Judge: Michelle Williams Court, Case: BC474472, Date: 2022-10-26 Tentative Ruling

Case Number: BC474472    Hearing Date: October 26, 2022    Dept: 74

BC474472      OPTIONAL CAPITAL INC VS DAS CORPORATION

DAS Corporation’s Motion for an Order Returning the Deposit in Lieu of Appellate Bond of $4,323,177.93

TENTATIVE RULING:  The motion is GRANTED.

Background

On December 1, 2011, Plaintiffs Optional Capital, Inc., Ralph Rogari, and Mary Lee filed this action against DAS Corporation, Erica Kim, Christopher Kim aka Kyung Joon Kim, Bora Lee, Eric Honig, John Karaczynski, Michael Starr, Atkin, Gump, Strauss, Hauer & Feld, LLP, William Mills, David Parker, Parker, Shumaker, Mills, LLP, Robert Fiechter, Des Gouttes & Associes, Nicolas Pierard, Borel & Barbey, Alexandria Investments, LLC, and Hyung Soon Kim.

On July 9, 2019, the Court entered judgment on the jury’s special verdict which found DAS Corporation was liable to Optional Capital in the amount of $2 million. After the Court denied DAS’s post-judgment motions, DAS appealed the judgment.

On November 5, 2020, DAS filed a Notice of Deposit of $4,323,177.93 in Lieu of Appellate Bond Pursuant to Code of Civil Procedure Sections 917.1 and 995.710.

On June 23, 2022, the Court received the remittitur of the Court of Appeal’s opinion reversing the judgment and remanding the case with instructions to enter a new judgment for DAS.

On September 22, 2022, the Court entered the Amended Judgment Pursuant to Remittitur of Court of Appeal.

Motion

On September 30, 2022, Defendant DAS Corporation filed the instant motion seeking the return of its deposit in lieu of appellate bond.

The motion is unopposed. (Code Civ. Proc. § 1005(b).)

Request for Judicial Notice

DAS requests the Court take judicial notice of its Notice of Deposit, the Court of Appeal’s Remittitur dated June 23, 2022, the Court of Appeal’s Opinion dated September 26, 2022, and the Court’s amended judgment dated September 22, 2022. The requests are GRANTED. (Evid. Code § 452(d).)

Discussion

On November 4, 2020, LTL Attorneys, LLP, on behalf of DAS Corporation, deposited $4,323,177.93 with the clerk pursuant to Code of Civil Procedure sections 917.1 and 995.710. Code of Civil Procedure section 917.1 requires that an undertaking be given to stay enforcement of a money judgment during the pendency of an appeal. Pursuant to Code of Civil Procedure 995.710(a)(1), “the principal may, without prior court approval, instead of giving a bond, deposit with the officer any of the following: (1) Lawful money of the United States or a cashier's check, made payable to the officer, issued by a bank, savings association, or credit union authorized to do business in this state. The money shall be held in trust by the officer in interest-bearing deposit or share accounts.”

“A deposit given pursuant to this article shall be returned to the principal at the earliest of the following times:

(a) Upon substitution of a sufficient bond for the deposit. The bond shall be in full force and effect for all liabilities incurred, and for acts, omissions, or causes existing or which arose, during the period the deposit was in effect.

(b) The time provided by Section 995.360 for return of a bond.

(c) The time provided by statute for return of the deposit.”

(Code Civ. Proc., § 995.770.) Section 995.360 provides “[a] bond given in an action or proceeding may be withdrawn from the file and returned to the principal on order of the court only if one of the following conditions is satisfied: (a) The beneficiary so stipulates. (b) The bond is no longer in force and effect and the time during which the liability on the bond may be enforced has expired.” Pursuant to Code of Civil Procedure section 995.430(b), “[a] bond remains in force and effect until the earliest of the following events: . . . The purpose for which the bond was given is satisfied or the purpose is abandoned without any liability having been incurred.” The purpose of DAS’s deposit was to secure the judgment during the pendency of the appeal. (Code Civ. Proc. § 917.1(b).)

As noted above, the appeals have concluded and judgment has been entered in favor of Defendant DAS. Accordingly, “the purpose for which the [deposit] was given is . . . abandoned without any liability having been incurred” and the deposit is therefore no longer in force and effect. (Code Civ. Proc. § 995.430(b).) As a result, the deposit is properly withdrawn and returned. (Code Civ. Proc. §§ 995.360(b); 995.770(b).) As noted by Defendant, the deposit shall be returned with interest. (Code Civ. Proc. § 995.740(a) (“If no proceedings are pending to enforce the liability of the principal on the deposit, the officer shall: (a) Pay quarterly, on demand, any interest on the deposit, when earned in accordance with the terms of the account or certificate, to the principal.”).)