Judge: Randall J. Sherman, Case: 2016-00884951, Date: 2022-12-23 Tentative Ruling
Cross-Defendant Team Makena, LLC’s Motion for Summary Adjudication of John Lasso’s Alleged Second Cause of Action for Breach of Contract is denied. Team Makena’s Request for Judicial Notice is granted.
The court will consider all papers filed in connection with this motion. The opposition was due on December 9, 2022, 14 days before the hearing pursuant to CCP §§437c(b)(2), but was filed three days later, on December 12, 2022. However, there was no actual prejudice to Team Makena since it filed a reply that made substantive responses to the arguments raised in the opposition papers. The court overrules Team Makena’s objection to, and denies its motion to strike, Lasso’s opposition papers. Nonetheless, the court expects all future filings to be timely and compliant with all applicable procedural rules.
Team Makena seeks summary adjudication of John Lasso’s second cause of action for breach of contract based on Team Makena’s alleged failure to indemnify Lasso in this action. Team Makena argues that it has no duty to indemnify Lasso because he was never a Member of Team Makena and because he resigned as a Manager of Team Makena on November 11, 2016. Article 11.1 of the 2009 Amended and Restated Limited Liability Company Agreement of Team Makena, LLC begins by saying. “The Company shall indemnify any Member or Manager who was or is a party to any threatened, pending or completed action,” and Lasso resigned as a Manager, suggesting that only current Members or Managers are entitled to the contractual indemnification. However, later language in Article 11.1 provides for indemnity in a situation where the person was sued “because such Person is or was a Member or Manager of the Company”. Team Makena specifically alleges in ¶15 of its First Amended Complaint that Lasso is not being sued as a former Manager of Team Makena, but only for wrongful acts committed in his capacity as an officer and personally as a signatory to certain provisions of the Operating Agreement. Thus, Team Makena does not owe Lasso an indemnity based on its First Amended Complaint, and Team Makena will be estopped at trial from asserting that Lasso is liable for breaching fiduciary duties he owed as a Manager, and the like. However, in the original Complaint filed by both Team Makena and Ossur Americas on November 3, 2016, plaintiffs alleged in ¶33, as to Lasso and another person, “As officers and managers of Team Makena, the OFFICERS owe fiduciary duties to Plaintiffs”, and alleged in ¶34 that Lasso breached his fiduciary duties and was therefore liable to plaintiffs. Team Makena did not file its First Amended Complaint until October 15, 2019, amending its allegations presumably to avoid invoking the duty to indemnify. But between November 8, 2016, when Lasso provided a required written undertaking, until October 15, 2019, when Team Makena filed its First Amended Complaint, Team Makena may have owed Lasso an indemnification, subject to the applicability of the contractual exception when “such Person has engaged in willful misconduct, a knowing violation of criminal law, or gross negligence”. As a result, Team Makena is not entitled to summary adjudication as to Lasso’s second cause of action.
Defendants are ordered to give notice of the ruling unless notice is waived.
On October 28, 2022 the court set a hearing for today on Objections to Judge Andler’s Recommendation. Opposition was to be served and filed nine court days before the hearing, and any reply was to be served and filed five court days before the hearing. The court sees no subsequent briefing, and thus does not know if Judge Andler’s Recommendation is still in dispute, as well as the status of the forensic inspection that has been discussed. The court does note that defendants set a hearing for February 17, 2023 as to a Judge Andler Recommendation, which may or may not relate to plaintiffs’ disputed issues. The parties should appear and explain the status of this matter if they still want the court to resolve it.