Judge: Robert B. Broadbelt, Case: 21STCV06598, Date: 2022-12-15 Tentative Ruling

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Case Number: 21STCV06598    Hearing Date: December 15, 2022    Dept: 53

Superior Court of California

County of Los Angeles – Central District

Department 53

MOVING PARTY:                Defendant and cross-complainant Dr. Mostafa S. Rahimi

RESPONDING PARTY:       Plaintiff and cross-defendant Jesika Yeroomian

Order to Show Cause re: Preliminary Injunction

The court considered the moving, opposition, and reply papers filed in connection with this motion.

BACKGROUND

Plaintiff Jesika Yeroomian, individually as trustee of the Yeroomian Living Trust dated December 18, 2018, and as trustee derivatively on behalf of Ocean Front Urgent Care P.C. (“Yeroomian”), filed this action on February 18, 2021, against defendant Dr. Mostafa S. Rahimi (“Rahimi”), and nominal defendant Ocean Front Urgent Care P.C. (“Ocean Front”).  Yeroomian filed her operative Second Amended Complaint against Rahimi and nominal defendant Ocean Front on July 29, 2022, alleging 13 causes of action.

On August 11, 2022, Rahimi filed a Cross-Complaint against Yeroomian for declaratory relief determining that Yeroomian’s notice of dissolution of the corporation Ocean Front is ineffectual and void, and that the issuance of the notice of dissolution is not in good faith, and is a nullity.  (Cross-Complaint, filed August 11, 2022, p. 8:20-25.)     

On November 3, 2022, upon the application of Rahimi, the court issued a temporary restraining order prohibiting Yeroomian from taking any further acts, and filing any further papers, with the California Secretary of State to seek a dissolution of the corporation Ocean Front.  The court further ordered Yeroomian to show cause why a preliminary injunction should not be issued against her, prohibiting Yeroomian, and those acting on her behalf, from taking any further acts and filing any further papers with the California Secretary of State to seek a dissolution of the corporation Ocean Front.

EVIDENTIARY OBJECTIONS

The court sustains Rahimi’s evidentiary objections to the declaration of Jesika Yeroomian, filed on December 8, 2022.

DISCUSSION

A preliminary injunction may be granted “[w]hen it appears, during the litigation, that a party to the action is doing, or threatens, or is about to do . . . some act in violation of the rights of another party to the action respecting the subject of the action, and tending to render the judgment ineffectual.”  (Code Civ. Proc., § 526, subd. (a)(3).)  Code of Civil Procedure section 527, subdivision (a) provides:  “A preliminary injunction may be granted at any time before judgment upon a verified complaint, or upon affidavits if the complaint in the one case, or the affidavits in the other, show satisfactorily that sufficient grounds exist therefor.  No preliminary injunction shall be granted without notice to the opposing party.”

“To obtain a preliminary injunction, a plaintiff ordinarily is required to present evidence of irreparable injury or interim harm that it will suffer if an injunction is not issued pending an adjudication of the merits.”  (White v. Davis (2003) 30 Cal.4th 528, 554.)  “A trial court must weigh two interrelated factors when deciding whether to grant a plaintiff’s motion for a preliminary injunction: (1) the likelihood that the plaintiff will prevail on the merits at trial, and (2) the relative interim harm to the parties from the issuance or nonissuance of the injunction, that is, the interim harm the plaintiff is likely to sustain if the injunction is denied as compared to the harm the defendant is likely to suffer if the preliminary injunction is issued. [Citations.]”  (SB Liberty, LLC v. Isla Verde Assn., Inc. (2013) 217 Cal.App.4th 272, 280.)  The burden is on the party seeking injunctive relief to show all the elements necessary to support the issuance of a preliminary injunction.  (O’Connell v. Superior Court (2006) 141 Cal.App.4th 1452, 1481.)

Rahimi presents evidence and argument establishing that (1) Ocean Front did not issue certificates of shares to any person; (2) even if Valod Yeroomian Massihi (“Massihi”) did obtain and transfer shares to Yeroomian, it was in violation of Corporations Code section 13406, since Yeroomian is not a licensed individual; and (3) Ocean Front continues to operate, and remains responsible for the debts and liabilities of its operations, including obligations to its eight employees and its suppliers.  (Rahimi Decl., ¶ 9; Corp. Code, § 13406, subd. (a); Rahimi Decl., ¶¶ 11-12, 14.)  In opposition, Yeroomian argues that Rahimi cannot meet his burden to establish a probability of prevailing on the merits because (1) Massihi transferred his 50 percent interest in Ocean Front to the trust, of which Yeroomian is trustee, such that Yeroomian is permitted to seek dissolution as a shareholder, and (2) Rahimi and Massihi formed a partnership, such that Yeroomian is permitted to seek dissolution as a partner.  (Opp., p. 11:4-10; Yeroomian Decl., Ex. B, p. 6.) 

First, even if Massihi transferred his shares in Ocean Front to the trust, Yeroomian does not address the applicability of Corporations Code section 13406, which (1) requires shares of capital stock in a professional corporation to be issued only to a person who is licensed to render the same professional services; (2) provides that any issuance of shares in violation of this restriction is void; and (3) prohibits a shareholder of a professional corporation to enter into a voting trust, proxy, or any other arrangement vesting another person with the authority to exercise voting power of the shareholder’s shares.  (Corp. Code, § 13406, subd. (a).)  Since Yeroomian does not present evidence establishing that she is a person licensed to render the same professional services, Yeroomian has not established that she is permitted to retain shares in Ocean Front, a professional corporation, pursuant to Corporations Code section 13406. 

Second, Yeroomian does not establish that Ocean Front is a partnership.  “An association organized as another entity (e.g., a corporation) is not a partnership.  (Corp. Code, § 16202, subd. (b).).”  (Eng v. Brown (2018) 21 Cal.App.5th 675, 694.)  Rahimi has presented evidence that Ocean Front is a corporation by submitting a copy of Ocean Front’s Articles of Incorporation, dated December 1, 2011.  (Hyman Decl., Ex. 1 to Ex. 3.)  Accordingly, the evidence submitted in connection with this Order to Show Cause does not establish that Ocean Front is a partnership rather than a corporation.

Upon consideration of the arguments and evidence presented, the court finds that Rahimi has met his burden to show all the elements necessary to support the issuance of a preliminary injunction.  The court finds that Rahimi is likely to prevail on the merits of his Cross-Complaint at trial, and that the relative interim harm to Rahimi from the nonissuance of an injunction will be greater than the interim harm to Yeroomian from the issuance of the injunction.  The court therefore grants Rahimi’s request for preliminary injunction.

ORDER

            The court grants defendant and cross-complainant Mostafa Rahimi’s request for a preliminary injunction. 

The court orders that, during the pendency of this action, plaintiff and cross-defendant Jesika Yeroomian, individually and as trustee of the Yeroomian Living Trust Dated December 18, 2018, and as trustee derivatively on behalf of Ocean Front Urgent Care, P.C., and each of her agents, employees, servants, aiders, abettors, volunteers, successors or assigns, or anyone acting in concert with her or acting on her behalf, are prohibited from taking any further acts, and filing any further papers with the California Secretary of State, to seek a dissolution of the corporation Ocean Front Urgent Care, P.C.

The court orders defendant and cross-complainant Mostafa Rahimi to give notice of this ruling. 

IT IS SO ORDERED.

DATED:  December 15, 2022

_____________________________

Robert B. Broadbelt III

Judge of the Superior Court