Modification: Siry Investment v. Farkhondehpour

SIRY INVESTMENT, L.P.,

Plaintiff and Appellant

v.

SAEED FARKHONDEHPOUR et al.,

Defendants and Appellants.

No. B277750

(Consolidated with B279009 and B285904)

(Los Angeles County

Super. Ct. No. BC372362)

California Courts of Appeal

Second Appellate District

Division Two

Filed March 23, 2020

THE COURT:

It is ordered that the opinion filed herein on March 3, 2020, be modified as follows:

1. On page 47, after the penultimate sentence of the last full paragraph (immediately after "1029.8."), insert a footnote with the following text:

For the first time in its petition for rehearing, Siry argues that the trial court's award of attorney fees rests on two other statutes: (1) now-repealed Corporations Code section 15634, and (2) section 2023.030, subdivision (a).

By mentioning former Corporations Code section 15634 only in its response to defendants' argument that the trial court should not have awarded Siry a subset of attorney fees "for litigating the prior [2003] accounting action" and not mentioning section 2023.030, subdivision (a) at all in its merits briefs, Siry has waited until its petition for hearing to assert these statutes as alternative grounds for affirming the attorney fees award. Its arguments have accordingly been waived. (Reynolds v. Bement (2005) 36 Cal.4th 1075, 1092, abrogated on other grounds as stated in Martinez v. Combs (2010) 49 Cal.4th 35.)

Although the trial court's order awarded Siry attorney fees "pursuant to [] section 1029.8, Penal Code section 496 and other fee shifting provisions discussed in Siry's damages brief" (italics added), that order was not grounded on either former Corporations Code section 15634 or section 2023.030.

The fee award was not grounded in former Corporations Code section 15634 because that provision, until its repeal in 2010, gave a trial court the discretion to award attorney fees only in actions brought "under" that section "to inspect . . . partnership . . . records" (former Corp. Code, § 15634, subd. (g); Berti v. Santa Barbara Beach Properties (2006) 145 Cal.App.4th 70, 72), and Siry's operative fifth amended complaint neither sought an order to inspect records nor cited former Corporations Code section 15634 at all. Siry's untethered allegation that defendants denied it "access to copies of the . . . Partnership's full and accurate financial records" and its expansive statement in its default prove-up package that "all applicable fee-shifting provisions" apply, accompanied by a footnote citing Corporations Code section 15634 illustratively, cannot compensate for Siry's failure to adequately plead a claim "under" this statute.

The fee award was also not grounded in section 2023.030, subdivision (a) because the trial court ordered Siry to "present[]" its "request for attorney fees" "in [its] default package," and as Siry concedes, it did not present section 2023.030 as a basis for fees in its package. Siry's suggestion that its request for all of its attorney fees under Penal Code section 496 and section 1029.8 necessarily encompassed a claim for the un-segregated subset of those fees attributable to the terminating sanctions motion works only if a party's failure to plead a ground for relief means that every possible ground for relief applies. This turns the usual rules of pleading on their head.

2. On page 7, at the end of the carry-over paragraph (after "$12,023.067.10"), insert a footnote with the following text:

Siry contends that the original judgment came to a total of $16,023,067.10 because, as it reads that judgment, the trial court awarded a total of $8 million in punitive damages---half against the Farkhondehpour parties and half against the Neman parties. We question Siry's reading of the original judgment but need not parse it because the relevant judgment on appeal is the amended judgment, which we discuss infra.

There is no change in the judgment.

Appellant's petition for rehearing is denied.

LUI, P.J.,

CHAVEZ, J.,

HOFFSTADT, J.