Tuesday, January 27, 2009

It's aWonderful Day in the Neighborhood!

Just in from John Tiedt:

All seven of our motions to quash were granted today. Heidi lost. Heidi’s new attorney showed up today and tried to get the court to continue the matter but the judge emphatically denied that request. The court decided to hear all 7 since Mr. Peabody showed up.

Do you hear that noise, Heidi? It's the sound of the other shoe getting ready to drop ...

Wednesday, January 21, 2009

Allow me to introduce …

As is well known, Heidi Diaz, founder and owner of the fraudulent business known as Kimkins, filed a petition for bankruptcy a mere two days before she was required to appear in court for a hearing on the motion to certify the class in the civil case pending against her. Those of us who have been closely following this case, as well as the lead council for the plaintiffs, John Tiedt, fully believe this action taken by Heidi Diaz is a blatant attempt on her part to manipulate the court system in her latest attempt to side-step the civil action being taken.

John has promised us that he will diligently fight any attempts on the part of Ms. Diaz to expand her fraud into the bankruptcy courts. One of the trademarks of a true expert is they recognize their areas of expertise and when they encounter a need beyond their own scope of practice they eagerly seek out wise counsel. John Tiedt is truly an expert. In this case, John has secured the services of one of THE top lawyers in the field of bankruptcy law in the State of California. This gentleman served as the Chair of the Los Angeles County Bar Association’s Bankruptcy Committee from 2005-2007. Currently he is vice chair of the Executive Committee of the Commercial Law and Bankruptcy Section of the Los Angeles County Bar Association. Among his many other affiliations he is a former Local Bankruptcy Rules Committee Chair for the Los Angeles County Bar Association Bankruptcy Law Committee. In other words, he is incredibly qualified to deal with this matter.

Friends – and Heidi – please meet Mr. Scott C. Clarkson, of Clarkson, Gore and Marsella.

Mr. Clarkson, thank you so very much for catching the vision that John shares with so many of us – the vision of holding Heidi Kimberly Diaz accountable for the devious actions that have brought harm to so many people.

Once again, Heidi … Game On.

No Gifts?

This question is asked on the bankruptcy documents that Heidi filed:

Q: List all gifts or charitable contributions made within one year immediately preceding the commencement of this case except ordinary and usual gifts to family members aggregating less than $200 in value per individual family member and charitable contributions aggregating less than $100 per recipient.

A: None

You mean to tell me that on the heels of a year of making almost two MILLION dollars (that you reported) that you didn't buy your children gifts? During the year you made over $100,000 - in which you had NO house payment - you didn't buy gifts for your children? Your grandchild? You claim both Dennis and Brandon as dependents on your bankruptcy, but you didn't gift either one of them? No car? No bed? No clothes? Oh. Maybe you consider all those things just like maintenance. You know, expenses. But you didn't list those things as expenses. I mean, $25 a month for clothing won't clothe 3 adults. If you DID ever buy Brandon a bed (I would certainly hope you did) it couldn't have been much of one, as your entire household goods is only valued at $1500 (are you sure you didn't leave at least one zero off that number?). Short of buying a used mattress (you can't sell used mattresses around here) you surely spent more than $200 on a bed. Maybe you just bought him an air mattress. Maybe you didn't include it in your household goods because it is, after all, HIS bed. Oh, but then you would have gifted it to him, wouldn't you?

I'm not buying it. And I bet the court won't, either.

Friday, January 16, 2009

And They Said It Couldn't Be Done

Hi, Heidi! Just in case you missed it ...

01/14/2009 - 8:30 AM DEPT. 04


Wednesday, January 14, 2009

Setting the Record Straight

Not being one unable to say they are mistaken, I would like to address this statement in my last post:

"Question: A petition under the Bankruptcy Act of 1898 or the Bankruptcy Reform Act of 1978 has previously been filed by or against the debtor, his/her spouse, an affiliate of the debtor, …yada, yada, yada …
Answer: NONE

She must have forgot those two other times, eh?"

I've been doing some studying. This particular question on the bankruptcy forms that Heidi filed falls under Local Rule 1015-2. Local rules apply to - well, local areas. They are rules specific to a particular jurisdiction.

This particular rule is asking about Related Cases - is this case related to any other bankruptcy proceedings, either current or within the three years prior to this current filing.

Heidi answered that question as none, which is correct. Her prior bankruptcies do not fit the criteria.

I apologize if any of you followed me down this bunny trail. Mea culpa, mea culpa, mea maxima culpa

Finer Points

Edited below - see note

I see that I need to clear a couple of things up and answer some questions here.

Her "here is the money I get to live on each month" income is not $11,666. That is her gross monthly income, before her business expenses. And the other is factored in to it all. After all her business expenses that she claims she has is taken out and all her living expenses that she claims she has are taken out, she STILL has over $1,000 a month. Call that go to town money. Blow money. Retirement fund, except she doesn't have one of those. Still far more than most people have at the end of the month.

Next thing, those taxes, I assume, are for 2007 AND 2008. I wonder if she has even gotten around to filing her taxes for 2007? Time will tell. At some point she will be required to produce her returns.

That $4,500+ in other expenses are broken out below that question - all those various business expenses, including bunches to Clexus. Wasn't the $400,000 she sent them just before the lawsuit was filed enough?

Didn't she claim repeatedly on her website for sure and in her depo as I recall that she had paid all those expenses in advance for like 2-3 years? Maybe it was in private emails and such. To Tippy maybe? Jeannie, if you're reading, send me a note and let me know, would you? Thanks.

Here is some more from my notes written during my first read through of the docs:

More stuff ….

This is just some of my notes that I’ve jotted down during the first reading.

She filed as an individual
Chap 11
Debts are mostly business debts
Largest Debt: State of CA Franchise Tax Board: $154,832
Student Loans
Dental Bill – wow – massive work - $9,200
Small credit cards
Large unsecured loan, with $4000 worth of collateral … total $26,724 – 22,724 unsecured (Edited to add: They have apparently reversed the numbers on here, as it has been documented that she put $4,000 down and the rest is on a note. In that case, the $22,724 would be secured. Maybe that's how she is going to defend against any "errors" in this paperwork - her lawyer is unfamiliar with matters of bankruptcy law)

Now is when it gets interesting …

Question: A petition under the Bankruptcy Act of 1898 or the Bankruptcy Reform Act of 1978 has previously been filed by or against the debtor, his/her spouse, an affiliate of the debtor, …yada, yada, yada …
Answer: NONE

She must have forgot those two other times, eh?

She signed that specific piece of paper declaring under penalty of perjury that it was true and correct. Oops!

She claims her household property has a value of only $1,500. Good thing she never bought Brandon a bed. That figure would have been MUCH higher then. I suppose it is possible if she has really old and beat up stuff. I’d think that flat screen television that hangs on the wall of her office would be worth more than that, but what do I know?

Personal wearing apparel is $200.00. She does say in the documents that she hasn’t had a fire, flood or other major event like that. I guess stretch pants and spandex are really cheap in California.

No money. Serious. $100 cash. $200 PayPal. $4 in another bank. She has definitely fallen on hard times here.

Here it says Halcyon is a joint venture or partnership – non-viable – value $1…

Of course there is the $52,698.01 in that trust account that is frozen and attached.

Doesn’t know the value of her Kimkins customer list … let me help you with that one, Heidi. You’ve burnt most of those folks and they are likely not candidates to join yet another diet scam, so I’d put that one at zero. I’m sure some other scammer would be willing to pay you a bit more than that, though, for that list …

A 2006 Toyota Corolla worth $4,000 – is that what the collateral is on the above note?

We need to check property values in her neighborhood – have they really declined 50% plus?

That’s it for now. The next section starts dealing with the creditors and I need to reread that slowly to make sure I get it right.

It's That Pesky Lawsuit, I Tell You!

Some details from Heidi's bankruptcy filing. I see what sticks out to me, but what sticks out to you?

Heidi claims $11,666 a MONTH in income from KK, and $8915 a month in operating expenses (sorry, have to wipe off my computer screen), minus $1748 in living expenses, leaving her $1003 a month. Now, this is AFTER her taxes and insurance on her house, her food, her $25 a month clothing allowance, her utilities, everything. I think most folks would WISH for that sort of monthly excess, don’t you?

And she swears, once again, that this is accurate information. We’ll see.

Now, this is the fun stuff. Her business statements.

Monthly gross income: $11,666
Office supplies: 167.00
Legal, Accounting and other Professional Fees: $4,166 - Cottle made his money for the year, I see. That might include her CPA and bookkeeper (or whatever that other guy did) from January until September.

$4,582 in other? I can’t wait to see what that is, can you?

Here it is!
Web Hosting: $583.00
Advertising: $667.00
Clexus: $833.00
Tech Support Services: $750.00
Forum Support Services: $416.00
Refunds: $167.00
Google Adwords: $1,166.00

Someone asked specifically about her California taxes ... according to Becky's blog, in Part One of her deposition she said she sent them $100,000. She either underestimated it by $$154,832, or she lied about sending the $100,000, or she is lying on her bankruptcy filing. I wonder which one it will turn out to be ...

I would like to invite any experts in bankruptcy to comment on this matter.

There is much more in these documents. Stay tuned.

Tuesday, January 13, 2009

Can a Leopard Change Spots?

Apparently not, at least if that leopard's name happens to be Heidi K. Diaz.

I find myself in possession of a full copy of her bankruptcy filing from yesterday. It is very enlightening. I have only a few moments at this minute to get this up, but for now I will give you a glimpse into what I see ...

1. Cottle is NOT listed as a creditor, so she has paid him in full.

2. Heidi, Heidi, Heidi ... when you were sending off that tax check to the IRS just before the lawsuit was filed, why, why, why did you ignore the State of California? Didn't you realize that they were gonna want a whole big giant chunk of money from you?

3. The drop in the housing market must have hit her pretty hard. Or so she thinks. She estimates her house to be worth $200,000. Didn't she pay something like $400,000 for it? Oh, and there's that little tax thing again. It would be awful for that place to be sold at a tax sale ...

4. Her divorce lawyer (who isn't known in any bankruptcy lawyer circles in CA apparently) who subspecializes in bankruptcy DID get a pretty good sized retainer. And is pretty pricey to boot. Of course, $5,000 is a drop in the bucket for a successful business owner such as herself.

I've check with my own legal counsel on this - ALL of this information is public record now that it has been filed. Gosh, Heidi - do you really think it was wise to LIE on a document we all were gonna see and have enough documentation to put you away?

Or, I bet you didn't bother to read the fine print at the bottom - right by where you signed you name. You signed a statement that says, "I declare under penalty of perjury that the information provided in this statement is true and correct." You remember that part?

Well, how about the part that says, "Penalty for making a false statement: Fine up to $500,000 or imprisonment for up to 5 years or both. 18 U.S.C. Sections 152 and 3571."

Bless your heart. Have you forgotten that you have now moved yourself up into FEDERAL court?

Later tonight I will detail some of those lies ...

Out of the hat comes ...

There is lots of new Heidi news ... like, NEWS FLASH news. I really thought I needed a song or a strong photo to set the stage for this, so I went hunting. Before I get to the really big news ... serious stuff, folks! ... I want to share what I found. Not exactly what I was looking for, but it does sort of remind me of the last year I've spent on this thing. From the looks of things, I'm not done yet, either. Be sure to see below for the Heidi news ...

Ok. On with the news.

By now, most of you have heard that Heidi made a really underhanded move yesterday. TWO DAYS before the hearing for the class certification of our lawsuit, Heidi filed for bankruptcy. What's the big deal you may ask? Well, it puts the breaks on everything real fast. All court proceedings against her are halted. Dead in the water? Hardly. Though I'm quite certain Heidi thinks so. Stalled? Most definitely. Of course, as Deedlyn pointed out at LCF ... fraudulent filings of bankruptcies to avoid other lawful court action is not taken lightly. Heidi may very well have put herself in that orange jumpsuit we have been waiting for her to model for us.

Oh, but there's more.

A new diet website has popped up on the scene. Simple Choices Diet. It is a diet that appears to work on exchanges, rather like the diet the American Diabetes Association publishes. Each recipe on her site breaks out the nutritional data in exchanges (so many starches, so many fats, so many fruits, and so many proteins). Here is how she is positioning it: "Simple Choices is a fresh alternative to dieting and permanent weight loss. The focus is on fast weight loss using real food with no carb or calorie counting. Members receive flexible portions, expert help, delicious recipes and community forum support. Dieters will be treated to an easy to follow way to lose weight fast." Oh, yes. All of those tags that we have come to know and love are all there still: lose weight fast,fast weight loose,low carb diet,low fat diet,low glycemic diet,gastric surgery diet,lose stomach fat,lose weight after baby,online diet,cheap diet,easy diet,loose belly fat,lose 100 pounds,lose belly fat,quick weight loss. There is an extensive Google store that makes it very clear that she is turning her back on the diet plan that made her millions, in a deluded attempt to go more mainstream.

So, how do I KNOW this is Heidi Diaz at work, and not just some soul who is trying to make a buck - sort of like the Magic Chicken Diet? Heidi, you may want to listen up to this ... I hold in my hand absolute proof this is you. You think you are so smart, but you really aren't. I have a piece of paper - one from a very legitimate financial organization.

Heidi is quickly going to face problems on several fronts. First and foremost she is going to have to convince a judge that she is broke and can't pay her bills. Of course, she will have to explain to that judge why she just realized that two days before our hearing. And days before her court date with the City of Corona. She will also have to explain how she is so broke that she set up this website, has started paying for Google Ads for that site, and is still spending thousands of dollars a month on advertising for Kimkins.

Of course, she is also going to have to deal with that pesky little matter of trademark violation. The company who owns the trademark on your name, Heidi, was VERY interested in all the little details. That piece of paper I have will make sure that you can't claim it isn't you. Every photograph, every paragraph, every article you put up on that site are being scrutinized, too. You have such a propensity to lift things that aren't yours and use them for your own financial gain. did I say that company? I meant the general counsel of that company.

Hopefully this one won't take a year ...