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Northwest $14,947,176, computed on the basis of auditor’s coupons
after giving credit for commissions earned. The following day
Hasman informed Belofsky that Northwest intended to file suit
against petitioner and petitioner’s corporations because,
Northwest maintained, petitioner had refused to cooperate or
comply with the Interim Agreement. Thereafter, on June 20, 1988,
Northwest filed a multicount complaint against petitioner
individually and against petitioner’s corporations for, among
other things, specific performance of the Interim Agreement,
breach of oral contract, express guaranty, fraudulent conversion,
unjust enrichment, imposition of a constructive trust, and
injunctive relief (Northwest litigation).16 In its complaint,
Northwest further alleged that petitioner had failed to comply
with the Interim Agreement by, inter alia, refusing to disclose
all of the bank and brokerage account records of petitioner and
his corporations. Throughout the Northwest litigation, Belofsky
represented both petitioner and his corporations.
Northwest decided to sue petitioner individually and to
include a fraudulent conversion count against him because
Northwest’s audit had revealed that substantial amounts of the
16 Petitioner, IL NA Tours, and Air America filed answers in
the Northwest litigation, but NY NA Tours, CA NA Tours, and SF NA
Tours did not. A default judgment was subsequently entered
against the latter three corporations.
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