2019 04:56 pm

SUPREME COURT OF THE STATE OF NEW YORKCOUNTY OF NEW YORK

---------------------X

VINCENT V HODES FAMILY IRREVOCABLE Index No. 151712/2017

TRUST,

Plaintiff,

FOURTH AMENDEDVERIFIED COMPLAINT

- against -

JURY TRIAL REQUESTEDADVANCE ENTERTAINMENT, LLC, JOSEPH

MELI, RESET PARTNERS, LLC, HARSH

PADIA, MOSTLY DUNE HOLDINGS, LLC,JASON LIEBMAN, KID SHELLEEN, LLC,KARL MIKAEL ANDREN and DAVID

MOLNER,

Defendants.--------------- --------X

Plaintiff Vincent V Hodes Family Irrevocable Trust("Hodes"

or "Plaintiff"), by and

through its attorneys, John Murphy & Associates, P.C., alleges the following against Defendants

Advance Entertainment, LLC ("Advance"), Joseph Meli ("Meli"), Reset Partners, LLC, Harsh

Padia, Mostly Dune Holdings, LLC, Jason Liebman, Kid Shelleen, LLC, Karl Mikael Andren,

and, David Molner (collectively, "Defendants"). Except where otherwise stated, all of the

following allegations are based upon information and belief.

PRELIMINARY STATEMENT

1. As also detailed in a Fourth Amended Complaint being filed at this time by plaintiff

in a companion case in this Court, TGT, LLC v. Advance Entertainment et al., Index No.

650633/2017 (the "TGT Plaintiff"), the allegations of which are incorporated herein, this action

arises from the creation and orchestration of a fraudulent investment scheme by Defendant Meli,

the co-CEO, head of the Entertainment Division, and a Director of DTI Management, LLC

("DTI"), a leading player in the live event ticket industry.

FILED: NEW YORK COUNTY CLERK 03/12/2019 04:56 PM INDEX NO. 151712/2017

NYSCEF DOC. NO. 128 RECEIVED NYSCEF: 03/12/2019

1 of 35

2. Meli, through the auspices of Defendant Advance first represented that he, DTI and

Advance were in the business of purchasing and reselling tickets to concerts and other live events.

3. Meli then falsely asserted that DTI and Advance, through Meli's efforts, had

secured an opportunity from Ambassador Theatre Group Ltd. ("ATG"), a major international

theatre organization, to purchase large blocks of tickets to the 2017-2018 two-part Broadway

performances of Harry Potter and the Cursed Child(the "ATG Agreement"). The fraudulent ATG

Agreersent was drafted for Meli by Defendant David Molner ("Molner"), who knew that the

agreement was a complete fabrication.

4. Meli fraudulently induced Plaintiff into believing that his companies DTI and

Advance had partnered in connection with the ATG Agreement, which, according to Meli, offered

a legitimate investment opportunity where Plaintiff would earn a substantial return on each ticket

sold based on the amount invested.

5. These multiple fraudulent and deceptive acts resulted in the theft of $300,000 from

Plaintiff (and $7,860,000 from the TGT Plaintiff) that Meli funneled into Meli's Ponzi scheme.

Rather than being used for the intended purpose of ticket purchases, Meli took Plaintiff and the

TGT Plaintiff's funds and wired them to the accounts of Defendants Reset Partners, LLC ("Reset

Partners"), Harsh Padia ("Padia"), Mostly Dune Holdings, LLC ("Mostly Dune Holdings"), Kid

Shelleen, LLC ("Kid Shelleen") and Karl Mikael Andren ("Andren"). The money transferred to

Mostly Dune Holdings was then transferred almost immediately thereafter to the personal account

of its sole principal, Jason Liebman ("Liebman"). It is indisputable that Plaintiff - and the TGT

Plaintiff - are the true owners of money being held by these Defendants, as their money is clearly

traceable toDefendants'

accounts.

- 2 -



2 of 35

6. Meli has since pled guilty to a felony count of securities fraud and was sentenced

to 78 months imprisonment. Meli still characterizes his extravagant scheme of willful and

intentional fraud as simple"mistakes"

and has yet to take full responsibility and accountability for

his actions.

7. Indeed, Judge Kimba Wood of the United States District Court Southern District of

New York even noted the lack of Meli's accountability in her sentencing when she stated that, "If

ever there was a case that could be expected to generate some general deterrence, it is one like this.

. . . In addition, I think Mr. Meli may well need individual deterrence in light of the many different

characterizations of his'mistakes.'

This is $100 million worth of mistakes and more. These

weren'tmistakes."

8. On June 21, 2018, Judge Wood entered an Order of Restitution directing Meli to

pay restitution to the victims of his fraudulent scheme in the amount of $56,037,924.28.

9. On February 5, 2019, Judge Wood entered a Final Order of Forfeiture against Meli

and Advance's remaining assets, which are the proceeds of the fraudulent scheme, as amended on

March 6, 2019. The U.S.Attorneys'

Office will use these funds for victim restitution. The amount

of funds that will be available for victim restitution pursuant to this Order will amount to only a

small fraction of the total amount of damages that Meli caused to his victims, as reflected in the

Restitution Order.

THE PARTIES

10. Plaintiff is a trust with its principal place of business at 2415 West 67th Street,

Mission Hills, Kansas. Amy E Hodes and Nick Hodes are trustees of Plaintiff, which was created

on or about December 22, 2009 as a vehicle for investment opportunities for the benefit of the

family of Vincent Hodes.

- 3 -



3 of 35

11. Advance is a Delaware limited liability company organized in 2011 and controlled

by Defendant Meli, its sole and managing member, with a principal place of business at 95 Horatio

Street, Apartment 701, New York, New York. According to the Delaware Department of State,

Advance is no longer in good standing.

12. Defendant Meli is a resident of New York, New York. Meli is the managing

member and 100% owner of Defendant Advance and, at all material times, was a Director, co-

CEO and the head of the Entertainment Division of DTL

13. Defendant Reset Partners is a California limited liability company organized in

2016, with a principal place of business at 9100 Wilshire Boulevard, Suite 100W, Beverly Hills,

California. Reset Partners is owned by James Stern, a successful film and Broadway producer

who is also a part owner of the Chicago Bulls of the National Basketball Association.

14. Defendant Padia is a resident of New York, New York. Padia is the CEO of HAP

Capital, LLC, a successful hedge fund and securities broker-dealer based in New York, New York.

Padia is also known for owning a lavish 5-bedroom, 6-bathroom penthouse in a luxury Tribeca

building purchased for $17.5 Million, which is prominently featured in the local news as a celebrity

hotspot. According to Advance Entertainment bank records, Padia received $2.4 Million from

Meli in the two months preceding Meli's arrest.

15. Defendant Mostly Dune Holdings is a single member Delaware limited liability

company organized in 2010 and controlled by Defendant Liebmañ, with a priñcipal place of

business at 56 Crosby Apt 5A, New York, New York 10012-4435.

16. Defendant Liebman is a resident of New York, New York and is the sole principal

of Mostly Dune Holdings. Liebman is a tech millionaire who made his fortune as the CEO of

Howcast, an instructional video website, and was the ultimate recipient of Plaintiff's funds

- 4 -



4 of 35

transferred by Meli to Mostly Dune Holdings, as the funds were later transferred from Mostly

Dune Holdings to Liebman's personal account.

17. Defendant Kid Shelleen is a Delaware limited liability company organized and

controlled by Paul Tudor Jones, with its principal place of business in the state of Connecticut.

Paul Tudor Jones, who is a successful investor and hedge fund manager, is one of the wealthiest

people in the world.

18. Defendant Andren is a resident ofthe state of Connecticut. Andren is the President

and CEO of the Paul Tudor Jones II Family Office.

19. Defendant Molner is a resident ofNew York, New York. Molner prepared the fake

ATG Agreement for Meli, as well as other fraudulent agreements, and otherwise assisted, abetted

and conspired with Meli in his fraudulent scheme.

JURISDICTIO_N AND VENUE

20. Venue is proper in the Supreme Court ofthe State ofNew York, New York County,

because Defendants Advance, Meli, Padia, Mostly Dune Holdings, Liebman, and Molner are

located in the County and State of New York, and all Defendants, including Kid Shelleen and

Andren, conduct business in the County and State of New York. Moreover, Plaintiff wired the

payments to fund the fraudulent deal to a Merrill Lynch bank account in the name of Defendant

Advance based out of New York, New York. Funds were then wired from Advance's Merrill

Lynch account to the accounts of Defendants Reset Partners, Padia, Mostly Dune Holdings,

Liebmañ, Kid Shelleen and Andren, also based out of New York, New York.

21. This Court has jurisdiction over the Defendants because the Defendants "transact

business"within this state under CPLR 302(a)(1) and/or are located here so as to be subject to

general jurisdiction under CPLR 301.

- 5 -



5 of 35

FACTUAL BACKGROUND

Defendant Meli "Baits" Plaintiff With His Position at DTI

22. Vincent Hodes is a close friend and business partner of Michael Connor who, on or

about June 10, 2016, was approached by Defendant Meli, Mr. Connor's friend of many decades.

Mr. Connor - a Governor on the Board of Plaintiff TGT - was informed by his friend Mr. Meli

about the business of DTI, a preeminent player in the secondary ticketmarket.1

Defendant Meli

was an event producer who was known for small private concerts he had organized in the

Hamptons. He told Mr. Connor that he was in discussions to purchase DTI through his company

Advance, of which Meli was the sole and managing member.

23. Meli wanted Mr. Connor to believe that Advance, which had no real track record

with respect to large ticket deals for live events, had been so successful in various deals that it was

financially capable of purchasing all or part of DTI.

24. Meli intended to use the upcoming DTI/Advance purchase transaction to increase

Mr. Connor's confidence in the legitimacy and likely success of the various "investment

opportunities"Meli would soon be offering him and others through the auspices of DTI and

Advance.

25. From June 2016 to January 2017, Meli solicited Mr. Connor's interest in investing

in live entertainment event ticket deals that were offered by the alleged DTI/Advance partnership.

Meli's representations ultimately induced Plaintiff in this case, and Mr. Connor and other investors

involved with the TGT Plaintiff, to invest millions of dollars with Meli, believing that these funds

were going to be infused into a DTI-affiliated ticket investment opportunity.

' Over the prior four years, DTI had worked with more than 100 ticket brokers and such professional sports teamsas the Cleveland Cavaliers, the New Jersey Devils and the Phoenix Suns in inanaging the respective teams' resalemarkets. (See Exhibit E to the TGT Plaintiff's Fourth Amended Complaint).

- 6 -



6 of 35

The DTI/Advance Letter of Intent

26. On June 13, 2016, Defendant Meli provided to Mr. Connor a copy of a letter of

intent (the "LOI") entered into by Advance and DTI, by which the parties agreed that Advance

would purchase 100% of the ownership interest in DTI for a total purchase price of $63 Million,

including $48 Million in cash. (See a copy of the LOI and related cover email attached as Exhibit

A to the Fourth Amended Complaint filed March 12, 2019, by the TGT Plaintiff in a related case,

referred to herein as "TGT 4th Am. Comp.")

27. Shortly thereafter, Mr. Connor learned that the $250,000 Good Faith Deposit

described in Article 5 of the LOI had been paid by Advance to DTI. (See wire transfer from

Defendant Advance to DTI attached as Exhibit B to the TGT 4th Am. Comp.)

28. Meli shared the LOI with Mr. Connor intending to begin building on Mr. Connor's

confidence in Advance's ownership in or partnership with DTI. Under the LOI, Advance, a

company which had no reputation or track record in the live event ticket industry, would purchase

DTI, a preersiñcñt player in that industry. Notably, when Meli transmitted the LOI to Mr. Connor,

Meli titled the subject of his email "45 days away fromn[o]w[,]"

and included in the body of the

email "Ownershipstructure[,]"

indicating to Mr. Connor that Advance would effectuate the

purchase of DTI within 45 days. (See Exhibit A to the TGT 4th Am. Comp.)

29. The LOI contemplated that Advance would purchase DTI for $48 Million in cash

and $15 Million in Advance's stock.

30. What Mr. Connor did not and could not know, however, is that Meli flaunted

Advance's alleged upcoming acquisition of DTI to increase the likelihood that Mr. Connor and

others such as Plaintiff would later invest money into purported entertainment industry

"investmentopportunities"

(i.e. fraudulent schemes) that Meli was then orchestrating or prepariñg

to orchestrate.

- 7 -



7 of 35

31. In reality, Advance (Meli) never intended to actually close on the acquisition

contemplated by the DTI/Advance LOI.

32. As Advance's bank records demonstrate, Advance never had anywhere near the

$48 Million in cash required to fund the acquisition. Indeed, Advance's account balances show

that it was a significant financial strain for Advance to pay even the $250,000 Good Faith Deposit.

Meli knew that paragraph 2 of the LOI-which stated that Advance had "the requisite finañcial

capacity to consummate the Transaction without any Third Party financing of any kind"-was

false.

33. Rather, Meli's intention was to use the LOI to set a benchmark value for legitimate

prospective purchasers of DTI. Effectively, Meli hoped that the $63 Million purchase price offered

by Advance would induce third parties to bid even higher to purchase DTI.

34. At the same time, the DTI/Advance LOI served to buttress Meli's story that he was

presenting to third parties-that he was the owner of all, or a controlling interest in, DTI. He

boasted this partnership in pitches to third parties (such as Mr. Connor) about his various schemes

in the secondary ticket market.

35. Meli fully intended to make these representations to third parties.

36. Meli also intended to highlight to third parties how the DTI/Advance partnership

would work. Advance would be responsible for sourcing "investmentopportunities"

in the

secondary ticket market and investor funds to place. Those investors would thereafter be able to

use DTI's online platform to monitor their investment and see details such as the number of tickets

sold and amount of return earned.

- 8 -



8 of 35

37. Unaware of any of these events behind the scenes, Mr. Connor had no reason to

doubt that Advance was the soon-to-be owner of DTI. The LOI contemplated Advance's purchase

of 100% of DTI, and the Good Faith Deposit required under the LOI had been paid.

38. Meli, knowing that Mr. Connor was"hooked,"

and that Mr. Connor would trust

him even more so given their longstanding friendship, began to solicit Mr. Connor for funds in

connection with a number of investment opportunities in the live entertainment ticket market.

39. Meli continually touted Advance's purported ownership of DTI, a well-known

company with a track record of success in the industry.

40. Meli also repeatedly boasted to Mr. Connor about the high return on investment

earned by other investors in similar deals Meli had organized involving the purchase of large

blocks of tickets to the Broadway play Hamilton and concerts for the musical artist Adele.

CVC Invests in the DTI/Advance Company Group

41. On July 18, 2016, Defendant Meli informed Mr. Connor that the form of the

proposed transaction whereby Advance would purchase DTI had changed, but for the better.

Under the revised transaction, a subsidiary of CVC Capital Partners ("CVC,"), a private equity firm

with approximately $80 Billion in assets, would purchase and/or make a substantial investment in

DTI, and Advance would receive a significant minority equity interest in that entity.

42. Meli provided to Mr. Connor a copy of a proposal prepared by CVC (the "CVC

Proposal") and shared with DTI describing how CVC would reorganize the DTI/Advance

company group after an investment by CVC. (See a copy of the CVC Proposal attached as Exhibit

C to the TGT 4th Am. Comp.)

43. The CVC Proposal contemplated a "contribution of AE [Advance Entertainment]

to a newly formed company set up to acquireDTI."

- 9 -



9 of 35

44. In addition, the CVC Proposal contemplated the "ongoing execution of certain AE

ticketdeals"

which would be contributed to the newly organized DTI entity and included, as a

proposed compensation structure to Meli, a sizeable bonus based upon "EBITDA related to AE

ticketdeals."

45. Meli informed Mr. Connor that, even under the revised structure, Meli would still

be the top executive "in charge ofDTI"

who would be responsible for organizing entertainment

industry investment opportunities similar to those already offered for the Broadway show

Hamilton and the musical artist Adele.

46. CVC, DTI, Advance and Meli apparently agreed upon a transaction by which CVC

would acquire a substantial ownership stake in DTI. Advance was expected to own a stake in DTI

through its position in CVC's new investment vehicle.

47. Just as Meli"baited"

Mr. Connor with his alleged intention to purchase DTI, Meli

further enticed Mr. Connor with CVC's investment in DTI. Meli was continuing to build upon

Mr. Connor's confidence that any investment by Mr. Connor and others in DTI and its affiliate

Advance would be safe and profitable. Defendant Meli wanted Plaintiff, through his

misrepresentations to Mr. Connor, to believe that reputable, sophisticated private equity firms

wanted to partner with Advance by making a sizeable investment in DTI, which would appareñtly

be accomplished through a new entity in which Advance would become a minority owner.

48. Meli focused his efforts on Mr. Connor, as Meli knew through his personal

relationship with Mr. Connor that Mr. Connor and his extensive network - that included Plaintiff

- had the means to pool together a substantial amount of capital. Meli targeted Mr. Connor and

his extensive network, including Plaintiff, and kept them enticed with Advance's partnership with

- 10 -



10 of 35

DTI so that, when the time was right, he could count on Plaintiff and others to invest in whatever

ticket scheme he might be organizing and pitching at that time.

49. Mr. Connor's confidence in any investment opportunity offered by Advance/DTI

continued to grow. With the involvement of DTI, a market leader in the live ticket industry, and

with a substantial investment into the company group by private equity firm CVC (known for

managing billions of dollars), Meli convinced investors such as Plaintiff that there was little risk

in investing in proposals offered by DTI and Advance.

50. On or about September 9, 2016, DTI filed Form D with the U.S. Securities and

Exchange Commission in connection with its endeavor to seek and raise capital. (See a copy of

DTI's Form D filing attached as Exhibit D to the TGT 4th Am. Comp.).) The Form D filing listed

Defendant Meli as a Director of DTI.

51. DTI's Form D filing lent further support to Plaintiff's confidence in Meli's

representations. In Mr. Connor's mind, the Form D filing fully supported all of Meli's previous

representations that he would become a top executive and Director who was "in charge ofDTI,"

and would organize various live event ticket investment opportunities, as the head of its

Entertainment Division.

52. Unknown to Mr. Connor, however, DTI had returned the Good Faith Deposit under

the LOI to Meli back on August 26, 2016. Meli's plan had worked: while he never intended for

Advance to purchase any part of DTI for that amount of money, Meli caused DTI and Advance to

enter into the LOI to induce others such as CVC into believing that someone (Advance) was

actually willing to pay $63 Million to acquire DTI. This, in effect, immediately raised the apparent

value of DTI inothers'

eyes, and was certainly an influencing factor in CVC's decision to invest

in DTI.

- 11 -



11 of 35

The CVC Investment in DTI Closes

53. On or about October 11, 2016, CVC Growth Fund officially closed the final

transaction and invested $75 Million to purchase a substantial ownership stake in DTI. (See a

CVC press release that describes the investment attached as Exhibit E to the TGT 4th Am. Comp.)

54. Now that CVC had invested in the Advance/DTI company group, Mr. Connor was

very confident regarding the success, security and legitimacy of any investment placed with DTI

and its Entertainment Division affiliate, Advance.

Meli Begins Offering"Investments" Through DTI

55. During the closing period and then after the deal closed, Meli began offering new

ticket investments through the auspices of his new position as co-CEO, Director, part owner and

Head of the Entertainment Division at DTI.

56. Meli explained that his new company DTI allowed him to have an immediate

platform by which the advance block tickets for the shows in questions (i.e., Hamilton, Harry

Potter, etc.) could be easily sold while investors could monitor their investments and later ticket

sales using DTI's online platform.

57. Indeed, Meli's role was to organize lucrative ticket deals, such as the purported

Hamilton block ticket opportunity in which DTI already had an interest, using the DTI platform to

resell those tickets into the secondary market.

Meli Offers Mr. Connor the Fraudulent Harry Potter

Investment Opportunity through DTI/Advance

58. In the late fall of 2016, Meli approached Mr. Connor, regarding an entertainment

investment opportunity involving a deal that Defendants DTI and Advance had secured with

Ambassador Theatre Group Ltd. ("ATG"), a major international theatre organization, for the

anticipated Broadway debut of the play Harry Potter and the Cursed Child.

- 12 -



12 of 35

59. As Meli had"baited"

Mr. Connor over the past few months with false

representations regarding the successes of alleged investors in Meli's various ticket deals and the

highly profitable future of DTI/Advance, Mr. Connor became very interested in this alleged

opportunity with ATG.

60. Defendant Meli, a top executive, Director and Head of the Entertainment Division

of DTI, shared with Mr. Connor that DTI and Advance had secured the right to purchase $62.5

Million worth of advance block tickets for the Broadway debut of the new Harry Potter play,

which was already a huge success in London.

61. The alleged agreement with ATG involved DTI/Advance's sale of those Harry

Potter tickets in the secondary market over a staggered period of time, which would give investors

in the deal a likely very lucrative return, given how successful the play already was.

62. Meli, through the auspices of DTI and Advance, estimated to Mr. Connor that

investors could expect to receive a return of three to five times their original investment. This

sounded reasonable to Mr. Connor, given that tickets to the Broadway hit Hamilton were then

selling for even larger multiples of the box office price, and Harry Potter was already a huge

success in London.

63. Mr. Connor and his fellow investors in the TGT Plaintiff entity chose to invest in

the ATG Agreement that DTI and Advance had allegedly secured with ATG relying on Meli's

considerable experience in the live entertainment ticket industry, and more importantly, relying on

Meli's representation of participation in the deal by DTI, of which CVC held the majority

ownership interest.

64. DTI's prominence in the secondary ticket market, and the fact that it had been

backed and was controlled by prominent private equity firms, lent further support to Mr. Connor's

- 13 -



13 of 35

belief that the Harry Potter investment was a legitimate opportunity for the TGT Plaintiff and

Plaintiff in this case.

65. As Mr. Connor further investigated the Harry Potter opportunity, Mr. Connor, on

behalf of the Plaintiff, requested to see a copy of the alleged ATG Agreement that DTI and its

affiliate, Advance, had procured with ATG.

66. The fraudulent ATG Agreement was drafted by Defendant Molner, who drafted

many other fraudulent agreemêñts for Meli as well. Molner willingly participated and conspired

with Meli because Meli funneled financial resources to him that he desperately needed.

67. Indeed, Molner even attempted to solicit and bring in other investor-victims to

participate in altcrñative fraudulent Harry Potter investment deals purportedly organized by Meli.

Molner knew the deals were fraudulent, because he had yet to even draft full terms of the fraudulent

agreement with ATG that would"document"

these fraudulent deals. Once again, Molner's desire

for a bigger "piece of theaction,"

given his own need for money, ruled the day.

68. Meli provided a copy of the ATG Agreemeñt, drafted by Molner, which was

purportedly entered into between ATG and DTI's affiliate and minority owner, Advance, and gave

Advance the right to purchase two hundred fifty thousand (250,000) tickets to the 2017-2018 two-

part Broadway performances of Harry Potter and the Cursed Child with a face value of $250 per

ticket. The ATG Agreement specifically provided that Advance and DTI would then re-sell these

Harry Potter tickets through DTI's online platform. Plaintiff was then promised it would

ultimately receive a portion of the profits from every ticket sold by Advance/DTI. (See the ATG

Agreement received from Defendants attached as Exhibit F to the TGT 4th Am. Comp.).

69. The ATG Agreement itself describes DTI as affiliated with Advance because it

states that Advance would assign the tickets to DTI which would sell them in the secondary market

- 14 -



14 of 35

through its affiliated online platform. Meli was a co-CEO, Director and the head of DTI's

Entertainment Division. DTI was also a prominent player in the secondary ticket market and had

just received a $75 Million investment from two high-profile private equity firms, which

presumably performed extensive due diligence on the company group and were allowing Advance

to hold a minority interest in DTI.

70. Moreover, the funding agreement governing Plaintiff's investment that was

prepared by Meli and Molner specifically refers to DTI as an Advance"affiliate"

in describing

DTI's role in the transaction. (See "Hodes FundingAgreement"

attached hereto as Exhibit A).

71. As Plaintiff would soon discover, however, the ATG Agreement was entirely

fabricated by Defendants Meli and Molner. Neither Advance, nor Meli had any such agreement

with ATG regarding the sale of tickets to the Broadway performances of Harry Potter and the

Cursed Child.

72. Molner conspired with Meli in the fraudulent scheme and drafted the ATG

Agreement, knowing full well that there was no actual deal in place between ATG, Advance and

DTI. Molner drafted many other fraudulent agreements for Meli knowing that the"deals"

were

non-existent and even solicited investors for such non-existent deals, so that he could obtain

additional compensation from Meli.

73. In Meli's endeavor to secure investments from Plaintiff and the TGT Plaintiff, he

made countless fraudulent representations as to the non-existent ATG Agreement. These

fraudulent representations continued through December 2016 and January 2017, culminating in

Plaintiff's ultimate decision in January 2017 to transfer to Advance a total of $300,000 - and the

TGT Plaintiff's contemporaneous decision to transfer to Advance $7,860,000 - which Plaintiff

- 15 -



15 of 35

believed would be used by Meli, Advance and DTI to purchase blocks of tickets for the hit musical

play Harry Potter.

74. Some of the most egregious examples of Meli's fraudulent representations during

this time period include:

(i) On December 13, 2016, Mr. Connor, referring to the success of the Harry

Potter show in the United Kingdom, asks Defendant Meli: "Based on the

response in London, it would be a safe bet that the $62M block sells out

QUICKLY."Meli responds: "Of

course."(See text messages from

Defendant Meli to Mr. Connor attached at Exhibit G to TGT 4th Am. Comp.)

(ii) On December 15, 2016, Mr. Connor asks Defendant Meli: "What do you

think the return will be?3x?"

Meli responds: "Just call it an easy 2+.

[Between] us it looks like it can be 5-6 [times thereturn][.]"

(See text

messages from Defendant Meli to Mr. Connor attached as Exhibit H to TGT

4th Am. Comp.)

(iii) On December 16, 2016, Mr. Connor asks Meli how investors would be able

to monitor their investment. Meli responds that investors would receive a

"[c]omputer breakdown. Your portion of the money goes into a dedicated

account foryou[.]"

Meli represents that investors would "[o]fcourse"

have

access to sales proceeds as they are deposited into the dedicated account

because, according to Meli, "[i]t is yourmoney."

(See text messages from

Defendant Meli to Mr. Connor attached as Exhibit I to TGT 4th Am. Comp.)

(iv) On December 18, 2016, Mr. Connor asks Meli: "Advance assigns Tix to

DTI to distribute/sell, correct? Advanced [sic] owns part of DTI,correct?"

- 16 -



16 of 35

Meli responds: "Yes and advance owns 22% ofDTI"

(See text messages

from Defendant Meli to Mr. Connor attached as Exhibit J to TGT 4th Am.

Comp.) Given that the LOI signed by Advance and DTI contemplated

Advance's purchase of DTI in its entirety, and that the CVC Proposal also

presupposed that Advance was at least a part owner of DTI, Mr. Connor had

no reason to doubt that Advance owned a minority 22% ownership interest

in DTI.

(v) On December 19, 2016, this time in an email, Defendant Meli again

represents that DTI is affiliated with the purported ATG Agreement, stating

that the theater tickets would be "issued toAdvance"

which would then

"assign [the tickets] toDTI."

In this same email, Meli represents that there

is "limited creditrisk"

since any such risk would relate only to Advance and

DTI, which companies "had CVC capital partners invest$75mm."

Defendant Meli also again touts DTI's success in the live event ticket

industry, stating that "DTI sell [sic] over $500mm in tickets Annually[sic]."

(See an email from Defendant Meli to Mr. Connor attached as Exhibit K to

TGT 4th Am. Comp.)

(vi) On December 20, 2016, Mr. Connor asks Meli for a summary of how its

investment would be used. Meli responds:

We assign you a prorated percentage of tickets purchased. Tickets

get sold thru [sic] DTI. You provide a bank account that we make .

. . deposits in regularly until all the tickets are sold. You are the onlypeople that have access to withdrawing the money and can access it

all the time. You will have portal access to the [Harry Potter] ticket

sales that you can access and monitor the sales in real time.

- 17 -



17 of 35

Mr. Connor asks Meli whether "AE/DTI are bidding on the$62.5mm"

and

whether "the block is being purchased directly from the producers of the

show[.]"With elaborate yet completely fraudulentdetail, Meli responds:

Yes AE/DTI bidding $62.5mm. Yes being bought directly from

producer and box office. No other bidders . . . $250 a ticket is ticket

price . . . Mark up will be roughly $100 dollars per ticket . . .

Expected sales are going to be 3-4x face [value] . . . The secondarymarket i.e. Resale [sic] market defmitely staggers pricing which is

why we will not sell all of our tickets immediately and bleed tix [sic]into the market place over time maximizing on profits.

Mr. Connor questions Defendant Meli's representation as to the amount of

return the TGT Plaintiff would see on its investment, and Meli responds in

an email to Mr. Connor outlining the math involved in his calculation. (See

emails between Mr. Connor and Defendant Meli attached as Exhibit L to

TGT 4th Am. Comp.)

(vii) Later on December 20, 2016, Mr. Connor asks Meli: "You are the reason

why AE/DTI got a shot at this block, correct? How much are you personally

doing[investing]?"

Meli responds: "Yes I am the reason we are getting this

and I am doing [investing] $5mm personally."(See emails between Mr.

Connor and Defendant Meli attached as Exhibit M to TGT 4th Am. Comp.)

(viii) On December 31, 2016, Meli again makes fraudulent representations as to

the fabricated agreement with ATG. Mr. Connor asks Meli: "The $62.5M

is purchasing represents 20% of the house[?] Does ATG keep the rest of

the 80% and sell direct to consumer or do they break off other chunks for

[Advance]sales?"

Meli responds: "80% of the house goes on sale and we

help with thattoo."

Plaintiff responds: "So 100% of the house goes on sale

mid-June through Deceinber. 20% [is] owned and sold/distributed by

- 18 -



18 of 35

AE/DTI and 80% is owned/sold by ATG.Correct?"

(See text messages

from Defendant Meli to Mr. Connor attached as Exhibit N to TGT 4th Am.

Comp.)

75. On or about January 4, 2017, Meli traveled to Chicago, Illinois to meet with a

majority of Mr. Connor's members/investors and discuss the investment opportunity Meli was

presenting to the group-whereby they could invest in the AE/DTI deal, and make what Meli

promised to be a very large return.

76. At the January 4, 2017 meeting, Defendant Meli repeated to the attending investors

each of the false misrepresentations previously made, including that Advance was the

Entertainment Division affiliate of DTI which owned 22% of DTI; that Advance partnered with

DTI with respect to the ATG Agreement to secure the Harry Potter tickets, an "AE/DTI deal";

and that tickets would be "issued toAdvance"

who would then "assign them toDTI."

77. Following the meeting on January 4, 2017, the TGT Plaintiff investment entity was

formed on or about January 6, 2017 with the Minnesota Secretary of State, in order to provide its

members a receptacle in which to combine their funds to place the investment with Advance.

78. Mr. Connor asked Meli: "Question: DTI gets 6% rip [return] on gross sales. So

technically, we would break even at $371 ($350 x 6%).Correct?"

Meli responds:"Correct"

(See

text messages from Defendant Meli to Mr. Connor attached as Exhibit O toTGT 4th Am. Comp.)

79. On January 9, 2017, Defendant Meli again falsely represented that the ATG

Agreement investment opportunity was a DTI-related deal by stating that Defendants Advance

and DTI had a separate agreement in place with respect to the ATG Agreement. Specifically,

Defendant Meli said that, while he could "not share the AE/DTIagreement"

with respect to the

ATG investment opportunity, he could still"rep"

to it.

- 19 -



19 of 35

80. On January 11, 2017, Mr. Connor asks Meli: "[D]o you have an [sic] fully executed

copy of the ATG agreement?"Meli responds: "yes sir. I have hard copy [sic] need to

scan,"

referring to a hard copy original of the fully-executed ATG Agreement (See text messages from

Defendant Meli to Mr. Connor attached hereto as Exhibit P to TGT 4th Am. Comp.).) Of course,

no legitimate document existed; the fully-executed ATG Agreement that Mr. Connor received was

entirely fraudulent, as Plaintiff would soon discover.

Plaintiff Invests in the "AE/DTI"Harry Potter

Investment and Later Uncovers Defendants' Fraudulent Scheme

81. On or about December 30, 2016, Mr. Connor approached Vincent Hodes, for whose

family Plaintiff was established, about the purported investment opportunity with Meli and

Advance. Mr. Hodes is a close friend and business partner of Mr. Connor. Also, Mr. Hodes

understood that Mr. Connor was friendly with Meli and had known him since they were children.

82. As a result of Defendant Meli's fraudulent representations to Mr. Connor, who

repeated them to Mr. Hodes at Meli's request to secure additional money for the fraudulent

scheme, Plaintiff entered into the Hodes Funding Agreemeñt, dated January 1, 2017 with Advance,

which was drafted by co-conspirator Molner, and signed by Meli. (See Exhibit A.) The Funding

Agreement was premised on the underlying fraudulent and fabricated ATG Agreement.

83. Plaintiff invested a total of $300,000 with Advance, which was made on or about

January 13, 2017 through a wire transfer to Defendant Advance's BoA/Merrill Lynch Account in

New York, New York. Meli specifically represented that Plaintiff would send its ticket investment

funds with the understanding that the funds would be in a dedicated account available only to

Plaintiff such that Plaintiff could monitor both the funds and the subsequent ticket purchases at all

times.

- 20 -



20 of 35

84. To Plaintiff's knowledge, Mr. Connor was unaware that Defendant Meli's various

representations were false.

85. On or about January 26, 2017, Mr. Connor informed Vincent Hodes and Plaintiff

discovered that Meli was indicted on multiple criminal charges for securities and wire fraud. The

indictment included allegations that Meli had made false representations that he had entered into

a separate agreement that provided Advance the right to purchase tickets in advance to the

Broadway show, Hamilton, that could then be resold for a profit. Defendant Meli sold this alleged

investment opportunity to a different set of investors.

86. Mr. Connor contacted Meli in an effort to find out what was happening with the

investment because the news stories described a very similar investment scheme to what Plaintiff

had been offered-the only major difference being the substitution of Harry Potter and the Cursed

Child for Hamilton.

87. Defendant Meli kept indicating he had meetings to attend, so he could not follow

up with Mr. Connor, other than to proclaim he was innocent and would fight the charges.

88. As the news stories continued to grow, Mr. Connor demanded the return of the

monies that Plaintiff and the TGT Plaintiff had invested pursuant to fraudulent offerings in their

respective Funding Agreements.

89. On January 27, 2017, Meli responded that he could not return Plaintiff's investment

as his accounts were frozen.

90. Since the representation of Defendant Meli on January 27, 2017, Plaintiff

discovered that it was not until Monday, January 30, 2017, at 12:05 p.m. that the United States

District Court for the Southern District of New York issued a Temporary Restraining Order

- 21 -



21 of 35

freezing the accounts of Defendants and, in the interim, Meli continued to transfer money out of

the account. (See a copy of the TRO attached as Exhibit R to TGT 4th Am. Comp.)

91. On February 3, 2017, ATG confirmed to the Plaintiff-through an email to Mr.

Connor-that ATG had "noknowledge"

of the purported contract between Defendant Advance

and ATG and, in fact, the international theatre organization had never had any business dealings

with Defendant Meli or Defendant Advance. (See a copy of this email attached as Exhibit S to

TGT 4th Am. Comp.)

92. Defendants Advance Meli, and Molner have provided no evidence to Plaintiff that

Plaintiff's $300,000 has been used to fund the alleged ATG Agreement, or that any of the

representations contained in the Hodes Funding Agreemeñt or the ATG Agreement were actually

true.

Plaintiff's Investment was Transferred to Defendants' Acce,üñts

93. The TGT Plaintiff subpoenaed Merrill Lynch for copies of Defendant Advance's

bank statements in order to determine whether its funds and the funds that Plaintiff wired were still

present in Advance's account. In reviewing the bank statements received reveal that within days

- and in some instances on the same day- after Plaintiff and the TGT Plaintiff's wire transfers

arrived in Defendant Advance's account, Advance wired out of the Merrill Lynch account almost

the entirety of Plaintiff's $300,000 and the TGT Plaintiff's $7,860,000 to third parties. These

transfers include:

(i) 1/19/17: Advance wired $600,000 to Reset Partners LLC

(ii) 1/19/17: Advance wired $2,000,000 to New Amsterdam AE, LLC

(iii) 1/19/17: Advance wired $250,000 to Karl Mikael Andren

(iv) 1/19/17: Advance wired $1,805,000 to Advance II

(v) 1/19/17: Advance wired $225,000 to 127 Holdings

- 22 -



22 of 35

(vi) 1/20/17: Advance wired $250,000 to Harsh Padia

(vii) 1/20/17: Advance wired $125,000 to MXCU Holdings, LLC

(viii) 1/20/17: Advance wired $15,000 to Richard Notar

(ix) 1/20/17: Advance wired $500,000 to Matthew P. Smith

(x) 1/23/17: Advance wired $28,064.55 to Michael R. Cardonick

(xi) 1/23/17: Advance wired $150,000 to Material Good NY

(xii) 1/24/17: Advance wired $1,000,000 to an account maintained by MostlyDune Holdings, LLC at Pershing, LLC, a clearing broker

(xiii) 1/26/17: Advance wired $1,250,000 to Kid Shelleen, LLC

94. The TGT Plaintiff also subpoenaed a number of other banks for bank records,

which documents served as the basis for the wire transfers described herein.

95. In total, in the few days after Plaintiff and the TGT Plaintiff's investment in Meli's

fraudulent scheme, Meli wired $3.35 Million out of the account to Defendants Reset Partners,

Padia, Kid Shelleen, Andren, and Liebman (through Mostly Dune Holdings).

96. Plaintiff was also shocked to learn that on January 26, 2017, $450,000 of the funds

had been wired to Defendant Meli's defense counsel, Kasowitz, Benson, Torres & Friedman LLP,

to fund their retainer for his criminal and civil defense. Plaintiff learned that Meli indirectly wired

more of Plaintiff's funds ($235,000) to the Kasowitz law firm by transferring the money to 127

Holdings, which then wired the additional funds to Kasowitz.

97. Because Plaintiff, TGT Plaintiff and three other plaintiffs in related actions were

the last investors in Meli's fraudulent scheme, the subsequent transfers toDefendants'

accounts

are clearly identifiable as their money.

98. In fact, in United States v. Meli, 17-cr-00127, SDNY, the Government's crimiñal

case against Meli for fraud, FBI Special Agent Sean Sweeney submitted a Declaration in Support

of the Government's Preliminary Order of Forfeiture that explaiñêd Meli's fraudulent scheme and

- 23 -



23 of 35

tracing Plaintiff's money to various purchases and the above referenced wire transfers. Because

the accounts had negative balances prior to the Plaintiff's January 2017 transfers, Agent Sweeney

was able to determine which three victims the $10 Million transferred in mid to late January 2017

belonged to (the "related action plaintiffs") and to whom the $10 Million was later transferred. Of

this $10 Million, "no significant portion . . . was used to purchasetickets."

Instead, Plaintiff's

money was used to pay back previous investors, in furtherance of Meli's Ponzi scheme. (See

Sweeney Declaration attached as Exhibit T to TGT 4th Am. Comp.)

99. Therefore, it is without a doubt that the money transferred to the Defendants Reset

Partners, Padia, Mostly Dune Holdings, Liebman, Andren and Kid Shelleen belongs to Plaintiff

and the related action plaintiffs and must be returned.

100. Plaintiff, TGT Plaintiff, and the three other victims whose money was traced to

Defendants'accounts, have sent letters to Defendants Reset Partners, Padia, Lichmañ, Kid

Shelleen and Andren explaining that the wire transfers they received from Meli's Advance account

in January 2017 were stolen from the Plaintiff and the related action plaintiffs and that the funds

should be returned to Plaintiff, one of the rightful owners. (See demand letters sent to Defendants

attached as Exhibit U to TGT 4th Am. Comp.)

101. The Defendants wrongfully refused to return the money and continue to maintain

possession of money known not to be theirs, thus enriching themselves at the expense of the

Plaintiff and the related action plaintiffs.

102. Further, in two instances, Defendants Reset Partners and Liebman not only refused

to return the money, but also attempted to threaten and intimidate Plaintiff by saying that they had

notified the United States Attorney's Office for the Southern District of New York of Plaintiff's

- 24 -



24 of 35

attempts to regain possession of its own money. (See response letters from counsel for Reset

Partners and Liebman attached as Exhibits V and W to TGT 4th Am. Comp.)

Meli's Subseÿ üeñt Guilty Plea. Senteñciñg and Restitution and Forfeiture Orders

103. Meli was indicted for several counts of federal securities fraud on January 25, 2017

and was arrested two days later. On October 31, 2017, Meli pled guilty to felony securities fraud

in United States v. Meli, 17-cr-00127, SDNY.

104. During the course of the criminal proceedings, it was discovered that through his

Ponzi scheme, Meli defrauded over 130 investors out of approximately $97 Million and that Meli

used this money to purchase a variety of expensive trips, houses, cars, jewelry and meals, among

other things, for himself and his family members.

105. At Meli's sentencing hearing on April 3, 2018, Mr. Connor was invited to make a

victim impact statement. The court found his statement to be"eloquent"

and persuasive as Meli

was subsequently sentenced to 78 months imprisonment.

106. The court also noted that "[i]f ever there was a case that could be expected to

generate some general deterreñce, it is one likethis"

and that "Mr. Meli may well need individual

deterrence in light of the many different characterization of his'mistakes.'"

(See transcript of

sentencing hearing attached as Exhibit X to TGT 4th Am. Comp.)

107. On June 21, 2018, Judge Wood entered an Order of Restitution directing Meli to

pay restitution to the victims of his fraudulent scheme in the amount of $56,037,924.28. (See

Restitution Order attached as Exhibit Y to TGT 4th Am. Comp.)

108. On February 5, 2019, Judge Wood entered a Final Order of Forfeiture against Meli

and Advance's rernaiñiñg assets, which are the proceeds of the fraudulent scheme as amended on

March 6, 2019. The U.S.Attorneys'

Office will use these funds for victim restitution. The amount

- 25 -



25 of 35

of funds that will be available for victim restitution pursuant to this Order will amount to only a

small fraction of the total amount of damages that Meli caused to his victims, as reflected in the

Restitution Order. (See Forfeiture Orders attached as Exhibit Z to the TGT 4th Am. Comp.)

Moiner's Repeated Involvement in Meli's Fraudulent Scheme

109. The ATG Agreement that Molner drafted for Meli to tout to potential investors was

not the first fake ticket deal with which Molner was involved. In fact, the ATG Agreement was

only one of many fake agreements that Molner drafted to induce investment from potential

victims.2

110. Molner was well aware that the agreements that he was drafting for Meli were not

based on any real negotiations or terms. For instance, Meli instructed Molner to "lookup"

basic

information about the counter-party to the agreement, which clearly would have been in place

already if these were legitimate agreements.

111. Additionally, Molner was simply recycling old contracts to tout before investors by

altering party names and terms as needed to fit their various fraudulent purposes. Molner tailored

each agreement to the individual preferences of the targeted investor, rather than base the contract

on any real negotiated terms, to induce reliance. For example, in an exchange between Meli and

Molner about a Funding Agreement for Hamilton, Molner says that "[he] needs to get his [prefs]

on governance provisions for the operatingagrccment."

(See email attached as Exhibit AA to TGT

4th Am. Comp.)

2 Of note, Molner is the subject of another lawsuit in New York Supreme Court related to his solicitation of other

investors into a parallel fraudulent scheme organized by Meli iñvülving a fake ticket resale agreement for theartist Adele.

- 26 -



26 of 35

112. Further, Molner blatantly fabricated multiple agreemeñts at Meli's discretion. One

fake purchase agreement was "revised per [Meli's]request"

and another was "the best [Molner]

could do on shortnotice."

(See emails attached as Exhibits BB and CC to TGT 4th Am. Comp.)

113. It is clear that Molner knew that these agreements were fraudulent as Meli and

Molner invented terms to these agreements together to induce more victims to invest into the Ponzi

scheme.

114. Not only did Molner perpetrate Meli's fraud by drafting fake agreements, he was

also active in soliciting investors. Molner approached potential investors on his own and provided

Meli with detailed lists of interested investors. (See emails attached as Exhibit DD to TGT 4th

Am. Comp.)

115. Indeed, Molner solicited those investors for deals he knew didn't exist - because

he had yet to draft the fraudulent contracts to document the deal.

FIRST CAUSE OF ACTION

(Fraud against Defendants Meli and Advance)

116. Plaintiff repeats and realleges the prior paragraphs as if fully set forth

herein1 through 115 above.

117. Defendants Meli and Advance committed fraud against Plaintiff by falsely

representing the investment opportunity in the Broadway Harry Potter play and their contract with

ATG. In fact, Meli (through Molner) fabricated the ATG Agreement and did not invest the

Plaintiff's money, but used it forDefendants' own benefit.

118. Meli knew that the material representations and documents presented to Plaintiff to

obtain Plaintiff's investment were false.

- 27 -



27 of 35

119. Defendants Meli and Advance knew that Plaintiff was relying on the material

representations and documents presented in agreeing to enter into the Hodes Funding Agreement

put forth herein with Defendants Meli and Advance.

120. Had Defendant Meli not made the false representations put forth herein, Plaintiff

would not have made the investment and would not have entered into the Funding Agreemcñt.

121. Plaintiff reasonably relied on Defendant Meli and Defendant Advance's

misrepresentations.

122. As a direct and proximate result of the fraud committed by Defendants, Plaintiff

has suffered and/or incurred economic damages in the amount of $300,000, plus attorney fees and

costs for having to bring this action.

123. Moreover, Plaintiff seeks for the Court to impose punitive damages on the

Defendants Meli and Advance. Defendants are engaged in criminal and fraudulent behavior and

the present fraud perpetrated against Plaintiff is part of multiple fraudulent schemes of this type.

As Judge Wood noted in her sentencing of Meli, Defendants will continue to engage in such

reprehensible conduct until being deterred in the form of the most severe civil and criminal

remedies available.

124. Plaintiff therefore requests that the Court award punitive damages against the

Defendants in the amount of $1,000,000 for their fraudulent conduct.

SECOND CAUSE OF ACTION

LAid_ing and Abetting Fraud against Malacr)

125. Plaintiff repeats and realleges the prior paragraphs 1 through 124 above.

126. Defendants Meli and Advance committed fraud against Plaintiff by falsely

representing the investment opportunity in the Broadway Harry Potter play and their contract with

- 28 -



28 of 35

ATG. In fact, Defendant Meli pled guilty to federal securities fraud in United States v. Meli, 17-

cr-00127, SDNY.

127. Defendant Molner fabricated the ATG Agreement that Plaintiff relied upon in

making its investment decision. Defendant Molner had actual knowledge of the underlying fraud

when he drafted the fraudulent ATG Agreement for Meli, because he knew that the agreement was

a complete fabrication.

128. Defendant Molner also drafted other agreements for Meli knowing that the"deals"

were non-existent. Molner recycled old contracts to tout before investors by altering party names

and terms as needed to fit Meli and Advance's fraudulent purposes.

129. Defendant Molner substantially assisted in the fraudulent scheme not only by

drafting the fabricated agreements, but also by attempting to solicit other victims to invest in

various fraudulent ticket deals. Molner knew that the deals were fraudulent, because he had not

drafted any legitimate contracts documenting the terms.

130. Molner willingly drafted the fraudulent agreements for Meli and solicited investors

for deals he knew did not exist in exchange for financial compensation that he desperately needed.

131. As a result of Defendant Molner's conduct, Plaintiff has suffered and/or incurred

economic damages in the amount of $300,000 plus attorney fees and costs for having to bring this

action.

132. Plaintiff also requests an award of punitive damages in the amount of $1,000,000,

which would deter such unacceptable and morally reprehensible conduct.

THIRD CAUSE OF ACTION

(Conversion anninst all Defendants except Moiner)

133. Plaintiff repeats and realleges the prior paragraphs as if fully set forth herein1

through 132 above.

- 29 -



29 of 35

134. Meli and Advance have wrongfully taken the $300,000 invested by Plaintiff for the

sole purpose of purchasing ticket blocks through to the Hodes Funding Agreement referenced

herein. Meli and Advance converted the funds for their own benefit and use rather than using the

funds for their intended purpose.

135. In all, Plaintiff, the TGT Plaintiff and the related action plaintiffs wired

$10,660,000 to Advance's Merrill Lynch account for the sole purpose of purchasing tickets

pursuant to their respective F1mding Agreements, but Meli transferred the entire $10,660,000 out

of the account within days.

136. Of the $10,660,000 invested, a total of $3,350,000 was transferred to Defendants

Reset Partners, Harsh Padia, Mostly Dune Holdings and Jason Lichmañ, Kid Shelleen and Karl

Mikael Andren. Specifically, Reset Partners received $600,000, Harsh Padia received $250,000,

Mostly Dune Holdings and Jason Liebman received $1,000,000, Kid Shelleen received $1,250,000

and Karl Mikael Andren received $250,000.

137. Defendants refused Plaintiff, TGT Plaintiff and the related actionplaintiffs'

demand for the return of their stolen money and have continued their unlawful possession of the

converted funds.

138. The Defendants named in Paragraph 136 as recipients of the funds transferred out

of Advance's Merrill Lynch account have converted the referenced monies for their own benefit

and use by refusing to return the money to the Plaintiff, TGT Plaintiff and the related action

plaintiffs.

139.Defendants'

conversion of Plaintiff's money, in the amounts put forth above, has

deprived Plaintiff of its property byDefendants'

unauthorized act in assuming dominion, despite

Plaintiff's demand for its return.

- 30 -



30 of 35

140. As a direct and proximate result of the conversion committed by Defelidarits Meli

and Advance, Plaintiff has suffered and/or incurred economic damages in the amount of $300,000.

141. As a direct and proximate result of the conversion committed by Defendants Reset

Partners, Harsh Padia, Mostly Dune Holdings and Jason Lichmari, Kid Shelleen and Karl Mikael

Andren, Plaintiff, TGT Plaintiff and the related action plaintiffs have also suffered and/or incurred

economic damages in the amount of $600,000 as against Defendant Reset Partners, $250,000 as

against Defendant Harsh Padia, $1,000,000 as against Defendants Mostly Dune Holdings and

Jason Liebman, $1,250,000 as against Defendant Kid Shelleen, and $250,000 as agaiiist Defendant

Karl Mikael Andren.

FOURTH CAUSE OF ACTION

(Uniust Enrichmcat against all Defcadants except Moiner)

142. Plaintiff repeats and realleges the prior paragraphs as if fully set forth herein 1

through 141 above.

143. Defendant Advance entered into the Hodes Funding Agreement, which is a valid

and enforceable contract, whereby Advance and Meli agreed to utilize Plaintiff s funds to purchase

tickets to the Broadway performance of Harry Potter.

144. Plaintiff performed its obligations under the contract by wiring Advance $300,000.

in accordance with the Hodes Funding Agreement.

145. Defendant Advance breached the Hodes Funding Agrccmcnt by not using

Plaintiff s funds to purchase the Harry Potter tickets but instead for its own purposes (i.e. to pay

back prior victims of its Ponzi scheme).

146. As a result of Meli and Advance's breach of the Hodes Funding Agreement,

Plaintiff has been damaged

- 31 -



31 of 35

147. By reason of their wrongful taking of Plaintiff's $300,000, Defendants Meli and

Advance have been unjustly enriched at Plaintiff's expense in that they have directly received

money from Plaintiff as the result of fraud and otherwise unlawful conduct and that, in equity and

good conscience, they should be not be permitted to keep.

148. Plaintiff is therefore entitled to restitution from Defendants in the amount of

$300,000-the amount by which they have been unjustly enriched.

149. By reason of their wrongful detention of the Plaintiff and the related action

plaintiffs'stolen money, Defendants Reset Partners, Harsh Padia, Mostly Dune Holdings and

Jason Liebman, Kid Shelleen and Karl Mikael Andren have been unjustly enriched, at all of the

plaintiffs'expense, in that they were transferred stolen funds and have subsequently refused

demands that the funds be returned and that, in equity and good conscience, they should be not be

permitted to have used for their own financial benefit.

150. Plaintiff, TGT Plaintiff and the related action plaintiffs are therefore entitled to

restitution from Defendants Reset Partners, Harsh Padia, Mostly Dune Holdings and Jason

Liebman, Kid Shelleen and Karl Mikael Andren in the amounts by which they have been unjustly

enriched.

151. By reason of the foregoing, Plaintiff has sustained compensatory damages and have

been injured by Defendants Meli and Advance in an amount in excess of $300,000, and Plaintiff,

TGT Plaintiff and the related action plaintiffs have sustained compensatory damages and have

been injured by Defendants Reset Partners, Harsh Padia, Mostly Dune Holdings and Jason

Liebman, Kid Shelleen and Karl Mikael Andren in an amount in excess of $3,350,000.

FIFTH CAUSE OF ACTION

(Conspiracy to Cerr!± Fraud against Defendants Advance. Meli and Moiner)

- 32 -



32 of 35

152. Plaintiff repeats and realleges the prior paragraphs as if fully set forth herein 1

through 151 above.

153. Defendants Advance, Meli and Molner conspired in a corrupt common scheme

and/or purpose to defraud Plaintiff in the amount of $300,000, as pled in the First and Second

Causes of Action above.

154. Defendants Advance, Meli and Molner committed overt acts in furtherance of the

fraudulent scheme for a number of months leading up to Meli's indictment for securities fraud.

155. Defendants Advance, Meli and Molner also intentionally and willfully participated

in furtherance of the fraudulent scheme.

156. By reason of the conspiracy to commit fraud of Defendants Advance, Meli and

Molner, Plaintiff has been harmed in an amount of $300,000, which Plaintiff has demanded, but

has yet been unsuccessful in recovering from Defendants.

157. Plaintiff requests an award of punitive damages in the amount of $1,000,000.

PRAYER FOR RELIEF

WHEREFORE, Plaintiff requests that this Court enter judg:ncat in favor of Plaintiff

and against the Defendants as follows:

(i) Damages in the amount of $300,000 and all of Plaintiff's attorney fees

incurred in bringing this action against Defendants Advance and Meli;

(ii) Damages in the amount of $300,000, including interest and costs, incurred

in bringing this action against Defendant Reset Partners;

(iii) Damages in the amount of $250,000, including interest and costs, incurred

in bringing this action against Defendant Padia;

(iv) Damages in the amount of $300,000, including interest and costs, incurred

in bringing this action against Defendants Mostly Dune Holdings and

Liebman;

(v) Damages in the amount of $300,000, including interest and costs, incurred

in bringing this action against Defendant Kid Shelleen;

- 33 -



33 of 35

(vi) Damages in the amount of $250,000, including interest and costs, incurred

in bringing this action against Defendant Andren;

(vii) Plaintiff's costs and disbursements incurred herein;

(viii) Pre-judgment interest running from the date of Plaintiff's initial investment

for Defendants Meli and Advance;

(ix) Pre-judgment interest running from the date of the denial ofDefendants'

return of the funds for Defendants Reset Partners, Harsh Padia, MostlyDune Holdings, Jason Liebman, Kid Shelleen and Karl Mikael Andren;

(x) Punitive damages against Defendants Meli, Advance and Molner in the

amount of $1,000,000; and

(xi) Such further relief as the Court deems just and equitable.

DEMAND FOR TRIAL BY JURY

WHEREFORE, Plaintiff demands trial by jury on all counts so triable.

Dated: New York, New York

March 12, 2019

JOHN MURPHY & ASSOCIATES, P.C.

By:

John Murphy1450 Broadway,

39* Floor

New York, NY 10018

(646) 862-2012

[email protected]

Counsel for PlaintiffVincent V Hodes Family Irrevocable Trust

- 34 -



34 of 35

VERIFICATION

STATE OF NEW YORK )

) ss.:

COUNTY OF NEW YORK )

JOHN MURPHY, being duly sworn, deposes and says:

I am counsel for Plaintiff in this action. I submit this Verification pursuant to

CPLR 3020(d)(3). I have read the foregoing Verified Complaint, know the contents thereof, and,

based on my communications with my client and the documents provided by my client, state that

the same is true to my knowledge, except as to those matters therein alleged on information and

belief, and as to those matters, I believe them to be true.

This verification is made by me because my client is a foreign corporate entity.

JOHN MURPHY

Sworn to before me this12th

day of

March, 2019

Notary Public

ANDREW LlLLIS

NOTARY PUBLIC-STATE OF NEW YORK

No. 02L16309857

Quallfled in Queens County

my eernmisslan mmpiren August 98, 9918



35 of 35

2019 04:56 pm

Documents