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`CUYAHOGA COUNTY CLERK OF COURTS
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`1200 Ontario Street
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`Cleveland, Ohio 44113
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`Court of Common Pleas
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`AMENDED COMPLAINT $75
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`July 29,2020 16:37
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`By: CLAIRE I. WADE 0093174
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`Confirmation Nbr. 2040808
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`EB PINNACLE PROPERTIES, LLC
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`CV 20 931993
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`vs.
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`MARK A. FIXLER ET AL.
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`Judge: DANIEL GAUL
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`Pages Filed: 15
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`Electronically Filed 07/29/2020 16:37 / COMPLAINT / CV 20 931993 / Confirmation Nbr. 2040808 / CLJSZ
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`IN THE COURT OF COMMON PLEAS
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`CUYAHOGA COUNTY, OHIO
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`EB PINNACLE PROPERTIES, LLC,
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`CASE NO. CV-20-931993
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`individually and on behalf of all others similarly )
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`situated
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`JUDGE: DANIEL GAUL
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`FIRST AMENDED CLASS
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`ACTION COMPLAINT WITH
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`JURY DEMAND
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`Plaintiff,
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`v.
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`MARK A. FIXLER
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`355 West Edinburgh Dr.
`Highland Heights, OH 44143
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`-and-
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`SHERRY FIXLER
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`355 West Edinburgh Dr.
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`Highland Heights, OH 44143
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`-and-
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`JAG ENTERPRISES LLC
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`c/o Corporate Agents, Inc.
`30195 Chagrin Blvd.
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`Cleveland, OH 44124
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`-and-
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`BRIAN HOROWITZ
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`30195 Chagrin Blvd. Suite 300
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`Cleveland, OH 44124
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`-and-
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`JACKSON-STEINEM HOLDINGS LLC
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`30199 Pinetree Road, #299
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`Pepper Pike, OH 44124
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`Defendants.
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`CLASS ACTION COMPLAINT
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`Electronically Filed 07/29/2020 16:37 / COMPLAINT / CV 20 931993 / Confirmation Nbr. 2040808 / CLJSZ
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`Plaintiff EB Pinnacle Properties, LLC (“Pinnacle”) seeks to proceed, under Civ.R. 23, as
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`the representative of former borrowers of the Defendant Mark Fixler (“M. Fixler”) (together, the
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`“Class”), who fell victim to a fraudulent scheme run by M. Fixler, a “hard money loan broker”,
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`and a network of “hard money lenders,” including Defendants Sherry Fixler (“S. Fixler”), JAG
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`Enterprises LLC (“JAG”) and Brian Horowitz (“Horowitz”).
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`INTRODUCTION
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`1. This case involves a mortgage lending scheme where Defendants structured mortgage
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`loans in a manner that deprives borrowers of statutory rights under Ohio law. When these
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`borrowers defaulted, Defendants engaged in “self-help” foreclosures against Plaintiff and
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`other members of the Class, often without notice, using documents signed at closing to
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`unilaterally convey the secured property to themselves and/or their nominees without
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`filing a foreclosure lawsuit. The Ohio Supreme Court and other courts throughout this
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`state have recognized that requiring a borrower to execute documents allowing the
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`mortgagee to sidestep the foreclosure process is an improper clog on the mortgagor’s
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`right of redemption.
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`2. As a condition of the loan closing, Defendants required borrowers to execute a Power of
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`Attorney where borrowers irrevocably appointed one or more Defendants as their
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`attorney-in-fact for the purpose of executing a deed conveying the secured property.
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`Although the legislature has established that an attorney-in-fact owes various fiduciary
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`duties to the principal, Defendants necessarily breached such duties when they misused
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`their role as attorney-in-fact to seize property from borrowers.
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`3. On information and belief, Defendants successfully seized collateral from at least thirty-
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`two defaulted borrowers in Cuyahoga County alone, and more in surrounding counties.
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`By doing so, they not only deprived the borrowers their right to a court-ordered public
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`sheriff sale and right of redemption, but also several hundred thousand dollars of
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`unrealized equity in the properties they seized from borrowers.
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`PARTIES
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`4. Plaintiff EB Pinnacle Properties LLC is an Ohio limited liability company engaged in
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`real estate investment in the Cleveland area. Pinnacle obtained two hard money loans
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`from S. Fixler, JAG, and Horowitz (together, the “Lender Defendants”) via hard money
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`broker M. Fixler, secured by six residential properties. Pinnacle executed a power of
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`attorney (“POA”) for each loan simultaneously with the mortgage appointing M. Fixler
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`as agent, who was in turn acting as agent for the lender(s). When Pinnacle defaulted on
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`one loan, M. Fixler, acting as attorney-in-fact for Pinnacle, quitclaimed all six properties
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`to Jackson-Steinem using the POAs. Jackson-Steinem then sold the properties to Family
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`Time for the outstanding lien amount.
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`5. Defendant Mark Fixler is an Ohio resident, who, at all relevant times, acted as a hard
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`money lender and/or loan broker who facilitated loans between hard money lenders and
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`borrowers for a fee.
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`6. Defendant Sherry Fixler is an Ohio resident, who acted as a hard money lender through
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`M. Fixler.
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`7. Defendant JAG Enterprises LLC is an Ohio corporation that acted as a hard money lender
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`through M. Fixler.
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`8. Defendant Brian Horowitz is an Ohio resident, who acted as a hard money lender through
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`M. Fixler.
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`9. Defendant Jackson-Steinem Holdings LLC is an Ohio limited liability company who
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`acquired properties via quitclaim deed executed by M. Fixler as attorney-in-fact for
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`Plaintiff, and subsequently sold them.
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`JURISDICTION AND VENUE
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`10. This Court has original jurisdiction under R.C. 2305.01. Removal under the Class Action
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`Fairness Act (28 U.S.C. § 1453) would be improper because two-thirds or more of the
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`members of the proposed class are Ohio citizens, the primary defendants are Ohio
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`citizens, and the primary injuries alleged occurred in Ohio.
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`11. Venue is proper under Ohio Civ.R. 3(B) because Defendants M. Fixler, S. Fixler, JAG,
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`Horowitz, and Jackson-Steinem are residents of Cuyahoga County, and the six Pinnacle
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`properties at issue are located in Cuyahoga County.
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`FACTUAL ALLEGATIONS
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`12. A hard money loan is a short-term loan secured by real estate. They are funded by private
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`investors as opposed to conventional lenders such as banks or credit unions. The terms
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`are usually around 12 months, but the loan term can be extended to longer terms of 2-5
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`years. The loans typically require monthly payments of only interest or interest and some
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`principal with a balloon payment at the end of the term. Interest rates typically vary from
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`12%-20% per annum, and lenders typically charge 1-5% of the loan balance as a closing
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`cost.
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`13. Defendant M. Fixler is a hard money “loan broker” who acts as a go-between for a
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`borrower and a lender.
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`14. On or about September, 2018, Pinnacle borrowed $60,000 from S. Fixler and JAG,
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`giving three investment properties as security: 21801 Fuller Avenue, Euclid, Ohio 44123;
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`3247 W. 114th Street, Cleveland, Ohio; and 3346 W. 129th Street, Cleveland, Ohio (the
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`“JAG Loan”).
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`15. Ellis, as sole member of Pinnacle, executed a POA appointing M. Fixler, as agent for S.
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`Fixler and JAG, as Pinnacle’s attorney-in-fact, authorizing M. Fixler to execute and
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`deliver a deed for the properties to the Lender or assignees. The POA was recorded
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`simultaneously with the mortgage.
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`16. M. Fixler was acting as S. Fixler’s agent with respect to the JAG Loan.
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`17. M. Fixler was acting as JAG Enterprises LLC’s agent with respect to the JAG Loan.
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`18. On or about January of 2019, Pinnacle borrowed $60,000 from Horowitz, giving three
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`investment properties as security: 4420 Sackett Avenue, Cleveland, Ohio 44109; 3385 W.
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`44th Street, Cleveland, Ohio 44109; and 3356 W. 44th Street, Cleveland, Ohio, 44109 (the
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`“Horowitz Loan”).
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`19. Ellis, as sole member of Pinnacle, executed a POA appointing M. Fixler, as agent for
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`Horowitz, as Pinnacle’s attorney-in-fact, authorizing M. Fixler to execute and deliver a
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`deed for the properties to the Lender or assignees.
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`20. The POA was recorded simultaneously with the mortgage.
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`21. M. Fixler was acting as Horowitz’s agent with respect to the Horowitz Loan.
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`22. Since 2017, M. Fixler has recorded 587 similar POAs in Cuyahoga County.
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`23. Upon information and belief M. Fixler has also recorded similar POAs in surrounding
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`counties.
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`24. In 2019, shortly after executing the Horowitz loan, Pinnacle defaulted on both the JAG
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`Loan and Horowitz Loan.
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`25. S. Fixler and JAG did not give Pinnacle or Ellis notice of default of the JAG Loan or
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`Horowitz Loan.
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`26. Instead, S. Fixler and JAG obtained three separate cognovit judgments in the Lake
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`County Court of Common Pleas from May 29, 2019 through January 27, 2020 against
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`Pinnacle.
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`27. On February 5, 2020, M. Fixler used Pinnacle’s POAs to quitclaim all six Pinnacle
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`properties to Jackson-Steinem, the three properties used as security for the JAG Loan and
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`the three properties used as security for the Horowitz Loan.
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`28. M. Fixler was acting as agent and/or employee of the Lender Defendants when M. Fixler
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`quitclaimed the six Pinnacle properties to Jackson-Steinem.
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`29. M. Fixler has recorded at least 32 additional quitclaim deeds using POAs in Cuyahoga
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`County.
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`30. Upon information and belief, M. Fixler has recorded additional quitclaim deeds using
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`POAs in surrounding counties.
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`31. On March 4, 2020, Jackson-Steinem sold the six Pinnacle properties to a third-party
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`purchaser for approximately $98,000.
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`32. On information and belief, the fair market value for the Pinnacle properties seized by
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`Defendants was approximately $716,000.
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`33. By seizing Pinnacle’s properties, Defendants seized approximately $618,000 in
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`unrealized equity rightfully belonging to Pinnacle.
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`CLASS ACTION ALLEGATIONS
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`34. Plaintiff brings this action under Ohio Civ.R. 23(A) and (B)(3) on behalf of Plaintiff and
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`the following Class of all others similarly situated:
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`a) Borrowers who executed a Power of Attorney (“POA”) that allowed M. Fixler to
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`"sign.. .deliver and record a deed conveying to Lender or Lender’s assignee or
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`nominee, all of Grantor’s right, title and interest in and to the properties. with
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`regard to the enforcement of a certain Cognovit Promissory Note,” were deprived
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`of their equity of redemption and a public sale, and whose properties were
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`quitclaimed and sold to third parties for a fraction of the fair-market value.
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`35. The Class is so numerous that joinder of all class members is impracticable. And while
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`Plaintiff is unable to state at this time the exact size of the potential class, based on
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`Plaintiff’s review of the deed index in Cuyahoga County, Plaintiff believes the class
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`could consist of over one hundred people.
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`36. Common legal or factual issues predominate individual issues affecting the Class,
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`including:
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`a) That in the course of his agency and/or employment by the Lender Defendants,
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`M. Fixler had borrowers execute a POA simultaneously with mortgages
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`appointing him as attorney-in-fact of each member of the Class, who in turn was
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`acting as agent for the Lender Defendants;
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`b) The POAs were recorded simultaneously with the mortgages;
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`c) In the case of default, and in the course of his agency and/or employment by the
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`Lender Defendants, M. Fixler would use the POA to convey collateral properties
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`to the Lender Defendants or another related entity without first obtaining a decree
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`of foreclosure.
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`d) M. Fixler breached his fiduciary duty to the Class members when he used his
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`appointment as attorney-in-fact to convey the Class members’ property.
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`37. The claims of Plaintiff are typical of Class members’ claims. Plaintiffs claims arise out
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`of the same course of conduct by Defendants and are based on the same legal theories as
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`Class members’ claims.
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`38. Plaintiff will fairly and adequately protect Class members’ interests. Plaintiff’s interests
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`are not antagonistic to, but instead comport with, the interests of the other Class
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`members.
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`39. Plaintiff’s counsel are adequate class counsel under Civ.R. 23(F)(1) and (4) and are fully
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`qualified and prepared to fairly and adequately represent the Class’ interests.
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`40. The questions of law or fact that are common to the Class, including those listed above,
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`predominate over any questions affecting only individual members.
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`41. A class action is superior to other available methods for the fair and efficient adjudication
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`of this controversy. Requiring Class members to pursue their claims individually would
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`entail a host of separate suits, with concomitant duplication of costs, attorneys’ fees, and
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`demands on court resources. The amounts at stake for many of the Class members, while
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`substantial, are not great enough to enable them to maintain separate suits against
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`Defendants. Certification of this case under Civ.R. 23 will enable the issues to be
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`adjudicated for all class members with the efficiencies of class litigation.
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`42. Without a class action, Defendants will retain the benefits of their wrongdoing, which
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`will result in further damage to Plaintiff and the class members.
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`COUNT I - BREACH OF FIDUCIARY DUTY UNDER R.C. § 1337.34
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`(Against M. Fixler Only)
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`43. All previous paragraphs are incorporated as though fully set forth herein.
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`44. Plaintiff and members of the Class executed POAs appointing M. Fixler as their attorney
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`in-fact.
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`45. M. Fixler, by accepting appointment as attorney-in-fact, owed fiduciary duties to Plaintiff
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`and the members of the Class, including, without limitation:
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`a) To act in accordance with the principal’s reasonable expectations and otherwise in
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`the principal’s best interest;
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`b) To act in good faith;
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`c) To act loyally for the principal’ s benefit;
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`d) To act so as not to create a conflict of interest that impairs the agent’s ability to
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`act impartially in the principal’ s best interest.
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`46. A fiduciary may not use the special confidence and trust which a fiduciary duty imposes
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`to acquire or retain property for himself or his benefit.
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`47. The seizure of the borrowers’ property was not in accordance with their reasonable
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`expectations, nor their best interest.
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`48. The seizure of the borrowers’ property created a conflict of interest that impaired M.
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`Fixler’ s ability to act impartially in the principal’ s best interest.
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`49. M. Fixler exercised his agency granted by the POA for his own benefit, so that he could
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`acquire or retain the borrowers’ property for himself and/or the other Defendants.
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`50. M. Fixler breached his fiduciary duty to Plaintiff and the Class members when he
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`exercised his authority as attorney-in-fact to execute and record a deed conveying the
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`property of the Plaintiff and the Class.
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`51. Plaintiff and the Class suffered loss of rental income, forfeiture of equity in the seized
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`property, and other monetary damages when M. Fixler used their POAs to seize their
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`property.
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`52. As a direct result of Defendants’ unlawful conduct, Pinnacle and similarly situated others
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`suffered and continue to suffer pecuniary harm.
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`COUNT II -BREACH OF FIDUCIARY DUTY
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`(Against M. Fixler Only)
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`53. All previous paragraphs are incorporated as though fully set forth herein.
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`54. Plaintiff and members of the Class executed POAs appointing M. Fixler as attorney-in-
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`fact.
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`55. M. Fixler, by accepting appointment as attorney-in-fact, owed a fiduciary duty to act for
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`the benefit of the principal of each POA.
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`56. A fiduciary may not use the special confidence and trust which a fiduciary duty imposes
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`to acquire or retain property for himself.
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`57. The seizure of the borrowers’ property is not in their best interest.
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`58. M. Fixler breached his fiduciary duty to Plaintiff and the Class when he exercised his
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`authority as attorney-in-fact to execute and record a deed conveying the property of the
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`Plaintiff and the Class.
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`59. M. Fixler exercised his authority as attorney-in-fact for his own benefit, so that he could
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`acquire or retain the borrowers’ property for himself.
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`60. Plaintiff and members of the Class suffered a loss of rental income and monetary
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`damages when M. Fixler used their POAs to seize their property.
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`61. As a direct result of Defendants’ unlawful conduct, Pinnacle and similarly situated others
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`suffered and continue to suffer pecuniary harm.
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`COUNT III -CONVERSION
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`(Against All Defendants)
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`62. All previous paragraphs are incorporated as though fully set forth herein.
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`63. Plaintiff and members of the Class owned the subject properties at the time of the
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`conversion.
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`64. Defendants converted the property of Plaintiff and members of the Class to their own by
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`wrongfully quitclaiming the properties via POA and depriving them of their equity of
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`redemption and judicially ordered public sale.
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`65. As a direct result of Defendants’ unlawful conduct, Pinnacle and similarly situated others
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`suffered and continue to suffer pecuniary harm.
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`COUNT IV - UNJUST ENRICHMENT
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`(Against All Defendants)
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`66. All previous paragraphs are incorporated as though fully set forth herein.
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`67. By conveying the secured property to Defendants and/or their nominees by and through
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`M. Fixler as attorney-in-fact, Plaintiff and the Class conferred a benefit upon Defendants.
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`68. The Defendants are aware of the benefit.
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`69. By failing to return the property to its owner, Defendants retain the benefit under
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`circumstances where it would be unjust to do so without payment.
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`70. As a direct result of Defendants’ unlawful conduct, Pinnacle and similarly situated others
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`suffered and continue to suffer pecuniary harm.
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`COUNT V - CIVIL CONSPIRACY
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`(Against All Defendants)
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`71. All previous paragraphs are incorporated as though fully set forth herein.
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`72. Defendants maliciously conspired together to make predatory mortgage loans to Plaintiff
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`and similarly situated others, intending to deprive Plaintiff and similarly situated others
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`of the right of redemption in case of default, and intending to seize collateral properties
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`extrajudicially without compensation.
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`73. Defendants maliciously injured Plaintiff and similarly situated others by directing M.
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`Fixler to breach his fiduciary duty and misuse his authority as attorney-in-fact to
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`wrongfully seize the collateral properties.
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`74. As a direct result of Defendants’ unlawful conduct, Plaintiffs and similarly situated others
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`suffered and continue to suffer pecuniary harm.
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`COUNT VI - VICARIOUS LIABILITY / RESPONDEAT SUPERIOR
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`(Against S. Fixler, JAG, and Horowitz)
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`75. All previous paragraphs are incorporated as though fully set forth herein.
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`76. At all relevant times, M. Fixler was the agent and/or employee of S. Fixler, JAG, and
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`Horowitz (together, the “Lender Defendants”).
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`77. While in the course and scope of his employment and/or agency relationship with the
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`Lender Defendants, M. Fixler procured appointment as attorney-in-fact by Plaintiff and
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`the Class by way of the POAs.
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`78. While in the course and scope of his employment and/or agency relationship with the
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`Lender Defendants, M. Fixler breached his fiduciary duty to Plaintiff and the Class when
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`he exercised his authority as attorney-in-fact to execute and record a deed conveying the
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`property of the Plaintiff and the Class.
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`79. M. Fixler is liable to Plaintiff and the Class for damages as the result of M. Fixler’s
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`breach.
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`80. Lender Defendants, as principal and/or employer of M. Fixler, are liable to Plaintiff and
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`the Class for damages as the result of M. Fixler’ s breach.
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`81. As a direct result of Defendants’ unlawful conduct, Pinnacle and similarly situated others
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`suffered and continue to suffer pecuniary harm.
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`PRAYER FOR RELIEF
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`Plaintiff, and all those similarly situated, collectively request that this Court provide the
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`following relief:
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`1. An order permitting this litigation to proceed as a class action, and certifying the Class
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`under Civ.R. 23(A) and (B)(3);
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`2. An order to promptly notify to all class members that this litigation is pending;
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`3. Declaratory judgment and injunctive relief against Defendants’ unlawful conduct;
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`4. Damages for Plaintiff and the class represented in excess of $25,000;
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`5. Attorneys’ fees, costs, and pre-judgment interest; and
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`6. Such other relief as this Court deems just and proper.
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`Respectfully Submitted,
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`/s/ Claire I. Wade-Kilts___________
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`Claire I. Wade-Kilts (0093174)
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`Sean H. Sobel(0086905)
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`Sobel, Wade & Mapley, LLC
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`55 Erieview Plaza, Suite 370
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`Cleveland, Ohio 44114
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`T:(216)223-7213
`F:(216)223-7213
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`wade@swmlawfirm.com
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`sobel@swmlawfirm.com
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`/s/ Christian E. Carson
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`Christian E. Carson (0088523)
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`Carson Law Firm LLC
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`2618 North Moreland Blvd.
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`Cleveland, OH 44120
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`T: (216)352-4243
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`F: (216)539-8137
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`christian@lawcarson.com
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`Attorneys for Plaintiff
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`JURY DEMAND
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`Plaintiff hereby demands a jury trial by the maximum persons permitted by law on all
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`issues herein triable to a jury.
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`/s/ Claire I. Wade-Kilts___________
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`Claire I. Wade-Kilts (0093174)
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`CERTIFICATE OF SERVICE
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`I certify that on July 29, 2020 a copy of the foregoing was filed electronically. Notice of
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`this filing will be sent by operation of the Court's electronic filing system to all parties indicated
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`on the electronic filing receipt.
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`/s/ Claire I. Wade-Kilts___________
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`Claire I. Wade-Kilts
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`Attorney for Plaintiff
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