Preview
Andrew M. Agtagma (Bar No. 180703)
LAW CENTER
1291 E Hillsdale Blvd, Suite 211B
Foster Citv, California 94404
F'ILED'
SAN MATEO COUNTY
(650 372—2600 Telephone)
(650 372-9318 Facsimile)
JUN l 8 2018
Attorney for Plaintiff
Sweet Production, Inc.
COCDVIQUIr-PODNDH
SUPERIOR COURT OF THE STATE OF CALIF ORN VA
FOR THE COUNTY OF SAN MATEO
'
SWEET PRODUCTION, INC., aCali‘fornia Case No. '0
2113
‘ V 0 3 1 1
corporation , 18 C
94404
Suite
COMPLAINT FOR:
Corporation
Plaintiff,
Blvd.,
Breach of Fiduciary Duty of Loyalty
CENTER
California
Breach of Fiduciary Duty to Use
V. $99.”? Reasonable Care
Intentional Interference with
LAW
City,
Hillsdale
Professional
SOLOMON SHA, an individual; and DOES Pros ective Economic Advantage
\
1 to 10, inclusive Neg igent Interference with
E.Foster Prospective Economic Advantage
A Defendants.
wmwwmwwwml—‘D—‘HHP—ll—lb—lh—Ib—‘r—l
1291
REQUEST FOR JURY TRIAL
mummewwwooooxiosmcoMH-o
BY FAX
Plaintiff Sweet Production, Inc. alleges:
THE PARTIES
1. This is a complaint by Sweet Production, Inc. (“SP1”) against Solomon Sha _
(“Sha”) arising out of acts in his capacity as a managerial employee of SP1.
2. At all times relevant to this complaint, Plaintiff SP1 is and has been a
corporation organized and existing under the laws of the State of California. It is and was, at
all times relevant to this complaint, qualified to do business in California.
3. SP1 is informed and believes, and on that basis alleges, that at all times relevant
to this complaint, Defendant Sha is and has been an individual residing in the city of San
Mateo, in San Mateo County, California.
"
xe—cw—uanu
GMP !
Complaint .
-1-
Complaint for Business Torts
ii‘ii‘liuumumW
4. SP1 does not know the true names and capacities, whether individual, corporate
or otherwise, of defendants Does 1 to 10, and therefore sues them by such fictitious names.
SP1 is informed and believes, and on that basis alleges, that each of the Doe defendants is in
some manner responsible for the damages alleged in this complaint.
5. SP1 is informed and believes, and on that basis alleges, that at the various times
(OGDVCDU'IdkwwH
alleged in this complaint, each of the named and Doe defendants was the agent or employee of
each of the remaining co-defendants and, in doing the actions alleged in this complaint, was
acting within the course and scope of said agency, employment and service with the advance
knowledge, consent and/or ratification of each of the remaining defendants. The named and
Doe defendants are hereinafter referred to collectively in this complaint as “Defendants.”
211B
94404
Suite
FACTS COMMON TO ALL CAUSES OF ACTION
Corporation
6. SP1 is a wholesale bakery. It was incorporated and began operations in May
Blvd.,
California
CENTER
2007. It produces baked goods for retail outlets throughout the San Francisco Bay area.
LAW
City,
Hillsdale
Professional 7. Sha is one of the shareholders of \SPI. He worked at the company since it
E. Foster
opened for business. He was discharged effective May 31, 2018.
A
1291
8. Sha was also a managerial employee of SPI.
MmmmmmmwwD—‘HI—‘D—ID—lh—IHh—Ip—Ii—A
He further served as the
company’s corporate secretary. He oversaw the distribution side of bakery operations. In
overseeing the distribution of SPI’s goods,
MVQU‘IVPOONJD—IOQOUJVQUIMPOOMD—‘O
Sha’s job responsibilities included, but were not
limited to:
a) hiring and firing employees;
b) supervising employees, particularly packers and delivery drivers;
c) coordinating employees’ work schedules;
d) ensuring that employees accurately recorded their “clock in” and “clock
out” times;
e) making sure that the departments involved in distributing SPI’s goods
were adequately staffed; and
f) making sure that SPI delivered its goods on time.
_2_
Complaint for Business Torts
9. From at least October 2013 through June 2014, Sha took actions that were
inimical to the best interests of the company, including but not limited to:
a) conspiring with subordinates to falsify employee time records;
b) failing to report the falsified employee time records to SP1;
c) concealing the falsified employee time records from SP1; and
(OOOVIOUUlODMH
d) receiving cash proceeds from the falsified employee time records for his
own benefit.
10. SP1 is informed and believes, and on that basis alleges, that Sha engaged in the
scheme to falsify employee time records so that he would have money to spend that he did not
have to account for.
2113
11. SP1 first became aware of this scheme in and around late April 2016. It could
94404
Suite
not have learned of this scheme beforehand because Sha was entrusted with, and responsible
Corporation
for, ensuring that employees recorded their work times accurately. He used his oversight of
Blvd.,
California
CENTER
this area to conceal his actions. The company learned of the scheme from an employee who
LAW
City,
Hillsdale
Professional assisted Sha in carrying it out. That employee revealed the scheme to SP1 only after being
E. Foster
fired by Sha.
wmmMMMMF—‘i—‘r—lh—lh—li—‘b—Ir—Ib—Ir—I
A
1291
12. Given the source of the allegations against Sha, and the circumstances under
which they were disclosed, SPI did not take immediate action against him. However, it began
to scrutinize Sha’s oversight of employees ’ “clock in” and “clock out” times.
CDVQUIrhw-‘OCDGDVOEUWrPWMb-‘O
It took action
against Sha only after other events occurred that lent credibility to the allegations against him.
13. SPI is informed and believes, and on that basis alleges, that Sha became upset
with the company aroundJanuary 2016. SPI is further informed and believes, and on that
basis alleges, that Sha came to believe that the majority shareholders in the company
unlawfully acquired a large portion of his ownership interest, and refused to pay him what he
was entitled to as one of SPI’s shareholders.
14. After January 2016, Sha took further actions that were inimical to the best
interests of the company, that resulted, among other things, in:
///
-3-
Complaint for Business Torts
a) the departments responsible for distributing SPI’s goods being
V
chronically understaffed; and
b) deadlines for early-morning customer deliveries being repeatedly
missed.
15. Sha’s conduct directly resulted in. SPI suffering harm, including, but not limited
coooxioamup-oomH
to:
a) losing the amounts paid in wages because of falsified employee time
records for wages that were not actually earned;
b) losing the amounts paid in payroll taxes and other liabilities because of
falsified employee time records for wages that were not actually earned;
and
2113
94404
c) losing prospective income from customers who scaled back or ceased
Suite
Corporation
doing business with SPI because of untimely deliveries.
Blvd.,
California
CENTER
16. Among the customers who scaled back or ceased doing. business with SPI are
City,
Hillsdale
Professional
LAW
Fountain Café in Oakland; Grand Hyatt San Francisco; Courtyard by Marriott San Francisco
E. Foster
Downtown; the Holiday Inn Sanjose; and Team SanJose at the SanJose Convention Center
A
1291
and Visitors Bureau.
[\DMNMMMMMND—IHP—‘D—db—IHHD—‘l—IH
FIRST CAUSE OF ACTION FOR BREACH OF FIDUCIARY DUTY OF LOYALTY
WVQUWQOOwr—IOCOQVCSUIAWMHO
lAgainst Solomon Sha}
l7. SPI restates and incorporates by this reference, as if fully set forth herein, each
and every allegation contained in paragraphs 1 through 16 of this complaint.
18. Sha was a fiduciary of SPI, in that he was a managerial employee, and served as
the company’s corporate secretary.
19. Sha knowingly acted against SPI’s interests in connection with obtaining
unearned money from the company by falsifying employee time records. Sha further
knowingly acted against SPI’s interests in taking deliberate actions to prevent the departments
///
-4-
Complaint for Business Torts
responsible for distributing SPI’s goods from being adequately staffed; and in taking
deliberate actions to prevent early-morning customer deliveries from being made on time.
20. SP1 did not give informed consent to Sha’s conduct in that it was not aware of
such conduct while it was occurring, and actively took steps to counter the manifest results of
such conduct.
(OQDVQCNARCOMH
21. SP1 was, harmed as a result of Sha taking these actions that were inimical to the
best interests of the company.
22. Sha’s conduct was a substantial factor in causing SPI’s harm.
23. SP1 is informed and believes, and on that basis alleges, that Sha’s outrageous
conduct was malicious and oppressive, and done with a conscious disregard of its rights, and
with the intent to injure the company. Specifically, SP1 is informed and believes, and on that
2113
94404
basis alleges, that afterJanuary 2016, Sha took actions that were inimical to the best interests
Suite
CorporatiOn
of the company with the intent to cause it to lose customers and go out of business. Thus, SPI
Blvd.,
California
CENTER
seeks an award of punitive and exemplary damages in an amount according to proof.
City,
Hillsdale
Professional
LAW
E. Foster
SECOND CAUSE OF ACTION FOR BREACH OF FIDUCIARY DUTY TO USE
A wmmwwmmwwb—Ar—IHr—Ir—Ih—Ih—Ir—AD—Ir—I
1291
REASONABLE CARE
(Against Solomon Sha}
24. SP1 restates and incorporates by this reference, as if fully set forth herein, each
CDVQCJ‘Ir-POONJHOQDCDVOSUlt-F-e—IO
and every allegation contained in paragraphs 1 through 16 of this complaint.
25. Sha was a fiduciary of SPI, in that he was a managerial employee, and served as
the company’s corporate secretary.
26. Sha acted on SPI’s behalf for purposes of overseeing the distribution side of its
bakery operations.
‘
27. Sha failed to act as a reasonably careful managerial employee would have acted
under the same or similar circumstances, in failing to ensure that the departments responsible
for distributing SPI’s goods were adequately staffed; and in failing to ensure that deadlines for
early-morning customer deliveries were met.
-5-
Complaint for Business Torts
28. SP1 was harmed as a result of Sha taking these actions that were inimical to the
best interests of the company.
29. Sha’s conduct was a substantial factor in causing SPI’s harm.
THIRD
(DCDVOUUTHkOONJH
CAUSE OF ACTION FOR INTENTIONAL INTERFERENCE WITH
PROSPECTIVE ECONOMIC ADVANTAGE
(Against Solomon Shal
30. SP1 restates and incorporates by this reference, as if fully set forth herein, each
and every allegation contained in paragraphs 1 through 16 of this complaint.
31. SP1 had economic relationships with various customers that probably would
2118
have resulted in an economic benefit to SP1, including, but not limited to, Fountain Café in
94404
Suite
Oakland; Grand Hyatt San Francisco; Courtyard by Marriott San Francisco Downtown; the
Corporation
Holiday Inn San Jose; and Team SanJose at the San Jose Convention Center and Visitors
Blvd.,
California
CENTER
Bureau.
LAW
City,
Hillsdale
Professional 32. Sha knew of these relationships.
E. Foster
33. Sha engaged in actions that breached his fiduciary duty of loyalty, including,
A
but not limited to, taking deliberate actions to prevent the departments responsible for
MMMMMMMMMD—lr—‘b—IHr—lb—‘b—ib—‘b—It—fi
1291
distributing SPI’s goods from being adequately staffed; and taking deliberate actions to
prevent early—morning customer deliveries from being made on time.
WVGCHVPOONJP—‘OQOWVQU'vQDMb-‘O
34. By engaging in this conduct, Sha intended to disrupt these relationships.
35. These relationships were disrupted in that Sha’s actions caused these customers
to scale back or cease doing business with SP1.
36. SP1 was harmed, in that it lost prospective income from these customers.
37. Sha’s conduct was a substantial factor in causing SPI’s harm.
38. SP1 is informed and believes, and on that basis alleges, that Sha’s outrageous
conduct was malicious and oppressive, and done with a conscious disregard of its rights, and
with the intent to injure the company. Specifically, SP1 is informed and believes, and on that
basis alleges, that afterJanuary 2016, Sha took actions that were inimical to the best interests
-5-
Complaint for Business Torts
)—l
of the company with the intent to cause it to lose customers and go out of business. Thus, SPI
seeks an award of punitive and exemplary damages in an amount according to proof.
FOURTH CAUSE OF ACTION FOR NEGLIGENT INTERFERENCE WITH
©CDVO§O1>POOKD
PROSPECTIVE ECONOMIC ADVANTAGE
(Against Solomon Sha)
39. SP1 restates and incorporates by this reference, as if fully set forth herein, each
and every allegation contained in paragraphs 1 through 16 of this complaint.
40- SPI had economic relationships with various customers that probably would
have resulted in a future economic benefit to SPI, including, but not limited to, Fountain Café
2113
in Oakland; Grand Hyatt San Francisco; Courtyard by Marriott San Francisco Downtown; the
94404
Suite
Holiday Inn San Jose; and Team SanJose at the San Jose Convention Center and Visitors
Corporation
Bureau.
Blvd.,
California
CENTER
41. Sha knew or should have known of these relationships.
LAW
City,
Hillsdale
Professional 42. Sha knew or should have known that these relationships would be disrupted if
E. Foster
he failed to act with reasonable care.
A
1291
43. Sha failed to act with reasonable care in failing to ensure that the departments
wwwmwwwwwD—‘D—‘HHD—‘b—IHHHD—l
responsible for distributing SPI’s goods were adequately staffed; and in failing to ensure that
deadlines for early—morning customer deliveries were met.
mfloim-ODMHOQCCDVQOWFPWMHO
44. Sha engaged in wrongful conduct by breaching his fiduciary duty to use
reasonable care, and his fiduciary duty of loyalty, resulting, among other things, in the
departments responsible for distributing SPI’s goods being chronically understaffed; and
deadlines for early-morning customer deliveries being repeatedly missed.
45. These relationships were disrupted in that Sha’s actions caused these customers
to scale back or cease doing business with SP1.
46. SP1 was harmed, in that it lost prospective income from these customers.
47. Sha’s wrongful conduct was a substantial factor in causing SPI’s harm.
///
_ 7 _
Complaint for Business Torts
WHEREFORE, SWEET PRODUCTION, INC. PRAYS FORJUDGMENT
AGAINST DEFENDANTS, AND EACH OF THEM, AS FOLLOWS:
1. For compensatory damages, including, but not limited to, the amounts lost for—
paying wages and liabilities for falsified employee time records, and prospective income from
customers who scaled back or ceased
{DmflOflU‘ltFuOJNJH
doing business with SP1, in an amount that exceeds the
Court’s jurisdictional minimum and according to proof;
2. For consequential damages, according to proof;
3. For punitive damages on the First and Third Causes of Action, according to
Y
proof;
4. For an award of interest, including prejudgment interest, at the legal rate;
2113
5. For costs incurred by Sweet Production, Inc. in prosecuting this action; and
94404
Suite
6'. For such other and further relief as this Court deems just and proper.
Corporation
Blvd.,
California
CENTER
Datedzjune 15, 2018 LAW CENTER
City,
Hillsdale
A Professional Corporation
Professional
LAW
A
E. Foster
.mmmHHHHs—‘HHHH
CIUWQM"
Andrew M. A a
1291
Attorney for Plaintiff Swee roduction, Inc.
-8-
Complaint for Business Torts
)_A
REQUEST FOR IURY TRIAL
Plaintiff Sweet Production, Inc. hereby demands trial by jury against Defendant
Solomon Sha, and Does I to 10, in this action.
Datedzjune 15, 2018 LAW CENTER
COCDVOSU‘IQOJM
A Professional Corporation
1 /’d
Andrew M. Ag
Attorney for Plaintiff Swee roduction, Inc.
2113
94404
Suite
Corporation
Blvd.,
California
CENTER
City,
Professional
I-Iillsdale
LAW
E.Foster
A MMMMMMMD—Ir—‘b—ib—Ib—tb—tr—Ab—Ir—AH
1291
gEDIQQ'lvPWMP—‘OQDWVQWVPWNJHO
-9-
Complaint for Business Torts
Preview
Andrew M. Agtagma (Bar No. 180703) LAW CENTER 1291 E Hillsdale Blvd, Suite 211B Foster Citv, California 94404 F'ILED' SAN MATEO COUNTY (650 372—2600 Telephone) (650 372-9318 Facsimile) JUN l 8 2018 Attorney for Plaintiff Sweet Production, Inc. COCDVIQUIr-PODNDH SUPERIOR COURT OF THE STATE OF CALIF ORN VA FOR THE COUNTY OF SAN MATEO ' SWEET PRODUCTION, INC., aCali‘fornia Case No. '0 2113 ‘ V 0 3 1 1 corporation , 18 C 94404 Suite COMPLAINT FOR: Corporation Plaintiff, Blvd., Breach of Fiduciary Duty of Loyalty CENTER California Breach of Fiduciary Duty to Use V. $99.”? Reasonable Care Intentional Interference with LAW City, Hillsdale Professional SOLOMON SHA, an individual; and DOES Pros ective Economic Advantage \ 1 to 10, inclusive Neg igent Interference with E.Foster Prospective Economic Advantage A Defendants. wmwwmwwwml—‘D—‘HHP—ll—lb—lh—Ib—‘r—l 1291 REQUEST FOR JURY TRIAL mummewwwooooxiosmcoMH-o BY FAX Plaintiff Sweet Production, Inc. alleges: THE PARTIES 1. This is a complaint by Sweet Production, Inc. (“SP1”) against Solomon Sha _ (“Sha”) arising out of acts in his capacity as a managerial employee of SP1. 2. At all times relevant to this complaint, Plaintiff SP1 is and has been a corporation organized and existing under the laws of the State of California. It is and was, at all times relevant to this complaint, qualified to do business in California. 3. SP1 is informed and believes, and on that basis alleges, that at all times relevant to this complaint, Defendant Sha is and has been an individual residing in the city of San Mateo, in San Mateo County, California. " xe—cw—uanu GMP ! Complaint . -1- Complaint for Business Torts ii‘ii‘liuumumW 4. SP1 does not know the true names and capacities, whether individual, corporate or otherwise, of defendants Does 1 to 10, and therefore sues them by such fictitious names. SP1 is informed and believes, and on that basis alleges, that each of the Doe defendants is in some manner responsible for the damages alleged in this complaint. 5. SP1 is informed and believes, and on that basis alleges, that at the various times (OGDVCDU'IdkwwH alleged in this complaint, each of the named and Doe defendants was the agent or employee of each of the remaining co-defendants and, in doing the actions alleged in this complaint, was acting within the course and scope of said agency, employment and service with the advance knowledge, consent and/or ratification of each of the remaining defendants. The named and Doe defendants are hereinafter referred to collectively in this complaint as “Defendants.” 211B 94404 Suite FACTS COMMON TO ALL CAUSES OF ACTION Corporation 6. SP1 is a wholesale bakery. It was incorporated and began operations in May Blvd., California CENTER 2007. It produces baked goods for retail outlets throughout the San Francisco Bay area. LAW City, Hillsdale Professional 7. Sha is one of the shareholders of \SPI. He worked at the company since it E. Foster opened for business. He was discharged effective May 31, 2018. A 1291 8. Sha was also a managerial employee of SPI. MmmmmmmwwD—‘HI—‘D—ID—lh—IHh—Ip—Ii—A He further served as the company’s corporate secretary. He oversaw the distribution side of bakery operations. In overseeing the distribution of SPI’s goods, MVQU‘IVPOONJD—IOQOUJVQUIMPOOMD—‘O Sha’s job responsibilities included, but were not limited to: a) hiring and firing employees; b) supervising employees, particularly packers and delivery drivers; c) coordinating employees’ work schedules; d) ensuring that employees accurately recorded their “clock in” and “clock out” times; e) making sure that the departments involved in distributing SPI’s goods were adequately staffed; and f) making sure that SPI delivered its goods on time. _2_ Complaint for Business Torts 9. From at least October 2013 through June 2014, Sha took actions that were inimical to the best interests of the company, including but not limited to: a) conspiring with subordinates to falsify employee time records; b) failing to report the falsified employee time records to SP1; c) concealing the falsified employee time records from SP1; and (OOOVIOUUlODMH d) receiving cash proceeds from the falsified employee time records for his own benefit. 10. SP1 is informed and believes, and on that basis alleges, that Sha engaged in the scheme to falsify employee time records so that he would have money to spend that he did not have to account for. 2113 11. SP1 first became aware of this scheme in and around late April 2016. It could 94404 Suite not have learned of this scheme beforehand because Sha was entrusted with, and responsible Corporation for, ensuring that employees recorded their work times accurately. He used his oversight of Blvd., California CENTER this area to conceal his actions. The company learned of the scheme from an employee who LAW City, Hillsdale Professional assisted Sha in carrying it out. That employee revealed the scheme to SP1 only after being E. Foster fired by Sha. wmmMMMMF—‘i—‘r—lh—lh—li—‘b—Ir—Ib—Ir—I A 1291 12. Given the source of the allegations against Sha, and the circumstances under which they were disclosed, SPI did not take immediate action against him. However, it began to scrutinize Sha’s oversight of employees ’ “clock in” and “clock out” times. CDVQUIrhw-‘OCDGDVOEUWrPWMb-‘O It took action against Sha only after other events occurred that lent credibility to the allegations against him. 13. SPI is informed and believes, and on that basis alleges, that Sha became upset with the company aroundJanuary 2016. SPI is further informed and believes, and on that basis alleges, that Sha came to believe that the majority shareholders in the company unlawfully acquired a large portion of his ownership interest, and refused to pay him what he was entitled to as one of SPI’s shareholders. 14. After January 2016, Sha took further actions that were inimical to the best interests of the company, that resulted, among other things, in: /// -3- Complaint for Business Torts a) the departments responsible for distributing SPI’s goods being V chronically understaffed; and b) deadlines for early-morning customer deliveries being repeatedly missed. 15. Sha’s conduct directly resulted in. SPI suffering harm, including, but not limited coooxioamup-oomH to: a) losing the amounts paid in wages because of falsified employee time records for wages that were not actually earned; b) losing the amounts paid in payroll taxes and other liabilities because of falsified employee time records for wages that were not actually earned; and 2113 94404 c) losing prospective income from customers who scaled back or ceased Suite Corporation doing business with SPI because of untimely deliveries. Blvd., California CENTER 16. Among the customers who scaled back or ceased doing. business with SPI are City, Hillsdale Professional LAW Fountain Café in Oakland; Grand Hyatt San Francisco; Courtyard by Marriott San Francisco E. Foster Downtown; the Holiday Inn Sanjose; and Team SanJose at the SanJose Convention Center A 1291 and Visitors Bureau. [\DMNMMMMMND—IHP—‘D—db—IHHD—‘l—IH FIRST CAUSE OF ACTION FOR BREACH OF FIDUCIARY DUTY OF LOYALTY WVQUWQOOwr—IOCOQVCSUIAWMHO lAgainst Solomon Sha} l7. SPI restates and incorporates by this reference, as if fully set forth herein, each and every allegation contained in paragraphs 1 through 16 of this complaint. 18. Sha was a fiduciary of SPI, in that he was a managerial employee, and served as the company’s corporate secretary. 19. Sha knowingly acted against SPI’s interests in connection with obtaining unearned money from the company by falsifying employee time records. Sha further knowingly acted against SPI’s interests in taking deliberate actions to prevent the departments /// -4- Complaint for Business Torts responsible for distributing SPI’s goods from being adequately staffed; and in taking deliberate actions to prevent early-morning customer deliveries from being made on time. 20. SP1 did not give informed consent to Sha’s conduct in that it was not aware of such conduct while it was occurring, and actively took steps to counter the manifest results of such conduct. (OQDVQCNARCOMH 21. SP1 was, harmed as a result of Sha taking these actions that were inimical to the best interests of the company. 22. Sha’s conduct was a substantial factor in causing SPI’s harm. 23. SP1 is informed and believes, and on that basis alleges, that Sha’s outrageous conduct was malicious and oppressive, and done with a conscious disregard of its rights, and with the intent to injure the company. Specifically, SP1 is informed and believes, and on that 2113 94404 basis alleges, that afterJanuary 2016, Sha took actions that were inimical to the best interests Suite CorporatiOn of the company with the intent to cause it to lose customers and go out of business. Thus, SPI Blvd., California CENTER seeks an award of punitive and exemplary damages in an amount according to proof. City, Hillsdale Professional LAW E. Foster SECOND CAUSE OF ACTION FOR BREACH OF FIDUCIARY DUTY TO USE A wmmwwmmwwb—Ar—IHr—Ir—Ih—Ih—Ir—AD—Ir—I 1291 REASONABLE CARE (Against Solomon Sha} 24. SP1 restates and incorporates by this reference, as if fully set forth herein, each CDVQCJ‘Ir-POONJHOQDCDVOSUlt-F-e—IO and every allegation contained in paragraphs 1 through 16 of this complaint. 25. Sha was a fiduciary of SPI, in that he was a managerial employee, and served as the company’s corporate secretary. 26. Sha acted on SPI’s behalf for purposes of overseeing the distribution side of its bakery operations. ‘ 27. Sha failed to act as a reasonably careful managerial employee would have acted under the same or similar circumstances, in failing to ensure that the departments responsible for distributing SPI’s goods were adequately staffed; and in failing to ensure that deadlines for early-morning customer deliveries were met. -5- Complaint for Business Torts 28. SP1 was harmed as a result of Sha taking these actions that were inimical to the best interests of the company. 29. Sha’s conduct was a substantial factor in causing SPI’s harm. THIRD (DCDVOUUTHkOONJH CAUSE OF ACTION FOR INTENTIONAL INTERFERENCE WITH PROSPECTIVE ECONOMIC ADVANTAGE (Against Solomon Shal 30. SP1 restates and incorporates by this reference, as if fully set forth herein, each and every allegation contained in paragraphs 1 through 16 of this complaint. 31. SP1 had economic relationships with various customers that probably would 2118 have resulted in an economic benefit to SP1, including, but not limited to, Fountain Café in 94404 Suite Oakland; Grand Hyatt San Francisco; Courtyard by Marriott San Francisco Downtown; the Corporation Holiday Inn San Jose; and Team SanJose at the San Jose Convention Center and Visitors Blvd., California CENTER Bureau. LAW City, Hillsdale Professional 32. Sha knew of these relationships. E. Foster 33. Sha engaged in actions that breached his fiduciary duty of loyalty, including, A but not limited to, taking deliberate actions to prevent the departments responsible for MMMMMMMMMD—lr—‘b—IHr—lb—‘b—ib—‘b—It—fi 1291 distributing SPI’s goods from being adequately staffed; and taking deliberate actions to prevent early—morning customer deliveries from being made on time. WVGCHVPOONJP—‘OQOWVQU'vQDMb-‘O 34. By engaging in this conduct, Sha intended to disrupt these relationships. 35. These relationships were disrupted in that Sha’s actions caused these customers to scale back or cease doing business with SP1. 36. SP1 was harmed, in that it lost prospective income from these customers. 37. Sha’s conduct was a substantial factor in causing SPI’s harm. 38. SP1 is informed and believes, and on that basis alleges, that Sha’s outrageous conduct was malicious and oppressive, and done with a conscious disregard of its rights, and with the intent to injure the company. Specifically, SP1 is informed and believes, and on that basis alleges, that afterJanuary 2016, Sha took actions that were inimical to the best interests -5- Complaint for Business Torts )—l of the company with the intent to cause it to lose customers and go out of business. Thus, SPI seeks an award of punitive and exemplary damages in an amount according to proof. FOURTH CAUSE OF ACTION FOR NEGLIGENT INTERFERENCE WITH ©CDVO§O1>POOKD PROSPECTIVE ECONOMIC ADVANTAGE (Against Solomon Sha) 39. SP1 restates and incorporates by this reference, as if fully set forth herein, each and every allegation contained in paragraphs 1 through 16 of this complaint. 40- SPI had economic relationships with various customers that probably would have resulted in a future economic benefit to SPI, including, but not limited to, Fountain Café 2113 in Oakland; Grand Hyatt San Francisco; Courtyard by Marriott San Francisco Downtown; the 94404 Suite Holiday Inn San Jose; and Team SanJose at the San Jose Convention Center and Visitors Corporation Bureau. Blvd., California CENTER 41. Sha knew or should have known of these relationships. LAW City, Hillsdale Professional 42. Sha knew or should have known that these relationships would be disrupted if E. Foster he failed to act with reasonable care. A 1291 43. Sha failed to act with reasonable care in failing to ensure that the departments wwwmwwwwwD—‘D—‘HHD—‘b—IHHHD—l responsible for distributing SPI’s goods were adequately staffed; and in failing to ensure that deadlines for early—morning customer deliveries were met. mfloim-ODMHOQCCDVQOWFPWMHO 44. Sha engaged in wrongful conduct by breaching his fiduciary duty to use reasonable care, and his fiduciary duty of loyalty, resulting, among other things, in the departments responsible for distributing SPI’s goods being chronically understaffed; and deadlines for early-morning customer deliveries being repeatedly missed. 45. These relationships were disrupted in that Sha’s actions caused these customers to scale back or cease doing business with SP1. 46. SP1 was harmed, in that it lost prospective income from these customers. 47. Sha’s wrongful conduct was a substantial factor in causing SPI’s harm. /// _ 7 _ Complaint for Business Torts WHEREFORE, SWEET PRODUCTION, INC. PRAYS FORJUDGMENT AGAINST DEFENDANTS, AND EACH OF THEM, AS FOLLOWS: 1. For compensatory damages, including, but not limited to, the amounts lost for— paying wages and liabilities for falsified employee time records, and prospective income from customers who scaled back or ceased {DmflOflU‘ltFuOJNJH doing business with SP1, in an amount that exceeds the Court’s jurisdictional minimum and according to proof; 2. For consequential damages, according to proof; 3. For punitive damages on the First and Third Causes of Action, according to Y proof; 4. For an award of interest, including prejudgment interest, at the legal rate; 2113 5. For costs incurred by Sweet Production, Inc. in prosecuting this action; and 94404 Suite 6'. For such other and further relief as this Court deems just and proper. Corporation Blvd., California CENTER Datedzjune 15, 2018 LAW CENTER City, Hillsdale A Professional Corporation Professional LAW A E. Foster .mmmHHHHs—‘HHHH CIUWQM" Andrew M. A a 1291 Attorney for Plaintiff Swee roduction, Inc. -8- Complaint for Business Torts )_A REQUEST FOR IURY TRIAL Plaintiff Sweet Production, Inc. hereby demands trial by jury against Defendant Solomon Sha, and Does I to 10, in this action. Datedzjune 15, 2018 LAW CENTER COCDVOSU‘IQOJM A Professional Corporation 1 /’d Andrew M. Ag Attorney for Plaintiff Swee roduction, Inc. 2113 94404 Suite Corporation Blvd., California CENTER City, Professional I-Iillsdale LAW E.Foster A MMMMMMMD—Ir—‘b—ib—Ib—tb—tr—Ab—Ir—AH 1291 gEDIQQ'lvPWMP—‘OQDWVQWVPWNJHO -9- Complaint for Business Torts