Pop Top Corp sued Rakuten Kobo Inc. in a case that resulted in a judgment against Chandra four years ago, with additional attorney's fees awarded as discovery sanctions. Kobo levied Chandra's assets held at Charles Schwab, including accounts in the Wazoo Kalamazoo Living Trust and his Roth IRA, seeking to collect over $291,000 plus nearly $30,000 in attorney's fees from a defendant who "owns at least eight real properties" worth more than $5.2 million.
U.S. Magistrate Judge Ajay Krishnan found that Chandra's trust accounts fell under California Civil Procedure Code Section 700.160(b)(1) because they were maintained in his name, making court authorization for the levy unnecessary. The judge also rejected Chandra's claim that his Roth IRA was protected under Section 704.115(b), noting that given his substantial real estate holdings, "Chandra's IRA is not necessary to support him, his spouse, or his dependents in retirement."
Chandra had moved to quash the Schwab levy, arguing it violated state law requiring court orders for third-party accounts, while also claiming his retirement account was exempt from collection. Kobo sought authorization to liquidate the securities and payment of attorney's fees from the proceeds, with the court previously sanctioning Chandra for discovery violations and ordering him to pay Kobo's legal costs.
The ruling allows systematic liquidation starting with cash accounts and lower-value holdings before touching larger positions, with the court reducing Kobo's $34,971 fee request to $29,948 after finding excessive preparation time and duplicative partner oversight. The decision demonstrates courts' willingness to pierce asset protection strategies when debtors possess substantial alternative resources, potentially affecting how judgment creditors pursue collection against sophisticated debtors with multiple account structures.