Lopes et al v. Vieira et al

Filing 312

ORDER GRANTING Motion for Summary Judgment by defendant Downey Brand LLP against plaintiff Maria Machado as trustee of the Machado Famiy Trust, signed by Judge Oliver W. Wanger on 10/12/2010. (Kusamura, W)

Lopes et al v. Vieira et al

Doc. 312

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J A M E S R. KIRBY II (SBN 088911) S E G A L & KIRBY LLP 7 7 0 L Street, Suite 1440 S a c ra m e n to , CA 95814 T e le p h o n e : [phone] F a c s im ile : [phone] A tto rn e ys for Defendant DOW N E Y BRAND LLP

5 6 U N IT E D STATES DISTRICT COURT 7 E A S T E R N DISTRICT OF CALIFORNIA 8 F R E S N O DIVISION 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 D e fe n d a n ts 25 26 27 28 / Defendant Downey Brand LLP (Downey Brand or the firm) has moved for s u m m a ry judgment on all causes of action asserted against the firm by Plaintiff M a ria Machado as trustee for the Machado Family Trust (the Trustee).
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M A N U E L LOPES and MARIANA L O P E S , dba LOPES DAIRY; R A Y M O N D LOPES; JOSEPH L O P E S and MICHAEL LOPES, in d ivid u a lly and dba W E S T S ID E H O L S T E IN ; ALVARO M A C H A D O and TONY ESTEVAM, P la in tiffs , vs .

C A S E NO. 1:06-CV-01243-OW W -S M S

O R D E R GRANTING MOTION FOR S U M M AR Y JUDGMENT BY DEFENDANT D O W N E Y BRAND LLP AGAINST P L AIN T IF F MARIA MACHADO AS T R U S T E E OF THE MACHADO FAMILY TRUST

G E O R G E VIEIRA; MARY V IE IR A ;C A L IF O R N IA MILK M A R K E T , a California Corporation; V A L L E Y GOLD, LLC, a California J u d g e Oliver W. Wanger L im ite d Liability Company; GENSKEM U L D E R , LLP a California Limited L ia b ility Partnership; ANTHONY C A R Y ; DOW N E Y BRAND LLP, a C a lifo rn ia Limited Liability P a rtn e rs h ip ; CENTRAL VALLEY D A IR Y M E N , INC. a California Food a n d Agricultural Nonprofit C o o p e ra tive Association, and DOES 1 through 25, inclusive,

Dockets.Justia.com

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T h e Trustee asserts claims against Downey Brand on behalf of Alvaro M a c h a d o , deceased (Machado), for alleged violations of 15 U.S.C. §78j(b) and S e c u ritie s and Exchange Commission Rule 10b-5 (Fourth Cause of Action) and C a lifo rn ia Corporations Code Section 54000(d) (Fifth Cause of Action) as well as c o m m o n law claims for negligence, intentional misrepresentation and negligent m is re p re s e n ta tio n (Sixth through Eighth Causes of Action). Second Amended C o m p la in t at 30: 2 - 43: 12. Downey Brand's motion is granted on all causes of a c tio n for the following reasons: T h e Court finds it is undisputed that Machado did not purchase a security. Downey Brand's Undisputed Fact (DBUF) 2. Because Machado did not purchase a security, the Trustee cannot establish his federal or state securities fraud claims. See Blue Chip Stamps v. Manor Drug Stores, 421 U.S. 723, 735-736 (1975); K a m e n v. Lindly, 94 Cal.App.4th 197, 206 (2001). A s to the Trustee's common law claims, the Court finds she has failed to c re a te triable issues and the following facts are undisputed: Downey Brand never re p re s e n te d Central Valley Dairymen, Inc. (CVD), the cooperative to which M a c h a d o belonged, DBUF 1; Machado did not read any of the documents a s s o c ia te d with the Valley Gold offering to investors or those prepared by Valley G o ld 's accountants, DBUF 3; and he never retained Downey Brand to represent h im nor has he ever spoken to, or heard anything said by, a Downey Brand a tto rn e y, DBUF 4. T h e Trustee submits no evidence Downey Brand intended, or had reason to e xp e c t, that any misrepresentation concerning Valley Gold would be repeated and a c te d upon by a person who did not invest in Valley Gold. Nor does she present e vid e n c e that Machado's friends upon whom he may have relied were acting as h is agents. Assuming the Trustee has placed in issue an "indirect representation" c a u s e of action, she submits no evidence to establish the necessary elements of s u c h a claim. See Lovejoy v. AT&T Corp., 92 Cal.App. 4th 85, 94 (2001).
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D o w n e y Brand did not have an attorney-client relationship with Machado g ivin g rise to a duty to disclose facts nor did the firm represent CVD. See g e n e ra lly Fox v. Pollack, 181 Cal.App. 3d 954, 960-61(1986). Downey Brand's re p re s e n ta tio n of Valley Gold, an entity, did not create an attorney-client re la tio n s h ip between Downey Brand and Machado giving rise to a duty to d is c lo s e . See, e.g., La Jolla Cove Motel and Hotel Apartments, Inc. v. Superior C o u rt, 121 Cal.App.4th 773, 784 (2004); Cal. R. Professional Conduct 3-600(E). T h e re fo re , for the reasons set forth in more particular in the Court's S e p te m b e r 27, 2010 Memorandum of Decision IT IS HEREBY ORDERED THAT: D o w n e y Brand's motion for summary judgment against Plaintiff Maria M a c h a d o as trustee for the Machado Family Trust on the Second Amended C o m p la in t is GRANTED.

SO ORDERED.

D a te d : October 12, 2010

/s / OLIVER W . W A N G E R U n ite d States District Judge

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