Judge: Jon R. Takasugi, Case: 22STCV25985, Date: 2024-05-31 Tentative Ruling

Case Number: 22STCV25985    Hearing Date: May 31, 2024    Dept: 17

Superior Court of California

County of Los Angeles

DEPARTMENT 17

TENTATIVE RULING

            Defendants’ demurrer is SUSTAINED, WITHOUT LEAVE TO AMEND.

On 10/24/2023, Plaintiffs James Davis, Paranotek, LLC, and Astra Veda Corporation (collectively, Plaintiffs) filed suit against Scott Eppinga, Bradley M. Listermann, Benjamin Eppinga, and Think Humble, Inc. On 4/24/2024, Plaintiffs filed a first amended complaint (FAC) alleging: (1) breach of fiduciary duties; (2) breach of the duty of good faith and fair dealing; (3) fraud; an d(4) unjust enrichment.

On 4/24/2024, Defendants Scott Eppinga, Benjamin Eppinga, and Think Humble, Inc. demurred to the FAC.

Discussion

            As a preliminary matter, “[e]xcept in a summary judgment or summary adjudication motion, no opening or responding memorandum may exceed 15 pages.” (CRC Rule 3.113.) Despite this, Defendants’ Memorandum of Points and Authorities is a total of 34 pages. Defendants are to abide by page limit, or the Court will disregard the portion of the motion that exceeds the page-limit. Given that Defendants’ argument section did not begin in this motion until page 19, the Court would ordinarily decline to consider Defendants’ argument.

            However, given Plaintiff’s lack of opposition, and given the nature of Defendants’ arguments, the Court makes an exception to consider the arguments advanced here.

            Defendants argue that Plaintiff’s claims are based on allegations which have already been considered, and rejected, by a Wyoming Court. As a result, Defendants’ argue the entire case is barred by issue preclusion/collateral estoppel:

Plaintiffs’ entire case—all four causes of action against all Eppinga Defendants—is based upon their allegations that the loans Scott Eppinga made to Astra Veda are fraudulent and that the Defendants “forged” documents to cover up these “bad” loans. However, the Wyoming court has held that these loans and documents are valid and enforceable.

            (Demurrer, 19: 7-9.)

“Res judicata applies if (1) the decision in the prior proceeding is final and on the merits; (2) the present proceeding is on the same cause of action as the prior proceeding; and (3) the parties in the present proceeding or parties in privity with them were parties to the prior proceeding.” (Fed'n of Hillside & Canyon Associations v. City of Los Angeles (2004) 126 Cal.App.4th 1180, 1202.) 

            Here, Defendants argue that the elements of issue preclusion are clearly met: (1) Plaintiffs were each named Defendants in the Wyoming Action; (2) the Wyoming court issued a final adjudication on the identical issue which is the heart of the present action, i.e., are the Loan and Stock Agreement, Resolution, and the underlying loans from Scott Epping to Astra Veda valid?

Defendants also submitted documentation to show that: (1) Plaintiffs admitted in the Wyoming Action that the Loan and Stock Agreement is valid (Exh. E, Defs’ W.R.C.P. 56.1(b) Statement, at ¶ 1.; (2) Plaintiffs admitted that the Astra Veda Board Resolution adopting the Loan and Stock Agreement is valid (Id. at ¶ 2.); (3) Plaintiffs also admitted that the underlying loans noted in the Loan Agreement are valid. (Id. at ¶¶ 4-5.). Based on these admissions, the Wyoming court found the Loan Agreement valid and enforceable against Astra Veda. (Exh. G.)

            Plaintiffs did not oppose this motion, and thus have not set forth any argument or legal authority which could rebut Defendants’ contention that their claim is barred by res judicata/collateral estoppel. The Court takes Plaintiffs’ non-opposition as a concession on the merits to Defendants’ claim. 

            Based on the foregoing, Defendants’ demurrer is sustained, without leave to amend.

It is so ordered.

Dated:  May    , 2024

   Hon. Jon R. Takasugi
   Judge of the Superior Court

Parties who intend to submit on this tentative must send an email to the court at smcdept17@lacourt.org by 4 p.m. the day prior as directed by the instructions provided on the court website at www.lacourt.org.  If a party submits on the tentative, the party’s email must include the case number and must identify the party submitting on the tentative.  If all parties to a motion submit, the court will adopt this tentative as the final order.  If the department does not receive an email indicating the parties are submitting on the tentative and there are no appearances at the hearing, the motion may be placed off calendar.  For more information, please contact the court clerk at (213) 633-0517.