Filed 6/24/14 Polaris Medical Academy v. Allen CA4/3



                      NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.


              IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                                     FOURTH APPELLATE DISTRICT

                                                 DIVISION THREE

POLARIS MEDICAL ACADEMY, LLC,
et al.,
                                                                       G045800
   Plaintiffs, Cross-defendants and
Respondents,                                                           (Super. Ct. No. 30-2008-00110096)

         v.                                                            OPINION

MICHAEL ALLEN,

   Defendant, Cross-complainant and
Appellant;

POLARIS MEDICAL ACADEMY
CORPORATION,

     Defendant and Appellant.


                   Appeal from a judgment of the Superior Court of Orange County,
Robert J. Moss, Judge. Affirmed as modified. Request for judicial notice. Granted.
                   Wellman & Warren, Scott W. Wellman and Derek Banducci for Defendant,
Cross-complainant and Appellant and for Defendant and Appellant.
                   Law Offices of Allan E. Perry and Allan E. Perry for Plaintiffs,
Cross-defendants and Respondents.
                                             *               *               *
                                      INTRODUCTION
              Polaris Medical Academy, LLC (Polaris LLC), Touraj Jahangiri
(T. Jahangiri), Reza Jahangiri (R. Jahangiri), and Farid Larijani (collectively referred to
as Plaintiffs) sued Michael Allen and Polaris Medical Academy Corporation (Polaris
Corp.) for various legal and equitable causes of action. Allen pursued a cross-complaint
against Plaintiffs. Following a jury trial on the legal causes of action and a bench trial on
the equitable causes of action, a judgment was entered awarding $400,000 in damages to
Polaris LLC and $50,000 in damages to Allen, and issuing an injunction against Allen
and Polaris Corp. The judgment stated Polaris LLC, T. Jahangiri, and Larijani “shall
recover . . . attorneys’ fees in the amount of _____.”
              Allen and Polaris Corp. appeal from the judgment. They did not file a
separate notice of appeal from the postjudgment orders denying Allen’s motion for
attorney fees and granting Plaintiffs’ motion for attorney fees in the amount of about
$498,000.
              We conclude (1) we have jurisdiction over Allen’s challenge to the portion
of the judgment stating Polaris LLC, T. Jahangiri, and Larijani shall recover attorney
fees, and affirm that portion of the judgment; (2) the trial court did not err by granting
nonsuit on Allen’s causes of action for intentional misrepresentation and negligent
misrepresentation; and (3) there is no evidence to show the existence of several items
which the injunction requires Allen and Polaris Corp. to return. Accordingly, we modify
the injunctive relief portion of the judgment and, in all other respects, affirm the
judgment as so modified.
                                           FACTS
              Polaris LLC was formed as a California limited liability company in
February 2007. Its primary purpose was to provide certified instruction to cardiologists
in the use of radiological equipment to diagnose cardiovascular conditions.

                                              2
               Allen, T. Jahangiri, R. Jahangiri, and Larijani entered into an operating
agreement for Polaris LLC (the Operating Agreement). Under the Operating Agreement,
T. Jahangiri received a 51 percent interest, R. Jahangiri received a 29 percent interest,
Allen received a 10 percent interest, and Larijani received a 10 percent interest, in Polaris
LLC. Allen became the chief financial officer and chief operating officer and received a
base annual salary of $120,000.
               According to Polaris LLC’s business plan, “Jahangiri Financing” was to
account for $403,120 in financing. Such financing was not provided. In June 2007,
Allen approached R. Jahangiri and asked him to prove he and T. Jahangiri had the funds
to invest in Polaris LLC. R. Jahangiri showed Allen a compilation of bank statements
that renewed Allen’s belief T. Jahangiri and R. Jahangiri could and would invest in
Polaris LLC.
               Polaris LLC began conducting classes in July 2007. By March 2008, it had
received more than $300,000 in gross revenue. However, in January 2008, Allen
reported that Polaris LLC was “technically insolvent” and had a negative net worth.
               At a meeting on February 2, 2008, the members of the board voted to
dissolve Polaris LLC and to terminate the employment of all employees, including Allen.
The board tentatively divided the corporate assets among the members and agreed to
meet later to discuss completing the dissolution. Allen understood his employment as an
officer of Polaris LLC was terminated effective February 29, 2008.
               The locks to the entrances of the Polaris LLC corporate offices were
changed so that Allen could not gain entry. Allen was locked out because Larijani had
reason to believe that Allen had removed some items from the corporate offices and
Larijani did not want him to remove anything else.
               Allen formed Polaris Corp., had it incorporated in March 2008, and served
as its chief executive officer. Polaris Corp. offered classes to train cardiologists and
radiologists in using medical imaging equipment. Allen used the Polaris LLC Web site

                                              3
domain, teaching materials, and equipment and office furniture. He changed the street
address of Polaris LLC to the new address of Polaris Corp. and changed the password
settings of the Polaris LLC Web site.


                                   PROCEDURAL HISTORY
               Plaintiffs’ second amended complaint (the Complaint) asserted causes of
action against Allen and Polaris Corp. for, among other things, declaratory relief,
conversion, breach of contract, and violations of California’s unfair competition law,
Business and Professions Code section 17200 et seq. Allen pursued a cross-complaint
(the Cross-complaint) against Plaintiffs for, among other things, declaratory relief, breach
of oral contract, promissory estoppel, false promise fraud, intentional misrepresentation,
and negligent misrepresentation.
               The legal and equitable causes of action were bifurcated, and the legal
causes of action were tried to a jury. During the jury trial, the court granted Plaintiffs’
motions for nonsuit on the causes of action in the Cross-complaint for intentional
misrepresentation and negligent misrepresentation.
               On the Complaint, the jury found in favor of T. Jahangiri and Larijani and
against Allen on the cause of action for breach of contract, and found in favor of Polaris
LLC and against Allen and Polaris Corp. on the cause of action for conversion. The jury
awarded no damages to T. Jahangiri and Larijani, and awarded $400,000 in damages to
Polaris LLC.
               On the Cross-complaint, the jury found in favor of Polaris LLC and against
Allen on the cause of action for breach of the employment agreement, and found in favor
of Allen and against Polaris LLC on the cause of action for breach of an agreement to
reimburse expenses. The jury awarded Allen $50,000 in damages. The jury found in
favor of T. Jahangiri and R. Jahangiri and against Allen on a cause of action for breach of
an agreement to invest at least $500,000 in Polaris LLC.

                                              4
              After receiving the jury’s verdict, the trial court decided the equitable
issues. On the Complaint, the court found that Allen had engaged in unfair business
practices in violation of Business and Professions Code section 17200 and issued an
injunction requiring Allen and Polaris Corp. to cease certain practices and to relinquish
possession of various items of both tangible and intangible property. On the
Cross-complaint, the court found against Allen on the cause of action for promissory
estoppel.
              In July 2011, a judgment was entered reflecting the jury verdict and the trial
court’s decision on the equitable causes of action. The judgment stated: “Plaintiffs
Polaris Medical Academy, LLC, Touraj Jahangiri and Farid Larijani shall recover costs in
the amount of $_____ and attorneys’ fees in the amount of $_____ for a total judgment of
$_____.” The trial court issued a statement of decision, the final sentence of which read,
“[t]he court will consider any motion for attorneys’ fees.”
              On September 2, 2011, the trial court denied Allen and Polaris Corp.’s
motion for a new trial and motion for a judgment notwithstanding the verdict. On
September 15, 2011, Allen and Polaris Corp. filed a notice of appeal “from the Superior
Court’s judgment entered on or about July 7, 2011.”
              In a minute order dated October 21, 2011, the trial court denied Allen’s
motion for attorney fees on the ground “Plaintiff was the prevailing party.” None of the
motion papers or opposition papers is in the record on appeal. Allen did not appeal from
the order denying his motion for attorney fees.
              In a minute order dated December 9, 2011, the trial court granted Plaintiffs’
motion for attorney fees and awarded fees in the amount of $498,406.97. None of the
motion papers or opposition papers is in the record on appeal. Neither Allen nor Polaris
Corp. appealed from this order.




                                              5
                 REQUEST FOR JUDICIAL NOTICE/ABANDONED ISSUES
              Allen and Polaris Corp. have requested we take judicial notice of a
document, entitled “Discharge of Debtor,” issued by the United States Bankruptcy Court,
Central District of California, in bankruptcy case No. 8:12-bk-13926-CB. We may take
judicial notice of this document under Evidence Code sections 452, subdivisions (c) and
(d), and 459, and we grant the request. The Discharge of Debtor granted Allen a
discharge under section 727 of title 11 of the United States Code.
              Due to Allen’s discharge in bankruptcy, Allen and Polaris Corp. state in the
reply brief: “This Court should disregard those issues for which any additional relief,
beyond a bankruptcy discharge, would be ineffectual because such issues are moot and
Allen and [Polaris Corp.] expressly abandon such issues at this time for exactly that
reason.” The abandoned issues are parts I., II., and III. of the Argument section of the
appellants’ opening brief. The remaining issues are (1) whether the trial court erred by
entering a judgment that failed to award Allen attorney fees as the prevailing party on a
contract, (2) whether the trial court erred by granting the motions for nonsuit on the
intentional misrepresentation and negligent misrepresentation causes of action, and
(3) whether the trial court’s injunction required Allen and Polaris Corp. to return items of
property that do not exist.


                                       DISCUSSION
                                             I.
                                      Attorney Fees
A. Appellate Jurisdiction
              Allen did not appeal from the postjudgment order granting Plaintiffs’
motion for attorney fees or from the order denying his motion for attorney fees. Allen
appealed only from the judgment, which stated that Polaris LLC, T. Jahangiri, and

                                             6
Larijani shall recover costs and attorney fees and left a blank for the amount. On appeal,
Allen argues the trial court erred by entering a judgment that failed to award him attorney
fees. He contends it was unnecessary for him to appeal from the postjudgment orders on
the attorney fees motions or to include those motions in the appellate record.
              Allen’s challenge to the attorney fees award creates something of a
jurisdictional conundrum. The rule is that when a party wants to challenge both a final
judgment and a postjudgment order granting or denying attorney fees, the party must file
two separate notices of appeal: An appeal from the judgment alone will not include the
attorney fees order. (Torres v. City of San Diego (2007) 154 Cal.App.4th 214, 222;
Colony Hill v. Ghamaty (2006) 143 Cal.App.4th 1156, 1171; DeZerega v. Meggs (2000)
83 Cal.App.4th 28, 43-44.)
              However, if the judgment itself declares the prevailing party is entitled to
recover attorney fees, but leaves the amount blank, the judgment is deemed to
“subsume[]” a subsequent order setting the amount of fees, so that an appeal from the
judgment confers appellate jurisdiction over a later order setting the amount of the award.
(Grant v. List & Lathrop (1992) 2 Cal.App.4th 993, 997 (Grant).) The holding in Grant
has been described as limited to the situation in which entitlement to attorney fees was
actually adjudicated by the original judgment, leaving only the question of amount to
postjudgment litigation. (DeZerega v. Meggs, supra, 83 Cal.App.4th at p. 44.)
              At oral argument, we invited the parties to submit letter briefs addressing
Silver v. Pacific American Fish Co., Inc. (2010) 190 Cal.App.4th 688, 692 (Silver), a case
neither party cited in the briefing. In Silver, the judgment provided that the
cross-defendants “‘shall recover . . . attorney fees and costs of suit,’” but left a blank for
the amount. (Ibid.) The cross-complainant argued that such language in the judgment
was sufficient to bring the case within Grant so that an appeal from the judgment
included the trial court’s later order awarding attorney fees to the cross-defendants.
(Silver, supra, at p. 692.)

                                               7
              The Court of Appeal in Silver concluded Grant did not apply because
“[n]otwithstanding the language in the judgment,” it was clear the parties subsequently
litigated in a separate postjudgment proceeding both the reasonableness of the amount of
the attorney fees being claimed and the threshold issue of entitlement to fees. (Silver,
supra, 190 Cal.App.4th at p. 692.) The judgment was based on a statement of decision
providing that the cross-defendants, as the prevailing parties, “‘may make an application
for attorney’s fees and costs by postjudgment motion for allowance of attorney’s fees as
an element of costs.’” (Ibid.) This language suggested the trial court intended, and the
parties understood, the issue of attorney fees would be litigated in a separate
postjudgment application. (Ibid.) In their motion for attorney fees, the cross-defendants
argued the threshold issue of entitlement to fees under Code of Civil Procedure
section 1032 and Civil Code section 1717, and the cross-complainant argued the
cross-defendants were not the prevailing parties. (Silver, supra, at p. 693.) In the minute
order granting the motion, the trial court adjudicated both entitlement to attorney fees and
the reasonableness of the amounts claimed. (Ibid.) “Under these circumstances,” the
Court of Appeal stated, “[the cross-complainant] was not misled into believing that the
trial court had adjudicated prior to or in the judgment the issue of entitlement to attorney
fees.” (Ibid.) The court concluded the cross-complainant could not rely on the appeal
from the judgment to challenge attorney fees, but was required to file a separate, timely
notice of appeal from the postjudgment order awarding attorney fees. (Id. at p. 694.)
              The judgment in this case includes a statement that judgment be entered in
favor of Polaris LLC, T. Jahangiri, and Larijani, and expressly stated they are to recover
attorney fees. In contrast, in the statement of decision, the trial court stated only, “[t]he
court will consider any motion for attorneys’ fees.” Therefore, from the judgment and
the statement of decision it is not clear the trial court intended, and the parties
understood, whether the issue of entitlement to attorney fees would be litigated in
postjudgment proceedings. Although Allen brought his own postjudgment motion for

                                               8
attorney fees, he might have done so out of caution and to preserve his rights in the event
a court later would determine the judgment did not adjudicate entitlement to fees. We
conclude Silver is distinguishable and we have jurisdiction over Allen’s challenge to the
award of attorney fees to Polaris LLC, T. Jahangiri, and Larijani.

B. The Merits
              Allen argues the trial court erred by failing to award him attorney fees on
Plaintiffs’ cause of action for breach of contract. As Plaintiffs emphasize, none of the
attorney fees motion papers or opposition papers is in the appellate record. Allen argues
the motion papers and opposition papers are unnecessary because, based on the terms of
the judgment alone, Allen was the “unqualified victor” on the breach of contract action
against T. Jahangiri and Larijani. In effect, Allen argues that, as a matter of law, based
on the jury verdict alone, he was entitled to recover attorney fees as the prevailing party
on the breach of contract cause of action.
              The basis for recovery of attorney fees is section 19.12 of the Operating
Agreement, which states, “[i]n the event that any dispute between the Company and the
Members or among the Members should result in litigation or arbitration, the prevailing
party in such dispute shall be entitled to recover from the other party . . . reasonable
attorneys’ fees and expenses.” (Italics added.)
              Section 19.12 of the Operating Agreement is not limited to breach of
contract, but was drafted broadly to include any dispute. A contractual attorney fees
provision may be drafted broadly enough to support an award of attorney fees in
noncontract actions. (Santisas v. Goodin (1998) 17 Cal.4th 599, 610; Maynard v. BTI
Group, Inc. (2013) 216 Cal.App.4th 984, 991-992; Lockton v. O’Rourke (2010) 184
Cal.App.4th 1051, 1076; Chinn v. KMR Property Management (2008) 166 Cal.App.4th
175, 182, 183.) “If the attorney fee provision does encompass noncontractual claims, the
prevailing party entitled to recover fees normally will be the party whose net recovery is


                                              9
greater, in the sense of most accomplishing its litigation objectives.” (Maynard v. BTI
Group, Inc., supra, at p. 992.)
              The Complaint and the Cross-complaint raised several disputes between the
parties which fell within section 19.12 of the Operating Agreement. The Cross-complaint
asserted causes of action against Plaintiffs for declaratory relief; against Polaris LLC,
T. Jahangiri, and R. Jahangiri for breach of oral contract and promissory estoppel; against
Polaris LLC and T. Jahangiri for false promise fraud; and against T. Jahangiri and
R. Jahangiri for intentional misrepresentation and negligent misrepresentation. The trial
court granted nonsuit against Allen on the intentional misrepresentation and negligent
misrepresentation causes of action. The jury found against Allen on the
Cross-complaint’s claim for breach of a contract to invest in Polaris LLC.
              After trial of the equitable causes of action, the trial court found against
Allen on the Cross-complaint’s cause of action for promissory estoppel. Allen did not
prevail on his declaratory relief cause of action. The court found that Allen had a
10 percent interest in Polaris LLC, while the Cross-complaint sought a declaration he
owned a majority interest. Although the jury awarded T. Jahangiri and Larijani no
damages for breach of contract, the jury awarded Polaris LLC $400,000 in damages
against Allen for conversion. The jury awarded Allen no damages against T. Jahangiri,
R. Jahanjiri, or Larijani.
              The orders on the attorney fees motions confirm the judgment correctly
determined that Polaris LLC, T. Jahangiri, and Larijani are entitled to recover attorney
fees. In the order denying Allen’s motion for attorney fees, the trial court found that
“Plaintiff was the prevailing party.” In the order granting Plaintiffs’ motion for attorney
fees, the trial court found that “Plaintiffs were clearly the prevailing party on their claim
for breach of the operating agreement” and “Allen failed to prevail on any of the cross–
claims.” The court found, in effect, the jury did not award T. Jahangiri and Larijani



                                              10
damages for breach of contract only because it had awarded Polaris LLC damages for
conversion and had been instructed not to award duplicative damages.
              Thus, under the record presented to us, the trial court did not err by finding
Polaris LLC, T. Jahangiri, and Larijani were the prevailing parties “in the sense of most
accomplishing [their] litigation objectives.” (Maynard v. BTI Group, Inc., supra, 216
Cal.App.4th at p. 992.) The judgment correctly stated they shall recover attorney fees.
                                             II.
                                          Nonsuit
A. Background
              During the jury trial, Plaintiffs brought oral motions for nonsuit on Allen’s
causes of action for false promise fraud against Polaris LLC and T. Jahangiri, and for
intentional misrepresentation and negligent misrepresentation against T. Jahangiri and
R. Jahangiri. Plaintiffs argued Allen failed to present sufficient evidence to establish the
elements of those causes of action.
              In granting nonsuit on the intentional misrepresentation cause of action, the
trial court stated: “I don’t see any evidence of intent to deceive by anybody, frankly on
either side. I think they have differences. They couldn’t resolve them. There was some
[contractual]-type differences, and I don’t see any substantial evidence of intent to
deceive of which would be necessary for a fraud cause of action.” The trial court granted
nonsuit on the negligent misrepresentation cause of action “for the same reasons.” The
court deferred ruling on the motion on the promissory estoppel cause of action because it
is equitable. The trial court later found against Allen on the promissory estoppel cause of
action. He does not challenge that decision in this appeal.

B. Standard of Review
              We review an order granting nonsuit de novo, using the same standard as
the trial court. (Nally v. Grace Community Church (1988) 47 Cal.3d 278, 291.) A


                                             11
defendant is entitled to a nonsuit if the court determines, as a matter of law, the evidence
presented by the plaintiff is insufficient to permit a jury to find in the plaintiff’s favor.
(Ibid.) The court must not weigh the evidence or consider witness credibility, must
accept as true the evidence most favorable to the plaintiff, must disregard conflicting
evidence, and must draw every reasonable inference—and resolve all presumptions,
conflicts, and doubts—in the plaintiff’s favor. (Castaneda v. Olsher (2007) 41 Cal.4th
1205, 1214-1215.) Evidence is legally insufficient when no substantial evidence exists
tending to prove each element of the plaintiff’s claim. (Adams v. City of Fremont (1998)
68 Cal.App.4th 243, 263; Fountain Valley Chateau Blanc Homeowner’s Assn. v.
Department of Veterans Affairs (1998) 67 Cal.App.4th 743, 750-751.)

C. Intentional Misrepresentation and Negligent Misrepresentation
       1. Elements
              The elements of intentional misrepresentation are (1) the defendant made a
false representation as to a past or existing material fact; (2) the defendant knew the
representation was false at the time it was made; (3) in making the representation, the
defendant intended to defraud the plaintiff; (4) the plaintiff justifiably relied on the
representation; and (5) the plaintiff suffered resulting damages. (Lazar v. Superior Court
(1996) 12 Cal.4th 631, 638.) The elements of negligent misrepresentation are (1) the
defendant made a representation as to a past or existing material fact; (2) the defendant
made the misrepresentation without reasonable ground for believing it to be true; (3) the
defendant made the representation with intent to induce the plaintiff’s reliance on it;
(4) the plaintiff justifiably relied on the representation; and (5) the plaintiff suffered
resulting damages. (Wells Fargo Bank, N.A. v. FSI, Financial Solutions, Inc. (2011) 196
Cal.App.4th 1559, 1573.)




                                               12
       2. Evidence Supporting Causes of Action
              According to Allen, the following evidence supported his causes of action
for intentional misrepresentation and negligent misrepresentation:
              A business plan for Polaris LLC (exhibit No. 208) represented “Jahangiri
Financing” would provide over $400,000 in financing. This financing was not provided.
Allen testified he was concerned whether T. Jahangiri and R. Jahangiri would be able to
invest in Polaris LLC. In June 2007, Allen approached R. Jahangiri and asked him to
prove he had the funds to invest in Polaris LLC. Allen said, “show me. Show me that
you have the funds to invest.” He testified that “[p]rior to that there were no indications
that funds were going to be infused into Polaris [LLC] or Polaris Imaging, and I wanted
to confirm that they had certificates of deposit or funds in their bank accounts to fund
these two companies.”
              In response, R. Jahangiri showed Allen the bank statements from Imaging
Venture Group, Inc. (IVG), which comprised exhibit No. 254. Allen testified he saw
those statements on June 12, 2007 and seeing the bank statements “renewed my faith that
the Jahangiris were going to invest in the companies. They had the funds to invest, and
                                                                       1
actually had an intention to follow through what they promised me.”
              Millions of dollars flowed in and out of the IVG bank account because IVG
was in the business of selling high-priced medical equipment. R. Jahangiri explained,
“money would come in and out, and the difference between the purchase price and my
price for the equipment would be our profit. So a lot of money would come in here in
connection with financing and selling this equipment.” Due to an overpayment, the

 1
    In his reply brief, Allen argues he testified: “[W]hen I looked at those records, clearly
I saw transactions of $1.6 million dollars being deposited, bank balances moving up
between one million to 11 million dollars, and frankly I looked at those statements and I
said ‘wow, I’m impressed. So you do have the funds.’” However, the trial court granted
a motion to strike this testimony as nonresponsive, and Allen does not challenge that
ruling.

                                             13
account balances were inflated by several million dollars. R. Jahangiri testified: “Mike
Allen knew that there was four and a half to $5 million dollars, I verbally told him, that
was over wired [verbatim] by IBM, which was kind of unbelievable, and that money
stayed in the account for upwards of six months.”
       3. Intentional Misrepresentation
              Exercising de novo review, we reach the same conclusion as the trial court
did on the intentional misrepresentation cause of action. Proof of fraudulent intent may
be, and most likely can only be, evidence of the circumstances surrounding the
transaction and of the relationship and interest of the parties. (Miller v. National
American Life Ins. Co. (1976) 54 Cal.App.3d 331, 338.) Allen argues an inference of
intent to defraud can be drawn from the fact that R. Jahangiri represented he and
T. Jahangiri would provide over $400,000 in financing for Polaris LLC but failed to do
so. But failure to act in accordance with a representation is not enough to prove
fraudulent intent. (Cf. Tenzer v. Superscope, Inc. (1985) 39 Cal.3d 18, 30 [“‘something
more than nonperformance is required to prove the defendant’s intent not to perform his
promise’”].) In this case, a reasonable inference of intent to defraud could not be drawn
from the evidence presented.
       4. Negligent Misrepresentation
              The trial court granted nonsuit on the negligent misrepresentation cause of
action “for the same reasons” as granting nonsuit on the intentional misrepresentation
cause of action. Allen is correct that intent to defraud is not an element of negligent
misrepresentation. However, we may affirm a nonsuit on any ground advanced in the
trial court if the opposing party was given notice of the defect and an opportunity to cure
it. (Jensen v. Hewlett-Packard Co. (1993) 14 Cal.App.4th 958, 971; Loral Corp. v.
Moyes (1985) 174 Cal.App.3d 268, 273.) Plaintiffs moved for nonsuit on the negligent
misrepresentation cause of action on the ground Allen failed to meet his burden of proof
on all of the elements.

                                             14
              Our de novo review of the record leads us to conclude Allen failed to
produce legally sufficient evidence of the first two elements of negligent
misrepresentation: A misrepresentation of a past or existing material fact made without
reasonable ground for believing it to be true. Exhibit No. 208, the Polaris LLC business
plan, represented that T. Jahangiri and R. Jahangiri would provide over $400,000 in
financing. Allen presented no evidence that statement was untrue when it was made or
there was no reasonable ground for believing it to be true. When Allen asked for
confirmation that financing would be provided, R. Jahangiri provided him exhibit
No. 254, the IVG bank statements. No evidence was presented those banks statements
were false. Allen knew $4.5 million to $5 million reflected in those statements were for
an overpayment and would have to be repaid.
                                            III.
                                     Injunctive Relief
              Allen and Polaris Corp. argue the trial court erred by issuing an injunction
requiring them to return these items: (1) “The Polaris Medical Academy license,
including but not limited to the CME certificate number and SCCT ID number”;
(2) “Historical Google Analytics data related to the website”; (3) “16 chairs”; (4) 16
Del[l] computers and workstations”; and (5) “TeraRecon software with multiple user
licenses.” Allen and Polaris Corp. argue there is no evidence in the record to show the
existence of those items. They objected to the proposed judgment on the ground those
items do not exist and claim they were added to the judgment “for no apparent reason.”
              Plaintiffs do not respond to this argument other than to assert substantial
evidence supported “[the trial court’s] subsequent decision to order the return of the
converted property.” Plaintiffs have provided no citations to the record showing that any
of the five items described by Allen and Polaris Corp. do indeed exist. Since Allen and
Polaris Corp. cannot be compelled to return what does not exist, the injunctive relief
portion of the judgment will be modified accordingly.

                                            15
                                     DISPOSITION
             The judgment is modified in part by striking the following quoted matter:
             1. On page 5, lines 3-4, “1. The Polaris Medical Academy license,
including but not limited to the CME certificate number and SCCT ID number.”
             2. On page 5, line 19, “f. Historical Google Analytics data related to the
website.”
             3. On page 5, in line 20, “16 chairs.”
             4. On page 5, in lines 22-23, “16 Del computers and workstations.”
             5. On page 6, in lines 5-6, “TeraRecon software with multiple user
licenses.”
             As modified, and in all other respects, the judgment is affirmed.
Respondents shall recover costs incurred on appeal.




                                                FYBEL, ACTING P. J.

WE CONCUR:



IKOLA, J.



THOMPSON, J.




                                           16
