A Larchmont physician and his wife who tried to develop a medical marijuana enterprise are being challenged over the accuracy of their personal finances in a bankruptcy case.
Lee T. Owens of Tacoma, Washington is asking federal bankruptcy court, White Plains to stop Edwin X. Vicioso, an anesthesiologist, and Ann M. Anderson from getting out of paying a $1.5 million debt.
The couple “should be denied discharge and their bankruptcy should be dismissed,” Owens states in an Oct. 3 adversary proceeding, “due to their abuse of (the) bankruptcy system … for the specific purpose of hindering litigation and defrauding creditors.”
“Dr. Vicioso and Ms. Anderson fervently deny the baseless allegations against them,” their bankruptcy attorney, Nicholas A. Pasalides, said in an email message, “and fully intend to vigorously defend themselves in court.”
Vicioso and Anderson painted a very different picture of their medical marijuana deal in a federal lawsuit filed last year in Seattle, accusing Owens and an attorney of fraud.
In January 2016, Owens sold his interest in L&D Holdings LLC — a company that held marijuana licensing rights – to the couple’s Green Kiss USA Inc. for $50,000 plus $2 million to be paid out quarterly over 10 years.
In Owens’ telling, the couple induced him to sell his interests in L&D by falsely stating that they would comply with Washington state laws and by misrepresenting their finances.
The couple “immediately began to grossly mismanage the company,” he alleges in the adversary proceeding, “culminating in the loss of the company’s facility and termination of its business license by the State of Washington less than six months after closing (the deal).”
In Vicioso’s and Anderson’s telling, they were interested in acquiring a license to produce cannabis and were put in touch with Seattle lawyer Ryan C. Espegard.
They claim that Espegard steered them to Owens, switched sides to represent Owens, and revealed their sensitive personal and financial information to help Owens drive up the price of the deal.
Owens knew that the couple was highly leveraged, that they had remortgaged their home, that Vicioso had left his medical practice, and that “they had no other option but for this venture to succeed,” they said.
Vicioso and Anderson claimed they spent more than $1.5 million in setting up and obtaining licensing for a state-of-the-art cannabis facility in Tacoma.
But in June 2016 the state shut down the facility for regulatory violations concerning financing and management.
The couple’s federal lawsuit was dismissed over a jurisdictional issue. Meanwhile, Owens sued Vicioso and Anderson in a Tacoma court, claiming breach of contract and other causes of action.
In April, Vicioso and Anderson filed a Chapter 11 reorganization petition. They claimed assets of $2.25 million, consisting mostly of their house on Chatsworth Avenue in Larchmont, and liabilities of $2.36 million.
Creditors have since filed nearly $4 million in claims, including an IRS debt of $1.7 million for unpaid income taxes and penalties.
Owens filed a claim for $1,558,751.
Now, in the adversary proceeding, he is accusing Vicioso and Anderson of misrepresenting their finances “to give the false impression that they are insolvent or suffering financial hardship.”
He claims his information is based on financial records his attorney obtained through the discovery process.
For instance, Owens claims that businesses the couple own make more than $18 million a year, not the $0 that they claim in bankruptcy. Their Larchmont house could be worth as much as $3.9 million, not the $2.15 million represented on a bankruptcy schedule.
Owens alleges that Vicioso’s medical practice made $782,586 in 2017 and paid $479,476, or 61% of total revenue, in management fees to a shell company operated by Anderson when the company had no other receipts. Then the couple allegedly transferred $213,000 from the shell company to their personal checking account.
The couple claimed no income from businesses in 2018, according to Owens, yet more than $900,000 was deposited in Vicioso’s medical practice checking account and more than $625,000 was deposited in the couple’s personal checking account.
Owens accuses the couple of making false statements in the bankruptcy filings, defalcation and malicious injury.
He is asking the court to declare that the debt they owe him may not be discharged, or alternatively, to appoint a trustee or an examiner to investigate his allegations.
Owens’ attorney in the adversary proceeding is Ryan C. Espegard.