Judge: Richard S. Whitney, Case: 37-2019-00023974-CU-BT-CTL, Date: 2024-01-05 Tentative Ruling

SUPERIOR COURT OF CALIFORNIA,

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HALL OF JUSTICE

TENTATIVE RULINGS - January 04, 2024

01/05/2024  10:30:00 AM  C-68 COUNTY OF SAN DIEGO

JUDICIAL OFFICER:Richard S. Whitney

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Civil - Unlimited  Business Tort Summary Judgment / Summary Adjudication (Civil) 37-2019-00023974-CU-BT-CTL OSIK MEDIA LLC VS. MALDONADO [IMAGED] CAUSAL DOCUMENT/DATE FILED:

TENTATIVE RULING: DEFENDANTS PIETRO LA GRECA JR.'S, AGOLEA COMUNICACIONES', APIA CAPITAL MANAGEMENT'S, AND APIA GLOBAL HOLDINGS' MOTION FOR SUMMARY JUDGMENT OR, IN THE ALTERNATIVE, SUMMARY ADJUDICATION is GRANTED, in part, and DENIED, in part.

Defendants Agolea Comunicaciones, S. de R.L. de C.V. ('Agolea'); Apia Capital Management, LLC ('Apia Capital'); and Apia Global Holdings, LLC ('Apia Global') (collectively the 'La Greca Defendants') challenge each of the causes of action against them on three main grounds. First, the La Greca Defendants assert the Conisa subleases are not enforceable since the Master Lease with La Greca Jr.'s signature was forged. Second, Plaintiff Osik Media, LLC ('Osik') cannot prove damages caused by reliance on misrepresentations by the La Greca Defendants. Third, the interim agreement during settlement negotiations (February 2014 Agreement) did not contain a fixed duration term such that there was no breach.

In ruling on a summary judgment motion, the trial court must first identify the issues framed by the pleadings, since the pleadings set the boundaries of the issues to be resolved, and the materiality of disputed facts. (Conroy v. Regents of University of Cal. (2009) 45 Cal.4th 1244, 1250; Nativi v. Deutsche Bank National Trust Company (2014) 223 Cal.App.4th 261, 289-90; Serri v. Santa Clara University (2014) 226 Cal.App.4th 830, 858.) The Court then determines whether the moving party has established facts justifying judgment in its favor, and if the moving party has carried its initial burden, decide whether the opposing party has demonstrated the existence of a triable issue of material fact. (Serri, supra, at p. 858.) The Court must 'liberally construe the evidence in support of the party opposing summary judgment and resolve doubts concerning the evidence in favor of that party.' (Dore v. Arnold Worldwide, Inc. (2006) 39 Cal.4th 384, 389.) It is undisputed that the enforceability of the Conisa subleases depends on the enforceability of the Master Lease. La Greca Defendants assert Osik cannot provide evidence that the signature of La Greca Jr. on the Master Lease was electrically lifted and placed on the Master Lease by La Greca Jr. La Greca Defendants point to evidence that La Greca Jr. first learned of the Master Lease long after it was purportedly signed by him and the opinion of their expert, Michael Wakshull, that the signature was electronically extracted and pasted onto the Master Lease. (La Greca Defendants' Separate Statement of Undisputed Material Facts [SSUMF] Nos. 1-36.) Osik disputes the evidence with the declaration of Osik's expert, Bart Baggett, who opines La Greca Jr.'s signature was not 'electronically extracted' and that there are no indications of any forgery. (Osik's response to SSUMF Nos. 32-36.) The Court finds Calendar No.: Event ID:  TENTATIVE RULINGS

3040017  52 CASE NUMBER: CASE TITLE:  OSIK MEDIA LLC VS. MALDONADO [IMAGED]  37-2019-00023974-CU-BT-CTL Osik has sufficiently raised issues of fact as to La Greca Defendants' arguments regarding La Greca Jr.'s signature. The Court declines to speculate that La Greca Sr. would not have forged the signature of La Greca Jr. because he had a power of attorney such that he could have signed on La Greca Jr.'s behalf. But in any event, there are still triable issues of fact as to La Greca Jr.'s signature.

Next, La Greca Defendants argue the fraud causes of action fail because Osik cannot prove any damages from reliance on any purported misrepresentation. La Greca Defendants assert that Osik has only identified benefit-of-the-bargain damages. In response, Osik provides evidence that it was forced to breach its obligations to its clients, causing damage to Osik's business reputation or goodwill. (Osik's response to SSUMF No. 52.) Osik also provides evidence it incurred advertisement placement costs and attorneys' fees as a result of the purported false promises. (Osik's response to SSUMF No. 52.) La Greca Defendants asserts Osik cannot rely upon loss of goodwill. The cases cited by La Greca Defendants do not state loss of goodwill cannot be measured or compensated.

Where an established business's operation is prevented or interrupted, ' 'damages for the loss of prospective profits that otherwise might have been made from its operation are generally recoverable for the reason that their occurrence and extent may be ascertained with reasonable certainty from the past volume of business and other provable data relevant to the probable future sales. [Citations.]' ' (Kids' Universe, supra, 95 Cal.App.4th at p. 883, 116 Cal.Rptr.2d 158, citing Grupe v. Glick (1945) 26 Cal.2d 680, 692–693, 160 P.2d 832.) On the other hand, lost anticipated profits for an unestablished business whose operation is prevented or interrupted are generally not recoverable because their occurrence is uncertain, contingent and speculative.

(Parlour Enterprises, Inc. v. Kirin Group, Inc. (2007) 152 Cal.App.4th 281, 287–288.) La Greca Defendants do not provide evidence that Osik was not an established business. La Greca Defendants do not provide evidence that Osik's goodwill could not be quantified. Further, Petralia declares that '[i]t is reasonably certain that Osik would have been able to do business with MetroPCS, in addition to advertising on the billboards, if not for Osik being forced to breach its obligations to MetroPCS in October 2018.' (See Osik's response to SSUMF No. 52.) Petralia supports this conclusion with an explanation. (See Osik's response to SSUMF No. 52.) The Court finds Osik has sufficiently raised issues of fact as to La Greca Defendants' arguments concerning damages caused by detrimental reliance.

Finally, the La Greca Defendants assert Osik's breach-of-February-2014-Agreement-related causes of action against Agolea – including Osik's Eighth Cause of Action (Breach of Written Agreement), Ninth Cause of Action (Breach of Implied Covenant of Good Faith and Fair Dealing), and Tenth Cause of Action (Promissory Estoppel) – fail because the February 2014 Agreement did not contain a fixed duration term.

The basic goal of contract interpretation is to give effect to the parties' mutual intent at the time of contracting. (Civ. Code, § 1636; Bank of the West v. Superior Court (1992) 2 Cal.4th 1254, 1264 [10 Cal.Rptr.2d 538, 833 P.2d 545].) When a contract is reduced to writing, the parties' intention is determined from the writing alone, if possible. (Civ. Code, § 1639.) 'The words of a contract are to be understood in their ordinary and popular sense.' (Civ. Code, § 1644; see also Lloyd's Underwriters v. Craig & Rush, Inc. (1994) 26 Cal.App.4th 1194, 1197-1198 [32 Cal.Rptr.2d 144] ['We interpret the intent and scope of the agreement by focusing on the usual and ordinary meaning of the language used and the circumstances under which the agreement was made'].) (Founding Members of the Newport Beach Country Club v. Newport Beach Country Club, Inc. (2003) 109 Cal.App.4th 944, 955.) 'California cases have long recognized that a contract may, by its express terms, provide for a term of duration of indefinite length and without specific limitation, tied not to the calendar but to the conduct of Calendar No.: Event ID:  TENTATIVE RULINGS

3040017  52 CASE NUMBER: CASE TITLE:  OSIK MEDIA LLC VS. MALDONADO [IMAGED]  37-2019-00023974-CU-BT-CTL the contracting parties.' (Zee Medical Distributor Association, Inc. v. Zee Medical, Inc. (2000) 80 Cal.App.4th 1, 7.) 'The general California rule appears to be that a contract is not fatally defective merely because it does not specify a time presently definite for its termination, [citation]. The rule is that if the contract is to remain in effect so long as one continues to perform or act in a certain manner ... the agreement is sufficiently certain to be vital. [Citations.]' (Id. citing Zimco Restaurants, Inc. v. Bartenders and Culinary Workers Union, Local 340, AFL-CIO (1958) 165 Cal.App.2d 235, 237.) [T]he California Supreme Court set out a three-step analysis for determining a contract's term of duration. First, courts look for an express duration provision in the contract. If one exists, we enforce it according to its terms. Second, if the contract does not have an express provision, we look to the intention of the parties to imply a duration. Third, if we find neither an express nor an implied term, we construe the term of duration to be a reasonable time. (Consolidated, supra, 69 Cal.2d at pp. 723–731, 73 Cal.Rptr. 213, 447 P.2d 325.) (RMR Equipment Rental, Inc. v. Residential Fund 1347, LLC (2021) 65 Cal.App.5th 383, 393.) When the third option applies 'the law usually implies that the term of duration shall be at least a reasonable time, and that the obligations under the contract shall be terminable at will by any party upon reasonable notice after such a reasonable time has elapsed.' (Consolidated Theatres, Inc. v. Theatrical Stage Emp.

Union, Local 16 (1968) 69 Cal.2d 713, 727–728.) Here, the February 2014 Agreement does not contain any term of duration. The February 2014 Agreement also does not contain terms that the agreement would remain in effect for as long as certain performance continued, but implied it was temporary. Agolea agreed it would 'not remove the ad copy or otherwise interfere with it during the pendency of our ongoing settlement discussions....' (Osik's response to SSUMF No. 46.) The February 2014 Agreement mentions this term in the context of Agolea agreeing to not move forward with interfering with Osik's use of the billboards. However, the February 2014 Agreement also required: Osik provides documentation to show any revenues that it receives from either the south-facing billboard referred to above or the the [sic] north-facing billboard that your client had leased from Conisa International which is located at my client's property in Tijuana and (2) your client Osik promptly (within three business days from receipt) remits to my client Agolea one-half (50%) of all such revenues it receives in connection with these two billboards by wire transfer to the following account [omitted] (Osik's response to SSUMF No. 46.) The plain terms of the February 2014 Agreement indicate that the parties intended for the agreement to apply until settlement negotiations stopped. The limiting duration was the length of settlement discussions.

While La Greca Defendants provide evidence that the settlement negotiations had stalled and fizzled by the fall of 2014, Osik cites to evidence that the parties appeared to be ready to sign an agreement by August of 2014. (Osik's response to SSUMF No. 51.) Osik also points to testimony of Maldonado, the attorney representing Agolea, that the agreement would continue '[u]ntil either the settlement discussions ended or the settlement agreement itself was signed.' (Osik's response to SSUMF No. 49.) However, this supports that there was not fixed duration. The intent of the parties was to negotiate a settlement, but that was not the only option. The settlement discussions could end. The Court finds the February 2014 Agreement was terminable at will after a reasonable amount of time. The Court finds that four years was more than a reasonable amount of time. Terminating the settlement discussions after four years was not a breach of the February 2014 Agreement. While Osik attempts to raise an issue of fact as to whether the settlement discussions stopped before the La Greca Defendants purportedly breached the agreement in October of 2018, Osik does not point to any provision of the February 2014 Agreement that dictates how the parties are to indicate settlement discussions ended. The Court finds the La Greca Defendants could terminate the settlement discussions within a reasonable period of time, which they did, even if the notice of the termination came in the form of notice that the billboards were being leased to someone else.

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3040017  52 CASE NUMBER: CASE TITLE:  OSIK MEDIA LLC VS. MALDONADO [IMAGED]  37-2019-00023974-CU-BT-CTL La Greca Defendants also argue the claim for breach of the covenant of good faith and fair dealing fails because the February 2014 Agreement did not impose a duty to negotiate terms of an agreement. 'The fact that parties commence negotiations looking to a contract, or to the amendment of an existing contract, does not by itself impose any duty on either party not to be unreasonable or not to break off negotiations, for any reason or for no reason.' (Racine & Laramie, Ltd. v. Department of Parks & Recreation (1992) 11 Cal.App.4th 1026, 1034.) However, 'a contract to negotiate an agreement is distinguishable from a so-called 'agreement to agree' and can be formed and breached just like any other contract.' (Copeland v. Baskin Robbins U.S.A. (2002) 96 Cal.App.4th 1251, 1253.) A contract to negotiate the terms of an agreement is not, in form or substance, an 'agreement to agree.' If, despite their good faith efforts, the parties fail to reach ultimate agreement on the terms in issue the contract to negotiate is deemed performed and the parties are discharged from their obligations. Failure to agree is not, itself, a breach of the contract to negotiate. A party will be liable only if a failure to reach ultimate agreement resulted from a breach of that party's obligation to negotiate or to negotiate in good faith.

(Id. at 1257.) Here, the language of the February 2014 Agreement demonstrates the agreement was not explicitly a contract to negotiate. Rather, the agreement was an arrangement whereby Agolea did not interfere with Osik's use of the billboards while the parties attempted to negotiate a settlement as long as Osik shared its revenue with Agolea. 'The covenant of good faith and fair dealing, implied by law in every contract, exists merely to prevent one contracting party from unfairly frustrating the other party's right to receive the benefits of the agreement actually made.' (Guz v. Bechtel Nat. Inc. (2000) 24 Cal.4th 317, 349.) The parties did not agree that they had a right to settlement negotiations. The agreement was that Agolea would not interfere with Osik's use of the billboards if certain conditions were met, including an undefined period – during settlement negotiations. While the agreement does not provide a set period of time, it is clear the purpose of the agreement, especially given the surrounding circumstances, was to come to an agreement on lease terms, if possible, to end the parties' disputes. (See SSUMF generally.) Osik points to testimony from Agolea's attorney, Maldonado, who testified that he understood the settlement negotiations were expected to 'be continued in good faith.' (Osik's Additional Material Fact [AMF] No. 34.) Failing to negotiate in good faith could have nullified the benefit of Agloea promising to not interfere – Agolea could have immediately interfered with the billboards if Agolea decided to not negotiate in good faith. In short, the Court finds the terms and surrounding evidence support that the February 2014 Agreement contained an implied covenant of good faith and fair dealing as to negotiating a settlement while the discussions were still occurring. Finally, the La Greca Defendants' assert that the only damages sought are reliance damages. As discussed above, such assertion is not correct.

For the reasons discussed above, the motion is denied as to the Ninth Cause of Action (Breach of Implied Covenant) against Agolea. The motion is granted as to Osik's Eighth Cause of Action (Breach of Written Agreement) and Tenth Cause of Action (Promissory Estoppel). The motion is denied as to the remainder of the motion related to the tortious interference claims.

The parties' requests for judicial notice are granted, to the extent permissible. (See Poseidon Development, Inc. v. Woodland Lane Estates, LLC (2007) 152 Cal.App.4th 1106, 1117; see also Scott v. JPMorgan Chase Bank, N.A. (2013) 214 Cal.App.4th 743, 754.) The Court declines to rule on Osik's objections as they do not conform with the requirements under California Rules of Court, Rule 3.1354. La Greca Defendants' objections 1-13 as to the declaration of Baggett are overruled. La Greca Defendants' objection 1 as to the declaration of Espinosa is overruled.

La Greca Defendants' objections 1-4 as to the declaration of Petralia are overruled.

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