Judge Teresa A. Beaudet, Case 21STCV45128 2023-02-24 Tentative Ruling

Plaintiff Canico Capital Group, LLC (“Plaintiff”) filed this action on December 10, 2021 against Defendants Avraham Hassid, Ladan Hassid, Tal Hassid, Nasser Saghian (“Saghian”), Igal Javdanfar (“Javdanfar”), and Yousef Eshtiaghpour (“Eshtiaghpour”) (collectively, “Defendants”). The Complaint asserts causes of action for (1) violation of Civil Code section 2941, (2) violation of Civil Code section 2943, and (3) declaratory relief.

In the Complaint, Plaintiff alleges that it holds a judgment that was entered on August 10, 2012, against Avraham Hassid in the amount of $375,000.00 in the action entitled Canico Capital Group, LLC v. Avraham Hassid, et al., Los Angeles County Superior Court, Northwest District, Case No. LC086703 (the “Van Nuys Judgment”). (Compl., ¶ 9.) The Van Nuys Judgment was renewed on March 10, 2021, in the amount of $696,915.74. (Ibid.)

Plaintiff also holds a judgment that was entered on May 3, 2012, against Avraham Hassid in the amount of $1,680,286.80 in the action entitled Canico Capital Group, LLC v. Olympic 2000 Investments Group, LLC, et al., Los Angeles County Superior Court, West District, Case No. SS022245 (the “Santa Monica Judgment”). (Compl., ¶ 11.) The Santa Monica Judgment was renewed on March 15, 2021, in the amount of $2,641,040.46. (Ibid.)

On December 4, 2012, Plaintiff caused to be recorded an abstract of the Van Nuys Judgment, and on September 28, 2012, Plaintiff caused to be recorded an abstract of the Santa Monica Judgment. (Compl., ¶¶ 10, 12.) Based upon the recordation of the Van Nuys abstract and the Santa Monica abstract, judgment liens in favor of Plaintiff attached to the real property owned by Avraham Hassid and Ladan Hassid, husband and wife as joint tenants, which is commonly known as 309 Foothill Road, Beverly Hills, CA 90210-4926 (the “Property”). (Compl., ¶ 13.)

Plaintiff alleges that several deeds of trust were recorded against the Property. First, Plaintiff alleges a deed of trust was recorded against the Property on September 11, 2012, securing a purported $750,000.00 obligation to Saghian (the “Saghian Deed of Trust”). (Compl., ¶ 14.) Second, Plaintiff alleges a deed of trust was recorded against the Property on June 5, 2009, securing a purported $500,000.00 obligation to Javdanfar. (Compl., ¶ 18.) Third, Plaintiff alleges that a deed of trust was recorded against the Property on September 11, 2012, securing a purported $1,216,833.00 obligation to Eshtiaghpour. (Compl., ¶ 21.) Fourth, Plaintiff alleges that a deed of trust was recorded against the Property on October 31, 2014, securing a purported $300,000.00 obligation to Tal Hassid. (Compl., ¶ 25.)

Plaintiff alleges that “[i]n violation of California Civil Code section 2941, Defendants Nasser Saghian, Igal Javdanfar, Yousef Eshtiaghpour and Tal Hassid each have failed to record a certificate of discharge and reconveyances of their above-described respective Deeds of Trust, even though the purported obligations secured by those Deeds of Trust have been satisfied in full and/or never existed. As a result, those Deeds of Trust remain a cloud on title to the Property.” (Compl., ¶ 32.) Plaintiff further alleges that “[a] dispute has arisen between Canico and Defendants regarding whether the purported obligations secured by the Deeds of Trust of Defendants Nasser Saghian, Igal Javdanfar, Yousef Eshtiaghpour and Tal Hassid against the Property have been paid in full (or ever existed) and remain valid liens against the Property.” (Compl., ¶ 38.)

On November 10, 2022, the Court issued an order granting Plaintiff’s ex parte application for a TRO and order to show cause re: preliminary injunction. In addition, on November 10, 2022, a Temporary Restraining Order and Order to Show Cause Re: Preliminary Injunction was issued. The November 10, 2022 Order to Show Cause provides that “[a] hearing is set for 1/30/2023…on the Court’s Order to Show Cause. Defendant is hereby ordered to show cause why Defendant and his representatives, employees and agents should not continue to be enjoined by a preliminary injunction by this Court from conducting a trustee’s sale of the Property pursuant to the Deed of Trust pending entry of judgment in this action or further order of this Court. Any response by Defendant to this Order to Show Cause shall be filed with the Court and served by electronic service on Plaintiff’s counsel by 5:00 p.m. per Code. Any reply by Plaintiff in support of a preliminary injunction shall be filed with the Court and served by electronic service on Defendant’s counsel by 5:00 p.m. per Code.”

On February 8, 2023, the Court issued a minute order providing, inter alia, that “[t]he hearing on the Preliminary Injunctions is set as follows: Order to Show Cause Re: Re: [sic] Preliminary Injunction is scheduled for 02/24/23…The opposition must be filed and served on or before February 10, 2023. The reply must be file an [sic] served on or before February 17, 2023.” On February 10, 2023, Defendants filed an opposition to Plaintiff’s request for preliminary injunction, and on February 17, 2023, Plaintiff filed a reply.[1]

The Court rules on Plaintiff’s evidentiary objections to the Declaration of Tal Hassid as follows:

Objection No. 3 (concerning paragraph 8): sustained as to “[g]iven the litigation history between these parties, and the likely fees and costs to accrue, a bond of at least $3 million should be required in order to protect me from potential harm caused by Canico’s actions related to the TRO and the potential sheriff’s sale while I am restrained from foreclosing on the note,” overruled as to the remainder.

The Court rules on Plaintiff’s evidentiary objections to the Declaration of Nasser Saghian as follows:

The Court rules on Plaintiff’s evidentiary objections to the Declaration of Daniel Y. Zohar as follows:

The Court rules on Plaintiff’s evidentiary objections to the Declaration of Joshua P. Friedman as follows:

“In determining whether to issue a preliminary injunction, the trial court considers two related factors: (1) the likelihood that the plaintiff will prevail on the merits of its case at trial, and (2) the interim harm that the plaintiff is likely to sustain if the injunction is denied as compared to the harm that the defendant is likely to suffer if the court grants a preliminary injunction.” (Donahue Schriber Realty Group, Inc. v. Nu Creation Outreach (2014) 232 Cal.App.4th 1171, 1177 [internal quotations omitted].) “[A]n order granting or denying a preliminary injunction does not amount to an adjudication of the ultimate rights in controversy. Its purpose is to preserve the status quo until the merits of the action can be determined.” (White v. Davis (2003) 30 Cal.4th 528, 554 [emphasis omitted].) “The trial court’s determination must be guided by a ‘mix’ of the potential-merit and interim-harm factors; the greater the plaintiff’s showing on one, the less must be shown on the other….” (Church of Christ in Hollywood v. Superior Court (2002) 99 Cal.App.4th 1244, 1251-1252.) “The ultimate goal of any test to be used in deciding whether a preliminary injunction should issue is to minimize the harm which an erroneous interim decision may cause.” (White v. Davis, supra, at p. 554 [emphasis omitted].) The burden is on the party seeking injunctive relief to show all elements necessary to support issuance of a preliminary injunction. (O'Connell v. Superior Court (2006) 141 Cal.App.4th 1452, 1481.)

A preliminary injunction must not issue unless it is “reasonably probable that the moving party will prevail on the merits.” (San Francisco Newspaper Printing Co. v. Superior Court (Miller) (1985) 170 Cal.App.3d 438, 442.) The “likelihood of success on the merits and the balance-of-harms analysis are ordinarily ‘interrelated’ factors in the decision whether to issue a preliminary injunction.” (White v. Davis, supra, 30 Cal.4th at p. 561.) “The presence or absence of each factor is usually a matter of degree, and if the party seeking the injunction can make a sufficiently strong showing of likelihood of success on the merits, the trial court has discretion to issue the injunction notwithstanding that party’s inability to show that the balance of harms tips in his favor.” (Ibid.) However, this does not mean that a trial court may grant a preliminary injunction on the basis of the likelihood-of-success factor alone when the balance of hardships dramatically favors denial of a preliminary injunction. (Ibid.)

As set forth above, Plaintiff’s Complaint asserts causes of action for (1) violation of Civil Code section 2941, (2) violation of Civil Code section 2943, and (3) declaratory relief. Plaintiff’s October 10, 2022 Ex Parte Application For Temporary Restraining Order and Order to Show Cause Re: Preliminary Injunction (the “Ex Parte Application”) concerns the third cause of action. (See Ex Parte Application at p. 15:10-13, “[b]y this Application, [Plaintiff] seeks to preserve the status quo until its third cause of action can be determined. Given that [Plaintiff’s] third cause of action is a claim in equity, available equitable remedies would include injunctive relief.”)

In support of the third cause of action for declaratory relief, Plaintiff alleges that “[a] dispute has arisen between Canico and Defendants regarding whether the purported obligations secured by the Deeds of Trust of Defendants Nasser Saghian, Igal Javdanfar, Yousef Eshtiaghpour and Tal Hassid against the Property have been paid in full (or ever existed) and remain valid liens against the Property. Thus, an actual controversy exists between the parties regarding those Deeds of Trust.” (Compl., ¶ 38.) On the third cause of action, Plaintiff seeks “a judgment determining that any amounts owed to Defendants on their Deeds of Trust against the Property have been paid in full and that those Deeds of Trust are not valid and enforceable liens against the Property.” (Compl., p. 10:10-12.) The Court notes that Code of Civil Procedure section 1060 provides in pertinent part as follows:

“Any person interested under a written instrument, excluding a will or a trust, or under a contract, or who desires a declaration of his or her rights or duties with respect to another, or in respect to, in, over or upon property…may, in cases of actual controversy relating to the legal rights and duties of the respective parties, bring an original action or cross-complaint in the superior court for a declaration of his or her rights and duties in the premises, including a determination of any question of construction or validity arising under the instrument or contract. He or she may ask for a declaration of rights or duties, either alone or with other relief; and the court may make a binding declaration of these rights or duties, whether or not further relief is or could be claimed at the time. The declaration may be either affirmative or negative in form and effect, and the declaration shall have the force of a final judgment. The declaration may be had before there has been any breach of the obligation in respect to which said declaration is sought.”

Plaintiff indicates that it obtained a judgment in Los Angeles Superior Court Case No. SS022245 (the “Santa Monica Action”) against Avraham Hassid and Olympic 2000 Investments Group, LLC on May 3, 2012, when it registered a judgment that it had obtained against them in Arizona. (Assil Decl., ¶ 2, Ex. F.) Plaintiff also indicates that it obtained a judgment in Case No. LC086703 (the “Van Nuys Action”) against Avraham Hassid on August 10, 2012. (Assil Decl., ¶ 4, Ex. A.) Plaintiff indicates that Avraham Hassid has never made any voluntary payment on Plaintiff’s judgments against him the Santa Monica and Van Nuys Actions. (Assil Decl., ¶ 6.)

Plaintiff obtained a preliminary title report for the property at 309 N. Foothill Road,

Beverly Hills, CA 90210 (the “Property”), which showed, inter alia, a deed of trust recorded against the Property on September 11, 2012 in favor of Saghian, securing an $750,000.00 obligation. (Assil Decl., ¶¶ 10, 15-16.) Plaintiff indicates that Tal Hassid has been assigned Saghian’s deed of trust pursuant to an assignment dated December 21, 2021, which was recorded on January 7, 2022. (McCarthy Decl., ¶ 34, Ex. FF.)

Plaintiff asserts that “the evidence overwhelmingly suggests that nothing is owed on the Saghian Deed of Trust. As such, Tal Hassid (as Saghian’s assignee) is not entitled to foreclose. Thus, [Plaintiff] has a probability of success on the merits of its third cause of action because the sale would be void, if it occurred.” (Ex Parte Application at p. 13:2-6, citing to Nguyen v. Calhoun (2003) 105 Cal.App.4th 428, 440 [“on adequate proof that payment has been properly made or tendered, the debt is satisfied and the lien is extinguished. If the lien has been extinguished, there can be no foreclosure sale.”])

Plaintiff asserts that Avraham Hassid, Tal Hassid, and Saghian mostly responded to written discovery in this action with boilerplate objections and have not produced any documents evidencing that Saghian transferred or loaned $750,000.00 to Avraham Hassid, suggesting that there is no such evidence. (McCarthy Decl., ¶¶ 31-33.) Plaintiff indicates that no check, wire transfer confirmation, bank statement, or other document that evidenced a $750,000.00 loan from Saghian to Avraham Hassid has been produced. (McCarthy Decl., ¶ 32.)

In addition, Plaintiff asserts that “[t]here also is a probability of success because the Saghian Deed of Trust was a fraudulent transfer of the judgment debtor’s interest in the Property.” (Ex Parte Application at p. 13:7-8.) Plaintiff asserts that “nothing has been done to enforce the Saghian Deed of Trust in 10 years, even though the underlying note supposedly has been in default since it was signed in September 2012.” (Ex Parte Application at p. 5:19-21.) Plaintiff also contends that “[t]he timing of the Saghian Deed of Trust…evidences that it was based upon a debt that did not exist in that it was recorded on September 11, 2012, shortly after [Plaintiff] obtained its $350,000.00 judgment in this action on August 10, 2012, and obtained its $1,680,286.80 judgment in the Santa Monica action on May 3, 2012.” (Ex Parte Application at p. 8:9-12.)

In the opposition to Plaintiff’s request for a preliminary injunction, Defendants raise a number of arguments.

First, Defendants assert that “[Plaintiff] previously sued the 2012 noteholder on this very issue, back in 2016, but then the claims were abandoned and dismissed; [Plaintiff] therefore acquiesced in the legitimacy of the note.” (Opp’n at p. 8:2-5.) More specifically, Defendants assert that in 2016, Plaintiff sued Saghian in a separate action entitled Canico Capital Group, LLC v. Avraham Hassid, et al., Case No. BC637217, in which Plaintiff alleges, inter alia, that “on or about November 2012 NASSER SAGHIAN recorded a Deed of Trust on Avraham Hassid’s personal residence located at 309 N. Foothill Road, Beverly Hills, California 90210 [APN: 4342-019-012] in the amount $750,000. Plaintiff is informed and believes and based thereon alleges that the Deed of Trust did not represent a loan or any consideration or reasonable equivalent value from NASSER SAGHIAN to Avraham Hassid or Ladan Hassid. Rather this recorded Deed of Trust was intended to assist Avraham Hassid to hinder, delay or defraud the collection of the judgments rendered against Avraham Hassid by Plaintiff.” (Friedman Decl., ¶ 3, Ex. 1, ¶ 25.) Saghian asserts that he was never served with this lawsuit and never appeared in that case. (Saghian Decl., ¶ 8.) Plaintiff counters that Saghian’s name does not appear in the caption of the Complaint in Case No. BC637217. (See Friedman Decl., ¶ 3, Ex. 1.)

Next, Defendants assert that “Canico denies that any funds were provided for the Saghian note, but in another related action, Canico not only presented evidence of those funds, but also seeks those funds as damages.” (Opp’n at p. 9:14-17.) Defendants provide excerpts from the deposition transcript of Luke Goetz, taken April 5, 2022 in the matter Canico Capital Group, LLC v. Avraham Hassid, et al., Case No. BC637217, as well as Exhibit 3 from that deposition entitled “Final Expert Witness Report of Luke Goetz” dated March 29, 2022. (Zohar Decl., ¶ 4.)

In his deposition, Mr. Goetz testified that he was retained by plaintiff in Case No. BC637217 to present expert testimony at trial. (Zohar Decl., ¶ 4, Ex. 6 (Goetz Depo.) at p. 6:10-14.)

Mr. Goetz’s “Final Expert Witness Report” indicates, inter alia, that “[t]he following summarizes funds received by Tal Hassid…from ETO Doors, related entities and insiders that were used to make equity payments of the real estate purchased in 2014 and 2015. 1) $120,000 deposit on 12/16/14 (two cashier’s checks from Nasser Saghian, who has held a deed of trust against Avraham Hassid’s home)… 5) $130,000 deposit on 1/12/15 from Nasser Saghian Cashier’s check.” (Zohar Decl., ¶ 4, Ex. 3.) But as Plaintiff notes, the expert report provided by Defendants does not show evidence of transfers of funds by Saghian to Avraham Hassid before the September 2012 Saghian note and deed of trust. Instead, the report refers to checks that were received by Tal Hassid (not Avraham Hassid) in December 2014 and January 2015.

Defendants also indicate that Saghian was able to locate a copy of an April 9, 2008 check from his company, Meroni Investment Group Inc. payable to Brick Lofts, LLC, a company owned by Avraham Hassid, in the amount of $200,000. (Saghian Decl., ¶ 13, Ex. 14.) Saghian also located two checks dated October 1, 2009 and October 6, 2009 from Saghian to Avraham Hassid in the amounts of $72,000 and $8,000, respectively. (Saghian Decl., ¶ 14, Ex. 15.) Saghian asserts that prior to 2012, he loaned no less than $750,000 to Avraham Hassid, either directly or to his various entities, and that prior to 2012, these loans were not secured by deeds of trust. (Saghian Decl., ¶¶ 4-5.) Saghian states that in 2012, he determined that he needed security for these funds, and potentially for future loans, so he had Avraham Hassid execute a promissory note in the amount of $750,000. (Saghian Decl., ¶ 5.) In 2012, Saghian also recorded a deed of trust for this note against the Property. (Saghian Decl., ¶ 6.)

Plaintiff counters that Defendants have not presented admissible evidence of $750,000.00 being loaned by Saghian to Avraham Hassid. Defendants note that the exhibits to Saghian’s declaration do not prove a $750,000 loan. Specifically, Exhibit 14 is a check that appears to be dated April 9, 2008, from Saghian’s company Meroni Investment Group Inc., payable to “Brick Lofts, LLC” in the amount of $200,000. (Saghian Decl., ¶ 13, Ex. 14.) As Plaintiff notes, the check does not show a loan from Saghian to Avraham Hassid. In addition, as Plaintiff further notes, Exhibit 15 includes an $8,000 check to “Aurahm Hassid” dated October 6, 2009, which does not show that it was purchased by Saghian. (Saghian Decl., ¶ 14, Ex. 15.) Exhibit 15 also includes a $72,000 check with a blank payee line. (Ibid.) The $72,000 check does not indicate that it is payable to Avraham Hassid or anyone else. (Ibid.) Plaintiff also notes that no evidence has been submitted that any of these supposed obligations were not repaid.

Defendants also assert in the opposition that Plaintiff has an adequate remedy at law (damages), such that an injunction is proper. Defendants note that “[a] party seeking injunctive relief must show the absence of an adequate remedy at law.” (Department of Fish & Game v. Anderson-Cottonwood Irrigation Dist. (1992) 8 Cal.App.4th 1554, 1564.) Defendants contend that the entire basis of Plaintiff’s action is money damages from outstanding money judgments against Avraham Hassid, and that a money judgment will accordingly suffice. But as set forth above, Plaintiff’s Ex Parte Application concerns Plaintiff’s third cause of action for declaratory relief. Plaintiff asserts that the fact that it has been unable to collect on two money judgments since 2012 and that the Property is Avraham Hassid’s only known asset of value is exactly why an injunction is needed.

Defendants also assert that the doctrine of laches bars Plaintiff’s claim. Defendants note that “[t]he defense of laches requires unreasonable delay plus either acquiescence in the act about which plaintiff complains or prejudice to the defendant resulting from the delay.” (Duskin v. San Francisco Redevelopment Agency (1973) 31 Cal.App.3d 769, 774.) Defendants argue that “Plaintiff’s request for TRO is more than 10 years after the recording of the 2012 Note and Deed upon which the TRO is based, and it is years after [Plaintiff’s] claims on that 2012 Note and Deed in an identical action against Defendant’s lienholder predecessor-in-interest were abandoned and dismissed. This is unreasonable delay.” (Opp’n at p. 14:12-15.) Defendants also assert that “by filing and then abandoning identical claims against the original noteholder, Saghian, [Plaintiff] also acquiesced in the validity of the 2012 Note and Deed. Otherwise, they would have continued to pursue those claims back in 2016.” (Opp’n at p. 14:16-18.)

Plaintiff counters that “Tal Hassid complains of ‘unreasonable delay’ by [Plaintiff] in seeking to invalidate the Saghian DOT. There was a good reason for that delay. A huge judgment lien was of record against the Property until it expired in 2021, which was senior to [Plaintiff’s] judgment liens. Until that point, it made no sense to challenge any senior liens because the value of the Property was insufficient to cover those liens, leaving nothing to cover [Plaintiff’s] junior judgment liens. In other words, at that point [Plaintiff] lacked standing. After that judgment lien expired, however, [Plaintiff] sought a beneficiary statement from Saghian in September and November 2021 so that it would have the information necessary to pursue a sheriff’s sale. Saghian refused to respond. This lawsuit then was promptly filed on December 10, 2021.” (Reply at p. 10:6-14, citing to Suppl. Assil Decl., ¶¶2-6, Ex. A.) As also set forth above, Plaintiff also asserts that Saghian’s name does not appear in the caption of the Complaint in Case No. BC637217. (See Friedman Decl., ¶ 3, Ex. 1.)

Defendants also assert that they have been prejudiced by Plaintiff’s delay in bringing the instant claims. Tal Hassid indicates that he purchased the subject note from Saghian on December 21, 2021, that under the terms of this Note Sale Agreement, he agreed to pay Saghian a total of $2 million for the note payable in four installments, and that to date, Tal Hassid has timely paid Saghian the first two payments of $500,000 each. (Tal Hassid Decl., ¶ 4.) Defendants argue that “[t]he TRO now undermines Tal Hassid’s ability to secure, and foreclose on, the note, and if Tal Hassid is restrained from foreclosing, all while Canico engages in its own sheriff’s sale, Tal Hassid will lose the security on the note altogether.” (Opp’n at p. 14:21-24.) Defendants assert that Plaintiff has appeared in another matter, Canico Capital Group, LLC v. Olympic 2000 Investment Group, LLC, et al., Case No. SS022245, in which Plaintiff attempts to undertake its own sheriff’s sale of the same Property that is subject to the Court’s TRO in this case. Defendants also assert that “[t]he banks involved destroyed any records showing proof of the funds transferred to Avraham Hassid as consideration for the note, thus causing prejudice to Defendant Tal Hassid and causing all Defendants great difficulty in locating evidence to prove the validity of the original note.” (Opp’n at p. 15:5-8.) Saghian asserts that he searched for records related to the payments to Avraham Hassid or his entities, but was told by his bank, Bank of America, that they only maintain records for seven years. (Saghian Decl., ¶ 11.)

Plaintiff counters that Tal Hassid cannot show prejudice, as discussed in further detail below in connection with the “Interim Harm to the Parties” section. As to Case No. SS022245, Plaintiff asserts that “Defendants’ desire to use the sham Saghian DOT to accomplish a foreclosure sale before [Plaintiff] can obtain a sheriff’s sale is not a reason to deny the preliminary injunction.” (Reply at p. 11:19-20.) Plaintiff also asserts that if Defendants believe that the Court should deny the sale order in Case No. SS022245 in order to “preserve the status quo,” they should be making such argument in that matter, rather than in the instant case. The Court agrees.

The Court notes that Plaintiff also asserts in the Ex Parte Application that Tal Hassid claims to be owed $5.5 million on the assigned Saghian note by calculating interest at a default rate of 18% per annum (up from 10%), plus a late charge of 10% on each alleged late payment. (McCarthy Decl., ¶ 34, Ex. HH.) Plaintiff asserts that no evidence has been submitted to show that Saghian was exempt from California’s usury laws. (McCarthy Decl., ¶ 34.) Defendants assert that Plaintiff does not have standing to assert a usury defense. Defendants cite to Roes v. Wong (1999) 69 Cal.App.4th 375, 379-380, where the Court of Appeal noted that “it has been held that the holder of a junior encumbrance who pays off the senior lienholder to stave off foreclosure on the senior indebtedness may not assert a claim for usury…in the case of a default of a senior encumbrance . . . the holder of the junior encumbrance must decide whether to lose his estate in the encumbranced property or pay whatever is necessary to satisfy the holder of the senior encumbrance. By satisfying the demands of the holder of the senior encumbrance, even though the senior loan is usurious in nature, the holder of the junior encumbrance does not have a cause of action for usury. . . . The obvious and cogent reason for this rule of law is that the party or his personal representative asserting the claim of usury must be personally obligated on the promissory note or indebtedness. Because the junior lienholder is not directly liable for the original loan and does not act in a representative capacity on behalf of the borrower, he does not have standing to assert usury.” (Internal quotations and citations omitted.)

Lastly, Plaintiff notes that Defendants’ opposition does not address Plaintiff’s arguments pertaining to the timing of the Saghian deed of trust (which is discussed above).

Based on the foregoing and a consideration of the arguments presented, the Court finds that Plaintiff has established a likelihood of success on the merits as to its third cause of action.

“To obtain a preliminary injunction, a plaintiff ordinarily is required to present evidence of the irreparable injury or interim harm that it will suffer if an injunction is not issued pending an adjudication of the merits.” (White v. Davis, supra, at p. 554.) “In evaluating interim harm, the trial court compares the injury to the plaintiff in the absence of an injunction to the injury the defendant is likely to suffer if an injunction is issued.” (Shoemaker v. County of Los Angeles (1995) 37 Cal.App.4th 618, 633.)

Plaintiff asserts that it “will be irreparably injured if the foreclosure goes forward…because the fraudulent assigned Saghian Deed of Trust (on which nothing is owed) will foreclose out the junior judgment liens held by Canico against the Property securing judgments in excess of $4,400,000.00 against Avraham Hassid…” (Ex Parte Application at p. 10:4-9.) Plaintiff asserts that the subject Property “is the only known asset of value that Hassid owns or holds an interest in.” (Assil Decl., ¶ 14.)

As set forth above, Defendants assert that if Tal Hassid is restrained from foreclosing, Tal Hassid will lose the security on the note altogether and will thus be prejudiced. Plaintiff counters that Tal Hassid has not offered proof of paying anything yet and thus does not demonstrate prejudice. Plaintiff also notes that Tal Hassid indicates that he “purchased this note from Nasser Saghian on December 21, 2021.” (Tal Hassid Decl., ¶ 4.) Plaintiff notes that he thus purchased the note after the instant lawsuit was filed on December 10, 2021 and after Tal Hassid was served on December 16, 2021.[2] Plaintiff asserts that Tal Hassid accordingly cannot claim to have suffered prejudice.

The Court finds that Plaintiff has established that the balance of harms tips in its favor. Thus, the Court finds that Plaintiff has demonstrated entitlement to injunctive relief.

Defendants assert that if a preliminary injunction is kept in place, the Court should mandate that Plaintiff post an undertaking of at least $3 million dollars.

Defendants note that “[i]f the PI is granted, the court must require an undertaking (CCP § 529), or allow a cash deposit in lieu thereof (CCP § 995.710).” (Weil & Brown, Cal. Practice Guide: Civil Procedure Before Trial (The Rutter Group 2022) ¶ 9:640.) “Section 529, subdivision (a), requires that the amount of the undertaking be sufficient to pay to the party enjoined such damages . . . as the party may sustain by reason of the injunction, if the court finally decides that the applicant was not entitled to the injunction. Thus, the trial court’s function is to estimate the harmful effect which the injunction is likely to have on the restrained party, and to set the undertaking at that sum.” (ABBA Rubber Co. v. Seaquist (1991) 235 Cal.App.3d 1, 14 [internal quotations omitted].) In addition, “[i]t is now well settled that reasonable counsel fees and expenses incurred in successfully procuring a final decision dissolving the injunction are recoverable as damages within the meaning of the language of the undertaking, to the extent that those fees are for services that relate to such dissolution…” (Id. at p. 15 [internal quotations omitted].)

Tal Hassid asserts in his declaration that if Plaintiff “is permitted to force a sheriff’s sale on the Property, it will cause me significant financial damage. Specifically, I will lose the security on the $2 million assigned note, and I am already incurring attorney’s fees and costs as a result of having to verify the validity of a note from 2012…” (Tal Hassid Decl., ¶ 8.) As set forth above, Tal Hassid indicates that he agreed to pay Saghian a total of $2 million for the note, payable in four Installments, and that to date, Tal Hassid has paid Saghian the first two payments of $500,000 each. (Tal Hassid Decl., ¶ 4, Exs. 8-9.)

Plaintiff counters that the bond should be nominal. Plaintiff notes that the two $500,000 checks (referenced above) do not show that they were deposited, and that Tal Hassid and Saghian do not state that they were cashed or deposited. (Tal Hassid Decl., ¶ 4, Exs. 8-9.) Plaintiff further asserts that “[t]he Saghian Note bears interest at 10% per annum. An $18,750 bond would cover three months of interest until trial. Tal Hassid has not suggested he will be unable to collect from his father, but if any bond is required beyond a nominal $5,000 bond, it should not exceed $18,750.” (Reply at p. 13:13-15.) The Court notes that these calculations were set forth for the first time in Plaintiff’s reply, so Defendants have not had the opportunity to respond to them.

Based on the foregoing, the Court grants the Order to Show Cause Re: Preliminary Injunction. The Court continues the hearing on the OSC Re: Preliminary Injunction to ________, 2023 at 10:00 a.m. Defendants may file and serve by ________, 2023 at 5:00 p.m. a surreply pertaining to the amount of the bond. Any such surreply may not include arguments pertaining to any other matters.

trustee’s sale of the Property shall remain in full force and effect pending the issuance of the preliminary injunction. Upon the Court’s determination as to the amount of the bond, the Court will sign the proposed preliminary injunction submitted by Plaintiff on February 17, 2023.

[1]As Plaintiff notes, Defendants’ opposition is 17 pages. The Court notes that “¿[e]xcept in a summary judgment or summary adjudication motion, no opening or responding memorandum may exceed 15 pages.¿” (¿Cal. Rules of Court, Rule 3.1113, subd¿. (d).) The Court will exercise its discretion to consider Defendants’ opposition, but the Court¿admonishes Defendants that¿any¿future filings must comply with the California Rules of Court.¿

[2]Plaintiff filed a proof of service on January 5, 2022 indicating that Tal Hassid was served with the Complaint on December 16, 2021.

Superior Court of California

County of Los Angeles

Department 50