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This case was last updated from Los Angeles County Superior Courts on 06/10/2019 at 07:39:13 (UTC).

MARCOS DE LA TOBA ET AL VS ROYAL PARK MOTEL LP ET AL

Case Summary

On 12/22/2017 MARCOS DE LA TOBA filed a Personal Injury - Other Personal Injury lawsuit against ROYAL PARK MOTEL LP. 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:

    ****8129

  • Filing Date:

    12/22/2017

  • Case Status:

    Pending - Other Pending

  • Case Type:

    Personal Injury - Other Personal Injury

  • Court:

    Los Angeles County Superior Courts

  • Courthouse:

    Stanley Mosk Courthouse

  • County, State:

    Los Angeles, California

 

Party Details

Plaintiffs, Petitioners and Guardian Ad Litems

SLAVIN CAROLINA

MOORE STEVEN

BAILEY CARLON

MOORE TIFFANY

DE LA TOBA MARCOS

BAILEY CARLTON

Defendants and Respondents

DC WANG INC.

ROYAL PARK MOTEL LP

WANG GERALD

WANG DIANE

DOES 1 THROUGH 50

Attorney/Law Firm Details

Plaintiff and Petitioner Attorney

NOVAK SEAN M. ESQ.

Defendant Attorney

MARSHALL JONATHAN D.

 

Court Documents

PROOF OF SERVICE SUMMONS

2/16/2018: PROOF OF SERVICE SUMMONS

PROOF OF SERVICE SUMMONS

2/16/2018: PROOF OF SERVICE SUMMONS

REQUEST FOR TRIAL BY JURY AND NOTICE OF JURY FEE DEPOSIT

3/23/2018: REQUEST FOR TRIAL BY JURY AND NOTICE OF JURY FEE DEPOSIT

PLAINTIFFS' OPPOSITION TO DEFENDANTS' DEMURRER

4/17/2018: PLAINTIFFS' OPPOSITION TO DEFENDANTS' DEMURRER

PLAINTIFFS' OPPOSITION TO DEFENDANTS' MOTION TO STRIKE

4/17/2018: PLAINTIFFS' OPPOSITION TO DEFENDANTS' MOTION TO STRIKE

DEFENDANTS' REPLY TO OPPOSITION TO MOTION TO STRIKE PORTIONS OF PLAINTIFFS' COMPLAINT

4/20/2018: DEFENDANTS' REPLY TO OPPOSITION TO MOTION TO STRIKE PORTIONS OF PLAINTIFFS' COMPLAINT

DEFENDANT'S REPLY TO PLAINTIFF'S OPPOSITION TO DEMURRER TO PLAINTIFF'S FIRST AMENDED COMPLAINT

4/20/2018: DEFENDANT'S REPLY TO PLAINTIFF'S OPPOSITION TO DEMURRER TO PLAINTIFF'S FIRST AMENDED COMPLAINT

Minute Order

5/10/2018: Minute Order

PLAINTIFFS NOTICE OF RESETTING TRIAL AND CALENDAR DATES

5/17/2018: PLAINTIFFS NOTICE OF RESETTING TRIAL AND CALENDAR DATES

DEFENDANTS' REPLY IN SUPPORT OF MOTION TO STRIKE PORTIONS OF PLAINTIFFS' COMPLAINT

7/9/2018: DEFENDANTS' REPLY IN SUPPORT OF MOTION TO STRIKE PORTIONS OF PLAINTIFFS' COMPLAINT

Opposition

11/1/2018: Opposition

Minute Order

11/15/2018: Minute Order

Notice

11/19/2018: Notice

Minute Order

2/7/2019: Minute Order

Motion to Compel

5/10/2019: Motion to Compel

Motion to Compel Discovery

5/10/2019: Motion to Compel Discovery

Motion to Compel

5/10/2019: Motion to Compel

Motion to Deem RFA"s Admitted

5/10/2019: Motion to Deem RFA"s Admitted

29 More Documents Available

 

Docket Entries

  • 06/07/2019
  • at 08:32 AM in Department 73; Final Status Conference - Not Held - Continued - Stipulation

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  • 05/10/2019
  • Motion to Deem RFA's Admitted; Filed by Gerald Wang (Defendant)

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  • 05/10/2019
  • Motion to Compel (Statement of Damages); Filed by Gerald Wang (Defendant)

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  • 05/10/2019
  • Motion to Deem RFA's Admitted; Filed by Gerald Wang (Defendant)

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  • 05/10/2019
  • Motion to Compel (Statement of Damages); Filed by Gerald Wang (Defendant)

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  • 05/10/2019
  • Motion to Compel (MTC Statement of Damages); Filed by Gerald Wang (Defendant)

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  • 05/10/2019
  • Motion to Deem RFA's Admitted; Filed by Gerald Wang (Defendant)

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  • 05/10/2019
  • Motion to Compel (Statement of Damages); Filed by Gerald Wang (Defendant)

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  • 05/10/2019
  • Motion to Deem RFA's Admitted; Filed by Gerald Wang (Defendant)

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  • 05/10/2019
  • Motion to Compel Discovery (not Further Discovery) - 1 moving party, 1 motion; Filed by Gerald Wang (Defendant)

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52 More Docket Entries
  • 02/16/2018
  • PROOF OF SERVICE SUMMONS

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  • 02/16/2018
  • PROOF OF SERVICE SUMMONS

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  • 02/16/2018
  • Proof-Service/Summons; Filed by Marcos De La Toba (Plaintiff)

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  • 02/16/2018
  • Proof-Service/Summons; Filed by Marcos De La Toba (Plaintiff)

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  • 02/16/2018
  • Proof-Service/Summons; Filed by Marcos De La Toba (Plaintiff)

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  • 02/16/2018
  • Proof-Service/Summons; Filed by Marcos De La Toba (Plaintiff)

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  • 02/16/2018
  • PROOF OF SERVICE SUMMONS

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  • 02/16/2018
  • PROOF OF SERVICE SUMMONS

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  • 12/22/2017
  • PLAINTIFFS' COMPLAINT FOR DAMAGES

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  • 12/22/2017
  • Complaint; Filed by Marcos De La Toba (Plaintiff); Carolina Slavin (Plaintiff); Tiffany Moore (Plaintiff) et al.

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Tentative Rulings

Case Number: BC688129    Hearing Date: February 04, 2021    Dept: 73

2/4/2021

Dept. 73

Rafael Ongkeko, Judge presiding

MARCOS DE LA TOBA, et al. v. ROYAL PARK MOTEL, LP, et al. (BC688129)

Counsel for Plaintiffs/opposing parties: Sean Novak, Farbod Youmtobian (The Novak Law Firm, PC)

Counsel for Defendants/moving parties: William Slaughter, Jonathan Marshall, Elizabeth Southerland (Slaughter, Reagan & Cole, LLP)

Other counsel: Omitted.

DEFENDANTS’ MOTION FOR summary judgment, or in the alternative, summary adjudicAtion (filed 12/8/2020)

TENTATIVE RULING

The motion for summary judgment is denied.

The motion for summary adjudication is granted as to the “Fraud/Deceit/Intentional Misrepresentations of Fact” (9th cause of action listed on the caption page, but listed in error as 10th in the body of the complaint) in favor of Diane Wang, only, and against Plaintiffs. The motion for summary adjudication is denied as to every other cause of action. Defendants have not met their prima facie burden in moving for summary adjudication. Even if they may have, Plaintiffs have easily established triable issues of material fact.

Discussion

Factual and procedural background.

Plaintiffs Marcos de La Toba, Carolina Slavin, Tiffany Moore, Carlton Bailey, and Steven Moore, by and through his Guardian ad Litem, Tiffany Moore, sue Defendants Royal Park Motel, LP, DC Wang, Inc., Gerald Wang, and Diane Wang for uninhabitable conditions.

Defendants are, at all relevant times, the owner(s) of and/or the manager(s) responsible for maintaining, and repairing the subject property located at 1906 W. 3rd Street, Los Angeles, CA 90057. Plaintiffs allege that, prior to moving into the subject property, Plaintiffs executed a multi-page written standard residential lease agreement for each tenancy. The complaint alleges that Defendants knew that the living units were uninhabitable at the time, based on actual or constructive notice of the previous tenants residing therein. The complaint alleges that, between June 2017 and the present, Plaintiffs have repeatedly notified Defendants of the defects in the premises but have failed and refused to remedy the situation.

Plaintiffs allege injuries from Defendants’ failure to abate slum housing conditions, including, but not limited to, toxic mold, asbestos, unlawful lead exposure, vermin infestation, cockroaches, and deplorable living conditions.

On December 22, 2017 Plaintiffs filed this lawsuit. After a demurrer was sustained with leave to amend, Plaintiffs filed a First Amended Complaint on July 30, 2018. Plaintiff’s operative FAC alleges:

C/A 1: Breach of Implied Warranty of Habitability (Civ. Code, § 1941.1)

C/A 2: Breach of Warranty of Habitability (Health & Safety Code, § 17920.3)

C/A 3: Breach of Warranty of Habitability (Civ. Code, § 1942.4)

C/A 4: Negligence – Premises Liability

C/A 5: Nuisance

C/A 6: Intentional Infliction of Emotional Distress

C/A 7: Breach of Contract

C/A 8: Breach of Covenant of Quiet Enjoyment

C/A 9: Fraud/Deceit/Intentional Misrepresentation of Facts (Note: Page 29 of the FAC labels this cause of action in error as the 10th)

On December 8, 2020 Defendants[1] filed a motion for summary judgment or, in the alternative, summary adjudication. They primarily argue that Gerald Wang and Diane Wang, as limited partners in Royal Park Motel, LP (“Royal Park”), and officers, directors and/or shareholders of DC Wang, Inc. (“DC Wang”), cannot be held personally liable. On January 15, 2021 Plaintiffs filed an opposition, arguing that Gerald Wang and Diane Wang can be held personally liable because triable issues of fact exist regarding whether (1) they were or were limited partners, (2) whether they were agents, and/or (3) whether these entities were their alter egos. While the legal basis of their opposition focuses on personal liability, Plaintiffs submit hundreds of pages of documents related to habitability issues. On January 26, 2021 Defendants filed a reply. While their reply focuses on the discrete issues of Gerald Wang and Diane Wang’s personal liability, Defendants also submitted hundreds of pages of new evidence related to habitability issues.

For purposes of this motion, the court disregards the substantive merits of any habitability evidence as those issues, as such, are not at issue in the motion. The court focuses its analysis on whether or not Defendants have met their burden on summary judgment and, if so, whether triable issues of material fact exist regarding whether or not Gerald Wang and Diane Wang can be held individually liable.

ANALYSIS

A. Request for Judicial Notice/Evidentiary Objections

The court finds that the parties’ submission of voluminous irrelevant exhibits (and, therefore, corresponding objections to such evidence) to be a waste of judicial time and resources. The motion presents very discrete issues of law that do not require an exploration of the alleged facts of habitability. The parties should have only submitted evidence relating to the individual defendants’ liability (e.g., evidence showing factors related to the legal standards for alter ego and limited partner liability, and vicarious liability theories). Instead, Plaintiffs bombarded the court with hundreds of pages of evidence and argument related to habitability issues, cited to dozens of deposition transcripts related to habitability issues (in disputing the individual defendants’ limited partner status), and mischaracterized testimony. For the court to verify each “disputed fact,” therefore, the court had to scour thousands of pages of documents and check over a dozen factual citations for each, when the majority of those citations did not relate to the “material fact” that was disputed and were merely cut-and-paste regurgitations of Plaintiffs’ opposition to each separate statement. This, in turn, resulted in Defendants’ filing a reply, in which they submitted hundreds of pages of “new evidence,” and over 100 pages of evidentiary objections. The court estimates that 75% of the paper on this motion as been dedicated to irrelevant issues. The court admonishes the parties that the court may issue sanctions against the parties in the future if the parties repeat this type of conduct in this case or in the related cases. With this admonition in mind, the court rules on the evidentiary issues as follows:

Moving Request for Judicial Notice: Granted.

Opposition Evidentiary Objections: Objections 1-5 (erroneously numbered 1-4 with a duplicate 4) are all overruled.

Reply Evidentiary Objections: The court will not entertain over 100 pages of objections. Rather than addressing each objection, line by line, which is not required in any event, the court rules as follows relating to objections Defendants make concerning Plaintiffs’ 830-page Compendium of exhibits:

· Exhibit A: Any objections overruled

· Exhibit B: Any objections overruled

· Exhibit C: Any objections sustained; not considered; irrelevant

· Exhibit D: Any objections sustained; not considered; irrelevant

· Exhibit E: Any objections sustained; not considered; irrelevant

· Exhibit F: Any objections sustained, except pages 78, 102, 139, 250-251, 254-255 will be considered

· Exhibit G: Any objections sustained; not considered; irrelevant

· Exhibit H: Any objections sustained; not considered; irrelevant

· Exhibit I: Any objections sustained; not considered; irrelevant

· Exhibit J: Any objections sustained; not considered; irrelevant

· Exhibit K: Any objections sustained; not considered; irrelevant

· Exhibit L: Any objections sustained; not considered; irrelevant

· Exhibit M: Any objections sustained; not considered; irrelevant

· Exhibit N: Any objections sustained; not considered; irrelevant

· Exhibit O: Any objections sustained; not considered; irrelevant

· Exhibit P: Any objections sustained; not considered; irrelevant

· Exhibit Q: Any objections sustained; not considered; irrelevant

· Exhibit R: Any objections sustained; not considered; irrelevant

· Exhibit S: Any objection sustained; not considered; irrelevant

· Exhibit T: Any objections sustained; not considered; irrelevant

· Exhibit U: Any objections overruled

· Exhibit V: Any objections overruled

· Exhibit W: Any objections overruled

· Exhibit X: Any objections overruled

· Exhibit Y: Any objections overruled

· Exhibit Z: Any objections overruled

· Exhibit AA: First page of AA admissible; the remainder of AA, any objections sustained

· Exhibit BB: Any objections sustained; not considered; irrelevant

· Exhibit CC: Any objections sustained; not considered; irrelevant

· Exhibit DD: Any objections sustained; not considered; irrelevant

· Exhibit EE: Any objections sustained; not considered; irrelevant

· Exhibit FF: Any objections sustained; not considered; irrelevant

· Exhibit GG: Any objections sustained; not considered; irrelevant

· Exhibit HH: Any objections overruled

· Exhibit II: Any objections overruled

· Exhibit JJ: Any objections sustained; not considered; irrelevant

· Exhibit KK: Pages 23, 24 admissible; remainder: any objections sustained

· Exhibit LL: Any objections overruled

· Exhibit NN: Any objections sustained; not considered; irrelevant

· Exhibits 1-8; 10-23: Court shall only consider these exhibits to show that individual defendants were the contact person for various issues relating to the property; any other objections related to these exhibits are sustained—court will not consider substance or truth of the matter asserted in these exhibits.

· Ex 9: Any objections overruled

The court will not consider Defendants’ reply evidence; their response to Plaintiffs’ separate statement; or their reliance on Corporations Code § 15632.

The court does not consider the first 242 pages of Defendants’ 691-page Response to Plaintiff’s Separate Statement (filed 1/26/21, i.e., SS #1-112, ending p. 242). There is no provision in the summary judgment statute allowing a reply separate statement. (Nazir v. United Airlines, Inc. (2009) 178 Cal.App.4th 243, 252.)

Further, as far as Defendants’ reply evidence: “The general rule of motion practice, which applies here, is that new evidence is not permitted with reply papers.” (Jay v. Mahaffey (2013) 218 Cal. App. 4th 1522, 1537–38). “This principle is most prominent in the context of summary judgment motions, which is not surprising, given that it is a common evidentiary motion.” (Id.) “This rule is based on the same solid logic applied in the appellate courts, specifically, that ‘[p]oints raised for the first time in a reply brief will ordinarily not be considered, because such consideration would deprive the respondent of an opportunity to counter the argument.”’ (Id.) This ruling includes Defendants’ Compendium of Exhibits to be filed under seal (i.e., Exhibits 1-3), for which no application or order to seal has been received, nor has the court seen a Notice of Lodging or proof of service thereof, much less an electronically filed public document evidencing submission of these documents to the court under seal. As such, the submission is an unauthorized ex parte communication. The court notes that the Marshall reply declaration (filed 1/26/21, at ¶¶32-34) only refers to these exhibits in a conclusory manner without further authentication or foundation, and good cause or other basis (such as pursuant to the parties’ protective order) to warrant a conditional sealing.

Defendants’ Reply cites Gruendel v. Oewel Partnership (1997) 55 Cal.App.4th 654, which, in turn relies on a now-repealed section, Corp. Code § 15632 (repealed Jan. 1, 2010). While section 15632 has some similarities with the later-enacted Corp. Code § 15903.03 (eff. Jan. 1, 2007), it was no longer in effect after 2010. The court discusses section 15903.03, infra.

B. Standard for Motion for Summary Adjudication/Judgment

“Summary judgment shall be granted if all the papers submitted show that there is no triable issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. In determining if the papers show that there is no triable issue as to any material fact, the court shall consider all of the evidence set forth in the papers, except the evidence to which objections have been made and sustained by the court, and all inferences reasonably deducible from the evidence, except summary judgment shall not be granted by the court based on inferences reasonably deducible from the evidence if contradicted by other inferences or evidence that raise a triable issue as to any material fact.” (Cal. Code. Civ. Proc., § 437c, subd. (c)).

“A party may move for summary adjudication of issues, either by itself or as an alternative to summary judgment if it appears that the proof supports the granting of the motion for summary adjudication as to some but not all the issues involved in the action, or that one or more of the issues raised by a claim is admitted, or that one or more of the issues raised by a defense is conceded, the court shall, by order, specify that those issues are without substantial controversy. Moreover, upon a motion for summary adjudication, the court shall, by written order or oral order recorded verbatim, specify those issues raised by the motion for summary adjudication as to which there exists a material, triable controversy, and shall specifically refer to the evidence which establishes a triable issue of fact regarding each of those issues ....” (Cal. Code. Civ. Proc. § 437c(f).)

A defendant moving for summary judgment/summary adjudication must show “that one or more elements of the cause of action . . . cannot be established, or that there is a complete defense to the cause of action.” (Code Civ. Proc., § 437c, subd. (p)(2); see also, Code Civ. Proc., § 437c, subd. (o).)

“[T]he initial burden is always on the moving party to make a prima facie showing that there are no triable issues of material fact.” (Scalf v. D. B. Log Homes, Inc. (2005) 128 Cal.App.4th 1510, 1519.) A defendant moving for summary judgment or summary adjudication “has met his or her burden of showing that a cause of action has no merit if the party has shown that one or more elements of the cause of action . . . cannot be established, or that there is a complete defense to the cause of action.” (Code Civ. Proc., § 437c, subd. (p)(2).) A moving defendant need not conclusively negate an element of plaintiff’s cause of action. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 854.) To meet this burden of showing a cause of action cannot be established, a defendant must show not only “that the plaintiff does not possess needed evidence” but also that “the plaintiff cannot reasonably obtain needed evidence.” (Aguilar, supra, 25 Cal.4th at p. 854.) It is insufficient for the defendant to merely point out the absence of evidence. (Gaggero v. Yura (2003) 108 Cal.App.4th 884, 891.) The defendant “must also produce evidence that the plaintiff cannot reasonably obtain evidence to support his or her claim.” (Id.)  The supporting evidence can be in the form of affidavits, declarations, admissions, depositions, answers to interrogatories, and matters of which judicial notice may be taken. (Aguilar, supra, 25 Cal.4th at p. 855.)

“Once the defendant . . . has met that burden, the burden shifts to the plaintiff . . . to show that a triable issue of one or more material facts exists as to the cause of action or a defense thereto.” (Code Civ. Proc., § 437c, subd. (p)(2).) The plaintiff may not merely rely on allegations or denials of its pleadings to show that a triable issue of material fact exists, but instead, “shall set forth the specific facts showing that a triable issue of material fact exists as to the cause of action.” (Id.) “If the plaintiff cannot do so, summary judgment should be granted.” (Avivi v. Centro Medico Urgente Medical Center (2008) 159 Cal.App.4th 463, 467.)

C. Defendants’ Motion for Summary Judgment

The individual Defendants argue that they cannot be held liable as limited partners in Royal Park Motel, LLP, and/or as shareholders, officers, or directors in DC Wang, Inc. For their prima facie case, Defendants offer the following evidence:

· A grant deed that shows that Royal Park Motel, LP owns the motel. (Mvg. RJN, Ex. A).

· A certificate of limited partnership, filed November 22, 2013, that names DC Wang, Inc., as a general partner, signed by Diane Wang, as president of DC Wang, Inc. (Mvg. Ex. B).

· A one-page November 18, 2013 articles of incorporation for DC Wang, Inc., that lists Diane Wang as an agent, with a street address of 706 N. 1st Ave., Arcadia, CA 91006 for the corporation (the same address as Diana Wang). (Mvg. Ex. C).

· A declaration by Diane Wang, dated November 16, 2020, that she is a limited partner in Royal Park Motel, LP and a shareholder, board member, and president of DC Wang, Inc. (Mvg. Diane Wang Decl., ¶¶ 2-6).

· A declaration by Gerald Wang, dated November 16, 2020, that he is a limited partner in Royal Park Motel, LP, and a board member and secretary of DC Wang, Inc. (Mvg. Gerald Wang Decl., ¶¶ 3-6).

· Testimony by Diane and Gerald Wang that DC Wang, Inc., is the general partner in Royal Park Motel, LP. (Mvg. Wang Decls., ¶ 6).

· Testimony by Diane and Gerald Wang that Royal Park Motel, LP owned the motel between December 19, 2013 and December 5, 2018. (Mvg. Wang Decls., ¶ 6).

Defendants offer the following legal authority to support their motion:

· A limited partnership is an entity distinct from its partners. (Cal. Corp. Code. § 15901.04(a)).

· All general partners are jointly and severally liable for limited partnership obligations unless otherwise agreed by the claimant or provided by law. (Cal. Corp. Code. 15904.04(a).).

· A corporation is regarded as a legal entity, separate and distinct from its stockholders, officers and directors, with separate and distinct liabilities and obligations. (Sonora Diamond Corp. v. Superior Court (2004) 83 Cal. App. 4th 523, 538; Desaigoudar v. Meyercord, (2003) 108 Cal. App. 4th 173, I 83).

· Generally, shareholders are not liable for the obligations and torts of the corporation. (Wyatt v. Union Mortgage Co. (1979) 24 Cal. 3d 773, 785).

Such as, repeated mantra-like throughout, comprise the extent of Defendants’ motion. As Plaintiffs correctly argue, Defendants bear the initial burden of proof. Defendants bear the burden of establishing a complete defense to Plaintiffs’ causes of action. As stated above, to do so, a defendant must show not only “that the plaintiff does not possess needed evidence” but also that “the plaintiff cannot reasonably obtain needed evidence.” (Aguilar, supra, 25 Cal.4th at p. 854.) Defendants’ barebones motion with minimal legal authority or factual evidence fails to meet this burden.

First, in citing only partial statutory language in Corp. Code § 15903.03(a), Defendants completely fail to address the rest of the statute- that circumstances may exist where a limited partner may be liable to a third party or those with whom it transacts business. The Corporations Code provides:

A limited partner is not liable for any obligation of a limited partnership unless named as a general partner in the certificate or, in addition to exercising the rights and powers of a limited partner, the limited partner participates in the control of the business. If a limited partner participates in the control of the business without being named as a general partner, that partner may be held liable as a general partner only to persons who transact business with the limited partnership with actual knowledge of that partner's participation in control and with a reasonable belief, based upon the limited partner's conduct, that the partner is a general partner at the time of the transaction. Nothing in this chapter shall be construed to affect the liability of a limited partner to third parties for the limited partner's participation in tortious conduct.

(Cal. Corp. Code § 15903.03(a)). Further, “a limited partner does not have the right or the power as a limited partner to act for or bind the limited partnership.” (Cal. Corp. Code § 15903.02). For historical context, one court explained the legislative intent for creating a limited liability partnership: “The obvious purpose underlying legislative recognition of this type of business entity was to encourage trade by permitting ‘a person possessing capital to invest in business and to reap a share of the profits of the business, without becoming liable generally for the debts of the firm, or risking in the venture more than the capital contributed, provided he does not hold himself out as a general partner, or participate actively in the conduct of the business.’” (Evans v. Galardi (1976) 16 Cal. 3d 300, 306). Accordingly, simply showing that the individual Defendants are limited partners does not absolutely absolve them from liability. Yet, the only evidence that the Defendants provide is testimony that Diane Wang and Gerald Wang were limited partners. There is no evidence that they did not participate in the control of the business. There is no evidence that they did not hold themselves to others to be general partners to Plaintiffs. There is no evidence that they did not have the power to bind the limited partnership.[2] While they testify that DC Wang, Inc., is the general partner, they offer no evidence regarding the duties, responsibilities, purpose of DC Wang, the persons that DC Wang employed, if any, to act as “general partner” of the motel, etc. Nor do they offer any evidence to establish that they were merely passive investors who had no active participation in the operations of the limited partnership. Finally, they offer absolutely no analysis or evidence that they did not engage in any tortious conduct about which Plaintiffs complain. This lack of evidence coupled with the fact that Defendants make absolutely no showing that “plaintiff cannot reasonably obtain evidence to support his or her claim” is insufficient to meet their initial burden of proof of a complete defense to Plaintiffs’ claims.

Second, while the individual Defendants state the general rule that shareholders are normally not liable for a corporation’s liabilities, they fail to address their status as officers and directors of the corporation.

Being a “[c]orporate director or officer status [does not] immunize[ ] a person from personal liability for tortious conduct ... . [¶] A corporate director or officer's participation in tortious conduct may be shown not solely by direct action but also by knowing consent to or approval of unlawful acts. [Citations.] ... [¶] The legal fiction of the corporation as an independent entity was never intended to insulate officers and directors from liability for their own tortious conduct. [Citations.] ... [¶] ... [¶] All persons who are shown to have participated in an intentional tort are liable for the full amount of the damages suffered.

(Asahi Kasei Pharma Corp. v. Actelion Ltd. (2014) 222 Cal. App. 4th 945, 966). Further, “[s]hareholders, officers, and directors of corporations have [also] been held personally liable for intentional torts when they knew or had reason to know about but failed to put a stop to tortious conduct.” (Id. at 966). Accordingly, simply by contending that they are shareholders, board members, and officers of DC Wang, Inc. does not absolutely absolve them from liability. They have offered no evidence of a complete defense—e.g., that they did not know, consent, or approve of any unlawful acts and/or did not participate in any of the torts about which Plaintiffs complain.

Finally, the individual Defendants (particularly shareholder Diane Wang, as to DC Wang, Inc.) argue that they are not alter egos of either Royal Park Motel, LP, or DC Wang, Inc. In so doing, the only evidence they offer is testimony from Diane Wang and Gerald Wang that they have never comingled personal assets with the business assets of DC Wang, Inc. or Royal Park Motel, LP. (Mvg. Wang Decls.,¶ 7). Further, they categorially argue that “Plaintiffs cannot prove any of the ‘alter ego’ allegations to be true.”

There are two general requirements for piercing the corporate veil: (1) that there be such unity of interest and ownership that the separate personalities of the corporation and the individual no longer exist and (2) that, if the acts are treated as those of the corporation alone, an inequitable result will follow. (Greenspan v. LADT, LLC (2010) 191 Cal.App.4th 486, 511.) Whether the evidence has established that the corporate veil should be ignored is primarily a question of fact which should not be disturbed when supported by substantial evidence.” (Id. at 512; quoting Las Palmas Associates v. Las Palmas Center Associates (1991) 235 Cal.App.3d 1220, 1248.)

“The first requirement for disregarding the corporate entity under the alter ego doctrine—whether there is sufficient unity of interest and ownership that the separate personalities of the individual and the corporation no longer exist—encompasses a series of factors. Among the many factors to be considered in applying the doctrine are one individual’s ownership of all stock in a corporation; use of the same office or business location; commingling of funds and other assets of the individual and the corporation; an individual holding out that he is personally liable for debts of the corporation; identical directors and officers; failure to maintain minutes or adequate corporate records; disregard of corporate formalities; absence of corporate assets and inadequate capitalization; and the use of a corporation as a mere shell, instrumentality or conduit for the business of an individual. (Zoran Corp. v. Chen (2010) 185 Cal. App. 4th 799, 811-12.) This list of factors is not exhaustive, and these enumerated factors may be considered with others under the particular circumstances of each case. “‘No single factor is determinative, and instead a court must examine all the circumstances to determine whether to apply the doctrine.’” (Id. at 812.).”

“[T]he second requirement for application of the alter ego doctrine is a finding that the facts are such that adherence to the fiction of the separate existence of the corporation would sanction a fraud or promote injustice. (Wood v. Elling Corp. (1977) 20 Cal.3d 353, 365, fn. 9.) The test for this requirement is that if the acts are treated as those of the corporation alone, it will produce an unjust or inequitable result. (Mesler v. Bragg Management Co. (1985) 39 Cal.3d 290, 300.” (Ibid.)

Defendants’ motion does not offer any evidence on, or analyze, any of these factors. There is no evidence regarding the individual defendants’ ownership in the stock of the corporation, use of the same address (business and residential), whether the directors or officers of DC Wang are identical, how they maintain minutes or corporate records, how they adhere by corporate formalities, what the corporate assets were, what the capitalization was, and whether or not they used DC Wang as a shell. It is insufficient for the defendant to merely point out the absence of evidence. (Gaggero v. Yura (2003) 108 Cal.App.4th 884, 891.) The defendant “must also produce evidence that the plaintiff cannot reasonably obtain evidence to support his or her claim.” (Id.) Merely testifying that they did not commingle assets is insufficient to show that plaintiff cannot reasonably obtain evidence to show that Defendants were alter egos.[3]

Given that the individual Defendants fail to offer sufficient evidence to establish a complete defense to Plaintiffs’ claims that absolutely immunized them from liability, the motion for summary judgment is denied.

D. Defendants’ Motion for Summary Adjudication

1. First through Sixth Causes of Action

Defendants make the same argument and offer the same facts for Plaintiffs’ first through sixth causes of action. As the court found, Defendants have not met their prima facie burden of establishing that they are immunized from liability merely due to their limited partner/shareholder/officer status. Summary adjudication is denied as to these causes of action.

2. Seventh and Eighth Causes of Action for Breach of Contract and Breach of Covenant of Quiet Enjoyment

Defendants argue that these causes of action fail because any purported lease was between Plaintiffs and Royal Park Motel, LP—not the individual defendants. As the court discussed above, Plaintiffs also have alleged alter ego liability—i.e., that the individual defendants may be both directly and vicariously liable for the contractual obligations of the limited partnership. As the court explained above, Defendants have not met their initial burden of establishing that they are not alter egos of Royal Park Motel, LP, and/or that they followed the corporate form. Further, as the court noted in footnote 3, triable issues of fact exist on this issue. The motion is denied as to these causes of action.

3. Ninth (Erroneously Named Tenth in the body of the complaint) Cause of Action for Fraud/Deceit Against Diane Wang

Defendants argue that Diane Wang cannot be liable for fraud or for any intentional misrepresentations because Plaintiffs have not alleged or offered any evidence that Diane Wang made any misrepresentations to Plaintiffs. The complaint only alleges misrepresentations from Gerald Wang. Defendants offer testimony from Plaintiffs that they had very minimal contact and/or no contact with Diane Wang—i.e., there are no representations, let alone misrepresentations. (Mvg. Exs. D & E). The court finds that, by this evidence, Defendants have met their prima facie burden on this cause of action as against Diane Wang.

In opposition, while Plaintiffs make general arguments that Diane Wang is intimately involved with operating the property and argue that Plaintiffs “were deceived and defrauded by the agents, managers, or employees of Defendants,” they do not offer any specific evidence of how Diane Wang, defrauded them. There is no evidence of any purported specific representation that Diane Wang made to any of the Plaintiffs, how that was a misrepresentation, and how Plaintiffs relied on that misrepresentation to their detriment. Plaintiffs have not met their burden of establishing a triable issue of fact on this cause of action as against Diane Wang.

The motion for summary adjudication is granted as to the Fraud/Deceit/Intentional Misrepresentation of Fact (ninth cause of action on the caption of complaint; tenth cause of action in the body of the complaint) in favor of Diane Wang, only, and against Plaintiffs.

Unless waived, notice of ruling by Plaintiffs.


[1]The amended notice for the motion states that all defendants are the moving parties. Their memorandum clarifies that the motion is on behalf of Gerald Wang and Diane Wang, in their individual capacities. (See, e.g. Amended Notice of Motion, 1:14-15)

[2]Further, and in any event, the testimony from employees of Royal Park Motel, LP, that they had to consult with Diane Wang or Gerald Wang for any major operational tasks create a triable issue of fact regarding whether the Wangs, in their individual capacities, held themselves to be capable of binding Royal Park Motel, LP, to others. (See Opposition Exs. F, W-Z, KK).

[3]Further, and in any event, the court finds that Plaintiffs have easily created a triable issue of fact on this issue, including that DC Wang, Inc. was not capitalized, that DC Wang did not make a capital contribution to Royal Park Motel, LP, that DC Wang, as general partner, was not paid by Royal Park Motel, LP, that DC Wang and the Wangs share the same address, that Gerald Wang did not know the purpose of DC Wang, DC Wang was a mere shell or instrumentality established only on paper as the 1% general partner, while the Wangs actively owned, managed, and controlled the property, going well beyond their role as limited partners in Royal Park Motel, LP, etc. (See, e.g., Opp. Exs. A, B, & F). To use the Defendants’ own terminology, there is no evidence of either “sweat,” or “equity” on the part of DC Wang, Inc. as the managing general partner of the partnership.

Case Number: BC688129    Hearing Date: January 21, 2021    Dept: 73

1/21/2021

Dept. 73

Rafael Ongkeko, Judge presiding

MARCOS DE LA TOBA, et al. v. ROYAL PARK MOTEL, LP, et al. (BC688129)

Counsel for Plaintiffs/opposing parties: Sean Novak, Farbod Youmtobian (The Novak Law Firm, PC)

Counsel for Defendants/moving parties: William Slaughter, Jonathan Marshall, Elizabeth Southerland (Slaughter, Reagan & Cole)

MOTION FOR LEAVE TO CONDUCT A MENTAL EXAMINATION (filed 12/10/2020)

TENTATIVE RULING

Plaintiffs have put their mental states at issue; have alleged past, present, and ongoing severe emotional distress beyond “garden-variety” emotional distress attributable to defendants; and have refused to agree to reasonable conditions for their mental examinations without court intervention. There is sufficient good cause. Plaintiffs’ privacy concerns are outweighed here by the claims they make for non-economic damages resulting from severe emotional distress. The motion is granted.

The court has reviewed the latest proposed order and is inclined to order those terms and conditions noted, with the limitations that only one psychological test each be conducted from among the various choices within each of the three subject matter areas and the removal of the SCID-5 structured decision-tree diagnostic interview for which no good cause has been shown.

Additional proposed conditions may also be argued at the hearing.

Discussion

A. Procedural Requirements for Mental Examination

(a) If any party desires to obtain discovery by . . . a mental examination, the party shall obtain leave of court. 

(b) A motion for an examination under subdivision (a) shall specify the time, place, manner, conditions, scope, and nature of the examination, as well as the identity and the specialty, if any, of the person or persons who will perform the examination. The motion shall be accompanied by a meet and confer declaration under Section 2016.040. 

(c) Notice of the motion shall be served on the person to be examined and on all parties who have appeared in the action. 

(Cal. Civ. Proc. Code § 2032.310). “The court shall grant a motion for a physical or mental examination under Section 2032.310 only for good cause shown.” (Cal. Civ. Proc. Code, § 2032.320.)  A motion for a mental examination must specify “the time, place, manner, conditions, scope, and nature of the examination, as well as the identity and the specialty, if any, of the person or persons who will perform the examination.” (Cal. Civ. Proc. Code § 2032.310, subd. (b).)

B. Two-Part Substantive Test for Mental Examination

In controversy.” The determination of good cause requires the court to, first, determine whether or not a party has put their mental state in “controversy” and, second, perform a balancing act between the rights to discovery and a party’s privacy concerns. (Vinson v. Superior Court (1987) 43 Cal. 3d 833, 840 (Vinson).) The moving party must produce specific facts justifying the discovery and narrowly tailor the scope of the examination. Id. Mere speculation and/or a general fishing expedition is not allowed. (Id.)

Plaintiffs do not seriously dispute that they have placed their mental states “in controversy.” The Plaintiffs have alleged a cause of action for intentional infliction of emotional distress and have alleged that they have suffered severe and serious emotional and physical injuries as a result of Defendants’ conduct, including sleeplessness, humiliation, grief, anxiety, mental anguish, frustration, anxiety, and severe mental and emotional stress. (FAC, ¶¶ 12, 68, 139). In discovery, Plaintiffs have also identified depression and memory loss as further mental conditions that they suffered due to Defendants’ conduct. Like Vinson, “[i]n the case at bar, plaintiff haled defendants into court and accused them of causing her various mental and emotional ailments.” (Vinson, supra, at 839-40). “[B]y asserting a causal link between [their] mental distress and defendants' conduct, plaintiff[s] implicitly claim[] it was not caused by a preexisting mental condition, thereby raising the question of alternative sources for the distress.” (Id.) Contrary to Plaintiffs’ contention, this is not garden variety “emotional distress,” but allegations of serious and severe mental conditions that were caused by Defendants’ conduct. Plaintiffs, therefore, have put their mental state in controversy.

Balancing of Privacy Interests.” “Determining that the mental or physical condition of a party is in controversy is but the first step in our analysis.” (Vinson, supra, at 840). “In contrast to more pedestrian discovery procedures, a mental or physical examination requires the discovering party to obtain a court order.” (Id.) “The requirement of a court order following a showing of good cause is doubtless designed to protect an examinee's privacy interest by preventing an examination from becoming an annoying fishing expedition.” (Id.) “While a plaintiff may place his mental state in controversy by a general allegation of severe emotional distress, the opposing party may not require him to undergo psychiatric testing solely on the basis of speculation that something of interest may surface.” (Id.)

The court finds that Defendants’ psychologist’s declarations have provided a sufficient showing of the appropriate topics for the clinical interview and the types of psychological testing that will be conducted. There is no evidence of intrusiveness into extremely sensitive and highly private areas of any plaintiff’s personal lives. The court limits the testing to three tests, one for each subject matter area noted and, further, denies the request to conduct a “structured decision-tree diagnostic interview (SCID-5)” due to the absence of any evidence showing a standard need to do so in conducting a comprehensive psychological examination.

Notice of ruling by moving party.

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