Judge Salvatore Sirna, Case Number: 19PSCV01160, Date: 2023-05-25 Tentative Ruling

Judge: Salvatore Sirna, Case: 19PSCV01160, Date: 2023-05-25 Tentative Ruling

The Court may change tentative rulings at any time. Therefore, counsel are advised to check this website periodically to determine whether any changes or updates have been made to the tentative ruling. Counsel may submit on a tentative ruling by calling the clerk in Department G at (909) 802-1104 prior to 8:30 a.m. the morning of the hearing.

Case Number: 19PSCV01160 Hearing Date: March 26, 2024 Dept: G

Plaintiff Mohammed Khodabakhsh’s Application for Default Judgment

Respondent: NO OPPOSITION (Court struck Defendant’s Answer on September 22, 2022)

TENTATIVE RULING

Plaintiff Mohammed Khodabakhsh’s Application for Default Judgment is TENTATIVELY GRANTED pending Khodabakhsh’s filing of proof of service of the unredacted expert report of Dr. Joseph Smith on Defendant Terry Vechick’s Counsel.

BACKGROUND

This is an action between two former business partners. Plaintiff Mohammed Khodabakhsh is an engineer and inventor in the clean energy technology field. Defendant Terry L. Vechik is a marketer of inventions. In 2008, Khodabakhsh began working with Vechik to help monetize clean energy technology developed by Khodabakhsh. Subsequently, Khodabakhsh alleges Vechik began falsely claiming to be an equal partner in Khodabakhsh’s work. Khodabakhsh then claims Vechik took a laptop computer and flash drive from Khodabakhsh that contained designs, drawings, and marketing materials for Khodabakhsh’s technology and refused to return it. When Khodabakhsh confronted Vechik about the laptop computer and flash drive, Khodabakhsh alleges Vechik threatened to kill Khodabakhsh. After that, Khodabakhsh claims a mutual friend informed Khodabakhsh that Vechik told the friend how Vechik was going to kill Khodabakhsh. Another friend informed Khodabakhsh that Vechik had offered the friend money to conduct surveillance on Khodabakhsh and inform Vechik of Khodabakhsh’s whereabouts.

On December 30, 2019, Khodabakhsh filed a complaint against Vechik; Rudd Koekkoek, also known as Rudoph Koekkoek; Matchcorp Fin. Services BV; Rene Aemig; Hyperion Capital; Ali Mir Zadeh; Vesten Food Concept AG, Hofstr. 2 CH 6004; and Does 1-25, alleging the following causes of action: (1) declaratory relief, (2) injunctive relief, and (3) conversion.

On September 30, 2020, Khodabakhsh filed a First Amended Complaint (FAC) against Vechik and Does 1-25, alleging the following causes of action: (1) conversion, (2) violation of the California Data Access and Fraud Act, (3) intentional interference with prospective economic advantage, (4) misappropriation of trade secrets, (5) violation of Penal Code section 496, (6) intentional infliction of emotional distress (IIED), and (7) violations of Business and Professions Code section 17200.

On September 22, 2022, after Vechik repeatedly refused to comply with discovery orders by the court and pay sanctions, the court granted Khodabakhsh’s request to impose terminating sanctions on Vechik and struck Vechik’s answer.

On October 26, 2022, default was entered against Vechik. On January 4, 2023, Khodabakhsh applied for a default judgment that the court denied without prejudice on January 10. On January 26, Khodabakhsh filed a second application for default judgment that the court again denied without prejudice on February 2. On March 16, Khodabakhsh filed a third application for default judgment that the court granted on March 23. On July 3, the court granted a motion by Vechik to vacate the default judgment.

On October 10, 2023, Khodabakhsh filed a fourth application for default judgment that the court granted on October 20. On January 10, 2024, the court granted a motion by Vechik to vacate the default judgment.

On February 22, 2024, Khodabakhsh filed the present application for default judgment and also applied for an application for file the expert report of Joseph Smith under seal.

An OSC Re: Default Judgment is set for March 26, 2024.

LEGAL STANDARD

Code of Civil Procedure section 585 permits entry of a default judgment after a party has filed to timely respond or appear. A party seeking judgment on the default by the court must file a Request for Court Judgment, and: (1) a brief summary of the case; (2) declarations or other admissible evidence in support of the judgment requested; (3) interest computations as necessary; (4) a memorandum of costs and disbursements; (5) a proposed form of judgment; (6) a dismissal of all parties against whom judgment is not sought or an application for separate judgment under CCP § 579, supported by a showing of grounds for each judgment; (7) exhibits as necessary; and (8) a request for attorneys’ fees if allowed by statute or by the agreement of the parties. (Cal. Rules of Court 3.1800.)

ANALYSIS

Application to Seal Records

As an initial matter, Khodabakhsh seeks leave to file the expert report of Dr. Joseph Smith under seal pursuant to a stipulated protective order entered on April 28, 2022. (LeJeune Decl., Ex. B.) Pursuant to the protective order, documents may be deemed “Highly Confidential – Attorneys’ Eyes Only” if the possessing party believes in good faith that the information contains the following:

“Documents, Testimony, or Information consists of extremely sensitive confidential, or proprietary information or tangible things, such as technical know-how and trade secrets, relating to: (1) information relating to manufacturing processes or procedures with respect to devices or other products that are commercially released or for which substantial steps have been taken towards commercialization; or (2) information generated by research and development activities.; or (3) information that otherwise derives independent economic value, actual or potential, from not being generally known to the public or to other persons who can obtain economic value from its disclosure or use. The disclosure of ‘HIGHLY CONFIDENTIAL – ATTORNEYS’ EYES ONLY’ to another Party or Non-Party would create a substantial risk of serious harm that could not be avoided by less restrictive means.” (LeJeune Decl., Ex. B, ¶ H.)

Based upon this definition, the court finds Dr. Smith’s declaration qualifies for the designation as it contains detailed descriptions of Khodabakhsh’s alleged trade secrets and disclosure to the public or other parties could result in a substantial risk of serious financial harm to Khodabakhsh. Accordingly, Khodabakhsh’s motion to file the expert declaration of Dr. Smith under seal pursuant to the protective order entered April 28, 2022, is GRANTED.

To the extent Khodabakhsh failed to serve unredacted copies of Dr. Smith’s report on Vechik’s counsel, the court finds Vechik’s counsel is entitled to the report pursuant to the protective order. Accordingly, Khodabakhsh is ordered to serve a unredacted copy of Dr. Smith’s report to Vechik’s counsel and file a proof of service with the court.

Default Judgment

Khodabakhsh seeks default judgment against Vechik in the total amount of $8,064,542.30, including $7,000,000 in damages, $1,013,557.30 in interest, and $50,985 in attorney fees. Upon reviewing Khodabakhsh’s application, the court finds it cures the defects raised in the court’s January 10, 2024 ruling.

First, the court previously found that the declaration of Richard M. Holstrom relied on an unauthenticated and unsigned “Economic Valuation Assessment” (FES Report) of Khodabakhsh’s ‘907 Patent that had been prepared by Forensic Economic Services and provided by Khodabakhsh’s counsel. (1/10/2024 Ruling, p. 3.) Here, Khodabakhsh has provided a signed copy of the report. (Garagulagian Decl.)

Second, the court previously found that Khodabakhsh failed to demonstrate the allegedly misappropriated trade secrets were necessary for the implementation of the ‘907 Patent. (1/10/2024 Ruling, p. 3.) In the previously submitted expert report by Dr. Smith, the court found Dr. Smith made general statements about trade secrets, but failed to specifically state if the trade secrets that Vechik allegedly misappropriate were necessary for the ‘907 Patent’s implementation. (1/10/2024, p. 3.) While Dr. Smith provided a list of the trade secrets at issue, the court found Dr. Smith failed to detail how each trade secret was necessary for the implementation of the ‘907 Patent. Instead, Dr. Smith appeared merely to rely on Khodabakhsh’s assertions. (1/10/2024, p. 3.)

With this submission, Khodabakhsh filed an updated expert report by Dr. Smith under seal. In it, Dr. Smith provided further detail by explaining how specific trade secrets were essential to the proper implementation and operation of the hydrogen generator detailed in the ‘907 Patent. (Dr. Smith Decl., p. 22.) In particular, Dr. Smith identifies trade secret numbers 2-5, 7-14, and 19-24 as the key trade secrets that were essential to the implementation and operation of the hydrogen generator and E-F generator. (Dr. Smith Decl., p. 22.) Based upon the evidence submitted, the court GRANTS Khodabakhsh’s application for default judgment.

CONCLUSION

Based on the foregoing, Khodabakhsh’s application for default judgment is TENTATIVELY GRANTED pending Khodabakhsh’s filing of proof of service of the unredacted expert declaration of Dr. Smith on Vechik’s counsel.