1024-00003 · Driftwood Absolute Return Fund Ltd · Pleadings

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SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK COMMERCIAL DIVISION

DRIFTWOOD ABSOLUTE RETURN FUND LTD.,

Plaintiff,

-against-

MERIDIAN PRIME CAPITAL LLC, VIKTOR ANDREYEVICH ZELENKO, IRENE MARIA CARVALLO, and DMITRI PAVLOVICH SOBCHAK,

Defendants.

Index No. 654321/2023

ORDER TO SHOW CAUSE WITH TEMPORARY RESTRAINING ORDER AND ORDER OF ATTACHMENT

Before: Hon. Eleanor Vasquez, J.S.C.

I. ORDER TO SHOW CAUSE — PREAMBLE

Upon reading and considering the following papers submitted in connection with plaintiff's ex parte application for a temporary restraining order and order of attachment:

(1) The verified complaint of Driftwood Absolute Return Fund Ltd. ("Plaintiff" or "Driftwood"), dated August 7, 2023, and verified by Sandra Hu, Chief Operating Officer and Chief Compliance Officer of Driftwood Capital Management LP, the investment manager of Plaintiff;

(2) The memorandum of law in support of the ex parte application for a temporary restraining order and order of attachment, dated August 7, 2023;

(3) The affirmation of Priya Anand, Esq., of Calderwood & Harkness LLP, 200 Park Avenue, 42nd Floor, New York, New York 10166, counsel for Plaintiff, sworn to August 7, 2023, together with Exhibits A through R annexed thereto;

(4) The affidavit of Sandra Hu, Chief Operating Officer and Chief Compliance Officer of Driftwood Capital Management LP, the investment manager of Plaintiff Driftwood Absolute Return Fund Ltd., sworn to August 7, 2023, together with all exhibits annexed thereto; and

(5) The preliminary fund tracing analysis prepared by Kelvantis Forensic Advisors LLC, 101 Hudson Street, Suite 2500, Jersey City, New Jersey 07302, dated August 5, 2023, and annexed as Exhibit Q to the Anand Affirmation;

and the Court having determined, upon review of the foregoing submissions, that Plaintiff has demonstrated by clear and convincing evidence that immediate ex parte relief is necessary to prevent the dissipation of assets and to preserve the status quo pending a hearing on the merits, and that Plaintiff is likely to succeed on the merits of its claims for fraud, conversion, breach of fiduciary duty, unjust enrichment, and alter ego/veil-piercing as set forth in the verified complaint;

and it further appearing to the Court that Plaintiff has demonstrated that providing notice to defendants prior to the issuance of this Order would result in irreparable harm to Plaintiff, given defendants' demonstrated pattern of diverting funds to offshore accounts maintained outside the jurisdiction of this Court, transferring misappropriated assets to concealed entities and trust vehicles, and otherwise engaging in conduct designed to place stolen assets beyond the reach of creditors and this Court;

and the Court having considered the requirements of CPLR §§ 6201, 6210, 6211, 6212, and 6301, and having determined that each such requirement has been satisfied;

NOW, on the motion of Calderwood & Harkness LLP, attorneys for Plaintiff, IT IS HEREBY ORDERED as follows:

II. ORDER TO SHOW CAUSE — RETURN DATE AND SERVICE PROVISIONS

A. Return Date for Preliminary Injunction Hearing

Defendants Meridian Prime Capital LLC, Viktor Andreyevich Zelenko, Irene Maria Carvallo, and Dmitri Pavlovich Sobchak are hereby ORDERED TO SHOW CAUSE before this Court, at the courthouse located at 60 Centre Street, New York, New York, Part 49 (Commercial Division), on August 22, 2023, at 10:00 a.m., or as soon thereafter as counsel may be heard, why an order should not be entered:

(a) Continuing the temporary restraining order set forth herein as a preliminary injunction for the duration of this action, pursuant to CPLR § 6301;

(b) Continuing the order of attachment set forth herein for the duration of this action, pursuant to CPLR § 6211;

(c) Directing defendants to provide a full and complete accounting of all assets, funds, and property received from, or attributable to, Plaintiff Driftwood Absolute Return Fund Ltd.;

(d) Granting such other and further relief as this Court deems just and proper, together with the costs and disbursements of this application.

B. Service Requirements

Plaintiff shall serve a copy of this Order to Show Cause, together with all supporting papers, including the verified complaint, memorandum of law, affirmation of Priya Anand, Esq. with all exhibits, affidavit of Sandra Hu with all exhibits, and the Kelvantis Forensic Advisors LLC preliminary fund tracing analysis, upon each defendant by the following methods and within the following timeframes:

(i) Upon Meridian Prime Capital LLC: by personal service upon any officer, director, managing agent, or other authorized agent of Meridian Prime Capital LLC at 140 Broadway, Suite 3510, New York, New York 10005, on or before August 10, 2023;

(ii) Upon Viktor Andreyevich Zelenko: by personal service upon Viktor Andreyevich Zelenko at 425 East 58th Street, Apt. 32F, New York, New York 10022, on or before August 10, 2023;

(iii) Upon Irene Maria Carvallo: by personal service upon Irene Maria Carvallo at 88 Greenwich Street, Apt. 2704, New York, New York 10006, on or before August 10, 2023;

(iv) Upon Dmitri Pavlovich Sobchak: by personal service upon Dmitri Pavlovich Sobchak at 301 West 57th Street, Apt. 18B, New York, New York 10019, on or before August 10, 2023.

Sufficient service shall also be deemed effective if made upon any attorney who has appeared or entered a notice of appearance on behalf of any defendant in this action, provided such service is made within the time periods specified above.

Answering papers, if any, including any affidavits in opposition and memoranda of law, shall be served upon Plaintiff's counsel and filed with the Court on or before August 18, 2023.

Reply papers, if any, shall be served upon defendants or defendants' counsel and filed with the Court on or before August 21, 2023.

III. TEMPORARY RESTRAINING ORDER

Pending the hearing on the return date specified herein and until further order of this Court, it is hereby ORDERED that the following temporary restraints are imposed:

A. Restraint on Meridian Prime Capital LLC

Pending the hearing on the return date and further order of this Court, defendant Meridian Prime Capital LLC (EIN: 84-3217659), its officers, directors, members, managers, agents, servants, employees, attorneys, and all persons in active concert or participation with them who receive actual notice of this Order by personal service or otherwise, are hereby TEMPORARILY RESTRAINED AND ENJOINED from:

(1) Transferring, assigning, pledging, hypothecating, encumbering, dissipating, withdrawing, removing, secreting, or otherwise disposing of any assets, funds, securities, investments, or property of any kind or nature whatsoever, whether real, personal, or mixed, whether tangible or intangible, and whether held directly or indirectly, including but not limited to:

(a) All accounts maintained at Bridgemont Bank NA, 383 Madison Avenue, New York, New York 10179, in the name of or for the benefit of Meridian Prime Capital LLC, including without limitation Account No. XXXX-4738 and Account No. XXXX-9012, and any other accounts in whatever name held for the benefit of Meridian Prime Capital LLC;

(b) All accounts maintained at any other bank, financial institution, brokerage house, clearing firm, or custodian, wherever located, in the name of or for the benefit of Meridian Prime Capital LLC, including without limitation any prime brokerage accounts, margin accounts, and settlement accounts;

(c) All cash, cash equivalents, certificates of deposit, money market funds, treasury instruments, and other liquid assets;

(d) All securities, equities, bonds, options, futures, swaps, foreign exchange positions, and other derivative instruments;

(e) All accounts receivable, contract rights, and other choses in action;

(2) Destroying, altering, concealing, mutilating, shredding, deleting, overwriting, or otherwise disposing of any books, records, documents, correspondence, trade confirmations, account statements, ledgers, journals, financial records, tax returns, electronic communications (including emails, text messages, and instant messages), computer files, databases, or other records of any kind relating to the business or operations of Meridian Prime Capital LLC, or relating to Meridian Prime Capital LLC's dealings, transactions, or relationship with Driftwood Absolute Return Fund Ltd., Driftwood Capital Management LP, or any affiliated entity of Plaintiff;

(3) Creating any new entities, trusts, accounts, or other structures for the purpose of receiving, holding, or concealing assets;

(4) Altering, amending, or terminating any operating agreement, partnership agreement, or other organizational document of Meridian Prime Capital LLC.

B. Restraint on Individual Defendants

Pending the hearing on the return date and further order of this Court, defendants Viktor Andreyevich Zelenko (residing at 425 East 58th Street, Apt. 32F, New York, New York 10022), Irene Maria Carvallo (residing at 88 Greenwich Street, Apt. 2704, New York, New York 10006), and Dmitri Pavlovich Sobchak (residing at 301 West 57th Street, Apt. 18B, New York, New York 10019), and each of their respective agents, servants, employees, attorneys, nominees, designees, and all persons in active concert or participation with them who receive actual notice of this Order by personal service or otherwise, are hereby TEMPORARILY RESTRAINED AND ENJOINED from:

(a) All bank accounts, brokerage accounts, investment accounts, retirement accounts, and insurance policies held at any financial institution, wherever located;

(b) All interests in any real property, wherever located, whether held in the name of the individual defendant or through any entity, trust, nominee, or other arrangement;

(c) All interests in any entity, whether domestic or foreign, including but not limited to Castellan Realty Holdings LLC (EIN: 87-1548203), a Delaware limited liability company; Stellaris Trading Ltd. (BVI Registration No. 2043871), a British Virgin Islands company; and any other entity in which any individual defendant holds a direct or indirect interest;

(d) All interests in any trust, including but not limited to the Zelenko Family Irrevocable Trust dated April 8, 2021 (Tax ID: 86-6092411), whether as grantor, trustee, beneficiary, protector, or in any other capacity;

(e) All digital assets, cryptocurrency, virtual currency, and digital tokens of any kind, held at any exchange, custodian, wallet, or storage device, including without limitation Bitcoin, Ethereum, and stablecoins such as USDT and USDC, wherever held or maintained;

(f) All vehicles, vessels, aircraft, jewelry, fine art, collectibles, and other items of tangible personal property having a value in excess of $1,000;

(2) Destroying, altering, concealing, mutilating, shredding, deleting, overwriting, or otherwise disposing of any books, records, documents, correspondence, electronic communications (including emails, text messages, instant messages, and messages on encrypted platforms), computer files, hard drives, thumb drives, mobile devices, databases, or other records of any kind relating to their business dealings, personal finances, or their relationship with Meridian Prime Capital LLC, Driftwood Absolute Return Fund Ltd., or any related entity or person;

(3) Creating any new entities, trusts, accounts, or other structures for the purpose of receiving, holding, or concealing assets;

(4) Departing the jurisdiction of the United States with any assets, funds, or property, or causing any assets, funds, or property to be transferred outside the United States, except as expressly permitted by this Order.

C. Directive to Bridgemont Bank NA

Bridgemont Bank NA, 383 Madison Avenue, New York, New York 10179, upon service of a certified copy of this Order, shall immediately and without delay:

(1) Freeze and restrain all accounts, sub-accounts, and ancillary accounts maintained in the name of, or for the benefit of, Meridian Prime Capital LLC (EIN: 84-3217659), and shall not permit any withdrawals, transfers, wire transfers, ACH debits, ACH credits, check clearances, debit card transactions, or other disbursements of any kind from such accounts, except as expressly permitted by further order of this Court;

(2) Freeze and restrain all accounts, sub-accounts, and ancillary accounts maintained in the name of, or for the benefit of, Viktor Andreyevich Zelenko, Irene Maria Carvallo, or Dmitri Pavlovich Sobchak, whether individually, jointly, or in any other capacity, and shall not permit any withdrawals, transfers, wire transfers, ACH debits, ACH credits, check clearances, debit card transactions, or other disbursements of any kind from such accounts, except as expressly permitted by further order of this Court;

(3) Provide to Plaintiff's counsel, Calderwood & Harkness LLP, Attention: Priya Anand, Esq., 200 Park Avenue, 42nd Floor, New York, New York 10166, within five (5) business days of service of this Order, a complete and accurate written statement identifying all accounts held in the names of the foregoing parties, including: (a) account numbers; (b) the names and Social Security or Tax Identification numbers of all account holders and signatories; (c) current balances as of the date of service of this Order; (d) account type and date of opening; and (e) the names and contact information of any safe deposit boxes maintained by or for the benefit of any of the foregoing parties;

(4) Preserve all records and documents relating to the foregoing accounts, including without limitation account statements, transaction records, wire transfer records, cancelled checks, deposit slips, signature cards, account opening documents, beneficial ownership certifications, and any correspondence or communications with any of the foregoing parties, for a period beginning January 1, 2021, through the date of service of this Order.

D. Directive to Other Third-Party Financial Institutions

Upon service of a certified copy of this Order, any bank, brokerage, clearing house, financial institution, digital asset exchange, or custodian holding assets, accounts, or property in the name of, or for the benefit of, any defendant, or any entity owned or controlled by any defendant, including but not limited to:

(a) Palmetto International Bank Ltd., 302 Bay Street, Nassau, Bahamas;

(b) Marlowe Asset Management Trust Company of Delaware, 1201 North Market Street, Suite 1600, Wilmington, Delaware 19801;

(d) Castellan Realty Holdings LLC (EIN: 87-1548203);

(e) Stellaris Trading Ltd. (BVI Registration No. 2043871);

shall immediately freeze and restrain all such accounts and assets and shall not permit any withdrawals, transfers, disbursements, or other transactions without further order of this Court. Each such institution shall further provide to Plaintiff's counsel, Calderwood & Harkness LLP, Attention: Priya Anand, Esq., 200 Park Avenue, 42nd Floor, New York, New York 10166, within five (5) business days of service of this Order, a complete and accurate written statement identifying all accounts and assets held for the benefit of any defendant or any entity controlled by any defendant, including account numbers, current balances, and the identities of all account holders and signatories.

E. Scope and Limitations of the Temporary Restraining Order

Notwithstanding the foregoing restraints:

(1) This temporary restraining order does not prohibit any individual defendant from using funds reasonably necessary for ordinary and necessary living expenses, including food, housing, utilities, medical care, and transportation; provided, however, that no individual defendant shall expend more than Five Thousand Dollars ($5,000.00) per week for such purposes without making prior application to, and receiving the express written approval of, this Court. Any individual defendant seeking to expend living expenses in excess of the foregoing weekly limit shall submit an application to the Court, on notice to Plaintiff's counsel, setting forth in reasonable detail the nature and amount of the proposed expenditure and the source of funds to be used.

(2) This temporary restraining order does not prohibit any defendant from retaining counsel and paying reasonable attorneys' fees and costs for representation in this action; provided, however, that any such payment of attorneys' fees or costs shall be disclosed to Plaintiff's counsel in writing within three (3) business days of the date of such payment, including the amount paid, the source of funds used, and the identity of the payee.

(3) This temporary restraining order does not apply to any assets, funds, or property that a defendant demonstrates, to the satisfaction of this Court, are wholly unrelated to and were not derived, directly or indirectly, from any transactions with Plaintiff or the proceeds thereof.

IV. ORDER OF ATTACHMENT

A. Grant of Attachment

Pursuant to CPLR § 6201(3), which provides for attachment where a defendant has assigned, disposed of, encumbered, or secreted property, or removed it from the state, or is about to do any of such acts, with intent to defraud creditors or frustrate the enforcement of a judgment that might be rendered in plaintiff's favor, and pursuant to CPLR § 6201(1), which provides for attachment where a defendant is a foreign corporation or a non-domiciliary residing outside the state, and upon the showing made in the verified complaint, affirmation, affidavit, and supporting papers submitted herewith, it is hereby ORDERED that:

An order of attachment is granted in favor of Plaintiff Driftwood Absolute Return Fund Ltd. against the property and assets of defendants Meridian Prime Capital LLC, Viktor Andreyevich Zelenko, Irene Maria Carvallo, and Dmitri Pavlovich Sobchak, jointly and severally, in the total amount of FIFTY MILLION DOLLARS ($50,000,000.00), plus interest, costs, and disbursements.

B. Property Subject to Attachment

The following property is hereby levied upon and attached pursuant to CPLR Article 62:

(1) All funds, accounts, deposits, credits, debits, certificates of deposit, securities, and other property of every kind and description held by Bridgemont Bank NA, 383 Madison Avenue, New York, New York 10179, in the name of, or for the benefit of, Meridian Prime Capital LLC, Viktor Andreyevich Zelenko, Irene Maria Carvallo, or Dmitri Pavlovich Sobchak, whether held individually, jointly, or in any other capacity;

(2) All funds, accounts, deposits, credits, debits, certificates of deposit, securities, and other property of every kind and description held by any bank, brokerage, financial institution, or custodian within the State of New York in the name of, or for the benefit of, any defendant, whether held individually, jointly, or in any other capacity;

(3) All real property interests held directly or indirectly by any defendant within the State of New York, including but not limited to:

(a) The condominium unit located at 425 East 58th Street, Apt. 32F, New York, New York 10022 (Block 1365, Lot 1532), whether held in the name of Viktor Andreyevich Zelenko or any nominee, trust, or entity;

(b) The commercial unit located at 17 Wooster Street, Unit 3, New York, New York 10013 (Block 475, Lot 1003), whether held in the name of any defendant, through Castellan Realty Holdings LLC (EIN: 87-1548203), or through any other nominee, alter ego entity, or arrangement;

(4) All tangible and intangible personal property of any defendant within the State of New York, including but not limited to vehicles, artwork, jewelry, furniture, equipment, intellectual property, contract rights, accounts receivable, and general intangibles.

C. Direction to the Sheriff of the City of New York / City marshal

The Sheriff of the City of New York, or any City marshal duly appointed and authorized to act in the County of New York, is hereby directed to levy upon and attach the property described in Section IV.B of this Order in accordance with the provisions of CPLR Article 62 and to execute this Order of Attachment as provided by law.

As a condition of this attachment, and pursuant to CPLR § 6212(b), Plaintiff shall file an undertaking, by a surety authorized to execute undertakings in the State of New York, in the amount of Five Hundred Thousand Dollars ($500,000.00), within three (3) business days of the date of this Order. The undertaking shall be conditioned upon Plaintiff's payment to the defendants of all costs and damages, including reasonable attorneys' fees, that may be sustained by reason of the attachment if the defendants obtain judgment in this action, or if it is determined that the Plaintiff was not entitled to the attachment.

D. Recording of Attachment

Plaintiff is hereby authorized and directed to file and record a notice of attachment and/or notice of pendency with the New York County Clerk's Office and/or the Office of the City Register of the City of New York with respect to any real property identified as subject to attachment herein, including but not limited to:

(a) The condominium unit located at 425 East 58th Street, Apt. 32F, New York, New York 10022 (Block 1365, Lot 1532);

(b) The commercial unit located at 17 Wooster Street, Unit 3, New York, New York 10013 (Block 475, Lot 1003);

and with respect to any additional real property that Plaintiff identifies as being owned or controlled by any defendant within the State of New York. The County Clerk and/or City Register are directed to accept and record such notices upon presentment.

V. BASIS FOR EX PARTE RELIEF — FINDINGS OF THE COURT

This Court has reviewed the submissions of Plaintiff in support of this ex parte application and makes the following findings in support of the issuance of this Order without prior notice to defendants:

(1) Plaintiff has demonstrated, by clear and convincing evidence, that defendants Meridian Prime Capital LLC and its principals, Viktor Andreyevich Zelenko, Irene Maria Carvallo, and Dmitri Pavlovich Sobchak, engaged in a fraudulent scheme to defraud Plaintiff of approximately $47,300,000.00 by fabricating trade confirmations, account statements, and other financial records under the ISDA Master Agreement dated December 15, 2021 (2002 form) and associated Credit Support Annex entered into between Driftwood Absolute Return Fund Ltd. and Meridian Prime Capital LLC.

(2) The fraudulent scheme was perpetrated over a period of approximately eighteen (18) months, from approximately January 2022 through July 2023, during which time defendants misappropriated approximately $38,500,000.00 in margin deposits made by Plaintiff pursuant to the Credit Support Annex and approximately $8,800,000.00 in diverted foreign exchange settlement proceeds that were owed to Plaintiff under confirmed transactions.

(3) The last fabricated account statement provided by defendants to Plaintiff, dated June 30, 2023, reflected a purported account balance of $52,100,000.00. Upon independent investigation and verification, including direct inquiry to Bridgemont Bank NA, actual account balances held for the benefit of Meridian Prime Capital LLC at Bridgemont Bank NA were confirmed at only approximately $3,200,000.00, representing a discrepancy of approximately $48,900,000.00.

(4) The preliminary fund tracing analysis prepared by Kelvantis Forensic Advisors LLC demonstrates that defendants have engaged in a demonstrated pattern of diverting misappropriated funds to offshore accounts maintained at Palmetto International Bank Ltd. in Nassau, Bahamas; to trust vehicles including the Zelenko Family Irrevocable Trust dated April 8, 2021; and to real estate holding entities including Castellan Realty Holdings LLC and Stellaris Trading Ltd. in the British Virgin Islands. The tracing analysis identifies specific wire transfers from Bridgemont Bank NA to these offshore and concealed destinations, aggregating in excess of $32,000,000.00 during the relevant period.

(5) Defendants' pattern of systematic diversion of assets to jurisdictions and structures designed to frustrate creditor recovery creates a significant and imminent risk of further dissipation if advance notice of this application were provided to defendants. The Court finds that providing such notice would likely result in the immediate transfer, concealment, or destruction of assets and evidence, rendering any subsequent judicial relief ineffective.

(6) Ex parte relief is therefore warranted under the circumstances to preserve the status quo pending the preliminary injunction hearing scheduled for August 22, 2023, and to prevent the irreparable harm that would result from further dissipation of assets traceable to Plaintiff's misappropriated funds.

VI. ADDITIONAL PROVISIONS

A. Expedited discovery

Plaintiff is hereby authorized to serve expedited discovery upon defendants and upon relevant third parties, including but not limited to Bridgemont Bank NA, Palmetto International Bank Ltd., Marlowe Asset Management Trust Company of Delaware, Aldermere Private Capital Digital Asset Custody LLC, and any other financial institution or custodian identified in the course of this action, in connection with the identification, tracing, and preservation of assets. Such expedited discovery may include document demands, interrogatories, and subpoenas duces tecum, and responses shall be due within ten (10) days of service, notwithstanding any longer response period that might otherwise apply under the CPLR. Any motion to quash or for a protective order with respect to such discovery shall be returnable on or before the return date of this Order to Show Cause.

B. Contempt. Any person who violates any provision of this Order, or who aids, abets, counsels, or assists any other person in violating any provision of this Order, may be found in contempt of court pursuant to Judiciary Law § 753 and may be subject to sanctions, including but not limited to imprisonment and monetary fines, as provided by law. This Order shall be enforceable by contempt proceedings, supplementary proceedings, or any other proceedings available at law or in equity.

C. Modification. This Order may be modified, amended, or vacated upon application of any party, upon notice to all other parties and to the Court, on the return date specified herein or on such other date as the Court may set upon application of any interested party. Any application to modify or vacate this Order shall be made by order to show cause or by notice of motion, with supporting papers served upon all parties not less than three (3) business days before the return date of such application, unless the Court otherwise directs.

D. Continued Jurisdiction

This Court retains jurisdiction over this matter and over all persons and entities subject to this Order for all purposes relating to the enforcement, modification, interpretation, and implementation of the provisions hereof. Nothing in this Order shall be construed to limit this Court's authority to enter such additional orders as may be necessary and appropriate to effectuate the purposes of this Order and to protect the rights of the parties.

E. Service of Order on Third Parties

Plaintiff's counsel is authorized to serve copies of this Order upon any third party, including any financial institution, custodian, title company, or other person or entity, as may be necessary to effectuate the provisions of this Order. Service upon third parties may be effected by personal delivery, overnight courier, facsimile transmission, or electronic mail, and shall be effective upon receipt.

VII. SO ORDERED

This Order has been signed and entered by the Court on this date, and shall take effect immediately upon signing.

SO ORDERED.

________________________________________

Hon. Eleanor Vasquez, J.S.C. Supreme Court of the State of New York County of New York, Commercial Division

Dated: August 8, 2023 New York, New York

Entered: August 8, 2023

VIII. SUBMISSION BLOCK

Submitted by:

CALDERWOOD & HARKNESS LLP Attorneys for Plaintiff Driftwood Absolute Return Fund Ltd. 200 Park Avenue, 42nd Floor New York, New York 10166

By: ________

Priya Anand, Esq. Telephone: (212) 558-4000 Facsimile: (212) 558-3588

Email: panand@calderwoodharkness.com

Matter No.: 1024-00003

SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK COMMERCIAL DIVISION
DRIFTWOOD ABSOLUTE RETURN FUND LTD.,
Plaintiff,
-against-
MERIDIAN PRIME CAPITAL LLC, VIKTOR ANDREYEVICH ZELENKO, IRENE MARIA CARVALLO, and DMITRI PAVLOVICH SOBCHAK,
Defendants.
Index No. 654321/2023
ORDER TO SHOW CAUSE WITH TEMPORARY RESTRAINING ORDER AND ORDER OF ATTACHMENT
Before: Hon. Eleanor Vasquez, J.S.C.
I. ORDER TO SHOW CAUSE — PREAMBLE
Upon reading and considering the following papers submitted in connection with plaintiff's ex parte application for a temporary restraining order and order of attachment:
(1) The verified complaint of Driftwood Absolute Return Fund Ltd. ("Plaintiff" or "Driftwood"), dated August 7, 2023, and verified by Sandra Hu, Chief Operating Officer and Chief Compliance Officer of Driftwood Capital Management LP, the investment manager of Plaintiff;
(2) The memorandum of law in support of the ex parte application for a temporary restraining order and order of attachment, dated August 7, 2023;
(3) The affirmation of Priya Anand, Esq., of Calderwood & Harkness LLP, 200 Park Avenue, 42nd Floor, New York, New York 10166, counsel for Plaintiff, sworn to August 7, 2023, together with Exhibits A through R annexed thereto;
(4) The affidavit of Sandra Hu, Chief Operating Officer and Chief Compliance Officer of Driftwood Capital Management LP, the investment manager of Plaintiff Driftwood Absolute Return Fund Ltd., sworn to August 7, 2023, together with all exhibits annexed thereto; and
(5) The preliminary fund tracing analysis prepared by Kelvantis Forensic Advisors LLC, 101 Hudson Street, Suite 2500, Jersey City, New Jersey 07302, dated August 5, 2023, and annexed as Exhibit Q to the Anand Affirmation;
and the Court having determined, upon review of the foregoing submissions, that Plaintiff has demonstrated by clear and convincing evidence that immediate ex parte relief is necessary to prevent the dissipation of assets and to preserve the status quo pending a hearing on the merits, and that Plaintiff is likely to succeed on the merits of its claims for fraud, conversion, breach of fiduciary duty, unjust enrichment, and alter ego/veil-piercing as set forth in the verified complaint;
and it further appearing to the Court that Plaintiff has demonstrated that providing notice to defendants prior to the issuance of this Order would result in irreparable harm to Plaintiff, given defendants' demonstrated pattern of diverting funds to offshore accounts maintained outside the jurisdiction of this Court, transferring misappropriated assets to concealed entities and trust vehicles, and otherwise engaging in conduct designed to place stolen assets beyond the reach of creditors and this Court;
and the Court having considered the requirements of CPLR §§ 6201, 6210, 6211, 6212, and 6301, and having determined that each such requirement has been satisfied;
NOW, on the motion of Calderwood & Harkness LLP, attorneys for Plaintiff, IT IS HEREBY ORDERED as follows:
II. ORDER TO SHOW CAUSE — RETURN DATE AND SERVICE PROVISIONS
A. Return Date for Preliminary Injunction Hearing
Defendants Meridian Prime Capital LLC, Viktor Andreyevich Zelenko, Irene Maria Carvallo, and Dmitri Pavlovich Sobchak are hereby ORDERED TO SHOW CAUSE before this Court, at the courthouse located at 60 Centre Street, New York, New York, Part 49 (Commercial Division), on August 22, 2023, at 10:00 a.m., or as soon thereafter as counsel may be heard, why an order should not be entered:
(a) Continuing the temporary restraining order set forth herein as a preliminary injunction for the duration of this action, pursuant to CPLR § 6301;
(b) Continuing the order of attachment set forth herein for the duration of this action, pursuant to CPLR § 6211;
(c) Directing defendants to provide a full and complete accounting of all assets, funds, and property received from, or attributable to, Plaintiff Driftwood Absolute Return Fund Ltd.;
(d) Granting such other and further relief as this Court deems just and proper, together with the costs and disbursements of this application.
B. Service Requirements
Plaintiff shall serve a copy of this Order to Show Cause, together with all supporting papers, including the verified complaint, memorandum of law, affirmation of Priya Anand, Esq. with all exhibits, affidavit of Sandra Hu with all exhibits, and the Kelvantis Forensic Advisors LLC preliminary fund tracing analysis, upon each defendant by the following methods and within the following timeframes:
(i) Upon Meridian Prime Capital LLC: by personal service upon any officer, director, managing agent, or other authorized agent of Meridian Prime Capital LLC at 140 Broadway, Suite 3510, New York, New York 10005, on or before August 10, 2023;
(ii) Upon Viktor Andreyevich Zelenko: by personal service upon Viktor Andreyevich Zelenko at 425 East 58th Street, Apt. 32F, New York, New York 10022, on or before August 10, 2023;
(iii) Upon Irene Maria Carvallo: by personal service upon Irene Maria Carvallo at 88 Greenwich Street, Apt. 2704, New York, New York 10006, on or before August 10, 2023;
(iv) Upon Dmitri Pavlovich Sobchak: by personal service upon Dmitri Pavlovich Sobchak at 301 West 57th Street, Apt. 18B, New York, New York 10019, on or before August 10, 2023.
Sufficient service shall also be deemed effective if made upon any attorney who has appeared or entered a notice of appearance on behalf of any defendant in this action, provided such service is made within the time periods specified above.
Answering papers, if any, including any affidavits in opposition and memoranda of law, shall be served upon Plaintiff's counsel and filed with the Court on or before August 18, 2023.
Reply papers, if any, shall be served upon defendants or defendants' counsel and filed with the Court on or before August 21, 2023.
III. TEMPORARY RESTRAINING ORDER
Pending the hearing on the return date specified herein and until further order of this Court, it is hereby ORDERED that the following temporary restraints are imposed:
A. Restraint on Meridian Prime Capital LLC
Pending the hearing on the return date and further order of this Court, defendant Meridian Prime Capital LLC (EIN: 84-3217659), its officers, directors, members, managers, agents, servants, employees, attorneys, and all persons in active concert or participation with them who receive actual notice of this Order by personal service or otherwise, are hereby TEMPORARILY RESTRAINED AND ENJOINED from:
(1) Transferring, assigning, pledging, hypothecating, encumbering, dissipating, withdrawing, removing, secreting, or otherwise disposing of any assets, funds, securities, investments, or property of any kind or nature whatsoever, whether real, personal, or mixed, whether tangible or intangible, and whether held directly or indirectly, including but not limited to:
(a) All accounts maintained at Bridgemont Bank NA, 383 Madison Avenue, New York, New York 10179, in the name of or for the benefit of Meridian Prime Capital LLC, including without limitation Account No. XXXX-4738 and Account No. XXXX-9012, and any other accounts in whatever name held for the benefit of Meridian Prime Capital LLC;
(b) All accounts maintained at any other bank, financial institution, brokerage house, clearing firm, or custodian, wherever located, in the name of or for the benefit of Meridian Prime Capital LLC, including without limitation any prime brokerage accounts, margin accounts, and settlement accounts;
(c) All cash, cash equivalents, certificates of deposit, money market funds, treasury instruments, and other liquid assets;
(d) All securities, equities, bonds, options, futures, swaps, foreign exchange positions, and other derivative instruments;
(e) All accounts receivable, contract rights, and other choses in action;
(2) Destroying, altering, concealing, mutilating, shredding, deleting, overwriting, or otherwise disposing of any books, records, documents, correspondence, trade confirmations, account statements, ledgers, journals, financial records, tax returns, electronic communications (including emails, text messages, and instant messages), computer files, databases, or other records of any kind relating to the business or operations of Meridian Prime Capital LLC, or relating to Meridian Prime Capital LLC's dealings, transactions, or relationship with Driftwood Absolute Return Fund Ltd., Driftwood Capital Management LP, or any affiliated entity of Plaintiff;
(3) Creating any new entities, trusts, accounts, or other structures for the purpose of receiving, holding, or concealing assets;
(4) Altering, amending, or terminating any operating agreement, partnership agreement, or other organizational document of Meridian Prime Capital LLC.
B. Restraint on Individual Defendants
Pending the hearing on the return date and further order of this Court, defendants Viktor Andreyevich Zelenko (residing at 425 East 58th Street, Apt. 32F, New York, New York 10022), Irene Maria Carvallo (residing at 88 Greenwich Street, Apt. 2704, New York, New York 10006), and Dmitri Pavlovich Sobchak (residing at 301 West 57th Street, Apt. 18B, New York, New York 10019), and each of their respective agents, servants, employees, attorneys, nominees, designees, and all persons in active concert or participation with them who receive actual notice of this Order by personal service or otherwise, are hereby TEMPORARILY RESTRAINED AND ENJOINED from:
(1) Transferring, assigning, pledging, hypothecating, encumbering, dissipating, withdrawing, removing, secreting, or otherwise disposing of any assets, funds, securities, investments, or property of any kind or nature whatsoever, whether real, personal, or mixed, whether tangible or intangible, and whether held directly or indirectly, whether individually or jointly with any other person, or through any entity, trust, nominee, or other arrangement, including but not limited to:
(a) All bank accounts, brokerage accounts, investment accounts, retirement accounts, and insurance policies held at any financial institution, wherever located;
(b) All interests in any real property, wherever located, whether held in the name of the individual defendant or through any entity, trust, nominee, or other arrangement;
(c) All interests in any entity, whether domestic or foreign, including but not limited to Castellan Realty Holdings LLC (EIN: 87-1548203), a Delaware limited liability company; Stellaris Trading Ltd. (BVI Registration No. 2043871), a British Virgin Islands company; and any other entity in which any individual defendant holds a direct or indirect interest;
(d) All interests in any trust, including but not limited to the Zelenko Family Irrevocable Trust dated April 8, 2021 (Tax ID: 86-6092411), whether as grantor, trustee, beneficiary, protector, or in any other capacity;
(e) All digital assets, cryptocurrency, virtual currency, and digital tokens of any kind, held at any exchange, custodian, wallet, or storage device, including without limitation Bitcoin, Ethereum, and stablecoins such as USDT and USDC, wherever held or maintained;
(f) All vehicles, vessels, aircraft, jewelry, fine art, collectibles, and other items of tangible personal property having a value in excess of $1,000;
(2) Destroying, altering, concealing, mutilating, shredding, deleting, overwriting, or otherwise disposing of any books, records, documents, correspondence, electronic communications (including emails, text messages, instant messages, and messages on encrypted platforms), computer files, hard drives, thumb drives, mobile devices, databases, or other records of any kind relating to their business dealings, personal finances, or their relationship with Meridian Prime Capital LLC, Driftwood Absolute Return Fund Ltd., or any related entity or person;
(3) Creating any new entities, trusts, accounts, or other structures for the purpose of receiving, holding, or concealing assets;
(4) Departing the jurisdiction of the United States with any assets, funds, or property, or causing any assets, funds, or property to be transferred outside the United States, except as expressly permitted by this Order.
C. Directive to Bridgemont Bank NA
Bridgemont Bank NA, 383 Madison Avenue, New York, New York 10179, upon service of a certified copy of this Order, shall immediately and without delay:
(1) Freeze and restrain all accounts, sub-accounts, and ancillary accounts maintained in the name of, or for the benefit of, Meridian Prime Capital LLC (EIN: 84-3217659), and shall not permit any withdrawals, transfers, wire transfers, ACH debits, ACH credits, check clearances, debit card transactions, or other disbursements of any kind from such accounts, except as expressly permitted by further order of this Court;
(2) Freeze and restrain all accounts, sub-accounts, and ancillary accounts maintained in the name of, or for the benefit of, Viktor Andreyevich Zelenko, Irene Maria Carvallo, or Dmitri Pavlovich Sobchak, whether individually, jointly, or in any other capacity, and shall not permit any withdrawals, transfers, wire transfers, ACH debits, ACH credits, check clearances, debit card transactions, or other disbursements of any kind from such accounts, except as expressly permitted by further order of this Court;
(3) Provide to Plaintiff's counsel, Calderwood & Harkness LLP, Attention: Priya Anand, Esq., 200 Park Avenue, 42nd Floor, New York, New York 10166, within five (5) business days of service of this Order, a complete and accurate written statement identifying all accounts held in the names of the foregoing parties, including: (a) account numbers; (b) the names and Social Security or Tax Identification numbers of all account holders and signatories; (c) current balances as of the date of service of this Order; (d) account type and date of opening; and (e) the names and contact information of any safe deposit boxes maintained by or for the benefit of any of the foregoing parties;
(4) Preserve all records and documents relating to the foregoing accounts, including without limitation account statements, transaction records, wire transfer records, cancelled checks, deposit slips, signature cards, account opening documents, beneficial ownership certifications, and any correspondence or communications with any of the foregoing parties, for a period beginning January 1, 2021, through the date of service of this Order.
D. Directive to Other Third-Party Financial Institutions
Upon service of a certified copy of this Order, any bank, brokerage, clearing house, financial institution, digital asset exchange, or custodian holding assets, accounts, or property in the name of, or for the benefit of, any defendant, or any entity owned or controlled by any defendant, including but not limited to:
(a) Palmetto International Bank Ltd., 302 Bay Street, Nassau, Bahamas;
(b) Marlowe Asset Management Trust Company of Delaware, 1201 North Market Street, Suite 1600, Wilmington, Delaware 19801;
(c) Aldermere Private Capital Digital Asset Custody LLC;
(d) Castellan Realty Holdings LLC (EIN: 87-1548203);
(e) Stellaris Trading Ltd. (BVI Registration No. 2043871);
shall immediately freeze and restrain all such accounts and assets and shall not permit any withdrawals, transfers, disbursements, or other transactions without further order of this Court. Each such institution shall further provide to Plaintiff's counsel, Calderwood & Harkness LLP, Attention: Priya Anand, Esq., 200 Park Avenue, 42nd Floor, New York, New York 10166, within five (5) business days of service of this Order, a complete and accurate written statement identifying all accounts and assets held for the benefit of any defendant or any entity controlled by any defendant, including account numbers, current balances, and the identities of all account holders and signatories.
E. Scope and Limitations of the Temporary Restraining Order
Notwithstanding the foregoing restraints:
(1) This temporary restraining order does not prohibit any individual defendant from using funds reasonably necessary for ordinary and necessary living expenses, including food, housing, utilities, medical care, and transportation; provided, however, that no individual defendant shall expend more than Five Thousand Dollars ($5,000.00) per week for such purposes without making prior application to, and receiving the express written approval of, this Court. Any individual defendant seeking to expend living expenses in excess of the foregoing weekly limit shall submit an application to the Court, on notice to Plaintiff's counsel, setting forth in reasonable detail the nature and amount of the proposed expenditure and the source of funds to be used.
(2) This temporary restraining order does not prohibit any defendant from retaining counsel and paying reasonable attorneys' fees and costs for representation in this action; provided, however, that any such payment of attorneys' fees or costs shall be disclosed to Plaintiff's counsel in writing within three (3) business days of the date of such payment, including the amount paid, the source of funds used, and the identity of the payee.
(3) This temporary restraining order does not apply to any assets, funds, or property that a defendant demonstrates, to the satisfaction of this Court, are wholly unrelated to and were not derived, directly or indirectly, from any transactions with Plaintiff or the proceeds thereof.
IV. ORDER OF ATTACHMENT
A. Grant of Attachment
Pursuant to CPLR § 6201(3), which provides for attachment where a defendant has assigned, disposed of, encumbered, or secreted property, or removed it from the state, or is about to do any of such acts, with intent to defraud creditors or frustrate the enforcement of a judgment that might be rendered in plaintiff's favor, and pursuant to CPLR § 6201(1), which provides for attachment where a defendant is a foreign corporation or a non-domiciliary residing outside the state, and upon the showing made in the verified complaint, affirmation, affidavit, and supporting papers submitted herewith, it is hereby ORDERED that:
An order of attachment is granted in favor of Plaintiff Driftwood Absolute Return Fund Ltd. against the property and assets of defendants Meridian Prime Capital LLC, Viktor Andreyevich Zelenko, Irene Maria Carvallo, and Dmitri Pavlovich Sobchak, jointly and severally, in the total amount of FIFTY MILLION DOLLARS ($50,000,000.00), plus interest, costs, and disbursements.
B. Property Subject to Attachment
The following property is hereby levied upon and attached pursuant to CPLR Article 62:
(1) All funds, accounts, deposits, credits, debits, certificates of deposit, securities, and other property of every kind and description held by Bridgemont Bank NA, 383 Madison Avenue, New York, New York 10179, in the name of, or for the benefit of, Meridian Prime Capital LLC, Viktor Andreyevich Zelenko, Irene Maria Carvallo, or Dmitri Pavlovich Sobchak, whether held individually, jointly, or in any other capacity;
(2) All funds, accounts, deposits, credits, debits, certificates of deposit, securities, and other property of every kind and description held by any bank, brokerage, financial institution, or custodian within the State of New York in the name of, or for the benefit of, any defendant, whether held individually, jointly, or in any other capacity;
(3) All real property interests held directly or indirectly by any defendant within the State of New York, including but not limited to:
(a) The condominium unit located at 425 East 58th Street, Apt. 32F, New York, New York 10022 (Block 1365, Lot 1532), whether held in the name of Viktor Andreyevich Zelenko or any nominee, trust, or entity;
(b) The commercial unit located at 17 Wooster Street, Unit 3, New York, New York 10013 (Block 475, Lot 1003), whether held in the name of any defendant, through Castellan Realty Holdings LLC (EIN: 87-1548203), or through any other nominee, alter ego entity, or arrangement;
(4) All tangible and intangible personal property of any defendant within the State of New York, including but not limited to vehicles, artwork, jewelry, furniture, equipment, intellectual property, contract rights, accounts receivable, and general intangibles.
C. Direction to the Sheriff of the City of New York / City marshal
The Sheriff of the City of New York, or any City marshal duly appointed and authorized to act in the County of New York, is hereby directed to levy upon and attach the property described in Section IV.B of this Order in accordance with the provisions of CPLR Article 62 and to execute this Order of Attachment as provided by law.
As a condition of this attachment, and pursuant to CPLR § 6212(b), Plaintiff shall file an undertaking, by a surety authorized to execute undertakings in the State of New York, in the amount of Five Hundred Thousand Dollars ($500,000.00), within three (3) business days of the date of this Order. The undertaking shall be conditioned upon Plaintiff's payment to the defendants of all costs and damages, including reasonable attorneys' fees, that may be sustained by reason of the attachment if the defendants obtain judgment in this action, or if it is determined that the Plaintiff was not entitled to the attachment.
D. Recording of Attachment
Plaintiff is hereby authorized and directed to file and record a notice of attachment and/or notice of pendency with the New York County Clerk's Office and/or the Office of the City Register of the City of New York with respect to any real property identified as subject to attachment herein, including but not limited to:
(a) The condominium unit located at 425 East 58th Street, Apt. 32F, New York, New York 10022 (Block 1365, Lot 1532);
(b) The commercial unit located at 17 Wooster Street, Unit 3, New York, New York 10013 (Block 475, Lot 1003);
and with respect to any additional real property that Plaintiff identifies as being owned or controlled by any defendant within the State of New York. The County Clerk and/or City Register are directed to accept and record such notices upon presentment.
V. BASIS FOR EX PARTE RELIEF — FINDINGS OF THE COURT
This Court has reviewed the submissions of Plaintiff in support of this ex parte application and makes the following findings in support of the issuance of this Order without prior notice to defendants:
(1) Plaintiff has demonstrated, by clear and convincing evidence, that defendants Meridian Prime Capital LLC and its principals, Viktor Andreyevich Zelenko, Irene Maria Carvallo, and Dmitri Pavlovich Sobchak, engaged in a fraudulent scheme to defraud Plaintiff of approximately $47,300,000.00 by fabricating trade confirmations, account statements, and other financial records under the ISDA Master Agreement dated December 15, 2021 (2002 form) and associated Credit Support Annex entered into between Driftwood Absolute Return Fund Ltd. and Meridian Prime Capital LLC.
(2) The fraudulent scheme was perpetrated over a period of approximately eighteen (18) months, from approximately January 2022 through July 2023, during which time defendants misappropriated approximately $38,500,000.00 in margin deposits made by Plaintiff pursuant to the Credit Support Annex and approximately $8,800,000.00 in diverted foreign exchange settlement proceeds that were owed to Plaintiff under confirmed transactions.
(3) The last fabricated account statement provided by defendants to Plaintiff, dated June 30, 2023, reflected a purported account balance of $52,100,000.00. Upon independent investigation and verification, including direct inquiry to Bridgemont Bank NA, actual account balances held for the benefit of Meridian Prime Capital LLC at Bridgemont Bank NA were confirmed at only approximately $3,200,000.00, representing a discrepancy of approximately $48,900,000.00.
(4) The preliminary fund tracing analysis prepared by Kelvantis Forensic Advisors LLC demonstrates that defendants have engaged in a demonstrated pattern of diverting misappropriated funds to offshore accounts maintained at Palmetto International Bank Ltd. in Nassau, Bahamas; to trust vehicles including the Zelenko Family Irrevocable Trust dated April 8, 2021; and to real estate holding entities including Castellan Realty Holdings LLC and Stellaris Trading Ltd. in the British Virgin Islands. The tracing analysis identifies specific wire transfers from Bridgemont Bank NA to these offshore and concealed destinations, aggregating in excess of $32,000,000.00 during the relevant period.
(5) Defendants' pattern of systematic diversion of assets to jurisdictions and structures designed to frustrate creditor recovery creates a significant and imminent risk of further dissipation if advance notice of this application were provided to defendants. The Court finds that providing such notice would likely result in the immediate transfer, concealment, or destruction of assets and evidence, rendering any subsequent judicial relief ineffective.
(6) Ex parte relief is therefore warranted under the circumstances to preserve the status quo pending the preliminary injunction hearing scheduled for August 22, 2023, and to prevent the irreparable harm that would result from further dissipation of assets traceable to Plaintiff's misappropriated funds.
VI. ADDITIONAL PROVISIONS
A. Expedited discovery
Plaintiff is hereby authorized to serve expedited discovery upon defendants and upon relevant third parties, including but not limited to Bridgemont Bank NA, Palmetto International Bank Ltd., Marlowe Asset Management Trust Company of Delaware, Aldermere Private Capital Digital Asset Custody LLC, and any other financial institution or custodian identified in the course of this action, in connection with the identification, tracing, and preservation of assets. Such expedited discovery may include document demands, interrogatories, and subpoenas duces tecum, and responses shall be due within ten (10) days of service, notwithstanding any longer response period that might otherwise apply under the CPLR. Any motion to quash or for a protective order with respect to such discovery shall be returnable on or before the return date of this Order to Show Cause.
B. Contempt.  Any person who violates any provision of this Order, or who aids, abets, counsels, or assists any other person in violating any provision of this Order, may be found in contempt of court pursuant to Judiciary Law § 753 and may be subject to sanctions, including but not limited to imprisonment and monetary fines, as provided by law. This Order shall be enforceable by contempt proceedings, supplementary proceedings, or any other proceedings available at law or in equity.
C. Modification.  This Order may be modified, amended, or vacated upon application of any party, upon notice to all other parties and to the Court, on the return date specified herein or on such other date as the Court may set upon application of any interested party. Any application to modify or vacate this Order shall be made by order to show cause or by notice of motion, with supporting papers served upon all parties not less than three (3) business days before the return date of such application, unless the Court otherwise directs.
D. Continued Jurisdiction
This Court retains jurisdiction over this matter and over all persons and entities subject to this Order for all purposes relating to the enforcement, modification, interpretation, and implementation of the provisions hereof. Nothing in this Order shall be construed to limit this Court's authority to enter such additional orders as may be necessary and appropriate to effectuate the purposes of this Order and to protect the rights of the parties.
E. Service of Order on Third Parties
Plaintiff's counsel is authorized to serve copies of this Order upon any third party, including any financial institution, custodian, title company, or other person or entity, as may be necessary to effectuate the provisions of this Order. Service upon third parties may be effected by personal delivery, overnight courier, facsimile transmission, or electronic mail, and shall be effective upon receipt.
VII. SO ORDERED
This Order has been signed and entered by the Court on this date, and shall take effect immediately upon signing.
SO ORDERED.
________________________________________
Hon. Eleanor Vasquez, J.S.C. Supreme Court of the State of New York County of New York, Commercial Division
Dated: August 8, 2023 New York, New York
Entered: August 8, 2023
VIII. SUBMISSION BLOCK
Submitted by:
CALDERWOOD & HARKNESS LLP Attorneys for Plaintiff Driftwood Absolute Return Fund Ltd. 200 Park Avenue, 42nd Floor New York, New York 10166
By: ________
Priya Anand, Esq. Telephone: (212) 558-4000 Facsimile: (212) 558-3588
Email: panand@calderwoodharkness.com
Matter No.: 1024-00003

SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK COMMERCIAL DIVISION

DRIFTWOOD ABSOLUTE RETURN FUND LTD.,

ORDER TO SHOW CAUSE WITH TEMPORARY RESTRAINING ORDER AND ORDER OF ATTACHMENT

III. TEMPORARY RESTRAINING ORDER

IV. ORDER OF ATTACHMENT

VI. ADDITIONAL PROVISIONS

VII. SO ORDERED

SO ORDERED.

VIII. SUBMISSION BLOCK

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