William J. Madden vs. N. Arthur astor

Motion for Summary Judgment/Adjudication

Cal. Super. - 4th Dist.May 12, 2015

10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law RUTAN & TUCKER, LLP Milford W. Dahl (State Bar No. 39796) mdahl@rutan.com Gerard M. Mooney (State Bar No. 222137) gmooney@rutan.com 611 Anton Boulevard, Suite 1400 Costa Mesa, California 92626-1931 Telephone: 714-641-5100 Facsimile: 714-546-9035 Attorneys for Defendant and Cross- Complainant N. ARTHUR ASTOR SUPERIOR COURT OF THE STATE OF CALIFORNIA FOR THE COUNTY OF ORANGE, CENTRAL JUSTICE CENTER WILLIAM J. MADDEN aka BILL MADDEN, Plaintiff, Vs. N. ARTHUR ASTOR aka ART ASTOR aka NOUBAR ARTHUR ASTOR aka NUBAR ARTHUR ASTOR and DOES 1 to 50, inclusive, Defendants. N. ARTHUR ASTOR,an individual, Cross-Complainant, Vs. WILLIAM J. MADDEN, an individual, and ROES 1 to 10, inclusive, Cross-Defendants. Case No. 30-2015-00787160 ASSIGNED FOR ALL PURPOSES TO HON. KIRK NAKAMURA DEFENDANT AND CROSS- COMPLAINANT N. ARTHUR ASTOR’S NOTICE OF MOTION AND MOTION FOR SUMMARY JUDGMENT, OR, IN THE ALTERNATIVE, SUMMARY ADJUDICATION OF ISSUES AND MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF [Declarations Of N. Arthur Astor And Gerard M. Mooney, Request For Judicial Notice, Separate Statement Of Undisputed Material Facts, And Proposed Order Filed Concurrently] Date Action Filed: May 12, 2015 Trial Date: Not Assigned Hearing Date: April 7, 2016 Time: 2:00 p.m. Department: C15 Reservation: 72289094 2562/031470-0002 8944084.5 a12/23/15 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law NOTICE OF MOTION AND MOTION TO THE HONORABLE COURT, AND TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD: PLEASE TAKE NOTICEthat on April 7, 2016 at 2:00 p.m., or as soon thereafter as the matter may be heard in Department C15 of the above-entitled Court, located at 700 Civic Center Drive West, Santa Ana, California, defendant N. Arthur Astor (“Astor”) will and hereby does move the Court for summary judgment pursuant to Section 437¢ ofthe California Code of Civil Procedure, on the grounds that there is no genuine issue as to any material fact and that Astor is entitled to judgment as a matter of law on all pending causes of action asserted by plaintiff William J. Madden (“Madden”). PLEASE TAKE FURTHER NOTICE that if, for any reason, the Court does not grant summary judgment, Astor hereby moves in the alternative for an Order pursuant to Section 437¢c(f) of the California Code of Civil Procedure entering summary adjudication in Astor’s favor on each cause of action asserted by Madden in the Complaint, based on the following grounds: Issue No. 1: Madden’s Second Cause of Action for “Fraud” is barred by the applicable statute of limitations. Issue No.2: Madden’s Third Cause of Action for “Negligent Misrepresentation” is barred by the applicable statute of limitations. Issue No.3: Madden’s First Cause of Action for “Theft” is barred by the applicable statute of limitations. Issue No.4: Madden’s Fourth Cause of Action for “Conversion”is barred by the applicable statute of limitations. Issue No. 5: Madden’s Second Cause of Action for “Fraud” and Third Cause of Action for “Negligent Misrepresentation” fail as a matter of law because Madden cannot establish the necessary elements of false statements made by Astor or an intention by Astor not to perform the parties’ agreement. Il -1- 2562/031470-0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 a12/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law Issue No. 6: Madden’s Fourth Cause of Action for “Conversion” fails as a matter of law because Madden cannot establish the necessary element of Astor’s obtaining or retaining Madden’s property by way of wrongful conduct. Issue No. 7: Madden’s First Cause of Action for “Theft” fails as a matter of law because Madden cannot establish the necessary elements of Astor’s obtaining Madden’s property by “false or fraudulent representation or pretense” or with an intent to defraud Madden or of Madden’s property having been stolen by a third party and given to Astor. Issue No. 8: Madden’s Fifth Cause of Action for “Constructive Trust/Lien”fails as a matter of law because it does notstate a legally cognizable independent cause of action. This Motion is made on the grounds that there are no triable issues of material fact as to Madden’s First through Fifth Causes of Action, and, therefore, Astoris entitled to summary judgmentor, in the alternative, summary adjudication of such causes of action. This Motion is based upon this Notice of Motion and Motion; the attached Memorandum of Points and Authorities; the Declarations of N. Arthur Astor and Gerard M. Mooney and the exhibits attached to the declarations; the Request for Judicial Notice; Astor’s Separate Statement of Undisputed Material Facts; all pleadings, records and files herein, all matters of which judicial notice may be taken; and upon such additional evidence or argument as the Court may receive at or priorto the hearing on this Motion. Dated: December 23,2015 RUTAN & TUCKER, LLP MILFORD W. DAHL GERARD M. MOONEY By: Gerard M. Mooney Attorneys for Defendant and Cross- Complainant N. ARTHUR ASTOR De 2562/03 1470-0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 al2/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law TABLE OF CONTENTS Page L SUMMARY OF ARGUMENTcotinineaa 1 II. FACTUAL HISTORYLovinsesetnens 4 A. THE PArtIES ....ccviieriiieiienciesteesseeerstesess e ener see eens 4 B. The Parties’ AGIEEMENT. ......c..ccviiiiiiierieiie siressreeeresessere erste sree 4 C. Madden Participates In Astor’s Auction Of His Automobile Collection In 2008 And Threatens Suit As An “Investor” In KSPA ...................... 5 D. Madden Attempts To Broker Loans For KSPA In 2010 And Acknowledges The FCC’s Failure To Approve An Upgrade Of The STAtION’S SIGNAL 1..veiiiiiiiirieieiieeeseeseterseters sbeebs eres eres tens 5 E. Madden Repeatedly Acknowledges The Future Sale OfKSPA As A Precondition To His Right To Payment Under The Parties’ AGIEEIMCIIT 1...etere sbeebs sree b aes e see ste sera e sabe beert neste enree eres 6 F. Madden Files The Instant Action, Alleging Purported Misrepresentations By Astor And A Right To Immediate Payment....................... 7 II. STANDARD ON MOTION FOR SUMMARY JUDGMENT OR ADJUDICATIONLoitaestes ete abet e serene anne 8 IV. ASTOR IS ENTITLED TO SUMMARY JUDGMENT PURSUANT TO THE EXPIRATION OF ALL APPLICABLE STATUTES OF LIMITATIONS «coerceseerssetestebe steers seb ens eres eensere sere aes 9 A. Madden’s “Fraud” And “Negligent Misrepresentation” Causes Of Action Are Barred By Expiration Of The Applicable Statutes Of LIMIEALIOIIS ..evitreneiiete certo sie etceterasbeebs tsb ev esses stb ese n tener ete ese senate ere anns 9 B. Madden’s Cause Of Action for Conversion Fails As A Result Of The Running Of The Statute Of Limitations...........cccoovveeoveioveveoineeisie eee, 11 C. Madden’s “Theft” Claim Is Time-Barred ...........ccoovevvriiviiiiivcieciscece, 11 V. EVEN WERE MADDEN’S CLAIMS NOT TIME-BARRED, EACH CLAIM FAILS SUBSTANTIVELY AS A MATTER OF LAW...coooovvviiieeeeeeeien 11 A. Madden Cannot Establish His Fraud Or Negligent Misrepresentation CLAIMSceterastessosee b esse ea sneer ese n ens 11 1. Astor’s Purported Representations Regarding His Experience and Station Ownership and Sales Were Accurate .......c..ooovveveeenvereeeennen. 13 2. Astor’s Alleged Predictions Regarding KSPA’s Value and the Timing of the Station’s Upgrade and Sale Cannot Constitute Fraud .........ccoviiiiiiiiiresee ee13 2562/031470-0002 8944084.5 a12/23/15 -i- DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY JUDGMENT/ADJUDICATION 1 Page 2 3. Madden’s Allegations That Astor Did Not Intend to Perform the Parties” Agreement Are Demonstrably False ........cccocoevevivviiineene.o, 14 4. Madden’s Contentions Regarding His Purported “Security” 4 Interests in Astor’s Automobiles Fail as a Matter of Law ..........c..coo.o...... 15 5 B. Madden Cannot Establish His Cause Of Action For Conversion .........ovvvvvevvvenn. 16 6 C. Madden Cannot Establish His Claim For Theft Under Cal. Penal Code § 484 n s16 D. Madden Cannot Establish His Claim For Theft Under Cal. Penal 8 COC § A060eeeeeeeee eee eereereaes 17 9 E. Astor’s Claim For “Constructive Trust/Lien” Is Not Legally COZNIZADLE.....coieiiiiiiie aera18 10 » VI CONCLUSIONwo...esveseeeseeeeseeeseseseesossssseese sees eseeees sessoese 18 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP ~1i- attorneys at law ||e002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 al12/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law TABLE OF AUTHORITIES Page(s) CALIFORNIA CASES Aguilar v. Atlantic Richfield Co. (2001) 25 Calidth 826oiieeeeersteeters8 Bernson v. Browning-Ferris Industries (1994) 7 Caldth 926 orereeneas 10 Dell Merk, Inc. v. Franzia (2005) 132 Cal.APP.Ath 443 oceans3,15 First Nat. Bank in Richmond v. Thompson (1943) 00 CALAPD.2A 79 ieeeetestes11 Fremont Indem. Co. v. Fremont General Corp. (2007) 148 CalLAPP.AtN 07 ctseterseee16 Glue-Fold, Inc. v. Slautterback Corp. (2000) 82 Cal.APP.Ath TOLELorieeeeeersteesterases enna4,18 Graham v. Bank ofAm., N.A. (2014) 226 CalLAPP.Ath S94oiieen3,12,13, 14 Intrieri v. Superior Court (2004) 117 CalLAPP.AR 72ooteeeeeeeeeeteereereseereebeere een3,11, 12,13 Jolly v. Eli Lilly & Co. (1988) 44 Cal.3d 1103 oiieeeseersereseters eet stents arenes 10 Kline v. Turner (2001) 87 CalLAPP.Ath 13609iiiees3,9,10 Laabs v. City of Victorville (2008) 163 Cal.APP.Ath 1242 iiiceteraeases n steerer eens ere tenens 8,9 PCO, Inc. v. Christensen, Miller, Fink, Jacobs, Glaser, Weil & Shapiro, LLP (2007) 150 CalAPDP.Ath 384 s3,16 Peart v. Ferro (2004) 119 CalLAPP.Ath 60octcereersteeesens 8 People v. Ashley (1954) 42 Cal.2d 246 c..ooviiiee ens17 People v. Fujita (1974) 43 CalLAPP.3A 454Looeeterna16, 17 -11i- 2562/031470-0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 al2/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law Page(s) CALIFORNIA CASES (CONT.) People v. Love (2008) 166 Cal.APDP.Ath 1292Loonieeeeeters17 People v. Marsh (1962) SB CAL2A 732oriceteetaaan 17 Stansfield v. Starkey (1990) 220 CalADPDP.3A 59oieetereeevee 18 Tarmann v. State Farm Mut. Auto. Ins. Co. (1991) 2 CalADPP.Ath 153oii,3,12, 14 Utility Consumers’ Action Network, Inc. v. AT&T Broadband ofSouthern Cal., Inc. (2006) 135 CalLAPP.Ath 1023oieeeeeeeeeeerento8 CALIFORNIA STATUTES Code of Civil Procedure SECTION 338(C) vvrivetimietiiieeiieees eectssteererete eter estes resets eres eben ete et enenes2,9,11 SECTION 338) 1.vviieeirerieieeecteectsaerateerate anes 2,9, 10 SECTION A37C(C) 1uveviiieeietetictestestesters tsetse teas eee et eter etter eee ees 8 SECLION 437C(0), (DIZ) reavereestorebsites eter essesteteraeeeerent eterna 8 Commercial Code SECTION 92032) .euvevierieieee irisesstereoseer eee cette este eres e eee eeeeee eeeeae3,15 Penal Code SECTION 484...ieeeeeeeeeeee estes eeeeres eee erent tere n eee eae anaes 16,17, 18 SECTION 484) .virvererireirii eerstereecesesters seer teeta e tetas ener enone seen 16 SECTIONS A8A/A00eecteeeeeeceeeeeeeeeeeeeeerates 18 SECLION400...eeeeee eee eterseeeere2,17, 18 SECHIOM AO) ve .vevevererireeteiterer estes eestoreset esse sees erste reeset esto eeter net enone eens 17,18 SECTION BOT...eeeeeeeee eee eee eeeeeeeeeerates2,911 SECTION 03), (C).veureverireiieietiisieee eerste teeter eres eestor beste b eres esos terete ere as essere atest ear ener 11 Vehicle Code SECTIOTL 030]octetseeeeters er eerste eters eset tates estes ees ones eeene ene eee aera esas ene ssears 15 OTHER AUTHORITIES 2 Witkin, CAL. CRIM. LAW (4th ed. 2012) § 72 uiiiiiiieoee ceoceeeeeens 17 5 Witkin, SUMM, CAL. LAW (10th ed. 2005) § 774 o.oo ov eeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeee eee eeeeeeeas 14 -iv- 2562/031470-0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 89440845 a12/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys af law MEMORANDUM OF POINTS AND AUTHORITIES Defendant N. Arthur Astor (“Astor”) moves this Court for summary judgment or, in the alternative, summary adjudication of plaintiff William J. Madden’s (“Madden”) claims on the following grounds, which are more fully addressed below: ® Madden’s claims are barred by the applicable statutes of limitations. ® Madden’s claims for “Fraud” and “Negligent Misrepresentation” fail as a matter of law because Madden canriot establish the necessary element of false statements made by Astor or an intention by Astor not to perform the parties’ agreement, and because Astor’s alleged statements constitute non-actionable opinions. ° Madden’s claim for “Conversion” fails as a matter of law because Madden cannot establish the necessary element of Astor’s obtaining or retaining Madden’s property by way of wrongful conduct. ® Madden’s claim for “Theft” fails as a matter of law because Madden cannot establish the necessary elements of Astor’s obtaining Madden’s property by “false or fraudulent representation or pretense” or with an intent to defraud Madden. ® Madden’s claim for “Receiving Stolen Property”fails as a matter of law because Madden cannot establish the necessary element of Madden’s property having been stolen by a third party and given to Astor. ® Madden’s claim for “Constructive Trust/Lien” fails as a matter of law because it does notstate a legally cognizable independent cause of action. I. SUMMARY OF ARGUMENT. On August 1, 2006, Madden and Astor - two longtime friends and business associates - made a straightforward agreement, set forth in a one-page letter signed by both parties. (Declaration of N. Arthur Astor [“Astor Decl.””], 99 5, 8, Ex. A.) Madden agreed to sell Astor a car and certain memorabilia for $75,000, and to provide $200,000 toward upgrading the signal for Astor’s radio station KSPA (“KSPA™). (Astor Decl., § 8, Ex. A.) In return, Astor agreed that “lu]pon the sale of [KSPA],” Madden would receive $275,000, “plus 2.75% ofthe net proceeds [of the sale] over $10 million dollars,” with the payment obligation “to be collateralized” by -1- 2562/031470-0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 a12/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law Astor’s “unencumbered” automobiles. (/bid.) The parties’ written agreement contained no deadline for the sale of KSPA or the resulting payment to Madden. (/bid.) Astor thereafter engaged in documented and public efforts to obtain necessary FCC approval to upgrade KSPA’s signal and to sell the station. (/d., §9 6-7; Request for Judicial Notice [“RIN”], Exs. 1-7.) Madden was contemporaneously aware of Astor’s efforts, acknowledging them in writing. (Astor Decl., § 12, 14, Exs. C, E.) As recently as April 2014, Madden also acknowledged, consistent with the parties’ agreement, that he would be paid on his “investment” in KSPA “at the sale of the station.” (Astor Decl., § 17, Ex. H.) Nevertheless, on May 12, 2015, Maddenfiled this lawsuit seeking immediate payment from Astor on the parties’ agreement, despite KSPA’s not yet having been sold. (Declaration of Gerard M. Mooney [“Mooney Decl.”], § 2, Ex. L..) Madden alleges Astor obtained his money and property in 2006 through misrepresentations regarding the upgrade and sale of KSPA, Astor’s experience in the industry and selling radio stations, and Astor’s intention to perform the parties’ agreement. (Mooney Decl., § 2, Ex. L at 3:14-20, 4:8-18.) Further, Madden claims Astor no longer holds any “unencumbered” automobiles, thus eliminating the purported “security” for Madden’s “investment.” (Id. at 7:9-15.) On those bases, Madden asserts claims against Astor for “Theft,” “Fraud,” “Negligent Misrepresentation,” “Conversion,” and “Constructive Trust/Lien.” (Id, § 2, Ex. L.) Each of Madden’s claims fails as a matter of law. Astoris entitled to judgment in his favor because all of Madden’s claims are barred by the applicable three-year statutes of limitations. (Code Civ. Proc., § 338(d) [three-year statute of limitations for fraud and negligent misrepresentation]; Code Civ. Proc., § 338(c) [three-year statute of limitations for conversion]; Pen. Code, § 801 [three-year statute of limitations for theft under Pen. Code, § 496].) The purported events giving rise to Madden’s claims - Astor’s various representations, his acquisition of Madden’s money and property, and his transfer of automobiles - occurred between 7 and 9 years before Madden filed this action. (Mooney Decl., 42, Ex. L at 3:1-7:4.) Moreover, at least as early as 2008, Madden was aware of Astor’s purported wrongdoing, and threatened to file suit against Astor. (Astor Decl., § 10, Ex. B.) Madden’s failure to file this action until 2015, many years beyond the expiration of all applicable statutes of 2- 2562/031470-0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 al2/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law limitations,entitles Astor to a judgmentin his favor. (Kline v. Turner (2001) 87 Cal.App.4th 1369, 1374.) Even were they not barred by the applicable statutes of limitations, Madden’s claims fail substantively. On his “Fraud” and “Negligent Misrepresentation” causes of action, Madden cannot establish the element of Astor’s having made false statements of fact or of his intention to perform the parties’ agreement. (/ntrieri v. Superior Court (2004) 117 Cal.App.4th 72, 85-86.) In addition, a number of Madden's alleged “misrepresentations” constitute non-actionable statements of opinion concerning value or predictions of future events, and thus cannot support a claim for “fraud.” (Graham v. Bank ofAm., N.A. (2014) 226 Cal.App.4th 594, 607; Tarmann v. State Farm Mut. Auto. Ins. Co. (1991) 2 Cal.App.4th 153, 158.) With regard to Astor’s intention to perform the parties’ agreement, the Astor entity that currently owns KSPA - Ontario Broadcasting, LLC (“Ontario Broadcasting”) - is party to a contract for the sale of KSPA that would assure Madden receives the $275,000 payment under the parties” 2006 agreement. (Astor Decl., § 21.) Madden’s claims also fail to the extent they arise out of Astor’s transfer of interests in his “unencumbered” automobiles. A security interest only attaches to collateral “when it becomes enforceable against the debtor with respectto the collateral[.]” (Comm. Code, § 9203(a).) Here, the only obligation “to be collateralized” pursuant to the 2006 agreement - Astor’s obligation to pay Madden - will not arise until KSPA is sold, an event Madden acknowledges has not yet occurred. (Astor Decl., § 8, Ex. A; Mooney Decl, 2, Ex. L at 6:26-7:1.) Madden thus has no present security interest in Astor’s automobiles. (Comm. Code, § 9203(a).) Moreover, even if Madden were a secured party (which he is not), Madden would only have the right to take possession of the cars in the event of a default. (Dell Merk, Inc. v. Franzia (2005) 132 Cal.App.4th 443, 456.) Here, there is no default, because no paymentis yet due. Madden’s claim for “Theft” also fails as a matter of law. Astor did not obtain any cash or property from Madden “based upon false or fraudulent representations or pretenses” or otherwise “in a manner that constitutes theft” as Madden alleges. (Mooney Decl., § 2, Ex. L at 11:14-17, 14:7-8.) Madden likewise cannot establish any “wrongful act toward or disposition of the property” by Astor as is required for his “Conversion” claim. (PCO, Inc. v. Christensen, Miller, 3- 2562/03 1470-0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 al2/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys af law Fink, Jacobs, Glaser, Weil & Shapiro, LLP (2007) 150 Cal.App.4th 384, 395 [quoting McKell v. Washington Mutual, Inc. (2006) 142 Cal.App.4th 1457, 1491].) Madden’s purported claim for “Imposition of Constructive Trust or Lien”fails as a matter of law because it is “not an independent cause of action but merely a type of remedy for some categories of underlying wrong.” (Glue-Fold, Inc. v. Slautterback Corp. (2000) 82 Cal.App.4th 1018, 1032 n.3 [internal citation omitted].) That remedy is “dependent upon a substantive basis for liability,” and thus fails with Madden’s substantive claims. (/bid.) Simply stated, Madden has no viable claims against Astor, and Astor is entitled to judgment against Madden as a matter of law. Astor respectfully requests that the Court grant his Motion and enter judgmentin his favor on each and all of Madden’s causes of action. II. FACTUAL HISTORY. A. The Parties. Astoris the manager of Ontario Broadcasting, which owns radio station KSPA, located in Ontario, California. (Astor Decl., § 6.) After graduating from USC in 1949, Astor went into radio broadcasting, and subsequently held positions in sales, sales management, and station management, buying his first radio station in 1978. (Id., 9 2-3.) In 2003 and 2004, Astor sold that station and another for a combined $53 million. (/d., 3.) Astor also collects classic cars, some of which he exhibits at the Astor Classics Event Center in Anaheim (the “Event Center”). (Idatg4.) Madden and Astor were friends for many years, and sometimes did business with one another. (Id, § 5; Mooney Decl., § 2, Ex. L at 3:21-24.) Madden owned or was affiliated with several businesses, including The Private Money Group, a lending firm. (Astor Decl., § 5.) Madden - a car enthusiast like Astor - additionally sold cars to Astor and bought cars from Astor, and occasionally assisted at the Event Center. (/d., 9 5; Mooney Decl, 2, Ex. L at 3:9-10.) B. The Parties’ Agreement. Beginning in 2004, Astor sought the FCC’s approval for an upgrade of KSPA’s signal from 10,000 watts to 50,000 watts, in an effort to make the station more attractive for sale. (Astor Decl., § 6; RIN, Exs. 1-7.) In August 2006, Madden and Astor reached an agreement whereby A4- 2562/031470-0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 a12/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law Madden would provide $200,000 to help fund the upgrade, and would sell Astor a car and certain memorabilia for $75,000. (Astor Decl., 99 8-9, Ex. A.) In return, upon the sale ofKSPA, Astor would pay Madden $275,000, plus 2.75% ofthe net proceeds of the sale over $10 million. (/bid.) On August 1, 2006, Madden and Astor signed a letter setting forth the terms of their agreement. The letter provides, in relevant part: I owe you $275,000 to be collateralized by the unencumbered automobiles in my collection. Upon sale of KSPA/Ontario you will receive from me $275,000 plus 2.75% of the net proceeds over $10 million dollars (sale price, less indebtedness and monies owed to key employees). (Ibid.; Mooney Decl., 2, Ex. L at Ex. A, § 3.) C. Madden Participates In Astor’s Auction Of His Automobile Collection In 2008 And Threatens Suit As An “Investor” In KSPA. In June 2008, Astor held an auction ofhis car collection, selling over 200 cars and hundreds of items of memorabilia. (Astor Decl., § 10.) Madden participated in the auction, and had a dispute with Astor regarding his (Madden’s) sale of a car at the auction. (/bid.) In the course ofthat dispute, on September 17, 2008, Madden sent an e-mail in which he referred to himself as “an investor in the radio station 1510 ‘the Spa.” (Id., J 11, Ex. B.) In that same e-mail, Madden wrote that he was “prepared to begin litigation on Mr. Astors [sic] refusal to keep me informed about the financial status ofthe radio station for the last three years,” and that he believed such litigation was “in my best interest.” (/bid.) Madden also referenced having hired an attorney. (/bid.) Madden did not institute any such action. (Id, § 11.) D. Madden Attempts To Broker Loans For KSPA In 2010 And Acknowledges The FCC’s Failure To Approve An Upgrade Of The Station’s Signal. In August 2010, Astor Broadcast Group signed a loan proposal from Madden’s entity The Private Money Group (“PMG”) seeking a loan to pay for the upgrades to KSPA to which Madden had contributed in August 2006. (Astor Decl., § 12, Ex. C.) In connection with Astor’s efforts to obtain a loan, Astor informed Madden and PMG that FCC approval had not yet been obtained for the subject upgrades, and that KSPA had not yet been sold. (/bid.) PMG failed to obtain a loan, and on March 28, 2011, Astor wrote to PMG on the matter. (Id, § 13, Ex. D.) -5- 2562/03 1470-0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 al2/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law Madden responded on April 5, 2011. (Id, q 14, Ex. E.) In his letter, Madden referenced “the long anticipated FCC power upgrade permit for KSPA[.]” (/bid.) E. Madden Repeatedly Acknowledges The Future Sale Of KSPA As A Precondition To His Right To Pavment Under The Parties’ Agreement. In late May 2013, Madden asked Astor to advise him ofthe status of KSPA’s upgrade and sale and when he should expect payment. (Astor Decl., 9 15.) Following their conversation, on May 30, 2013, Madden faxed Astor a copy ofthe parties’ 2006 agreement. (/d., 9 15, Ex. F.) In a letter sent on June 5, 2013, Astor reminded Madden that he was only obligated to pay Madden “[u]pon the sale of KSPA/Ontario,” and stated that he would advise Madden as soon as a sale took place. (/d., q 16, Ex. G.) Astor further noted that he did not hold any “unencumbered” automobiles, in light of the 2008 auction in which Madden participated and a pledge of automobiles to the Astor Family Foundation. (/bid.) Madden did not respond. (Id., § 16.) On April 1, 2014, Madden sent Astor a letter, stating that he “need[ed] [Astor’s] help to maintain [his] income stream,” and asking that Astor agree to make “[a] $5,000.00 monthly or $10,000 quarterly principal reduction” on his “investment” in KSPA. (/d., § 17, Ex. H.) Madden did not claim Astor immediately owed him payment or had not worked sufficiently to upgrade and sell KSPA. (/bid.) Rather, Madden wrote, consistent with the parties’ 2006 agreement, “the balance owed at the sale of the station” would be “paid at the closing of the sale.” (/bid.) On April 16, 2014, Astor responded to Madden. (/d., 9 18, Ex. I.) Astor wrote that while he “appreciate[d] and empathize[d] with [Madden’s] cash flow problems,” he himself was “unable to begin making payments to [Madden] even if they were required under the terms of the note at this time.” (/bid.) However, Astor noted, the parties’ agreement did not require such payments until “the sale of KSPA/Ontario,” which had not yet occurred. (Ibid) Astor again advised Madden there were no “unencumbered” automobiles, as any proceeds from the sale of his cars “would be required to go into the Astor Family Foundation.” (/bid.) Astor further assured Madden that he “plan[ned] to make payment to [Madden]” under the 2006 agreement. (/bid.) On June 12, 2014, Madden again wrote to Astor, this time asking whether Astor might want to discuss a potential sale of KSPA to Cumulus Media of Atlanta, Georgia. (Id, 919, Ex. I.) -6- 2562/031470-0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 al2/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law Madden asked whether Astor’s “brokers had any serious discussion regarding KSPA 1510 AM, [and] if so, whatthe situation” was at that time. (/bid.) Madden’s letter made no mention of any obligation by Astor to pay Madden before a sale of KSPA, nor did Madden accuse Astor of failing to diligently work to upgrade and sell the station. (Ibid.) F. Madden Files The Instant Action, Alleging Purported Misrepresentations By Astor And A Right Te Immediate Payment. Maddenfiled the instant action on May 12, 2015. (Mooney Decl., § 2, Ex. L.) In his Complaint, Madden alleges that he provided Astor the cash, car and memorabilia in 2006 in light of his friendship with Astor, as well as Astor’s representations that he previously sold a radio station for $40 million and that Madden “would make a huge windfall profit by upgrading KSPA/Ontario and promptly increasing its resale value from $10 million to $35-$45 million.” (/d. at 5:3-5.) In addition, Madden alleges, Astor represented in 2006 that the approval for and upgrades to KSPA’s signal “would be completed very soon” and “KSPA/Ontario would be sold within six months to a year.” (Id. at 6:2-4.) Madden alleges that after he provided Astor the cash and property, Astor told him “there had been some delays in obtaining the necessary license” from the FCC to upgrade KSPA, (Id. at 6:21-25.) However, Madden alleges, Astor claimed that he “retained former California Governor Deukmejian to assist in expediting the FCC license application.” (Ibid) Madden allegesthat Astor claimed to have “two radio brokers actively working on selling the radio station.” (Ibid.) Madden acknowledges KSPA “never did receive the appropriate FCC licenses or permits” for the station upgrades, and that “KSPA/Ontario has never been sold.” (Id. at 6:26-7:1.) However, Madden alleges, “Astor has never actually marketed the radio station for sale, nor has he made any reasonable efforts to sell” KSPA, because he “never had any intention of actually selling” KSPA. (Jd. at 7:1-4.) Madden further alleges that Astor informed him “for the first time ever” in June 2013 that Astor no longer had any unencumbered automobiles, because any “proceeds” from such automobiles were pledged to the Astor Family Foundation. (/d. at 7:9-13.) Based on these allegations, Madden asserts claims against Astor for “Theft,” “Fraud,” “Negligent Misrepresentation,” “Conversion,” and “Constructive Trust/Lien.” (Id, q 2, Ex. L.) -7- 2562/031470-0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 89440845 al2/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law III. STANDARD ON MOTION FOR SUMMARY JUDGMENT OR ADJUDICATION. “Summary judgment is granted when a moving party establishes the right to the entry of judgment as a matter of law.” (Utility Consumers’ Action Network, Inc. v. AT&TBroadband of Southern Cal., Inc. (2006) 135 Cal.App.4th 1023, 1027 [citing Code Civ. Proc., § 437¢(c)].) When a defendant moves for summary judgment,the initial burden is on the defendant to make a primafacie showing that one or more elements of the challenged cause of action “cannot be established,” or that a “complete defense” exists thereto. (Code Civ. Proc., § 437¢(0), (p)(2); Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 861-862.) “A defendant moving for summary judgment may meet the burden of showing that a cause of action has no merit by (a) negating an essential element of that cause of action; (b) establishing a complete defense to that cause of action; or (¢) demonstrating the absence of any evidence to support the plaintiff's case.” (Peart v. Ferro (2004) 119 Cal.App.4th 60, 69.) Once the defendant meets this burden, the burden shifts to the plaintiff to prove through admissible evidence that a triable issue of material fact exists as to the challenged causes ofaction. (Ibid.) “The plaintiff. . . may not rely upon the mere allegations or denials of his pleadings . . but, instead, must set forth the specific facts showing that a triable issue of material fact exists as to that cause ofaction or a defense thereto.” (Aguilar v. Atlantic Richfield Co., supra, 25 Cal.4th at 849 [quoting Code Civ. Proc., § 437¢(0)(2)].) “There is a triable issue of material fact if, and only if, the evidence would allow a reasonable trier of fact to find the underlying fact in favor of the party opposing the motion in accordance with the applicable standard of proof.” (Id. at 850.) cel Importantly, “‘[t]he pleadings delimit the issues to be considered on a motion for summary 99 11]judgment,” and where a defendant moves for summary judgment “‘the plaintiff cannot bring up new, unpleaded issues in his or her opposing papers.”(Laabs v. City of Victorville (2008) 163 Cal.App.4th 1242, 1253 [quoting Turner v. State ofCalifornia (1991) 232 Cal.App.3d 883, 891 and Government Employees Ins. Co. v. Superior Court (2000) 79 Cal.App.4th 95, 98-99 n.4].) To create a triable issue of fact, the plaintiff must direct its opposition evidence “‘to issues raised by the pleadings.” (Laabs v. City of Victorville, supra, 163 Cal.App.4th at 1253 [quoting Distefano v. Forester (2001) 85 Cal.App.4th 1249, 1264-1265].) If the plaintiff's opposing evidence -8- 2562/031470-0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 al2/23/15 JUDGMENT/ADJUDICATION 10 1 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law “‘would show some factual assertion, legal theory, defense or claim not yet pleaded,”he “‘should seek leave to amend the pleadings before the hearing on the summary judgment motion.”(/bid.) IV. ASTOR IS ENTITLED TO SUMMARY JUDGMENT PURSUANT TO THE EXPIRATION OF ALL APPLICABLE STATUTES OF LIMITATIONS. “Generally, statute of limitations issues raise questions of fact that must be tried, however, when the uncontradicted facts are susceptible of only one legitimate inference, summary judgment is proper.” (Kline v. Turner, supra, 87 Cal.App.4th at 1374 [citing Jolly v. Eli Lilly & Co. (1988) 44 Cal.3d 1103, 1112].) Here, there can be no dispute that the conduct underlying Madden’s claims occurred at least 9 years ago, and that Madden was aware of Astor’s purported wrongdoing between 7 and 9 years ago. (Mooney Decl., § 2, Ex. L at 3:1-7:4.) As a result, the three-year statutes of limitations applicable to Madden’s claims expired well before he filed this action in 2015, barring those claims as a matter of law. (Code Civ. Proc., § 338(d) [three-year statute of limitations for fraud and negligent misrepresentation]; Code Civ. Proc., § 338(c) [three-year statute of limitations for conversion]; Pen. Code, § 801 [three-year statute of limitations for theft].) A. Madden’s “Fraud” And “Neglisent Misrepresentation” Causes Of Action Are Barred By Expiration Of The Applicable Statutes Of Limitations. A cause of action for fraud or negligent misrepresentation is subject to a three-year statute of limitations. (Code Civ. Proc., § 338(d).) As explained by the Court of Appeal in Kline v. eeTurner, supra, 87 Cal.App.4th 1369, a claim of fraud is “deemed accrued” upon ““the discovery, 393,by the aggrieved party, of the facts constituting the fraud or mistake’: The courts interpret discovery in this context to mean not when the plaintiff became aware of the specific wrong alleged, but when the plaintiff suspected or should have suspected that an injury was caused by wrongdoing. The statute of limitations begins to run when the plaintiff has information which would put a reasonable person on inquiry. A plaintiff need not be aware of the specific facts necessary to establish a claim since they can be developed in pretrial discovery. Wrong and wrongdoing in this context are understood in their lay and not legal senses. (Kline v. Turner, supra, 87 Cal.App.4th at 1373-1374 [quoting Code Civ. Proc., § 338(d) and citing Jolly v. Eli Lilly & Co. (1988) 44 Cal.3d 1103, 1110-111].) Underthis “discovery rule,” where a person suspects or should suspect he suffered an injury as a result of another person’s 9. 2562/03 1470-0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 a12/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law wrongdoing, that person “must go find the facts” and “cannot wait for the facts to find [him].” (Jolly v. Eli Lilly & Co., supra, 44 Cal.3d at 1110.) In addition, “[a]ggrieved parties generally need not know the exact manner in which their injuries were ‘effected, northe identities of all parties who may have played a role therein” in order for the statute of limitations to run. (Bernson v. Browning-Ferris Industries (1994) 7 Cal.4th 926, 932.) Here, when Madden became aware of Astor’s specific purported misrepresentations or particular alleged conduct is irrelevant; rather, what matters is “when [Madden] suspected or should have suspected that an injury was caused” by Astor’s alleged wrongdoing. (Kline v. Turner, supra, 87 Cal.App.4th at 1374.) The Complaint makes clear the purported fraud - Astor’s alleged representations and non-disclosures - occurred in 2006, 9 years before Madden filed this action. (Mooney Decl., § 2, Ex. L at 3:1-7:4.) However,at least as early as 2008, Madden was aware of Astor’s purported wrongdoing, including his failure to upgrade KSPA’s signal and sell the station, and Astor’s sale of his automobiles at an auction in which Madden participated. (Astor Decl., § 10, Ex. B.) Further, in an e-mail Madden sent on September 17, 2008, Madden referred to himself as “an investor in the radio station 1510 ‘the Spa’” and wrote that he had spoken with attorneys and was “prepared to begin litigation on Mr. Astors [sic] refusal to keep me informed aboutthe financial status ofthe radio station for the last three years[.]” (Ibid. [emphasis added].) Although Madden wrote that he believed filing an action against Astor was “in [his] best interest,” Madden filed no litigation against Astor until nearly 7 yearslater, when he filed this action in May 2015. (/d., 99 10-11; Mooney Decl., § 2, Ex. L.) Likewise, on June 3, 2010, Madden prepared a “loan proposal” to Astor on behalf of PMG, in which Madden proposed a potential loan of $1,000,000 to “upgrade radio station transmitters,” again acknowledging that KSPA had not yet been upgraded or sold, the very facts he alleges underlie his claims. (Astor Decl., § 12, Ex. C.) Madden’s knowledge of alleged wrongdoing - including several of the very matters of which Madden now complains - caused the statute of limitations on Madden’s “Fraud” and “Negligent Misrepresentation”claims to begin to run between at least 7 and 9 years ago, and to expire well before Madden filed this action, entitling Astor to judgment in his favor. (Code Civ. Proc., § 338(d).) -10- 2562/031470-0002 DEFENDANT N., ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 al2/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law B. Madden’s Cause Of Action for Conversion Fails As A Result Of The Running Of The Statute Of Limitations. A cause of action for conversion is subject to a three-year statute of limitations. (Code Civ. Proc., § 338(c).) That statutory period begins to run at the moment of conversion, even where the plaintiff is ignorant of his rights. (First Nat. Bank in Richmond v. Thompson (1943) 60 Cal.App.2d 79, 83 [“The fact that the appellant had no knowledge of its cause of action does not toll the statute of limitations where there has been an actual conversion.”].) Here, the statute of limitations began to run in August 2006 when Astor acquired Madden’s money and property, and expired no later than 2009, six years before Madden filed this action. (Astor Decl., | 8, Ex. A; Mooney Decl., § 2, Ex. L at 5:13-27.) Under any circumstance, this claim fails as a matter of law. C. Madden’s “Theft” Claim Is Time-Barred. A cause of action for theft is subject to a three-year statute of limitations. (Pen. Code, § 801.) The statute is not subject to any “tolling,” and begins to run upon discovery of the offense. (Pen. Code, § 803(a), (¢).) As addressed above, Madden was aware of Astor’s purported wrongful conduct no later than 2008, as he acknowledged in writing. (Astor Decl., 9 12, Ex. C.) Thestatute of limitations onthis claim thus expired at least four years before Madden filed this action. (Pen. Code, § 801.) Judgment should thus be entered on this claim in favor of Madden. V. EVEN WERE MADDEN’S CLAIMS NOT TIME-BARRED, EACH CLAIM FAILS SUBSTANTIVELY AS A MATTER OF LAW. Assuming - contrary to fact and law - that Madden’s claims were not barred by the applicable statutes of limitations, those claims still fail substantively as a matter of law. Put simply, there are no disputed issues of material fact on any of Madden’s causes of action, several of which wholly fail to state a cognizable claim. As a result, Astoris entitled to judgment in his favor on each of those claims. A, Madden Cannot Establish His Fraud Or Neglicent Misrepresentation Claims. As the Court of Appealin Intrieri v. Superior Court, supra, 117 Cal.App.4th 72 (“Intrieri”), explained, “[t]he elements of a cause of action for fraud and a cause of action for negligent misrepresentation are very similar,” and “[p]ursuant to Civil Code section 1710, both -11- 2562/031470.0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 al2/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law torts are defined as deceit.” (Id. 85.) However, the Intrieri court noted, “the state of mind requirements” differ between the two torts: Fraud is an intentionaltort, the elements of which are (1) misrepresentation; (2) knowledge offalsity; (3) intent to defraud, i.e., to induce reliance; (4) justifiable reliance; and (5) resulting damage. Negligent misrepresentation lacks the element of intent to deceive. Therefore, [w]here the defendant makes false statements, honestly believing that they are true, but without reasonable ground for such belief, he may be liable for negligent misrepresentation, a form of deceit. (Id. at 85-86 [internal quotations and citations omitted].) As set forth in Madden’s Complaint, the bases for his “Fraud” and “Negligent Misrepresentation” causes of action are Astor’s purported oral representations that (1) Astor had been in the radio business for 40 years and “bought, sold and owned a number ofradio stations” (Mooney Decl., § 2, Ex. L at 3:14-15); (2) Astor had previously sold a radio station for more than $40 million (id. at 3:15-17, 4:13-14, 6:6-7); (3) KSPA had a current value of $10 million, but after upgrading its signal from 10,000 to 50,000 watts would, “in [Astor’s] opinion,” be worth between $35 and $40 million (id. at 4:14-17); (4) Astor “intended to complete the upgrade and then sell [KSPA] within 6-12 months” (id. at 4:17-18, 6:3-4); (5) Madden “would make a huge windfall profit by upgrading [KSPA] and promptly increasing its resale value from $10 million to $35-$45 million” (id. at 5:4-5); (6) Astor agreed “to collateralize the $275,000 in cash and property being provided from Madden to Astor by all the cars in Astor’s collection” (id. at 5:8-12); and (7) KSPA’s signal upgrades would be complete “very soon” (id. at 6:1-3). Madden further alleges Astor “never had any intention of actually selling” KSPA and did not do so. (Id. at 7:3-4.) None of the alleged representations or failures to disclose information supports Madden’s claims for “Fraud” or “Negligent Misrepresentation: The representations regarding Astor’s industry experience and prior radio station sales and the upgrade and sale of KSPA were true, or otherwise consisted of non-actionable predictions of future events or statements of value. (Graham v. Bank ofAm., N.A., supra, 226 Cal.App.4th at 607; Tarmann v. State Farm Mut. Auto. Ins. Co., supra, 2 Cal.App.4th at 158.) Conversely, Madden’s allegation that Astor did not intend to perform the parties’ agreement is demonstrably false. -12- 2562/03 1470-0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 12/23/15 JUDGMENT/ADJUDICATION 10 1 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law 1. Astor’s Purported Representations Regarding His Experience and Station Ownership and Sales Were Accurate. The alleged statements upon which Madden claims to have relied regarding Astor’s experience owning and selling radio stations and upgrading and selling KSPA are demonstrably true. As aresult, those statements cannot form the basis of a claim for “fraud” or “negligent misrepresentation.” (Graham v. Bank ofAm., N.A., supra, 226 Cal.App.4th at 605-606 [holding that false representation is a necessary element of a claim for fraud]; Intrieri v. Superior Court, supra, 117 Cal.App.4th at 85-86 [holding that a false statement is a necessary element of a claim for negligent misrepresentation].) Madden alleges Astor represented he was in the radio business for 40 years and “bought, sold and owned a number of radio stations.” (Mooney Decl., § 2, Ex. L at 3:14-15) Astor in fact began in the radio business in 1949, and boughthisfirst station in 1978. (Astor Decl., 992-3.) Over the ensuing years, Astor - through various entities - owned, bought and sold several radio stations, including KIKF-FM, KTIM-AM, KTIM-FM, KFSD-AM, KFSD-FM, KCEO-AM and KSPA-AM. (/d.,9 3.) Astor additionally sold several radio stations prior to his deal with Madden, including KIKF-FM in 2003 and KFSD-FM in 2004, among others. (/bid.) Madden alleges Astor claimed he had sold a radio station for more than $40 million before Astor and Madden entered into their agreement. (Mooney Decl., § 2, Ex. L at 3:15-17, 4:13-14, 6:6-7.) In fact, in 2003 and 2004,just prior to his agreement with Madden, Astor sold KIKF-FM for $35 million and KFSD-FM for $18 million, a combined total of $53 million, more than the $40 million in sales Madden alleges Astor represented. (Astor Decl., 3.) 2. Astor’s Alleged Predictions Regarding KSPA’s Value and the Timing of the Station’s Upgrade and Sale Cannot Constitute Fraud. Madden alleges Astor represented KSPA had a current value of $10 million, which would increase to “between $35 and $40 million” after an upgrade of KSPA’s signal. (Mooney Decl., 92, Ex. Lat4:14-17, 5:4-5.) In addition, Madden claims, Astor represented the upgrade would be complete “very soon” and the sale would be final within six to twelve months. (Id. at 4:17-18, 6:1-3.) Such statements are not actionable as a matter of law. -13- 2562/031 470-0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 al2/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law As for the supposed representation regarding KSPA’s value, “[r]epresentations of opinion, particularly involving matters of value, are ordinarily not actionable representations of fact.” (Graham v. Bank ofAm., N.A., supra, 226 Cal.App.4th at 606-607; see, also, Tarmann v. State Farm Mut. Auto. Ins. Co., supra, 2 Cal.App.4th at 158.) Rather, a statement expressing a person’s judgment of value is an opinion, and is not actionable as fraud. (Graham v. Bank ofAm., N.A., supra, 226 Cal.App.4th at 607 [citing 5 Witkin, SUMM. CAL. LAW (10th ed. 2005) Torts, § 774, p. 1123].) Here, Madden candidly acknowledges that Astor stated the potential future value of the station “in his opinion[.]” (Mooney Decl., § 2, Ex. L at 4:14-17 [emphasis added].) Similarly, Astor’s purported representation regarding when KSPA’s signal upgrade would be complete, and Madden’s potential resulting “profit,” are not actionable. “‘It is hornbook law that an actionable misrepresentation must be made about past or existing facts.” (Graham v. Bank ofAm., N.A., supra, 226 Cal.App.4th at 607 [quoting Neu-Visions Sports, Inc. v. Soren/McAdam/Bartells, supra, 86 Cal,App.4th at 309-310].) Astor’s purported predictions of future events cannot form the basis of a claim for fraud or negligent misrepresentation. 3. Madden’s Allegations That Astor Did Not Intend to Perform the Parties’ Agreement Are Demonstrably False. Madden alleges Astor had no intention of performing the parties’ agreement, but represented during the parties’ negotiations that he would perform. (Mooney Decl., 42, Ex. L at 7:1-4.) This allegation is completely and irrefutably false. As discussed above, Astor, through Ontario Broadcasting, has sought FCC approvalto upgrade KSPA’s signal from 10,000 watts to 50,000 watts since at least 2004, as reflected in publicly-available documents submitted to the FCC. (Astor Decl., § 6; RIN, Exs. 1-7.) Unfortunately, those efforts have been obstructed by third parties. (Astor Decl, § 7; RIN, Exs. 1- 7.) Astor continues to pursue FCC approval of the upgrade. (Astor Decl., § 7.) In addition, Astor has contracted with various brokers since the parties’ entry into their agreement. (Astor Decl., § 21, Ex. K.) Astor also obtained a loan proposal from Madden’s own entity, PMG, in 2010 seeking money for the planned upgrade and eventual sale efforts, as Madden is aware. (/d., § 12, Ex. C.) Ontario Broadcasting is also now party to a contract with a third party -14- 9562/031470-0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 a12/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 2] 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law which grants that party the right to purchase KSPA for approximately $2 million if Astor cannot obtain the signal upgrade. (Astor Decl., 21.) Any claim by Madden that Astor has not performed or did not intend to perform is false. 4. Madden’s Contentions Regarding His Purported “Security” Interests in Astor’s Automobiles Fail as a Matter of Law. In support of his “Fraud” and “Negligent Misrepresentation” claims Madden alleges that Astor agreed “to collateralize the $275,000 in cash and property being provided from Madden to Astor by all the cars in Astor’s collection].]” (Mooney Decl., § 2, Ex. L at 5:8-12.) Madden alleges that in June 2013 Astor told him “for the first time” that he did not have any “unencumbered” cars because “Astor had transferred all of the cars in his collection to the Astor Family Foundation.” (/d. at 7:12-13.) Madden contends any such transfer “was . . . done in detriment to Madden's rights because all of the transferred cars represented collateral for Astor’s debt to Madden.” (/d. at 7:26-28.) This contention fails for several reasons. A security interest only attaches to collateral “when it becomes enforceable against the debtor with respectto the collateral[.]” (Comm. Code, § 9203(a).) The plain language ofthe parties’ agreement states that the obligation “to be collateralized” - stated as a future, rather than a present occurrence - is Astor’s obligation to pay Madden, which does not arise until KSPA is sold. (Astor Decl, § 8, Ex. A.) It is undisputed that KSPA has notyet sold, and so Madden has no present interest in Astor’s automobiles. (Comm. Code, § 9203(a).) Madden has thus suffered no “detriment” as a result of any transfer of those automobiles. Moreover, even assuming Madden had a present security interest in the automobiles - which he does not - the parties’ contract grants him no right to collect upon that security interest prior to default. (Astor Decl, 9 8, Ex. A.) Absent such a right, Madden cannot take possession of the automobiles until occurrence of a default. (Dell Merk, Inc. v. Franzia, supra, 132 Cal.App.4th at 456 [holding that “[p]rior to default” the right to collect upon security “exist[s] only if Consistent with his lack of a current interest in Astor’s cars, and with the terms of the parties’ 20006 agreement, Madden has failed to perfect any security interest in the cars under the exclusive statutory process set forth at Vehicle Code section 6301. (Astor Decl., 22.) Madden simply has no interest to perfect or enforce, and his contention otherwise is pure litigation afterthought. -15- 2562/031470.0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 a12/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law contractually agreed upon by the parties”].) Here, not only does Madden hold no present security interest in Astor’s cars, but the parties’ agreement grants him no right to exercise any such interest prior to a default. Madden’s claim regarding his supposed security interest thus fails. B. Madden Cannot Establish His Cause Of Action For Conversion. The elementsofthe tort of conversion are (a) plaintiff's ownership or right to possession of personal property, (b) defendant’s disposition of property in a manner inconsistent with plaintiff's property rights, and (c) resulting damages. (See, Fremont Indem. Co. v. Fremont General Corp. (2007) 148 Cal.App.4th 97, 119.) The plaintiff thus must establish a “wrongful act toward or disposition of the [plaintiff's] property.” (PCO, Inc. v. Christensen, Miller, Fink, Jacobs, Glaser, Weil & Shapiro, LLP, supra, 150 Cal.App.4th at 395 [internal quotations omitted].) Here, Madden alleges that “[o]n or about and after August 1, 2006, Defendants took possession of and converted to their own use the cash and merchandise . . based upon false and fraudulent representations and pretenses[.]” (Mooney Decl., § 2, Ex. L at 14:6-8.) Madden additionally alleges that Astor hid his conversion of Madden’s money and property by way of “false pretenses and concealment of material facts[.]” (/d. at 14:11.) As addressed above, Astor obtained and utilized the $200,000 Madden provided for purposes consistent with the parties’ written agreement, to wit, to upgrade KSPA’s signal and otherwise prepare the station for sale. (Astor Decl., 49 13, 20.) Further, as established with regard to Madden’s claims for “Fraud” and “Negligent Misrepresentation,” Astor did not make any misrepresentations to obtain or keep Madden’s money or property. (See, supra, § V.A.) Astor is entitled to judgment on this claim. C. Madden Cannot Establish His Claim For Theft Under Cal. Penal Code § 484. California Penal Code section 484(a) imposesliability upon any person who, in relevant part, “[k]nowingly and designedly, by any false or fraudulent representation or pretense, defrauds another person of money, labor, or real or personal property.” (Pen. Code, § 484(a).) The elements of the offense are generally stated as (a) intent to defraud (“knowingly and designedly™); (b) actual fraud committed (“defraud any other person”); (¢) false pretenses (“false or fraudulent representation or pretense”); and (d) causation (reliance on the false representation). (People v. Fujita (1974) 43 Cal.App.3d 454, 467.) -16- 2562/031470-0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 al2/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP aftorneys at law Pursuantto the language of Penal Code section 484, intent to defraud is an essential clement of the crime. (See, People v. Ashley (1954) 42 Cal.2d 246, 264 [whether pretense is false promise or misrepresentation of fact, defendant’s intent must be proved in both instances by something more than mere proof of nonperformance or actual falsity]; People v. Fujita, supra, 43 Cal.App.3d at 474 [theft by false pretenses requires both false representation and intent to defraud].) As a result,if the defendant showsthat he honestly and reasonably believed his representation was true, he cannot be convicted. (People v. Marsh (1962) 58 Cal.2d 732, 736.) Here, Madden cannot prove any of the elements ofthe offense, because, as addressed above, none ofthe representations Astor allegedly made were false and no fraud was committed. Moreover, as established above, Astor believed his statements were truthful. (See, supra, § V.A.) Madden cannot establish that Astor acted with “intent to defraud,” as he must to succeed on his claim. (See, People v. Ashley, supra, 42 Cal.2d at 264; People v. Fujita, supra, 43 Cal.App.3d at 474.) Rather,it is undisputed that Astor has consistently and repeatedly assured Madden that he intends to pay him pursuant to the terms of the parties’ agreement. (Astor Decl., 99 8,23, Ex. A.) Given Madden’s indisputable inability to satisfy the elements of Penal Code section 484, Astor is entitled to summary adjudication of this claim. D. Madden Cannot Establish His Claim For Theft Under Cal. Penal Code § 496. Penal Code section 496 “applies to a person who buys or receives property that has been stolen or obtained by theft or extortion, knowing that the property is stolen or so obtained, or who personally or by aiding another conceals, sells, or withholds the property from the owner, knowing the property to be stolen or so obtained.” (2 Witkin, CAL. CRIM. LAW (4th ed. 2012) § 72, p. 117.) Thethree essential elements of the offense under Penal Code section 496(a) are: (a) property obtained by another person by theft or extortion; (b) the defendant’s receiving, concealing, selling, or withholding the property; and (c) the defendant’s knowledge ofthe theft or extortion. (/bid.) “Courts have long held that one cannot be charged for theft and receipt of the same property.” (People v. Love (2008) 166 Cal.App.4th 1292, 1298.) The Legislature has codified this well-settled principal. (Pen. Code, § 496(a) [“[N]o person may be convicted both pursuant to this section and of the theft of the same property.”].) As Madden’s allegations make clear (Mooney -17- 2562/031470-0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 a12/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys af law Decl., § 2, Ex. L at 10:8-13, 11:20-21), he fundamentally misunderstands both the meaning and purpose of Penal Code section 496. Madden alleges that Astor “received Madden’s cash and property based on false or fraudulent representations or pretenses and in a manner than constitutes theft under Penal Code § 484.” (Mooney Decl., § 2, Ex. L at 11:14-17.) However, Madden’s allegations make clear the property was not stolen when Astor received it. (Id. at 10:8-13, 11:20-21.) Madden confuses the acts ofstealing property, and receiving already stolen property. (Id. at 10:8-13, 11:20-21.) One cannot be convicted of bothas to the same property. (Pen. Code, § 496(a).) Plainly, Maddenstated this cause of action in a misguided attemptto create a claim for treble damages. TheCourt should summarily adjudicatethis cause of actionin favor of Astor. E. Astor’s Claim For “Constructive Trust/Lien” Is Not Legally Cognizable. Madden’s purported claim for “Imposition of Constructive Trust or Lien” fails as a matter of law because it does notstate a cause of action. A “constructive trust” or lien is “not an independent cause of action but merely a type of remedy for some categories of underlying wrong.” (Glue-Fold, Inc. v. Slautterback Corp., supra, 82 Cal.App.4th at 1023 [internal citation omitted].) Because the remedy is “dependent upona substantive basis for liability,”it fails with Madden’s substantive claims, addressed herein. (Ibid.; see, also, Stansfield v. Starkey (1990) 220 Cal.App.3d 59, 76 [“In their third amended complaint appellants alleged, as causes of action, a resulting trust and a constructive trust. But neither is a cause of action (citations omitted), only a remedy.”].) This supposedcause ofaction should besummarily adjudicatedin Astor’s favor. VI. CONCLUSION, For the foregoing reasons, Astor respectfully requests that the Court enter judgmentin his favor on Madden’s Complaint. Alternatively, Astor respectfully requests that the Court summarily adjudicate each of Madden’s First Cause of Action for Theft (Penal Code §§ 484/496); ll] / -18- 2562/031470-0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 al2/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Rutan & Tucker, LLP attorneys at law Second Cause of Action for Fraud; Third Cause of Action for Negligent Misrepresentation; Fourth Cause of Action for Conversion; and Fifth Cause of Action for Constructive Trust/Lien. Dated: December 23, 2015 RUTAN & TUCKER, LLP MILFORD he DAHL GERARDf OONEY,/ (By:YA//Iv)Lr Gerard M. Mooney yd / Attorneys for Defendantand Cross- Complainant N. ARFHUR ASTOR -19- 2562/031470-0002 DEFENDANT N. ARTHUR ASTOR'S MOTION FOR SUMMARY 8944084.5 a12/23/15 JUDGMENT/ADJUDICATION 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 PROOF OF SERVICE STATE OF CALIFORNIA, COUNTY OF ORANGE I am employed by the law office of Rutan & Tucker, LLP in the County of Orange, State of California. I am over the age of 18 and not a party to the within action. My business addressis 611 Anton Boulevard, Suite 1400, Costa Mesa, California 92626-1931. My electronic notification address is cmakenen@rutan.com. On December 23, 2015, I served on the interested parties in said action the within: DEFENDANT ARTHUR ASTOR’S NOTICE OF MOTION AND MOTION FOR SUMMARY JUDGMENT OR, IN THE ALTERNATIVE, SUMMARY ADJUDICATION OF ISSUES as stated below: James M. Duarte, Esq. Duarte & Associates 245 Fischer Avenue, Suite A-1 Costa Mesa, CA 92626 jduarte(@duarte-law.com (BY MAIL) by placing a true copy thereof in sealed envelope(s) addressed as shown above. [1] (BY E-MAIL) by transmitting a true copy of the foregoing document(s) to the e-mail addresses set forth above. In the course of my employment with Rutan & Tucker, LLP, I have, through first-hand personal observation, become readily familiar with Rutan & Tucker, LLP’s practice of collection and processing correspondence for mailing with the United States Postal Service. Under that practice, I deposited such envelope(s) in an out-box for collection by other personnel of Rutan & Tucker, LLP, and for ultimate posting and placement with the U.S. Postal Service on that same day in the ordinary course of business. If the customary business practices of Rutan & Tucker, LLP with regard to collection and processing of correspondence and mailing were followed, and I am confident that they were, such envelope(s) were posted and placed in the United States mail at Costa Mesa, California, that same date. I am aware that on motion of party served, service is presumed invalid if postal cancellation date or postage meter date is more than one day after date of deposit for mailing in affidavit. Executed on December 23, 2015, at Costa Mesa, California. I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct. NS Debbie Corwin LL & (Type or print name) (Signature) 2152/031470-0002 8592998.1 a10/27/15