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WEBB LEGAL GROUP
155 Montgomery Str:
San Francisco, CA 94104
(415) 277-7200
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WILLIAM T. WEBB #193832 ee One
JENNIFER D. SU #291603 FILE D .
155 Montgomery Street, Suite 1200 Seana ofan Francisca”
San Francisco, CA 94104 04/28/2017
(415) 277-7200 Clerk of the Court
(415) 277-7210 (fax) BEEEEE Eee
Deputy Clerk
Attorneys for BILLFLOAT, INC.,
RYAN GILBERT AND SEAN O*MALLEY
SUPERIOR COURT OF THE STATE OF CALIFORNIA
IN AND FOR THE COUNTY OF SAN FRANCISCO
(Unlimited Jurisdiction)
GOLDEN PACIFIC BANK, N.A., BILLFLOAT, INC.’S SEPARATE
STATEMENT IN SUPPORT OF ITS
Plaintiff, MOTION FOR SUMMARY
} ADJUDICATION
v. j
) Date: July 14, 2017
BILLFLOAT, INC., RYAN GILBERT, SEAN } Time: 10:00 a.m.
O’MALLEY, DOES 1-50, ) Dept: 606
Defendants. )
BILLFLOAT, INC.
Cross-Complainant,
)
v. )
GOLDEN PACIFIC BANK, N.A., and ROES )
1-50, }
)
Cross-Defendants.
BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION&
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Pursuant to California Code of Civil Procedure Section 437c, Defendant BILLFLOAT,
INC. respectfully submits this Separate Statement of Undisputed Material Facts and Genuine
Issues, together with references to supporting evidence in support to its Motion for Summary
Adjudication as follows:
BILLFLOAT’S UNDISPUTED MATERIAL FACTS
I. ISSUE ONE: Third Cause of Action for Fraud
A Golden Pacific Bank, N.A.’s (“GPB’s”) Third Cause of Action for Fraud is
barred by California’s economic loss rule.
BillFloat’s Undisputed Material Facts and
Supporting Evidence
Plaintiff's Response and Supporting
Evidence and Defendants’ Reply
1. On or about November 6, 2013, plaintiff GPB
and defendant BillFloat entered into the Software
License, Maintenance, and Support Agreement
(“License Agreement”), which licensed
BillFloat’s BELIEF System to GPB.'
BillFloat, Inc.’s Request for Judicial Notice, Att.
A, Plaintiff's Complaint, § 14 and Ex. | to
Complaint (License Agreement) (herein
“Complaint, §__.”).
2. On or about December 5, 2013, GPB and
BillFloat entered into the Joint Marketing and
Joint Technology Improvement Agreement
(“Marketing Agreement”).
Complaint, {| 16 (citing Ex. “A” of the Marketing
Agreement and § 2.1 therein) and Ex. 2 to
Complaint.
3. On or about July 24, 2014, GPB and BillFloat
entered into the First Amended Joint Marketing
and Joint Technology Improvement Agreement
(“Amended Marketing Agreement”), which
superseded and replaced the original Marketing
Agreement.
Complaint, {24 and Ex. 4 thereto.
' “BELIEF” stands for BillFloat Electronic Loan Investigation and Evaluation Framework System. Complaint, § 14
and Exibit | (Ex. A thereto).
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BillFloat’s Undisputed Material Facts and
Plaintiff's Response and Supporting
Supporting Evidence
Evidence and Defendants’ Reply
4. In the Complaint’s first cause of action for
Breach of Contract asserted solely against
BillFloat, GPB alleges that BillFloat breached the
License Agreement, the Marketing Agreement
and the Amended Marketing Agreement.
Complaint, § 38 (13:23 — 16:20).
5. In the Complaint’s second cause of action for
Breach of the Covenant of Good Faith and Fair
Dealing asserted solely against BillFloat, GPB
alleges that BillFloat breached the covenant of
good faith and fair dealing implicit in the License
Agreement, the Marketing Agreement, and the
Amended Marketing Agreement.
Complaint, ¥ 42.
6. In the Complaint’s fourth cause of action for
“Rescission based on Fraud and Failure of
Consideration” asserted solely against BillFloat,
GPB seeks to rescind all of the agreements
identified in the Complaint, including but not
limited to the License Agreement, the Marketing
Agreement, and the Amended Marketing
Agreement.
Complaint, {ff 53-55.
7. In § 12, the Complaint alleges that, during the
Parties’ 2013 negotiations, Defendants O’ Malley
and Gilbert “promised GPB that GPB and
BILLFLOAT would jointly own the intellectual
property which they would jointly develop and
finance into an online design to apply GPB’s
decision-making criteria to process more accurate,
rapid and efficient evaluation, underwriting and
marketing of SBA 7(a) Program Loans.”
Complaint, {12 at 4:12-16.
8. Ing 13, the Complaint alleges that Defendants
O'Malley and Gilbert “promised GPB that
Plaintiff would have ‘most favored nation’ status
with respect to any future small business lending
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BillFloat’s Undisputed Material Facts and
Plaintiff's Response and Supporting
Supporting Evidence
Evidence and Defendants’ Reply
products or services that BILLFLOAT would
offer.”
Complaint, {13 at 4:17-19.
9. In § 45(a) of the Complaint’s third cause of
action for “Fraud” asserted against all Defendants,
GPB alleges that Defendants O’Malley and
Gilbert, in “negotiating the terms and conditions
of” the Marketing Agreement and the Amended
Marketing Agreement, “promised GPB’s
negotiators that, by entering into” these
agreements, GPB “was not responsible for all of
BillFloat’s operating costs or even for any of
BillFloat’s operating costs unrelated to the Joint
Technology or the SmartBiz brand that marketed
the Joint Technology.”
Complaint, {45(a) at 17:26-18:5.
10. In § 45(a) of the Complaint’s third cause of
action for “Fraud” asserted against all Defendants,
GPB alleges that Defendants O’ Malley and
Gilbert “told GPB’s executives, that prior to the
commencement of work on technology
development that would improve or add to the
value of the ‘Joint IP,’ BILLFLOAT would have
to deliver a Joint IP SOW to GPB no later than 15
days before the work would commence.
Complaint, {45(a) at 18:5-9.
10.
11. In § 45(a) of the Complaint’s third cause of
action for “Fraud” asserted against all Defendants,
GPB alleges that Defendants O’Malley and
Gilbert “told GPB’s executives that BILLFLOAT
could not charge GPB for a 50 percent share of
the improvement costs of their Joint IP
Improvement Expenses to which GPB did not
agree.”
Complaint, §45(a) at 18:9-12.
12. In § 45(c) of the Complaint’s third cause of
action for “Fraud” asserted against all Defendants,
GPB alleges that, in negotiating the Marketing
Agreement and the Amended Marketing
Agreement, Defendants O’Malley and Gilbert
“promised GPB’s negotiators that (sic) would
12.
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BillFloat’s Undisputed Material Facts and
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Supporting Evidence
Evidence and Defendants’ Reply
make referrals of ‘qualified’ businesses seeking an
SBA loan of $25,000 or less and from future
lending products and services that BILLFLOAT
would offer through GPB under the proposed
“most favored nation’ status.”
Complaint, §45(c) at 19:1-6.
13. In § 45(d) of the Complaint’s third cause of
action for “Fraud” asserted against all Defendants,
GPB alleges that, in negotiating the Marketing
Agreement and the Amended Marketing
Agreement, Defendants “promised GPB’s
negotiators that (sic) would deliver accurate
reports for the volume of referrals to, and fee
income from other lending banks to GPB.”
Complaint, §45(d) at 19:9-13.
13.
14. In § 45(b) of the Complaint’s third cause of
action for “Fraud” asserted against all Defendants,
GPB alleges that, after execution of the Marketing
Agreement and the Amended Marketing
Agreement, Defendants O’Malley and Gilbert
“caused to be delivered BillFloat’s Joint IP SOWs
to GPB that over-billed GPB for BillFloat’s
operating costs unrelated to the Joint Technology
or the SmartBiz brand that marketed the Joint
Technology.”
Complaint, {45(b) at 18:20-25.
14,
15. In { 29, the Complaint alleges that Defendants
O’Malley and Gilbert “purposely concealed
BillFloat’s license agreements and loan referrals
to other lenders from GPB in direct meetings with
Plaintiff's (GPB’s) executives, including Ms.
Varela and board members, ...”
Complaint, (29 at 11:7-13.
15,
I. ISSUE TWO: Third Cause of Action for Fraud
A. Golden Pacific Bank, N.A.’s (*“GPB’s”) Third Cause of Action for Fraud has
no merit because Plaintiff has no evidence of any misrepresentation made by
Mr. O’Malley.
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BillFloat’s Undisputed Material Facts and
Plaintiff's Response and Supporting
Supporting Evidence
Evidence and Defendants’ Reply
16. Contrary to the allegation in § 12 of the
Complaint, during the Parties’ 2013 negotiations,
Mr. O’Malley did not promise GPB that “GPB
and BILLFLOAT would jointly own the
intellectual property which they would jointly
develop and finance into an online design to apply
GPB’s decision-making criteria to process more
accurate, rapid and efficient evaluation,
underwriting and marketing of SBA 7(a) Program
Loans.”
O'Malley Decl., {| 12-13 at 3:23-5:2.
16.
17. Contrary to the allegation in J 13 of the
Complaint, Mr. O’Malley did not promise GPB
that “Plaintiff would have ‘most favored nation’
status with respect to any future small business
lending products or services that BILLFLOAT
would offer.”
O'Malley Decl., {412 & 14 (at 5:3-10).
17.
18. Contrary to the allegation in § 45(a) of the
Complaint, in “negotiating the terms and
conditions of” the Marketing Agreement and the
Amended Marketing Agreement, Mr. O’Malley
did not promise GPB’s negotiators that, by
entering into these agreements, GPB “was not
responsible for all of BillFloat’s operating costs or
even for any of BillFloat’s operating costs
unrelated to the Joint Technology or the SmartBiz
brand that marketed the Joint Technology.”
O’Malley Decl., $f 12 & 15 (at 5:11-18).
18.
19. Contrary to the allegation in § 45(a) of the
Complaint, Mr. O’ Malley did not promise GPB’s
executives, that prior to the commencement of
work on technology development that would
improve or add to the value of the “Joint IP”,
BILLFLOAT would have to deliver a Joint IP
SOW to GPB no later than 15 days before the
work would commence.
O'Malley Decl., {4 12 & 16 (at 5:19-6:1).
20. Contrary to the allegation in § 45(a) of the
Complaint, Mr. O’Malley did not promise GPB’s
executives that “BILLFLOAT could not charge
20.
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GPB for a 50 percent share of the improvement
costs of their Joint IP Improvement Expenses to
which GPB did not agree.”
O'Malley Decl., {§ 12 & 17 (at 6:2-12).
21. Contrary to the allegation in § 45(c) of the
Complaint, in negotiating the Marketing
Agreement and the Amended Marketing
Agreement, Mr. O’Malley did not promise
“GPB’s negotiators that (sic) would make
referrals of ‘qualified’ businesses seeking an SBA
loan of $25,000 or less and from future lending
products and services that BILLFLOAT would
offer through GPB under the proposed ‘most
favored nation’ status.”
O'Malley Decl., {12 & 18 (at 6:13-24).
22. Contrary to the allegation in J 45(d) of the
Complaint, in negotiating the Marketing
Agreement and the Amended Marketing
Agreement, Mr. O’Malley did not promise
“GPB’s negotiators that (sic) would deliver
accurate reports for the volume of referrals to, and
fee income from other lending banks to GPB.”
O’Malley Decl., $12 & 19 (at 6:25-7:4).
22.
23. Contrary to the allegation in § 45(b) of the
Complaint, after execution of the Marketing
Agreement and the Amended Marketing
Agreement, Mr. O’Malley did not cause to be
delivered “BillFloat’s Joint IP SOWs to GPB that
over-billed GPB for BillFloat’s operating costs
unrelated to the Joint Technology or the SmartBiz
brand that marketed the Joint Technology.”
Q’Malley Decl., $12 & 20 (at 7:5-11).
23.
24. Contrary to the allegation in § 29 of the
Complaint, Mr. O’Malley did not “conceal
BillFloat’s license agreements and loan referrals
to other lenders from GPB in direct meetings with
Plaintiff's (GPB’s) executives, including Ms.
Varela and board members, ...”
O’Malley Decl., {| 12 & 29 (at 7:12-15).
24,
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Til. _ ISSUE THREE: Third Cause of Action for Fraud
A. Golden Pacific Bank, N.A.’s (“GPB’s”) Third Cause of Action for Fraud has
no merit because Plaintiff has no evidence of any misrepresentation made by
Mr. Gilbert.
BillFloat’s Undisputed Material Facts and
Plaintiff's Response and Supporting
Supporting Evidence
Evidence and Defendants’ Reply
25. Contrary to the allegation in § 12 of the
Complaint, during the Parties’ 2013 negotiations,
Mr. Gilbert did not promise GPB that “GPB and
BILLFLOAT would jointly own the intellectual
property which they would jointly develop and
finance into an online design to apply GPB’s
decision-making criteria to process more accurate,
rapid and efficient evaluation, underwriting and
marketing of SBA 7(a) Program Loans.”
Gilbert Decl., §¥f 3-4 at 1:11-2:17.
25.
26. Contrary to the allegation in J 13 of the
Complaint, Mr. Gilbert did not promise GPB that
“Plaintiff would have ‘most favored nation’ status
with respect to any future small business lending
products or services that BILLFLOAT would
offer.”
Gilbert Decl., {3 and 5.
26.
27. Contrary to the allegation in 4 45(a) of the
Complaint, in “negotiating the terms and
conditions of” the Marketing Agreement and the
Amended Marketing Agreement, Mr. Gilbert did
not promise GPB’s negotiators that, by entering
into these agreements, GPB “was not responsible
for all of BillFloat’s operating costs or even for
any of BillFloat’s operating costs unrelated to the
Joint Technology or the SmartBiz brand that
marketed the Joint Technology.”
Gilbert Decl., (| 3 and 6.
28. Contrary to the allegation in § 45(a) of the
Complaint, Mr. Gilbert did not promise GPB’s
executives, that prior to the commencement of
work on technology development that would
improve or add to the value of the “Joint IP”,
BILLFLOAT would have to deliver a Joint IP
SOW to GPB no later than 15 days before the
work would commence.
28.
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Evidence and Defendants’ Reply
Gilbert Decl., {| 3 and 7.
29. Contrary to the allegation in § 45(a) of the
Complaint, Mr. Gilbert did not promise GPB’s
executives that “BILLFLOAT could not charge
GPB for a 50 percent share of the improvement
costs of their Joint IP Improvement Expenses to
which GPB did not agree.”
Gilbert Decl., {3 and 8.
29.
30. Contrary to the allegation in | 45(c) of the
Complaint, in negotiating the Marketing
Agreement and the Amended Marketing
Agreement, Mr. Gilbert did not promise “GPB’s
negotiators that (sic) would make referrals of
‘qualified’ businesses seeking an SBA loan of
$25,000 or less and from future lending products
and services that BILLFLOAT would offer
through GPB under the proposed ‘most favored
nation’ status.”
Gilbert Decl., {3 and 9.
30.
31. Contrary to the allegation in J 45(d) of the
Complaint, in negotiating the Marketing
Agreement and the Amended Marketing
Agreement, Mr. Gilbert did not promise “GPB’s
negotiators that (sic) would deliver accurate
reports for the volume of referrals to, and fee
income from other lending banks to GPB.”
Gilbert Decl., 9] 3 and 10.
31.
32. Contrary to the allegation in {/ 45(b) of the
Complaint, after execution of the Marketing
Agreement and the Amended Marketing
Agreement, Mr. Gilbert did not cause to be
delivered “BillFloat’s Joint IP SOWs to GPB that
over-billed GPB for BillFloat’s operating costs
unrelated to the Joint Technology or the SmartBiz
brand that marketed the Joint Technology.”
Gilbert Decl., [3 and 11.
32.
33. Contrary to the allegation in 29 of the
Complaint, Mr. Gilbert did not “conceal
BillFloat’s license agreements and loan referrals
to other lenders from GPB in direct meetings with
33.
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Plaintiff's (GPB’s) executives, including Ms.
Varela and board members, ...”
Gilbert Decl., {| 3 and 12.
IV. _ ISSUE FOUR: Third Cause of Action for Fraud
A Golden Pacific Bank, N.A.’s (“GPB’s”) Third Cause of Action for Fraud has
no merit because Plaintiff cannot establish the required element of
“knowledge of falsity.”
BillFloat’s Undisputed Material Facts and
Supporting Evidence
Plaintiff's Response and Supporting
Evidence and Defendants’ Reply
34. Pursuant to § 2.1 of the Marketing Agreement
and the Amended Marketing Agreement, GPB and
BillFloat jointly own the Joint Technology.
Ex. 1, Amended Marketing Agreement (§ 2.1 &
Ex. A thereto); Ex. 2, original Marketing
Agreement (§ 2.1 & Ex. A thereto); O’Malley
Decl., 4] 8-11; Singer Decl., f] 3-6, 25-26.
34.
35. Pursuant to § 3 (“Preferred Relationships”) in
the Marketing Agreement and the Amended
Marketing Agreement, GPB and BillFloat each
granted the other “Most Favored Nation” Status
“with respect to any future small business lending
products or services ...”, as specified in these
agreements.
Ex. 1, Amended Marketing Agreement, § 3; Ex. 2,
original Marketing Agreement, § 3; O’Malley
Decl., {{] 8-12, 14.
35.
36. Pursuant to § 4 (“Technology Development”)
of the Amended Marketing Agreement (“AMA”),
BillFloat and GPB engaged in a collaborative
process for sharing in the costs and expenses of
improving or adding to the value of the “Joint IP”
that had been developed.
Ex. 1, Amended Marketing Agreement, § 4;
Singer Decl., (6-15, 21-22 (and Exs. 3-11).
36.
37. Pursuant to § 4 of the AMA, BillFloat and
GPB had the right to send the other a “Joint IP
SOW”, which allowed the receiving party the
37.
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option to agree to pay for half of the cost of the
Joint IP SOW.
Ex. 1, Amended Marketing Agreement, § 4;
Singer Decl., [.6.
38. Pursuant to § 4 of the AMA, the Joint IP
SOW could be used by BillFloat or GPB to
provide a plan or proposal to the other party to
maintain and operate, improve, or increase the
value of or add to the Joint IP, including, but not
limited to, promoting the SmartBiz Marks and
brand and business development.
Ex. 1, Amended Marketing Agreement, § 4;
Singer Decl., 96-15, 21-22 (& Exs. 3-8, 11).
38.
39. In 2014, BillFloat periodically sent by email
to GPB’s representatives Joint IP SOWs regarding
the following: BillFloat’s budgeted costs and/or
expense reports for particular monthly or quarterly
periods, including anticipated or incurred labor
costs; planned marketing expenditures and
initiatives; and GPB’s planned or reported costs
and expenditures.
Ex. 1, Amended Marketing Agreement, § 4;
Singer Decl., {.7.
39.
40. Pursuant to the AMA, after each particular
period, BillFloat and GPB exchanged reports on
their actual expenses and costs in order to engage
in an interactive “reconciliation” that involved:
the raising of questions or issues regarding the
other Party’s expenses and costs, discussion and
vetting of such questions and issues, the
exchanges of additional documentation and.
information, extensive communications by phone
and email, and, ultimately, adjustments,
corrections or revisions to the costs and amounts.
Ex. 1, Amended Marketing Agreement, § 4;
Singer Decl., {| 6-15, 21-22 (& Exs. 3-8, 11).
40.
41. Pursuant to § 3 of the marketing agreements,
BillFloat made referrals to GPB of “Qualified
Introduced Businesses” seeking an SBA loan of
$25,000 or less.
Al.
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Supporting Evidence
Evidence and Defendants’ Reply
Ex. 1, Amended Marketing Agreement, § 3; Ex. 2,
original Marketing Agreement, § 3; O’Malley
Decl., § 18; Gilbert Decl., | 9.
42. Pursuant to § 2 of the AMA, BillFloat
delivered to GPB information and reports
regarding the volume of referrals to and fee
income from other lending banks, including but
not limited to the sharing of certain revenues
through the activities of the SmartBiz Program.
Ex. 1, Amended Marketing Agreement, § 2;
O’Malley Decl., {| 19; Gilbert Decl., { 10; Singer
Decl., (16-22 (& Exs. 9-11).
Vv. ISSUE FIVE: Third Cause of Action for Fraud
A. Golden Pacific Bank, N.A.’s (“GPB’s”) Third Cause of Action for Fraud has
no merit because Plaintiff cannot establish the required element of “intent.”
BillFloat’s Undisputed Material Facts and
Plaintiff's Response and Supporting
Supporting Evidence
Evidence and Defendants’ Reply
34. Pursuant to § 2.1 of the Marketing Agreement
and the Amended Marketing Agreement, GPB and.
BillFloat jointly own the Joint Technology.
Ex. 1, Amended Marketing Agreement (§ 2.1 &
Ex. A thereto); Ex. 2, original Marketing
Agreement (§ 2.1 & Ex. A thereto); O’Malley
Decl., {| 8-11; Singer Decl., §{ 3-6, 25-26.
35. Pursuant to § 3 (“Preferred Relationships”) in
the Marketing Agreement and the Amended
Marketing Agreement, GPB and BillFloat each
granted the other “Most Favored Nation” Status
“with respect to any future small business lending
products or services ...”, as specified in these
agreements.
Ex. 1, Amended Marketing Agreement, § 3; Ex. 2,
original Marketing Agreement, § 3; O’Malley
Decl., {9 8-12, 14.
36. Pursuant to § 4 (“Technology Development”)
of the Amended Marketing Agreement (“AMA”),
BillFloat and GPB engaged in a collaborative
process for sharing in the costs and expenses of
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improving or adding to the value of the “Joint IP”
that had been developed.
Ex. 1, Amended Marketing Agreement, § 4;
Singer Decl., {§ 6-15, 21-22 (and Exs. 3-11).
37. Pursuant to § 4 of the AMA, BillFloat and
GPB had the right to send the other a “Joint IP
SOW”, which allowed the receiving party the
option to agree to pay for half of the cost of the
Joint IP SOW.
Ex. 1, Amended Marketing Agreement, § 4;
Singer Decl., (6.
37.
38. Pursuant to § 4 of the AMA, the Joint IP
SOW could be used by BillFloat or GPB to
provide a plan or proposal to the other party to
maintain and operate, improve, or increase the
value of or add to the Joint IP, including, but not
limited to, promoting the SmartBiz Marks and
brand and business development.
Ex. 1, Amended Marketing Agreement, § 4;
Singer Decl., {| 6-15, 21-22 (& Exs. 3-8, 11).
38.
39. In 2014, BillFloat periodically sent by email
to GPB’s representatives Joint IP SOWs regarding
the following: BillFloat’s budgeted costs and/or
expense reports for particular monthly or quarterly
periods, including anticipated or incurred labor
costs; planned marketing expenditures and
initiatives; and GPB’s planned or reported costs
and expenditures.
Ex. 1, Amended Marketing Agreement, § 4;
Singer Decl., 47.
39.
40. Pursuant to the AMA, after each particular
period, BillFloat and GPB exchanged reports on
their actual expenses and costs in order to engage
in an interactive “reconciliation” that involved:
the raising of questions or issues regarding the
other Party’s expenses and costs, discussion and
vetting of such questions and issues, the
exchanges of additional documentation and
information, extensive communications by phone
and email, and, ultimately, adjustments,
corrections or revisions to the costs and amounts.
40.
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Ex. 1, Amended Marketing Agreement, § 4:
Singer Decl., {| 6-15, 21-22 (& Exs. 3-8, 11).
41. Pursuant to § 3 of the marketing agreements,
BillFloat made referrals to GPB of “Qualified
Introduced Businesses” seeking an SBA loan of
$25,000 or less.
Ex. 1, Amended Marketing Agreement, § 3; Ex. 2,
original Marketing Agreement, § 3; O’Malley
Decl., 18; Gilbert Decl., 49.
41.
42. Pursuant to § 2 of the AMA, BillFloat
delivered to GPB information and reports
regarding the volume of referrals to and fee
income from other lending banks, including but
not limited to the sharing of certain revenues
through the activities of the SmartBiz Program.
Ex. 1, Amended Marketing Agreement, § 2;
O'Malley Decl., {j 19; Gilbert Decl., § 10; Singer
Decl., §§] 16-22 (& Exs. 9-11).
42.
VI. __ ISSUE SIX: Third Cause of Action for Fraud
A. Golden Pacific Bank, N.A.’s (“GPB’s”) Third Cause of Action for Fraud has
no merit because Plaintiff cannot establish “justifiable reliance.”
BillFloat’s Undisputed Material Facts and
Plaintiff’s Response and Supporting
Supporting Evidence
Evidence and Defendants’ Reply
43. Pursuant to § 13 of the Marketing Agreement
and § 21 the Amended Marketing Agreement, the
written agreements constitutes the entire
agreement between the parties with respect to the
Joint IP and supersedes all prior and contemporary
agreements, understandings and commitments
between the parties.
Ex. 3, Amended Marketing Agreement (§ 21); Ex.
2, original Marketing Agreement (§ 13).
43.
Mit
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VU. ISSUE SEVEN: Third Cause of Action for Fraud
A. Golden Pacific Bank, N.A.’s (“GPB’s”) Third Cause of Action for Fraud has
no merit because Plaintiff has no evidence that it suffered any damages
arising from the alleged fraud.
BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting
Supporting Evidence Evidence and Defendants’ Reply
44. To support its contention in § 49 of the 44.
Complaint that it relied “on the Defendants’
misrepresentations and concealment of facts”,
GPB responded in interrogatories that it “relied on
Defendants’ financial projections and
representations in agreeing to the Joint Marketing
and Technology Improvement Agreement.”
Complaint, { 49; Ex. 14, Response to Special
Interrogatory 185 (p. 366, lines 19-21).
45, In response to Defendants’ Special 45.
Interrogatories asking for facts supporting GPB’s
allegations in § 50 of the Complaint regarding
damages for fraud, GPB has failed to provide any
facts or information supporting the incurring of
actual damages for the alleged fraud.
Complaint, {| 50; Ex. 14, Response to Special
Interrogatory 187 (p. 369:9-372:6).
VIII. ISSUE EIGHT: Fifth Cause of Action for Misappropriation of Trade Secrets
A. GPB’s Fifth Cause of Action for Misappropriation of Trade Secrets has no
merit because the matters identified by GPB do not constitute trade secrets.
BillFloat’s Undisputed Material Facts and Plaintiff’s Response and Supporting
Supporting Evidence Evidence and Defendants’ Reply
46. GPB’s cause of action for misappropriation of | 46.
trade secrets is based on GPB’s business as a
lending bank, including assessment of loan
applications, SBA lending operations, and
compliance with applicable rules and regulations.
Complaint, {| 57; Ex. X (GPB’s Trade Secret
Disclosure submitted under seal).
47. The requirements and procedures governing | 47.
the SBA 7(a) Loan Program, including but not
limited to the Program’s underwriting standards,
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BillFloat’s Undisputed Material Facts and
Plaintiff's Response and Supporting
Supporting Evidence
Evidence and Defendants’ Reply
are matters of public record.
BillFloat’s Request for Judicial Notice, Att. “C.”
Ix. ISSUE NINE: Fifth Cause of Action for Misappropriation of Trade Secrets
A GPB’s Fifth Cause of Action for Misappropriation of Trade Secrets has no
merit because Plaintiff has no evidence of misappropriation of its alleged
trade secrets by Mr. O’ Malley.
BillFloat’s Undisputed Material Facts and
Plaintiff's Response and Supporting
Supporting Evidence
Evidence and Defendants’ Reply
48. Regarding both the information of GPB that
has been provided in its Trade Secret Disclosure
and more specific information that may exist, but
is not identified in the Disclosure, Mr. O’ Malley
never used or had the opportunity to use any such
information.
O’Malley Decl., 422.
48.
49. Regarding both the information of GPB that
has been provided in its Trade Secret Disclosure
and more specific information that may exist, but
is not identified in the Disclosure, Mr. O’Malley
never disclosed any such information to a third
party lender or anyone else.
O’Malley Decl., § 22.
49,
50. To the extent a portion of GPB’s Trade Secret
Disclosure refers to GPB’s contribution to the
Joint Technology described in § 2 of the
Marketing Agreements, Mr, O’Malley never used
or had the opportunity to use that information.
O’Malley Decl., {| 22.
51. To the extent a portion of GPB’s Trade Secret
Disclosure refers to GPB’s contribution to the
Joint Technology described in § 2 of the
Marketing Agreements, Mr. O’Malley never
disclosed that information to a third party lender
or anyone else.
O’Malley Decl., 422.
52. Mr. O'Malley did not participate in the
marketing of the Joint Technology to an
52.
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BillFloat’s Undisputed Material Facts and
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prospective licensee.
O'Malley Decl., { 22.
53. Regarding the potential sublicensing of
GPB’s rights and interest in the Joint Technology,
which BillFloat was authorized to do by §2 of the
marketing agreements, no such sublicenses have
been issued.
O’Malley Decl., {| 22; Gilbert Decl., § 13; Singer
Decl., {| 23-26.
53.
xX. ISSUE TEN: Fifth Cause of Action for Misappropriation of Trade Secrets
A. GPB’s Fifth Cause of Action for Misappropriation of Trade Secrets has no
merit because Plaintiff has no evidence of misappropriation of its alleged
trade secrets by Mr. Gilbert.
BillFloat’s Undisputed Material Facts and
Plaintiff's Response and Supporting
Supporting Evidence
Evidence and Defendants’ Reply
54. Regarding the potential sublicensing of
GPB’s rights and interest in the Joint Technology,
which BillFloat was authorized to do by §2 of the
marketing agreements, no such sublicenses have
been issued.
O’Malley Decl., § 22; Gilbert Decl., § 13; Singer
Decl., {| 23-26.
54.
55. Regarding both the information of GPB that
has been provided in its Trade Secret Disclosure
and more specific information that may exist, but
is not identified in the Disclosure, Mr. Gilbert
never used or had the opportunity to use any such
information.
Gilbert Decl., 4.13.
56. Regarding both the information of GPB that
has been provided in its Trade Secret Disclosure
and more specific information that may exist, but
is not identified in the Disclosure, Mr. Gilbert
never disclosed any such information to a third
party lender or anyone else.
Gilbert Decl., 13.
56.
57. To the extent a portion of GPB’s Trade Secret
37.
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Disclosure refers to GPB’s contribution to the
Joint Technology described in § 2 of the
Marketing Agreements, Mr. Gilbert never used or
had the opportunity to use that information.
Gilbert Deel., |] 13.
58. To the extent a portion of GPB’s Trade Secret
Disclosure refers to GPB’s contribution to the
Joint Technology described in § 2 of the
Marketing Agreements, Mr. Gilbert never
disclosed that information to a third party lender
or anyone else.
Gilbert Decl., {1 13.
58.
59. Mr. Gilbert did not participate in the
marketing of the Joint Technology to any
prospective licensee.
Gilbert Decl., {|13.
59.
XI. ISSUE ELEVEN: Fifth Cause of Action for Misappropriation of Trade Secrets
A. GPB’s Fifth Cause of Action for Misappropriation of Trade Secrets has no
merit because Plaintiff has no evidence of misappropriation of its alleged
trade secrets by BillFloat, Inc.
BillFloat’s Undisputed Material Facts and
Plaintiff's Response and Supporting
Supporting Evidence
Evidence and Defendants’ Reply
53. Regarding the potential sublicensing of
GPB’s rights and interest in the Joint Technology,
which BillFloat was authorized to do by §2 of the
marketing agreements, no such sublicenses have
been issued.
O’Malley Decl., {| 22; Gilbert Decl., § 13; Singer
Decl., (23-26.
53.
60. Based on a reasonable inquiry by BillFloat,
BillFloat has not disclosed: any of the information
provided in GPB’s Trade Secret Disclosure; or
more specific information that may exist, but has
not been identified in the GPB’s Trade Secret
Disclosure.
Singer Decl., {{] 23-26.
60.
61. To the extent a portion of GPB’s Trade Secret
61.
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BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting
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Disclosure refers to GPB’s contribution to the
Joint Technology described in § 2 of the
Marketing Agreement and the Amended
Marketing Agreement, based on a reasonable
inquiry by BillFloat, no one from BillFloat made
any disclosure of that information to a third party
lender or anyone else.
Singer Decl., ff] 23-26.
XII. ISSUE TWELVE: Fifth Cause of Action for Misappropriation of Trade Secrets
A GPB’s Fifth Cause of Action for Misappropriation of Trade Secrets has no
merit because, to the extent any material claimed by GPB to be a trade secret
was shared by Defendant BillFloat, such sharing was authorized by one or
more of the agreements signed by GPB and BillFloat.
BillFloat’s Undisputed Material Facts and Plaintiff’s Response and Supporting
Supporting Evidence Evidence and Defendants’ Reply
53. Regarding the potential sublicensing of 53.
GPB’s rights and interest in the Joint Technology,
which BillFloat was authorized to do by §2 of the
marketing agreements, no such sublicenses have
been issued.
O’Malley Decl., § 22; Gilbert Decl., § 13; Singer
Decl., {| 23-26.
62. To the extent any part of the Joint Technology | 62.
was shared by BillFloat with a third party, any
such sharing was authorized by one or more
agreements signed by BillFloat and GPB.
Singer Decl., §{ 23-26.
63. Given BillFloat's duty to market the Joint 63.
Technology to potential sublicensees pursuant to
§2.3 of the marketing agreements, to the extent
any part of the Joint Technology was shared by
BillFloat with a third party in connection with that
duty, any such sharing was: 1) authorized by §
2.3 of the Marketing Agreement and the Amended
Marketing Agreement; and 2) made pursuant to a
non-disclosure agreement ("NDA") with the
potential sublicensee.
Singer Decl., (23-26.
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BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION1 XII. ISSUE THIRTEEN: Fifth Cause of Action for Misappropriation of Trade Secrets
2 A GPB’s fifth cause of action for Misappropriation of Trade Secrets has no
merit because Plaintiff has no evidence of any damages arising from alleged
3 Misappropriation of Trade Secrets.
4 BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting
5 Supporting Evidence Evidence and Defendants’ Reply
6 64. In responding to written discovery served in 64.
this action by Defendants, Plaintiff GPB has failed
7 || to identify any damages suffered as a result of the
alleged misappropriation of trade secrets.
Ex. 14, Plaintiff GPB’s Responses to Special
9 ||| Interrogatory Nos. 211 & 217 (pp. 456:17-457:17,
471:2-479:21).
11 | Date: April 27, 2017 Respectfully submitted,
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WILLIAM LYEBB #193832
14 JENNIFER D. SU #291603
Attdwéys for BILLFLOAT, INC.,
RYAN GILBERT, and SEAN
16 O’MALLEY
(415) 277-7200
155 Montgomer
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BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION
Preview
WEBB LEGAL GROUP 155 Montgomery Str: San Francisco, CA 94104 (415) 277-7200 w a WILLIAM T. WEBB #193832 ee One JENNIFER D. SU #291603 FILE D . 155 Montgomery Street, Suite 1200 Seana ofan Francisca” San Francisco, CA 94104 04/28/2017 (415) 277-7200 Clerk of the Court (415) 277-7210 (fax) BEEEEE Eee Deputy Clerk Attorneys for BILLFLOAT, INC., RYAN GILBERT AND SEAN O*MALLEY SUPERIOR COURT OF THE STATE OF CALIFORNIA IN AND FOR THE COUNTY OF SAN FRANCISCO (Unlimited Jurisdiction) GOLDEN PACIFIC BANK, N.A., BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS Plaintiff, MOTION FOR SUMMARY } ADJUDICATION v. j ) Date: July 14, 2017 BILLFLOAT, INC., RYAN GILBERT, SEAN } Time: 10:00 a.m. O’MALLEY, DOES 1-50, ) Dept: 606 Defendants. ) BILLFLOAT, INC. Cross-Complainant, ) v. ) GOLDEN PACIFIC BANK, N.A., and ROES ) 1-50, } ) Cross-Defendants. BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION& 5 ° a o a z 155 Montgomer (415) 277-7200 w a Pursuant to California Code of Civil Procedure Section 437c, Defendant BILLFLOAT, INC. respectfully submits this Separate Statement of Undisputed Material Facts and Genuine Issues, together with references to supporting evidence in support to its Motion for Summary Adjudication as follows: BILLFLOAT’S UNDISPUTED MATERIAL FACTS I. ISSUE ONE: Third Cause of Action for Fraud A Golden Pacific Bank, N.A.’s (“GPB’s”) Third Cause of Action for Fraud is barred by California’s economic loss rule. BillFloat’s Undisputed Material Facts and Supporting Evidence Plaintiff's Response and Supporting Evidence and Defendants’ Reply 1. On or about November 6, 2013, plaintiff GPB and defendant BillFloat entered into the Software License, Maintenance, and Support Agreement (“License Agreement”), which licensed BillFloat’s BELIEF System to GPB.' BillFloat, Inc.’s Request for Judicial Notice, Att. A, Plaintiff's Complaint, § 14 and Ex. | to Complaint (License Agreement) (herein “Complaint, §__.”). 2. On or about December 5, 2013, GPB and BillFloat entered into the Joint Marketing and Joint Technology Improvement Agreement (“Marketing Agreement”). Complaint, {| 16 (citing Ex. “A” of the Marketing Agreement and § 2.1 therein) and Ex. 2 to Complaint. 3. On or about July 24, 2014, GPB and BillFloat entered into the First Amended Joint Marketing and Joint Technology Improvement Agreement (“Amended Marketing Agreement”), which superseded and replaced the original Marketing Agreement. Complaint, {24 and Ex. 4 thereto. ' “BELIEF” stands for BillFloat Electronic Loan Investigation and Evaluation Framework System. Complaint, § 14 and Exibit | (Ex. A thereto). 1 BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION& 5 ° 2 o a z 155 Montgomer (415) 277-7200 w a BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting Supporting Evidence Evidence and Defendants’ Reply 4. In the Complaint’s first cause of action for Breach of Contract asserted solely against BillFloat, GPB alleges that BillFloat breached the License Agreement, the Marketing Agreement and the Amended Marketing Agreement. Complaint, § 38 (13:23 — 16:20). 5. In the Complaint’s second cause of action for Breach of the Covenant of Good Faith and Fair Dealing asserted solely against BillFloat, GPB alleges that BillFloat breached the covenant of good faith and fair dealing implicit in the License Agreement, the Marketing Agreement, and the Amended Marketing Agreement. Complaint, ¥ 42. 6. In the Complaint’s fourth cause of action for “Rescission based on Fraud and Failure of Consideration” asserted solely against BillFloat, GPB seeks to rescind all of the agreements identified in the Complaint, including but not limited to the License Agreement, the Marketing Agreement, and the Amended Marketing Agreement. Complaint, {ff 53-55. 7. In § 12, the Complaint alleges that, during the Parties’ 2013 negotiations, Defendants O’ Malley and Gilbert “promised GPB that GPB and BILLFLOAT would jointly own the intellectual property which they would jointly develop and finance into an online design to apply GPB’s decision-making criteria to process more accurate, rapid and efficient evaluation, underwriting and marketing of SBA 7(a) Program Loans.” Complaint, {12 at 4:12-16. 8. Ing 13, the Complaint alleges that Defendants O'Malley and Gilbert “promised GPB that Plaintiff would have ‘most favored nation’ status with respect to any future small business lending 2 BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION& 5 ° 2 o a z 155 Montgomer (415) 277-7200 w a BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting Supporting Evidence Evidence and Defendants’ Reply products or services that BILLFLOAT would offer.” Complaint, {13 at 4:17-19. 9. In § 45(a) of the Complaint’s third cause of action for “Fraud” asserted against all Defendants, GPB alleges that Defendants O’Malley and Gilbert, in “negotiating the terms and conditions of” the Marketing Agreement and the Amended Marketing Agreement, “promised GPB’s negotiators that, by entering into” these agreements, GPB “was not responsible for all of BillFloat’s operating costs or even for any of BillFloat’s operating costs unrelated to the Joint Technology or the SmartBiz brand that marketed the Joint Technology.” Complaint, {45(a) at 17:26-18:5. 10. In § 45(a) of the Complaint’s third cause of action for “Fraud” asserted against all Defendants, GPB alleges that Defendants O’ Malley and Gilbert “told GPB’s executives, that prior to the commencement of work on technology development that would improve or add to the value of the ‘Joint IP,’ BILLFLOAT would have to deliver a Joint IP SOW to GPB no later than 15 days before the work would commence. Complaint, {45(a) at 18:5-9. 10. 11. In § 45(a) of the Complaint’s third cause of action for “Fraud” asserted against all Defendants, GPB alleges that Defendants O’Malley and Gilbert “told GPB’s executives that BILLFLOAT could not charge GPB for a 50 percent share of the improvement costs of their Joint IP Improvement Expenses to which GPB did not agree.” Complaint, §45(a) at 18:9-12. 12. In § 45(c) of the Complaint’s third cause of action for “Fraud” asserted against all Defendants, GPB alleges that, in negotiating the Marketing Agreement and the Amended Marketing Agreement, Defendants O’Malley and Gilbert “promised GPB’s negotiators that (sic) would 12. 3 BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION& 5 ° 2 o a z 155 Montgomer (415) 277-7200 w a BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting Supporting Evidence Evidence and Defendants’ Reply make referrals of ‘qualified’ businesses seeking an SBA loan of $25,000 or less and from future lending products and services that BILLFLOAT would offer through GPB under the proposed “most favored nation’ status.” Complaint, §45(c) at 19:1-6. 13. In § 45(d) of the Complaint’s third cause of action for “Fraud” asserted against all Defendants, GPB alleges that, in negotiating the Marketing Agreement and the Amended Marketing Agreement, Defendants “promised GPB’s negotiators that (sic) would deliver accurate reports for the volume of referrals to, and fee income from other lending banks to GPB.” Complaint, §45(d) at 19:9-13. 13. 14. In § 45(b) of the Complaint’s third cause of action for “Fraud” asserted against all Defendants, GPB alleges that, after execution of the Marketing Agreement and the Amended Marketing Agreement, Defendants O’Malley and Gilbert “caused to be delivered BillFloat’s Joint IP SOWs to GPB that over-billed GPB for BillFloat’s operating costs unrelated to the Joint Technology or the SmartBiz brand that marketed the Joint Technology.” Complaint, {45(b) at 18:20-25. 14, 15. In { 29, the Complaint alleges that Defendants O’Malley and Gilbert “purposely concealed BillFloat’s license agreements and loan referrals to other lenders from GPB in direct meetings with Plaintiff's (GPB’s) executives, including Ms. Varela and board members, ...” Complaint, (29 at 11:7-13. 15, I. ISSUE TWO: Third Cause of Action for Fraud A. Golden Pacific Bank, N.A.’s (*“GPB’s”) Third Cause of Action for Fraud has no merit because Plaintiff has no evidence of any misrepresentation made by Mr. O’Malley. 4 BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION& 5 ° 2 o a z 155 Montgomer (415) 277-7200 w a BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting Supporting Evidence Evidence and Defendants’ Reply 16. Contrary to the allegation in § 12 of the Complaint, during the Parties’ 2013 negotiations, Mr. O’Malley did not promise GPB that “GPB and BILLFLOAT would jointly own the intellectual property which they would jointly develop and finance into an online design to apply GPB’s decision-making criteria to process more accurate, rapid and efficient evaluation, underwriting and marketing of SBA 7(a) Program Loans.” O'Malley Decl., {| 12-13 at 3:23-5:2. 16. 17. Contrary to the allegation in J 13 of the Complaint, Mr. O’Malley did not promise GPB that “Plaintiff would have ‘most favored nation’ status with respect to any future small business lending products or services that BILLFLOAT would offer.” O'Malley Decl., {412 & 14 (at 5:3-10). 17. 18. Contrary to the allegation in § 45(a) of the Complaint, in “negotiating the terms and conditions of” the Marketing Agreement and the Amended Marketing Agreement, Mr. O’Malley did not promise GPB’s negotiators that, by entering into these agreements, GPB “was not responsible for all of BillFloat’s operating costs or even for any of BillFloat’s operating costs unrelated to the Joint Technology or the SmartBiz brand that marketed the Joint Technology.” O’Malley Decl., $f 12 & 15 (at 5:11-18). 18. 19. Contrary to the allegation in § 45(a) of the Complaint, Mr. O’ Malley did not promise GPB’s executives, that prior to the commencement of work on technology development that would improve or add to the value of the “Joint IP”, BILLFLOAT would have to deliver a Joint IP SOW to GPB no later than 15 days before the work would commence. O'Malley Decl., {4 12 & 16 (at 5:19-6:1). 20. Contrary to the allegation in § 45(a) of the Complaint, Mr. O’Malley did not promise GPB’s executives that “BILLFLOAT could not charge 20. 5 BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION& 5 ° 2 o a z 155 Montgomer (415) 277-7200 w a BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting Supporting Evidence Evidence and Defendants’ Reply GPB for a 50 percent share of the improvement costs of their Joint IP Improvement Expenses to which GPB did not agree.” O'Malley Decl., {§ 12 & 17 (at 6:2-12). 21. Contrary to the allegation in § 45(c) of the Complaint, in negotiating the Marketing Agreement and the Amended Marketing Agreement, Mr. O’Malley did not promise “GPB’s negotiators that (sic) would make referrals of ‘qualified’ businesses seeking an SBA loan of $25,000 or less and from future lending products and services that BILLFLOAT would offer through GPB under the proposed ‘most favored nation’ status.” O'Malley Decl., {12 & 18 (at 6:13-24). 22. Contrary to the allegation in J 45(d) of the Complaint, in negotiating the Marketing Agreement and the Amended Marketing Agreement, Mr. O’Malley did not promise “GPB’s negotiators that (sic) would deliver accurate reports for the volume of referrals to, and fee income from other lending banks to GPB.” O’Malley Decl., $12 & 19 (at 6:25-7:4). 22. 23. Contrary to the allegation in § 45(b) of the Complaint, after execution of the Marketing Agreement and the Amended Marketing Agreement, Mr. O’Malley did not cause to be delivered “BillFloat’s Joint IP SOWs to GPB that over-billed GPB for BillFloat’s operating costs unrelated to the Joint Technology or the SmartBiz brand that marketed the Joint Technology.” Q’Malley Decl., $12 & 20 (at 7:5-11). 23. 24. Contrary to the allegation in § 29 of the Complaint, Mr. O’Malley did not “conceal BillFloat’s license agreements and loan referrals to other lenders from GPB in direct meetings with Plaintiff's (GPB’s) executives, including Ms. Varela and board members, ...” O’Malley Decl., {| 12 & 29 (at 7:12-15). 24, 6 BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION& 5 ° a o a z 155 Montgomer (415) 277-7200 w a Til. _ ISSUE THREE: Third Cause of Action for Fraud A. Golden Pacific Bank, N.A.’s (“GPB’s”) Third Cause of Action for Fraud has no merit because Plaintiff has no evidence of any misrepresentation made by Mr. Gilbert. BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting Supporting Evidence Evidence and Defendants’ Reply 25. Contrary to the allegation in § 12 of the Complaint, during the Parties’ 2013 negotiations, Mr. Gilbert did not promise GPB that “GPB and BILLFLOAT would jointly own the intellectual property which they would jointly develop and finance into an online design to apply GPB’s decision-making criteria to process more accurate, rapid and efficient evaluation, underwriting and marketing of SBA 7(a) Program Loans.” Gilbert Decl., §¥f 3-4 at 1:11-2:17. 25. 26. Contrary to the allegation in J 13 of the Complaint, Mr. Gilbert did not promise GPB that “Plaintiff would have ‘most favored nation’ status with respect to any future small business lending products or services that BILLFLOAT would offer.” Gilbert Decl., {3 and 5. 26. 27. Contrary to the allegation in 4 45(a) of the Complaint, in “negotiating the terms and conditions of” the Marketing Agreement and the Amended Marketing Agreement, Mr. Gilbert did not promise GPB’s negotiators that, by entering into these agreements, GPB “was not responsible for all of BillFloat’s operating costs or even for any of BillFloat’s operating costs unrelated to the Joint Technology or the SmartBiz brand that marketed the Joint Technology.” Gilbert Decl., (| 3 and 6. 28. Contrary to the allegation in § 45(a) of the Complaint, Mr. Gilbert did not promise GPB’s executives, that prior to the commencement of work on technology development that would improve or add to the value of the “Joint IP”, BILLFLOAT would have to deliver a Joint IP SOW to GPB no later than 15 days before the work would commence. 28. 7 BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION& 5 ° 2 o a z 155 Montgomer (415) 277-7200 w a BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting Supporting Evidence Evidence and Defendants’ Reply Gilbert Decl., {| 3 and 7. 29. Contrary to the allegation in § 45(a) of the Complaint, Mr. Gilbert did not promise GPB’s executives that “BILLFLOAT could not charge GPB for a 50 percent share of the improvement costs of their Joint IP Improvement Expenses to which GPB did not agree.” Gilbert Decl., {3 and 8. 29. 30. Contrary to the allegation in | 45(c) of the Complaint, in negotiating the Marketing Agreement and the Amended Marketing Agreement, Mr. Gilbert did not promise “GPB’s negotiators that (sic) would make referrals of ‘qualified’ businesses seeking an SBA loan of $25,000 or less and from future lending products and services that BILLFLOAT would offer through GPB under the proposed ‘most favored nation’ status.” Gilbert Decl., {3 and 9. 30. 31. Contrary to the allegation in J 45(d) of the Complaint, in negotiating the Marketing Agreement and the Amended Marketing Agreement, Mr. Gilbert did not promise “GPB’s negotiators that (sic) would deliver accurate reports for the volume of referrals to, and fee income from other lending banks to GPB.” Gilbert Decl., 9] 3 and 10. 31. 32. Contrary to the allegation in {/ 45(b) of the Complaint, after execution of the Marketing Agreement and the Amended Marketing Agreement, Mr. Gilbert did not cause to be delivered “BillFloat’s Joint IP SOWs to GPB that over-billed GPB for BillFloat’s operating costs unrelated to the Joint Technology or the SmartBiz brand that marketed the Joint Technology.” Gilbert Decl., [3 and 11. 32. 33. Contrary to the allegation in 29 of the Complaint, Mr. Gilbert did not “conceal BillFloat’s license agreements and loan referrals to other lenders from GPB in direct meetings with 33. 8 BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION& 5 ° 2 o a z 155 Montgomer (415) 277-7200 w a BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting Supporting Evidence Evidence and Defendants’ Reply Plaintiff's (GPB’s) executives, including Ms. Varela and board members, ...” Gilbert Decl., {| 3 and 12. IV. _ ISSUE FOUR: Third Cause of Action for Fraud A Golden Pacific Bank, N.A.’s (“GPB’s”) Third Cause of Action for Fraud has no merit because Plaintiff cannot establish the required element of “knowledge of falsity.” BillFloat’s Undisputed Material Facts and Supporting Evidence Plaintiff's Response and Supporting Evidence and Defendants’ Reply 34. Pursuant to § 2.1 of the Marketing Agreement and the Amended Marketing Agreement, GPB and BillFloat jointly own the Joint Technology. Ex. 1, Amended Marketing Agreement (§ 2.1 & Ex. A thereto); Ex. 2, original Marketing Agreement (§ 2.1 & Ex. A thereto); O’Malley Decl., 4] 8-11; Singer Decl., f] 3-6, 25-26. 34. 35. Pursuant to § 3 (“Preferred Relationships”) in the Marketing Agreement and the Amended Marketing Agreement, GPB and BillFloat each granted the other “Most Favored Nation” Status “with respect to any future small business lending products or services ...”, as specified in these agreements. Ex. 1, Amended Marketing Agreement, § 3; Ex. 2, original Marketing Agreement, § 3; O’Malley Decl., {{] 8-12, 14. 35. 36. Pursuant to § 4 (“Technology Development”) of the Amended Marketing Agreement (“AMA”), BillFloat and GPB engaged in a collaborative process for sharing in the costs and expenses of improving or adding to the value of the “Joint IP” that had been developed. Ex. 1, Amended Marketing Agreement, § 4; Singer Decl., (6-15, 21-22 (and Exs. 3-11). 36. 37. Pursuant to § 4 of the AMA, BillFloat and GPB had the right to send the other a “Joint IP SOW”, which allowed the receiving party the 37. 9 BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION& 5 ° 2 o a z 155 Montgomer (415) 277-7200 w a BillFloat’s Undisputed Material Facts and Plaintiff’s Response and Supporting Supporting Evidence Evidence and Defendants’ Reply option to agree to pay for half of the cost of the Joint IP SOW. Ex. 1, Amended Marketing Agreement, § 4; Singer Decl., [.6. 38. Pursuant to § 4 of the AMA, the Joint IP SOW could be used by BillFloat or GPB to provide a plan or proposal to the other party to maintain and operate, improve, or increase the value of or add to the Joint IP, including, but not limited to, promoting the SmartBiz Marks and brand and business development. Ex. 1, Amended Marketing Agreement, § 4; Singer Decl., 96-15, 21-22 (& Exs. 3-8, 11). 38. 39. In 2014, BillFloat periodically sent by email to GPB’s representatives Joint IP SOWs regarding the following: BillFloat’s budgeted costs and/or expense reports for particular monthly or quarterly periods, including anticipated or incurred labor costs; planned marketing expenditures and initiatives; and GPB’s planned or reported costs and expenditures. Ex. 1, Amended Marketing Agreement, § 4; Singer Decl., {.7. 39. 40. Pursuant to the AMA, after each particular period, BillFloat and GPB exchanged reports on their actual expenses and costs in order to engage in an interactive “reconciliation” that involved: the raising of questions or issues regarding the other Party’s expenses and costs, discussion and vetting of such questions and issues, the exchanges of additional documentation and. information, extensive communications by phone and email, and, ultimately, adjustments, corrections or revisions to the costs and amounts. Ex. 1, Amended Marketing Agreement, § 4; Singer Decl., {| 6-15, 21-22 (& Exs. 3-8, 11). 40. 41. Pursuant to § 3 of the marketing agreements, BillFloat made referrals to GPB of “Qualified Introduced Businesses” seeking an SBA loan of $25,000 or less. Al. 10 BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION& 5 ° 2 o a z 155 Montgomer (415) 277-7200 w a BillFloat’s Undisputed Material Facts and Plaintiff’s Response and Supporting Supporting Evidence Evidence and Defendants’ Reply Ex. 1, Amended Marketing Agreement, § 3; Ex. 2, original Marketing Agreement, § 3; O’Malley Decl., § 18; Gilbert Decl., | 9. 42. Pursuant to § 2 of the AMA, BillFloat delivered to GPB information and reports regarding the volume of referrals to and fee income from other lending banks, including but not limited to the sharing of certain revenues through the activities of the SmartBiz Program. Ex. 1, Amended Marketing Agreement, § 2; O’Malley Decl., {| 19; Gilbert Decl., { 10; Singer Decl., (16-22 (& Exs. 9-11). Vv. ISSUE FIVE: Third Cause of Action for Fraud A. Golden Pacific Bank, N.A.’s (“GPB’s”) Third Cause of Action for Fraud has no merit because Plaintiff cannot establish the required element of “intent.” BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting Supporting Evidence Evidence and Defendants’ Reply 34. Pursuant to § 2.1 of the Marketing Agreement and the Amended Marketing Agreement, GPB and. BillFloat jointly own the Joint Technology. Ex. 1, Amended Marketing Agreement (§ 2.1 & Ex. A thereto); Ex. 2, original Marketing Agreement (§ 2.1 & Ex. A thereto); O’Malley Decl., {| 8-11; Singer Decl., §{ 3-6, 25-26. 35. Pursuant to § 3 (“Preferred Relationships”) in the Marketing Agreement and the Amended Marketing Agreement, GPB and BillFloat each granted the other “Most Favored Nation” Status “with respect to any future small business lending products or services ...”, as specified in these agreements. Ex. 1, Amended Marketing Agreement, § 3; Ex. 2, original Marketing Agreement, § 3; O’Malley Decl., {9 8-12, 14. 36. Pursuant to § 4 (“Technology Development”) of the Amended Marketing Agreement (“AMA”), BillFloat and GPB engaged in a collaborative process for sharing in the costs and expenses of 1 BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION& 5 ° 2 o a z 155 Montgomer (415) 277-7200 w a BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting Supporting Evidence Evidence and Defendants’ Reply improving or adding to the value of the “Joint IP” that had been developed. Ex. 1, Amended Marketing Agreement, § 4; Singer Decl., {§ 6-15, 21-22 (and Exs. 3-11). 37. Pursuant to § 4 of the AMA, BillFloat and GPB had the right to send the other a “Joint IP SOW”, which allowed the receiving party the option to agree to pay for half of the cost of the Joint IP SOW. Ex. 1, Amended Marketing Agreement, § 4; Singer Decl., (6. 37. 38. Pursuant to § 4 of the AMA, the Joint IP SOW could be used by BillFloat or GPB to provide a plan or proposal to the other party to maintain and operate, improve, or increase the value of or add to the Joint IP, including, but not limited to, promoting the SmartBiz Marks and brand and business development. Ex. 1, Amended Marketing Agreement, § 4; Singer Decl., {| 6-15, 21-22 (& Exs. 3-8, 11). 38. 39. In 2014, BillFloat periodically sent by email to GPB’s representatives Joint IP SOWs regarding the following: BillFloat’s budgeted costs and/or expense reports for particular monthly or quarterly periods, including anticipated or incurred labor costs; planned marketing expenditures and initiatives; and GPB’s planned or reported costs and expenditures. Ex. 1, Amended Marketing Agreement, § 4; Singer Decl., 47. 39. 40. Pursuant to the AMA, after each particular period, BillFloat and GPB exchanged reports on their actual expenses and costs in order to engage in an interactive “reconciliation” that involved: the raising of questions or issues regarding the other Party’s expenses and costs, discussion and vetting of such questions and issues, the exchanges of additional documentation and information, extensive communications by phone and email, and, ultimately, adjustments, corrections or revisions to the costs and amounts. 40. 12 BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION& 5 ° 2 o a z 155 Montgomer (415) 277-7200 w a BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting Supporting Evidence Evidence and Defendants’ Reply Ex. 1, Amended Marketing Agreement, § 4: Singer Decl., {| 6-15, 21-22 (& Exs. 3-8, 11). 41. Pursuant to § 3 of the marketing agreements, BillFloat made referrals to GPB of “Qualified Introduced Businesses” seeking an SBA loan of $25,000 or less. Ex. 1, Amended Marketing Agreement, § 3; Ex. 2, original Marketing Agreement, § 3; O’Malley Decl., 18; Gilbert Decl., 49. 41. 42. Pursuant to § 2 of the AMA, BillFloat delivered to GPB information and reports regarding the volume of referrals to and fee income from other lending banks, including but not limited to the sharing of certain revenues through the activities of the SmartBiz Program. Ex. 1, Amended Marketing Agreement, § 2; O'Malley Decl., {j 19; Gilbert Decl., § 10; Singer Decl., §§] 16-22 (& Exs. 9-11). 42. VI. __ ISSUE SIX: Third Cause of Action for Fraud A. Golden Pacific Bank, N.A.’s (“GPB’s”) Third Cause of Action for Fraud has no merit because Plaintiff cannot establish “justifiable reliance.” BillFloat’s Undisputed Material Facts and Plaintiff’s Response and Supporting Supporting Evidence Evidence and Defendants’ Reply 43. Pursuant to § 13 of the Marketing Agreement and § 21 the Amended Marketing Agreement, the written agreements constitutes the entire agreement between the parties with respect to the Joint IP and supersedes all prior and contemporary agreements, understandings and commitments between the parties. Ex. 3, Amended Marketing Agreement (§ 21); Ex. 2, original Marketing Agreement (§ 13). 43. Mit Mt 13 BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION& 5 ° a o a z 155 Montgomer (415) 277-7200 w a VU. ISSUE SEVEN: Third Cause of Action for Fraud A. Golden Pacific Bank, N.A.’s (“GPB’s”) Third Cause of Action for Fraud has no merit because Plaintiff has no evidence that it suffered any damages arising from the alleged fraud. BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting Supporting Evidence Evidence and Defendants’ Reply 44. To support its contention in § 49 of the 44. Complaint that it relied “on the Defendants’ misrepresentations and concealment of facts”, GPB responded in interrogatories that it “relied on Defendants’ financial projections and representations in agreeing to the Joint Marketing and Technology Improvement Agreement.” Complaint, { 49; Ex. 14, Response to Special Interrogatory 185 (p. 366, lines 19-21). 45, In response to Defendants’ Special 45. Interrogatories asking for facts supporting GPB’s allegations in § 50 of the Complaint regarding damages for fraud, GPB has failed to provide any facts or information supporting the incurring of actual damages for the alleged fraud. Complaint, {| 50; Ex. 14, Response to Special Interrogatory 187 (p. 369:9-372:6). VIII. ISSUE EIGHT: Fifth Cause of Action for Misappropriation of Trade Secrets A. GPB’s Fifth Cause of Action for Misappropriation of Trade Secrets has no merit because the matters identified by GPB do not constitute trade secrets. BillFloat’s Undisputed Material Facts and Plaintiff’s Response and Supporting Supporting Evidence Evidence and Defendants’ Reply 46. GPB’s cause of action for misappropriation of | 46. trade secrets is based on GPB’s business as a lending bank, including assessment of loan applications, SBA lending operations, and compliance with applicable rules and regulations. Complaint, {| 57; Ex. X (GPB’s Trade Secret Disclosure submitted under seal). 47. The requirements and procedures governing | 47. the SBA 7(a) Loan Program, including but not limited to the Program’s underwriting standards, 14 BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION& 5 ° 2 o a z 155 Montgomer (415) 277-7200 w a BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting Supporting Evidence Evidence and Defendants’ Reply are matters of public record. BillFloat’s Request for Judicial Notice, Att. “C.” Ix. ISSUE NINE: Fifth Cause of Action for Misappropriation of Trade Secrets A GPB’s Fifth Cause of Action for Misappropriation of Trade Secrets has no merit because Plaintiff has no evidence of misappropriation of its alleged trade secrets by Mr. O’ Malley. BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting Supporting Evidence Evidence and Defendants’ Reply 48. Regarding both the information of GPB that has been provided in its Trade Secret Disclosure and more specific information that may exist, but is not identified in the Disclosure, Mr. O’ Malley never used or had the opportunity to use any such information. O’Malley Decl., 422. 48. 49. Regarding both the information of GPB that has been provided in its Trade Secret Disclosure and more specific information that may exist, but is not identified in the Disclosure, Mr. O’Malley never disclosed any such information to a third party lender or anyone else. O’Malley Decl., § 22. 49, 50. To the extent a portion of GPB’s Trade Secret Disclosure refers to GPB’s contribution to the Joint Technology described in § 2 of the Marketing Agreements, Mr, O’Malley never used or had the opportunity to use that information. O’Malley Decl., {| 22. 51. To the extent a portion of GPB’s Trade Secret Disclosure refers to GPB’s contribution to the Joint Technology described in § 2 of the Marketing Agreements, Mr. O’Malley never disclosed that information to a third party lender or anyone else. O’Malley Decl., 422. 52. Mr. O'Malley did not participate in the marketing of the Joint Technology to an 52. 15 BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION& 5 ° 2 o a z 155 Montgomer (415) 277-7200 w a BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting Supporting Evidence Evidence and Defendants’ Reply prospective licensee. O'Malley Decl., { 22. 53. Regarding the potential sublicensing of GPB’s rights and interest in the Joint Technology, which BillFloat was authorized to do by §2 of the marketing agreements, no such sublicenses have been issued. O’Malley Decl., {| 22; Gilbert Decl., § 13; Singer Decl., {| 23-26. 53. xX. ISSUE TEN: Fifth Cause of Action for Misappropriation of Trade Secrets A. GPB’s Fifth Cause of Action for Misappropriation of Trade Secrets has no merit because Plaintiff has no evidence of misappropriation of its alleged trade secrets by Mr. Gilbert. BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting Supporting Evidence Evidence and Defendants’ Reply 54. Regarding the potential sublicensing of GPB’s rights and interest in the Joint Technology, which BillFloat was authorized to do by §2 of the marketing agreements, no such sublicenses have been issued. O’Malley Decl., § 22; Gilbert Decl., § 13; Singer Decl., {| 23-26. 54. 55. Regarding both the information of GPB that has been provided in its Trade Secret Disclosure and more specific information that may exist, but is not identified in the Disclosure, Mr. Gilbert never used or had the opportunity to use any such information. Gilbert Decl., 4.13. 56. Regarding both the information of GPB that has been provided in its Trade Secret Disclosure and more specific information that may exist, but is not identified in the Disclosure, Mr. Gilbert never disclosed any such information to a third party lender or anyone else. Gilbert Decl., 13. 56. 57. To the extent a portion of GPB’s Trade Secret 37. 16 BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION& 5 ° 2 o a z 155 Montgomer (415) 277-7200 w a BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting Supporting Evidence Evidence and Defendants’ Reply Disclosure refers to GPB’s contribution to the Joint Technology described in § 2 of the Marketing Agreements, Mr. Gilbert never used or had the opportunity to use that information. Gilbert Deel., |] 13. 58. To the extent a portion of GPB’s Trade Secret Disclosure refers to GPB’s contribution to the Joint Technology described in § 2 of the Marketing Agreements, Mr. Gilbert never disclosed that information to a third party lender or anyone else. Gilbert Decl., {1 13. 58. 59. Mr. Gilbert did not participate in the marketing of the Joint Technology to any prospective licensee. Gilbert Decl., {|13. 59. XI. ISSUE ELEVEN: Fifth Cause of Action for Misappropriation of Trade Secrets A. GPB’s Fifth Cause of Action for Misappropriation of Trade Secrets has no merit because Plaintiff has no evidence of misappropriation of its alleged trade secrets by BillFloat, Inc. BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting Supporting Evidence Evidence and Defendants’ Reply 53. Regarding the potential sublicensing of GPB’s rights and interest in the Joint Technology, which BillFloat was authorized to do by §2 of the marketing agreements, no such sublicenses have been issued. O’Malley Decl., {| 22; Gilbert Decl., § 13; Singer Decl., (23-26. 53. 60. Based on a reasonable inquiry by BillFloat, BillFloat has not disclosed: any of the information provided in GPB’s Trade Secret Disclosure; or more specific information that may exist, but has not been identified in the GPB’s Trade Secret Disclosure. Singer Decl., {{] 23-26. 60. 61. To the extent a portion of GPB’s Trade Secret 61. 17 BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION& 5 ° 2 o a z 155 Montgomer (415) 277-7200 w a BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting Supporting Evidence Evidence and Defendants’ Reply Disclosure refers to GPB’s contribution to the Joint Technology described in § 2 of the Marketing Agreement and the Amended Marketing Agreement, based on a reasonable inquiry by BillFloat, no one from BillFloat made any disclosure of that information to a third party lender or anyone else. Singer Decl., ff] 23-26. XII. ISSUE TWELVE: Fifth Cause of Action for Misappropriation of Trade Secrets A GPB’s Fifth Cause of Action for Misappropriation of Trade Secrets has no merit because, to the extent any material claimed by GPB to be a trade secret was shared by Defendant BillFloat, such sharing was authorized by one or more of the agreements signed by GPB and BillFloat. BillFloat’s Undisputed Material Facts and Plaintiff’s Response and Supporting Supporting Evidence Evidence and Defendants’ Reply 53. Regarding the potential sublicensing of 53. GPB’s rights and interest in the Joint Technology, which BillFloat was authorized to do by §2 of the marketing agreements, no such sublicenses have been issued. O’Malley Decl., § 22; Gilbert Decl., § 13; Singer Decl., {| 23-26. 62. To the extent any part of the Joint Technology | 62. was shared by BillFloat with a third party, any such sharing was authorized by one or more agreements signed by BillFloat and GPB. Singer Decl., §{ 23-26. 63. Given BillFloat's duty to market the Joint 63. Technology to potential sublicensees pursuant to §2.3 of the marketing agreements, to the extent any part of the Joint Technology was shared by BillFloat with a third party in connection with that duty, any such sharing was: 1) authorized by § 2.3 of the Marketing Agreement and the Amended Marketing Agreement; and 2) made pursuant to a non-disclosure agreement ("NDA") with the potential sublicensee. Singer Decl., (23-26. 18 BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION1 XII. ISSUE THIRTEEN: Fifth Cause of Action for Misappropriation of Trade Secrets 2 A GPB’s fifth cause of action for Misappropriation of Trade Secrets has no merit because Plaintiff has no evidence of any damages arising from alleged 3 Misappropriation of Trade Secrets. 4 BillFloat’s Undisputed Material Facts and Plaintiff's Response and Supporting 5 Supporting Evidence Evidence and Defendants’ Reply 6 64. In responding to written discovery served in 64. this action by Defendants, Plaintiff GPB has failed 7 || to identify any damages suffered as a result of the alleged misappropriation of trade secrets. Ex. 14, Plaintiff GPB’s Responses to Special 9 ||| Interrogatory Nos. 211 & 217 (pp. 456:17-457:17, 471:2-479:21). 11 | Date: April 27, 2017 Respectfully submitted, & 5 ° a o a z Zar WILLIAM LYEBB #193832 14 JENNIFER D. SU #291603 Attdwéys for BILLFLOAT, INC., RYAN GILBERT, and SEAN 16 O’MALLEY (415) 277-7200 155 Montgomer 19 BILLFLOAT, INC.’S SEPARATE STATEMENT IN SUPPORT OF ITS MOTION FOR SUMMARY ADJUDICATION