Judge Holly J. Fujie, Case 20STCP04290 2022-09-27 Tentative Ruling

Judge: Holly J. Fujie, Case: 20STCP04290, Date: 2022-09-27 Tentative Ruling

DEPARTMENT 56 JUDGE HOLLY J. FUJIE, LAW AND MOTION RULINGS. The court makes every effort to post tentative rulings by 5.00 pm of the court day before the hearing. The tentative ruling will not become the final ruling until the hearing [see CRC 3.1308(a)(2)], and are also available in the courtroom on the day of the hearing [see CRC 3.1308(b)]. If the parties wish to submit on the tentative ruling and avoid a court appearance, all counsel must agree and choose which counsel will give notice. That counsel must 1) call Dept 56 by 8:30 a.m. on the day of the hearing (213/633-0656) and state that all parties will submit on the tentative ruling, and 2) serve notice of the ruling on all parties. If any party declines to submit on the tentative ruling, then no telephone call is necessary and all parties should appear at the hearing in person or by Court Call. Court reporters are not provided, and parties who want a record of motions and other proceedings must hire a privately retained certified court reporter.

Case Number: 20STCP04290 Hearing Date: September 27, 2022 Dept: 56

CASE NO.: 20STCP04290

[TENTATIVE] ORDER RE: DEMURRER/ MOTION TO STRIKE TO THIRD AMENDED COMPLAINT BY DEFNDANTS NTGS ACQUISITION, LLC; NEW TRADITION MEDIA, LLC; GAW CAPITAL ADVISORS, LLC; SPECTRUM FINANCIAL SERVICES, INC.; AND BRYAN MARTIN

Date: September 27, 2022
Time: 8:30 a.m.
Dept. 56

DAVID SEYDE,
Plaintiffs,
v.
SKYLINE OUTDOOR MEDIA LLC, et al.
Defendants.

MOVING PARTY: Defendants NTGS Acquisition, LLC; New Tradition Media, LLC; Gaw Capital Advisors, LLC; Spectrum Financial Services, Inc.; and Bryan Martin (“NTGS Defendants”)

RESPONDING PARTY: Plaintiff, David Seyde (“Plaintiff”)

The Court has considered the moving, opposition, and reply papers.

BACKGROUND

On December 31, 2020, Plaintiff filed this action. On August 10, 2021, Plaintiff filed a Second Amended Complaint (“SAC”), naming NTGS Defendants. NTGS Defendants filed a demurrer as to the SAC. In lieu of opposition to this demurrer, Plaintiff filed the operative Third Amended Complaint (“TAC”) on March 8, 2022. The TAC alleges, in relevant part, intentional interference with contract against Defendants. (TAC ¶¶ 138-147.)

Following meet and confer efforts, Defendants filed this Motion to Demurrer, concurrently with a Motion to Strike, on May 12, 2022. Defendants demur as to the intentional interference of contract cause of action on the grounds that it fails to state facts sufficient to state a claim and is uncertain.

On September 1, 2022, Plaintiff moved for leave to amend TAC and file Fourth Amended Complaint (“4AC”). NTGS Defendants objected to this motion.

Significantly, Plaintiff’s proposed 4AC eliminates all claims against New Tradition, GAW, Spectrum, and Bryan Martin. (See Wilson Decl. in Support of Motion, Ex. A.) The proposed 4AC also adds to the TAC’s intentional interference of contract cause of action that Defendants demur to. (See id. at Ex. A. ¶¶111-116.)

When a plaintiff files an amended complaint after a demurrer is filed, but before it is decided, the demurrer must be overruled as moot. (JKC3H8 v. Colton (2013) 221 Cal.App.4th 468, 477.) Because this Court has granted Plaintiff’s motion for leave to amend the TAC and file the 4AC, Defendant’s motion for demurrer and concurrent motion to strike as to the TAC is MOOT.

Moving Party is ordered to give notice of this ruling.

Parties who intend to submit on this tentative must send an email to the Court at SMC_DEPT56@lacourt.org as directed by the instructions provided on the court website at www.lacourt.org. If the department does not receive an email and there are no appearances at the hearing, the motion will be placed off calendar.

Dated on this 27th day of September 2022

___________________________

Hon. Holly J. Fujie

Judge of the Superior Court

[TENTATIVE] ORDER RE: MOTION FOR LEAVE TO AMEND THIRD AMENDED COMPLAINT AND FILE FOURTH AMENDED COMPLAINT

MOVING PARTY: Plaintiff, David Seyde

RESPONDING PARTY: Defendants NTGS Acquisition, LLC; New Tradition Media, LLC; Gaw Capital Advisors, LLC; Spectrum Financial Services, Inc.; and Bryan Martin (“NTGS Defendants”); Defendants Brian Kennedy; Regency Outdoor Advertising, Inc.; Skyline Outdoor Media, LLC; Corona Outdoor Advertising, Inc.; West Hollywood Properties, LLC; Westminster Outdoor, Inc.; and KBS Holdco, LLC (“Kennedy Defendants”).

The Court has considered the moving, opposition, and reply papers.

BACKGROUND

On December 31, 2020, Plaintiff filed this action. On August 10, 2021, Plaintiff filed a Second Amended Complaint (“SAC”). On March 8, 2022, Plaintiff filed the Third Amended

Complaint (“TAC”). NTGS Defendants filed a Motion to Demurrer and Motion to Strike as to the TAC. On September 1, 2022, Plaintiff moved for leave to amend TAC and file Fourth Amended Complaint (“4AC”.) Defendants have filed an opposition, and Plaintiff has filed a reply.

The Court notes that Plaintiff’s counsel circulated the proposed 4AC to all defendants and sought a stipulation to file the 4AC. (Wilson Decl. ¶ 26, Ex. U.)

DISCUSSION

“The court may, in its discretion and after notice to the adverse party, allow, upon any terms as may be just, an amendment to any pleading.” (Cal. Code Civ. Pro. § 473(a)(1).) As judicial policy favors resolution of all disputed matters between the parties, leave to amend is generally liberally granted. (Kolani v. Gluska (1998) 64 Cal.App.4th 402, 412.) The court may deny the plaintiff’s leave to amend if there is prejudice to the opposing party, such as delay in trial, loss of critical evidence, or added costs of preparation. (Id.)

Procedural Considerations

A motion to amend a pleading before trial must (1) include a copy of the proposed amendment or amended pleading, which must be serially numbered to differentiate it from previous pleadings or amendments; (2) state what allegations in the previous pleading are proposed to be deleted, if any, and where, by page, paragraph and line number, the deleted allegations are located; and (3) state what allegations are proposed to be added to the previous pleading, if any, and where, by page, paragraph, and line number, the additional allegations are located. (Cal. Rules of Court, rule 3.1324(a).) A separate supporting declaration must accompany this motion specifying (1) the effect of the amendment; (2) why the amendment is necessary and proper; (3) when the facts giving rise to the amended allegations were discovered; and (4) the reason why the request for amendment was not made earlier must accompany the motion. (Id., rule 3.1324(b).)

Plaintiff’s motion and accompanying declaration has met the requirements under California Rules of Court Rule 3.1324. Plaintiff’s declaration includes (1) a copy of the proposed amended complaint (Wilson Decl. Ex. A) and (2) a copy of redline comparing the differences between TAC and 4AC (Wilson Decl. Ex. B). In addition, Plaintiff’s declaration explains the effect of the amendment: “[t]he proposed 4AC adds and expands causes of action … increase efficiency and decrease motion practice because it eliminates numerous defendants, removes multiple causes of action, and moots several pending motions.” (Wilson Decl. ¶ 32.) Plaintiff’s counsel asserts that the proposed 4AC is “necessary and proper… to allow Plaintiff to assert meritorious causes of action against Defendants.” (Id.) Additionally, Plaintiff asserts that the Plaintiff did not seek proposed amendments earlier because Plaintiff’s counsel was substituted into the case in July and, after review of the case file, determined that a 4AC was necessary. (Id. at ¶ 33.)

Opposing Defendants assert that the motion is procedurally defective because Plaintiff does not “adequately outline when the…facts became known and why they are now being presented in a manner different from earlier versions,” (NTGS Opp. 7:3-14), and that Plaintiff “failed to explain what the ‘new facts’ even are, let alone when they were discovered.” (Kennedy

Opp. 9:15-27.) However, California Rules of Court Rule 3.1324 does not require this explanation of the new facts, only when they were discovered and why the amendment was not made earlier. Plaintiff meets this requirement by asserting that the facts were discovered in July when new counsel was substituted in and reviewed the case file.

Substantive Considerations

Motions for leave to amend will normally be granted, unless the party seeking to amend has been dilatory in bringing the proposed amendment before the court and the delay in seeking leave to amend will cause prejudice to the opposing party. (See Atkinson v. Elk Corp. (2003) 109 Cal.App.4th 739, 759-761.) Prejudice exists where the amendment would result in a delay of trial, along with loss of critical evidence, added costs of preparation, or increased burden of discovery. (Magpali v. Farmers Group, Inc. (1996) 48 Cal.App.4th 471, 486-488.)

Plaintiff asserts that the motion for leave to amend is timely because it will not cause a trial delay because no trial date has been set, no parties have filed an answer, only one defendant has just recently filed a cross-complaint, no party has produced discovery, and there are pending demurrers and motions to strike the TAC. (Motion 13:22-14:19; Reply 3:13-18.)

Defendants assert that the motion is untimely, and they will be prejudiced if Plaintiff was granted leave to amend. NTGS Defendants state that they are prejudiced because it has been 18 months and it is Plaintiff’s fifth amended complaint, forcing Defendants to incur hours of attorney time and fees. (NTGS Opp. 11:7-14.) Additionally, NTGS Defendants state that New Tradition, GAW, Spectrum, and Mr. Martin (members of NTGS Defendants) will be prejudiced because they will be dismissed without prejudice, allowing them to be haled into court later. (Id. at 11:15-19.)

Kennedy Defendants also assert that they will be prejudiced if Plaintiff is granted leave to amend because (1) Plaintiff’s new fraud cause of action is improper and previously dismissed, and (2) the First Cause of Action for Breach of Contract and Third Cause of Action for Breach of Fiduciary Duty interject new legal theories that the court has previously ruled on and will subject the 4AC to another anti-SLAPP motion. (Kennedy Opp. 10-13.)

Defendants’ facts are insufficient to show prejudice resulting from a delay in filing the 4AC. The fact that a pleading has already been amended “is not, by itself, sufficient grounds for denying further leave to amend.” (Douglas v. Superior Court (1989) 215 Cal. App. 3d 155, 158.) Additionally, the fact that the amendment involves a change in legal theory is not the kind of prejudice the court will consider. (Hirsa, supra, 118 Cal.App.3d at 490.) The Court also finds no prejudice resulting in defendants being eliminated from the 4AC, and Defendants cite to no case law to assert this position.

Further, leave to amend was not requested near trial because there is no trial date scheduled, and there are no assertions by defendants that the amendment will lead to increased burdens of discovery or a loss of evidence. Therefore, the Court finds Defendants will not be prejudiced if Plaintiff’s request for leave to amend is granted.

Plaintiff’s motion for leave to amend the TAC and file 4AC is GRANTED.

Moving Party is ordered to give notice of this ruling.

Dated on this 27th day of September 2022

___________________________

Hon. Holly J. Fujie

Judge of the Superior Court