Judge Holly J. Fujie, Case Number: 21STCV12338, Date: 2024-06-11 Tentative Ruling

On October 26, 2021, Plaintiff Jason Sydney (“Plaintiff”) filed the operative First Amended Complaint (“FAC”) against Defendants Humboldt Brand Cannabis Company, Inc.; HB Business Solutions, Inc.; Reuven Sherr; Yvonne Sherr; Ronald Sherr; Nicholas Pirrung; and DOES 1-100 (“Defendants”), inclusive, alleging 15 causes of action for Fraud, Breach of contract, California Labor Code Violations, Unlawful Business Practices – Cal. Bus. & Prof. Code § 17200, Declaratory Judgment, Intentional Interference with Contractual Relations, and Intentional Interference with Prospective economic Relations.

On July 28, 2023, Plaintiff and Defendants filed a Stipulation Re Voluntary Dismissal With Retention of Jurisdiction Under Cal. Code of Civil Procedure Section 664.6. Subsequently, this action was dismissed with prejudice on August 2, 2023.

On May 17, 2024, Plaintiff filed the instant Motion to Enforce Settlement Agreement. A timely opposition would have been filed on or before May 29, 2024; none has been filed.

Pursuant the Code of Civil Procedure Section 664.6: “If parties to pending litigation stipulate, in a writing signed by the parties outside the presence of the court or orally before the court, for settlement of the case, or part thereof, the court, upon motion, may enter judgment pursuant to the terms of the settlement. If requested by the parties, the court may retain jurisdiction over the parties to enforce the settlement until performance in full of the terms of the settlement.”

“Because of its summary nature, strict compliance with the requirements of section 664.6 is prerequisite to invoking the power of the court to impose a settlement agreement.” (Sully-Miller Contracting Co. v. Gledson/Cashman Construction, Inc. (2002) 103 Cal.App.4th 30, 37;Critzer v. Enos (2010) 187 Cal.App.4th 1242, 1262.) In ruling on a motion under § 664.6, the trial judge may receive oral testimony, or may determine the motion upon declarations alone. (Corkland v. Boscoe (1984) 156 Cal.App.3d 989, 994.) Where the agreement was reached at a court hearing, the court can resolve the dispute on the basis of its own notes or recollection of what was agreed to (as well as any transcripts of the proceedings). (Richardson v. Richardson (1986) 180 Cal.App.3d 91, 97.)

Plaintiff moves for an order enforcing a valid, written Confidential Settlement Agreement and Mutual General Release (the “Settlement Agreement”) on July 9, 2023.

Generally, courts lose subject matter jurisdiction when an action is voluntarily dismissed. (Hagan Engineering, Inc. v. Mills (2003) 115 Cal.App.4th 1004, 1009.) Code of Civil Procedure Section 664.6 provides the authority for the Court the retention of personal jurisdiction to enforce the settlement “if requested by the parties.” The stipulation as to jurisdiction must conform to the same requirements necessary for enforcement of the settlement agreement. (Wackeen v. Malis (2002) 97 Cal.App.4th 429, 440.) It is not enough simply to provide for a retention of jurisdiction in the settlement agreement. (Mesa RHF Partners, L.P. v. City of Los Angeles (2019) 33 Cal.App.5th 913, 918.) Instead, the request to retain jurisdiction must be filed with the court: “the parties could have easily invoked section 664.6 by filing a stipulation and proposed order either attaching a copy of the settlement agreement and requesting that the trial court retain jurisdiction under section 664.6 or a stipulation and proposed order signed by the parties noting the settlement and requesting that the trial court retain jurisdiction under section 664.6. The process need not be complex. But strict compliance demands that the process be followed.” (Ibid.; see Sayta v. Chu (2017) 17 Cal.App.5th 960, 966-968 [no subject matter jurisdiction to enforce settlement per CCP § 664.6 because parties failed to ask court to retain jurisdiction before case dismissed.)

Here, Plaintiff and Defendants entered into the Settlement Agreement, which required Defendants to pay Plaintiff a sum of $150,000.00 payable in two installments, in exchange for the release of all claims by Plaintiff against Defendants. ((Rome Decl., ¶3, Ex. A.) The first payment of $50,000.00 was to be paid within two days of receiving an Employee Retention Tax Credit or by January 7, 2024. (Id.) The second payment of $100,000.00 was to be paid within two days of receipt of any tax refund other than the Employee Retention Tax Credit or by July 7, 2024. (Id., ¶4.) The Settlement Agreement also provides for attorneys’ fees and costs incurred in connection with the enforcement of its terms. (Id., ¶9, Ex. A.)

Pursuant to Section 4 of the Settlement Agreement, Plaintiff and Defendants expressly agreed that this Court would retain jurisdiction to enforce its terms, as follows: “The Parties agree that the Court will retain jurisdiction to enforce this Agreement pursuant to Civil Procedure Code section 664.6 or by any other procedure permitted by law in the appliable court.” (Id., ¶3, Ex. A.) The Settlement Agreement was signed by all the parties. (Rome Decl., ¶6.) Plaintiff’s Request for Dismissal form also requested the Court to retain jurisdiction pursuant to Code of Civil Procedure Section 664.6. (Request for Dismissal entered 8/2/23.)

Defendants have failed to make any of the payments as required under the Settlement Agreement. (Id., ¶5.) Plaintiff has sent multiple emails to Defendants requesting the required payments. (Id., ¶¶7-8, Exs. B-C.) Enforcement of the Settlement Agreement is warranted under Code of Civil Procedure Section 664.6.

Therefore, the motion to enforce settlement agreement is GRANTED in the amount of $150,000.00 plus $5,250.00 in attorney’s fees and costs.

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.

Hon. Holly J. Fujie

Judge of the Superior Court