17-CIV-02547 DERRICK BURNS, ET AL. VS. SUNEET SINGAL, ET AL.

DERRICK BURNS SUNEET SINGAL
ADAM M. FOREST

PLAINTIFFS DERRICK BURNS AND VINCE NAKAYAMA’S MOTION FOR ISSUE SANCTION TENTATIVE RULING:

Plaintiffs’ motion for issue sanctions is DENIED.

Based on the deposition testimony of Defendant Singal, Plaintiffs assert that “the only remaining contractual dispute is over how much is owed.” (MPA, p.2) Plaintiffs further assert that “The dispute about how much First Capital owes turns on two issues: (1) usury, which Singal and First Capital asserted as an affirmative defense and as a claim in their cross-complaint; and (2) the question of whether the Note’s interest rate should be calculated as simple or compound.” (MPA, p.2-3) Accordingly, Plaintiffs represent that resolution of the present dispute depends solely on the terms of the parties’ agreement.

The best evidence of the terms of the parties’ agreement, however, is the agreement itself. Indeed, it’s not clear that extrinsic evidence obtained through discovery will be relevant or admissible in determining the terms of the agreement. Further, the threshold issues of whether the alleged agreement is valid and enforceable, and which Defendants are bound by the agreement, must be determined before the court rules on the terms of the agreement. While Plaintiffs may choose to rely on Defendant Singal’s deposition testimony as support for their position that a valid agreement exists, that testimony is ultimately not dispositive of the issues of whether the parties’ agreement is valid or enforceable under Delaware law or otherwise. The sanctions requested by Plaintiffs do not relieve the court of the task of determining these threshold issues.

If the tentative ruling is uncontested, it shall become the order of the Court. Thereafter, counsel for Plaintiffs shall prepare a written order consistent with the Court’s ruling for the Court’s signature, pursuant to California Rules of Court, Rule 3.1312, and provide written notice of the ruling to all parties who have appeared in the action, as required by law and the California Rules of Court.