Judge: Mark A. Young, Case: 23SMCV05806, Date: 2024-04-19 Tentative Ruling

Case Number: 23SMCV05806    Hearing Date: April 26, 2024    Dept: M

CASE NAME:           Cienega Ventures LLC v. 730 N. La Cienega LLC, et al.

CASE NO.:                23SMCV05806

MOTION:                  Motion for Stay of Proceedings

HEARING DATE:   4/26/2024

Legal Standard

“Trial courts generally have the inherent power to stay proceedings in the interests of justice and to promote judicial efficiency.” (Freiberg v. City of Mission Viejo (1995) 33 Cal. App. 4th 1484, 1489.) The trial court has the authority to control litigation before it in order to ensure the orderly administration of justice. (Code Civ. Proc., §§ 128, 187; Rutherford v. Owens-Illinois, Inc. (1997) 16 Cal.4th 953, 967 [“It is also well established that courts have fundamental inherent equity, supervisory, and administrative powers, as well as inherent power to control litigation before them.”].)

Analysis

Defendants 730 N. La Cienega, LLC, Koi LP, Nick Haque, 734 LCB, LLC, and Koi Group, Inc. move to stay this fraudulent transfer action pending the resolution of the earlier-filed rent recovery action, Cienega Ventures, LLC v. 730 N. La Cienega, LLC, et al., LASC Case No. 22SMCV000063. Defendant argues that the fraudulent transfer action should be stayed for efficiency’s sake in favor of first resolving the related rent action. Defendant reasons that this fraudulent transfer action is contingent on the success of the rent action, since the debt alleged in this matter is the based upon the underlying rent claim, and thus the outcome of the rent action will moot this transfer action. Defendant sets forth several scenarios of how the rent action will be dispositive of this matter, including where there is a judgment in Defendants’ favor, a nominal judgment in Plaintiff’s favor, a ready collection of any judgment in Plaintiff’s favor, or the settlement of both actions.

Defendants’ cited authorities do not support a stay. Generally, courts approve discretionary stays where the moving party shows some sort of substantial prejudice absent the stay. (See Montrose Chem. Corp. v. Superior Court, (1993) 6 Cal. 4th 287 [a stay of the declaratory relief action pending resolution of the third-party suit is appropriate when the insurance coverage question turns on facts to be litigated in the underlying action and to eliminate the risk of inconsistent factual determinations that could prejudice the insured]; St. Paul Fire & Marine Insurance Co. v. AmerisourceBergen Corp., (2022) 80 Cal. App. 5th 1 [trial court had discretion to stay California state action filed by insurer against insureds on a forum-non-conveniens basis, where insurer was already a defendant in a four year long complex litigation in West Virginia state court regarding prescription opioid lawsuits around the country, where there was overlapping discovery, both cases presented substantially identical coverage and policy language issues, and the WV court already issued rulings on such issues]; Haskel, Inc. v. Superior Court, (1995) 33 Cal. App.4th 963, 978–80 [insured was entitled to stay of discovery in declaratory relief action, pending a factual determination by the trial court as to whether any pending discovery by the insurers is so logically related to the issues in the underlying action that further pursuit of that discovery would prejudice insured’s interests in that action].)

Here, however, there is no substantial prejudice in proceeding with both actions simultaneously other than the costs and time involved in litigating two cases. While the Court has discretion to order a stay, the Court is not persuaded that a stay would be in the interests of justice or promote efficiency. Defendants fail to explain how concurrently litigating this action would substantially prejudice them. Defendant presents only the possibility that this instant fraudulent transfer action will become moot, either because of a defense-favorable judgment in the rent action or a global settlement of both actions. Furthermore, even if this fraudulent transfer action largely depends on the validity of the rent action, there is still no apparent risk of factually inconsistent rulings even if the cases are never consolidated. Therefore, the Court declines to issue a stay.

Accordingly, the motion is DENIED.