Judge: Ashfaq G. Chowdhury, Case: 20GDCV00582, Date: 2025-02-26 Tentative Ruling
Case Number: 20GDCV00582 Hearing Date: February 26, 2025 Dept: E
Hearing Date: 02/26/2025 – 8:30am
Case No. 20GDCV00582
Trial Date: 04/07/2025
Case Name: KEN OKUYAMA DESIGN USA, INC. v. R MOTOR COMPANY, doing business as
DRAKO MOTORS and DRAKO MOTORS, INC.; and DOES 1-25
TENTATIVE
RULING ON DEFENDANT’S MOTION FOR SUMMARY JUDGMENT
RELIEF REQUESTED¿
“Defendant R Motor Company d/b/a
Drako Motors and Drako Motors, Inc. will move pursuant to Code of Civil
Procedure section 437c(a)(1) for an order granting summary judgment in favor of
Defendant on all claims.
The motion will be made on the
ground that California’s two-year statute of limitations for oral contracts
bars Plaintiff’s solitary claim. The motion will be based upon this notice and
the attached memorandum in support, and the records and files in this action,
and any further evidence and argument that the Court may receive at or before
the hearing.”
(Def. Mot. p.2.)
PRELIMINARY
Moving Party: Defendant, R Motor
Company d/b/a Drako Motors and Drako Motors, Inc. (Defendant or Movant or RMC)
Responding Party: Plaintiff, Ken
Okuyama Design USA, Inc. (Plaintiff or KOD)
Moving Papers: Notice/Motion;
Separate Statement; Declaration Kevin J. Terrazas; Declaration of Dean Drako;
Proposed Order
Opposing Papers: Plaintiff’s
Opposition; Plaintiff’s Compendium of Exhibits; Declaration of Kiyoyuku
Okuyama; Declaration of Robert W. Cohen;
Reply Papers: Reply; Defendant’s
Objections
PROCEDURAL ANALYSIS
Under CCP § 437c(a)(2):
Notice
of the motion and supporting papers shall be served on all other parties to the
action at least 81 days before the time appointed for hearing. If the notice is
served by mail, the required 81-day period of notice shall be increased by 5
days if the place of address is within the State of California, 10 days if the
place of address is outside the State of California but within the United
States, and 20 days if the place of address is outside the United States. If
the notice is served by facsimile transmission, express mail, or another method
of delivery providing for overnight delivery, the required 81-day period of
notice shall be increased by two court days.
(CCP § 437c(a)(2).)
Here, Defendant’s motions is timely.
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. (CCP § 437c(a)(3).)
Here, Defendant’s motion is timely.
LEGAL
STANDARD – MOTION FOR SUMMARY JUDGMENT
The
function of a motion for summary judgment or adjudication is to allow a
determination as to whether an opposing party cannot show evidentiary support
for a pleading or claim and to enable an order of summary dismissal without the
need for trial. (Aguilar v. Atlantic
Richfield Co. (2001) 25 Cal.4th 826, 843.) Code of Civil Procedure section
437c(c) “requires the trial judge to grant summary judgment if all the evidence
submitted, and ‘all inferences reasonably deducible from the evidence’ and
uncontradicted by other inferences or evidence, show that there is no triable
issue as to any material fact and that the moving party is entitled to judgment
as a matter of law.” (Adler v. Manor Healthcare Corp. (1992) 7
Cal.App.4th 1110, 1119.) “The function
of the pleadings in a motion for summary judgment is to delimit the scope of
the issues; the function of the affidavits or declarations is to disclose
whether there is any triable issue of fact within the issues delimited by the
pleadings.” (Juge v. County of Sacramento
(1993) 12 Cal.App.4th 59, 67, citing FPI
Development, Inc. v. Nakashima (1991) 231 Cal. App. 3d 367, 381-382.)
As to each claim as framed by the complaint, the
defendant moving for summary judgment must satisfy the initial burden of proof
by presenting facts to negate an essential element, or to establish a defense.
(CCP § 437c(p)(2); Scalf v. D. B. Log
Homes, Inc. (2005) 128 Cal.App.4th 1510, 1520.) The plaintiff or
cross-complainant shall not rely upon the 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 or a defense thereto. (CCP § 437c(p)(2).)
Courts “liberally construe the evidence in support of the party opposing
summary judgment and resolve doubts concerning the evidence in favor of that
party.” (Dore v. Arnold Worldwide, Inc. (2006) 39 Cal.4th 384, 389.)
“Once the
defendant or cross-defendant has met that burden, the burden shifts to the
plaintiff or cross-complainant to show that a triable issue of one or more
material facts exists as to the cause of action or a defense thereto. The
plaintiff or cross-complainant shall not rely upon the 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 or a defense thereto.” (CCP
§437c(p)(2).)
To establish a triable issue of material fact, the
party opposing the motion must produce substantial responsive evidence
sufficient to establish a triable issue of material fact on the merits of the
defendant’s showing. (Sangster v. Paetkau
(1998) 68 Cal.App.4th 151, 163.)
ANALYSIS
Plaintiff (KOD) filed the instant
action on 7/17/2020 against Defendant, R Motor Company, doing business as Drako
Motors and Drako Motors, Inc. (Defendant or RMC). Plaintiff’s Complaint alleges
one cause of action for breach of contract.
On 9/9/2022, this Court heard
Defendant’s motion for summary judgment. Defendant argued that summary judgment
should be granted in its favor because there is no written contract in the
instant action. Defendant also argued that at best, there is an oral agreement,
but if there is an oral contract, the cause of action for breach of contract is
barred by the two-year statute of limitations.
On 9/9/2022, this Court ruled, “Defendant’s
motion for summary judgment is GRANTED in favor of Defendant on all causes of
action in the complaint. Plaintiff failed to provide sufficient evidence that
raised a triable issue of fact as to the existence of a written contract.
Plaintiff provided evidence that could raise a triable issue of fact as to the
existence of an oral contract; however, any claim for breach of an oral
contract here would be barred by the statute of limitations.” (9/9/2022 Min.
Order, p. 6.)
On 1/11/2024, the remittitur from
the Court of Appeal was filed in this action.
The Court of Appeal disagreed with
this trial court and stated, “We conclude the purported written contract’s
terms were sufficiently definite to ascertain the parties’ obligations, and KOD
produced ample evidence to raise a triable issue of fact as to whether RMC
accepted the written agreement. We reverse.” (Remit. p. 2.)
In particular, the Court of Appeal
stated in relevant part, “Applying this standard to the December 2015 email, we
conclude the proposal was sufficiently definite that its acceptance, if proven,
would result in the formation of a written contract.” (Remit. p. 18.)
Further, the Court of Appeal stated:
As we have explained, the December 2015 email contained the
material terms necessary to determine whether the parties met their obligations
under Plan 2 of the purported written agreement. (See Moncada, supra,
221 Cal.App.4th at pp. 777–778.) And KOD’s evidence, although disputed, raised
a triable issue of fact as to whether RMC accepted the written proposal’s terms
orally or by other acts consistent with those terms. This is all that is
required for a contract to be “ ‘in writing’ for purposes of the statute of
limitations.” (Amen, supra, 58 Cal.2d at p. 532; Kovakovich, supra,
200 Cal.App.3d at p. 1201.)
(Remit. p. 25.)
Additionally, the Court of Appeal
stated:
Under Code of Civil Procedure section 337, subdivision (a),
an “action upon any contract, obligation or liability founded upon an
instrument in writing” must be brought within four years. The evidence shows
that, on September 1 and September 20, 2016, RMC failed to make payment “upon
receipt” of invoices for services rendered under Plan 2 of the December 2015
email. KOD filed this action on July 17, 2020—within four years of the alleged
breach. The trial court erred in concluding the action was time-barred.
(Remit. p. 25-26.)
Now, Defendant moves for summary
judgment again based on the argument that the agreement formed by the parties
was an oral contract, and the two-year statute of limitations applicable to
oral contracts applies in this case.
Defendant argues that new evidence
has arisen since the appellate court remanded this matter. Defendant agues that
in Plaintiff’s (Okuyama) deposition, which occurred after the appellate court’s
ruling, Plaintiff admitted multiple times, in various ways, that the agreement
between the parties was oral, and not written, as previously alleged.
The Court does not find Defendant’s
argument availing in light of the Court of Appeal’s ruling, or in light of the
additional evidence that Defendant presented.
As a preliminary matter, Defendant’s
motion is confusingly written, and it is oftentimes difficult for the Court to
understand the arguments that Defendant is trying to make.
Defendant points to random portions
of Plaintiff’s deposition transcript.
Defendant points to portions of the
deposition transcript while giving little to no context.
For example, Defendant points to
portions of the deposition transcript where Plaintiff stated, “We had an oral
agreement in each step that we both agreed so that process like this is typical
automotive R&D work.” (Def. Mot. p. 10.)
Defendant also points to portions of
the deposition transcript where Plaintiff stated, “No. There’s no written
contract in this project as you know.”
Problematic with the snippets of the
deposition transcript that Defendant presents is that the entire context is not
presented. Is Plaintiff suggesting that there is no written contract with
respect to the December 2015 email wherein the Court of Appeal found sufficiently
definite terms to ascertain the parties’ obligations? To this Court, it is
unclear.
It is unclear to this Court how
Defendant’s portrayal of Plaintiff’s deposition (that took place after the
Court of Appeal ruling) shows that there was only an oral contract.
Defendant’s argument seems to be
something along the lines of, “Since Plaintiff admitted it was an oral contract
and not a written contract, then as a matter of law the contract is an oral
contact.”
However, if Plaintiff had a similar argument,
would Defendant accept such an argument? Or to phrase it differently, if during
Plaintiff’s deposition, Plaintiff attested that the contract was written, would
Defendant agree that whatever Plaintiff says the contract is, then the contract
is in fact that at as a matter of law?
Never mind that it is unclear
whether the Court is bound to the characterization of the contract by the
deponent, who, as far as the Court is aware, in not a lawyer or familiar with
California law.
Surely, the law cannot be that if an
individual says a contract is oral or written in their deposition, then as a
matter of law, the contract is whatever the deponent claims it to be.
Even assuming that Plaintiff said
the things that Defendant alleges – i.e., Plaintiff “admitting” there’s no
written contract – it seems that, best-case scenario, Defendant would use this at
trial to argue that Plaintiff did not have a written contract.
Overall, the Court of Appeal
provided a thorough, well-reasoned explanation as to how it found that the
December 2015 email was sufficiently definite that its acceptance, if proven,
would result in the formation of a
written contract. Even if Plaintiff’s new deposition testimony stated there was
no written contract in this project, the Court is unclear as to how Plaintiff’s
opinion about whether or not the contract is oral or written is controlling
over the Court of Appeal’s findings. Based on the Court of Appeal’s findings,
and based on this new testimony by Plaintiff (although it is unclear to the
Court the context in which Plaintiff offered this testimony) that “There’s no
written contract in this project as you know,” at best it seems like the
evidence shows there would be a dispute as to whether or not there is a written
or oral contract.
As stated by the Court of Appeal:
“Where the meaning to be given a contract turns upon the
credibility of extrinsic evidence, the interpretation found by the trier of
fact is binding upon the reviewing court if there is substantial evidence to
support it. [Citations.] But the question whether the contract as interpreted
by the trier of fact is sufficiently definite and certain in its essential
terms to give rise to a legal obligation is a question of law. [Citation.] ‘. .
. On the other hand, where the existence and not the validity or construction
of a contract or the terms thereof is the point in issue, and the evidence is
conflicting or admits of more than one inference, it is for the jury or other
trier of the facts to determine whether the contract did in fact exist.’ ”
(Robinson & Wilson, Inc. v. Stone (1973) 35 Cal.App.3d 396, 407
(Robinson).)
(Remit. p. 10.)
TENTATIVE RULING MSJ
Defendant’s motion for summary
judgment is DENIED.
Defendant argued that the alleged
contract is an oral contract, and since the contract is an oral contract, this
case is barred by the two-year statute of limitations. Even though Defendant
submitted the deposition transcript of Plaintiff, it is still unclear how
Defendant established there is an oral contract in this case. Therefore, the
Court does not find that Defendant met its burden in establishing that the
instant contract in this matter is an oral contract, particularly in light of
the confusing manner that Defendant presented its argument with respect to the
evidence, and in light of the Court of Appeal’s thorough, well-reasoned ruling.
MOTION
FOR SANCTIONS PURSUANT TO CCP § 128.7
RELIEF REQUESTED¿
“Defendant
R Motor Company d/b/a Drako Motors and Drako Motors, Inc. will move pursuant to
Code of Civil Procedure § 128.7 for an order imposing sanctions.
The motion will be made on the
ground that Plaintiff has known since the start of this case that its claim was
barred by the applicable statute of limitations for an oral contract.
Specifically, as Plaintiff has testified numerous times, all of the agreements
at issue in this case were based on oral conversations and there was no writing
that identifies an agreement between the parties that actually came to pass—in
direct contradiction of Plaintiff’s pleadings. The motion will be based upon
this notice and the attached memorandum in support, and the records and files
in this action, and any further evidence and argument that the Court may
receive at or before the hearing.”
(Def. Mot. p. 2.)
PRELIMINARY
Moving Party: Defendant, R Motor
Company d/b/a Drako Motors and Drako Motors, Inc. (Defendant or Movant or RMC)
Responding Party: Plaintiff, Ken
Okuyama Design USA, Inc. (Plaintiff or KOD)
Moving Papers: Notice/Motion; Joshua
G. Simon Declaration; Declaration of Kevin J. Terrazas; Proposed Order
Opposing Papers: Opposition
Reply Papers: Reply
TENTATIVE RULING MOTION FOR
SANCTIONS
Defendant moves for sanctions in the
amount of $102,559.61. Defendant argues that sanctions are sought against
Plaintiff and its counsel because Plaintiff’s counsel presented allegations and
other factual and legal contentions to the Court that knowingly lacked
evidentiary support. Defendant argues that Plaintiff’s testimony directly
contradicts the Complaint’s allegations, which demonstrates that Plaintiff’s
breach of contract claim is frivolous.
Based on the Court’s denial of
Defendant’s motion for summary judgment, this Court also denies Defendant’s
motion for sanctions.