SUN HON LIMITED v. JASON SCHUTZER, et al.

IN PART. The subpoenas shall be limited to records from the time period September 1, 2022 through September 26, 2024, to capture a period in which where Cruz may have repurchased the company shares. The Request for Sanctions in the Amount of $5,925 against Santa Maura Spice and Garlic Co., Inc. and Sheri Kanesaka, jointly and severally, is DENIED.

Petitioner Moises E. Cruz's Motion to Quash Respondent Santa Maura Spice and Garlic Co., Inc.'s Deposition Subpoena for Production of Business Records Issues to Frost Bank is GRANTED IN PART and DENIED IN PART. The subpoenas shall be limited to records from the time period September 1, 2022 through September 26, 2024, to capture a period in which where Cruz may have repurchased the company shares. The Request for Sanctions in the Amount of $5,925 against Santa Maura Spice and Garlic Co., Inc. and Sheri Kanesaka, jointly and severally, is DENIED.

SUN HON LIMITED, | Plaintiff, | Case No. |

| vs. JASON SCHUTZER, et al., | Defendants. | [TENTATIVE] RULING ON APPLICATION FOR RIGHT TO ATTACH ORDER Dept. 836 (Hon. Curtis A. Kin) | | | | | Plaintiff Sun Hon Limited moves for a right to attach order against defendant Jason Schutzer in the amount of $4,037,618.33. For the reasons that follow, the request is DENIED.

I.

Background

From October 2025 through February 2026, defendant Avalon Apparel LLC ("Avalon") submitted multiple purchase orders for apparel from plaintiff. (Liu Decl. P.P. 4-5 & Ex. A.) [1] These orders were fulfilled, and associated with each order, plaintiff issued an invoice to Avalon for the goods. (Liu Decl. P. 6 & Ex B.)

Based on plaintiff's accounting, the invoices totaled $4,037,619.43. (Liu Decl. P. 7 & Ex. C.) As represented by plaintiff, no one ever claimed that the products were not delivered or that the delivered products were not in conformity with the purchase orders. (Liu Decl. P. 18.) Indeed, plaintiff contends that Avalon has admitted to owing an outstanding balance of $4,037,619.43 to plaintiff. (Baum Decl. P. 8 & Ex. F.)

Despite having fulfilled its obligations, plaintiff has not received any payment from Avalon. (Liu Decl. P.P. 7, 15.) Due to this failure, Martin Liu, one of plaintiff's managers, communicated to defendant Jason Schutzer, whom plaintiff claims to be Avalon's principal owner, that plaintiff would cease future shipments and pursue legal action to recover the past-due balance if payments were not made. (Liu Decl. P.P. 10-11 & Ex. D.)

In response, Schutzer acknowledged Liu's frustrations and requested additional time. (Liu Decl. Ex. D.) Specifically, Schutzer stated: Martin I hear you and I plan to pay you as much as possible and I will add extra margin on new orders to help you. But please give me until next week when I'll have access to capital from new partner. Please be patient I offered to give him my small ownership in our building to pay you for old AP and I will personally pay you back from any money I earn on top of that... although that may be small I will do it for the rest of my life if I have to.

But I will try my best to get a big chunk of your old payable.. Suing won't help you it's just a waste of money for you guys as im in receivership, similar to a bankruptcy proceeding. You'd be suing a closed company. Trust me that I will work with new owner to get you a chunk of money and perhaps an LC. I will increase the prices on al[l] current POs to help. (Liu Decl. Ex. D.)

Liu understood this to mean that Schutzer was personally guaranteeing Avalon's payments. (Liu Decl. P. 11.) Plaintiff further contends that other oral statements were made to evidence the existence of a personal guaranty, although Schutzer rejects this notion. (Compare Liu Decl. P.P. 11-13 & Baum Decl. P.P. 3-7 with Schutzer Decl. P.P. 9-11, 14 & Hollander Decl. P.P. 3-10.)

II. Applicable Law

"Upon the filing of the complaint or at any time thereafter, the plaintiff may apply. . . for a right to attach order and a writ of attachment by filing an application for the order and writ with the court in which the action is brought." (CCP Sec. 484.010.)

The application shall be executed under oath and must include: (1) a statement showing that the attachment is sought to secure the recovery on a claim upon which an attachment may be issued; (2) a statement of the amount to be secured by the attachment; (3) a statement that the attachment is not sought for a purpose other than the recovery on the claim upon which the attachment is based; (4) a statement that the applicant has no information or belief that the claim is discharged or that the prosecution of the action is stayed in a proceeding under the Bankruptcy Act (11 U.S.C. Sec. 101, et seq.); and (5) a description of the property to be attached under the writ of attachment and a statement that the plaintiff is informed and believes that such property is subject to attachment. (CCP Sec. 484.020.)

The application for a writ of attachment must be supported "by an affidavit showing that the plaintiff on the facts presented would be entitled to a judgment on the claim upon which the attachment is based." (CCP Sec. 484.030.) The Court shall consider the showing made by the parties, as well as the pleadings and other papers in the record. (CCP Sec. 484.090(a), (d).)

The Court shall issue a right to attach order if it finds all of the following: (1) The claim upon which the attachment is based is one upon which an attachment may be issued. (2) The plaintiff has established the probable validity of the claim upon which the attachment is based. (3) The attachment is not sought for a purpose other than the recovery on the claim upon which the attachment is based. (4) The amount to be secured by the attachment is greater than zero. (CCP Sec. 484.090(a)(1-4).)

A claim has "probable validity" where it is more likely than not that the plaintiff will obtain a judgment against the defendant on that claim. (CCP Sec. 481.190.) "The Attachment Law statutes are subject to strict construction...." (Epstein v. Abrams (1997) 57 Cal.App.4th 1159, 1168.)

III.

Analysis

A. Evidentiary Objections

Schutzer objects to various portions of the Declaration of Leyi "Martin" Liu and the Declaration of Michael C. Baum. These objections are overruled in their entirety. Plaintiff objects to various portions of the Declaration of Garrick Hollander and the Declaration of Jason Schutzer. These objections are overruled in their entirety.

B. Basis of Attachment & Probable Validity of the Claim

"[A]n attachment may be issued only in an action on a claim or claims for money, each of which is based upon a contract, express or implied, where the total amount of the claim or claims is a fixed or readily ascertainable amount not less than five hundred dollars ($500) exclusive of costs, interest, and attorney's fees." (CCP Sec. 483.010(a).)

Here, the Court does not find that plaintiff can establish a valid basis for attachment or the probable validity of its contract claim, because the Court does not find on this record that it is more likely than not that plaintiff will establish that Schutzer entered into a valid agreement with plaintiff to guarantee Avalon's payment obligations.

Plaintiff's claim against Schutzer is based on an email sent by Schutzer on February 5, 2025, wherein Schutzer purportedly personally guaranteed the debt that Avalon owes to plaintiff. (Liu Decl., Ex. D.) There is no genuine dispute that Avalon owes plaintiff the principle sum of $4,037,619.43. (Liu Decl. P.P. 5-9 & Exs. A-C; Baum Decl., Ex. F.) Based on the record before it, however, the Court does not find that the evidence submitted establishes a basis for attachment against Schutzer pursuant to such purported guaranty.

The written promise upon which plaintiff relies states: Please be patient I offered to give him my small ownership in our building to pay you for old AP and I will personally pay you back from any money I earn on top of that... although that may be small I will do it for the rest of my life if I have to. But I will try my best to get a big chunk of your old payable. (Liu Decl. & Ex. D [Unedited].)

That email by Schutzer is reasonably read as Schutzer only committing to personally pay plaintiff in connection with Avalon's debt based on what profits Schutzer expected to receive from the sale of a building. As indicated by Schutzer, that deal never closed. (Schutzer Decl. P. 11.) The Court also notes Schutzer's statement that "I will do it for the rest of my life if I have to" is so hyperbolic that it substantially renders reliance on it unreasonable.

Further, as disclosed in an exhibit submitted with Liu's reply declaration, as part of that same email thread on February 6, 2026, Schutzer made clear his position that he had taken on no such legal obligation to guaranty Avalon's debts, stating: I will pay you $5000 from my income (if I have income) and im trying to sell my ownership in the building for 2mil to send to you. Legally I dont have to do any of that... im not doing it because I have to, im doing it because I feel it is my responsibility to make it up to you. You have been a great partner and I want to reward you as such with future very profitable and stable business as much as you can handle. The rest is me liquidating pretty much everything to pay you back... unless you would want to take over my ownership in our building in lieu of cash? (Liu Reply Decl. Ex. A [emphasis added].)

Viewed as a whole, Schutzer's statements do not evidence any valid and enforceable promise to personally guarantee Avalon's debt; rather, they are more reasonably read as statements to salvage a business relationship. [2]

Furthermore, this Court cannot find it is more likely than not that plaintiff will prevail on such breach of contract claim against Schutzer given the competing declarations from Schutzer and his bankruptcy counsel categorically refuting plaintiff's claims that Schutzer and his counsel had acknowledged such an obligation. (Compare Liu Decl. P.P. 11-13 & Baum Decl. P.P. 3-7 with Schutzer Decl. P.P. 9-11, 14 & Hollander Decl. P.P. 3-10.) Accordingly, the Court does not find that plaintiff has established a valid basis for attachment or demonstrated the probable validity of his claim for breach of a guaranty agreement by Schutzer.

IV.

Conclusion

The application for a writ of attachment against defendant Jason Schultzer is DENIED.

[1] From the various documents submitted to this Court, including his own declarations, it is not clear whether the name of plaintiff's manager is "Leyi 'Martin' Lui " or "Leyi 'Martin' Liu." Based on frequency and use, the Court has opted to use "Liu" and means no disrespect if the Court has guessed his true name incorrectly.

[2] As for the statement about liquidating assets, plaintiff asserts that this means Schultzer's personal assets to support his purported obligation to plaintiff. (Reply at 3:23-27.) It is not at all clear what Schultzer intended by this statement. | Home -->)" -->