No Value: Jane Doe vs BIG BROTHERS BIG SISTERS OF AMERICA, a California corporation, et al.

On March 12, 2021 a No Value was filed involving a dispute between Jane Be Doe, and Big Brothers Big Sisters Of America, A California Corporation, Big Brothers Big Sisters Of Monterey County, A California Corporation, Big Brothers Big Sisters Of Salina, A California Corporation, Boys & Girls Clubs Of Monterey County, A California Corporation, Jon David Woody, for Other PI/PD/WD Unlimited (23) in the District Court of Monterey County.

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1 PAUL CALEO (SBN 153925)
pcaleo@grsm.com
2 MARK HEISEY (SBN 300141)
mheisey@grsm.com
3 GORDON REES SCULLY MANSUKHANI, LLP
1111 Broadway, Suite 1700
4 Oakland, CA 94607
Telephone: (510) 463-8600
5 Facsimile: (510) 984-1721

6 Attorneys for Defendant
BOYS & GIRLS CLUBS OF MONTEREY COUNTY
7

8 SUPERIOR COURT OF THE STATE OF CALIFORNIA

9 IN AND FOR THE COUNTY OF MONTEREY
10

11
Gordon Rees Scully Mansukhani, LLP

JANE BE DOE, and individual; Case No.: 21CV000805
12
1111 Broadway, Suite 1700

Plaintiff,
DEFENDANT BOYS & GIRLS CLUBS OF
Oakland, CA 94607

13
v. MONTEREY COUNTY’S
14 MEMORANDUM OF POINTS AND
BIG BROTHERS BIG SISTERS OF AUTHORITIES IN SUPPORT OF
15 AMERICA, a California Corporation; BIG SUMMARY JUDGMENT
BROTHERS BIG SISTERS OF MONTEREY
16 COUNTY, a California Corporation; BOYS &
GIRLS CLUB OF MONTEREY COUNTY, a Date: August 4, 2023
17 California Corporation; JON DAVID Time: 8:30 a.m.
WOODY, an individual; and DOES 1 to 50; Dept.: 15
18
Defendants.
19
20

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27

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DEFENDANT BOYS & GIRLS CLUBS OF MONTEREY COUNTY’S MEMORANDUM OF POINTS
AND AUTHORITIES IN SUPPORT OF SUMMARY JUDGMENT
1 TABLE OF CONTENTS
2 I. INTRODUCTION................................................................................................................ 6
3
II. FACTS .................................................................................................................................. 7
4
III. LEGAL ARGUMENT ..................................................................................................... 9
5
A. B&GC HAS MET ITS BURDEN AND THE COURT CAN GRANT SUMMARY JUDGMENT .......... 9
6

7 B. PLAINTIFF CANNOT ESTABLISH BY ADMISSIBLE EVIDENCE THAT B&GC IS LIABLE UNDER
A THEORY OF SUCCESSOR LIABILITY” ...................................................................................... 10
8
1. The Undisputed Facts Establish that B&GC Did Not Merge or Acquire BBBSMC ... 10
9
2. Even If B&GC could be Considered a “Purchaser” of BBBSMC, the Undisputed Facts
10
Establish that the Exception to the General Rule that a Purchaser Does Not Assume the
11 Seller’s Liabilities Does Not Apply ...................................................................................... 13
Gordon Rees Scully Mansukhani, LLP

12 a. The Undisputed Facts Establish that Plaintiff Cannot Support an Express or Implied
1111 Broadway, Suite 1700

Assumption of the Plaintiff’s Claim by B&GC. .............................................................. 13
Oakland, CA 94607

13
b. The Undisputed Facts Establish that the Transaction Did Not Amount to a
14
Consolidation or Merger of the Two Non-Profit Public Benefit Corporations. .............. 15
15
c. B&GC is not a mere continuation of BBBSMC. ..................................................... 16
16
d. The Undisputed Facts Establish that the Transfer of $17,662.00 in Office Equipment
17 Was Not Done for the Fraudulent Purpose of Escaping Liability of BBBSMC’s Debts. 18
18
C. PLAINTIFF CANNOT ESTABLISH THAT BBBSA, BBBSMC, OR DEFENDANT WOODY WERE
19 AGENTS, REPRESENTATIVES, OR EMPLOYEES OF B&GC AT THE TIME PLAINTIFF ALLEGES SHE
WAS ABUSED BY DEFENDANT WOODY. ..................................................................................... 19
20
D. PLAINTIFF CANNOT ESTABLISH FACTS TO SUPPORT THAT THE ALTER EGO DOCTRINE
21 SHOULD BE UTILIZED TO DISREGARD B&GC’S CORPORATE ENTITY. ......................................... 19

22
E. THE UNDISPUTED FACTS ESTABLISH THAT B&GC HAS NO DIRECT LIABILITY FOR ANY
23 CAUSE OF ACTION ALLEGED AS IT OWED NO DUTY TO PLAINTIFF AS PLAINTIFF DID NOT
PARTICIPATE IN B&GC PROGRAMS NOR DID B&GC HAVE ANY RELATIONSHIP WITH DEFENDANT
24 WOODY..................................................................................................................................... 20
25 1. Intentional Infliction of Emotional Distress ................................................................ 21
26
2. Negligence.................................................................................................................... 21
27
3. Breach of Fiduciary Duty ............................................................................................ 22
28

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DEFENDANT BOYS & GIRLS CLUBS OF MONTEREY COUNTY’S MEMORANDUM OF POINTS
AND AUTHORITIES IN SUPPORT OF SUMMARY JUDGMENT
1 4. Constructive Fraud ...................................................................................................... 23
2 5. Sexual Harassment....................................................................................................... 23
3
IV. CONCLUSION .............................................................................................................. 24
4

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10

11
Gordon Rees Scully Mansukhani, LLP

12
1111 Broadway, Suite 1700
Oakland, CA 94607

19
20

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DEFENDANT BOYS & GIRLS CLUBS OF MONTEREY COUNTY’S MEMORANDUM OF POINTS
AND AUTHORITIES IN SUPPORT OF SUMMARY JUDGMENT
1 TABLE OF AUTHORITIES
2 CASES
3
Aguilar v. Atlantic Richfield Co.
4 (2001) 25 Cal.4th 826 ---------------------------------------------------------------------------------------- 9

5 Barrett v. Bank of America
(1986) 183 Cal.App.3d 1362 ------------------------------------------------------------------------------- 23
6
Catholic Healthcare West v. California Ins. Guarantee Assn.
7 (2009) 178 Cal.App.4th 15 --------------------------------------------------------------------------------- 15

8 CenterPoint Energy, Inc. v. Superior Court
(2007) 157 Cal.App.4th 1101 ------------------------------------------------------------------------- 13, 17
9
City of Atascadero v. Merrill Lynch, Pierce, Fenner & Smith, Inc.
10 (1998) 68 Cal.App.4th 445 --------------------------------------------------------------------------------- 23

11 Davidson v. City of Westminster
Gordon Rees Scully Mansukhani, LLP

(1982) 32 Cal.3d 197 ---------------------------------------------------------------------------------------- 21
12
1111 Broadway, Suite 1700

J.L. v. Children's Institute, Inc.
(2009) 177 Cal.App.4th 388 -------------------------------------------------------------------------------- 21
Oakland, CA 94607

14 JPV I L.P. v. Koetting
(2023) 88 Cal.App.5th 172 --------------------------------------------------------------------------------- 20
15
Kelley v. The Conco Companies
16 (2011) 196 Cal.App.4th 191 -------------------------------------------------------------------------------- 24

17 Kohn v. Kohn
(1950) 95 Cal.App.2d 708 ---------------------------------------------------------------------------------- 20
18
Markley v. Beagle
19 (1967) 66 Cal.2d 951,---------------------------------------------------------------------------------------- 24

20 Michael H. v. Gerald D.
(1987) 191 Cal.App.3d 995 ---------------------------------------------------------------------------------- 9
21
Oasis West Realty, LLC v. Goldman
22 (2011) 51 Cal.4th 811 --------------------------------------------------------------------------------------- 22

23 Penasquitos, Inc. v. Superior Court
(1991) 53 Cal.3d 1180 ---------------------------------------------------------------------------------- 14, 18
24
Phillips, Spallas & Angstadt, LLP v. Fotouhi
25 (2011) 197 Cal.App.4th 1132 ------------------------------------------------------------------------------ 17

26 Ray v. Alad Corp.
(1977) 19 Cal.3d 22, 28 ----------------------------------------------------------------------- 13, 14, 15, 17
27

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DEFENDANT BOYS & GIRLS CLUBS OF MONTEREY COUNTY’S MEMORANDUM OF POINTS
AND AUTHORITIES IN SUPPORT OF SUMMARY JUDGMENT
1 STATUTES

2 California Code of Civil Procedure § 1714. ------------------------------------------------------------ 21
3 California Code of Civil Procedure § 437c -------------------------------------------------------------- 9
4 California Corporations Code § 1905 ---------------------------------------------------------------- 15, 18
5 California Corporations Code § 2004 --------------------------------------------------------------------- 18
6 California Corporations Code § 5110 --------------------------------------------------------------------- 10
7 California Corporations Code § 5410 --------------------------------------------------------------------- 20
8 California Corporations Code § 5911 --------------------------------------------------------------------- 12
9 California Corporations Code § 6010 ---------------------------------------------------------------- 10, 11
10 California Corporations Code § 6011 --------------------------------------------------------------------- 11
11
Gordon Rees Scully Mansukhani, LLP

California Corporations Code § 6014 --------------------------------------------------------------------- 11
12
1111 Broadway, Suite 1700

California Corporations Code § 6716 ------------------------------------------------------- 10, 12, 16, 18
Oakland, CA 94607

13 Internal Revenue Code § 501 --------------------------------------------------------------------------- 8, 12
14 Nonprofit Public Benefit Corporation Corp. Code, § 6011 -------------------------------------------- 10
15 Penal Code § 11165 ------------------------------------------------------------------------------------------ 22
16

19
20

26
27

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DEFENDANT BOYS & GIRLS CLUBS OF MONTEREY COUNTY’S MEMORANDUM OF POINTS
AND AUTHORITIES IN SUPPORT OF SUMMARY JUDGMENT
1 I. INTRODUCTION

2 Defendant Boys and Girls Clubs of Monterey County (hereinafter “B&GC”) hereby

3 moves for summary judgment against the clams made by Plaintiff Jane Be Doe (hereinafter

4 “Plaintiff”). Plaintiff alleges she was sexually abused as a minor participant with another

5 organization, Big Brothers Big Sisters of Monterey County (Hereinafter “BBBSMC”), by

6 Defendant Jon David Woody (hereinafter “Woody”). Plaintiff alleges that Woody was formerly

7 a volunteer and mentor with BBBSMC, and alternatively with BBBSMC’s national organization

8 Big Brothers Big Sisters of America (hereinafter “BBBSA”), from 1972-2002. Plaintiff alleges

9 that she was subjected to the sexual assault by Woody by virtue of her participation in
10 BBBSMC.

11 Though Plaintiff generally alleges that B&GC was the agent, representative, employee,
Gordon Rees Scully Mansukhani, LLP

12 alter ego, and/or successor in interest of all other defendants, including BBBSMC and Woody,
1111 Broadway, Suite 1700
Oakland, CA 94607

13 Plaintiff cannot show that a triable issue of fact exists to support any of these conclusory

14 allegations. Plaintiff was never a member of B&GC or a participant in B&GC’s programs.

15 Defendant Woody never held a position of any kind within B&GC. In fact, Plaintiff can show

16 no connection whatsoever between B&GC on the one hand, and either BBBSMC, BBBSA, or

17 Defendant Woody on the other, at the time Plaintiff alleges she was assaulted by Woody.

18 Plaintiff’s entire case against B&GC stems from an illusory argument that B&GC merged

19 with BBBSMC in 2010, and is therefore liable for Woody’s actions in 2000-2002 when he was a
20 volunteer mentor at BBBSMC. However, the undisputed facts demonstrate that no merger

21 occurred between B&GC and BBBSMC. In fact, a merger between the two corporations was

22 rejected by B&GC’s Board.

23 Instead, BBBSMC underwent a voluntary dissolution in 2011 and proceeded to wind up

24 the corporation. Known assets of BBBSMC, consisting of used office furniture and supplies

25 generously valued at around $17,662.00, were distributed to B&GC pursuant to the requirements

26 of BBBSMC’s Articles of Incorporation and a written waiver of the distribution of these assets
27 was obtained by the Attorney General. Three former Board Members of the defunct corporation

28 BBBSMC joined the Board of B&GC, with two of the three resigning within months. Several

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DEFENDANT BOYS & GIRLS CLUBS OF MONTEREY COUNTY’S MEMORANDUM OF POINTS
AND AUTHORITIES IN SUPPORT OF SUMMARY JUDGMENT
1 former employees of BBBSMC were invited to apply for open positions at B&GC, with perhaps

2 as many as three former BBBSMC employees being offered jobs at B&GC. Formers mentors

3 and mentees of BBBSMC were invited to become members of B&GC and continue their

4 relationships in a newly created B&GC program, but few if any participated.

5 As a nonprofit public benefit corporation, none of these actions were taken for the

6 possibility of higher profit or distributions to B&GC members, as B&GC was and is dedicated to

7 charitable purposes and prohibited by law from making distributions to members. Instead, these

8 actions were taken to try to fill the void of nonprofit services that were lost to the community by

9 BBBSMC’s dissolution and winding up of the corporation. While the past abuse suffered by
10 Plaintiff at the hands of Woody is tragic, the undisputed facts do not support any legal basis for

11 Plaintiff to charge B&GC with Woody’s misdeeds, and summary judgment in favor of B&GC is
Gordon Rees Scully Mansukhani, LLP

12 appropriate.
1111 Broadway, Suite 1700
Oakland, CA 94607

13 II. FACTS

14 From in or around 2000 through 2002, Plaintiff was a minor participant with BBBSA

15 and/or BBBSMC. [Undisputed Material Fact (“UMF”) no. 1] Defendant Woody was a

16 volunteer and mentor with BBBSA, BBBSMC, and DOES 2 through 50, between in or around

17 1972 through in or around 2002. [UMF no 2]. It is through Plaintiff’s participation in BBBSA

18 and/or BBBSMC’s mentoring program, that she was placed in contact with Defendant Woody.

19 [UMF no. 3]. During this period from around 2000 through 2002, Plaintiff alleges she was
20 repeatedly sexually abused by Woody. [UMF no. 4]. Plaintiff was not a minor participant in any

21 B&GC program in 2000 through 2002. [UMF no. 5]. Woody has not held any position, whether

22 volunteer or paid, within B&GC at any time. [UMF no. 6].

23 B&GC was initially formed in 1968 as a California Non-Profit Public Benefit

24 Corporation with the California Secretary of State.1 [UMF no. 7]. From 1968 to 2009, B&GC

25 had no relationship with BBBSMC or BBBSA. [UMF no. 8]. On March 25, 2009, B&GC and

26 BBBSMC signed a Memorandum of Understanding concerning a partnership between the two
27

28 1
The organization became “Boys & Girls Clubs of Monterey County” following amendment of its Articles of
Incorporation filed on April 5, 2000.
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DEFENDANT BOYS & GIRLS CLUBS OF MONTEREY COUNTY’S MEMORANDUM OF POINTS
AND AUTHORITIES IN SUPPORT OF SUMMARY JUDGMENT
1 organizations to run a “High School Bigs Program” at B&GC facilities during the summer of

2 2009. [UMF no. 9].

3 As early as March 2009, B&GC became aware that BBBSMC was experiencing financial

4 hardship, and was considering dissolving. [UMF no. 10]. B&GC discussed merging with

5 BBBSMC, but the B&GC Board approved a motion on February 23, 2010, not to move forward

6 with a merger of the organizations. [UMF no. 11]. At a Board Meeting on September 16, 2010,

7 B&GC’s Board approved a motion to “absorb” BBBSMC. [UMF no. 12]. Following the

8 September 16, 2010 meeting, no agreement was executed to merge with, acquire, or purchase

9 BBBSMC. [UMF no. 13].
10 On February 17, 2011, BBBSMC filed a Domestic Nonprofit Corporation Certificate of

11 Dissolution (“Certificate of Dissolution”) with the California Secretary of State. [UMF no. 14].
Gordon Rees Scully Mansukhani, LLP

12 BBBSMC’s Certificate of Dissolution stated that the corporation’s known debts and liabilities
1111 Broadway, Suite 1700
Oakland, CA 94607

13 had been adequately provided for by their assumption by B&GC. [UMF no. 15]. B&GC never

14 entered into an agreement to assume any debts or liabilities of BBBSMC. [UMF no. 16].

15 BBBSMC’s Certificate of Dissolution further stated that its known assets had been distributed to

16 the persons entitled thereto. [UMF no. 17].

17 BBBSMC’s Articles of Incorporation required that upon the dissolution or winding up of

18 the corporation, its assets remaining after payment of, or provision for payment of, all debts and

19 liabilities of the corporation, be distributed to a nonprofit fund, foundation, or corporation which
20 is organized and operated exclusively for charitable purposes and which as established its tax-

21 exempt status under Section 501(c)(3) of the Internal Revenue Code. [UMF no. 18]. BBBSMC

22 obtained a waiver from the Attorney General’s Office to dispose of its assets upon dissolution to

23 B&GC. [UMF no. 19].

24 Following the dissolution of BBBSMC, former BBBSMC Board Members Phil Wilhelm,

25 Patsy Schulte and Peter Baird joined the Board of B&GC. [UMF no. 20]. Phil Wilhelm and

26 Pasty Schulte resigned from B&GC shortly thereafter. [UMF no. 21]. As many as three former
27 employees of BBBSMC applied for and were hired for positions at B&GC. [UMF no. 22].

28 B&GC took steps to create a mentor/mentee program at B&GC facilities that former matches of

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DEFENDANT BOYS & GIRLS CLUBS OF MONTEREY COUNTY’S MEMORANDUM OF POINTS
AND AUTHORITIES IN SUPPORT OF SUMMARY JUDGMENT
1 BBBSMC could utilize to continue their relationships. [UMF no. 23]. BBBSMC mentors or

2 mentees applied to participate in the new B&GC program. [UMF no. 24].

3 III. LEGAL ARGUMENT

4 A. B&GC has met its Burden and The Court Can Grant Summary Judgment

5 A motion for summary judgment shall be granted if the moving party establishes “that

6 there is no triable issue as to any material fact and that the moving party is entitled to judgment

7 as a matter of law.” (Code Civ. Proc. § 437c subd. (c).) “There is a triable issue of material fact

8 if, and only if, the evidence would allow a reasonable trier of fact to find the underlying fact in

9 favor of the party opposing the motion in accordance with the applicable standard of proof.”
10 (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850.) In determining this, “the court

11 shall consider all of the evidence set forth in the papers . . . and all inferences reasonably
Gordon Rees Scully Mansukhani, LLP

12 deductible from the evidence. (Id.) Further, the court may rely on “affidavits, declarations,
1111 Broadway, Suite 1700
Oakland, CA 94607

13 admissions, answers to interrogatories, depositions and matters of which judicial notice shall or

14 may be taken.” (Code Civ. Proc. §437c subd. (b).)

15 California law provides that a defendant has met its burden of establishing that a cause of

16 action is without merit if the defendant has shown that one or more elements of the cause of

17 action cannot be established, or that there is a complete defense to that cause of action. (Code

18 Civ. Proc. § 437c subd. (p)(2).) The defendant’s meeting of this obligation then shifts the burden

19 to the plaintiff, who must set forth specific facts showing that a triable issue of material facts
20 exists, and may not merely rely upon the allegations set forth in the pleadings. (Id. See also,

21 Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 849.) One of the purposes of the

22 summary judgment motion is to expedite litigation by avoiding frivolous claims and unnecessary

23 trials. (Michael H. v. Gerald D. (1987) 191 Cal.App.3d 995.)

24 Here, Plaintiff cannot support her conclusory allegations to support essential elements of

25 her claims for intentional infliction of emotional distress, negligence, breach of fiduciary duty,

26 constructive fraud, or sexual harassment against B&GC. Plaintiff further cannot support any of
27 her conclusory allegations that B&GC is vicariously liable for the acts or omissions of

28 Defendants BBBSA, BBBSMC, or Woody. Plaintiff further cannot create a triable issue that

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DEFENDANT BOYS & GIRLS CLUBS OF MONTEREY COUNTY’S MEMORANDUM OF POINTS
AND AUTHORITIES IN SUPPORT OF SUMMARY JUDGMENT
1 B&GC is the alter ego, or the successor in interest of Defendants BBBSMC, BBBSA, or

2 Defendant Woody. Accordingly, summary judgment in favor of B&GC and against Plaintiff is

3 appropriate.

4 B. Plaintiff Cannot Establish by Admissible Evidence that B&GC is Liable
under a Theory of Successor Liability”
5

6 The undisputed facts conclusively demonstrate that in 2011, BBBSMC elected to wind
7 up and dissolve the corporation and that BBBSMC was not purchased or acquired by, nor did it
8 merge with, B&GC. While the possibility of a legal merger was discussed, the B&GC voted not
9 to move forward with a merger. [UMF no. 11]. Accordingly, none of the necessary steps
10 pursuant to Corporations Code Sections 6010, et seq. were taken to effectuate a merger between
11 the corporations. The undisputed facts further show no purchase agreement was ever created, let
Gordon Rees Scully Mansukhani, LLP

12 alone approved by the two corporation’s Boards.
1111 Broadway, Suite 1700
Oakland, CA 94607

13 Instead, the undisputed facts show that BBBSMC’s distribution of its office furniture and
14 equipment to B&GC upon dissolution was undertaken to comply Corp. Code, § 6716, which
15 requires a nonprofit public benefit corporation like BBBSMC to distribute its remaining assets
16 upon dissolution and winding up in accordance with its Articles of Incorporation. Finally, even
17 if this Court could find that a triable issue existed as to whether B&GC “purchased” BBBSMC,
18 the doctrine of successor liability does not support that B&GC assumed responsibility for
19 Plaintiff’s instant lawsuit, which was not a known debt or liability at the time any “purchase” of
20 BBBSMC could be alleged to have occurred.
21 1. The Undisputed Facts Establish that B&GC Did Not Merge or
Acquire BBBSMC
22

23 B&GC and BBBSMC were formed as Nonprofit Public Benefit Corporations under
24 California Law, and are therefore governed by Corporations Code sections 5110, et seq. [See
25 UMF no. 7; see also UMF no. 18, Request for Judicial Notice (“RJN”), Exhibits “E” and “F”
26 thereto]. Corporations Code Sections 6010, et seq., govern the requirements of a merger
27 involving a Nonprofit Public Benefit Corporation. Corp. Code, § 6011 states in relevant part:
28

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DEFENDANT BOYS & GIRLS CLUBS OF MONTEREY COUNTY’S MEMORANDUM OF POINTS
AND AUTHORITIES IN SUPPORT OF SUMMARY JUDGMENT
1 The board of each corporation which desires to merge shall approve an agreement
of merger. The constituent corporations shall be parties to the agreement of
2 merger and other persons may be parties to the agreement of merger.
3 Corp. Code, § 6011. Corp. Code, § 6011, subsection (a) through (f) further set requirements for
4 the terms that must be included in the merger agreement, including the terms and conditions of
5 the merger. Corp. Code, § 6011(a)-(f). Furthermore, the members of each constituent
6 corporation must approve the principal terms of a merger and the chairperson, vice president or
7 president, and secretary of each organization must sign the agreement. Id. at 6012. The
8 surviving corporation must then file a copy of the agreement of merger with an officers’
9 certificate of each corporation providing certain required information. Id. at 6014.
10 In the present case, there is no triable issue of fact that the requirements of Corporations
11 Code Sections 6010, et seq. are not met to effectuate a legal merger between BBBSMC and
Gordon Rees Scully Mansukhani, LLP

12 B&GC. Most importantly, there is no evidence to suggest that the Boards of either BBBSMC or
1111 Broadway, Suite 1700
Oakland, CA 94607

13 B&GC approved an agreement of merger. While the possibility of a merger between the
14 corporations was considered by B&GC’s Board, it was expressly rejected at its February 23,
15 2010 Board Meeting. [UMF no. 11[. As a result of neither Board agreeing to merge the two
16 corporations, no Agreement of Merger was ever drafted, nor was any agreement signed by the
17 requisite members of either corporation. B&GC did not file a copy of any agreement of merger
18 with the Secretary of State as would have been required of the surviving corporation. See Corp.
19 Code, §§ 6011-6014. Notably, B&GC had merged with another Nonprofit Public Benefit
20 Corporation, the Davis Love Family Scholarship Foundation, four years earlier in 2006,
21 demonstrating that B&GC was aware of the formal requirements of a merger. [See Declaration
22 of Donna Ferraro (“Ferraro Decl.”), Pg. 3 ⁋7, Exhibit “C” thereto].
23 The undisputed facts further demonstrate that BBBSMC underwent a voluntary
24 dissolution pursuant to Corporations Code §§ 6610, et seq. On October 21, 2010, the Board of
25 BBBSMC held a special meeting to consider the winding up and dissolution of the Corporation.
26 The BBBSMC Board unanimously adopted several resolutions at the October 21, 2010 special
27 meeting. First, the Board adopted a resolution that it was in the best interests of the corporation
28 to be wound up and dissolved. Second, the Board adopted a resolution to execute any and all
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DEFENDANT BOYS & GIRLS CLUBS OF MONTEREY COUNTY’S MEMORANDUM OF POINTS
AND AUTHORITIES IN SUPPORT OF SUMMARY JUDGMENT
1
instruments as may be necessary or reasonable to complete the dissolution and to wind up the
2
Corporation’s affairs. Finally, the Board adopted a resolution to distribute 100% of the wholly
3
owned assets of BBBSMC, upon consent of the Attorney General, to B&GC.
4
The minutes of the Special Meeting of BBBSMC make no representation that this
5
distribution was intended as a “sale” of BBBSMC’s assets, and consequently no contract for the
6
“sale” of BBBSMC’s principal assets to B&GC for consideration exists. Instead, the
7
BBBSMC’s Board’s decision to distribute its assets to B&GC is consistent with BBBSMC’s
8
obligations to wind up the corporations affairs upon dissolution in accordance with Corp. Code,
9
§ 6716, which requires a non-profit public benefit corporation to dispose of its assets upon
10
dissolution and winding up in a manner consistent with its Articles of Incorporation.
11
Gordon Rees Scully Mansukhani, LLP

BBBSMC’s Articles of Incorporation required that upon the dissolution or winding up of the
12
1111 Broadway, Suite 1700

corporation, its assets remaining after payment of, or provision for payment of, all debts and
Oakland, CA 94607

13
liabilities of the corporation, be distributed to a nonprofit fund, foundation, or corporation which
14
is organized and operated exclusively for charitable purposes and which as established its tax-
15
exempt status under Section 501(c)(3) of the Internal Revenue Code. B&GC, as a nonprofit
16
public benefit corporation, was an entity meeting the requirements for receiving distribution of
17
BBBSMC’s assets upon dissolution or winding up of BBBSMC. [UMF no. 18]. BBBSMC
18
further properly applied for, and obtained, written waiver from the Attorney General to distribute
19
its assets to B&GC. [UMF no. 19]. No “sale” agreement signed by both Boards exists, and no
20
consideration was exchanged for the known assets of BBBSMC. [See Corp. Code, § 5911].
21
Pursuant to the undisputed facts, Plaintiff cannot create a triable issue of fact to support
22
that B&GC purchased, acquired, or merged with BBBSMC. While Plaintiff is likely to argue
23
that a triable issue exists because the Boards of each organization used the terms “absorb”,
24
“merger”, etc. when describing the relationship between BBBSMC and B&GC around the time
25
BBBSMC dissolved and wound up its corporate affairs, these lay statements do not have any
26
effect on the proscribed legal procedure by which BBBSMC elected to end its corporate
27
existence.
28

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DEFENDANT BOYS & GIRLS CLUBS OF MONTEREY COUNTY’S MEMORANDUM OF POINTS
AND AUTHORITIES IN SUPPORT OF SUMMARY JUDGMENT
1 2. Even If B&GC could be Considered a “Purchaser” of BBBSMC, the
Undisputed Facts Establish that the Exception to the General Rule
2 that a Purchaser Does Not Assume the Seller’s Liabilities Does Not
3 Apply

4 The general rule of successor liability for the purchaser of a corporation’s principal assets
5 holds that the purchaser of the principal assets of another corporation does not assume the seller's
6 liabilities unless (1) there is an express or implied agreement of assumption, (2) the transaction
7 amounts to a consolidation or merger of the two corporations, (3) the purchasing corporation is a
8 mere continuation of the seller, or (4) the transfer of assets to the purchaser is for the fraudulent
9 purpose of escaping liability for the seller's debts. Ray v. Alad Corp. (1977) 19 Cal.3d 22, 28. It
10 is appropriate for the court to examine successor liability issues on their own unique facts.
11
Gordon Rees Scully Mansukhani, LLP

CenterPoint Energy, Inc. v. Superior Court (2007) 157 Cal.App.4th 1101, 1122. In the present
12 case, Plaintiff cannot create a triable issue of fact to support that any of these exceptions apply in
1111 Broadway, Suite 1700
Oakland, CA 94607

13 the present case.
14
a. The Undispute

Case Info

Case No.

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Document Filed Date

May 17, 2023

Case Filing Date

March 12, 2021

County

Parties

Alison McNaboe Crane Attorney for the Defendant
Ashley Taylor Rayfield Attorney for the Plaintiff
BIG BROTHERS BIG SISTERS OF AMERICA, a California corporation Defendant
Big Brothers Big SIsters of Monterey County, a California Corporation Defendant
BIG BROTHERS BIG SISTERS OF SALINA, a California corporation Defendant
Boys & Girls Clubs of Monterey County, a California Corporation Defendant
Courtney Meghan Thom Attorney for the Plaintiff
Courtney Pauline Pendry Attorney for the Plaintiff
Jane BE Doe Plaintiff
John Clinton Manly Attorney for the Plaintiff
Jon David Woody Defendant
Mark Heisy Attorney for the Defendant
Michael Anthony Kruppe Attorney for the Defendant
Morgan Alan Stewart Attorney for the Plaintiff
Paul Damien Caleo Attorney for the Defendant
Tara A Murray Attorney for the Defendant
Vince Finaldi Attorneys for Plaintiffs
Gary Moore Attorney
Maya Miller Attorney
John Mackay Attorneys for Plaintiffs
Jane Reilley Attorney
Haley Aanestad Attorney
Michael Kaufman Attorneys for Defendants
Omair Khan Attorney
Joy Smith Attorney
Chad Thomas Attorneys for Defendants
Gary Brown Attorney

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No Value: Jane Doe vs BIG BROTHERS BIG SISTERS OF AMERICA, a California corporation, et al.

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