Facts

Plaintiff Raul R. Rodriguez is an Emmy-winning commentator, internationally acclaimed illustrator, and a parade, float, shopping center and casino designer. Plaintiff designs on average, 14 floats per year for the Rose Parade, and has won the top prize over 20 times during his career. He has also designed Disneyland and Universal City parades.

In 1989, he hired his first cousin, defendant Diane L. Cortez, to act as his business manager. In 1990, Cortez moved into Rodriguez's Hancock Park mansion. Over the next 17 years, Cortez acted as the business manager for Rodriguez and shared with her his life traveling around the world and hob nobbing with celebrities. Unbeknownst to Rodriguez, Cortez, who had complete discretion over all of Rodriguez's affairs, was systematically stealing large sums of money and running up large debts secured by Rodriguez's Hancock Park home. Cortez had blanket power of attorney to act for Rodriquez.

In 1997, Cortez changed Rodriguez's CPA and began a more sophisticated plan to pay herself lump sums of money which she called loans at the time. She later claimed these amounts as income. Cortez also arranged an illustration deal for Rodriguez where he was paid a royalty. Unknown to Rodriguez, Cortez had arranged to also receive a royalty equal to 50 percent of Rodriguez's royalty.

Rodriguez became suspicious of Cortez in 2005 and 2006 when he had to pay large sums of money to the CPA hired by Cortez to defend him in three IRS audits on his personal taxes. Rodriguez was reluctant to act, as Cortez was his first cousin and he was close to most of Cortez's family. Once Rodriguez became convinced that Cortez was not acting in his best interest, he fired her in October 2006. It was only during discovery in this lawsuit did Rodriguez come to discover the full extent of Cortez's improper actions.

PLAINTIFF'S CONTENTIONS:
Rodriguez contended that he hired Cortez to act as a part time business manager and to be paid the sum of $20,000 per year with gradual CPI increases. In 1990, the agreement was modified, allowing Cortez to move into Rodriguez's house and it oversee the household staff in exchange for room and board. Rodriguez gave Cortez complete discretion over all his business and financial affairs, including the task of paying herself.

Being first cousins, Rodriguez trusted Cortez to do the right thing and to handle his affairs in keeping with her fiduciary duty. Instead, Cortez breached her fiduciary duty, did not have a written agreement stating the terms of her employment and commingled funds. Cortez used Rodriguez's money to pay her personal expenses and bills, personal travel, plastic surgery, utilities on other properties she owned, for a fence on her other property, and for painting on these properties. She wrote over $200,000 in checks, which she endorsed and cashed. She had no receipts for any cash allegedly given to Rodriguez.

Cortez also had Rodriguez invest in an apartment building. Using Rodriguez's funds, Cortez wrote a check for the down payment but never put Rodriguez on title or made him a partner. Cortez never told Rodriguez when the building was sold and pocketed over $360,000 from that transaction. Cortez also cut herself a side deal to receive 3 percent of the net royalties of Rodriguez's children's book. Cortez never disclosed the existence of this side deal nor did she ever get approval from her client Rodriguez.

DEFENDANT'S CONTENTIONS:
Cortez contended that Rodriguez owed her over $300,000 in back pay plus interest, which totaled $1 million. Cortez contended that Rodriguez agreed to pay her $60,000 per year plus full benefits. This was an oral agreement. Cortez attempted to memorialize this agreement in 1999, however, the court ruled that document did not constitute a written contract but may be considered as evidence of an oral agreement. Cortez denied all allegations and demanded payment of over $1 million from Rodriguez.

Settlement Discussions

According to defense counsel, plaintiff made settlement demands of $1.5 million and $1 million. According to plaintiff's counsel, Rodriguez made settlement demands of only $1 million. Prior to trial, Cortez filed and served a 998 offer to pay Rodriguez $20,000. During trial, after dismissal of the conspiracy cause of action with defendant Dutra, Cortez offered to accept the payment of $500,000 from Rodriguez.

Result

Verdict for $982,087 ($882,087 economic; $100,000 punitive). Rodriguez prevailed against Cortez on all causes of action, which included breach of fiduciary duty, conversion, fraud, concealment, misrepresentation, breach of contract and negligence. The jury also awarded punitive damages, finding that Cortez's acted with malice and fraud.

Other Information

Cortez demanded that Rodriguez pay her the sum of $500,000 during trial. That offer was rejected. Oral motions at trial to interrogate the jurors, for a new trial and JNOV brought by Cortez were denied. Cortez shall be filing a written motion for JNOV and new trial. FILING DATE: Oct. 26, 2006.

Deliberation

three days

Poll

12-0 (liability), 12-0 (compensatory damages), 12-0 (punitive damages), 9-3 (punitive damages amount)

Length

one month