20
,, { 2 3 4 5 6 7 8 9 10 II 12 13 ) ' SHENOI KOES LLP Allan A. # 122566] Daniel J. Koes [ SB # 192513] 175 South Lake Avenue, Suite 202 .. · .... ·· .. Pasadena, California 9110 I J .II::- li '·' Telephone: 626-792-2300 '1- \ ' f :: Facstmile: 626-792-231 I AttornTL'i for Plainti tT ..,' :'' POPA AL K. SAVLA SUPERIOR COURT OF THE STATE OF CALIFORNIA FOR THE COUNTY OF SAN BERNADINO RANCHO CUCAMONGA DISTRICT POPATLAL K, SAVLA, on behalf 14 of himself and all others similarly CASE NO.: CIVRS 1008116 [Assigned to Hon. David A. Williams] Dept. R8 15 situated; 16 17 Plaintiff, VERIFIED FIRST AMENDED COMPLAINT FOR: 18 vs. I. Breach of Contract 19 NITHY ANANDA FOUNDATION, 3. uiet Title 20 Corporation, 2. Performance 4. raud 5. RICO 21 22 23 24 25 26 27 28 MA NITHY A SADHANANDA, a Individual, SIVA VALLABHANENI, a Individual, And DOES I to 30. Defendants. 6. RICO Conspiracy 7. Civil Consp1racy 8. Constructive Trust 9. Unfair Business Practices fComQlaint filed: July 26, 20 I 0 I rial Date: None] COMES NOW Plaintiff POP A TALK. SAY LA, individually and on behalf of all others similarly situated, complains of Defendants NlTHY ANANDA l ! OIWI\04-1 7 DOC; \'FRIFIID FIRS I ".MFNI>LD COMPLAIN I

FRAUD complaint against Nithyananda by Ex-donor Popatlal Savla - Extracts

Embed Size (px)

DESCRIPTION

Mt. Popatlal Savla, an ex-­‐devotee of Nithyananda had donated over $1.7 Million to Nithyananda Foundation in California (in 2007-­‐2008), because Nithyananda promised to build a Vedic University in Los Angeles. Using this donation Nithyananda Foundation purchased an immovable property in Los Angeles. In Mar-­‐Apr 2010, Mr. Savla was shocked to discover several disturbing information about Nithyananda and his character, including the sex-­‐contract (Nithyanandaadmitted its existence) and his intentions to never really start a Vedic University aspromised. Had Mr. Savla known the true facts, he would have never made anypayments to the FOUNDATION, or associated himself with it or its leader and"alter ego" Swami Nithyananda in any fashion.Mr. Savla’s consent to pay the $ 1.7 million had clearly been procured by fraud,including intentional concealment and misrepresentations of the Defendantsand their principal Swami Nithyananda. Plaintiff would have never agreed to paythe $1.7 million that he paid to to the FOUNDATION for the Property had theDefendant FOUNDATION and its principal and "alter ego" Swami Nithyananda and theother individual Defendants and co-­‐conspirators, SRI NITHYA SADHANANDA and SIVA VALLABHANENI, honestly represented the goings on and true purpose and nature of the FOUNDATION's vile activities.Hence Mr. Savla sued Nithyananda and his foundation for fraud, racketeering, breach of contract and other offenses. The US Court has upheld the case, a jury has found Nithyananda Foundation guilty of fraud and ordered that the money fraudulently obtained by Nithyananda from Mr. Savla must be returned to him. The verdict from the case can be found separately.

Citation preview

Page 1: FRAUD complaint against Nithyananda by  Ex-donor Popatlal Savla - Extracts

,, { 2

3

4

5

6

7

8

9

10

II

12

13

) ' SHENOI KOES LLP Allan A. Shenoi~CSB # 122566] Daniel J. Koes [ SB # 192513] 175 South Lake Avenue, Suite 202 .. · .... ·· .. Pasadena, California 9110 I J .II::- li '·'

Telephone: 626-792-2300 '1- \ ' f ::

Facstmile: 626-792-231 I

AttornTL'i for Plainti tT ..,' ~1 :''

POPA AL K. SAVLA

SUPERIOR COURT OF THE STATE OF CALIFORNIA

FOR THE COUNTY OF SAN BERNADINO

RANCHO CUCAMONGA DISTRICT

POPATLAL K, SAVLA, on behalf 14

of himself and all others similarly CASE NO.: CIVRS 1008116 [Assigned to Hon. David A. Williams] Dept. R8 15 situated;

16

17 Plaintiff, VERIFIED FIRST AMENDED

COMPLAINT FOR: 18 vs. I. Breach of Contract 19

NITHY ANANDA FOUNDATION, 3. uiet Title 20 Corporation,

2. ~ecific Performance

4. raud 5. RICO

21

22

23

24

25

26

27

28

MA NITHY A SADHANANDA, a Individual, SIVA VALLABHANENI, a Individual, And DOES I to 30.

Defendants.

6. RICO Conspiracy 7. Civil Consp1racy 8. Constructive Trust 9. Unfair Business Practices

fComQlaint filed: July 26, 20 I 0 I rial Date: None]

COMES NOW Plaintiff POP A TALK. SAY LA, individually and on behalf of

all others similarly situated, complains of Defendants NlTHY ANANDA l

! OIWI\04-1 7 DOC;

\'FRIFIID FIRS I ".MFNI>LD COMPLAIN I

Highlight
Highlight
Highlight
Highlight
Highlight
Highlight
Highlight
Highlight
Highlight
Page 2: FRAUD complaint against Nithyananda by  Ex-donor Popatlal Savla - Extracts

other companies--listed on the FOUNDATION's 990 PF tax filings. It is also the 2

3 address of Defendant V ALLABHENENI as well, and was listed on the

4 FOUNDATION's records filed with the California Secretary of State as of July 8,

5 2009 for the agent for service of process on the FOUNDATION.

6

7 7. Beginning in March 2010, Plaintiff learned that the FOUNDATION is the

8 "alter ego" of and one and the same as an individual named Swami Nithyananda, also

9

10 known as Sri Nithyananda Swami or Paramahamsa Nithyananda ("Swami

II Nithyananda"). On information and belief, it is alleged that Swami Nithyananda is 12

13 the equitable owner of the Defendant FOUNDATION. There is a unity of interest

14 and ownership between Swami Nithyananda and the FOUNDATION such that, in

15 reality, their separateness does not exist. Moreover, the treatment of the actions in

16

17 question in this complaint as those of Swami Nithyananda alone would lead to an

18 inequitable result and promote an injustice. 19

Therefore, the Defendant

20 FOUNDATION and Swami Nithyananda will be collectively referred to as the

21 FOUNDATION in this Complaint.

22 8.

23 On information and belief, it is alleged that Swami Nithyananda created the

24 FOUNDATION, signed its original tax returns, filed documents with the federal

25 government in 2004 and 2005 as the FOUNDATION's President, and--as Plaintiff 26

27 has learned since March 201 0--has at all times relevant herein controlled and

28 operated the FOUNDATION as his own personal asset and his personal piggybank or

4

(00030447 DOC)

------------ ---------------------------VERIFIED FIRST AMENDED COMPLAINT

Underline
Underline
Underline
Underline
Highlight
Page 3: FRAUD complaint against Nithyananda by  Ex-donor Popatlal Savla - Extracts

ATM machine. Swami Nithyananda the principal and "alter ego" of the Defendant 2

3 FOUNDATION, made all of the decisions on behalf of the Defendant

4 FOl..JNDATION.

5 9. On information and belief, it is also alleged that Swami Nithyananda controls

6

7 numerous other organizations as his own personal assets and transfers monies from

8 one entity to another at will, including monies from the FOUNDATION to a 9

10 company, Nithyananda Export and Import, that was created, operated and is run by

II Swami Nithyananda's brother. To "cover up" or conceal these transactions which 12

13 moved large sums of money out of the FOUNDATION, Swami Nithyananda and his

14 brother originated invoices from an entity named Dhyanapeeta Charitable Trust in

15 Bangalore, India. For example, on April 17, 2010, Plaintiff obtained a printout of

16

17 invoices totaling $550,386.82 from Nithyananda Imports and Exports to Nithyananda

18 Dyanapeetam Temple and Cultural Center for statues that were worth less than 19

20 $100,000. In this manner, Defendants conspired to and did move large sums of

21 money out from the FOUNDATION to its principal Swami Nithyananda and his

22 surrogates abroad.

23

24 10. A sample list of the numerous other entities (in the United States alone) which

25 are on information and belief alleged to be the "alter egos" of Swami Nithyananda 26

27 and the FOUNDATION consists of Bliss Investment Corporation (California

28 corporation No. C3297125), Life Bliss Foundation, Inc., (California corporation No.

5

(00030447 DOC)

"-------·~---------·--------- ------ ------------·-·-···--------------·- ----------------------- -- --~--------------· VERIFIED FIRST AMENDED COMPLAINT

Underline
Underline
Highlight
Highlight
Highlight
Highlight
Highlight
Page 4: FRAUD complaint against Nithyananda by  Ex-donor Popatlal Savla - Extracts

C2851623 ), International Governing Body Commission of Nithyananda 2

3 Dhyanapeetam and Nithyananda Mission (California corporation No. C3257947),

4 Nithyananda Anna Mandir (California corporation No. C31 03430), Nithyananda

5 Dhyanapeetam of San Jose (California corporation No. C2950617), Nithyananda

6

7 Dhyanapeetam Temple & Cultural Center (California corporation No. C279478l ),

8 Nithyananda Spiritual Healing Research Foundation, Inc., (California corporation No.

9

10 C2851586 (dissolved)), Nithyananda Yoga and Meditation University (California

II corporation No. C2946592), Nithyananda Yoga Foundation, Inc., (California 12

13 corporation No. C285188), Ananda Business Solutions LLC (California corporation

14 No. C2113485), Ananda Consulting LLC (California corporation No. C213485),

15 Nithyananda Dhyana Peetam, LLC (entity No. 200520010060 (cancelled)),

16

17 Nithyananda Investments, LLC (entity No. 200731110064 (cancelled)) and

18 Nithyananda Temple Arts, LLC (entity No. 200726010177). The above list is not an 19

20 all-inclusive list of "alter ego" companies here in the United States, and does not

21 include the multitude of other entities in Canada such as the Nithyananda Meditation

22 Academy.

23

24 11. At all times relevant herein, the real property that is the subject of this action,

25 and for which the Court, on August 6, 20 I 0, granted an Order of Judicial Approval 26

27 for Recordation of a lis pendens, is located in San Bernardino County (the

28 "Property"). The Property is commonly known as 5271 San Bernardino Street,

6

(00030447.DOC)

-----·-------VERIFIED FIRST AMENDED COMPLAINT

Highlight
Page 5: FRAUD complaint against Nithyananda by  Ex-donor Popatlal Savla - Extracts

2

3

4

5

6

7

8

9

10

II

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

14. Plaintiff is informed and believes--and based thereon alleges--that each of the

Defendants is responsible, negligently or intentionally, or in some other actionable

manner, for the events and happenings referred to herein and caused the damages

proximately resulting to Plaintiff.

15. Plaintiff is informed and believes--and based thereon alleges--that each of the

Defendants was a co-conspirator of its/his/her co-defendants, and in doing the things

alleged in this complaint was acting within the course and scope of the conspiracy.

16. In justifiable reliance on the representations of the FOUNDATION's principal,

Swami Nithyananda, that the Property would be used for a Vedic University which

would train hundreds of clerics in the religion of the Foundation, and the described

nature of the FOUNDATION's activities, Plaintiff made the following payments to

the Defendant FOUNDATION:

December 11, 2007

December 26, 2007

December 18, 2008

$ 536,990.00

$ 651 ,000.00

$ 400,000.00.

17. In late March- early April 2010, Plaintiff discovered that Swami Nithyananda

had through various schemes and artifices siphoned off large sums of money paid to

the FOUNDATION. One scheme was to have the Swami's brother ship statues of

Hindu Deities to California for resale at highly inflated prices. Dozens of these

statues were resold here for grossly inflated sums, and astounding sums of money

8

(00030447 DOC}

------- ------···------------ ·-·-------- ----VERIFIED FIRST AMENDED COMPLAINT

Underline
Underline
Underline
Underline
Underline
Underline
Highlight
Highlight
Page 6: FRAUD complaint against Nithyananda by  Ex-donor Popatlal Savla - Extracts

2

3

4

5

6

7

8

9

10

were wire-transferred from purported non-profit organizations like Life-Bliss

Foundation to Swami Nithyananda's brother's company, Nithyananda Export and

Import, or to accounts that Swami Nithyananda and his brother benefit from and

controlled. Over $550,000 was wire transferred in furtherance of this scheme. Swami

Nithyananda, the principal and "alter ego" of the FOUNDATION, used this method

of shipping statues from his brother's company to transfer these funds from the

FOUNDATION to his brother, for his own personal benefit.

11 18. Another scheme of the Defendants was to encourage individuals in the United 12

13

14

15

16

17

States to contribute to the cost of ownership of the premises of Swami Nithyananda

and the FOUNDATION located in India. In April 2010, Plaintiff discovered that

ownership of much of that land on which these premises is built in India was in

Swami Nithyananda's personal name. When Plaintiff confronted Swami

18 Nithyananda with this information in April 20 l 0, Swami Nithyananda admitted it was 19

20

21

22

23

24

25

26

27

true, and stated--by way of excuse for his earlier misrepresentations--that the donor of

this land declined to give the land to any charitable foundation so Swami

Nithyananda claimed he had to accept ownership of it in his own name.

19. In April 2010, Plaintiff also learned that Swami Nithyananda had started a

hedge fund in the United States after falsely entering the United States on a visa that

entitled him to perform religious ceremonies only. That hedge fund is called

28 Nithyananda Capital Management, Inc., LLC, and was formed on November 26,

9

(00030447.DOC)

VERIFIED FIRST AMENDED COMPLAINT

Underline
Underline
Underline
Underline
Highlight
Highlight
Highlight
Page 7: FRAUD complaint against Nithyananda by  Ex-donor Popatlal Savla - Extracts

2

3

4

5

6

7

8

9

10

II

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

2007. Another entity named Nithyananda Investment Fund, I, L. P was also created.

And yet another entity named Nithya Advisors, LLC was created on April 8, 2008.

20. After further investigation, Plaintiff discovered in April 2010 that Life Bliss

Foundation--one of Swami Nithyananda's "alter ego" corporations--had revenues of

$2,693,322 in the 2007 tax year, but only $394,929 in expenses.

21. In April 2010, Plaintiff demanded and was given a "profit and loss" statement

for the Defendant FOUNDATION dated April 5, 2010 that showed over

$4,223,066.41 in donations, and $4,110,934.68 in net ordinary income. A true and

correct copy of this document is attached hereto as Exhibit C.

22. Since April 2010, Plaintiff also discovered the Defendant FOUNDATION's

principal, Swami Nithyananda, had deliberately assumed a false identity in the United

States via a document which misrepresented that Swami Nithyananda was born on

January 1, 1978, even though his passport revealed Swami Nithyananda was born on

March 13, 1977. Swami Nithyananda was telling the Indian passport service and the

Government of the United States something quite different from what Swami

Nithyananda was representing to Plaintiff.

23. Most alarmingly, Plaintiff learned m late March 2010 through newspaper

reports in India of a so called Non-Disclosure Agreement that the Nithyananda

Dhyanapeetarn!Dhyanapeeta Charitable Trust and the Defendant FOUNDATION had

been requiring attendees to their premises to sign. A true and correct copy of the

10

( 0003044 7. ocx:: l

VERIFIED FIRST AMENDED COMPLAINT

Underline
Underline
Underline
Underline
Highlight
Highlight
Highlight
Highlight
Highlight
Highlight
Page 8: FRAUD complaint against Nithyananda by  Ex-donor Popatlal Savla - Extracts

2

3

4

5

6

7

8

9

10

II

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Agreement that was given to Plaintiff--in response to his inquiry in April 201 0--is

attached hereto as Exhibit D. It is executed by one of the individual defendants,

SADHANANDA.

24. The Non-Disclosure Agreement lists the 928 Huntington Drive, Duarte,

California 91010 address for the Defendant FOUNDATION. Plaintiff was shocked

and dismayed to learn that the addendum to the Non-Disclosure Agreement made

volunteers consent to "sexual or adult oriented material" that it claimed was

"associated with the practice of any Tantric rituals" and also required consent to

"other adult oriented material ... " Paragraph A3 explicitly stated: "Volunteer

understands that the Program may involve the learning and practice of ancient tantric

secrets associated with male and female ecstasy, including the use of sexual energy

for increased intimacy/spiritual connection, pleasure, harmony, and freedom.

Volunteer understands that these activities ... may involve nudity, access to visual

images, graphic visual depictions, and descriptions of nudity and sexual activity ...

verbal and written descriptions and audio sounds of a sexually oriented and erotic

nature ... "

25. All of this was very different from the misrepresentations that Defendant the

FOUNDATION and its principal and "alter ego" Swami Nithyananda had made to

Plaintiff in order to get him to pay $1.7 million for the FOUNDATION to keep the

Property. Plaintiffs consent to pay the $ 1.7 million had clearly been procured by

11

{00030447.DOC l

VERIFIED FIRST AMENDED COMPLAINT

Underline
Underline
Highlight
Highlight
Highlight
Page 9: FRAUD complaint against Nithyananda by  Ex-donor Popatlal Savla - Extracts

fraud, including intentional concealment and misrepresentations of the Defendants 2

3 and their principal Swami Nithyananda. Plaintiff would have never agreed to pay the

4 $1.7 million that he paid to the FOUNDATION for the Property had the Defendant

5 FOUNDATION and its principal and "alter ego" Swami Nithyananda and the other

6

7 individual Defendants and co-conspirators, to wit SADHANANDA and

8 V ALLABHANENI, honestly represented the goings on and true purpose and nature

9

10 ofthe FOUNDATION's vile activities.

11 26. On March 28, 2010, Swami Nithyananda, as the principal and authorized 12

13 representative of Defendant NITHY ANAND A agreed (in writing) to transfer

14 ownership of the Property to Plaintiff.

15 27. Once again, in early March 20 l 0 and around the beginning of April 20 l 0, 16

17 Swami Nithyananda, on behalf of himself and on behalf of the Defendant

18 FOUNDATION, personally and through his managing agent, Sri Nithya 19

20 Bhaktananda, agreed to surrender ownership of the Property to Plaintiff. Since

21 October 19, 2007, the ownership of the Property has been in the name of the

22 Defendant FOUNDATION.

23

24 28. Despite Plaintiffs demand for title to the Property, the Defendant

25 FOUNDATION has failed to convey full and clear title to Plaintiff, which has, in

26

27 part, necessitated that Plaintiff bring this lawsuit and include causes of action for

28 specific performance and quiet title.

12

{00030447DOC)

------------- -------------------------- ---------------VERIFIED FIRST AMENDED COMPLAINT

Underline
Underline
Highlight
Highlight
Highlight
Highlight
Highlight
Highlight
Page 10: FRAUD complaint against Nithyananda by  Ex-donor Popatlal Savla - Extracts

29. On August 10, 2010, Plaintiff recorded a Notice of Pending Action against the 2

3 Property. A copy of said document is attached hereto as Exhibit B.

4 30. In conversations in early March 2010 and around the beginning of April 2010,

5 Swami Nithyananda personally admitted to Plaintiff that the Defendant

6

7 FOUNDATION owed the Property to Plaintiff because Plaintiff had paid over $1.7

8 million to the Defendant FOUNDATION for the specific purpose to keep the

9

10 Property, and admitted to Plaintiff that such payments from him had been procured in

II reliance ofthe misrepresentations of the Defendant FOUNDATION and its principal, 12

13 namely Swami Nithyananda, to Plaintiff. Specifically, Swami Nithyananda admitted

14 to Plaintiff in two separate conversations in March and April 2010 that the Defendant

15 FOUNDATION never had any intention to start a Vedic University at the site of the

16

17 property to serve as a campus to teach Hinduism, Buddhism, Jainism, Sikhism and

18 Vedic science, or train several hundred of clerics in the religion of the Defendant 19

20 FOUNDATION, as Swami Nithyananda himself had personally misrepresented to

21 Plaintiff in 2007 here in California in order to lure Plaintiff into making over $ l. 7

22 million in payments directly for the benefit of the Property and in order to reduce its

23

24 first deed of trust obligations to the mortgagor of record, Positive Investments, Inc.

25 Swami Nithyananda also admitted in April 2010 to the existence of the Non-26

27 Disclosure Agreement and the Addendum.

28

13

{00030447.DOC}

----------------- ----VERIFIED FIRST AMENDED COMPLAINT

Underline
Underline
Underline
Highlight
Highlight
Highlight
Page 11: FRAUD complaint against Nithyananda by  Ex-donor Popatlal Savla - Extracts

2

3

55. In October 2007, Swami Nithyananda met with Plaintiff at 928 Huntington

Drive, in Duarte, California and again at the Property. Swami Nithyananda, as the

4 principal and alter ego of the FOUNDATION, personally reported to Plaintiff that the

5

6

7

8

9

FOUNDATION was going to start a Vedic University at the site of the Property

which would serve as a campus to teach Hinduism, Buddhism, Jainism, Sikhism, and

Vedic science and train several hundred clerics in the religion of the Foundation. As

the principal of the FOUNDATION, Swami Nithyananda had the authority to make 10

11 these representations on behalf of the FOUNDATION. Plaintiff reasonably 12

13

14

15

16

17

understood them to be binding obligations of the FOUNDATION and relied on them.

56. At the time Swami Nithyananda made these written representations, they were

known to be false by both him and the Defendant FOUNDATION.

57. The truth--which the FOUNDATION and its principal Swami Nithyananda

18 concealed--was that the FOUNDATION had no intention of opening a Vedic 19

20

21

22

23

24

25

26

27

28

University on the Property. Also, it intended to conceal its Non-Disclosure

Agreements and the vile, shameful and illegal activities referenced therein that it was

conducting, under the guise of a non-profit charitable foundation.

58. The FOUNDATION intended to induce Plaintiff to pay off the mortgage on

the Property, even though the FOUNDATION knew the inducement was

misrepresentations and lies.

19

{00030447 DOC)

VERIFIED FIRST AMENDED COMPLAINT

Underline
Highlight
Page 12: FRAUD complaint against Nithyananda by  Ex-donor Popatlal Savla - Extracts

59. Justifiably relying on the representations made by Swami Nithyananda on 2

3 behalf of and for the Defendant FOUNDATION, Plaintiff made payments in excess

4 of$1.7 million to the FOUNDATION. Plaintiffs reliance was reasonable in light of

5 the fact that the FOUNDATION and its principal, Swami Nithyananda, concealed the

6

7 Non-Disclosure Agreements which revealed the true purpose and activities of the

8 FOUNDATION, and concealed that neither the FOUNDATION nor its principal

9

10 were going to construct a Vedic University on the Property, as they had falsely

II misrepresented.

12

13 60. Plaintiff had no reason to anticipate that the Defendant FOUNDATION's

14 leader and agents would lie and intentionally misrepresent and conceal material

15 facts. Had Plaintiff known the true facts, he would have never made any payments to

16

the FOUNDATION, or associated himself with it or its leader and "alter ego" Swami 17

18 Nithyananda in any fashion. 19

20 61. Plaintiff did not learn about these misrepresentations and concealment until

21 March 2010.

22 62. As a result of the Defendant FOUNDATION's fraud and misrepresentations,

23

24 Plaintiff was damaged in an amount to be established at trial, but in a sum not less

25 than $1.7 million dollars, with 10% interest thereon from the dates of Plaintiffs

26

27 payments.

28

20

{00030447.DOC)

VERIFIED FIRST AMENDED COMPLAINT

Underline
Highlight
Page 13: FRAUD complaint against Nithyananda by  Ex-donor Popatlal Savla - Extracts

2

3

4

5

6

7

8

9

10

ll

12

13

63. In doing the acts alleged, the FOUNDATION acted with oppression, fraud,

malice, and in the conscious disregard of the rights of Plaintiff, and therefore Plaintiff

is entitled to punitive damages in an amount according to proof at the time of trial.

Absent punitive damages, the Defendant FOUNDATION will have no disincentive to

engage in this oppressive, fraudulent and malicious conduct again.

FIFfH CAUSE OF ACTION FOR RICO Conduct and Participation in a RICO Enterprise

through a Pattern of Racketeering Activity: 18 U.S.C. §§ 1961(5), 1962(c)

[Against Defendants SADHANANDA and V ALLABHANENI and DOES 10-20)

64. Plaintiff re-alleges each and every allegation as set forth above, and hereby

14 incorporates same by reference, as if all were set forth fully herein.

15 65. The fifth and sixth causes of action are complex civil actions for RICO 16

17 remedies authorized by 18 U.S.C. 1961 et seq.; for declaratory and injunctive relief;

18 for actual, consequential and exemplary damages; and for all other relief which this 19

20 Court deems just and proper under all circumstances which have occasioned this

21 cause of action. See 18 U.S.C. §§ 1964(a) and (c) ("Civil RICO").

22 66. Pursuant to 84 Stat. 947, Sec. 904, Oct. 15, 1970, the RICO laws itemized

23

24 below are to be liberally construed by this Court even though a liberal construction

25 rule was never codified in Title 18 of the United States Code. 26

27

28

21

{00030447.00C:}

VERIFIED FIRST AMENDED COMPLAINT

Highlight
Highlight
Page 14: FRAUD complaint against Nithyananda by  Ex-donor Popatlal Savla - Extracts

67. Section 1962 of Title 18 of the United States Code, The Racketeer Influenced 2

and Corrupt Organizations Act, (RICO) prohibits engaging in a pattern of 3

4 racketeering activity.

5 68. Under 18 U.S.C. section 1961 (l)(B), "racketeering activity" expressly

6

7 includes any act which is indictable under 18 U.S.C. section United States Code

8 sections 1341 and 1343 (relating to mail and wire fraud). 9

69. Specifically, it is indictable for any one to use the mails or wires to advance or 10

11 conceal a scheme to defraud. See 18 U.S.C., sections 1341, 1343.

12 70. The primary cause of the fifth and sixth causes of action is a widespread

13

14 criminal enterprise engaged in a pattern of racketeering activity across State lines,

15 and a conspiracy to engage in racketeering activity, involving multiple RICO

16

17 predicate acts during the past ten ( 1 0) calendar years.

18 71. The predicate acts cluster around Defendants SADHANANDA's and 19

20 VALLABHANENI's (the RICO Defendants) use of the mail and wires to advance

21 and conceal their scheme to defraud Plaintiff when Plaintiff made three payments to

22 the FOUNDATION on December 11, 2007, December 26, 2007 and December 18,

23

24 2008.

25 72.

26

At vanous times and places, the RICO Defendants conducted and/or

participated, either directly or indirectly, in the conduct of the affairs of said RICO 27

28

22

{ 0003044 1JXX)

VERIFIED FIRST AMENDED COMPLAINT

Underline
Underline
Highlight
Highlight
Highlight
Highlight
Highlight
Page 15: FRAUD complaint against Nithyananda by  Ex-donor Popatlal Savla - Extracts

2

3

4

5

6

7

8

9

10

ll

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

77. The RICO Defendants' misconduct was not an isolated incident because it

covers a span of years and these Defendants engaged in a long-term, on-going

scheme to defraud individuals who give money to the FOUNDATION and therefore

acted with a common purpose and had sufficient organization and continuity to

constitute an enterprise under RICO.

78. The RICO Defendants' conduct constitutes a "pattern of racketeering activity"

under 18 U.S.C., section 1961(5) because these Defendants continuing and ongoing

use of the mail and wires to advance their scheme to defraud Plaintiff and others who

gave money to the FOUNDATION and therefore manifested continuity and

relatedness involving more than two acts in violation of 18 U.S.C., sections 1341 and

1343.

79. Plaintiff has injury in fact arising from the RICO Defendants' racketeering

activity because Plaintiffs injuries were caused by the predicate acts (i.e., use of the

mail and wires to defraud) and therefore the damages Plaintiff suffered were

proximately caused by these Defendants' racketeering activity.

80. Plaintiffs loss of monies was an injury to "business or property" within the

meaning of RICO because the asserted RICO violation was the legal, and proximate

cause of Plaintiffs injuries, as well as the logical, and but for, cause.

81. Plaintiff sustained a cognizable and quantifiable injury to property.

Specifically, Plaintiff lost over $1.7 million.

24

{00030447.DOC)

VERIFIED FIRST AMENDED COMPLAINT

Underline
Underline
Highlight
Highlight
Page 16: FRAUD complaint against Nithyananda by  Ex-donor Popatlal Savla - Extracts

117. The FOUNDATION violated the fraudulent and unfair prongs of the 2

3 UCL because they had every intention of defrauding Plaintiff and others similarly

4 situated.

5 118. As a result, Plaintiff and others similarly situated were denied vested

6

7 property rights by the FOUNDATION.

8 119. The FOUNDATION generated--and continues to generate--gains as a

9

10 direct result of its unfair, unlawful and fraudulent business practices. Plaintiff and

II others similarly situated are therefore entitled to ( 1) restitution and/or to 12

13 disgorgement of any and ill-gotten gains obtained by the FOUNDATION as a result

14 of its UCL violations, (2) preliminary and permanent injunctive relief under

15 California Business and Professions Code, section 17200 et seq.; and (3) reasonable

16

17 attorney fees under Code of Civil Procedure, section 1021.5, and any other applicable

18 statutory provision.

19

20 PRAYER

21 WHEREFORE, Plaintiff respectfully prays for judgment against Defendants,

22 according to proof, as follows:

23

24 a. For general, special and non-pecuniary damages, in a sum in excess of the

25 jurisdictional minimum of this Court; 26

b. 27

For interest at the maximum legal rate;

28 c. For the amount of treble (triple) damages, with interest, under RICO;

33

{ 0003044 7 .DOC}

VERIFIED FIRST AMENDED COMPLAINT

Underline
Highlight
Page 17: FRAUD complaint against Nithyananda by  Ex-donor Popatlal Savla - Extracts

2

3

4

5

6

7

8

9

10

II

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

d. For compensatory damages arising out of mental anguish, emotional distress,

personal humiliation, damage to Plaintiffs reputation and other non-economic

harms resulting from Defendants' conduct;

e. For reasonable attorneys' fees pursuant to Code of Civil Procedure, section

1 021.5; RICO and any other applicable statutory provision;

f. For an order requiring the FOUNDATION Defendant to specifically perform

under the Agreement, to execute all required documents to carry out the

Agreement, and to cause the conveyance of the Property to Plaintiff.

g. For an order declaring the rights of the parties in the Property.

h. For injunctive and restitutionary relief under the UCL;

l. For exemplary and punitive damages; and

J. For such other and further relief as the Court may deem just and proper.

Dated: December 14, 2010 SHENOIKOES

{00030447.DOC}

By: ~l~~-

34

Allan A. Shenoi For Plaintiff POP A TLAL K. SA VLA

VERIFIED FIRST AMENDED COMPLAINT

Page 18: FRAUD complaint against Nithyananda by  Ex-donor Popatlal Savla - Extracts

2:02PM

04105110

Accruaf Basis

Nithyananda Foundation Profit & Loss

January 1, 2005 through AprilS, 2010

Ordinary lnc:omeiExpense Income

-4 • Contributed support -4020 • Donations - General -4030 • Donation - Community Projects -4032 · Donations -Temple Oper -40-40 • Donations - Ashram Project -40-45 • Donation_ShivUngam -4050 · Donation - Tour support -4-430 • Fundraising event revenue

T~I-4·Contributedsupport

5 · Earned revenues 5150 · Program Service Donations

5051·LBP 5052 ·ARSP 5053·NSP 505-4 · Healing Prayer Initiation 5055·DSP 5056 · Advanced Healers Initiation 5057 • Teachers Training 5058 · Program Revenue Other 5059 - Himalayan Meditation Camp 5060 · Organizer Conference

T~l5150 ·Program Service Donations

5153 • Ananda Galleria Donations 5310 - Interest-savings/short-term inv 5320 · Dividends & interest-securities 5335 - Rental Income 5-490 • Miscellaneous revenue

Total 5 · Earned revenues

Total Income

Gross Profit

Expense 7000 · Grant & contract expense

7020 · Grants to other organizations

Total 7000 · Grant & contract expense

7500 · Other personnel expenses 7510 • Fundralsing event expense 7520 . Accounting fees 7530 . legal fees 75-40 - ProfessionaiConsulting fees

Total7500 ·Other personnel expenses

8100 - Non-personnel expenses 8101 · Anand Galleria Costs 8102 · Cost of Prgm Rltd Svcs

01 · LBP (Life Bliss Program) a1 - Supplies b1- Travel

Jan 1, '05- Apr 5, 10

-456,577.30 482.8-49.93

60,566.50 3.018,752.18

148.089.00 19.530.50 36,701.00

-4,223.066.-41

105,617.52 33.2-49.77

283.-40-4.93 -47,839.59

120.779.27 12.-405.50 86.618.00 11.033.83

0.00 11.518.06

712,466.-47

190.322.47 67.263.54

5,120.66 795,191.81

75.51 -----------------------

10.538.19 2.236.82

1.770.440.46

5,993.506.87

5,993.506.87

995.163.00

995,163.00

13,546.11 1.682.80

77.210.78 25,5n.-43

118.012.12

52.566.06

Total 01 · LBP (Life Bliss Program) 12.775.01

02·NSP a2 ·Supplies 38,167.11 b2 ·Travel 13,451.08

Total 02 · NSP 51,618.19

Exhibit C Paget

Highlight
Highlight
Highlight
Page 19: FRAUD complaint against Nithyananda by  Ex-donor Popatlal Savla - Extracts

~02PM

OoWSI10

Acc:n.tal Basis

)

Nithyananda Foundation Profit & Loss

\

January 1, 2005 through AprilS, 2010

03·ARSP a3 · Supplies b3 ·Travel

Total 03 • ARSP

04 • DSP a4 • Supplies b4 ·Travel

Total 04 • DSP

05 • Advanced Healer a5 · Supplies

Total 05 • Advanced Healer

06 • Teachers Training a6 · Supplies b6 ·Travel 06 · Teachers Training· Other

Total 06 ·Teachers Training

07 · Discourses, Other a7 · Supplies b7 ·Travel

Total 07 · Discourses, Other

08 · Healers Initiation a8 • Supplies b8 ·Travel

Total 08 · Healers Initiation

Total 8102 · Cost of Prgm Rltd Svcs

8110 ·Supplies (Foundation related) 8120 · Materials & supplies 8130 ·Telephone & telecommunications 8140 · Postage, shipping, delivery 8150 ·Mailing services 8160 · Equip rental, repair & maint. 8170 ·Printing & copying 8180 · Books, subscriptions, reference 8100 · Non-personnel expenses • Other

Total8100 ·Non-personnel expenses

8200 • Ashram Operational Expenses 1210 • Rent. partdng, other occupancy 8211 ·Supplies (For Ashramltas) 8220 • Utilities

Total 8200 · Ashram Operational Expenses

8300 · Travel & meetings expenses 8310 ·Travel 8320 · Conference,conventlon,meetlng 8300 · Travel & meetings expenses - Other

Total8300 ·Travel & meetings expenses

8500 · Mise expenses 8501 · Bank Fees 8502 • Merchant Account Fees

8502-01 · Wells Fargo Credit Card Fees 8502-02 · Paypal fees 8502 · Merchant Account Fees ·Other

Total 8502 · Merchant Account Fees

Jan 1, '05- Apr 5, 10

1,942.47 2,652.41

4,594.88

34,629.29 11,834.91

46,464.20

4,582.83

4,582.83

90,008.33 2,031.34 1,000.00

93,039.67

34,655.86 31,656.69

66.312.55

6,478.72 1.071.20

7,549.92

286,937.25

64,967.93 1,798.22

10,682.42 6,044.77

441.97 16,558.09 8,725.54 8,930.98 1,089.00 ------------------------

458,742.23

134,977.00 11,450.75 21,083.24

167,510.99

13,102.13 2,096.58

201.74

6,872.09 3,012.55

774.81

15,400.45

3,986.65

10.659.45

Page2

Page 20: FRAUD complaint against Nithyananda by  Ex-donor Popatlal Savla - Extracts

2:02PM

04105110

Accrual Basis

Nithyananda Foundation Profit & Loss

January 1, 2005 through AprilS, 2010

8503 • Foreign Currency Fees 8503-01 • Per ham Deposit Fee 8503-02 • Conversion Fee 8503 • Foreign Currency Fees - Other

Total8503 ·Foreign Currency Fees

8510 • Interest expense -general 8520 • Insurance - norMHnployee

8521 - Hazard Insurance 8520 • Insurance - non-employee - Other

Total8520 ·Insurance- non-employee

8570 • Advertising expenses 8590 • Other expenses 8500 • Mise expenses -Other

Total 8500 - Mise expenses

8600 • Business expenses 8610 ·Bad debt expense 8650 • Taxes -other 8670 • Organizational (corp) expenses 8600 • Business expenses -Other

Total 8600 - Business expenses

Total Expense

Net Ordinary Income

Net Income

Jan 1. '05- Apr 5. 10

1,209.90 5.12 1.51

1,216.53

70,339.83

8,933.00 5,984.00

14,917.00

1,010.00 5,236.78 5,111.42

112,477.66

1,127.03 213.48

13,905.23 20.00

15,265.74

1.882.sn.19

4,110,934.68

4,110,934.68

Pagel

Highlight
Highlight
Highlight
Highlight