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Wendy M. Thomas (SBN 268695)
Betty Huynh (SBN 315880)
TADJEDIN THOMAS & ENGBLOOM LAW Group LLP
6101 West Centinela Avenue, Suite 270
Culver City, CA 90230
T: (310) 362-4970
E: wendyt@ttelawgroup.com
E: justinr@ttelawgroup.com
Attorneys for FRINJ Coffee, Inc., John A. “Jay” Ruskey,
Andy Donald Mullins, and Kari Shafer
SUPERIOR COURT OF THE STATE OF CALIFORNIA
FOR THE COUNTY OF SANTA BARBARA
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11 PAIGE GESUALDO Case No. 23CV05305
12 Plaintiff, (Assigned for all purposes to the Honorable
Colleen K. Sterne, Department 5)
13 Vv.
14 JOHN A. “JAY” RUSKEY, an individual; DEFENDANT ANDY MULLINS’ NOTICE
ANDY DONALD MULLINS, an individual; OF DEMURRER AND DEMURRER TO
15 KARI SHAFER, an individual; FRINJ COFFEE. PLAINTIFF PAIGE GESUALDO’S
INC., a California corporation; and DOES 1-25, COMPLAINT; MEMORANDUM OF
16 inclusive, POINTS AND AUTHORITIES;
DECLARATION OF WENDY M. THOMAS
17 Defendants.
(Filed concurrently with [Proposed] Order)
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19 Date: TBD
Time: 10:00 a.m.
20 Dept.: 5
Judge: Hon. Colleen K. Sterne
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Action filed: December 1, 2023
22 Trial date: None set
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DEFENDANT ANDY MULLINS’ NOTICE OF DEMURRER AND
DEMURRER TO PLAINTIFF PAIGE GESUALDO’S COMPLAINT
TO ALL PARTIES AND THEIR COUNSEL OF RECORD HEREIN:
PLEASE TAKE NOTICE that, on TBD at 10:00 a.m., or as soon thereafter as
this matter may be heard by the Honorable Colleen K. Sterne in Department 5 of the above-entitled Court.
located at 1100 Anacapa Street, Santa Barbara, California 93101, Defendant Andy Mullins (“Mullins”
or “Defendant”) will and hereby does demur to Plaintiff Paige Gesualdo’s (“Plaintiff) Complaint
This Demurrer is brought on the grounds that:
(a) Plaintiff failed to state facts sufficient to constitute a cause of action as to her third cause
of action for aiding and abetting fraud (see Code Civ. Proc., § 430.10, subd. (e))
As explained in the Declaration of Wendy M. Thomas, pursuant to Code of Civil Procedure
10 section 430.41, subdivision (a)(2), the parties met and conferred but were unable to reach an agreement
11 concerning Defendant’s objections to Plaintiffs’ Complaint
12 This Demurrer is based on this notice, the attached Memorandum of Points and Authorities, the
13 Declaration of Wendy M. Thomas and exhibits attached thereto, all pleadings and papers filed in this
14 action, and such additional papers and arguments as may be presented at or in connection with the hearing
15 on this Demurrer.
16 Respectfully submitted.
17 Dated: February 5, 2024 mame Tyoyfis & ENGBLOOM LAw Group LLP
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19 By: Wns
Wendy M, Thomas
20 Betty Huyah —
Attorneys for FRINJ Coffee, Inc., John A. “Jay Ruskey,
21 Andy Donald Mullins, and Kari Shafer
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MEMORANDUM OF POINTS AND AUTHORITIES
DEMURRER
Defendant ANDY MULLINS (‘Mullins or “Defendant”) hereby demurs to Plaintiff PAIGE
GESUALDO’s (“Plaintiff”) Complaint as follows:
DEMURRER TO THIRD CAUSE OF ACTION FOR FRAUD —- AIDING AND ABETTING
FRAUD BASED ON FAILURE TO STATE A CAUSE OF ACTION
The cause of action for aiding and abetting fraud fails because Plaintiff failed to state specific
facts sufficient to support the claim that Defendant made a material misrepresentation of fact with
knowledge of its falsity and intent to deceive that caused Plaintiff's damages. (See Code of Civil Proc.,
§ 430.10 (e).)
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11 Respectfully submitted,
12 Dated: February 5, 2024 ‘TapseDin THomAS & ENGBLOOM LAW Group LLP
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KkUiwa27
By:
Wendy M. Thomas
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Betty Huynh
16 Attorneysfor FRINJ Coffee, Inc., John A. “Jay” Ruskey,
Andy Donald Mullins, and Kari Shafer
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MEMORANDUM OF POINTS AND AUTHORITIES
MEMORANDUM OF POINTS AND AUTHORITIES
I INTRODUCTION
Plaintiff Paige Gesualdo (‘Plaintiff’) alleges a cause of action for aiding and abetting fraud
against Defendant Andy Mullins (“Mullins” or “Defendant”) arising out of the allegation that Defendant
prepared certain documents which contain misrepresentations about FRINJ Coffee, Inc. (“Frinj’”) to
induce Plaintiff's investment. Specifically, Plaintiff alleges that Defendant prepared the “Slide Deck”
and “Geisha Model” which contained misrepresentations about Frinj’s operations and its financial
information. As shown below, Plaintiff's Complaint fails to state facts sufficient to meet the heightened
standard required for pleading fraud. There are no actual facts pleaded in the Complaint to show what
10 specific statements were made to the Plaintiff, and that the statements are material and are false. Instead,
11 Plaintiff's Complaint contains vague contentions and general conclusions such as the Slide Deck and
12 Geisha Model “materially overstated Frinj’s grower network,” “made material misrepresentations”
13 relating to Frinj’s research and coffee program, and “overstated Frinj’s income.” All that Plaintiff has
14 done in her Complaint with respect to the aiding and abetting fraud claim against Defendant is make
15 baseless contentions, without supporting facts. In ruling on a demurrer, while the Court must accept as
16 true properly pleaded material facts, the Court may not consider contentions, deductions, or conclusions
17 of fact or law. Plaintiff's Complaint is devoid of properly pleaded facts and would fail to state a claim
18 for aiding and abetting fraud even under a normal pleading standard, much less under the heightened
19 pleading standard required for fraud. Defendant requests that the Court sustain Defendant’s Demurrer.
20 IL. SUMMARY OF ALLEGATIONS IN THE COMPLAINT
21 Plaintiff filed her Complaint in this case on December 1, 2023, against defendants FRINJ Coffee,
22 Inc., John A “Jay” Ruskey (“Ruskey”), Andy Mullins, and Kari Shafer (“Shafer”). (Declaration of Wendy
23 Thomas (“Thomas Dec.”), Exhibit 1: Plaintiff's Complaint [“Ex. 1’’].) The Complaint alleges in pertinent
24 part as follows: Plaintiff alleges that Ruskey is the founder, CEO, and controlling shareholder of Frinj.
25 (Thomas Dec., Ex. 1, ¥ 5.) Plaintiff alleges that Mullins is a co-founder of Frinj, and was the Chief
26 Operations Officer from 2017 until late 2021 or early 2022. (/d, at 4 6.) Plaintiff alleges that Shafer is the
27 Vice President of Finance and Controller at Frinj. (/d., at § 7.)
28 Plaintiff alleges that Frinj was incorporated in May 2017 and is headquartered at Good Land
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MEMORANDUM OF POINTS AND AUTHORITIES
Organics (“GLO”), a farm that was founded in 1992 by Ruskey’s family. (Thomas Dec., § 2, Ex. 1, § 13.)
Plaintiff alleges that GLO is the heart, headquarters and flagship farm of Frinj Coffee, and Frinj has its
own website separate from GLO. (/d., at § 13.) Plaintiff alleges that she was introduced to Ruskey on
April 9, 2021. (d., at § 14.) Plaintiff alleges that to induce her to invest, Ruskey made representations to
Plaintiff about Frinj, and showed her a powerpoint slide deck (the “Slide Deck”) which contained material
misrepresentations about Frinj’s operations and value. (Thomas Dec., § 2, Ex. 1, § 17.) In particular,
Plaintiff alleges:
Among other things, the Slide Deck materially overstated FRINJ’s grower network, the
number of its coffee-producing trees, its average sales price, and the company’s fixed
target for Seed Round funding. The Slide Deck also made material misstatements relating
to the existence of Frinj’s research and development program, its coffee breeding
10 program, and the members of its executive team. (Thomas Dec., 4 2, Ex. 1, 18.)
11 Plaintiff alleges that the Slide Deck made no mention of GLO, and did not indicate that Frinj paid
12 for GLO’s expenses or operations. (Thomas Dec., § 2, Ex. 1, § 19.) Plaintiff alleges that Ruskey also
13 showed her unspecified documents relating to Project Geisha (the “Geisha Model”). (Thomas Dec., § 2,
14 Ex. 1, { 19.) Plaintiff alleges that the Geisha Model “was based on incomplete and inaccurate financial
15 records that did not account for all of Frinj’s liabilities, understated Frinj’s operating costs, overstated
16 Frinj’s net income, excluded the cost of supporting GLO and fraudulently overstated Frinj’s value and
17 projected future earnings.” (Thomas Dec., § 2, Ex. 1, § 82, bulletpoint no. 11.)
18 Plaintiff alleges a cause of action for aiding and abetting fraud against Mullins. (Thomas Dec., {
19 2, Ex. 1, p. 18.) Plaintiff alleges that Mullins had actual knowledge of the fraudulent and deceitful conduct
20 of Ruskey and Frinj, as Mullins was a Frinj executive and generated the documents that were relied upon.
21 (d., at §§ 101-102.) Specifically, Plaintiff alleges that “Mullins was involved in developing the Geisha
22 Model, Frinj’s Slide Deck, and overseeing Frinj’s operating costs. In so doing, Mullins gave substantial
23 assistance and encouragement to Frinj and Ruskey.” (Thomas Dec., J 2, Ex. 1, § 103.)
24 Til. DEFENDANT COMPLIED WITH THE MEET AND CONFER REQUIREMENTS
25 On January 29, 2024, Defendant’s counsel called Plaintiff's counsel to discuss Defendant’s
26 demurrer to Plaintiff's complaint. (Thomas Dec., §] 3.) This same day, Defendant’s counsel followed up
27 by sending Plaintiff a meet and confer letter which detailed the grounds for Defendant’s demurrer.
28 (Thomas Dec., § 4, Ex. 2.) The parties further met and conferred by phone conference on January 30,
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MEMORANDUM OF POINTS AND AUTHORITIES
2024, but were unable to resolve their dispute with respect to the Complaint. (Thomas Dec., { 5.)
Iv. LEGAL AUTHORITY
Among the purposes of the complaint in a civil action are framing and limiting the issues and
apprising the defendant of the grounds on which the plaintiff seeks to recover. (Committee on Children’s
Television v. General Foods Corp. (1983) 35 Cal.3d 197, 211-212, citations omitted.) Code of Civil
Procedure section 430.10, subdivision (e) permits a party against whom a complaint has been filed to
demur to a complaint on the ground that the complaint fails to state facts sufficient to constitute a cause
of action. The plaintiff must allege facts sufficient to establish every element of each cause of action.
(Cantu v. Resolution Trust Corp. (1992) 4 Cal.App.4th 857, 879 [Cantu].) In ruling on a demurrer, the
10 trial court may consider all material facts properly pleaded in the complaint, it may not consider
11 contentions, deductions, or conclusions of fact or law. (Young v. Gannon (2002) 97 Cal.App.4th 209,
12 220; Blank v. Kirwan (1985) 39 Cal.3d 311, 318 (Blank).) Allegations in the pleading must be factual
13 and specific, not vague or conclusionary. (Rakestraw v. California Physicians’ Service (App. 2 Dist. 200)
14 81 Cal.App.4th 39, 44.) General and indefinite contentions of liability will not satisfy the pleading rules;
15 “Tflacts, not conclusions, must be pleaded.” (Zumbrun v. Univ. of Calif (1972) 25 Cal.App.3d 1, 8.)
16 Moreover, if the defendant negates any essential element of a particular cause of action, the demurrer
17 should be sustained as to that cause of action. (Cantu, 4 Cal.App.4th at p. 880, citation omitted.)
18 V. ARGUMENTS
19 A The Complaint Fails to Allege Facts Sufficient to State a Cause of Action for Aiding
20 nd Abetting Fraud
21 A claim for aiding and abetting the commission of an intentional tort requires a showing that the
22 defendant (a) knows the other's conduct constitutes the intentional tort and gives substantial assistance or
23 encouragement to the other to so act or (b) gives substantial assistance to the other in accomplishing a
24 tortious result and the person's own conduct, separately considered, constitutes a breach of duty to the
25 third person.’ [Citations].” (Casey v. U.S. Bank Nat. Assn. (2005) 127 Cal.App.4th 1138, 1144.) “In the
26 civil arena, an aider and abettor is called a cotortfeasor. To be held liable as a cotortfeasor, a defendant
27 must have knowledge and intent.... A defendant can be held liable as a cotortfeasor on the basis of acting
28 in concert only if he or she knew that a tort had been, or was to be, committed, and acted with the intent
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of facilitating the commission of that tort.” (Gerard v. Ross (1988) 204 Cal.App.3d 968, 983.) An aider
and abettor must have “actual knowledge of the primary violation.” (Casey, supra, 127 Cal.App.4th at
1148.) Importantly, there can be no aiding and abetting liability absent the commission of an underlying
tort. (Nasrawi v. Buck Consultants LLC (2014) 231 Cal.App.4th 328, 344 ; Richard B. LeVine, Inc. v.
Higashi (2005) 131 Cal.App.4th 566, 574.) Thus, the Complaint must allege facts sufficient to show the
underlying fraud.
The essential elements of a claim for fraud are (1) a misrepresentation, (2) with knowledge of its
falsity, (3) with the intent to induce another’s reliance on the misrepresentation, (4) actual and justifiable
reliance, and (5) resulting damage. (Daniels v. Select Portfolio Servicing, Inc. (2016) 246 Cal.App.4th
10 1150, 1166.) The misrepresentation must pertain to a past or existing material fact. (Apollo Capital Fund,
11 LLC v. Roth Capital Partners, LLC (2007) 158 Cal.App.4th 226, 243.) Unless the facts can state a claim
12 for promissory fraud, representations about future actions are generally not actionable. (Miles v. Deutsche
13 Bank National Trust Co. (2015) 236 Cal.App.4th 394, 402 (Miles); Gentry v. eBay, Inc. (2002) 99
14 Cal.App.4th 816, 835.) Expressions of opinion are also not treated as representations of fact, and thus are
15 not grounds for a misrepresentation cause of action. (Neu-Visions Sports, Inc. v. Soren/McAdam/Bartells
16 (2000) 86 Cal.App.4th 303, 308.)
17 Crucially, to plead fraud, every element “we must be alleged in the proper manner and the facts
18 constituting the fraud must be alleged with sufficient specificity to allow [the] defendant to understand
19 fully the nature of the charge made.’ ” (Stansfield v. Starkey (1990) 220 Cal.App.3d 59, 73 (Stansfield),
20 quoting Roberts v. Ball, Hunt, Hart, Brown & Baerwitz (1976) 57 Cal.App.3d 104, 109.) “In California,
21 fraud must be pled specifically; general and conclusory allegations do not suffice.” (Lazar v. Superior
22 Court (1996) 12 Cal.4th 631, 645 (Lazar).) This specificity requirement applies to any and all actions
23 sounding in fraud. (City of Pomona v. Superior Court (2001) 89 Cal.App.4th 793, 803; Small v. Fritz
24 Co. ’s Inc. (2003) 30 Cal.4th 167, 184.) Thus “ ‘the policy of liberal construction of the pleadings ... will
25 not ordinarily be invoked to sustain a pleading defective in any material respect.’ [Citation.] This
26 particularity requirement necessitates pleading facts which ‘show how, when, where, to whom, and by
27 what means the representations were tendered.’ ” (Lazar v. Superior Court (1996) 12 Cal.4th 631, 645,
28 italics in original; see Stansfield, supra, 220 Cal.App.3d at p. 73.) Trial courts are to enforce this pleading
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requirement for fraud claims. (Robinson Helicopter Co., Inc. v. Dana Corp. (2004) 34 Cal.4th 979, 993.)
Here, Plaintiff failed to allege specific facts to plead each element of fraud. The basis of Plaintiff's
fraud claim against Defendant arises out of alleged misrepresentations contained in the Slide Deck and
Geisha Model that Defendant allegedly prepared. Despite this, the Complaint is devoid of any facts to
show what statements were actually contained in the Slide Deck and the Geisha Model that constituted a
misrepresentation. With respect to the first element, none of Plaintiff’s allegations about the Slide Deck
constitute facts to show that it contained any misrepresentations. Instead, all of Plaintiffs allegations are
vague contentions and general conclusions. For example, if Plaintiff contends that the Slide Deck
materially overstated the number of Frinj’s coffee producing trees, a pleading of facts would mean that
10 Plaintiff state what was the actual number of Frinj’s coffee producing trees, and what was the statement
11 that was made to Plaintiff about this number. This is the only way it can be shown that there was an actual
12 misstatement that was made to the Plaintiff about the trees. If Plaintiff contends that the Slide Deck
13 misrepresented the members of Frinj’s executive team, a pleading of facts would require Plaintiff to
14 allege who are the actual members of the executive team, and what was represented to Plaintiff, to show
15 that the statement was false. Plaintiff makes vague claims that the Slide Deck contains misstatements
16 about Frinj’s research and development program and coffee breeding program, but there is nothing in the
17 Complaint to show what statements were actually made, and why they are false. Likewise, there are no
18 facts pleaded to show what statements were made to the Plaintiff about the grower network or average
19 sales price, and how these statements constitute misrepresentations.
20 Plaintiff alleges that the Slide Deck falsely represented that Frinj’s Seed Round target was fixed
21 when the target was repeatedly increased by Frinj and Ruskey. (Thomas Dec., J] 2, Ex. 1, § 82, bulletpoint
22 no. 7.) This allegation is not sufficient to state fraud because a misrepresentation must pertain to a past
23 or existing fact; alleged subsequent conduct by Ruskey or Frinj is inadequate to state the claim that prior
24 statements about the Seed Round target made in the Slide Deck was false at the time that the statement
25 was made (i.e. when Mullins allegedly generated the Slide Deck). (Apollo, supra,158 Cal.App.4th 226,
26 243; Stockton Mortgage, Inc. v. Tope (2014) 233 Cal.App.4th 437 (“[a] representation generally is not
27 actionable unless it is about ‘past or existing facts. oo (citation omitted).) As alleged, the Complaint is
28 devoid of any facts to show what statements were made in the Slide Deck, and why those statements are
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false.
Similarly with the Geisha Model, Plaintiff does not allege what this model is, or what specific
statements were contained in the Geisha Model that constitute misrepresentations. Instead, Plaintiff
generally claims that the model “was based on incomplete and inaccurate financial records,” and
overstated Frinj’s operating costs and overstated Frinj’s net income. These are contentions, not facts. The
Complaint does not contain any facts that would show, with sufficient specificity under the heightened
pleading standard of fraud, what statements were made to the Plaintiff and how these statements are false.
All that Plaintiff
has done is make conclusory contentions that the Slide Deck and Geisha Model contain
misrepresentations about certain categories, without supporting facts. Such vague and general
10 contentions are not accepted as true for purposes of a demurrer, and are insufficient to plead the element
11 of misrepresentation.
12 In addition, Plaintiff failed to plead facts to show the elements of knowledge of falsity, materiality,
13 and reasonable reliance. Fraud requires specific intent to make a misrepresentation that is material, on
14 which the Plaintiff reasonably relied. (Daniels, supra, 246 Cal.App.4th at 1166.) Many of Plaintiffs
15 allegations are cursory and vague without any details to show that they are material. For example,
16 Plaintiff contends that the Slide Deck made material misstatements about “the members of its executive
17 team.” In addition to being insufficient to show a misrepresentation, this allegation fails to show why this
18 information is material to the Plaintiff and what misrepresentation was made that Plaintiff reasonably
19 relied on. Likewise, Plaintiff claims that the Geisha Model contains misrepresentations, but there is
20 nothing to show what the Geisha Model is, why it is material, or that Plaintiff relied on it.
21 Plaintiff's claim that the Slide Deck failed to disclose that Frinj was paying for GLO’s costs and
22 expenses fails to properly plead fraud for several reasons. First, this is a claim rooted in concealment, not
23 misrepresentation. “The required elements for fraudulent concealment are (1) concealment or
24 suppression of a material fact; (2) by a defendant with a duty to disclose the fact to the plaintiff; (3) the
25 defendant intended to defraud the plaintiff by intentionally concealing or suppressing the fact; (4) the
26 plaintiff
was unaware of the fact and would not have acted as he or she did if he or she had known of the
27 concealed or suppressed fact; and (5) plaintiff sustained damage as a result of the concealment or
28 suppression of the fact. [Citation.]” (Hambrick v. Healthcare Partners Medical Group, Inc. (2015) 238
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Cal.App.4th 124, 162.) The Complaint must contain allegations sufficient to establish a duty to disclose.
(Hambrick, 238 Cal.App.4th at 163.) There are “ ‘four circumstances in which nondisclosure or
concealment may constitute actionable fraud: (1) when the defendant is in a fiduciary relationship with
the plaintiff; (2) when the defendant had exclusive knowledge of material facts not known to the plaintiff;
(3) when the defendant actively conceals a material fact from the plaintiff; and (4) when the defendant
makes partial representations but also suppresses some material facts. [Citation.]’ [Citation.]” (LiMandri
v. Judkins (1997) 52 Cal.App.4th 326, 336, 60 Cal.Rptr.2d 539 (LiMandri ).) To state a cause of action
for fraudulent concealment, the defendant must have been under a duty to disclose some fact to the
plaintiff. (Hahn v. Mirda (2007) 147 Cal.App.4th 740, 745.)
10 With respect to duty to disclose, Plaintiff's Complaint is devoid of facts to make a showing that
11 the Slide Deck, which was allegedly a powerpoint presentation, was required to contain all of Frinj’s
12 financial information and liabilities such that its relationship with GLO was required to be disclosed in
13 the Slide Deck, and that the absence of this disclosure constituted actionable concealment. Plaintiff's
14 Complaint fails to allege any facts to show that Mullins, as chief operating officer, had a duty to disclose
15 any information to Plaintiff with respect to her investment, or that he had any knowledge concerning
16 what information was or not previously disclosed to Plaintiff. Plaintiff's Complaint does not allege that
17 Mullins had any interactions with her relating to her investment, that he made any representations to the
18 Plaintiff directly, or that he even knew that the Slide Deck or Geisha Model were presented to the
19 Plaintiff. As alleged, Plaintiff's Complaint is wholly defective in establishing a claim that Mullins’
20 alleged preparation of the Slide Deck at some undefined time, and the subsequent presentation of the
21 Slide Deck to Plaintiff at a later time by Ruskey shows that Mullins aided and abetted fraudulent
22 concealment of information.
23 Plaintiff's allegation with respect to GLO also fails to establish the elements of misrepresentation
24 and materiality. Plaintiff does not allege that GLO is a separate third party entity. Instead Plaintiff alleges
25 that GLO is the “heart, headquarters, and flagship farm of FRINJ coffee” (Thomas Dec., 2, Ex. 1, § 13).
26 Plaintiff's contention that Frinj has a separate website from GLO is immaterial and has no bearing on
27 whether GLO and Frinj are separate entities. The Complaint does not allege any facts to establish why it
28 is a material and fraudulent omission that Frinj did not disclose it was paying for the costs of its “heart,
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headquarters, and flagship farm.” There are also no allegations to establish that this information is
material, as the Complaint does not allege any facts to show what, if any, costs or expenses were actually
paid, or the value of such costs that it would constitute a material fact. There is a marked difference
between paying for hundreds of dollars in GLO’s alleged costs versus hundreds of thousands of dollars
in costs.
A demurrer tests the legal sufficiency of the pleading, and the plaintiff must show that the
complaint alleges facts sufficient to establish every element of each cause of action. (Rakestraw, supra,
6 Cal.Rptr.2d at 356.) Allegations in the pleading must be factual and specific, not vague or
conclusionary. (/bid.) In ruling on a demurrer, the trial court may consider all material facts properly
10 pleaded in the complaint, but it may not consider contentions, deductions or conclusions of fact or law.
11 (Young, supra, 97 Cal.App.4th at 220.) Plaintiff's allegations would fail even under a normal pleading
12 standard, much less under the heightened pleading standard required for fraud. Procedural due process
13 requires that a defendant be given notice of the specific claims and relief which is sought against him in
14 a complaint. (Van Sickle v. Gilbert (2011) 196 Cal.App.4th 1495, 1520.) Where a complaint is drafted
15 in such a manner that the defendant cannot reasonably respond, i.e., the defendant cannot determine what
16 issues must be admitted or denied, or what counts are directed against the defendant, a demurrer on the
17 ground that the pleading is uncertain should be sustained. (Khoury v. Maly's of California, Inc. (1993) 14
18 Cal.App.4th 612, 616.) Defendant cannot respond to a fraud claim that fails to even identify the specific
19 misrepresentations that were allegedly made by him, and why those statements are false.
20 VI CONCLUSION
21 Defendant requests that the Court sustain Defendant ‘Pome: to Plaintiffs’ Complaint.
22 Dated: February 5, 2024 TapsEDIN THOMAS & ENGBLOOM LAw Group LLP
wre
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24 By:
Wendy M.\Thomas
Betty Huynh—
25 Attorneys for FRINJ Coffee, Inc., John A. “Jay Ruskey,
Andy Donald Mullins, and Kari Shafer
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MEMORANDUM OF POINTS AND AUTHORITIES
DECLARATION OF WENDY M. THOMAS
I, Wendy M. Thomas, declare that I am an attorney at law admitted to practice in state and
federal courts in California, including this Court. I am a partner at Tadjedin Thomas & Engbloom
Law Group LLP, attorneys of record for Defendant Andy Mullins (“Defendant”). I testify to these
facts of my own personal knowledge and, if called as a witness, could and would testify competently
thereto under oath.
1 I submit this declaration in support of Defendant Andy Mullins’ Demurrer to Plaintiff
Paige Gesualdo’s (‘Plaintiff’) Complaint regarding my compliance with the meet and confer
requirements imposed by Code of Civil Procedure section 430.41 before any demurrer may be filed
10 with the court.
11 2 On or about December 1, 2023, Plaintiff filed a Complaint in this case against
12 Defendant. The Complaint was served on Defendant on or about January 6, 2024. Attached hereto as
13 Exhibit 1 is a true and correct copy of Plaintiff's Complaint.
14 3 On January 29, 2024, I spoke to Plaintiff’s counsel by phone regarding the Demurrer
15 that Defendant intended to file to Plaintiff's Complaint.
16 4 Later this same day, I emailed a meet and confer letter to Plaintiffs’ counsel which
17 detailed the grounds for Defendant’s Demurrer. Attached hereto as Exhibit 2 is a true and correct
18 copy of pertinent pages of the email correspondence, with the attached meet and confer letter that I
19 sent to Plaintiffs’ counsel on January 29, 2024.
20 5 On January 30, 2024, the parties further met and conferred by phone conference
21 regarding the demurrer, but the parties were unable to resolve their disputes concerning Defendant’s
22 objections to the Complaint.
23 I declare under penalty of perjury under the laws of the State of California that the foregoing
24 is true and correct.
25 Executed this 5th day of February, 2024 in Marina Ds Rey, California.
26
Yu WW.
27 Wendy M. Thomas”
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DECLARATION OF WENDY M. THOMAS RE MEET AND CONFER COMPLIANCE
EXHIBIT 1
(Page 1 of 50)
ELECTRONICALLY FILED
Superior Court of California
County of Santa Barbara
Darrel E. Parker, Executive Officer
JEFFER MANGELS BUTLER & MITCHELI, LP 12/1/2023 5:21
ANDREW I. SHADOFF (Bar No. 272319) By: Narzralli Baksh , Deputy
ashadoy jmbm.com
SHAVON HENRY (Bar No. 326855)
shenry@jmbm.com.
RAFF J. COGAN (Bar No. 317060)
reogan@jmbm.com
1900 Avenue of the Stars, 7th Floor
Los Angeles, California 90067-4308
Telephone: (310) 203-8080
Facsimile: (310) 203-0567
Attorneys for Plaintiff PAIGE GESUALDO
SUPERIOR COURT OF THE STATE OF CALIFORNIA.
COUNTY OF SANTA BARBARA
10 ANACAPA DIVISION
23CV05305
11 PAIGE GESUALDO, Case No.
os 12 Plaintiff, COMPLAINT FOR:
BE
$a 13 Vv. (1) FRAUD;
2 (2) NEGLIGENT
sa u JOHN A. “JAY” RUSKEY, an individual; MISREPRESENTATION;
ANDY DONALD MULLINS, an individual;
(3) AIDING AND ABETTING FRAUD,
15 KARI SHAFER, an individual, FRINJ
COFFEE, INC., a California corporation: and (4) CANCELLATION OF WRITTEN
16 DOES 1-25 inclusive, INSTRUMENTS;
(5) FAILURE TO PAY WAGES;
17 Defendants. (6) FAILURE TO PAY OVERTIME
WAGES;
18 (7) FAILURE TO PROVIDE MEAL
19 PERIODS AND PAY MEAL PERIOD
PENALTIES;
20 (8) FATLURE TO AUTHORIZE AND
PERMIT REST BREAKS AND PAY REST
21 BREAK PENALTIES;
(9) FAILURE TO PAY TIMELY WAGES;
22 (10) FAILURE TO PROVIDE
23 ACCURATE, ITEMIZED WAGE
STATEMENTS;
24 (1) FAILURE TO PROVIDE WAGES AT
SEPARATION;
25 (12) FAILURE TO REIMBURSE
NECESSARY BUSINESS EXPENSES;
26 (13) VIOLATION OF CALIFORNIA
27 LABOR CODE §§ 970 AND 972;
(14) BREACH OF CONTRACT,
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COMPLAINT
(Page 2 of 50)
(15) VIOLATION OF CALIFORNIA’S
EQUAL PAY ACT;
(16) DISCRIMINATION IN VIOLATION
OF GOVT. CODE §§ 12940 ET SEQ.;
(17) RETALIATION IN VIOLATION OF
GOVT. CODE §§ 12940 ET SEQ;
(18) FATLURE TO PRE NT
DISCRIMINATION, RETALIATION IN
VIOLATION OF GOVT. CODE §
12940(K);
(19) WRONGFUL / CONSTRUCTIVE
DISCHARGE; AND
(20) VIOLATION OF CALIFORNIA
BUSINESS AND PROFESSIONS CODE §§
17200 ET SEQ.
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For her Complaint against Defendants John A. “Jay” Ruskey (“Ruskey”), Andy Donald
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Mullins (“Mullins”), Kari Shafer (“Shafer”), Frinj Coffee, Ine. (“Frinj”), and DOES 1 through 25
as 12
BE inclusive (collectively, “Defendants”), Plaintiff Paige Gesualdo (“Gesualdo”) alleges as follows:
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2= THE PARTIES, JURISDICTION AND VENUE
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1 Plaintiff Gesualdo is, and at all times relevant hereto was, an individual residing in
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the State of California.
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2. Gesualdo is informed and believes and thereon alleges that Defendant Ruskey is,
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and at all times relevant hereto was, an individual residing in the State of California, County of
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Santa Barbara.
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3 Gesualdo is informed and believes and thereon alleges that Defendant Mullins is,
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and at all times relevant hereto was, an individual residing in the State of California, County of
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Riverside.
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4 Gesualdo is informed and believes and thereon alleges that Defendant Shafer is.
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and at all times relevant hereto was, an individual residing in the State of California, County of
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Santa Barbara.
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5 Defendant Frinj is, and at all times relevant hereto was, a California corporation
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with its principal place of business in Goleta, California. Ruskcy is, and at all times relevant
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hereto was, the founder, CEO, and controlling shareholder of Frinj.
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COMPLAINT
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6 Mullins is a. co-founder of Fring. Gesnaldo is informed and believes and thereon
alleges that, from at least 2017 until approximately late 2021 or early 2022, Mullins was the Chief
Operations Officer of Frinj.
7. Gesualdo is informed and believes and thereon alleges that Shafer is, and at all
times relevant hereto was, the Vice President of Finance and Controller of Frinj.
8. Plaintiff is unaware of the true names or capacities, whether individual, corporate,
associate, or otherwise, of defendants DOES 1 through 25, inclusive. Plaintiff therefore sues said
defendants by such fictitious names. Plaintiff will amend this Complaint to show the true names or
capacities of those DOE defendants when the same have been ascertained. Frinj and DOES 1
10 through 25, inclusive, are referred to herein as “Defendants.” Plaintiff is informed and believes and
11 thereon alleges that, at all times mentioned herein, each of the defendants was the agent, employee,
at 12 and/or alter ego of each of the other defendants, respectively, and each was at all times herein acting
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15 9. This Court has subject matter jurisdiction over any and all causcs of action asserted
16 herein pursuant to Article VI, Section 10 of the California Constitution and California Code of Civil
17 Procedure Sections 88 and 410.10 because this is a civil action in which the matter in controversy,
18 not including attorneys’ tees, interests, and costs, exceeds $25,000, and hecanse each canse of action
19 arises under the laws of the State of California or is subject to adjudication in the courts of the State
20 of California.
21 10. This Court has personal jurisdiction over Defendants because Defendants have
22 caused injuries in the County of Santa Barbara and State of California through their acts, and by
23 their violations of California law.
24 11 Venue is proper in this Court pursuant to California Code of Civil Procedure Section
25 395(a) because Defendant Frinj is located in Santa Barbara County, Defendants Ruskey and Shafer
26 reside in Santa Barbara County, and Defendants do business in Santa Barbara County.
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COMPLAINT
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ALLEGATIONS COMMON TO CAUSES OF ACTION 1 THROUGH 4
In April 2021, Gesualdo was Introduced to Ruskey and Frinj
12. Frinj was incorporated in May 2017.
13. Trinj is headquartered at Good Land Organics (“GLO”), a farm that was founded in
1992 by Ruskey’s family. GLO explains on its website that “[w]hat started as a coffee program at
Good Land Organics in 2012 became FRINJ Coffee, Inc. in 2018.[...] Today, Good Land
Organics is the heart, headquarters and flagship farm of FRINJ Coffee.” Frinj has its own website
that is separate from GLO’s website.
14, On April 9, 2021, after being introduced by a third party, Gesualdo met Ruskey at
10 GLO because she was seeking out a California coffee farm to utilize for her own California-grown
11 coffee business venture (the “Initial Meeting”).
12 15. During the Initial Meeting, Ruskey told Gesualdo that his family trust owned the
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$a 13 property on which Frinj operated and that he controlled the trust (and, therefore, the land on which
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sa u Frinj operated). This was a lie. Ruskey was not then and has not ever controlled the trust that
15 owns the property on which Frinj has operated. Rather, Ruskey’s father controlled and controls
16 that trust and therefore the land on which Frinj has operated. Ruskey concealed from Gesualdo
17 the fact that Frinj operated subject to a lease agreement with a third party over which he had no
18 control.
19 16. During the Initial Meeting, Ruskey also told Gesualdo that Frinj’s Seed Round of
20 investor financing was underway. Calling Frinj the “future of California coffee,” and likening its
21 potential to California’s wine industry, Ruskey pitched Gesualdo on investing in Frinj.
22 TZ, To induce Gesualdo to invest, Ruskey showed Gesualdo a PowerPoint slide deck
23 (the “Slide Deck’’), which purported to accurately reflect Frinj’s business operations. The Slide
24 Deck contained material misrepresentations about Frinj’s operations and value.
25 18. Among other things, the Slide Deck materially overstated Frinj’s grower network,
26 the number of its coffce-producing trees, its average sales price, and the company’s fixed target
27 for Seed Round funding. The Slide Deck also made material misstatements relating to the
28 existence of Frinj*s research and development program, its coffee breeding program, and the
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COMPLAINT
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memhers of its executive team
19, Notably, the Slide Deck made no mention of GLO, and did not indicate that Frinj
paid for GLO’s expenses or operations.
20. To further induce Gesualdo to invest, Ruskey also showed Gesualdo financial
documents purporting to contain an accurate overview of Frinj’s financial situation. Ruskey
provided Gesualdo with the following documents: Statement of Assets, Liabilities & Equity as of
December 31, 2019; Statement of Assets, Liabilities & Equity as of June 30, 2020: Quarterly
Revenue & Expenses Summary, January —June 2020; and Project Geisha (“Geisha Model”).
21. These financial documents were incomplete, inaccurate, significantly overstated
10 Frinj’s income, and significantly understated Frinj’s liabilities and operating costs. In particular,
11 Frinj owed significant backpay and reimbursements to its emplovees, owed past due bills at a
at 12 plant growth nursery called Por La Mar, and owed ongoing monthly payments for an undisclosed
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