said mediation privilege - by claiming in a verified complaint, paragraph 17, that plaintiff did not act in “good faith” during mediation. Having breached/waived the privilege, additional admissible facts will be discussed regarding said mediation.

93. Enclosed herein paragraph 17 of defendant Fabian’s Verified Complaint breaching or waiving the privilege:

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94. In fact - although the defendants did not offer to personally compensate plaintiff for her losses - during mediation plaintiff was offered the position of director at her late husband’s company (THC), as well the position of trustee in a trust created by her late husband which controls 60% of the shares - and she was also offered her 40% of the company (which they are now ironically seeking to sell for fear she will “destroy” the company).

95. If in fact they feared that plaintiff would “destroy” the company, the offer of nearly total control of same would have never been made.

96. As such, the January 2015 motion opposition, as well as the August 2017 and October 2018 pleadings to disinherit plaintiff (referred to as a “motion” in other counts in this complaint) a re a sham - the sole design of these inhumane pleadings is unlawful, to punish plaintiff widow for her whistleblower activities and/or to inflict emotional and economic damage on plaintiff (in the form of additional attorneys fees, which are excessive), in an effort to compel her to drop her lawsuit(s).

The pleadings are a

litigation tactic, and nothing more.

97. This frivolous litigation tactic is in addition to, and complements, their tactic in refusing to pay any monies to the plaintiff from her own late husband’s estate - in a clear effort to avoid financing plaintiff’s litigation to “compel” her to drop the lawsuits.

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98. The foregoing is a plausible interpretation of facts which gives rise to the “sham” exception to Noerr-Pennington immunity of Mr. Fabian, as well as his counsel, who has not been named a party in order to avoid disrupting the Estate Litigation. FRCP 19(c).

99. Moreover, malice and intent of the defendants (particularly of Mr. Fabian and of the “unindicted co-conspirator” - his current counsel) may be alleged generally per the Rules of Court. FRCP (9)(c) “In alleging fraud or mistake, a party must state with particularity the circumstances constituting fraud or mistake. Malice, intent, knowledge, and other conditions of a person's mind may be alleged generally.” X: NOVEMBER 12, 2018 CEPA AMENDMENTS - STATUTE OF LIMITATIONS, CONTINUING VIOLATION, “Pierce” VIOLATION OF PUBLIC POLICY, APPLICABILITY OF PIERCE’S SIX YEAR STATUTE OF LIMITATIONS FOR CONTRACT CLAIMS

100.

Regarding CEPA’s and the “Pierce’s” claim statute of limitations, and the

continuing violation theory, the following facts plausibly s et forth that at least one of the “continuing violation” acts occurred within the filing period (one year starting in December of 2013 for CEPA, and two years or six years for Pierce), thereby tolling the statute under both claims (CEPA AND Pierce):

101.

(i) Plaintiff prior to December of 2013, for most of 2013, was repeatedly assured she

would get her 40% stake in the company, which was in accord with her husband’s wishes per the drafter of his last will and testament (who was also a close friend of decedent).

102.

(ii) Plaintiff was not welcomed at the company ab initio - as much was clear in a

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statement made by the executor in early 2013 that the Latino male employees at the company would not welcome her. This statement (plausibly) was a thinly veiled attempt at preventing plaintiff from setting foot in the company - as they were clearly aware of the rampant fraud and clearly (i.e. plausibly) feared that she would reveal same.

103.

(iii) While plaintiff was working at the company, the company accountant and

defendant Gold sent an email making it clear that “raw” financial data of the company would be hidden from plaintiff.

104.

(iv) The company employees and “affiants” herein, in affidavits executed in May of

2014 (six months after plaintiff was discharged), claimed that plaintiff in 2013 while employed was “digging for dirt” and that her policies meant to curb fraud, i.e. changes in the “gas receipts” policy, was among the reasons she was fired in December of 2013.

105.

(v) A few months prior to her firing, in August of 2013, plaintiff and her prior

attorney met with defendant Fabian and Capece, in a meeting recorded by consent, and asked Mr. Fabian numerous questions about Mr. Fabian’s payroll fraud - in which he sought to pay himself a $602,200.00 debt, for which he has no credible evidence, by placing himself on the payroll of the Todd Harris Company, thereby hiding the debt from the world.

106.

(vi) Mr. Fabian explicitly admitted the fraud - although he did not admit that it’s

purpose was to hide the $602,200.00 debt from the world - rather, he claimed it was for administrative purposes.

107.

(vii) However, in June of 2013 he had previously uttered that at the “end of the day”

he “will not disclose anything to anybody” - thus plausibly lending credibility to the assertion that by paying himself on the payroll, he would hide the debt from the world.

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108.

(viii) In fact, in interrogatory answers Mr. Fabian admitted that he did not begin

these fraudulent payroll payments in 2011 because the company was under IRS audit.

109.

(ix) At the August 2013 meeting, as stated supra defendant admitted the fraud to

plaintiff’s prior attorney - but attempted to mislead plaintiff by claiming it was for “administrative” purposes.

110.

(x) Three months after this (August 2013) significant whistleblower-based interview

of the executor by plaintiff’s prior attorney - in December of 2013 - plaintiff was discharged for alleged insubordination.

111.

(xi) Discharge affidavits where then executed after plaintiff filed suit in April of

2014.

112.

(xii)Specifically, one month after filing suit in April of 2014, the “affiant” defendants

sought to justify the firing by setting forth in affidavits - prepared by defendant Capece that plaintiff had personality issues (notwithstanding that defendant Gold had previously spoken highly of her).

113.

(xiii) Throughout the litigation, and prior to same (and since the Estate was opened),

defendants refused to provide a monetary distribution to plaintiff, and failed to create a testamentary trust of which she was a beneficiary - this action was retaliatory because of plaintiff’s whistleblower activities and was in addition to the discharge of plaintiff in December of 2014.

114.

(xiv) As the litigation progressed, it also became imminently clear that the true

purpose of the affidavits was not defensive - but rather offensive, in order to threaten plaintiff with the sale of her 40% share in her husband’s company, should she try Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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115.

(xv) Plaintiff thus first became aware of Mr. Fabian’s purported intent to sell her

shares by way of a January 8, 2015 opposition to plaintiff’s motion to transfer her 40% shares to her.

116.

(xvi) In that opposition and in his certification, Mr. Fabian relied on the frivolous

“affiant” affidavits (which had been prepared in May of 2014), to argue that plaintiff’s acts while an employee of the company, which including a “staring” incident and plaintiff’s policy changes to curb fraud, would result in the “destruction” of the company - notwithstanding that plaintiff had already been fired from the company (allegedly for those reasons), and notwithstanding that decedent had taken into account the possibility of plaintiff’s “controlling” the company by bequeathing to her a 40% minority interest (per the testimony of decedent’s close friend Cavise, who also drafted the will).

117.

In sum - the purported reasons for the offer to sell her shares as set forth above

were non-sequiturs and were unlawful. Plaintiff had already been fired (allegedly because of the reasons set forth in the affidavits, which include whistleblower-based reasons), and her late husband had already given her a 40% stake in the company to prevent her “control”. She could not therefore “control” the company. A fortiori, she could not “destroy” same.

118.

Thus, plausibly, the proposal to sell her minority-share in January of 2015 as

submitted in opposition to plaintiff’s motion (and then formally by way of verified complaints in August of 2017 and October of 2018) was retaliatory - meant to send plaintiff a warning, and to compel her to drop her lawsuit.

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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119.

This “offer” to sell her shares and effectively disinheriting her was thus nothing but a

litigation tactic with the purpose not to genuinely sell plaintiff’s shares (as plaintiff did not pose a threat and her rights to file a minority shareholder suit could not lawfully be curtailed prospectively) , but rather as a tool to compel plaintiff to drop her lawsuit under duress.

120.

The foregoing post-discharge acts toll the one-year CEPA statute of limitations under

the continuing violation doctrine because they are intentional, pervasive, and regular and consist of more than the occurrence of isolated or sporadic acts.

121.

In addition, at least one act of harassment or discrimination occurred within the filing

period for the CEPA and Pierce claim(s). To wit, the first formal “offer” to sell her shares was on January 8, 2015, which is within the two year statute of limitations for the December 2013 discharge and the two or six year Pierce c laim statute of limitations.

122.

The frivolous affidavits purportedly justifying plaintiff’s discharge, which alleged

“staring” incidents as a basis for her discharge and were used or referenced as a basis to sell her shares, were executed in May of 2014, and therefore toll the one year CEPA statute of limitations which would have expired in December of 2014 based on the December 2013 discharge.

123.

As to the Pierce claim, the foregoing retaliatory acts are violative of public policy in

that, inter alia, defendant’s actions seek to prevent plaintiff from utilizing the Courts to seek redress as punishment for her whistleblower activity. In addition, the discharge of plaintiff, as well as the retaliatory threats to disinherit her during litigation, violate a clear public policy of permitting whistleblower activity, particularly in a Court of law.

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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124.

It is further respectfully submitted that Pierce’s six year statute of limitations for

breach of contract claims applies in this case and/or that the doctrines of pendendency of action, duress, and/or fraudulent concealment, as set forth at Count I (RICO), toll the statute of limitations.

WHEREFORE plaintiff demands judgment on this Count IV (CEPA and “Pierce” Claim) against defendants for: A. COMPENSATORY DAMAGES: THE SUM OF SIX MILLION DOLLARS AS FOLLOWS : a. Attorney’s Fees paid to defense counsel in State Court - Over One Million Dollars b. Plaintiff’s Attorney’s Fees relative to State Litigation - Over One Million Dollars c. Back pay from December 2013 to present relative to plaintiff’s employment at the Todd Harris Company - $400,000.00. d. Total: CEPA Damages of above amounts, to wit, Six Million Dollars. B. Punitive/Emotional Distress Damages in the amount of twenty million dollars C. Plaintiff’s attorney’s fees for the present action D. Reinstatement of plaintiff to her former employment at the Todd Harris Company. E. Such other legal and equitable relief as the Court deems proper.

COUNT V.

401K Common Law Negligence / Conversion - Not Preempted by ERISA Voya Financial Services, Cecilia Keh, Intac Inc., Ascensus LLC

1. Plaintiff repeats and avers the allegations in Count I, ¶229 to ¶236, as if fully set forth

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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herein (“RICO 401K fraud Allegations”).

2. Defendants Intac Actuarial Services (acquired by Ascensus LLC July 2018) and Voya Financial (formerly ING), were both in receipt of the death certificate of decedent, which listed plaintiff as his spouse.

3. As such defendants Intac Actuarial Services (acquired by Ascensus LLC July 2018) and Voya Financial (formerly ING), should have secured a waiver from the plaintiff and/or the “named fiduciary”, Ceciliah Keh, prior to disbursing the 401K funds to the Estate.

4. Ceciliah Keh, who was in fact aware that the 401K funds were the property of plaintiff, is further liable for conversion.

5. As to the statute of limitations, plaintiff hereby repeats and avers Count I, ¶400-460 as if fully set forth herein.

It is respectfully submitted that the statute of limitations was tolled for duress, fraudulent concealment, and pendency of a Court action per said Count I, ¶400-460.

WHEREFORE plaintiff demands judgment on this Count V (Conversion and Common Law Negligence) against defendants Cecilia Keh, Voya Financial Services, Susan Bauer, and Intac Inc., and/or Ascensus LLC for: A. COMPENSATORY DAMAGES: THE SUM OF FOUR HUNDRED THOUSAND DOLLARS AS FOLLOWS : a. One Hundred Thousand Dollars 401K Conversion Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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b. Treble/Punitive Damages: $300,000.00 B. Plaintiff’s attorney’s fees for the present action C. Such other legal and equitable relief as the Court deems proper.

COUNT VI.

Employee Retirement Income Security Act Of 1974 (ERISA) -- 29 U.S.C. 1001 Et Seq - Breach of Fiduciary Duty

1. Plaintiff repeats and avers the allegations in Count I, ¶229 to ¶236, as if fully set forth herein (“RICO 401K fraud Allegations”).

2. Plaintiff also repeats and avers the allegations in Count I, Predicate Act IV, ¶122 to ¶228, as if fully set forth herein (“RICO payroll fraud allegations”). I. DEFENDANT WILLIAM P. FABIAN’S DEFERRED COMPENSATION SCHEME IS VIOLATIVE OF THE ERISA STATUTE 3. As stated in the RICO payroll fraud allegations, Mr. Fabian has paid himself over five hundred thousand dollars of decades-old “loans” and “deferred consulting fees” since November of 2012, by fraudulently receiving a weekly payroll check from the Todd Harris Company.

4. The “deferred consulting fees” were allegedly incurred between 2008 through 2012 and were not paid until he began to receive the fraudulent payroll salary in November of 2012.

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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5. This “deferred compensation” scheme is violative of the employee Retirement Income Security Act Of 1974 (ERISA) -- 29 U.S.C. 1001 Et Seq.

Plaintiff’s standing to sue derives from defendant’s fraud - but for said fraud, she would own 40% of the company directly, and 15% through a testamentary trust.

II. THE MISAPPROPRIATION OF FUNDS FROM THE LATE TODD HARRIS APPLEBAUM’S 401K PLAN, WHICH MONIES WERE THE PROPERTY OF PLAINTIFF, IS VIOLATIVE OF THE ERISA STATUTE

7. Plaintiff repeats and avers the allegations of Count I (RICO), Predicate Act V, ¶233 to ¶236 (401K RICO allegations), as if fully set forth herein.

8. Defendant Ceciliah Keh is liable under ERISA as the “named fiduciary”. The Voya/ING 401K plan is, upon information and belief, an ERISA plan.

9. Defendants VOYA/Intac/Ascensus are liable under ERISA as “functional fiduciaries” in that, inter alia, the certification signed by Intac employee Susan Bauer stated that ING (Voya) “may” rely on the certification of the named fiduciary - but need not do so. Defendant Ceciliah Keh is liable under ERISA as the “named fiduciary” and/or for “aiding and abetting”.

10. Ergo, Voya was a fiduciary with discretion to make disbursements and was liable under

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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the Employee Retirement Income Security Act Of 1974 (ERISA) -- 29 U.S.C. 1001 Et Seq. Defendant Fabian is liable for aiding and abetting.

11. Defendants VOYA/Intac/Ascensus are liable under ERISA as “functional fiduciaries” in that, inter alia, the certification signed by Intac employee Susan Bauer stated that ING (Voya) “may” rely on the certification of the named fiduciary - but need not do so.

12. Ergo, Voya was a fiduciary with discretion to make disbursements and was liable under the Employee Retirement Income Security Act Of 1974 (ERISA) -- 29 U.S.C. 1001 Et Seq.

WHEREFORE plaintiff demands judgment on this Count VI (ERISA) against defendants Cecilia Keh, Voya Financial Services, Susan Bauer, Intac Inc., and Ascensus LLC for: A. COMPENSATORY DAMAGES: THE SUM OF SEVEN HUNDRED FIFTY THOUSAND DOLLARS AS FOLLOWS : a. One Hundred Thousand Dollars 401K Withdrawal b. Payroll Fraud “Deferred Compensation” Loss: One hundred fifty thousand c. Total (Treble) Damages: $750,000.00 B. Plaintiff’s attorney’s fees for the present action C. Reinstatement of plaintiff to her former employment at the Todd Harris Company. D. Such other legal and equitable relief as the Court deems proper.

COUNT VII Intentional Infliction of Emotional Distress

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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1. Plaintiff repeats and avers the allegations in Count I, ¶1 to ¶486, as if fully set forth herein.

I. THE JUNE 27, 2013 CRISIS MEETING - INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS TO EXTORT MONEY FROM PLAINTIFF TO STAVE OFF A FRAUD LAWSUIT WHICH WAS OF THEIR OWN MAKING 2. The June 27, 2013 crisis meeting, Predicate Act II, Count I, ¶47 to ¶91, was particularly emotional and overwhelming for plaintiff.

3. The meeting came on the heels of a lawsuit by an independent financial institution which accused defendants, inter alia, of criminal fraud involving the sum of nearly five hundred thousand dollars.

4. At the said “crisis” meeting, defendants openly discussed fraud but more importantly, for purposes of this Count, they peppered plaintiff with harrowing tales regarding the impending doom of her husband’s company, using hyperbole and innuendo, to wit, “it’s sink or swim time”, “by next week the company will cease to exist”, et al.

5. Specifically, defendant Leah Capece, Esq., at that meeting uttered as follows: “This is an emergency meeting because there is a crisis here”, “if we don’t do something today, by the end of next week the Todd Harris Company will cease to exist”,

“Todd Harris

Company can be closed by the end of next week or we can make tough decisions today with your support and your assistance…”, Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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“Sun Bank has brought these proceedings….and they’re going to do everything in their power…..including destroying this company in a matter of weeks”, “even repaying this debt, it’s still possible that they could still be criminally prosecuted…”, “[w]e want you to understand what’s going on and we want you to support us in this” and “it’s sink or swim time” .

6. Defendant William P. Fabian harrassed plaintiff by stating, inter alia: “We’re screwed because of the actions we took back in November..” , “We’re in real trouble”, “they’re threatening to file criminal charges” , “You got to listen to [Capece]”.

7. In making these statements, defendants attempted to extort from plaintiff - the widow and beneficiary of her late husband’s estate - the funds necessary to stave off the “impending doom” of the company, in an amount exceeding three hundred thousand dollars.

8. The foregoing constitutes the intentional infliction of emotional distress of plaintiff, who had recently been widowed.

II. THE HARASSMENT ENDURED BY PLAINTIFF DURING THE PERIOD OF HER EMPLOYMENT AT THE TODD HARRIS COMPANY BETWEEN NOVEMBER OF 2012 AND DECEMBER 4, 2013 Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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9. Plaintiff was employed at the Todd Harris Company between November 2012 and December 4, 2013.

10. During that time, she was routinely harassed by all defendants who, as stated supra, did not welcome plaintiff at the company ab initio.

11. The foregoing constitutes the intentional infliction of emotional distress of plaintiff, who had recently been widowed. III. THE UNLAWFUL INTENTIONAL FIRING OF PLAINTIFF ON DECEMBER 4, 2013 12. Plaintiff repeats and avers the allegations in Count IV, ¶22 to ¶36, as if fully set forth herein.

13. As stated therein, plaintiff’s firing was overwhelming, unlawful, and included the unlikely presence of two police officers to effectuate same.

14. The foregoing constitutes the intentional infliction of emotional distress of plaintiff, who had recently been widowed.

IV. THE FRIVOLOUS 2017 AND 2018 PLEADINGS TO DISINHERIT PLAINTIFF AS AN ACT IN FURTHERANCE OF THE INTENTIONAL INFLICTION CLAIM CONTINUING VIOLATION THEORY AND THE STATUTE OF LIMITATIONS 15. Plaintiff repeats and avers the allegations in Count IV, ¶59 to ¶72, as if fully set forth

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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herein.

16. The frivolous verified complaints to disinherit plaintiff, filed under false pretenses in August of 2017 and then again in October of 2018, were meant to forever prevent her from having anything to do with her late husband’s only legacy - the company he built over the twenty two years he was wed to plaintiff - and with her support.

17. The foregoing constitutes the intentional infliction of emotional distress of plaintiff.

V. HARASSMENT OF PLAINTIFF BY DEFENDANT LEAH CAPECE AT PLAINTIFF’S DEPOSITION 18. In January of 2015, defendant Leah Capece conducted a two day deposition of plaintiff despite Ms. Capece or her client not being a party to the litigation.

19. The questions asked at the two-day deposition, which included references to the late Todd Harris Applebaum’s alleged promiscuity, had only one design - the intimidation and harassment of plaintiff.

20. The foregoing constitutes the intentional infliction of emotional distress of plaintiff.

VI. STATUTE OF LIMITATIONS AND LITIGATION PRIVILEGE 21. As to the statute of limitations, plaintiff hereby repeats and avers Count I, ¶400-460 as if fully set forth herein.

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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22. It is respectfully submitted that the statute of limitations was tolled for duress and pendency of a Court action per said Count I, ¶400-460.

23. As to the litigation privilege, the acts giving rise to this claim were not mere statements, and neither defendant Leah Capece or her client (THC) were a party to the litigation at the time Ms. Capece took plaintiff’s deposition. WHEREFORE plaintiff demands judgment on Count VII (Intentional Infliction) against defendants for: A. Compensatory/Punitive damages: The sum of One Million Dollars as damages for plaintiff’s emotional distress; B. Such other legal and equitable relief as the Court deems proper.

COUNT VIII Tortious Interference With Prospective Economic Advantage 1. Plaintiff repeats and avers the allegations in Count I, ¶1 to ¶478, as if fully set forth herein. 2. The defendant’s deliberate acts have resulted in the non-payment, to plaintiff, of funds from her late husband’s estate in nearly six years of Estate Administration. 3. The deliberate actions of defendants thus constitute tortious interference with plaintiff’s prospective economic advantage.

4. Specifically, defendants Fabian, Rajs, and Keh tortiously interfered in plaintiff’s right to her husband’s 401K plan, valued in excess of 100k. Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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5. Defendant Fabian, Capece, Rajs, and Gold, further interfered in plaintiff’s prospective economic advantage by conspiring to facilitate the payment to Mr. Fabian of an illicit $602,200.00 debt, while at the same time refusing to create a testamentary trust and transfer to plaintiff her share of her husband’s company.

6. The funds used to pay Mr. Fabian his illicit 602K debt would have been plaintiff’s by virtue of her ownership of the company and/or the testamentary trust - which defendant Fabian deliberately failed to create and fund.

7. Toben Property: Defendants Fabian, Rajs, Gold, and Capece, conspired to create the ruse of environmental damage of the “Toben Property”, in an effort to sell the property for Mr. Fabian’s exclusive interests, thereby tortiously interfering in plaintiff’s rights to the property.

8. 51% of the 1.5 million dollar “Toben” Property (along with the 300k per annum rental income) would have been plaintiff’s but for the tortious interference.

9. Litigation Fraud: All defendants, including the affiant defendants, conspired to create the ruse that plaintiff would “destroy” the company - as depicted inter alia by the August 2017 and October 2018 pleadings, in an effort to prevent plaintiff from continuing with her lawsuit to recover the damages she suffered.

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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10. In doing so, they interfered with her right to recover damages in a Court of law and/or with her rights to ownership in her husband’s company.

11. As to the statute of limitations and tolling, the tolling arguments regarding the RICO Count, to wit, fraudulent concealment, duress, and the pendency of another Court action are applicable to the within claims in this Count. See Count I, ¶400-460.

WHEREFORE plaintiff demands judgment on Count VIII (Tortious Interference) against defendants for: A. COMPENSATORY DAMAGES: THE SUM OF EIGHT MILLION DOLLARS AS FOLLOWS : a. Fabian Payroll Fraud Losses - Seven Hundred Thousand Dollars b. Toben Property Firesale Capital Loss - Eight hundred thousand dollars c. Prospective Damages: Toben Property Profit Loss - Over Three Million Dollars d. Payment of Fictitious Toben Salaries - over two hundred thousand dollars. e. Frank Rajs Salary Increase - nearly three hundred thousand dollars to date. f. 401K Damages - One Hundred Thousand Dollars g. Attorney’s Fees paid to defense counsel in State Court - Over One Million Dollars h. Plaintiff’s Attorney’s Fees relative to State Litigation - Over One Million Dollars i. Back pay from December 2013 to present relative to plaintiff’s employment at the Todd Harris Company - $400,000.00. B. Punitive Damages in the amount of twenty million dollars C. Plaintiff’s attorney’s fees for the present action, to wit, five hundred thousand dollars Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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D. Reinstatement of plaintiff to her former employment at the Todd Harris Company. E. An order prohibiting defendant William P Fabian from receiving further remuneration from the Todd Harris Company payroll. F. Such other legal and equitable relief as the Court deems proper.

COUNT IX COMMON LAW NEGLIGENCE

1. Plaintiff repeats and avers the allegations in Count I, ¶1 to ¶486, as if fully set forth herein.

2. At his deposition, defendant William P. Fabian acknowledged that the Sun Bank mishap occurred because of the negligence of defendants Frank Rajs and/or Cecilia Keh.

3. The Sun Bank fraud lawsuit, along with defendant Fabian’s payment to himself of his illicit and disputed “loans” and deferred “consulting” fees, resulted in a shortage of funds at the Todd Harris Company and is directly related to the subsequent firesale of the lucrative “Toben commercial property” at one half of its appraised value.

4. The Sun National Bank mishap also resulted in the non-payment to plaintiff, in six years of estate administration, of any funds whatsoever from her late Husband’s estate.

WHEREFORE plaintiff demands judgment on Count IX (Negligence) against defendants for: Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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A. COMPENSATORY DAMAGES - THE SUM OF EIGHT MILLION DOLLARS AS FOLLOWS: a. Fabian Payroll Fraud Losses - Seven Hundred Thousand Dollars b. Toben Property Firesale Capital Loss - Eight hundred thousand dollars c. Prospective Damages: Toben Property Profit Loss - Over Three Million Dollars d. Payment of Fictitious Toben Salaries - over two hundred thousand dollars. e. Frank Rajs Salary Increase - nearly three hundred thousand dollars to date. f. 401K Damages - One Hundred Thousand Dollars g. Attorney’s Fees paid to defense counsel in State Court - Over One Million Dollars h. Plaintiff’s Attorney’s Fees relative to State Litigation - Over One Million Dollars i. Back pay from December 2013 to present relative to plaintiff’s employment at the Todd Harris Company - $400,000.00. B. Punitive Damages in the amount of twenty million dollars C. Plaintiff’s attorney’s fees for the present action D. Reinstatement of plaintiff to her former employment at the Todd Harris Company. E. An order prohibiting defendant William P Fabian from receiving further remuneration from the Todd Harris Company payroll. F. Such other legal and equitable relief as the Court deems proper.

COUNT X John Does 1-10 and ABC Corp 1-10

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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Plaintiff repeats the allegations contained in Count 1 of this Complaint and makes

them a part hereof.

The defendants, ABC-Corp 1-10. and John Does l-l0 are fictitious names intended

to identify any and all parties, including individuals, corporations and/or other entities whose identities are presently unknown to the plaintiffs, who together with the named defendants were responsible for acts or omissions plead herein, or who in any way caused or contributed to plaintiff’s damages.

As a direct and proximate result of the intentional torts or negligence of

defendants aforesaid, plaintiff suffered direct, consequential, and exemplary damages.

WHEREFORE plaintiff demands judgment on this Count against defendants for: A. COMPENSATORY DAMAGES: THE SUM OF EIGHT MILLION DOLLARS AS FOLLOWS : a. Fabian Payroll Fraud Losses - Seven Hundred Thousand Dollars b. Toben Property Firesale Capital Loss - Eight hundred thousand dollars c. Prospective Damages: Toben Property Profit Loss - Over Three Million Dollars d. Payment of Fictitious Toben Salaries - over two hundred thousand dollars. e. Frank Rajs Salary Increase - nearly three hundred thousand dollars to date. f. 401K Damages - One Hundred Thousand Dollars g. Attorney’s Fees paid to defense counsel in State Court - Over One Million Dollars h. Plaintiff’s Attorney’s Fees relative to State Litigation - Over One Million Dollars

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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i. Back pay from December 2013 to present relative to plaintiff’s employment at the Todd Harris Company - $400,000.00.

B. Punitive Damages in the amount of twenty million dollars C. Plaintiff’s attorney’s fees for the present action D. Reinstatement of plaintiff to her former employment at the Todd Harris Company. E. Such other legal and equitable relief as the Court deems proper.

COUNT XI New Jersey RICO Statute

Plaintiff repeats the allegations contained in Count I of this Complaint and makes

them a part hereof.

The defendants are liable under New Jersey’s RICO Statute, to wit, N.J.S.A. §

2. 2C:41-2(c).

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e. Frank Rajs Salary Increase - nearly three hundred thousand dollars to date. f. 401K Damages - One Hundred Thousand Dollars g. Attorney’s Fees paid to defense counsel in State Court - Over One Million Dollars h. Plaintiff’s Attorney’s Fees relative to State Litigation - Over One Million Dollars i. Back pay from December 2013 to present relative to plaintiff’s employment at the Todd Harris Company - $400,000.00.

COUNT XII SEC 10B-5

1. Plaintiff repeats the allegations contained in Count XV, and Count I, ⁋318 to ⁋332, and ⁋471 to ⁋474 of this Complaint and makes them a part hereof.

2. In August of 2017 and October of 2018 defendants Mr. William P. Fabian and his counsel Thomas S. Howard, Esq., filed frivolous retaliatory pleadings, under false pretenses, to sell plaintiff’s 40% stake in her husband’s company, which Mr. Fabian and Ms. Capece had repeatedly promised she would get prior to litigation, and which her late husband specifically wanted her to inherit by way of the residuary clause of his last will and testament (e.g. Cavise Deposition, Count I, Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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⁋17).

3. As set forth at Count I, Predicate Act VI, Mr. Fabian and his counsel made these attempts to disinherit plaintiff by relying inter alia o n specious affidavits which were wholly irrelevant as regards her minority shareholder status.

4. Moreover, in December of 2018 Mr. Howard and Mr. Fabian misrepresented to the Court the status of the law and of the facts. As to the law, they cited an opinion, the “Hope” opinion, in support of their argument that plaintiff could be disinherited - when in reality the said opinion in fact stood as an obstacle, as it did not permit disinheritance upon objection by the executor, the testamentary trust, and/or THC.

5. Further, Mr. Howard in December of 2018 misrepresented to the Court a pivotal fact - that the testamentary trust had objected to distribution of plaintiff’s shares in-kind, when in fact two of the three trustees had not objected to in-kind distribution.

6. Since plaintiff had been repeatedly promised the shares, an in particular at a meeting of December 8, 2012 she was treated as a shareholder (as depicted by the meeting minutes), and since plaintiff’s husband unequivocally gave her a 40% stake through the residuary clause of his will (unaware that she could lose same), plaintiff was in this circumstance a “de facto seller” and/or a “forced seller” of

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securities and has standing to sue.

7. Defendants Fabian and Howard thus sought to or did sell plaintiff’s 40% stake at little over 200K, under false pretenses, despite her own expert who valued the shares at over one million dollars.

8. Said defendants, having attempted and/or otherwise succeeded in selling plaintiff’s shares under false pretenses, using a summary probate proceeding lacking due process and/or genuine fact finding, are liable pursuant to 17 C.F.R. 240.10b-5

WHEREFORE plaintiff demands judgment on this Count against defendants for: A. COMPENSATORY DAMAGES: THE SUM OF FIVE MILLION DOLLARS AS FOLLOWS : a. One million in actual compensatory capital losses. b. two million in lost profits. B. Punitive Damages in the amount of two million dollars C. Plaintiff’s attorney’s fees for the present action D. Such other legal and equitable relief as the Court deems proper.

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COUNT XIII BREACH OF FIDUCIARY DUTY

1. Plaintiff repeats the allegations contained in Count I (RICO) , Count IV (CEPA), and Count XV (fraudulent concealment) of this Complaint and makes them a part hereof.

2. Defendant Fabian’s attempts to disinherit plaintiff by selling her 40% stake in THC at a premium, as executor of the estate of her late husband, under false pretenses, in retaliation for her whistleblower activities, constitutes a violation of his fiduciary duties.

3. Defendant Fabian’s failure to give plaintiff any monies from her late husband’s estate for six years, from 2012 through present, constitutes a violation of his fiduciary duties.

4. Defendant Fabian’s defamation of plaintiff, in stating that plaintiff is acting out of “anger”, when in reality her concerns stem from the Sun Bank Fraud lawsuit of 2013 as well as other documented instances of fraud she witnessed (e.g. the payroll fraud), constitutes a violation of his fiduciary duties.

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c. Prospective Damages: Toben Property Profit Loss - Over Three Million Dollars d. Payment of Fictitious Toben Salaries - over two hundred thousand dollars. e. Frank Rajs Salary Increase - nearly three hundred thousand dollars to date. f. 401K Damages - One Hundred Thousand Dollars g. Attorney’s Fees paid to defense counsel in State Court - Over One Million Dollars h. Plaintiff’s Attorney’s Fees relative to State Litigation - Over One Million Dollars

B. Punitive Damages in the amount of twenty million dollars C. Plaintiff’s attorney’s fees for the present action

D. Such other legal and equitable relief as the Court deems proper. COUNT XIV BREACH OF FIDUCIARY DUTY - AIDING AND ABETTING BY NON-FIDUCIARY DEFENDANTS

1. Plaintiff repeats the allegations contained in Count XIII (Breach of Fiduciary Duties) and Count XV (fraudulent concealment) of this Complaint and makes them a part hereof.

2. Defendants Thomas Howard, Esq., Rajs, Gold, Capece, and the “affiant defendants”, are liable for aiding and abetting defendant Fabian in his breach of his fiduciary duties as set forth at Count XIII (Breach of Fiduciary Duties) and Count XV (fraudulent concealment) .

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3. Specifically, Rajs, Gold, and Capece explicitly approved the payroll fraud, as Mr. Fabian admitted on August 2013 (in relation to Gold and Rajs) infra, and as depicted the the December 9, 2012 minutes signed by Mr. Rajs and Ms. Capece, which ratified the fraud.

4. Mr. Rajs and Mr. Laurence Gold’s role in approving the payroll fraud was thus specifically set forth by Mr. Fabian at a recorded August 2013 meeting, wherein he uttered “Frank and I and Larry [M r. Gold] agreed that that would be the best way to take it.” Count I, ¶137.

5. In addition to the foregoing, Mr. Gold knowingly solicited loans from commercial lenders in 2010 and 2013 while concealing inter alia Mr. Fabian’s indebtedness.

6. The payroll fraud has resulted in the nonpayment to plaintiff of her inheritance and THC profits for six years.

7. Mr. Gold also knowingly submitted an affidavit in Court in late 2018, in which he falsely claimed to have been unaware of the Sun Bank Lawsuit of 2013 - a lawsuit which was the catalyst of p laintiff’s lawsuits. Mr. Gold did so in order to assist defendant Fabian and his counsel’s Thomas S. Howard post-suit litigation fraud.

8. Ms. Capece is further liable inter alia for the reasons set forth at Count I, Predicate Act IV, and because of her role in the sale of the “Toben” property at half of the appraised

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value under the guise of environmental damage.

9. The “affiant defendants” are liable in that they knowingly executed affidavits, after the filing of plaintiff’s lawsuit, which purported to justify an otherwise unlawful firing by falsely claiming that plaintiff would “destroy” the company and/or that they would cease working at the company if plaintiff were allowed to work there.

10. Maxine Melnik is liable in that she knowingly notarized “employee affiant” affidavits she knew would be used to justify plaintiff’s unlawful firing, and she also knowingly notarized the February 15, 2010 “Fabian” Employment agreement, which was used to conceal, in Court, the payroll fraud, said employment agreement being characterized as a fraud by its purported author, lawyer/businessman Paul Cavise. See Count I, ¶194.

11. Cecilia Keh is liable for aiding and abetting as set forth at Count VI, ERISA.

12. Cecilia Keh and Thomas D’Ambrosio are liable for aiding and abetting because of their intimate financial involvement with THC, as such they were or should have been aware of the payroll fraud which has cost plaintiff her inheritance for six years.

13. Defendant Thomas S. Howard, Esq. of Gartenberg Howard, LLP, is further liable for the comprehensive reasons set forth at Count XV (Fraudulent Concealment).

WHEREFORE plaintiff demands judgment on this Count against defendants for: A. COMPENSATORY DAMAGES: THE SUM OF EIGHT MILLION DOLLARS AS Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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FOLLOWS : a. Fabian Payroll Fraud Losses - Seven Hundred Thousand Dollars b. Toben Property Firesale Capital Loss - Eight hundred thousand dollars c. Prospective Damages: Toben Property Profit Loss - Over Three Million Dollars d. Payment of Fictitious Toben Salaries - over two hundred thousand dollars. e. Frank Rajs Salary Increase - nearly three hundred thousand dollars to date. f. 401K Damages - One Hundred Thousand Dollars g. Attorney’s Fees paid to defense counsel in State Court - Over One Million Dollars h. Plaintiff’s Attorney’s Fees relative to State Litigation - Over One Million Dollars

COUNT XV FRAUDULENT CONCEALMENT (SPOLIATION)

TABLE OF CONTENTS I. LIABILITY OF THOMAS S. HOWARD, ESQ. i The Filing Of An Employment Agreement To Conceal Payroll Fraud Mr. Fabian Repeatedly Admitted Prior To Litigation ii. The Submission And Creation Of Defendant Fabian Certifications By Mr. Howard To Conceal Payroll Fraud And To Brazenly Refute Compelling Pre-litigation Admissions Of Fraud By Mr. Fabian iii. Mr. Howard’s Attempts To Conceal From The Probate Court A Material Fact: The Filing Of The Sun Bank Lawsuit In 2013 Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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iv. Mr. Howard’s Attempts To Conceal A Material Fact From The Appellate Division: The Filing Of The Sun Bank Lawsuit In 2013 v. Mr. Howard’s Attempts To Conceal And/Or Prevent The Discovery Of Evidence, Specifically The Deposition Of Accountant Lawrence Gold, By Falsely Claiming All Discovery Was Complete vi. Mr. Howard’s Attempts To Completely Disinherit Plaintiff By Falsely Stating That The ‘affiants” And Other Company Employees Objected To Distribution In-kind Of The Shares Of Her Late Husband’s Company

II. LIABILITY OF LAURENCE GOLD AS TO FRAUDULENT CONCEALMENT AND ADDITIONAL LIABILITY OF THOMAS S. HOWARD FOR CONCEALMENT OF SOURCE OF BAILOUT FUNDS III. LIABILITY OF FABIAN AND OTHER PARTIES

FRAUDULENT CONCEALMENT COMPLAINT 1. Plaintiff repeats the allegations contained in Count I, ¶1-¶488 as if fully set forth herein. I. LIABILITY OF THOMAS S. HOWARD, ESQ.

2. Attorney Thomas S. Howard, Esq., has been the attorney for the Estate of Todd Harris Applebaum, and for Defendant William P. Fabian, since March 2014 through present.

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3. During that time, Mr. Howard has inter alia committed the following seven forms of fraudulent concealment while litigating in State Court:

4. First, Mr. Howard knowingly filed a fraudulent employment agreement (“EA”) in 2017 and 2018 to conceal defendant Fabian’s 600K payroll fraud from the Court, which payroll scheme defendant Fabian repeatedly admitted prior to being sued, as depicted in recordings forwarded to all counsel in 2014.

5. Second, Mr. Howard in 2017 and 2018 knowingly filed and/or drafted one or two certifications or affidavits wherein defendant Fabian sought to deny or refute compelling pre-litigation admissions of fraud he himself had made and which were recorded and forwarded to all parties in 2014.

6. Third, Mr Howard filed a certification in State Court, signed by him, in which he knowingly explicitly set forth that the pivotal, material, and significant Sun Bank Lawsuit of 2013 was never filed. A Wells Fargo banker characterized the Sun Bank lawsuit as material at his deposition and contended that it should have been disclosed to the bank.

7. Fourth, Mr. Howard, having then received further proofs of the Sun Bank lawsuit which he was nonetheless previously aware of, knowingly once again set forth in an interlocutory appeal brief that the Sun Bank lawsuit was never filed, thus potentially resulting in a denial of the appeal by the appellate division.

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8. Fifth, Mr. Howard in 2018 knowingly misrepresented the status of discovery as having been “completed” in order to forestall key discovery which included the deposition of the company accountant Gold - which had been sought by a motion to compel the Court had not yet decided.

9. Sixth, Mr. Howard twice knowingly misinterpreted and misrepresented in State Court the pre-litigation certifications by the “affiants”, Mr. Fabian, and Mr. Rajs, in his numerous attempts to disinherit plaintiff completely and permanently by setting forth a factual argument not specifically supported by said certifications.

The Filing Of An Employment Agreement To Conceal Payroll Fraud Mr. Fabian Repeatedly Admitted Prior To Litigation 10. Summary: In August of 2017 and October of 2018, Mr. Howard filed a questionable employment agreement (“EA”), as “Exhibit 11” to a Certification, which purported to justify defendant Fabian’s 2K weekly Todd Harris Company (“THC”) salary. Mr. Fabian began “earning” this salary within hours after the passing of Todd Harris Applebaum in November of 2012. The EA, which was produced only after Mr. Fabian was sued, directly contradicts over ten hours of recorded admissions by Fabian and the other defendants, in which they unequivocally stated that the disputed payroll payments where in satisfaction of a disputed 600K debt - i.e. that the 2k weekly payments were not bona fide payroll payments related to actual employment.

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11. Plaintiff hereby sets forth the allegations at [Count I, ¶188 to ¶199] as if fully set forth herein, as they relate to the proofs regarding the fraudulent nature of the EA defendant Fabian produced for the first time after he was sued by plaintiff in 2014.

12. The purported drafter of said EA, attorney/business consultant Paul Cavise, all but called the EA a fraud, and the EA also contains compelling indicia of fraud within its four corners. See [Count I, ¶188 to ¶199] .

13. Mr. Howard, prior to filing the said EA in August of 2017 and October of 2018 in an attempt to mask Mr. Fabian’s payroll fraud, had been served with numerous recordings and transcripts which included Mr. Fabian’s repeated admissions regarding the nature of the 2K weekly payroll payments he had been receiving since decedent passed. Specifically - that the said payments were not for actual work under an employment agreement, but rather for repayment of a disputed 600K debt which lacks any proofs.

[INTENTIONALLY LEFT BLANK]

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14. Thus, on August 26, 2014, Mr. Howard was provided with transcripts and recordings:

[INTENTIONALLY LEFT BLANK]

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15. Mr. Howard’s name appears in the “cc:” section and indicates he was forwarded the enclosures, e.g., “w/ encl.” - thus substantiating his scienter and knowledge of Mr. Fabian’s admissions:

16. In particular, the August 2013 meeting transcript referenced in that letter, which meeting was between Mr. Fabian and plaintiff’s two attorneys, contained a detailed discussion of the specifics of the payroll fraud and defendant Fabian’s brazen admissions. [Count I, ⁋137]

17. Mr. Fabian also admitted the fraud on December 9, 2012, at a THC Board Meeting, [Count I, ⁋133], wherein the fraud was formally ratified, and on September 4, 2013, he once again admitted the payroll fraud in a handwritten notepad missive wherein he wrote the balance on his disputed account after same was reduced by the payroll payments he Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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had received to date. [Count I, ⁋202].

18. In his answers to interrogatories, presumably prepared by Mr. Howard and/or his law firm, Mr. Fabian admitted that the did not engage in the payroll scheme in 2011 - prior to decedent’s death - because the THC company was under audit.

19. Aware of the said payroll scheme which defendants prior to being sued repeatedly admitted, Mr. Howard nonetheless filed an EA which itself contained compelling indicia of fraud, [See Count I, ¶198, incorporated herein by reference], in an attempt to argue that said EA - which also contained unconscionable terms and clauses - permitted Mr. Fabian to draw the 2k weekly salary for actual work performed.

20. In doing so, Mr. Howard set forth that Fabian’s post-suit certifications, infra, in tandem with the EA, permitted Mr. Fabian to work for the 2K payroll payments, and that the said payments were therefore not in satisfaction of the disputed 600k debt, notwithstanding Mr. Fabian brazen and repeated admissions prior to being sued that in fact the payments were in satisfaction of said disputed debt.

21. The “Fabian certification” which included the fraudulent EA as “Exhibit 11” was prepared by counsel, as Mr. Fabian was presumably in Florida at the time it was drafted, infra. ii.

The Submission And Creation Of Defendant Fabian Certifications By Mr. Howard To Conceal Payroll Fraud And To Brazenly Refute Compelling Pre-litigation Admissions Of Fraud By Mr. Fabian

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22. The fraudulent EA was filed numerous times in State Court, most prominently in August of 2017 and October of 2018 as an exhibit to Mr. Fabian’s April 20, 2016 certification (“Exhibit 11”), in an attempt to mask the payroll fraud with the end-goal of seeking the permanent disinheritance of plaintiff because of her “frivolous” lawsuits.

23. In this clearly specious certification, Count I, ⁋295, Mr. Fabian inter alia set forth that he had been employed pursuant to the EA, and that after he began to receive the payroll payments, he realized at some point that he should be paid for his current “work” at THC, which “work” to date he has provided no specifics for.

24. Prior to being sued in March of 2014, Mr. Fabian maintained repeatedly that the payroll payments were for repayment of his disputed loans. Presumably, then, he “changed his mind” and started “working” under the EA only after he was sued, although there are no business records memorializing same. In contrast, there are business records (board meeting minutes of December 2012), explicitly ratifying the payroll scheme.

25. To date, Mr. Fabian has been unable to identify the precise date he began to “work” for the payroll payments - although the proofs indicate that this “change of mind”, which he also referenced in his September 2017 deposition, is merely a post-suit strategy meant to mask the payroll from the Court, as there is no pre-suit evidence whatsoever which indicates he was working under an EA, and he has been unable to provide the specifics of this alleged “work”.

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26. In addition, the EA was first introduced into this case after plaintiff’s March 2014 state court lawsuit.

27. As such, Fabian’s certification directly contradicts and refutes repeated, compelling, and brazen pre-suit admissions of fraud, supra, and as such Mr. Howard in preparing and/or relying on same in August of 2017 and October of 2018 in order to mask the payroll fraud - with the end goal of disinheriting plaintiff permanently - is liable for fraudulent concealment and for the totality of plaintiff’s post suit losses, which encompass millions of dollars in attorney’s fees paid by the Estate of which she is the primary beneficiary. iii.

Mr. Howard’s Attempts To Conceal From The Probate Court A Material Fact: The Filing Of The Sun Bank Lawsuit In 2013 28. Plaintiff sets forth and repeats the allegations of Count I, ¶21-¶29 as if fully set forth herein (Sun Bank fraud lawsuit of 2013 allegations).

29. Plaintiff sets forth and repeats the allegations of Count I, ¶47-¶52 as if fully set forth herein (June 27, 2013 “crisis” meeting convened as a result of the Sun Bank fraud lawsuit).

30. Plaintiff sets forth and repeats the allegations of Count I, ¶110 as if fully set forth herein (Wells Fargo executive February 2018 deposition wherein he unequivocally states that the nondisclosure of the Sun Bank lawsuit was a material omission).

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31. The 2013 Sun Bank fraud lawsuit against the Estate and defendants Rajs and Keh was essentially the primary catalyst for plaintiff’s whistleblower activity, which subsequently led to her discharge from her late husband’s company in late 2013, and the subsequent filing of her lawsuit in early 2014, followed by defendant’s retaliatory “SLAPP” attempts to disinherit her in 2017 and 2018.

32. Mr. Thomas S. Howard is an experienced and knowledgeable attorney who in 2014 was served with copies of transcripts and recordings which clearly depict inter alia the all-encompassing and pivotal Sun Bank Fraud lawsuit (filed circa June 25, 2013). Most prominently, the Sun Bank lawsuit was the focus of the June 27, 2013 “crisis” meeting:

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33. Mr. Howard’s name appears in the “cc:” section and indicates he was forwarded the enclosures, e.g., “w/ encl.” - thus substantiating his scienter and knowledge of the Sun Bank lawsuit, as same was discussed at length at the June 27, 2013 “Crisis” meeting:

[INTENTIONALLY LEFT BLANK]

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34. Mr. Howard on May 15, 2017 was also served with a copy of the Sun Bank “counsel” subpoena which prominently depicted the “Sun Bank fraud lawsuit” docket number, to wit, SOM-L-00838-13:

35. On May 16, 2017, Mr. Thomas S. Howard was again served with the said Sun Bank counsel” subpoena which similarly prominently depicted the docket number.

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36. On June 1, 2017, counsel for Sun National Bank, Hill Wallack, forwarded to all parties via Lawyer’s Service - including Mr. Howard - correspondence related to the “counsel” subpoena and in that correspondence prominently set forth the docket number of the Sun Bank fraud lawsuit:

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37. Subsequently, on July 20, 2017, in open Court, Mr. Howard admitted he in fact read the subpoena - and was therefore ipso facto aware the Sun Bank lawsuit was filed and had a docket number: Mr. Howard: I believe Your Honor has some documents that were produced by Sun Bank in response to a subpoena. …..My client would like to be able to review what it is that Sun Bank produced to see if we have any objection…[comments by Judge omitted]...I believe it did. That's what the subpoena said.

38. Mr. Howard has also appeared at nearly every hearing (more than one dozen) since 2014 in State Court, has drafted affidavits, interrogatories, and other discovery, and has referenced and/or has been keenly aware that the Sun Bank Lawsuit of 2013 nearly resulted in the demise of the Todd Harris Company, and was essentially the primary catalyst for plaintiff’s lawsuits.

39. Thus, by way of example (among dozens more), at a hearing on May 22, 2014 Mr. Howard himself admitted being aware of the significance of the Sun Bank fraud lawsuit and that it in fact had been filed:

I would point out also, Mr. Fabian actually came in and took $350,000 of his own money to save this business, which is when the Sun Bank issue became such a big problem in the spring, late spring/early summer 25 of last year. And he came forward with the money that was necessary to make Sun Bank agree to drop the lawsuit. If that had not happened we would not be here today arguing about the continuation of the company, its operations or anything because the company would no longer exist.

40. Mr. Howard thus admitted in 2014 that Sun Bank had to “drop” the “big problem” fraud

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lawsuit of 2013.

41. It is axiomatic that a lawsuit that was never filed cannot be “dropped”.

42. In February of 2018, Wells Fargo executive Kevin Harvey in no uncertain terms stated that the nondisclosure of the Sun Bank lawsuit by defendant Gold in 2013, acting on behalf of THC and Mr. Fabian, was a material omission. Count I, ¶110.

43. This led defendant Gold, infra, to file a certification in 2018 claiming he was unaware of the Sun Bank lawsuit (despite compelling evidence proving otherwise, infra), and it was also among the reasons for Mr. Howard’s attempts herein to make the Sun Bank lawsuit “disappear” - as Mr. Howard, Mr. Fabian, and Mr. Gold are RICO co-conspirators.

44. Thus, given the foregoing compelling proofs of Mr. Howard’s knowledge regarding the filing of the Sun Bank fraud lawsuit against the Estate he was representing, and given his breadth of experience as a lawyer, he should have had no doubts that the lawsuit had been “filed” - and he should never have signed a certification, under any circumstance, stating (three times) that the lawsuit was “never filed”, infra.

45. Notwithstanding the foregoing Mr. Howard on October 30, 2018 brazenly signed and filed a certification prominently stating - three times - that the rather conspicuous Sun Bank lawsuit had not been filed because, as he claimed, it did not appear in the public

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court access portal (ACMS) for the search term “Todd Harris Company”:

46. Notably, the “Todd Harris Company” was the only search term he searched for in the multi-party Sun Bank Lawsuit of 2013, which he was aware had a docket number - and he did not search for said docket number.

47. Mr. Howard also brazenly “concluded” in his certification that the Sun Bank complaint

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served on the defendants in 2013 by a prominent law firm (Hill Wallack) , was merely a “draft”.

48. Given the brazen nature of these acts by Mr. Howard, on November 2, 2018 plaintiff contacted a Superior Court clerk, Mr. Robert Vivalo, (908)332 7700 ext. 13710, and once again confirmed the obvious - that the suit had in fact been filed.

49. Specifically, Mr. Vivalo confirmed that the Sun Bank suit was filed on 6/25/13 and it was dismissed with prejudice on 7/9/13.

50. Plaintiff then promptly prepared and filed a certification reciting these facts, and served same on all parties, including Mr. Howard, who would nonetheless continue to brazenly make this deliberate misrepresentation of a material fact in a subsequent interlocutory appeal, infra.

iv. Mr. Howard’s Attempts To Conceal A Material Fact From The Appellate Division: The Filing Of The Sun Bank Lawsuit In 2013

51. Notwithstanding the overwhelming proofs that the Sun Bank lawsuit had been filed, on December 18, 2018, in an appellate court submission, Mr. Howard brazenly attempted to once again claim the Sun Bank lawsuit was “never” filed and that defendants had been served a “draft” complaint only - by prominent law firm Hill Wallack.

52. This misrepresentation, among others, resulted in a “no comment” denial by the appellate

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division of an otherwise meritorious appeal with formidable and admissible proofs of fraud, and it also led to significant attorneys fees incurred by plaintiff and the estate of which she is the primary beneficiary.

53. For the foregoing reasons, Mr. Howard, and his law firm, are liable for fraudulent concealment and for the entirety of plaintiff’s post-suit damages, which includes millions of dollars of attorneys fees paid by the Estate of which plaintiff is the primary beneficiary.

Mr. Howard’s Attempts To Conceal And/Or Prevent The Discovery Of Evidence, Specifically The Deposition Of Accountant Lawrence Gold, By Falsely Claiming All Discovery Was Complete

54. At a hearing in late 2018, Mr. Howard knowingly mis-informed the Court that all discovery was complete, and that plaintiff had obtained “all” of the discovery she sought.

55. This, notwithstanding that Mr. Howard was aware of the plaintiff’s ongoing year-long efforts to obtain significant discovery, most prominently the deposition of defendant accountant Laurence W. Gold, which was sought by a motion for nearly a year, a motion which at one point the Court characterized as “missing”.

56. The deposition of Mr. Gold, in a case which subsists on financial wrongdoings and crimes, is among the most significant.

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57. As a result of Mr. Howard’s deliberate misrepresentations, the deposition of Mr. Gold has not been conducted to date.

58. The foregoing constitutes fraudulent concealment of the deposition of Mr. Gold, and other outstanding discovery Mr. Howard was aware of, in that it was Mr. Howard’s design to conspire with the co-defendants to prevent this significant deposition from taking place.

vi.

Mr. Howard’s Attempts To Completely Disinherit Plaintiff By Falsely Stating That The ‘affiants” And Other Company Employees Objected To Distribution In-kind Of The Shares Of Her Late Husband’s Company

59. Plaintiff hereby sets forth and repeats the following counts/allegations as if fully set forth herein, Count I, ¶59 to ¶72, and Count IV (CEPA and Pierce), ¶76 to ¶123, as same relate to the two retaliatory pleadings to completely disinherit plaintiff filed by Mr. Howard on behalf of Mr. Fabian in August of 2017 and October of 2018.

60. The issue in these pleadings was whether plaintiff school-teacher could “destroy” the Todd Harris Company (“THC”) by virtue of her employment at THC, and/or because of the filing of her two lawsuits. 61. As set forth at Count I, ¶59 to ¶72, and Count IV (CEPA and Pierce) , ¶76 to ¶123, Mr. Howard frivolously premised the retaliatory pleadings primarily on the following two

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sets of “facts”: (i) plaintiff’s acts as an employee of THC - despite the conspicuous fact that she had been fired from THC in late 2013 and (ii) the filing of plaintiff’s lawsuits, most prominently (e.g. as Mr. Howard claimed, the “best evidence”), the filing of her Federal RICO lawsuit, which Mr. Howard referred to as “fulminations directed at top management” allegedly stemming from plaintiff’s disenchantment with her inheritance (despite her being the primary beneficiary who stood to own 55% of THC directly and via a trust).

62. Mr. Howard in those pleadings inter alia further frivolously asserted that that plaintiff’s son, the President of THC, had objected to plaintiff receiving a distribution of her 40% shares in-kind.

63. In fact, her son had not so objected, he merely signed an affidavit in 2014 prepared by defendant Capece in which he stated, in a rather apologetic manner, that his mother was not welcomed at the company because of her demeanor - his sources for this assessment were defendants themselves, who in their own affidavits expressed concern with plaintiff’s comprehensive whistleblower activity.

64. Plaintiff’s son’s affidavit was prepared over six months after she had been discharged from THC, and was meant to ex-post-facto justify the December 2013 firing.

65. Moreover, as Mr. Howard as aware, and as depicted by the “second bite at the apple” Hope brief issue, there could be no objections to the in-kind distribution of the 40%

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shares plaintiff stood to inherit, since the case law did not support same in the context of a sole beneficiary of an estate asset.

66. That is to say - there could be no objections as plaintiff was the sole beneficiary of the asset (40% shares), and only a co-beneficiary of the same a sset could object to a distribution pursuant to the sole case relied upon by Mr. Howard, the “Hope” case.

67. Nonetheless, in an effort to penalize plaintiff for her Federal lawsuit (“fulminations against top management”), and in order to protect his own interests by “prevailing” through fraud, Mr. Howard brazenly misrepresented the facts - and the law - in the course of filing these pleadings and is therefore liable for fraudulent concealment of one salient fact - that there were no lawful objections to in-kind distribution of the 40% shares of THC plaintiff would otherwise inherit.

68. As of the date of this proposed complaint, the state Court Judge has not decided the issue of in-kind distribution, and to the extent he rules against plaintiff, it is respectfully submitted that the issue of fraudulent concealment can nonetheless be visited by this Court, as there has been no formal fact finding by the State Court judge, and his ruling “on the papers” therefore cannot constitute res judicata.

69. In the meantime, plaintiff has suffered losses as a result of this fraudulent concealment, in the form of excessive attorneys fees paid to Mr. Howard by the estate of which she is a beneficiary, and attorneys fees paid to her own counsel.

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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II. OF LAURENCE GOLD AS TO FRAUDULENT CONCEALMENT AND ADDITIONAL LIABILITY OF THOMAS S. HOWARD FOR CONCEALMENT OF SOURCE OF BAILOUT FUNDS

LIABILITY

70. Defendant Laurence W. Gold has been the Todd Harris Company’s (“THC”) accountant for over a decade.

71. To date, he has avoided a deposition, prompting the plaintiff to file a motion to compel in mid-2017 which went undecided for over a year, was then deemed “missing”, and finally in late 2018 was denied as untimely.

72. More importantly, Mr. Gold as been involved in all financial transactions, most prominently those involving fraud, e.g. the payroll fraud, the settlement of the Sun Bank lawsuit of 2013, and the attempts to defraud banks in 2013 by concealing various adverse financials.

73. The adverse financials concealed from banks include the Sun Bank lawsuit, the payroll fraud and the related 600K disputed debt, and a 350K personal debt owed the executor in June of 2013 for providing the source of the Sun Bank bailout funds in an amount of approximately 350K.

74. In February of 2018, a Wells Fargo executive at his deposition conceded that Mr. Gold in mid-2013 did not disclose various adverse THC financials, including the filing of the Sun

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Bank lawsuit, which the Wells Fargo executive (Kevin Harvey) specifically deemed to be a significant material omission. Count I, ⁋110.

75. The Court was then alerted of this bank fraud in plaintiff’s June 2018 motion to remove Mr. Fabian as executor of the estate and Mr. Gold as accountant of THC, prompting Mr. Gold on July 30, 2018 to file a certification in which he brazenly denied being aware of the Sun Bank lawsuit of 2013.

76. In fact, however, the proofs showing he was aware of the Sun Bank suit are compelling. For instance, Mr. Gold’s invoices and recordings show he was present at the “crisis” meeting of June 27, 2013, which meeting was precipitated by the Sun Bank lawsuit, and in which meeting they thoroughly discussed same. Count I, ⁋485. 77. Moreover, significantly at the June 27, 2013 “crisis” meeting Mr. Gold witnessed and signed a 350K promissory note/lien, [Complaint, Preliminary Statement, ¶12] payable to the order of Mr. William P. Fabian, in consideration for the monies Mr. Fabian personally loaned the company (THC), to settle the Sun Bank Lawsuit (350K).

78. As such, Mr. Gold was clearly aware of the Sun Bank lawsuit, and did not disclose same to Wells Fargo, and his certification filed in State Court in late 2018 brazenly denying his knowledge of the Sun Bank lawsuit constitutes fraudulent concealment. 79. In addition, having witnessed and signed a 350K promissory note by THC in favor of Mr. Fabian, supra, Mr. Gold was clearly also aware that Mr. Fabian personally w as owed 350K by THC. 80. In fact, Mr. Fabian in an affidavit stated that he was owed this debt personally, and not as executor, Count I, Predicate Act III, ¶112.

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81. Thus, although Mr. Gold was aware that Mr. Fabian was a creditor o f THC by virtue inter alia of the 350K note, he misrepresented to Wells Fargo that the 350K bailout sum was owed to the Estate - that the Estate was the creditor and not Mr. Fabian personally. 82. Defendant Thomas S. Howard, Esq. as set forth infra exploited said bank fraud by Mr. Gold by fraudulently arguing in late 2018, in both the Chancery and Appellate Divisions, that Mr. Gold properly disclosed that the Estate was the creditor relative to the 350K note - when in reality it was Mr. Fabian personally. 83. Thus Mr. Howard has knowingly misrepresented in both the Chancery Division as well as the Appellate division in late 2018, that Mr. Gold did not commit bank fraud, by concealing the true source of the bailout funds from the Court. 84. Mr. Howard and Mr. Gold are therefore both liable for fraudulent concealment of (i) Mr. Gold’s knowledge of the Sun Bank lawsuit and (ii) the source of the bailout funds stemming from the Sun Bank lawsuit. Both of these items were concealed from the State Court in an attempt to argue that defendants did not commit fraud.

85. QED.

LIABILITY

III.

OF FABIAN AND OTHER PARTIES

86. Mr. Howard’s fraudulent concealment liability rests primarily on his brazen and remarkable attempt to “disappear” the pivotal Sun Bank lawsuit of 2013, in a certification he personally signed in late 2018.

87. Mr. Howard is further liable in that he relied upon and/or prepared Mr. Fabian’s

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certification(s), in which Mr. Fabian brazenly - and only after being sued- attempted to refute his myriad compelling pre-suit admissions regarding the payroll fraud. In furtherance of this goal, Mr. Howard attached to Fabian’s certification a specious “employment agreement” which was remarkable and unconscionable in its own right, as it contained clauses and terms that no reasonable businessman would agree to, and it also contained compelling indicia of fraud - in that the signatures appeared to be forged.

It is

of little value to defendants that the purported author of the EA all but called it a fraud.

88. Mr. Fabian is liable for authoring and/or providing the misleading falsehoods in the certification, and for relying upon and/or creating a fraudulent employment agreement with the goal of refuting or denying a payroll scheme he had previously repeatedly admitted to prior to being sued.

89. Mr. Fabian is also liable in that, at his September 2017 deposition (again, after he was sued), he likewise attempted to posit that he was no longer paying himself the disputed 600K, as he was now “working” under his EA, having “changed his mind” at some indeterminate point in time .

90. At his deposition, he was unable to provide the date of his “change of mind”, nor was he able to provide specific details regarding the nature of the “work” he did - simply calling it “consulting.”

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91. Moreover, although there are THC meeting minutes ratifying the fraud, [Count I, ⁋133], there are no minutes memorializing Mr. Fabian’s “change of mind” regarding this 602K payroll scheme - because he never changed his mind.

92. For the foregoing reasons, Mr. Fabian is liable for fraudulent concealment.

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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COUNT XVI CIVIL CONSPIRACY

1. Plaintiff repeats the allegations contained in Counts I and XV of this Complaint and makes them a part hereof.

2. The defendants are collectively liable in the they agreed, along with defendant Fabian, to engage in the bank fraud, the payroll fraud, and the litigation fraud, with the aim of allowing Mr. Fabian to pay himself his disputed “off the books” indebtedness, under the guise that they were “saving” the company - as depicted inter alia by the June 27, 2013 “crisis” meeting.

3. They are further collectively liable, pursuant to Count XV, in that they conspired to “disappear” the Sun Bank Lawsuit of 2013, and they conspired to misrepresent the nature of Mr. Fabian’s payroll scheme.

4. They are further collectively liable, pursuant to Count XV, in that they conspired to prevent inter alia the deposition of company accountant Laurence W. Gold and other discovery.

5. Mr. Howard is liable in that he conspired, after the filing of plaintiff’s complaint in March of 2014, to create specious affidavits brazenly denying Mr. Fabian’s prior compelling admissions of payroll fraud. Mr. Howard conspired with Mr.

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Fabian, and others, to carry about this post-suit scheme, and is therefore further liable.

JURY DEMAND Pursuant to Rule 38 of the Federal Rules of Civil Procedure, Plaintiff demands a trial by jury in this action of all issues so triable. Respectfully submitted, April 5th, 2019 Rochelle Park, NJ /s/ Santos A. Perez, Esq. Santos A. Perez, Esq. The Perez Law Firm, LLC 151 W. Passaic St., Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

APP247

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Rochelle Park, NJ, 07662 (201)875-2266 sperez@gardenstatelaw.com Attorneys for Plaintiff

Applebaum v. Fabian et al, Complaint for Civil RICO Remedies:

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IN THE UNITED STATES DISTRICT COURT DISTRICT OF NEW JERSEY

Case No. 2:18-cv-11023-JLL-JAD

Edita Applebaum PLAINTIFF

Judge: Hon. Jose L. Linares V. William P. Fabian, Laurence W. Gold, Leah E. Capece

CERTIFICATION OF SANTOS A. PEREZ

& Efraim “Frank” Rajs, Cecilia Keh, Thomas D’Ambrosio, Maxine Melnick, & Michael Lackey, Gerald Macko, Derek Schumacher, Jimmy Samayoa, Garrett Applebaum , Youssef Abdulah Youssef, & Voya Financial, Inc., Intac Actuarial Services, Inc. & John Does 1-10, ABC Corp 1-10, et al. DEFENDANTS

I, Santos A. Perez, of full age, under oath, do state: 1. I am an attorney at law in New Jersey, in good standing, and I am fully familiar with the facts set forth herein. 2. Attached as “Exhibit A” is a true and accurate copy of an April 30, 2019 Order from the Superior Court, Chancery Division, Probate Part.

APP249

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3. The issue of the misappropriation of the late Todd Harris Applebaumâ&#x20AC;&#x2122;s 401K plan, of which plaintiff as the surviving spouse was the primary beneficiary, was raised in her moving papers and/or pleadings in State Court, and is not expressly referenced in this April 30, 2019 order.

I certify that the foregoing statements made by me are true. I am aware that if same are willfully false, I may be subject to punishment. __________________ Santos A. Perez, Esq. The Perez Law Firm 151 W. Passaic St., Rochelle Park, NJ, 07662 (201)875-2266 sperez@gardenstatelaw.com Attorneys for Plaintiff Dated: May 10, 2019

APP250

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APP251

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APP252

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APP253

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APP254

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APP255

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APP256

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APP257

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APP258

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UNITED STATES DISTRICT COURT DISTRICT OF NEW JERSEY

1 2 3

EDITA APPLEBAUM, Plaintiff,

4 5 6 7 8 9 10 11

vs. WILLIAM P. FABIAN, LAURENCE W. GOLD, LEAH E. CAPECE, EFRAIM “FRANK” RAJS, CECILIA KEH, THOMAS D’AMBROSIO, MAXINE MELNICK, MICHAEL LACKEY, GERALD MACKO, DEREK SCHUMACHER, JIMMY SAMAYOA, GARRETT APPLEBAUM, YOUSSEF ABDULAH YOUSSEF, VOYA FINANCIAL, INC., INTAC ACTUARIAL SERVICES, INC., ASCENSUS, LLC, SUSAN BAUER, JOHN DOES 1-10, and ABC CORP 1-10, et al.,

12 Defendants.

: : : : : : : : : : : : : : : : : : : :

Civil Action No. 2:18-cv-11023-KM-JAD

Newark, New Jersey Monday, August 12, 2019 10:01 a.m.

13 TRANSCRIPT OF MOTION HEARING BEFORE THE HONORABLE JOSEPH A. DICKSON UNITED STATES MAGISTRATE JUDGE

14 15 16

APPEARANCES:

For the Plaintiff:

The Perez Law Firm, LLC By: SANTOS A. PEREZ, ESQUIRE 151 W. Passaic Street, 2nd Floor Rochelle Park, NJ 07662

Transcription Company:

KLJ Transcription Service, LLC P.O. Box 8627 Saddle Brook, NJ 07663 (201)703-1670 www.kljtranscription.com info@kljtranscription.com

18 19 20 21 22 23 24 25

Proceedings recorded by electronic sound recording, transcript produced by transcription service.

APP259

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APPEARANCES (Cont.):

For Defendants William P. Fabian, Efraim (Frank) Rajs, Cecilia Keh, Thomas D’ambrosio, Maxine Melnick, Michael Lackey, Gerald Macko, Derek Schumacher, Jimmy Samayoa, Garrett Applebaum, and Youssef Abdulah Youssef:

3 4 5 6 7 8 9

Kluger Healy, LLC By: DAVID A. WARD, ESQUIRE 106 Apple Street, Suite 302 Tinton Falls, NJ 07724

10 11

For Defendant Leah Capece:

Morgan Melhuish Abrutyn By: JOSHUA A. HEINES, ESQUIRE 651 Old Mount Pleasant Avenue, Suite 200 Livingston, NJ 07039

12 13 14 15

For Defendant Laurence Gold:

Mandelbaum Salsburg, P.C. By: GERALDINE E. O’KANE, ESQUIRE 3 Becker Farm Road, Suite 105 Roseland, NJ 07068

16 17 18 19 20 21 22 23 24 25

APP260

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I N D E X

2 3

PLAINTIFFâ&#x20AC;&#x2122;S MOTION TO AMEND COMPLAINT:

Argument by Mr. Ward. . . . . . . . . . . . . . . . . .

Argument by Mr. Perez.. . . . . . . . . . . . . . . . . 31, 46

Colloquy re Additional Briefing.. . . . . . . . . . . . . . 43

7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

APP261

PAGE 5, 47

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Colloquy (Hearing commenced at 10:01 a.m.)

THE COURT:

2 3

All right.

This is the matter of

Applebaum versus Fabian, et al., Docket Number 18-11023.

May I have appearances of counsel, please?

MR. PEREZ:

Good morning, Judge.

May it please the

Court, Santos A. Perez on behalf of Edita Applebaum.

THE COURT:

MR. WARD:

Okay.

Thank you.

Good morning, Your Honor.

David Ward of

Kluger Healey, and we represent the defendants William Fabian,

Frank Rajs, Cecilia Keh, Thomas D’ambrosio, Maxine Melnick,

Michael Lackey, Gerald Macko, Derek Schumacher, Jimmy Samayoa,

Garrett Applebaum, and Youssef Youssef.

THE COURT:

MR. HEINES:

Okay. Good morning, Your Honor.

Joshua

Heines from the law firm of Morgan Melhuish Abrutyn on behalf

of defendant Leah Capece.

THE COURT:

MS. O’KANE:

Okay. Good morning, Your Honor.

Geraldine

O’Kane on behalf of Laurence Gold appearing for the firm of

Mandelbaum Salsburg.

THE COURT:

Okay.

All right.

Be seated, counsel.

This is a hearing on plaintiff’s motion to amend its

Thank you.

complaint.

We’ve received I think all of the filings.

reviewed the proposed amended complaint and then some other

APP262

I’ve

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Colloquy / Ward - Argument 1

homework. So, I want to hear about -- from each of the counsel

2 3

I’d like to get a record made as to why the complaint should

be amended and why it should not -- or why it should not be

amended. Let me set some ground rules first.

We are talking

I think essentially about humil -- I was going to say

humility.

we’re talking about futility and not -- so we’re -- it’s a

Rule 15 standard; is that correct, counsel for the defendants?

I guess we should always talk about humility.

MR. WARD:

THE COURT:

13 14

But

Yes, Your Honor. All right.

So we’re not really looking

at undue delay, are we? MR. WARD:

Your Honor, no, except to the extent

that, I mean, we do have statute of limitations arguments that

address the overall pleading, but I think that’s carved out

for another day.

THE COURT:

Okay.

Yeah, I would agree.

So then I think I may -- the burden is on the

plaintiff here, but let me start with the defendants.

why his amended -- proposed amended complaint is futile.

MR. WARD:

Yes, Your Honor.

Tell me

And just -- I want -- I

just to make the -- for the record, what I am referring to is

the proposed second amended complaint.

THE COURT:

Okay.

APP263

And that’s what at issue here.

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MR. WARD:

Yes, Your Honor.

THE COURT:

MR. WARD:

Okay. Just as a brief background, there was a

complaint filed and we had filed a motion to dismiss that

complaint.

THE COURT:

MR. WARD:

Right. Plaintiff then re-pled with the first

amended complaint and we filed a motion to dismiss the first

amended complaint.

plaintiff filed opposition papers, but also filed a proposed

second amended complaint.

it would be best if we addressed simply -- Iâ&#x20AC;&#x2122;ll say that word

loosely, simply -- the proposed second amended complaint and

then leave for another day to come back to Your Honor the

merits of the --

Then, in opposition to that motion,

THE COURT:

MR. WARD:

18 19 20 21 22

And Judge Linares determined that

Motion to dismiss. -- the motion to dismiss that we --

right. So, I just wanted -- so, I am just addressing today, Your Honor, -THE COURT:

And thatâ&#x20AC;&#x2122;s what I want you to address,

only for today, the new counts, --

MR. WARD:

THE COURT:

MR. WARD:

Yes, sir. -- the new parties. Yes, sir.

APP264

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Ward - Argument So that would be counts XII, XIII, XIV, XV and XVI

1 2

of the proposed second amended complaint --

THE COURT:

MR. WARD:

Mm-hmm. -- and whether or not the Court should

allow new parties in the terms of Thomas Howard, Kirsh -- I’m

sorry, I used to work Kirsch, Gartenberg and Howard

(indiscernible) -- Gartenberg Howard, Thomas Howard, and Morey

La Rue.

Those would be the --

THE COURT:

MR. WARD:

THE COURT:

MR. WARD:

I’m sorry, what was the third one? Morey, M-O-R-E-Y, La, L-A, -Right. -- capital R-U-E.

And I defer to Mr.

Perez, who has lived with these facts (indiscernible), but I

believe I (indiscernible) spelled that -- that right.

the entity that’s seeking to be added, as well.

That’s

And so, Your Honor, I understand the limits of what

we’re here for and I’ll try and be brief and attack our --

attack just those arguments that apply to these claims and

avoid for another -- and save for another day going into a lot

of the underlying arguments and (indiscernible) apply to the

RICO counts and the other counts.

But the reason why Your Honor should deny this

motion for second amended complaint and then allow us to come

back and argue on the motion to dismiss are simply threefold.

I understand that the plaintiff is -- I’ll use the term -- and

APP265

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Ward - Argument 1

I don’t mean this to be pejorative -- but it’s a little

unwieldy trying to discern, you know, according to the Rule 8

plain statement of facts, trying to discern what’s at issue in

each one, but I think, for purposes of this motion today,

three standards can eliminate all four -- five causes --

proposed causes of action.

standing, litigation privilege and probate exception.

And that would be the issues of

And with respect to those three, Your Honor, we can

8 9

go first -- and I think the argument on the request to add a

claim under the securities law, under Section 10(b)(5) for --

THE COURT:

MR. WARD:

Right. -- violation of the securities law and --

and trading, even though, you know, that’s a fairly discrete

claim, I think it can apply to the rest of the claims that are

being talked about here. And that is that plaintiff alleges that under

16 17

10(b)(5) she would have a cause of action for violation of a

law concerning disclosures in connection with sales of

securities.

estate is a seller under that statute.

what’s required for a transaction.

or not there has been anything like insider trading or fraud.

But most importantly, we could go into could we be harmed even

if.

we did an even if analysis, that’s where plaintiff’s argument

And we could go into argue whether or not the We could go into

We could go into whether

And I think, with respect to each of these arguments, if

APP266

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Ward - Argument 1 2

fails. THE COURT:

Could I ask a question?

Is it your

understanding that -- and plaintiff can correct all of us if

we -- if we’re -- if we don’t understand it.

understanding that the 10(b)(5) violation is in connection

with plain -- what plaintiff was paid out of the estate?

MR. WARD:

that that claims --

THE COURT:

MR. WARD:

Yes, Your Honor.

But is it your

It’s my understanding

Whether it was stock or cash? Would be -- yes, it would be in

connection with the -- the 10(b)(5) count came when, in the

estate litigation, the estate was arguing that it could

satisfy the distribution to the plaintiff by instead of an in

kind distribution of stock, --

THE COURT:

MR. WARD:

Right. -- it could satisfy it by purchase,

essentially, of stock by giving plaintiff the value of that

stock under the will.

THE COURT:

MR. WARD:

THE COURT:

MR. WARD:

Okay.

And that issue is being litigated in the

Appellate Division now in state court.

Right.

Okay. The lower court ruled that it could.

But

so the issue -THE COURT:

And is it their -- and is it further to

APP267

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Ward - Argument 1

your understanding the plaintiff’s case or allegation, that

the way that the estate or the executor of the estate or

somebody involved in administering the estate put facts in

front of the probate court that led to that result?

MR. WARD:

THE COURT:

MR. WARD:

Well, I -- as best I can make this out -Or is that --- my -- my understanding of the 10(b)(5)

argument was that it’s relying upon everything that precedes

the count XII, in terms -- and, you know, the other 211 --

THE COURT:

MR. WARD:

THE COURT:

MR. WARD:

Right. -- pages are fraud. Right. And that that fraud somehow -- well, that

fraud comes into the claim that in not giving me my shares and

not allowing me to be a shareholder, you have violated

10(b)(5), which relates to the requirements of a seller of

securities.

And again, like I said, we don’t -- I don’t think we

even have to get into whether or not these are subject to

10(b)(5) at all, --

THE COURT:

MR. WARD:

Because? Because if there is a harm here, that’s a

harm to either the estate or to the corporation.

a mere beneficiary of the estate.

the derivative nature of that claim is to the same in the

APP268

Plaintiff is

So, if there’s a harm and

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Ward - Argument 1

estate litigation as it would be even in the corporate

context.

opposed to a harm to the estate.

Plaintiff has to show a harm discrete to her, as

And here what her claim would be, would be -- I’m

4 5

guessing, because I have -- I’m trying to assess what that --

the nature of that harm would be, but it’s the -- it’s the

suggestion that by filing the motion in state court to have

plaintiff’s interest sold, as opposed to granted to her, that

that violates the securities rules. So now -- and as I said, Your Honor, so we have the

10 11

standing issue, the probate exception or the end-run

jurisdiction issue, you know, should this Court take control --

THE COURT:

MR. WARD:

Mm-hmm. -- of the issues that are being fought in

the state court and the litigation privilege issue.

three of those, in fact, come into play just on this one

count, and they apply to each one.

So, I will -- for example, Your Honor, --

THE COURT:

counsel.

May I ask you a question?

And all

I’m sorry,

Try to bear with me.

MR. WARD:

THE COURT:

Yes, sir. I’ve read your brief and I understand

the litigation privilege, I understand the probate exception.

Did you -- and I’m -- did you brief the standing issue?

MR. WARD:

I did, Your Honor.

APP269

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THE COURT:

MR. WARD:

Tell me what page. Sure.

It would be in connection with, I

think, Your Honor, -(Extended pause)

4 MR. WARD:

There’s two aspects of that.

We didn’t

breach the -- brief the claim -- the argument that any kind of

claims for tortious interference or -- or wrong related to an

anticipated inheritance is not available if there’s an

available remedy in the probate court, which is --

THE COURT:

MR. WARD:

THE COURT:

No, that I understand. But as to the -Whether this -- the whole standing issue

that if there --

MR. WARD:

THE COURT:

Yes. -- if there is a securities violation in

play here that the harm would be to the estate rather than to

the plaintiff in this case. MR. WARD:

Your Honor, I believe that argument that

we made on standing, to be fair, I don’t know that I made

that -THE COURT:

21 22 23

It might have been in the motion to

dismiss? MR. WARD:

-- in -- it might have been in the motion

to dismiss -- the motion to dismiss and instead repeated here

in our brief in connection with the argument on fraudulent

APP270

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concealment.

Let me just find that quickly, Your Honor.

Yes, Your Honor.

I’m sorry.

That was in connection

with the breach of fiduciary duty claims, fraudulent

concealment, aiding and abetting, and conspiracy claims at

point four of our brief, which is at pages 15 --

THE COURT:

MR. WARD:

-- and 16.

We addressed the argument

that I think is a little but more elaborated in our -THE COURT:

9 10

Right.

it.

Oh, yeah.

You know, I see it.

I see

I kind of -MR. WARD:

But in fairness, Your Honor, I don’t

believe I put that in the 10(b)(5) point, because we have --

not because, I should have, but it -THE COURT:

No, no.

I’m not complaining.

I just

want to -- you’ll see a method to my madness as we go along

here.

briefing.

seek briefing on.

back to it.

I may at the end of today seek a little bit of further And this is one of the issues that I’m going to So just make a note so if we have to come

All right.

MR. WARD:

Go ahead. Right.

I interrupted you.

And so the -- you know, so my

effort here, Your Honor, is to take something that I like --

that I find (indiscernible) and try and --

THE COURT:

MR. WARD:

That -- well, that’s what -- yeah. -- and crystallize, you know, the three --

APP271

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those three concepts. And I believe, Your Honor, that the standing

2 3

argument does apply equally to the 10(b)(5) issue, which is,

again, we’re talking about futility here.

to go forward on a 10(b)(5) claim, what would that claim be?

That claim would be that, in the administration of the estate,

the estate has been harmed because it’s not getting the full

value of shares because of all these issues that are brought

in.

If plaintiff were

For example, the Wells Fargo transaction, the Sun Bank --

THE COURT:

MR. WARD:

Sun Bank. -- transaction, all those issues.

Those

are issues that were -- that are going to cause harm to either

the estate or the trust, not the plaintiff.

show some specific injury.

And so she has to

And then, again, as we say in the 10(b)(5) context,

15 16

too, Your Honor, plaintiffs would have to show -- and I do

believe that would be more appropriate for the overall motion

to dismiss under, you know, Twombly and Iqbal and whether or

not there’s, you know, a possible claim, but as far as

futility, she had -- she can’t even show harm to herself. So that will be the 10(b)(5) standard, Your Honor.

21 22

And I think if we go to the next count, XIII, --

THE COURT:

MR. WARD:

duty.

All right. Right.

Breach of fiduciary duty.

And so that’s breach of fiduciary

And the difference here is there are -- the occurrence

APP272

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of that claim in the underlying complaint against Mr. Fabian

and others, and so the question --

THE COURT:

MR. WARD:

THE COURT:

MR. WARD:

THE COURT:

MR. WARD:

THE COURT:

MR. WARD:

THE COURT:

The original com -Okay. Yes, the -- the first -- the original

Right. Right.

Okay. The occurrence of that breach of

And counsel, I’m sorry for interrupting

you for a minute. (Discussion with clerk, off the record.)

THE COURT:

16 17

You mean the original complaint.

fiduciary duty claim in that context.

13 14

Yeah, I’m sorry.

complaint and the first amended --

Underlying complaint here?

Off -- we’ll -- there’s a couple of

other emergencies I’m juggling at the same time. (Discussion with clerk, off the record.)

18 19

THE COURT:

Just take us off the record.

THE CLERK:

You mean stop it?

THE COURT:

Yeah.

Okay?

No, go ask Tim.

Just go ask Tim.

Go ask Tim.

(Off record from 10:16 a.m. to 10:18 a.m.)

THE COURT:

All right.

interrupting you, but --

APP273

This is -- I keep

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MR. WARD:

All right.

That’s fine, Your Honor.

THE COURT:

MR. WARD:

So, Your Honor, I was going to turn then to the --

Proceed. Thank you.

and I was going to just do this in order, the thirteenth

count, the breach of --

THE COURT:

MR. WARD:

THE COURT:

MR. WARD:

Right. -- fiduciary duty. Yes.

Please do.

And there, there’s three new proposed

allegations that would support the amended count.

that Mr. Fabian’s attempts to disinherit plaintiff by selling

her 40 percent stake -- we just addressed that -- amounts to a

violation of fiduciary duty.

go to the -- I did address the standing argument, but also the

probate exception argument with respect to that.

issue that’s directly being teed up and actually it’s been

teed up and decided and now on appeal in the state court.

THE COURT:

MR. WARD:

21 22 23 24 25

And that is

And again, Your Honor, we -- I

That’s an

Okay. Whether or not -- whether or not that was

proper. The failure to distribute any monies from the estate is, again, in the state court proceeding, Your Honor. And then, defamation in -- in -- the claim here is that the -- the (indiscernible) statement would support a

APP274

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breach of fiduciary duty where Mr. Fabian, as the executor of

the estate, stated that plaintiff is acting out of anger when

she brought the action.

argument, the litigation privilege, and the probate exception.

Plaintiff (indiscernible) certainly would have a claim of

standing on defamation, --

THE COURT:

MR. WARD:

So, again, we have the standing

Mm-hmm. -- but again weâ&#x20AC;&#x2122;re talking about

statements that are made in the context of litigation which

afford the -- in New Jersey, the vastest --

THE COURT:

MR. WARD:

Right. -- protection, and so that claim would

not support a breach of fiduciary duty claim.

THE COURT:

MR. WARD:

Okay. And again, my understanding is that was

just addressed to Mr. Fabian and whether or not this should be

added as a new count in the already-existing --

THE COURT:

MR. WARD:

THE COURT:

Right.

Itâ&#x20AC;&#x2122;s a new --

-- (indiscernible) count from plaintiff. -- count on an old -- an existing

defendant.

MR. WARD:

THE COURT:

Yes, Your Honor.

And -- and --

And Mr. Fabian, I think, is a -- as, I

think the plaintiff calls him, a first tier defendant.

and the kind of the primary first putative --

APP275

And --

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MR. WARD:

THE COURT:

MR. WARD:

THE COURT:

MR. WARD:

Right. -- decides today. Right. The issue is, when we do the dismiss,

should we have to address this at all.

THE COURT:

MR. WARD:

Yes, and Mr. Fabian will be a defendant

no matter what Your Honor --

Right. And it will be futile, we submit, because

of those arguments that (inaudible, trails off dropping voice).

THE COURT:

MR. WARD:

I understand.

Okay.

And then, Your Honor, now with respect to

count XIV, which is a breach of fiduciary duty -- and this is

aiding and abetting.

Rajs, who is the president of Todd Harris Company, Laurence

Gold, who is the accountant, and Leah Capece, who is the

attorney, and suggests that those defendants -- and if Iâ&#x20AC;&#x2122;m not

mistaken, there is -- yeah and the -- well, let me deal with

those defendants first and then the other defendants that are

proposed to be added.

This adds prospective defendants Frank

Itâ&#x20AC;&#x2122;s that, again, that these defendants, in

connection with what they were doing back in 2013 and 2014,

aided Mr. Fabian in his breach of fiduciary duty.

24 25

So, I would defer the, you know, the substantive -you know, on the motion to dismiss the substantive argument at

APP276

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least under Bell, Twombly, and the analysis that we would have

for --

THE COURT:

Right.

MR. WARD:

I would just say here this is tied to -- the aiding

-- for a later day.

and abetting claim is tied to what we just talked about on a

breach of fiduciary duty claim, that there’s no breach of

fiduciary duty claim that can’t be an aiding and abetting

claim. With respect to the additional defendants that are

10 11

added here, which is Maxine Melnick, the claim there is she

notarized an affidavit that she knew would be submitted in

court.

issue.

The litigation exception comes in to address this

THE COURT:

And she -- when you say the additional,

she was -- she was an existing defendant.

proposed --

MR. WARD:

THE COURT:

MR. WARD:

THE COURT:

MR. WARD:

THE COURT:

MR. WARD:

She’s not under the

Right. -- second amended complaint. Right.

Correct.

Okay. I -- I’m sort of breaking those into -Okay.

Okay.

All right.

-- a tier where there’s an argument that

in -- I think there’s a clear linear distinction here between

APP277

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what’s litigation exception and what’s dismissible for other

reasons.

witness state facts that they believe to be true and submit an

affidavit can’t possibly be a claim for civil liability absent

malicious prosecution, which is not alleged here. So, we have these other claims, which is the, you

6 7

And I say that because, for example, having a

know, Maxine Melnick and the Thomas Howard argument -THE COURT:

If you could remind me, if you -- and

the plaintiff’s counsel can correct us or give us more

information on this when he gets up.

nothing but notarize affidavits? MR. WARD:

12 13

Maxine Melnick, she did

She notarized an affidavit which Ms. --

which plaintiff contends was false. THE COURT:

The -- yeah, I understand that he

contends the falsity of many of the affidavits, or several,

but she was a notary in somebody’s law office? MR. WARD:

17 18

Well, no.

She was a notary in

connection with the -- if I’m -- I don’t want to mislead --

THE COURT:

MR. WARD:

Yes.

employee.

Or the bank? With -- with the employment.

If I am correct.

MR. PEREZ:

MR. WARD:

She was an

Mr. Perez can correct me.

She is an employee. An employee of Todd Harris Company.

notarized an affidavit.

Again, she wasn’t saying I swear

these items are true, she’s saying this --

APP278

She

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THE COURT:

MR. WARD:

correct and they --

THE COURT:

MR. WARD:

THE COURT:

MR. WARD:

She notarized the signatures. -- the person came and their I.D. looks

Right. -- said that the above was true. Okay.

Thank you.

All right.

And then the additional

arguments are that Cecilia Keh and Thomas D’ambrosio are

liable for aiding and abetting, because they must have been

involved or been aware of the payroll fraud that’s been

alleged.

So, again, that argument, Your Honor, is if there

was payroll fraud, then you have (indiscernible), we have

standing litigation privilege, probate exception.

was payroll fraud, then the payroll fraud would have harmed

the Todd Harris Company, of which plaintiff is not even a

shareholder yet until the Appellate Division determines and

(indiscernible) be satisfied by a purchase or not.

is a shareholder, she’s got a problem, because isn’t that a

derivative claim?

THE COURT:

MR. WARD:

If there

And if she

Mm-hmm. It’s a derivative claim.

But again, so

we have to go through a couple steps to even get plaintiff in

the place where she can make that argument, and that’s why say

it’s futile to allow plaintiff to go down this road.

APP279

Let’s

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keep the complaint at the eleven and deal with the motion to

dismiss instead of adding the -- adding a claim that would be

futile to argue.

THE COURT:

MR. WARD:

Okay. And then the last defendant, as I say --

and I’ll address this a little bit more in detail next -- is

Mr. Howard, where plaintiff seeks to bring in another

attorney, that’s Mr. Howard, and his firm Gartenberg Howard,

claiming that they -- that, in the course of their obligation

seeking to filing motions and supporting certifications,

they’re simply liable, and then the case law is just so clear

on that.

They’re not.

THE COURT:

MR. WARD:

Mm-hmm. There are other remedies if Mr. Howard

made a false representation or his firm had made a submission

that was false, there are plenty of remedies.

the Rules of Professional Conduct, and the Rule 1:4, that

would be equivalent to our rules (indiscernible), Your Honor,

plenty of other remedies if that be the case.

even getting into the merits, it’s futile on that to proceed.

That we have

So, without

In count XV there’s a fraudulent concealment ultimate

-- and this one it lays out in some bullet points -- and then

we (indiscernible) now.

I think, again, I wanted to make sure that I was talking about

the right one.

This is the -- I just want to -- I --

It’s document file number 72.

APP280

Because there

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was an earlier proposed amended --

THE COURT:

MR. WARD:

THE COURT:

MR. WARD:

Right. -- complaint, but -- okay. Let’s refer to 72. Yes, sir.

So, at page 219 of document

72, it lays out a fraudulent concealment on bases of

spoliation and -- and there’s a table of contents for us

there, Your Honor.

the table of contents -- and then, you know, if we -- you

would turn to the arguments themselves, they all deal with Mr.

Howard’s involvement in the litigation.

the -- the argument is that he submitted certifications that

were false.

And in all respects, if we just look at

THE COURT:

MR. WARD:

When, for example,

Mm-hmm. And when he made a statement that a --

the Sun Bank lawsuit had not been filed, when in fact it had

been filed.

of litigation.

could have possibly been harmed by Mr. Howard saying that some

bank had prepared a lawsuit but not filed it and they -- a

lawsuit against Todd Harris Company.

started a lawsuit and Mr. Howard’s certification was that Sun

Bank had not, in fact, filed a lawsuit.

24 25

That was a statement what was made in the course And we don’t need to get into how plaintiff

That Sun Bank had

And what had happened actually is Mr. Howard -- and this is in plaintiff’s papers, so this is, you know,

APP281

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documented -- it’s document 58-4 of the docket.

had submitted a certification because he had earlier said Sun

Bank had filed a lawsuit.

sorry, PACER -- New Jersey Courts’ filing system to get a copy

of it and he saw there is no filed lawsuit.

a complaint, but it must have been -- you know,

(indiscernible) said we’re going to file a complaint, but

there’s no loss, so he wanted to correct the record, he

submitted his

Sun Bank had filed a lawsuit, I checked the electronic filing

system and the electronic filing system shows there was not a

lawsuit, in fact, filed.

the probate action.

MR. WARD:

THE COURT:

MR. WARD:

Then he checked PACER -- oh, I’m

Okay.

We’ve got

certification saying I previously stated that

THE COURT:

Mr. Howard

And he submitted this certification in

Yes, sir. Okay. Yes.

And that document 58-4 of our

court’s docket. And then it turns out that they had, in fact, filed

19 20

a lawsuit, it just didn’t show up on the electronic filing

system.

THE COURT:

MR. WARD:

Okay. So all of that is much ado about nothing,

mostly because it was filed in connection with litigation, but

also -- you know, and then we go back to with respect to the

APP282

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litigation privilege, that covers it, but then with respect to

standing, even if that’s so, whether Sun Bank had or had not

filed a lawsuit, the harm to Ms. Edita Applebaum is so far

removed that it doesn’t support a claim. So the futile arguments come into -- are futile.

5 6

don’t know if I’m always referring to (indiscernible) in the

middle of the day or not -- but the futile arguments, Your

Honor, come back into -- and we’ve got a probate exception

that applies, we have -- standing applies, and litigation

privilege.

is because if there is any merit to that claim and the

property, the property of the estate of Todd Harris, and

that’s being --

And the reason that the probate exception applies

THE COURT:

MR. WARD:

THE COURT:

MR. WARD:

That all comes back to the same thing. Same three things, Your Honor. I understand. And then, with respect to the sixteenth

count, Your Honor, that’s a civil conspiracy and it refers to

defendants being collectively liable for a civil conspiracy,

Your Honor.

defendants are, but if we assume that it’s the only ones that

are named here, it would be -- my understanding is that that

argument is that these defendants conspired with Fabian, so he

would be part of the conspiracy.

and Mr. Howard is named, I believe, with respect to the

And we’re -- we’d be left to guess who those

APP283

And Laurence Gold is named

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Ward - Argument 1

conspiracy. Charge.

in bank fraud, payroll fraud, litigation fraud, -THE COURT:

3 4

But again, that conspiracy is to engage

Let me do something that I wasn’t going

to do, but it may be able to help.

Mr. Perez?

MR. PEREZ:

Yes.

THE COURT:

As briefly as you can, is the civil

conspiracy fraud -- civil conspiracy count in 16, is it any

different than the conspiracy alleged up back in the RICO

counts?

MR. PEREZ:

It’s a state claim, Judge, and it will

be subject to litigation privilege, as opposed to

Noerr–Pennington doctrine, but the facts --

THE COURT:

No, forget that.

Is it the same facts

giving rise to the same damages, but it’s just pled as a civil

conspiracy, rather than RICO?

17 18

MR. PEREZ:

That’s what I’m asking.

The idea is that the civil conspiracy

would form a part of the RICO counts, yes.

THE COURT:

MR. WARD:

Okay.

Thank you.

Then with that -- thank you, Your Honor.

Because with that understanding, again, we would say much of

our argument for the RICO argument that we will make later,

but here, with the only new part being Mr. Howard, we --

THE COURT:

MR. WARD:

Right. -- would then go back to Mr. Howard’s

APP284

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Ward - Argument 1

role as pled in the complaint, is as a counsel in a state

litigation, there’s a probate exception and there is the

litigation exception again.

THE COURT:

MR. WARD:

Okay.

Go ahead.

And that rounds out the reasons why we

believe the motion should be denied, Your Honor. THE COURT:

Okay.

And then there were in the

proposed amended complaint -- I just want to make sure you and

I understand this the same before Mr. Perez corrects us or

agrees with us -- you’re entitled to agree.

and I’m looking at document ECF 72, paragraph -- we’re on page

things or just adding certain allegations.

Everything else after that is either a removal of certain

MR. WARD:

14 15

The rest of --

With one notable exception, Your Honor,

and that is I did not address Morey La Rue. THE COURT:

But the alle --

Well, before you get there though, is it

your understanding that paragraphs 6 through 9 are nothing

more -- well, actually, you said that it’s nothing more --

they’re not new counts, they’re not new claims, they’re not

new plain -- defendants, they are just additions or

subtractions to the factual allegations that had already been

pled.

MR. WARD:

THE COURT:

Six through nine of which of the -On page 3 of document 72.

outline, essentially, of the April 20 --

APP285

Which is the

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Ward - Argument 1

MR. WARD:

THE COURT:

MR. WARD:

THE COURT:

5 6 7

Oh yes, Your Honor. -- ‘19 amendments. Yes.

Right.

Mr. Perez, am I correct?

I can ask you

that question. MR. PEREZ:

Well, there are new predicate acts,

Judge, being --

THE COURT:

Well, right.

MR. PEREZ:

-- added.

THE COURT:

Right, but they’re new predicate --

they’re new --

MR. PEREZ:

Right.

THE COURT:

-- factual allegations that go to the

14 15

original pled -- originally pled counts. MR. PEREZ:

Correct?

Well, the facts are substantially the

same, except that I am incorporating a violation of 10(b)(5)

into the RICO predicate acts.

on standing, allows me to do, Judge.

Which Holmes, the seminal case

THE COURT:

Okay.

MR. PEREZ:

I’ll get into that when --

THE COURT:

Okay.

All right.

Fine.

that -- good.

Now talk to me about Morey La Rue.

MR. WARD:

That’s all

Morey La Rue, the claim there is that in

the sale of the Toben property -- and this is property that is

APP286

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Ward - Argument 1

property of the estate.

which is property that was owned by Mr. Applebaum --

THE COURT:

MR. WARD:

In the sale of the Toben property,

Mm-hmm. -- and another entity, Morey La Rue,

which was controlled by Mr. Fabian, that the sale of that

property was not at fair market value.

the property -- this property was fraudulent, because what it

did was, it allowed for the sale and Mr. Fabian to be paid

(indiscernible) that he (indiscernible) to the company.

And that the sale of

If that were the case, if the sale of the property

was fraudulent, and if Morey La Rue received monies

improperly, that would be a claim of the estate against --

THE COURT:

MR. WARD:

Right. -- Morey La Rue.

And if the claim is

that Morey La Rue shouldn’t have those monies, then the estate

should be suing Morey La Rue and retrieving those monies.

as Mr. Applebaum, as the executor, is making that decision,

that’s a decision that the probate court has teed up and

(indiscernible) -- I mean, we’re talking about prop -- this is

purely property of the estate.

THE COURT:

And

And that’s what I wanted to ask you.

this issue regarding whether or not that was -- that sale was

fraudulent to some degree, is that pending in the probate

court or was it decided as a result of the judge’s decision?

Is it -- is --

APP287

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Ward - Argument MR. WARD:

It was certainly an issue that was raised

as far as underlying litigation discovery and I -- I’m -- I’m

cautious here, Your Honor, because I don’t believe in the

probate court any substantive exceptions were filed to the

executor’s account.

THE COURT:

MR. WARD:

Regarding the sale or a lot of other

items.

THE COURT:

MR. WARD:

proceed, whether --

THE COURT:

MR. WARD:

Regarding the sale.

Okay. The issue was whether discovery should

Mm-hmm. -- Ms. Applebaum should be what they

called disinherited by the distributions, --

THE COURT:

MR. WARD:

Right. -- and there were -- there were years and

pleadings on all of these issues.

up, but I can’t stand here and say that the judge’s order,

which is in the docket --

THE COURT:

MR. WARD:

So it was certainly teed

Right. -- and if Your Honor is going to allow

for some, you know, some other additional short submission, I

would want to clarify that, because I don’t want to say that

that was addressed by Judge Bergman in his order.

extent I believe his order says, to the extent I haven’t

APP288

Or to the

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Perez - Argument 1

addressed it, I’ll (indiscernible) dismiss.

THE COURT:

MR. WARD:

THE COURT:

Okay.

All right.

Anything else?

That’s it, Your Honor. All right.

Counsel, do you have

anything to add or argue differently?

MR. HEINES:

Nothing to add, Your Honor.

MS. O’KANE:

Not I, Your Honor.

THE COURT:

Okay.

So, Mr. Perez, I think,

first of all, based on what you just said regarding the Holmes

case and 10(b)(5), I am going to want -- because I don’t think

you briefed that issue of standing.

MR. PEREZ:

I did, Judge, in my original brief.

THE COURT:

See, here’s the thing.

Let me make this

clear.

go back and read all kinds of other briefs that were filed in

support of different motions.

as chance to clear this up to the extent they need to.

you’ve briefed it somewhere else, don’t make me go look for

it.

complaint.

21 22

Whether it’s a fault of mine or not, I’m not going to

So I’m going to give everybody And if

Brief it in connection with the motion to amend the The standing issue. MR. PEREZ:

Okay?

Well, Judge, I -- in fact, I discussed

this with counsel prior to beginning today’s hearing --

THE COURT:

Okay.

MR. PEREZ:

-- whether we would get into the merits

of the proposed SAC or whether we would just argue whether or

APP289

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Perez - Argument 1

not the joinder is proper of the parties that I am proposing

to add and whether the amendment should be permitted in the

interest of justice. So, with that being said, Holmes is very

4 5

straightforward.

clear that she would have gone further than the majority and

she would have said an issue which -- which the majority did

not decide, that she would have said that in the context of a

10(b)(5) cause of action, Judge, a plaintiff need not allege

the standing requirements for a securities violation.

-- in a RICO lawsuit.

standing requirement in a RICO cause of action, Judge, is for

there to be proximate cause.

and --

15 16 17

In Holmes Justice O’Connor made it very

THE COURT:

The only requirement in a RICO --

So it’s fairly straightforward

Well, what you just said to me is that

she was in the dissent. MR. PEREZ:

And that’s not the law.

No, she wasn’t, and I think it was a

concurring.

circuit courts that have agreed with her.

biased and I agree with her as well, Judge.

And then there have been opinions in various

THE COURT:

agree with her?

Third Circuit.

24 25

She can

I certainly am

Well, I know, but does this circuit

That’s what I need to know.

MR. PEREZ:

This is the

This circuit has not decided that issue,

as far as I know.

APP290

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Perez - Argument THE COURT:

Well, then -- all right.

But here.

This is why I’m going to give you an opportunity to brief it.

Okay?

MR. PEREZ:

Sure.

THE COURT:

But keep in mind, I am not deciding --

you started off your argument by saying you discussed with

counsel before the hearing whether we’re going into the merits

of the claim or whether we’re talking about -- I can’t

remember how you phrased it.

What we’re talking about is whether or not your

proposed amendments are futile (few-till) -- futile (few-tile)

-- futile (few-dill), one of those pronunciations of that word

F-U-T-I-L-E -- under the law that governs amendments to

complaints in federal court.

15 16

So, count XII is a new 10(b)(5) count separate and apart from the RICO count.

Correct?

MR. PEREZ:

That is correct, Judge.

Yes.

THE COURT:

The defense has argued that your client

has no standing to assert that count.

further briefing from both you, Mr. Perez, and the defendants

on that issue.

that, just keep your arguments focused on whether or not she

has standing to assert a 10(b)(5) violation.

24 25

I am going to ask for

The standing on that count.

MR. PEREZ:

So when you argue

I’m ready to make that argument right

now, Judge.

APP291

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Perez - Argument 1

THE COURT:

I’m -- but I want it --

MR. PEREZ:

But I can re-brief it.

THE COURT:

-- I want it briefed.

want it briefed.

important issues here that we need to decide.

I want it -- I

I want a full record briefing on the really

Now, tell me why the probate exception does not bar

6 7

all of these new counts and especially bar the addition of

Thomas Howard as a defendant. MR. PEREZ:

As this Court is aware, Judge, the

Marshall case, the seminal case, basically essentially said

that unless it -- it somehow goes to the heart of the

administration of the estate, a claim, then it will not be

barred.

significantly.

basically along the lines of -- of a fiduciary committing

fraud.

exception, Judge.

It’s a -- it actually narrowed the probate exception And there is case law in my own brief, Judge,

And that would clearly not fall within the probate

But more importantly, we’re not probating a will.

There was, in fact -- Judge, and I’m -- if I’m doing a

comprehensive appeal, I think that brief is going to be the

most clearest statement of what happened to my client here.

But I think what’s been lost in translation here, one of the

more important acts that, if committed, that is clear fraud is

that they misappropriated her $100,000 401K plan.

THE COURT:

What --

APP292

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Perez - Argument 1

MR. PEREZ:

That has been lost.

THE COURT:

And where is that in -- I’m sorry.

Where is that pled in your complaint?

in the new counts.

complaint?

Is that -- that’s not

Is that -- or is that pled in your

MR. PEREZ:

That was originally pled, Judge, --

THE COURT:

Originally pled.

MR. PEREZ:

-- as part of a -- the RICO count.

THE COURT:

Under the RICO count.

MR. PEREZ:

Yes, and -- and I added --

THE COURT:

Well, is it a predicate fact or it’s an

Okay.

actual cause of action? MR. PEREZ:

The second -- the first amended

complaint, Judge, I added -- I believe I added some -- some

context and some more narrative as to that specific claim. THE COURT:

Well, I understand you’ve talked about

the facts of it, but what is the -- what count is that claim

in?

MR. PEREZ:

Counts V and VI.

THE COURT:

Okay.

MR. WARD:

There is a specific ERISA count that is

part of the first amended complaint, Your Honor.

THE COURT:

Okay.

All right.

Go ahead.

MR. PEREZ:

Well, Judge, as I was indicating to this

APP293

Thank you. So, --

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Perez - Argument 1

Court, one aspect of the fraud that is relatively

straightforward, that is indefensible -- they have not spoken

about this in the state court -- is the misappropriation of

the 401K.

were -- that were -- that whose claim settled relative to that

claim, but there’s still --

Now, there were two defendants in this case that

THE COURT:

Voya?

MR. PEREZ:

I’m sorry?

THE COURT:

Voya?

MR. PEREZ:

Correct.

THE COURT:

Okay.

MR. PEREZ:

Intac.

THE COURT:

It doesn’t matter, but I’m going to give

Correct.

Who is the other --

I remember Voya.

Who was the

other --

you some leeway here, but that’s not what I’m looking at

today, though; correct?

17 18

MR. PEREZ:

No, no, no, Judge.

If you want me to

get to the heart of my amendment, Judge, --

THE COURT:

Yes.

MR. PEREZ:

-- it’s count XV.

It’s count XV, Judge.

And the other claims, as this Court pointed out, the -- the

civil conspiracy and the aiding and abetting, that’s somewhat

part of the RICO claim already, but the addition of count XV

is the crux of my -- of my amendment, Judge, because of the

significant lapse of judgment, at the very least, by counsel

APP294

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Perez - Argument 1

for the executor. Now, this has been going on for quite some time.

2 3

Firstly, Judge, the submission of an employment agreement

dated 2010, which began in 2010, to argue that a -- a person,

that any person, a fiduciary or not, started to work under

that agreement in 2012 and paid themself a -- a payroll salary

pursuant to that agreement, it -- it basically, Judge, when --

when you look at the other facts -- mainly that the author of

that agreement, Paul Cavise, said that that agreement is

basically a fraud.

agreement.

I have no recollection -THE COURT:

12 13

He said I don’t remember drafting that

And for the record you’re talking about

Mr. Fabian being employed.

MR. PEREZ:

Mr. Fabian, prior to being sued, --

THE COURT:

Right.

MR. PEREZ:

-- because at the heart -- the -- the

economy is going to be center stage both in federal and state

litigation.

other defendants, but particular Mr. Fabian, on August of

2013, basically just said, look, I am paying myself $602,200

by putting myself on the payroll of the company.

big deal?

Prior to being sued, Judge, repeatedly he and the

What’s the

THE COURT:

Why is Mr. Howard liable for that?

MR. PEREZ:

Because but for his actions, Judge, we

would have prevailed.

There’s a fine line between zealous

APP295

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Perez - Argument 1

advocacy and fraud.

that was occurring, I was amending the complaint, Judge, and

it really -- there are a host of issues, because he is my -- I

am litigating this case with and I realize the -- how

significant the -- the -- what -- what it is what I am doing,

but there is absolutely no conceivable argument for him to

argue that that single certification targeting only -- and I

want to emphasize this -- one certification basically saying

the Sun Bank lawsuit was not filed.

Judge, the -- the Sun Bank lawsuit, as

Judge, that certification was superfluous, it was

not needed.

Sun Bank was not -- or the issue of Sun Bank was

not prominent at that stage of the -- in the litigation,

Judge, and he submitted that, and that certification made its

way over to the Appellate Division.

Judge, why is that --

THE COURT:

Where it’s pending now?

MR. PEREZ:

Where it’s pending now.

It -- there was

am interlocutory appeal which was denied.

THE COURT:

Okay.

MR. PEREZ:

By the Appellate Division.

Now, I looked for the record.

I happen to have

everything, all 100,000 documents, in digital format.

I can

search within seconds.

everything that I needed to prove that it’s not just that he

should have known that that lawsuit was filed, it’s that he,

in fact, knew.

So I found the -- the transcripts and

His own words are that in -- in -- on May 22nd

APP296

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Perez - Argument 1

of 2014 he basically uttered the words, well, this is a -- the

Sun Bank lawsuit almost caused the dissolution of THC and --

and had Mr. Fabian not taken the action that he did, we would

not be here.

how significant this lawsuit was.

So he realized from the very beginning ab initio

Fast forward, Judge.

Then we go to 2017.

I come

into the case, Judge Bergman comes into the case, a new judge,

the other judge retired, and -- and I serve a subpoena on the

counsel for Sun Bank and they respond.

did it of my own volition.

that subpoena on counsel for -- which is Hill Wallack, I

believe -- I made sure that the file will make its way over to

the chambers of Judge Bergman.

I -- I made sure -- I

I was not forced.

When I served

Now, How -- Mr. Howard was in receipt of

14 15

correspondence from Hill Wallack which contained the docket

number.

had the docket number, and his -- because we have the audio

that says -- we have the audio portion of that transcript, as

well.

His own words were that, well, that’s what the subpoena

said.

He’s not going to come here and say, oh, I was

referring to another subpoena.

transcript, you will see he was referring to the Sun Bank

counsel subpoena.

24 25

He was aware of the subpoena that I had served which

THE COURT:

Because if you read the entire

Mr. Perez, this is my question though.

You’re arguing why Mr. Howard engaged in wrongful conduct.

APP297

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Perez - Argument 1

MR. PEREZ:

Correct.

THE COURT:

What I want you to tell me is why the --

whatever the -- whatever conduct he engaged in, he’s not

protected by the litigation privilege.

MR. PEREZ:

Because it’s fraud, Judge.

THE COURT:

He did this in the context of litigation

where he was representing your client; correct? MR. PEREZ:

8 9

Well, in the context of the RICO claim,

because I do have a RICO claim --

THE COURT:

No, no, it -- but answer my --

MR. PEREZ:

-- he’s not protected, Judge.

12 13

fraud.

Not for

No. THE COURT:

You’re not -- answer my question.

conduct occurred while he was representing a client in

litigation.

His

Correct?

MR. PEREZ:

That’s absolutely correct.

THE COURT:

Okay.

MR. PEREZ:

Yes.

THE COURT:

So then I don’t think -- correct me if

I’m wrong, because there are a lot of papers here and I might

have missed something -- but I don’t think you have actually

briefed for me why the litigation privilege does not protect

Mr. Howard from being sued in this lawsuit.

MR. PEREZ:

No, Judge, because I was not --

THE COURT:

You’re just telling me it’s fraudulent,

APP298

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Perez - Argument 1

I get that, but that doesn’t really answer the question.

need to apply the privilege to his conduct in a brief and tell

me why the privilege does not protect him. MR. PEREZ:

I will do so, Judge.

You

Again, I would --

I was not aware that we would argue the merits of the -- of

the -- of the -THE COURT:

No, we’re not arguing the merits of his

conduct.

We’ll take the allegations as true for the purposes

of the motion.

Iqbal/Twombly, if there are allegations, we don’t measure the

allegations, we don’t -- we don’t judge whether they’re right

or wrong, we just see if they make out a cause of action.

right now you have made certain allegations about Mr. Howard

wrongfully putting in a certification that a lawsuit did or

did not exist.

himself at one point on the record and he corrected himself.

I mean, that’s -- you know, when we do

And

Apparently, that correction -- he corrected

Again, maybe -- and we -- and you have -- I’m not

17 18

asking you to tell me ultimately why that caused harm to your

client, I am asking you to tell me why, since he did in a

litigation, he filed a certification, tell me when the

litigation privilege ceases to exist for him.

thing.

That’s one

I want it briefed. And then the second thing is why the probate

exception doesn’t also protect him.

think you told me that the issue of his certification and Sun

APP299

Why these issues -- and I

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Perez - Argument 1

Bank is pending in front of the Appellate Division right now,

having been litigated in the probate court.

MR. PEREZ:

Yes, the appeal will be comprehensive.

THE COURT:

So tell me why that --

MR. PEREZ:

It’ll cover everything.

THE COURT:

-- doesn’t divest this Court of

jurisdiction.

They argue that it does and I want -- and

you’re going to give me a little more briefing on standing. MR. PEREZ:

Well, Judge, that’s very simple.

Marshall and -- in the Marshall litigation there was

concurrent --

THE COURT:

No, I don’t think it was very simple.

MR. PEREZ:

-- concurrent -- well, I -- I agree,

Judge.

Nothing in law is simple.

But the -- the quick answer

is that in Marshall there was concurrent litigation.

the litmus test is not whether the litigation is ongoing, the

litmus test is whether or not the -- the federal cause of

action somewhere interferes with the administration of the

estate.

argument in --

And that

That’s the litmus test and I am ready to make that

THE COURT:

All right.

MR. PEREZ:

-- this case, Judge, but more

importantly, Judge, I think what -- what this Court wants --

that maybe -- what may be lost in translation here is that

there are attorneys’ fees, as well.

APP300

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Perez - Argument / Colloquy Now, Mr. Howard -- it -- it -- it was revealed at a

1 2

colloquy in -- on December 14th of 2018 that the final

accounting contained some redactions.

Harris Company, is the only estate asset.

Now, THC, the Todd

THE COURT:

Mm-hmm.

MR. PEREZ:

It’s a profitable company.

It grosses

about $14 million dollars a year, Judge.

there were a number of advances from THC to the estate.

money went towards paying the attorneys’ fees for Mr. Howard.

Now, he’s paid himself close to a half a million dollars in

this case, Judge.

that litigation, because I was there and -- and I saw what --

how his -- his behavior --

though.

That

I can go on and on as to what he did during

THE COURT:

But that being said,

Well, here’s what you have to do,

You -- this is very --

MR. PEREZ:

Sure.

THE COURT:

And I want you to be careful about this,

MR. PEREZ:

Sure.

THE COURT:

You -- this is not a chance to start

Mr. Perez.

adding new allegations about Mr. Howard.

This is -- you’ve

pled what you’ve pled.

pled renders the litigation privilege null and void.

You have to tell me why what you have

MR. PEREZ:

Correct.

THE COURT:

That’s what you have to brief.

APP301

Okay?

That’s

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Colloquy 1

what I want to hear.

going to be a third amended com -- I am not suggesting you’ll

never have a chance to move to amend the complaint, but right

now that’s not the time.

proposed second amended complaint.

that issue for me.

We are looking at what we have.

The

And so I want you to brief

Now, it’s the same thing with the litigation

7 8

We’re not -- this is not -- it’s not

privilege.

With the --

MR. PEREZ:

Noerr-Pennington.

THE COURT:

-- probate.

MR. PEREZ:

Now, Judge, his conduct is also a part

12 13

of RICO, so should I brief the Noerr-Pennington as well? THE COURT:

I think so, yes.

Yes.

Okay.

So --

(Extended pause)

14 15

Yeah.

MR. PEREZ:

And just so this Court knows what my

thinking -- you know, what -- part of the reason why I did not

brief these points in my response, I believe, of a couple of

months ago, is that I would have assumed that at some point in

time Mr. Howard himself can come to court to argue those

points on his behalf.

THE COURT:

Well, he may.

MR. PEREZ:

He has no counsel now.

THE COURT:

He may, if I let -- if -- I have to make

the gatekeeper decision whether or not the claims against him

are futile because of the exceptions that the defendants have

APP302

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Colloquy 1

proposed.

Have argued. There may be other defenses he has and -- because

2 3

you’re getting into the merits -- and if I allow you to amend

your complaint to name him, then I am sure he will be filing a

motion to dismiss the way they will renew their motion to

dismiss.

MR. PEREZ:

Correct.

THE COURT:

Once we know what this proposed amended

complaint looks like. So, I am not suggesting that you won’t have another

10 11

bite at his apple, but I need to -- you need to do it one

thing at a time so that ultimately the record is clear for

Judge McNulty on the motions to dismiss what exactly is in

front of him.

Okay?

MR. PEREZ:

Certainly, Judge.

THE COURT:

Is there anything else?

What else do

you have?

Because, remember, we’re not arguing the merits of

the case.

I know you’ve got a lot to say about the case.

see that, I’ve read it, I get it, and it’s a big case.

the overriding question is why do you get to argue it here

while --

MR. PEREZ:

There’s an appeal pending, Judge.

THE COURT:

Exactly.

Okay?

Exactly.

But

And I know

there are exceptions, and I’m aware of that, but that’s why I

want it -- I want it just more closely briefed.

APP303

Okay?

And I

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Colloquy / Perez - Argument 1

wouldn’t mind if other defendants who have been riding on your

shirttails put it in your own briefs on exactly why this --

coattails, shirttails, whatever -- why your clients should be

let out of this, as well.

case, I’m sorry.

Why the new claims should not be allowed.

And maybe -- you know what?

6 7

Or at least -- not let out of this

Capece (ka-peesh) -- Capece (ka-peace)?

I think I see Ms. Cap --

MR. HEINES:

Capece (ka-peace).

THE COURT:

Capece is mentioned --

MR. PEREZ:

And just for the record, Judge, I mean,

she was more of an entire controversy defendant and the

equivalent to that in federal court on joinder, Judge.

believe she was a young attorney.

happening.

early on regarding the sale of the Toben property and the

December 9, 2012 minutes regarding the payroll fraud.

she just -- she wasn’t aware, Judge.

She had no idea what was

You know, there were some things that -- that --

I --

But there was -- that being said, there were some

things that should not have been done, which my client, the

widow of Todd Harris Applebaum, the mother of his three

children, she built the company from the ground up, she helped

him.

make sense.

Company, Judge.

plus she’s out six years in -- in -- in -- in benefits from

Now she has nothing but a $500,000 debt.

That doesn’t

She stood to own 55 percent of the Todd Harris Now she will own between 15 to 25 percent,

APP304

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Perez / Ward - Argument 1

the estate.

debt.

-- the fees.

She has not been paid one cent.

Plus she has a

And, in addition, she has paid two other attorneys her

This should not -- there -- there’s -- there’s

something amiss here, to say the least.

writing a comprehensive objective brief and I am putting a lot

of effort into that, and I expect the Appellate Division to,

at the very least, give me a plenary hearing.

something wrong here, Judge.

10 11 12

THE COURT:

I understand.

I expect -- I am

But there is

Let’s -- all right.

Let’s -- is there any more argument? MR. WARD:

No, Your Honor.

I understand that there

will be a re-submission.

are on the record, I would make two notes.

nowhere in the record that Mr. Capece [sic] said that any

employment agreement was a fraud.

to go into that analysis of the employment agreement, we would

go -- be going back into claims that are going to be decided

on the motion to dismiss.

THE COURT:

MR. WARD:

I just wanted to -- just because we That there was

And again, if we were going

Right. And with respect to the litigation

privilege, Your Honor, you know, that Loig -- the Loigman case

which was cited in our brief is clear and they say, you know,

we -- with respect to the privilege, it applies to any

statement made in litigation.

APP305

And they say we consider

Case 2:18-cv-11023-KM-JAD Document 89 Filed 08/27/19 Page 48 of 49 PageID: 1812 Ward - Argument

neither the justness or the lawyer’s motives nor the sincerity

of their communications.

that they are granted to the good and to the bad.

The trouble with privilege is, is

And the -- the privilege here with respect to Ms.

4 5

Capece, with respect to Mr. Fabian, with respect to Mr.

Howard, and on this motion it’s related to statements that

were made in the litigation, is if it’s a -- if it’s based on

a statement, a witness statement, anything made -- and that

privilege is going to cover anything made in the course of

that litigation, Your Honor. THE COURT:

I agree it’s a very strong privilege and

that’s why I want to give Mr. Perez the opportunity to fully

brief it.

Okay?

MR. PEREZ:

Sure, Your Honor.

THE COURT:

Now, let’s go off the record.

(Hearing adjourned at 10:57 a.m.)

* * * * * * * * * *

18 19 20 21 22 23 24 25

APP306

Case 2:18-cv-11023-KM-JAD Document 89 Filed 08/27/19 Page 49 of 49 PageID: 1813 49 C E R T I F I C A T I O N

1 2

I, TERRY L. DeMARCO, court-approved transcriber,

certify that the foregoing is a correct transcript from the

electronic sound recording of the proceedings in the above-

entitled matter recorded on August 12, 2019 from 10:01:16 a.m.

to 10:57:32 a.m.

7 8 9 10

S / Terry L. DeMarco

08/23/19 Date

Terry L. DeMarco, AD/T 566 KLJ Transcription Service

11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

APP307

Case 2:18-cv-11023-KM-JAD Document 90 Filed 09/20/19 Page 1 of 40 PageID: 1814

IN THE UNITED STATES DISTRICT COURT DISTRICT OF NEW JERSEY

Edita Applebaum PLAINTIFF

Case No. 2:18-cv-11023-KM-JAD

Judge: Hon. Kevin McNulty

2nd SUPPLEMENTAL BRIEF IN SUPPORT OF PLAINTIFF’S CROSS MOTION TO PERMIT THE FILING OF A SECOND AMENDED RICO COMPLAINT

DEFENDANTS

TABLE OF CONTENTS I.

INTRODUCTION................................................1

II.

Procedural Posture..............................................3

III.

FACTS......................................................3

I. INTRODUCTORY FACTS - “We Are Not Reporting Anything To Anyone At The End Of The Day..so I have to keep everything from me off the books” ..........................3 II.

BACKGROUND FACTS.......................................5

APP308

Case 2:18-cv-11023-KM-JAD Document 90 Filed 09/20/19 Page 2 of 40 PageID: 1815

III.

MISAPPROPRIATION OF 401(K) VALUED AT $100,000.00.......7

IV. THE SUN BANK FRAUD LAWSUIT of JUNE 25, 2013 AND THE CRISIS MEETING OF JUNE 27, 2013: CONSPIRACY TO COMMIT BANK FRAUD AND OTHER ADMISSIONS.......................7 V. $602,200.00 PAYROLL FRAUD AND SALARY RAISES BEGAN WITHIN HOURS OF DECEDENT’S PASSING...........................9 VI. FRAUDULENT “FIRESALE” OF PROFITABLE ONE-AND-A-HALF MILLION DOLLAR “TOBEN” COMMERCIAL PROPERTY FOR $800,000.00 TWO DAYS AFTER THE FILING OF PLAINTIFF’S COMPLAINT....................................11 VII. LITIGATION FRAUD AND BREACH OF FIDUCIARY DUTY BY THE EXECUTOR i.

Litigation Fraud and Breach of Fiduciary Duty in the Context of Frivolous Pleadings for In-Cash Distribution: The Purported Complete “Destruction” of a Multi-Million Dollar Company by A Disinherited Widow With Scant Financial Means..................13

ii.

Litigation Fraud, and Breach of Fiduciary Duty: Creation of New Evidence Ex Post Facto To Knowingly Conceal the Payroll Fraud (Spoliation)............15

iii.

Litigation Fraud and Breach of Fiduciary Duty: Knowing concealment of the Sun Bank Lawsuit of 2013 (Spoliation)................................17

IV.

Litigation Privilege Does Not Bar Claim Against Attorney for Litigation Fraud.......19

Noerr Pennington Sham Exception is Applicable as to the RICO Claim ..........24

VI.

Probate Exception Inapplicable Since this Case does not Interfere With Probate ....29

VII.

RICO Standing - O’Connor Concurrence and Proximate Cause ...............32

APP309

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TABLE OF AUTHORITIES ADP, LLC V. Ultimate Software Group, Inc, Civ. No. 16-8664, (March 5, 2018)......23, 24, 25, 26,27, 28, 29 ADP, LLC V. Ultimate Software Group, Inc, Civ. No. 16-8664 (KM) (MAH), (April 17, 2018) ................27 Bald Eagle Area School Dist. v. Keystone Financial, 189 F. 3d 321 (3rd Circuit 1999) .........................33, 34 Bridge v. Phoenix Bond & Indemnity Co., 553 U.S. 639, 656 (2008) .....................................21 Brokerage Concepts, Inc. v. US Healthcare, Inc., 140 F. 3d 494 (3rd Cir. 1998) ................................34 Chevron Corp. v. Donziger, 871 F. Supp. 2d 229 (SDNY 2012) ..............................21 Estate of Meriano v. C.I.R., 142 F.3d 651, 661 (3d Cir.1998) ..............................31 Giles v. Phelan, Hallinan & Schmieg, L.L.P., 2013 WL 2444036 (D.N.J. June 4, 2013) ...................22, 26 Giles v. Phelan, Hallinan 86 Schmieg, L.L.P., 901 F. Supp. 2d 509 (D.N.J. 2012) .......................21 Holmes v. Securities Investor Protection Corporation, 503 US 258 (1992) ............................................32 Kennedy-Jarvis v. Wells, 1 13 F. Supp. 3d 144 (D.C. 2015)...............................29 Marshall v. Lauriault, 372 F.3d 175, 180-82 (3d Cir.2004)............................31 Pufahl v. Parks' Estate, 299 U.S. 217, 226, (1936) ....................................31

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Rosenblit v. Zimmerman, 166 N.J. 391, 406-07 (2001) ..................................20 Three Keys Ltd. v. SR Utility Holding Co., 540 F. 3d 220, (3rd Cir 2008) .........................29, 30, 31 Williams v. BASF Catalysts LLC, 765 F.3d 306, 320-21 (3d Cir. 2014) ..........................20 Williams v. BASF Catalysts LLC, 2016 U.S. Dist. LEXIS 46273(D.N.J. Apr. 5, 2016)..............29

APP311

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BRIEF I.

Introduction Defendants,

having

effortlessly

pierced

the

litigation

privilege in state court to punish plaintiff for her lawsuits, as they readily admitted, infra, and having inexplicably succeeded in permanently disinheriting a widow who had lost millions of dollars since the passing of her husband, ECF #80, now seek to shield their brazen wrongdoing, which has enriched their own coffers by millions of dollars,

by invoking that same (litigation) privilege.

It is

respectfully submitted that such a systematic victimization of a widow, in plain sight, must soon meet its rightful remedy. At

hearing

August

12,

2019,

this

Honorable

Court

instructed the plaintiff to file (a second) supplemental brief regarding the issues of standing, the probate exception, litigation privilege, particularly

the

the Noerr Pennington doctrine, et al, relates

the

proposed

addition,

defendant, of the attorney for the executor in the underlying state court action, which has concluded (ECF #80), but is now on appeal. It is respectfully submitted, as set forth infra, that most of the relevant legal tenets are not â&#x20AC;&#x153;grayâ&#x20AC;? areas of law.

Instead,

they are settled doctrines which permit a tort lawsuit against a defendant who, by preponderance of the evidence or otherwise, knowingly committed the tort of spoliation, thus causing

the 1

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plaintiff great expense and untold additional financial hardships, which are in addition to the hardships visited upon the plaintiff by the defendants since the passing of her late husband in 2012. Further, as he is not being sued for defamation, defense counsel in the underlying state court action cannot avail himself of the protections of the litigation privilege.

Counsel is not

being sued for merely making derogatory comments about plaintiff, he is being sued instead for a wholly distinct and actionable actus reus,

wit,

knowingly

creating

altering

evidence

proximately caused plaintiff’s formidable damages.

which

Specifically,

counsel’s brazen post-suit litigation fraud obfuscated plaintiff’s pre-suit proofs of systematic common law and bank fraud committed by the defendants, thereby directly causing plaintiff’s permanent disinheritance on April 30, 2019, ECF #80, millions of dollars of loses she was entitled to as damages, as well as hundreds of thousands of dollars, or more, in attorneys fees which were paid or are owed. As a result of the systematic fraud, plaintiff was essentially left insolvent, potentially owing 500K in attorneys fees, as she struggles to raise decedent’s daughter who resides with her.

In fact, none of the three children beneficiaries have

received a distribution from the estate, in nearly seven years of estate administration, as a direct result of the defendant’s fraud, including proposed defendant Thomas S. Howard, Esq.

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II. Procedural Posture Plaintiff’s RICO complaint was filed on June 25, 2018 (ECF #1). On October 22, 2018, defendants demurred.

(ECF #27).

November 12, 2018, plaintiff responded by filing a first amended complaint.

(ECF #39).

After a series of administrative orders

and defendant’s second demurrer, the plaintiff on January 22, 2019 opposed same, and filed a cross motion for leave to file a second amended complaint, or “SAC”, (ECF #58, #59). On January 25, 2019, (ECF

#64),

defendant’s

this

Honorable

demurrer,

Court

administratively

terminated

pending resolution of plaintiff’s cross

motion for leave to file a SAC (SAC can be found at ECF #72). The within brief complements the briefs filed on January 22, 2019 (ECF #58), and on May 8, 2019 (ECF #78). III.

FACTS I. INTRODUCTORY FACTS The executor of the estate of the late Todd Harris Applebaum,

defendant William P. Fabian, a former

purported “off the books”

business partner of decedent, upon being sued for fraud by Sun National Bank on June 25, 2013, [SAC, Count I, ⁋21], promptly convened a “crisis” meeting, on June 27, 2013, [SAC, Count I, ⁋47], and in one breath uttered the entirety of the RICO scheme: We’re not reporting anything to anybody at the end of the day. I don’t know why I let you record this, but you better erase that part……... You know how Todd owes me all this money, right? If I put that on the corporate books, then Sun Bank 3

APP314

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[in 2010] would never have loaned us a dime or Wells Fargo. If I put that on the books now (in 2013), Wells Fargo won’t make the (commercial) loan. So I have to keep everything from me off the books, but if I drop dead, I expect my family to be paid. [SAC, Preliminary Statement, ⁋9].1 At a subsequent meeting in August of 2013, transcribed realtime by a court reporter, the executor then set forth the details of

$602,200.00

payroll

scheme.

[SAC,

Count

⁋137].

Specifically, he asserted without proofs that he and decedent had “agreed”2 that he would be repaid certain “off the books” debts through payroll payments on the payroll of the Todd Harris Company (“THC”)

which

would

continue

until

the

full

amount

“of

approximately $500,000.00” was paid off. [SAC, Count I, ⁋137]. One month later, he would sua sponte increase this amount to $602,200.00 by personally affixing that number on a sheet of paper, without independent proofs. [SAC, Count I, ⁋200-202]. The executor further admitted at the August meeting that defendants Gold and Rajs approved the payroll scheme, [SAC, Count I, ⁋137],

and that

the unprovable3 500K or 602K debt [SAC, Count I, ⁋200], was not on

Defendants Laurence W. Gold, CPA, and Frank Rajs, among others, were present at this “crisis” meeting. 1

The repeated use by defendants of a 2010 “employment agreement” [SAC, Count I, ⁋184], to justify the 2012 payroll fraud is a hoax and a fraud upon the Court. Statement of Facts, §VII(ii). 2

The only “proof” of this debt consists of an unsigned two-page handwritten document authored by Mr. Fabian himself. [SAC, Count I, ⁋200]. 3

APP315

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the books.4 Upon

[SAC, Count I, ⁋137]. being

sued

2014,

Mr.

Fabian

and

his

counsel

essentially posited that the foregoing proofs - including Mr. Fabian’s own admissions - were effectively an elaborate hoax by a disgruntled widow, in an ill-fated attempt to enrich her coffers by criminally fabricating false evidence. The State Court Judge readily agreed, and penalized her. II. BACKGROUND FACTS This matter stems from the passing of Todd Harris Applebaum on November 4, 2012 (“decedent”)[SAC, Count I, ⁋2].

Decedent died

“testate”, and in his purported last will and testament appointed his former “off the books” business partner, William P. Fabian, as executor. [SAC, Preliminary Statement, ⁋66].

Decedent was the

owner of numerous profitable assets including, but not limited to, a profitable multi-million dollar swimming-pool services company called the Todd Harris Company (“THC”) which grosses over ten million dollars annually. [SAC, Count I, ⁋3]. He was also 51% owner of a company called “Toben Investments” whose sole asset was a profitable commercial property

appraised at 1.5 million dollars,

[SAC, Preliminary Statement, ⁋40], which was sold for half of that

This payroll scheme is also evidenced by the minutes of a THC meeting of December 9, 2012, [SAC, Count I, ⁋132], a September 2013 notepad handwritten missive authored by Mr. Fabian, [SAC, Count I, ⁋202], and prior recorded admissions made by Mr. Fabian. 4

APP316

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amount two days after the filing of plaintiff’s lawsuit.

Ibid.

In his purported will, decedent bequeathed 60% of the THC shares to a testamentary trust, of which plaintiff and her three children were co-equal beneficiaries.5

Id.

In addition, he

bequeathed the entirety of the residuary of his estate to plaintiff only [SAC, Count I, ⁋16]. This was understood to mean at all times that plaintiff

would in fact inherit 40% of THC. [SAC, Count I,

⁋17],6, [SAC, Count IV, ⁋81, ⁋86], [SAC, Count XII, ⁋6]. Ergo, plaintiff was the non-controlling owner of 15% of THC through the testamentary trust, and a 40% direct owner, and as such she was and has been entitled to 55% of THC profits since November of 2012. However, she has received nothing to date, and on April 30, 2019 the State Court trial Judge in a draconian ruling denied her any and all relief, refused to permit the payment of her attorneys fees from the estate, and divested this widow of her 40% shares, for fear that she could, literally, “destroy” or “kill” the

To date, the testamentary trust has not been funded, and six years ex-post facto the only de facto beneficiaries of the estate have been the executor (Mr. Fabian), his attorneys and accountants, and defendant Rajs, who gave himself a 50K raise within hours of the passing of decedent. 5

The scrivener of decedent’s will, attorney Paul Cavise, at his deposition testified that decedent specifically engineered a 40%/60% testamentary scheme which would allow THC to subsist without interference by the minority shareholder. [SAC, Count I, ⁋17]. Cavise did not, however, testify that decedent upon signing the will intended to completely divest his wife of her 40% shares. Id. 6

APP317

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company.7 This ruling left the widow insolvent, with (potentially) 500K in outstanding attorneys fees, as she struggles to raise decedent’s daughter. III. MISAPPROPRIATION OF 401(K) VALUED AT $100,000.00 Defendants, fraudulently

within

months

misappropriated

the

passing

plaintiff’s

401K

decedent,

funds

worth

$100,000.00 [SAC, Count I, ⁋229] . This theft consisted of the transfer or “rolling over” of the 401K account into another account with a different financial institution, and then withdrawing the $100,000.00, without notifying the new financial institution that the funds were the property of plaintiff as decedent’s surviving spouse. Ibid. IV. THE SUN BANK FRAUD LAWSUIT of JUNE 25, 2013 AND THE CRISIS MEETING OF JUNE 27, 2013: CONSPIRACY TO COMMIT BANK FRAUD AND OTHER ADMISSIONS The Sun Bank fraud lawsuit was filed on June 25, 2013, and consisted of allegations of bank fraud, and forgery, exceeding $400,000.00.

[SAC, Count I, ⁋21]. This

fraud lawsuit against the

estate (and hence against Mr. Fabian as executor),

and against

The State Court Judge in his final April 30, 2019 ruling, ECF #80, explicitly denounced plaintiff’s lawsuits, and inhumanely stated he would have divested her of her shares for that reason, litigation privilege and defendant’s rampant fraud notwithstanding. However, he then adopted a clearly pretextual reason, to wit, that the admittedly solvent estate could sell the shares to satisfy its expenses. (ECF #80). 7

APP318

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the other defendants herein, served

bona-fide

is a material fact because:

catalyst

for

plaintiff’s

(i) it

comprehensive

whistleblower activities, infra, and (ii) a Wells Fargo banker at his deposition in 2018 testified that the knowing concealment of this lawsuit by accountant Mr. Gold, acting as agent of the executor per the Sun Bank “crisis” meeting [SAC, Count I, ⁋47], was a glaring material omission, i.e., that it “absolutely” would have made a difference if it had not been concealed from the bank. [SAC, Count I, ⁋110].

Mr. Gold, and Mr. Fabian’s counsel, in

late 2018, brazenly concealed the Sun Bank lawsuit from the state Superior and Appellate Courts, infra. As a result of this Sun Bank fraud lawsuit, Mr. Fabian convened the Sun Bank “crisis meeting” on June 27, 2013. [SAC, Count I, ⁋47]. In attendance were defendants Rajs, Gold, and others. Id. This meeting was characterized by brazen admissions of fraud, made in the heat of the moment, as defendants dramatically exclaimed that the liquidation of THC was imminent 8, and that criminal charges were possible. [SAC, Count I, ⁋56].

Mr. Fabian

at this meeting thus quipped, “we are not reporting anything to anyone at the end of the day” and “I have to keep everything from me off the books” [SAC, Preliminary Statement, ⁋9].

He also

“If we don’t do something today, by the end of the next week the Todd Harris Company will cease to exist.” [SAC, Count I, ⁋56] 8

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admitted that “they” committed bank fraud in 2010, by concealing from a

lender his “off the books” financials, Id, and he also

brazenly planned a conspiracy to commit bank fraud with the assistance

CPA

Laurence

Gold.

Id.

Plaintiff

refused

participate in the conspiracy, by refusing to sign a personal guarantee under false pretenses. [SAC, Count I, ⁋98].9

It was

rather clear from the context, that the executor’s sole concern were his payroll payments – not the beneficiaries of the estate. V. $602,200.00 PAYROLL FRAUD AND SALARY RAISES BEGAN WITHIN HOURS OF DECEDENT’S PASSING The

THC

payroll

fraud

consists

scheme

pay

unprovable debt to Mr. Fabian in the amount of 500K, [SAC, Count I, ⁋137], or 602K, [SAC, Count I, ⁋200-202],

via

fictitious 2K

weekly “salary” payments on the payroll of THC, which began within hours of the passing of decedent. [SAC, Count I, ⁋122].

The state

Court Judge at a hearing sua sponte characterized this debt as time-barred.

After he was sued by plaintiff, Mr. Fabian through

his counsel produced a poorly-drafted employment agreement (“EA”), [SAC, Count I, ⁋180], dating to 2010, and claimed that he was “earning” the payroll payments under this

2010 EA,

starting

Defendants then used plaintiff’s refusal to commit fraud to disparage and disinherit her, by falsely claiming that her reluctance to participate in the bank fraud could “destroy” the company.[SAC, Count I, ⁋98, ⁋318]. 9

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promptly upon the passing of decedent in late 2012.

He made these

false representations notwithstanding compelling pre-suit proofs that he was not working, notwithstanding compelling indicia of fraud within the EA itself, [SAC, Count I, ⁋193], notwithstanding that the purported author of the EA all but called it a fraud, [SAC, Count I, ⁋193],

See Statement of Facts, §VII(ii), and

notwithstanding that the EA says nothing regarding such a payroll scheme.

The repeated use of this EA by Mr. Fabian and his counsel

is, in fact, a hoax upon the honorable Courts. Plaintiff ’s formidable payroll scheme proofs include the December

2012

THC

board

meeting

minutes

which

explicitly

ratified the scheme, [SAC, Count I, ⁋132], the April 2013 THC board meeting wherein Mr. Fabian claimed he conspired with defendant Rajs, [SAC, Count I, ⁋136], the August 2013 meeting wherein Mr. Fabian set forth the scheme in detail - and implicated defendants Rajs10 and Gold, [SAC, Count I, ⁋137],

the September 2013 missive

in which Mr. Fabian asserted that the 602K debt would be reduced by his THC and Toben payroll payments from November 2012 to date, [SAC, Count I, ⁋202], the two page handwritten, unsigned document wherein Mr. Fabian essentially without proof asserted conclusively

In addition to participating in the payroll scheme per the admissions at the April 2013 and August 2013 meetings, defendant Rajs also gave himself a 50K raise within hours of the passing of decedent - with the executor’s approval. 10

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that he

was owed 602K, and not 500K, as he had claimed in August

of 2013, [SAC, Count I, ⁋200], and a certification dated 5/15/2014, in which he partially admitted the scheme.11 VI. FRAUDULENT “FIRESALE” OF PROFITABLE ONE-AND-A-HALF MILLION DOLLAR “TOBEN” COMMERCIAL PROPERTY FOR 800K TWO DAYS AFTER THE FILING OF plaintiff ’S COMPLAINT The Toben commercial property was owned 51% by the estate, and 49% by decedent’s son, by virtue of their respective ownership in

shell

company

Statement, ⁋40].

“Toben

Investments,Inc”.

[SAC,

Preliminary

It had recently been appraised at 1.5 million

dollars, and its annual income was circa 300K. Id., [SAC, Count I, ⁋5]. As the sole beneficiary of the residuary, plaintiff stood to inherit 51% of Toben, and hence the commercial property and its profits.

However, merely two days after plaintiff filed suit and

sought to stop the sale, defendants without court approval disposed of the property via a firesale, at half of the appraised value, [SAC, Count I, ⁋342, ⁋372, ], to the commercial tenants and former business partners of the executor. [SAC, Count I, ⁋389, ⁋401]. The sole beneficiary of this “firesale” was the executor, by virtue

Mr. Fabian’s 2014 certification falsely states that “consistent with my agreement with Todd, I will only receive payment until my loans and accrued consulting fees are paid in full.” This is a hoax upon the Honorable Courts. The only agreement he produced, [SAC, Count I, ⁋184], does not in any way provide for this arrangement. 11

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inter alia of his de facto ownership of Morey la Rue, which held a mortgage on the property. [SAC, Count I, ⁋377, ⁋357, ⁋362, ⁋388]. The Toben property was encumbered by a private mortgage owned by the previous owner of the property, “Morey La Rue Inc”, Ibid, which itself was a shell company de facto owned by Mr. Fabian.12 When the Toben property was sold, this mortgage was accelerated and paid in full - for the benefit of Mr. Fabian. [SAC, Count I, ⁋42, ⁋357].

In addition, shell company Toben “loaned” The Todd

Harris Company, “THC”, a portion of the proceeds of the sale,

and

THC then used this loan to accelerate and pay the “bailout” promissory note, owed Mr. Fabian in the amount of $350K. [SAC, Count I, ⁋487]. Mr. Fabian thus profited from the timed Toben firesale in at least two ways. The Toben company was also used as a shell company, as depicted inter alia by the “no show” salaries to Mr. Fabian, as well as to defendant Raj’s spouse. [SAC, Count I, ⁋357]. VII. LITIGATION FRAUD AND BREACH OF FIDUCIARY DUTY BY THE EXECUTOR The rampant litigation fraud in the case sub judice, which also constitutes a breach of fiduciary duty, consists of: (i) the frivolous use of outdated THC employee affidavits to disinherit

E.g, per the appraisal company, conveyance of the property to shell company Toben by shell company Morey La Rue was a “transfer of convenience”. [SAC, Count I, ⁋350]. 12

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plaintiff by requesting in-cash distribution of her 40% THC shares for, literally, fear that she can “destroy” or “kill” the company, [SAC, Count I, ⁋466], (ii) the creation by Mr. Fabian of ex-postfacto affidavits, prepared after he was sued, to knowingly conceal his own pre-suit admissions of the payroll fraud, [SAC, Count XV, ⁋22], and (iii) the brazen attempt by counsel for Mr. Fabian, as well as Mr. Gold (CPA), to “disappear” the pivotal Sun Bank lawsuit. In Mr. Fabian’s case, his counsel in an “exclusive” certification asserted, three times, that

the Sun Bank lawsuit

against the estate “was never filed”, [SAC, Count XV, ⁋28]. Gold similarly filed a certification,

Mr.

[SAC, Count XV, ⁋70],

claiming that he was unaware of this lawsuit despite compelling contrary evidence, infra. i. The Hoax of the Complete “Destruction” of a Multi-Million Dollar Company Mr. Fabian on January 7, 2015,

and then again in August of

2017 and October of 2018, in an effort to disinherit plaintiff, filed certifications signed in May of 2014, in which several THC employees in a faux pas claimed inter alia that plaintiff “stared” at one employee, that she was “digging for dirt”, and that she changed the truck gas receipts policy in an effort to combat fraud. [SAC, Count IV, ⁋59]. They thus essentially asserted that she was not

welcomed,

that

one

“liked”

her

one

attorney

once

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prominently quipped, because of her whistleblower activities13, and that if she were to physically remain on the premises as a THC employee, they would leave the company. Id.

In September of 2017,

Mr. Fabian at his deposition all but admitted that these outdated affidavits were no longer useful - as the “affiant employees” as of recent had no objections to her presence at the company. Further, as plaintiff had been fired by police escort in December of 2013, she had no physical presence at the company, [SAC, Count IV, ⁋22]. Nonetheless, and despite defendant’s repeated pre-suit

Plaintiff’s pre-litigation whistleblower activity is extensive. Specifically, hours after decedent died, and one month prior to probating decedent’s last will and testament, Mr. Fabian began his payroll fraud, and in addition increased defendant Rajs’ salary by $50,000.00. [SAC, Count I, ⁋18]. As a result, plaintiff began her whistleblower activity by inter alia consensually recording all meetings, starting in or about April of 2013. [SAC, Count I, ⁋136]. Sun National Bank on June 25, 2013 then filed a 400K fraud lawsuit against the estate (Mr. Fabian) and other defendants. [SAC, Count I, ⁋21]. The Sun Bank “crisis” meeting was held two days later, and was likewise recorded by plaintiff with Mr. Fabian’s consent. [SAC, Count I, ⁋47]. Then, in August of 2013 plaintiff confronted Mr. Fabian with her attorney and a court reporter, and demanded details regarding his payroll scheme, which he readily admitted adding that he sought to pay himself 500K. [SAC, Count I, ⁋137]. On September 4, 2013, he “increased” this amount to $602,200.00 dollars, and his “evidence” consisted of two unsigned handwritten sheets of paper. [SAC, Count I, ⁋200-202]. Shortly thereafter, in December of 2013, plaintiff was discharged from her husband’s company, and was escorted by the police. [SAC, Count IV, ⁋22-36]. Plaintiff then filed suit in late March 2014, and in or about May 2014 the THC employee-affiants executed faux pas affidavits in which they inter alia admitted whistleblower animus, e.g., that plaintiff was “digging for dirt”, [SAC Count IV, ⁋4858], Count I, ⁋427, ⁋89-⁋92, ⁋466]. 13

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promises to plaintiff that she would inherit her 40% shares, [SAC, Count IV, ⁋81], defendants brazenly filed the affidavits in late 2018, including Mr. Fabian’s own 2016 certification in which he disparaged plaintiff, [SAC, Count I, ⁋139, ⁋295],

to “support”

their far-fetched proposition that plaintiff could “destroy”

“kill” THC with her 40% non-controlling minority stake, and that she should therefore be divested of her minority interest in her late husband’s company.

[SAC, Count I, ⁋326].

The State Court

Judge, who called plaintiff’s proofs “useless” and “fake news”, adopted this far-fetched Orwellian novel14, and summarily divested her of her shares on April 30, 2019. (ECF #80). ii. Creation of Ex Post Facto Evidence To Knowingly Conceal the Payroll Fraud Mr. Fabian throughout the state court litigation knowingly sought to conceal his fraudulent payroll scheme by filing a series of ex post facto affidavits in which he essentially claimed that plaintiff’s pre-suit proofs of fraud were an elaborate hoax by an insolvent widowed disgruntled schoolteacher.

He was aided in this

illicit quest by “Exhibit 11”, a purported employment agreement (“EA”) which allegedly took effect in early 2010 and which lacks any modicum of business judgment. [SAC, Count XV, ⁋10]. Moreover,

Which also included claims by the executor that plaintiff had a propensity to file lawsuits generally. [SAC, Count IV, ⁋70] 14

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its purported author all but called this instrument fictitious, [SAC, Count I, ⁋194], and it contains compelling indicia of fraud within its four corners. Id.15

In his certifications, the executor

brazenly claimed that this 2010 agreement, [SAC, Count I, ⁋187], permitted

him

work

for

salary,

starting

promptly

upon

decedent’s death in 2012. [SAC, Count I, ⁋139]. This instrument, however, contains no such clause “approving” the payroll fraud. The repeated use of this EA is a hoax upon our honorable Courts. The compelling pre-suit proofs of the payroll scheme which the executor and his counsel knowingly sought to conceal with one stroke of the pen are further set forth at Statement of Facts, §V. Other proofs of the payroll scheme include the executor’s faux pas interrogatory answers, in which the executor mistakenly admitted that he did not engage in the payroll fraud in 2011 because of an IRS audit. [SAC, Count XV, ⁋18].16

Its purported author/scrivener - Paul Cavise, Esq. - did not remember drafting same, [SAC, Count I, ⁋192], the signatures appear forged, [SAC, Count I, ⁋198], and it contains clauses which no reasonable businessman would agree to (e.g. golden parachutes which would bankrupt THC). [SAC, Count I, ⁋181]. Moreover, the notary who notarized same has no records of the notarization, [SAC, Count I, ⁋195]. 15

Moreover, defendant’s attempt to deny the payroll scheme at his deposition backfired, as he admitted that he “changed his mind” regarding the scheme - although he was unable to say when he “changed” his mind. This constitutes a clear admission. [SAC, Count I, ⁋161]. 16

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iii. Knowing Concealment of Sun Bank Lawsuit Mr. Fabian’s state court counsel, Mr. Thomas Howard, Esq., in fact attempted to knowingly “disappear” the pivotal Sun Bank lawsuit

2013,

[SAC,

Count

XV],

filing

one

single

certification personally signed by him in late 2018, which had only one purpose - to

knowingly place on the record, three times,

the false “fact” that the Sun Bank fraud lawsuit against the estate was “never filed.” [SAC, Count XV, ⁋45].

This newly created and

demonstratively false “fact” was used to undermine and oppose plaintiff’s state court motion(s) for the removal of the executor, Mr. Fabian, for fraud.

Defendant CPA Gold likewise attempted to

deny the Sun Bank lawsuit - in his case he knowingly filed a certification opposing his and the executor’s removal for fraud, [SAC, Count XV, ⁋70], in which he falsely asserted that he was unaware of the Sun Bank lawsuit, in a clear attempt to undermine the

deposition

testimony

Wells

Fargo

executive,

who

characterized the omission of the Sun Bank lawsuit from a loan application

material,

unequivocally

testifying

that

“absolutely” would have made a difference if the Sun Bank lawsuit had been disclosed in connection with a commercial loan application in late 2013. [SAC, Count I, ⁋110].

This certification permitted

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Mr. Gold, and the executor17, to argue in State Court that neither of them should be removed for fraud, as plaintiff had sought. Proposed defendant Thomas S. Howard’s scienter is depicted inter alia by his dramatization at a May 22, 2014 hearing that the Sun

Bank lawsuit was catastrophic and nearly caused the

liquidation of THC. [SAC, Count XV, ⁋39]. aware,

having

attended

the

deposition,

Mr. Howard was also that

Wells

Fargo

executive in early 2018 in fact dramatically testified that it “absolutely” would have made a difference if Mr. Gold (acting as agent of the executor) would not have knowingly concealed the Sun Bank lawsuit from Wells Fargo in 2013. [SAC, Count XV, ⁋42]. Moreover, Mr. Howard’s own certified billing records submitted in State Court also depict his receipt and review of a “Sun Bank Counsel” subpoena and correspondence from Sun Bank’s attorneys, [SAC, Count XV, ⁋34-36], which prominently cited the docket number for the Sun Bank fraud lawsuit against the estate. Lastly, prior to plaintiff’s unsuccessful interlocutory appeal of late 2018, the executor’s counsel was also in receipt of a certification by plaintiff , in which she stated that a call placed to the Somerset

Mr. Fabian was the “mastermind” of this conspiracy to defraud Wells Fargo, per the June 27, 2013 Sun Bank “crisis” meeting, supra. 17

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Court in late 2018 confirmed that the Sun Bank lawsuit was “filed”. [SAC, Count XV, ⁋48].18 The

evidence

depicting

Mr.

Gold’s

scienter

equally

compelling, and includes Sun Bank bailout promissory note which he signed, [SAC, Count XV, ⁋77], his presence at the Sun Bank “crisis” meeting, [SAC, Count XV, ⁋76], and his own invoice, [SAC, Count XV, ⁋76].

IV.

Litigation Privilege Does Not Bar Claim Against Attorney for Litigation Fraud

[FRADULENT CONCEALMENT DEFINED]

The primary claims against Mr. Howard and Mr. Gold are fraudbased

claims

for

the

tort

spoliation

“fraudulent

concealment”,19 [SAC, Count XV], which were also referenced as

This did not stop counsel from knowingly relying on his spurious “never filed” certification in his opposition to the 2018 interlocutory appeal motion, which was denied, resulting in further damages to plaintiff. 18

19Count

XV of the SAC, ¶59-69, also sets forth a fraudulent concealment claim relative to Mr. Howard’s role in the retaliatory pleadings for in-cash distribution of plaintiff’s shares in her late husband’s multi-million dollar company. Statement of Facts, §VII(i). Essentially, the crux of this claim is that but-for the creation and filing of Mr. Fabian’s spurious affidavits, and particularly the employment agreement “hoax” and the false Orwellian claim by Mr. Fabian and Mr. Howard that Ms. Applebaum can literally “destroy” the company, plaintiff would not have lost her shares and/or incurred the expense of an appeal to recover them. See, e.g, [SAC, Count IV, ⁋70], (Mr. Thomas Howard, Esq. knowingly falsely asserted, without proofs, that plaintiff had a general propensity to file baseless minority shareholder lawsuits, which she has never filed.) Further, Mr. Howard filed the THC19

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corresponding RICO predicate acts. [SAC, Count I, ⁋336]. Per the 3rd Circuit’s interpretation of New Jersey law, to establish a claim for fraudulent concealment: A plaintiff must establish five elements: (1) The defendant had a legal obligation to disclose evidence in connection with an existing or pending litigation; (2) the evidence was material to the litigation; (3) the plaintiff could not reasonably have obtained access to the evidence from another source; (4) the defendant intentionally withheld, altered, or destroyed the evidence with purpose to disrupt the litigation; and (5) the plaintiff was damaged in the underlying action by having to rely on an evidential record that did not contain the evidence defendant concealed. Williams v. BASF Catalysts LLC, 765 F.3d 306, 320-21 (3d Cir. 2014) (citing Rosenblit (2001)).20

Zimmerman, 166

N.J.

391,

406-07

As to the reliance prong of this tort, the Third

employee affidavits, despite the executor’s own deposition testimony that they were essentially outdated, and useless. In doing so, he fraudulently concealed that the affiants no longer objected to plaintiff’s presence at the company. The motion Judge summarily relied on this misrepresentation, thereby causing plaintiff great harm and additional expenses. As a demurrer is not before this Honorable Court (since the SAC has not been filed), the plaintiff respectfully posits that the merits of the proposed SAC are rightfully the subject of another proceeding which will allow the plaintiff to thoroughly brief the tort of fraudulent concealment and its elements. Ergo, at the appropriate time, if applicable, the plaintiff will argue in a subsequent brief the doctrine of third party reliance, insofar as the State Court Judge in late 2018 sua sponte invoked and relied upon Mr. Fabian’s post-suit certifications, prepared by Mr. Howard, in which Mr. Fabian with one stroke of the pen sought to conceal the entirety of his payroll scheme. The motion Judge also relied upon Mr. Howard’s spurious Sun Bank certification in denying removal of the executor – since Mr. Howard’s certifications clearly sought to obfuscate one of the reasons sought for removal, to wit, that Mr. Fabian and Mr. Gold knowingly concealed the Sun Bank lawsuit from a commercial lender. [continued next page..] 20

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Circuit

further

asserted

that

“[t]he tort does not require

reliance on an adversary's representations. Indeed, a lawyer … who destroys or conceals evidence may be liable even if he ... makes no representations to his ... adversaries at all.” Williams v BASF, 756 F3d at 323. In Rosenblit, cited by the Third Circuit in Williams supra, the Court noted that other jurisdictions have seemingly dispensed with the “reliance” prong of this tort: [Other] jurisdictions have set forth the elements of the tort as follows: (1) the existence of pending or probable litigation involving the plaintiff; (2) defendant's knowledge of the pendency or fact of the litigation; (3) intentional destruction of evidence by the defendant designed to disrupt the plaintiff's case; (4) disruption of the plaintiff's case; and (5) damages proximately caused by the defendant's acts.[citation omitted]. Rosenblit, 166 N.J. at 398. [LITIGATION PRIVILEGE DOES NOT BAR FRAUDULENT CONCEALMENT CLAIMS] In Giles v. Phelan, Hallinan 86

Schmieg,

L.L.P.,

901

[Footnote 20, continued]: Lastly, the appellate division, in denying plaintiff’s 1000-page motion for leave to file interlocutory appeal, may have also relied on Mr. Howard’s certification. See, e.g., Bridge v. Phoenix Bond & Indemnity Co., 553 U.S. 639, 656 (2008). (a RICO plaintiff can be directly injured by a misrepresentation even where "a third party, and not the plaintiff, ... relied on it”.) (emphasis supplied). See also Chevron Corp. v. Donziger, 871 F. Supp. 2d 229 (SDNY 2012) (finding third party reliance in the context of a RICO suit against a Harvard-educated attorney in connection with his rampant litigation fraud). 21

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Supp.

509

Honorable Court

(D.N.J.

2012)

(hereinafter

“Giles

1), this

found that the litigation privilege protects

communications – which is unlike the actus reus of spoliation: The privilege has four elements. It applies to "any communication (1) made in judicial or quasi-judicial proceedings; (2) by litigants or other participants authorized by law; (3) to achieve the objects of the litigation; and (4) that have some connection or logical relation to the action." (citation omitted). Id. (emphasis supplied). Two years after Giles 1, in Williams v. BASF supra, the Third Circuit unsurprisingly then found that the litigation privilege does not bar the actus reus of spoliation. Williams v. BASF, 756 F3d at 318. (“But New Jersey's Supreme Court has never recognized the litigation privilege to immunize systematic fraud, let alone fraud calculated to thwart the judicial process.”). In

addition, in

Schmieg, L.L.P.,

“Giles 2”,

Giles v. Phelan, Hallinan &

2013 WL 2444036

(D.N.J. June 4, 2013) this

Honorable Court also held that the litigation privilege does not bar RICO actions, such as the one asserted against Mr. Howard and Mr. Gold for their fraudulent concealment of the payroll fraud and the Sun Bank lawsuit. [SAC, Count XV]. This Honorable Court in March of 2018 offered further guidance as to the limitations of this privilege, by explicitly delineating 22

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yet another exception, to wit, that the litigation privilege does not cover litigation that is pretextual.

ADP, LLC V. Ultimate

Software Group, Inc, Civ. No. 16-8664 (KM) (MAH), (March 5, 2018) (finding – pending a hearing or trial - that the purpose of ADP’s litigation may have been to create a “cloud of fear” in order to obtain a competitive advantage with USG.) In the case at bar, plaintiff-widow lost her shares in her late husband’s company because of the retaliatory inhumane pleadings to disinherit her, Statement of Facts, §VII(i), supra, and as set forth by the plaintiff said retaliatory pleadings had only one goal – to instill a “cloud of fear” over the plaintiff-widow to prevent her whistleblower activity, footnote 13, which includes her bona fide lawsuits.21

It should surprise no unbiased fact-finder that defendant in late 2018, having been put on notice of a federal suit filed in June of 2018 which contained explicit claims for the retaliatory pleadings to disinherit plaintiff, decided to go “all the way” with the pleadings to permanently disinherit plaintiff, in order to sabotage this ”pre-text” exception to the litigation privilege. To be sure, as stated supra, the Judge did disinherit plaintiff (ECF #80) – based upon the pretext of the insolvency of the estate, despite repeated assertions by the defendants themselves that the estate, which subsisted on the very profitable THC company, was in fact solvent. The State Court trial Judge, however, did not pass on the opportunity to warn plaintiff about using the Courts to seek redress, as he explicitly denounced her litigation, which is in fact protected by the litigation privilege. (ECF #80). Moreover, other than the “fake news” and “useless” utterances by the State Court Judge, supra, there has been no explicit finding that plaintiff’s state or federal litigation is vexatious and warrants relief – other than the permanent disinheritance inhumanely ordered by the Judge. 21

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Noerr Pennington Sham Exception is Applicable as to the RICO Claim [NOERR PENNINGTON DOCTRINE DEFINED]

In ADP, LLC V. Ultimate Software Group, Inc, Civ. No. 16-8664 (KM) (MAH), (March 5, 2018), this Honorable Court, Judge McNulty, defined the Noerr Pennington doctrine: Rooted in the First Amendment and fears about the threat of chilling political speech," the Noerr-Pennington doctrine provides immunity from antitrust liability for parties who petition the government for redress [citations omitted]. The doctrine extends to "actions which might otherwise violate the Sherman Act because `[t]he federal antitrust laws do not regulate conduct of private individuals in seeking anticompetitive action from the government." Id…. NoerrPennington has been extended to provide immunity to private efforts to influence courts and agencies, whether federal or state, [citations omitted] and has been held to shield plaintiffs from liability for pursuing state common law claims such as tortious interference with contract and tortious interference with prospective economic gain. [citations omitted]. Id.

[SHAM EXCEPTION TO NOERR PENNINGTON PRIVILEGE]

This

Honorable

Court

that

opinion

then

defined

the

sham

exception to this privilege: However, Noerr-Pennington is not an absolute shield that covers all litigation and petitioning activity. Hanover 3201 Realty, LLC v. Village Supermarkets, Inc., 806 F.3d 162, 178 (3d Cir. 2015). The immunity ends where the litigation "is a mere sham to cover what is actually nothing more than an attempt to interfere directly with the business relationships of a competitor and the application of the Sherman Act would be justified." …. In analyzing litigation to determine if the actions are a sham, the Third Circuit has adopted the approach that governs in the Second, Fourth, and Ninth Circuits …First, 24

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the court must determine whether there has been a single filing or a series of filings. Id. If there has been a single filing, there must be "a showing of objective baselessness before looking into the subjective motivations" of the party … On the other hand, when faced with a "series or pattern of lawsuits," a more flexible approach is warranted. Id. Even if some of the petitions turn out to have objective merit, the claimant is not automatically immunized from liability. Id. … The court is expected to perform a more holistic review that may include looking at the filing success of the claimant, evidence of bad faith, and the magnitude and nature of the collateral harm caused by the filings as circumstantial evidence of the subjective motivations of the petitioner. …. If more than an insignificant number of filings have objective merit, then it is unlikely that they were filed without regard to success.… On the other hand, a high percentage of meritless or objectively baseless proceedings can support a finding that the filings were not brought to redress any actual grievances... ADP, LLC V. Ultimate Software Group, Inc, Civ. No. 16-8664 (KM) (MAH), (March 5, 2018).

[SHAM EXCEPTION IN THE CONTEXT OF RICO ACTIONS]

This Court in Giles 2, supra, set forth two relevant propositions: was

applicable

(i) Noerr-Pennington’s sham litigation exception in

RICO

actions

and

(ii)

even

the

“sham

litigation” is successful, i.e. if defendants prevail as they did in the within case22 (pending an appeal),

this “victory” does not

foreclose an independent and objective (fact) finding in another forum that the litigation was nonetheless a sham, as discussed infra.

To be sure, defendant’s “victory” involved little to no fact finding, as there were no plenary hearings whatsoever, despite plaintiff’s repeated requests for same. 22

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Giles 2 further

set forth the general requirements for the

sham litigation exception, to wit, “the lawsuit must be objectively baseless

the

sense

that

reasonable

litigant

could

realistically expect success on the merits …[and] the litigant's subjective

motivation

must

conceal

attempt

interfere

directly with the business relationships of a competitor . . . through the use [of] the governmental process—as opposed to the outcome of that process….To fall within this exception, a lawsuit "must be a sham both objectively and subjectively”. Giles v. Phelan, Hallinan & Schmieg, L.L.P.,

2013 WL 2444036

(D.N.J. June

4, 2013) (“Giles 2”). (emphasis supplied). [SHAM EXCEPTION OBJECTIVE STANDARD: A “VICTORY” BY THE SHAM LITIGATORS DOES NOT FORECLOSE FURTHER FACT FINDING AND A DETERMINATION THAT THE LITIGATION WAS NONETHELESS A SHAM]

In Giles 2, supra, this Honorable Court found that the Noerr Pennington doctrine’s sham exception was limited – in that a “victory” by the defendants in the subject “sham” litigation did not foreclose a finding that the litigation was nonetheless a “sham”, to wit,

“[t]o be clear, the Court is not holding that any

favorable disposition in prior court proceedings guarantees that the Noerr-Pennington doctrine will apply”. Id. at 5. As of recent, in ADP, LLC V. Ultimate Software Group, Inc, Civ. No. 16-8664 (KM) (MAH), (March 5, 2018), this Honorable Court, Judge McNulty, further reiterated this holding, to wit, “[e]ven if some of the petitions turn out to have objective merit, the 26

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claimant is not automatically immunized from liability”. Id. In that same case, and then again on reconsideration, ADP, LLC V. Ultimate Software Group, Inc, Civ. No. 16-8664 (KM) (MAH), (April 17, 2018), this Court, Honorable Judge McNulty, further found that application of the exception was fact-sensitive, and may require further fact-finding despite a “victory” by the purported sham litigators: ADP's second contention is that the standard for "sham litigation" has not been met … because the lawsuits actually litigated … were not "objectively baseless" or brought "without regard to the merits." … Describing a series of cases where the non-compete agreements were litigated, ADP touts a won-lost[4] record of 12-1… USG disputes the reading of these cases as victories for ADP, while also pointing out that there is still a factual controversy as to whether the first prong of Professional Real Estate ("objectively baseless") has been met. … At the motion-to-dismiss stage and without the benefit of discovery definitively setting out the universe of cases between ADP, USG, and its employees, it is too early to decide whether the series of litigations pursued by ADP against USG and its employees constitute "sham litigation." ADP, LLC V. Ultimate Software Group, Inc, Civ. No. 16-8664 (KM) (MAH), (March 5, 2018). This Honorable Court, at footnote 6, then cited case law in support of the proposition that “the question of whether litigation is a sham can be a fact question for the jury.” Id. at 6 n.3. [APPLICATION OF NOERR PENNINGTON CASE SUB JUDICE]

In the case sub judice, the following three acts are alleged as

RICO

predicate

acts,

(i)

the

retaliatory

pleadings

disinherit, which are based on fraudulent misrepresentations and

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fraudulent concealment, [SAC, Count I, ⁋336], Statement of Facts, §VII(i),

(ii) fraudulent concealment of the Sun Bank lawsuit by

Mr. Gold and Mr. Fabian’s counsel, [SAC, Count I, ⁋336], Statement of Facts, §VII(iii), and (iii) fraudulent concealment of the payroll fraud, [SAC, Count I, ⁋336], Statement of Facts, §VII(ii). As

stated

supra,

the

SLAPP-type

pleadings

disinherit

plaintiff had as a motive instilling a “cloud of fear” upon plaintiff, in order to prevent her comprehensive whistleblower activity and force her to settle the within case. this shenanigan simply thus sought leverage. regarding

these

retaliatory

pleadings,

Defendants with

As such, the claims

[SAC,

Count

⁋336],

clearly fall within the pretext exception as set forth by the Honorable Judge McNulty supra since, simply, it is impossible for plaintiff to “destroy” any company with a 40% interest. ADP, LLC V. Ultimate Software Group, Inc, Civ. No. 16-8664, (March 5, 2018). The Sun Bank cover-up predicate act, Statement of Facts, §VII(iii),

as well as the payroll fraud cover-up predicate act,

Statement of Facts, §VII(ii),

are not immunized by the Noerr

Pennington doctrine because of a proposition which may be of first impression

nefarious

acts

the

federal

constitute

courts, a

wit,

“petition”,

neither they

were

these merely

defensive in nature and did not involve a counterclaim or counterpleading or motion by defendants.

such, there is no need to

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invoke the “sham” exception, since Noerr Pennington does not immunize these brazen acts of fraud to begin with. See, e.g, ADP, LLC V. Ultimate Software Group, Inc, Civ. No. 16-8664 (KM) (MAH), (March 5, 2018)

(“the Noerr-Pennington doctrine provides immunity

from ... liability for parties who petition the government for redress.”) (emphasis supplied). See also, Williams v. BASF Catalysts LLC, 2016 U.S. Dist. LEXIS 46273(D.N.J. Apr. 5, 2016), complaint

alleges[defendants]

engineered

the

false

(“Here, the

statements

and

evidence in advance of litigation. ..They rigged the game from the beginning. . . . According to the complaint, [defendants] were not mischaracterizing the facts; they were creating them.”)

VI.

Probate Exception Inapplicable Since this Case does not Interfere With Probate

In Three Keys Ltd. v. SR Utility Holding Co., 540 F. 3d 220, (3rd Cir 2008), the 3rd Circuit set forth the limitations of the probate exception as decreed by the Supreme Court two years earlier in the seminal Marshall case: It is clear after Marshall that unless a federal court is endeavoring to (1) probate or annul a will, (2) administer a decedent's estate, or (3) assume in rem jurisdiction over property that is in the custody of the probate court, the probate exception does not apply. Id at 227. Courts

(emphasis supplied). have

thus

rightfully

permitted

fraudulent

misrepresentation claims, such as those in the case at bar, based on said limitations to the probate exception.

For instance, in 29

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Kennedy-Jarvis v. Wells, 113 F. Supp. 3d 144

(D.C. 2015),

a case

which had been stagnant in the New Jersey Probate Court for six years, the Court found that: [t]he probate exception can no longer be used to dismiss `widely recognized torts' such as breach of fiduciary duty or fraudulent misrepresentation merely because the issues intertwine with claims proceeding in state court." … Id. (emphasis supplied). [PROBATE EXCEPTION ANALYSIS]

Three Keys LTD, supra, involved a transfer of shares which at first

glance

seems

similar

the

(draconian)

transfer

(insolvent) plaintiff’s THC shares in the case at bar.

However,

Three Keys LTD essentially involved a declaratory action, by the recipient of the shares, that they were the rightful owners of same. Three Keys Ltd., 540 F. 3d at 229. (“count Two of Three Keys' complaint, labeled ‘Declaratory Judgment,’ .... seeks a federal court

determination

Three

Keys'

ownership

interest

Utility.”).

The Three Keys LTD court also characterized the

transfer

Three

Keys

LTD

(declaratory

judgment

plaintiff), as essentially an “interested” transaction, i.e., not one based on systematic fraud such as in the case at bar, and then held that the probate exception temporarily applied until the probate court rendered final judgment on the legality of the transfer and relinquished jurisdiction over the estate and its assets by closing the estate or otherwise: 30

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Nevertheless, Basciano purported to sell 24% of the SR Utility shares to Three Keys, without acquiring Orphans' Court approval. We must determine whether this interested transaction somehow removed the shares from the exclusive jurisdiction of the Orphans' Court. We conclude that it did not. We have held that "the estate maintain[s] a proprietary interest in any distributions prior to the Orphans' Court's approval." Estate of Meriano v. C.I.R., 142 F.3d 651, 661 (3d Cir.1998). To our knowledge, the Orphans' Court has yet to rule on the Beneficiaries' objections to Basciano and Palmer's accounting, which included the SR Utility Stock Transfer. Until the Orphans' Court determines the validity of the SR Utility Stock Transfer to Three Keys, the Estate maintains its interest in the SR Utility shares, which remain property under the jurisdiction of the Orphans' Court. Id.

228.

(emphasis

supplied).

Subsequently,

the

Court

concluded by citing instances wherein the probate exception did not apply, and then once again emphasized the declaratory nature of Three Keys LTDâ&#x20AC;&#x2122;s complaint: [I]n Marshall v. Lauriault, 372 F.3d 175, 180-82 (3d Cir.2004), we held that the probate exception did not apply to a dispute between beneficiaries to a trust and adult adoptees of one of the beneficiaries over their right to trust income. In Lauriault, as in Markham, after the federal court decreed rights to the estates, "[t]he marshaling of that claim with others, its priority, if any, in distribution, and all similar questions, [were left] for the probate court upon presentation to it of the judgment or decree of the federal court." Pufahl v. Parks' Estate, 299 U.S. 217, 226, 57 S.Ct. 151, 81 L.Ed. 133 (1936). Contrary to Markham and Lauriault, a principal and necessary object of Three Keys' complaint is the establishment of its property interest in SR Utility. Because that object calls for the exercise of in rem jurisdiction over property in the custody of the Orphans' Court, the probate exception applies, and we are without jurisdiction to proceed.

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Id. at 230. (emphasis supplied). In the case sub judice, the State Court Judge specifically closed the estate, ECF #80, and a stay of that order was denied by both the appellate division, as well as the Supreme Court.

such, “in rem” jurisdiction of an estate asset is no longer an issue.

More significantly, however, plaintiff is not seeking a

declaratory

judgment,

she

seeking

damages,

which

include

damages for her significant attorneys fees, and the “distribution” of her shares was based on systematic fraud, supra.

Moreover,

none of the cases which found refuge in the probate exception involve the type fraud calculated to “thwart the judicial process” cited by the 3rd Circuit in Williams v. BASF, supra.

This is

particularly true regarding the addition of Ms. Thomas S. Howard as a defendant.

VII.

RICO Standing - O’Connor Concurrence and Proximate Cause

[HOLMES, PSLRA] In

Holmes v. Securities Investor Protection Corporation, 503

US 258 (1992), the Court avoided resolution of a split among circuits regarding securities fraud RICO standing, wherein some courts had held that a RICO plaintiff needed to meet 10(b)(5)’s standing criteria, and others found that they did not.

The Court

avoided ruling on that issue by identifying a dispositive proximate cause element.

Id.

Justices

O’Connor,

White,

and Stevens, 32

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however, would have resolved this standing issue, and the circuit split, as follows: I agree with the Court that [RICO] has a proximate cause element.... In my view, however, before deciding whether the [plaintiff] was proximately injured by [defendantâ&#x20AC;&#x2122;s] alleged activities, we should first consider the standing question that was decided below...In resolving that question, I would hold that a plaintiff need not be a purchaser or a seller to assert RICO claims predicated on violations of fraud in the sale of securities. Holmes, 502 US at 277. However the above holding, which did not resolve the issue of 10(b)(5) RICO standing, may have been rendered moot by a 1995 act of Congress as set forth in Bald Eagle Area School Dist. v. Keystone Financial,

189 F. 3d 321 (3rd Circuit 1999): Prior to 1995, a private plaintiff could assert a civil RICO claim for securities law violations sounding in "garden variety" fraud.. [citation omitted].. Inasmuch as "fraud in the sale of securities" was a predicate offense in both criminal and civil RICO actions... plaintiffs regularly elevated fraud to RICO violations because RICO offered the potential bonanza of recovering treble damages. However, in 1995, Congress enacted the Private Securities Litigation Reform Act ("PSLRA"), Pub.L. No. 104-67, 109 Stat. 737 (1995). The PSLRA amended RICO by narrowing the kind of conduct that could qualify as a predicate act. Section 107 of the PSLRA (known as the "RICO Amendment") amended 18 U.S.C. Â§ 1964(c), to provide in relevant part as follows: Any person injured in his business or property by reason of a violation of section 1962 of this chapter may sue therefor in any appropriate United States District Court and shall recover threefold the damages he sustains and the cost of the suit, including a reasonable attorney's fee, except that no person may rely upon any conduct that would have been actionable as fraud in the purchase or sale of securities to establish a violation of section 1962. 33

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Bald Eagle Area School, 189 F.3d at 327. The foregoing notwithstanding, in Brokerage Concepts, Inc. v. US Healthcare, Inc., 140 F. 3d 494 (3rd Cir. 1998), the

ratified

Third Circuit

the general Holmes holding, albeit in the context of an

antitrust action, and in the process seemingly merged Holmes’ RICO proximate cause inquiry with the (unresolved) standing inquiry, thus underscoring

the

intimate

relationship

between

RICO

standing

and

proximate cause:

Unlike the injuries suffered by the non-purchasing customers in Holmes, BCI's injury was not contingent upon any injury to Gary's, nor is it more appropriately attributable to an intervening cause that was not a predicate act under RICO. Here, BCI's TPA relationship with Gary's was a direct target of the alleged scheme — indeed, interference with that relationship may well be deemed the linchpin of the scheme's success. Accordingly, we conclude that BCI had standing to pursue its civil RICO claim Brokerage Concepts, 140 F. 3d at 521. (emphasis supplied).

[RICO STANDING/PROXIMATE CAUSE ANALYSIS CASE SUB JUDICE]

As can be expected,

the 1995 PSLRA act generated further

litigation and circuit splits, particularly as regards the issue of what constitutes a securities fraud claim which could have been “actionable”, and therefore excluded as a RICO predicate act. However, that inquiry merits a separate brief in its own right. For purposes of the within motion before this Honorable Court, the plaintiff notes that SAC Count XII alleges a 10(b)(5) action. Ergo, if the 10(b)(5) action is viable on the merits, then it 34

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cannot be pled as a RICO predicate act.

If this Court finds that

the 10(b)(5) action is not meritorious as pled then, presumably, it is not “actionable” and therefore can be pled as a RICO predicate act under PSLRA. Furthermore, and the 10(b)(5) predicate act notwithstanding, it is respectfully submitted that the remaining RICO predicate acts, not based on 10(b)(5), are proper under Broker Concepts, supra, in that it is rather clear that plaintiff was a direct target or victim of the 401K scheme, the 602K payroll fraud which depleted the funds of a company which she would have been 55% owner, the sale of the Toben property which she would have owned 51%, et al. CONCLUSION Somehow, in what may be a telling reality which must be candidly disclosed, defendants pulled off a hoax – and disinherited an innocent widow who had been severely victimized for nearly seven years,

with

every

ruling

from

every

Court,

even

simple

adjournments, denied or otherwise in favor of the executor in five years of litigation.

The executor, in fact,

since 2012 has had

full unimpeded authority, has openly acted with impunity and, after being

sued,

with

the

assistance

counsel

engineered

nefarious scheme which the State Court Judge wittingly ratified. These acts should concern any person or entity integrity.

of any modicum of

To be sure, and this point ought not be lost in 35

APP346

Case 2:18-cv-11023-KM-JAD Document 90 Filed 09/20/19 Page 40 of 40 PageID: 1853

translation, this is not a case wherein plaintiff went to court with testimony from third party witnesses, whose testimony was then undermined by new witnesses produced by the executor. is not that case.

This

Instead, this pressing matter regards hours of

compelling recordings and admissions by the defendants themselves, which they then sought to completely â&#x20AC;&#x153;disappearâ&#x20AC;? after they were sued,

not

with

new

witnesses,

but

with

their

own

post-suit

statements, with one stroke of the pen. Plaintiff therefore

seeks relief from this Honorable Court.

Respectfully Submitted. Dated: September 20, 2019

_______________________________________ Santos A. Perez, Esq. Attorney for Plaintiff

APP347

Case 2:18-cv-11023-KM-JAD Document 93 Filed 10/04/19 Page 1 of 20 PageID: 1875

KLUGER HEALEY, LLC By: David A. Ward, Esq. 106 Apple Street, Suite 302 Tinton Falls, NJ 07724 Tel: (973) 307-0800 Fax: (888) 635-1653 Attorneys for Defendants William P. Fabian, Efraim (Frank) Rajs, Cecilia Keh, Thomas D'ambrosio, Maxine Melnick, Michael Lackey, Gerald Macko, Derek Schumacher, Jimmy Samayoa, Garrett Applebaum, and Youssef Abdulah Youssef UNITED STATES DISTRICT COURT DISTRICT OF NEW JERSEY

EDITA APPLEBAUM,

Case No. 18 -cv-11023-JLL-JAD

Plaintiff, v. WILLIAM P. FABIAN, LAURENCE W. GOLD, LEAH E. CAPECE, EFRAIM “FRANK” RAJS, CECILIA KEH, THOMAS D’AMBROSIO, MAXINE MELNICK, MICHAEL LACKEY, GERALD MACKO, DEREK SCHUMACHER, JIMMY SAMAYOA, GARRETT APPLEBAUM, YOUSSEF ABDULAH YOUSSEF, VOYA FINANCIAL, INC., INTAC ACTUARIAL SERVICES, INC., ASCENSUS, LLC, SUSAN BAUER, JOHN DOES 1-10, and ABC CORP 1-10, ET AL.,

DEFENDANTS’ SUPPLEMENTAL MEMORANDUM OF LAW IN FURTHER OPPOSITION TO PLAINTIFF’S MOTION FOR LEAVE TO FILE A SECOND AMENDED COMPLAINT

Defendants.

APP348

(Document Electronically Filed)

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TABLE OF CONTENTS Page TABLE OF AUTHORITIES .......................................................................................................... ii PRELIMINARY STATEMENT .....................................................................................................1 ALLEGATIONS IN THE SECOND AMENDED COMPLAINT .................................................2 SUPPLEMENTAL ARGUMENT ...................................................................................................4 I.

THE PLEADING STANDARD ON THIS OPPOSITION TO THE CROSS-MOTION TO AMEND ....................................................................4

II.

THE PROBATE EXCEPTION BARS ANY CLAIMS BASED ON ALLEGATIONS THAT FABIAN BREACHED HIS FIDUCIARY DUTY OR THAT PLAINTIFF IS ENTITLED TO SOME GREATER OR ALTERNATIVE DISTRIBUTION FROM THE ESTATE ................................................................6

III.

PLAINTIFF FAILS TO IDENTIFY HOW SHE HAS ANY STANDING TO SUE FOR ANY ALLEGED HARM ...........................................8

IV.

PLAINTIFFâ&#x20AC;&#x2122;S COMPLAINTS ABOUT THE LITIGATION CONDUCT OF DEFENDANTS ARE BARRED BY THE LITIGATION PRIVILEGE ..................................................................................12

CONCLUSION ..............................................................................................................................17

APP349

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TABLE OF AUTHORITIES Page Cases Ashcroft v. Iqbal, 556 U.S. 662129 S. Ct. 1937, 173 L. Ed. 2d 868 (2009) .................................................4 Advanta Corp. Sec. Litig.,) 180 F.3d 525 (3d Cir. 1999) ............................................................................................5, 11

Basic Inc. v. Levinson, 485 U.S. 224, 108 S. Ct. 978, 99 L. Ed. 2d 194 (1988) ...........................................10 Blue Chip Stamps v. Manor Drug Stores, 421 U.S. 723, 95 S. Ct. 1917, 44 L. Ed. 2d 539 (1975) ...........................................10 Cnty. of Hudson v. Janiszewski, 351 F. App'x 662 (3d Cir. 2009) ......................................................................................4 Connelly v. Lane Const. Corp., 809 F.3d 780 (3d Cir. 2016).............................................................................................5

Delray Holding, LLC v. Sofia Design & Dev. at S. Brunswick, LLC, 439 N.J. Super. 502 (App. Div. 2015) .......................................................................10 Dura Pharm., Inc. v. Broudo, 44 U.S. 336, 125 S. Ct. 1627, 161 L. Ed. 2d 577 (2005) ........................................10 Giles v. Phelan, Hallinan 86 Schmieg, L.L.P., 901 F. Supp. 2d 509 (D.N.J. 2012) ..................................................................................12, 13 In re NAHC, Inc. Sec. Litig., 306 F.3d 1314, 1332 (3d Cir. 2002).................................................................................4 In re Schering-Plough Corp. Intron/Temodar Consumer Class Action 2009 U.S. Dist. LEXIS 58900 (D.N.J. July 10, 2009). ....................................................5 Marjam Supply Co. v. Firestone Bldg. Pros. Co., LLC, 2014 U.S. Dist. LEXIS 46572, (D.N.J. Apr. 4, 2014) .....................................................4

Marshall v. Marshall, 547 U.S. 293, 126 S. Ct. 1735, 164 L. Ed. 2d 480 (2006) ......................................7

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Otto v. Judiciary Courts of N.J., 2018 U.S. Dist. LEXIS 8697 (D.N.J. Jan. 16, 2018) ...............................................14 Pepe v. Gen. Motors Acceptance Corp., 254 N.J. Super. 662 (App.Div.), certif. denied, 130 N.J. 11 (1992) ................................8, 9

Thomason v. Norman E. Lehrer, P.C., 183 F.R.D. 161 (D.N.J. 1998) .....................................................................................15 Three Keys Ltd. v. SR Util. Holding Co., 540 F.3d 220 (3d Cir. 2008).............................................................................................6, 7

iii

APP351

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PRELIMINARY STATEMENT On August 12, 2019, the Court held oral argument on Plaintiff’s motion for leave to file a Second Amended Complaint. See Docket Entry No. 86. After argument, the Court directed the parties to submit a supplemental brief specifically addressing the issues of: (1) standing; (2) application of the litigation privilege to the new claims in the Second Amended Complaint; and (3) application of the probate exception to the Court’s jurisdiction over the new claims that Plaintiff seeks to add in the Second Amended Complaint (“SAC”). In the pages below, Defendants will explain why each of these issues further support the Court’s denial of leave for Plaintiff to add even more scandalous pleadings to this docket. As Plaintiff’s supplemental brief makes clear, the new claims of the SAC are devoid of any factual basis and are nothing more than another discharge of Plaintiff’s repeated anger from unsuccessfully asserting claims in the Probate Court and Plaintiff’s frustration at the length of time required for the conclusion of the Estate Litigation. Plaintiff’s supplemental brief tosses about words and phrases like “systematic fraud”, an “elaborate hoax” to fabricate evidence, the knowing “ratification” of a “nefarious scheme” by a State Court Judge, and other scandalous claims without any regard to their materiality or veracity. More critically here, Plaintiff’s supplemental brief demonstrates the intended use of federal litigation as a weapon to attack the witnesses, parties, counsel, and the court, in the Probate Action. Plaintiff addresses the issues of standing, the litigation privilege and probate exception without ever tying these issues to

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APP352

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any facts that could support the proposed new claims.1 The Court should therefore deny Plaintiff’s motion to file the SAC and permit the Defendants to move for the dismissal of the entirety of this matter. ALLEGATIONS IN THE SECOND AMENDED COMPLAINT As this is a supplemental brief, Defendants respectfully refer the Court to the underlying brief filed under Docket No. 73 for a complete statement of the applicable facts and law on this motion. Defendants note that despite the Court’s prior admonition that the only issues to be addressed in the supplemental briefing are the proposed new claims of the SAC (with the underlying claims of the FAC to be addressed after a ruling on this motion), the vast portion of Plaintiff’s supplemental brief addresses the RICO and related fraud claims against Defendants contained in the FAC. Defendants will reserve argument on these issues until the time for briefing on Defendants anticipated motion to dismiss. Plaintiff’s supplemental brief largely restates the same facts alleged in prior briefing, but with one key fact that pertains to the proposed new claims that is significant here. That fact relates to adding new parties Thomas Howard, Esq., and his law firm, Gartenberg Howard. The allegations concern the filing of the Sun Bank lawsuit against

The statement regarding Plaintiff’s motives for this litigation is based on public statements on Plaintiff’s counsel’s LinkedIn page: “In "The Executor", a non-fiction legal novel, I will discuss inter alia a nefarious RICO conspiracy which took place on American soil, to wit, an "off the books" business partner of decedent takes over a multi-million dollar estate and various companies, leaving a widowed school teacher and at least one of her children with essentially nothing. Judges, unable to accept that "wholesome" attorneys and accountants contributed to this conspiracy, willingly ignored compelling proofs, . . . .” Any press inquiries regarding this on-going litigation and soon-to-be published novel, please call my office.” October 4, 2019 Declaration of David Ward, Exh. 1. 1

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APP353

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Todd Harris Company. This issue appears to be the sole basis upon which Plaintiff asserts the claims of fraudulent concealment, aiding and abetting fraud, and conspiracy against Mr. Howard and his firm. Plaintiff also cites this as the basis for naming Mr. Howard in the RICO Counts of the SAC. See Plaintiff’s Supplemental Brief at p. 19-20. What Plaintiff alleges as “fraud” is the October 30, 2018 Certification of Mr. Howard submitted in the Probate Action. (A copy of that Certification is annexed to the Ward Declaration as Exhibit 2). In that Certification, Mr. Howard explained that he had previously believed that the Sun Bank lawsuit had actually been filed. (Howard Cert., ¶ 2). However, Mr. Howard could locate only an unfiled copy of the Complaint, so he searched the State Court electronic filing system for a filed copy of the Sun Bank complaint. (Id. at ¶ 3). Upon searching the State Court system, Mr. Howard found there was no docket entry for any action filed against Todd Harris Company in Somerset County (the County of venue for the Sun Bank action. (Id.).2 To correct the record, Mr. Howard submitted the October 30, 2018 Certification explaining the basis for his prior statement to the Court about the Sun Bank suit having been filed. (Id.). It now appears from Plaintiff’s allegations that the Sun Bank lawsuit was in fact filed and then immediately settled. As discussed below, the SAC fails to state any fact that Plaintiff was damaged or that Plaintiff or anyone else took any action as a result of the October 30, 2018 Certification.

Indeed, to this day the filed Sun Bank action against Todd Harris Company does not appear on -3-

APP354

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SUPPLEMENTAL ARGUMENT I THE PLEADING STANDARD ON THIS OPPOSITION TO THE CROSSMOTION TO AMEND As the Court is aware, a motion for leave to amend should be denied where the amended complaint would not survive a motion to dismiss. See Cnty. of Hudson v. Janiszewski, 351 F. App'x 662, 666 (3d Cir. 2009) (quoting Alvin v. Suzuki, 227 F.3d 107, 121 (3d Cir. 2000)); see also In re NAHC, Inc. Sec. Litig., 306 F.3d 1314, 1332 (3d Cir. 2002) ("We have made it clear that an amendment would be futile when 'the complaint, as amended, would fail to state a claim upon which relief could be granted.'") Therefore, "[t]he futility analysis on a motion to amend is essentially the same as a Rule 12(b)(6) motion." Marjam Supply Co. v. Firestone Bldg. Pros. Co., LLC, 2014 U.S. Dist. LEXIS 46572, *3 (D.N.J. Apr. 4, 2014). To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to 'state a claim for relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S. Ct. 1937, 173 L. Ed. 2d 868 (2009). â&#x20AC;&#x153;A claim has facial plausibility when the pleaded factual content allows the court to draw the reasonable inference that the defendant is liable for misconduct alleged." Id. "Determining whether the allegations in a complaint are plausible is a contextspecific task that requires the reviewing court to draw on its judicial experience and common sense." Id. at 679. a party search on the New Jersey court website. See Ward Declaration, Paragraph 3. -4-

APP355

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Even when there are specific factual allegations, the court assumes their veracity but then also must “determine whether they plausibly give rise to an entitlement to relief.” Connelly v. Lane Const. Corp., 809 F.3d 780, 787 (3d Cir. 2016). In addition to this assessment of the SAC, each of the proposed new claims are subject to the heighted pleading requirements of Rule 9(b), which states: "In all averments of fraud or mistake, the circumstances constituting fraud or mistake shall be stated with particularity." Fed. R. Civ. P. 9(b). This particularity requirement has been rigorously applied in securities fraud cases, therefore, a plaintiff averring securities fraud claims must specify "'the who, what, when, where, and how: the first paragraph of any newspaper story.'" See Advanta Corp. Sec. Litig., 180 F.3d 525, 534 (3d Cir. 1999). Similarly, Plaintiff’s RICO claims and other claims of fraud are also subject to this heightened pleading standard. In re Schering-Plough Corp. Intron/Temodar Consumer Class Action, 2009 U.S. Dist. LEXIS 58900, at *94 (D.N.J. July 10, 2009). Applying those standards here, the motion to file the SAC should be denied for the reasons articulated below.

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APP356

Case 2:18-cv-11023-KM-JAD Document 93 Filed 10/04/19 Page 10 of 20 PageID: 1884

II THE PROBATE EXCEPTION BARS ANY CLAIMS BASED ON ALLEGATIONS THAT FABIAN BREACHED HIS FIDUCIARY DUTY OR THAT PLAINTIFF IS ENTITLED TO SOME GREATER OR ALTERNATIVE DISTRIBUTION FROM THE ESTATE

Count Thirteen of the SAC alleges that Fabian’s actions as Executor of the Estate breach his fiduciary duty to the Estate. Correspondingly, Count Fourteen of the SAC alleges that proposed new defendant Thomas Howard, and defendants Rajs, Gold, Capece, and the employees of THC who attested to the facts as they knew them (the “affiant defendants”), are liable for aiding and abetting the Fabian breach of fiduciary duty to the Estate. Both Counts Thirteen and Fourteen would require – first and foremost – an invasion by this federal court into the propriety of the handling of estate property in the custody of the probate court. This is because any relief that Plaintiff seems to seek would require a finding that the Executor mismanaged Estate assets or that these assets (namely, the stock of THC) have not been properly distributed. Such intervention is barred by the Probate Exception and requires dismissal of these counts. See Three Keys Ltd. v. SR Util. Holding Co., 540 F.3d 220, 227 (3d Cir. 2008). As the Court in Three Keys noted, “the probate exception is a jurisdictional limitation on the federal courts originating from the original grant of jurisdiction in the Judiciary Act of 1789." Three Keys Ltd., 540 F.3d 220, 226 (3d Cir. 2008). Under this exception, federal courts lack jurisdiction over "the probate or annulment of a will [or] -6-

APP357

Case 2:18-cv-11023-KM-JAD Document 93 Filed 10/04/19 Page 11 of 20 PageID: 1885

the administration of a decedent's estate." Marshall v. Marshall, 547 U.S. 293, 311, 126 S. Ct. 1735, 164 L. Ed. 2d 480 (2006). In the Third Circuit, the probate exception applies if the "federal court is endeavoring to (1) probate or annul a will, (2) administer a decedent's estate, or (3) assume in rem jurisdiction over property that is in the custody of the probate court." Three Keys Ltd., 540 F.3d at 227 (emphasis added). Under the Probate Exception, this Court lacks subject matter jurisdiction over Plaintiff's causes of action that would interfere with the administration of the Todd Harris Applebaum Estate or would require the Court to assume jurisdiction over property in the custody of the Superior Court of Middlesex County, Probate Part. This would include Plaintiff’s claim of entitlement to shares in Todd Harris Company, her claims that would compel payment from the Estate for alleged wrongful sale or disposition of Estate assets (and the valuation of those assets), claims based on delays in any distributions to Plaintiff, claims as to Plaintiff’s interest in the Toben property and the appraisal and alleged wrongful sale of same, claims of breach or aiding and abetting breach of fiduciary duty by the Executor, and any other claims that would interfere with the current Estate Administration in the Probate Action. Contrary to Plaintiff’s argument, the Third Circuit rejects such federal judicial intervention into probate matters. In the very language of the Three Keys decision cited by Plaintiff in her opposition, the Third Circuit affirmed the dismissal of the complaint because “a principal and necessary object of Three Keys’ complaint is the establishment of its property interest in the [company at issue].” Here, Plaintiff seeks this court’s ruling -7-

APP358

Case 2:18-cv-11023-KM-JAD Document 93 Filed 10/04/19 Page 12 of 20 PageID: 1886

that would give her an entitlement to Estate property, the major asset of which is a corporation in which she is not even a shareholder, and that would direct the distribution of assets that remain subject to the jurisdiction of the Probate Court. By asking this Court to rule on matters such as the distribution to Plaintiff of Estate assets, or on the claims directly related to Estate assets such as the sale of the Toben property, the operations of the THC (which is an Estate asset), and other matters touching Estate property, Plaintiff seeks the improper judicial intervention into probate matters, which the Probate Exception precludes this Court from undertaking. Plaintiff fails to explain how the relief she seeks can be granted without this Court interfering with the Probate Action.

Such interference is barred by the Probate

Exception, and also barred for the other reasons cited in Defendants’ opposition brief. Therefore, the motion to amend to add any claims under Counts Thirteen or Fourteen should be denied. III PLAINTIFF FAILS TO IDENTIFY HOW SHE HAS ANY STANDING TO SUE FOR ANY ALLEGED HARM Even though Plaintiff addresses standing at length in her Supplemental Brief, she never states how she – as a beneficiary of an undistributed estate – has standing to sue for injury to a company that she has only a possible ownership interest in. In fact, even if Plaintiff were deemed to have the equivalent of a shareholder interest in THC, shareholders in a corporation may only sue individually when they suffer a "special injury," as distinct from injuries suffered by all shareholders. Pepe v. Gen. Motors -8-

APP359

Case 2:18-cv-11023-KM-JAD Document 93 Filed 10/04/19 Page 13 of 20 PageID: 1887

Acceptance Corp., 254 N.J. Super. 662, 666, (App.Div.), certif. denied, 130 N.J. 11 (1992). "A special injury exists 'where there is a wrong suffered by [a] plaintiff that was not suffered by all stockholders generally or where the wrong involves a contractual right of the stockholders, such as the right to vote.'" Delray Holding, LLC v. Sofia Design & Dev. at S. Brunswick, LLC, 439 N.J. Super. 502, 510 (App. Div. 2015) (quoting In re TriStar Pictures, Inc., 634 A.2d 319, 330 (Del.1993)). Plaintiff’s supplemental brief injects a slew of adjectives but nowhere does Plaintiff even attempt to identify a special injury to her that could give her standing to pursue any claims of fraud or negligence related to Fabian’s compensation, the sale of the Toben property, or the Sun Bank loan and its resulting settlement, or any other conduct she complains of which is all premised upon the claim that she is entitled to a greater inheritance in an Estate that has not yet been administered. Plaintiff’s lack of standing and her failure to identify any damages sustained from the conduct she alleges also requires dismissal of her claim, under Count Twelve, alleging that the Estate’s application to satisfy Plaintiff’s interest as a beneficiary in the Probate Action by payment of her prospective shareholder interest in lieu of issuance of company stock is a violation of SEC Rule 10b-5 (codified at 17 C.F.R. 240.10b-5 of the U.S. securities laws). Rule 10(b)(5) prohibits any act of fraud in the purchase or sale of a security. A prerequisite to any claim under this Rule is the ownership interest in a security. As is repeated throughout the SAC, Plaintiff has never received any distribution of stock in -9-

APP360

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THC, and her right to any such distribution rests with the discretion of the Court in the Probate Action (a decision which Plaintiff notes is currently under appeal). Nowhere in the SAC or the Supplemental Brief does Plaintiff assert how she could have standing to assert a securities violation when she was never a holder of any securities. Under Rule 10(b)(5), for a Plaintiff to assert a claim she must have either purchased or sold securities that are subject to the Act. In Blue Chip Stamps v. Manor Drug Stores, 421 U.S. 723, 95 S. Ct. 1917, 44 L. Ed. 2d 539 (1975), the Supreme Court examined the text of Rule 10b-5 and concluded that a claim could not be asserted by a shareholder who was neither a "purchaser" nor "seller" in relation to the alleged fraud. Rule 10b-5 prohibits any act which operates as a fraud or deceit and makes it illegal "[t]o make any untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements made in the light of the circumstances under which they were made, not misleading . . . in connection with the purchase or sale of any security." 17 C.F.R. ยง 240.10b-5(b).

To assert a claim under this Rule, "the basic

elements include: (1) a material misrepresentation . . . ; (2) scienter, i.e., [defendant's] wrongful state of mind; (3) a connection with the purchase or sale of a security; (4) reliance, often referred to . . . as 'transaction causation'; (5) economic loss; and (6) loss causation, i.e., a causal connection between the material misrepresentation and the loss." Dura Pharm., Inc. v. Broudo, 544 U.S. 336, 341, 125 S. Ct. 1627, 161 L. Ed. 2d 577 (2005) (citing 15 U.S.C. ยง 78u-4(b)(4); Basic Inc. v. Levinson, 485 U.S. 224, 231-232, 248-249, 108 S. Ct. 978, 99 L. Ed. 2d 194 (1988). -10-

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In addition, as noted above FRCP 9(b) imposes a heightened pleading requirement of factual particularity with respect to allegations of fraud. This particularity requirement has been rigorously applied in securities fraud cases, therefore, a plaintiff averring securities fraud claims must specify "'the who, what, when, where, and how: the first paragraph of any newspaper story.'" See Advanta Corp. Sec. Litig., 180 F.3d 525, 534 (3d Cir. 1999). Therefore, when stating the "falsity," i.e., "material misrepresentation" element of a Rule 10(b)(5) claim, a securities fraud plaintiff must "specify each statement alleged to have been misleading, the reason or reasons why the statement is misleading, and, if an allegation regarding the statement or omission is made on information and belief, the complaint shall state with particularity all facts on which that belief is formed." See In re Intelligroup Sec. Litig., 468 F. Supp. 2d 670, 675-77 (D.N.J. 2006)(citations omitted). Here, Plaintiff cannot even allege that she qualifies as a shareholder of THC, let alone a purchaser or seller. She has not alleged any facts suggesting that the stock of Todd Harris Company is subject to federal securities laws, nor has she alleged how a proposal to satisfy the bequest to Plaintiff in cash in lieu of stock violates Rule 10(b)(5). Plaintiff also cannot allege any harm since the proposed transaction which she complains of has not even occurred because the estate litigation remains pending on appeal. Plaintiff cannot establish that there has been anything more than a proposal that her interest in Todd Harris Company to be satisfied by a cash payment in lieu of shares.

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APP362

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In short, when it comes to alleging standing or any facts to state a claim for violation of Section 10(b) the allegations of the SAC fall woefully short. IV PLAINTIFF’S COMPLAINTS ABOUT THE LITIGATION CONDUCT OF DEFENDANTS ARE BARRED BY THE LITIGATION PRIVILEGE

As previously briefed, the court held in Giles v. Phelan, Hallinan 86 Schmieg, L.L.P., 901 F. Supp. 2d 509 (D.N.J. 2012) that New Jersey’s litigation privilege "ensures that [s]tatements by attorneys, parties and their representatives made in the course of judicial or quasi-judicial proceedings are absolutely privileged and immune from liability." Giles, 901 F. Supp. 2d at 523 (internal quotations and citations omitted). The privilege is "expansive" and "well-established" in New Jersey. Id. New Jersey courts have extended the privilege even to statements made by attorneys outside the courtroom—for example, during interviews and settlement conferences. Id. (citation omitted). Plaintiff’s Supplemental Brief cites to exceptions to the litigation privilege such as sham litigation or destruction of evidence that are simply inapplicable here. As to the claims against Mr. Howard and his law firm, there is no plausible allegation that they destroyed or falsified any evidence. The only claim Plaintiff asserts is that Mr. Howard submitted a Certification in which he corrected a previous statement (that in fact turned out to be true-i.e. that the Sun Bank lawsuit was filed). The submission of a Certification by an attorney is the very essence of the type of pleading that deserves the protection of -12-

APP363

Case 2:18-cv-11023-KM-JAD Document 93 Filed 10/04/19 Page 17 of 20 PageID: 1891

the litigation privilege. It is a “communication (1) made in judicial or quasi-judicial proceedings; (2) by litigants or other participants authorized by law; (3) to achieve the objects of the litigation; and (4) that have some connection or logical relation to the action." Giles, 901 F. Supp. 2d at 523 (internal quotations and citations omitted). Not only does Plaintiff fail to identify any fraud or misrepresentation by Mr. Howard, she cannot establish how it even matters if the Sun Bank suit was in fact actually filed. No party disputes that Sun Bank asserted a claim and as a result a meeting was held and the claim promptly settled. Whether Sun Bank actually filed the Complaint that all parties acknowledge was prepared and distributed is utterly immaterial. Plaintiff has failed to state in any way how she could be damaged by this event. To assert a claim of fraud, aiding and abetting fraud, conspiracy and RICO against an attorney who inaccurately cited in a judicial pleading the status of a previously filed and settled matter is the kind of mean spirited and contentious conduct that the litigation privilege is designed to prevent. Plaintiff’s reliance on the “sham litigation” exception to the litigation privilege is also without merit.3 First, the claims Plaintiff asserts here sound in fraud, and therefore any claimed conduct that falls outside of the litigation privilege must be plead with specificity and not in the rambling narrative that casts aspersions without any substance. Plaintiff fails to satisfy the heightened pleading standard and fails to provide any basis for Plaintiff also extensively argues the application of Noerr-Pennington to this matter. That issue was briefed and is applicable to the motion to dismiss the underlying complaint. It is not applicable here and therefore Defendants respectfully reserve the right to address that and all other issues on the renewed motion to dismiss.

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APP364

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application of any exception to the litigation privilege. The “sham litigation” exception cited by the court in ADP, LLC v. Ultimate Software Group, Inc., Civil Action No. 1608664 (KM)(MAH) is simply inapplicable here. In that case Ultimate Software alleged a pattern of litigation conduct by ADP that was intended to interfere with Ultimate’s relationships and to chill Ultimate’s business activities. Here, Plaintiff has not alleged any facts to support the claim that the filing of any lawsuit was undertaken as a pattern of behavior to cause her harm. Regarding motions and pleadings, there is no support for the argument that the filing of a motion is an exception to the litigation privilege. For example, the motion to approve the final accounting and permit a distribution in accordance with the late Will of Todd Harris is another clear example of the very type of action governed and protected by the litigation privilege. To suggest that the attorney who prepares such a pleading is subject to suit would open up the doors to lawsuits against every adversary for any pleading deemed harmful by an opponent in litigation. Thankfully the litigation privilege is much broader than that argued by Plaintiff and the sham exception much narrower. As Judge McNulty held in Otto v. Judiciary Courts of N.J., 2018 U.S. Dist. LEXIS 8697, at *36 (D.N.J. Jan. 16, 2018), claims based on positions taken in the state court litigation are subject to the litigation privilege. Thus, application of the privilege bars any claims against attorneys for positions taken or pleadings filed, and also bars any claims that Plaintiff may assert against the current Defendants based upon the alleged 2017 motion to “disinherit her,” by selling her shares, as alleged in Count XII. -14-

APP365

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The litigation privilege also bars any claims of breach of fiduciary duty as alleged in Count XIII, because those claims concern the actions taken in the Probate Action (as opposed to any action outside the scope of the litigation). In that Count, Plaintiff asserts that the positions taken by Defendant Fabian as Executor of the Estate have caused her injury. All of the statements that Plaintiff cites to in support of her claims under Counts XII and XIII were made by litigants in the Probate Action. The litigation privilege bars such claims because it affords litigants and witnesses "the utmost freedom of access to the courts without fear of being harassed subsequently by derivative tort actions." Id. The litigation privilege also bars the claims of Counts Fourteen, Fifteen and Sixteen of the SAC, alleging aiding and abetting fraud and fraudulent concealment by the parties and the attorneys for THC and for the Estate of Todd Harris in the course of the Probate Action. The New Jersey Supreme Court has determined that the presentation of facts and opinions, either in filed documents or in the courtroom itself is an integral part of a pending litigation, and the judicial process as a whole, and defamatory, even threatening statements by attorneys, and others only tangentially associated with the litigation, are covered by the litigation privilege. Thomason v. Norman E. Lehrer, P.C., 183 F.R.D. 161, 167-68 (D.N.J. 1998). Moreover, there can be no more integral part of litigation than an argument set forth in a motion â&#x20AC;&#x201C; which is precisely the widow Applebaumâ&#x20AC;&#x2122;s grievance with the submissions filed by Defendants Howard and Gartenberg Howard. See Thomason, 183 F.R.D. at 167-68.

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APP366

Case 2:18-cv-11023-KM-JAD Document 93 Filed 10/04/19 Page 20 of 20 PageID: 1894

CONCLUSION The proposed SAC is the product of a design to harass and intimidate the persons and parties involved in the Probate Action, to have this Court usurp the jurisdiction and overturn the decisions of the Probate Court, and to expose all parties and non-parties who ever opposed Plaintiff to the burden and expense of a lawsuit. Plaintiff and her counselâ&#x20AC;&#x2122;s use of the judicial system as a method to intimidate any witness, attorney, or judge who opposes Plaintiffâ&#x20AC;&#x2122;s view represents a wanton disregard for the protections of the judicial process afforded to litigants, witnesses, and their counsel. Even after being afforded supplemental briefing Plaintiff has been unable to show how she has standing to pursue claims for alleged harm done to THC, or how this Court can rightfully interfere with the Probate Action and direct the distribution of assets in a manner contrary to the Will of Todd Harris Applebaum and the decisions of the State Court, or how the claims based on arguments and motions filed in the state court litigation are not absolutely immune from suit based on the litigation privilege. On these grounds Defendants oppose the motion for leave to file a Second Amended Complaint.

Dated: October 4, 2019

Respectfully submitted, KLUGER HEALEY, LLC

By: s/ David A. Ward David A. Ward

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