Judge: Stephen P. Pfahler, Case: 21CHCV00423, Date: 2022-08-04 Tentative Ruling

Case Number: 21CHCV00423    Hearing Date: August 4, 2022    Dept: F49

Dept. F-49

Date: 8-4-22

Case #21CHCV00423

Trial Date: Not Set

LEAVE TO AMEND

MOVING PARTY:                Plaintiff, Win Partners, LLC

RESPONDING PARTY:       Defendants, World Tech Toys, Inc., et al.

RELIEF REQUESTED

Motion for Leave to File a Second Amended Complaint

SUMMARY OF ACTION

Plaintiff Win Partners, LLC alleges a February 10, 2021, agreement, whereby defendants World Tech Toys, Inc., World Trading 23, Inc., and/or Kevork Kouyoumjian, agreed to deliver certain personal protective equipment (PPE) described as “medical grade disposable seamless rubber gloves.” Plaintiff alleges payment of five million dollars ($5,000,000), but only received non-medical grade, non-FDA approved, “counterfeit” equipment, which lacks any resale value. 

On June 2, 2021, Plaintiff filed a complaint for Breach of Contract, Unfair Business Practices, Breach of Fiduciary Duties, and Fraud. On February 18, 2022, the court granted Plaintiff’s motion for leave to amend. On February 28, 2022, Plaintiff substituted in Jacques Kouyoumhjian for Doe 3. On March 2, 2022, Plaintiff filed a first amended complaint for Breach of Contract, Unfair Business Practices, Breach of Fiduciary Duties, and Fraud.

RULING: Granted.

Evidentiary Objections: Overruled/Declaration Not Relied Upon

Plaintiff Win Partners, LLC movies for leave to file a second amended complaint for Breach of Contract, Unfair Business Practices, Breach of Fiduciary Duties, and Fraud. Plaintiff seeks leave in order to add new factual allegations and deter a potential demurrer threatened against the first amended complaint.

Defendants in opposition claims prejudice as a result of the proposed changes not conforming to the proposed represented changes during talks for the filing of a stipulated pleading. Defendants also challenge the timing in that Defendants represent knew all relevant facts more than a year before the subject motion. Defendant claim significant prejudice will result if the proposed new facts become part of the operative complaint.

Plaintiff in reply contends the opposition contains “irrelevant” argument to the relief sought in the motion. Plaintiff reaffirms the timeliness of the motion, and lack of prejudice, due to the limited discovery. Plaintiff also submits a supplemental declaration denying the accusations in the opposition and restating the status of the action. Finally, Plaintiff submits a counter “motion to strike” portions of the opposition with the evidentiary objections. The “motion to strike” portions of the opposition is denied on grounds of improper and untimely notice.

A motion for leave to amend must comply with the requirements set forth in California Rules of Court Rule 3.1324, which states as follows:

“(a)      Contents of motion

A motion to amend a pleading before trial must:

(1)               Include a copy of the proposed amendment or amended pleading, which must be serially numbered to differentiate it from previous pleadings or amendments;

(2)               State 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

(3)               State 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.

(b)        Supporting declaration

A separate declaration must accompany the motion and must specify:

(1)        The effect of the amendment;

(2)        Why the amendment is necessary and proper;

(3)        When the facts giving rise to the amended allegations were discovered; and

(4)               The reasons why the request for amendment was not made

earlier…” (emphasis added).

Dilatory delays and prejudice to the opposing parties is a valid ground for denial. (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 such as an increased burden of discovery. (Magpali v. Farmers Group, Inc. (1996) 48 Cal.App.4th 471, 486-488.)

Leave to amend is generally liberally granted. (Code Civ. Proc., § 473(a); Mesler v. Bragg Management Co. (1985) 39 Cal.3d 290, 296.) The court will not generally consider the validity of the proposed amended pleading in ruling on a motion for leave, instead deferring such determinations for a demurrer or motion to strike, unless the proposed amendment fails to state a valid claim as a matter of law. (Kittredge Sports Co. v. Sup.Ct. (Marker, U.S.A.) (1989) 213 Cal. App.3d 1045, 1048; California Casualty Gen. Ins. Co. v. Superior Court (1985) 173 Cal.App.3d 274, 280–281 disapproved of on other grounds by Kransco v. American Empire Surplus Lines Ins. Co. (2000) 23 Cal.4th 390.)

The motion, including the declaration of Michael Bennet lacks any specific articulation of the actual changes to the proposed pleading. Defendants emphasize an alleged (potential) agreement, which was apparently never submitted to the court for approval, as a basis for approval. It’s not clear how such an argument in any way bars the subject motion. The court otherwise declines to determine the actual proposed changes, but finds no reason to reject the proposed pleading on this basis, since Defendants apparently understand the proposed changes.

Plaintiff also lacks any specific facts regarding the circumstances for the alleged discovery of “new” facts. Again, Defendants offer strenuous challenge to the veracity of the representation, but it’s not clear how as to what basis Defendants support these factual challenges. The motion was filed on July 6, 2022—more than four months after the March 2, 2022 filing of the first amended complaint to which Defendants neither filed a demurrer nor answered within the normal 30-day window. The representation that the subject proposed amended complaint is presented to stave off a potential demurrer is disingenuous, or at least indicative of further stumbles in negotiations for resolution of this case.

Finally, as stated in the standard above, the court cannot consider the substantive validity of the proposed changes so vociferously challenged by Defendants. The court therefore declines to consider any and all such factual based arguments, and instead reminds the parties of the 30-day window for a responsive pleading upon the filing of a new complaint or cross-complaint.

Ultimately, other than the apparently contentious relationship between counsel and the parties, nothing in the opposition otherwise presents a valid basis of prejudice as a result of the timing of the motion. No trial date is set, and the parties have apparently only completed limited discovery. The court rejects Plaintiffs request for any conditions on discovery.

The motion is therefore granted. Plaintiff is ordered to file the second amended complaint within 10 days of this order.

Plaintiff to give notice.