Del Mar Seafoods,Inc v. Cohen et al

MOTION in Limine

N.D. Cal.April 28, 2008

1 DEFENDANTS MOTION IN LIMINE NO. 1 SFO 405155v2 0084289-000001 Case No. C-07-2952-WHA 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 D A V IS W R IG H T T R E M A IN E L L P James P. Walsh, CSB. No. 184620 Gwen Fanger, CSB No. 191161 DAVIS WRIGHT TREMAINE LLP 505 Montgomery Street, Suite 800 San Francisco, California 94111-3611 Telephone: (415) 276-6500 Facsimile: (415) 276-6599 budwalsh@dwt.com Attorneys for Defendants and Claimant. BARRY COHEN, CHRIS COHEN (aka CHRISTENE COHEN), the F/V POINT LOMA and Claimant, F/V POINT LOMA Fishing Company, Inc. UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA SAN FRANCISCO DIVISION DEL MAR SEAFOODS, INC., Plaintiff, v. BARRY COHEN, CHRIS COHEN (aka CHRISTENE COHEN), in personam and, F/V POINT LOMA, Official Number 515298, a 1968 steel-hulled, 126-gross ton, 70.8 foot long fishing vessel, her engines, tackle, furniture apparel, etc., in rem, and Does 1-10, Defendants. ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) No. C-07-2952-WHA DEFENDANTS MOTION IN LIMINE NO. 1 TO EXCLUDE PAROL EVIDENCE REGARDING AMOUNT OF DEBT UNDER PROMISSORY NOTE AND POINTS AND AUTHORITIES IN SUPPORT THEREOF Final Pretrial Conf.: May 5, 2008 Time: 2:00 p.m. Place: Courtroom 9, 19th Floor Pursuant to Local Rule 7-1 and the Court s Guidelines for Trial and Final Pretrial Conference in Civil Bench Cases, Defendants Barry Cohen, Chris Cohen, and counterclaimant F/V Point Loma, Inc. ( Defendants ) respectfully move this Court for an order in limine to exclude certain extrinsic evidence at trial regarding the amount of Defendants debt allegedly owed under a promissory note at the time the promissory note was signed ( Motion ). This Motion is based on the following Points and Authorities, and all pleadings and other papers on file Case 3:07-cv-02952-WHA Document 146 Filed 04/28/2008 Page 1 of 29 2 DEFENDANTS MOTION IN LIMINE NO. 1 SFO 405155v2 0084289-000001 Case No. C-07-2952-WHA 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 D A V IS W R IG H T T R E M A IN E L L P in this action and on such other evidence and argument as may be received by the Court at or prior to the hearing on this Motion. MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANTS MOTION IN LIMINE NO. 1 I. INTRODUCTION By this Motion, Defendants seek to exclude certain evidence that they believe Plaintiff Del Mar Seafoods, Inc. ( Plaintiff ) will proffer at trial. Plaintiff is expected to offer oral testimony at trial by its controller, Joe Roggio, and other evidence relating to Plaintiff s contention that Defendants owed approximately $237,000 to Plaintiff at the time Defendants signed the Promissory Note (the Note ) secured by a Preferred Mortgage on Defendants fishing vessel ( Mortgage ) and not $215,000 that is expressly stated in the Note. The evidence to be presented by Plaintiff directly contradicts the amount of the debt clearly and expressly set forth in the written Note ($215,000) that was prepared by Plaintiff s own controller and signed by the Cohens at Plaintiff s request. Since evidence contradicting the unambiguous, express term of the amount owed under the Note is inadmissible, testimony and evidence on this subject must be excluded pursuant to the parol evidence rule. Defendants respectfully request an order excluding any testimony or other evidence proffered by Plaintiff that contradicts that the amount owed by Defendants under the Note at the time it was signed is anything other than $215,000 as stated unequivocally in the Note. II. STATEMENT OF FACTS Barry and Chris Cohen entered into the Note with Plaintiff on October 31, 2003 secured by the Mortgage on Defendants fishing vessel, the F/V Point Loma (the Vessel ). The Note memorializes a loan arising from a contemplated joint venture between Plaintiff s president, Joe Cappuccio and Mr. Cohen to fish in Mexico (the Mexico Joint Venture ). In connection with the Mexico Joint Venture, Joe Cappuccio, Plaintiff s president, intended to purchase a 50% interest in the Vessel. When Joe Cappuccio decided not to purchase the half interest in the Vessel, the parties agreed to convert the money already spent on the Vessel into a loan under the Note, secured by the Mortgage on the Vessel. Case 3:07-cv-02952-WHA Document 146 Filed 04/28/2008 Page 2 of 29 3 DEFENDANTS MOTION IN LIMINE NO. 1 SFO 405155v2 0084289-000001 Case No. C-07-2952-WHA 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 D A V IS W R IG H T T R E M A IN E L L P Plaintiff s controller, Joe Roggio, prepared the Note. The parties agreed that the amount covered by the Note would be $215,000. Plaintiff prepared the Note to formalize the parties agreement. The Note clearly sets forth in writing that the amount owed under the Note and Mortgage is $215,000. At all times, the only purpose of the Promissory Note was to formalize the loan associated with Joe Cappuccio s contemplated purchase of a 50% interest in the Vessel. Plaintiff will likely seek to introduce evidence that the Note should have covered approximately $237,000 at the time it was signed and not $215,000. However, as explained below, such evidence is barred by the parol evidence rule because such evidence directly contradicts the express terms of the parties final agreement as to the amount of the Note. III. ARGUMENT Extrinsic evidence contradicting the express terms of amount of the debt covered by the Note and Mortgage at the time they were signed is barred by the parol evidence rule. Cal. Civ. C. §1625; Cal. C. Civ. P. §1856(a). The parol evidence rule prohibits the introduction of extrinsic evidence whether oral or written, to vary, alter, or add to the terms of an integrated written instrument. Casa Herrera, Inc. v. Nasser Beydoun (2004) 32 Cal. 4th 336, 343 (quoting Alling v. Universal Mfg. Corp. (1992) 5 Cal. App. 4th 1412, 1433). Extrinsic evidence may be offered to explain the terms of an agreement only when it is relevant to prove a meaning to which the language of the agreement is reasonably susceptible. 250 LLC v. Photopoint Corp. (2005) 131 Cal. App. 4th 703, 725. Extrinsic evidence is not relevant to contradict the terms of an agreement that is clear and unambiguous. See e.g., BMW of N. Am., Inc. v. New Motor Vehicle Bd. (1984) 162 Cal. App. 3d 980, 991. The parol evidence rule is based on the premise that the written instrument represents the agreement of the parties. Bionghi v. Metropolitan Water Dist. (1999) 70 Cal. App. 4th 1358, 1364. Where the writing is intended to be an integration or complete and final expression of the parties agreement, then evidence varying the express terms is barred. Id. Here, the Note is the final, formalized expression of the loan agreement between the parties. Plaintiff s own controller prepared the Note and it was intended to formalize the loan arrangement between the parties Case 3:07-cv-02952-WHA Document 146 Filed 04/28/2008 Page 3 of 29 4 DEFENDANTS MOTION IN LIMINE NO. 1 SFO 405155v2 0084289-000001 Case No. C-07-2952-WHA 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 D A V IS W R IG H T T R E M A IN E L L P related to Joe Cappuccio s contemplated purchase of a 50% interest in the Vessel in connection with the Mexico Joint Venture. Plaintiff had access to the records regarding the amount spent in connection with the Mexico Joint Venture. At the time the Note was signed, the parties had agreed that the amount covered by the Note was $215,000 and reduced this agreement to writing. As the Note memorializes the agreement between the parties as to the amount owed under the Note, the Note therefore represents the final agreement between the parties. Thus, the parol evidence rule applies. Parol evidence is admissible only to explain ambiguous terms of the agreement and the question is whether the terms in the Note regarding the amount covered by the Note are reasonably susceptible to the meaning urged by Plaintiff. See e.g., 250 LLC, 131 Cal. App. 4th at 725 (test of admissibility of extrinsic evidence to explain meaning of written instrument is whether offered evidence is relevant to prove meaning to which language of instrument is reasonably susceptible ). It is difficult to see how, at the time the Note was signed, the amount covered by the Note is anything other than $215,000 as expressly stated in both the Note and Mortgage. The act of writing the Note superseded all negotiations or stipulations between Plaintiff and Defendants that led to the agreement that the amount covered by the Note would be $215,000. See e.g., BMW of N. Am., 162 Cal. App. 3d 980, 990. Plaintiff s own controller prepared the Note and set forth the agreed upon amount of the Note. Any extrinsic evidence presented by Plaintiff contradicting the amount of the Note at the time it was signed is therefore barred because, as a matter of law, the agreement is the writing itself. Id. The statement of the amount covered by the Note is clear and therefore, Plaintiff may not introduce evidence that Defendants owed anything other than $215,000 under the Note at the time it was signed. IV. CONCLUSION Based on the foregoing, Defendants respectfully request that this Court exclude all oral and written evidence that Plaintiff may attempt to introduce at trial, which contradicts the expressly stated amount of the debt in the Note allegedly owed by Defendants at the time the Note was signed. Case 3:07-cv-02952-WHA Document 146 Filed 04/28/2008 Page 4 of 29 5 DEFENDANTS MOTION IN LIMINE NO. 1 SFO 405155v2 0084289-000001 Case No. C-07-2952-WHA 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 D A V IS W R IG H T T R E M A IN E L L P DATED this 11th day of April, 2008. Respectfully submitted, /s/ Gwen Fanger James P. Walsh Gwen Fanger DAVIS WRIGHT TREMAINE LLP Attorneys for Defendants, BARRY COHEN, CHRIS COHEN, F/V POINT LOMA and the F/V POINT LOMA FISHING COMPANY, INC. 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