United States, Superior Court of the State of California for the County of San Francisco - Case # CGC-06-0455390
Jay Rothstein has not yet settled the judgment awarded against him in this case.
Below is a summary of the information contained in the court records.
Plaintiffs invested in Milk & Fashion in 2005. Plaintiffs soon after discovered prima facie support of the following:
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Jay Rothstein did not actually invest the money he repeatedly claimed to have invested towards the production of Milk & Fashion.
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Without informing investors or receiving their permission, Jay Rothstein used investor’s funds for both personal and company expenses unrelated to the movie’s production.
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Knowing he did not have enough money to start and finish production, Jay Rothstein secretly paid himself his full salary upfront out of investor’s funds.
- Despite repeated claims and assurances to the contrary, Jay Rothstein did not actually properly maintain accurate accounting records to track the film’s budget and the use of investor’s funds. His "accounting" was riddled with irregularities, inaccuracies, and inconsistencies. Significant amounts of the investor’s funds were never properly accounted for.
On August 21, 2006, after negotiations with Jay Rothstein proved a waste of time and a stall tactic, Plaintiffs filed a complaint in the Superior Court of the State of California for the County of San Francisco against Jay Rothstein and China Venture Films for:
On June 22, 2007, after seeing through the dishonest and deceptive practices and behavior of Jay Rothstein, the same court issued a default judgment against Jay Rothstein and China Venture Films for US$310,404.54 plus future interest.
The same court has denied 3 motions filed by Jay Rothstein and George M. Rush, his U.S. lawyer, to vacate the defaults. In denying the third motion to vacate the default, the same court awarded sanctions in Plaintiff's favor of US$4,200 against China Venture Films, Jay Rothstein, and their council of record, George M. Rush for wasting the court's time.
Jay Rothstein failed to honor his promissory note and personal guarantee for one of the Plaintiff's investments.
Jay Rothstein forced the Plaintiffs to serve him in China using the Hague Convention.
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Even though Plaintiff's served Jay Rothstein 7 ways and physically on 2 different dates, Jay Rothstein claimed he was aware of the lawsuit but was never properly served in China.
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George Rush, Jay Rothstein's U.S. lawyer, refused to accept service on his client's behalf. Jay Rothstein claimed he did not have an attorney or agent in the U.S.
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Jay Rothstein claimed he did not receive the email from Plaintiff's lawyer containing the service documents, also claiming he did not recognize the Plaintiffs' attorney's name or email address so deleted the email suspicious of it being spam.
- The Chinese government Ministry of Justice properly served Jay Rothstein twice at his home in China, and provided written proof of service.
- Jay Rothstein first claimed to the judge that this was not possible because he lived in a secure complex not open to the public so the China government could not serve him there.
- In his third attempt to vacate the default, Jay Rothstein miraculously remembered he was actually not in Shanghai on the day the first service occurred and changed his story accordingly. Jay Rothstein had a Chinese employee submit a declaration supporting his new version of events.
- In his third attempt to vacate the default, Jay Rothstein also miraculously remembered he was actually in the office the entire day when the second service occurred at his home address and changed his story accordingly. Jay Rothstein had another Chinese employee submit a declaration supporting his new version of events.
- Jay Rothstein claimed he was not intentionally avoiding service and would gladly accept service as he looked forward to having his chance to defend himself in court.
- The judge did the math and stated in the denial of Jay Rothstein's second motion to vacate default, "Defendant made a decision not to respond to the complaint even though plaintiff gave defendant a chance to do so. This is a not a case of mistake or excusable neglect. Defendant gambled and lost and must accept the consequences."
Jay Rothstein has not yet settled the judgment awarded against him in this case.
For more information, please see the following website operated by San Francisco's Superior Court of the State of California:
Certain important court documents are also attached for convenient downloading.