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This case was last updated from Los Angeles County Superior Courts on 01/14/2020 at 20:09:46 (UTC).

LONG FINANCIAL SERVICES INC ET AL VS THIRD EYE CAPITAL CORPO

Case Summary

On 02/29/2016 LONG FINANCIAL SERVICES INC filed a Contract - Other Contract lawsuit against THIRD EYE CAPITAL CORPO. This case was filed in Los Angeles County Superior Courts, Stanley Mosk Courthouse located in Los Angeles, California. The case status is Pending - Other Pending.

Case Details Parties Documents Dockets

 

Case Details

  • Case Number:

    ****2041

  • Filing Date:

    02/29/2016

  • Case Status:

    Pending - Other Pending

  • Case Type:

    Contract - Other Contract

  • Court:

    Los Angeles County Superior Courts

  • Courthouse:

    Stanley Mosk Courthouse

  • County, State:

    Los Angeles, California

 

Party Details

Plaintiffs and Petitioners

NELL INC.

LONG FINANCIAL SERVICES INC.

PANTHERA FILM FINANCE COMPANY INC.

ASLAN FINANCIAL GROUP INC.

Defendants and Respondents

HILL & BRAND PRODUCTIONS 7

HILLENBRAND DAVID

HILLENBRAND SCOTT

THIRD EYE CAPITAL CORPORATION

HILL & BRAND ENTERTAINMENT

HILL & BRAND FILMS 6

HILL & BRAND PRODUCTIONS LTD. 2

HILL & BRAND PRODUCTIONS 6

HILL & BRAND PRODUCTIONS INC.

STRATIVE CAPITAL LTD.

Attorney/Law Firm Details

Plaintiff and Petitioner Attorneys

MEYER LAW ORGANIZATION RLLP

FU EUGENE SOLOMON

FU EUGENE S. ESQ.

Defendant Attorneys

BOOTH HILLARY ARROW

SITTLER RONALD KARL

SITTLER RONALD K.

 

Court Documents

ANSWER OF THIRD EYE CAPITAL AND STRATIVE CAPITAL

7/12/2018: ANSWER OF THIRD EYE CAPITAL AND STRATIVE CAPITAL

Declaration in Support of Ex Parte Application

7/24/2019: Declaration in Support of Ex Parte Application

Ex Parte Application - EX PARTE APPLICATION IN SUPPORT OF OSC RE CONTEMPT AGAINST PLAINTIFFS

7/24/2019: Ex Parte Application - EX PARTE APPLICATION IN SUPPORT OF OSC RE CONTEMPT AGAINST PLAINTIFFS

Minute Order - MINUTE ORDER (FINAL STATUS CONFERENCE)

8/27/2019: Minute Order - MINUTE ORDER (FINAL STATUS CONFERENCE)

STIPULATION TO SET ASIDE DEFAULTS' ORDER

6/27/2018: STIPULATION TO SET ASIDE DEFAULTS' ORDER

Notice of Case Reassignment and Order for Plaintiff to Give Notice

1/22/2019: Notice of Case Reassignment and Order for Plaintiff to Give Notice

Stipulation and Order - STIPULATION AND ORDER TO RESOLVE MOTION FOR PROTECTIVE ORDER AND OUTSTANDING DISCOVERY ISSUES

3/7/2019: Stipulation and Order - STIPULATION AND ORDER TO RESOLVE MOTION FOR PROTECTIVE ORDER AND OUTSTANDING DISCOVERY ISSUES

COMPLAINT FOR 1. BREACH OF WRITTEN CONTRACT; ETC

2/29/2016: COMPLAINT FOR 1. BREACH OF WRITTEN CONTRACT; ETC

NOTICE OF CASE MANAGEMENT CONFERENCE

3/2/2016: NOTICE OF CASE MANAGEMENT CONFERENCE

Minute Order -

8/2/2016: Minute Order -

NOTICE OF CASE MANAGEMENT CONFERENCE RULING (CMC)

10/24/2016: NOTICE OF CASE MANAGEMENT CONFERENCE RULING (CMC)

Minute Order -

11/17/2016: Minute Order -

PROOF OF SERVICE OF SUMMONS

3/2/2017: PROOF OF SERVICE OF SUMMONS

PROOF OF SERVICE OF SUMMONS

3/2/2017: PROOF OF SERVICE OF SUMMONS

REQUEST FOR ENTRY OF DEFAULT -

5/3/2017: REQUEST FOR ENTRY OF DEFAULT -

REQUEST FOR ENTRY OF DEFAULT -

10/2/2017: REQUEST FOR ENTRY OF DEFAULT -

REQUEST FOR ENTRY OF DEFAULT -

10/2/2017: REQUEST FOR ENTRY OF DEFAULT -

REQUEST FOR ENTRY OF DEFAULT -

10/2/2017: REQUEST FOR ENTRY OF DEFAULT -

48 More Documents Available

 

Docket Entries

  • 08/25/2020
  • Hearing08/25/2020 at 10:00 AM in Department 37 at 111 North Hill Street, Los Angeles, CA 90012; Non-Jury Trial

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  • 08/18/2020
  • Hearing08/18/2020 at 08:30 AM in Department 37 at 111 North Hill Street, Los Angeles, CA 90012; Final Status Conference

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  • 11/25/2019
  • Docketat 08:30 AM in Department 37; Trial Setting Conference - Held

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  • 11/25/2019
  • DocketMinute Order ( (Trial Setting Conference)); Filed by Clerk

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  • 09/12/2019
  • DocketNotice (of Final Status Ruling); Filed by Long Financial Services, Inc. (Plaintiff)

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  • 09/10/2019
  • Docketat 10:00 AM in Department 37; Non-Jury Trial - Not Held - Vacated by Court

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  • 08/27/2019
  • Docketat 08:30 AM in Department 37; Final Status Conference - Not Held - Vacated by Court

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  • 08/27/2019
  • DocketMinute Order ( (Final Status Conference)); Filed by Clerk

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  • 07/25/2019
  • Docketat 08:30 AM in Department 37; Hearing on Ex Parte Application (in Support of OSC Re Contempt Against Plaintiffs) - Held

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  • 07/25/2019
  • DocketMinute Order ( (Hearing on Ex Parte Application in Support of OSC Re Contempt...)); Filed by Clerk

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117 More Docket Entries
  • 09/02/2016
  • DocketPROOF OF SERVICE SUMMONS

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  • 09/02/2016
  • DocketProof-Service/Summons; Filed by Long Financial Services, Inc. (Plaintiff)

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  • 08/02/2016
  • Docketat 08:45 AM in Department 14; Case Management Conference (Conference-Case Management; Matter continued) -

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  • 08/02/2016
  • DocketMinute order entered: 2016-08-02 00:00:00; Filed by Clerk

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  • 08/02/2016
  • DocketMinute Order

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  • 03/02/2016
  • DocketNOTICE OF CASE MANAGEMENT CONFERENCE

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  • 03/02/2016
  • DocketNotice of Case Management Conference; Filed by Clerk

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  • 02/29/2016
  • DocketComplaint; Filed by Long Financial Services, Inc. (Plaintiff); Aslan Financial Group, Inc. (Plaintiff); Panthera Film Finance Company, Inc. (Plaintiff) et al.

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  • 02/29/2016
  • DocketCOMPLAINT FOR 1. BREACH OF WRITTEN CONTRACT; ETC

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  • 02/29/2016
  • DocketSUMMONS

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Tentative Rulings

Case Number: BC612041    Hearing Date: October 15, 2020    Dept: 37

HEARING DATE: October 15, 2020

CASE NUMBER: BC612041

CASE NAME: Long Financial Services, Inc., et al. v. Third Eye Capital Corporation, et al.

TRIAL DATE: November 17, 2020

PROOF OF SERVICE: OK

PROCEEDING: Defendants’ Motion for Judgment on the Pleadings

MOVING PARTIES: Defendants, Third Eye Capital Corporation and Strative Capital

RESPONDING PARTIES: Plaintiffs, Long Financial Services, Aslan Financial Group, Inc., Panthera Film Finance Company and Nell, Inc.

OPPOSITION: October 1, 2020

REPLY: October 9, 2020 [untimely]

TENTATIVE: Moving Defendants’ motion for judgment on the pleadings is DENIED. Plaintiffs are to give notice.

 

Background

This action arises out of a series of agreements to provide financing for a 2009 feature film entitled “Transylmania” (the “Picture”). Plaintiffs, Long Financial Services (“Long”) and Nell Inc. (“Nell”) allege that they are California corporations doing business in California. Panthera Film Finance Company, Inc. (“Panthera”) and Aslan Financial Group (“Aslan”) are also named plaintiffs, who allege that they are Nebraska corporations doing business in California.

Plaintiffs allege that in or around early 2009, Defendant Hill & Brand engaged Long and Nell to find financing for the Picture through a Finder’s Agreement. According to Plaintiffs, the Finder’s Agreement provided that Long and Nell would receive a finder’s fee equivalent to 5% of the gross amount of any financing they obtained, as well as a 4% profit participation and Executive Producer credit in Hill & Brand’s productions if a minimum of $2 million in capital was contributed by a source Long and Nell located.

Thereafter, according to Plaintiffs, Hill & Brand entered into a Confidentiality, Non-Circumvent and Non-Disclosure Agreement (“NCA”) on May 12, 2009 with all Plaintiffs. The NCA provided for all Plaintiffs to provide services to Hill & Brand, and allegedly prohibited Hill & Brand from circumventing Plaintiffs’ interests in certain instances. Further, Plaintiffs allege that Defendant Third Eye Capital Corporation (“Third Eye”) entered into a Confidentiality Agreement (“Third Eye NCA”) with all Plaintiffs on July 20, 2009, which allegedly protected Plaintiffs’ interests with respect to customers submitted to Third Eye.

Despite these above discussed agreements, Plaintiffs allege that they were not fully paid finder’s fees and other benefits after providing Defendants with sources for two loans over the course of 2009. Plaintiffs’ Complaint alleges the following causes of action: (1) breach of written contract against Hill & Brand, (2) breach of written contract against Third Eye, (3) fraud against Third Eye and Hill & Brand, (4) conspiracy to defraud against Third Eye and Hill & Brand, (5) negligent misrepresentation against Third Eye and Hill & Brand.

On October 2, 2017, default was entered against Hill & Brand. On July 12, 2018, Third Eye and Defendant Strative Capital (“Strative”) (together, “Moving Defendants”) answered the Complaint.

On July 22, 2020 Moving Defendants’ Motion for Terminating Sanctions, Motion for Undertaking and Motion for Summary Judgment came on for hearing. The court denied each of Defendants’ motion but granted Defendants’ request for monetary sanctions in the amount of $5,000 and ordered that the sanctions be paid within 60 days of the hearing date.

Moving Defendants now move for judgment on the pleadings as to the second through fourth causes of action in Plaintiffs’ Complaint. Plaintiffs oppose the motion. Plaintiff’s proof of service shows it was served by electronic or email service on September 22, 2010. It was filed September 23, 2010. Pursuant to Code of Civil Procedure section 1008, it should have been served and filed 16 court days before the hearing, which was September 22. Pursuant to Code of Civil Procedure section 1010.6(a)(4)(B) the period of notice for electronic service is extended by two court days, which made the deadline September 18, 2020. Since service was untimely, the court could refuse to hear the motion, but Plaintiffs have opposed making a decision now appropriate.

Discussion

  1. Meet and Confer Efforts

As of January 1, 2018, a party filing a MJOP must meet and confer in person or by telephone with the party who filed the pleading that is subject to the motion, identifying all of the specific allegations that it believes are subject to be stricken and, with legal support, the basis of the deficiencies.  (Code Civ. Proc., § 439, subd. (a)(1).)  “The parties shall meet and confer at least five days before the date a motion for judgment on the pleadings is filed.  If the parties are unable to meet and confer by that time, the moving party shall be granted an automatic 30-day extension of time within which to file a motion for judgment on the pleadings, by filing and serving, on or before the date a motion for judgment on the pleadings must be filed, a declaration stating under penalty of perjury that a good faith attempt to meet and confer was made and explaining the reasons why the parties could not meet and confer.”  (Code Civ. Proc., § 439, subd. (a)(2).)   

Moving Defendants’ motion includes no declaration or other showing that they have attempted to comply with Code of Civil Procedure, section 439’s meet and confer requirements. Additionally, Plaintiffs’ counsel Craig Missakian (“Missakian”) attests that Moving Defendants’ counsel did not meet and confer prior to filing the instant motion or otherwise meet and confer as ordered by the court on July 22, 2020. (Missakian Decl. ¶ 3.)

The court finds that Moving Defendants have failed to sufficiently demonstrate compliance with their statutory meet and confer obligations. However, that is not necessarily a sufficient ground for denying the motion

  1. Analysis

A defendant may move for judgment on the pleadings if the complaint does not state facts sufficient to constitute a cause of action against the defendant.  (Code Civ. Proc., § 438, subds. (b)(1) & (c)(1)(B)(ii).)  Except as provided by statute, the rules governing demurrers govern motions for judgment on the pleadings.  (Cloud v. Northrup Grumman Corp. (1998) 67 Cal.App.4th 995, 999.)  Therefore, the grounds for a motion for judgment on the pleadings must be apparent from either the face of the complaint or a matter of which the court may take judicial notice.  (Ibid.)  The court accepts the truth of all material facts properly pleaded, but not the truth of “contentions, deductions or conclusions of law.”  (Aubry v. Tri-City Hospital Dist. (1992) 2 Cal.4th 962, 967.) 

Pursuant to Code of Civil Procedure, section 438, subdivision (e), a motion for judgment on the pleadings may not be made “if a pretrial conference order has been entered pursuant to Section 575, or within 30 days of the date the action is initially set for trial, whichever is later, unless the court otherwise permits.”

As a preliminary note, Plaintiffs argue that Moving Defendants’ motion for judgment on the pleadings is untimely and should be denied on procedural grounds. Specifically, Plaintiffs argue that pursuant to Code of Civil Procedure section 438, a motion for judgment on the pleadings should have been made, if at all, within 30 days after the date this action was initially set for trial, which Plaintiffs argue has long since passed. (Opposition, 2-3.)

The court finds Plaintiffs’ argument unavailing. While the Case Management Order under Rule 3.728 is a pretrial conference order under Code of Civil Procedure section 575 and the initial trial date passed in 2017, a nonstatutory motion for judgment on the pleadings may be made any time before the commencement of trial. (See Stoops v. Abbassi (2002) 100 Cal.App.4th 644, 650; Smiley v. Citibank (South Dakota) N.A. (1995) 11 Cal.4th 138, 145 fn. 2.)

  1. Second Cause of Action: Breach of Contract

A cause of action for breach of contract consists of the following elements: (1) the existence of a contract; (2) the plaintiff’s performance or excuse for nonperformance; (3) the defendant’s breach; and (4) the resulting damages to the plaintiff.  (Oasis West Realty, LLC v. Goldman (2011) 51 Cal.4th 811, 821.) “The essence of a contract is the meeting of minds on the essential features of the agreement.” (Krasley v. Superior Court (1980) 101 Cal.App.3d 425, 431.) A contract “is unenforceable if the parties fail to agree on a material term or if a material term is not reasonably certain.” (Lindsay v. Lewandowski (2006) 139 Cal.App.4th 1618, 1623.) 

A written contract must be pled verbatim in the body of the complaint, be attached to the complaint and incorporated by reference, or be pled according to its legal effect.  (Bowden v. Robinson (1977) 67 Cal.App.3d 705, 718.)  An allegation of an oral agreement must “set[] forth the substance of its relative terms.”  (Gautier v. General Tel. Co. (1965) 234 Cal.App.2d 302, 305.)   

Moving Defendants contend that the motion must be granted as to the second cause of action for breach of contract because the Complaint fails to allege how Third Eye breached the NCA and, additionally, because the second cause of action is barred by the four year statute of limitations governing breach of contract causes of action. (Motion, 6-8.)

In opposition, Plaintiffs contend that all of Moving Defendants’ statute of limitations arguments must fail because the timeliness defect does not appear on the face of the Complaint. (Opposition, 3-8.) Additionally, Plaintiffs contend that the Complaint sufficiently alleges how Third Eye breached the NCA. (Opposition, 7-8.)

Here, the Complaint alleges that Plaintiffs and Third Eye were parties to the Third Eye NCA. (Complaint, ¶ 4, Exhibit C.) Further, the Third Eye NCA alleged “protected the Plaintiffs’ interests with regard to customers submitted to Third Eye for funding consideration.” (Complaint, ¶ 22.) Thereafter, Plaintiffs introduced Third Eye and Hill & Brand, and Third Eye and Hill & Brand entered into a Loan Agreement for funding of the Motion Picture. (Complaint ¶ 25.) Additionally, The Complaint alleges that Third Eye breached the NCA by using information Plaintiffs presented in order to extend Hill and Brand a new loan. (Complaint ¶¶ 39-41, 49, 74, 76, 78.)

The court finds that Plaintiffs’ first cause of action is sufficiently pled. Contrary to Moving Defendants’ contentions, the Complaint sufficiently alleges that Third Eye breached the NCA by wrongfully disclosing information Plaintiffs disclosed to them in order to facilitate a new loan with Hill and Brand. Additionally, the Complaint alleges in sufficient detail what kinds of promises Third Eye made and how much Plaintiffs believe is still due.

For these reasons, Plaintiffs’ motion is denied with respect to the second cause of action.

  1. Third Cause of Action: Fraud

The elements of a fraud cause of action are: (1) misrepresentation (false representation, concealment, or omission); (2) knowledge of falsity; (3) intent to induce reliance; (4) justifiable reliance; and (5) resulting damage. (Davis v. Southern California Edison Co. (2015) 236 Cal.App.4th 619.) Fraud must be pled in the complaint specifically. General and conclusory allegations are not sufficient. (Stansfield v. Starkey (1990) 220 Cal.App.3d 59, 74; Nagy v. Nagy (1989) 210 Cal.App.3d 1262, 1268.) Unlike most causes of action where the “the policy of liberal construction of the pleadings,” fraud requires particularity, that is, “pleading facts which show how, when, where, to whom, and by what means the representations were tendered.” (Stansfield, supra, 220 Cal.App.3d at 73; Lazar v. Superior Court (1996) 12 Cal.4th 631, 645.) Every element of a fraud cause of action must be alleged both factually and specifically. (Hall v. Department of Adoptions (1975) 47 Cal.App.3d 898, 904; Cooper v. Equity General Insurance (1990) 219 Cal.App.3d 1252, 1262.)

Moving Defendants contend that the remaining tort causes of action must fail because Plaintiffs have failed to allege any damages as a result of Moving Defendants’ alleged misconduct. (Motion, 10-12.) Specifically, Moving Defendants contend that “Plaintiffs have suffered no damages and, further, “Plaintiffs are likely to obtain judgment for the full amount of unpaid commissions” from other defendants that have been sued and defaulted in this case. (Motion, 11-12.)

In opposition, Plaintiffs contend that the fraud cause of action is sufficiently pled because it alleges both reliance and damages. (Opposition, 8-10.) Plaintiffs argue that the Complaint sufficiently alleges all elements of all of the tort cause of action, as follows:

In reply, Moving Defendants again assert that Plaintiffs’ cause of action must fail because the opposition states no damages. (Reply, 7.) However, Moving Defendants cite no authority for the proposition that Plaintiffs were required to specifically state a dollar amount for damages at this stage.

The court finds that Plaintiffs’ second cause of action is sufficiently pled. For these reasons, Moving Defendants’ motion is denied as to the second cause of action.

  1. Fourth Cause of Action: Conspiracy to Defraud

The elements of a civil conspiracy are the formation and operation of the conspiracy and damage resulting to plaintiff from an act done in furtherance of the common design.”  (Stueve Bros. Farms, LLC v. Berger Kahn (2013) 222 Cal.App.4th 303, 323 (Stueve Bros.), internal citations omitted.)   

“The major significance of a conspiracy cause of action lies in the fact that it renders each participant in the wrongful act responsible as a joint tortfeasor for all damages ensuing from the wrong … regardless of the degree of his activity.  The essence of the claim is that it is merely a mechanism for imposing vicarious liability; it is not itself a substantive basis for liability.  Each member of the conspiracy becomes liable for all acts done by others pursuant to the conspiracy, and for all damages caused thereby.”  (Stueve Bros., 222 Cal.App.4th at pp. 323-324, internal quotation marks and citations omitted.)   

Moving Defendants contend that the fourth cause of action is insufficiently pled for the same reasons as with the third cause of action. In opposition, Plaintiffs contend that the fourth cause of action is sufficient for the same reasons as the third cause of action.

Because the court finds that the third cause of action is sufficient, the court now finds that the fourth cause of action is sufficiently pled. Moving Defendants’ arguments are unavailing and do not demonstrate why Plaintiffs were required to plead damages beyond what the Complaint already alleges. For these reasons, Moving Defendants’ motion is denied with respect to the fourth cause of action.

  1. Fifth Cause of Action: Negligent Misrepresentation

A Plaintiff must prove the following in order to recover on a negligent misrepresentation claim: ‘[M]isrepresentation Rolapp Shamsian

Moving Defendants contend that the fifth cause of action must fail because the Complaint does not allege how Plaintiffs relied on Moving Defendants’ alleged misrepresentations. In opposition, Plaintiffs similarly contend that the Complaint sufficiently alleges reliance.

Here, the Complaint alleges that Plaintiffs were not allowed to receive copies of the loan documents between Hill and Brand and Third Eye and as a result, believed the total finder’s fees to be $425,000. (Complaint ¶¶ 26-27.) Plaintiffs further allege that they were never informed of the true amount of the loan agreements. (Complaint ¶ 41.) Plaintiffs allege that they relied on the Defendants’ false representations because it induced them to accept a lower payment than they were entitled to and to engage in further activities regarding funding of the Motion Picture, including introducing Third Eye and Hill and Brand. (Complaint ¶¶ 95-96.)

The court finds that Plaintiffs’ fifth cause of action is sufficiently alleged. Specifically, the Complaint alleges that Plaintiffs relied on Defendants’ misrepresentations by engaging in further activities regarding the funding of the Motion Picture, including attempting to broker additional agreements regarding funding of the Motion Picture. This is sufficient to state a cause of action for negligent misrepresentation.

For these reasons, Moving Defendants’ motion is denied with respect to the fifth cause of action.

Conclusion

Moving Defendants’ motion for judgment on the pleadings is DENIED. Plaintiffs are to give notice.

Case Number: BC612041    Hearing Date: July 22, 2020    Dept: 37

HEARING DATE: July 22, 2020

CASE NUMBER: BC612041

CASE NAME: Long Financial Services, Inc., et al. v. Third Eye Capital Corporation, et al.

TRIAL DATE: November 17, 2020

PROOF OF SERVICE: OK

PROCEEDING: Defendants’ Motion for Terminating Sanctions

MOVING PARTY: Defendants, Third Eye Capital Corporation and Strative Capital

RESPONDING PARTY: Plaintiffs, Long Financial Services, Aslan Financial Group, Inc., Panthera Film Finance Company and Nell, Inc.

OPPOSITION: April 6, 2020

REPLY: No reply filed as of July 20, 2020

TENTATIVE: Defendants’ request for terminating sanctions is DENIED. Defendants’ request for monetary sanctions is GRANTED in the amount of $3,150. Defendants are to give notice.

PROCEEDING: Defendants’ Motion for Undertaking

MOVING PARTY: Defendants, Third Eye Capital Corporation and Strative Capital

RESPONDING PARTY: Plaintiffs, Long Financial Services, Aslan Financial Group, Inc., Panthera Film Finance Company and Nell, Inc.

OPPOSITION: April 9, 2020

REPLY: July 15, 2020

TENTATIVE: Defendants’ motion is DENIED. Plaintiffs are to give notice.

PROCEEDING: Defendants’ Motion for Summary Judgment

MOVING PARTY: Defendants, Third Eye Capital Corporation and Strative Capital

RESPONDING PARTY: Plaintiffs, Long Financial Services, Aslan Financial Group, Inc., Panthera Film Finance Company and Nell, Inc.

OPPOSITION: July 8, 2020

REPLY: July 15, 2020

TENTATIVE: Defendants’ motion is DENIED. Plaintiffs are to give notice.

 

Background

This action arises out of a series of agreements to provide financing for a 2009 feature film entitled “Transylmania” (the “Picture”). Plaintiffs, Long Financial Services (“Long”) and Nell Inc. (“Nell”) allege that they are California corporations doing business in California. Panthera Film Finance Company, Inc. (“Panthera”) and Aslan Financial Group (“Aslan”) are also named plaintiffs, who allege that they are Nebraska corporations doing business in California.

Plaintiffs allege that in or around early 2009, Defendant Hill & Brand engaged Long and Nell to find financing for the Picture through a Finder’s Agreement. According to Plaintiffs, the Finder’s Agreement provided that Long and Nell would receive a finder’s fee equivalent to 5% of the gross amount of any financing they obtained, as well as a 4% profit participation and Executive Producer credit in Hill & Brand’s productions if a minimum of $2 million in capital was contributed by a source Long and Nell located.

Thereafter, according to Plaintiffs, Hill & Brand entered into a Confidentiality, Non-Circumvent and Non-Disclosure Agreement (“NCA”) on May 12, 2009 with all Plaintiffs. The NCA provided for all Plaintiffs to provide services to Hill & Brand, and allegedly prohibited Hill & Brand from circumventing Plaintiffs’ interests in certain instances. Further, Plaintiffs allege that Defendant Third Eye Capital Corporation (“Third Eye”) entered into a Confidentiality Agreement (“Third Eye NCA”) with all Plaintiffs on July 20, 2009, which allegedly protected Plaintiffs’ interests with respect to customers submitted to Third Eye.

Despite these above discussed agreements, Plaintiffs allege that they were not fully paid finder’s fees and other benefits after providing Defendants with sources for two loans over the course of 2009. Plaintiffs’ Complaint alleges the following causes of action: (1) breach of written contract against Hill & Brand, (2) breach of written contract against Third Eye, (3) fraud against Third Eye and Hill & Brand, (4) conspiracy to defraud against Third Eye and Hill & Brand, (5) negligent misrepresentation against Third Eye and Hill & Brand.

On October 2, 2017, default was entered against Hill & Brand. On July 12, 2018, Third Eye and Defendant Strative Capital (“Strative”) (together, “Moving Defendants”) answered the Complaint.

On December 12, 2018, Moving Defendants filed a motion for protective order, contending that Plaintiffs’ written discovery was intrusive, burdensome, and not reasonably calculated to lead to the discovery of admissible evidence.

On March 7, 2019, the parties filed a Stipulation and Proposed Order to Resolve Defendants’ Motion for Protective Order and other discovery issues. The Order, signed by the court on the same day, provided as follows:

  1. All Plaintiffs will provide written responses to Defendants’ requests for the production of documents (“TEC’s RFPs”) no later than March 11, 2019 without objection. The only appropriate objection will be for privilege and/or work product;

  2. All Plaintiffs will provide all documents responsive to TEC’s RFP no later than March 18, 2019;

  3. A representative for each Plaintiff will appear for their PMK deposition pursuant to prior notice no later than April 5, 2019. The parties will agree to the exact dates through counsel;

  4. Defendants TEC and Strative will produce to all Plaintiffs all documents that they intend to rely upon at trial and/or in their motion for summary judgment no later than March 21, 2019. Above.

The order also specifically provided that in the event one of the parties failed to meet any of the deadlines set forth, the opposing party was permitted to appear ex parte and request court intervention and sanctions. (see March 7, 2019 Stipulation) (hereinafter “March 7 Order”).

On July 24, 2019, Moving Defendants moved ex parte for an Order to Show Cause re Contempt, contending that Plaintiffs had failed to comply with the March 7 Order. The court denied the ex parte and ordered Moving Defendants to file a noticed motion for sanctions.

Moving Defendants filed the instant motion for terminating sanctions on March 25, 2020. Moving Defendants request in the alternative that the court award $6,300 in monetary sanctions against Plaintiffs. Plaintiffs oppose the motion.

Moving Defendants also move for an order requiring out of state Plaintiffs Panthera and Aslan to post a bond in the amount of $50,000 to cover attorney’s fees and costs Moving Defendants may be awarded in this action. Plaintiffs oppose the motion.

DEFENDANTS’ MOTION FOR TERMINATING SANCTIONS

Discussion

It is well established that the primary purpose of discovery sanctions is curative, not punitive. (Welgoss v. End (1967) 252 Cal.App.2d 982, 992; Caryl Richards, Inc. v. Superior Court (1961) 188 Cal.App.2d 300, 303-304.) Generally, the discovery statutes evince an incremental approach to sanctions, starting with monetary sanctions and ending with the ultimate sanction of dismissal. (Doppes v. Bentley Motors, Inc. (2009) 174 Cal.App.4th 967, 992.)

Moving Defendants contend that terminating sanctions are warranted because Plaintiffs have intentionally and egregiously disregarded the March 7 Order. (Motion, 7-9.) Moving Defendants cite to various cases in their motion for the proposition that repeated and/or egregious discovery abuses warrant terminating sanctions. (Motion, 7-9; see, eg., Reedy v. Bussell (2007) 148 Cal.App.4th 1272 [holding that repeated violations of rulings on discovery motions up to the time of trial warranted terminating sanctions].) Moving Defendants submit the declaration of their attorney, Ronald K. Sittler (“Sittler”) to demonstrate that Plaintiffs’ alleged disregard of the March 7, 2019 Order has been intentional and egregious.

Sittler attests that in July 2018, Moving Defendants served requests for production of documents and notices of deposition for a person most knowledgeable from each Plaintiff. (Sittler Decl. ¶ 7.) According to Sittler, Plaintiffs have failed to respond to the requests in writing and have served no objections to the deposition notices. (Id.) Further, according to Sittler, although Long and Nell have produced persons most knowledgeable for deposition, Aslan and Panthera have not appeared for deposition to date. (Sittler Decl. ¶¶ 13-14, Exhibits 4-5.) Further, Plaintiffs allegedly made a “production” of documents which allegedly did not include verifications (Sittler Decl. v 12.)

In opposition, Plaintiffs contend that they have acted in good faith and that terminating sanctions are not justified. (Opposition, 4-6.) Specifically, Plaintiffs contend that they have tried to comply with the March 7 Order and that terminating sanctions are thus excessive. (Motion, 5-6.) Further, Plaintiffs appear to argue that the instant motion is untimely pursuant to Code of Civil Procedure section 2030.300. (Opposition, 4.)

Plaintiffs also submit the declaration of their attorney, Eugene S. Fu (“Fu”) in support of their opposition. Fu attests that he has been working with defense counsel to schedule the person most knowledgeable depositions for each of the Plaintiffs and has informed defense counsel that one of the witnesses for these depositions lives in Nebraska. (Fu Decl. ¶¶ 6-7.) Fu attests that he informed defense counsel the witness was available by telephone or video, or in person if defense counsel would pay for the witness’ travel expenses. (Fu Decl. ¶¶ 8.) However, according to Fu, defense counsel did not respond to his communication regarding this Nebraska witness. (Id.)

First, Plaintiffs’ argument in reliance on Code of Civil Procedure section 2030.300 must fail. Code of Civil Procedure section 2030.300 provides that the party propounding interrogatories may move to compel a further response within 45 days of the date of service of those responses. However, here Moving Defendants seek terminating sanctions based on Plaintiffs’ alleged violation of the March 7 Order and do not seek an order compelling further responses to requests for production. As such, Code of Civil Procedure section 2030.300 does not apply.

Second, the court agrees with Plaintiffs that terminating sanctions are not warranted in this instance. Here, Moving Defendants seek terminating sanctions based on Plaintiffs’ alleged violation of the March 7 Order and contend that Plaintiffs have intentionally failed to comply with any portion of this order. However, as discussed above, Moving Defendants have admitted that Plaintiffs did produce two out of four persons most knowledgeable for deposition and have made a production of documents, albeit allegedly unorganized and unverified. Further, the Fu Declaration demonstrates that Plaintiffs’ counsel attempt to comply with the March 7 Order by offering to produce the remaining witnesses by telephone or video due to their status as out of state residents, but that defense counsel did not respond to this offer. An out of state witness is not required to attend deposition in California. (Toyota Motor Co. v. Superior Court (2011) 197 Cal.App.4th 1107.) As such, Plaintiffs have demonstrated that they have attempted to comply with the March 7 Order, and the court finds that terminating sanctions are not warranted.

Despite the foregoing, the court finds that an award of monetary sanctions is warranted. First, the March 7 Order itself clearly indicates that if either party fails to comply, the opposing party may seek an award of sanctions. Here, Plaintiffs contend that they have attempted to comply in good faith but have offered no explanation for why they did not provide written discovery responses as the order requires. Further, Plaintiffs have offered no explanation for why they made one production of documents without verification, and no further production of verified responses or documents. Accordingly, the court finds that $5,000 in monetary sanctions is justified.

Conclusion

Defendants’ request for terminating sanctions is DENIED. Defendants’ request for monetary sanctions is GRANTED in the amount of $5,000. Defendants are to provide notice.

DEFENDANTS’ MOTION FOR AN ORDER REQUIRING PLAINTIFF TO POST UNDERTAKING

Discussion 

  1. Legal Standard 

    Pursuant to Code of Civil Procedure, section 1030:

    (a) When the plaintiff in an action or special proceeding resides out of the state, or is a foreign corporation, the defendant may at any time apply to the court by noticed motion for an order requiring the plaintiff to file an undertaking to secure an award of costs and attorney’s fees which may be awarded in the action or special proceeding.  For the purposes of this section, “attorney’s fees” means reasonable attorney’s fees a party may be authorized to recover by a statute apart from this section or by contract.

    (b) The motion shall be made on the grounds that the plaintiff resides out of the state or is a foreign corporation and that there is a reasonable possibility that the moving defendant will obtain judgment in the action or special proceeding. The motion shall be accompanied by an affidavit in support of the grounds for the motion and by a memorandum of points and authorities. The affidavit shall set forth the nature and amount of the costs and attorney’s fees the defendant has incurred and expects to incur by the conclusion of the action or special proceeding.

    (Code Civ. Proc., § 1030, subds. (a)-(b).)  The party moving for an undertaking has the burden of proof of showing, by declaration, a reasonable possibility of prevailing in the action.  (Shannon v. Sims Serv. Ctr. (1985) 164 Cal.App.3d 907, 914 (Shannon).)

    “The determinations of the court under this section have no effect on the determination of any issues on the merits of the action or special proceeding and may not be given in evidence nor referred to in the trial of the action or proceeding.”  (Code Civ. Proc., § 1030, subd. (f).)  The purpose of the statute is to “prevent out-of-state residents from filing frivolous lawsuits against California residents.”  (Yao v. Superior Court (2002) 104 Cal.App.4th 327, 331.)  

    It is undisputed that Plaintiffs Panthera and Aslan are not residents of California. As such, the court will proceed to analyze Defendants’ probability of success on the merits.

  2. Probability of Success on the Merits

     

    Defendants contend that is has a reasonable probability of prevailing on the merits because Plaintiffs have allegedly made no effort to engage in discovery. (Motion, 8-9.) Defendants submit the declaration of Ronald Sittler (“Sittler”) in support of this contention. Defendants also appear to contend generally that they have a probability of success on the merits because they did not have a contractual relationship with any Plaintiff, and, as such, do not owe Plaintiffs on any of their claims. (Motion, 5-8.)

    First, Sittler attests that in March 2019, the court ordered all Plaintiffs to attend their deposition, provide responses to requests for production and produce documents. (Sittler Decl. ¶¶ 2, 5-6, Exhibit 1.) Sittler further attests that despite this order, only two of the four plaintiffs have appeared for deposition and all have failed to provide written responses or produce documents as ordered. (Id.) Specifically, Sittler attests that Plaintiffs Panthera and Aslan have failed to appear at their deposition and specifically refused to come to California. (Sittler Decl. ¶ 7.) Finally, Sittler attests that he has not received documents from Plaintiffs Long or Nell to date. (Sittler Decl. ¶¶ 8-9.) According to Sittler, the majority of Plaintiff’s claims “relate to the production of documents, attempts to take Plaintiffs’ deposition, plus two depositions that did not go forward and extensive motion practice.” (Sittler Decl. ¶ 10.)

    Second, Defendants submit the declaration of Arif Bhalwani (“Bhalwani”) in support of the contention that they did not have a contractual relationship with any Plaintiff. Bhalwani attests that he is the Managing Director of Third Eye and is also one of the custodians of records regarding the loan made to finance the Picture. (Bhalwani Decl. ¶¶ 1-2.) According to Bhalwani, Third Eye received information regarding Hill & Brand’s desire to finance the Picture in or about May 2009 and entered into the financing agreement on or about July 15, 2009. (Bhalwani Decl. ¶¶ 5-6.) Further, and according to Bhalwani, Defendants had not retained plaintiffs for any purpose relating to the loan agreement or otherwise at the time of closing on the loan agreement. (Bhalwani Decl. ¶ 7

    Plaintiffs submit the declaration of Edward Jarzobski (“Jarzobski”) in support of their opposition. Jarzobski is the President of all Plaintiff entities and attests that he introduced Third eye to the Picture. (Jarzobski Decl. ¶ 1.) Jarzobski attests that he was in direct contact with Third Eye related to many projects beginning in January 2009. (Jarzobski Decl. ¶¶ 2-3.) Jarzobski attests that during conversations and emails with Blair Carey of Third Eye, she acknowledged Third Eye’s relationship with Plaintiffs and the need for Plaintiffs to be paid for their work. (Jarzobski Decl. ¶ 4.) Further, Jarzobski attests that in 2009, Plaintiffs submitted “over 2 dozen projects” and received formal letters of interest from Third Eye, and that Bhalwani himself was on many of the emails, conference calls and other communications relating to these projects. (Jarzobski Decl. ¶¶ 17-19.)

    Given the foregoing, Defendants do not meet their burden to demonstrate a reasonable possibility of success on the merits. Defendants’ motion, taken as a whole, appears to contend through self-serving statements that the facts in this action are in defendants’ favor. However, questions of fact are for a fact-finder to determine, and Plaintiffs may still present evidence at trial to contradict Defendants’ contentions that it had no obligation to any Plaintiff.

    Accordingly, Defendants’ motion is denied.

    DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT

    Defendants move for summary judgment as to all claims by all Plaintiffs. On July 8, 2020, Plaintiffs filed an opposition contending that Defendants’ motion was untimely filed and served. The court has reviewed all parties moving and opposing papers, as well as Defendants’ reply papers. Because the court is inclined to deny Defendants’ motion on procedural grounds, the court will not discuss the substance of the motion in this ruling.

    Procedural History

    Plaintiffs’ counsel acknowledges that on or about May 10, 2020, Defendants served Plaintiffs’ counsel with a motion for summary judgment. The motion served did not attach a proof of service. This motion was not filed with the court at that time. (Declaration of Craig H. Missakian (“Missakian”), Exhibit A.) The proof of service for this motion indicates that on May 7, 2020, Eugene Fu, Esq. was served with the motion at 1458 San Pedro Street, #310, Los Angeles, California 90015 and 825 S. Ynez Avenue, Monterey Park, California 91754. (Id.) However, the proof of service further species that “delivery to the Monterey Park address was made on May 9, 2020.” The proof of service was signed by Defense counsel, Ronald Sittler, on May 21, 2020. (Id.)

    On June 16, 2020, Plaintiffs filed substitutions of attorney substituting in their current counsel, Craig Missakian and Edward E. Alon for prior counsel Eugene S. Fu. (“Eugene Fu.”)

    Defendants filed the instant motion for summary judgment on June 24, 2020. On July 8, 2020, Plaintiffs filed an opposition to Defendants motion, which generally contended that Defendants’ motion should be denied because Defendants’ motion was at a minimum untimely and, moreover, may contain serious discrepancies with the version Defendants served Plaintiffs counsel prior to the filing of Defendants’ motion.

    Defendants filed their reply on July 15, 2020, contending that their motion must be granted because Plaintiffs’ opposition has failed to address the merits of the motion.

    Discussion

  1. Legal Standard

“The purpose of the law of summary judgment is to provide courts with a mechanism to cut through the parties' pleadings in order to determine whether, despite their allegations, trial is in fact necessary to resolve their dispute.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843.) Pursuant to Code of Civil Procedure, section 437c, subdivision (a):

A party may move for summary judgment in any action or proceeding if it is contended that the action has no merit or that there is no defense to the action or proceeding. The motion may be made at any time after 60 days have elapsed since the general appearance in the action or proceeding of each party against whom the motion is directed or at any earlier time after the general appearance that the court, with or without notice and upon good cause shown, may direct…. The motion shall be heard no later than 30 days before the date of trial, unless the court for good cause orders otherwise. The filing of the motion shall not extend the time within which a party must otherwise file a responsive pleading.

(Code Civ. Proc., § 437c, subd. (a).)

  1. Analysis

     

A party moving for summary judgment shall give “notice of the motion and supporting papers” “at least 75 days before the time appointed for hearing.” (Code Civ. Proc. § 437c, subd. (a)(2).) This notice period may be extended five days if the motion is served by mail. (Id.) If a party moving for summary judgment fails to provide at least 75 days notice, a trial court may not cure the lack of notice by continuing the hearing on summary judgment. (Robinson v. Woods (2008) 168 Cal. App. 4th 1258, 1268 [holding that a trial court abused its discretion by continuing motion for summary judgment hearing to provide required 75 days notice.]) when the moving party provides less than the 75-days notice period, the trial court properly disregards the moving party’s motion as untimely. (Cuff v. Grossmont Union High School Dist. (2013) 221 Cal.App.4th 582, 596 [holding that a motion for summary judgment not filed within the 75-day period was untimely and properly disregarded by the trial court.])

Plaintiffs contend that Defendants’ motion must be denied for the following reasons: (1) Defendants’ served Plaintiff’s prior counsel with a motion for summary judgment on or about May 10, 2020, which would have provided 73 days notice and is thus untimely, (2) Defendants actually filed and served the instant motion on June 24, 2020, which would provide 23 days notice and is thus untimely, and (3) serious discrepancies exist between the contents of each motion.

Plaintiffs submit declarations from their prior attorney, Eugene Fu to demonstrate that Defendants May 2020 service was untimely. Eugene Fu attests that his business address is 825 S. Ynez Avenue, Monterey Park, California and also his residence. (Eugene Fu Decl. ¶ 3.) Eugene Fu attests that on May 10, 2020, Defendants motion was delivered to his residence and found by his mother, who showed him the package later that day. (Eugene Fu Decl. ¶ 4.) Further, Eugene Fu attests in his supplemental declaration that he also maintains an office at 1458 S. San Pedro Street, Unit 310, Los Angeles, California 90015 and that he was at the office on May 7, 8, 11 and 12. (Supplemental Eugene Fu Decl. ¶ 5.) According to Eugene Fu, he did not receive service of Defendants’ motion on any of those days at the San Pedro Street office. (Id.) Finally, and according to Fu, he has reviewed “MSJ Version #1” (the version he was served with) and “MSJ Version #2” (the version that was filed) and found the documents different in a number of ways. (Supplemental Eugene Fu Decl. ¶ 7, Exhibit 1.)

In reply, Defendants contend that Plaintiffs’ opposition must be disregarded because Plaintiffs never opposed the merits of Defendants’ motion. (Reply, 3-4.) Defendants also appear to argue that if Plaintiffs disputed whether the motion was timely served, Plaintiffs should therefore oppose the motion and request a continuance at the hearing. (Id.) However, Defendants have cited to no authority for its arguments regarding how Plaintiffs should have presented their objections to the motion’s timeliness. The remainder of Defendants reply largely consists of self-serving statements that Plaintiffs’ claims have no merit and should have been resolved many years prior.

The court believes that Plaintiffs have made a credible showing that they were not served within 75 days of the hearing. First, there is Yu’s declaration. Second, Defendants have filed inconsistent proofs of service. Lastly, Sittler’s Declaration in support of the reply memorandum states: “I caused Mr. Fu to be served on Friday May 8, 2020 at his office at 1458 S. San Pedro Street, Suite 310. As it was very late in the day, and I wanted to make sure service was made, I attempted to deliver the papers myself.” Such a statement does not satisfy the requirements for personal service. It does not say who the papers were delivered to or that delivery, which was admittedly “late in the day” was made during normal business hours.

Regardless, whether Defendants’ motion was timely filed and served in accordance with Code of Civil Procedure section 437c, subdivision (a)(2), the court has reviewed Defendants’ “MSJ Version #1” and agrees that there are a number of differences between this motion and the motion filed and served in June 2020. “The moving and supporting papers served shall be a copy of the papers filed or to be filed with the court. (Code Civ. Proc. § 1005, subd. (b).)

For these reasons, Defendants’ motion is DENIED.

Conclusion

Defendants’ untimely and non-conforming motion for summary judgment is DENIED. Plaintiffs are to give notice.

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