Opposition To Lifecare Solutions Inc And Preferred Homecare Infusion LLCs Motion For Leave To File A First Amended ComplaintMotionCal. Super. - 2nd Dist.April 22, 2016Electronically FILED | la ig ht 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 28 26 27 28 py Superior Court of California, County of Los Angeles on 09/11/2019 12:27 PM Sherri R. Carter, Executive Officer/Clerk of Court, by A. Galaian,Deputy Cler Peter Dubrawski (Bar No. 65677) pdubrawski@hbblaw.com T. John Arbucci (Bar No. 249811) Jjarbucci@hbblaw.com Jessica Detering (Bar No. 311688) Jjdetering@hbblaw.com HAIGHT BROWN & BONESTEEL LLP 555 South Flower Street, Forty-Fifth Floor Los Angeles, California 90071 Telephone: 213.542.8000 Facsimile: 213.542.8100 Attorneys for Cross-Complainants, DYNAMEX, INC. and DYNAMEX OPERATIONS WEST, LLC SUPERIOR COURT OF THE STATE OF CALIFORNIA COUNTY OF LOS ANGELES, NORTH DISTRICT MELISSA SIERRA, Case No. MC026264 Plaintiff, DYNAMEX, INC. AND DYNAMEX OPERATIONS WEST, LLC’S Vv. OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED ALCEDA EXPRESS, LLC; ALBERTO HOMECARE INFUSION, LLC’S ALCEDA; ALBERTO ALCEDA, JR.; MOTION FOR LEAVE TO FILE A DYNAMEX, INC.; PREFERRED FIRST AMENDED CROSS- HOMECARE INFUSION, L.L.C.; COMPLAINT MAVERICK HEALTHCARE HOLDINGS II, INC.; LIFECARE Assigned for All Purposes to: SOLUTIONS, INC. and PREFERRED Hon. Brian C. Yep, Dept. A14 HOMECARE INFUSION, LLC, Action Filed: April 22,2016 Defendants. FSC Date; October 16, 2019 Trial Date: October 25, 2019 AND RELATED CROSS-ACTIONS. Date: September 24, 2019 Time: 8:30 a.m, Dept.: Al4 Reservation No.: 319560595376 Dynamex, Inc. and Dynamex Operations West, LLC (collectively “Dynamex”) submit the following Memorandum of Points and Authorities in opposition to LifeCare Solutions, Inc. and Preferred Homecare Infusion, LLC’s (“LifeCare’) Motion for Leave to File a First Amended Cross-Complaint (“Motion”). 1 BO13-0000001 DYNAMEX'S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE 13111061.1 INFUSION, LLC’S MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT I la ig ht © 0 J O N Wn A W O N = N N N N N N N N N = e m e m e m e d e m pe d ee e d 00 ~~ AA WU B A W N D R OO vO NN R A W = O TABLE OF CONTENTS Page I INTRODUCTION ......coiiieeee cetera reste sees e es es essen snes sae sasennes 5 II. FACTUAL BACKGROUND ...........comenronsennennssnesnsnnsassanmssis is dses s sims amme 7 A. The 2011 DTSA oe teteeee se se es eeaeeeassaesas 7 B. The 2014 ATTANZEIMICTL ........uecoveraosnnmsananennnsanssnsiss si iiss i 5 mms 43 HEHE 7 III. ARGUMENT ....oooieeeteeeeree eters s esses 11 A. Delayed and Prejudicial Efforts to Amend a Pleading Should Not Be Permitted, Despite California’s Liberal Policy Toward Amendments .......... 11 B. The Proposed Amendment May Properly be Denied As It Changes The Liability Sought to be Imposed Against DynameX........ccccoceveenuiirnnns 13 C. The Court Should Deny Leave to Amend Because the Proposed Amendment Fails to State a Valid Cause of Action Against Dynamex ........ 14 1. The Implied Contact Claim Fails As a Matter of Law...........cc......... 14 2 LifeCare Cannot Allege Contract Damages ...........cccccevvvevnincrenenne 17 3. The DTSA Was Terminated and Cannot Form the Basis of an Implied in Fact Contract .........cccceeeeevieciiiniiicniniiiiinicccieeieenens 18 BY. CONICTITSIOMN ....cooieeieioinsinsnsass esos sss sss 5a 5655508435554 Asma Ta 19 DO15-0000001 2 -- DYNAMEX’S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE INFUSION, LLC’S MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT I la ig ht OO 0 3 a Wn HA WLW O N D N O N R N R O N N N N N m mm e m e e e s e e e e e e e 0 ~~ AA hh RAR W N = S O N N Y R e w -= Oo TABLE OF AUTHORITIES Page CASES Altman v. Bautzer (1942) 54 Cal.APP.2d 543.....ococeirciriseneissmssisnsnsnassissssisansssissusssissnssenssnsss sss susansassns 18 Applied Equipment Corp. v. Litton Saudi Arabia, Ltd. (1994) T Call™ J03......conmnermi os sss sss sussessamsssissms ms mmm mamimss ss sa s T- 14 Aroa Marketing, Inc. v. Hartford Insurance Company of Midwest E201.) 198 Chl APpAth. 78 ceommsnssmmssmmmsmsiommsonnesomanmmmmnensmssssss man? 14 Banner Entertainment, Inc. v. Superior Court : (1998) 62 Cal. ApP.4th 348... miei 16 Busch v. Globe Industries (1962) 200 Cal. APP. 2d 315... ssismssasssissmsssssasasssessssasansassnsss sassssassussesss 18 California Casualty General Insurance Company v. Superior Court (1985) 173 Cal. App.3d 274 sss cxssumssssusmsnsssmmsssssmmmmsssnasasssnsssssssenssaspanporysepapgapeassenssss 14 Cantu v. Resolution Trust Corp. (1992) Cal APP Ath BE 7 sssssmsmumsmmvemssssmmsssmmomemos ay ssa mmnomsssssmssam nd ibis 17 Daum v. Superior Court (1964) 228 Cal. APP-2d 283 .....eoiiiieete es 14 Demetriades v. Yelp, Inc. (2014) 228 Cal. APP Ath 294...........ccvennninmssiasisssimmmmsssessrssssssensassssnsss sus ssasssssrsassopasmss 12 Division of Labor Law Enforcement v. Transpacific Transportation Company (1977) 69 Cal APP. 3d 268 .c.ccunssisissismmsassmmmemanssssmmsmommsmsumsssess sxvesssmanson sesvessoneonsas 15 Estate of Audie Murphy v. Gulf Insurance Company (1978) 82 Cal. APP.3d 304 ......oiiiieiiieecte ees 12 Foxborough v. Van Atta (1994) 26 Cal. APP.4th 217 .......ccoviiirinririrreinsciiisneersssesssssnssnestsstsssasassasssnssesessss 14 Friedman v. Friedman (1993) 20 Cal, App.Ath BTB...........coisssscoses suas os oman emsmmssssmesesssnsns sori sess ws 15 Green v. Rancho Santa Margarita Mortgage Company (1994) 28 Cal App Ath 686 .ccusummmmmusomsmmummonmarsses esons psa ommom cs 12 Harris v. Rudin, Richman & Appel (1999) 74 Cal. APP.4th 299.......oiiiieeieire ete 16 Higgins v. Del Faro (1981) 123 CalAPP. IA T58...cccmvmsrmonrarsamemecussmin ca ssnsas sensssnsnnss 565 ama sess ns sas sanswasesss 12 DO15-0000001 3 DYNAMEX'S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE 131110611 INFUSION, LLC’S MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT I la ig ht © 0 3 O n wn hs W N N O N O N N N N RN N N m e e m e e ee e s e s ee 0 - 1 O N Wn A W O N = O Vv N O Wn hs e W N = O Klopstock v. Superior Court (1941) 17 Cal.2d 13... 14 Kruse v. Bank of America (1988) 202 Cal. APP.3d. 38..moiiiiiiiret ees 15 Ladas v. California State Automobile Assn. (1993) 19 Cal. APP.4th 761 .....oviiiiireieite rs 15 Louis Lesser Enterprises, Limited v. Roeder (1962) 209 Cal. APP.2d. 401 ...ocmmiiiiiicei eee 15 Magpali v. Farmers Group, Inc. (1996) 48 Cal APP.A" 471 .eviciiiiiiiee ete e 12 Morgan v. Superior Court (1959) 172 CALADPD-2d 527... 12 Richman v. Hartley (2014) 224 Cal. AppP-4th 1182... 17 Siegel v. Lewis (1946) 74 CalAPD-2d 86.....ecmniiiiiieieiie tie 18 Troyk v. Farmers Group, Inc. (2009) 171 Cal. APP. 4th 1305....cmiiiiiiiii ee 17 Unilab Corp. v. Los Angeles-IPA (2016) 244 Cal. APP-4th 622.......cooviiiiiiiieiieirit ce 14 Weddington Productions, Inc. v. Flick (1998) 60 Cal.ADPD. 4th 793 ....cmiiiiieii ee 15 Yee v. Mobilehome Park Rental Review Board (1998) 62 Cal. APP.4th 1409... 14 STATUTES California Code of Civil Procedure § 473, SUDA. (2)(1) ceereeneiriiieiiriric eer 11 California Code of Civil Procedure §8 1551, 1565... terse sts ess 15 DO15-0000001 4 DYNAMEX'S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE 13111061.1 INFUSION, LLC’S MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT I la ig ht O© 0 3 a wn bh W N N N N N N N N N N m m mm p m p m ee d h m b m pe d pe d ee s 0 3 A N Un bs W N = O N D N S N N N R e w = O MEMORANDUM OF POINTS AND AUTHORITIES L INTRODUCTION Lifecare’s Motion is a prejudicially tardy attempt to infuse meritless claims into this lawsuit based on self-serving interpretations of deposition testimony and deficient legal theories. A majority of the purported evidence and depositions that LifeCare relies upon to support its requested claim for an implied in fact agreement have been in their possession for years. Only now, on the eve of trial and after the parties have submitted long cause binders on two separate occasions, do they move this court for an order allowing leave to amend. The requested claim will require significant additional discovery, motion practice, and a drastic continuance of the looming trial. The first Dynamex ever heard of an implied in fact contract theory was when LifeCare requested jury instructions on implied in fact contract and unformalized agreements in early July of 2019, when the parties submitted their initial joint list of jury instructions to the Court. (Declaration of T. John Arbucci (“Arbucci Decl.”) 92, Exh. 1.) A demonstration of the length of time LifeCare has been in possession of the documents upon which they rely is conclusive evidence of unreasonable delay. LifeCare largely relies upon the 2011 Dedicated Transportation Services Agreement between LifeCare and Dynamex (“DTSA”), which has obviously been in their possession long before this case even started. The DTSA was an exhibit to their initial cross-complaint as they were claiming breach of the DTSA as early as July 5, 2016. Although LifeCare has conceded that it has dismissed its fourth cause of action for breach of the DTSA, their purported contractual theories related to this case have existed for a number of years. LifeCare further relies on a PowerPoint presentation that was transmitted to LifeCare by Dynamex Salesperson Cody Palosaari in 2014. This document is a preliminary negotiation that has also been in their possession for years, and was produced by LifeCare in this case. The deposition of Cody Palosaari was taken on September §, 2017, and LifeCare had the PowerPoint and the DTSA in their possession custody and control at the time of his 5 EOISEI0R000) DYNAMEX'S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE 13111061.1 INFUSION, LLC’S MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT I la ig ht OO 0 ~~ O N Wu» Bs WwW N N N O N N N N O N N O N O N m m e m e m p m p m mt p m md e d oo NN O N Wn BRA W N = D O N N E R W N -= Do deposition. Mr. Paolsaari was questioned regarding the DTSA at his deposition but there was no mention of the PowerPoint presentation. Furthermore, Dynamex PMK Rick Pople identified Richard Adinolfi, Bill Dougherty and Greg Trinkaus in his deposition taken on June 1, 2017. That LifeCare chose to depose these individuals over two years after having knowledge of them is at their own peril. Accordingly, there is nothing “new” about the purported evidence and/or legal theories at issue in the Motion, and the unreasonable delay in bringing it necessitates its denial. LifeCare’s position is also legally infirm. The DTSA between Dynamex and LifeCare was terminated. (See Motion at 3:3-5). LifeCare also recently confirmed that it dismissed its fourth cause of action for breach of contract based on the DTSA. (Arbucci Decl. § 3, Exh. 2.) LifeCare conveniently omitted from its Motion that the DTSA contains mutual indemnity provisions, and also required that LifeCare indemnify and hold harmless Dynamex for the acts of LifeCare’s employees and agents. (Arbucci Decl. § 3, Exh. 2, Exh. 12.) Because the DTSA was terminated, it cannot be revived and cannot legally form the basis of an implied in fact agreement. There is also no evidence to suggest that the parties specifically re-engaged their relationship under the terms of the DTSA, only unsubstantiated conjecture. Nor can the 2014 PowerPoint presentation serve as evidence of the terms of an implied in fact agreement as it constitutes preliminary negotiations. LifeCare’s own expert Andrew Sievers also agreed that the PowerPoint was a sales pitch, and that more steps needed to be taken before an agreement was established. LifeCare seeks leave to amend to conform to proof, but by their own admission they have no evidence of damage. Accordingly, the amendment has no basis in fact or law and should not be permitted. Given the unreasonable delay in bringing their motion, the legal and evidentiary infirmities of the requested claim, and the severe prejudice that will result if the amendment is granted, Dynamex respectfully requests that LifeCare’s Motion be denied. DO15-0000001 6 DYNAMEX’S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE 13111061.1 INFUSION, LLCS MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT I la ig ht NO 0 0 N N wn t B A W NN N N N N N N NN N N m m e m e m em e m e d pe e m a 0 0 ~~ A N Un Bs W N = D O 0 N Y le W N = OO II. FACTUAL BACKGROUND A. The 2011 DTSA The 2011 DTSA was entered into between Dynamex and Preferred Homecare, LLC. (Arbucci Decl. § 4, Exh. 3.) The term of the DTSA was to be ongoing, unless terminated. (/d.) The scope of services included daily pick-ups of patient equipment and oxygen cylinder exchanges throughout Orange County. (Id) The DTSA set forth very specific compensation and payment terms that were unique to that agreement between the parties, which are set forth in Schedule B to the DTSA. (/d.) LifeCare conveniently omits from its Motion subparagraph “B” of Section 6 of the DTSA, which states in relevant part: “Shipper shall indemnify and hold Dynamex harmless from and against all claims for injury to persons, including injury resulting in death and damage to property arising out of the negligence of Shipper, its employees, agents or consignees. . . “Arbucci Decl.” § 4, Exh. 3. Regardless, by LifeCare’s own admission, the DTSA was terminated in 2012. (See Motion at 3:3-5; see also Deposition of Andrew Sievers (“Sievers Depo.”) at 172:10- 173:12) (a true and correct copy of the relevant excerpts from the Sievers Depo. is attached as Exhibit “12” to the Arbucci Decl.). B. The 2014 Arrangement In direct contravention of LifeCare’s Position in the Motion, its own PMK Oscar Julian Espinosa de Los Monteros (“Monteros™) testified that the 2011 written contract was invalid and it was LifeCare’s understanding that the parties were operating under a verbal agreement to which Monteros was able to enunciate the universe of terms: Q: Okay. And did you have - was there-it’s my understanding there was never any contract between LifeCare DO15-0000001 : 7 DYNAMEX'S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE 13111061.1 INFUSION, LLCS MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT Ha ic ht OO 0 N N NN nn BRA W N 0 NN A N Wn hs W N D = O 0 0 N Y N e W d = Oo - the LifeCare defendants in 2014 and 2015; is that your understanding? A: That - there was an assumption that the old contract was in existence. And it was, I guess - we’re finding out now it was invalid, so the asump - - (Deposition of Oscar Julian Espinosa de los Monteros (“Monteros Depo.”) 142:3-11 (a true and correct copy of the relevant excerpts from the Monteros Depo. is attached as Exhibit “4” to the Arbucci Decl.) DO15-0000001 13111061.1 Q: Did you have an understanding - you were part of that - those contractual negotiations; right? A: Correct Q: Did you have an understanding as to the terms and provisions that would apply to the relationship between the LifeCare defendants and the Dynamex defendants in 2014 through 2016? A: In terms of the agreement? Q: Yeah. A: Yeah. I think we not only had a good solid verbal, you know, understanding. Q: What were all of the terms and provisions that were verbal? A: Really providing a driver and a truck for the day for X amount of deliveries, to provide the services that we identified, in this case, primarily oxygen cylinders and pickup of equipment, and then really that their drivers were experienced, that they were clean background and they could execute the proof of delivery requirements for us in order to get paid. 8 DYNAMEX’S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE INFUSION, LLC’S MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT I la ig ht © 0 3 A N wn Bs W N 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 And, of course, there was the billing requirements, you know, associated, agreed upon rate per day and then net terms in terms of how-you know, when they want to get paid and all that good stuff. But the biggest one was - and I’ve seen it kicked around here in some of the documents, but there was a scope of service agreement that was - that was drafted by Cody. Q: Are you talking about the scope of service agreement that was sent to Sean Huckaby? A: Yes. Q: That was supposed to apply to all of the LifeCare branches at which Dynamex personnel - Dynamex was supplying personnel? [objection] A: And believe that was a working document, and I don’t think that it was ever completed in terms of, you know, the ongoing language, you know, within that scope of agreement. (Monteros Depo., Exh. 4 at 143:11-145:2.) Tellingly, there is absolutely no mention of anything related to indemnity, or any of the other unconscionable terms LifeCare seeks to impose upon Dynamex at this eleventh hour. The contention that the terms of the 2011 agreement were “ongoing” is also inconsistent and contradicted by LifeCare’s PMK and area operations manager Donald Allington’s testimony. Mr. Allington testified that it was correct that the relationship between Dynamex and LifeCare did terminate at some point in 2012 or thereabouts and that the relationship was later renewed in 2014. (See Deposition of Donald Eugene Allington at 37:22-38:1) (a true and correct copy of the Allington Depo. is attached as Exhibit “5” to the Arbucci Decl.); (Accord, Monteros Depo., Exh. 4 at 85:8-20.) By the testimony of their own experts and persons most knowledgeable, the 2011 agreement was DO15-0000001 9 DYNAMEX'S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE 13111061.1 INFUSION, LLC’S MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT I la ig ht © 0 0 NN A wn hss W N = N N O N N N N N N N mm mm e m p m e m md e e e d pe 0 NN A N Ln RAR W N = O D O N N Y R W N = Oo not ongoing, and none of the proposed contractual obligations LifeCare seeks to impose were part of the 2014 arrangement between Dynamex and LifeCare. Furthermore, the testimony of the Dynamex personnel cited by LifeCare is grossly misrepresented. During the cross-examination of lay witnesses Mr. Trinkaus, Mr. Dougherty and Mr. Adinolfi, LifeCare’s counsel asked argumentative questions seeking their opinions as to conclusions of law regarding the relationship of the parties and liability in this case, as well as to speculate as to the veracity of other people’s statements, and what these witnesses believed others meant by certain statements in emails they had no hand in drafting. The following are illustrative of the objectionable questioning/testimony LifeCare relies upon: Q: Okay. All right. So this statement by Cody would be false then? (Deposition of Greg Trinkaus, 61:23-24) Q: When you read this email, do you understand that to - - to mean that a representation is being made to a client that, let us handle the interviewing, because if something goes wrong, you may be held liable? (Deposition of Greg Trinkaus 90:9-13) Q: And so a lawsuit against my client, by your former employer, as a result of something that the independent driver did, would be inconsistent with the representation made by Cody, correct? (Deposition of Greg Trinkaus 91:7-10) Q: Okay. Meaning that, later, if there was a lawsuit because one of the independent drivers caused an accident, and you sue Preferred, meaning Dynamex sued Preferred, that would be false advertising correct? (Deposition of Greg Trinkaus 92:17-21) Q: Is that because you believe, after reading that e-mail and being part of this account, that it was represented to Preferred that, use our outsourcing tools and you'll be protected from liability? (Deposition of Greg Trinkaus 93:10-13) Q: And as a sales pitch, you understood it to be, hey, Preferred, use us, and we’ll protect you from liability? DO15-0000001 10 DYNAMEX’S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE 13111061.1 INFUSION, LLC’S MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT Ha ic ht Oo 0 9 O N wn AA W N N N N N N N N N N m m e m e m e m me p e e d ee ed 0 Nu O N Wn B R A W N = D D O N N Y N R W N = O (Deposition of Greg Trinkaus 94:12-14) 9 So if he put something in a correspondence to a perspective client or an active client, you’d think he was being truthful with them, right? (Deposition of Greg Trinkaus 95:20-22) (A true and correct copy of the relevant excerpts of the deposition of Greg Trinkaus is attached to the Arbucci Decl. as Exh. 6.) Rich Adinolfi confirmed that he had no authority to enter into any agreements with LifeCare. He is not a lawyer and his job duties at Dynamex were to supervise and generate sales for the company. (See Deposition of Richard Adinolfi (“Adinolfi Depo.”) at 60:24- 61:3) (a true and correct copy of the Adinolfi Depo. is attached as Exhibit “9” to the Arbucci Decl.) He did not draft contracts for Dynamex. (Adinolfi Depo. 63:20-64:4.) The Dynamex agreement was a generic contract that they would send to the client. If the client had any objection to any clause they would send the document back, and Mr. Adinolfi would send it to Richard Pople or Scott Leveridge who would send it to the Dynamex legal department in Dallas. (Adinolfi Depo. 64:7-17.) Mr. Adinolfi would only input the scope of work and pricing terms into the form agreement. (Adinolfi Depo. 65:13-16.) He did not have authority to sign the agreements on behalf of Dynamex. (Adinolfi Depo. 66:1-10.) He is not an expert in indemnity and has never been called to interpret an indemnity agreement. (Adinolft Depo. 68:16-69:3). Neither he, Cody Palosaari or anyone else in Dynamex sales had authority to sign an agreement on behalf of Dynamex. (Adinolfi Depo. 70:10-71:7). III. ARGUMENT A. Delayed and Prejudicial Efforts to Amend a Pleading Should Not Be Permitted, Despite California’s Liberal Policy Toward Amendments A court may, in the furtherance of justice, allow a party to amend any pleading on any terms as may be proper. (Code Civ. Proc., § 473, subd. (a)(1).) The court’s discretion will usually be exercised liberally so as not to deprive a party of the right to assert a DO15-0000001 11 DYNAMEX'S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE 13111061.1 INFUSION, LLC’S MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT Ha ic ht Oo 0 NN S N Un RAR W N ee N N N R N N N N N Em e m e m m e e m e e e d e l p m 0 3 O N nn kA W N = D O O N N N N R W = o meritorious cause of action or a meritorious defense. (Morgan v. Superior Court (1959) 172 Cal.App.2d 527, 530.) However, the liberal policy of permitting amendments is not without limitation or qualification. A proposed amendment should be timely made and should not be permitted where it will prejudice the opposing party. (/bid.) Further, a proposed amendment should not be permitted where other factors preclude the proposed amendment or would otherwise render an amendment impermissible. When ruling on a motion to amend, “the trial court must consider various factors, including whether the substitution would prejudice the defendant (e.g. by delaying trial, or increasing discovery burden).” (Demetriades v. Yelp, Inc. (2014) 228 Cal.App.4th 294, 307.) “Although courts are bound to apply a policy of great liberality in permitting amendments to the complaint at any stage of the proceedings, up to and including trial [citations omitted], this policy should be applied only ‘[w]here no prejudice is shown to the adverse party. . "> Magpali v. Farmers Group, Inc. (1996) 48 Cal. App.4™ 471, 486 citing Higgins v. Del Faro (1981) 123 Cal.App.3d 558, 564. “A different result is indicated ‘[w]here inexcusable delay and probable prejudice to the opposing party’ is shown.” Id. citing Estate of Audie Murphy v. Gulf Insurance Company (1978) 82 Cal.App.3d 304, 311. “In Murphy, “... the proposed amendment opened up an entirely new field of inquiry without any satisfactory explanation as to why this major change in point of attack had not been made long before trial.” Ibid. “Under those circumstances, denial of leave to amend was appropriate.” Ibid. “There is a platoon of authority to the effect that a long unexcused delay is sufficient to uphold a trial judge’s decision to deny the opportunity to amend pleadings, particularly where the new amendment would interject a new issue which requires further discovery.” (Green v. Rancho Santa Margarita Mortgage Co. (1994) 28 Cal.App.4th 686, 692.) As set forth above, LifeCare has been in possession of the evidence that purportedly supports its claim for implied in fact contract for a number of years. They have also had knowledge of the identity of Mr. Trinkaus, Mr. Adinolfi and Mr. Dougherty since June of 2017 when Mr. Pople’s deposition was taken. (See Deposition of Rick Pople at 99:9-17; 12 DO1L5-H00000) DYNAMEX'S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE 13111061.1 INFUSION, LLC’S MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT | la ig ht © 0 9 a n s e W N RN O N N N N N N O N ND em e m e m e m = e a e a e e 0 ~ J O N Ww As W N Oo DO N Y Bs WwW ND = O 113:2-21; 135:12-18.) (a true and correct copy of the Pople Depo. is attached as Exhibit “13” to the Arbucci Decl.) There is no excuse for the delay in taking their depositions, and there is no excuse for bringing this motion for leave on the eve of trial while having alleged contract claims based largely on the same evidence in June of 2016 when the original cross-complaint was filed. Furthermore, the testimony LifeCare relies upon does not support the claim for implied in fact contract. Mr. Trinkaus, Mr. Adinolfi and Mr. Dougherty lack the special expertise, skill or knowledge to render relevant opinions on these very complex issues. Moreover, none of these witnesses have a foundation to answer any of LifeCare’s counsel’s argumentative, presumptuous and speculative questions seeking ultimate legal conclusions. Dynamex will incur severe prejudice if the amendment is allowed. The new amendment would interject a completely new legal theory into this case that has not been the subject of any previous discovery by Dynamex. Dynamex will accordingly need an additional 6 months to conduct the necessary discovery on this novel claim in order to determine whether a motion for summary adjudication is necessary. If a motion for summary adjudication is warranted, Dynamex will need an additional continuance long enough to accommodate a timely motion. The continuance will also likely result in significant and additional motion practice, including but not limited to a demurrer, motion to strike and inevitable discovery motions. The first Dynamex learned of the theory was in connection with LifeCare’s requested jury instructions in early July of 2019. This motion was brought over a month after that. That LifeCare has interjected this theory and the Motion after the parties have prepared joint trial documents and submitted joint long cause binders on two separate occasions is severely disruptive, prejudicial and will significantly delay the pending trial in this case. B. The Proposed Amendment May Properly be Denied As It Changes The Liability Sought to be Imposed Against Dynamex The test in determining whether a pleading can be amended is not whether under technical rules of pleading a new cause of action is introduced, but whether an attempt is DO15-0000001 13 DYNAMEX'S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE 13111061.1 INFUSION, LLC’S MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT I la ig ht Oo 0 J NN n n hs W N N N N N N N N N N mm e m e e e d e m ee e e e d pe 0 3 AN nh A W N = O YW N E W NY Y ~= Oo made to state facts that give rise to a wholly distinct and different legal obligation against a defendant, and the power to permit amendment will be denied if a change is made in the liability sought to be enforced against the defendant. (Klopstock v. Superior Court (1941) 17 Cal.2d 13, 20; Daum v. Superior Court (1964) 228 Cal. App.2d 283, 286; See also Applied Equipment Corp. v. Litton Saudi Arabia, Ltd. (1994) 7 Cal.4™ 503, 514 “[c]ontract and tort are different branches of law. Contract laws exist to enforce legally binding agreements between parties; tort law is designed to vindicate social policy.”) The proposed amendment will impose a theory of breach of an implied in fact agreement with entirely novel terms. This is a significant change in the liability sought to be enforced against Dynamex in light of the pending equitable indemnity claims in LifeCare’s Cross-Complaint. Accordingly, the amendment should be denied. C. The Court Should Deny Leave to Amend Because the Proposed Amendment Fails to State a Valid Cause of Action Against Dynamex Despite a policy favoring amendment, the court has discretion to deny leave to amend where a proposed amendment fails to state a valid cause of action or defense. (California Casualty General Ins. Co. v. Sup.Ct. (1985) 173 Cal.App.3d 274, 280-281 (disapproved on other grounds in Kransco v. American Empire Surplus Lines Ins. Co. (2000) 23 Cal.4th 390, 407.) Such denial is “most appropriate” where the pleading is deficient as a matter of law and the defect could not be cured by the proposed amendment. (California Casualty General Ins. Co., supra, 173 Cal.App.3d at 281; Foxborough v. Van Atta (1994) 26 Cal. App.4th 217, 230.) Thus, leave to amend can be properly rejected where proposed amendments are also subject to demurrer. (Yee v. Mobilehome Park Rental Review Bd. (1998) 62 Cal.App.4th 1409, 1429; Aroa Marketing, Inc. v. Hartford Ins. Co. of Midwest (2011) 198 Cal. App.4th 781, 789.) 1. The Implied Contact Claim Fails As a Matter of Law “An implied in fact contract is based on the conduct of the parties. Like an express contract, an implied-in-fact contract requires an ascertained agreement of the parties.” Unilab Corp. v. Los Angeles-IPA (2016) 244 Cal.App.4th 622, 636. (italics added). “As 14 DO15-0000001 DYNAMEX'S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE 13111061.1 INFUSION, LLC’S MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT I la ig ht © 0 0 3 O N wn sr W N N O N N N N N N N ND mm mm e m e m E E e m ee e e e e 0 0 ~~ O N Wn BRA W O N = o O N N R A W NY -~= Oo to the basic elements [of a contract cause of action], there is no difference between an express and implied contract. . . While an implied in fact contract may be inferred from the conduct, situation or mutual relation of the parties, the very heart of this kind of agreement is an intent to promise.” Division of Labor Law Enforcement v. Transpacific Transportation Co., (1977) 69 Cal.App.3d 268, 275; see also Friedman v. Friedman (1993) 20 Cal. App.4th 876, 888. Creation of a valid contract requires mutual assent ordinarily evidenced by offer and acceptance. See generally Civ. Code, §§ 1551, 1565. “In order for acceptance of a proposal to result in the formation of a contract, the proposal must be ‘sufficiently definite, or must call for such definite terms in the acceptance, that the performance promised is reasonably certain.’ [Citation]” Weddington Productions, Inc. v. Flick (1998) 60 Cal. App. 4th 793, 811. “Whether a contract is sufficiently definite to be enforceable is a question of law for the court.” Ladas v. California State Automobile Assn. (1993) 19 Cal. App.4th 761, 770 fn. 2. A binding contract is not formed by preliminary negotiations or by an agreement to enter into future negotiations. Kruse v. Bank of America (1988) 202 Cal. App.3d. 38, 59. “... [Where any of the terms are left for future determination and it is understood that the agreement is not to be deemed complete until they are settled, or where it is understood that the agreement is incomplete until reduced to writing and signed by parties, no contract results until this is done” Louis Lesser Enterprises, Limited v. Roeder, (1962) 209 Cal.App.2d. 401, 405. “Although the majority of cases deal with oral negotiations, the same principle applies to preliminary written discussions, for there is no meeting of the minds of the parties when they are still negotiating terms.” (Id.) (italics added). Here there is no conflict that the evidence LifeCare relies upon to substantiate the terms of the implied in fact contract is the PowerPoint. (Arbucci Decl. § 8, Exh. 7.) The content of the PowerPoint clearly establishes that it is a preliminary negotiation not capable of acceptance, and it pronounces no definite or certain terms. For starters, the first word in the title of the PowerPoint is “Preliminary. . .” (Id.) The PowerPoint simply 15 PO1L3-0000001 --F53AMEX’S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE 13111061.1 INFUSION, LLC’S MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT | la ig ht NO 00 1 O N wn Bs WwW DN 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 23 26 27 28 identifies who Dynamex’ prior customers are, facts regarding the corporate make-up of Dynamex, its locations, objectives such as reduction of operating costs and technology offers and an executive summary (/d.) There is nothing in the PowerPoint that can be construed to be a proposed contractual term that Dynamex is presenting to LifeCare for acceptance. Even more compelling, the last page of the document is entitled “Next Steps,” which includes bullet points stating: “Agree to solution, where to start”; “Agree to vehicle configuration,”; “Present implementation plan”; “Create standard operation procedures. (Id. at p. MAV000265; See also Adinolfi Depo., Exh. 9 at 83:22-85:2; 93:2- 94:8; Sievers Depo., Exh. 12 at 185:8-186:24.) These statements, as well as the testimony of LifeCare’s own expert, establish that this was nothing more than a preliminary negotiation, that there was no meeting of the minds as to anything set forth in the document, and further negotiations were necessary to establish contract terms and create a binding agreement. Any argument that an unformalized agreement exists is similarly unfounded based on the content of the PowerPoint. “Where the writing at issue shows ‘no more than an intent to further reduce the informal writing to a more formal one’ the failure to follow it with a more formal writing does not negate the existence of a prior contract. However, where the writing shows it was not intended to be binding until a formal written contract is executed, there is no contract.” Harris v. Rudin, Richman & Appel (1999) 74 Cal.App.4th 299, 307. “If the respective parties orally agreed upon all of the terms and conditions of a proposed written agreement with the mutual intention that the oral agreement should thereupon become binding, the mere fact that a formal written agreement to the same effect has not yet been signed does not alter the binding validity of the oral agreement.” Banner Entertainment, Inc. v. Superior Court (1998) 62 Cal.App.4th 348, 358 (italics added). These same statements further evidence that no unformalized oral agreement was reached that was only awaiting a later writing. There is no mention of any future necessary writing in the PowerPoint, nor anywhere else in the record in this case. (See Exh. 7.) To the extent that anything in the PowerPoint can be construed as a contract term, DO15-0000001 16 DYNAMEX’S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE 13111061.1 INFUSION, LLC’S MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT I la ig ht OO 0 ~~ O N un Bs WwW N e RN RN O N N O N N N N N = mm e m e d e m p m e m e d pe d 0 NN A N LU bd W N D = O D N ss W N ~~ Oo which it can’t, the very language of the PowerPoint cited above evidences that there was no agreement as to all of the terms. (Sievers Depo., Exh. 12 at 178:3-21.) It is further unclear as to how LifeCare, assuming the PowerPoint was construed as an offer, could 9 6 accept Dynamex’ “objectives” as a term, or how they could even be construed as terms. The statements set forth above evidence further agreements and conduct required to finalize the terms of any future agreement between the parties, thus precluding a finding of an unformalized agreement. The email sent by Dynamex employee Cody Palosaari to LifeCare attaching the PowerPoint in August of 2014 further evidences this was not a recitation of the terms of any agreement. (Arbucci Decl., 9, Exh. 8.) The email states “Next steps, view a load and launch at your facility”; “Oscar and Heather please let me know if you are able to obtain the data files for us to provide a route analysis.” “I’m happy to answer any further questions as we explore this solution.” (Id.; See also Adinolfi Depo., Exh. 9 at 83:22-85:2; 93:2-94:8.) Again, these statements preclude a finding that the PowerPoint was intended to be the final terms of any contractual relationship between Dynamex and LifeCare, or that Dynamex intended to be bound by the content of the PowerPoint. 2. LifeCare Cannot Allege Contract Damages LifeCare is requesting an amendment to conform to proof but has no evidence of damage. “To prevail on a cause of action for breach of contract, the plaintiff must prove (1) the contract, (2) the plaintiff's performance of the contract or excuse for non- performance, (3) the defendant’s breach, and (4) the resulting damage to plaintiff.” Richman v. Hartley (2014) 224 Cal.App.4th 1182, 1186. “Implicit in the element of damage is that the defendant’s breach caused the plaintiff's damage.” Troyk v. Farmers Group, Inc. (2009) 171 Cal. App. 4th 1305, 1352. LifeCare must plead facts sufficient to establish every element of the cause of action. Cantu v. Resolution Trust Corp. (1992) 4 Cal.App.4th 857, 879-880 (italics in original). If the defendant [Dynamex] negates any essential element of a particular cause of action, the court should sustain a demurrer to that cause of action. (/d.) DO15-0000001 17 DYNAMEX'S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE 13111061.1 INFUSION, LLC'S MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT \ la ig ht O© 0 0 I O N wn HH WwW N = N N N N N N N N N m e m e m e m pe e m d e m e d ee 0 0 J O N WL B R A W N = O D ” N N W N = Oo On August 23, 2019, LifeCare provided verified responses to Dynamex’s Request for Admission, Set Two. (Arbucci Decl. 911-12, Exhs. 10-11.) Responses to requests 9 and 10 state that *. . . the information known or readily obtainable is insufficient to enable responding party to admit or deny. . .” whether they have, or have not incurred monetary damages. (Id.) Per the Court’s order, fact discovery is closed in this case. By LifeCare’s own admission, no evidence exists to support a critical element to LifeCare’s requested cause of action. Accordingly, LifeCare cannot allege contract damages. 3. The DTSA Was Terminated and Cannot Form the Basis of an Implied in Fact Contract “A contract remains in force until it has been terminated either according to its terms or through the acts of the parties evidencing an abandonment.” Busch v. Globe Industries, (1962) 200 Cal. App. 2d 315, 320 (Citation omitted). Once an option to terminate a contract is exercised, the contract is extinguished and discharged; it cannot thereafter be revived by the other party through an offer to perform the act, the nonperformance of which gave rise to the option to terminate. Siegel v. Lewis (1946) 74 Cal. App.2d 86, 91 citing Altman v. Bautzer, (1942) 54 Cal. App.2d 543, 548. Here, LifeCare’s proposed amendment based on the DTSA runs directly afoul of established contract law. By LifeCare’s own admission, the DTSA was terminated. (See Motion at 3:3-5.) They now ask that this court seek to impose the very terms of the DTSA which ultimately gave rise to the option to terminate it. As a matter of law, the DTSA cannot be revived to impose upon Dynamex contractual terms that have previously been terminated. 18 DE15-000000] DYNAMEX'S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE 131110611 INFUSION, LLC’S MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT I la ig ht © 60 39 & Un BH WwW NN = N N N N N N N O N N m mm p m e m e m em e m p e ee d 0 NN AN Wn A W N = O 0 0 N N N NN R W = o IV. CONCLUSION For the foregoing reasons, Dynamex respectfully requests that LifeCare’s Motion for Leave to File a First Amended Cross-Complaint be denied. Dated: September 11, 2019 HAIGHT BROWN & BONESTEEL LLP DO15-0000001 13111061.1 Petr Dubrawski . John Arbucci Jessica A. Detering Attorneys for Cross-Complainants, DYNAMEX, INC. and DYNAMEX OPERATIONS WEST, LLC 19 DYNAMEX’S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE INFUSION, LLC'S MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT Ha io ht © 0 3 O N Wn b w N e - Oo 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 LOS ANGELES Melissa Sierra, etc. v. Alceda Express, LLC, et al. LASC Case No. MC026264, North District At the time of service, | was over 18 years of age and not a party to this action. 1 am employed in the County of Los Angeles, State of California. My business address is 555 South Flower Street, Forty-Fifth Floor, Los Angeles, CA 90071. On September 11, 2019, I served true copies of the following document(s) described as DYNAMEX, INC. AND DYNAMEX OPERATIONS WEST, LLC’S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE INFUSION, LLC’S MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT on the interested parties in this action as follows: SEE ATTACHED SERVICE LIST BY ELECTRONIC SERVICE: I served the document(s) on the person listed in the Service List by submitting an electronic version of the document(s) to One Legal, LLC, through the user interface at www.onelegal.com. BY OVERNIGHT DELIVERY: I enclosed said document(s) in an envelope or package provided by the overnight service carrier and addressed to the persons at the addresses listed in the Service List. I placed the envelope or package for collection and overnight delivery at an office or a regularly utilized drop box of the overnight service carrier or delivered such document(s) to a courier or driver authorized by the overnight service carrier to receive documents. I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct. Executed on September 11, 2019, at Los Angeles, California. . Mentesana DO15-0000001 20 DYNAMEX'S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE 13111061.1 INFUSION, LLC’S MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT | la ig ht OO 00 3 O N Un Br WwW N = N N N N N N N N N mm ee e m pe e e m em e d e d ed 0 J NN Wn RA W N = O O N P E W N = OO SERVICE LIST Melissa Sierra, etc. v. Alceda Express, LLC, et al. LASC Case No. MC026264, North District Mark E. Lowary Brian Gravdal BERMAN BERMAN BERMAN SCHNEIDER & LOWARY 3890 Tenth Street Riverside, CA 92501 Tel: 951.682.8300 Fax: 951.682.8331 Email: melowary@b3law.com briangravdal@gmail.com Associate Attorneys for Defendants, Cross- Complainants and Cross-Defendants, Maverick Healthcare Holdings II, Inc.. Lifecare Solutions, Inc. and Preferred Homecare Infusion. Inc. Robert Lee Reisinger FORD WALKER HAGGERTY & BEHAR 1 World Trade Center, 27th Floor Long Beach, CA 90831 Phone: 562.983.2579 Fax: 562.590.3597 Email: bob@fwhb.com Attorneys for Alceda Express, LLC, Alberto Alceda, and Alberto Alceda Jr. - James J. Yukevich Patrick Cimmarusti Joseph McCormack YUKEVICH | CAVANAUGH 355 S. Grand Avenue, 15th Floor Los Angeles, CA 90071-1560 Phone: 213.362.7777 Fax: 213.362.7788 Email: jyukevich@yukelaw.com pcimmarusti@yukelaw.com Jmccormack@yukelaw.com Associate Attorneys for Defendants, Cross- Complainants and Cross-Defendants, Maverick Healthcare Holdings, II, Lifecare Solutions, Inc. and Preferred Homecare Infusion. Inc. DO15-0000001 DYNAMEX’S OPPOSITION TO LIFECARE SOLUTIONS, INC. AND PREFERRED HOMECARE 13111061.1 INFUSION, LLC’S MOTION FOR LEAVE TO FILE A FIRST AMENDED CROSS-COMPLAINT
