This case was last updated from Los Angeles County Superior Courts on 06/06/2019 at 21:46:41 (UTC).

EDWIN MINASSIAN VS MICHAEL PANOSIAN, ET AL

Case Summary

On 08/16/2016 EDWIN MINASSIAN filed a Contract - Other Contract lawsuit against MICHAEL PANOSIAN. This case was filed in Los Angeles County Superior Courts, Burbank Courthouse located in Los Angeles, California. The Judges overseeing this case are OTHER DISTRICT JUDGE, LAURA A. MATZ and CURTIS A. KIN. The case status is Disposed - Judgment Entered.

Case Details Parties Documents Dockets

 

Case Details

  • Case Number:

    ****5533

  • Filing Date:

    08/16/2016

  • Case Status:

    Disposed - Judgment Entered

  • Case Type:

    Contract - Other Contract

  • Court:

    Los Angeles County Superior Courts

  • Courthouse:

    Burbank Courthouse

  • County, State:

    Los Angeles, California

Judge Details

Presiding Judges

OTHER DISTRICT JUDGE

LAURA A. MATZ

CURTIS A. KIN

 

Party Details

Plaintiffs, Respondents and Cross Defendants

MINASSIAN EDWIN

IBEENA MINASSIAN

MKM & GROUP ASSOCIATES INC. A

MINASSIAN IBEENA

Defendants, Cross Plaintiffs and Appellants

TOUGHBUILT INDUSTRIES INC.

PANOSIAN MICHAEL

Not Classified By Court

L.A. DEPOSITIONS INC.

MYERS PAMELA L.

HAYEK MABEL

O'TOOLE EILEEN K.

Attorney/Law Firm Details

Plaintiff and Cross Defendant Attorneys

LEVIK YARIAN ESQ

LEVIK YARIAN LAW OFFICES OF

Appellant Attorney

ESQ LEVIK YARIAN

Defendant and Cross Plaintiff Attorneys

STRADLING YOCCA CARLSON & RAUTH

LLOYD DOUGLAS DIX

 

Court Documents

Unknown

10/18/2018: Unknown

Unknown

10/24/2018: Unknown

Unknown

10/26/2018: Unknown

Minute Order

10/26/2018: Minute Order

Acknowledgment of Satisfaction of Judgment

11/5/2018: Acknowledgment of Satisfaction of Judgment

Acknowledgment of Satisfaction of Judgment

11/5/2018: Acknowledgment of Satisfaction of Judgment

Unknown

11/6/2018: Unknown

Unknown

1/8/2019: Unknown

Substitution of Attorney

4/11/2019: Substitution of Attorney

JUDGMENT BY DEFAULT BY COURT

11/9/2017: JUDGMENT BY DEFAULT BY COURT

JUDGMENT

11/9/2017: JUDGMENT

JUDGMENT

4/12/2018: JUDGMENT

Application and Order for Appearance and Examination

7/11/2018: Application and Order for Appearance and Examination

Application and Order for Appearance and Examination

7/17/2018: Application and Order for Appearance and Examination

Proof of Personal Service

7/18/2018: Proof of Personal Service

Proof of Personal Service

7/23/2018: Proof of Personal Service

Opposition

7/23/2018: Opposition

Reply

8/27/2018: Reply

11 More Documents Available

 

Docket Entries

  • 04/11/2019
  • Substitution of Attorney; Filed by EDWIN MINASSIAN (Plaintiff)

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  • 04/11/2019
  • Substitution of Attorney; Filed by IBEENA MINASSIAN (Cross-Defendant)

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  • 03/15/2019
  • Appeal Record Delivered; Filed by Clerk

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  • 01/08/2019
  • Appeal - Notice Court Reporter to Prepare Appeal Transcript (B293419;); Filed by Clerk

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  • 11/14/2018
  • Appeal - Reporter Appeal Transcript Process Fee Paid; Filed by MICHAEL PANOSIAN (Appellant); TOUGHBUILT INDUSTRIES, INC. (Appellant)

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  • 11/06/2018
  • Appeal - Notice of Default Issued; Filed by Clerk

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  • 11/05/2018
  • Acknowledgment of Satisfaction of Judgment; Filed by IBEENA MINASSIAN (Cross-Defendant); MKM & GROUP ASSOCIATES, INC., A (Cross-Defendant)

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  • 11/05/2018
  • Acknowledgment of Satisfaction of Judgment; Filed by IBEENA MINASSIAN (Cross-Defendant); MKM & GROUP ASSOCIATES, INC., A (Cross-Defendant)

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  • 11/05/2018
  • Acknowledgment of Satisfaction of Judgment; Filed by EDWIN MINASSIAN (Plaintiff)

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  • 11/05/2018
  • Acknowledgment of Satisfaction of Judgment; Filed by EDWIN MINASSIAN (Respondent)

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325 More Docket Entries
  • 10/19/2016
  • Answer; Filed by MICHAEL PANOSIAN (Defendant); TOUGHBUILT INDUSTRIES, INC. (Defendant)

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  • 10/19/2016
  • Answer (*ANSWER ORDERED STRICKEN BY ORDER OF JUDGE LAURA A. MATZ ON MAY 4, 2017* ); Filed by Attorney for Defendant

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  • 10/19/2016
  • Cross-Compl fld- No Summons Issued; Filed by Atty for Defendant and Cross-Compl

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  • 08/26/2016
  • Proof-Service/Summons; Filed by EDWIN MINASSIAN (Plaintiff)

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  • 08/26/2016
  • Proof-Service/Summons; Filed by EDWIN MINASSIAN (Plaintiff)

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  • 08/26/2016
  • Proof-Service/Summons; Filed by Attorney for Plaintiff

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  • 08/16/2016
  • Summons Filed

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  • 08/16/2016
  • Complaint filed-Summons Issued; Filed by null

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  • 08/16/2016
  • Summons; Filed by null

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  • 08/16/2016
  • Complaint filed-Summons Issued

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Tentative Rulings

Case Number: EC065533    Hearing Date: June 22, 2020    Dept: E

(1) MOTION FOR LEAVE TO WITHDRAW ADMISSIONS

(2) MOTION FOR RESTITUTION OF FUNDS PAID TO SATISFY A DEFAULT JUDGMENT

Date: 6/22/20 (3:30 PM)

Case: Edwin Minassian v. Michael Panosian et al. (EC065533)

TENTATIVE RULING:

I. BACKGROUND AND PRELIMINARY MATTERS

On February 7, 2017, pursuant to plaintiff Edwin Minassian’s motion, the Court ordered Requests for Admission admitted against defendants Michael Panosian and Toughbuilt Industries, Inc. (Anderson Decl. ¶ 5 & Ex. A.) Based on defendants’ failure to respond to discovery, including the Requests for Admission, the Court subsequently granted plaintiff’s motion for terminating sanctions and struck the answer filed by defendants. (See 5/4/17 minute order.) Ultimately, plaintiff obtained a default judgment against defendants for $235,541.58 and a 7% interest in Toughbuilt. (Anderson Decl. ¶ 14 & Ex. N.) The Court of Appeal reversed the judgment in a decision issued November 1, 2019, and ordered that the trial court grant defendants’ CCP § 473(b) motion for relief from default and permit them to file an Answer. (Anderson Decl. ¶ 18 & Ex R.) The remittitur issued December 3, 2019. (Anderson Decl. Ex. S.)

Pursuant to the Court of Appeal’s direction, the Court hereby vacates the entry of default against both defendants nunc pro tunc as of December 3, 2019. Accordingly, defendants’ unsigned Answer, filed February 4, 2020, shall be deemed filed as of that date upon their filing a signed Answer with the Court within 10 days hereof. The Court also deems defendants’ filings in this Court subsequent to issuance of the remittitur to have been filed on the dates they were submitted to the Court.

II. DEFENDANTS’ MOTION FOR LEAVE TO WITHDRAW ADMISSIONS

Defendants Michael Panosian and Toughbuilt Industries, Inc.’s Motion for Leave to Withdraw Admissions is GRANTED.

As an initial matter, the Court rejects plaintiff’s argument that the instant motion is untimely because it was filed on February 3, 2020, approximately three years from February 7, 2017, the date on which the Requests for Admission were deemed admitted. CCP § 2033.300 does not set forth any time limit to file a motion for leave to withdraw admissions. Moreover, because defendants have been in default for essentially the entire period after the requests for admissions were deemed admitted, defendants have been prevented from appearing in the action to request withdrawal of the admissions. (See Devlin v. Kearny Mesa AMC/Jeep/Renault, Inc. (1984) 155 Cal.App.3d 381, 385-86 [“A defendant against whom a default has been entered is out of court

and is not entitled to take any further steps in the cause affecting plaintiff's right of action.”].) Defendants’ only remedy was to move to set aside the default and terminating sanctions leading to the default, which they did. Within two months of the Court of Appeals issuance of the remittitur, defendants brought the instant motion, which this Court finds to be timely.

On the merits, the Court notes that, in the affidavit of fault submitted in support of defendants’ § 473(b) motion to set aside default, defendants’ former counsel Lloyd Douglas Dix avers that, while representing defendants, his wife experienced severe seizures beginning in June 2016, after which he delegated work to other attorneys who then failed to handle the representation of defendants. (Anderson Decl. ¶ 9 & Ex. I [11/15/17 Dix Decl. ¶¶ 5, 8, 9].) Former counsel believed that defendants were being adequately represented, but later discovered through plaintiff’s meet and confer efforts that the attorneys to whom he delegated representation of defendants failed to answer discovery. (Dix Decl. ¶ 12, 13.) Neither former counsel nor anyone acting on his behalf informed defendants that they failed to respond to discovery responses or that the Court had deemed admitted the Requests for Admission. (Dix Decl. ¶¶ 13, 15, 16.) Former counsel further averred that the failure to respond to discovery was solely his fault. (Dix. Decl. ¶ 20.)

The policy behind allowing withdrawal of admissions is to prevent “undeserved windfalls” and favor “resolution of lawsuits on the merits.” (Wilcox v. Birtwhistle (1999) 21 Cal.4th 973, 983.) Even though former counsel admits to stipulating to the order deeming the Requests for Admissions admitted, former counsel’s declaration explains that his preoccupation with his wife’s illness resulted in his complete failure to adequately supervise the attorneys charged with representing defendants and ultimate failure to oppose—indeed, his stipulation to accept—the Court’s decision deeming the Requests for Admissions admitted. Significantly, former counsel explains that defendants neither participated in nor were even aware of counsel’s failure to meet discovery obligations which led to the requests for admissions being deemed admitted. While the Court finds former counsel’s conduct (or lack of conduct, to be precise) shocking and worthy of reprove, the Court also finds that, under the circumstances, former counsel’s neglect in failing to respond to the Requests for Admission was excusable, or, at the very least, not clearly inexcusable. (New Albertsons, Inc. v. Superior Court (2008) 168 Cal.App.4th 1403, 1420–21 [“Because the law strongly favors trial and disposition on the merits, any doubts in applying section 2033.300 must be resolved in favor of the party seeking relief. Accordingly, the court's discretion to deny a motion under the statute is limited to circumstances where it is clear that the mistake, inadvertence, or neglect was inexcusable . . . .”].)

While it is also true that the Court of Appeal’s order reversing the default judgment does not discuss this Court’s order deeming the Requests for Admission admitted, it is clear that deeming requests for admission admitted here would effectively operate as a terminating sanction. For example, Requests for Admission Nos. 7-12 if deemed admitted would establish conclusively plaintiff’s claims that defendants agreed to provide plaintiff a 7% interest in Toughbuilt, a position in Toughbuilt, and a salary and commissions in exchange for plaintiff’s assistance in developing a cell phone for Toughbuilt. (Compare Motion, Exs. 1, 2 with Compl. ¶¶ 67-70.) The Court of Appeal has found that, based on the same attorney affidavit of fault, defendants are entitled to relief both from default and from the order granting terminating sanctions. (See Anderson Decl. Ex. S at pp. 11-13.) Where, as here, the order deeming requests for admission

admitted amounts to a terminating sanction and resulted from the same attorney fault that led to the order for terminating sanctions and entry of default, it would be an empty gesture for defendants to prevail on appeal with respect to the order for terminating sanctions and entry of default if the order deeming Requests for Admissions admitted were permitted to stand. (Matera v. McLeod (2006) 145 Cal.App.4th 44, 62 [“To vacate the defaults without reinstating defendants' answer would be an empty gesture.”].)

The Court also finds plaintiff would not be prejudiced by the withdrawal of admissions, because there is no showing that plaintiff could not otherwise proceed with discovery and prove the elements of his case.

For the foregoing reasons, the motion is GRANTED. Defendants Michael Panosian and Toughbuilt Industries, Inc.’s admissions to plaintiff Edwin Minassian’s Requests for Admissions, Set One are withdrawn. Defendants’ responses to the Requests for Admissions attached to the motion as Exhibits 1 and 2 are deemed the operative responses.

In the exercise of its discretion under CCP § 2033.300, the Court denies plaintiff’s request for reimbursement of costs. In this regard, the Court notes, as detailed below, that, in connection with the motion for terminating sanctions and other motions to compel discovery, the trial court imposed monetary sanctions, which were incorporated into the default judgment and paid by defendants.

III. DEFENDANTS’ MOTION FOR RESTITUTION OF FUNDS

Defendants Michael Panosian and Toughbuilt Industries, Inc.’s Motion for Restitution of Funds Paid to Satisfy a Reversed Default Judgment is GRANTED IN PART.

As discussed above, on April 12, 2018, default judgment was entered against defendants Michael Panosian and Toughbuilt Industries, Inc., awarding plaintiff Minassian $235,541.58 and a 7% ownership interest in Toughbuilt. On September 13, 2018, to avoid the time and expense of a judgment debtor examination, defendants satisfied the judgment by paying plaintiff $252,949 (which included 10% interest on the judgment) and by providing 376,367 shares of common stock of Toughbuilt. (Anderson Decl. ¶¶ 17, 18 & Exs. Q, S.)

Because the default judgment was reversed by the Court of Appeal, defendants are entitled to restitution under CCP § 908, which this Court is authorized to award. (Gunderson v. Wall (2011) 196 Cal.App.4th 1060, 1065 [recognizing a court whose order or judgment has been reversed has the “inherent power” to provide restitution under section 908].) In doing so, “[t]he fundamental rule guiding the court in [such] proceeding[s] [i]s, so far as possible, to place the parties in as favorable a position as they could have been in had the judgments not been enforced pending appeal.” (Ibid.)

The Court takes judicial notice of the declarations plaintiff Minassian and his counsel Trevor R. Hiddin submitted in support of the default judgment entered by the Court. Those declarations make clear that the $235,541.58 requested of and entered by the Court in its default judgment contained unpaid amounts awarded by the Court for fees and sanctions independent of plaintiff’s

claim for damages in the complaint. (See Minassian Decl. ¶¶ 38(a), (d) & (e) [filed 4/2/18]; Hindin Decl. ¶¶ 8, 11, 18 [filed 4/2/18].) Specifically, the default judgment encompasses: (1) $3,960 in monetary sanctions for defendants’ discovery violations, payable within 30 days of a 2/3/17 hearing (see 2/7/17 Order); (2) $860 in monetary sanctions for discovery violations, payable within 30 days of a 4/14/17 hearing (see 4/14/17 Minute Order); and (3) $21,040 and $220 in mandatory attorneys’ fees and costs under CCP § 425.16 to Minassian as the prevailing party on his special motion to strike the cross-complaint (see 4/21/17 Notice of Ruling). The orders imposing these fees and costs (totaling $26,080) were not appealed from and remain valid.

Accordingly, the Court finds that defendants are entitled to restitution in the amount of $226,869, which is based on the $252,949 defendants paid in satisfaction of the judgment on September 13, 2018 (Anderson Decl. ¶ 17 & Exs.Q, R, S), minus the aforementioned $26,080 in fees and costs to which plaintiff is still entitled. In addition, with respect to the $226,869 in restitution, the Court also finds that defendants are entitled to 10% interest from the September 13, 2018 date of satisfaction. The Court finds the 10% interest rate to fairly place the parties in the position they would have been had the judgment not been paid. Indeed, the Court notes in this regard that, if plaintiffs had instead prevailed on appeal and the judgment remained unsatisfied, plaintiff would have been entitled to the statutory post-judgment interest rate of 10% per annum on the unpaid award.

The Court additionally orders that, pursuant to CCP § 908, plaintiff return to defendants the 7% interest in Toughbuilt Industries, Inc., namely, the 376,367 shares of common stock.

For the foregoing reasons, the defendants’ Motion for Restitution is GRANTED IN PART. Plaintiff shall make such restitution as ordered herein within 15 days hereof.