State

$1.2M sought in defamation claim

The target of a car fraud investigation has filed a $1.2 million claim against Stanislaus County, charging defamation and racial discrimination.

Sheriff's deputies Dec. 16 seized 29 vehicles from the former Car Mart on Crows Landing Road, owned by Haythem "Mike" Attalla, 33, of Ceres.

Investors told The Bee that he and brothers Amel Attalla, who owned Crows Landing Auto Center, and Nafeel Attalla, who owned Car Zone, promised exorbitant returns but closed and lost $3.2 million of investors' money.

The Sheriff's Department and the California Department of Motor Vehicles confirmed a joint investigation related to car sales and lending practices.

The Bee has reported on eight lawsuits brought by auto brokers, former employees, a client and an investor, all claiming fraud or breach of contract.

Authorities "improperly associated" Haythem Attalla with his brothers, leading to the "illegal seizure" of the vehicles, which "had the effect of destroying the business," Modesto attorney Doug- las Neibauer wrote in the claim.

Haythem Attalla believes he was targeted because he is "of Assyrian ethnicity and not Caucasian," the claim reads. Authorities "violated numerous rules and regulations of the Sheriff's Department" by "leaking information" to The Bee that was "totally defamatory," causing "great embarrassment and humiliation," Neibauer wrote.

Attalla believes he faces "no pending criminal charges," the claim reads.

But sheriff's spokeswoman Gina Leguria said Tuesday the investigation is ongoing.

"Detectives are working cooperatively with the DMV to sort through mountains of paperwork involved with the case," Leguria said. "Mr. Attalla's claim that no criminal charges have been filed is correct as of today. With the pending investigation, we'll see what comes of that."

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