Judge: H. Jay Ford, III, Case: 23SMCV03260, Date: 2024-04-09 Tentative Ruling

Case Number: 23SMCV03260    Hearing Date: April 9, 2024    Dept: O

Case Name:  BSI Group LLC, et al. v. Samoska

SUBJECT:                 MOTION TO DISMISS FOR FAILURE TO JOIN INDISPENSABLE PARTIES

MOVING PARTY:   Defendant William Samoska

RESP. PARTY:         Plaintiffs BSI Group, LLC And International Business Solutions Group LLC

TENTATIVE RULING

            Defendant William Samoska’s Motion to Dismiss for Failure to Join Indispensable Parties is DENIED. EZBanc is not an indispensable party in the instant suit and Defendant has an adequate remedy in filing a cross-complaint against alleged joint tortfeasor EZBanc.

            Defendant William Samoska’s RJN is GRANTED.

I.      Failure to Joint Indispensable Party Pursuant to CCP § 389

            Within CCP § 389(a)’s first clause, or the “complete relief” clause, the statute “focuses not on whether complete relief can be afforded all possible parties to the action, but on whether complete relief can be afforded the parties named in the action.” (Deltakeeper v. Oakdale Irrigation Dist. (2001) 94 Cal.App.4th 1092, 1101; Code Civ. Proc. § 389, subd. (a).) As to CCP § 389(a)’s second clause regarding potential impairment to an absent party’s ability to protect a claimed interest, it has been held that to the extent that the absent party and existing defendants share goals with respect to the outcome of the litigation, it is unlikely for the absent party’s interests to be impeded or impaired. (See Countrywide Home Loans, Inc., supra, 69 Cal.App.4th at p. 796; see also Citizens Ass’n for Sensible Dev. of Bishop Area v. Cnty. of Inyo (1985) 172 Cal.App.3d 151, 161.) Regarding CCP § 389(a)’s multiple recovery and inconsistent obligations clause “[a] ‘substantial risk’ [of multiple recovery] means more than a theoretical possibility of the absent party’s asserting a claim that would result in multiple liability.” (Union Carbide Corp. v. Superior Court (1984) 36 Cal.3d 15, 21.) “[I]nconsistent obligations occur when a party is unable to comply with one court’s order without breaching anther court’s order concerning the same incident.” (Van Zant v. Apple Inc. (2014) 229 Cal.App.4th 965, 977, internal quotations omitted.)

            Furthermore, “[i]t has long been the rule that it is not necessary for all joint tortfeasors to be named as defendants in a single lawsuit.” (Countrywide Home Loans, Inc. v. Superior Court (1999) 69 Cal.App.4th 785, 796; See Am. Motorcycle Ass’n v. Superior Court (1978) 20 Cal.3d 578, 607 [“a defendant is generally authorized to file a cross-complaint against a concurrent tortfeasor for partial indemnity … even when such concurrent tortfeasor has not been named a defendant in the original complaint”].)

            Following the initial determination under CCP § 389(a), “[i]f a person who qualifies as a necessary party ‘cannot be made a party’ to the action, the court must determine under [Code of Civil Procedure section 389] subdivision (b) whether ‘in equity and good conscience the action should proceed among the parties before it, or should be dismissed without prejudice, the absent person being thus regarded as indispensable.’” (Doe v. Regents of the University of Cal. (2022) 80 Cal.App.5th 282, 301 (quoting Code Civ. Proc. § 389, subd. (b).) That is, a party may be deemed “indispensable” or “necessary” under subdivision (a), but that finding will not automatically result in dismissal should the Court determine otherwise under subdivision (b). (See Deltakeeper, supra, 94 Cal.App.4th at p.1106; Code Civ. Proc. § 389, subd. (a)-(b).)

            It has been held that the statute governing joinder of indispensable parties “does not now provide, and never has provided, that the absence of an indispensable party deprives a court of subject matter jurisdiction. Rather, the decision whether to proceed with the action in the absence of a particular party is one within the court’s discretion, as governed by the various factors enumerated in subdivision (b) of section 389, Code of Civil Procedure.” (Sierra Club, Inc. v. Cal. Coastal Comm. (1979) 95 Cal.App.3d 495, 500.) Those factors include: “(1) to what extent a judgment rendered in the person’s absence might be prejudicial to him or those already parties; (2) the extent to which, by protective provisions in the judgment, by the shaping of relief, or other measures, the prejudice can be lessened or avoided; (3) whether a judgment rendered in the person’s absence will be adequate; (4) whether the plaintiff or cross-complainant will have an adequate remedy if the action is dismissed for nonjoinder.” (Code Civ. Proc. § 389, subd. (b).) “It is for reasons of equity and convenience, and not because it is without power to proceed, that the court should not proceed with a case where it determines that an ‘indispensable’ party is absent and cannot be joined.” (Tracy Press, Inc. v. Superior Court (2008) 164 Cal.App.4th 1290, 1300, internal quotations omitted.)

            The claims within BSI Group LLC v. EZBanc, et al., Case No.: 3:23-CV-00127-BSM (E.D. Ark. 2023) (RJN, Ex. A.) and the instant case are not substantially similar as both claims deal with different alleged unauthorized transfers of monies between different Defendants or sets of Defendants. Here, the alleged unauthorized transfers of money concerns two 2-21-23 wire transfers of funds directly from Plaintiffs’ BSI Group, LLC And International Business Solutions Group LLC (“Plaintiffs”) bank accounts to Defendant William Samoska’s (“Samoska”) client trust account. (FAC, ¶¶ 44, 45.) In the Federal case the alleged unauthorized transfers of money concerned wire transfers in December 2022 and January 2023. (See RJN, Ex. A ¶¶ 45–125.)  The instant case focuses solely on the act of Samoska and his acceptance of the alleged unauthorized transferred funds; thus Samoska will receive complete relief. (See Deltakeeper, supra, 94 Cal.App.4^th at p. 1101; see also Countrywide Home Loans, Inc., supra, 69 Cal.App.4th at p. 793–794.)

            Samoska is afforded the opportunity to file a cross-complaint against any joint tortfeasors that could be party to this action including EZBanc, thus there will be no prejudice to Samoska through not dismissing this case. (See Countrywide Home Loans, Inc., supra, 69 Cal.App.4th at p. 796.)

            Plaintiffs argue they have no other adequate remedy against Samoska if the instant case is dismissed because the Federal action concerns entirely distinct alleged unauthorized transactions to which Samoska would likely argue he is not involved in, and if joined under the Federal further, Samoska would likely contest jurisdiction if named in Arkansas. (Oppo, p. 17.) The Court finds these assumptions reasonable and agrees that Plaintiff could have no other adequate remedy against Samoska if the instant case is dismissed.

            Thus, The Court will not exercise its discretion to dismiss the case over failure to join a necessary party to the action.

II.             Motion to Stay Pending the Outcome of the Federal Action

            “It is black letter law that, when a Federal action has been filed covering the same subject matter as is involved in a California action, the California court has the discretion but not the obligation to stay the state court action.” (Caiafa Prof. Law Corp. v. State Farm Fire & Cas. Co. (1993) 15 Cal.App.4th 800, 804.)

            No stay is warranted because the two cases at issue do not concern the same subject matter as argued by Samoska, and as analyzed above. Both cases involve different sets of transactions and different receiving parties. The Court will not use its discretion to stay the action pending the outcome of the federal action.