Judge: David A. Hoffer, Case: 30-2021-01227845, Date: 2023-07-31 Tentative Ruling

Cross-Defendants Mokhtar Ramadan, Fadi Ramadan, and Marwan Ramadan’s Motion for Bifurcation of Cross-Complainant Peter Gorla’s Alter Ego Claims from Liability Claims, filed on 3/6/23, is GRANTED.

CCP § 598 provides, in part: “The court may, when the convenience of witnesses, the ends of justice, or the economy and efficiency of handling the litigation would be promoted thereby, on motion of a party, after notice and hearing, make an order…that the trial of any issue or any part thereof shall precede the trial of any other issue or any part thereof in the case.”  The statute thus permits bifurcation when the convenience of witnesses, the ends of justice, or the economy and efficiency of handling the litigation would be promoted thereby.

In determining whether bifurcation or severance is appropriate, courts often look to other factors aside from whether the case presents separate issues. For example, courts will consider the complexity of the issues, the risk of jury confusion, judicial economy, and whether the claims present separate and independent issues. (Downey Sav. & Loan Ass'n v. Ohio Cas. Ins. Co (1987) 189 Cal.App.3d 1072, 1086).

Here, moving Cross-Defendants seek to bifurcate the issue of alter ego theory from the issue of corporate liability of Plaintiff/Cross-Defendant Hospitality Marketing Concepts, LLC (“HMC”). Cross-Defendants assert that bifurcation would promote judicial economy, efficiency and avoid jury confusion as the evidence on alter ego theory requires analysis of corporate formation and finances that would not need to be examined if no corporate liability is found.  Most importantly, moving Cross-Defendants point out that the alter ego issue is equitable and tried to the court whereas the corporate liability issue is legal and tried to a jury.

In this case, the court exercises its discretion to bifurcate the legal issue from the equitable one.  There is simply no reason for a jury to hear evidence that will not be relevant to any questions on the verdict form and no reason for the court to hear evidence on alter ego if there is no corporate liability.  To the extent that the evidence partially overlaps, this evidence will be heard in the liability phase and will not need to be repeated in the alter ego phase.  In the court’s view, this is the most efficient way to handle a hybrid (part legal and part equitable) case such as this one.

Although the court could, as defendant seems to suggest, rule on this issue on the eve of trial (as part of a motion in limine), the court can also rule at this time.  Since the moving parties have brought the matter before the court at this time, the court will rule and grants the motion to bifurcate the corporate liability and alter ego issues.  Any further case management issues should be taken up before trial begins.

Defendants are ordered to give notice of this ruling.