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Nicholas A. Rogers, California Bar No. 248900
Daniel S. LaCount, California Bar No. 244306
BERDING & WEIL LLP
2175 N. California Blvd, Suite 500
Walnut Creek, California 94596
Telephone: 925/838-2090
Facsimile: 925/820-5592
nrogers@berdingweil.com
dlacount@berdingweil.com
Attorneys for Defendants
VIETNAM TOWN CONDOMINIUM OWNERS
ASSOCIATION, JOSEPH NGUYEN, KHANH CAO HUU
and JOANY YUIN
SUPERIOR COURT OF THE STATE OF CALIFORNIA
10 IN AND FOR THE COUNTY OF SANTA CLARA - UNLIMITED
11 SAN FRANCISCO PIZZA, INC., TAN No. 17CV318151
NGUYEN, NGHIA NGUYEN and KIM
12 THUY HO, REPLY IN SUPPORT OF DEMURRER
OF VIETNAM TOWN CONDOMINIUM
13 Plaintiffs, OWNERS ASSOCIATION, JOSEPH
NGUYEN, KHANH CAO HUU, AND
14 VS. JOANY YUIN TO THE FIRST
AMENDED COMPLAINT
15 VIETNAM TOWN CONDOMINIUM
OWNERS ASSOCIATION, INC.; MATRIX
16 ASSOCIATION MANAGEMENT; JOSEPH Hearing Date: September 25, 2018
NGUYEN, an Individual; KHANH CAO Time: 9:00 a.m.
17 HUU, an Individual; JOANY YUIN, an Dept. 19
Individual; NGOC BUI, an Individual; LAP
18 T. TANG, an Individual; MICHAEL Hon. Peter H. Kirwan
JOHNSON, an Individual; DAVID
19 ALVARADO, an Individual; and DOES 1
through 50 inclusive, Action Filed: October 25, 2017
20 Trial Date: None
Defendants.
21 /
22 Defendants VIETNAM TOWN CONDOMINIUM OWNERS ASSOCIATION, INC.
23 (“Association”), JOSEPH NGUYEN, KHANH CAO HUU, and JOANY YUIN (collectively
24 “Defendants”), submit this Reply Brief in Support of their Demurrer to the First Amended
25 Complaint (the “FAC”) of Plaintiffs SAN FRANCISCO PIZZA, INC. (“San Francisco Pizza”),
26 TAN NGUYEN, NGHIA NGUYEN, and KIM THUY HO (“Owners”) (collectively San
27 Francisco Pizza and Owners are referred to as “Plaintiffs”).
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L INTRODUCTION
This Reply Brief jointly responds to Plaintiffs San Francisco Pizza and Owners’
separately filed oppositions to Defendants’ demurrer. Plaintiff San Francisco Pizza does not
oppose Defendants’ demurrer but, rather, concedes that the FAC is deficient and requests an
opportunity to further amend. Plaintiff Owners submitted an opposition that does not address the
substance of the demurrer and instead asserts contentions arising from the purported merits of
their case based on facts and allegations not contained in the FAC. Taken together, the
oppositions demonstrate Plaintiffs have not, and cannot, assert a single sustainable cause of action
against Defendants. Accordingly, Defendants’ demurrer should be sustained in its entirety
10 without leave to amend.
11 I. PLAINTIFFS’ CAUSES OF ACTION AGAINST DEFENDANTS ARE SUBJECT
12 TO GENERAL AND SPECIAL DEMURRER
13 A. Plaintiffs’ Claims of Trespass and Conversion Fail to State a Cause of Action
and are Uncertain
14
15 Plaintiffs’ first and second causes of action alleging trespass and conversion, respectively,
16 are nearly indistinguishable, as both causes of action require a showing of intentional interference
17 with the possession of personal property that has caused damages. (See Fremont Indemnity Co. v.
18 Fremont General Corp. (2007) 148 Cal.App.4” 97, 119: 7] hrifty-Tel, Inc. v. Bezenek (1996) 46
19 Cal.App.4" 1559, 1566.) As set forth fully in the Demurrer, the FAC fails to plead facts
20 sufficient to satisfy each element of either cause of action because allegations asserted in the FAC
21 do not support an inference that Defendants lacked the right to disconnect the unauthorized gas
22 line from existing as-built Utility Facilities located in the common area, or otherwise prevent
23 access to the common area. The judicially noticeable CC&Rs reflect Defendants had the
24 indisputable right to manage, operate, repair and restore the common areas under the CC&Rs.
25 (Defendants’ Request for Judicial Notice (“RJN”) at §§ 5.1 (A)(1); 6.3; see also 5.1 (A)(2)(A);
26 6.1.)
27 In opposition, Owners assert their ownership right in the common area gas line is
28 provided for in Section 2.2 of CC&Rs. This contention was not asserted in the FAC and cannot be
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cured by further amendment because, as Plaintiffs’ concede in the FAC, “[t]he right to use gas
lines is not a property right held by the Unit owners before the line is connected to their Unit.”
(See FAC, at § 16; Ex. B to RJN at §§ 5.1(A)(1); 6.1.) Pursuant to the CC&Rs, Plaintiffs have no
right to the gas line in the absence of securing Association approval. (Ex. B to RJN, at §§
5.1(A)(1), 5.1(A)(2)(a), 6.3.) Although Plaintiffs plead they obtained the Association’s express
approval, this contention is directly contradicted by Plaintiff Kim Thuy Ho’ admission to the
Court at a preliminary injunction hearing that the Owners did not obtain such approval and other
factual allegations in the FAC that Plaintiffs could not obtain approval because the Association
failed “to consider and approve or disapprove the applications of Unit owners, including
10 specifically Plaintiffs, to have their Units approved for restaurant use....”. (See FAC, at § 35; Ex.
11 C to RJN, at 93:3-93:15). Pleading factual averments in the alternative is not permitted as
12 Defendants are entitled to a distinct statement of the facts claimed to exist, as such pleading is
13 uncertain and ambiguous. (Drake v. Morris Plan Company (1975) 53 Cal.App.3d 208, 210-211.)
14 In opposition, Owners further contend: (1) prior counsel failed to submit “complete e-
15 mails” at the preliminary injunction hearing that demonstrated that the Association approved of
16 the gas line; and (2) Plaintiff Ho’s admission to the Court under oath was “mistaken.” However,
17 the FAC does not reflect or allege the existence of any such e-mails and Owners failed to even
18 include or cite such evidence or a declaration from Plaintiff Ho to support these assertions. These
19 unsupported assertions should not be considered by the Court, particularly for purposes of
20 opposing a demurrer.
21 Plaintiffs failed to plead sufficient facts showing any alleged unlawful interference with
22 purported property rights, a necessary predicate to sustain a claim of trespass or conversion
23 against Defendants. In opposition, Plaintiffs failed to demonstrate leave to amend would not be
24 futile and as a result the demurer should be sustained without leave to amend.
25 B. Plaintiffs’ Third Cause of Action for Intentional Interference with
Prospective Economic Advantage Fails to State Sufficient Facts and is
26 Uncertain
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28 Kim Thuy Ho is also the Owner Plaintiff who purportedly “verified” the Amended Complaint.
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Plaintiffs’ claim for intentional interference with prospective economic advantage is
wholly derivative of Plaintiffs’ trespass and conversion claims and, for the reasons discussed
above, the Demurrer should be sustained without leave to amend. Plaintiffs failed to allege facts
sufficient to satisfy elements of this claim and, in particular, any independently wrongful conduct
beyond the mere allegation of alleged interference. (Reeves v. Hanlon (2004) 33 Cal.4th 1140,
1152; San Jose Construction, Inc. v. S.B.C.C., Inc. (2007) 155 Cal.App.4th 1528, 1544-1545.)
In opposition, Plaintiffs contend disconnection of the gas line was “independently
wrongful” because the Association did not have a requisite permit from the City of San Jose to
disconnect the gas line. Putting aside the fact that this assertion is false, for purposes of the
10 Demurrer, it is undisputed that this allegation does not appear in the FAC and is asserted for the
11 first time in opposition papers. This assertion in the opposition is not supported by any admissible
12 evidence and should not be considered by the Court.
13 Owners further argue that the Governing Documents do not provide that the Association
14 has an “exclusive” right to repair and maintain common area utility lines, because the word
15 “exclusive” is not included in the provisions cited by the Defendants in their demurrer.
16 Defendants submit that the citied portions of the CC&Rs are clear on this point. Section 5.1
17 requires that the Association:
18 “.. maintain, repair, replace (when necessary), restore, operate and manage all of
the Common Area and all facilities, (including Utility Facilities to the extent
19 described in Section 6.3)...”
20 (See Ex. B to RIN, at §5.1 (A)(1).)
21 Section 6.3, in turn, provides, in pertinent part, that the Association:
22 “.. shall maintain all Utility Facilities located in the Common Area except for
those facilities maintained by utility companies, public, private, or municipal and
23 those maintained by the Owners as described in Section 5.1.A(2)...”
24 (See Exhibit B to RJN, at §6.3; see also § 6.1 [“Utility Facilities” include pipes ete.].)
25 Section 5.1 (A)(2), provides that Owners’ obligation maintenance and repair obligations
26 are limited to certain utilities located inside the unit. (See Ex. B to RJN, at $5.1 (A)(2); see also §
27 6.3.) These provisions of the CC&Rs limit an Owner’s maintenance and repair obligations to
28 utilities located inside the unit and result in the Association’s exclusive right to control facilities
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in the common area, including the gas line at issue. As such, the FAC fails to assert facts
sufficient to constitute any independently wrongful acts to sustain the claim as Association was
entirely justified in disconnecting Plaintiffs’ unauthorized utility line. Accordingly, Defendants
respectfully request the Court sustain their demurrer as to the third cause of action without leave
to amend.
Cc. Plaintiffs’ Fourth Cause of Action for Breach of Contract
Plaintiffs allege Defendants breached the CC&Rs and attached “Exhibit D” of the CC&Rs
in support of their breach of contract claim. The Demurrer is based on the following grounds: (1)
the CC&Rs are a unique instrument sounding in land use, enforceable covenants, and equitable
10 servitudes, but does not satisfy elements of contract formation and, therefore, Plaintiffs’ cause of
11 action for breach of contract fails as a matter of law; (2) judicially noticeable provisions of the
12 CC&Rs defeat Plaintiffs’ claims because they contradict allegations pled by Plaintiffs; and (3)
13 that San Francisco Pizza does not own a unit within the Association, but rather is a tenant of the
14 Owners, and therefore not a member of the Association or with any right to sue for breach of the
15 CC&Rs. Owners’ contentions in opposition to the Demurrer are without merit.
16 1. Plaintiffs’ Cause of Action for Breach of Contract Fails as a Matter of
Law
17
18 In opposition, Owners do not address the first grounds for demurrer. As set forth fully in
19 the demurrer, and incorporated by reference herein, the CC&Rs are a unique instrument sounding
20 in land use, enforceable covenants, and equitable servitudes, but do not satisfy elements of
21 contract formation and, therefore, Plaintiffs’ cause of action for breach of contract fails as a
22 matter of law. (See Franklin y. Marie Antoinette Condominium Owners Association (1993) 19
23 Cal.App.4th 824, 828 [no appellate authority to support claim that enabling declaration is an
24 enforceable contract]; Treo @ Ketner Homeowners Association v. Superior Court (2008) 166
25 Cal.App.4th 1055, 1066 [CC&Rs are construed as a contract but are equitable servitudes; not a
26 contract].) This constitutes an independent ground to sustain Defendants’ demurrer to the Breach
27 of Contract cause of action that cannot be cured through a further amendment to the pleadings.
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2 Plaintiffs’ Failed to Attach the CC&Rs that Reflect Contrary Facts
The above referenced CC&R provisions—and those referenced in Defendants’ opening
papers—demonstrate Plaintiffs failed to allege the CC&Rs were breached. In opposition, Owners
contend they obtained Association approval, but ignore Plaintiff Ho’s admission to the Court at a
preliminary injunction hearing that the Owners did not obtain such approval. (Ex. C to RJN, at
93:3-93:15). Plaintiff Kim Thuy Ho’s admission defeats Owners’ assertion that they obtained
approval and Owners have presented no admissible evidence to support their contentions or
otherwise correct the impermissible alternative factual averments asserted to support this claim.
(FAC, 435.)
10 3. Lack of Contractual Privity Between San Francisco Pizza and
11 Defendants.
12 In opposition, San Francisco Pizza does not address, and thereby concedes, it is a tenant
13 with no rights under the CC&Rs including standing to assert a claim for breach of any equitable
14 servitude. (See Farber v. Bay View Terrace Homeowners Association (2006) 141 Cal.App.4th
15 1007, 1011-1012 [only members have standing to sue for breach of the CC&Rs. As noted above,
de
16 San Francisco Pizza Ss ‘opposition” does oppose Defendants’ demurrer but, rather, concedes the
17 FAC is deficient and simply requests an opportunity to further amend its Complaint. (FAC, at p.
18 4) [“San Francisco Pizza, Inc.’s breach of contract cause of action against the Association does
19 not fail and the Defendants [sic] Demurrer should be denied and/or Plaintiff San Francisco Pizza,
20 Inc., should be allowed leave to amend.”].) This conclusory statement does not address how San
21 Francisco Pizza can, as a matter of law, establish standing under the CC&Rs to sue the
22 Association and should be dismissed without leave to amend because any further amendment
23 would be futile.
24 Moreover, Owners’ opposition is also problematic as the contract they now contend is at
25 issue is a “Commercial Property Agreement and Joint Escrow Instructions Agreement” (“New
26 Agreement”). Plaintiffs ask the Court to take judicial notice of this New Agreement but fail to
27 attach the New Agreement to their Request for Judicial Notice. Moreover, Plaintiffs fail to (1)
28 state who all of the parties to the New Agreement are; (2) assert that Defendants are parties to the
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New Agreement; or (3) cite any portion of the New Agreement. Because the New Agreement is
not in the FAC, it should not be considered here. Its “inclusion” for the first time in Owners’
opposition merely highlights the fact that the FAC is insufficiently pled. Even assuming
arguendo, that the New Agreement does exist, Owners have not explained how this puts San
Francisco Pizza in privity of contract with Defendants. Accordingly, contentions asserted in
opposition to the Demurrer are without merit and, because deficiencies identified by Defendants
cannot be cured through further amendment to the pleadings, Defendants’ respectfully request the
Demurrer should be sustained without leave to amend.
D. Plaintiffs’ Fifth Cause of Action for Declaratory Relief is Superfluous
10 Plaintiffs seek a determination that Unit 9015 is approved for use as a “restaurant facility
1 pursuant to Exhibit ‘D’ of the [CC&Rs], and that Unit 9015 is entitled to access and use of the
12 gas line...” (FAC, 945. ) California Courts have long held that, “[{t]he declaratory relief statute
13 should not be used for the purpose of anticipating and determining an issue which can be
14 determined in the main action.” (General of America Ins. Co. v. Lilly (1968) 258 Cal.App.2d 465,
15 470.) Rather, the “object of the statute is to afford a new form of relief where needed and not to
16 furnish a litigant with a second cause of action for the determination of identical issues.” (/d.)
17 Indeed, where the issues raised in a declaratory relief cause of action are “fully engaged by other
18 causes of action,” the declaratory relief claim is “unnecessary and superfluous.” (Hood v.
19 Superior Court (1995) 33 Cal.App.4th 319, 324.)
20 In opposition, Owners do not argue that the issues presented in this cause of action are not
21 identical to issues raised in support of other claims, but instead assert that declaratory relief will
22 provide them with a different “form of relief.” This argument is a proverbial red herring because
23 the declaratory relief claim does not raise new issues and is entirely derivative of determinations
24 made with respect to the first, second, third and fourth causes of action. And, since Plaintiffs
25 failed to allege facts sufficient to support such claim, the declaration relief claim fails and the
26 Demurrer as to this claim should also be sustained without leave to amend.
27 E Plaintiffs Seventh Cause of Action for Negligent Misrepresentation Fails to
State a Cause of Action and is Uncertain
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Plaintiffs’ seventh cause of action for negligent misrepresentation is subject to demurrer
because it is not pled with particularity. (See Committee on Children’s Television, Inc. v. General
Foods Corp. (1983) 35 Cal.3d 197 215-216, superseded by statute on other grounds
[misrepresentation requires specific factual allegations]; Small v. Fritz Companies, Inc. (2003) 30
Cal.4" 167, 184; Moncada v. West Coast Quartz Corp. (2013) 221 Cal.App.4" 768, 781.)
Plaintiffs base their claim on a single vague allegation that “the Board” announced permission
was no longer required to use a unit as a “food unit.” (FAC, $9). This contains no specific factual
detail as to who published the statement, where it was published, when it was published, or how
Plaintiffs relied on it. The absence of any reliance on the purported statement is particularly
10 apparent as Plaintiffs assert facts in the FAC and in opposition that they continued to request
11 Board approval for their—completed—architectural modifications through August 2017.
12 This contention precludes any ability to allege reliance as it is apparent Plaintiffs sought
13 Board approval throughout the relevant time period in contradiction to any inference that they
14 held a subjective belief they no longer needed permission from the Association to operate their
15 unit as a restaurant. Indeed, Plaintiff Ho testified in accordance with the complaint that they
16 repeatedly sought to secure the support of the Association’s property manager in recommending
17 approval to the Board. Quite simply, the FAC and sworn testimony assert impermissible
18 contradictory factual averments that preclude any inference or reliance. Accordingly, the
19 Demurrer should be granted without leave to amend.
20 F. Plaintiffs Fail to State a Cause of Action for Unlawful Business Practices
21 In That v. Alders Maintenance Association (2012) 206 Cal.App.4" 1419, an appellate
22 court held “homeowners associations” are not businesses for purposes of Section 17200 absent a
23 showing the association itse/f engages in commerce. (/d. at 1426.) In opposition, Owners do not
24 address arguments raised by Defendants in support of the Demurrer based on That v. Alders
25 Maintenance Association but, instead, assert allegation not contained in the FAC.
26 San Francisco Pizza raises its only “argument” in opposition to the demurer to this cause
27 of action. But, San Francisco Pizza does not ask the Court to overrule the Demurrer with respect
28 to this claim and instead contends it should be permitted to amend because the “UCL may well
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1 apply to an association that is engaged in anti-competitive or unfair conduct affecting the
2 market.” San Francisco Pizza appears to be rephrasing the following dicta from the That court:
“We do not foreclose entirely the notion that the UCL could apply to an
association. If, for example, an association decided to sell products or services that
are strictly voluntary purchases for members or nonmembers, it might be liable for
such acts under the UCL. But applying the UCL to an election dispute would
simply make no sense. An association, operating under its governing documents to
maintain its premises and conduct required proceedings, possesses none of the
relevant features the UCL was intended to address. Applying the UCL in this
context would both misconstrue the intent of that statute and undermine the
specific procedures set forth in the Davis-Stirling Act.”
(Id. at 1427.)
There is no assertion in the FAC alleging the Association sold products or services to
10 members or nonmembers. The Association does not engage in products in the stream of
11 commerce and, even if it did, there is no such allegation in the FAC that it did so to the detriment
12 of Plaintiffs. Accordingly, dicta from That has no bearing on this matter. Accordingly,
13 Defendants respectfully request the Court sustain their demurrer as to the ninth cause of action
14 without leave to amend.
15 il. CONCLUSION
16 For all of the reasons discussed herein and in Defendants’ opening papers, the FAC is
17 subject to general and special demurrer. Defendants respectfully request this Court sustain the
18 Demurrer without leave to amend.
19 Date: September 18, 2018 BERDING & WEIL LLP
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21 CL. LL
By: 7
Nicholas A. Rg
22 Dan: jel S. LaCoyht
Attorneys for Defendants
23
VIETNAM TOWN CONDOMINIUM
OWNERS ASSOCIATION, JOSEPH
24
NGUYEN, KHANH CAO HUU, and
JOANY YUIN
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PROOF OF SERVICE
Case Name: San Francisco Pizza, Inc., et al. v. Vietnam Town Condominium Owners
Association, Inc., et al.
Case No: Santa Clara County Superior Court Case No.: 17CV318151
I am employed in the County of Contra Costa, State of California. My business address is
2175 N. California Blvd., Suite 500, Walnut Creek, California 94596. I am over the age of
eighteen years, and not a party to the within action.
On September 18, 2018, I served the within:
REPLY IN SUPPORT OF DEMURRER OF VIETNAM TOWN CONDOMINIUM
OWNERS ASSOCIATION, JOSEPH NGUYEN, KHANH CAO HUU, AND
JOANY YUIN TO THE FIRST AMENDED COMPLAINT
on the party[ies] listed below, addressed as follows:
10 (SEE ATTACHED SERVICE LIST)
ll O By First Class Mail/Ordinary Business Practices [C.C.P. §§ 1013, 1013a]. By causing
a true copy thereof to be enclosed in a sealed envelope or package, addressed to the
12 party[ies] as stated on the attached service list. I am readily familiar with the firm's
business practice for collection and processing of envelopes and packages for mailing with
13 the United States Postal Service. Under the firm's practice, mail is deposited in the
ordinary course of business with the United States Postal Service at Walnut Creek,
14 California, that same day, with postage thereon fully prepaid. 1 am aware that upon motion
of the party served, service is presumed invalid if postal cancellation date or postage meter
15 date on the envelope or package is more than one day after the date of deposit for mailing.
16 By Overnight Delivery [C.C.P. § 1013, 1013a]. By causing a true copy thereof to be
enclosed in a sealed envelope or package designated by the express service carrier, with all
17 delivery fees paid or provided for, addressed to the party[ies] as stated on the attached
service list. I am readily familiar with the firm's business practice for collection and
18 processing of overnight deliveries for deposit in a box or other facility regularly
maintained by the express service carrier, or delivered to an authorized courier or driver
19 authorized by the express service carrier to receive documents. Under the firm's practice,
overnight deliveries are deposited in the ordinary course of business with the express
20 service carrier at Walnut Creek, California, that same day.
21 By Personal Service [C.C.P. § 1011]. By causing a true copy thereof to be hand-
delivered in a sealed envelope or package addressed to the party[ies] as stated on the
22 attached service list.
23 By Electronic Service. The above document was served electronically on the parties
appearing on the attached service list associated with this case. A copy of the electronic
24 mail transmission[s] will be maintained with the proof of service document.
25 I declare under penalty of perjury under the laws of the State of California that the
foregoing is true and correct. Executed September 18, 2018, at Walnut Creek, California.
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Barbara Curzi
BERDING & WEIL, LLP500 PROOF OF SERVICE
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SERVICE LIST
Case Name: San Francisco Pizza, Inc., et al. v. Vietnam Town Condominium Owners
Association, Inc., et al.
Case No: Santa Clara County Superior Court Case No.: 17CV318151
Robert T. Tang, Esq. Gerald T. Lau, Esq.
Law Offices of Robert T. Tang Prudential Law Corporation
1580 Oakland Road, C205 533 Airport Blvd., Suite 400
San Jose, CA 95131 Burlingame, CA 94010
(408) 816-8098 (650) 268-8128
Email: roberttlaw1 @gmail.com Email: gerald@prudentialaw.com
Attorney for Plaintiffs Attorney for Defendant
Tan Nguyen, Nghia Nguyen, Kim Thuy Vietnam Town Condominium Owners
Ho and Ngoc Bui Association, Inc.
Gary B. Wesley, Esq. Guy Wainwright Stilson, Esq.
10 707 Continental Circle, #424 Low Ball & Lynch
Mountain View, CA 94040 505 Montgomery St., 7" Floor
11 (408) 882-5070 San Francisco, CA 94111-2584
Gary.wesle ahoo.com (415) 981-6630
12 gstilson@lowball.com
Attorney for Plaintiff
13 San Francisco Pizza, Inc. Attorney for Defendant
Matrix Assoc. Mgmt.
14
David McDonough, Esq.
15 Wood, Smith, Henning & Berman LLP
1401 Willow Pass Road, Suite 700
16 Concord, CA 94520
(925) 229-3336
17 DMcDonough@wshblaw.com
18 Attorney for Defendant
Michael Johnson
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