FILED: NEW YORK COUNTY CLERK 03/15/2016 07:00 PM
`NYSCEF DOC. NO. 569
`
`INDEX NO. 600448/2006
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`RECEIVED NYSCEF: 03/15/2016
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`IN THE CIRCUIT COURT OF THE I ITH
`JUDICIAL CIRCUIT, IN AND FOR
`MIAMI-DADE COUNTY, FLORIDA
`
`GENERAL JURISDICTION DIVISION
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`CASE NO. 08-50688 CA 32
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`CDR CREANCES, S.A.S.,
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`Plaintiff,
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`v.
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`LEON COHEN et al.,
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`Defendants.
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`I
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`ORDER GRANTING MOTION TO STRIKE DEFENDANTS' PLEADINGS
`AND ENTERING DEFAULT BASED ON FRAUD ON THE COURT
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`THIS CAUSE came before the Court on October 1, 5 and 6, 2010, on plaintiff CDR
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`Creances, S.A.S.' ("CDR") Motion to Strike Pleadings and Enter Default Judgment Based on
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`Fraud on the Court ("Motion to Strike"). The Court, having reviewed the Motion, the
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`Oppositions thereto, the documents submitted by the parties and the testimony of the witnesses,
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`having heard argument from counsel and being otherwise duly advised in the premises, makes
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`the following findings of fact and conclusions of law:
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`Defendants Maurice Cohen, Sonia Cohen, Leon Cohen and Lea Cohen (collectively, the
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`"Cohens"), along with the defendant companies they control (the "Corporate Defendants"), 1
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`1 The "Corporate Defendants" are: Empire World Towers, LLC; Maclee Holdings, LLC; Maclee Express USA,
`LLC; Macless Express (Miami), LLC; Maclee Express International, LLC; Maclee Express Retail Network, LLC;
`Maclee Express Sales Center Southeast (Florida), LLC; Maclee Express Sales Center 001-20, LLC; Maclee Express
`Store 001-01, LLC; Maclee Express Manufacturing, LLC; Maclee Quarters USA, LLC; Maclee Quarters (Miami),
`LLC; Maclee Productions, LLC; Maclee Production Center 001-00, LLC; Maclee Music (USA), LLC; Maclee
`Developments, LLC; Maclee Central, LLC; Maclee Virtual Systems, LLC; American Leisure Resorts, Inc.;
`American Leisure Resorts of Florida, LLC; ALR Work Force & Management, LLC; American Creek Realty, LLC;
`American Dynamics, Inc.; Empire Ocean Residence Realty, LLC, f/k/a First Ocean Residences Realty, LLC;
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`I
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`

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`have engaged in a wide-ranging and orchestrated scheme to defraud this Court as well as the
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`court presiding over the related case brought by CDR against the Cohens in the Supreme Court
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`of New York, New York County (the "New York Action").2 The fraud was engineered by the
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`defendants, united in interest, with the specific intent to interfere with the judicial system's
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`ability impartially to adjudicate this matter by improperly influencing the Court and unfairly
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`hampering the presentation of CDR's claim. The Corporate Defendants include American
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`Leisure Resorts, Inc. ("ALR"), whose subsidiaries own six Florida real estate properties (the
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`"Florida Properties") that are the subject of CDR's equitable claims in this case. 3 CDR filed lis
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`pendens on each of the Florida Properties when it commenced this action.
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`Although this Court makes its own findings of fact based on the evidence before it, the
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`Court is mindful that Maurice and Leon Cohen were recently found guilty of a federal felony
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`under 18 U.S.C. § 371 of conspiracy to defraud the Internal Revenue Service and additional
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`felony counts under 26 U.S.C. § 7206(1) of filing false tax returns, after a multi-week trial by a
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`federal jury in the Southern District of Florida. See United States v. Cohen et al., Case No. 10-
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`60159-CR-ZLOCH (S.D. Fla. 2010). As discussed in greater detail below, the criminal
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`complaint is based on the same allegations CDR advances in this case, to wit: the Cohens' use of
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`a world-wide web of alter-ego entities to hide $33 million in cash received from the sale
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`proceeds of the New York Flatotel and the fruits of their use of that unreported income to further
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`Flatotel Sea Spa Palace, Inc.; The Hot Rod Factory (Miami), LLC; Knowledgeware, LLC; LC Harbor Realty, LLC;
`North Realty, LLC; Showtime Theatres of Florida, LLC; Villa del Mare Realty, LLC; White Hall Holdings USA
`Corp.; ABC World Investment, LLC; Marina Club, LLC.
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`2 CDR Creances, S.A.S. v. Maurice Cohen, et al., Index No. 109565/03, Index No. 600448/06; CDR Creances,
`S.A.S. v. Leon Cohen, et al., Index No. 600448/06; see also CDR Creances, S.A.S. v. First Hotels & Resorts
`Investments, Inc., et al., Index No. 650084/09.
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`3 The ALR subsidiaries which hold title to the six Florida Properties are: Empire World Towers, LLC; LC Harbor
`Realty, LLC; Villa del Mare Realty, LLC; North Realty, LLC; Empire Ocean Residence Realty, LLC; and
`Showtime Theatres of Florida, LLC. The real property is described with particularity in the Complaint.
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`2
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`

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`their wealth and income.
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`During the hearing on this Motion, the Court heard testimony from several witnesses who
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`had previously testified in the criminal case against Maurice and Leon Cohen, and received
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`extensive documentary evidence. The clear and convincing evidence proves that the defendants
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`engaged in a scheme to defraud the Court as well as CDR. To conceal their ownership in the
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`Corporate Defendants and other companies involved in the underlying fraud allegations, the
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`defendants: (i) falsified and forged documents, and then had ALR's corporate representative rely
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`on those documents as the basis for sworn testimony in this case; (ii) held secret meetings in
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`Paris, France with material witnesses, gave them typed scripts with false answers to anticipated
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`deposition questions, coerced them, and promised financial reward in return for false testimony;
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`(iii) lied under oath regarding their ownership and control over ALR and other corporate entities;
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`and (iv) failed to produce documents in discovery (notwithstanding three court orders requiring
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`them do so) in which Maurice and Leon Cohen admitted ownership of ALR.
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`In entering this Order, the Court makes the following Findings of Fact and Conclusions
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`of Law, and for the reasons discussed below, the Motion is GRANTED.
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`I.
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`PROCEDURAL HISTORY AND FACTUAL BACKGROUND
`
`The Pleadings
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`On September 2, 2008, CDR, which is an instrumentality of the Republic of France, filed
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`a four count complaint, asserting claims for: (1) temporary injunction based on a prior court
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`order in the New York Action, (2) permanent injunction based on fraudulent transfers, (3) a
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`constructive trust on the Florida Properties, and (4) an equitable lien on the Florida Properties.
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`The Complaint incorporates the New York Action, and the allegations of the underlying fraud
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`are the same. See Compl. ~~1-3, 30-34, 49, 51-59, and 63. The principal difference between the
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`3
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`

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`New York Action and the instant case is that the current action seeks equitable remedies
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`specifically directed towards the Florida Properties,4 as well as other assets owned by other
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`Florida entities owned and controlled by the Cohens.
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`In both cases,5 CDR alleges a fraud arising from a loan made by CDR's predecessor,
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`Societe de Banque Occidentale ("SDBO") to a company controlled by the Cohens known as
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`Euro-American Lodging Corporation ("EALC"), ostensibly for the purpose of purchasing and
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`renovating a New York City hotel - the Flatotel. CDR alleges that the Cohens did not use all of
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`the funds from the loan for its intended purpose. Instead, once the loan proceeds were in hand,
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`the Cohens systematically began to divert hotel revenue into their own pockets through alter-ego
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`entities they owned and controlled.
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`The theft of funds continued unabated through at least February 14, 2000, when the
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`Cohens received $33 million from the sale of the New York Flatotel "by wire to a Swiss bank
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`account of Blue Ocean Finance, Ltd. ("Blue Ocean"), a Panamanian shell company controlled by
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`the Cohen Defendants." See Compl. if26(d). These proceeds were subsequently used to
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`purchase, maintain, and/or satisfy mortgages on the Florida Properties, which properties are
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`owned through the Cohens' "alter egos, the corporate defendants they control, rather than in their
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`individual names." See Compl. if35.
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`On July 2, 2009, after this Court denied the defendants' motions to dismiss the
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`Complaint, Maurice, Sonia and Leon Cohen, filed their answer and affirmative defenses to the
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`4 The properties are situated in Miami-Dade County and have the following addresses: (1) 330 Biscayne Blvd.; (2)
`429 Lennox Ave.; (3) 1475 Collins Ave.; (4) 5930 North Bay Road; (5) 7213 Fisher Island Drive; and (6) 268 Park
`Drive.
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`5 The Court hereby incorporates Justice Tolub's description of the New York Action in CDR Creances, S.A.S. v.
`Maurice Cohen, et al., 2009 N.Y. Misc. LEXIS 6514 (N.Y. Sup. Ct., Nov. 24, 2009), aff'd in part and modified in
`part, 2010 N.Y. App. Div. LEXIS 7487 (N.Y. App. Div. 1st Dep't, Oct. 19, 2010).
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`4
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`

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`Complaint.6 The Corporate Defendants, with the exception of ABC World Investment, LLC and
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`Marina Club, LLC, also filed their answer and affirmative defenses that day. ABC World and
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`Marina Club, along with defendant Lea Cohen (the daughter of Maurice Cohen and sister of
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`Leon Cohen), had filed their answer and affirmative defenses a few days earlier on June 29,
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`2009.
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`In their answer and affirmative defenses, the Cohens denied, among other things, that: (i)
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`ALR and the other entities are alter egos of the Cohens; (ii) the Cohens and others engaged in a
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`conspiracy to avoid repayment of the SDBO loan by looting the assets, diluting the shares of
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`EALC, and selling the Flatotel without payment to CDR; (iii) the conspiracy to defraud included
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`a labyrinthine web of affiliated shell entities located in Florida, New York, Delaware,
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`Liechstentein, the British Virgin Islands, Panama, Quebec, and France; (iv) the Cohens own the
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`Florida Properties (including personal residences) through their alter egos, the Corporate
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`Defendants they control, rather than in their individual names; and (vii) the Cohens acquired and
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`or maintained the Florida Properties with fraudulently diverted proceeds.
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`Consistent with their denials in their answers, at their New York depositions, the Cohens
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`denied any ownership interest in ALR, Blue Ocean Finance Ltd. ("Blue Ocean"), Caribean
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`Business Funds, Inc. ("Caribean"), Compania Europamerica Hotelera ("Europamerica"},
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`Whitebury Shipping Ltd., f/k/a Whitebury Shipping Time Sharing Ltd. ("Whitebury"), and other
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`entities.
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`The Lis Pendens Hearings
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`The Court conducted evidentiary hearings on CDR's lis pendens in 2008 and 2009.
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`During these hearings, CDR submitted evidence of fraud showing that the Cohens engineered the
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`6 On September 20, 2010, this Court dismissed the Cohen Defendants' and Corporate Defendants' counterclaim,
`which they had also filed on July 2, 2009.
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`5
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`sale of the Flatotel, which ultimately resulted in Blue Ocean, the Panamanian company,
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`receiving $33 million in its HSBC Swiss bank account. CDR also presented evidence showing
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`that Maurice Cohen was the beneficial owner of Blue Ocean.
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`CDR demonstrated that Blue Ocean immediately transferred $32,014,000 to another
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`Panamanian company called Caribean the same day Blue Ocean received the Flatotel sale
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`proceeds. Caribean is a holding company that owns ALR; ALR and its LLC subsidiaries are the
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`record owners of the Florida Properties. The Court also received evidence that yet another
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`Panamanian company, Europamerica, subsequently transferred $26 million to open an account
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`for Whitebury, a British Virgin Islands company. Whitebury eventually paid off mortgages
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`executed by ALR on three of the six Florida properties (totaling approximately $22 million).
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`Prior to the lis pendens hearings in Florida, Maurice, Sonia, and Leon Cohen were
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`deposed in the New York Action over several days in late July 2009. The Cohens were aware
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`that the lis pendens hearing would proceed after their depositions, so they knew that their
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`deposition answers would affect this Court's determination whether to extend or discharge the lis
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`pendens. 7
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`Following the Cohens' depositions and the lis pendens hearings, the Cohen Defendants
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`responded to CDR's requests for admission. Consistent with their deposition testimony, the
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`Cohens denied ownership of ALR, Blue Ocean, Whitebury and the other entities that they owned
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`and controlled. See, e.g., Leon Cohen RFA Resp. 16 and Maurice Cohen RFA Resp. 20 (denial
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`of ownership of ALR), Maurice Cohen RF A Resp. 4 (Blue Ocean), Maurice Cohen RF A Resp. 5
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`(Whitebury), Maurice Cohen RF A Resp. 23 (ALR subsidiary First Ocean Estates Realty, LLC),
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`and Maurice Cohen and Leon Cohen RFA Resp. 1 (Caribean).
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`7 In addition to New York counsel, the Cohens were also represented by Justin Elegant, Esq. and William Petros,
`Esq., who were admitted pro hac vice in the New York litigation, the same attorneys who represent the Cohens in
`the action before this Court.
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`6
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`

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`The Cohens admitted that they had guaranteed tens of millions of dollars in loans to ALR
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`and its subsidiaries, including Maurice Cohen's guarantee of a $7 million loan from City
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`National Bank to American Creek Realty, LLC (RFA Resp. 21) and Leon Cohen's guarantees of
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`a $4 million loan from City National Bank to ALR for 5875 Collins Avenue (RFA Resp. 21),
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`nearly $10 million in loans from two banks to ALR for 5930 N. Bay Road (RFA Resp.22 and
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`24), a $1.3 million loan from Sterling Bank for 268 Park Drive (RFA Resp. 26), and a $16
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`million loan from Mellon United Bank for 330 Biscayne Boulevard (RF A Resp. 28).
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`The Cohens also admitted that they resided rent-free in posh multi-million dollar
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`residences owned by ALR's subsidiaries. Specifically, Maurice Cohen admitted that he resided
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`at 7213 Fisher Island Drive "as a result of his professional services provided to the property
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`owner" (RF A Resp. 25) and Leon Cohen admitted that he resided at 5930 N. Bay Road "as a
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`benefit of his employment" (RF A Resp. 30).
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`The Attempts to Discover the Beneficial Owners of ALR and the other entities
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`Since the inception of this case, the defendants have frustrated (and blocked through
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`illegal means) CDR's efforts to obtain evidence of ALR's beneficial owner(s) and the beneficial
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`owners of other entities discussed in the Complaint. During the last two years, CDR has filed
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`and this Court has granted three motions to compel requiring the defendants' production of
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`documents demonstrating the beneficial owners of the Corporate Defendants. Defendants have
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`failed to produce a single document with this information, particularly as it relates to the Florida
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`Properties.
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`To prove their allegations of beneficial ownership, CDR has been forced to obtain
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`documents from third parties (such as banks) and public records (such as filings with the City of
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`Miami and Miami Beach and documents introduced at the Cohens' federal criminal trial). The
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`7
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`documents that CDR has obtained from third parties and public records show that the Cohens are
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`the beneficial owners of the Corporate Defendants, as well as the other entities implicated in the
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`Complaint.
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`Frustrated by the defendants' failure to produce any beneficial ownership documents,
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`CDR filed a motion to vouch in September 2009. The motion to vouch requested that the
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`defendants' attorneys vouch for their authority to represent the Corporate Defendants by
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`identifying the beneficial owners of the Corporate Defendants. This Court reserved ruling on
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`CDR's request and, at defense counsel's invitation, ordered the deposition of Ana Perez (the
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`president of ALR and the managing member the Florida LLCs that own the Florida Properties).
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`Ms. Perez refused to answer any question relating to beneficial ownership, citing her Fifth
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`Amendment privilege against self-incrimination.
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`After Ms. Perez invoked her Fifth Amendment privilege, ALR (through Lea Cohen) hired
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`Sylvia Mergui. Ms. Mergui was aware that CDR was attempting to discover the natural persons
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`who beneficially owned ALR, yet she did not ask a single person about ALR's beneficial
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`owners.
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`Instead, she relied on the documents the Corporate Defendants produced in the
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`litigation (some of which were falsified, as discussed in greater detail below), and testified that
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`she could not identify ALR's beneficial owners.
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`After Ms. Perez and Ms. Mergui testified, the Court granted CDR's motion to vouch and
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`instructed the Corporate Defendants' counsel to identify the natural persons who beneficially
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`ownedALR.
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`The Guilty Verdicts in the Criminal Action
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`On October 6, 2010, a federal jury returned a guilty verdict against Maurice and Leon
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`Cohen. The indictment shares the same underlying allegations advanced by CDR in this case.
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`8
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`

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`For example, the indictment alleged that in February of 2000, Maurice Cohen realized $33
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`million in cash from the sale of the New York Flatotel, and transferred the proceeds to an
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`offshore bearer share corporation he owned named Blue Ocean. See Indictment, ml 9-10; 27-29;
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`cf Compl., if 26( d).
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`The indictment further alleged Maurice and Leon Cohen owned ALR, and used ALR to
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`conceal their ownership of assets and income. See Indictment, ifif 8, 13; cf, Compl., if 35
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`(alleging the Cohens own ALR and used ALR to hide the proceeds of the fraudulently obtained
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`funds). The United States Government also accused the Cohens of suborning perjury and
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`attempting to suborn perjury to hide their involvement with the sale of the Flatotel and the other
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`entities they controlled. See Indictment, ifif 41-42. 8
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`II.
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`FINDINGS OF FACT
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`Based on the evidence presented at the evidentiary hearing, the Court makes the
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`following findings of fact established by clear and convincing evidence:
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`THE CREATION OF FALSIFIED DOCUMENTS TO MISLEAD
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`1.
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`The ownership of Whitebury is material to these proceedings. Whitebury is a
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`British Virgin Islands bearer share company (distinguished from a registered share company).
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`2.
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`Maurice Cohen opened a Whitebury account with HSBC USA ("HSBC") in 2002.
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`See, e.g., Pl. Exs. 11, 19. The HSBC account opening memo shows that Europamerica
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`8 This Court notes that federal magistrate judge Robin Rosenbaum found sufficient evidence to support the
`conclusion that the Cohens used the advice of attorneys to hide their interest in their corporate entities and to commit
`a fraud on this Court: "[t]he Court cannot escape the finding that the United States has demonstrated that Defendants
`used advice concerning the structuring of the corporate entities, as well as related tax-planning advice, to attempt to
`hide Defendants' ownership interests in the various entities from the courts in the other litigation, all of which
`occurred after the advice in the Kramer documents was set forth. This fact requires the further conclusion that
`Defendants employed their attorneys in the civil litigation where Defendants allegedly arranged for the filing of
`false affidavits and the giving of false testimony as tools to further frauds on the courts where such activity
`occurred." See United States v. Cohen et al., Case No. 10-60159-CR-ZLOCH (S.D. Fla), Order on Government's
`Motion for Determination of Whether Certain Communications Fall Within Attorney-Client Privilege [D.E. 137].
`The ruling was subsequently confirmed by District Court Judge William Zloch.
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`9
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`transferred $26 million to open the new Whitebury account. See Pl. Ex. 57.
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`3.
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`Years of recorded telephone calls between Maurice Cohen and HSBC bankers
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`show that he controlled the Whitebury account and dictated who would have signature authority
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`on the account and who should be listed as its owner. Maurice Cohen's instructions to HSBC
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`bankers were so frequent and readily accepted that one HSBC banker joked that he should be
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`listed as the owner of a Maurice Cohen accounts. See Pl. Ex., 31 (April 25, 2007).
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`4.
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`The Court received an HSBC Account Opening Document that identifies Maurice
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`Cohen as the beneficial owner of Whitebury. See Pl. Exs. 19, 21. Numerous additional bank
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`records describe Whitebury as Maurice Cohen's personal investment company. See, e.g., Pl. Ex.
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`20, 21, 23-24
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`5.
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`Maurice Cohen's wife, Sonia was a signatory for Whitebury. His children, Leon
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`and Lea, were designated as joint signatories for the Whitebury account. See Pl. Ex. 11. Lea
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`Cohen and Sonia Cohen were authorized to open separate accounts at HSBC on account of their
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`relationship to Whitebury. Pl. Ex. 21.
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`6.
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`In approximately April 2007, Maurice Cohen directed HSBC to close the
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`Whitebury account and transfer $22 million to his attorney's trust account (Fieldstone Lester
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`Shear and Denberg LLP). See Pl. Exs. 31, 59. The $22 million was then used to payoff ALR's
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`mortgages on three of the Florida properties.
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`7.
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`The overwhelming weight of the evidence proves Maurice Cohen owns
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`Whitebury.
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`8.
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`Defendants, however, produced documents to CDR in this case purporting to
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`show that someone other than Maurice Cohen owned Whitebury. Specifically, defendants
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`produced a Whitebury Shareholder Affidavit which states: "I, Habib Levy, hereby attest that
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`10
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`since the inception and incorporation of Whitebury Shipping Ltd., a British Virgin Islands
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`corporation, current through the date of this affidavit, I personally own and control One Hundred
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`Percent (100%) of the common stock of Whitebury Shipping Ltd., British Virgin Islands
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`corporation. There is no other class of stock issued for this corporation." See Pl. Ex. 13. Mr.
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`Levy is Maurice Cohen's brother-in-law and Leon Cohen's uncle.
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`9.
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`This Shareholder Affidavit bears Habib Levy's "signature," is notarized by Erian
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`Mazanares, and has two additional witnesses (John Paul Herrera and Richard Barone) attesting to
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`Mr. Levy's alleged signature.
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`10.
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`Defendants also produced a series of Whitebury Promissory Notes purporting to
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`show a series of loans between Whitebury and several of the Corporate Defendants. See Pl. Ex.
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`14. The Promissory Notes total almost $60 million.
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`11.
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`Like the Whitebury Shareholder Affidavit, the Whitebury Promissory Notes are
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`purportedly signed by Mr. Levy as the representative for Whitebury, and are again notarized by
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`Ms. Mazanares. Leon Cohen signed the Promissory Notes on behalf of several of the Corporate
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`Defendants.
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`12.
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`Habib Levy testified before the Court on October 1, 2010, and before the federal
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`jury in the criminal trial days earlier. The Court had the opportunity to observe Mr. Levy, finds
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`him highly credible, and accepts his testimony as true.
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`13.
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`The first time Mr. Levy heard of Whitebury was after Maurice Cohen was
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`arrested.
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`14. Mr. Levy denied having any ownership interest in Whitebury, at any time. He
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`denied signing the Shareholder Affidavit and the Promissory Notes. He denied knowing Erian
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`Mazanares (the notary), John Paul Herrera (an attesting witness) or Richard Barone (a second
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`11
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`

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`attesting witness). Mr. Levy testified in clear and unequivocal terms that the Shareholder
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`Affidavit and Promissory Notes bearing his signatures were forgeries.
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`15.
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`CDR introduced copies of Mr. Levy's passports. See Pl. Exs. 9-10. The genuine
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`signatures on Mr. Levy's passports are patently different from the forged Habib Levy signatures
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`on the Whitebury Shareholder Affidavit and Whitebury Promissory Notes.
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`16.
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`On September 20, 2010, CDR deposed Brian Mazanares, the notary for Mr.
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`Levy's signature. Ms. Mazanares is Leon Cohen's girlfriend. When asked whether she falsely
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`notarized Mr. Levy's signature on the Whitebury Shareholder Affidavit and Whitebury
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`Promissory Notes, Ms. Mazanares invoked her Fifth Amendment privilege against self-
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`incrimination. 9
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`17. Mr. Levy also testified that Maurice Cohen had previously forged his signature
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`regarding an entity named First Hotels Resorts & Investments, Inc. ("First Hotels"). Mr. Levy
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`learned of this forgery after receiving a call from an HSBC banker in 2007. Mr. Levy expressed
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`surprise to the HSBC banker and requested copies of the account documents showing his alleged
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`ownership. See Pl. Exs., 6-8.
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`18.
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`Upon receipt of the documents, Mr. Levy recognized Maurice Cohen's
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`handwriting and confronted Maurice Cohen. Maurice Cohen admitted forging Mr. Levy's
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`signature, admitted owning First Hotels, and promised Mr. Levy that he would remove his name
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`immediately from the HSBC records.
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`19.
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`The recorded HSBC tapes contain extensive evidence demonstrating that Maurice
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`Cohen utilized Habib Levy's name in connection with other entities that Maurice Cohen
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`9 In civil proceedings, the invocation of the Fifth Amendment privilege may result in an adverse inference. See
`Vasquez v. State, 777 So. 2d 1200, 1203 (Fla. 3d DCA 2001) ("the trial court may draw an adverse inference against
`a party in a civil action who invokes his privilege against self-incrimination.").
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`12
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`controlled. See Pl. Ex. 31 (e.g., April 20, 2007 HSBC call ("he wants to make the reservation in
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`my brother-in-law's name, but that doesn't mean anything because I can make the reservation for
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`my brother-in-law and after [inaudible] and I can put someone afterwards."); April 25, 2007
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`HSBC call ("But I sent, I did it in Habib Levy's name and then they did the same thing to him.");
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`April 26, 2007 HSBC call ("Yes, you can give me the minutes, and I, I will Levy sign them.")).
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`20.
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`The Court finds, by clear and convincing evidence, that Maurice and Leon Cohen
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`intentionally falsified documents and forged signatures, in concert with others (Pl. Exs. 13 and
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`14). Sonia and Lea Cohen, were signatories to the Whitebury account and had a united interest
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`with the other defendants to prevent CDR from discovering Whitebury. Defendants produced
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`the forged documents to CDR as part of the scheme to conceal Maurice Cohen's ownership in
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`Whitebury, and to hamper the truth-finding process.
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`FALSIFIED DOCUMENTS AND THE FAILURE TO PRODUCE RELEVANT
`DOCUMENTS RESULTS IN FALSE TESTIMONY
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`21.
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`On June 24, 2010 and July 7, 2010, CDR deposed Ana Perez, the President of
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`ALR. Ms. Perez refused to answer any substantive deposition question, invoking her Fifth
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`Amendment privilege against self-incrimination.
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`22.
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`Subsequently, Lea Cohen caused ALR to hire Sylvia Mergui, and ALR
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`designated Ms. Mergui as its corporate representative. CDR noticed Lea Cohen to appear at the
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`evidentiary hearing on the Motion to Strike, but she did not appear as noticed. The attorneys
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`representing her filed a motion for protective order to excuse her from appearing. See Corporate
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`Defendants' Emergency Motion to Strike Plaintiff's Notice of Taking Testimony at October 1,
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`2010 Evidentiary Hearing, or in the Alternative, Motion for Protective Order. The motion was
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`not ruled on as it was not noticed for hearing.
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`23. Ms. Mergui was not permitted to speak substantively with ALR's president (Ms.
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`13
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`Perez), nor did she make any attempts to ask anyone about ALR's beneficial ownership,
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`including Maurice Cohen, Leon Cohen, Lea Cohen, the attorneys representing ALR or its
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`accountants. Instead, she simply relied on the documents the defendants selectively produced to
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`CDR to provide her sworn testimony. 10
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`24. Ms. Mergui testified that Caribean and Redbury Shipping were the record owners
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`of ALR, but she did not know the individuals who ultimately owned ALR through Caribean and
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`Redbury (e.g. the beneficial owners).
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`25.
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`Conveniently, although she did not know the identities of ALR's beneficial
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`owners, she claimed to know that the neither Maurice nor Leon Cohen owned ALR. Ms. Mergui
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`explained that she was able to exclude Maurice and Leon Cohen as beneficial owners of ALR
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`based on the documents she reviewed.
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`26.
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`Defendants did not provide Ms. Mergui with a copy of an ALR letter dated May
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`6, 2003. See Pl. Ex. 16. The text of the document states: "We the undersigned, hereby
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`acknowledge that we are the owners of the entity known as American Leisure Resorts." The
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`document is on ALR letterhead, bears ALR's fax number, and is signed by Leon and Maurice
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`Cohen. CDR discovered this document when it was introduced into evidence at Maurice and
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`Leon Cohen's criminal trial.
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`27.
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`The May 6, 2003 letter was submitted to HSBC in connection with an ALR loan
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`for 5875 Collins Avenue. The HSBC loan memorandum for 5875 Collins Avenue, Miami
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`Beach, discussed the Cohens' ownership of ALR. See Pl. Ex. 17.
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`28.
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`No one testified on behalf of the defendants to explain the failure to produce the
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`ALR letter dated May 6, 2003.
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`29.
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`The May 6, 2003 letter demonstrates that Ms. Mergui's deposition testimony
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`10 Ms. Mergui testified that she also consulted two outside accountants about certain topics.
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`14
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`regarding the beneficial owners of ALR was ignorant at best, and scripted, at worst. During her
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`cross examination, Ms. Mergui would not even admit that the document was relevant.
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`30.
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`In addition, one of the deposition topics required Ms. Mergui to educate herself
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`on the source of ALR's funds to acquire its interest in the Florida Properties.
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`31.
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`To answer this question, Ms. Mergui reviewed, among other things, the
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`Whitebury Promissory Notes.
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`32.
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`Based on her review of the Whitebury Promissory Notes, Ms. Mergui testified
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`that Habib Levy was connected to Whitebury.
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`33.
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`The Court finds
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`that the defendants provided Ms. Mergui with falsified
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`documents (i.e., the Whitebury Promissory Notes) to induce false testimony. The purpose of the
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`falsification and forgeries was intended to frustrate CDR's efforts to prove that Maurice Cohen
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`owned Whitebury. The Court also finds that the Cohens and the Corporate Defendants,
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`primarily ALR, concealed relevant information from Ms. Mergui to further the fraud on the
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`Court, and to prevent CDR from learning that the Cohens were the true beneficial owners of
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`ALR.
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`WITNESS TAMPERING
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`34.
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`The Court heard testimony from Joelle Habib and Patricia Habib Petetin
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`Benharbon at the evidentiary hearing. Ms. Habib and Ms. Benharbon were named as defendants
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`in the New York lawsuit due to their designation as officers and directors in the Corporate
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`Defendants. Both Ms. Habib and Ms. Benharbon testified at the criminal trial prior to providing
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`testimony before this Court.
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`35.
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`The Court had the opportunity to observe Ms. Habib and Ms. Benharbon during
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`the hearing and finds their testimony truthful and of great weight given the long period of time
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`15
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`the length of time they worked for the Cohens, the opportunities they had to observe what they
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`testified about, and the accuracy of their memory about memorable events during their years of
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`service.
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`36. Ms. Habib was working as a hostess for the Flatotel in Paris when Maurice Cohen
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`hired her to be his personal secretary. She had no formal education, and was approximately 17
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`years old at the time. For more than 20 years, she served as Maurice Cohen's personal secretary.
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`37. While serving as Maurice Cohen's personal secretary, she was named as "gerant"
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`m several entities Maurice Cohen owned, including Flatotel International France, Flatotel
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`Biovimer Cote de Azur, Residence de la Plaine and Macson Express USA. She also had a power
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`of attorney to sign on behalf of an entity named Winder. "Gerant" is a French term which
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`describes the highest position one can hold in a French entity. Although she held the title of
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`gerant, Ms. Habib did not have authority or control over these entities; she simply followed
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`Maurice Cohen's orders. Maurice Cohen was the beneficial owner of these companies, and he
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`used straw men to on ownership records and forged their signatures as needed. This is consistent
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`with the testimony of Habib Levy, who was one straw man who had no that idea his identity had
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`been stolen by Maurice Cohen.
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`38.
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`In February 2000, Maurice Cohen ordered Ms. Habib to travel to New York to
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`attend the New York Flatotel closing to transfer its ownership. She was told that she would be
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`signing documents on behalf of Winder. Maurice Cohen also directed Allegria Aich to travel to
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`New York to attend the closing of the Flatotel. Ms. Ai ch was instructed that she would sign
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`documents on behalf of Blue Ocean.
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`39. Maurice and Leon Cohen went to great lengths to conceal their involvement with
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`the sale of the Flatotel and their ownership of Blue Ocean, Iderval, Summerson and other
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`16
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`entities.
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`40.
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`The Cohens convened two meetings in Paris, France (in June 2009 and March
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`2010). At the meetings, Leon Cohen described the deposition process and provided Ms. Habib,
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`Ms. Benharbon, Ms. Aich, and Mr. Marabeouf with their own particularized scripts. Some
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`witnesses, including Ms. Habib, received a second script which discussed their purported roles in
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`th