Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_15-cv-01852/USCOURTS-casd-3_15-cv-01852-2/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 

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15cv1852-LAB (BGS)

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

LEADING MANUFACTURING 

SOLUTIONS, LP,

Plaintiff,

v.

HITCO, LTD., et al.,

Defendant.

Case No.: 15cv1852-LAB (BGS)

ORDER ON MOTIONS IN 

LIMINE; AND

ORDER GRANTING IN PART 

MOTION FOR PRELIMINARY 

INJUNCTION

The Court held a hearing on the pending motions in limine (Docket nos. 132 

through 136) and the pending motion for preliminary injunction. (Docket no. 114.) 

For reasons discussed at the hearing, the Court rules as follows on those motions.

The motion to preclude evidence of concealment (Docket no. 132) is 

DENIED. Plaintiff clarified that evidence of concealed facts is merely a part of his 

fraud claim, and he is not bringing a separate claim for concealment.

The motion concerning choice of law (Docket no. 133) is GRANTED. 

Although the motion was opposed, the parties agree that California law governs 

Plaintiff’s substantive claims, and New York law governs the corporate status of 

the two Hitco entities. Because alter ego arises from the entities’ corporate status, 

it too is governed by New York law.

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15cv1852-LAB (BGS)

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The motion for leave to amend the answer to include a statute of frauds 

defense (Docket no. 134) is GRANTED and the answer is DEEMED AMENDED

to include this defense. The parties may submit additional briefing on this issue 

no later than noon on Monday, August 13, as discussed at the conference. But 

they should bear in mind that the Court may not address the issue until after trial 

has begun. And they should make every effort to be as succinct as possible.

The motion to exclude time-barred evidence (Docket no. 135) is GRANTED 

IN PART. Plaintiff’s counsel may not argue that Defendants are liable for claims 

barred by the statute of limitations. But evidence concerning Defendants’ actions 

outside the limitations period is not excluded merely because a claim arising during 

that time period would be. Counsel should confer and prepare a jury instruction on 

the statute of limitations defense.

The motion to bifurcate punitive damages and for the alter ego issue to be 

decided by the Court is GRANTED IN PART. Evidence on punitive damages is to

be presented only after the first verdict (assuming the verdict is consistent with 

such an award). Counsel will reserve a portion of their time for presentation of 

evidence and argument; they will not be given additional time. Defendant Smith 

should be prepared to testify about his net worth, and should bring records of his 

net worth with him to trial.

On the alter ego, the jury will be asked to return a special verdict. The parties 

shall prepare questions of fact for the jury based on the alter ego factors that apply 

here. The Court will base its alter ego determination on the jury’s findings of fact. 

If the facts are sufficient, the Court will determine whether equity requires that the 

doctrine apply. See United States S.E.C. v. Jensen, 835 F.3d 1100, 1111 (9th Cir. 

2016) (holding that the trial court should consider equitable relief only after the 

legal claims had been tried to a jury, and that after the verdict, the court is bound 

by the jury’s factual determination).

/ / /

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The motion for a preliminary injunction is GRANTED IN PART. Until this 

case’s final disposition, Defendant Smith is ORDERED to retain full possession 

and control of the patents for the Smart Clamp and Sani-Lock, and not to sell, 

pledge, or otherwise transfer them.

Counsel should prepare for a jury instruction conference on Wednesday, 

August 15 at noon.

IT IS SO ORDERED.

Dated: August 10, 2018

Hon. Larry Alan Burns

United States District Judge

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