Judge Ralph C. Hofer, Case 22BBCV00991 2023-03-24 Tentative Ruling

Plaintiff Gewo Khachadoorian alleges that in March of 2020 plaintiff commenced a boyfriend-girlfriend relationship with defendant Talin Mouradian, who was working at a drug and alcohol rehabilitation facility. Defendant Mouradian represented that she was an expert and well-informed on operating a rehabilitation business and suggested that they work together to establish such a business. Plaintiff agreed to explore the idea, and approached two childhood friends, defendant Norbeh Aboolian and defendant Fred Akopyan, concerning investing in the business.

In July of 2020, the parties agreed and all signed an agreement that each of them was the owner of 25% of the new business venture. Plaintiff alleges that he initially invested sums totaling $35,000 in the business, and in place of further cash contribution paid defendant Mouradian’s personal expenses for six to eight months, at approximately $4,000 to $5,000 per month. Plaintiff alleges that defendant Mouradian did not contribute or invest any funds toward the new business venture, but represented that her knowhow of the business would substitute for her contribution in the new business.

The parties located premises for the business and filed Articles of Incorporation with the Secretary of State on December 8, 2020 for the business Hillcrest Recovery, Inc., which business was named Hollywood Hills Recovery. Plaintiff and defendant Mouradian commenced fixing the physical location of the business, and obtained the necessary licenses, and the new business began functioning as an inpatient rehabilitation center. Plaintiff and defendant Mouradian physically worked at the new business, but defendants Aboolian and Akopyan did not, but continued to be engaged in their own trucking business.

The complaint alleges that the parties proceeded to hire staff, and begin promoting the business, and from July 2021 through July 2022, plaintiff attracted many patients to the business and the business received large sums of monies from insurance companies and patients, which plaintiff alleges are still maintained in the business bank accounts, for which plaintiff requires an accounting.

It is also alleged that in June of 2021, plaintiff and defendants established an outpatient recovery center, bringing in defendant Phillip (“Chill”) Aguilar, who was knowledgeable about outpatient recovery systems. Articles of Incorporation and a Statement of Information were filed for Studio 64 Recovery, the same as defendant Greatest Recovery, naming defendant Aguilar as the president, defendant Mouradian as the secretary and plaintiff has one of the directors. The complaint alleges that this outpatient business is functioning and producing funds for the business owned by the parties in this case.

The complaint alleges that the relationship between plaintiff and defendant Mouradian declined, with the parties moving out of the apartment they shared and defendant Mouradian making threats to destroy plaintiff’s life. Plaintiff alleges that defendant Mouradian then took plaintiff’s social security card and credit cards and made unauthorized charges, causing his credit score to decrease, sent plaintiff insulting texts, attacked plaintiff’s companions, assaulted plaintiff, and hacked into plaintiff’s Google account.

Plaintiff alleges that plaintiff sought a restraining order against defendant Mouradian, and two days later defendant Mouradian filed a petition for restraining order against plaintiff, as a result of which the parties stipulated to a mutual restraining order directing each of them to stay away from the other by 100 yards. This restraining order prevents plaintiff from visiting the business premises and from attending to business affairs.

The complaint alleges that on the date defendant Mouradian filed the petition for a restraining order against plaintiff, defendants filed Articles of Incorporation for Hollywood Hills Recovery and for Greatest Care Center, removing plaintiff’s name as director or officer of those entities. It is also alleged that the defendant Mouradian caused damage to plaintiff’s vehicle.

Plaintiff alleges he has served the board of directors with formal notice demanding plaintiff be permitted access to the books and records, demanding that defendants provide notice of any sale, conversion, merger or transfer of any assets of the corporations, and calling a special meeting relating to the ownership interests of the shareholders. Defendants have not permitted the accounting, have refused to call for or attend board of director meetings, and have failed to distribute profits. Plaintiff alleges that the individual defendants, and specifically defendant Mouradian, have been guilty of or knowingly countenanced pervasive fraud, mismanagement, abuse of authorities and unfairness toward plaintiff, whose property is being misapplied.

Defendants Mouradian, Aboolian, Akopyan, Aguilar, Hillcrest Recovery Inc., The Real Hollywood Hills Recovery, Greatest Recovery Center, and Studio 64 Recovery have filed a Verified Answer to the Complaint. The Answer responds to each of the allegations of the complaint, and sets forth twenty-five affirmative defenses.

Defendants Mouradian, Aboolian, Akopyan, Aguilar, Hillcrest Recovery Inc., and Studio 64 Recovery Inc. have also filed a cross complaint against plaintiff Khachadoorian, as cross-defendant, alleging that the individual parties entered into agreements with respect to the entity defendants Hillcrest Recovery and Studio 64 Recovery for the operation of substance use disorder and mental health treatment facilities. The cross-complaint alleges that based on the nature of the addiction treatment business, there was an implied agreement amongst the parties to maintain abstinence from drugs and alcohol, especially when they were physically present at the business premises. The cross-complaint alleges that all of the individual parties were in recovery from addiction or alcoholism themselves at the time the businesses commenced, and sobriety was mutually understood as a critical prerequisite for participating in the business.

The cross-complaint alleges that the beginning in September of 2021, cross-defendant Khachadoorian began acting erratically, so that business clients began reporting that cross-defendant appeared inebriated on site, and also that cross-defendant was developing inappropriate relationships with clients of the businesses. In March of 2022, cross-complainants requested, and cross-defendant agreed to submit a urine specimen for toxicology testing, which specimen tested positive for alcohol, marijuana, methamphetamines and benzodiazepines. It is alleged that when confronted with the drug test results, cross-defendant admitted to abusing drugs, and that he had stolen some of the drugs he was abusing from the businesses’ own medication disposal receptacles.

In March of 2022, cross-defendant voted unanimously with the individual cross-complainants to amend the bylaws of the corporate cross-complainants to have cross-defendant resign from all positions within the corporations, and to reflect their written agreement that any corporate shareholder would forfeit and fully relinquish their ownership interest if they failed to remain abstinent from marijuana, alcohol, non-prescribed pharmaceutical, and illegal drugs.

The cross complaint alleges that cross-complainants paid for cross-defendant’s treatment and ongoing therapy, and supported cross-defendant in obtaining treatment, but cross-defendant left inpatient drug rehab early, and clients of the businesses observed cross-defendant’s old behaviors, causing cross-complainants to believe that cross-defendant continued to abuse drugs and alcohol through this period, and they ordered plaintiff to vacate the facility, determining his behavior was counter-productive to the recovery of the other residents. Cross-complainants allege that they tried to keep cross-defendant involved in the business by having him perform work off-site but discovered that cross-defendant had commenced a sexual relationship with a client of the businesses, and had pressured the client to keep the event secret.

The cross-complaint alleges that cross-defendant’s actions jeopardized the licensure status and damaged the reputations of the businesses, causing drastic reductions in revenues and lasting financial repercussions, including the loss of clients.

Cross-complainants also allege that cross-defendant’s outside business dealings, pursuant to which cross-defendant became embroiled in a financial dispute related to a healthcare business run by cross-defendant’s mother, caused further compromise of the reputation and continued operation of the businesses. It is also alleged that cross-defendant continued to harass staff members and patients of the businesses when he encountered them at 12-step programs in the area, and during the course of hearings in the ongoing domestic dispute with cross-complainant Mouradian.

In September of 2022, cross-complainants formally requested that cross-defendant forfeit his ownership interests in accordance with the terms of the March amendments, in response to which cross-defendant filed suit against cross-complainants. At a December 20, 2022 meeting of the board of directors of both entities, cross-complainants cancelled cross-defendant’s stock in each corporation, and authorized payment of $20,000 from each corporation pursuant to the March amendments.

“(a) Before filing a demurrer pursuant to this chapter, the demurring party shall meet and confer in person or by telephone with the party who filed the pleading that is subject to demurrer for the purpose of determining whether an agreement can be reached that would resolve the objections to be raised in the demurrer.

It does appear that the moving papers do not include the actual meet and confer correspondence which was sent by counsel for plaintiff. Although the Slavitt Declaration indicates it is attached to the declaration, there is no meet and confer letter attached to the copy filed with the court, which evidently should have been Exhibit 2. [See Declaration of Steven Slavitt re Meet and Confer]. (The meet and confer letter is submitted with the reply. [Reply, Ex. 3]).

“We wish to do everything in this case in writing and we will do so by sending you a detailed meet and confer letter containing any and all grounds for our demurrer. CCP 430 does not prohibit written meet and confer attempts. If we were to do it on the phone it would take a couple of hours and we do not wish to do so.”

Plaintiff in reply does not dispute that the language of the statute requires a meet and confer to be conducted in person or by telephone, but again argues that the statute does not prohibit meeting and conferring through a writing. The court does not find this argument persuasive, particularly when there has been an express request on the part of the party which filed the pleading for an in person or telephonic meet and confer, as required by statute. The reply also argues that a telephonic meet and confer should not be expected here, where there are multiple affirmative defenses, and the parties have been engaged in acrimonious restraining order proceedings. Such exceptions do not appear in the statute, and the court expects the attorneys for the parties to conduct themselves with civility regardless of the previous conduct of their clients or the animosity between the clients.

The court recognizes that it could refuse to hear the matter until an appropriate meet and confer has been conducted, in effect, continue the matter and require the parties to further meet and confer. The court in the circumstances before it finds that requiring a further meet and confer would waste judicial resources, and the court proceeds to consider the demurrer on its merits at this time. Plaintiff’s counsel is cautioned, however, that during this litigation this court will expect full compliance with all statutes, rules and procedures governing the action.

“(2) The parties shall meet and confer at least five days before the date the responsive pleading is due. If the parties are not able to meet and confer at least five days prior to the date the responsive pleading is due, the demurring party shall be granted an automatic 30-day extension of time within which to file a responsive pleading, by filing and serving, on or before the date on which a demurrer would be due, a declaration stating under penalty of perjury that a good faith attempt to meet and confer was made and explaining the reasons why the parties could not meet and confer.”

The statute does not appear to require an explanation to include details concerning the “in person or by telephone requirement” of the meet and confer statute. The court recognizes that the need for a continuance can be occasioned by an inability to timely connect despite an attempt on the part of the demurring party to do so, particularly in connection with the narrow ten-day window governing demurrers to answers, and it would appear that a written meet and confer attempt which has not yet been responded to could provide a reasonable explanation.

The declaration here is made on the approved Judicial Council form, and indicates that a meet and confer letter was sent outlining the defects, to which there had evidently not yet been a response. [Declaration of Demurring or Moving Party in Support of Automatic Extension filed 02/15/2023]. However, the court is again concerned that the declaration was filed on February 15, 2023, and that well in advance of the filing of the declaration, on February 7, 2022, plaintiff had received a request from defendants for a meet and confer by telephone and had refused it. [See Blackmar Decl., Exs. A, B]. The explanation in the declaration in support of the automatic extension does not appear to offer the complete facts concerning the representation that the parties were unable to meet and confer in time. The court would be within its discretion to decline to accept the representations in the Declaration in Support of Automatic extension, and overrule the demurrer as untimely. However, the court exercises its discretion, and the court considers the demurrer on its merits.

Under CCP section 430.30, an objection may be taken by demurrer to a pleading, “[w]hen any ground for objection to” an “answer appears on the face thereof, or from any matter of which the court is required to or may take judicial notice…”

The memorandum then argues that defendants do not and cannot, as a matter of law, state a defense to any of the causes of action for damages and injuries, and this demurrer must be sustained. The memorandum cites to no legal authority for this argument other than the above statutes. That meager presentation is basically the substance of the memorandum.

The answer includes a specific denial of the material allegations of the complaint controverted by defendants, and statements of new matter constituting defenses, such as failure of plaintiff to mitigate damages. [See Answer, pp. 2-16, Third Affirmative Defense].

Moreover, as argued in the opposition, it is recognized that in evaluating the sufficiency of an answer, the allegations of the pleading to which it responds may be considered. See South Shore Land Co. v. Petersen (1964) 226 Cal. App.2d 725, 733.

In fact, it is recognized that plaintiffs rarely demur to answers, even though they have such a right pursuant to CCP § 430.30(a). See Weil & Brown, California Practice Guide: Civil Proc. Before Trial (The Rutter Group, 2022 rev.) para. 6:476. The practice is disfavored due to the notice-based aspects of pleadings. South Shore Land Co. v. Peterson (1964) 226 Cal.App.2d 725, 733.

Please make arrangement in advance if you wish to appear via LACourtConnect/Microsoft Teams by visiting www.lacourt.org to schedule a remote appearance. Please note that LACourtConnect/Microsoft Teams offers free audio and video appearance. Counsel and parties (including self-represented litigants) are encouraged not to personally appear. With respect to the wearing of face masks, Department D recognizes that currently, the Los Angeles Department of Public Health strongly recommends masks indoors, especially when interacting with individuals whose vaccination status is unknown; for individuals who have a health condition that puts them at higher risk for severe illness; individuals who live with someone who is at higher risk; and for individuals who are around children who are not yet eligible for vaccines. In accordance with this guidance, it is strongly recommended that anyone personally appearing in Department D wear a face mask. The Department D Judge and court staff will continue to wear face masks. If no appearance is set up through LACourtConnect/Microsoft Teams, or otherwise, then the Court will assume the parties are submitting on the tentative.