Judge Bruce G. Iwasaki

Department 58

Hearing Date: March 25, 2024

Case Name: Flores v. Great Supplies & Services, Inc.

Case No.: 20STCV21895

Matter: Motion to Amend Judgment

Moving Party: Plaintiff/Judgment Creditor Fernando Flores

Responding Party: None

Tentative Ruling: The Motion to Amend the Judgment is granted.

This action arises from consumer protection violations. The Complaint, filed on June 10, 2020, alleges Defendant Great Supplies & Services, Inc. (GSS), which was doing business as a used-car dealership under the fictitious business name Ayla Motors, committed numerous violations of California consumer-protection laws in selling the subject 2016 Ford Mustang (Vehicle) to Plaintiff Fernando Flores in October 2019.

Thereafter, Defendant GSS moved to compel arbitration. On January 12, 2021, the Court granted the motion.

In October 2022, the arbitrator issued an interim award including monetary relief in favor of Plaintiff and against Defendant GSS; in December 2022, the arbitrator issued a final award that included prejudgment interest and attorneys’ fees. The following month, Plaintiff filed a petition to confirm the arbitration award, which GSS did not oppose. The Court entered judgment on February 15, 2023.

Plaintiff/Judgment Creditor now moves to amend the judgment pursuant to Code of Civil Procedure section 187. No opposition was filed.

The motion is granted.

Discussion

Plaintiff moves to amend the judgment adding Mehdi Omrani (Omrani), Kaladar Co., Inc. (Kaladar), and Luxury Auto Sales, Inc. (Luxury Auto) as additional judgment debtors based on the fact they are alter egos of Judgment Debtor GSS. Judgment Debtor also seeks to amend the judgment to include an order enabling Judgment Creditor to dispose of the Vehicle.

Code of Civil Procedure section 187 provides that once a court has jurisdiction over a party, it may employ “all the means necessary to carry [its jurisdiction] into effect.” (Code Civ. Proc., § 187.) “This includes the authority to amend a judgment to add an alter ego of an original judgment debtor, and thereby make the additional judgment debtor liable on the judgment. [Citation.] Amending a judgment to add an alter ego of an original judgment debtor ‘ “is an equitable procedure based on the theory that the court is not amending the judgment to add a new defendant but is merely inserting the correct name of the real defendant.” ’ ” (Highland Springs Conference & Training Center v. City of Banning (2016) 244 Cal.App.4th 267, 280; NEC Electronics Inc. v. Hurt (1989) 208 Cal.App.3d 772, 778-779.)

To prevail on a motion to amend a judgment to change a judgment debtor's name, the moving party must show that the party to be added was in fact an original defendant in the action. (Burlingame v. Justice's Court (1934) 1 Cal.2d 71, 72–73.) In addition, the moving party must have acted with due diligence in seeking to amend the judgment. (Alexander v. Abbey of the Chimes (1980) 104 Cal.App.3d 39, 48.) The moving party has the burden of proving the facts essential to the granting of the motion by a preponderance of the evidence. (Wollersheim v. Church of Scientology (1999) 69 Cal.App.4th 1012, 1017.) The “decision to grant an amendment lies in the sound discretion of the trial court. [Citation.]” (Relentless Air Racing, LLC v. Airborne Turbine Ltd. Partnership (2013) 222 Cal.App.4th 811, 815.)

Here, Judgment Creditor submits adequate evidence of the alter ego relationship between GSS and the proposed judgment debtors.

“Before the alter ego doctrine will be invoked in California, two conditions generally must be met. [¶] ‘First, there must be such a unity of interest and ownership between the corporation and its equitable owner that the separate personalities of the corporation and the shareholder do not in reality exist. Second, there must be an inequitable result if the acts in question are treated as those of the corporation alone.’ [Citation.] While courts have developed a list of factors that may be analyzed in making these determinations, ‘[t]here is no litmus test to determine when the corporate veil will be pierced; rather the result will depend on the circumstances of each particular case.’ ” (Curci Investments, LLC v. Baldwin (2017) 14 Cal.App.5th 214, 221; see Mesler v. Bragg Management Co. (1985) 39 Cal.3d 290, 300; Sonora Diamond Corp. v. Superior Court (2000) 83 Cal.App.4th 523, 538.)

In general, the conditions in which a court may disregard the structure of a limited liability company and consider it the alter ego of a member “necessarily vary according to the circumstances in each case inasmuch as the [alter ego] doctrine is essentially an equitable one and for that reason is particularly within the province of the trial court.” (Zoran Corp. v. Chen (2010) 185 Cal. App. 4th 799, 811.)

Here, Plaintiff submits evidence that Mehdi Omrani is the owner, officer, or director of Judgment Debtor GSS, Kaladar, and Luxury Auto; further the parties have the same counsel and do business on each other’s lot. (Cook Decl., ¶¶ 3, 45, Exs., 2, 10, 20.) Specifically, the evidence shows Omrani was the sole owner, officer, and director of Kaladar. (Cook Decl., ¶ 45; COE, Ex. 20.) Further, Kaladar listed Brian D. McMahon as its registered agent for service of process—the same attorney who represented Judgment Debtor GSS at the arbitration hearing. (Cook Decl., ¶¶ 3, 45, Ex. 20.) Additionally, Omrani was listed on the Secretary of State filings for Luxury Auto in April 2023 and sat for his deposition at Luxury Auto for his remote deposition in September 2022. (Cook Decl., ¶ 22, Ex. 5, at 8:5-13 [showing Omrani was located at 10423 Hawthorne Boulevard in Inglewood], Ex. 18 [showing Luxury Auto was issued dealer license for that location in February 2022].)

Additionally, although not named in the action, Omrani, Kaladar, and Luxury Auto participated in and controlled the underlying litigation and arbitration against GSS. Judgment Creditor argues that this is most evident in the fact that Luxury Auto took over GSS’ (doing business as Ayla Motors) location; now, even though it has no sales lot, Ayla Motors is still advertising vehicles for sale at that location, and Kaladar dba Cal Auto Net has a sign identifying itself as “LUXURY AUTO SALES DISPLAY AREA.” (Cook Decl., ¶¶ 25, 34, 43, Ex. 13, at 3, Ex. 19, at 1, 4, Ex. 7, at 4-5, Ex. 8, at 2.) Further, in March 2018, Kaladar obtained a dealer license for Cal Auto Net to operate at 10401 Hawthorne. (Cook Decl., ¶ 29, Ex. 10.) In February 2019, GSS obtained a dealer license for Ayla Motors to operate at 10504 Hawthorne. (Cook Decl., ¶ 30, Ex. 11.) This location was across the street and one block south from Cal Auto Net. (Cook Decl., ¶ 24, Ex. 7, at 1, 3.) The foregoing evidence (and other evidence) suggests that Judgment Debtor GSS dba Ayla Motors and Kaladar, and Luxury Auto Sales were all operating on each other properties treating their respective properties as their own for business purposes. (Cook Decl., ¶¶ 20-34, 43, 45, 51.)

Additionally, Judgment Creditor has satisfied the requirement that injustice will result if the Court fails to disregard GSS’s corporate entity. Specifically, five days before the Court confirmed the arbitration award and entered judgment, Judgment Debtor GSS dissolved itself. (Cook Decl., ¶¶ 11-12, 47, Ex. 22.) Judgment Creditor persuasively argues that this action has hindered his ability to recover on the Judgment, resulting in an injustice.

Lastly, Judgment Creditor requests the Judgment be amended to allow him to dispose of the Vehicle.

As noted above, Code of Civil Procedure section 187 “grants to every court the power to use all necessary means to carry its jurisdiction into effect, even if those means are not specifically pointed out in the code.” (Alexander v. Abbey of the Chimes (1980) 104 Cal.App.3d 39, 44 [italics added].)

Here, the current Judgment is for rescission, which requires Judgment Debtor GSS to pay off the balance owed on the Vehicle and to reimburse Judgment Creditor for his payments in exchange for Judgment Creditor’ transfer of the vehicle to Judgment Debtor GSS. (Cook Decl., ¶ 10, Ex. 1, at 1:26-2:2 [Judgment].) The Judgment explicitly states, “Plaintiff shall surrender the Vehicle and transfer his interest therein to GSS.” (Id., at 2:2.) However, as a result of GSS’ actions to dissolve itself, GSS has frustrated Judgment Creditor’s attempts to obtain satisfaction on the Judgment. Judgment Creditor argues the amended judgment request will allow Judgment Creditor to dispose of the Vehicle to pay off the balance on the Judgment himself.

Based on the foregoing, Plaintiff has met its burden on this motion.

Conclusion

The motion to amend the judgment is granted.