Judge: David Sotelo, Case: 21STCV37449, Date: 2022-08-29 Tentative Ruling
Case Number: 21STCV37449 Hearing Date: August 29, 2022 Dept: 40
MOVING PARTY: Defendants Chen Wei,
Liu Quing and Yong Dong, Inc.
Plaintiffs Hong Du and Stylish Hardwood, Inc. filed this
action against Defendants Chen Wei, Liu Quing, and Yong Dong, Inc. and alleging
two causes of action: vacatur of this Court’s entry of Default Judgment against
Du and Stylish in a completely different lawsuit (LASC Action No. BC626381) on
the grounds of lack of jurisdiction, and vacatur of the same Default Judgment
based on due process grounds.
Defendants Chen Wei, Liu Quing, and Yong Dong, Inc. now
bring an unopposed Motion to Dismiss this entire action on Res Judicata
grounds, i.e., Du and Stylish raised the issues in this lawsuit in an October
18, 2021 Motion in the BC626381 Action, which the Court denied on February 16,
2022 and for which reason the issues raised in this lawsuit are barred/estopped.
The Court agrees with the Defendants Wei, Quing, and Yong
Dong’s position and thus GRANTS the Motion to Dismiss.
Per the Defendants Wei, Quing, and Yong Dong’s request, the
Court TAKES NOTICE of the Complaint in this action and the Motion to Set Aside
Default Judgment (Cross-Complaint) and February 16, 2022 Minute Order in LASC
Action No. BC626381. (See Mot., RJN, p. 2; see also Evid. Code., §§ 452, subd.
(d), 453.)
Underlying Action (BC626381)
In relevant part, on August 29, 2016, the Defendants in this
action (Wei, Quing, Yong Dong) filed a Cross-Complaint against Du, Stylish, and
Tie Jun Zhou in LASC Action No. BC626381
(the “Underlying Action”). (The sole plaintiff in the Underlying Action was Tie
Jun Zhou.) Service for the Underlying Action Cross-Complaint was effected on Du
and Stylish on September 28, 2016, and due to nonresponse, the Defendants in
this action (Wei, Quing, Yong Dong) filed and obtained entry of default against
Du and Stylish on January 11, 2017.
On March 29, 2019—during which time Du and Stylish failed to
participate in the Underlying Action—the plaintiff/cross-complainant in the
Underlying Action (Zhou) filed a Request for Dismissal for the “[e]ntire action
of all parties and all causes of action,” which this Court entered on April 12,
2019 and interpreted as dismissing the Underlying Action’s Complaint by Zhou
and Cross-Complaint by Wei, Quing, Yong Dong.
On April 26, 2019, Zhou, Wei, Quing, and Yong Dong jointly
stipulated to vacating the April 12, 2019 Dismissal as to cross-complainants Du
and Stylish on the grounds that Zhou, Wei, Quing, and Yong Dong had not
intended to dismiss Du and Stylish from the Underlying Action. The Court
granted this Stipulation on May 17, 2019.
On January 9, 2020, Wei, Quing, and Yong Dong obtained
Default Judgment in the Underlying Action against Du and Stylish.
On January 19, 2021, Du moved to Set Aside Default Judgment
on the grounds of mistake, inadvertence, surprise, or excusable neglect—i.e.,
lack of notice as to the Cross-Complaint—which this Court denied on April 30, 2021,
finding that the record showed substituted service on Du and factors indicating
his knowledge of the Underlying Action’s pendency.
On October 18, 2021, Du again moved to set aside the Default
Judgment, but on new grounds: generally (1) this Court lacked jurisdiction to
enter the April 26, 2019 Stipulation by Zhou, Wei, Quing, and Yong Dong in lieu
of the April 12, 2019 dismissal of the cross actions; and (2) the April 26,
2019 Stipulation by Zhou, Wei, Quing, and Yong Dong was not noticed and served on
Du or Stylish, and because the Stipulation affected Du and Stylish’s dismissal
from the Underlying Action, a lack of notice as to that hearing affected their
due process rights.
Present Action (21STCV37449): Also on October 8, 2021, Du and Stylish brought
this action alleging two causes of action “in equity” against Wei, Quing and
Yong Dong: (1) Independent Action in Equity to Set Aside and Vacate Judgment for
Lack of Personal Jurisdiction; and (2) Independent Action in Equity to Set
Aside and Vacate Judgment Due to Extrinsic Fraud, Mistake, or Accident, i.e.,
lack of notice of the Stipulation to Du and Stylish.
Related Cases:
On January 26, 2022, Wei, Quing, and Yong Dong filed a Notice of Related
Case in the Underlying Action seeking to relate that case (BC626381) to the
present action (21STCV37449), which this Court granted on January 31, 2022.
On February 16, 2022, after consideration of the parties’
substantive arguments, this Court denied the October 18, 2021 Motion to Set
Aside Default Judgment (Cross-Complaint) in the Underlying Action, rejecting
the grounds advanced by Du and Stylish on motion.
On June 20, 2022, Wei, Quing, and Yong Dong brought the Motion
to Dismiss now before this Court, seeking to dismiss the present action
(21STCV37449) on the grounds that this Court’s rulings in the Underlying
BC626381 Action function as res judicata over the claims advanced in the
21STCV37449 Complaint. (Du and Stylish have altogether failed to oppose the
Motion to Dismiss.)
Most recently, on July 19, 2022, the Court held an Order to
Show Cause hearing regarding Dismissal of this action, which neither Plaintiffs
Du and Stylish nor Defendants Wei, Quing, and Yong Dong attended. Based on this
nonappearance, the Court continued the OSC re Dismissal to August 29, 2022,
i.e., the same date for on which the Motion to Dismiss before the Court was to
be heard. The Court also noted that “Plaintiff[s’] failure to appear at the
next court hearing [on August 29, 2022] [would] be deemed consent to dismissal
of the complaint” in this action.
Legal Standard: A party may raise the defense of res
judicata or claim preclusion on a motion to dismiss supported by affidavits. (Best
v. Fitzgerald (1947) 81 Cal.App.2d 965, 967; see also Planning &
Conservation League v. Castaic Lake Water Agency (2009) 180 Cal.App.4th
210, 232.)
Code of Civil Procedure, section 1908, subdivision (a)
codifies the res judicata and claim preclusion doctrine and provides that “[a]
judgment or final order in an action or special proceeding” is conclusive
between the parties and their successors in interests as to “the matter
directly adjudicated.” (See also Needelman v. DeWolf Realty Co., Inc.
(2015) 239 Cal.App.4th 750, 757.) “Res judicata, or claim preclusion, prevents
relitigation of the same cause of action in a second suit between the same
parties or parties in privity with them.” (Needelman, at p. 757
[citations omitted].) This principle is codified in Code of Civil Procedure,
section 1908, subdivision (a)(2), which states:
In … cases [not involving judgment or
order against a specific thing, or in respect to the probate of a will, or the
administration of the estate of a decedent, or in respect to the personal,
political, or legal condition or relation of a particular person], the judgment
or order is, in respect to the matter directly adjudged, conclusive between the
parties and their successors in interest by title subsequent to the
commencement of the action or special proceeding, litigating for the same thing
under the same title and in the same capacity, provided they have notice,
actual or constructive, of the pendency of the action or proceeding.
(Code Civ. Proc., § 1908, subd. (a)(2).) The burden of
proving that the requirements for application of res judicata (or claim
preclusion) have been met is upon the party seeking to assert it as a bar or
estoppel. (Vella v. Hudgins (1977) 20 Cal.3d 251, 257.)
Analysis: Wei, Quing, and Yong Dong argue on Motion
to Dismiss that res judicata bars this action because (1) this action raises
issues already decided by this Court when It denied Du and Stylish’s October
18, 2021 Motion to Set Aside Default Judgment (Cross-Complaint) in the
Underlying Action, (2) the ruling in the Underlying Action was on the merits, and
(3) Du and Stylish are the same parties tied to the Complaint in this action
and the denied October 18, 2021 motion. (Mot., 5:3-6:23.)
The Court agrees insofar as claim preclusion in contemplated
and GRANTS the Motion to Dismiss.
The October 18, 2021 Motion to Set Aside Default Judgment
(Cross-Complaint) made by Du and Stylish in the Underlying Action addressed two
general issues:
(1) Whether this Court had jurisdiction to enter the April 26, 2019 Stipulation
by Zhoi, Wei, Quing, and Yong Dong after the April 12, 2019 Dismissal of the
Complaint and Cross-Complaint in the Underlying Action; and
(2) Whether Du and Stylish’s due process rights were
violated when they allegedly failed receive notice of the April 26, 2019
Stipulation by Zhou, Wei, Quing, and Yong Dong, resulting in a deprivation of
due process rights when this Court entered the Stipulation and thus opened the
door for Wei, Quing, and Yong Dong to obtain Default Judgment against Du and
Stylish on the Underlying Action’s Cross Complaint.
(See BC626381, Oct. 18, 2021 Mot., 5:14-6:1 [jurisdiction
argument], 6:2-7:24 [due process concerns].)
The Complaint in this action (21STCV37449) alleges two
causes of action, which similarly address the questions of (1) whether this
Court had jurisdiction to enter the enter the April 26, 2019 Stipulation in the
Underlying Action (BC626381) and (2) whether Du and Stylish’s due process
rights were violated when Du and Stylish allegedly failed to receive notice of
the April 26, 2019 Stipulation, ultimately resulting in Default Judgment in the
Underlying Action. (21STCV37449 Complaint, ¶¶ 16-30 [jurisdiction], 31-40 [due
process concerns].)
These circumstances show that Du and Stylish’s Cross
Complaint in this action and their Motion to Set Aside Default Judgment
(Cross-Complaint) in the Underlying Action—made on October 18, 2021 and denied
by this Court on February 16, 2022—address (1) the same issues (jurisdiction
and due process concerns related to the Stipulation and Default Judgment in the
Underlying BC626381 Action), (2) which were actually litigated and resolved on
the merits (see BC626381 Feb. 16, 2022 Minute Order), (3) as between the same
parties or their successors in interest, i.e., Du and Stylish on the one end
and Wei, Quing, and Yong Dong on the other (compare BC626381 Feb. 16, 2022
Minute Order, with 21STCV37449 Complaint, First and Second Causes of Action).
THE COURT THUS GRANTS DEFENDANTS WEI, QUING, AND YONG DONG’S
MOTION TO DISMISS THE 21STCV37449 ACTION.
Defendants Chen Wei, Liu Quing and Yong Dong, Inc.’s Motion
to Dismiss – Res Judicata is GRANTED because the issues raised in the Complaint
for this action were previously raised by the same parties—Plaintiffs Du and
Stylish—actually litigated and resolved on the merits before this Court on
February 16, 2022, subjecting the Complaint in this action to dismissal on
claim preclusion grounds.