On 03/05/2018 JORJIK NAZARIYAN filed a Contract - Other Contract lawsuit against ARMOND ROSTAMI. This case was filed in Los Angeles County Superior Courts, Burbank Courthouse located in Los Angeles, California. The Judges overseeing this case are DAVID SOTELO, LAURA A. MATZ and CURTIS A. KIN. The case status is Pending - Other Pending.
Pending - Other Pending
Los Angeles County Superior Courts
Los Angeles, California
LAURA A. MATZ
CURTIS A. KIN
NAZARIYAN JORJIK AN INDIVIDUAL
ROSTAMI ANAHID AN INDIVIDUAL
NUMBER 1 ELECTRIC INC.
ROSTAMI ARMOND AN INDIVIDUAL
THEODORA ORINGHER PC
STEVEN E YOUNG
STEVEN E. YOUNG ESQ.
YOUNG STEVEN EARL
EL-HADDAD NESREIN M.
SARAH R. WOLK
WOLK SARAH ROSE
1/4/2021: Notice - NOTICE DEFENDANT-ARMOND ROSTAMI'S NOTICE RE: JUDGMENT OF DISMISSAL OF THE ENTIRE COMPLAINT WITH PREJUDICE
12/30/2020: Notice of Entry of Judgment / Dismissal / Other Order
11/13/2020: Certificate of Mailing for - CERTIFICATE OF MAILING FOR (HEARING ON MOTION TO QUASH MOTIONS TO QUASH THE SUBPOENAS FOR...) OF 11/13/2020
9/30/2020: Proof of Service (not Summons and Complaint)
6/24/2020: Case Management Statement
2/11/2020: Notice - NOTICE NOTICE OF CONTINUED CASE MANAGEMENT CONFERENCE
12/10/2019: Notice - NOTICE OF CONTINUED STATUS CONFERENCE AND ORDER TO SHOW CAUSE
12/10/2019: Minute Order - MINUTE ORDER (ORDER TO SHOW CAUSE RE: WHY MONETARY SANCTIONS IN THE AMOUNT ...)
8/12/2019: Notice - NOTICE OF WITHDRAWAL OF ASSOCIATION OF COUNSEL
3/26/2018: Legacy Document - LEGACY DOCUMENT TYPE: PROOF-SERVICE/SUMMONS
7/24/2018: Separate Statement
8/31/2018: Legacy Document - LEGACY DOCUMENT TYPE: OPPOSITION
8/31/2018: Legacy Document - LEGACY DOCUMENT TYPE: OPPOSITION
8/31/2018: Legacy Document - LEGACY DOCUMENT TYPE: OPPOSITION
12/14/2018: Substitution of Attorney
8/31/2018: Opposition -
9/7/2018: Reply -
Docketat 1:30 PM in Department E, Curtis A. Kin, Presiding; Non-Appearance Case Review (reJudgment) - Not Held - Vacated by CourtRead MoreRead Less
DocketMemorandum of Costs (Summary); Filed by Armond Rostami (Defendant)Read MoreRead Less
DocketNotice (DEFENDANT-ARMOND ROSTAMI'S NOTICE RE: JUDGMENT OF DISMISSAL OF THE ENTIRE COMPLAINT WITH PREJUDICE); Filed by Armond Rostami (Defendant)Read MoreRead Less
DocketJudgment (of Dismissal of the Entire Complaint with Prejudice); Filed by Armond Rostami (Defendant)Read MoreRead Less
DocketNotice of Entry of Judgment / Dismissal / Other Order; Filed by ClerkRead MoreRead Less
Docketat 2:00 PM in Department E, Curtis A. Kin, Presiding; Hearing on Motion for Summary Judgment - HeldRead MoreRead Less
DocketNotice (DEFENDANT-ARMOND ROSTAMI'S NOTICE RE: Court's Order of 12.11.2020 on Defendant's MSJ/MSSA); Filed by Armond Rostami (Defendant)Read MoreRead Less
DocketMinute Order ( (Hearing on Motion for Summary Judgment)); Filed by ClerkRead MoreRead Less
DocketReply (Plaintiffs? Sur-Reply To Defendant?s Reply To Plaintiffs? Additional Material Facts Precluding Summary Judgment); Filed by JORJIK, NAZARIYAN (Plaintiff); ANAHID, ROSTAMI (Plaintiff); NUMBER 1 ELECTRIC, INC. (Plaintiff)Read MoreRead Less
DocketObjection (Plaintiffs? Evidentiary Objections To And Motion To Strike The Declaration Of Henrik Mosesi); Filed by JORJIK, NAZARIYAN (Plaintiff); ANAHID, ROSTAMI (Plaintiff); NUMBER 1 ELECTRIC, INC. (Plaintiff)Read MoreRead Less
DocketJury Fee Deposit by Defendant; Filed by Armond Rostami (Defendant)Read MoreRead Less
DocketAnswer; Filed by Armond Rostami (Defendant)Read MoreRead Less
DocketSummons FiledRead MoreRead Less
DocketCivil Case Cover SheetRead MoreRead Less
DocketComplaint filed-Summons Issued; Filed by nullRead MoreRead Less
DocketSummons; Filed by nullRead MoreRead Less
DocketNotice (of OSC)Read MoreRead Less
DocketNotice of Case Management ConferenceRead MoreRead Less
DocketNotice of Case Assignment - Unlimited Civil CaseRead MoreRead Less
DocketComplaint filed-Summons IssuedRead MoreRead Less
Case Number: EC067759 Hearing Date: December 11, 2020 Dept: E
MOTION FOR SUMMARY JUDGMENT, OR ALTERNATIVELY, SUMMARY ADJUDICATION
[CCP § 437c; CRC 3.1350 et seq.]
Date: 12/11/20 (2:00 PM)
Case: Jorjik Nazariyan et al. v. Armond Rostami (EC067759)
Defendant Armond Rostami’s Motion for Summary Judgment, or Alternatively, Summary Adjudication is GRANTED.
Defendant Armond Rostami moves for summary judgment, or alternatively, summary adjudication on four grounds: (1) the complaint is a sham pleading; (2) the oral contract sought to be enforced is unenforceable due to its illegality; (3) the statute of limitations on the oral contract has expired; and (4) all other causes of action beside the first cause of action for breach of oral contract arise from breach of a void and illegal oral contract.
As a preliminary matter, the Court disregards plaintiffs’ papers filed on December 7, 2020 in support of a purported sur-reply, as such documents are not authorized by CCP § 437c.
A. Evidentiary Matters
Pursuant to Evidence Code § 452(b), defendant’s requests for judicial notice as to Exhibits 1 through 5, which are copies of federal legislation, executive orders, and regulations, are GRANTED. Plaintiffs’ evidentiary objections to defendant’s request for judicial notice as to Exhibits 1 through 5 are OVERRULED.
Pursuant to Evidence Code § 452(c), defendant’s request for judicial notice as to Exhibit 10 is GRANTED, but only for the existence of the Cautionary Letter from the United States Department of Treasury, not the truth of the matters asserted therein. (Arce v. Kaiser Foundation Health Plan, Inc. (2010) 181 Cal.App.4th 471, 482.) Plaintiffs’ evidentiary objection to defendant’s request for judicial notice as to Exhibit 10 is OVERRULED.
Defendant’s request for judicial notice as to Exhibit 11(Court Judgment of Tehran) is DENIED because no provision of Evidence Code §§ 451 or 452 allows the Court to take judicial notice of a judgment of a foreign country. Plaintiffs’ evidentiary objection to defendant’s request for judicial notice as to Exhibit 11 is OVERRULED.
Plaintiffs’ request for judicial notice of the Findings of Fact and Conclusions of Law and Order in the adversary proceeding in bankruptcy case Nazariyan et al. v. Rostami, Adv. No. 2:19-ap-01035-BR, is GRANTED, pursuant to Evidence Code § 452(d).
Plaintiffs’ objections in their responding separate statement are improper. The California Rules of Court do not provide for objections to be asserted within the separate statement. (Cal. Rule of Court 3.1350(h).) “All written objections to evidence must be served and filed separately from the other papers in support of or in opposition to the motion.” (Cal. Rule of Court 3.1354(b).)
Defendant’s evidentiary objections are OVERRULED.
B. Issue No. 1: This Complaint is a sham pleading.
Defendant contends that the Complaint in this action is a sham pleading based on the complaint plaintiff previously filed in Jorjik Nazariyan et al. v. Armond Rostami, LASC Case No. BC671662 (“Prior Complaint”). (UMF 9, 10; Def. RJN Ex. 6.) Defendant argues that, in the operative Complaint in this action, plaintiffs deleted the allegation that the ultimate destination for the parts and equipment was Iran and that plaintiff Nazariyan discovered the alleged breach of oral contract in 2015, which would render some portion of this action time-barred.
In the Prior Complaint, plaintiffs Jorjik Nazariyan and Number 1 Electric, Inc. (“Number 1”) alleged that, from 2011 to 2016, pursuant to an oral contract, Nazariyan paid for and shipped commercial air conditioning system parts and equipment to defendant in Tehran, Iran. (UMF 12; Def. RJN Ex. 6, BC-1, BC-2, FR-2(a).) Defendant then allegedly sold the parts and equipment at a markup, after which Nazariyan and defendant were to share the profits. (UMF 12; Def. RJN Ex. 6, BC-2, FR-2(a).) Defendant allegedly paid only $100,000 to Nazariyan for $500,000 in equipment, claiming that he was unable to sell the rest. (Def. RJN Ex. 6, BC-2, FR-2(b).) However, defendant allegedly sold more than he claimed and kept Nazariyan’s share of the profits. (Def. RJN Ex. 6, BC-2, FR-2(b).)
In a declaration supporting the Prior Complaint, Nazariyan averred that, in 2015, his friends, family members, and defendant’s business associates alerted him that more inventory stock was being sold than what had been reported to him. (UMF 8, 13; Def. RJN Ex. 7 at ¶ 12.) Nazariyan also averred that he was alarmed by defendant’s failure to remit money due to him. (Def. RJN Ex. 7 at ¶ 12.) Nazariyan thus flew to Iran and discovered that a small fraction of inventory he shipped to defendant remained, meaning that defendant had sold more inventory than defendant claimed. (Def. RJN Ex. 7, ¶ 12.)
This Prior Complaint was dismissed without prejudice on October 23, 2017, pursuant to plaintiffs Nazariyan and Number 1’s request for dismissal. (UMF 14; Def. RJN Ex. 8.)
In the Complaint filed in this action, plaintiffs Nazariyan and Number 1 added Nazariyan’s wife, Anahid Rostami, as a plaintiff. (UMF 15, 19.) Defendant contends that plaintiffs removed the allegation that the air conditioning parts and equipment were shipped to Tehran, Iran. (UMF 16.) Instead, plaintiffs allege that Nazariyan shipped the parts and equipment to Dubai in the United Arab Emirates without stating where they went afterward. (UMF 17; Compl. ¶¶ 13, 15.) Plaintiffs also allege that they discovered defendant’s withholding of plaintiffs’ share of the profits in 2017, not 2015, when plaintiffs’ purported investigation into defendant’s financial situation revealed that defendant sold essentially all the inventory plaintiffs shipped to him in Dubai. (UMF 20; Compl. ¶ 17.)
“‘[U]nder the sham pleading doctrine, plaintiffs are precluded from amending complaints to omit harmful allegations, without explanation, from previous complaints to avoid attacks raised in demurrers or motions for summary judgment. [Citations omitted].’” (State ex rel. Metz v. CCC Info. Servs., Inc.) (2007) 149 Cal. App. 4th 402, 412. “This exception applies not only to an amended pleading filed in the same action, but also to the first pleading filed in a separate action . . . .” (Larson v. UHS of Rancho Springs, Inc. (2014) 230 Cal.App.4th 336, 344.)
The Complaint here is based on the same agreement alleged in the Prior Complaint. Further, in the declaration in support of the Prior Complaint, Nazariyan averred that, under the terms of his oral contract with defendant, Nazariyan shipped air conditioning parts and equipment from the United States to the United Arab Emirates and then to defendant in Tehran, Iran. (Def. RJN Ex. 6 at ¶ 8.) Nazariyan also averred that defendant conducted business “in Iran.” (Def. RJN Ex. 6 at ¶ 9.) The court file in the prior action reflects that plaintiffs Nazariyan and Number 1 dismissed the action after defendant demurred based on the purported illegality of the underlying oral contract. Accordingly, plaintiffs appear to have deleted the allegation that they shipped the parts and equipment to Iran to avoid any attacks on the pleadings based on the purported illegality of the oral contract. Plaintiffs argue in the opposition that, in the Complaint, they “sought to clarify and elaborate on ambiguities contained in the Prior Complaint and corresponding declaration.” (Opp. at 12.) This explanation strains credulity, as there was nothing ambiguous about the allegation in the Prior Complaint that plaintiffs shipped the parts and equipment to defendant in Iran. The Court therefore considers the allegations of the Prior Complaint and Nazariyan’s prior declaration when evaluating whether the oral contract alleged in the instant Complaint is illegal such that defendant should be entitled to summary judgment or summary adjudication.
With respect to the argument that plaintiffs changed the Prior Complaint’s allegation that they discovered defendant’s alleged breach in 2015 to an allegation in the present Complaint that discovery was not made until 2017, the Court notes that defendant did not previously demur based on the expiration of the statute of limitations. However, “the plaintiff may not plead facts that contradict the facts or positions that the plaintiff pleaded in earlier actions or suppress facts that prove the pleaded facts false . . . . When the plaintiff pleads inconsistently in separate actions, the plaintiff's complaint is nothing more than a sham that seeks to avoid the effect of a demurrer.” (Cantu v. Resolution Trust Corp. (1992) 4 Cal.App.4th 857, 877–78, emphasis omitted.) Because this action was filed on March 5, 2018 and the statute of limitations for an action based on oral contract is two years, as discussed further below, any assertion that plaintiffs discovered defendant’s breach in 2015 would have subjected the Complaint to an attack on demurrer. Accordingly, when evaluating defendant’s claim that summary judgment or adjudication should be granted on the basis of the applicable statute of limitations having run, the Court will consider the Prior Complaint’s allegation that plaintiff discovered defendant’s breach in 2015.
C. Issue No. 2: The oral contract sought to be enforced is illegal and unenforceable.
Defendant argues that the oral contract forming the basis of this action is unlawful and therefore unenforceable.
“If any part of a single consideration for one or more objects, or of several considerations for a single object, is unlawful, the entire contract is void.” (Civ. Code § 1608.) A contract is “unlawful” if it is in conflict either with express statutes or public policy. (Vierra v. Workers’ Comp. Appeals Bd., (2007) 154 Cal.App.4th 1142, 1148.)
As plaintiffs alleges in the Complaint, at all relevant times, they were residents of Glendale, California, or in the case of plaintiff Number 1 Electric, Inc., operated its principal place of business in Glendale, California. (Compl. ¶¶ 1-3.) Accordingly, plaintiffs are “United States persons” under the Iranian Transactions and Sanctions Regulations (“ITSR”). (31 C.F.R. § 560.314 [“The term United States person or U.S. person means any United States citizen, permanent resident alien, entity organized under the laws of the United States or any jurisdiction within the United States (including foreign branches), or any person in the United States”].) In this action, plaintiffs allege that they shipped air conditioning parts and equipment to defendant in Dubai, United Arab Emirates. (Compl. ¶ 13.) In the Prior Complaint and Nazariyan’s accompanying declaration, however, plaintiffs Nazariyan and Number 1 alleged that they exported goods to defendant in Iran. (UMF 12; Def. RJN Ex. 6, BC-1, BC-2, FR-2(a); RJN Ex 7 at ¶¶ 8-9,12-13.) Based on these prior admissions and allegations, even if the parts and equipment were shipped to a some other country beforehand, the Court finds that plaintiffs cannot dispute the ultimate destination of the parts and equipment was Iran. Accordingly, under the ITSR, the alleged oral contract was unlawful and accordingly void. (31 C.F.R. § 560.204(a) [prohibiting shipment of goods to Iran “directly or indirectly”].)
Further, in response to correspondence from plaintiffs, the Office of Foreign Assets Control (“OFAC”) of the U.S. Department of the Treasury in a “Cautionary Letter” opined, “Accordingly, [Number 1]'s exports of used compressor, refrigerator, and air conditioner parts to the United Arab Emirates, with knowledge or reason to know that such exports were ultimately destined for Iran, appears to have violated the ITSR.” (UMF 23, 27, 30; Yarian Decl. ¶¶ 16, 17 & Ex. 5.) As stated in the “Evidentiary Matters” section above, the Court does not take judicial notice of the truth of this letter, particularly considering that the OFAC’s opinion was advisory and not a “final agency determination.” (Yarian Decl. ¶ 16 & Ex. 5.) However, the Cautionary Letter does constitute evidence that plaintiffs requested an advisory opinion because they engaged in an arrangement to ship goods to Iran that they knew or had reason to believe was unlawful and therefore enforceable.
For the foregoing reasons, defendant has shifted the burden on summary judgment to plaintiffs to demonstrate how the underlying oral contract is enforceable.
Plaintiffs do not dispute that the oral contract at issue here – an agreement between defendant Armond Rostami and plaintiff Jorjik Nazariyan to ship air conditioning parts and equipment to Iran – is potentially illegal. Rather, plaintiffs contend that, even if the Court were to find that the contract is illegal, the contract should be enforced because defendant was unjustly enriched. In so contending, plaintiffs point to findings by the U.S. Bankruptcy Court in an adversary proceeding in defendant’s bankruptcy petition, where the Bankruptcy Court denied defendant a discharge because he failed to account for the disposition of $400,000 in parts and equipment purportedly in Iran. (Young Decl. ¶ 5 & Ex. 3 at ¶¶ 37, 42, 44, 45.)
In Kashani v. Tsann Kuen China Enterprise Co., Ltd. (2004) 118 Cal.App.4th 531, the Court of Appeal found that the plaintiffs’ contract with the defendants to create a corporation in Iran and manufacture and sell notebook computers in Iran was illegal because it violated the trade sanctions against Iran effectuated by the ITSR. (Kashani, 118 Cal.App.4th at 547.) While the Kashani court recognized that, in circumstances of unjust enrichment, courts may enforce illegal contracts, the plaintiffs did not demonstrate a basis to deviate from the general practice not to enforce illegal contracts. (Id. at 557-58.)
While the plaintiffs in Kashani sought lost profits, plaintiffs here seek restitution and/or profits defendant made from the sale of parts and equipment that defendant has allegedly not shared with plaintiff. (Compl. ¶ 18; Prayer ¶ 2.) The question here is whether defendant’s alleged unjust enrichment is sufficient to outweigh the public policy concerns behind the ITSR. (Kashani, 118 Cal.App.4th 531, 550 [“No one could seriously contend that enforcement of the agreement in question is not outweighed by the public policy behind the governmental provisions”].) The Court of Appeal recognized the principle in Restatement (Third) of Restitution and Unjust Enrichment that, in some cases, “[s]ignificant negative consequences for deterrence will justify the court in denying relief, even in the face of substantial unjust enrichment.” (Kashani, 118 Cal.App.4th at 550; Restatement (Third) of Restitution and Unjust Enrichment § 32 (2011).) The Court of Appeal also recognized that the President of the United States issued executive orders “to deal with [Iran's] unusual and extraordinary threat to the national security, foreign policy, and economy of the United States.” (Kashani, 118 Cal.App.4th at 559 [citing Exec. Order No. 12959, 60 Fed.Reg. 24757 (May 6, 1995)].) Accordingly, the Court of Appeal found that violations of the regulations implementing the trade sanctions against Iran are contrary to the security interests of the United States. (Kashani, 118 Cal.App.4th at 559.)
Here, even though defendant may have been substantially and unjustly enriched by a failure to pay plaintiffs for the goods they shipped to defendant, plaintiffs do not deny that they knew the ultimate destination of the parts and equipment shipped to defendant was Iran. Here, like in Kashani, “[d]efendants are no more at fault in entering into the transaction than plaintiffs.” (Kashani, 118 Cal.App.4th at 558.) Accordingly, plaintiffs share moral fault in reaching the oral agreement with defendant. (Cf. Kelton v. Stravinski (2006) 138 Cal.App.4th 941, 949 [“Where the public cannot be protected because the transaction has been completed, where no serious moral turpitude is involved, where the defendant is the one guilty of the greatest moral fault, and where the defendant will be unjustly enriched at the expense of the plaintiff, the rule that courts will not enforce an agreement against public policy should not be applied”].)
Here, like in Kashani, “[e]ffective deterrence of violations of the Regulations will result from the refusal to enforce the agreement—not from enforcing the plaintiffs' claim.” (Kashani, 118 Cal.App.4th at 558.) Like in Kashani, the underlying oral contract in this action “involves such serious ramifications, including national security, that allowing plaintiffs damages for a breach of an illegal contract would be inconsistent with the rationale for the doctrine of unenforceability of illegal contracts: ‘Knowing that they will receive no help from the courts and must trust completely to each other's good faith, the parties are less likely to enter an illegal arrangement in the first place.’” (Kashani, 118 Cal.App.4th at 558 [quoting Lewis & Queen v. N.M. Ball Sons (1957) 48 Cal.2d 141, 150].) “The reason for this refusal [to enforce an illegal bargain] is not that the courts are unaware of possible injustice between the parties, and that the defendant may be left in possession of some benefit he should in good conscience turn over to the plaintiff, but that this consideration is outweighed by the importance of deterring illegal conduct.” (Lewis & Queen, 48 Cal.2d at 150.) Under the circumstances here presented, enforcing the oral contract would only reward plaintiffs for reaching and performing on a contract with an unlawful purpose and would be detrimental to the national security interests underlying the trade sanctions against Iran.
Further, defendant argues that plaintiff Nazariyan has a judgment against defendant in Iran. (Motion at 16.) Thus, the voiding of the oral contract here would not result in a disproportionately harsh penalty to plaintiffs. (Asdourian v. Araj (1985) 38 Cal.3d 276, 292, superseded by statute on other grounds [“In compelling cases, illegal contracts will be enforced in order to ‘avoid unjust enrichment to a defendant and a disproportionately harsh penalty upon the plaintiff.’ ”].) Although the Court does not take judicial notice of the Iranian judgment, defendant sufficiently authenticated the document. (Yarian Decl. ¶ 18 & Ex. 6.) Accordingly, the Court does consider the judgment as evidence that voiding the oral contract would not result in a disproportionately harsh penalty to plaintiffs because plaintiffs may have other relief available in Iran. In this vein, the Court notes that, in Iran, plaintiff Nazariyan accused defendant of wrongfully retaining money obtained from selling cooling equipment shipped to defendant between 2012 and 2016. (Yarian Decl. ¶ 18 & Ex. 6.) This accusation is the same as the allegation in this action. (Compl. ¶¶ 18, 19.) The Iranian judgment states that defendant “return the property.” (Yarian Decl. ¶ 18 & Ex. 6.) The Iranian judgment thus may provide for restitution to plaintiffs. But even if this Court were to disregard the Iranian judgment entirely, the outcome here would not change. Ultimately, the national security interests underlying the ISTR outweigh any interest of plaintiffs to recover on the underlying oral contract, particularly, where, as here, the undisputed evidence indicates that, for the purpose of financial gain, plaintiffs entered into an agreement with full knowledge the goods would end up in Iran.
Accordingly, because the oral contract underlying the Complaint is unlawful, plaintiff cannot seek to enforce such contract in this action.
D. Issue No. 3: The statute of limitations (“SOL”) on the oral contract has expired.
As a basis for granting summary adjudication on the breach of oral contract cause of action, defendant maintains that the two-year statute of limitations on the oral contract has expired. (CCP § 339(1).) A cause of action accrues when “the plaintiff discovers, or has reason to discover, the cause of action.” (Norgart v. Upjohn Co. (1999) 21 Cal.4th 383, 397.)
In the opposition, plaintiffs contend that defendant testified in his deposition that the problems concerning the oral agreement arose in 2017, three weeks after he started working for plaintiff Nazariyan in the United States. (Young Decl. ¶ 3 & Exhibit 1 at 23:13-24, 24: 3-9). However, the Court takes judicial notice of plaintiff Nazariyan’s averment in the prior action that he discovered defendants’ wrongful retention of proceeds from sales of the parts and equipment in 2015, not 2017. (UMF 8, 13; Def. RJN Ex. 7 at ¶ 12.) “The admission of fact in a pleading is a judicial admission. A judicial admission in a pleading is not merely evidence of a fact; it is a conclusive concession of the truth of the matter.” (Bucur v. Ahmad (2016) 244 Cal.App.4th 175, 187, internal quotations and citations omitted.) Plaintiffs are accordingly bound by Nazariyan’s admission in the prior action that he had reason to know of defendant’s breach of the oral contract in 2015. Because this action was filed more than two years later on March 5, 2018, the first cause of action for breach of oral contract is time-barred.
E. Issue No. 4: Rostami is entitled to an award of summary judgment on all remaining causes of action for Fraud, Conversion, Breach of Implied Covenant of Good Faith and Fair Dealing, Count of Goods Provided, Intentional Infliction of Emotional Distress, Negligent Infliction of Emotional Distress, and Loss of Consortium.
Defendant argues that all causes of action other than the first cause of action for breach of oral contract fail because they arise from breach of a void and illegal oral contract. Plaintiffs argue that, even if the breach of oral conduct cause of action is void, the other claims are actionable.
Plaintiffs’ assertion is not well taken. “A contract made contrary to public policy or against the express mandate of a statute may not serve as the foundation of any action, either in law or in equity . . . .” (Tiedje v. Aluminum Taper Milling Co. (1956) 46 Cal.2d 450, 453–54.) When a plaintiff cannot establish a case against a defendant without referencing the illegal transaction through which the plaintiff was a party, summary judgment is properly granted. (Waisbren v. Peppercorn Productions, Inc. (1995) 41 Cal.App.4th 246, 262 [“[I]t does not matter that some of [plaintiff]’s causes of action sounded in tort rather than contract. . . . Because all of [plaintiff]’s causes of action are based on his illegal agreement or business arrangement with [defendant] . . . the trial court properly disposed of the complaint in its entirety”].) Here, the second through eighth causes of action all arise from the illegal agreement between the parties and plaintiffs’ efforts to collect on the illegal agreement. Accordingly, summary judgment is appropriate.
The motion for summary judgment is GRANTED.
Within five (5) days hereof, defendant Armond Rostami is ordered to submit a proposed judgment of dismissal in accordance with this ruling.
Case Number: EC067759 Hearing Date: November 13, 2020 Dept: E
MOTION TO QUASH DEPOSITION SUBPOENAS
Date: 11/13/20 (2:00 PM)
Case: Jorjik Nazariyan et al. v. Armond Rostami (EC067759)
Plaintiffs Jorjik Nazariyan, Anahid Rostami and Number 1 Electric, Inc.’s Motion to Quash the Subpoenas for Document Production and Personal Deposition of Zaher Fallahi is GRANTED in part and DENIED in part.
Plaintiffs move to quash defendant Armond Rostami’s subpoena seeking the deposition of Zaher Fallahi and a separate subpoena seeking the production of documents related to his representation of plaintiffs with the U.S. Department of Treasury. (Young Decl. ¶ 2 & Ex. 4.)
Defendant contends that the motion is defective because it does not include a separate statement. Cal. Rule of Court 3.1345(a)(5) states that a motion to quash the production of documents at a deposition requires a separate statement. Where a moving party fails to provide a separate statement in support of a discovery motion, the Court has the discretion to deny the motion outright. (Mills v. U.S. Bank (2008) 166 Cal.App.4th 871, 892.) However, the requests and the arguments against them are relatively simple. Accordingly, the Court rules on the merits of the motion.
The Court finds that information from Zaher Fallahi, who represented plaintiffs Jorjik Nazariyan and Number 1 Electric, Inc. as their attorney, is relevant to this action. (Fallahi Decl. ¶ 2.) Fallahi wrote to the U.S. Department of Treasury Office of Foreign Assets Control (“OFAC”) regarding plaintiffs’ alleged violations of the trade embargo of Iran. (Yarian Decl. ¶ 7 & Ex. A.) The “Cautionary Letter” from OFAC states that the letter “does not constitute a final agency determination as to whether violations [of the trade embargo] have occurred,” but the letter also states that [plaintiff Number 1 Electric, Inc.]'s exports of used compressor, refrigerator, and air conditioner parts to the United Arab Emirates, with knowledge or reason to know that such exports were ultimately destined for Iran, appears to have violated” the embargo. (Yarian Decl. ¶ 7 & Ex. A.)
According to a previously filed complaint filed in 2017, Jorik Nazariyan et al. v. Armond Rostami, Case No. BC671662, plaintiff Nazariyan allegedly paid to ship commercial air conditioning system parts and equipment to defendant in Iran, which defendant would sell at a markup and share the profit with Nazariyan. (Yarian Decl. ¶ 3; BC671662 Complaint.) In defendant’s motion for summary judgment filed on September 25, 2020, defendant contends that the oral contract is illegal and unenforceable due to the trade embargo against Iran, which defendant contends prohibits the exportation, directly or indirectly, to Iran of any goods, technology, or services from the United States. Nazariyan later dismissed the BC671662 Complaint. (Yarian Decl. ¶ 4.) Nazariyan and the other plaintiffs later filed this action where Iran is not mentioned in the complaint. (Yarian Decl. ¶ 5; see generally Complaint.) The underlying contract in this action resembles the complaint alleged in Case No. BC671662. (Compare EC067759 Compl. ¶ 13 with BC671662 Compl. ¶¶ BC-1, BC-2.)
Accordingly, despite Fallahi’s averment that this communication regarding OFAC was unrelated to this action (Fallahi Decl. ¶ 2), information from Fallahi concerning his communications with OFAC concerning his clients’ dealings with Iran may be relevant to his affirmative defense that the oral contract underlying this action is illegal. (See Answer, 6th Affirmative Defense.)
Nevertheless, deposing a party’s attorney is not to be taken lightly. “Depositions of opposing counsel are presumptively improper, severely restricted, and require ‘extremely’ good cause—a high standard.” (Carehouse Convalescent Hospital v. Superior Court (2006) 143 Cal.App.4th 1558, 1562.) Here, Fallahi is not opposing counsel in this action. Yet, “[a]ttorney depositions chill the attorney-client relationship, impede civility and easily lend themselves to gamesmanship and abuse.” (Carehouse, 143 Cal.App.4th at 1563.) Defendant insists that he solely intends to inquire into the documents an information that Fallahi sent or communicated to third parties regarding plaintiff’s business dealings with defendant. However, this objective is sufficiently accomplished by requests for Fallahi to produce documents submitted and received to the U.S. Department of Treasury in relation to plaintiff Nazariyan and Number 1 Electric, Inc. Defendant does not explain what he could ask Fallahi during a deposition that would not be protected by the attorney-client privilege or the attorney work product doctrine. (See Sullivan v. Superior Court (1972) 29 Cal.App.3d 64, 69 [“To successfully invoke the lawyer-client privilege, three requirements must be met. There must be a (1) communication, (2) intended to be confidential, and (3) made in the course of the lawyer-client relationship”]; CCP § 2018.030(a) [any writing reflecting the attorney’s mental impressions, conclusions, opinions, or legal research or theories will not be discoverable under any circumstances].)
Accordingly, the Court finds the motion to quash the subpoena seeking to take the deposition of Fallahi should be granted without prejudice to defendant later seeking to depose Fallahi should defendant’s review of Fallahi’s subpoenaed documents and further investigation lead to topics or areas of inquiry that would not violate protections of the attorney-client privilege or work-produce doctrine.
With respect to the subpoena asking for production of documents, any protection in the documents Fallahi sent to OFAC under the attorney-client privilege or work product doctrine was waived when he sent the documents. (Evid. Code § 912(a) [“Except as otherwise provided in this section, the right of any person to claim a privilege provided by Section 954 (lawyer-client privilege) . . . is waived with respect to a communication protected by the privilege if any holder of the privilege, without coercion, has disclosed a significant part of the communication or has consented to disclosure made by anyone”]; McKesson HBOC, Inc. v. Superior Court (2004) 115 Cal.App.4th 1229, 1239 [“Waiver [of work product protection] also occurs by an attorney's ‘voluntary disclosure or consent to disclosure of the writing to a person other than the client who has no interest in maintaining the confidentiality of the contents of the writing.’ [Citation.]”].) Likewise, the attorney-client privilege and work product doctrine does not apply to any documents that OFAC sent to Fallahi.
Accordingly, the motion is GRANTED in part and DENIED in part. The deposition subpoena for personal appearance of Zaher Fallahi is QUASHED. Deponent Zaher Fallahi is ordered to comply with the deposition subpoena for production of the requested documents within fifteen (15) days hereof.