Preview
8/6/2021
1 LEWIS ZIROGIANNIS, CA Bar No. 321955
lzirogiannis@foley.com
2 JASON Y. WU, CA Bar No. 313368
jwu@foley.com
3 FOLEY & LARDNER LLP
555 CALIFORNIA STREET
4 SUITE 1700
SAN FRANCISCO, CA 94104-1520
5 TELEPHONE: 415.434.4484
FACSIMILE: 415.434.4507
6
Attorneys for Defendants and Cross-Complainants
7 LEARNSHIP CORPORATION and LEARNSHIP
NETWORKS GmbH
8
SUPERIOR COURT OF THE STATE OF CALIFORNIA
9
FOR THE COUNTY OF SAN MATEO
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11
SKYLINE VENTURE PARTNERS LLC, A ) CASE NO: 19-CIV-07663
12 DELAWARE LIMITED LIABILITY CORPORATION )
) DEFENDANTS AND CROSS-
13 PLAINTIFF, ) COMPLAINANTS LEARNSHIP
) CORPORATION AND LEARNSHIP
14 V. ) NETWORKS GMBH’S CASE
) MANAGEMENT AND TRIAL SETTING
15 LEARNSHIP CORPORATION, A DELAWARE ) CONFERENCE STATEMENT
CORPORATION; LEARNSHIP NETWORKS GMBH, )
16 A FOREIGN CORPORATION; AND DOES 1 THROUGH ) DATE: AUGUST 20, 2021
50, INCLUSIVE, ) DEPT: 23
17 )
DEFENDANTS. ) HON. V. RAYMOND SWOPE
18 )
)
19 LEARNSHIP CORPORATION, A DELAWARE )
CORPORATION; LEARNSHIP NETWORKS GMBH, )
20 A FOREIGN CORPORATION, ) CASE FILED: DECEMBER 27, 2019
)
21 CROSS-COMPLAINANTS, )
)
22 V. )
)
23 SKYLINE VENTURE PARTNERS LLC, A )
DELAWARE LIMITED LIABILITY CORPORATION AND )
24 ROES 1 THROUGH 25, INCLUSIVE, )
)
25 CROSS-DEFENDANT. )
)
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27
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DEFENDANTS’ CASE MANAGEMENT AND TRIAL SETTING CONFERENCE STATEMENT
CASE NO. 19-CIV-07663
4811-6884-0948.1
1 Defendants and Cross-Complainants Learnship Corporation and Learnship Networks GmbH
2 (collectively, “Defendants”) hereby submit the following Case Management and Trial Setting
3 Conference Statement:
4 I. STATEMENT OF THE CASE
5 In 2019, Defendant Learnship Corporation purchased GlobalEnglish Corporation
6 (“GlobalEnglish”) from Plaintiff Skyline Venture Partners, LLC (“Plaintiff”) in a Stock Purchase
7 Agreement (“SPA”). Defendant Learnship Networks GmbH (“Learnship Networks”) guaranteed
8 Learnship Corporation’s obligations under the SPA.
9 In entering the SPA, Plaintiff provided financial disclosures and made representations and
10 warranties that (1) Plaintiff had fairly and accurately kept GlobalEnglish’s and its subsidiaries’ financial
11 records in accordance with appropriate accounting principles and disclosed those records accurately; (2)
12 GlobalEnglish and its subsidiaries had no liabilities other than those disclosed in their financial records
13 as of December 31, 2018 and those incurred in the ordinary course of business since then but not
14 material in amount; and (3) Plaintiff would indemnify Learnship Corporation for any unaccrued taxes of
15 GlobalEnglish through the SPA’s closing.
16 Plaintiff breached each of those representations and warranties. After the SPA closed,
17 Defendants discovered numerous liabilities of GlobalEnglish that were not disclosed and/or paid, in
18 violation of Plaintiff’s obligations under the SPA and common law. These included: pension and
19 vacation liabilities for employees of its Korean and Italian subsidiaries; invoices and other fees due for
20 goods and services from various entities, including professional services firms; and various outstanding
21 taxes and penalties incurred but not paid for by GlobalEnglish or Plaintiff. Finally, Defendants
22 discovered that Plaintiff had incurred or caused GlobalEnglish to incur obligations from professional
23 services firms for which Plaintiff was solely liable. Defendants continue to discover liabilities of
24 GlobalEnglish that Plaintiff did not disclose or pay in violation of the SPA and common law.
25 Under the SPA and common law, Defendants are entitled to be indemnified by Plaintiff, and
26 receive a set off against the purchase price in the SPA, for the hundreds of thousands of dollars of
27 liabilities that constitute breaches of Plaintiff’s representations under the SPA, and to be indemnified by
28 Plaintiff for any liabilities of GlobalEnglish for which Plaintiff is responsible and/or failed to pay.
1
DEFENDANTS’ CASE MANAGEMENT AND TRIAL SETTING CONFERENCE STATEMENT
CASE NO. 19-CIV-07663
4811-6884-0948.1
1 Defendants are also entitled to a declaration that the SPA permits this indemnification and set-off. As
2 such, Learnship Corp. has withheld partial payment of the purchase price under the SPA.
3 Plaintiff disputes its obligations under the SPA and has sued for (1) breach of contract, (2)
4 breach of the implied covenant of good faith and fair dealing, (3) specific performance, and (4)
5 declaratory judgment. Defendants have filed a cross-complaint asserting claims for (1) breach of
6 contract, (2) indemnification, and (3) declaratory judgment. Defendants contend they are entitled to
7 monetary damages in an amount to be proven at trial, interest, attorney’s fees and costs to the extent
8 authorized by law or contract, declaratory relief, and further legal or equitable relief the Court deems
9 just.
10 II. RELATED CASES
11 Defendants are unaware of any related cases.
12 III. PARTIES
13 All parties named in the Complaint or Cross-Complaint have been served and have appeared.
14 IV. ADDITIONAL PARTIES
15 At this time, Defendants do not anticipate the addition of any further parties to this action.
16 V. ALTERNATIVE DISPUTE RESOLUTION
17 On January 15, 2021, the parties participated in a private mediation pursuant to the Court’s Civil
18 ADR Program. The parties were unable to resolve this matter at mediation.
19 VI. DISCOVERY
20 The parties have propounded and responded to written discovery. The parties have engaged in
21 informal discovery conferences with Civil Commissioner Ernst Halperin. The parties are currently
22 meeting and conferring regarding search terms and custodians for collection and production of
23 documents responsive to Plaintiff Skyline Venture Partners, LLC’s (“Plaintiff”) Requests for Production
24 of Documents, Sets One and Two to Defendants. The next informal discovery conference before Civil
25 Commissioner Halperin is currently scheduled for August 16, 2021 at 2:00 p.m.
26 Defendants anticipate that the parties will likely have disagreements regarding the scope of
27 search terms and custodians. Defendants have proposed search terms and custodians that have
28 generated 23,695 hits. Plaintiff has counter-proposed search terms and custodians that will increase the
2
DEFENDANTS’ CASE MANAGEMENT AND TRIAL SETTING CONFERENCE STATEMENT
CASE NO. 19-CIV-07663
4811-6884-0948.1
1 number of hits Defendants must review by many multiples. While Defendants are still in the process of
2 collecting documents and running search term hit reports, based on preliminary reports, Defendants
3 anticipate that Plaintiff’s proposed search terms and custodians will yield hits in the hundreds of
4 thousands, if not more. Defendants contend that such a search is unduly burdensome and anticipate
5 raising this issue at the next informal discovery conference.
6 Defendants anticipate noticing depositions of party witnesses, serving third-party discovery, and
7 engaging in expert discovery as needed.
8 VII. TRIAL
9 Plaintiff has requested a jury trial. Defendants estimate that trial will last 5-10 days.
10 At this time, Defendants are unable to offer an estimate of when this case will be ready for trial.
11 Such uncertainty is caused in part by the vast discrepancy between the search terms and custodians
12 proposed by Defendants (which have resulted in 23,695 hits) and those proposed by Plaintiffs (which,
13 based on preliminary estimates, could result in hundreds of thousands of hits, if not more). Given this
14 vast disparity, how the issue of search terms and custodians is ultimately resolved could have a
15 significant impact on any timeline for trial.
16 The parties have scheduled an informal discovery conference for August 16, 2021 at 2:00 p.m.
17 before Civil Commissioner Halperin and expect to raise these issues at that time. Defendants will also
18 meet and confer in good faith with Plaintiff regarding the scope of search terms and custodians, with the
19 expectation that Plaintiff will limit its overly burdensome proposal.
20 Defendants propose setting a further case management conference in 60-90 days, after the parties
21 have had sufficient time to meet and confer regarding these issues. Defendants anticipate that they will
22 be able to provide a more accurate estimate of a viable trial date at such time.
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DEFENDANTS’ CASE MANAGEMENT AND TRIAL SETTING CONFERENCE STATEMENT
CASE NO. 19-CIV-07663
4811-6884-0948.1
1
DATE: AUGUST 6, 2021 FOLEY & LARDNER LLP
2 LEWIS ZIROGIANNIS
JASON Y. WU
3
4
5 By: ______________________________________
JASON Y. WU
6 Attorneys for Defendants and Cross-Complainants
LEARNSHIP CORPORATION and LEARNSHIP
7 NETWORKS GmbH
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DEFENDANTS’ CASE MANAGEMENT AND TRIAL SETTING CONFERENCE STATEMENT
CASE NO. 19-CIV-07663
4811-6884-0948.1
1 PROOF OF SERVICE
2 I am employed in the County of San Francisco, State of California. I am over the age of 18 and not a
party to this action; my current business address is 555 California Street, Suite 1700, San Francisco, CA
3 94104-1520.
4 On August 6, 2021, I served the foregoing document(s) described as: DEFENDANTS AND CROSS-
COMPLAINANTS LEARNSHIP CORPORATION AND LEARNSHIP NETWORKS GMBH’S
5 CASE MANAGEMENT AND TRIAL SETTING CONFERENCE STATEMENT on the interested
parties in this action as follows:
6
Allonn Levy
7 Erika J. Gasaway
Perry J. Woodward
8 Arthur E. Rothrock
HOPKINS & CARLEY, A LAW CORPORATION
9 70 South First St
San Jose, CA 95113
10 Emails:
alevy@hopkinscarley.com
11 egasaway@hopkinscarley.com
pwoodward@hopkinscarley.com
12 arothrock@hopkinscarley.com
13 Attorneys for Plaintiff and Cross-Defendant
14
X BY E-SERVICE
15 X I personally caused each document listed above to be served by a Court-
approved Electronic Court Filing Service Provider by transmitting true and
16 correct copies of each document(s) for electronic service to the parties in this
action.
17
X Executed on August 6, 2021, at San Francisco, California.
18
X I declare under penalty of perjury under the laws of the State of California that
19 the above is true and correct.
X I declare that I am employed in the office of a member of the bar of this court at
20 whose direction the service was made.
21
22
23 Laura Lee
24
25
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1
PROOF OF SERVICE
CASE NO. 19-CIV-07663
4811-6884-0948.1
Preview
8/6/2021 1 LEWIS ZIROGIANNIS, CA Bar No. 321955 lzirogiannis@foley.com 2 JASON Y. WU, CA Bar No. 313368 jwu@foley.com 3 FOLEY & LARDNER LLP 555 CALIFORNIA STREET 4 SUITE 1700 SAN FRANCISCO, CA 94104-1520 5 TELEPHONE: 415.434.4484 FACSIMILE: 415.434.4507 6 Attorneys for Defendants and Cross-Complainants 7 LEARNSHIP CORPORATION and LEARNSHIP NETWORKS GmbH 8 SUPERIOR COURT OF THE STATE OF CALIFORNIA 9 FOR THE COUNTY OF SAN MATEO 10 11 SKYLINE VENTURE PARTNERS LLC, A ) CASE NO: 19-CIV-07663 12 DELAWARE LIMITED LIABILITY CORPORATION ) ) DEFENDANTS AND CROSS- 13 PLAINTIFF, ) COMPLAINANTS LEARNSHIP ) CORPORATION AND LEARNSHIP 14 V. ) NETWORKS GMBH’S CASE ) MANAGEMENT AND TRIAL SETTING 15 LEARNSHIP CORPORATION, A DELAWARE ) CONFERENCE STATEMENT CORPORATION; LEARNSHIP NETWORKS GMBH, ) 16 A FOREIGN CORPORATION; AND DOES 1 THROUGH ) DATE: AUGUST 20, 2021 50, INCLUSIVE, ) DEPT: 23 17 ) DEFENDANTS. ) HON. V. RAYMOND SWOPE 18 ) ) 19 LEARNSHIP CORPORATION, A DELAWARE ) CORPORATION; LEARNSHIP NETWORKS GMBH, ) 20 A FOREIGN CORPORATION, ) CASE FILED: DECEMBER 27, 2019 ) 21 CROSS-COMPLAINANTS, ) ) 22 V. ) ) 23 SKYLINE VENTURE PARTNERS LLC, A ) DELAWARE LIMITED LIABILITY CORPORATION AND ) 24 ROES 1 THROUGH 25, INCLUSIVE, ) ) 25 CROSS-DEFENDANT. ) ) 26 27 28 DEFENDANTS’ CASE MANAGEMENT AND TRIAL SETTING CONFERENCE STATEMENT CASE NO. 19-CIV-07663 4811-6884-0948.1 1 Defendants and Cross-Complainants Learnship Corporation and Learnship Networks GmbH 2 (collectively, “Defendants”) hereby submit the following Case Management and Trial Setting 3 Conference Statement: 4 I. STATEMENT OF THE CASE 5 In 2019, Defendant Learnship Corporation purchased GlobalEnglish Corporation 6 (“GlobalEnglish”) from Plaintiff Skyline Venture Partners, LLC (“Plaintiff”) in a Stock Purchase 7 Agreement (“SPA”). Defendant Learnship Networks GmbH (“Learnship Networks”) guaranteed 8 Learnship Corporation’s obligations under the SPA. 9 In entering the SPA, Plaintiff provided financial disclosures and made representations and 10 warranties that (1) Plaintiff had fairly and accurately kept GlobalEnglish’s and its subsidiaries’ financial 11 records in accordance with appropriate accounting principles and disclosed those records accurately; (2) 12 GlobalEnglish and its subsidiaries had no liabilities other than those disclosed in their financial records 13 as of December 31, 2018 and those incurred in the ordinary course of business since then but not 14 material in amount; and (3) Plaintiff would indemnify Learnship Corporation for any unaccrued taxes of 15 GlobalEnglish through the SPA’s closing. 16 Plaintiff breached each of those representations and warranties. After the SPA closed, 17 Defendants discovered numerous liabilities of GlobalEnglish that were not disclosed and/or paid, in 18 violation of Plaintiff’s obligations under the SPA and common law. These included: pension and 19 vacation liabilities for employees of its Korean and Italian subsidiaries; invoices and other fees due for 20 goods and services from various entities, including professional services firms; and various outstanding 21 taxes and penalties incurred but not paid for by GlobalEnglish or Plaintiff. Finally, Defendants 22 discovered that Plaintiff had incurred or caused GlobalEnglish to incur obligations from professional 23 services firms for which Plaintiff was solely liable. Defendants continue to discover liabilities of 24 GlobalEnglish that Plaintiff did not disclose or pay in violation of the SPA and common law. 25 Under the SPA and common law, Defendants are entitled to be indemnified by Plaintiff, and 26 receive a set off against the purchase price in the SPA, for the hundreds of thousands of dollars of 27 liabilities that constitute breaches of Plaintiff’s representations under the SPA, and to be indemnified by 28 Plaintiff for any liabilities of GlobalEnglish for which Plaintiff is responsible and/or failed to pay. 1 DEFENDANTS’ CASE MANAGEMENT AND TRIAL SETTING CONFERENCE STATEMENT CASE NO. 19-CIV-07663 4811-6884-0948.1 1 Defendants are also entitled to a declaration that the SPA permits this indemnification and set-off. As 2 such, Learnship Corp. has withheld partial payment of the purchase price under the SPA. 3 Plaintiff disputes its obligations under the SPA and has sued for (1) breach of contract, (2) 4 breach of the implied covenant of good faith and fair dealing, (3) specific performance, and (4) 5 declaratory judgment. Defendants have filed a cross-complaint asserting claims for (1) breach of 6 contract, (2) indemnification, and (3) declaratory judgment. Defendants contend they are entitled to 7 monetary damages in an amount to be proven at trial, interest, attorney’s fees and costs to the extent 8 authorized by law or contract, declaratory relief, and further legal or equitable relief the Court deems 9 just. 10 II. RELATED CASES 11 Defendants are unaware of any related cases. 12 III. PARTIES 13 All parties named in the Complaint or Cross-Complaint have been served and have appeared. 14 IV. ADDITIONAL PARTIES 15 At this time, Defendants do not anticipate the addition of any further parties to this action. 16 V. ALTERNATIVE DISPUTE RESOLUTION 17 On January 15, 2021, the parties participated in a private mediation pursuant to the Court’s Civil 18 ADR Program. The parties were unable to resolve this matter at mediation. 19 VI. DISCOVERY 20 The parties have propounded and responded to written discovery. The parties have engaged in 21 informal discovery conferences with Civil Commissioner Ernst Halperin. The parties are currently 22 meeting and conferring regarding search terms and custodians for collection and production of 23 documents responsive to Plaintiff Skyline Venture Partners, LLC’s (“Plaintiff”) Requests for Production 24 of Documents, Sets One and Two to Defendants. The next informal discovery conference before Civil 25 Commissioner Halperin is currently scheduled for August 16, 2021 at 2:00 p.m. 26 Defendants anticipate that the parties will likely have disagreements regarding the scope of 27 search terms and custodians. Defendants have proposed search terms and custodians that have 28 generated 23,695 hits. Plaintiff has counter-proposed search terms and custodians that will increase the 2 DEFENDANTS’ CASE MANAGEMENT AND TRIAL SETTING CONFERENCE STATEMENT CASE NO. 19-CIV-07663 4811-6884-0948.1 1 number of hits Defendants must review by many multiples. While Defendants are still in the process of 2 collecting documents and running search term hit reports, based on preliminary reports, Defendants 3 anticipate that Plaintiff’s proposed search terms and custodians will yield hits in the hundreds of 4 thousands, if not more. Defendants contend that such a search is unduly burdensome and anticipate 5 raising this issue at the next informal discovery conference. 6 Defendants anticipate noticing depositions of party witnesses, serving third-party discovery, and 7 engaging in expert discovery as needed. 8 VII. TRIAL 9 Plaintiff has requested a jury trial. Defendants estimate that trial will last 5-10 days. 10 At this time, Defendants are unable to offer an estimate of when this case will be ready for trial. 11 Such uncertainty is caused in part by the vast discrepancy between the search terms and custodians 12 proposed by Defendants (which have resulted in 23,695 hits) and those proposed by Plaintiffs (which, 13 based on preliminary estimates, could result in hundreds of thousands of hits, if not more). Given this 14 vast disparity, how the issue of search terms and custodians is ultimately resolved could have a 15 significant impact on any timeline for trial. 16 The parties have scheduled an informal discovery conference for August 16, 2021 at 2:00 p.m. 17 before Civil Commissioner Halperin and expect to raise these issues at that time. Defendants will also 18 meet and confer in good faith with Plaintiff regarding the scope of search terms and custodians, with the 19 expectation that Plaintiff will limit its overly burdensome proposal. 20 Defendants propose setting a further case management conference in 60-90 days, after the parties 21 have had sufficient time to meet and confer regarding these issues. Defendants anticipate that they will 22 be able to provide a more accurate estimate of a viable trial date at such time. 23 /// 24 /// 25 /// 26 /// 27 /// 28 /// 3 DEFENDANTS’ CASE MANAGEMENT AND TRIAL SETTING CONFERENCE STATEMENT CASE NO. 19-CIV-07663 4811-6884-0948.1 1 DATE: AUGUST 6, 2021 FOLEY & LARDNER LLP 2 LEWIS ZIROGIANNIS JASON Y. WU 3 4 5 By: ______________________________________ JASON Y. WU 6 Attorneys for Defendants and Cross-Complainants LEARNSHIP CORPORATION and LEARNSHIP 7 NETWORKS GmbH 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 4 DEFENDANTS’ CASE MANAGEMENT AND TRIAL SETTING CONFERENCE STATEMENT CASE NO. 19-CIV-07663 4811-6884-0948.1 1 PROOF OF SERVICE 2 I am employed in the County of San Francisco, State of California. I am over the age of 18 and not a party to this action; my current business address is 555 California Street, Suite 1700, San Francisco, CA 3 94104-1520. 4 On August 6, 2021, I served the foregoing document(s) described as: DEFENDANTS AND CROSS- COMPLAINANTS LEARNSHIP CORPORATION AND LEARNSHIP NETWORKS GMBH’S 5 CASE MANAGEMENT AND TRIAL SETTING CONFERENCE STATEMENT on the interested parties in this action as follows: 6 Allonn Levy 7 Erika J. Gasaway Perry J. Woodward 8 Arthur E. Rothrock HOPKINS & CARLEY, A LAW CORPORATION 9 70 South First St San Jose, CA 95113 10 Emails: alevy@hopkinscarley.com 11 egasaway@hopkinscarley.com pwoodward@hopkinscarley.com 12 arothrock@hopkinscarley.com 13 Attorneys for Plaintiff and Cross-Defendant 14 X BY E-SERVICE 15 X I personally caused each document listed above to be served by a Court- approved Electronic Court Filing Service Provider by transmitting true and 16 correct copies of each document(s) for electronic service to the parties in this action. 17 X Executed on August 6, 2021, at San Francisco, California. 18 X I declare under penalty of perjury under the laws of the State of California that 19 the above is true and correct. X I declare that I am employed in the office of a member of the bar of this court at 20 whose direction the service was made. 21 22 23 Laura Lee 24 25 26 27 28 1 PROOF OF SERVICE CASE NO. 19-CIV-07663 4811-6884-0948.1