Judge Salvatore Sirna, Case 21PSCV00585 2023-02-28 Tentative Ruling

Judge: Salvatore Sirna, Case: 21PSCV00585, Date: 2023-02-28 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 the tentative rulings by calling the clerk in Department G at (909) 802-1104 prior to 8:30 a.m. the morning of the hearing.

Case Number: 21PSCV00585 Hearing Date: February 28, 2023 Dept: G

Plaintiff Michael Hashemian’s Motion for Leave to File First Amended Complaint

Respondent: Defendant Hassan Hashemian

TENTATIVE RULING

Plaintiff Michael Hashemian’s Motion for Leave to File a First Amended Complaint is GRANTED. The First Amended Complaint is deemed filed as of the date of the hearing (February 28, 2023).

BACKGROUND

This is a contractual fraud action. Plaintiff Michael Hashemian and Defendant Hassan Hashemian are cousins. Plaintiff alleges Defendant bragged about being a successful stockbroker and investor. In January 2016, Defendant invited Plaintiff to participate in an investment competition in which competitors would invest $1,000,000 over a year with a $100,000 reward for the investor with the highest gain. Plaintiff agreed to provide $1,000,000 to Defendant for Defendant to invest in the competition and wired the money to Defendant on February 1, 2016.

During the course of the year, Plaintiff alleges Defendant gave positive but vague updates on the investment account. After one year, Defendant allegedly informed Plaintiff that Defendant did not win the competition but convinced Plaintiff to keep the funds in the investment account as the investment was still allegedly doing well. After Plaintiff asked Defendant to close the investment account and return the money on April 29, 2019, Defendant informed Plaintiff that the investment account was empty and that Plaintiff’s money had been wiped out in the stock market. In a phone conversation on May 9, 2021, Defendant allegedly suggested to Plaintiff that Defendant could make up for the lost investment if Plaintiff invested an additional $500,000 with Defendant. Around this time, Plaintiff alleges Plaintiff discovered Defendant was misusing and mismanaging Plaintiff’s investment funds.

On July 20, 2021, Plaintiff filed a complaint against Defendant, Shokufeh Mostofi (Mostofi), and Does 1-20, alleging the following causes of action: (1) breach of contract, (2) breach of fiduciary duty and undivided loyalty, (3) breach of covenant of good faith and fair dealing, (4) fraud, (5) conspiracy, (6) conversion, (7) negligent misrepresentation, (8) negligence, (9) unfair business practices, and (10) intentional infliction of emotional distress.

On November 17, 2021, Defendant and Mostofi demurred to Plaintiff’s complaint. On January 14, 2022, the court sustained the demurrer with leave to amend.

On June 8, 2022, Plaintiff moved to compel Defendant’s responses to Plaintiff’s first set of special interrogatories. On July 22, the court granted Plaintiff’s motion and ordered Defendant to provide responses. On October 10, Plaintiff filed a motion to compel compliance.

On December 16, 2022, Defendant filed an answer to Plaintiff’s complaint. On January 26, 2023, Plaintiff filed the present motion. A hearing on the motion and OSC Re: Mediation Completion are set for February 28. A hearing on the motion to compel compliance is set for May 4. A final status conference is also set for April 10, 2024, along with a jury trial on April 23, 2024.

ANALYSIS

Plaintiffs seek leave to file a First Amended Complaint (FAC) that removes the fifth cause of action for conspiracy and Mostofi as a defendant while adding a tenth cause of action for constructive trust and eleventh cause of action for violation of Penal Code section 496, subdivision (a).

For the following reasons, the court finds good cause to permit the filing.

Legal Standard

“A court may, in furtherance of justice, and on any terms as may be proper, allow a party to amend any pleading.” (Code Civ. Proc., § 473, subd. (a)(1).) The court’s discretion will usually be exercised liberally to permit amendments of the pleadings. (Nestle v. City of Santa Monica (1972) 6 Cal.3d 920, 939.)¿“A motion to amend a pleading before trial must . . . [s]tate what allegations in the previous pleading are proposed to be deleted, if any, and where, by page, paragraph, and line number, the deleted allegations are located; and [s]tate what allegations are proposed to be added to the previous pleading, if any, and where, by page, paragraph, and line number, the additional allegations are located.”¿ (Cal. Rules of Court, rule 3.1324(a).)¿ The declaration must also specify the amendment’s effect, why it is necessary and proper, when the facts supporting the amended allegations were discovered, and why the request was not made earlier.¿ (Cal. Rules of Court, rule 3.1324(b).)

If the party seeking the amendment has needlessly delayed, and the delay has prejudiced the opposing party, the court has the discretion to deny leave to amend.¿ (See Hirsa v. Superior Court (1981) 118 Cal.App.3d 486, 490.)¿ Prejudice exists where the amendment would require delaying the trial, resulting in loss of critical evidence, or added costs of preparation.¿ (Solit v. Tokai Bank, Ltd. New York Branch (1999) 68 Cal.App.4th 1435, 1448.)

Discussion

Plaintiff’s counsel provides that the effect of the amendment is to add causes of action for constructive trust and violation of Penal Code section 496, subdivision (a) based on the same allegations alleged in the Complaint. (Whitmer-Cabrera Decl., ¶ 3-4.) Plaintiff’s counsel argues this is necessary and proper based on documents provided in December 2022 discovery responses, including a Wells Fargo Home Loan Application that Defendant submitting claiming Plaintiff’s investment account belonged to Defendant as well as Defendant’s responses to Form Interrogatories and Requests for Admission. (Whitmer-Cabrera Decl., ¶ 5-6.) Plaintiff’s counsel argues the amendment is necessary and proper to allow Plaintiff to recover all damages suffered in this action. (Whitmer-Cabrera Decl., ¶ 7.) The court finds Plaintiff’s counsel has submitted a declaration sufficient to support amendment and now considers any prejudice to Defendant.

Defendant argues allowing Plaintiff’s amendment would be prejudicial because (1) the proposed amended complaint raises new issues and defenses that require additional discovery and (2) it has been over eighteen months since Plaintiff filed the first complaint.

However, the court notes it granted a motion to compel Defendant’s responses to Plaintiff’s first set of special interrogatories in July 2022. Additionally, Plaintiff filed another motion to compel compliance with the court’s discovery order in October. Plaintiff did not receive evidence of Defendant’s Wells Fargo Bank loan application until December 2022. (Whitmer-Cabrera Decl., ¶ 5.) Defendant’s responses to Plaintiff’s form interrogatories were verified October 11 while Defendant’s responses to requests for admission were verified on November 8. (Whitmer-Cabrera Decl., Ex. B, C.)

Accordingly, the court finds any prejudice to Defendant is minimal. In light of the policy of liberally granting leave to amend, the court GRANTS Plaintiff’s motion.

CONCLUSION

Based on the foregoing, Plaintiff’s motion for leave to file a FAC is GRANTED and the FAC attached as Exhibit D to declaration of Plaintiff’s counsel is deemed filed as of this date.