Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_14-cv-00288/USCOURTS-caed-1_14-cv-00288-21/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Other Contract

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UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF CALIFORNIA

MP NEXLEVEL OF CALIFORNIA, INC.,

 Plaintiff, 

 v. 

CVIN, LLC, et al.,

 Defendants.

1:14-cv-288-LJO-EPG

MEMORANDUM DECISION AND 

ORDER RE PLAINTIFF’S MOTION 

FOR JUDGMENT (Doc. 391) AND 

DEFENDANT’S MOTION TO 

BIFURCATE (Doc. 396)

I. INTRODUCTION

The Court recently denied Plaintiff-Counter Defendant MP Nexlevel of California, Inc.’s (“MP”) 

motion for summary judgment on Defendant-Counter Claimant CVIN, LLC’s (“CVIN”) counterclaim 

brought under California Business and Professions Code § 7031(b) (“§ 7031(b)”). See MP Nexlevel of 

Calif., Inc. v. CVIN, LLC, No. 1:14-cv-288-LJO-EPG, 2016 WL 3916987 (E.D. Cal. July 19, 2016) 

(“the MSJ Order”). Currently before the Court is (1) MP’s motion for entry of judgment on that order

under Federal Rule of Civil Procedure154(b) or, in the alternative, certification of the order for 

interlocutory appeal under 28 U.S.C. § 1292(b) (“§ 1292(b)”)2(Doc. 391) and (2) CVIN’s motion to 

bifurcate the trial. Doc. 396.

The Court took both matters under submission on the papers pursuant to Local Rule 230(g). 

Docs. 403, 406. For the following reasons, the Court DENIES MP’s motion and GRANTS CVIN’s 

 

1 All further references to any “Rule” are to the Federal Rules of Civil Procedure.

2 MP further requests that if the MSJ Order is certified for interlocutory appeal that the Court stay this case. Doc. 391-1 at 2. 

Because the Court denies MP’s motion for interlocutory appeal, its request for a stay is DENIED as moot.

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motion.

II. FACTUAL AND PROCEDURAL BACKGROUND

This case concerns disputes that arose over a large-scale broadband infrastructure construction 

project (“the Project”) throughout California’s Central Valley, which is divided into 30 “Segments.” 

MSJ Order at *1-2. The Segments are further divided into two geographical groups, the “Northern 

Segments” and the “Southern Segments.” See Doc. 391-1 at 6. When performing construction on the 

Southern Segments, MP had only a C-7 Low Voltage Systems license (“C-7 license”), issued by the 

California Contractors State License Board (“the Board). Id. Before performing construction on the 

Northern Segments, MP obtained a Board-issued “Class A” license. Id.

California Business and Professions Code § 7031 (“§ 7031”) bars contractors from any recovery 

or compensation for work requiring an appropriate contractor’s license unless he or she was “duly 

licensed” throughout the performance of the work. See MW Erectors, Inc. v. Niederhauser Ornamental 

& Metal Works Co., Inc., 36 Cal. 4th 412, 426 (2005). CVIN brought a counterclaim against MP, 

arguing that MP is barred under § 7031 from maintaining this case because MP was not “duly licensed” 

when it performed its work on the Project and, accordingly, CVIN is entitled to recover all 

compensation it paid for the work. MSJ Order at *1, 4. MP moved for summary judgment on the claim, 

which the Court denied, finding that: (1) MP was not duly licensed by virtue of its C-7 license; (2) MP’s 

work was not “incidental and supplemental” to work covered by its C-7 license3; and (3) genuine issues 

of material fact remain as to whether MP’s Class A license was valid, which precludes any decision on 

whether it rendered MP duly licensed. Id. at 8-9.

MP now seeks to appeal the MSJ Order.4To do so, MP requests that the Court either enter 

 

3 Under California Business and Professions Code § 7059(a), a licensee is permitted to perform work that it may not be 

licensed to perform if the work is “incidental and supplemental” to the work for which it is licensed to perform. See MSJ 

Order at *7. Because the Court concluded MP’s C-7 license was insufficient and its work was not “incidental and 

supplemental” to work covered by its C-7 license, MP was not duly licensed when it held only that license.

4 Third-Party Defendant JK Communications & Construction, Inc. dba Kleven Construction (“Klevens”) joins in full MP’s 

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judgment on CVIN’s counterclaim under Rule 54(b) or certify the Order for interlocutory appeal under 

§ 1292(b). See Doc. 391-1 at 7.

CVIN opposes on both grounds.5 Doc. 395. As to MP’s motion under Rule 54(b), CVIN argues, 

among other things, that the MSJ Order cannot be appealed under the Rule because it is not a final 

decision. Id. at 10. As to MP’s § 1292(b) motion, CVIN asserts MP fails to satisfy any of its three 

criteria. Id. at 16.

The parties agree that if MP’s Class A license is invalid, then MP is barred under § 7031 from 

asserting its remaining claims that the MSJ Order does not affect.6The merits of MP’s claim therefore 

would effectively be decided and no trial on the claims (or CVIN’s counterclaims), which is estimated to 

take approximately 40 days, would be necessary. For that reason, CVIN moves to bifurcate the trial so 

that the threshold question of MP’s licensure, which will have to be decided at the trial currently 

scheduled for July 2017, can be decided in advance. Doc. 397 at 1. If CVIN is successful, CVIN will 

agree to a stay of the case and the entry of judgment on its claims, which would permit an appeal of both 

licensure issues. Id. at 8.

Only MP opposes CVIN’s motion to bifurcate. Doc. 404. MP argues the licensure trial would be 

an inefficient waste of resources because any result would be moot if the Ninth Circuit holds MP’s C-7 

license was valid and sufficient. MP also argues that the Class A licensure issue is not separable from 

the merits and therefore the evidence presented at a trial on the issue would “overlap significantly with 

 

motion to the extent it requests an appeal of the MSJ Order, but opposes staying the case if the Court were to grant the 

motion. As noted, the Court denies MP’s motion and will not stay this case. The Court therefore need not address Kleven’s 

arguments.

5 Defendants Calaveras Communications Company, Cal-Ore Telephone Co., Consolidated Communications Holdings, Inc., 

Ducor Telephone Company, Mohave Investment, LLC, Sebastian Enterprises, Inc., Sierra Tel Broadband, Sierra Tel 

Communications Group, Stageline Communications, Inc., Surewest Fiber Ventures, LLC, The Ponderosa Telephone Co., 

Varcomm, Inc., Varnet, Inc., Volcano Communications Company, and Volcano Telecom, Inc. (collectively, “the Member 

Defendants”) join in full CVIN’s opposition to MP’s motion as well as CVIN’s motion to bifurcate. Doc. 398 at 2. The Court 

need not address the Member Defendants’ arguments to resolve the pending motions.

6 As discussed in more detail below, the Court agrees with the parties that the practical effect of the MSJ Order is that MP 

cannot recover on its claims concerning the Southern Segments because they are contingent on a finding that MP’s C-7 

license was valid and sufficient for the work it performed on those Segments. 

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the evidence the jury will be asked to consider at a full trial on the merits” of the parties’ claims. Id. at 5.

III.DISCUSSION

A. MP’s Rule 54(b) motion

Rule 54(b) provides in relevant part:

When an action presents more than one claim for relief – whether as a claim, counterclaim, 

crossclaim, or third-party claim – or when multiple parties are involved, the court may direct 

entry of a final judgment as to one or more, but fewer than all, claims or parties only if the court 

expressly determines that there is no just reason for delay.

When deciding a Rule 54(b) motion, the “district court must first determine that it has rendered a ‘final 

judgment,’ that is, a judgment that is an ultimate disposition of an individual claim entered in the course 

of a multiple claims action.’” Wood v. GCC Bend, LLC, 422 F.3d 873, 878 (9th Cir. 2005) (citation and 

quotation marks omitted). “Then it must determine whether there is any just reason for delay.” Id.

MP requests that the Court certify the MSJ Order, which denied its motion for summary 

judgment, for appeal under Rule 54(b). “An order denying a motion for summary judgment is generally 

not a final decision within the meaning of [28 U.S.C] § 1291 and is thus generally not immediately 

appealable.” Plumhoff v. Rickard, 134 S.Ct. 2012, 2018 (2014) (citation omitted). In fact, the Ninth 

Circuit holds that such an order generally is not appealable even if the district court certifies it for appeal 

under Rule 54(b). Safe Flight Instrument Corp. v. McDonnell–Douglas Corp., 482 F.2d 1086, 1093 (9th 

Cir. 1973).

This is so because a decision is a “final judgment” for Rule 54(b) purposes if it “ends the 

litigation on the merits and leaves nothing for the court to do but execute the judgment.” Gulfstream 

Aerospace Corp. v. Mayacamas Corp., 485 U.S. 271, 275 (1988) (citation and quotation marks omitted). 

In other words, “[a] district court may certify its judgment as final . . . only with respect to claims that 

have been conclusively resolved.” Howell v. Town of Ball, 827 F.3d 515 (5th Cir. 2016). 

The parties correctly agree that, as a result of the MSJ Order, CVIN effectively succeeded on 

MP’s claims that relate to the Southern Segments, and is entitled to a disgorgement from MP for the 

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amounts paid on those Segments. But the MSJ Order did not touch on, much less resolve, any damages 

or remedies issues. Accordingly, it is not a final decision under 28 U.S.C. § 1291 and cannot be certified 

for a Rule 54(b) appeal.7See Liberty Mut. Ins. Co. v. Wetzel, 424 U.S. 737, 744 (1976) (holding orders 

that leave “assessment of damages or awarding of other relief . . . to be resolved have never been 

considered to be ‘final’ within the meaning of 28 U.S.C. § 1291” (citations omitted)). The Court 

therefore DENIES MP’s Rule 54(b) motion.

B. MP’s § 1292(b) motion

The “only possible authorization” for an appeal from the MSJ Order is under § 1292(b). Id. “A 

non-final order may be certified for interlocutory appeal [under § 1292(b)] where it ‘involves a 

controlling question of law as to which there is substantial ground for difference of opinion’ and where 

‘an immediate appeal from the order may materially advance the ultimate termination of the litigation.’”

Reese v. BP Exploration (Alaska), Inc., 643 F.3d 681, 687-88 (9th Cir. 2011) (quoting § 1292(b)).

Because § 1292(b) “must be construed narrowly,” interlocutory appeals under § 1292(b) are permitted 

only in “rare circumstances,” James v. Price Stern Sloan, Inc., 283 F.3d 1064, 1067 n.6 (9th Cir. 2002), 

and should “act[] as a safety valve for serious legal questions taking the case out of the ordinary run.” 

Estate of Kennedy v. Bell Helicopter Textron, Inc., 283 F.3d 1107, 1116 (9th Cir. 2002) (citation and 

quotation marks omitted). 

Congress “did not specifically define what it meant by ‘controlling,’” in § 1292(b)’s requirement 

that an interlocutory appeal present a “controlling question of law.” In re Cement Antitrust Litig. (MDL 

No. 296), 673 F.2d 1020, 1026 (9th Cir. 1982). The Ninth Circuit broadly defines it as one whose 

“resolution . . . on appeal could materially affect the outcome of litigation in the district court,” id., but

has not provided much meaningful guidance beyond that. Though the Ninth Circuit has not addressed

 

7 MP argues in an entirely conclusory manner that the Court can and should amend the MSJ Order to direct entry of judgment 

for CVIN and include a damages sum, the amount of which MP claims is undisputed. Doc. 391- at 11. MP provides no 

authority for this proposition, and the Court can find none, particularly given that CVIN has not asked for entry of judgment 

in its favor, nor has it discussed damages.

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the issue, numerous courts hold that a “controlling question of law” must present a “pure” or “abstract”

legal issue. See, e.g., Mamani v. Berzain, 825 F.3d 1304, 1312 (11th Cir. 2016); Rieve v. Coventry 

Health Care, Inc., 870 F. Supp. 2d 856, 879 (C.D. Cal. Apr. 25, 2012); Ahrenholz v. Bd. of Trustees of 

Univ. of Ill., 219 F.3d 674, 677 (7th Cir. 2000). Under that line of precedent, case- and fact-specific 

orders are not certifiable for a § 1292(b) interlocutory appeal. See, e.g., Mamani, 825 F.3d at 1312; 

Ahrenholz, 219 F.3d at 677.

MP frames the controlling question of law at issue in the MSJ Order as “whether the work [it] 

performed . . . falls within the scope of the C-7 license and whether, if it does not, the ‘supplemental and 

incidental’ exception saves MP[] from non-licensure.” Doc. 391-1 at 1. This mixed question of law and 

fact is not appropriate for interlocutory appeal because it does not present a controlling question of law. 

See People v. Kinder Morgan Energy Partners, LLP, No. 07cv1883-MMA (WVG), 2016 WL 1165828, 

at *2 (S.D. Cal. Mar. 24, 2016) (“A ‘question of law’ generally means a ‘pure’ question of law, not a 

mixed question of law and fact, or an application of law to a particular set of facts.” (citation omitted)).

Even if the Ninth Circuit disagreed with the Court’s reasoning and understanding of the applicable law, 

the Ninth Circuit would have to review the record to determine whether MP was duly licensed under the 

specific facts of this case. This is precisely the kind of highly factual, case-specific situation that is not 

properly certified under § 1292(b). See McFarlin v. Conseco Servs., LLC, 381 F.3d 1251, 1259 (11th 

Cir. 2004) (“The antithesis of a proper § 1292(b) appeal is one that turns on whether . . . the district 

court properly applied settled law to the facts or evidence of a particular case.”); see also Mamani, 825 

F.3d at 1313 (holding appeal that asked court to decide whether the specific facts alleged by plaintiffs 

stated claims was not properly certified under § 1292(b)). Accordingly, MP’s § 1292(b) motion is 

DENIED.

C. CVIN’s motion to bifurcate

Rule 42(b) provides that, “[f]or convenience, to avoid prejudice, or to expedite and economize, 

the court may order a separate trial of one or more separate issues [or] claims.” The Rule “confers broad 

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discretion upon the district court to bifurcate a trial, thereby deferring costly and possibly unnecessary 

proceedings pending resolution of potentially dispositive preliminary issues.” Zivkovic v. So. Cal. 

Edison Co., 302 F.3d 1080, 1088 (9th Cir. 2002).

CVIN argues—and MP does not and cannot dispute—that a bifurcated trial limited to the issue 

of whether MP’s Class A license was valid and sufficient to cover its work on the Project could 

potentially dispose of all of MP’s claims. CVIN argues that trying the Class A license issue, which must 

occur at some point, prior to reaching the merits of the case will increase convenience and judicial

economy.8 Because the Court found in the MSJ Order that MP’s C-7 license was insufficient, if a jury 

found that MP’s Class A license was invalid or insufficient, then MP is precluded under § 7031 from 

maintaining any of its claims. 

Bifurcating a trial in order to try a potentially dispositive issue like this is proper under Rule 

42(b). See Exxon Co. v. Sofec, Inc., 54 F.3d 570, 575 (9th Cir.1995); Danjaq LLC v. Sony Corp., 263 

F.3d 942, 961 (9th Cir. 2001) (observing that a court might bifurcate a trial to “avoid[] a difficult 

question by first dealing with an easier, dispositive issue”). As MP notes in its opposition, “‘[j]udicial 

economy through bifurcation may be achieved when an earlier trial deals with a dispositive matter 

which may moot the necessity of a later trial.’” Doc. 404 at 6 (quoting Ioane v. Spjute, No. 1:07-cv0620-AWI-EPG, 2016 WL 3916966, at *3 (E.D. Cal. 2016) (emphasis added)).

MP argues, however, that because the Class A license is not distinct and discrete from the merits, 

the evidence concerning both with substantially overlap. MP seems to suggest, though not explicitly, 

that because of this purported overlap, the licensure issue and the merits are not separable and therefore 

cannot be bifurcated. 

MP’s position is belied completely by the fact that MP moved for summary judgment on the 

 

8 Because Rule 42(b) is written in the disjunctive, CVIN satisfying any one of the grounds for bifurcation is sufficient. See

Boone v. City of Los Angeles, 522 Fed. App’x 402, 403 (9th Cir. 2013) (“Rule 42(b) authorizes district courts to bifurcate a 

trial for any one of the following reasons: (1) ‘convenience,’ (2) ‘to avoid prejudice,’ or (3) ‘to expedite and economize.’”). 

The Court therefore need not address all of the parties’ arguments.

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Class A licensure issue. At that stage of the litigation, MP certainly believed the issue could and should 

be resolved before reaching the merits of its claims. Regardless of MP’s motion for summary judgment, 

MP provides no meaningful explanation as to why the licensure issue is inseparable from the merits. 

Although MP claims the issues and corresponding evidence overlaps, MP does not meaningfully explain 

why any purported overlap should preclude bifurcation in this case. More to the point, MP does not 

point to any specific evidence that allegedly overlaps.

But, more importantly, even if MP could do so, that would not necessarily mean bifurcation 

would be inappropriate. Even assuming there is an overlap in the evidence on the license issue and the 

merits—which MP has failed to show entirely—bifurcation could potentially save a significant amount 

of resources for the parties, the jury, and the Court. The July 2017 trial is estimated to last approximately 

40 court days, whereas the licensure issue, which must be tried either way, is estimated to take between 

three days and a week. If a jury finds that MP’s Class A license was invalid or insufficient for MP’s 

work on the Project, then a potentially seven- or eight-week jury trial on an extraordinarily complex, 

multi-party matter will not be necessary.9If the jury does not so find, then the parties will know well in 

advance that they will have to prepare for a trial on the merits—preparation that ultimately would be 

unnecessary, but required nonetheless, if the trial were not bifurcated.

The Court acknowledges there is a risk that a trial on the Class A license issue would be an 

unnecessary waste of resources if the Ninth Circuit concludes that MP’s C-7 license was valid and 

sufficient to cover all of MP’s work on the Project. The Court, however, is unable to place that issue 

before the Ninth Circuit at this juncture. The Court also acknowledges that the Ninth Circuit could find 

one or both of MP’s licenses to be valid and sufficient, thus rendering a trial on the merits necessary. As 

it stands, however, the most efficient course is to try the Class A licensure issue so that if CVIN prevails, 

the threshold licensure issues can be resolved by the Ninth Circuit, as MP desires, and an extensive jury 

 

9 The Court cannot and does not consider the merits of the parties’ positions on whether CVIN is likely to succeed at trial.

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trial will potentially be avoided entirely.

10 If MP establishes its Class A license was valid and sufficient, 

then the Court will hold a trial on the merits as currently scheduled. This will permit the parties to spend 

the months they anticipate preparing for the merits of the trial knowing that it will not be a waste of time 

and resources due to a threshold jury finding that could have been decided well in advance.

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Accordingly, CVIN’s motion to bifurcate is GRANTED.

D. Discovery and scheduling issues

MP requests, and CVIN opposes, that the Court impose various conditions on the proceedings if 

CVIN’s motion to bifurcate is granted. See Doc. 404 at 10. Specifically, the parties dispute how 

discovery should proceed in light of bifurcation. The Court ORDERS the parties to meet and confer 

prior to any further Court involvement on discovery matters. If the parties cannot resolve their issues 

informally, the Court leaves discovery disputes to the Magistrate Judge’s discretion. But because the 

parties have expended an inordinate amount of the Magistrate Judge’s time and resources, the Court 

strongly urges the parties to resolve these discovery issues without the Court’s assistance.

Finally, the parties disagree about the estimated length to try the Class A licensure issue—CVIN 

estimates it will take three days; MP estimates it will take one week. The parties are ORDERED to meet 

and confer to determine an estimated length for the trial. CVIN requests the earliest the trial be set 

between December 2016 and April 2017; MP does not indicate any preference. The Court is unavailable 

in December, but is available from January 2, 2017, through January 23, 2017, excluding Mondays. The 

Court is also available between April 11-14, 2017. The parties are ORDERED to provide the Court with 

three agreed-on dates for the trial during these timeframes by October 16, 2016. 

 

10 CVIN states that, if it prevails, it will “agree to stay the remainder of its claims (following entry of judgment for 

disgorgement, interest and fee damages in CVIN’s favor arising from MP’s improper licensure) while MP proceeded with an 

appeal.” Doc. 397 at 8. The Court interprets this representation to mean that, if successful at the licensure trial, CVIN will 

agree to the entry of judgment on MP’s claims affected by the MSJ Order. In other words, CVIN will agree to resolve those 

claims so that MP can appeal the C-7 licensure issue. The Court expects that CVIN will honor this representation.

11 Any concerns MP may have about the C-7 licensure issue and the MSJ Order affecting the trial can be addressed in pretrial motions, if necessary.

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IV.CONCLUSION AND ORDER

For the foregoing reasons, the Court DENIES MP’s motion for judgment or alternatively for an 

interlocutory appeal (Doc. 391) and GRANTS CVIN’s motion to bifurcate (Doc. 396). The parties shall 

submit a joint status report with three agreed-on dates for a trial on the Class A licensure issue.

IT IS SO ORDERED.

Dated: October 4, 2016 /s/ Lawrence J. O’Neill _____ 

UNITED STATES CHIEF DISTRICT JUDGE

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