Facts

On July 15, 2006, defendants Janna Lee, Jay Jang aka Jae Hong Jang, a real estate agent and BC Brokers Group Inc., defendant Jang's employer, placed an ad in the Korean Central Daily News' classified section offering to sell a retail clothing business known as "Hama Fashion," located at 7459 Melrose Avenue in Los Angeles, for $225,000. Plaintiff Janet Kim alleged that defendants represented the business in the ad as a clothing store that generated a monthly net profit of $30,000, with monthly gross revenue of $100,000.

On July 17, 2006, plaintiff met with defendants. At their meeting, plaintiff alleged defendants made the same representations as those in the ad and that defendant Lee further stated that the gross monthly revenue was $150,000. The defendants also indicated that the security system was in good working order when it was actually broken. The sink in the bathroom was also in disrepair and the store had suffered extensive floodwater damages approximately two years prior. However, these facts were not disclosed to plaintiff.

The plaintiff subsequently entered into a purchase agreement with defendants, which listed the gross monthly revenue as $80,000. The plaintiff also conducted a visual inspection from July 24 to July 30, 2006. In Aug. 2006, plaintiff took possession.

PLAINTIFF'S CONTENTIONS:
The plaintiff contended the defendants engaged in fraud, misrepresentation and failure to disclose.

DEFENDANTS' CONTENTIONS:
Defendant Lee contended no misrepresentations were made to plaintiff. Defendant Lee also contended that plaintiff inspected the business for a week before purchase and knew that the gross monthly revenue generated was $80,000.

Result

A default judgment was entered against defendants Jang and BC Brokers Group in the amount of $184,433. The jury returned a verdict in favor of defendant Lee.

Other Information

FILING DATE: May 2, 2006.