Judge: Donald F. Gaffney, Case: Owens v. Tillman, Date: 2022-10-19 Tentative Ruling

TENTATIVE RULING:

A.   Motion to Deem Requests for Admission Admitted

Plaintiff moves for an order that the Requests for Admission, Set One, served on Defendant Zeeshawn Zia be deemed admitted.  For the reasons set forth below, the motion is GRANTED.

Where a party fails to timely respond to a request for admission, the propounding party may move for an order that the genuineness of any documents and the truth of any matters specified in the requests be deemed admitted.  (Code Civ. Proc., § 2033.280(b).)  The party who failed to respond waives any objections to the demand, unless the court grants them relief from the waiver, upon a showing that the party (1) has subsequently served a substantially compliant response, and (2) that the party’s failure to respond was the result of mistake, inadvertence, or excusable neglect.  (Code Civ. Proc., § 2033.280 (a)(1)-(2).)  

Plaintiff served the requests for admission at issue by personal service on October 15, 2021—over one year ago.  Defendant Zia still has not responded to those requests and has not filed an opposition to this motion either showing (1) he has since served a substantially compliant response or (2) any failure to respond was a result of mistake, inadvertence, or excusable neglect.  The motion is, therefore, GRANTED.

Plaintiff to give notice.

B.   Motion for Summary Judgment

Plaintiff moves for an order granting summary judgment against Defendants Dustin Tilman and Zeshawn Zia.  For the reasons set forth below, the motion is GRANTED.

1. Legal Standard

Under Code of Civil Procedure § 437c(c), a summary judgment motion shall be granted if all the papers submitted show there is no triable issue as to any material fact and the moving party is entitled to judgment as a matter of law. 

A “party moving for summary judgment bears an initial burden of production to make a prima facie showing of the nonexistence of any triable issue of material fact . . . .” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850.) “A prima facie showing is one that is sufficient to support the position of the party in question.” (Id. at 851.)  A plaintiff moving for summary judgment satisfies his or her initial burden by showing that each element of the cause of action in question has been “proved,” and hence that there is no defense thereto. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850.)

If the moving party does not meet this initial burden, there is no need to oppose the motion and the motion must be denied.  (Binder v. Aetna Life Ins. Co. (1999) 75 Cal.App.4th 832, 840.) 

However, when the moving party has met its initial burden and an unopposed summary judgment motion establishes the absence of triable issues of fact, a trial court may grant the motion. (Tire Distributors, Inc. v. Cobrae (2005) 132 Cal.App.4th 538, 543.)

2. Analysis

“Tortious interference with contractual relations requires ‘(1) the existence of a valid contract between the plaintiff and a third party; (2) the defendant's knowledge of that contract; (3) the defendant's intentional acts designed to induce a breach or disruption of the contractual relationship; (4) actual breach or disruption of the contractual relationship; and (5) resulting damage.’” (Pech v. Doniger, 75 Cal. App. 5th 443, 457 (2022) citing Ixchel Pharma, LLC v. Biogen, Inc., 9 Cal.5th 1130, 1141 (2020).)

“Because interference with an existing contract receives greater solicitude than does interference with prospective economic advantage [citation], it is not necessary that the defendant's conduct be wrongful apart from the interference with the contract itself.” (Quelimane Co. v. Stewart Title Guaranty Co. (1998) 19 Cal.4th 26, 55.) “[I]t is necessary to distinguish the tort of interference with an existing contract because the exchange of promises which cements an economic relationship as a contract is worthy of protection from a stranger to the contract.” (Ibid.) “Intentionally inducing or causing a breach of an existing contract is therefore a wrong in and of itself.” (Id. at pp. 55-56.) “Because this formal economic relationship does not exist and damages are speculative when remedies are sought for interference in what is only prospective economic advantage, [California Courts have] concluded that some wrongfulness apart from the impact of the defendant's conduct on that prospect should be required.” (Id. at p. 56.) “Implicit in [that] holding is a conclusion that this additional aspect of wrongfulness is not an element of the tort of intentional interference with an existing contract.” (Ibid.)

“Moreover, the tort of intentional interference with performance of a contract does not require that the actor's primary purpose be disruption of the contract.” (Ibid.) “It applies also to intentional interference…in which the actor does not act for the purpose of interfering with the contract or desire it but knows that the interference is certain or substantially certain to occur as a result of his action.” (Ibid.)

Under these standards, considering Plaintiff’s moving evidence and the deemed admitted requests for admission, the court finds that Plaintiff has offered sufficient evidence to meet its initial burden to establish a prima facie case for tortious interference with a contractual relationship:

• Element 1—Existence of a Valid Contract between Plaintiff and a Third Party:  In August 2018, Wein made an offer to buy Plaintiff’s common voting shares in EAG at ten (10) cents per share. (Separate Statement of Undisputed Material Facts (“SUMF”) No. 16; Mvg. Owens Decl., ¶ 14.) Owens accepted that offer. (Ibid.)  In September 2018, Plaintiff, Plaintiff’s holding company RMMH, LLC, and Non-Party Wein prepared a written contract under which Wein agreed to purchase sixty-two million, eighty-two thousand shares of Plaintiff’s common voting stock in EAG at ten (10) cents per share. [SUMF Nos. 18-19; Mvg. Owens Decl., ¶ 15.)

Performance of that contract would have resulted in payment to Plaintiff in the amount of $6,208,000.  (Ibid.)

• Element 2—Defendant’s Knowledge of That Contract:  Wein had informed Defendants of the agreement to confirm Plaintiff’s ownership in the EAG shares and Defendants had knowledge of the agreement between Plaintiff and Wien. [SUMF Nos. 20-22, Mvg. Owens Decl., ¶¶ 16-17, RFA No. 16, 22 (deemed admitted).]

• Element 3—Defendant’s Intentional Acts Designed to Induce a Breach of Disruption of the Contractual Relationship:  After learning about the agreement between Plaintiff and Wein, Defendants intended to interfere with that contract by making false representations to Wein that Plaintiff’s stock was not transferrable, that Plaintiff’s stock could be recalled, by imposing impossible conditions on Plaintiff’s selling the stock to Wein, and by telling Wein that Owens was a “fraud.”  [SUMF Nos. 23, 24, 25, 27, 28 and  RFA Nos. 17-27 (deem admitted).]

• Element 4—Actual Breach or Disruption of the Contractual Relationship: As a result of Defendants’ conduct, the agreement between Plaintiff and Wein was disrupted and never performed.  [Mvg. Owens Decl., ¶ 23.]

• Element 5—Resulting Damage:  Had the agreement between Plaintiff and Wein been performed, Plaintiff would have received $6,208,000.  [SUMF No. 19; Mvg. Owens Decl., ¶ 23.] However, due to Defendants’ interference, Plaintiff had to sell his stock to Defendants for $3,208,000.  [SUMF No. 32, Mvg. Owens Decl., ¶ 26, RFA No. 29 (deem admitted).]  However, Defendants defaulted on this agreement and never paid him.  [SUMF No. 33, Mvg. Owens Decl., ¶ 26, RFA No. 30 (deem admitted).  As such, Plaintiff has suffered damages equal to the purchase price between Plaintiff and Wein--$6,208,000.  [SUMF No. 19; Mvg. Owens Decl., ¶ 23.]

While the court finds that Plaintiff has met its initial burden of establishing damages, the court finds that Plaintiff has not offered sufficient evidence to meet its initial burden for punitive damages.  “[A]n award of punitive damages hinges on three factors: the reprehensibility of the defendant's conduct; the reasonableness of the relationship between the award and the plaintiff's harm; and, in view of the defendant's financial condition, the amount necessary to punish him or her and discourage future wrongful conduct. . . .” (Baxter v. Peterson (2007) 150 Cal.App.4th 673, 680). Accordingly, “an award of punitive damages cannot be sustained on appeal unless the trial record contains meaningful evidence of the defendant's financial condition.”  (Ibid.) There is no meaningful evidence of defendant’s financial condition in the record.

As Plaintiff has met his initial burden to establish his prima facie case, the burden then shifts to Defendants to offer sufficient evidence to create a triable issue of fact.  Defendants, however, have failed to file an opposition and/or any objections to the evidence submitted by Plaintiff.  As such, any evidentiary objections to Plaintiff’s evidence have been waived and Plaintiff’s evidence is deemed undisputed.  Accordingly, Defendants have failed to meet their burden and no triable issue of fact exists.

The motion is, therefore, GRANTED and Plaintiff is entitled to summary judgment in the amount of $6,208,000 against Defendants. 

Plaintiffs to give notice and lodge a proposed judgment within 10 court days.