Judge Elaine Lu, Case Number: 19STCV07425, Date: 2023-11-08 Tentative Ruling

On March 4, 2019, Plaintiff 147-151 W. 25^th St., LLC filed the action numbered 19STCV07425 (“Lead Action”). On December 16, 2019, 147-151 W. 25^th St., LLC filed the operative First Amended Complaint against Chang Lee, CJWorld-LA and GRG Collective, LLC^{^[1]} asserting causes of action for (1) Breach of Written Contract, (2) Vandalism,[2] [Violation of Penal Code § 594], (3) Intentional Misrepresentation, and (4) Declaratory Relief.

On October 31, 2019, Plaintiffs CJWorld-LA, Chang Lee, and Eric Lee (collectively “CJWorld Parties” or “Tenants”) initiated the 19STCV39298 action (“Related Action”). On January 29, 2021, CJWorld Parties filed the operative Third Amended Complaint asserting claims against Defendants 25^th St. LLC, Babak Aframian, and Avi Aframian (collectively, for purposes of this motion, “Defendants” or “Landlords”), as well as Downtown Natural Caregivers, Inc., Lex W. Yoo[3]; Christopher James Giordano; Yun T. Kang; Charles Dunn Company, Inc.; William Christopher Steck; and Brent Yoonmoo Koo. The Third Amended Complaint in the Related Action asserted thirteen causes of action for: (1) Fraud; (2) Negligence; (3) Breach of Written Contract; (4) Breach of the Covenant of Good Faith and Fair Dealing; (5) Breach of the Covenant of Quiet Enjoyment; (6) Wrongful Eviction; (7) Trespass to Chattels; (8) Intentional Interference with Contractual Relations; (9) Intentional Interference with Prospective Economic Relations; (10) Specific Performance; (11) Violation of the Unfair Competition Law; (12) Unjust Enrichment; and (13) Return of Security Deposit.[4]

On October 9, 2020, the Court sustained cross-defendants DNC and Kang’s demurrer to the second, eighth, ninth, tenth, and eleventh causes of action of the Landlords’ cross-complaint. In doing so, the Court granted leave to amend as to the second and eleventh causes of action. (Order 10/9/20.)

On October 14, 2020, 147-151 W. 25^th St., LLC, Babak Aframian, and Avi Aframian filed the operative First Amended Cross-Complaint (“FACC”) asserting the same causes of action^{^[5]} for (1) breach of written contract, (2) intentional misrepresentation, (3) fraud in the inducement, (4) professional negligence, (5) breach of fiduciary duty, (6) violation of Civil Code § 2079.16 et seq., (7) breach of covenant of good faith and fair dealing, (8) implied indemnity, (9) comparative indemnity, (10) equitable indemnity, and (11) declaratory relief. Only the first, second, and eleventh causes of action were asserted against cross-defendants DNC and Kang. On April 7, 2021, the Court sustained DNC and Kang’s demurrer to the second cause of action without leave to amend. (Order 4/7/21.)

On December 4, 2019, the Court deemed the cases related and designated 19STCV07425 to serve as the lead action. (Minute Order 12/4/19.) On June 1, 2021, the Lead Action and Related Action were consolidated for all purposes. (Order 6/1/21.) On June 2, 2022, Plaintiff 147-151 W. 25^th St., LLC, Babak Aframian, and Avi Aframian dismissed Defendants Christopher James Giordano, Charles Dunn Company, Inc., and William Christopher Steck from their complaint in the Lead Action. On June 2, 2022, Cross-Complainants Christopher James Giordano, Charles Dunn Company, Inc., and William Christopher Steck dismissed their cross-complaint filed on December 2, 2020. On June 2, 2022, CJWorld Parties dismissed Christopher James Giordano from their complaint in the related action. On June 3, 2022, CJWorld Parties dismissed Brent Koo from their complaint in the related action.

On November 28-30, 2022, December 5-8, 2022, and December 12-14, 2022, the Lead and Related Actions came on for two phases of a consolidated jury trial. On the breach of contract claim of Landlords’ First Amended Complaint, the jury found in favor of Landlord 147-151 W. 25^th St LLC and against Tenants and awarded $17,500 of unpaid rent for September 2019 bur declined to award any clean up costs or repairs/reconstructions/renovation/

remedial work for damages sustained at the subject property. On Tenants’ Third Amended Complaint, the jury found in favor of CJWorld-LA and Chang Lee and against 147-151 W. 25^th St LLC and Avi Aframian as to Tenants’ claims for concealment, intentional misrepresentation, breach of written contract, breach of implied covenant of good faith and fair dealing, breach of implied covenant of quiet enjoyment, and wrongful eviction, and the jury awarded $20,250 for lost plants and $337,609 for lost profits, and $30,000 for emotional distress on Chang Lee’s wrongful eviction claim, but the jury declined to award any amount for additional rent at the Tenants’ new warehouse or for the security deposit. The jury also found in favor of Eric Lee and against 147-151 W. 25^th St LLC, Avi Aframian, and Babak Aframian as to Eric Lee’s claim for trespass to chattels, but the jury declined to award any amount for Eric Lee’s emotional distress resulting from the trespass to chattels. The jury made findings of oppression, fraud, or malice, thereby necessitating a second phase of trial on punitive damages. At the conclusion of phase 2, the jury declined to award any amount of punitive damages against Landlords.

Following the jury trial, the Court held an uncontested prove up hearing regarding 25^th Street LLC’s claims against DNC and Kang on December 14, 2022. On December 14-15, 2022, the Court held an uncontested prove up hearing regarding CJWorld and Chang Lee claims against DNC and Kang.

On February 14, 2023, after an offset, the Court entered judgment on the Third Amended Complaint in the Related Action in favor of Plaintiff CJWorld-LA against Defendants 147-151 W. 25^th St., LLC and Avi Aframian, jointly and severally, in the sum of $340,359.00 and in favor of Plaintiff Chang Lee, jointly and severally in the amount of $370,359.00 against Defendants 147-151 W. 25^th St., LLC and Avi Aframian. As to the Third Amended Complaint in the Related Action, the Court entered judgment in favor Plaintiffs CJ-World LA and Chang Lee and against Defendants Downtown Natural Caregivers, Inc. and Yun T. Kang, jointly and severally in the sum of $357.859.00. As to the First-Amended Cross-Complaint in the Related Action, the Court entered judgment in favor of 25th St LLC against Cross-Defendants DNC and Kang jointly and severally for a total judgment of $958,725.62.

On February 28, 2023, CJWorld-LA and Chang Lee (jointly “Tenants”) filed a memorandum of costs. On March 20, 2023, 147-151 W. 25^th St., LLC (“Landlord”) filed a motion to tax costs. On October 26, 2023, Tenants filed an opposition. On November 1, 2023, Landlord filed declarations in support of the reply, but no reply was timely filed.

“A prevailing party is entitled ‘as a matter of right’ to recover costs in any action or proceeding unless a statute expressly provides otherwise.” (Segal v. ASICS America Corp. (2022) 12 Cal.5th 651, 658.) “Section 1033.5 sets forth the types of expenses that are and are not allowable as costs under section 1032. Specifically, subdivision (a) of section 1033.5 describes items that are ‘allowable as costs,’ subdivision (b) describes items ‘not allowable as costs, except when expressly authorized by law,’ and section 1033.5(c)(4) provides that ‘[i]tems not mentioned in this section and items assessed upon application may be allowed or denied in the court's discretion.’” (Ibid.)

For a cost to be recoverable, it must be reasonably necessary to the litigation and reasonable in amount. (Perko’s Enterprises, Inc. v. RRNS Enterprises (l992) 4 Cal.App.4th 238, 244.) If the items appearing in a cost bill appear to be proper charges, the burden is on the party seeking to tax costs to show that they were not reasonable or necessary. (Ladas v. California State Automotive Assoc. (1993) 19 Cal.App.4th 761, 773-74.) On the other hand, if the items are properly objected to, they are put in issue, and the burden of proof is on the party claiming them as costs. (Id.)

California Rule of Court, Rule 3.1700 requires that “[a]ny notice of motion to strike or to tax costs must be served and filed 15 days after service of the cost memorandum. If the cost memorandum was served by mail, the period is extended” by up to 20 days. (Cal. Rules of Court, Rule 3.1700(b)(1).) Additionally, “[T]he court may extend the times for serving and filing the cost memorandum or the notice of motion or tax costs for a period not to exceed 30 days.” (Cal. Rules of Court, Rule 3.1700(b)(3).)

California Rule of Court, Rule 3.1700 requires that “[a]ny notice of motion to strike or to tax costs must be served and filed 15 days after service of the cost memorandum. If the cost memorandum was served by mail, the period is extended as provided in Code of Civil Procedure section 1013. If the cost memorandum was served electronically, the period is extended as provided in Code of Civil Procedure section 1010.6(a)(4).” (Cal. Rules of Court, Rule 3.1700(b)(1).) Additionally, “the court may extend the times for serving and filing the cost memorandum or the notice of motion or tax costs for a period not to exceed 30 days.” (Cal. Rules of Court, Rule 3.1700(b)(3).)

Here, Tenants served the memorandum of costs electronically on February 28, 2023. Accordingly, Landlord had until March 17, 2023 to file a timely motion to tax. Landlord did not file the instant motion until March 20, 2023, which is untimely. However, the accompanying declaration of Danny Tamayo notes that the delay in filing was due to an error with the electronic filer. (Tamayo Decl. ¶¶ 2-4.) Moreover, the proof of service denotes that Landlord timely served Tenants with the instant motion on March 15, 2023. Accordingly, the Court will extend the time by three days for filing of the instant motion, and the Court will consider the untimely filing on the merits.

Landlord contends that the entire memorandum of costs should be stricken as Tenants are not the prevailing party. The Court disagrees.

“Code of Civil Procedure section 1032, subdivision (a)(4) defines the ‘prevailing party\’ in litigation to include ‘the party with a net monetary recovery’[.]” (DeSaulles v. Community Hospital of Monterey Peninsula (2016) 62 Cal.4th 1140, 1144.) “A ‘prevailing party,’ so defined, ‘is entitled as a matter of right to recover costs in any action or proceeding.’ (§ 1032, subd. (b).)” (DeSaulles, supra, 62 Cal.4th at p.1144.)

As noted in the procedural history above, on February 14, 2023, after an offset, the Court entered judgment on the Third Amended Complaint in the Related Action in favor of Plaintiff CJWorld-LA against Defendants 147-151 W. 25^th St., LLC and Avi Aframian, jointly and severally, in the sum of $340,359.00 and in favor of Plaintiff Chang Lee, jointly and severally in the amount of $370,359.00 against Defendants 147-151 W. 25^th St., LLC and Avi Aframian. Thus, Tenants have obtained a net monetary recovery, making them the prevailing party. Tenants are entitled to costs as a matter of right.

Landlord contends that the costs should be apportioned because the instant action involved numerous different parties. However, the Court lacks authority to apportion such costs.

“Apportionment of costs is authorized, at the court's discretion, only under those comparatively unusual circumstances when the court must determine which party prevailed. (Code Civ. Proc., § 1032, subd. (a)(4).)” (Smock v. State of California (2006) 138 Cal.App.4th 883, 889.) Here, Tenants clearly prevailed, and as such, a determination of apportionment is unnecessary and improper. Moreover, Landlord fails to cite any statutory authority permitting such apportionment. “[T]he prevailing party is entitled to all of his costs unless another statute provides otherwise. [Citation.] Absent such statutory authority, the court has no discretion to deny costs to the prevailing party.” (Nelson v. Anderson (1999) 72 Cal.App.4th 111, 129.)

“If items on a memorandum of costs appear to be proper charges on their face, those items are prima facie evidence that the costs, expenses, and services are proper and necessarily incurred. [Citation.] The burden then shifts to the objecting party to show them to be unnecessary or unreasonable.” (Doe v. Los Angeles County Dept. of Children & Family Services (2019) 37 Cal.App.5th 675, 693.) “[T]he objecting party has the burden to show that a cost item is unrecoverable because it was not necessary to the litigation.” (Hooked Media Group, Inc. v. Apple Inc. (2020) 55 Cal.App.5th 323, 338.) “It is not necessary that the [moving party], …, accompany the motion to tax cost with any affidavit.” (State of California v. Meyer (1985) 174 Cal.App.3d 1061, 1075.) However, more than a bare objection is needed to rebut the presumption that fees were reasonable and necessarily incurred.” (State of California, supra, 174 Cal.App.3d at p.1075.)

Landlord contends that the (1) filing fees, (2) deposition costs, (3) service of process fees, (4) court reporter fees, (5) interpreter fees, and (6) other fees should be taxed.

Filing fees, deposition costs, service of process, and court reporter fees are expressly permitted as costs. (CCP § 1033.5(a)(1), (3)-(4), (11).) Thus, the burden falls on Landlord to show that these claimed costs are unreasonable. Landlord fails to do so and merely argues that some of the fees were incurred against other parties. However, as noted above, apportionment is not authorized, and Tenants are entitled to all costs reasonably incurred. Moreover, the interpreter fees were incurred as deposition costs and thus are expressly permitted by statute. (CCP § 1033.5(a)(3)(B).)

As to some of the filing fees, such as the deposition subpoena costs and filing fees opposing the motion to quash, the Court agrees that the costs are unreasonable as they were improperly incurred and resulted in sanctions against Tenants. (Masjedi Decl. ¶ 15.) Accordingly, Landlords motion to tax is granted as to the filing costs for $305.45.

Based on the foregoing, 147-151 W. 25^th St., LLC’s motion to tax is GRANTED IN PART as to $305.45 in filing fees and otherwise DENIED.

[1] On July 13, 2020, 147-151 W. 25^th St., LLC dismissed GRG Collective, LLC.

[2] On July 23, 2020, the Court sustained Chang Lee and Eric Lee’s demurrer to the vandalism cause of action without leave to amend. (Lead Action Order 7/23/20.)

[3] On February 10, 2021, the CJWorld Parties dismissed Lex Yoo from the action without prejudice.

[4] On June 17, 2022, the CJWorld Parties dismissed the tenth cause of action for specific performance.

[5] Cross-Defendants DNC and Kang are no longer alleged as part of the eighth, ninth, and tenth causes of action.

Superior Court of California

County of Los Angeles

Department 26