Sale of 5 San Antonio-location dental clinics’ assets prospects to fraud lawsuit versus Dallas customer


The homeowners of five dental clinics in San Antonio and Schertz bought the organization belongings to a Dallas company in 2016 for $3.5 million.

But acquiring consumer KP-SA Administration and principal Thang “Kido” V. Pham to spend has been like pulling tooth, say the sellers — firms owned by dentists Scott and Diana Malone of San Antonio.

The Malone providers this 7 days sued KP-SA Management and Pham for fraud, conversion — the unauthorized having of assets — and breach of contract in condition District Courtroom in San Antonio.

The clinics work below the identify Smiley Dental & Orthodontics.

Under conditions of the deal, KP-SA compensated $300,000 up front and financed the remaining $3.2 million with the Malones. The buy rate was comprised of virtually $3.2 million in goodwill, $160,000 in accounts receivable, $100,000 in stock and $80,000 in fixtures and tools.

KP-SA ought to have paid practically $3 million by now but has only paid out $781,140, the lawsuit alleges. The plaintiffs are trying to find far more than $3.8 million in damages and fascination.

The parties’ settlement grants the Malone organizations an instant correct to foreclose and choose possession of the collateral upon a default without having heading to court docket, the accommodate says.

In response to demand from customers letters and foreclosures notices, on the other hand, Pham “threatened to abscond and secret away all collateral” so the plaintiffs would never find it, the fit adds.

“Mr. Pham has consistently created these threats and just lately has reiterated that he has no dilemma with emptying all accounts and hiding all the collateral and products of the dental methods,” Scott Malone suggests in a declaration hooked up to the lawsuit.

To quit that from taking place, the Malone corporations received a short term restraining purchase that prevents the defendants from distributing any gains or eradicating home furniture and machines from the techniques.

It couldn’t be established if Pham or his reps opposed the request for the get. He could not be arrived at for remark Thursday. Austin legal professional John P. Ferguson, who signifies the Malone organizations, claimed he could not remark without his clients’ permission.

A listening to to increase the order right up until a demo is established for Jan. 24

The clinics, 4 in San Antonio and one in Schertz, experienced operated either as M&M Orthodontics or U Way too Dental & Orthodontics prior to the asset sale to KP-SA.

A Malone partnership ongoing to personal the clinics’ real estate, so it has been KP-SA’s landlord.

The clinics had been rebranded as Smiley Dental & Orthodontics following the asset sale closed. A further Dallas corporation, Smiley Dental Administration Co., has managed the tactics and receives 15 per cent of the revenue, whilst KP-SA receives 85 p.c of the revenue, the fit suggests. Smiley Dental has 31 areas in Texas, its web-site says.

Smiley Dental Administration is owned by Pham’s ex-spouse, dentist Lynh Thy Pham, the suit claims. It also is a defendant in the accommodate, accused of getting possession of the Malone companies’ collateral and working with the collateral while they remain unpaid. She did not right away answer to a ask for for remark.

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