Jin

I. FACTUAL AND PROCEDURAL BACKGROUND

In 2007, Jin founded Hoda Globe Company (HGC) to produce “solar electrical power generation equipment.” In exchange for convertible promissory notes, Kwok and Yu loaned HGC a total of $75,000 in 2008. Under the terms of the notes, HGC would be obligated to repay the loans with accrued interest if it failed to secure at least $1 million in equity financing by the end of the year. When HGC was unable to obtain such financing, Kwok and Yu repeatedly demanded repayment in 2009 and 2010. In May 2010, Jin3 advised Kwok and Yu that HGC was insolvent and its assets would be sold at auction later that month. According to Kwok and Yu, Jin and Larsen, both of whom were members of HGC’s board of directors, ignored their written requests for further details about this auction. On May 21, 2010, Kwok and Yu, represented by Cai and Schein & Cai LLP, filed an action against, among others, HGC, Jin and Larsen alleging causes of action for fraud, securities fraud, conversion, negligence and breach of contract (Santa Clara County Superior Court case No. 110CV172599, hereafter “Case No. 2599”). Kwok and Yu moved for a temporary protective order to block any…