Judge: Mel Red Recana, Case: 20STCV45068, Date: 2024-11-12 Tentative Ruling
All rulings shown here are TENTATIVE ONLY, and thus oral argument WILL be heard. All Counsel are still required to attend.
Case Number: 20STCV45068 Hearing Date: November 12, 2024 Dept: 45
Hearing date: November
12, 2024
Moving Party: Plaintiff/Cross-Defendant
Rexford Industrial – 701 Kingshill, LLC; and Defendants/Cross-Defendants
E-Freight Logistics, LLC, Eshaan Mesghali, and Ali Manale
Responding
Party: Defendant/Cross-Plaintiff Autocom, Inc.
Motion
to Strike Answer and First Amended Cross-Complaint
The Court
considered the moving papers, opposition, reply.
The
motion is GRANTED.
Background
This
is a breach of lease action. On November 24, 2020, Plaintiff Rexford Industrial
filed this action against Autocom, Inc. (Cross-Plaintiff), E-Freight Logistics,
LCC (Defendant), Eshaan Mesghali (Defendant), Ali Manale (Defendant), and Does
1 through 10. Plaintiff alleges causes of action for: (1) Breach of Lease
Agreement; (2) Breach of Sublease Agreement; and (3) Breach of Guaranty.
On
February 12, 2021, Cross-Plaintiff filed an answer denying 42 of Plaintiff’s
factual allegations and admitting 31 of Plaintiff’s factual allegations.
On
May 3, 2021, Cross-Plaintiff filed a Cross-Complaint against Plaintiff and
Co-Defendants alleging four causes of action: (1) Breach of Contract; (2)
Breach of Guaranty; (3) Conversion; and (4) Negligence.
On
May 19, 2021, Plaintiff filed a demurrer in response to the Cross-Complaint
seeking to dismiss Cross-Plaintiff’s cause of action for Negligence.
On February 18,
2022, Cross-Plaintiff filed it First Amended Cross-Complaint
On March 8,
2022, Plaintiff filed a demurrer and motion to strike Cross-Complainant’s cause
of action for Negligence. The court overruled this demurrer on December 9,
2022.
On August 28,
2024, Plaintiff filed the instant motion to strike Cross-Plaintiff’s Answer and
First Amended Cross-Complaint. On September 5, 2024, Co-Defendants filed a
motion to join Plaintiff’s motion to strike.
On September 30,
2024, the court continued Plaintiff’s and Co-Defendants’ instant motion to
strike.
Discussion
In the instant motion to strike, Plaintiff
and Co-Defendants argue that the court should strike Cross-Plaintiff’s Answer
and First Amended Cross-Complaint on the grounds that Plaintiff has no right to
defend itself due to a suspended status. As the Court found in the September
30, 2024, order, Cross-Plaintiff’s legal status in California was suspended on
May 1, 2024 for lack of good standing with the Franchise Tax Board. The Court
found that because of Cross-Plaintiff’s lack of good standing with the Franchise
Tax Board under Revenue and Taxation Code section 23301, Cross-Plaintiff lacked
the legal capacity to defend itself. (See Cal. Rev. & Tax Code §
7056; Grell v. Laci Le Beau Corp. (1999) 73 Cal.App.4th 1300, 1306; Casiopea
Bovet, LLC v. Chiang (2017) 12 Cal.App.5th 656, 662.)
However, the court also found that Plaintiff and Co-Defendants failed to
satisfy the meet and confer requirements of the Code of Civil Procedure section
435.5, subdivision (a). The Court also noted that Cross-Plaintiff presented a
declaration from its CEO, Sang W. Kim, representing that Cross-Plaintiff was
already working with the Franchise Tax Board to restore its status.
Accordingly, the court “continue[d] the hearing on the motion to strike
for two months during which Plaintiff and Co-Defendants must satisfy the
meet-and-confer requirement and Cross-Plaintiff must remedy their suspension
status.” (9/30/24 Minute Order, p. 9.) “The court order[ed] Plaintiff and
Co-Defendants to file meet-and-confer declarations that comply with the
requirements of section 435.5 no later than seven court days prior to the
continued hearing date. [And] [t]he court order[ed] Cross-Plaintiff to file
declarations and evidence showing it is in good standing with the Franchise Tax
Board and Secretary of State no later than seven court days prior to the
continued hearing date.” (Ibid.)
Because the continued hearing date for this motion was set for November
12, 2024, the last day for the parties to file their declarations as required
by this court’s order was November 1, 2024. As of November 6, 2024, the court
has not received any declarations or evidence submissions from Cross-Plaintiff
showing its amended good standing status with the Franchise Tax Board and
Secretary of State. The only declaration this court has received is a
Declaration of Brent J. Kupfer, counsel for Cross-Defendants E-Freight
Logistics, LLC, Eshaan Mesghali, Ali Manale, and Rexford Industrial – 701
Kingshill, LLC.
Mr. Kupfer’s declaration attests that Mr. Kupfer sent multiple emails
attempting to schedule meet and confers with counsel for Plaintiff, Lane M.
Nussbaum, and counsel for Cross-Plaintiff, Matt Cortez, between October 21,
2024 and October 25, 2024. (Kupfer Decl., ¶¶ 1, 3, 5; Exh. 1.) Mr. Kupfer
states that he received multiple responses from Mr. Cortez providing different
dates of availability, and that Mr. Cortez left him a voicemail on October 23,
2024, but that when he attempted to call Mr. Cortez’s office on the dates
specified, he received no response. (Kupfer Decl., ¶¶ 2, 4, 6, 7.) Mr. Kupfer
further states that he never received response from Mr. Nussbaum regarding any
of his meet and confer correspondence. (Kupfer Decl., ¶¶ 3, 8.)
The Court finds that the declaration of Mr. Kupfer is sufficient to
demonstrate that Plaintiff/Cross-Defendant Rexford Industrial – 701 Kingshill,
LLC, and Cross-Defendants E-Freigh Logistics, LLC, Eshaan Mesghali, and Ali
Manale satisfied their meet and confer obligations pursuant to Code of Civil
Procedure 435.5, subdivision (a)(3). The court further finds that
Cross-Plaintiff has failed to file any supporting documentation showing that it
is in good standing with the Franchise Tax Board and the Secretary of State, as
explicitly required by this court’s September 30, 2024 minute order.
Accordingly, Plaintiff/Cross-Defendant’s and Co-Defendants’ Motion to
Strike Cross-Plaintiff’s Answer and First Amended Cross-Complaint is GRANTED.
It
is so ordered.
Dated:
_______________________
MEL RED RECANA
Judge of the
Superior Court