On 09/25/2017 CATHAY BANK filed an Other lawsuit against ACE HARDWARE CORPORATION. This case was filed in Los Angeles County Superior Courts, Pomona Courthouse South located in Los Angeles, California. The Judges overseeing this case are DUKES, ROBERT A. and PETER A. HERNANDEZ. The case status is Pending - Other Pending.
Pending - Other Pending
Los Angeles County Superior Courts
Pomona Courthouse South
Los Angeles, California
DUKES, ROBERT A.
PETER A. HERNANDEZ
ROBB EVANS & ASSOCCIATES LLC
ROBB EVANS & ASSOCIATES LLC.
ROBB EVANS & ASSOCCIATES LLC.
JOHN MIKULSKI INC
JMI MANUFACTURES REPRESENTATIVES
ACE HARDWARE CORPORATION
CHIU COOPER K.
CHIU ARBO K.
COOPER KUO PAO
CHIU KUO P.
YANG TIFFANY AKA TIFFANY WANG
JOHN MIKULSKI INC.
MIRMAN ALAN M.
ROBINS THOMAS M III
LAURIN PAUL L. ESQ.
LAURIN PAUL JOSEPH
MANDELL JOSHUA R. LAW OFFICES OF
MANDELL JOSHUA ROBERT
8/28/2019: Minute Order - MINUTE ORDER (HEARING ON DEFENDANT'S MOTION TO COMPEL FURTHER DISCOVERY RES...)
9/12/2019: Minute Order - MINUTE ORDER (RULING ON SUBMITTED MATTER;)
2/21/2018: Minute Order - Minute order entered: 2018-02-21 00:00:00
5/29/2018: Order - Order of tentative ruling
5/29/2018: Minute Order - Minute order entered: 2018-05-29 00:00:00
6/5/2018: Amended Complaint - Amended Amended Complaint
7/11/2018: Complaint -
10/10/2018: Minute Order - (Defendant, Ace Hardware Corporation's Demurrer to Second Amen...)
10/19/2018: Amended Complaint - Amended Amended Complaint
11/26/2019: Separate Statement
11/26/2019: Declaration - DECLARATION DECLARATION OF PAUL J. LAURIN ISO MSJ/MSA
12/11/2019: Declaration - DECLARATION DECLARATION OF BRICK KANE IN SUPPORT OF MOTION OF PLAINTIFFS FOR ORDER PERMITTING DISCOVERY OF FINANCIAL INFORMATION OF DEFENDANTS ACE ANDJMI
12/20/2019: Opposition - OPPOSITION TO PLAINTIFF'S MOTION FOR ORDER PERMITTING DISCOVERY OF FINANCIAL INFORMATION
1/3/2020: Stipulation and Order - STIPULATION AND ORDER TO CONTINUE TRIAL DATE
9/28/2017: Legacy Document - LEGACY DOCUMENT TYPE: Notice
2/1/2018: Other - - Other - Specially Appearing Defendant, John Mikulski, Inc.'s Appendix of Out-of-State Authorities
5/14/2018: Declaration - Declaration of John Mikulski in Support of Specially Appearing Defendant John Mikulski, Inc. Motion to Quash or, in the Alternative Dismiss
6/26/2018: Declaration - Declaration of Bruce Meredith in Support of the Application by Cathay Bank for Issuance of a Right to Attach Order Against Ace Hardware Corporation
Hearing09/08/2020 at 08:30 AM in Department O at 400 Civic Center Plaza, Pomona, CA 91766; Jury TrialRead MoreRead Less
Hearing08/31/2020 at 08:30 AM in Department O at 400 Civic Center Plaza, Pomona, CA 91766; Final Status ConferenceRead MoreRead Less
Hearing03/16/2020 at 08:30 AM in Department O at 400 Civic Center Plaza, Pomona, CA 91766; Hearing on Motion - Other Discovery of Financial Information re PunitivesRead MoreRead Less
Hearing03/16/2020 at 08:30 AM in Department O at 400 Civic Center Plaza, Pomona, CA 91766; Hearing on Motion for Summary JudgmentRead MoreRead Less
Docketat 08:30 AM in Department O, Peter A. Hernandez, Presiding; Hearing on Motion - Other (Discovery of Financial Information re Punitives) - Not Held - Continued - StipulationRead MoreRead Less
DocketStipulation and Order (STIPULATION TO CONTINUE PLAINTIFFS' MOTION FOR ORDER PERMITTING DISCOVERY OF FINANCIAL INFORMATION AS TO DEFENDANTS ACE HARDWARE CORPORATION AND JOHN MIKULSKI, INC. TO SUPPORT CLAIM FOR PUNITIVE DAMAGES [Civ. Code 3295(c)]; [PROPOSED] ORDER THEREON); Filed by CATHAY BANK (Plaintiff)Read MoreRead Less
DocketStipulation and Order (To Continue Trial Date); Filed by ACE HARDWARE CORPORATION (Defendant)Read MoreRead Less
DocketDeclaration (OF JOSHUA R. MANDELL IN SUPPORT OF DEFENDANT JMI, INC.'S OPPOSITION TO PLAINTIFF'S MOTION FOR ORDER PERMITTING DISCOVERY OF FINANCIAL INFORMATION); Filed by JOHN MIKULSKI, INC. (Defendant)Read MoreRead Less
DocketRequest for Judicial Notice; Filed by JOHN MIKULSKI, INC. (Defendant)Read MoreRead Less
DocketOpposition (TO PLAINTIFF'S MOTION FOR ORDER PERMITTING DISCOVERY OF FINANCIAL INFORMATION); Filed by JOHN MIKULSKI, INC. (Defendant)Read MoreRead Less
DocketNotice ( of errata re verified complaint ); Filed by Attorney for PlaintiffRead MoreRead Less
DocketNotice; Filed by CATHAY BANK (Plaintiff)Read MoreRead Less
DocketNotice of Case Management Conference; Filed by ClerkRead MoreRead Less
DocketNotice-Case Management Conference; Filed by ClerkRead MoreRead Less
DocketComplaint FiledRead MoreRead Less
DocketCivil Case Cover Sheet; Filed by CATHAY BANK (Plaintiff); ROBB EVANS & ASSOCIATES, LLC. (Plaintiff)Read MoreRead Less
DocketSummons (on Amended Complaint (3rd)); Filed by ClerkRead MoreRead Less
DocketNotice-Related Cases; Filed by PlaintiffRead MoreRead Less
DocketComplaint; Filed by CATHAY BANK (Plaintiff); ROBB EVANS & ASSOCCIATES LLC., (Plaintiff)Read MoreRead Less
DocketNotice of Related Case; Filed by PlaintiffRead MoreRead Less
Case Number: KC069647 Hearing Date: May 11, 2020 Dept: O
Plaintiffs Cathay Bank and Robb Evans & Associates LLC’s motion for order permitting discovery of financial information as to Defendants Ace Hardware Corporation and John Mikulski, Inc. is DENIED.
Judicial notice is taken of Defendant JMI, Inc.’s (“Defendant JMI”) Exhibits 1-2. (Evid. Code § 452.)
Defendant Ace Hardware Corporation’s (“Defendant Ace”) evidentiary objections are OVERRULED as to Objections ## 2, 7-10, 13, 16-18, 22-23, 25-27, 29, 31, and 33 and SUSTAINED as to Objections ## 1, 3-6, 11-12, 14-15, 19-21, 24, 28, 30, 32, and 34.
Plaintiffs Cathay Bank and Robb Evans & Associates LLC (collectively, the “Plaintiffs”) move for leave to conduct discovery into the financial condition of Defendant Ace and Defendant JMI (collectively, the “Defendants”) pursuant to Civil Code section 3295(c):
No pretrial discovery by the plaintiff shall be permitted with respect to the evidence referred to in paragraphs (1) and (2) of subdivision (a) unless the court enters an order permitting such discovery pursuant to this subdivision. However, the plaintiff may subpoena documents or witnesses to be available at the trial for the purpose of establishing the profits or financial condition referred to in subdivision (a), and the defendant may be required to identify documents in the defendant’s possession which are relevant and admissible for that purpose and the witnesses employed by or related to the defendant who would be most competent to testify to those facts. Upon motion by the plaintiff supported by appropriate affidavits and after a hearing, if the court deems a hearing to be necessary, the court may at any time enter an order permitting the discovery otherwise prohibited by this subdivision if the court finds, on the basis of the supporting and opposing affidavits presented, that the plaintiff has established that there is a substantial probability that the plaintiff will prevail on the claim pursuant to Section 3294. Such order shall not be considered to be a determination on the merits of the claim or any defense thereto and shall not be given in evidence or referred to at the trial.
(CC § 3295(c).)
“[B]efore a trial court may enter an order allowing discovery of financial condition information under Civil Code section 3295, subdivision (c), it must (1) weigh the evidence presented by both sides, and (2) make a finding that it is very likely the plaintiff will prevail on his claim for punitive damages.” (Jabro v. Superior Court (2002) 95 Cal. App. 4th 754, 755.)
The Third Amended Complaint (“TAC”) alleges that Defendant JMI facilitated a scheme to launder money owed to Plaintiffs by now-defunct company Sentron International, Inc. (“Sentron”). Defendant JMI contacted Defendant Ace to rename purchase orders made by Sentron to Smith Barnett, LLC (“Smith Barnett”). Plaintiffs allege that Defendant Ace knew of this conversion scheme and willfully complied with Defendant JMI’s request to rename the purchase orders.
Plaintiffs submit the following evidence:
Plaintiffs, through Cathay Bank (“Bank”), had a perfected security interest in Sentron’s Inventory, contract rights, accounts receivables, and proceeds enforceable against Sentron and third parties. (See Declaration of Gregory Badura ¶¶ 3-13.) When Sentron defaulted on the loans, it began hiding its assets by transferring its business to Smith Barnett. (See Declaration of Bruce Meredith Decl., ¶ 9.) One component of this alleged plan was to get Defendant Ace to change the name on the Sentron purchase order to Smith Barnett. Three days after the Bank filed suit sometime in early October 2015, Sentron contacted JMI to request Defendant Ace to change their legal name and business to Smith Barnett. (Id. at ¶¶ 10-11.) At around that time, a receiver was appointed and Plaintiff Robb Evans & Associates, LLC (“Robb Evans”) notified Defendant Ace via telephone of its appointment on November 4, 2015. (See Declaration of Jackie Dadbin (“Dadbin Decl.”) ¶ 2-4.) Plaintiff Robb Evans then sent a letter to Defendant Ace on November 18, 2015 about the same issue. (Id. at ¶ 10.) This letter was forward a few times before reaching William Christou, who was a counsel in Defendant Ace’s legal department. (See Declaration of Thomas Robins ¶ 4, Ex. 71.) On November 24, 2015, Mr. Christou called Plaintiff Robb Evans through Jackie Dadbin and asked for a week to review the matter. (Dadbin Decl., ¶¶ 14-16.) In that time period, Defendant Ace paid Smith Barnett its invoices for the racking material in an amount over $585,000.00. (See Declaration of Bruce Poltrock ¶ 6.) Mr. Christou spoke with Ms. Dadbin again on December 3, where he told her that Defendant Ace’s account had been changed to Smith Barnett but failed to mention that Defendant Ace was making payments to Smith Barnett. (Dadbin Decl., ¶¶ 17-20.)
In opposition, Defendant Ace offers the declaration of Paul Laurin, who attended the depositions of Mr. Christou, Mr. Meredith, Wayne Janovsky, Jason Sieben and Susan Kintz in connection with this litigation. In the declaration, Mr. Laurin provides deposition transcripts from these witnesses, who testified to facts showing they were unaware of the scheme. Mr. Christou testified that he did not receive the email sent from Brian Wojciechowski to Mr. Janovsky regarding the four invoices until after December 15, 2015. (See Declaration of Paul Laurin ¶ 2, Ex. A.) Furthermore, Mr. Christou testified that he investigated the delivery of Ms. Dadbin’s email to Defendant Ace regarding the receivership and found that Ms. Dadbin had sent her letter to the human resources manager at Defendant Ace’s retail support center in Sacramento, CA (i.e., Margo Miles) rather than to Defendant Ace’s legal department. (Ibid.) Mr. Meredith testified that he was not contacted by the receiver until the beginning of 2016 (Id. at ¶ 3, Ex. B), and Mr. Janovsky testified that he was mainly concerned with whether Defendant Ace was going to get the racks for its promotion and was merely thinking of things from the perspective of a merchant and not from a legal perspective. (Id. at ¶ 4, Ex. C.) Mr. Janovsky also testified that he was not aware that the request by Defendant JMI for the name change could have affected the receivership. (Ibid.)
Based on the conflicting evidence, the Court finds that Plaintiffs failed to carry their high burden of establishing “substantial probability” or “that it is very likely” that they will prevail on their claims for punitive damages against Defendant Ace. There is no evidence that Defendant Ace was a willful participant in the alleged scheme to defund Sentron. Plaintiffs ask the Court to speculate that Defendant Ace must have complied with Defendant JMI’s request for name change solely to convert assets. However, it is equally possible that there was a miscommunication between the various departments at Defendant Ace that caused Defendant Ace to not know what the other parties were planning, and thus caused Defendant Ace to delay the taking appropriate action after the receivership went into effect. At most, this shows an act of negligence on the part of Defendant Ace, but nothing so willful to entitle Plaintiffs to punitive damages discovery against Defendant Ace.
The same can also be said of Defendant JMI. While the Court is troubled by the November 21, 2015 email from Defendant JMI to Defendant Ace, it finds that Plaintiffs have not met their burden with respect to Defendant JMI. The October 12, 2015 email that discusses Defendant JMI’s request to Defendant Ace to change the billing name from Sentron to Smith Barnett may indicate some intent to deceive Plaintiff Robb Evans, but it is far from establishing “substantial probability” given the factual dispute raised by Defendant JMI that there was indication the name change was under review by Sentron and Defendant Ace prior to the filing of the Bank’s lawsuit. Moreover, the November 21, 2015 email could also be construed as reminding Defendant Ace not to disclose Smith Barnett’s private information from disclosure. If Sentron never had possessory interest in the goods based on nature of the sale, which is in dispute in this lawsuit, then any new purchase orders by Smith Barnett to Jiangmen Victory, the manufacture in China, would presumably be private information they would want to maintain private. Again, at this point, this does not show a willful act by Defendant JMI to entitle Plaintiffs to punitive damages discovery against it.
Accordingly, the motion is DENIED.