No Value: ARNTSEN FAMILY PARTNERSHIP, LP, et al vs. GREGORY J DAVIS, et al

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                                1   Brian Zimmerman (admitted pro hac vice)
     Nicholas Reisch (admitted pro hac vice)
 2   Jessica E. Chong (SBN 317869)
     SPENCER FANE LLP
 3   3040 Post Oak Blvd., Suite 1400
     Houston, TX 77056
 4   (713) 552-1234 telephone

 5   Ernesto F. Aldover (SBN 157625)
     RETZ & ALDOVER, LLP
 6   2550 Via Tejon, Suite 3A
     Palos Verdes Estates, California 90274
 7   (310) 540-9800 telephone

 8   Attorneys for Defendants
     SVRV 385 Moore, LLC; SVRV 387 Moore,
 9   LLC; Gregory J. Davis; Kevin Wolfe; Jason
10   Justesen; Paramont Woodside, LLC;
     Paramont Capital, LLC; Monks Family Trust;
11   TEH Capital, LLC; Caproc III, LLC; WZ
     Partners LLC; McLan Trust; Wild Rose
12   Irrevocable Trust; Black Horse Holdings,
13   LLC; Phil Stoker; Diane Stoker; Scott O’Neil;
     and Dale Huish
14
                SUPERIOR COURT OF THE STATE OF CALIFORNIA
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16                             COUNTY OF SAN MATEO

17   Robert Arntsen; Mary Lee; Arntsen           Case No. 22-CIV-01148
     Family Partnership, LP; and Brian           with Case No. 22-CIV-01099
18   Christopher Dunn Custodianship;
                                                 PROPOSED STATEMENT TO BE
19                              Plaintiffs,      READ TO JURY PANEL

20            -vs-
                                            [Hon. Jeffrey R. Finigan]
21   David M. Bragg; Kurtis Stuart Kludt;
     Silicon Valley Real Ventures, LLC;     DEPT.: 24
22   SVRV 385 Moore, LLC; SVRV 387
     Moore, LLC; Gregory J. Davis; Paramont
23   Woodside, LLC; and Paramont Capital,
     LLC;
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                                 Defendants.
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                                              -1-
                          PROPOSED STATEMENT TO BE READ TO JURY PANEL
 1
      John Ho and Quanyu Huang;
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                                  Plaintiffs,
 3
               -vs-
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      David M. Bragg; Silicon Valley Real
 5    Ventures, LLC; SVRV 385 Moore, LLC;
      SVRV 387 Moore, LLC; Gregory J.
 6    Davis; Kevin Wolfe; Jason Justesen;
      Paramont Woodside, LLC; Paramont
 7    Capital, LLC; Monks Family Trust; TEH
      Capital, LLC; Caproc III, LLC; WZ
 8    Partners LLC; McLan Trust; Wild Rose
      Irrevocable Trust; Black Horse Holdings,
 9    LLC; Phil Stoker; Diane Stoker; Scott
      O’Neil; and Dale Huish;
10
                                    Defendants.
11

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           Plaintiffs provided funds to Defendants David Bragg or Silicon Valley Real
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     Ventures, LLC (SVRV) in relation to an investment in a real estate project involving
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     two properties located at 385 and 387 Moore Road located in Woodside, California.
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     Defendant SVRV entered into separate written operating agreements with Paramont
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     Woodside LLC. Under those written agreements, Paramont Woodside agreed to
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     provide $2 million dollars to SVRV 385 Moore, LLC and SVRV 387 Moore, LLC
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     (“Moore Road LLCs”) needed to purchase each property. Thereafter, the properties
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     were purchased, with additional funds coming from Genesis Capital as loans.
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           As part of the written agreement between Defendant SVRV and Paramont
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     Woodside, SVRV also agreed to provide all additional funds needed by the Moore Road
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     LLCs, but failed to do so. Paramont Woodside contributed additional funds and took
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     over management of the project. The properties were eventually sold but the net
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     proceeds from the sales were not sufficient to pay back Paramont Woodside’s $2.2
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     million investment and its preferred return. So, all net proceeds went to Paramont
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     Woodside. Plaintiffs did not receive any part of the proceeds from the sale. Bragg
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     received a broker’s fee, but no other proceeds from the sale.
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                                                 -2-
                             PROPOSED STATEMENT TO BE READ TO JURY PANEL
 1         Plaintiffs allege that they contributed money to and were members in the Moore

 2   Road LLCs. Plaintiffs allege that they were entitled to a pro rata distribution of

 3   proceeds from the sale of the Moore Road properties, but that the Defendants

 4   conspired to take all proceeds from the sale of the Moore Road properties for

 5   themselves. Plaintiffs also allege that Defendant Bragg misappropriated funds from

 6   the Moore Road LLCs for other real estate projects and his personal enrichment.

 7         All Defendants deny all of Plaintiffs allegations brought against them.

 8   Defendants Bragg and SVRV contend that 1) Plaintiffs were accredited investors, who

 9   understood the risks involved with development of the project, including the risk that
10   there could be no return on their investments, 2) Plaintiffs were passive investors with

11   no authority over the project and invested in it anyways, with Bragg as the manager,

12   and 3) Bragg was authorized to have sole and exclusive managerial authority over the

13   project, which included raising additional funds from a third party and disclosed to

14   Plaintiffs that later investors could sign on to the project as a preferred class ahead of

15   them, as set forth in Plaintiffs’ investor agreements.

16         All Defendants other than Bragg and SVRV contend that they 1) did not know

17   any of Plaintiffs and never communicated with them, 2) were unaware of Plaintiffs’

18   claims that they were members of the Moore Road LLCs, and 3) were not involved in

19   any of Bragg or SVRV’s conduct and actions concerning Plaintiffs. They further
20   contend they are entitled to the proceeds of the property sales under Paramont

21   Woodside’s written agreements with SVRV and that the properties never could have

22   been purchased without Paramont Woodside’s $2 million investment.

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                                                 -3-
                             PROPOSED STATEMENT TO BE READ TO JURY PANEL
 1                                   PROOF OF SERVICE
 2
     STATE OF NEVADA, COUNTY OF CLARK
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     I am employed in the county of Las Vegas State of Nevada. I am over the age of 18
 4   and not a party to the action; my business address is 300 S. Fourth Street, Suite 950
     Las Vegas, NV 89101.
 5

 6   On February 19, 2024, I served the foregoing document(s) described as PROPOSED
     STATEMENT TO JURY as follows:
 7
      Collin J. Vierra (State Bar No. 322720)          Ryan van Steenis (S.B. #254542)
 8    EIMER STAHL LLP                                  1601 S Shepherd Dr., #276
      99 Almaden Blvd., Suite 641                      Houston, Texas 77019
 9                                                     rjvansteenis@gmail.com
      San Jose, CA 95113-1605                          ATTORNEY FOR DEFENDANTS
10    Email: cvierra@eimerstahl.com                    DAVID M. BRAGG AND SILICON
      ATTORNEY FOR PLAINTIFFS                          VALLEY REAL VENTURES, LLC
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      _ _ (BY US MAIL) As follows: I am “readily familiar” with the firm’s practice of
13   collection and processing correspondence for mailing. Under that practice it would be
     deposited with the U.S. Postal Service on that same day with postage thereon fully
14   prepaid at Palos Verdes Estate, CA in the ordinary cause of business. I am aware that
     on motion of the party served, service is presumed invalid of postal cancellation date
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     or postage meter is more than one day after date of deposit for mailing an affidavit.
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     _X_ (BY ELECTRONIC SERVICE) I electronically served the foregoing document(s)
17   on opposing counsel via electronic mail.
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     ___ (BY OVERNIGHT MAIL) By depositing copies of the above documents in a box
19   or other facility regularly maintained by General Logistics Systems US with delivery
     fees paid or provided for, addressed to the individual listed above, at the address listed
20   above. [C.C.P. §§ 1013(c), 2015.5]
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      X (STATE) I declare under penalty of perjury under the laws of the State of Nevada
22   that the foregoing is true and correct.

23   Executed on February 19, 2024 at Las Vegas, Nevada.
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                                              /s/ Adam Miller
25                                            Adam Miller

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                             PROPOSED STATEMENT TO BE READ TO JURY PANEL