Judge: Robert S. Draper, Case: 20STCV13469, Date: 2022-09-06 Tentative Ruling

Case Number: 20STCV13469    Hearing Date: September 6, 2022    Dept: 78

Superior Court of California 

County of Los Angeles 

Department 78 

Plaintiffs’ Motion to Continue Trial is GRANTED.

FACTUAL BACKGROUND

This is an action for breach of fiduciary duty and constructive fraud. The Second Amended Complaint (“SAC”) alleges as follows. Plaintiffs Serpouhie Sarkissian (“Sue”) and Jirair Sarkissian (“Jirair”) are a married couple who were close friends with a family, Defendants Antranik Baghdassarian (“Antranik”), Ohan Baghdassarian (“Ohan”), Rostom Baghdassarian (“Rostom”), and Tsolak Khatcherian (“Tsolak”). (SAC ¶¶ 12-14.)

In September 1998, Antranik asked Sue for $350,000 to grow his cheese business and sent a letter though his attorneys which proposed an investment for Plaintiffs of 10% of the corporation. (SAC ¶¶ 16-17.) In October 1998, Plaintiffs sent $25,000, and in December 1998 sent $100,000 in two $50,000 payments. (SAC ¶ 18.) Letters between the parties in December 1998 and January 1999 reflect an investment whereby Plaintiffs would invest $350,000 in exchange for a 50% interest in the production facility and 10% in the cheese company (“Karoun”). (SAC ¶ 19.)

By March 1999, Plaintiffs advanced a total of $350,000 without a formal agreement but with an understanding of the investment. (SAC ¶ 23.) In March 2000, the parties entered into a formal agreement, which stated that Plaintiffs gave a loan of $348,000 at 10% interest payable by April 1, 2002, and $2,000 invested in a second cheese company, Central Valley Cheese Co. (“CVC”) reflecting a 10% equity interest. (SAC ¶ 26.)

In October 2000, Plaintiffs loaned another $100,000 and received a promissory note from CVC. (SAC ¶ 33.)

In May 2002, Plaintiffs’ business guaranteed a $100,000 loan to Karoun and a $150,000 loan to CVC. (SAC ¶ 34.) CVC repaid the loans. (SAC ¶ 36.)

The Plaintiffs stopped receiving dividends from CVC by 2002. (SAC ¶ 37.) In April 2017, Defendants informed Plaintiffs that CVC was being sold, and it turned out that Karoun was being sold, too. (SAC ¶¶ 45-47.) Plaintiffs’ 10% equity interest yielded $1 million while defendants’ interest was sold for $130 million. (SAC ¶ 49.) Plaintiffs contend that Defendants depressed the price of the CVC cheese to ensure that shared profits of the two companies were allocated to Karoun. (SAC ¶ 54.)

PROCEDURAL HISTORY

Plaintiffs filed the Complaint on April 6, 2020, alleging eleven causes of action:

1.    Breach of fiduciary duty;

2.    Constructive fraud;

3.    Fraud;

4.    Conspiracy to breach fiduciary duty;

5.    Aiding and abetting breach of fiduciary duty;

6.    Conspiracy to commit constructive fraud;

7.    Aiding and abetting constructive fraud;

8.    Conspiracy to commit fraud;

9.    Aiding and abetting fraud;

10.                   Contractual breach of the implied covenant of good faith

11.                   Tortious breach of the implied covenant of good faith

On September 14, 2020, Plaintiffs filed the FAC, alleging the same causes of action.

On February 24, 2021, this Court sustained Defendants’ Demurrer to the FAC with leave to amend, as to all causes of action. The Court denied Defendants’ Motion to Strike as moot.

On March 15, 2021, Plaintiffs filed the SAC, alleging the same causes of action.

On April 14, 2021, Defendants filed a Demurrer to the SAC.

On July 19, 2021, the Court overruled the Demurrer to the SAC.

On August 10, 2022, Plaintiffs filed the instant Motion to Continue Trial Date.

On August 19, 2022, Defendants filed an Opposition.

On August 29, 2022, Plaintiffs filed a Reply.

DISCUSSION 

I.               MOTION TO CONTINUE TRIAL

Plaintiffs move to continue trial until May 2023 or after. Trial is currently set for November 15, 2022.

Pursuant to California Rules of Court, rule 3.1332, subdivision (a), “[t]o ensure the prompt disposition of civil cases, the dates assigned for a trial are firm.¿ All parties and their counsel must regard the date set for trial as certain.”¿ Under California Rules of Court, rule 3.1332, subdivision (b), “[a] party seeking a continuance of the date set for trial, whether contested or uncontested or stipulated to by the parties, must make the request for a continuance by a noticed motion or an ex¿parte¿application under the rules in chapter 4 of this division, with supporting declarations.¿ The party must make the motion or application as soon as reasonably practical once the necessity for the continuance is discovered.”¿ 

 California Rules of Court, rule 3.1332, subdivision (c) states that “[a]lthough¿continuances of trials are disfavored, each request for a continuance must be considered on its own merits.¿ The court may grant a continuance only on an affirmative showing of good cause requiring the continuance.”¿ California Rules of Court, rule 3.1332, subdivision (d) sets forth factors that are relevant in determining whether to grant a continuance.¿ 

Here, Plaintiffs initially sought to continue trial for two reasons. First, because Plaintiff Jirair Sarkissian had fallen very ill while visiting Armenia, and would be unable to return in time for trial. (Brownlie Decl. ¶ 3.) His children flew to Armenia to join their father. (Ibid.)

Second, because Plaintiff’s counsel has unavoidable scheduling conflicts related to other clients that preclude Plaintiff’s Counsel from completing discovery and preparing the instant case for trial by the current date. (Brownlie Decl. ¶¶ 4-7.) Plaintiff’s Counsel has a four-day arbitration in September 2022 and a three-week multi-party arbitration in December 2022. (Ibid.)

Plaintiffs note that this is the first tike either party has sought a continuance, and that they have otherwise prosecuted the case diligently. (Brownlie Decl. ¶ 11.)

Originally in Opposition, Defendants cast doubt on Plaintiffs’ reasons for continuance. Defendants argued that this trial can simply trail any conflicting trial, and that there is still adequate time for Plaintiff’s Counsel to complete discovery in the remaining two months. Additionally, Defendants contended that when Plaintiff’s Counsel was asked to provide documentation of Jirair’s illness, Plaintiffs provided heavily redacted documents that failed to justify the extension. (Braun Decl. at ¶¶ 2-6.)

However, in Reply, Plaintiffs state that Jirair passed away after the filing of the instant Motion. Additionally, on September 1^, Defendants filed a Notice of Non-Opposition stating that due to Jirair’s passing, Defendants withdrew their Opposition and agree a reasonable adjustment to the trial schedule.

The Court finds that Plaintiff Jirair Sarkissian’s passing, and his family’s necessary arrangements due to his passing, constitute good cause to continue trial. And, as Plaintiff has otherwise pursued the claim diligently and has not requested other continuances, the Court finds the continuance will cause minimal prejudice to Defendants.

Accordingly, Plaintiffs’ Motion to Continue Trial is GRANTED. The new trial date will be determined at hearing.

DATED:  September 6, 2022

___________________________

Hon. Robert S. Draper 

Judge of the Superior Court