Facts

Plaintiff Taeseob Yang bought a business from defendants Lovan Tran and The Deals Center LLC. Plaintiff sued defendants for fraud and rescission of the contract, claiming that defendants misrepresented the financial performance of the business. Plaintiff also sued Yong Sok Kim and New Star Realty, who provided brokerage services for defendant Tran.

Tran and The Deals Center filed a cross-complaint.

PLAINTIFF'S CONTENTIONS:
Plaintiff contended that defendants either misrepresented the store's sales and profit history, or else defendants misrepresented how much sales volume that three contracts were responsible generating for the store. The three contracts were carved out of the sale shortly before escrow closed.

DEFENDANTS' CONTENTIONS:
Defendants claimed they did not misrepresent anything to plaintiff and that plaintiff conducted due diligence before closing escrow. Defendants claimed the store failed after close of escrow because plaintiff got rid of key staff and significantly changed the business model. Defendants claimed that plaintiff owed them money for the balance of the purchase price and unpaid rent after the store closed.

CROSS-COMPLAINANT'S

Settlement Discussions

Plaintiff demanded $200,000 on the complaint and defendants demanded $300,000 on their cross-complaint.

Result

After a four-day bench trial, the judge found in favor of plaintiff on the fraud claim and ordered the purchase agreement rescinded. The judge found against cross-complainants on their cross-complaint. The judge awarded plaintiff the full amount of damages that he requested in the amount of $215,948.

Other Information

Plaintiff reached a settlement with Kim and New Star during trial. Plaintiff has filed motions for attorney fees, and for award of prejudgment interest, which will be heard July 1. FILING DATE: Jan. 7, 2014.