Empire Trust LLC v. Cellura

OPINION & ORDER Empire Trust LLC (“Empire Trust”), ADMI Inc. (“ADMI”), Michael Ghiselli (“Ghiselli”), Bruce Houle (“Houle”), and Baynon International Corp. a/k/a Global Brands Capital Corp. (“GBCC”; collectively “Plaintiffs”) bring this Action against Joseph Cellura (“Cellura”), Emilia Cellura, Malibu 55 Inc. (“Malibu 55″), and three John Does (collectively “Defendants”) alleging various claims arising out of Defendants’ allegedly fraudulent conduct. (See generally Am. Compl. (Dkt. No. 17).) Before the Court is Defendants’ Motion to Disqualify counsel for Empire Trust, LLC, and Bruce Houle, Douglas Dollinger. (Not. of Mot. (Dkt. No. 32).) For the following reasons, Defendants’ Motion is granted. I. Background A. Factual Background As the Court explained in ruling on Plaintiffs’ request for a temporary restraining order, this case involves numerous allegations of fraud arising out of a complicated series of business transactions. (See generally Am. Compl.) At core, Plaintiffs allege that Cellura embezzled $17 million owed to Plaintiffs under a voting trust agreement governing the Parties’ shares in GBCC. (See Am. Compl.

7, 43-45.) Starting in January 2023, Plaintiffs allege that Cellura — who acted as trustee under the agreement and as CEO of GBCC — engaged in a series of unauthorized transactions where he transferred company funds to shell companies that he owned instead of disbursing them to Plaintiffs. (See, e.g., id. 65 (alleging unauthorized transfer of $7 million from ADMI to Malibu 55); id.