Judge: Michael E. Whitaker, Case: 22SMCV02859, Date: 2024-10-21 Tentative Ruling

Case Number: 22SMCV02859    Hearing Date: October 21, 2024    Dept: 207

TENTATIVE RULING

MOTION

This case arises from a dispute concerning a loan that was not repaid.  On December 27, 2022, Plaintiff (and now Judgment Creditor) New City Releasing, Inc. (“Plaintiff”) filed suit against Defendants Morning-Night View LLC (“Morning-Night”) and Yvonne Niami (“Niami”) (together, “Defendants”) alleging two causes of action for (1) promissory note; and (2) personal guaranty. 

Default judgment was entered against both Defendants on January 2, 2024 in the amount of $11,907,475.58.

Plaintiff now moves for a charging order as to Defendant (and Judgment Debtor) Yvonne Niami’s membership interest in the limited liability companies Philanthropy LLC and Viva XXXII LLC.  Plaintiff’s motion is unopposed.

REQUEST FOR JUDICIAL NOTICE

            Plaintiff requests judicial notice of the following:

·       Exhibit 2: Certified copies of n:Philanthropy LLC’s Initial Filing with the California Secretary of State filed on November 25, 2013, and the most recent Statement of Information filed with the California Secretary of State on May 11, 2022.

·       Exhibit 3: Certified copies of Viva XXXII LLC’s Initial Filing with the California Secretary of State filed on August 6, 2015, Certificate of Conversion filed on February 2, 2018, and the most recent Statement of Information filed with the California Secretary of State on June 24, 2020.

Plaintiff bases the request on Evidence Code section 452, subdivisions (d) and (h), which provide that judicial notice may be taken of:

(d) Records of (1) any court of this state or (2) any court of record of the United States or of any state of the United States.

(h) Facts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.

            Filings made with the California Secretary of State are not court records.  Therefore, judicial notice of these documents is not appropriate under subdivision (d).

            Under subdivision (h), the Court cannot take judicial notice of the truth of hearsay statements contained in documents third parties filed with the California Secretary of State, as the accuracy of the content of those documents may be subject to dispute.  (See, e.g., Lockley v. Law Office of Cantrell, Green, Pekich, Cruz & McCort (2001) 91 Cal.App.4th 875, 882.) 

            Therefore, the Court may only take judicial notice of the fact that this information has been publicly filed with the California Secretary of State, and the dates of such filings, but not the facts contained therein. 

ANALYSIS

            Code of Civil Procedure section 708.310 provides, “If a money judgment is rendered against a partner or member but not against the partnership or limited liability company, the judgment debtor’s interest in the partnership or limited liability company may be applied toward the satisfaction of the judgment by an order charging the judgment debtor’s interest pursuant to Section 15907.03, 16504, or 17705.03 of the Corporations Code.”

            Corporations Code section 17705.03, subdivision (a) provides: “On application by a judgment creditor of a member or transferee, a court may enter a charging order against the transferable interest of the judgment debtor for the unsatisfied amount of the judgment. A charging order constitutes a lien on a judgment debtor’s transferable interest and requires the limited liability company to pay over to the person to which the charging order was issued any distribution that would otherwise be paid to the judgment debtor.”

            Here, default judgment was entered against both Defendants in the amount of $11,907,475.58 on January 2, 2024.  (See Judgment.)  Post-judgment interest begins to accrue as of the date of judgment, even though the exact dollar amount had not yet been ascertained.  (See Felczer v. Apple Inc. (2021) 63 Cal.App.5th 406.)  Post-judgment interest accrues at a rate of 10 percent.  (Code Civ. Proc., § 685.010.)

Plaintiff has provided evidence that Niami is listed as a Manager or Member and the Chief Executive Officer (“CEO”) of N:Philanthropy LLC (Ex. 2 to Groeneveld Decl.) and the Organizer, Manager or Member, CEO, and Agent for Service of Process for VIVA XXXII LLC (Ex. 3 to Groeneveld Decl.).   Thus, Plaintiff has provided evidence that Niami has an ownership interest in both N:Philanthropy LLC and in VIVA XXXII LLC, and Niami has not provided any evidence to the contrary.

Plaintiff also indicates “Judgment debtors have not made any voluntary payments on the judgment and New City Releasing, Inc. has not collected anything on the judgment.”  (Groeneveld Decl. ¶ 4.) 

            Therefore, Plaintiff has demonstrated that Niami owes the balance of the judgment, and Niami has an ownership interest in N:Philanthropy LLC and in VIVA XXXII LLC, to which Plaintiff may attach to recover the outstanding balance of the judgment.

            As such, Plaintiff seeks $12,729,580.74, representing the full $11,907,475.58 judgment plus 10% annual post-judgment interest thereon for the 252 days from the January 2, 2024 judgment up to and including September 10, 2024, the date of Plaintiff’s motion.

CONCLUSION AND ORDER

Therefore, Plaintiff’s motion is granted and the Court will enter the Order as proposed, except for the accounting requirements set forth in paragraphs 3 and 6. 

If applicable, Plaintiff shall provide notice of the Court’s ruling and file the notice with a proof of service forthwith. 

DATED:  October 21, 2024                                                   ___________________________

                                                                                          Michael E. Whitaker

                                                                                          Judge of the Superior Court