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Judge: Melissa R. Mccormick, Case: "KBLyons IRA, LLC, et al. v. JMR Capital Group, Inc.", Date: 2023-08-10 Tentative Ruling

Plaintiffs KBLyons IRA, LLC and Kenneth Lyons’s Motion for Reconsideration

Plaintiffs KBLyons IRA, LLC and Kenneth Lyons move for reconsideration of the court’s April 6, 2023 order denying plaintiffs’ application for entry of default judgment against defendants JMR Capital Group, Inc., Laguna Beach Motors, and Michael Ross. Plaintiffs’ motion for reconsideration is denied.

The court denied plaintiffs’ application for entry of default judgment for the reasons set forth in the court’s April 6, 2023 order. See 4/6/23 Order. In sum, and as further detailed in the April 6, 2023 order, the court denied plaintiffs’ application because plaintiffs’ complaint does not allege sufficient facts to state causes of action against defendants, and because neither the complaint nor plaintiffs’ application demonstrated why plaintiffs would be owed $97,530.85. Id. The court’s order was “without prejudice to plaintiffs submitting another application that addresses the issues in th[e] ruling.” Id. The order also states, “Should plaintiffs desire to file an amended complaint, see Rodriguez v. Nam Min Cho (2015) 236 Cal.App.4h 742, 755, plaintiffs shall file and serve it by April 27, 2023.” Id.

Plaintiffs did not file an amended complaint. Plaintiffs instead filed the instant motion for reconsideration. Plaintiffs contend the court should reconsider the April 6, 2023 order because the court allegedly did not consider the case summaries (ROA 81, 83, 85) plaintiffs filed on April 3, 2023. Plaintiffs assert the case summaries “provide[ ] applications to law and exhibited documents to support the causes of action pleaded.” Brief at 6:15-16. Plaintiffs state the case summaries provide facts not alleged in the complaint that support plaintiffs’ causes of action. Brief at 6:28-7:14; see also id. at 7:16-9:28

As an initial matter, the court received and reviewed plaintiffs’ case summaries. More fundamentally, as plaintiffs acknowledge, the additional facts described in plaintiffs’ motion for reconsideration and the case summaries do not appear in the complaint. A default judgment against a particular defendant cannot be based on a complaint that fails to state a cause of action against that defendant. Kim v. Westmoore Partners, Inc., (2012) 201 Cal.App.4th 267, 271-72, 282, 286; see also Ferraro v. Camarlinghi (2008) 161 Cal.App.4th 509, 539 (“Under the ‘well pleaded’ complaint rule, it is error to enter a default judgment on a complaint that fails to state a cause of action against the defaulting defendant.”).

Should plaintiffs desire to file an amended complaint addressing the issues identified in the court’s April 6, 2023 order, see Rodriguez v. Nam Min Cho (2015) 236 Cal.App.4h 742, 755, plaintiffs shall file and serve it by September 5, 2023.

Clerk to give notice.

Order to Show Cause re: Dismissal

The Order to Show Cause re: Dismissal is continued to November 9, 2023 at 9:00 a.m.

Plaintiff is ordered to appear. Failure to appear will result in dismissal of the entire action.

Clerk to give notice.