Facts

Plaintiff LA Properties Investment Inc. is in the business of purchasing promissory notes secured by real property. In 2010, Santee Investments LLC owned a property located at 1144-1146 San Julian Street, Los Angeles that was encumbered by a Deed of Trust as security for a promissory note ("the Santee Note") in favor of Hanmi Bank. Defendants Ramin Saghian and Hoshang Saghian ("collectively the Saghians") were guarantors of the Santee Note.

On March 1, 2010, LA Properties, through its principal Rahim "Ray" Golbari, offered to Hanmi Bank to purchase the Santee Note for $2,450,000 with a 35 percent cash down payment.

In April 2010, LA Properties entered into a contract with Hanmi Bank to purchase the Santee Note. LA Properties opened an escrow for the purchase, however, on July 27, 2010, the escrow was cancelled and the plaintiff was refunded his deposit. The Santee Note was subsequently purchased by Spring Management Company, an entity owned by Mark Omid Bolour for $2,450,000 with a 40 percent cash down payment.

Prior to July 28, 2010, the Saghians first learned that Center Bank was interested in 5 promissory notes secured by four separate properties in downtown Los Angeles and received a due diligence package from Bolour, including all the details about the notes. On July 12, 2010, and July 28, 2010, Bolour made two offers to Center Bank to purchase the 5 Notes. On Aug. 30, 2012, LA Properties made an $11 million offer to Center Bank to purchase the 5 Notes.

LA Properties did not disclose any information to the Saghians regarding the 5 Notes until meeting with the Saghians between, Sept. 6-8, 2010. In those meetings, LA Properties and the Saghians never discussed forming an entity for a joint venture, management or control of the joint venture's business, or how costs or losses would be allocated. At the time of these meetings, LA Properties had not contacted with Center Bank to purchase the 5 Notes.

On Sept. 15, 2010, an entity controlled by Bolour signed a contract with Center Bank to purchase the 5 Notes. Between Sept. 6-8, 2010, the Saghians did not disclose to Bolour the content of their conversations with LA Properties.

On Sept. 27, 2010, the Bolour entity cancelled the contract with Center Bank.

On Sept. 29, 2010, Bolour's broker, Robin Yi, contacted Ramin Saghian to inquire whether he had interest in purchasing the 5 Notes. Ramin Saghian indicated that he was willing to offer $11 million to Center Bank for the purchase of the 5 Notes. Yi communicated the Saghian's offer to Center Bank, which responded that the lowest amount it would accept to sell the 5 Notes was $11.5 million, which was communicated to Ramin Saghian. Yi recommended Ramin Saghian agree to purchase the 5 Notes for $11.5 million.

On Oct. 1, 2010, the Saghians, through their entity Carmelina Property LLC, signed a purchase agreement with Center Bank to purchase the 5 Notes for $11.5 million. The 5 Notes were ultimately purchased by Center Capital Group LLC, an entity formed by the Saghians for that amount.

On May 6, 2011, LA Properties filed an action against the Saghians arising out of the Santee Note and the 5 Notes.

On Aug. 30, 2011, LA Properties filed a first amended complaint asserting causes of action for fraud and deceit, breach of fiduciary duty, breach of oral contract, breach of oral joint venture agreement, rescission, conspiracy to defraud, aiding and abetting breaches of fiduciary duty for personal gain, fraudulent conveyance, interference with contractual relations, and interference with prospective economic advantage.

PLAINTIFF'S CONTENTIONS:
As to the Santee Note, LA Properties alleged that LA Properties assigned the Santee Note to the Saghians' designee and negotiated a cash discount in the purchase price of the Santee Note in reliance on the Saghians' fraudulent promise to pay LA Properties a $52,000 fee and 50 percent of the cash discount in the amount of $70,000 (total sum of $87,000).

As to the 5 Notes, LA Properties claimed that a joint venture was formed between LA Properties and the Saghians for the purchase of the 5 Notes, in reliance on said agreement, LA Properties disclosed to the Saghians confidential information about the Center Bank's sale of the 5 Notes, and the Saghians fraudulently, in breach of their fiduciary duties, and in breach of their joint venture agreement, purchased the 5 Notes for their own benefit. LA Properties claimed that it is entitled to damages in excess of $2,087,000, plus interest and punitive damages.

DEFENDANT'S CONTENTIONS:
As to the Santee Note, the Saghians claimed that LA Properties never assigned any rights it claimed to have in the Santee Note to any person or entity, and even if it did, the assignment was unenforceable under the statute of frauds since it was not in writing; the ultimate buyer was not the Saghians' designee; and the ultimate buyer of the Santee Note never received a discount in the purchase price of the Santee Note.

As to the 5 Notes, the Saghians claimed that no joint venture was ever formed between LA Properties and the Saghians; and no confidential information was disclosed because the Saghians already knew all the details about the 5 Notes more than a month before LA Properties' disclosure.

Result

Judgment for dismissal of the entire action in favor of defendants Ramin Saghian and Hoshang Saghian and against plaintiff LA Properties Investment Inc.

Other Information

The Saghians filed a Motion of Summary Judgment or in the Alternative for Adjudication of Issues. The court denied that Motion for Summary Judgment, but partially granted summary adjudication. As to the Santee Note, the court held that there was no actual assignment agreement as to the 5 Notes. As to the 5 Notes, the court held that no joint venture agreement was created between LA Properties and the Saghians and that the Saghians' statements regarding contribution of funds to the joint venture was too vague to support a fraud claim and LA Properties failed to establish the existence of any definite promise; the Saghians were aware of details of the 5 Notes prior to LA Properties' disclosure to the Saghians of the 5 Notes; LA Properties' prior offer of $11 million was not stamped confidential; LA Properties failed to produce any evidence to support that it detrimentally relied on the Saghians' statement that the Saghians did not indicate "any familiarity" with the 5 Notes; and LA Property did not have a contract for the purchase of the 5 Notes, therefore LA Properties fails to establish any out-of-pocket loss with respect to the 5 Notes and failed to establish entitlement to recover lost profits because LA Properties failed to establish triable issues of fact that a joint venture was established. Therefore, the court granted summary adjudication as to breach of fiduciary duty, breach of joint venture, rescission and for aiding and abetting breaches of fiduciary duty for personal gain. Summary adjudication was denied as to fraud and deceit, conspiracy to defraud, fraudulent conveyance, interference with contractual relations, interference with prospective economic advantage based on the Santee Note, but granted as to the 5 Notes. Also, the court granted summary adjudication for breach of contract to the extent based on an assignment and denied as to the extent based on an agreement to negotiate the purchase price. Subsequently, the Saghians filed a Motion for Judgment on the Pleadings arguing that LA Properties' remaining claims were based on alleged oral promise/agreement by which LA Properties was to receive a fee for assisting Santee LLC with the purchase of an indebtedness that is secured by real property, which was in violation of the statute of frauds. Right before the commencement of trial, the court granted the Saghians' Motion for Judgment on the Pleadings, holding that the contract to receive a fee or commission must be in writing under Civil Code section 1624, and since LA Properties did not have any such agreement in writing, its claims are barred under the statute of frauds. The court then proceeded to enter a judgment for dismissal in favor of the Saghians and against LA Properties.