Preview
1 Brian P. Rigonan, SBN 213226 9/11/2020
BPR LAW GROUP
2 750 Menlo Avenue, Suite 250
Menlo Park, CA 94025
3 Telephone: 650.704.7641
Fax: 650.989.1318
4 Email: brian.rigonan@bprlawgroup.com
5 Attorney for Plaintiff and Cross-Defendant
VIDA CAPITAL GROUP, LLC
6
SUPERIOR COURT OF THE STATE OF CALIFORNIA
7
COUNTY OF SAN MATEO
8
VIDA CAPITAL GROUP, LLC, a Case No.: 17-CLJ-00575
9 California limited liability company,
Limited Civil Case Reclassified by Cross-
10 Plaintiff, Complaint as an Unlimited Civil Case
11 v. VIDA CAPITAL GROUP, LLC’S BRIEF
OPPOSING DEFENDANTS AND CROSS-
12 MASTAR PROFESSIONAL CORP., a COMPLAINANTS’ MOTION FOR ENTRY
California corporation et al., OF JUDGMENT OF DISMISSAL
13 PURSUANT TO SETTLEMENT
Defendants. AGREEMENT
14
Date: September 24, 2020
15 Time: 1:30 pm
Location: Law and Motion
16
Action Filed: February 8, 2017
17 AND RELATED CROSS ACTIONS Trial Date: N/A
18
19 By and through its attorney of record, plaintiff and cross-defendant Vida Capital Group,
20 LLC (“Vida”) submits this opposition brief opposing defendants and cross-complainants’
21 (collectively “Woodland Glory”) motion to dismiss the current action.
22 I. INTRODUCTION
23 Vida, first and foremost, requests that the Court postpone ruling on Woodland Glory’s
24 motion until October 27, 2020, which is the date scheduled for Vida’s motion to enforce the same
25 settlement agreement at issue in the current motion. The issues in dispute as part of the current
26 motion are essentially the same issues in dispute in Vida’s motion. Consequently, if the Court
27 does not postpone ruling on the present motion, it may essentially have to consider the same
28 issues twice. Obviously this is inefficient. Therefore, to preserve limited judicial resources—
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VIDA CAPITAL GROUP, LLC’S OPP. TO DEFS. AND CROSS-COMPLAINANTS’ MOTION TO DISMISS
1 especially during a global pandemic when the Court is overly burdened—Vida contends that
2 consolidating both motions into a single hearing is the most economical use of judicial resources.
3 Also important, if the Court accepts Vida’s proposal to consolidate the present motion with
4 Vida’s motion, into a single hearing scheduled for October 27, 2020, the Court must vacate its
5 October 6, 2020 hearing to dismiss the current action.
6 The substance of Vida’s opposition: the Court must deny Woodland Glory’s motion
7 because prior to filing it, Woodland Glory breached the settlement agreement at issue three
8 separate times. The first occurred before the January 31, 2020 deadline to dismiss that Woodland
9 Glory emphasizes in its motion; the second occurred February 5, 2020—just five days after the
10 January 31, 2020 deadline; and the third occurred in May 2020. All of these breaches happened
11 months before Woodland Glory filed its motion. Woodland Glory, therefore, cannot enforce an
12 agreement that it previously breached. Hence, the Court must deny the motion.
13 And if the Court agrees with Vida’s position, it must award Vida “prevailing party”
14 reasonable attorney’s fees and costs of $2,279.12 for having to oppose Woodland Glory’s motion.
15 Alternatively, if the Court finds Woodland Glory’s motion persuasive, Woodland Glory’s
16 “prevailing party” attorney’s fees and costs request is excessive. Therefore, if the Court is
17 inclined to grant Woodland Glory’s motion—which Vida vociferously argues it should not—the
18 Court should significantly decrease any award of attorney’s fees and costs.
19 II. RELEVANT BACKGROUND FACTS
20 A. The Parties’ Disputes Date Back to 2015.
21 While the parties entered into the settlement at issue to resolve the current lawsuit, which
22 was filed in February 2017, the disputes between them date back to when Woodland Glory
23 purchased the mobile home park at issue (the “Park”) in February 2015. [Declaration of Malcolm
24 Durham in Support of Vida Capital Group, LLC’s Brief Opposing Defendants and Cross-
25 Complainants’ Motion for Entry of Judgment of Dismissal Pursuant to Settlement Agreement
26 (“Durham Dec.”) at ¶ 4.] Within weeks of purchasing the Park, Woodland Glory began wrongly
27 asserting that it owned rental units Vida owned. [Id. at ¶ 5.] Based on their inaccurate claims,
28 Woodland Glory illegally demanded that residents and the County of San Mateo Housing
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VIDA CAPITAL GROUP, LLC’S OPP. TO DEFS. AND CROSS-COMPLAINANTS’ MOTION TO DISMISS
1 Authority (“Housing Authority”) pay rent to Woodland Glory. [Id.] (The Housing Authority
2 pays a portion of the rent for some of the low-income individuals who occupy some of Vida’s
3 rental units.) [Id.] Woodland Glory’s wrongful conduct went as far as changing a rent check
4 made payable to Vida so that it became payable to a management company Woodland Glory
5 controlled, and then cashing the check. [Id.] In a number of lawsuits from 2015, Vida
6 successfully defeated Woodland Glory’s attempts to redirect rent payments to itself; and in a
7 small-claims lawsuit in 2019, Vida obtained money damages against some of Woodland Glory’s
8 individual owners for tampering with the above mentioned rent payment. [Id. at ¶¶ 5-10.]
9 B. Woodland Glory Aggressively Litigated the Current Lawsuit.
10 Woodland Glory litigated the present lawsuit aggressively. For example, less than a
11 month after filing its answer and cross complaint, Woodland Glory filed a preliminary injunction
12 motion. [Vida Capital Group, LLC’s Request for Judicial Notice in Support of Its Brief Opposing
13 Defendants and Cross-Complainants’ Motion for Entry of Judgment of Dismissal Pursuant to
14 Settlement Agreement (“RJN”) Ex. A.] Likewise, in September 2018 Woodland Glory filed a
15 motion seeking to dismiss the present suit. [RJN at Ex. B.] Both of these motions failed. [RJN
16 at Ex. C & D.] Subsequently, as part of discovery Woodland Glory refused to allow depositions
17 of its members involved in the Park’s purchase and management, refused to allow certain “Person
18 Most Knowledgeable” depositions, and stonewalled Vida’s attempts to obtain documents,
19 including a May 2019 Conversion Impact Report (“CIR”) submitted by Woodland Glory to East
20 Palo Alto (“EPA”) pursuant to local ordinances regulating the Park’s conversion. [Declaration of
21 Brian P. Rigonan in Support of Vida Capital Group, LLC’s Brief Opposing Defendants and
22 Cross-Complainants’ Motion for Entry of Judgment of Dismissal Pursuant to Settlement
23 Agreement (“Rigonan Dec.”) at ¶ 3.] Woodland Glory justified its conduct concerning the CIR
24 by arguing that it was a “first administrative draft of the CIR.” [Id.]
25 As a result, among other actions, Vida filed multiple motions to compel and filed a motion
26 to move the trial date so that the motions to compel could be heard before trial. [Rigonan Dec. at
27 ¶ 4.] The Court granted Vida’s motion to move the trial date. [RJN at Ex. E.] Vida’s motions to
28 compel, however, were never ruled upon because the parties stipulated to certain discovery
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VIDA CAPITAL GROUP, LLC’S OPP. TO DEFS. AND CROSS-COMPLAINANTS’ MOTION TO DISMISS
1 extensions, and the reopening of discovery for limited purposes, but then settled the case prior to
2 having to undergo the discovery contemplated in the parties’ stipulation. [Rigonan Dec. at ¶ 4.]
3 It is because of the multiple lawsuits from 2015, and the aggressive manner in which
4 Woodland Glory litigated the present lawsuit—including the stonewalling of the May 2019 “draft
5 CIR”—that Vida demanded that the settlement require Woodland Glory to obey EPA’s local
6 ordinances and the Mobilehome Residency Law (“MRL”) (i.e., California Civil Code sections
7 798 et seq.) in how it managed the Park’s conversion and its day-to-day operation. [Durham Dec.
8 at ¶¶ 11-12.]
9 C. Relevant Terms in the Parties’ Settlement Agreement.
10 The settlement at issue contains the following relevant provisions. First, paragraph 1(f)
11 permits Vida to receive copies of appraisals Woodland Glory obtained and submitted to EPA for
12 rental units in the Park that Vida gave up as part of the settlement. [Durham Dec. at ¶ 13; Ex. 4;
13 page 3.] Second, paragraph 5 states that the lawsuit at issue must be dismissed “provided that all
14 terms and conditions of this Agreement have been complied with.” (emphasis added) [Id. at
15 ¶ 13; Ex. 4; page 4.] Third, paragraph 9 requires Woodland Glory to obey EPA’s local
16 ordinances and the MRL in how it manages the Park’s conversion and its day-to-day operation.
17 [Id.] Fourth, paragraph 10 provides for reasonable attorney’s fees and costs to the prevailing
18 party in a motion to enforce the agreement. [Id. at ¶ 13; Ex. 4; page 5.]
19 D. Relevant Portions of EPA’s Municipal Code.
20 Chapter 14.19 et seq. of EPA’s municipal code lays out the specific steps Woodland Glory
21 must follow to convert the Park to a use other than as a mobile home park. [RJN at Ex. G.]
22 These steps include the requirements in sections 14.19.030 and 14.19.050. [Id. at pages 6-9 &
23 10-11.] Among other things, section 14.19.030(A) instructs that when an owner seeks permission
24 to convert a mobile home park, it must submit an application. [Id. at page 6.] Additionally,
25 “[t]he application shall include the report required by Government Code section 65863.7
26 (‘conversion impact report’) and a confidential resident questionnaire.” (emphasis added and
27 internal quotes in origin) [Id.] The same paragraph goes on to state that:
28 No mobilehome park shall undergo a change of use until a permit therefor
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VIDA CAPITAL GROUP, LLC’S OPP. TO DEFS. AND CROSS-COMPLAINANTS’ MOTION TO DISMISS
1 has been approved by [EPA]. No application for said permit shall be
2 deemed complete until aa (sic) completed resident questionnaire (for each
3 affected mobile home owner and resident) and conversion impact report
4 have been filed with [EPA]. [Id.]
5 While section 14.19.030 states that the resident questionnaire must be confidential, it does not
6 give that same status to the CIR. Likewise, this section does not allow for a park owner to submit
7 a “draft” CIR or “administrative draft CIR.”
8 The same is true for section 14.19.050. Section 14.19.050(A) states: “At the same time
9 the applicant files an application for a change of use pursuant to Subsection (A) of Section
10 14.19.030 of this Chapter, he or she shall transmit a copy of the conversion impact report to all
11 mobilehome residents.” [RJN at Ex. G at page 10.] Again, there is no language allowing for a
12 “draft” CIR; nor is there any language that makes a CIR submitted by a park owner to EPA
13 confidential, or otherwise prevents disclosure to the public.
14 E. Woodland Glory Submits a Purported “Second Administrative Draft CIR.”
15 In November 2019, about 2 months after the settlement at issue, Woodland Glory
16 submitted a document that it referred to as a “second administrative CIR” without disclosing it to
17 Vida or any other member of the public. [Durham Dec. at ¶ 14.] Vida viewed this behavior as
18 violating EPA’s local ordinance, and voiced its objections via two different emails to EPA in
19 mid-January 2020. [Id.] Thus, when Woodland Glory requested on January 30, 2020 that Vida
20 agree to dismiss the present lawsuit, Vida intentionally did not respond because, from Vida’s
21 perspective, Woodland Glory breached the settlement by submitting a “second administrative
22 CIR” without concurrently providing a copy to Vida or any of the other residents in the Park.
23 [Durham Dec. at ¶ 15.] And had Woodland Glory followed up its January 30, 2020 request and
24 insisted that Vida agree to dismiss the present action, Vida would have refused. [Id.]
25 F. In February 2020, and Again in May and June 2020, Woodland Glory
26 Refused to Allow Vida an “On-Site” Sale of One of Its Units.
27 In January 2020 Vida put one of its units for sale on the open market, and as required by
28 the terms of its lease, advised Woodland Glory about the listing. [Durham Dec. at ¶ 16.]
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VIDA CAPITAL GROUP, LLC’S OPP. TO DEFS. AND CROSS-COMPLAINANTS’ MOTION TO DISMISS
1 Woodland Glory immediately responded and advised that because the Park is closing, it would
2 not offer a lease to any buyer, and therefore, if Vida’s unit is sold it must be an “off-site” sale
3 rather than an “on-site” sale. [Durham Dec. at ¶ 17.] Woodland Glory also offered to
4 immediately negotiate for the purchase of all of Vida’s rental units. [Id.] This issue arose again
5 in May 2020 when Vida obtained an interested buyer, and Woodland Glory re-asserted its
6 position. [Id.]
7 In plain language, Woodland Glory’s position about “on-site” and “off-site” sales means
8 that if Vida obtained a buyer for a unit, the buyer would not be given a lease that would allow the
9 buyer to keep the unit in the Park, i.e., an “on-site” sale; consequently, the unit would have to be
10 removed from the Park as part of the sale, i.e., an “off-site” sale. One of the appraisals Vida
11 received as part of the settlement shows that for one of the units Vida gave up as part of the
12 settlement, its fair market value decreased by more than 90% if an “off-site” sale was assumed.
13 [Durham Dec. at ¶ 18.] In other words, this appraisal shows that essentially all of the value of
14 Vida’s rental units is based on the leasehold right; and once that is excluded, the values became
15 de minimis. [Id.] Thus, Woodland Glory knew that for all practical purposes, preventing any
16 “on-site” sales made Vida’s units worthless. [Id.] So Woodland Glory forced an “off-site” sale
17 to effectively destroy the marketability of Vida’s rental units. [Id.] And then it made an offer to
18 purchase all of Vida’s units knowing full well that its actions limited their marketability to only
19 Woodland Glory. [Id.] In other words, Woodland Glory manipulated its market power to create
20 a monopoly, and then made a falsely magnanimous offer to purchase Vida’s units.
21 On May 18, 2020 Vida explained to Woodland Glory that its conduct violated the MRL.
22 [Durham Dec. at ¶ 19.] Woodland Glory responded on May 26, 2020, but did not explain how its
23 conduct obeyed the MRL. [Id.] Woodland Glory repeated its position on June 24, 2020, but still
24 did not explain how its conduct squared with the MRL. [Id.]
25 G. Vida Gave Notice to Woodland Glory of Its Breaches.
26 On July 9, 2020 Vida formally put Woodland Glory on notice of its multiple breaches of
27 the settlement. [Rigonan Dec. at ¶ 5.] Woodland Glory responded on July 18, 2020 but did not
28 address any of the breaches. [Id.] Instead, Woodland Glory demanded that Vida agree to dismiss
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VIDA CAPITAL GROUP, LLC’S OPP. TO DEFS. AND CROSS-COMPLAINANTS’ MOTION TO DISMISS
1 the case pursuant to paragraph 5 of the settlement. [Id.] Vida responded on July 24, 2020
2 explaining that paragraph 5 did not apply because of the November 2019 violation of EPA’s local
3 ordinances via Woodland Glory’s submission of its “second administrative CIR” without
4 disclosing it to Vida. [Id.] Vida also proposed that the parties meet and confer about the
5 situation. [Id.] That same day, Woodland Glory responded and, among other things, argued that
6 Vida “never made this assertion [about violating EPA’s local ordinances] until many months after
7 the case should have been dismissed, and there is no merit to this contention in any event.” [Id.]
8 III. LEGAL ARGUMENT
9 A. Woodland Glory’s Submission of Its November 2019 Purported “Second
10 Administrative Draft CIR” Violated EPA’s Local Ordinances.
11 As indicated above, the settlement at issue requires Woodland Glory to obey EPA’s local
12 ordinances relating to its conversion of the Park. And these ordinances mandate that a park
13 owner must submit a CIR at the same time it submits a change of use application; likewise,
14 delivery of a CIR to mobile home park residents must happen at the same time a park owner files
15 a change of use application. Nowhere do the ordinances allow a park owner to submit a “draft
16 CIR” or an “administrative draft CIR.” Thus, Woodland Glory submitting a “second
17 administrative draft CIR” without providing a copy to Vida, or any other Park residents, violates
18 EPA’s ordinances.
19 B. Woodland Glory’s Refusal to Permit an “On-Site” Sale Violates the MRL.
20 Woodland Glory’s refusal to permit Vida the opportunity to even attempt an “on-site” sale
21 of one of its units violates the MRL. As long as a “homeowner” (defined by the MRL as a party
22 that has a tenancy in a mobile home park under a rental agreement) has a valid tenancy, the MRL
23 allows that party to sell its unit(s) “on-site.” Further, pursuant to Civil Code § 798.56 (g)(2),
24 unless and until a “change of use” is approved by the local government (in this case EPA
25 approving closure of the Park) and a six-month notice of termination of tenancy is provided, a
26 homeowner such as Vida has the right to effectuate an “on-site” sale of any unit located within a
27 mobile home park, and the park owner must offer a tenancy application to any prospective buyer,
28 and consider, in good faith, the application from the perspective buyer. Put differently, if either
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VIDA CAPITAL GROUP, LLC’S OPP. TO DEFS. AND CROSS-COMPLAINANTS’ MOTION TO DISMISS
1 no “change of use” has been approved by the local government or a “six-month notice of
2 termination” has not been provided, § 798.56(g)(2) prevents a park owner from disallowing an
3 “on-site” sale. In the present case, Vida contends that neither requirement has been met. In their
4 communications on this issue, Woodland Glory seemingly argues that EPA sua sponte approved
5 a “change of use” for the Park. While Vida vehemently disagrees with this position, even if one
6 assumes this fact arguendo, it is undisputable that Woodland Glory has never provided the “six-
7 month notice of termination.” As a result, Vida’s tenancy cannot legally be terminated at least
8 until such a notice is provided; and under the MRL, the termination of Vida’s tenancy is the legal
9 threshold for Woodland Glory to deny Vida the ability to effectuate an “on-site” sale.
10 Additionally, pursuant to Civil Code § 798.74(a), a park owner cannot withhold approving
11 a prospective buyer unless the buyer lacks the financial ability to pay the rent and other charges of
12 the park, or if there is a likelihood that the buyer will not comply with park’s rules and regulations
13 based upon prior tenancies. Here, when Woodland Glory forced an “off-site” sale, it did not
14 reference any of § 798.74(a)’s factors; rather, it claimed that it had no duty to allow an “on-site”
15 sale because the Park was undergoing a conversion. This position violates the MRL.
16 C. Woodland Glory’s Conduct Breached the Settlement.
17 As demonstrate by the above arguments, Woodland Glory violated both EPA’s local
18 ordinances, and the MRL; and therefore, breached the settlement at issue. Further, Vida contends
19 that the first breach occurred before the January 31, 2020 deadline to dismiss. But even if the
20 Court disagrees that Woodland Glory’s “second administrative CIR” breached the settlement, it is
21 undeniable that Vida subjectively believed this to be a breach; and consequently, intentionally did
22 not respond to Woodland Glory’s January 30, 2020 request to dismiss. This is demonstrated by
23 the two mid-January 2020 emails to EPA from Vida, both of which were before Woodland
24 Glory’s January 30, 2020 request to dismiss the case. And these emails support Vida’s assertion
25 that had Woodland Glory followed up its January 30, 2020 email and insisted that Vida agree to
26 dismiss the present action, Vida would have refused. Moreover, it is also undeniable that on
27 February 5, 2020—just five days after January 31, 2020—Woodland Glory violated the MRL by
28 refusing to permit an “on-site” sale, thereby again breaching the settlement.
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VIDA CAPITAL GROUP, LLC’S OPP. TO DEFS. AND CROSS-COMPLAINANTS’ MOTION TO DISMISS
1 But it is important to note that Woodland Glory never did follow up on its January 30,
2 2020 email request to dismiss. In fact, Woodland Glory did not raise the issue until Vida put it on
3 notice about its breaches. It was only then—after it breached three separate times—that
4 Woodland Glory belatedly sought to enforce the settlement’s dismissal clause. It is contracts 101
5 that a party cannot seek to enforce an agreement it has already breached. Consequently, the
6 Court must deny Woodland Glory’s motion.
7 D. The “Prevailing Party” Attorney’s Fees and Costs Woodland Glory Seeks Are
8 Excessive.
9 In its motion, Woodland Glory requests $9,814 in “prevailing party” attorney’s fees and
10 costs. Pursuant to the supporting declaration of Woodland Glory’s attorney Breck E. Milde, this
11 amount is based on a purported 13.8 hours of attorney time at a billable rate of $575 per hour,
12 plus filing fees and CourtCall fees. Mr. Milde’s declaration, however, provides no objective
13 information to support his claim that $575 per hour “is commensurate with billing rates charged
14 by attorneys with my level of experience and who have similar practices in this geographic area.”
15 In comparison, Vida’s attorney, who has a similar level of education and work experience, only
16 charges $275 per hour. Also relevant, 13.8 hours of attorney time is excessive for a motion that
17 essentially argues that because a settlement agreement required dismissal of an action by January
18 31, 2020, the Court should dismiss the action. While Vida vociferously contends that the Court
19 should deny Woodland Glory’s motion, if the Court is inclined to grant it, at a minimum it should
20 only award reasonable attorney’s fees and costs to Woodland Glory. And Vida contends that a
21 reasonable billable rate is the same Vida’s attorney charges: $275. Additionally, Vida contends
22 that because the issue argued by Woodland Glory is basic, at most the reasonable amount of
23 attorney time is no more than that expounded by Vida’s attorney in writing this opposition, i.e.,
24 7.9 hours.
25 E. Vida Incurred Attorney’s Fees and Costs in Bringing This Opposition.
26 As demonstrated by the concurrently filed declaration of Vida’s counsel, Brian P.
27 Rigonan, Vida incurred $2,279.12 in attorney’s fees and cost relating to the draft and filing of this
28 opposition, and CourtCall fees. [Rigonan Dec. at ¶¶ 7-10.]
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VIDA CAPITAL GROUP, LLC’S OPP. TO DEFS. AND CROSS-COMPLAINANTS’ MOTION TO DISMISS
1 IV. CONCLUSION
2 The above demonstrates that Woodland Glory breached the settlement at issue multiple
3 times before filing the present motion. Further, (a) the first breach occurred before the January
4 31, 2020 deadline to dismiss this case, (b) the second breach occurred just five days after this
5 deadline, and (c) both were months prior to July 24, 2020 when Woodland Glory filed the present
6 motion. Consequently, the Court must deny the present motion because Woodland Glory cannot
7 enforce an agreement it breached multiple months prior. And because the Court must deny
8 Woodland Glory’s motion, it must also award Vida “prevailing party” reasonable attorney’s fee
9 and cost of $2,279.12. Alternatively, if the Court finds Woodland Glory’s motion persuasive, at a
10 minimum it should significantly decrease any award of attorney’s fees and costs to Woodland
11 Glory.
12 Dated: September 11, 2020 BPR LAW GROUP
13
By:
14 Brian P. Rigonan
Attorney for Plaintiff and Cross-Defendant
15 VIDA CAPITAL GROUP, LLC
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VIDA CAPITAL GROUP, LLC’S OPP. TO DEFS. AND CROSS-COMPLAINANTS’ MOTION TO DISMISS
1 IV. CONCLUSION
2 The above demonstrates that Woodland Glory breached the settlement at issue multiple
3 times before filing the present motion. Further, (a) the first breach occurred before the January
4 31, 2020 deadline to dismiss this case, (b) the second breach occurred just five days after this
5 deadline, and (c) both were months prior to July 24, 2020 when Woodland Glory filed the present
6 motion. Consequently, the Court must deny the present motion because Woodland Glory cannot
7 enforce an agreement it breached multiple months prior. And because the Court must deny
Woodland Glory's motion, it must also award Vida "prevailing party" reasonable attorney's fee
9 and cost of $2,279.12. Alternatively, if the Court finds Woodland Glory's motion persuasive, at a
10 minimum it should significantly decrease any award of attorney's fees and costs to Woodland
11 Glory.
12 Dated: September 11, 2020 BPR LAW GROUP
13
By:
14 Brian P. _
Attorney for Plaintiff and Cross-Defendant
15 VIDA CAPITAL GROUP, LLC
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VIDA CAPITAL GROUP, LLC'S OPP. TO DBFS. AND CROSS-COMPLAINANTS' MOTION TO DISMISS
Preview
1 Brian P. Rigonan, SBN 213226 9/11/2020 BPR LAW GROUP 2 750 Menlo Avenue, Suite 250 Menlo Park, CA 94025 3 Telephone: 650.704.7641 Fax: 650.989.1318 4 Email: brian.rigonan@bprlawgroup.com 5 Attorney for Plaintiff and Cross-Defendant VIDA CAPITAL GROUP, LLC 6 SUPERIOR COURT OF THE STATE OF CALIFORNIA 7 COUNTY OF SAN MATEO 8 VIDA CAPITAL GROUP, LLC, a Case No.: 17-CLJ-00575 9 California limited liability company, Limited Civil Case Reclassified by Cross- 10 Plaintiff, Complaint as an Unlimited Civil Case 11 v. VIDA CAPITAL GROUP, LLC’S BRIEF OPPOSING DEFENDANTS AND CROSS- 12 MASTAR PROFESSIONAL CORP., a COMPLAINANTS’ MOTION FOR ENTRY California corporation et al., OF JUDGMENT OF DISMISSAL 13 PURSUANT TO SETTLEMENT Defendants. AGREEMENT 14 Date: September 24, 2020 15 Time: 1:30 pm Location: Law and Motion 16 Action Filed: February 8, 2017 17 AND RELATED CROSS ACTIONS Trial Date: N/A 18 19 By and through its attorney of record, plaintiff and cross-defendant Vida Capital Group, 20 LLC (“Vida”) submits this opposition brief opposing defendants and cross-complainants’ 21 (collectively “Woodland Glory”) motion to dismiss the current action. 22 I. INTRODUCTION 23 Vida, first and foremost, requests that the Court postpone ruling on Woodland Glory’s 24 motion until October 27, 2020, which is the date scheduled for Vida’s motion to enforce the same 25 settlement agreement at issue in the current motion. The issues in dispute as part of the current 26 motion are essentially the same issues in dispute in Vida’s motion. Consequently, if the Court 27 does not postpone ruling on the present motion, it may essentially have to consider the same 28 issues twice. Obviously this is inefficient. Therefore, to preserve limited judicial resources— -1- VIDA CAPITAL GROUP, LLC’S OPP. TO DEFS. AND CROSS-COMPLAINANTS’ MOTION TO DISMISS 1 especially during a global pandemic when the Court is overly burdened—Vida contends that 2 consolidating both motions into a single hearing is the most economical use of judicial resources. 3 Also important, if the Court accepts Vida’s proposal to consolidate the present motion with 4 Vida’s motion, into a single hearing scheduled for October 27, 2020, the Court must vacate its 5 October 6, 2020 hearing to dismiss the current action. 6 The substance of Vida’s opposition: the Court must deny Woodland Glory’s motion 7 because prior to filing it, Woodland Glory breached the settlement agreement at issue three 8 separate times. The first occurred before the January 31, 2020 deadline to dismiss that Woodland 9 Glory emphasizes in its motion; the second occurred February 5, 2020—just five days after the 10 January 31, 2020 deadline; and the third occurred in May 2020. All of these breaches happened 11 months before Woodland Glory filed its motion. Woodland Glory, therefore, cannot enforce an 12 agreement that it previously breached. Hence, the Court must deny the motion. 13 And if the Court agrees with Vida’s position, it must award Vida “prevailing party” 14 reasonable attorney’s fees and costs of $2,279.12 for having to oppose Woodland Glory’s motion. 15 Alternatively, if the Court finds Woodland Glory’s motion persuasive, Woodland Glory’s 16 “prevailing party” attorney’s fees and costs request is excessive. Therefore, if the Court is 17 inclined to grant Woodland Glory’s motion—which Vida vociferously argues it should not—the 18 Court should significantly decrease any award of attorney’s fees and costs. 19 II. RELEVANT BACKGROUND FACTS 20 A. The Parties’ Disputes Date Back to 2015. 21 While the parties entered into the settlement at issue to resolve the current lawsuit, which 22 was filed in February 2017, the disputes between them date back to when Woodland Glory 23 purchased the mobile home park at issue (the “Park”) in February 2015. [Declaration of Malcolm 24 Durham in Support of Vida Capital Group, LLC’s Brief Opposing Defendants and Cross- 25 Complainants’ Motion for Entry of Judgment of Dismissal Pursuant to Settlement Agreement 26 (“Durham Dec.”) at ¶ 4.] Within weeks of purchasing the Park, Woodland Glory began wrongly 27 asserting that it owned rental units Vida owned. [Id. at ¶ 5.] Based on their inaccurate claims, 28 Woodland Glory illegally demanded that residents and the County of San Mateo Housing -2- VIDA CAPITAL GROUP, LLC’S OPP. TO DEFS. AND CROSS-COMPLAINANTS’ MOTION TO DISMISS 1 Authority (“Housing Authority”) pay rent to Woodland Glory. [Id.] (The Housing Authority 2 pays a portion of the rent for some of the low-income individuals who occupy some of Vida’s 3 rental units.) [Id.] Woodland Glory’s wrongful conduct went as far as changing a rent check 4 made payable to Vida so that it became payable to a management company Woodland Glory 5 controlled, and then cashing the check. [Id.] In a number of lawsuits from 2015, Vida 6 successfully defeated Woodland Glory’s attempts to redirect rent payments to itself; and in a 7 small-claims lawsuit in 2019, Vida obtained money damages against some of Woodland Glory’s 8 individual owners for tampering with the above mentioned rent payment. [Id. at ¶¶ 5-10.] 9 B. Woodland Glory Aggressively Litigated the Current Lawsuit. 10 Woodland Glory litigated the present lawsuit aggressively. For example, less than a 11 month after filing its answer and cross complaint, Woodland Glory filed a preliminary injunction 12 motion. [Vida Capital Group, LLC’s Request for Judicial Notice in Support of Its Brief Opposing 13 Defendants and Cross-Complainants’ Motion for Entry of Judgment of Dismissal Pursuant to 14 Settlement Agreement (“RJN”) Ex. A.] Likewise, in September 2018 Woodland Glory filed a 15 motion seeking to dismiss the present suit. [RJN at Ex. B.] Both of these motions failed. [RJN 16 at Ex. C & D.] Subsequently, as part of discovery Woodland Glory refused to allow depositions 17 of its members involved in the Park’s purchase and management, refused to allow certain “Person 18 Most Knowledgeable” depositions, and stonewalled Vida’s attempts to obtain documents, 19 including a May 2019 Conversion Impact Report (“CIR”) submitted by Woodland Glory to East 20 Palo Alto (“EPA”) pursuant to local ordinances regulating the Park’s conversion. [Declaration of 21 Brian P. Rigonan in Support of Vida Capital Group, LLC’s Brief Opposing Defendants and 22 Cross-Complainants’ Motion for Entry of Judgment of Dismissal Pursuant to Settlement 23 Agreement (“Rigonan Dec.”) at ¶ 3.] Woodland Glory justified its conduct concerning the CIR 24 by arguing that it was a “first administrative draft of the CIR.” [Id.] 25 As a result, among other actions, Vida filed multiple motions to compel and filed a motion 26 to move the trial date so that the motions to compel could be heard before trial. [Rigonan Dec. at 27 ¶ 4.] The Court granted Vida’s motion to move the trial date. [RJN at Ex. E.] Vida’s motions to 28 compel, however, were never ruled upon because the parties stipulated to certain discovery -3- VIDA CAPITAL GROUP, LLC’S OPP. TO DEFS. AND CROSS-COMPLAINANTS’ MOTION TO DISMISS 1 extensions, and the reopening of discovery for limited purposes, but then settled the case prior to 2 having to undergo the discovery contemplated in the parties’ stipulation. [Rigonan Dec. at ¶ 4.] 3 It is because of the multiple lawsuits from 2015, and the aggressive manner in which 4 Woodland Glory litigated the present lawsuit—including the stonewalling of the May 2019 “draft 5 CIR”—that Vida demanded that the settlement require Woodland Glory to obey EPA’s local 6 ordinances and the Mobilehome Residency Law (“MRL”) (i.e., California Civil Code sections 7 798 et seq.) in how it managed the Park’s conversion and its day-to-day operation. [Durham Dec. 8 at ¶¶ 11-12.] 9 C. Relevant Terms in the Parties’ Settlement Agreement. 10 The settlement at issue contains the following relevant provisions. First, paragraph 1(f) 11 permits Vida to receive copies of appraisals Woodland Glory obtained and submitted to EPA for 12 rental units in the Park that Vida gave up as part of the settlement. [Durham Dec. at ¶ 13; Ex. 4; 13 page 3.] Second, paragraph 5 states that the lawsuit at issue must be dismissed “provided that all 14 terms and conditions of this Agreement have been complied with.” (emphasis added) [Id. at 15 ¶ 13; Ex. 4; page 4.] Third, paragraph 9 requires Woodland Glory to obey EPA’s local 16 ordinances and the MRL in how it manages the Park’s conversion and its day-to-day operation. 17 [Id.] Fourth, paragraph 10 provides for reasonable attorney’s fees and costs to the prevailing 18 party in a motion to enforce the agreement. [Id. at ¶ 13; Ex. 4; page 5.] 19 D. Relevant Portions of EPA’s Municipal Code. 20 Chapter 14.19 et seq. of EPA’s municipal code lays out the specific steps Woodland Glory 21 must follow to convert the Park to a use other than as a mobile home park. [RJN at Ex. G.] 22 These steps include the requirements in sections 14.19.030 and 14.19.050. [Id. at pages 6-9 & 23 10-11.] Among other things, section 14.19.030(A) instructs that when an owner seeks permission 24 to convert a mobile home park, it must submit an application. [Id. at page 6.] Additionally, 25 “[t]he application shall include the report required by Government Code section 65863.7 26 (‘conversion impact report’) and a confidential resident questionnaire.” (emphasis added and 27 internal quotes in origin) [Id.] The same paragraph goes on to state that: 28 No mobilehome park shall undergo a change of use until a permit therefor -4- VIDA CAPITAL GROUP, LLC’S OPP. TO DEFS. AND CROSS-COMPLAINANTS’ MOTION TO DISMISS 1 has been approved by [EPA]. No application for said permit shall be 2 deemed complete until aa (sic) completed resident questionnaire (for each 3 affected mobile home owner and resident) and conversion impact report 4 have been filed with [EPA]. [Id.] 5 While section 14.19.030 states that the resident questionnaire must be confidential, it does not 6 give that same status to the CIR. Likewise, this section does not allow for a park owner to submit 7 a “draft” CIR or “administrative draft CIR.” 8 The same is true for section 14.19.050. Section 14.19.050(A) states: “At the same time 9 the applicant files an application for a change of use pursuant to Subsection (A) of Section 10 14.19.030 of this Chapter, he or she shall transmit a copy of the conversion impact report to all 11 mobilehome residents.” [RJN at Ex. G at page 10.] Again, there is no language allowing for a 12 “draft” CIR; nor is there any language that makes a CIR submitted by a park owner to EPA 13 confidential, or otherwise prevents disclosure to the public. 14 E. Woodland Glory Submits a Purported “Second Administrative Draft CIR.” 15 In November 2019, about 2 months after the settlement at issue, Woodland Glory 16 submitted a document that it referred to as a “second administrative CIR” without disclosing it to 17 Vida or any other member of the public. [Durham Dec. at ¶ 14.] Vida viewed this behavior as 18 violating EPA’s local ordinance, and voiced its objections via two different emails to EPA in 19 mid-January 2020. [Id.] Thus, when Woodland Glory requested on January 30, 2020 that Vida 20 agree to dismiss the present lawsuit, Vida intentionally did not respond because, from Vida’s 21 perspective, Woodland Glory breached the settlement by submitting a “second administrative 22 CIR” without concurrently providing a copy to Vida or any of the other residents in the Park. 23 [Durham Dec. at ¶ 15.] And had Woodland Glory followed up its January 30, 2020 request and 24 insisted that Vida agree to dismiss the present action, Vida would have refused. [Id.] 25 F. In February 2020, and Again in May and June 2020, Woodland Glory 26 Refused to Allow Vida an “On-Site” Sale of One of Its Units. 27 In January 2020 Vida put one of its units for sale on the open market, and as required by 28 the terms of its lease, advised Woodland Glory about the listing. [Durham Dec. at ¶ 16.] -5- VIDA CAPITAL GROUP, LLC’S OPP. TO DEFS. AND CROSS-COMPLAINANTS’ MOTION TO DISMISS 1 Woodland Glory immediately responded and advised that because the Park is closing, it would 2 not offer a lease to any buyer, and therefore, if Vida’s unit is sold it must be an “off-site” sale 3 rather than an “on-site” sale. [Durham Dec. at ¶ 17.] Woodland Glory also offered to 4 immediately negotiate for the purchase of all of Vida’s rental units. [Id.] This issue arose again 5 in May 2020 when Vida obtained an interested buyer, and Woodland Glory re-asserted its 6 position. [Id.] 7 In plain language, Woodland Glory’s position about “on-site” and “off-site” sales means 8 that if Vida obtained a buyer for a unit, the buyer would not be given a lease that would allow the 9 buyer to keep the unit in the Park, i.e., an “on-site” sale; consequently, the unit would have to be 10 removed from the Park as part of the sale, i.e., an “off-site” sale. One of the appraisals Vida 11 received as part of the settlement shows that for one of the units Vida gave up as part of the 12 settlement, its fair market value decreased by more than 90% if an “off-site” sale was assumed. 13 [Durham Dec. at ¶ 18.] In other words, this appraisal shows that essentially all of the value of 14 Vida’s rental units is based on the leasehold right; and once that is excluded, the values became 15 de minimis. [Id.] Thus, Woodland Glory knew that for all practical purposes, preventing any 16 “on-site” sales made Vida’s units worthless. [Id.] So Woodland Glory forced an “off-site” sale 17 to effectively destroy the marketability of Vida’s rental units. [Id.] And then it made an offer to 18 purchase all of Vida’s units knowing full well that its actions limited their marketability to only 19 Woodland Glory. [Id.] In other words, Woodland Glory manipulated its market power to create 20 a monopoly, and then made a falsely magnanimous offer to purchase Vida’s units. 21 On May 18, 2020 Vida explained to Woodland Glory that its conduct violated the MRL. 22 [Durham Dec. at ¶ 19.] Woodland Glory responded on May 26, 2020, but did not explain how its 23 conduct obeyed the MRL. [Id.] Woodland Glory repeated its position on June 24, 2020, but still 24 did not explain how its conduct squared with the MRL. [Id.] 25 G. Vida Gave Notice to Woodland Glory of Its Breaches. 26 On July 9, 2020 Vida formally put Woodland Glory on notice of its multiple breaches of 27 the settlement. [Rigonan Dec. at ¶ 5.] Woodland Glory responded on July 18, 2020 but did not 28 address any of the breaches. [Id.] Instead, Woodland Glory demanded that Vida agree to dismiss -6- VIDA CAPITAL GROUP, LLC’S OPP. TO DEFS. AND CROSS-COMPLAINANTS’ MOTION TO DISMISS 1 the case pursuant to paragraph 5 of the settlement. [Id.] Vida responded on July 24, 2020 2 explaining that paragraph 5 did not apply because of the November 2019 violation of EPA’s local 3 ordinances via Woodland Glory’s submission of its “second administrative CIR” without 4 disclosing it to Vida. [Id.] Vida also proposed that the parties meet and confer about the 5 situation. [Id.] That same day, Woodland Glory responded and, among other things, argued that 6 Vida “never made this assertion [about violating EPA’s local ordinances] until many months after 7 the case should have been dismissed, and there is no merit to this contention in any event.” [Id.] 8 III. LEGAL ARGUMENT 9 A. Woodland Glory’s Submission of Its November 2019 Purported “Second 10 Administrative Draft CIR” Violated EPA’s Local Ordinances. 11 As indicated above, the settlement at issue requires Woodland Glory to obey EPA’s local 12 ordinances relating to its conversion of the Park. And these ordinances mandate that a park 13 owner must submit a CIR at the same time it submits a change of use application; likewise, 14 delivery of a CIR to mobile home park residents must happen at the same time a park owner files 15 a change of use application. Nowhere do the ordinances allow a park owner to submit a “draft 16 CIR” or an “administrative draft CIR.” Thus, Woodland Glory submitting a “second 17 administrative draft CIR” without providing a copy to Vida, or any other Park residents, violates 18 EPA’s ordinances. 19 B. Woodland Glory’s Refusal to Permit an “On-Site” Sale Violates the MRL. 20 Woodland Glory’s refusal to permit Vida the opportunity to even attempt an “on-site” sale 21 of one of its units violates the MRL. As long as a “homeowner” (defined by the MRL as a party 22 that has a tenancy in a mobile home park under a rental agreement) has a valid tenancy, the MRL 23 allows that party to sell its unit(s) “on-site.” Further, pursuant to Civil Code § 798.56 (g)(2), 24 unless and until a “change of use” is approved by the local government (in this case EPA 25 approving closure of the Park) and a six-month notice of termination of tenancy is provided, a 26 homeowner such as Vida has the right to effectuate an “on-site” sale of any unit located within a 27 mobile home park, and the park owner must offer a tenancy application to any prospective buyer, 28 and consider, in good faith, the application from the perspective buyer. Put differently, if either -7- VIDA CAPITAL GROUP, LLC’S OPP. TO DEFS. AND CROSS-COMPLAINANTS’ MOTION TO DISMISS 1 no “change of use” has been approved by the local government or a “six-month notice of 2 termination” has not been provided, § 798.56(g)(2) prevents a park owner from disallowing an 3 “on-site” sale. In the present case, Vida contends that neither requirement has been met. In their 4 communications on this issue, Woodland Glory seemingly argues that EPA sua sponte approved 5 a “change of use” for the Park. While Vida vehemently disagrees with this position, even if one 6 assumes this fact arguendo, it is undisputable that Woodland Glory has never provided the “six- 7 month notice of termination.” As a result, Vida’s tenancy cannot legally be terminated at least 8 until such a notice is provided; and under the MRL, the termination of Vida’s tenancy is the legal 9 threshold for Woodland Glory to deny Vida the ability to effectuate an “on-site” sale. 10 Additionally, pursuant to Civil Code § 798.74(a), a park owner cannot withhold approving 11 a prospective buyer unless the buyer lacks the financial ability to pay the rent and other charges of 12 the park, or if there is a likelihood that the buyer will not comply with park’s rules and regulations 13 based upon prior tenancies. Here, when Woodland Glory forced an “off-site” sale, it did not 14 reference any of § 798.74(a)’s factors; rather, it claimed that it had no duty to allow an “on-site” 15 sale because the Park was undergoing a conversion. This position violates the MRL. 16 C. Woodland Glory’s Conduct Breached the Settlement. 17 As demonstrate by the above arguments, Woodland Glory violated both EPA’s local 18 ordinances, and the MRL; and therefore, breached the settlement at issue. Further, Vida contends 19 that the first breach occurred before the January 31, 2020 deadline to dismiss. But even if the 20 Court disagrees that Woodland Glory’s “second administrative CIR” breached the settlement, it is 21 undeniable that Vida subjectively believed this to be a breach; and consequently, intentionally did 22 not respond to Woodland Glory’s January 30, 2020 request to dismiss. This is demonstrated by 23 the two mid-January 2020 emails to EPA from Vida, both of which were before Woodland 24 Glory’s January 30, 2020 request to dismiss the case. And these emails support Vida’s assertion 25 that had Woodland Glory followed up its January 30, 2020 email and insisted that Vida agree to 26 dismiss the present action, Vida would have refused. Moreover, it is also undeniable that on 27 February 5, 2020—just five days after January 31, 2020—Woodland Glory violated the MRL by 28 refusing to permit an “on-site” sale, thereby again breaching the settlement. -8- VIDA CAPITAL GROUP, LLC’S OPP. TO DEFS. AND CROSS-COMPLAINANTS’ MOTION TO DISMISS 1 But it is important to note that Woodland Glory never did follow up on its January 30, 2 2020 email request to dismiss. In fact, Woodland Glory did not raise the issue until Vida put it on 3 notice about its breaches. It was only then—after it breached three separate times—that 4 Woodland Glory belatedly sought to enforce the settlement’s dismissal clause. It is contracts 101 5 that a party cannot seek to enforce an agreement it has already breached. Consequently, the 6 Court must deny Woodland Glory’s motion. 7 D. The “Prevailing Party” Attorney’s Fees and Costs Woodland Glory Seeks Are 8 Excessive. 9 In its motion, Woodland Glory requests $9,814 in “prevailing party” attorney’s fees and 10 costs. Pursuant to the supporting declaration of Woodland Glory’s attorney Breck E. Milde, this 11 amount is based on a purported 13.8 hours of attorney time at a billable rate of $575 per hour, 12 plus filing fees and CourtCall fees. Mr. Milde’s declaration, however, provides no objective 13 information to support his claim that $575 per hour “is commensurate with billing rates charged 14 by attorneys with my level of experience and who have similar practices in this geographic area.” 15 In comparison, Vida’s attorney, who has a similar level of education and work experience, only 16 charges $275 per hour. Also relevant, 13.8 hours of attorney time is excessive for a motion that 17 essentially argues that because a settlement agreement required dismissal of an action by January 18 31, 2020, the Court should dismiss the action. While Vida vociferously contends that the Court 19 should deny Woodland Glory’s motion, if the Court is inclined to grant it, at a minimum it should 20 only award reasonable attorney’s fees and costs to Woodland Glory. And Vida contends that a 21 reasonable billable rate is the same Vida’s attorney charges: $275. Additionally, Vida contends 22 that because the issue argued by Woodland Glory is basic, at most the reasonable amount of 23 attorney time is no more than that expounded by Vida’s attorney in writing this opposition, i.e., 24 7.9 hours. 25 E. Vida Incurred Attorney’s Fees and Costs in Bringing This Opposition. 26 As demonstrated by the concurrently filed declaration of Vida’s counsel, Brian P. 27 Rigonan, Vida incurred $2,279.12 in attorney’s fees and cost relating to the draft and filing of this 28 opposition, and CourtCall fees. [Rigonan Dec. at ¶¶ 7-10.] -9- VIDA CAPITAL GROUP, LLC’S OPP. TO DEFS. AND CROSS-COMPLAINANTS’ MOTION TO DISMISS 1 IV. CONCLUSION 2 The above demonstrates that Woodland Glory breached the settlement at issue multiple 3 times before filing the present motion. Further, (a) the first breach occurred before the January 4 31, 2020 deadline to dismiss this case, (b) the second breach occurred just five days after this 5 deadline, and (c) both were months prior to July 24, 2020 when Woodland Glory filed the present 6 motion. Consequently, the Court must deny the present motion because Woodland Glory cannot 7 enforce an agreement it breached multiple months prior. And because the Court must deny 8 Woodland Glory’s motion, it must also award Vida “prevailing party” reasonable attorney’s fee 9 and cost of $2,279.12. Alternatively, if the Court finds Woodland Glory’s motion persuasive, at a 10 minimum it should significantly decrease any award of attorney’s fees and costs to Woodland 11 Glory. 12 Dated: September 11, 2020 BPR LAW GROUP 13 By: 14 Brian P. Rigonan Attorney for Plaintiff and Cross-Defendant 15 VIDA CAPITAL GROUP, LLC 16 17 18 19 20 21 22 23 24 25 26 27 28 -10- VIDA CAPITAL GROUP, LLC’S OPP. TO DEFS. AND CROSS-COMPLAINANTS’ MOTION TO DISMISS 1 IV. CONCLUSION 2 The above demonstrates that Woodland Glory breached the settlement at issue multiple 3 times before filing the present motion. Further, (a) the first breach occurred before the January 4 31, 2020 deadline to dismiss this case, (b) the second breach occurred just five days after this 5 deadline, and (c) both were months prior to July 24, 2020 when Woodland Glory filed the present 6 motion. Consequently, the Court must deny the present motion because Woodland Glory cannot 7 enforce an agreement it breached multiple months prior. And because the Court must deny Woodland Glory's motion, it must also award Vida "prevailing party" reasonable attorney's fee 9 and cost of $2,279.12. Alternatively, if the Court finds Woodland Glory's motion persuasive, at a 10 minimum it should significantly decrease any award of attorney's fees and costs to Woodland 11 Glory. 12 Dated: September 11, 2020 BPR LAW GROUP 13 By: 14 Brian P. _ Attorney for Plaintiff and Cross-Defendant 15 VIDA CAPITAL GROUP, LLC 16 17 18 19 20 21 22 23 24 25 26 27 28 -10- VIDA CAPITAL GROUP, LLC'S OPP. TO DBFS. AND CROSS-COMPLAINANTS' MOTION TO DISMISS