Judge: Teresa A. Beaudet, Case: 24STCV07876, Date: 2025-01-02 Tentative Ruling

Case Number: 24STCV07876    Hearing Date: January 2, 2025    Dept: 50

Superior Court of California

County of Los Angeles

Department 50

Background

Plaintiff Jan Ying Benevolent Association of Los Angeles (“JYB”) filed this action on March 28, 2024 against Defendants Tak Seng Wong, Kemi Cai, and Ze Xian Li (collectively, “Defendants”) The Complaint alleges causes of action for (1) fraud, (2) breach of fiduciary duties and trust, (3) abuse of control, (4) corporate waste, (5) accounting, (6) declaratory relief, (7) trespass, and (8) injunction.

In the Complaint, JYB alleges that it is a California nonprofit corporation. (Compl., ¶ 1.)

There are currently three branches of The Jan Ying Benevolent Association: the San Francisco Association, JYB, and the Fresno Branch. (Compl., ¶ 10.) “An important JYB event is the annual election, where various nominees are voted on by the Members.” (Compl., ¶ 13.) “On or about November 10, 2023, without any right or proper authorization, WONG, via the social media application, WeChat, sent notice to the Members and purportedly advanced the election date from November 17, 2023, to November 12, 2023 (the ‘Sham Election’).” (Compl., ¶ 14.) “WONG knew that several members…were not scheduled to return to the United States until after November 12, 2023. Additionally, even though candidates had not yet been chosen (which is the traditional procedure), CAI unilaterally and without any authorization, decided to hold the Sham Election via ballot procedure.” (Compl., ¶ 14.)

JYB alleges that “[a]t the Sham Election, Gregory Wong presented an unauthorized motion to add LI to the ballot as President. However, none of the JYB members present at the Sham Election seconded the motion to add LI to the ballot. Undeterred, CAI, who should not have been there[1], began an immediate vote, again against all JYB rules, and pressured new members to vote for LI.” (Compl., ¶ 15.) JYB alleges that “as the Sham Election was conducted illegally, and without authorization, LI’s presidency was considered by a vast majority of JYB members as a sham, just like the election was a sham. And to complete their devious plan, WONG switched positions with LI; WONG became the unofficial president, and LI the unofficial vice-president.” (Compl., ¶ 16.)

JYB alleges that “the three associations met in Los Angeles on or about December 2, 2023, for the purpose of determining the appropriate discipline for those members who broke JYB’s rules (the ‘December 2, 2023, Meeting’)…Although LI attended the December 2, 2023, Meeting, LI refused to sign the attendance log sheet, made audio and video recordings of the meeting, and significantly disrupted the proceedings. LI was eventually escorted out of the December 2, 2023, Meeting by police.” (Compl., ¶¶ 21-22.) JYB alleges that “[a]s a result of all of LI’s unauthorized malicious actions in connection to his sham election as president and the December 2, 2023, Meeting, JYB unanimously passed the decree expelling LI not only from his leadership position within JYB, but from JYB membership.” (Compl., ¶ 23.) “Additionally, JYB unanimously voted to suspend WONG for five years from any positions of leadership and membership.” (Compl., ¶ 23.)

JYB alleges that “[d]espite the fact that CAI and LI’s memberships were terminated, and WONG was suspended for five years starting December 2, 2023, on December 15, 2023, WONG ordered Gi Hao Cheung to file a Statement of Information with the California Secretary of State naming himself as the Chief Executive Officer, Steve Chan as Secretary, and Sin Ling Wong as Chief Financial Officer…WONG used the address of JYB’s real property, located at 736 North Yale Street, Los Angeles, California 90012 (the ‘Clubhouse’) as each officer’s address even though he had no right to use the Clubhouse for any purpose whatsoever.” (Compl., ¶ 25.) “On December 23, 2023, WONG, CAI and LI locked out and physically blocked JYB members from entering the Clubhouse.” (Compl., ¶ 27.)

JYB alleges that “[d]espite demands by JYB to DEFENDANTS to cease and desist all unauthorized activities, and to recognize the true leadership, DEFENDANTS have doubled down, taken control of JYB’s Clubhouse, privately controlled the finances, hidden the corporate seal, have attempted to highjack control of JYB, and have locked JYB membership out of the Clubhouse.” (Compl., ¶ 29.) JYB alleges that “WONG is using JYB’s corporate bank accounts as his own personal accounts and WONG has stolen and misappropriated significant funds from these accounts.” (Compl., ¶ 30.)

            JYB now applies ex parte for a temporary restraining order and an order to show cause why a preliminary injunction should not issue for certain specified relief. (See Ex Parte Application at p. 2:1-22.) Defendants oppose.

Discussion

A temporary restraining order may issue when “[i]t appears from facts shown by affidavit or by the verified complaint that great or irreparable injury will result to the applicant before the matter can be heard on notice.” ((Code Civ. Proc., § 527, subd. (c)(1).) “[T]rial courts should evaluate two interrelated factors when deciding whether or not to issue [a restraining order]. The first is the likelihood that the plaintiff will prevail on the merits at trial. The second is the interim harm that the plaintiff is likely to sustain if the [restraining order] were denied as compared to the harm that the defendant is likely to suffer if the [order] were issued.” ((Church of Christ in Hollywood v. Superior Court (2002) 99 Cal.App.4th 1244, 1251.)

“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 to support [a restraining order]…Of course, [t]he scope of available preliminary relief is necessarily limited by the scope of the relief likely to be obtained at trial on the merits…A trial court may not grant a [restraining order], regardless of the balance of interim harm, unless there is some possibility that the plaintiff would ultimately prevail on the merits of the claim.”(Church of Christ in Hollywood v. Superior Court, supra, 99 Cal.App.4th at pp. 1251-1252 [internal quotations omitted].)

            Furthermore, “an injunctive order should be limited in scope to the subject of the litigation.” ((City of Redlands v. County of San Bernardino (2002) 96 Cal.App.4th 398, 415.)

            Here, JYB seeks a temporary restraining order and an order to show cause why a preliminary injunction should not issue for the following relief:

“1. For Defendants, Tak Seng Wong…Kemi Cai…and Zi Xian Li…(collectively referred to as ‘DEFENDANTS’), and each of them, to allow all JYB members, officers and board members, including those individuals listed in Exhibit C (Elected Staff Roster 2025), to freely enter and use the JYB headquarters – located at 736 North Yale Street, Los Angeles, California 90012 (the ‘Clubhouse’) – at their will;

2. For DEFENDANTS, in order to effectuate request Number 1, to issue keys to all gates, doors and any other locks located on the Clubhouse premises, to Mr. Hui Reng Huang, Vincent Wong, Xiliang Yu, Bai Yan Chen and Lida Ko;

3. For DEFENDANTS to remove any signs posted on Clubhouse gates, walls and doors, and to refrain from posting any such signs in the future;

4. For DEFENDANTS to refrain from holding themselves out as members and/or officers of JYB;

5. For DEFENDANTS to deliver JYB’s financial books of accounting to Ms. Lida Ko; and

6. For DEFENDANTS to turn over all of JYB’s corporate documents.” (Ex Parte Application at p. 2:5-22.)

            As an initial matter, in the opposition, Defendants state that they object “to the ex parte notice…because no notice was telephonically made to [Defendants’ counsel]…” (Opp’n at p. 1:26-27.) However, Defendants do not cite any legal authority indicating that JYB is required to provide notice of the ex parte application telephonically. Pursuant to California Rules of Court, rule 3.1203, subdivision (a), “[a] party seeking an ex parte order must notify all parties no later than 10:00 a.m. the court day before the ex parte appearance, absent a showing of exceptional circumstances that justify a shorter time for notice.” Pursuant to California Rules of Court, rule 3.1204, subdivision (a), “[w]hen notice of an ex parte application is given, the person giving notice must: (1) State with specificity the nature of the relief to be requested and the date, time, and place for the presentation of the application; and (2) Attempt to determine whether the opposing party will appear to oppose the application.”

            JYB’s counsel indicates that on December 19, 2024 at 8:54 a.m., he sent an email to Defendants’ counsel providing, inter alia, “[p]lease take notice that counsel for Plaintiff, Jan Ying Benevolent Association of Los Angeles, will be going in ex parte on Friday, December 20, 2024 at 8:30 A.M. in Department 50 of the Los Angeles Superior Court, Stanley Mosk Courthouse, located at 111 North Hill Street, Los Angeles, California 90012, to request an Ex Parte Order for a Preliminary Injunction. Please let me know if you plan on opposing this ex parte motion…” (Yim Decl., ¶ 2, Ex. A.)[2]

            In the ex parte application, JYB asserts that it has a high likelihood of success on the merits because “Defendants are neither members, officers nor directors of JYB,” and “[t]he current officers and directors of JYB were duly elected.” (Ex Parte Application at p. 8:17; 8:27.)

As an initial matter, JYB’s ex parte application does not appear to discuss any of the causes of action alleged in the Complaint. As set forth above, the Complaint alleges causes of action for (1) fraud, (2) breach of fiduciary duties and trust, (3) abuse of control, (4) corporate waste, (5) accounting, (6) declaratory relief, (7) trespass, and (8) “injunction.” The ex parte application does not discuss the elements of these causes of action or contain any analysis as to why JYB will purportedly prevail on the merits as to the causes of action. As discussed above, “[a] trial court may not grant a [restraining order], regardless of the balance of interim harm, unless there is some possibility that the plaintiff would ultimately prevail on the merits of the claim.” ((Church of Christ in Hollywood v. Superior Court, supra, 99 Cal.App.4th at p. 1252.) The Court does not find that JYB has met its burden of demonstrating a likelihood of prevailing on the merits of its causes of action.  

            JYB also argues that “[i]f this Application is not granted, and DEFENDANTS are able [to] exclude said members, officers and directors, the irreparable harm suffered by JYB will grow until the company eventually collapses.” (Ex Parte Application at p. 9:24-26.) However, JYB does not appear to cite to any evidence to support this argument. As discussed, the second factor relevant to the determination of whether or not to issue a temporary restraining order is “the interim harm that the plaintiff is likely to sustain if the restraining order were denied as compared to the harm that the defendant is likely to suffer if the order were issued.” (Church of Christ in Hollywood v. Superior Court, supra, 99 Cal.App.4th at p. 1251 [internal brackets omitted].) It is unclear what purported evidence (if any) JYB is relying on to show the interim harm it is allegedly likely to sustain if the temporary restraining order is denied. JYB also argues, without citing to any supporting evidence, that “by keeping the status quo, DEFENDANTS will suffer no harm whatsoever.” (Ex Parte Application at p. 10:1-2.)

            In light of the foregoing, the Court denies JYB’s ex parte application for a temporary restraining order and an order to show cause why a preliminary injunction should not issue. 

Conclusion

Based on the foregoing, JYB’s ex parte application is denied.  

JYB is ordered to give notice of this Order.

DATED:  January 2, 2025                              ________________________________

Hon. Teresa A. Beaudet

Judge, Los Angeles Superior Court