Judge: Teresa A. Beaudet, Case: 20STCV42478, Date: 2022-09-13 Tentative Ruling

Case Number: 20STCV42478    Hearing Date: September 13, 2022    Dept: 50

Superior Court of California

County of Los Angeles

Department 50

            Background

On November 5, 2020, Plaintiff Gerry Spence (“Plaintiff”) filed this action against Defendants James R. Clary (aka J.R. Clary), John Sloan, Dana Cole, and Milton Grimes (“Grimes”) (collectively, “Defendants”). The Complaint alleges causes of action for (1) fraud, (2) conversion, (3) breach of fiduciary duty, (4) negligent misrepresentation, (5) intentional infliction of emotional distress, and (6) elder financial abuse.

On April 16, 2021, an Order was filed in this action in which the Court granted Grimes’s

motion to stay or dismiss the case. As set forth in the Order, Grimes filed the motion due to a separate action pending before the United States District Court for the District of Wyoming (the “Wyoming Action”) which Grimes contended had substantially overlapping claims and identical parties.[1] This Court’s April 16, 2021 Order indicates, inter alia, that, “the motion is granted and this action is stayed pending resolution of the Wyoming Action.”

Plaintiff now moves for an order lifting the stay imposed in this action[2] and setting the matter for trial within 120 days of the date of the order. Grimes opposes. 

            Requests for Judicial Notice

            The Court grants Plaintiff’s request for judicial notice. The Court also grants Grimes’s request for judicial notice. 

Discussion

The parties provide a procedural background regarding the Wyoming Action. The original complaint in the Wyoming Action was filed on May 13, 2020. (Gilbert Decl., ¶ 2, Ex. B.) The operative Third Amended Verified Complaint in the Wyoming Action was filed on October 26, 2021. (Gilbert Decl., ¶ 2, Ex. A.) The Third Amended Verified Complaint was brought by Plaintiff The Trial Lawyers College (“TLC”) against Defendants Gerry Spences Trial Lawyers College at Thunderhead Ranch, Gerald L. Spence, John Zelbst, Rex Parris, Joseph H. Low, Kent Spence, John Joyce, Daniel Ambrose, and Gerry Spence Method at Thunderhead Ranch, Inc. (Ibid.)

 On November 16, 2021, Defendants Gerry Spence Trial Institute (f/k/a Gerry Spence’s Trial Lawyers College at Thunderhead Ranch), Gerald L. Spence, John Zelbst, R. Rex Parris, Joseph H. Low, Kent Spence, and Gerry Spence Method at Thunderhead Ranch, Inc. filed an Answer to TLC’s Third Amended Complaint and asserted Counterclaims and Third-Party Claims. (Gilbert Decl., ¶ 7, Ex. G.) The Counterclaims and Third-Party Claims were asserted against TLC, John Sloan, Milton Grimes, Maren Chaloupka, James R. Clary Jr., Dana Cole, and Anne Valentine. (Ibid., p. 30.) 

On March 29, 2022, the United States District Court for the District of Wyoming issued a Memorandum of Opinion and Order Granting Plaintiff and Third-Party Defendants’ Motion to Dismiss Counterclaims and Third-Party Claims. (Gilbert Decl., ¶ 8, Ex. H.) On February 2, 2022, the United States District Court for the District of Wyoming issued a Third Scheduling Order which provides, inter alia, that a jury trial in the Wyoming Action is scheduled to begin on October 11, 2022. (Gilbert Decl., ¶ 9, Ex. I.) 

Plaintiff argues that because the United States District Court for the District of Wyoming issued the March 29, 2022 Order granting Plaintiff and Third-Party Defendants’ Motion to Dismiss Counterclaims and Third-Party Claims, the Court here should lift the stay in the instant action. Grimes counters that the dismissal of the third-party defendants in the Wyoming Action does not remove its similarity to this action, and that the substantive claims presented in this action are already at issue in the Wyoming Action.

First, as to the similarity of the parties, the Court’s Order filed on April 16, 2021 provides, inter alia, that “[a]ll parties to this action are also parties to the Wyoming Action. Plaintiff has been a defendant in the Wyoming federal action since it commenced on May 13, 2020…Defendants were named as third-party defendants by Plaintiff in the Wyoming Action on October 21, 2020.” Plaintiff is still a defendant in the operative Third Amended Verified Complaint in the Wyoming Action (Gilbert Decl., ¶ 2, Ex. A.), but as Grimes acknowledges, the third-party claims have been dismissed.

As an initial matter, the Court notes that Plaintiff references a transcript of this Court’s April 16, 2021 hearing for the first time in the reply in support of the argument that the stay should be lifted. Although a copy of the transcript was not provided in connection with reply (or the motion), Plaintiff contends that “[t]he Court made clear at the time of the April 16 hearing that the Court’s decision ‘would be a different story’ if Mr. Spence ‘didn’t have those cross-actions there.’” (Reply at p. 1:9-11, citing to April 16, 2021 hearing transcript.) Plaintiff also raises a number of other arguments for the first time in the reply.

Grimes has not had the opportunity to address the points raised for the first time in Plaintiff’s reply. (See American Drug Stores, Inc. v. Stroh (1992) 10 Cal.App.4th 1446, 1453, “[p]oints raised for the first time in a reply brief will ordinarily not be considered, because such consideration would deprive the respondent of an opportunity to counter the argument.”) However, in light of the assertions made by Plaintiff in the reply, the Court will continue the hearing on the instant motion.

The Court orders Plaintiff to file and serve a copy of the April 16, 2021 hearing transcript referenced in the reply on or before ____________, 2022. The Court will permit Grimes to file and serve a surreply on or before ____________, 2022. The hearing on this motion will be continued to ___________, 2022 at 10:00 a.m. in Dept. 50. 

Plaintiff is ordered to give notice of this Order.

DATED:  September 13, 2022                                  

________________________________

Hon. Teresa A. Beaudet

Judge, Los Angeles Superior Court