Z Valet, Inc. v. House of Blues, et al.
Published: Jan. 10, 1998 | Result Date: Nov. 14, 1997 | Filing Date: Jan. 1, 1900 |Case number: BC141039 – $2,700,000
Judge
Court
L.A. Superior Central
Attorneys
Plaintiff
Robert M. Silverman
(Law Office of Robert M. Silverman)
Timothy D. McGonigle
(Law Offices of Timothy D. McGonigle APC)
Defendant
Joshua N. Levine
(Booth LLP)
Jeff C. Katofsky
(Jeff Katofsky, Esq.)
J. Anthony Vittal
(Vittal Law Firm)
Facts
Plaintiff Z Valet is in the business of providing valet parking service. Defendant Valet Parking Service Inc. (VPSI) is one of plaintiff's competitors. Defendant Herb Citrin is the CEO of VPSI. Defendant House of Blues Los Angeles Restaurant Corp. (Blues) operates a nightclub/restaurant in West Hollywood. In June 1994, Blues considered replacing its current parking provider. In June 1994, Blues contacted Z Valet, VPSI and others to solicit proposals for the provision of valet parking services. By letter dated June 30, 1994, Z Valet presented Blues with its proposal for providing parking services. Subsequently, Steve Strauss, in his capacity as general manager of Blues, entered into oral negotiations with Z Valet regarding the provision of valet parking services. On July 19, 1994, Z Valet gave an oral presentation to Blues. According to plaintiff, following its oral presentation, two other companies also made oral presentations to Blues concerning the provision of valet parking services. The second oral presentation was made by defendant VPSI. Consequently, three direct competitors engaged in the bidding process solicited by Blues. Z Valet had offered to provide overflow parking in another lot in the vicinity and Blues incorporated that overflow capacity in a proposed valet parking plan to be submitted to the City. Plaintiff alleged that in an Aug. 1, 1994, fax from Steven Strauss to Z Valet, which contained the proposed plan, Blues admitted that it was going to use Z Valet for the provision of valet parking services. Plaintiff also alleged that Blues transmitted, via fax, its August calendar to Z Valet. Throughout the months of July, August, September and October 1994, telephone discussions were held between Z Valet and Blues, wherein the parties negotiated all relevant contract terms for Z Valet to provide valet parking services. On Oct. 19, 1994, a luncheon meeting was held between Blues and Z Valet, wherein Blues allegedly formally offered the valet parking contract to Z Valet. The plaintiff alleged a handshake confirmed the deal, and Daniel Ziv (president of Z Valet) requested a written confirmation of the deal. On Oct. 27, 1994, Steve Strauss, allegedly on behalf of Blues, transmitted a letter to Daniel Ziv. The purported letter agreement provided, in pertinent part, "We Commit to Your Taking the Lot on November 13th. You Will Operate Rent Free Til Jan 1, 1995." VPSI alleged it was totally unaware of the correspondence or negotiations between Blues and Z Valet. The next day, Blues wrote, "Ken Harris informed me late today that he would like to bid out the valet parking based on a different criteria that what I gave you." Then, on Oct. 31, 1994, defendant Kenneth Harris (chief operating officer and chief financial officer of Blues) sent a request for proposal (RFP) to Daniel Ziv, in which Blues informed Z Valet that it had "selected Z Valet to bid on the valet parking contract for the facility at 8430 Sunset Blvd." The plaintiff alleged that the pricing criteria of the RFP (consisting of blanks to be filled in) were composed by VPSI and adopted by Blues as part of a conspiracy to rig a false bidding process and to defraud Z Valet. In November 1994, Blues awarded its valet parking services contract to VPSI. According to Blues, Z Valet refused to bid and VPSI had bid $7,900 per month more than Z Valet offered and $9,500 per month more than another bidder. The plaintiff claimed that on Dec. 12, 1994, defendant Herb Citrin, bragged to a third party that he had conspired with to deprive Z Valet of the valet parking contract for Blues and that he had written the sham RFP for the valet parking contract. *** SEE "THE RESULT" FOR CONTINUATION
Settlement Discussions
No demands were made. Per plaintiff, Blues offered $75,000 at the settlement conference. Per defendants, no firm offer was made.
Damages
The plaintiff claimed damages of $3 million.
Result
*** CONTINUATION OF FACTS: The plaintiff brought this action against defendants based on Cartwright Act violations, breach of contract, unjust enrichment, fraud, conspiracy to defraud, statutory and common law unfair competition, intentional interference with prospective economic advantage, intentional interference with contractual relations and misappropriation of trade secrets.
Other Information
Plaintiff's antitrust expert, Robert Mallory (McDermott, Will & Emery in L.A.) was barred from testifying after examination under Evidence Code º402. The defendants then moved for nonsuit on all causes of action. The motions were granted as to all causes of action and all defendants, except for the breach of contract claim against Blues. The case went to the jury on the issue of the ostensible authority of specified representatives of Blues to enter into a 4 1/2 month contract, if any. The verdict was reached approximately one year and 11 months after the case was filed. SETTLEMENT CONFERENCE: A settlement conference was held on Oct. 14, 1997, before the Hon. Paul Boland of the Los Angeles Superior Court. It did not resolve the matter. POST TRIAL MOTIONS: A statement of decision on the nonsuit motions remains to be settled. Motions for new trial and judgment notwithstanding the verdict are pending. The successful defendants will be moving for an award of attorney fees for their defense of the trade secret claims.
Deliberation
3½ days
Poll
12-0 (liability); 9-3 (damages)
Length
18 days
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