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, LLC;
 9   Gregory J. Davis; Kevin Wolfe; Jason Justesen;
     Paramont Woodside, LLC; Paramont Capital, LLC;
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     Monks Family Trust; TEH Capital, LLC; Caproc III,
11   LLC; WZ Partners LLC; McLan Trust; Wild Rose
     Irrevocable Trust; Black Horse Holdings, LLC; Phil
12   Stoker; Diane Stoker; Scott O’Neil; and Dale Huish
13                   SUPERIOR COURT OF THE STATE OF CALIFORNIA
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                                    COUNTY OF SAN MATEO
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     Robert Arntsen; Mary Lee; Arntsen Family          Case No. 22-CIV-01148
16   Partnership, LP; and Brian Christopher Dunn       with Case No. 22-CIV-01099
     Custodianship;
17                                                      PARAMONT DEFENDANTS’ AMENDED
                                Plaintiffs,                 PROPOSED SPECIAL JURY
18                                                              INSTRUCTIONS
              -vs-
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     David M. Bragg; Kurtis Stuart Kludt; Silicon
20   Valley Real Ventures, LLC; SVRV 385 Moore,        [Hon. Jeffrey R. Finigan]
     LLC; SVRV 387 Moore, LLC; Gregory J.
21   Davis; Paramont Woodside, LLC; and                Dept.: 24
     Paramont Capital, LLC;
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                                  Defendants.
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     Defs. Am. Proposed Jury Instructions       Page 1 of 12
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      John Ho and Quanyu Huang;
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                                   Plaintiffs,
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                -vs-
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      David M. Bragg; Silicon Valley Real Ventures,
 5    LLC; SVRV 385 Moore, LLC; SVRV 387
      Moore, LLC; Gregory J. Davis; Kevin Wolfe;
 6    Jason Justesen; Paramont Woodside, LLC;
      Paramont Capital, LLC; Monks Family Trust;
 7    TEH Capital, LLC; Caproc III, LLC; WZ
      Partners LLC; McLan Trust; Wild Rose
 8    Irrevocable Trust; Black Horse Holdings, LLC;
      Phil Stoker; Diane Stoker; Scott O’Neil; and
 9    Dale Huish;
10                                  Defendants.
11

12          Defendants SVRV 385 Moore, LLC, SVRV 387 Moore, LLC, Gregory J. Davis, Paramont
13   Woodside, LLC, and Paramont Capital, Monks Family Trust, THE Capital, LLC, Caproc III, LLC,
14   WZ Partners LLC, McLan Trust, Wild Rose Irrevocable Trust, Black Horse Holdings, LLC, Phil
15   Stoker, Diane Stoker, Scott O’Neil, Dale Huish, submit these amended proposed special jury
16   instructions.
17          This is only meant as an amendment to the special jurisdictions nos. 1-5 submitted by
18   Defendants, not any CACI instructions. The Defendants request submission of the previously
19   proposed CACI instructions.
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      Defs. Am. Proposed Jury Instructions        Page 2 of 12
 1   Dated: March 29, 2024

 2                                                   SPENCER FANE LLP

 3                                           By:     /s/ Jessica E. Chong
                                                     Jessica E. Chong (SBN 317869)
 4                                                   Brian Zimmerman
                                                     (admitted pro hac vice)
 5                                                   Nicholas Reisch
                                                     (admitted pro hac vice)
 6                                                   SPENCER FANE LLP
                                                     300 South Fourth Street, Suite 950
 7                                                   Las Vegas, NV 89101
 8                                                    and
 9                                                   Ernesto F. Aldover, Esq.
                                                      RETZ & ALDOVER, LLP
10                                                    2550 Via Tejon, Suite 3A
                                                      Palos Verdes Estates, CA 90274
11                                                   Attorneys for Defendants
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      Defs. Am. Proposed Jury Instructions   Page 3 of 12
 1   Special Jury Status of                 Given as          Given as Refused Withdrawn
     Instructions agreement                 proposed          modified
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     Am.     Special
 3   Instruction
     No. 1
 4
     Am.     Special
 5   Instruction
     No. 2
 6
     Am.     Special
 7   Instruction
     No. 3
 8
     Am.     Special
 9   Instruction
     No. 4a
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     Instruction
11   No. 4b
12   Instruction
     No. 4c
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14   Am.     Special
     Instruction
15   No. 5

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     Defs. Am. Proposed Jury Instructions      Page 4 of 12
 1   Amended Special Instruction No. 1

 2   If a limited liability company is to have only one member upon formation, the person
     becomes a member as agreed by that person and the organizer of the limited liability
 3   company. That person and the organizer may be, but need not be, different persons.
     If different, the organizer acts on behalf of the initial member.
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     If a limited liability company is to have more than one member upon formation, those
 5   persons become members as agreed by the persons before the formation of the limited
     liability company. The organizer acts on behalf of the persons in forming the limited
 6   liability company and may be, but need not be, one of the persons.

 7   After formation of a limited liability company, a person becomes a member as follows:
     (1) As provided in the operating agreement.
 8   (2) [omitted as inapplicable]
     (3) With the consent of all the members.
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     Citation of Authorities
10   Corp. Code, § 17704.01

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     Defs. Am. Proposed Jury Instructions   Page 5 of 12
 1   Amended Special Instruction No. 2

 2   (a) [omitted as inapplicable]

 3   (b) If the articles of organization indicate that the limited liability company is a
     manager-managed limited liability company, each of the following applies:
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     (1) No member acting solely in the capacity of a member is an agent of the limited
 5   liability company nor can any member bind or execute any instrument on behalf of
     the limited liability company.
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     (2) Every manager is an agent of the limited liability company for the purpose of its
 7   business or affairs, and the act of any manager, including, but not limited to, the
     execution in the name of the limited liability company of any instrument for
 8   apparently carrying on in the usual way the business or affairs of the limited liability
     company of which the person is a manager, binds the limited liability company, unless
 9   the manager so acting has, in fact, no authority to act for the limited liability company
     in the particular matter and the person with whom the manager is dealing has actual
10   knowledge of the fact that the manager has no such authority.

11   (c) No act of a manager or member in contravention of a restriction on authority shall
     bind the limited liability company to persons having actual knowledge of the
12   restriction.

13   (d) Notwithstanding the provisions of subdivision (c), any note, mortgage, evidence of
     indebtedness, contract, certificate, statement, conveyance, or other instrument in
14   writing, and any assignment or endorsement thereof, executed or entered into
     between any limited liability company and any other person, when signed by at least
15   two managers, or by one manager in the case of a limited liability company whose
     articles of organization state that it is managed by only one manager, is not
16   invalidated as to the limited liability company by any lack of authority of the signing
     managers or manager in the absence of actual knowledge on the part of the other
17   person that the signing managers or manager had no authority to execute the same.

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     Citation of Authorities
19   Corp. Code §17703.01.

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      Defs. Am. Proposed Jury Instructions   Page 6 of 12
 1   Amended Special Instruction No. 3

 2   (a) A limited liability company is bound by and may enforce the operating agreement.

 3   (b) A person that becomes a member of a limited liability company is deemed to assent
     to the operating agreement.
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     (c) Two or more persons intending to become the initial members of a limited liability
 5   company may make an agreement providing that upon the formation of the limited
     liability company the agreement will become the operating agreement. One person
 6   intending to become the initial member of a limited liability company may assent to
     terms providing that upon the formation of the limited liability company the terms
 7   will become the operating agreement.

 8   Citation of Authorities
     Corp. Code §17701.11.
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     Defs. Am. Proposed Jury Instructions   Page 7 of 12
 1   Amended Special Instruction No. 4a

 2   (a) The fiduciary duties that a member owes to a member-managed limited liability
     company and the other members of the limited liability company are the duties of
 3   loyalty and care under subdivisions (b) and (c).

 4   (b) A member's duty of loyalty to the limited liability company and the other members
     is limited to the following:
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            (1) To account to the limited liability company and hold as trustee for it any
 6          property, profit, or benefit derived by the member in the conduct and winding
            up of the activities of a limited liability company or derived from a use by the
 7          member of a limited liability company property, including the appropriation of
            a limited liability company opportunity.
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            (2) To refrain from dealing with the limited liability company in the conduct or
 9          winding up of the activities of the limited liability company as or on behalf of a
            person having an interest adverse to the limited liability company.
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            (3) To refrain from competing with the limited liability company in the conduct
11          or winding up of the activities of the limited liability company.

12   (c) A member's duty of care to a limited liability company and the other members in
     the conduct and winding up of the activities of the limited liability company is limited
13   to refraining from engaging in grossly negligent or reckless conduct, intentional
     misconduct, or a knowing violation of law.
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     (d) A member shall discharge the duties to a limited liability company and the other
15   members under this title or under the operating agreement and exercise any rights
     consistent with the obligation of good faith and fair dealing.
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     (e) A member does not violate a duty or obligation under this article or under the
17   operating agreement merely because the member's conduct furthers the member's
     own interest.
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     (f) In a manager-managed limited liability company, all of the following rules apply:
19           (1) Subdivisions (a), (b), (c), and (e) apply to the manager or managers and not
     the members.
20           (2) Subdivision (d) applies to the members and managers.
             (3) Except as otherwise provided, a member does not have any fiduciary duty
21           to the limited liability company or to any other member solely by reason of being
             a member.
22           Credits

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     Citation of Authorities
24   Corp. Code 17704.09.

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      Defs. Am. Proposed Jury Instructions   Page 8 of 12
 1   Amended Special Instruction No. 4b

 2   Gross negligence is the want of even scant care or an extreme departure from the
     ordinary standard of conduct.
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     Citation of Authorities
 5   Van Meter v. Bent Construction Co. (1956) 46 Cal.2d 588, 594

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     Defs. Am. Proposed Jury Instructions   Page 9 of 12
 1   Amended Special Instruction No. 4c

 2   In every contract or agreement there is an implied promise of good faith and fair
     dealing. This implied promise means that each party will not do anything to unfairly
 3   interfere with the right of any other party to receive the benefit of the contract. Good
     faith means honesty of purpose without any intention to mislead or to take unfair
 4   advantage of another. Generally speaking, it means being faithful to one’s duty or
     obligation. However, the implied promise of good faith and fair dealing cannot create
 5   obligations that are inconsistent with the terms of the contract.

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     Citation of Authorities
 7   CACI 325 Breach of Implied Covenant of Good Faith and Fair Dealing—Essential
     Factual Elements [Remaining instruction omitted because only the definition is
 8   relevant as a definition for fiduciary duty claim]

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      Defs. Am. Proposed Jury Instructions   Page 10 of 12
 1   Am. Special Instruction No. 5

 2   Ratification is the voluntary election by a person to adopt in some manner as his own
     an act which was purportedly done on his behalf by another person, the effect of which,
 3   as to some or all persons, is to treat the act as if originally authorized by him.

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     Citation of Authorities
 6   CACI 3710 Ratification

 7   Rakestraw v. Rodrigues (1972) 8 Cal.3d 67, 73

 8      To this barrier of damnum absque injuria must be added these further
        significant facts. The WHA president testified, and the corporate minutes
 9      confirmed, the assembled WHA board by unanimous consent expressly ratified
        the telephonic approval of the transfer to Metro-Sports. Based upon this
10      evidence, introduced as part of the cross-complainant's case-in-chief,
        the trial court concluded the complained-of act had been in fact
11      ratified. Upon this basis the trial court granted the nonsuit.

12      There is no dispute as to the fact of ratification. This being true, it is
        difficult to conceive how a breach of fiduciary duty may exist in face
13      of the ratification, an approval in the precise manner required by Delaware
        law. But WHA is not deterred by this reasoning. It avers the defense of
14      ratification was not pleaded, therefore not in issue, ergo, the trial court erred
        in basing its judgment of nonsuit on such premise.
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16   Professional Hockey Corp. v. World Hockey Assn. (1983) 143 Cal.App.3d 410, 417
     (emphasis added)
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     Defs. Am. Proposed Jury Instructions   Page 11 of 12
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                                     PROOF OF SERVICE
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 3   STATE OF NEVADA, COUNTY OF CLARK

 4   I am employed in the county of Las Vegas State of Nevada. I am over the age of 18
     and not a party to the action; my business address is 300 S. Fourth Street, Suite 950
 5   Las Vegas, NV 89101.
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     On March 29, 2024, I served the foregoing document(s) described as PARAMONT
 7   DEFENDANTS’ AMENDED PROPOSED SPECIAL JURY INSTRUCTIONS as
     follows:
 8
      Collin J. Vierra (State Bar No. 322720)         Ryan van Steenis (S.B. #254542)
 9    EIMER STAHL LLP                                 1601 S Shepherd Dr., #276
      99 Almaden Blvd., Suite 641                     Houston, Texas 77019
10                                                    rjvansteenis@gmail.com
      San Jose, CA 95113-1605                         ATTORNEY FOR DEFENDANTS
11    Telephone: (408) 889-1668                       DAVID M. BRAGG AND SILICON
      Email: cvierra@eimerstahl.com                   VALLEY REAL VENTURES, LLC
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      Attorney for Plaintiffs
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14    _ _ (BY US MAIL) As follows: I am “readily familiar” with the firm’s practice of
     collection and processing correspondence for mailing. Under that practice it would be
15   deposited with the U.S. Postal Service on that same day with postage thereon fully
     prepaid at Palos Verdes Estate, CA in the ordinary cause of business. I am aware
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     that on motion of the party served, service is presumed invalid of postal cancellation
17   date 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)
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     on opposing counsel via electronic mail.
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      X (STATE) I declare under penalty of perjury under the laws of the State of
21   Nevada that the foregoing is true and correct.
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     Executed on March 29, 2024 at Las Vegas, Nevada.
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                                            /s/ Adam Miller
24                                          Adam Miller

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     Defs. Am. Proposed Jury Instructions   Page 12 of 12