Preview
ELECTRONICALLY FILED
Superior Court of California
1 ROBERT J. ROMERO (SBN 136539) County of Santa Cruz
rromero@hinshawlaw.com 9/30/2021 1:37 PM
2 EVAN M. REESE (SBN 302952) Alex Calvo, Clerk
ereese@hinshawlaw.com By: Dajah de los Santos, Deputy
3 HINSHAW & CULBERTSON LLP
One California Street, 18th Floor
4 San Francisco, CA 94111
Telephone: 415-362-6000
5 Facsimile: 415-834-9070
6 RAY TAMADDON (SBN 144494)
rtamaddon@hinshawlaw.com
7 HINSHAW & CULBERTSON LLP
350 S. Grand Avenue, Suite 3600
8 Los Angeles, CA 90071
Telephone: 310-909-8000
9 Facsimile: 310-909-8001
10 Attorneys for Defendant
ZACHARY NASH DAVIS
11
12 SUPERIOR COURT OF THE STATE OF CALIFORNIA
13 FOR THE COUNTY OF SANTA CRUZ
14
15 DAPHNE BELETSIS, individually, and as Case No. 19CV03287
Administrator of the Estate of ALEXANDER
16 BELETSIS, and YVONNE RAINY, surviving Hon. Rebecca Connolly
parent of ALEXANDER BELETSIS, deceased,
17 APPLICATION BY DEFENDANT
Plaintiffs, ZACHARY NASH DAVIS FOR
18 DETERMINATION OF GOOD FAITH
vs. SETTLEMENT; DECLARATION OF RAY
19 TAMADDON
THETA CHI FRATERNITY, INC., a New
20 York corporation, individually, as a member of [Code of Civil Procedure §877.6(a)(2)]
and t/a the Theta Iota Chapter, University of [NO HEARING REQUIRED]
21 California, Santa Cruz, as a member of the
fraternal order known as Theta Chi Fraternity, First Amended Complaint: 02/05/20
22 and as an alter-ego and successor entity of the Complaint Filed: 10/31/19
Theta Iota Chapter of Theta Chi Fraternity;
23 THETA IOTA CHAPTER OF THETA CHI
FRATERNITY, individually, and as an and
24 agent and alter-ego of Theta Chi Fraternity,
Inc.; CHRISTOPHER GUEVARA,
25 individually, and as an agent/member of Theta
Chi Fraternity, Inc. and Theta Iota Chapter of
26 Theta Chi Fraternity; BRAD VISACKI,
individually, and/or as an agent/member of
27 Theta Chi Fraternity, Inc. and Theta Iota
Chapter of Theta Chi Fraternity; JORDAN
28 KEIICHI TAKAYAMA, individually, and as an
agent/member of Theta Chi Fraternity, Inc. and
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1 Theta Iota Chapter of Theta Chi Fraternity;
ZACHARY NASH DAVIS, individually, and
2 as an agent/member of Theta Chi Fraternity,
Inc. and Theta Iota Chapter of Theta Chi
3 Fraternity; NAJPREET SINGH KAHLON,
individually, and as an agent/member of Theta
4 Chi Fraternity, Inc. and Theta Iota Chapter of
Theta Chi Fraternity; STEFAN MATIAS
5 LEON, individually, and as an agent/member of
Theta Chi Fraternity, Inc. and Theta Iota
6 Chapter of Theta Chi Fraternity; MOISES
FRANCISCO TENORIO GARCIA,
7 individually, and as an agent/member of Theta
Chi Fraternity, Inc. and Theta Iota Chapter of
8 Theta Chi Fraternity; RAFAEL GARCIA,
individually, and as an agent/member of Theta
9 Chi Fraternity, Inc. and Theta Iota Chapter of
Theta Chi Fraternity; EMMANUEL THOMAS,
10 individually, and as an agent/member of Theta
Chi Fraternity, Inc. and Theta Iota Chapter of
11 Theta Chi Fraternity; BOBBY KARKI,
individually, and as an agent/member of Theta
12 Chi Fraternity, Inc. and Theta Iota Chapter of
Theta Chi Fraternity; DEREK KING,
13 individually, and as an agent/member of Theta
Chi Fraternity, Inc. and Theta Iota Chapter of
14 Theta Chi Fraternity; JOHN DYLAN LEITCH,
individually, and as an agent/member of Theta
15 Chi Fraternity, Inc. and Theta Iota Chapter of
Theta Chi Fraternity; QUINN MCLAUGHLIN,
16 individually and as Trustee of the QUINN M.
MCLAUGHLIN LIVING TRUST, 117 Pasture
17 Rd., Santa Cruz, CA 95060; and JOHN DOES 1
through 10, inclusive, individually, and as
18 agents/members of Theta Chi Fraternity, Inc.
and Theta Iota Chapter of Theta Chi Fraternity;
19
Defendants.
20
21 I. INTRODUCTION
22 Defendant Zachary Nash Davis (hereafter “Settling Defendant”) submits the following
23 Application for Determination of Good Faith Settlement with plaintiffs Daphne Beletsis and Yvonne
24 Rainy (“Plaintiffs”) pursuant to Code of Civil Procedure § 877.6(a)(2) and for an order barring and
25 dismissing all existing and future claims, known or unknown, against Settling Defendant.
26 This is a relatively straightforward case. Plaintiffs are the parents of Alex Beletsis, a twenty-
27 year-old college student at the University of California, Santa Cruz (“UC Santa Cruz”) who tragically
28 died on June 2, 2018 by either jumping or falling through a second-story bathroom window after
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1 voluntarily consuming large amounts of alcohol, cocaine, and marijuana. Settling Defendant was a
2 fellow member and chapter officer of Beletsis’ fraternity, Theta Chi, which held a fraternity
3 ceremony and after-party earlier in the evening. While no one disputes the catastrophic nature of the
4 events that night, Settling Defendant was Beletsis’ peer, a fellow college student who had no “special
5 relationship” with the decedent, had no meaningful interactions with him on the night of the incident,
6 and could not have possibly foreseen Beletsis’ death.
7 II. SETTLING PARTIES AND THE TERMS OF THE SETTLEMENT
8 Settling Defendant Zachary Nash Davis has reached a confidential settlement with Plaintiffs
9 Daphne Beletsis and Yvonne Rainy, surviving parents of decedent Alex Beletsis, under which he has
10 agreed to pay a sum in exchange for a dismissal with prejudice of the action and a release of all
11 known and unknown claims as against Settling Defendant (the “Agreement”).
12 Settling Defendant’s settlement with Plaintiffs is confidential. Confidentiality is a material
13 term of the agreement. (See, Declaration of Ray Tamaddon “Tamaddon Dec” ¶2). The settlement
14 amount and terms are being filed concurrently under seal with this Motion. The settlement amount
15 represents a significant payment and is a fair and equitable settlement given the liability issues in the
16 case, as discussed more fully below. The terms of the Agreement include a provision that the
17 settlement is contingent on a finding by this Court that the settlement is in “good faith” within the
18 meaning of Code of Civil Procedure section 877 and 877.6. (See, Declaration of Ray Tamaddon
19 “Tamaddon Dec” ¶3).
20 III. STATEMENT OF FACTS
21 This matter arises out of the tragic death of Alex Beletsis (“Beletsis”), a twenty-year-old
22 college student at the University of California, Santa Cruz (“UC Santa Cruz”). On June 2, 2018,
23 Beletsis’ fraternity, Theta Chi, held a ceremony and after-party commemorating the initiation of a
24 new pledge class. On the date of the incident, Beletsis himself was already a full-fledged, active
25 member of Theta Chi who had joined the fraternity a year prior. At the ceremony and after-party,
26 Beletsis voluntarily consumed large amounts of vodka, Jägermeister, beer, marijuana, cocaine, and
27 possible Xanax.
28 At some point later in the evening, Beletsis either fell or jumped from the second-story
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1 bathroom window of a residence in Santa Cruz onto the ground below. Beletsis sustained severe
2 brain and spinal cord injuries and was rushed to intensive care. Beletsis was hospitalized for
3 numerous days until he was eventually removed from life support and died.
4 UC Santa Cruz started an extensive investigation to determine what happened. Part of this
5 investigation involved interviewing numerous Theta Chi members and threatening them with
6 potential suspension, expulsion and/or issues related to criminal prosecution if they did not cooperate
7 and provide the University with the information it was looking for. The investigation culminated in
8 a report authored by University official Jose Sanchez (“Sanchez”), who concluded that the fraternity
9 ceremony and after-party involved hazing and older fraternity members furnishing Beletsis with
10 excessive amounts of alcohol and drugs despite being aware of his intoxication. As a result of
11 Sanchez’ report, Theta Chi’s registration as a campus organization was permanently revoked and all
12 the Chapter’s officers were removed.
13 A few months after UC Santa Cruz concluded its investigation and presented its findings to
14 Beletsis’ family, this lawsuit was initiated. On October 31, 2019, Plaintiffs filed a Complaint,
15 originally naming Theta Chi Fraternity, Inc. (the national organization); the Theta Iota Chapter of
16 Theta Chi Fraternity (the local Theta Chi chapter at UC-Santa Cruz); Christopher Guevara (the
17 Chapter president at the time of Beletsis’ death); 4) Brad Visacki (the Chapter brotherhood chair);
18 and 5) Quinn McLaughlin (the trustee of the living trust which owns the residence where Beletsis
19 died). On February 5, 2020, Plaintiffs thereafter amended their complaint to add ten additional
20 individual defendants, many of whom were Chapter officers on the date of the incident or were
21 Chapter members who resided at the house where the incident occurred. The overarching theory of
22 plaintiffs’ case against all the fraternity defendants is that Beletsis was hazed and plied with drugs
23 and alcohol as part of the fraternity events on the date of the incident.
24 There are numerous individual defendants that have been named in this lawsuit simply
25 because they were Chapter officers on the date of the incident. Those defendants include: Settling
26 Defendant Zachary Davis (Vice President of Health & Safety), Chris Guevara (President), Jordan
27 Takayama (Vice-President), Moises Garcia (Marshal), Najpreet Kahlon (Treasurer), Stefan Leon
28 (Secretary), Rafael Garcia, Jr. (Student Government Representative), and Brad Visacki (Brotherhood
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1 Chair).
2 The allegations against all the Chapter officers are largely the same – because they held a
3 position of leadership in the organization, they were responsible for the fraternity events on the night
4 at issue and are liable for the incident because it occurred at one of those events. In essence, plaintiffs
5 seek to hold each of these young men liable under the “special relationship” theory of liability.
6 IV. LEGAL STANDARD
7 Under California law, the determination of the good faith of a settlement entered into by a
8 party and one or more joint tortfeasors or co-obligors in an action is governed by Code of Civil
9 Procedure section 877.6. So long as the settlements are held to be “in good faith,” those settlements
10 discharge the settling tortfeasors or co-obligors from all liability for non-express indemnity and
11 contribution to any other party. Code Civ. Proc. §§ 877, 877.6; KAOM, Inc. v. Superior Court (1995)
12 35 Cal.App.4th 552, 554-55.
13 Specifically, section 877.6 provides, in pertinent part, as follows:
14 (a)(1) Any party to an action in which it is alleged that two or more
parties are joint tortfeasors or co-obligors on a contract debt shall be
15 entitled to a hearing on the issue of the good faith of a settlement
entered into by the plaintiff or other claimant and one or more alleged
16 tortfeasors or co-obligors, upon giving notice. . .
17 (a)(2) In the alternative, a settling party may give notice of settlement
to all parties and to the court, together with an application for
18 determination of good faith settlement and a proposed order. The
application shall indicate the settling parties, and the basis, terms, and
19 amount of the settlement. The notice, application, and proposed order
shall be given by certified mail, return receipt requested. Proof of
20 service shall be filed with the court. Within 25 days of the mailing of
the notice, application, and proposed order, or within 20 days of
21 personal service, a nonsettling party may file a notice of motion to
contest the good faith of the settlement. If none of the nonsettling
22 parties files a motion within 25 days of mailing of the notice,
application, and proposed order, or within 20 days of personal service,
23 the court may approve the settlement. . . .
24 (b) The issue of the good faith of a settlement may be determined by
the court on the basis of affidavits served with the notice of hearing,
25 and any counter affidavits filed in response, or the court may, in its
discretion, receive other evidence at the hearing.
26
(c) A determination by the court that the settlement was made in good
27 faith shall bar any other joint tortfeasor or co-obligor from any further
claims against the settling tortfeasor or co-obligor for equitable
28 comparative contribution, or partial or comparative indemnity, based
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1 on comparative negligence or comparative fault.
2 (d) The party asserting the lack of good faith shall have the burden of
proof on that issue.
3
4 (Code Civ. Proc. § 877.6.)
5 Pursuant to Code Civ. Proc. § 877.6(a)(2), this Court may determine a settlement to be in
6 good faith without a hearing. This simplified procedure enables the Court to determine that the
7 settlement herein was entered in good faith with the necessity of a motion or hearing. Any non-
8 settling defendant opposing the Application bears the burden of proving that the settlement was not
9 made in good faith. Tech-Bilt, Inc. v. Woodward-Clyde & Assoc. (1985) 38 Cal.3d 488; Code of
10 Civil Procedure § 877.6(d).
11 Courts recognize that “good faith” is a flexible concept. Price Pfister, Inc. v. William Lyon
12 Co. (1993) 14 Cal.App.4th 1643. Ultimately, the decision as to whether a settlement is in “good
13 faith” is left to the sound discretion of the trial court. Tech-Bilt, Inc. v. Woodward Clyde & Associates
14 (1985) 38 Cal.3d 488, 502 (“Tech-Bilt”.)
15 In Tech-Bilt, the California Supreme Court explained the meaning of a “good faith
16 settlement” as set forth in section 877.6 and, further, established the relevant considerations for the
17 trial court in its determination thereof. Tech-Bilt, supra, 38 Cal.3d at 489, 491. These criteria include:
18 i. A rough approximation of the plaintiffs’ total recovery and the settling
19 defendants’ proportionate liability;
20 ii. The amount paid in settlement;
21 iii. The allocation of settlement proceeds among plaintiffs;
22 iv. The recognition that a settler should pay less in settlement than if s/he were
23 found liable after trial;
24 v. The financial conditions and insurance policy limits of settling defendants;
25 vi. The existence of collusion, fraud, or tortious conduct aimed to injure the
26 interests of nonsettling defendants.
See Tech-Bilt, supra, 38 Cal.3d at p. 489.
27
28 A determination as to the good faith of a proposed settlement necessarily requires that the
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1 trial court examine and weigh the above-listed relevant factors, one of the most important of which
2 is the settling parties’ proportionate liability. See Mattco Forge, Inc. v. Arthur Young & Company
3 (1995) 38 Cal.App.4th 1337, 1350.
4 In the series of decisions beginning with Tech-Bilt, California courts have emphasized that a
5 settlement would be in good faith where the trial court determines the proposed amount to be within
6 the reasonable range of the settling defendants’ proportionate liability. See Tech-Bilt, supra, 38
7 Cal.3d at 498-500; see also Bay Development, Ltd. v. Superior Court (1980) 50 Cal.3d 1012, 1034.
8 If the evidence shows that the settlement amount is factually within the “ballpark” range, then the
9 proposed settlement may properly be determined to be a “settlement made in good faith.” See Tech-
10 Bilt, supra, 38 Cal.3d at 498-500.
11 V. THE SETTLEMENT WAS MADE IN GOOD FAITH
12 A. Rough Approximation of Plaintiff’s Total Recovery and Defendants’
Proportionate Liability
13
14 The “pretrial settlement approval procedure” should not be “a full-scale mini-trial.” (Tech-
15 Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488, 499.) “[D]amages are often
16 speculative, and the probability of legal liability therefore is often uncertain or remote.” (Id.) “[T]he
17 inquiry at the good faith settlement stage is not the same as the inquiry at trial,where complete
18 precision of allocation could presumably be achieved.” (Regan Roofing Co. v. Superior Court (1994)
19 21 Cal.App.4th 1685, 1704.) “[T]here is no requirement that a plaintiff must conduct a reasonable
20 investigation and perform reasonable diligence to determine any potential liability of a settling
21 defendant before entering into a good faith settlement. Such a requirement would be contrary to the
22 public policy encouraging settlements and would discourage parties from entering into settlements
23 early in the litigation process before incurring substantial litigation costs.
24 Likewise, there is no requirement that a settling defendant disclose to a plaintiff all theories
25 supporting its potential liability, or evidence tending to prove its liability, before a good faith
26 settlement can be made.” (Cahill v. San Diego Gas & Electric Co. (2011) 194 Cal.App.4th 939, 966.)
27 The moving party need only establish a “rough approximation” between the settlement amount and
28 the proportionate liability. (Bay Development Ltd. v. Superior Court (1990) 50 Cal.3d
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1 1012, 1027-29.)
2 Settling Defendant strongly contends he bears no liability to Plaintiffs. Settling Defendant
3 was a fellow member of the Theta Chi fraternity at UC Santa Cruz at the time of Beletsis’ death.
4 While Settling Defendant was an officer in the fraternity, there are no facts to suggest the decedent
5 was dependent upon the Settling Defendant for his care and safety. Like Beletsis, Settling Defendant
6 was an undergraduate student previously initiated into the fraternity and was an active member –
7 thus, they were peers and equals. Settling Defendant had no “special relationship” with Beletsis
8 simply because he was in a leadership position at the fraternity on the date of Beletsis’ death, and
9 thus had no elevated duty to protect him from harm.
10 Furthermore, there is also no evidence that the harm to Beletsis was reasonably foreseeable
11 to the Settling Defendant, nor to any of the Chapter officers or fellow members for that matter. While
12 it is not beyond the realm of possibility that a college student can become injured after a night of
13 heavy drinking and drug use, it is unreasonable to suggest that Beletsis falling out of the window (or,
14 perhaps jumping out) would have been reasonably foreseeable to any of these young men. There is
15 no evidence that Settling Defendant had any meaningful interactions with Beletsis on the night of
16 the incident, such that it would have been reasonable (or even possible) for him to appreciate his
17 level of intoxication. Moreover, as deposition testimony has made clear, those individuals who spent
18 the most time with Beletsis that evening did not even recognize, nor appreciate, Beletsis’ level of
19 intoxication throughout most of the evening.
20 While Plaintiffs will likely seek damages in excess of seven figures, there are numerous
21 anticipated motions for summary judgement and/or adjudication. “In determining a settling
22 defendant's equitable proportionate share of liability, the judge does not look to the plaintiff's claim
23 for damages; rather the judge tries to determine a ‘rough approximation’ of what the plaintiff would
24 actually recover if the case should go to trial.” (Horton v. Superior Court (1987) 194 Cal.App.3d
25 727, 735.) “This amount is then discounted for settlement purposes based on the savings in trial time,
26 defense costs, attorneys' fees and the avoidance of the risk inherent in every trial of a verdict or
27 judgment larger than expected.” Id. “The trial court has wide discretion in deciding whether a
28 settlement is in good faith and in arriving at an allocation of valuation of the various interests
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1 involved.” (North County Contractor's Assn. v. Touchstone Ins. Services (1994) 27 Cal.App.4th
2 1085, 1095.)
3 Settling Defendant contends that he is not responsible for any damages Plaintiffs would be
4 able to prove at trial. Even if the Court ultimately found Settling Defendant to be liable to some
5 degree, the proportionate liability would be far less than that of the remaining defendants.
6 B. The Amount Defendants Will Pay in Settlement, Allocation of Settlement
Proceeds, and Recognition Settlement Amount Should be Less Than if Liability
7 Were Established at Trial
8 Despite the most tenuous of potential liability, if any, Settling Defendant has agreed to pay a
9 significant sum to settle this lawsuit. As there is only two plaintiffs in this matter, each will
10 presumably will receive 50% of the settlement proceeds. The settlement represents a desire to
11 mitigate potential exposure, if any, the fact of which Defendants strongly deny, and avoid expensive
12 and protracted litigation and trial. (Tamaddon Dec. ¶3). The settlement takes into account the strength
13 of Defendant’s position on liability, the strength of the co-defendants’ positions, the litigation
14 expenses Defendant may incur without settlement, the risks associated with trial, as well as the
15 recognition that Defendant should pay less in settlement than if they were found liable at trial. (Id.).
16 C. Financial Conditions of Defendant and Existence of Collusion, Fraud, or
Tortious Conduct
17
18 There was no collusion, fraud, or tortious conduct. The parties, each represented by legal
19 counsel, reached the settlement through arm’s length negotiations. The settlement represents a desire
20 to mitigate any potential exposure, the fact of which is strongly denied by the Defendant, and avoid
21 an expensive and protracted litigation. (Tamaddon Decl., ¶3). “The presumption of good faith attends
22 upon every act, unless the surrounding circumstances are such as to overcome the presumption.”
23 (Kelmmer v.Kelmmer (1919) 42 Cal.App. 618, 626.) “Tech-Bilt does not require settling defendants
24 to present [financial condition] evidence.” (Cahill v. San Diego Gas & Electric Co. (2011) 194
25 Cal.App.4th 939, 968.) “A ‘disproportionately low’ settlement is a threshold requirement” for the
26 relevancy of a settling defendant’s ability to pay more. (L.C. Rudd & Son, Inc. v. Sup.Ct. (1997) 52
27 Cal.App.4th 742, 749.)
28 //
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1 D. The Settlement Figure is Not Grossly Disproportionate to What a Reasonable
Person Would Estimate Defendants’ Liability To Be
2
3 “The party asserting the lack of good faith … has the burden of proof … that the settlement
4 is so far ‘out of the ballpark’ in relation to these factors as to be inconsistent with the equitable
5 objectives of the statute.” (Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488,
6 499-500.) The settlement figure “must not be grossly disproportionate to what a reasonable person,
7 at the time of the settlement, would estimate the settling defendants’ liability to be.” (Torres v. Union
8 Pacific Railroad Company (1984) 157 Cal.App.3d 499, 509.) “As Tech-Bilt emphasizes, of course,
9 a ‘good faith’ settlement does not call for perfect or even nearly perfect apportionment of liability.
10 In order to encourage settlement, itis quite proper for a settling defendant to pay less than his
11 proportionate share of the anticipated damages.” (Abbott Ford, Inc. v. Superior Court (1987) 43
12 Cal.3d 858, 874.) “An educated guess is the best a judge can do when deciding whether a settlement
13 is made in good faith.” (No. County Contractor’s Assoc. v. Touchstone Ins. Servs. (1994) 27
14 Cal.App.4th 1085, 1095.)
15 The settlement amount is well within the “ballpark” given the absence of liability against
16 this Settling Defendant, and is certainly not “grossly disproportionate.” Were this case to proceed
17 through trial, Defendants’ liability would almost surely be zero, and in any event far below the
18 settlement amount he has agreed to pay.
19 VI. CONCLUSION
20 Defendants respectfully request the Court find the settlement is in good faith. California has
21 a “public policy of encouraging good faith settlement.” (Ratcliff Architects v. Vanir Construction
22 Management, Inc. (2001) 88 Cal.App.4th 595, 607.)
23 Respectfully Submitted
DATED: September 29, 2021 HINSHAW & CULBERTSON LLP
24
25 By:
ROBERT ROMERO
26 RAY TAMADDON
EVAN M. REESE
27 Attorneys for Defendant
ZACHARY NASH DAVIS
28
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Preview
ELECTRONICALLY FILED Superior Court of California 1 ROBERT J. ROMERO (SBN 136539) County of Santa Cruz rromero@hinshawlaw.com 9/30/2021 1:37 PM 2 EVAN M. REESE (SBN 302952) Alex Calvo, Clerk ereese@hinshawlaw.com By: Dajah de los Santos, Deputy 3 HINSHAW & CULBERTSON LLP One California Street, 18th Floor 4 San Francisco, CA 94111 Telephone: 415-362-6000 5 Facsimile: 415-834-9070 6 RAY TAMADDON (SBN 144494) rtamaddon@hinshawlaw.com 7 HINSHAW & CULBERTSON LLP 350 S. Grand Avenue, Suite 3600 8 Los Angeles, CA 90071 Telephone: 310-909-8000 9 Facsimile: 310-909-8001 10 Attorneys for Defendant ZACHARY NASH DAVIS 11 12 SUPERIOR COURT OF THE STATE OF CALIFORNIA 13 FOR THE COUNTY OF SANTA CRUZ 14 15 DAPHNE BELETSIS, individually, and as Case No. 19CV03287 Administrator of the Estate of ALEXANDER 16 BELETSIS, and YVONNE RAINY, surviving Hon. Rebecca Connolly parent of ALEXANDER BELETSIS, deceased, 17 APPLICATION BY DEFENDANT Plaintiffs, ZACHARY NASH DAVIS FOR 18 DETERMINATION OF GOOD FAITH vs. SETTLEMENT; DECLARATION OF RAY 19 TAMADDON THETA CHI FRATERNITY, INC., a New 20 York corporation, individually, as a member of [Code of Civil Procedure §877.6(a)(2)] and t/a the Theta Iota Chapter, University of [NO HEARING REQUIRED] 21 California, Santa Cruz, as a member of the fraternal order known as Theta Chi Fraternity, First Amended Complaint: 02/05/20 22 and as an alter-ego and successor entity of the Complaint Filed: 10/31/19 Theta Iota Chapter of Theta Chi Fraternity; 23 THETA IOTA CHAPTER OF THETA CHI FRATERNITY, individually, and as an and 24 agent and alter-ego of Theta Chi Fraternity, Inc.; CHRISTOPHER GUEVARA, 25 individually, and as an agent/member of Theta Chi Fraternity, Inc. and Theta Iota Chapter of 26 Theta Chi Fraternity; BRAD VISACKI, individually, and/or as an agent/member of 27 Theta Chi Fraternity, Inc. and Theta Iota Chapter of Theta Chi Fraternity; JORDAN 28 KEIICHI TAKAYAMA, individually, and as an agent/member of Theta Chi Fraternity, Inc. and 1 Def’s Application for Good Faith Settlement Santa Cruz Superior Court Case No. 19CV03287 1030248\309146393.v1 1 Theta Iota Chapter of Theta Chi Fraternity; ZACHARY NASH DAVIS, individually, and 2 as an agent/member of Theta Chi Fraternity, Inc. and Theta Iota Chapter of Theta Chi 3 Fraternity; NAJPREET SINGH KAHLON, individually, and as an agent/member of Theta 4 Chi Fraternity, Inc. and Theta Iota Chapter of Theta Chi Fraternity; STEFAN MATIAS 5 LEON, individually, and as an agent/member of Theta Chi Fraternity, Inc. and Theta Iota 6 Chapter of Theta Chi Fraternity; MOISES FRANCISCO TENORIO GARCIA, 7 individually, and as an agent/member of Theta Chi Fraternity, Inc. and Theta Iota Chapter of 8 Theta Chi Fraternity; RAFAEL GARCIA, individually, and as an agent/member of Theta 9 Chi Fraternity, Inc. and Theta Iota Chapter of Theta Chi Fraternity; EMMANUEL THOMAS, 10 individually, and as an agent/member of Theta Chi Fraternity, Inc. and Theta Iota Chapter of 11 Theta Chi Fraternity; BOBBY KARKI, individually, and as an agent/member of Theta 12 Chi Fraternity, Inc. and Theta Iota Chapter of Theta Chi Fraternity; DEREK KING, 13 individually, and as an agent/member of Theta Chi Fraternity, Inc. and Theta Iota Chapter of 14 Theta Chi Fraternity; JOHN DYLAN LEITCH, individually, and as an agent/member of Theta 15 Chi Fraternity, Inc. and Theta Iota Chapter of Theta Chi Fraternity; QUINN MCLAUGHLIN, 16 individually and as Trustee of the QUINN M. MCLAUGHLIN LIVING TRUST, 117 Pasture 17 Rd., Santa Cruz, CA 95060; and JOHN DOES 1 through 10, inclusive, individually, and as 18 agents/members of Theta Chi Fraternity, Inc. and Theta Iota Chapter of Theta Chi Fraternity; 19 Defendants. 20 21 I. INTRODUCTION 22 Defendant Zachary Nash Davis (hereafter “Settling Defendant”) submits the following 23 Application for Determination of Good Faith Settlement with plaintiffs Daphne Beletsis and Yvonne 24 Rainy (“Plaintiffs”) pursuant to Code of Civil Procedure § 877.6(a)(2) and for an order barring and 25 dismissing all existing and future claims, known or unknown, against Settling Defendant. 26 This is a relatively straightforward case. Plaintiffs are the parents of Alex Beletsis, a twenty- 27 year-old college student at the University of California, Santa Cruz (“UC Santa Cruz”) who tragically 28 died on June 2, 2018 by either jumping or falling through a second-story bathroom window after 2 Def’s Application for Good Faith Settlement Santa Cruz Superior Court Case No. 19CV03287 1030248\309146393.v1 1 voluntarily consuming large amounts of alcohol, cocaine, and marijuana. Settling Defendant was a 2 fellow member and chapter officer of Beletsis’ fraternity, Theta Chi, which held a fraternity 3 ceremony and after-party earlier in the evening. While no one disputes the catastrophic nature of the 4 events that night, Settling Defendant was Beletsis’ peer, a fellow college student who had no “special 5 relationship” with the decedent, had no meaningful interactions with him on the night of the incident, 6 and could not have possibly foreseen Beletsis’ death. 7 II. SETTLING PARTIES AND THE TERMS OF THE SETTLEMENT 8 Settling Defendant Zachary Nash Davis has reached a confidential settlement with Plaintiffs 9 Daphne Beletsis and Yvonne Rainy, surviving parents of decedent Alex Beletsis, under which he has 10 agreed to pay a sum in exchange for a dismissal with prejudice of the action and a release of all 11 known and unknown claims as against Settling Defendant (the “Agreement”). 12 Settling Defendant’s settlement with Plaintiffs is confidential. Confidentiality is a material 13 term of the agreement. (See, Declaration of Ray Tamaddon “Tamaddon Dec” ¶2). The settlement 14 amount and terms are being filed concurrently under seal with this Motion. The settlement amount 15 represents a significant payment and is a fair and equitable settlement given the liability issues in the 16 case, as discussed more fully below. The terms of the Agreement include a provision that the 17 settlement is contingent on a finding by this Court that the settlement is in “good faith” within the 18 meaning of Code of Civil Procedure section 877 and 877.6. (See, Declaration of Ray Tamaddon 19 “Tamaddon Dec” ¶3). 20 III. STATEMENT OF FACTS 21 This matter arises out of the tragic death of Alex Beletsis (“Beletsis”), a twenty-year-old 22 college student at the University of California, Santa Cruz (“UC Santa Cruz”). On June 2, 2018, 23 Beletsis’ fraternity, Theta Chi, held a ceremony and after-party commemorating the initiation of a 24 new pledge class. On the date of the incident, Beletsis himself was already a full-fledged, active 25 member of Theta Chi who had joined the fraternity a year prior. At the ceremony and after-party, 26 Beletsis voluntarily consumed large amounts of vodka, Jägermeister, beer, marijuana, cocaine, and 27 possible Xanax. 28 At some point later in the evening, Beletsis either fell or jumped from the second-story 3 Def’s Application for Good Faith Settlement Santa Cruz Superior Court Case No. 19CV03287 1030248\309146393.v1 1 bathroom window of a residence in Santa Cruz onto the ground below. Beletsis sustained severe 2 brain and spinal cord injuries and was rushed to intensive care. Beletsis was hospitalized for 3 numerous days until he was eventually removed from life support and died. 4 UC Santa Cruz started an extensive investigation to determine what happened. Part of this 5 investigation involved interviewing numerous Theta Chi members and threatening them with 6 potential suspension, expulsion and/or issues related to criminal prosecution if they did not cooperate 7 and provide the University with the information it was looking for. The investigation culminated in 8 a report authored by University official Jose Sanchez (“Sanchez”), who concluded that the fraternity 9 ceremony and after-party involved hazing and older fraternity members furnishing Beletsis with 10 excessive amounts of alcohol and drugs despite being aware of his intoxication. As a result of 11 Sanchez’ report, Theta Chi’s registration as a campus organization was permanently revoked and all 12 the Chapter’s officers were removed. 13 A few months after UC Santa Cruz concluded its investigation and presented its findings to 14 Beletsis’ family, this lawsuit was initiated. On October 31, 2019, Plaintiffs filed a Complaint, 15 originally naming Theta Chi Fraternity, Inc. (the national organization); the Theta Iota Chapter of 16 Theta Chi Fraternity (the local Theta Chi chapter at UC-Santa Cruz); Christopher Guevara (the 17 Chapter president at the time of Beletsis’ death); 4) Brad Visacki (the Chapter brotherhood chair); 18 and 5) Quinn McLaughlin (the trustee of the living trust which owns the residence where Beletsis 19 died). On February 5, 2020, Plaintiffs thereafter amended their complaint to add ten additional 20 individual defendants, many of whom were Chapter officers on the date of the incident or were 21 Chapter members who resided at the house where the incident occurred. The overarching theory of 22 plaintiffs’ case against all the fraternity defendants is that Beletsis was hazed and plied with drugs 23 and alcohol as part of the fraternity events on the date of the incident. 24 There are numerous individual defendants that have been named in this lawsuit simply 25 because they were Chapter officers on the date of the incident. Those defendants include: Settling 26 Defendant Zachary Davis (Vice President of Health & Safety), Chris Guevara (President), Jordan 27 Takayama (Vice-President), Moises Garcia (Marshal), Najpreet Kahlon (Treasurer), Stefan Leon 28 (Secretary), Rafael Garcia, Jr. (Student Government Representative), and Brad Visacki (Brotherhood 4 Def’s Application for Good Faith Settlement Santa Cruz Superior Court Case No. 19CV03287 1030248\309146393.v1 1 Chair). 2 The allegations against all the Chapter officers are largely the same – because they held a 3 position of leadership in the organization, they were responsible for the fraternity events on the night 4 at issue and are liable for the incident because it occurred at one of those events. In essence, plaintiffs 5 seek to hold each of these young men liable under the “special relationship” theory of liability. 6 IV. LEGAL STANDARD 7 Under California law, the determination of the good faith of a settlement entered into by a 8 party and one or more joint tortfeasors or co-obligors in an action is governed by Code of Civil 9 Procedure section 877.6. So long as the settlements are held to be “in good faith,” those settlements 10 discharge the settling tortfeasors or co-obligors from all liability for non-express indemnity and 11 contribution to any other party. Code Civ. Proc. §§ 877, 877.6; KAOM, Inc. v. Superior Court (1995) 12 35 Cal.App.4th 552, 554-55. 13 Specifically, section 877.6 provides, in pertinent part, as follows: 14 (a)(1) Any party to an action in which it is alleged that two or more parties are joint tortfeasors or co-obligors on a contract debt shall be 15 entitled to a hearing on the issue of the good faith of a settlement entered into by the plaintiff or other claimant and one or more alleged 16 tortfeasors or co-obligors, upon giving notice. . . 17 (a)(2) In the alternative, a settling party may give notice of settlement to all parties and to the court, together with an application for 18 determination of good faith settlement and a proposed order. The application shall indicate the settling parties, and the basis, terms, and 19 amount of the settlement. The notice, application, and proposed order shall be given by certified mail, return receipt requested. Proof of 20 service shall be filed with the court. Within 25 days of the mailing of the notice, application, and proposed order, or within 20 days of 21 personal service, a nonsettling party may file a notice of motion to contest the good faith of the settlement. If none of the nonsettling 22 parties files a motion within 25 days of mailing of the notice, application, and proposed order, or within 20 days of personal service, 23 the court may approve the settlement. . . . 24 (b) The issue of the good faith of a settlement may be determined by the court on the basis of affidavits served with the notice of hearing, 25 and any counter affidavits filed in response, or the court may, in its discretion, receive other evidence at the hearing. 26 (c) A determination by the court that the settlement was made in good 27 faith shall bar any other joint tortfeasor or co-obligor from any further claims against the settling tortfeasor or co-obligor for equitable 28 comparative contribution, or partial or comparative indemnity, based 5 Def’s Application for Good Faith Settlement Santa Cruz Superior Court Case No. 19CV03287 1030248\309146393.v1 1 on comparative negligence or comparative fault. 2 (d) The party asserting the lack of good faith shall have the burden of proof on that issue. 3 4 (Code Civ. Proc. § 877.6.) 5 Pursuant to Code Civ. Proc. § 877.6(a)(2), this Court may determine a settlement to be in 6 good faith without a hearing. This simplified procedure enables the Court to determine that the 7 settlement herein was entered in good faith with the necessity of a motion or hearing. Any non- 8 settling defendant opposing the Application bears the burden of proving that the settlement was not 9 made in good faith. Tech-Bilt, Inc. v. Woodward-Clyde & Assoc. (1985) 38 Cal.3d 488; Code of 10 Civil Procedure § 877.6(d). 11 Courts recognize that “good faith” is a flexible concept. Price Pfister, Inc. v. William Lyon 12 Co. (1993) 14 Cal.App.4th 1643. Ultimately, the decision as to whether a settlement is in “good 13 faith” is left to the sound discretion of the trial court. Tech-Bilt, Inc. v. Woodward Clyde & Associates 14 (1985) 38 Cal.3d 488, 502 (“Tech-Bilt”.) 15 In Tech-Bilt, the California Supreme Court explained the meaning of a “good faith 16 settlement” as set forth in section 877.6 and, further, established the relevant considerations for the 17 trial court in its determination thereof. Tech-Bilt, supra, 38 Cal.3d at 489, 491. These criteria include: 18 i. A rough approximation of the plaintiffs’ total recovery and the settling 19 defendants’ proportionate liability; 20 ii. The amount paid in settlement; 21 iii. The allocation of settlement proceeds among plaintiffs; 22 iv. The recognition that a settler should pay less in settlement than if s/he were 23 found liable after trial; 24 v. The financial conditions and insurance policy limits of settling defendants; 25 vi. The existence of collusion, fraud, or tortious conduct aimed to injure the 26 interests of nonsettling defendants. See Tech-Bilt, supra, 38 Cal.3d at p. 489. 27 28 A determination as to the good faith of a proposed settlement necessarily requires that the 6 Def’s Application for Good Faith Settlement Santa Cruz Superior Court Case No. 19CV03287 1030248\309146393.v1 1 trial court examine and weigh the above-listed relevant factors, one of the most important of which 2 is the settling parties’ proportionate liability. See Mattco Forge, Inc. v. Arthur Young & Company 3 (1995) 38 Cal.App.4th 1337, 1350. 4 In the series of decisions beginning with Tech-Bilt, California courts have emphasized that a 5 settlement would be in good faith where the trial court determines the proposed amount to be within 6 the reasonable range of the settling defendants’ proportionate liability. See Tech-Bilt, supra, 38 7 Cal.3d at 498-500; see also Bay Development, Ltd. v. Superior Court (1980) 50 Cal.3d 1012, 1034. 8 If the evidence shows that the settlement amount is factually within the “ballpark” range, then the 9 proposed settlement may properly be determined to be a “settlement made in good faith.” See Tech- 10 Bilt, supra, 38 Cal.3d at 498-500. 11 V. THE SETTLEMENT WAS MADE IN GOOD FAITH 12 A. Rough Approximation of Plaintiff’s Total Recovery and Defendants’ Proportionate Liability 13 14 The “pretrial settlement approval procedure” should not be “a full-scale mini-trial.” (Tech- 15 Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488, 499.) “[D]amages are often 16 speculative, and the probability of legal liability therefore is often uncertain or remote.” (Id.) “[T]he 17 inquiry at the good faith settlement stage is not the same as the inquiry at trial,where complete 18 precision of allocation could presumably be achieved.” (Regan Roofing Co. v. Superior Court (1994) 19 21 Cal.App.4th 1685, 1704.) “[T]here is no requirement that a plaintiff must conduct a reasonable 20 investigation and perform reasonable diligence to determine any potential liability of a settling 21 defendant before entering into a good faith settlement. Such a requirement would be contrary to the 22 public policy encouraging settlements and would discourage parties from entering into settlements 23 early in the litigation process before incurring substantial litigation costs. 24 Likewise, there is no requirement that a settling defendant disclose to a plaintiff all theories 25 supporting its potential liability, or evidence tending to prove its liability, before a good faith 26 settlement can be made.” (Cahill v. San Diego Gas & Electric Co. (2011) 194 Cal.App.4th 939, 966.) 27 The moving party need only establish a “rough approximation” between the settlement amount and 28 the proportionate liability. (Bay Development Ltd. v. Superior Court (1990) 50 Cal.3d 7 Def’s Application for Good Faith Settlement Santa Cruz Superior Court Case No. 19CV03287 1030248\309146393.v1 1 1012, 1027-29.) 2 Settling Defendant strongly contends he bears no liability to Plaintiffs. Settling Defendant 3 was a fellow member of the Theta Chi fraternity at UC Santa Cruz at the time of Beletsis’ death. 4 While Settling Defendant was an officer in the fraternity, there are no facts to suggest the decedent 5 was dependent upon the Settling Defendant for his care and safety. Like Beletsis, Settling Defendant 6 was an undergraduate student previously initiated into the fraternity and was an active member – 7 thus, they were peers and equals. Settling Defendant had no “special relationship” with Beletsis 8 simply because he was in a leadership position at the fraternity on the date of Beletsis’ death, and 9 thus had no elevated duty to protect him from harm. 10 Furthermore, there is also no evidence that the harm to Beletsis was reasonably foreseeable 11 to the Settling Defendant, nor to any of the Chapter officers or fellow members for that matter. While 12 it is not beyond the realm of possibility that a college student can become injured after a night of 13 heavy drinking and drug use, it is unreasonable to suggest that Beletsis falling out of the window (or, 14 perhaps jumping out) would have been reasonably foreseeable to any of these young men. There is 15 no evidence that Settling Defendant had any meaningful interactions with Beletsis on the night of 16 the incident, such that it would have been reasonable (or even possible) for him to appreciate his 17 level of intoxication. Moreover, as deposition testimony has made clear, those individuals who spent 18 the most time with Beletsis that evening did not even recognize, nor appreciate, Beletsis’ level of 19 intoxication throughout most of the evening. 20 While Plaintiffs will likely seek damages in excess of seven figures, there are numerous 21 anticipated motions for summary judgement and/or adjudication. “In determining a settling 22 defendant's equitable proportionate share of liability, the judge does not look to the plaintiff's claim 23 for damages; rather the judge tries to determine a ‘rough approximation’ of what the plaintiff would 24 actually recover if the case should go to trial.” (Horton v. Superior Court (1987) 194 Cal.App.3d 25 727, 735.) “This amount is then discounted for settlement purposes based on the savings in trial time, 26 defense costs, attorneys' fees and the avoidance of the risk inherent in every trial of a verdict or 27 judgment larger than expected.” Id. “The trial court has wide discretion in deciding whether a 28 settlement is in good faith and in arriving at an allocation of valuation of the various interests 8 Def’s Application for Good Faith Settlement Santa Cruz Superior Court Case No. 19CV03287 1030248\309146393.v1 1 involved.” (North County Contractor's Assn. v. Touchstone Ins. Services (1994) 27 Cal.App.4th 2 1085, 1095.) 3 Settling Defendant contends that he is not responsible for any damages Plaintiffs would be 4 able to prove at trial. Even if the Court ultimately found Settling Defendant to be liable to some 5 degree, the proportionate liability would be far less than that of the remaining defendants. 6 B. The Amount Defendants Will Pay in Settlement, Allocation of Settlement Proceeds, and Recognition Settlement Amount Should be Less Than if Liability 7 Were Established at Trial 8 Despite the most tenuous of potential liability, if any, Settling Defendant has agreed to pay a 9 significant sum to settle this lawsuit. As there is only two plaintiffs in this matter, each will 10 presumably will receive 50% of the settlement proceeds. The settlement represents a desire to 11 mitigate potential exposure, if any, the fact of which Defendants strongly deny, and avoid expensive 12 and protracted litigation and trial. (Tamaddon Dec. ¶3). The settlement takes into account the strength 13 of Defendant’s position on liability, the strength of the co-defendants’ positions, the litigation 14 expenses Defendant may incur without settlement, the risks associated with trial, as well as the 15 recognition that Defendant should pay less in settlement than if they were found liable at trial. (Id.). 16 C. Financial Conditions of Defendant and Existence of Collusion, Fraud, or Tortious Conduct 17 18 There was no collusion, fraud, or tortious conduct. The parties, each represented by legal 19 counsel, reached the settlement through arm’s length negotiations. The settlement represents a desire 20 to mitigate any potential exposure, the fact of which is strongly denied by the Defendant, and avoid 21 an expensive and protracted litigation. (Tamaddon Decl., ¶3). “The presumption of good faith attends 22 upon every act, unless the surrounding circumstances are such as to overcome the presumption.” 23 (Kelmmer v.Kelmmer (1919) 42 Cal.App. 618, 626.) “Tech-Bilt does not require settling defendants 24 to present [financial condition] evidence.” (Cahill v. San Diego Gas & Electric Co. (2011) 194 25 Cal.App.4th 939, 968.) “A ‘disproportionately low’ settlement is a threshold requirement” for the 26 relevancy of a settling defendant’s ability to pay more. (L.C. Rudd & Son, Inc. v. Sup.Ct. (1997) 52 27 Cal.App.4th 742, 749.) 28 // 9 Def’s Application for Good Faith Settlement Santa Cruz Superior Court Case No. 19CV03287 1030248\309146393.v1 1 D. The Settlement Figure is Not Grossly Disproportionate to What a Reasonable Person Would Estimate Defendants’ Liability To Be 2 3 “The party asserting the lack of good faith … has the burden of proof … that the settlement 4 is so far ‘out of the ballpark’ in relation to these factors as to be inconsistent with the equitable 5 objectives of the statute.” (Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488, 6 499-500.) The settlement figure “must not be grossly disproportionate to what a reasonable person, 7 at the time of the settlement, would estimate the settling defendants’ liability to be.” (Torres v. Union 8 Pacific Railroad Company (1984) 157 Cal.App.3d 499, 509.) “As Tech-Bilt emphasizes, of course, 9 a ‘good faith’ settlement does not call for perfect or even nearly perfect apportionment of liability. 10 In order to encourage settlement, itis quite proper for a settling defendant to pay less than his 11 proportionate share of the anticipated damages.” (Abbott Ford, Inc. v. Superior Court (1987) 43 12 Cal.3d 858, 874.) “An educated guess is the best a judge can do when deciding whether a settlement 13 is made in good faith.” (No. County Contractor’s Assoc. v. Touchstone Ins. Servs. (1994) 27 14 Cal.App.4th 1085, 1095.) 15 The settlement amount is well within the “ballpark” given the absence of liability against 16 this Settling Defendant, and is certainly not “grossly disproportionate.” Were this case to proceed 17 through trial, Defendants’ liability would almost surely be zero, and in any event far below the 18 settlement amount he has agreed to pay. 19 VI. CONCLUSION 20 Defendants respectfully request the Court find the settlement is in good faith. California has 21 a “public policy of encouraging good faith settlement.” (Ratcliff Architects v. Vanir Construction 22 Management, Inc. (2001) 88 Cal.App.4th 595, 607.) 23 Respectfully Submitted DATED: September 29, 2021 HINSHAW & CULBERTSON LLP 24 25 By: ROBERT ROMERO 26 RAY TAMADDON EVAN M. REESE 27 Attorneys for Defendant ZACHARY NASH DAVIS 28 10 Def’s Application for Good Faith Settlement Santa Cruz Superior Court Case No. 19CV03287 1030248\309146393.v1