Filed 8/1/23 St. Monica Development v. Gabrielino-Tongva Tribe CA2/5

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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has not been certified for publication or ordered published for purposes of rule 8.1115.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

SECOND APPELLATE DISTRICT

DIVISION FIVE

ST. MONICA DEVELOPMENT,

Plaintiff and Appellant,

v.

GABRIELINO-TONGVA TRIBE et al.,

Defendants and Respondents.

B302377 c/w B308161

(Los Angeles County

Super. Ct.

No. SC091644)

THE CRANE GROUP, INC.,

Plaintiff and Appellant,

v.

GABRIELINO-TONGVA TRIBE et al.,

Defendants and Respondents.

(Los Angeles County

Super. Ct.

No. SC092615)

ORDER MODIFYING

 OPINION

[NO CHANGE IN 

JUDGMENT]
2

GABRIELINO-TONGVA TRIBE,

Plaintiff and Respondent,

v.

ST. MONICA DEVELOPMENT et al.,

Defendants and Appellants;

ST. MONICA DEVELOPMENT,

Cross-complainant and Appellant,

v.

GABRIELINO-TONGVA TRIBE et al.,

Cross-defendants and 

Respondents.

(Los Angeles County

Super. Ct.

No. BC361307)

BY THE COURT:

It is ordered that the opinion filed herein on July 7, 2023, is 

modified as follows: 

On page 73, subsection B, line 5 in the first full paragraph, 

delete “and the punitive damages eliminated” from the sentence.

There is no change in judgment.

____________________________________________________________

MOOR, J. RUBIN, P.J. KIM, J.
Filed 7/7/23 St. Monica Development v. Gabrielino-Tongva Tribe CA2/5 (unmodified 

opinion)

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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has not been certified for publication or ordered published for purposes of rule 8.1115.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

SECOND APPELLATE DISTRICT

DIVISION FIVE

ST. MONICA DEVELOPMENT,

Plaintiff and Appellant,

v.

GABRIELINO-TONGVA TRIBE et al.,

Defendants and Respondents.

B302377 c/w B308161

(Los Angeles County

Super. Ct.

No. SC091644)

THE CRANE GROUP, INC.,

Plaintiff and Appellant,

v.

GABRIELINO-TONGVA TRIBE et al.,

Defendants and Respondents.

(Los Angeles County

Super. Ct.

No. SC092615)
2

GABRIELINO-TONGVA TRIBE,

Plaintiff and Respondent,

v.

ST. MONICA DEVELOPMENT et al.,

Defendants and Appellants;

ST. MONICA DEVELOPMENT,

Cross-complainant and 

Appellant,

v.

GABRIELINO-TONGVA TRIBE et al.,

Cross-defendants and 

Respondents.

(Los Angeles County

Super. Ct.

No. BC361307)

APPEALS from a judgment and order of the Superior Court 

of Los Angeles County, Yvette M. Palazuelos, Judge. Affirmed as 

modified.

Freeman Mathis & Gary, John K. Rubiner; California 

Appellate Law Group, Rex S. Heinke; Law Offices of Jonathan 

Stein and Jonathan Stein, in pro. per., for Defendant and 

Appellant Jonathan Stein and Defendant, Cross-complainant and 

Appellant St. Monica Development Company.

The Tym Firm, Ronald D. Tym; Law Offices of Jonathan 

Stein and Jonathan Stein, in pro. per., for Defendants and 
3

Appellants Jonathan Stein and St. Monica Development 

Company, and The Crane Group, Inc.

Law Offices of Jonathan Stein and Jonathan Stein for 

Plaintiff and Appellant The Crane Group, Inc.

Chora Young & Manasserian, Paul P. Young, Joseph Chora 

and Armen Manasserian for Plaintiff, Cross-defendant and 

Respondent Gabrielino-Tongva Tribe.

——————————

A three-phase trial was held on three consolidated cases 

arising out of contracts to develop casino gaming for the 

Gabrielino-Tongva Tribe (the Tribe). Appellants Jonathan Stein 

and St. Monica Development Company, LLC (SMDC), appeal 

from the judgment after trial in favor of the respondent Tribe and 

individual defendants: lobbyist Richard Polanco, attorney 

Elizabeth Aronson, and Tribal Council members Sam Dunlap, 

Virginia Carmelo, Martin Alcala, Edgar Perez, Shirley Machado, 

and Adam Loya.

1 On appeal, Stein and SMDC contend: (1) the 

trial court’s statement of decision is not entitled to deference, 

because the court did not make any of the changes suggested by 

Stein and SMDC; (2) the trial court’s findings are not supported 

by the evidence, including findings of an attorney-client 

relationship between Stein and the Tribe, a right to rescission of 

the contract between SMDC and the Tribe based on Stein’s 

violation of the California Rules of Professional Conduct,2 fraud, 

intentional interference with contract, tortious interference with 

1 None of the individual defendants have filed a 

respondent’s brief on appeal.

2 All further references are to the California Rules of 

Professional Conduct, unless otherwise stated.
4

prospective economic advantage, conversion, breach of the 

covenant of good faith and fair dealing, attorney malpractice, and 

breach of fiduciary duty; (3) the compensatory damages awarded 

were too speculative and incorrectly calculated; (4) the punitive 

damages awarded were not supported by evidence of Stein’s net 

worth; and (5) the trial court erred by finding Stein and SMDC 

dismissed their claims against the Tribe prior to trial, and by 

failing to adjudicate claims in their cross-complaint against the 

individual defendants. 

We conclude the statement of decision is entitled to the 

usual consideration on appeal. The trial court’s finding that an 

implied attorney-client relationship existed between Stein and 

the Tribe, which allowed for rescission of the agreement based on

Stein’s violation of professional rules, is supported by substantial 

evidence, as are the court’s findings of fraud and conversion. 

Because we conclude the findings as to rescission, fraud, and 

conversion support the remedies provided in the judgment, we 

need not address whether these remedies were additionally 

supported by the remaining causes of action. The compensatory 

damages awarded were not overly speculative, but the calculation 

was incorrect. The amount must be reduced from $20,411,067.23 

to $19,161,067.23, which was the maximum amount supported by 

the evidence. The trial court concluded that Stein was estopped 

from objecting to punitive damages based on a lack of evidence of 

his net worth because he failed to provide credible evidence of his 

net worth in discovery, and no error has been shown. The trial 

court’s finding that Stein and SMDC dismissed their claims 

against the Tribe was supported by substantial evidence, and 

moreover, despite the dismissals, Stein and SMDC were 
5

permitted to try their claims against the Tribe and the individual 

defendants in full.

Appellant The Crane Group appeals from the portion of the 

judgment ruling on Crane’s action in favor of the respondent 

Tribe, and the individual defendants, Polanco, Aronson, Dunlap, 

Carmelo, Alcala, Perez, Machado, and Loya. On appeal, Crane 

contends: (1) it did not dismiss its claims against the Tribe; (2) 

the trial court’s finding that Crane’s right to payment was 

triggered by the threshold amount received by the Tribe, rather 

than the total amount paid by investors, was not supported by 

the language of the parties’ agreement or the evidence; and (3) 

the trial court erred by finding Crane failed to provide evidence to 

support its claims for quantum meruit or account stated. We 

conclude that the trial court’s finding that Crane dismissed its 

claims against the Tribe is supported by substantial evidence. 

We modify the judgment by reducing the amount of 

compensatory damages from $20,411,067.23 to $19,161,067.23, 

and as modified, we affirm.

In a separate appeal from a postjudgment order awarding 

attorney fees, which was consolidated for the purposes of appeal, 

Stein, SMDC, and Crane contend that: (1) the award of attorney 

fees must be reversed if the judgment is reversed on the merits; 

(2) the Tribe is judicially estopped from asserting that the 

appellants dismissed their claims against the Tribe, because the 

Tribe successfully argued it had not entered into a settlement; 

and (3) Stein is not liable for attorney fees assessed against 

SMDC by contract or as an alter ego of SMDC. We conclude that 

the reduction in the amount of compensatory damages did not 

alter the trial court’s finding that the Tribe was the prevailing 

party. In addition, Stein, SMDC, and Crane failed to raise any 
6

issue as to judicial estoppel or alter ego in connection with their 

appeal from the judgment, and these issues may not be addressed 

for the first time on appeal from the postjudgment order 

awarding attorney fees. Therefore, we affirm the postjudgment 

order awarding attorney fees.

FACTUAL AND PROCEDURAL BACKGROUND

History and Initial Contact with Stein

The indigenous Tongva people of the Los Angeles Basin 

became known as “Gabrielinos” based on their association with 

the San Gabriel Mission. (Gabrielino-Tongva Tribe v. St. Monica 

Development (Nov. 8, 2013, B238603) [nonpub. opn.].) In 1994, 

the State of California recognized the Gabrielinos as “the 

aboriginal tribe of the Los Angeles Basin.” (Ibid.) There are 

several associations of the descendants of the tribe in California. 

(Ibid.)

In early 2000, Stein approached Tongva descendent Sam 

Dunlap about obtaining federal recognition to facilitate a casino 

gaming operation in Los Angeles. Stein represented himself as a 

sophisticated transactional lawyer experienced in tribal gaming 

and financing. Stein and Dunlap courted a Gabrielino faction led 

by Jim Velasquez (the Coastal faction). The Coastal faction is the 

predecessor to the Tribe.

In May 2000, Stein’s secretary mistakenly sent an invoice 

to Dunlap, and Stein sent a retraction letter explaining that he 

would keep a record of his time to establish the legal costs for the 

transaction, but no payment was due yet. Specifically, he stated, 

“Payment on Stein Structure Financings is often made in whole 
7

or part from proceeds of the financing. Until that happens, I 

keep internal records of my time, to be fair and accurate in 

setting the legal costs for each separate financing transaction. If 

the transaction fails to go through, this time is often written off.”

Stein formed SMDC, of which he is the sole member, to 

develop casino gaming with the Tribe. With the assistance of his 

personal counsel, Stein drafted an agreement between “the 

Gabrielino-Tongva Nation,” which was also referred to in the 

agreement as “the Tongva” or “the Tribe,” and SMDC (the SMDC 

agreement). SMDC agreed to assist the Tribe to achieve federal 

recognition and develop a casino in Los Angeles County. The 

SMDC agreement guaranteed compensation of $25,000 per 

month to SMDC, which would be deferred until funds were 

available, as well as 10 percent of the “net win” from certain 

casino earnings and a significant ownership interest in any 

future casino gaming by the Tribe. The SMDC agreement also 

contained an attorney fees provision. The SMDC agreement 

expressly provided that Stein was not the Tribe’s attorney, and 

no attorney-client relationship was created between them. 

Stein falsely represented to the Tribe that attorney 

Stephen Otto was acting as their lawyer. Stein prepared a tribal 

resolution appointing Otto as counsel for the Tribe, although Otto 

explicitly declined to accept the position orally and in writing. 

Otto sent a letter to the Tribe explaining that he had declined 

involvement, because Stein failed to share Otto’s prior 

communications.

In March 2001, Stein presented the SMDC agreement to 

the Tribe without any other attorney present. Tribal Council 

members were not given time to read the document, take it home, 

or have a meaningful opportunity for a lawyer to review it. They 
8

were told that they would be removed from the Tribal Council if 

they did not sign the agreement. The Tribe adopted the SMDC 

agreement through a resolution drafted by Stein and signed by 

several Tribal Council members on behalf of the “GabrielinoTongva Tribe,” including Dunlap and Velasquez. The Tribal 

Council members signed the document under duress, without the 

benefit of counsel and without understanding the SMDC 

agreement. 

The following month, a resolution concerning the SMDC 

agreement was signed by a substantially different group of Tribal 

Council members: Dunlap, Martin Alcala, Shirley Machado, 

Virginia Carmelo, and Edgar Perez. The Tribe approved 

amendments to the SMDC agreement through a series of 

resolutions on behalf of the “Gabrielino-Tongva Tribe” between 

April 2001 and May 2006.

Although the SMDC agreement disclaimed an attorneyclient relationship, Stein provided an array of legal services to 

the Tribe and acted as the Tribe’s general counsel. In addition to 

the resolution that adopted the SMDC agreement, Stein drafted 

several other resolutions for the Tribe. He hired attorneys to act 

as counsel of record for the Tribe, but directed their work. Stein 

hired, supervised, and fired all of the outside counsel for the 

Tribe.

The Gabrielino Tribal Gaming Authority was an entity 

formed within the Tribe to be responsible for the casino project. 

Stein held himself out as the Tribal Development Officer of the 

Tribe and the Chief Executive Officer of the Gaming Authority.

All of the Tribe’s books and records were kept at Stein’s law 

offices, which is where SMDC was also located.
9

A few months after the SMDC agreement was signed, Stein 

hired attorney Rae Lamothe to serve as the Tribe’s General 

Counsel. In 2002, Stein advised some of the Tribal Council 

members to file an action against a different group of Tongva 

descendants (the Morales Group) to gain access to membership 

information and historical documents that the Morales group had 

gathered. Stein filed the lawsuit on behalf of Dunlap, while 

Lamothe represented Alcala, Carmelo, and Perez. When it 

became clear that the plaintiffs would lose the lawsuit, Stein 

withdrew. The individuals lost and incurred expensive litigation 

costs. Although he had withdrawn as counsel of record, Stein 

insisted on conducting settlement negotiations personally.

Dunlap filed for personal bankruptcy as a result of the judgment.

In an email to Lamothe, Stein explained that Dunlap’s 

bankruptcy counsel would serve as attorney of record for the 

bankruptcy, but Stein would supervise Lamothe in representing 

the Tribe’s interest in Dunlap’s bankruptcy.

Stein provided the Tribal Council with a lengthy legal 

memorandum arguing that the Tribe was a state-recognized 

tribe, and state-recognized tribes did not need federal recognition 

to conduct legal gaming operations on a state Indian reservation 

in California, only state approval of the gaming. Stein circulated 

versions of the memorandum to political leaders. Under Stein’s 

theory, the SMDC agreement would avoid review by the National 

Indian Gaming Commission (NIGC), which invalidates 

agreements that provide a significant ownership interest to nonNative Americans in tribal gaming by federally recognized tribes.

Stein hired former state legislator Richard Polanco as a

political advisor and lobbyist for the Tribe. Stein also hired The 

Crane Group to lobby for the Tribe in Washington, D.C. In 
10

March 2005, Crane entered into a written consulting agreement 

with the “Gabrielino-Tongva Tribal Nation,” in which Crane 

agreed to lobby for the Tribe to obtain federal recognition (the 

Crane agreement). The Tribe agreed to pay $12,500 per month to 

Crane, but the amount would accrue until the Tribe received 

payment of at least $2 million in investment funding. Once an 

investor had been secured and $2 million paid, the Tribe would 

be required to pay Crane all of the monthly fees that had accrued. 

The Crane agreement also contained an attorney fees provision.

A resolution approving the Crane agreement was executed on 

March 26, 2005, by Dunlap, Alcala, Machado, Carmelo, and 

Perez.

In October 2005, the Tribe held its first election for the 

Tribal Council, electing Dunlap, Alcala, Machado, Carmelo, 

Perez, and Adam Loya (the Tribal Council). Stein published a

law review article in the University of San Francisco Law Review 

about the gaming rights of Indian tribes that had state 

recognition but not federal recognition. 

In April 2006, former California Supreme Court Justice 

Cruz Reynoso wrote a letter to the California Legislative Counsel 

stating that he had been retained by the Tribe to perform a legal 

analysis of the Tribe’s gaming rights. The California 

Constitution stated that the Governor could negotiate compacts 

for certain gaming activities by “federally recognized Indian 

tribes on Indian lands in California in accordance with federal 

law,” and in the next sentence concluded, accordingly, those 

gaming activities were permitted on “tribal lands subject to those 

compacts.” In Reynoso’s opinion, the provision was ambiguous 

because it referred to Indian lands in the first sentence and tribal 

lands in the second sentence. Reynoso argued the ambiguity 
11

should be interpreted to allow gaming activities by all California 

Indian tribes, including tribes that were state recognized but not 

federally recognized.

Former California Supreme Court Justice Armand Arabian 

also provided a letter to the California Legislative Counsel 

opining that the California Constitution contained an ambiguity 

because of the use of “Indian lands” and “tribal lands.” He opined 

that proposed draft legislation was within the power of the 

Legislature to enact.

In the spring of 2006, attorney Lamothe stopped working 

with the Tribe and attorney Liz Aronson became the Tribe’s 

Assistant General Counsel. 

The Libra Investment

On May 20, 2006, Libra Securities, LLC, a Los Angeles 

investment fund managing several institutional investors, 

entered into an agreement with “the Gabrielino-Tongva Tribe, a 

tribal sovereign for the Gabrielino aboriginal tribe of Los Angeles 

Basin, formerly known as the San Gabriel Bank of Mission 

Indians and now recognized by Legislative Resolution Chapter 

146 of the California Code” (the Libra agreement). Stein hired an 

experienced tax and corporate lawyer to assist the Tribe with the 

financing transaction, directed her work, and fired her days 

before the Libra agreement was scheduled to close. Stein 

handled the closing on behalf of the Tribe.

The Libra agreement stated that the Tribe wanted to 

establish Las Vegas-style casinos in Los Angeles County to 

conduct gambling activities. Libra agreed to invest funds in 

exchange for an interest in the revenue. Libra agreed to make a 
12

one-time payment to the Tribe of $900,000 and an initial 

investment of $1,250,000. In addition, Libra committed for a oneyear period, subject to extension, to invest an additional 

$19,000,000, subject to satisfaction or waiver of certain 

conditions. For an additional payment of $900,000, Libra could 

extend the time period of the commitment for an additional year.

There were four conditions precedent to further funding.

The first condition was that “[Senate Bill No.] 175 or 

substantially similar legislation[ ] has been passed into law (i.e., 

by virtue of being signed into law by the Governor of the State of 

California or otherwise).” The exhibits attached to the agreement 

included a document appearing to be Senate Bill No. 175 (Senate 

Bill 175), introduced by Senator Edward Vincent, as amended in 

the Assembly and the Senate. Among other provisions, the 

document proposed to create a state Indian reservation at 

Hollywood Park in Inglewood for the Gabrielino-Tongva Tribe, 

and interpreted existing language in the California Constitution 

to allow gaming on tribal lands, such as the Gabrielino-Tongva 

reservation at Hollywood Park.

The remaining conditions were that (1) no material change 

had occurred, (2) the Tribe was, and continued to be, recognized 

by the State of California as an Indian tribe, and (3) if required 

by Senate Bill 175 or any other legal requirement, the Libra 

agreement was approved by the Bureau of Indian Affairs under 

the Department of the Interior of the United States. The Tribe 

and the Gaming Authority must deliver a certificate attesting 

that each of the conditions precedent to funding had been 

satisfied in all material respects.

The Tribe represented that the only known groups of 

persons claiming to be the legitimate governing body of the 
13

Gabrielinos were: (1) the San Gabriel faction led by Anthony 

Morales, (2) a Beaumont group led by the Blount family, (3) a 

West Los Angeles group led by Robert Dorame, and (4) the 

Coastal faction led by Velasquez.

The Tribal Council members believed the document 

attached to the Libra agreement as exhibit B was an actual bill 

drafted by a member of the State Senate or his staff. The Tribal 

Council members were not aware that the document was a crude 

draft prepared by Stein that was never introduced in the 

Legislature.

In May 2006, the Tribe adopted a resolution to amend the 

SMDC agreement that was signed by the Tribal Council. On 

May 22, 2006, the Tribe received its portion of the first tranche of 

investment funding from Libra. Certain expenses provided for in 

the Libra agreement were deducted prior to funding, so the total 

amount received by the Tribe was $1,805,889, which the Tribe 

was required to spend in accordance with an approved budget. 

Legislative Counsel Opinion

The same day that the Tribe received funds, the California 

Legislative Counsel issued an opinion to Senator Vincent that the 

Tribe was not a state recognized tribe, and even if it were, a state 

recognized tribe could not engage in gaming without federal 

recognition. The opinion stated in a footnote, “the state of 

California may recognize a tribe that is not federally recognized, 

but it has not done so.” The opinion expressly concluded, “the 

Legislature has no power to authorize a non-federally recognized 

Indian tribe to operate slot machines, lottery games, and banking 
14

and percentage card games in California, even if the state gives 

the tribe the designation of a state-recognized tribe.” 

Stein learned about the Legislative Counsel’s opinion the 

following day. Although he believed it was material to the Libra 

agreement, he did not transmit the opinion to Libra for several 

months. 

Disputes Begin in Summer 2006

On July 15, 2006, Stein wrote an email to Aronson and the 

elected Tribal Council members about Dunlap’s request for 

reimbursement of $18,000. Stein argued that the approved 

budget for the first tranche of investor funds did not allow 

payment to Dunlap, so a payment to Dunlap could cause the 

investors to look unfavorably on the investment. He added, “We 

recently suffered a huge defeat in Sacramento. On August 9, our 

next report to investors is due. It may include facts that will sour 

them on this investment, as we previously assured them that 

[Senate Bill No.] 175 was authored by Senator Vincent and would 

be introduced publicly, a major step towards the casino. In the 

August 9 report, we are likely going to state that Sen. Vincent 

refused to author [Senate Bill No.] 175 and that it will not be 

publicly introduced this legislative session.”

Disputes arose between the Tribal Counsel, Stein, and 

Aronson throughout the summer of 2006. Aronson accused Stein 

of billing and double-billing legal costs from his law practice to 

the Tribe’s Libra funds and unreasonably delaying finalization of 

a settlement with the Morales group. Stein asked Aronson to 

resign, and on behalf of the Tribe, drafted a termination letter 

and resolution terminating her.
15

At a meeting on September 9, 2006, at Stein’s office, Stein 

demanded that the Tribal Council fire Aronson, and when they 

refused, he said that he quit. The Tribal Council carried the 

documents that they could out of Stein’s law office, but many 

documents were left behind, including individual tribal member 

records and financial records. Stein delivered a letter to the 

Tribal Council resigning his positions in the tribal 

administration. Stein later told the Tribal Council that he had 

frozen the Tribe’s funds for two weeks and would return the 

funds to the Libra investors. 

The Tribe met with Libra. Libra assured the Tribe that 

their actions were acceptable as long as they abided by the 

contract.

Stein wanted the Tribal Council to replace Aronson with 

attorney Jim McShane with the law firm of Sheppard Mullen 

Richter and Hampton, LLP. On September 19, 2006, Stein 

introduced McShane to the Tribal Council. The Tribe ultimately 

hired McShane without referring to Stein in their retainer 

agreement.

On September 26, 2006, Stein wrote an email to the Tribal 

Council setting a deadline the following day for several matters.

He advocated to be the sole signatory on certain financial 

accounts, but cautioned against having an individual Tribal 

Council member as a sole signatory without insurance. After 

explaining several actions to be taken, Stein stated, “If we miss 

the deadline, then I will be forced to send a letter to Libra which I 

will draft today, explaining the damage and other factors which 

your meeting with [Libra] may have glossed over. I earnestly 

wish to avoid any letters as our dirty laundry should stay at 

home. I also do not wish to endanger the $2.5 million funding 
16

that hangs in the balance.” He signed the email as Chief 

Executive Officer of the Gabrielino Tribal Gaming Authority.

On September 27, 2006, Stein wrote an email stating that 

representatives for Libra had drafted and revised a memorandum 

requesting $2.5 million for the Tribe. Stein was waiting for the 

final copies from Libra. 

On September 29, 2006, Stein wrote an email to the Tribal 

Council and Libra stating that the effort to establish the 

Gabrielino Casino and Resort was officially dead in the water.

He had not been paid $120,000 that was past due, and there had 

been no commitment for payment of future contributions. 

Instead, the Tribal Council had paid itself, and records showed 

$20,000 might be missing from the account. More than $100,000 

in additional funds were in the sole and exclusive control of a 

non-tribal third party with no business relationship to the Tribe 

or the Tribal Gaming Authority. Of the political checks that had 

been written, two checks were correct, three checks were in the 

wrong amounts, two checks might be duplicates, all of the 

payments were late, and Stein had not been paid.

Later that day, the Tribal Council wrote a letter to Stein 

directing him to “immediately suspend all of [his] activities and 

those of [SMDC] on behalf of the Tribe and the Tribal Gaming 

Authority.” 

The next day, Stein sent an email to the Tribal Council 

acknowledging receipt of the Tribe’s termination letter. He 

suggested working together until December 15, at which time he 

would step aside. He wanted the Tribe to commit to pay 

$500,000 in political contributions, as well as payments to 

himself for several items. He added, “Also, per my contract, if I 

leave Dec 15 (by your choice or mine, with or without cause), here 
17

is what happens: [¶] $2 million is immediately due SMDC from 

the Tribe and, hopefully, Libra could finance that. [¶] My 10

[percent] slot revenue interest remains intact. I need an estoppel 

certificate to assure that. [¶] The only difference is, instead of 

working 7 days a week and waiting for my money, I don’t work 

and I get far more money immediately. You pay me and the new 

CEO, instead of just me. [¶] I will probably spend 2007 on 

sabbatical in Rome and Europe, unless I were paid to stay and 

consult with your new team. Thus there would be no need to 

worry about me ‘bad mouthing’ the Tribe in Sacramento after I 

left on good terms.”

At a Tribal Council meeting on October 3, 2006, McShane, 

as outside counsel for the Tribe, told Stein that the Tribe had 

accepted his letter of resignation, and to the extent that Stein 

claimed not to have resigned, the Tribe was terminating him.

Demand Letters and Contact with Tribe Members

On October 5, 2006, attorney Geoffrey Long, on behalf of 

Stein and SMDC, wrote a letter to the Tribal Council and 

McShane, demanding payment of $2,464,535.96, plus additional 

amounts.

The Tribe’s membership records were highly confidential 

documents, which individually belonged to the members, but 

collectively belonged to the Tribe. Stein retained possession of: 

the confidential individual tribal membership records, 

membership lists, and contact information for the members; 

tribal letterhead, website, cell phones, and computers; and all the 

government filings that Stein had caused to be filed on the 

Tribe’s behalf. 
18

In October 2006, Stein used the Tribe’s confidential 

membership list without the Tribal Council’s consent to contact

the membership directly. He sent a letter to each member of the 

Tribe on Tribal Council letterhead that listed Alcala, Carmelo, 

Dunlap, Loya, Machado, and Perez as the Tribal Council 

members. Stein stated that the Tribal Administration Office was 

designed to act as a “check and balance” on the Tribal Council 

and supervise the use of investor funds. Stein had raised $21 

million for the Tribe in May 2006, but the Tribal Council refused 

to authorize a letter announcing the funding agreement to the 

membership. He added, “This letter is sent without their 

authorization.” Stein stated that for the past five years, he paid 

the expenses of the Tribe and made all of the decisions on the 

casino project, subject to final approval by the Tribal Council.

He stated, “My assistant, Barbara Garcia, is the Tribal 

Administrator. Barbara answers the Tribal Administration 

Office phone and keeps membership records. With the excellent 

work of the Tribal Council, we built up tribal membership to over 

1900 Gabrielinos. Your membership records are secure, private 

and computerized. Each of you has your own manila folder for 

BIA and personal documents.”

Stein claimed to have been fired because of his repeated 

requests to verify the amounts held in the Tribe’s checking 

account and to complete a routine financial audit. The 

signatories on the Tribe’s accounts were changed without his 

knowledge. Check books and bank records had been removed 

from the Tribal Administration Office.

Stein touted his organizational achievements, including 

nonpartisan Tribal Council elections in the fall of 2005. He 

stated, “I worked this summer with Assemblyman Tom Umberg 
19

(D-Garden Grove), who introduced [Assembly Bill No.] 1561. 

[Assembly Bill No.] 1561 would establish a California State 

Indian Reservation at Hollywood Park, allow the Tribe to conduct 

gaming there without federal recognition, and establish a casino 

with 7500 slot machines (subject to negotiation of a tribal 

compact). [¶] The first page of the bill summary for [Assembly 

Bill No.] 1561 is enclosed.” 

In conclusion, Stein pleaded, “Despite my hard and diligent 

work, I have been fired by the Tribal Council, for arguing for a 

‘check and balance’ on their authority. [¶] I organized elections 

in October 2005, raised $21 million in May 2006, introduced 

gaming legislation in August 2006, conducted the first 

independent financial audit in September 2006, and was fired on 

October 3, 2006. Is that good for the Tribe? [¶] I ask your help. 

If you support an independent Tribal Administration Office that 

can operate as a ‘check and balance’ on the Tribal Council, please 

sign and return the letter enclosed. [¶] If you support the Tribal 

Administration Office’s work on the casino project, which I 

designed, funded, hired all the professionals, and now supervise, 

then please sign and return the letter. [¶] Although your 

response to this letter does not bind the Tribal Council, it will let 

them know what the Tribal Members think and want. Thank 

you and feel free to call Barbara with any questions.” 

Stein terminated the Tribal Council members’ cell phone, 

email, and website access. When individual Tribal Council

members requested the return of records to the Tribe, Stein’s 

office refused. 

On October 23, 2006, attorney Long sent another demand 

letter enclosing a complaint that SMDC intended to file if the 
20

Tribe refused to engage in settlement negotiations. Long sent a 

final demand letter on November 2, 2006.

Libra provided a letter of support for the Tribe stating that 

nothing was wrong with the actions taken with respect to the 

contract, and the Tribal Council distributed copies to its 

membership. 

Litigation Filed and Stein’s Attempt to Usurp Control of 

the Tribe

A. The Tribe’s Complaint

On November 2, 2006, the Tribe filed the instant action 

against Stein, the Law Offices of Jonathan Stein, and SMDC 

(case number BC361307). The Tribe’s operative fourth amended 

complaint alleged causes of action for: (1) conversion; (2) breach 

of fiduciary duty; (3) misappropriation of trade secrets; (4) breach 

of confidence; (5) intentional interference with economic 

relationships; (6) negligent interference with economic 

relationships; (7) breach of contract (SMDC only); (8) breach of 

the implied covenant of good faith and fair dealing (SMDC only); 

(9) legal malpractice (Stein and Law Offices only); (10) 

declaratory relief; (11) violation of Penal Code section 502, 

subdivision (c); (12) unfair competition; (13) rescission per 

California Rules of Professional Conduct, Rule 3-300 (Stein and 

Law Offices); (14) alter ego liability; and (15) fraud. 
21

B. SMDC Complaint

That same day, on November 2, 2006, SMDC filed a

complaint against “Gabrielino-Tongva Tribe,” Gabrielino Tribal 

Gaming Authority, Libra, attorney Aronson, lobbyist Polanco, the 

law firm Sheppard Mullen, and each of the Tribal Council 

members (case No. SC091644). In May 2007, SMDC filed an 

amended complaint against “Gabrielino/Tongva Nation, also 

known as Gabrielino-Tongva Tribe, also known as Gabrielino 

Tribal Gaming Authority,” Libra, Aronson, Sheppard Mullen, 

Polanco, and each of the Tribal Council members. 

Dunlap later filed a cross-complaint in SMDC’s action

against Stein, the Law Offices, SMDC, and individual 

defendants. 

C. Effort to Take Control of the Tribe

Stein sent a letter to the membership of the Tribe 

anticipating a meeting on November 18, 2006, to introduce a 

newly formed “Financial Oversight Committee” and his intent to 

call for a recall election of the Tribal Council. No recall election 

was held.

On December 17, 2006, at Stein’s direction, a member of 

the Tribe named Linda Candelaria filed a statement of

unincorporated association under the name “Gabrielino-Tongva 

Tribe.” The agent for service of process was Stein’s legal 

assistant, and the entity’s business address was Stein’s law office. 
22

D. Crane Complaint

In January 2007, Crane terminated its agreement with the 

Tribe. On January 31, 2007, Stein filed a complaint on behalf of 

The Crane Group against “Gabrielino-Tongva Tribe,” Gabrielino 

Tribal Gaming Authority, Aronson, Polanco, and each of the 

Tribal Council members (case No. SC092615). The Crane Group 

complaint alleged causes of action for breach of contract, 

intentional and negligent interference with contractual relations, 

fraudulent conveyance, negligence, account stated, quantum 

meruit, and declaratory relief. The actions brought by the Tribe, 

SMDC, and Crane were eventually found to be related and 

consolidated. 

E. Actions on Behalf of the Tribe

In February 2007, the Tribal Council members held a 

convention to ratify the constitution of the “Gabrielino/Tongva 

Nation.” Meanwhile, a group that included Candelaria (the 

Candelaria Group) held elections in the spring of 2007 on behalf 

of the “Gabrielino-Tongva Tribe.” 

In March 2007, Stein and the Candelaria Group entered 

into an agreement under which the Candelaria Group agreed 

that the Tribe was estopped from denying an obligation to pay 

$2,700,897.65 under the SMDC agreement. 

F. Stein and SMDC Cross-complaint

On August 20, 2007, Stein and SMDC filed a crosscomplaint in the Tribe’s action against “Gabrielino/Tongva 
23

Nation, also known as Gabrielino-Tongva Tribe, also known as 

Gabrielino Tribal Gaming Authority,” Aronson, Polanco, and each 

of the individual Tribal Council members. The cross-complaint 

alleged several causes of action, including breach of contract, 

fraudulent conveyance, indemnity, apportionment, contribution, 

and declaratory relief. No proof of service of the summons and 

cross-complaint were filed as to any cross-defendant. 

On September 26, 2007, Stein and SMDC filed another 

cross-complaint in the Tribe’s action against “Gabrielino/Tongva 

Nation, formerly known as Gabrielino-Tongva Tribe, formerly

known as Gabrielino Tribal Gaming Authority,” Aronson, 

Polanco, and each of the individual Tribal Council members. The 

cross-complaint alleged causes of action for indemnity, 

apportionment, contribution, and declaratory relief only. Proof of 

service was attached.

In 2008, Stein published a law review article in the Santa 

Clara Law Review, providing a survey of state-recognized tribes 

and state recognition processes across the United State. 

Settlements, Doe Defendants, and Dismissals

A. Purported Settlement of the Tribe’s Claims

On September 28, 2007, SMDC filed an amendment to its 

complaint naming “Gabrielino/Tongva Nation” in place of Doe 

defendant 1. 

On October 30, 2007, Stein and SMDC entered into a 

settlement in which the Candelaria Group agreed to settle the 

Tribe’s claims against Stein and SMDC for $1,000. Candelaria 

signed the agreement on behalf of the “Gabrielino-Tongva Tribe,” 
24

and represented that her group had the authority to settle the 

Tribe’s claims. 

Stein and SMDC filed a motion for entry of judgment 

pursuant to the settlement agreement, as provided under Code of 

Civil Procedure section 664.6. On April 1, 2008, the trial court 

granted the motion to enforce the settlement agreement as to the 

settling entity. The court noted there was little evidence in the 

record before the court of continuity between the various 

unincorporated associations purporting to conduct affairs for the 

Tribe. One entity expressly assumed liability to SMDC under the 

SMDC agreement as a successor in interest to the contracting 

party and settled claims against the predecessors in interest, 

while the other entity alleged it was the contracting party, but 

refused to admit liability to SMDC. The trial court dismissed all 

actions by or against the settling entity as to Stein, and SMDC. 

The court noted the question was whether the non-settling 

entity was the real party in interest as to the Tribe’s complaint 

and SMDC’s complaint. If not, the Tribe’s complaint should be 

dismissed based on the settlement. However, by alleging that it 

was the contracting party, the non-settling entity contended it 

was the real party in interest as to all of the consolidated actions. 

SMDC was not entitled to dismissal of any claims that the nonsettling entity might have in the consolidated actions. Because 

the non-settling entity alleged that it succeeded to the benefits 

and burdens of the SMDC agreement, none of the parties named 

as “tribes” in any consolidated action may be dismissed. 
25

B. Dismissals from SMDC’s Complaint

On April 30, 2008, SMDC filed a dismissal of all causes of 

action against the Tribe that had been stated in SMDC’s 

complaint. After filing additional dismissals, the remaining 

causes of action in SMDC’s complaint were claims against 

“Gabrielino/Tongva Nation,” as substituted for Doe defendant 1, 

and claims against the individual defendants for intentional and 

negligent interference with contract, and fraudulent conveyance.

C. Dismissals from Stein and SMDC’s Crosscomplaint

Also on April 30, 2008, SMDC dismissed all causes of action

against “Gabrielino-Tongva Tribe” stated in the September 26, 

2007 cross-complaint.3 The causes of action alleged in the 

September 26, 2007 cross-complaint against the individual 

defendants continued to be total indemnity, equitable indemnity 

and apportionment, contribution, and declaratory relief.

D. Settlement and Dismissals from Crane Complaint

On April 24, 2008, Crane filed an amendment to its

complaint substituting “Gabrielino/Tongva Nation” in place of 

Doe defendant 8. A few days later, on April 30, 2008, Crane filed 

3 The request for dismissal incorrectly referred to the filing 

date of the cross-complaint at issue as September 27, 2007.
26

a dismissal of all causes of action against “Gabrielino-Tongva 

Tribe” in its complaint.

Years later, on September 25, 2011, Crane entered into a 

settlement agreement under which the Candelaria Group 

acknowledged the Tribe’s debt to Crane in the amount of 

$386,492. On October 19, 2011, Crane filed another dismissal of 

all causes of action in its complaint against “Gabrielino-Tongva 

Tribe,” as well as those against Gabrielino Tribal Gaming 

Authority. 

As a result of additional dismissals, the causes of action 

remaining in Crane’s complaint were claims against 

“Gabrielino/Tongva Nation,” as substituted for Doe defendant 8, 

and claims against the individual defendants for intentional and 

negligent interference with contract, and fraudulent conveyance.

Summary Judgments and Appeals

On September 26, 2008, the trial court granted Polanco’s 

motion for summary judgment as to SMDC’s complaint, Crane’s 

complaint, and SMDC and Stein’s cross-complaint. (St. Monica 

Development Co. v. Polanco (July 19, 2010, B211466) [nonpub. 

opn.].) Another panel of this appellate court ultimately reversed 

the summary judgment ruling, finding that triable issues of fact 

existed concerning the identities of the tribal associations.

On October 14, 2008, SMDC obtained an entry of default in 

its action against “Gabrielino/Tongva Nation, a California 

unincorporated association, a successor in interest to GabrielinoTongva Tribe, aka Doe No. 1” and Crane obtained an entry of 

default in its action against “Gabrielino/Tongva Nation, a 

California Unincorporated Association, aka Doe #8.”
27

Stein and SMDC filed motions for summary judgment of 

the Tribe’s complaint, arguing that they had settled all claims 

with the “Gabrielino-Tongva Tribe,” judgment had been entered 

by the trial court, and the claims pursued by the Tribe should be 

dismissed. They claimed the entity remaining in litigation was a 

breakaway group called “GT Nation,” which came into existence 

after Stein was terminated as an officer of the Tribe.

The Tribal Council denied that it was a breakaway group, 

attesting that it was the tribal entity which had contracted with 

SMDC, hired and fired Stein, filed the instant lawsuit, and had 

sole authority to prosecute or settle the Tribe’s lawsuit. The trial 

court granted the summary judgment motions. The court 

concluded that the Tribe failed to submit evidence raising a 

triable issue of fact as to why the settlement agreement, which 

plainly called for dismissal of the Tribe’s action against SMDC 

and Stein, was not determinative. The Tribe appealed the 

judgments.

On appeal in that matter, Stein and SMDC contended they 

were entitled to judgment as a matter of law, because the tribal 

entity that sued them entered into a written agreement settling 

all of its claims against them. In an unpublished opinion, 

another panel of this appellate court concluded that the evidence 

was rife with disputed issues of material fact, including whether 

the Candelaria Group had authority to settle the plaintiff’s 

claims in the instant case against Stein and SMDC. Stein and 

SMDC had not met their burden on summary judgment, and the 

judgments were reversed. (Gabrielino-Tongva Tribe v. St. 

Monica Development (Nov. 8, 2013, B238603) [nonpub. opn.].)
28

Claims Pending for Trial

The action was reassigned to Judge Yvette M. Palazuelos. 

The Tribe sought an order that the only claims pending for trial 

were those in the Tribe’s complaint against Stein, the Law 

Offices, and SMDC. After a hearing on July 29, 2014, Judge 

Palazuelos issued an order concerning the claims for trial.

Stein and SMDC argued the Tribal Council members had 

authority to act for “Gabrielino/Tongva Nation,” which SMDC 

substituted in its complaint in place of a Doe defendant. Defaults 

had been entered against “Gabrielino/Tongva Nation” with 

respect to SMDC’s complaint and Crane’s complaint, and Stein 

and SMDC argued that “Gabrielino/Tongva Nation” was not the 

real party in interest for purposes of the Tribe’s complaint.

The Tribe responded that its identity was “GabrielinoTongva Tribe,” the name under which it had commenced the 

litigation. The Tribal Council refused to relinquish its tribal 

name to the Candelaria Group, and a dispute existed between the 

parties as to whether the party’s name had changed during the 

course of the action. Default was improper, because the Tribe 

filed an answer to SMDC’s complaint under the party name that 

it had used throughout. Stein and SMDC could not obtain 

defaults against the Tribe for refusing to give up its name and 

refusing to assume the name that Stein and SMDC wanted it to 

use. Through a fictitious name designation, Stein and SMDC 

implied that the Tribe was a new party to the action, when the 

Tribe had been an active participant since the inception of the 

litigation. Doe amendments were appropriate when a claimant 

was truly ignorant of the defendant’s true name. There was no 

evidence that “GT Nation” was the Tribe’s name. Stein and 
29

SMDC could not obtain a default against the Tribe by referring to 

it as “GT Nation,” when the Tribe had commenced litigation as 

“Gabrielino-Tongva Tribe” and filed an answer in at least one 

case. 

The court concluded the defaults were inoperative against 

the Tribe, and the claims in the Tribe’s complaint could proceed 

to trial. Stein argued that the real party in interest and the 

Tribal Council’s authority to act for the Tribe were disputed 

issues to be established at trial. In addition, if the Tribe was the 

real party in interest, Stein argued, the Tribe was liable for the 

claims against it. The dismissals never applied to the Tribe; they 

applied to the Candelaria Group.

The court concluded, due to the triable issues of fact 

concerning the identity of the real party in interest and the 

settlement agreement, the defendants’ claims could proceed to 

trial as well. The court noted that after trial, the court might 

conclude the claims in the SMDC complaint and the operative 

cross-complaint did not survive, but for purposes of going 

forward, the court allowed the claims in the SMDC complaint and 

the operative cross-complaint to proceed to trial. The court 

similarly allowed Crane’s claims to move forward.

Trial

A trial began in June 2016, and was conducted in three 

phases. In the first phase, on July 5, 2016, the jury found the 

Tribe, also referred to during trial as the Dunlap Faction, had 

standing and the capacity to sue in the instant action. 

Stein requested a bench trial for the remainder of the case.

The second phase of the trial was frequently suspended over the 
30

next two years, primarily due to Stein’s health issues. Crane 

participated in the trial.

The Tribe’s gaming expert, Phil Hoag, testified that if the 

Tribe were federally recognized, the SMDC agreement would be 

invalidated and unenforceable under federal regulations due to 

the ownership interest of a non-tribe member.

The Tribe’s ethics expert, Arthur Margolis, opined that 

there was an attorney-client relationship between Stein and the 

Tribe, despite statements in the SMDC agreement that no 

attorney-client relationship was created. He explained Stein’s 

numerous violations of the Rules of Professional Conduct and 

breaches of his fiduciary duties to the Tribe.

Stein testified as to the following. Although the state 

recognized the Gabrielinos as a tribe, it never took the next step 

to recognize a single governing body. Libra was an investment 

bank that organized multiple investment funds. Stein negotiated 

the substance of the agreement with Libra’s representatives 

Sammy Lai and Jess Ravich. Libra was required to provide $2.15 

million under the agreement, and could fund, within its 

discretion, up to $21 million. Libra was not required to provide 

any particular amount after $2.15 million. There was an agreed 

budget for the first $2.15 million, and the Libra agreement 

expressly prohibited use of the investor funds for any purpose 

other than the agreed budget. To obtain another $2 million, the 

Tribe had to submit a new budget, and Libra had absolute 

discretion over whether to fund the new budget. 

Senator Vincent agreed to introduce legislation with the 

language that Stein put in his draft legislation, which was 

attached to the Libra agreement as exhibit B. Stein told the 

Tribal Council that Senator Vincent would “gut-and-amend” 
31

Senate Bill No. 175 in the form shown in exhibit B. The 

document was sent to the Legislative Counsel, but never became 

a prebill. The Legislative Counsel’s May 22, 2006 opinion was a 

preliminary opinion in response to the document Stein drafted as 

Senate Bill No. 175. Generally, the Legislative Counsel releases 

a preliminary opinion, and after negotiations, issues a final 

opinion. Stein admitted that the Legislative Counsel opinion 

made it less likely that Stein’s draft would become legislation, 

because Stein had to negotiate with the Legislative Counsel and 

get Senator Vincent to “put the bill over the desk to become 

public.” In Stein’s view, however, the Legislative Counsel opinion 

was a little bump in the road and not a big deal. Senator Vincent 

told Stein that he was facing substantial pressure not to put the 

legislation forward publicly from tribes that had casino 

operations and he would be committing political suicide to do so. 

In Stein’s September 27, 2006 email to Libra and others, he 

was concerned about whether political contributions that had 

been promised would be made by a deadline on September 30, 

2006. Stein stated, “In addition, I was hoping that we would 

actually move forward and begin the next phase with the 

investors because that’s a phase process. To get money in 

January, you’ve got to start early, and this was already the end of 

September.” When asked if there was a realistic possibility as of 

September 27, 2006, that the Tribe was getting the next tranche 

from the Libra investors, Stein answered that there was not.

Stein had been hoping there was, but it was not a realistic hope 

because of the Tribe’s subsequent actions. When asked what 

evidence he had that Libra would not have paid the next tranche, 

Stein said a Libra representative told him that Libra would wait 

until the dispute was resolved.
32

Attorney McShane testified as well. Stein told McShane 

that future tranches of money may become available, but if the 

investors perceived problems, they did not have an obligation to 

advance further funds.

Stein’s attorney Kenneth Sulzer testified. SMDC named 

Libra as a defendant in its complaint because Libra had provided 

funds to the Tribe and said they would consider more. If Libra 

gave more funding to the Tribe, SMDC wanted to make sure to be 

paid out of the additional funding. Because of the dispute 

between SMDC and the Tribe, it was clear that SMDC would not 

be paid from any funds that the Tribe received from Libra, so the 

complaint was a mechanism to resolve the dispute between 

SMDC and the Tribe without those funds disappearing. SMDC’s 

desire was to work everything out and keep the money flowing, 

but not get cut out of the deal.

Tribal Council member Carmelo testified that in 2001, five 

groups of Gabrielino tribe members were operating separately.

The Libra agreement provided a smaller initial investment to 

help the Tribe in their effort to seek federal recognition. The 

Tribe believed it had state recognition, and that from state 

recognition, the Tribe would be able to have gaming in California.

Once funds came in and the Tribe was discussing a new budget 

for the following year, people were fighting over where to spend 

the money and the budget for funds that were going to come in.

Tribal Council member Loya testified. Under the Libra 

agreement, the first tranche of funds was to “secure our process.”

Another tranche was going to come in soon after, as long as 

everything checked out, including the Tribe’s accounts and 

balances, and the Tribe submitted budgets that Libra approved. 
33

He believed the Libra agreement was intended to fund the casino, 

not the federal recognition process.

Daniel Crane, the lobbyist who owns Crane, testified about 

Crane’s right to payment under the Crane agreement and the 

evidence to support quantum meruit. In June 2006, Crane 

accepted $50,000 from the Tribe as the first installment of the 

amount owed under the Crane agreement, and Stein assured him 

that additional payments would be made. There was a 

reasonable expectation at that time that additional investment 

money would be forthcoming. Crane believed the value of the 

services that his company rendered was $262,000, plus interest.

The trial court asked several questions about the work conducted 

by Crane after receiving payment from the Tribe. Crane stated 

that his firm does not track the time spent on work for any client; 

he could not estimate how much time Crane spent working on 

matters for the Tribe during 23 months of the Crane agreement.

He added, “It would require considerable effort to go back and 

reconstruct my time.” Crane described several activities that 

were performed to benefit the Tribe. The court asked if there was 

any corroboration of the hours and the work performed. Crane 

stated there was not, because relationships were built over many 

years, but an agreement could be reached in minutes, so the 

hourly billing model did not provide fair compensation. Even 

though the Crane agreement contemplated the potential for 

quantum meruit recovery, Crane admitted that the firm did not 

keep time sheets for any client and did not have time records to 

support their work.
34

Punitive Damages Phase, Judgment, and Statement of 

Decision

On November 8, 2018, the trial court ruled in favor of the 

Tribe and against Stein, Law Offices, and SMDC, on all causes of 

action in the Tribe’s complaint. The court found Stein, Law 

Offices, and SMDC acted with malice, oppression, and fraud, so 

held a third phase of trial on the issue of punitive damages, 

described in more detail in the discussion. 

On August 27, 2019, the trial court issued a statement of 

decision. The court noted that the following pleadings were at 

issue: the Tribe’s fourth amended complaint, Stein and SMDC’s 

September 26, 2007 cross-complaint, SMDC’s amended 

complaint, Dunlap’s cross-complaint, and Crane’s complaint. In 

footnotes, the court explained the dismissals of parties from the 

various pleadings. The court also noted the original crosscomplaint that Stein and SMDC filed in the Tribe’s action on 

August 20, 2007, was never served. The court found there was no 

evidence that the Tribe was “state recognized” or that the State of 

California had state recognized tribes.

The court found Stein had committed multiple acts of fraud 

against the Tribe. Stein committed fraud when he attached a 

document as exhibit B to the Libra agreement that purported to 

be a California Senate Bill authored, introduced, and amended by 

Senator Vincent. Exhibit B led the Tribe, through Carmelo, to 

believe the Tribe could operate casino gaming in California 

because actual legislation had been introduced on the Tribe’s 

behalf. Stein failed to disclose to the Tribe that two days after 

the Libra agreement was executed, the California Legislative 

Counsel issued an opinion to Senator Vincent that the 
35

Legislature had no power to authorize a non-federally recognized 

Indian tribe to engage in gaming activities, even if the tribe were 

recognized by the state.

Stein’s July 15, 2006 email acknowledged his 

representation that exhibit B to the Libra agreement was 

authored by Senator Vincent was a lie. Although he told the 

Libra investors that the legislation was authored and introduced 

by a lawmaker, he had lied. Stein admitted at trial that he 

drafted the document attached as exhibit B. The Tribe did not 

know whether Senate Bill No.175 had been introduced by 

Senator Vincent until Stein revealed in the email that he had lied 

to the Libra investors.

Stein also committed fraud by accusing the Tribal Council 

of stealing funds and freezing their bank accounts when he had 

no good faith basis to do so, and after he ceased to have actual 

authority over any aspect of the Tribe. He committed fraud by 

omission when he failed to advise the Tribe of the basic fact that 

the SMDC agreement would be rejected by the federal gaming 

authority if the Tribe achieved federal recognition, and he failed 

to advise them because it was against Stein’s own interest.

In addition, Stein committed fraud when he caused 

Candelaria to file a statement of unincorporated association 

claiming to be a representative of the Tribe, when he had no good 

faith basis to believe that she had a right to do so. He falsely 

represented to members of the Tribe that the Candelaria Group 

acted for the Tribe, knowing the representation to be false, and 

continued to do so even after the jury found the Tribe, as 

represented by the Tribal Council, was the real party in interest 

in the case. Stein had no reasonable basis to believe his 

representations to be true, but made them knowingly in order to 
36

defraud tribal members, potential members, the public, former 

investors, potential investors, and the court. Stein made these 

false representations to usurp all of the Tribe’s legal rights and 

obligations. The court found “Stein damaged the Tribe by 

deceiving the Tribe’s members about the split between Stein and 

the Tribe thereby causing the Libra investors, who had 

committed to supporting the Tribe, [to withdraw] financial and 

other support. The loss is more than $18,000,000 which had been 

pledged by the Libra investors but was lost because of Stein’s 

fraudulent conduct.” The Tribe also suffered a loss of reputation, 

as it was forced to deny Stein’s charges that the Tribal Council 

members had stolen money from the Tribe.

The court found the language of the SMDC agreement 

disclaiming an attorney-client relationship was not dispositive, 

and instead, the extensive facts and the law strongly supported 

finding an attorney-client relationship was created based on the 

intent and the conduct of the parties. Stein had numerous 

conflicts of interest. He had a conflict when he advised the Tribe 

that it did not need to achieve federal recognition to engage in 

gaming. He violated rule 3-310 when he failed to advise the 

Tribe that he had an adverse interest. He violated rule 3-300 by 

failing to advise the Tribe when he acquired a financial interest 

adverse to the Tribe’s interest, that he had to give the Tribe a 

meaningful opportunity to consult with another lawyer.

Even if Stein were not acting as the Tribe’s lawyer, he 

breached his fiduciary duties to the Tribe through his acts as an 

officer of the Tribe. He breached his duty of candor. He also 

breached his fiduciary duties by pursuing a strategy that would 

not achieve federal recognition for the Tribe because it would 

affect his rights to recover future gaming revenue. He acted in 
37

his own interest and against the tribe’s interest because it would 

be more financially advantageous to him in the long run, despite 

the Tribe’s express desire for federal recognition. Other conduct 

that breached Stein’s fiduciary duties included sending letters to 

the Tribe membership without the Tribal Council’s consent or 

knowledge, freezing the Tribe’s bank account, and demanding the 

Libra investors pay him instead of the Tribe. Stein was also 

liable for malpractice based on the same advice, 

misrepresentations, and actions.

The court found Stein was liable for conversion of the 

Tribe’s property. Stein admitted that he retained possession of 

the Tribe’s membership and financial records after his 

relationship was unambiguously terminated. He used the 

information, computers, and documents for his own purposes, 

including sending letters to financial institutions and the 

membership to disparage the Tribal Council and gain support for 

himself. He has not returned the records or computers. The 

court found the Tribe’s damages were established because the 

Tribe had not been able to use their property for 12 years, 

diminishing the value of some items and depriving the Tribe of 

the opportunity to conduct business with others or pursue federal 

recognition. Stein was also liable for breach of confidence and 

misappropriation of trade secrets in the form of the confidential 

membership records. 

Stein was liable for intentional interference with the 

Tribe’s economic relationships and prospective economic 

relationships. Stein and SMDC interfered with the Tribe’s 

contract with the Libra investors. Stein intentionally disrupted 

the relationship with Libra when he did not get to spend the 

Libra money in the way that he wanted. He threatened to send 
38

the money back to Libra, rather than continue working with the 

Tribe. Once Stein’s dispute started with the Tribe, Stein and 

SMDC wanted Libra to pay Stein any monies owed by the Tribe 

to Stein. Stein and SMDC insisted that they be first in line for 

payment. By refusing to withdraw until the monies were paid, 

even though Stein was aware that he had no right to payment 

from the Libra funds, Stein interrupted the Libra agreement. 

Because Libra did not deviate from the original intention of its 

agreement with the Tribe, which had nothing to do with payment 

to Stein, and did not want to pay Stein, Stein’s threat came to 

fruition. The court added, “Stein’s demand to Libra also revealed 

that Stein and [his attorney] Sulzer had a high degree of 

confidence that the $18 million that Libra had promised to the 

Tribe would be forthcoming imminently.”

The court found Stein interfered with the Tribe’s 

prospective economic advantage for the same reason. The future 

economic prospect was the funding that Libra promised to invest 

in subsequent tranches. Stein wanted the Tribe and Libra to 

promise to use subsequent tranches to pay him or he would 

disrupt the relationship. He did disrupt the relationship. The 

damages were the remainder of the $21 million of Libra funds 

that Libra had promised to the Tribe but that were cut off 

because of Stein.

The SMDC agreement was subject to rescission because 

Stein violated important ethical rules subjecting transactions 

between attorneys and clients to strict scrutiny for fairness and 

full disclosure. Stein violated rule 3-300 by acquiring an interest 

that guaranteed 10 percent of future casino gaming revenue to 

SMDC, as well as by drafting the SMDC agreement and Tribe 

resolutions. The Tribe members who reviewed the SMDC 
39

agreement did not understand it, and it was not explained in a 

manner that they could understand. They were not given copies 

to review, so had no meaningful opportunity for an independent 

lawyer to explain it to them. Stein misled the signatories about 

whether they had an outside lawyer representing them. Stein 

did not overcome the presumption that the SMDC agreement was 

without adequate consideration, and therefore, the result of 

undue influence. If Stein had complied with the rule, 

independent counsel would have explained to the Tribe that the 

goals of federal recognition and casino operations were 

incompatible under the SMDC agreement because of the sole 

proprietary interest rule that invalidates SMDC’s interest. The 

sole proprietary interest rule is intended to protect Native 

American tribes from the type of unfairness embodied in the 

SMDC agreement. The fact that Stein sought to evade the rule 

by not pursuing federal recognition, which was an important goal 

of the Tribe, compounded the unfairness. Therefore, the court 

voided the SMDC agreement at the Tribe’s election.

The SMDC agreement was voidable and subject to 

rescission, but alternatively, Stein breached the SMDC 

agreement, as well as the implied covenant of good faith and fair 

dealing. In addition, Stein and SMDC were liable for unfair 

competition in violation of Business and Professions Code section 

17200, based on the claims stated against Stein, including 

unlawfully retaining the Tribe’s books and records, 

misappropriation of trade secrets, and fraud. As a result, the 

Tribe was entitled to restitution of the amount paid to Stein and 

SMDC under the SMDC agreement.

The court found the entity that Stein created for the 

Candelaria Group existed for the sole purpose of attempting to 
40

deceive tribe members and the public about the true identity of 

the Tribe, and usurp the Tribe’s legal rights and obligations.

Stein, SMDC, and the Law Offices were alter egos. The 

Law Offices were merely a “doing business as” (d.b.a.) entity for 

Stein. Stein, the Law Offices, and SMDC shared the same 

address on Santa Monica Boulevard. They used the same staff

services, even though the legal assistant was employed solely by 

the law office. Stein appointed his legal assistant as a “Tribal 

Administrator” for the Tribe, and she reported to Stein for all of 

the various entities. Stein was the sole shareholder and manager 

of SMDC. SMDC is inadequately capitalized and has no assets 

whatsoever. Stein disregarded corporate formalities on behalf of 

SMDC. Stein paid expenses for the Tribe out of SMDC funds or 

his own pocket. Stein, SMDC, and the Law Offices were one and 

the same, and must be treated that way for purposes of liability.

Stein’s documentation to support his quantum meruit claim 

was heavily redacted and simply totaled hours that he claimed he 

worked on behalf of the Tribe. The court was not persuaded that 

the document represented work that Stein performed on behalf of 

the Tribe alone and for which he would be entitled to 

compensation under the SMDC agreement.

The court found by clear and convincing evidence that 

Stein’s conduct, individually and through his alter egos, was 

fraudulent, despicable, oppressive, and malicious. Extensive 

evidence of fraud against the Tribe beginning from the inception 

of the relationship was at the center of the case, as described in 

more detail in the discussion of punitive damages below. The 

court awarded $7 million in punitive damages. 

The court concluded Stein and SMDC’s August 20, 2007

cross-complaint was filed, but never served. There was no proof 
41

of service, despite the court having given Stein leave to file proof 

of service years after the cross-complaint was filed. Even if the 

cross-claims were not inoperative for failure to serve it, however, 

the court found the SMDC agreement was voidable and subject to 

rescission by the Tribe, so Stein and SMDC’s breach of contract 

claim was extinguished. The remaining claims for account stated 

and quantum meruit were also extinguished, because Stein failed 

to provide any persuasive evidence that he did the work that he 

claimed. He submitted two incomplete, heavily redacted 

documents that had no indicia of reliability and failed to 

persuade the court. Stein failed to carry his burden that he did 

the work claimed, and he refused to provide unredacted copies of 

the documents. The court inferred that unredacted copies likely 

contained evidence that Stein billed work for other legal clients 

and wrongfully charged the Tribe, or that Stein performed

extensive legal work for the Tribe as the Tribe’s lawyer.

Crane failed to submit competent, persuasive evidence that 

it performed any work for the Tribe at all. Daniel Crane testified 

that he did some federal work for the Tribe, but was unable to 

show any tangible work product that he produced for the Tribe or 

any evidence that he had actually done any work for the Tribe.

The court concluded Crane failed to carry its burden to show it 

had done the work claimed. In addition, Crane’s contract with 

the Tribe stated no money was due until the Tribe received more 

than $2 million in investment funds. The Tribe received only one 

tranche of investment funds totaling $1.8 million. Because the 

Tribe never acquired more than $2 million in investor funds, due 

to Stein’s interference with the Libra agreement, the obligation to 

pay Crane was never triggered.
42

On the Tribe’s complaint, the court found in favor of the 

Tribe and against Stein, Law Offices, and SMDC, jointly and 

severally, as to all causes of action. The SMDC agreement was 

rescinded and void. The court enjoined the defendants from 

retaining possession or control of any files, documents, or other 

property belonging to the Tribe, including the Tribe’s 

membership records, financial records, internet domain name, 

and website. The defendants were also enjoined from using the 

Tribe’s confidential information, including membership records 

and financial information. Stein, Law Offices, and SMDC were 

also prohibited from: contacting or soliciting any member of the 

Tribe for any purpose relating to any tribal membership or casino 

gaming project; disclosing or disseminating any of the Tribe’s 

confidential information; destroying or otherwise making 

unavailable to the Tribe any documentary, computer, or other 

evidence relevant to the litigation in the defendants’ control; 

holding themselves out to be the office of, or affiliated with, the 

Tribe; or executing on any order or writ for the Tribe’s property. 

The court ordered the defendants to deliver all of the Tribe’s 

information, computers, and electronic equipment within 30 days 

of service of the judgment.

On the causes of action for conversion, breach of fiduciary 

duty, misappropriation of trade secrets, breach of confidence,

intentional and negligent interference with economic 

relationships, legal malpractice, violation of the Penal Code, 

unfair competition, and fraud, the court ordered judgment in 

favor of the Tribe and against Stein, Law Offices, and SMDC, 

jointly and severally, in the amount of $20,411,067.23. The 

statement of decision erroneously stated the calculation of 

damages was based on $21,000,000, minus $800,000 attributed to 
43

Libra, $161,067.23 paid to the Tribe, and $50,000 paid Crane. 

On the declaratory relief cause of action, the court declared that 

the Tribe was the real party in interest with standing to pursue 

the litigation. On the cause of action for alter ego liability, the 

court found Stein, Law Offices, and SMDC were alter egos, jointly 

and severally liable for the obligations of each other. The Tribe 

was entitled to recover attorney fees and costs. In addition, 

Stein, Law Offices, and SMDC acted with malice, oppression, and 

fraud.

On Stein and SMDC’s September 26, 2017 cross-complaint, 

the court found in favor of Aronson, Polanco, and each of the 

Tribal Council members, and against Stein, Law Offices, and 

SMDC.

On SMDC’s complaint, the court found in favor of Aronson, 

Polanco, and each of the Tribal Council members on all causes of 

action. On Dunlap’s cross-complaint, the court found against 

Dunlap on all causes of action. 

On Crane’s complaint, the court found against Crane on the 

causes of action for interference with contractual relations and 

fraudulent conveyance, in favor of Aronson, Polanco, and each of 

the Tribal Council members.

The court ordered Stein, the Law Offices, and SMDC, 

jointly and severally, to pay punitive damages of $7 million to the 

Tribe.

That same day, on August 27, 2019, the trial court entered 

judgment consistent with the statement of decision. Stein and 

SMDC filed a motion for new trial, which was denied by Judge 

David S. Cunningham, III. Stein, SMDC, and Crane filed a 

timely notice of appeal from the judgment.
44

DISCUSSION

Standard of Review

The substantial evidence standard of review applies to 

appeals challenging factual findings in a jury or bench trial. 

(Jameson v. Five Feet Restaurant, Inc. (2003) 107 Cal.App.4th 

138, 143.) “Under this deferential standard of review, findings of 

fact are liberally construed to support the judgment and we 

consider the evidence in the light most favorable to the prevailing 

party, drawing all reasonable inferences in support of 

the findings.” (Thompson v. Asimos (2016) 6 Cal.App.5th 970, 

981.) “A single witness’s testimony may constitute substantial

evidence to support a finding. [Citation.] It is not our role as a

reviewing court to reweigh the evidence or to assess witness 

credibility.” (Ibid.)

“ ‘A judgment or order of a lower court is presumed to be 

correct on appeal, and all intendments and presumptions are 

indulged in favor of its correctness.’ [Citation.] Specifically, 

‘[u]nder the doctrine of implied findings, the reviewing court 

must infer, following a bench trial, that the trial court impliedly 

made every factual finding necessary to support its decision.’ ” 

(Thompson v. Asomos, supra, 6 Cal.App.5th at p. 981.)

“Matters presenting pure questions of law, not involving 

the resolution of disputed facts, are subject to de novo review.” 

(Shewry v. Begil (2005) 128 Cal.App.4th 639, 642.)
45

Statement of Decision

Stein and SMDC contend that the statement of decision 

should not be afforded any deference on appeal, because the trial 

court adopted the statement of decision proposed by the Tribe 

without making any of the changes suggested by Stein and 

SMDC. Although Stein and SMDC have failed to explain the 

relevance of their contention as to any specific issue, we conclude 

their analysis is incorrect.

Under Code of Civil Procedure section 632, upon a party’s 

request after trial, the court must issue a statement of decision 

“explaining the factual and legal basis for its decision as to each 

of the principal controverted issues at trial.” Under Code of Civil 

Procedure section 634, if the statement of decision does not 

resolve a controverted issue or is ambiguous, and the omission or 

ambiguity was brought to the attention of the trial court, “it shall 

not be inferred on appeal . . . that the trial court decided in favor 

of the prevailing party as to those facts or on that issue.”

Even when the procedures specified in Code of Civil 

Procedure sections 632 and 634 have been followed, the “trial 

court is not required to respond point by point to the issues posed 

in a request for statement of decision. The court’s statement of 

decision is sufficient if it fairly discloses the court’s determination 

as to the ultimate facts and material issues in the case.” (Golden 

Eagle Ins. Co. v. Foremost Ins. Co. (1993) 20 Cal.App.4th 1372, 

1379–1380.) “In addition, ‘[e]ven though a court fails to make a

finding on a particular matter, if the judgment is otherwise 

supported, the omission is harmless error unless the evidence is 

sufficient to sustain a finding in favor of the complaining party 
46

which would have the effect of countervailing or destroying other

findings.’ ” (Thompson v. Asimos, supra, 6 Cal.App.5th at p. 983.)

“The trial court is specifically authorized to designate a 

party to prepare the statement of decision [citations] and thus is 

required only to review the statement and any objections thereto 

and to make or order to be made any corrections, additions, or 

deletions it deems necessary or appropriate.” (Miramar Hotel 

Corp. v. Frank B. Hall & Co. (1985) 163 Cal.App.3d 1126, 1129.)

In this case, the trial court provided the proper statutory 

procedures. There is no evidence that the trial court did not read 

the statement of decision prepared by the Tribe or review the 

objections made by Stein and SMDC. Stein and SMDC have not 

shown that any finding in the statement of decision failed to 

properly reflect the decision of the trial court. In fact, Stein and 

SMDC contend this court may review their contentions on appeal 

de novo because the facts are undisputed.

Rescission of the SMDC Agreement

Stein contends the trial court erred in rescinding the 

SMDC agreement based on a violation of former rule 3-300 for 

several reasons: (1) there was no implied attorney-client 

relationship, because the SMDC agreement expressly provided 

that Stein was not the Tribe’s attorney; (2) the requirements of 

former rule 3-300 were met, and the Tribe affirmed that the 

SMDC agreement was valid, binding, and enforceable, or waived 

its right to rescind; and (3) even if the SMDC agreement were 

properly rescinded, SMDC was entitled to compensation. We 

conclude substantial evidence supports the trial court’s findings 

on rescission.
47

A. Implied Attorney-client Relationship

Stein’s first contention is that no attorney-client 

relationship existed between himself and the Tribe. However, 

substantial evidence supports the trial court’s finding of an 

implied attorney-client relationship.

The practice of law includes providing legal advice and 

preparing legal instruments and contracts that secure legal 

rights, in addition to performing services in court. (Benninghoff 

v. Superior Court (2006) 136 Cal.App.4th 61, 68.) An attorneyclient relationship can only be created by express or implied 

contract. (Koo v. Rubio’s Restaurants, Inc. (2003) 109 

Cal.App.4th 719, 729.)

A lawyer may provide nonlegal services without creating an 

attorney-client relationship or may limit the scope of 

representation to certain matters, but a contract provision that 

purports not to create an attorney-client relationship does not by 

itself prevent the existence of an attorney-client relationship. 

(Benninghoff v. Superior Court, supra, 136 Cal.App.4th at p. 73 &

fn. 10.) It is the legal effect of an instrument, rather than the 

label that the parties place on their relationship, that determines 

the nature of the agreement. (Ibid.; see State Bar Standing Com. 

on Prof. Responsibility and Conduct, Formal Opn. No. 1999–154 

[lawyer performing nonlegal services may disclaim intent to 

provide legal services, but disclaimer is not effective if lawyer in 

fact performs legal services or offers legal advice].)

“In determining the existence of an attorney-client 

relationship we should ask whether the ‘totality of the 

circumstances’ so indicate. [Citation.] ‘The question of whether 
48

an attorney-client relationship exists is one of law. [Citations.]

However, when the evidence is conflicting, the factual basis for 

the determination must be determined before the legal question 

is addressed.’ ” (Koo v. Rubio’s Restaurants, Inc., supra, 109 

Cal.App.4th at p. 732.)

In this case, the trial court found the language of the 

SMDC agreement disclaiming an attorney-client relationship was 

not dispositive. Extensive facts strongly supported finding an 

attorney-client relationship was created based on the intent and 

the conduct of the parties. From the beginning, Stein stated that 

he kept internal records of his time for a fair and accurate 

measure of the legal costs to be charged against each financing 

transaction. Stein hired all of the Tribe’s outside attorneys, 

supervised their work closely, and fired them. At times, Stein 

drafted documents for the Tribe and was the sole attorney to 

provide advice about important legal transactions. Tribe 

members believed Stein was acting as the Tribe’s attorney, and 

when tribe members referred to Stein as the Tribe’s attorney, he 

did not correct them. There was ample evidence of an implied 

attorney-client relationship from the parties’ intent and conduct.

B. Former Rule 3-300

Stein contends that even if an attorney-client relationship 

existed, the requirements of former rule 3-300 were met. We 

conclude substantial evidence supports the trial court’s finding 

that Stein’s violation of former rule 3-300 permits rescission of 

the SMDC agreement.

Former rule 3-300, which has been revised and renumbered 

as current rule 1.8.1, governs an attorney’s obligations when 
49

entering into a business transaction with a client. At the time 

that the parties executed the SMDC agreement, former rule 3-

300 provided: “A member shall not enter into a business 

transaction with a client; or knowingly acquire an ownership, 

possessory, security, or other pecuniary interest adverse to a 

client, unless each of the following requirements has been 

satisfied: [¶] (A) The transaction or acquisition and its terms are 

fair and reasonable to the client and are fully disclosed and 

transmitted in writing to the client in a manner which should 

reasonably have been understood by the client; and [¶] (B) The 

client is advised in writing that the client may seek the advice of 

an independent lawyer of the client's choice and is given a 

reasonable opportunity to seek that advice; and [¶] (C) The 

client thereafter consents in writing to the terms of the 

transaction or the terms of the acquisition.”

A “ ‘transaction between an attorney and client which 

occurs during the relationship and which is advantageous to the 

attorney is presumed to violate that fiduciary duty and to have 

been entered into without sufficient consideration and under 

undue influence.’ [Citation.] As explained long ago in Felton v. 

Le Breton (1891) 92 Cal. 457, 469: ‘While an attorney is not 

prohibited from having business transactions with his client, yet, 

inasmuch as the relation of attorney and client is one wherein the 

attorney is apt to have very great influence over the client, 

especially in transactions which are a part of or intimately 

connected with the very business in reference to which the 

relation exists, such transactions are always scrutinized by 

courts with jealous care, and are set aside at the mere instance of 

the client, unless the attorney can show by extrinsic evidence 

that his client acted with full knowledge of all the facts connected 
50

with such transaction, and fully understood their effect; and in 

any attempt by the attorney to enforce an agreement on the part 

of the client growing out of such transaction, the burden of proof 

is always upon the attorney to show that the dealing was fair and 

just, and that the client was fully advised.’ ” (BGJ Associates v. 

Wilson (2003) 113 Cal.App.4th 1217, 1227–1228.)

The SMDC agreement provided Stein with a substantial 

financial interest adverse to the Tribe’s interest in obtaining

federal recognition, yet Stein did not explain his adverse interest 

or give the Tribe a reasonable opportunity to seek the advice of 

an independent attorney. Instead, Stein misrepresented that 

attorney Otto was acting as the Tribe’s counsel, knowing that 

Otto expressly refused to represent the Tribe. The trial court 

concluded that Stein deliberately lied to the Tribe about Otto 

acting as their lawyer to induce the Tribe to sign the SMDC 

agreement without the benefit of counsel and to take advantage 

of the Tribe. When Stein presented the SMDC agreement to the 

Tribe, the Tribal Council members were not given time to read 

the document, take it home, or have a meaningful opportunity for 

an independent lawyer to review it. They signed the document 

under duress, without the benefit of counsel, and without 

understanding that Stein’s interest was adverse to the Tribe’s 

goal of federal recognition. Substantial evidence supported the 

trial court’s conclusion that Stein violated former rule 3-300, and 

as a result, the SMDC agreement was voidable by the Tribe.
51

C. Waiver

Stein further contends that the Tribe waived its right to 

rescind, because the Tribe knew all the facts on which rescission 

was sought, but delayed rescinding. This is incorrect.

“The general rule is that a defrauded party must exercise 

his election to rescind with reasonable promptness after 

discovering the fraud. A delay in rescission is evidence of a 

waiver of the fraud and an election to treat the contract as 

subsisting. Any acts indicating an intent to abide by the contract 

are evidence of an affirmance thereof and of a waiver of the right 

to rescind.” (Le Clercq v. Michael (1948) 88 Cal.App.2d 700, 702.)

The trial court’s implied finding that the Tribe did not 

delay in rescinding the agreement is supported by substantial 

evidence. There was no evidence that an independent lawyer 

explained the consequences of the SMDC agreement to the Tribe 

prior to litigation, including Stein’s conflict of interest and that

federal recognition was incompatible with the SMDC agreement,

because SMDC’s interest would be invalidated. There is no 

evidence that the Tribe delayed rescission of the SMDC 

agreement once the Tribe understood the basis for rescission. 

Resolutions prepared by Stein, or by attorneys under Stein’s close 

direction, adopting and ratifying amendments to the SMDC 

agreement were no substitute for a meaningful opportunity to 

obtain the advice of an independent attorney about the 

consequences of the agreement. Substantial evidence supports 

the trial court’s conclusion that the Tribe did not delay in seeking 

rescission.
52

D. Unjust Enrichment

Stein further contends that by rescinding the SMDC 

agreement and denying any measure of compensation to Stein, 

the Tribe was unjustly enriched. The trial court found, however, 

that Stein failed to introduce credible evidence necessary to 

recover compensation. Stein’s documentation for his quantum 

meruit claim was heavily redacted and simply totaled hours that 

he claimed to have worked on behalf of the Tribe. The trial court 

concluded the documentation did not represent work that Stein 

performed solely on behalf of the Tribe and for which he would be 

entitled to compensation under the SMDC agreement. On 

appeal, Stein failed to address the trial court’s express findings 

and instead based his argument for compensation on the same 

quantum meruit documentation that the trial court rejected 

below. No error has been shown.

Fraud

Stein and SMDC contend the trial court’s finding that they 

are liable for damages caused by a series of fraudulent acts 

designed to deceive the Tribe is not supported by substantial 

evidence. We disagree. 

A. Misrepresentations

The elements of fraud are: a misrepresentation (false 

representation, concealment, or nondisclosure); knowledge that 

the misrepresentation is false; intent to induce reliance on the 

misrepresentation; justifiable reliance; and damages as a result 
53

of the misrepresentation. (Cohen v. Kabbalah Centre Internat., 

Inc (2019) 35 Cal.App.5th 13, 20; Small v. Fritz Companies, Inc.

(2003) 30 Cal.4th 167, 173.)

The trial court identified a series of misrepresentations 

Stein made in as part of a scheme to defraud the Tribe and usurp 

its rights. For example, Stein represented that exhibit B to the 

Libra agreement was gaming legislation drafted by the office of a 

California State Senator. Stein knew this representation was 

false, because he created the draft, which had never been 

introduced as legislation on behalf of the Tribe. He intended the 

parties to the Libra agreement to rely on his representation that 

Senator Vincent had authored the legislation. The Tribe was 

justified in relying on Stein’s representation, because although 

the draft attached to the Libra agreement was incomplete, it 

showed that legislation had been introduced and amended 

previously. There was no indication that prior versions of the 

legislation did not relate to the Tribe. As a result of Stein’s 

misrepresentation that exhibit B was legislation authored and 

supported by a State Senator, the Tribe entered into an 

agreement that provided Libra with substantial revenue rights in 

exchange for investment funding, and the Tribe agreed to 

conditions in the Libra agreement that required enactment of 

exhibit B or similar legislation.

In addition, Stein misrepresented in the Libra agreement 

that the Tribe was a “state recognized” Indian tribe. Stein knew 

his representation was false, but the Tribe justifiably relied on 

Stein’s counsel and expertise. Based on Stein’s 

misrepresentation, the Tribe provided revenue rights to Libra in 

exchange for funding that was conditioned on the fact that the 

Tribe had been and continued to be recognized by the State of 
54

California as an Indian tribe. Stein’s misrepresentations about 

state recognition damaged the Tribe by diverting resources from 

the effort to attain federal recognition.

Stein made additional false representations when he sent 

letters accusing Tribal Council members of malfeasance and 

registered an unincorporated association in the name of the 

Tribe, creating confusion that hindered the Tribe’s ability to 

conduct its affairs with tribe members, Libra, the court, and the 

public. Stein was aware that the Candelaria Group did not 

control the Tribe’s rights and obligations, but he intended to 

deceive tribe members and others in order to assert control of the 

Tribe’s rights. Tribe members reasonably relied on his false 

representations. Ultimately, a jury trial was required to resolve 

the identity issues that Stein created. The trial court’s 

conclusion that the Tribe was damaged because the Libra 

investors declined to provide further funding as a result of Stein’s 

false representations about the identity and actions of the Tribe, 

was supported by substantial evidence.

B. Lost Funding

Stein and SMDC contend that the Tribe was not damaged 

by Stein’s fraudulent acts, because additional Libra funding was 

contingent on conditions that the Tribe did not and could not 

fulfill. We conclude substantial evidence supports the trial 

court’s finding that the Tribe would have received additional 

investment funding in the absence of Stein’s fraudulent actions. 

In addition, Stein contends the Tribe failed to show it could have 
55

built a profitable casino, but no damages were awarded for lost 

profits. 

“ ‘There are two measures of damages for fraud: out of

pocket and benefit of the bargain. [Citation.] The “out-of-pocket”

measure of damages “is directed to restoring the plaintiff to the 

financial position enjoyed by him prior to the fraudulent 

transaction, and thus awards the difference in actual value at the 

time of the transaction between what the plaintiff gave and what 

he received. The ‘benefit-of-the-bargain’ measure, on the other 

hand, is concerned with satisfying the expectancy interest of the 

defrauded plaintiff by putting him in the position he would have 

enjoyed if the false representation relied upon had been true; it 

awards the difference in value between what the plaintiff 

actually received and what he was fraudulently led to believe he 

would receive.” ’ (Alliance Mortgage Co. v. Rothwell (1995) 10 

Cal.4th 1226, 1240 (Alliance Mortgage); see Lazar v. Superior 

Court (1996) 12 Cal.4th 631, 646 [‘Because of the extra measure 

of blameworthiness inherent in fraud, and because in fraud cases 

we are not concerned about the need for “predictability about the 

cost of contractual relationships” [citation], fraud plaintiffs may 

recover “out-of-pocket” damages in addition to benefit-of-thebargain damages.’].)” (Moore v. Teed (2020) 48 Cal.App.5th 280, 

287–288 (Moore).)

“Alliance Mortgage and other authorities have recognized 

that where the defrauding party stands in a fiduciary 

relationship with the victim of fraud, a ‘broader’ measure of 

damages may be awarded than simply ‘out-of-pocket’ losses.” 

(Moore, supra, 48 Cal.App.5th at p. 289.) “Under Civil Code 

section 1709, a defendant who willfully deceives a plaintiff with 

the intent to induce him to alter his position to his detriment ‘is 
56

liable for any damage which he thereby suffers.’ Civil Code 

section 3333, the general tort damage measure, provides that the 

‘measure of damages . . . is the amount which will compensate for 

all the detriment proximately caused thereby, whether it could 

have been anticipated or not.’ ” (Ibid.)

“ ‘Whatever its measure in a given case, it is fundamental 

that “damages which are speculative, remote, imaginary, 

contingent, or merely possible cannot serve as a legal basis for 

recovery. [Citations.]” [Citations.] However, recovery is allowed 

if claimed benefits are reasonably certain to have been realized 

but for the wrongful act of the opposing party.’ ” (Moore, supra, 

48 Cal.App.5th at p. 292.)

In this case, Libra agreed to provide funding in exchange 

for an interest in the Tribe’s future gaming revenue, and $19 

million remained to be received by the Tribe. The amount stated 

in the contract was not speculative or imaginary. Stein and 

SMDC contend that Stein’s fraud did not prevent the Tribe from 

receiving additional funds, because funding was contingent on 

conditions that the Tribe did not and could not fulfill. Stein 

cannot, however, defeat the Tribe’s claim for damages by relying 

on conditions included in the agreement as a result of his fraud, 

including the failure to pass legislation substantially similar to 

exhibit B, or conditions that his fraud prevented the Tribe from 

fulfilling, such as the dispute he created over control of the Tribe. 

Stein and SMDC have not identified any condition outside of 

those related to Stein’s misrepresentations that independently 

prevented the Tribe from receiving further funding under the 

Libra agreement.

In addition, substantial evidence supports the trial court’s 

finding that the Tribe would have received the additional funding 
57

set forth in the Libra agreement, because either the conditions 

listed in the agreement were not prerequisite to further funding,

or Libra impliedly waived the conditions. The parties’

communications with Libra in the summer of 2006 show that the 

passage of successful legislation and the other conditions listed in 

the Libra agreement were not required to be met before Libra 

would provide further funding to the Tribe. Stein was aware that 

Senator Vincent refused to introduce legislation on behalf of the 

Tribe and no legislation had been passed, but he worked with 

Libra and the Tribe to submit a request for the next tranche of 

funding in September 2006. Legislation was introduced by a 

different legislator and the legislative process continued. On 

September 26, 2006, Stein stated that disputes over the Tribe’s 

expenditures endangered the next $2.5 million in funding from 

Libra, which hung in the balance. In other words, Stein did not 

believe that any prerequisite condition in the Libra agreement 

prevented the Tribe from receiving additional funding other than 

the dispute that he created over the use of the funds. Several 

conditions in the Libra agreement had not been met when the 

Libra representatives completed revisions to the Tribe’s request 

for further funding. When the Tribe met with Libra in 

September 2006, Libra assured the Tribe that despite Stein’s 

statements, there were no problems with the Tribe’s actions as 

long as the Tribe followed the contract. From these 

communications, we conclude that none of the parties considered 

the Tribe’s expenditures, the failure to pass legislation, or any 

other condition stated in the Libra agreement to be an obstacle to 

the receipt of further investment funds. Either Libra never

considered the contract conditions to be prerequisites to further 

funding, or Libra impliedly waived compliance with the 
58

conditions. When Stein created confusion about control of the 

Tribe, Libra reasonably relied on Stein’s false representations to 

decline to provide further funding until the disputes were 

resolved. The limited term of the Libra agreement expired before 

the disputes were resolved. Stein and SMDC’s fraudulent acts 

directly caused Libra to decline to provide further funding to the 

Tribe. The Tribe was entitled to recover the amount of the Libra 

agreement under the measure of damages for fraud.

Stein further contends that in order to establish damages 

from the loss of the Libra investment, the Tribe had to show that 

it would have been able to build a casino and that the casino 

would have been profitable. This is incorrect. The Tribe provided 

valuable revenue rights to Libra in exchange for investment 

funding, which was not dependent on the Tribe constructing a 

profitable casino and which did not require the Tribe to 

reimburse funds if a casino were not built. The Tribe was 

entitled to recover the amount of the Libra investment that they 

did not receive as a result of Stein’s fraudulent acts. No amount 

was awarded as lost profits of the planned casino operation.

The compensatory damages based on the lost investment funding 

were not too speculative.

Calculation of Compensatory Damages

Stein contends the compensatory damages award of 

$20,411,067.23 is not supported by substantial evidence. The 

Tribe concedes in its respondent’s brief that the statement of 

decision erroneously described the calculation of damages based 

on the full amount of the Libra investment of $21,000,000, minus 

$800,000 received from Libra, $161,067.23 paid by the Tribe to 
59

SMDC, and $50,000 paid Crane. We conclude the amount of 

compensatory damages must be reduced to reflect the evidence of 

damages at trial.

The undisputed evidence established that the Tribe 

received the initial round of investment funding provided under 

the Libra agreement, and the trial court found that Stein’s 

fraudulent actions prevented the Tribe from receiving the 

remaining anticipated funding totaling $19 million. Further 

evidence showed the Tribe paid $161,067.23 to SMDC under the 

SMDC agreement that the Tribe was entitled to recover based on 

rescission of the SMDC agreement. No basis has been provided 

on appeal, however, for including the Tribe’s payment of $50,000 

to Crane in the damages calculation. The Tribe did not bring an 

action against Crane, and Crane was not an alter ego of Stein. 

Although the trial court found Stein was liable for breach of 

fiduciary duty, no argument has been made on appeal that Stein 

was required to reimburse the Tribe for the payment made to 

Crane. The amount of compensatory damages awarded in the 

judgment must be reduced to $19,161.067.23, the total amount of 

compensatory damages supported by the evidence.

Punitive Damages

Stein and SMDC contend that the award of punitive 

damages is not supported by evidence of Stein’s net worth. We 

conclude no error has been shown.
60

A. Additional Facts

The trial court scheduled the punitive damages phase to 

begin on December 10, 2018. The court assumed that the Tribe 

requested financial documents prior to trial, so ordered Stein, the 

Law Offices, and SMDC to disclose financial records to the Tribe 

no later than November 15, 2018. The court ordered the parties 

to appear for the trial, as well as the accountants for Stein, the 

Law Offices, and SMDC.

Stein obtained new counsel. In response to the court’s 

order, Stein produced bank records for one account and two credit 

cards for the year 2018. He submitted a statement to the court 

that he would not appear for the punitive damages phase due to 

his medical condition, and he waived his right to appear 

personally for the remainder of the trial, but he offered to 

respond to written questions under oath. 

On December 10, 2018, the Tribe objected that Stein failed 

to comply with the court’s order to disclose financial records. For 

example, no records of his real property assets had been provided. 

Stein’s attorney argued that the Tribe failed to take the steps 

necessary to prepare for the punitive damages phase of trial. The 

Tribe had not filed and served a notice to appear asking for 

specific records relevant to the punitive damages phase of trial. 

The attorney argued that the court’s order to produce financial 

records was also vague. Financial records were bank statements 

or brokerage statements. Judgments obtained by the Law Offices 

and property deeds were not financial records. The Tribe argued 

that the court’s order to produce information made it was 

incumbent on the parties to meet and confer to fulfill the order. 

Stein’s attorney offered to provide further discovery. The trial 
61

court allowed the Tribe to request production of 15 categories of 

documents and to propound 50 questions for Stein to answer in 

writing. 

Trial on the issue of punitive damages began on April 5, 

2019. The Tribe requested a punitive damages award of $10 

million. In discovery responses, Stein claimed to own one percent 

of a single property in Santa Barbara. Stein provided verified 

responses to discovery under penalty of perjury that he had never 

had an ownership interest in a property on Ashland Avenue in 

Santa Monica, which was held in his wife’s name. The Tribe 

argued, however, that Stein had significant property holdings in 

his own name in California. The Tribe asked the court to take 

judicial notice of the fact that Stein owned three real properties 

in California, despite his representations in discovery. An 

interspousal transfer deed Stein provided in discovery showed he 

transferred his interest in the Ashland Avenue property to his 

wife on May 7, 2012, during the pendency of the litigation. Stein 

and his wife were listed as joint owners of real property on 

Murrell Road in Santa Barbara, an address that Stein listed for 

himself at one point during litigation, with an assessed value of 

$1 million. In addition, Stein and his wife acquired another 

property in Santa Barbara on January 7, 2019. The purchase 

price was $830,000, and the mortgage for the property was 

$580,000. 

The Tribe’s attorney noted that when Stein apologized to 

the court on January 22, 2016, for being underprepared, his 

excuse was that he was managing a seven-figure transaction as 

part of overseeing the American branch of his father-in-law’s 

business, as well as negotiating a seven-figure settlement in a 

case in New Orleans. In addition, Stein had filed an action 
62

against a former client for $400,000 in unpaid fees. The client’s 

cross-complaint had alleged payment of $750,000 to Stein. A 

2017 notice of settlement in the fees case included a 

confidentiality provision, which prevented the Tribe from 

learning additional information. The Tribe inferred from the 

numbers alleged in the pleadings that Stein earned 

approximately $1 million in a single year from one client. The 

Tribe noted that Stein had not described any income from his 

father-in-law’s Chinese companies and Chinese assets in 

America. He also had not provided any responses about the 

settlement of litigation in New Orleans. The Tribe argued that 

the court could reasonably infer Stein’s annual income was $2 

million or $3 million per year. 

Stein’s attorney responded that the Tribe’s evidence 

amounted to speculation, rather than evidence of net worth. 

Assets owned by Stein’s family members were not evidence of 

Stein’s net worth. Having a case that generated a large 

settlement or managing another person’s assets did not cause the

assets to belong to the attorney. The Tribe had not even shown 

that Stein had the ability to pay the judgment of approximately 

$20 million that had been ordered. The records provided in 

discovery showed Stein’s income was $750,000 in some years and 

far less after expenses and taxes in other years. 

B. Statement of Decision

In the statement of decision, the trial court found by clear 

and convincing evidence that Stein’s conduct, individually and 

through his alter ego SMDC and his law office, was fraudulent, 

despicable, oppressive, and malicious. His fraud against the 
63

Tribe began from the inception of the relationship. He told the 

Tribal Council that attorney Otto would serve as their general 

counsel to advise them on the SMDC agreement after Otto 

expressly told Stein that he would not serve in that role. The 

fraud continued when Stein gave the Tribe advice that they were 

a state recognized tribe, and that their status could give them the 

right to engage in gaming in California without federal 

recognition. The fraud continued after the relationship ended 

and litigation started, when Stein took the Tribe’s identity using 

their membership records, registered a different group under 

their name, and tried to settle the instant lawsuit. Evidence of 

fraud was extensive and at the center of the case. 

The court also found Stein engaged in oppressive and 

malicious conduct. Stein located the Tribe’s offices in his law 

office and gave his legal assistant the job of Tribal Administrator 

in order to control the Tribe’s legal and financial affairs. Among 

Stein’s worst actions was his failure to return the Tribe’s original 

birth and family records after he resigned and was fired. By 

keeping the records, he prevented the Tribe from pursuing 

federal recognition, which was a 25-to-30-year process. Nearly 15 

to 20 years later, Stein had still not returned the records. 

Stein was a recidivist, as he targeted other Native 

American groups to prey upon. Repeated actions may be 

punished more severely than isolated incidents. He also used his 

status as a lawyer in a position of trust as a weapon against a 

less sophisticated client, and used litigation as a weapon against 

the Morales Group and the Tribe. 

During the punitive damages phase, Stein failed to provide 

evidence of his assets and failed to be candid about his assets 

under oath. He provided little evidence of his net worth. Stein 
64

refused to take the stand or appear on April 5, 2019, to answer 

questions regarding his financial condition, so the Tribe had no 

meaningful opportunity to cross-examine him on this topic. He 

presented only a chart to illustrate his net worth, which had no 

supporting information and was unreliable. Relying on other 

information in the record, the court found Stein had ample ability 

to pay a multi-million dollar judgment. On the record on July 22, 

2016, Stein represented that he was involved in several “seven 

figure” transactions and settlements, including substantial 

transactions that Stein handled for his father-in-law’s office in 

China and settlements in legal matters. In discovery responses 

during the punitive damages phase, Stein failed to describe the 

income received from his father-in-law, Chinese assets in 

America, or any of the very high net value matters that he was 

engaged in that he had described to the court on the record on 

July 22, 2016. The court considered his prior statements and 

concluded Stein was untruthful about his ability to pay a 

judgment or punitive damages. 

The court placed a value on the holdings that Stein 

previously mentioned equal to $3 million. Stein’s family had 

substantial real estate holdings as well. Stein had significant 

property holdings in California in his own name, which showed 

his discovery responses had been less than candid. Stein 

transferred ownership of a property in Santa Monica to his wife 

on May 7, 2012, during the pendency of the litigation. He and his 

wife were listed as joint owners of property in Santa Barbara 

assessed at $1 million. Stein stated the properties were largely 

in his wife’s name or belonged to his wife’s family, but he lived at 

the properties and did not report any rent. Stein had been 

undeterred from his lawless behavior, evasiveness, and 
65

untruthfulness to opposing parties and the court. He was not 

sorry or contrite, had no misgivings about anything that 

occurred, refused to change his conduct, and was undeterred. 

The court found a $7 million punitive damages award was 

appropriate, which was a third of the compensatory damages 

awarded. 

C. Applicable Law

Punitive damages are recoverable in fraud actions 

involving intentional misrepresentations. (Alliance Mortgage, 

supra, 10 Cal.4th at p. 1241.) The United States Supreme Court 

has developed “a set of substantive guideposts that reviewing 

courts must consider in evaluating the size of punitive damages 

awards: ‘(1) the degree of reprehensibility of the defendant’s 

misconduct; (2) the disparity between the actual or potential 

harm suffered by the plaintiff and the punitive damages award; 

and (3) the difference between the punitive damages awarded by 

the jury and the civil penalties authorized or imposed in 

comparable cases.’ [Citation.] A trial court conducts this inquiry 

in the first instance; its application of the factors is subject to de 

novo review on appeal.” (Nickerson v. Stonebridge Life Ins. 

Co. (2016) 63 Cal.4th 363, 371–372.)

“ ‘Evidence of a defendant’s financial condition is a legal 

precondition to the award of punitive damages. [Citation.] We 

examine the record to determine whether the challenged award 

rests upon substantial evidence. [Citations.] If it does not, and if 

the plaintiffs had a full and fair opportunity to make the 

requisite showing, the proper remedy is to reverse the award.’ ” 
66

(Farmers & Merchants Trust Co. v. Vanetik (2019) 33 Cal.App.5th 

638, 647–648.)

“The ultimately proper level of punitive damages is an 

amount not so low that the defendant can absorb it with little or 

no discomfort [citation], nor so high that it destroys, annihilates, 

or cripples the defendant.” (Rufo v. Simpson (2001) 86 

Cal.App.4th 573, 621–622.)

“ ‘[I]f a plaintiff is unable to provide the court with evidence 

due to the defendant’s failure to comply with discovery 

obligations, then punitive damages may be awarded without the 

requisite evidence.’ ” (Farmers & Merchants Trust Co. v. Vanetik, 

supra, 33 Cal.App.5th at p. 650.) “In Mike Davidov Co. v. 

Issod (2000) 78 Cal.App.4th 597, the appellate court held that a 

trial court may permit the discovery of a defendant’s financial 

condition after liability has been determined, even if the plaintiff 

did not file a motion for pretrial discovery of financial condition.

[Citation.] After the trial court ruled in favor of the plaintiff in a 

bench trial, it ordered the defendant to bring records regarding 

his net worth to the court the next day. [Citation.] The 

defendant failed to do so, and the trial court awarded punitive 

damages to the plaintiff using a multiplier of the compensatory 

damages. [Citation.] ‘So long as the trial court allows the 

defendant sufficient time, following a determination of liability, 

to collect his or her financial records for presentation on the issue 

of the amount of such damages to be awarded, there is nothing 

prejudicial or unfair about using such a process to try the issue of 

the amount of punitive damages.’ ” (Farmers & Merchants Trust 

Co., at p. 651.)
67

D. Analysis

Stein and SMDC contend in a single sentence in their 

opening brief that the conduct at issue was not reprehensible and 

the Tribe did not suffer damages. The trial court found the 

conduct was reprehensible, however, because among other 

conduct, Stein withheld the Tribe’s original records and was a 

recidivist who repeatedly targeted Native American groups. As 

discussed above, substantial evidence supports the trial court’s 

finding that the Tribe was damaged. 

Stein and SMDC’s primary challenge to punitive damages 

is their contention that the amount of the award was excessive 

and not supported by evidence of Stein’s net worth. The trial 

court concluded the evidence that Stein and SMDC provided to 

the Tribe in discovery about Stein’s financial condition was not 

credible. Although insufficient credible, admissible evidence was 

presented about the current financial condition of Stein, Law 

Offices, and SMDC, the trial court found Stein and SMDC were 

estopped from complaining about the absence of evidence because 

they failed to produce credible evidence of their finances. Stein 

had not provided evidence of any compensation for the significant 

work that he represented he performed to manage the American 

branch of his father-in-law’s Chinese company. He transferred 

substantial assets to his wife’s name during the pendency of the 

litigation, and the amount of punitive damages assessed was 

reasonably related to the amount of compensatory damages. 

Stein chose not to appear and testify during the punitive 

damages phase of the trial, which could have provided clarity 

about the missing information. The trial court did not abuse its 
68

discretion in finding that Stein and SMDC were estopped from 

objecting to the lack of evidence of net worth.

Conversion and Remaining Theories

Stein and SMDC contend that the trial court’s findings on 

conversion are not supported by substantial evidence, because 

the Tribe was not deprived of any documents. Stein and SMDC 

simply rely on their own evidence, however, contrary to the 

standard of review on appeal. The trial court found Stein and 

SMDC withheld records that should have been returned to the 

Tribe, and substantial evidence supports the trial court’s finding. 

Stein withheld and used the Tribe’s records to contact tribe 

members directly, without the Tribe’s authorization. No error 

has been shown as to the finding of conversion.

Because the remedies provided to the Tribe in the 

judgment are fully supported by the trial court’s findings on the 

claims for rescission, fraud, and conversion, we need not consider 

whether the same remedies were equally supported under other 

theories of recovery. 

Dismissal of SMDC Complaint and Cross-complaint

Stein and SMDC contend that the trial court incorrectly 

concluded SMDC dismissed claims against the Tribe from its 

complaint, and Stein and SMDC dismissed claims against the 

Tribe from the September 2007 cross-complaint. We agree with 

the trial court that the claims alleged against the Tribe were 

dismissed from both the SMDC complaint and the September

2007 cross-complaint. 
69

When Stein and SMDC filed their pleadings, they were 

aware of the identity of the party that they intended to name as a 

defendant. As their pleadings acknowledged, that party had been 

referred to at different times during the parties interactions as 

the Gabrielino-Tongva Nation or the Gabrielino-Tongva Tribe. 

The SMDC agreement that Stein drafted in 2001 referred to the 

contracting party as the “Gabrielino-Tongva Nation,” but the 

resolutions adopting the agreement and subsequent amendments 

to the agreement were executed on behalf of the “GabrielinoTongva Tribe.” SMDC’s complaint was brought against the 

“Gabrielino-Tongva Tribe,” but its amended complaint named the 

“Gabrielino/Tongva Nation, also known as Gabrielino-Tongva 

Tribe, also known as Gabrielino Tribal Gaming Authority.” The 

September 2007 cross-complaint was brought against the 

“Gabrielino/Tongva Nation, formerly known as GabrielinoTongva Tribe, formerly known as Gabrielino Tribal Gaming 

Authority.”

Stein and SMDC were aware that the elected Tribal 

Council members executed resolutions adopting amendments to 

the SMDC agreement, terminated Stein, and caused the Tribe to 

file litigation against Stein and SMDC. After litigation 

commenced, Stein and SMDC entered into a settlement 

agreement with a different group of tribe members. Stein and 

SMDC chose to file notices dismissing all their claims against the 

entity named in their pleadings as “Gabrielino-Tongva Tribe” 

without any qualification or limitation. The jury’s finding that 

the Tribe had standing to litigate the claims in the Tribe’s 

complaint did not restore claims that Stein and SMDC dismissed 

from their pleadings. SMDC’s substitution of “Gabrielino/Tongva 

Nation” for a Doe defendant during the course of litigation was 
70

not effective to refer to the Tribe, because the Tribe was already a 

named defendant in the litigation.

We note that the trial court allowed Stein and SMDC to 

present their claims at trial. After a full trial on the merits, the 

trial court not only found the claims against the Tribe had been 

dismissed, but that their claims failed on the merits as well. 

Stein and SMDC contend that the trial court failed to rule on

indemnity claims in the cross-complaint against the individual 

defendants. However, the trial court expressly listed the 

September 2007 cross-complaint as a pleading for determination 

at trial, and found against Stein and SMDC on the claims in the 

cross-complaint against the individual defendants. Stein and 

SMDC have not met their burden on appeal to show error as to 

any claim against the individual defendants that was presented 

to the trial court for determination.

Dismissal of Crane Complaint

Crane similarly contends that it did not dismiss claims 

against the Tribe, but only dismissed the Candelaria Group. This 

is incorrect. Crane filed an action against the “Gabrielino-Tongva 

Tribe”, and individual defendants based on the Crane agreement. 

The named defendant in Crane’s lawsuit was the contracting 

party, and Crane subsequently dismissed all claims against 

“Gabrielino-Tongva Tribe.” At the time that Crane filed its 

dismissal, Crane was aware competing groups claimed authority 

to act for the Tribe, but Crane did not qualify or limit its 

dismissal. The Candelaria Group was not a party to the Crane 

agreement and was not named as a defendant in Crane’s lawsuit. 
71

Crane asserts that two earlier unpublished opinions in this 

case establish as law of the case that the Tribe split into two 

groups. This is incorrect. Both opinions expressly found triable 

issues of material fact required the appellate court to reverse 

summary judgments; neither case affirmed a finding of fact made 

by the trial court. After further proceedings in the trial court, the 

jury found that the Tribe had standing and the capacity to sue.

The jury’s finding did not affect Crane’s dismissal of claims 

against the Tribe.

Although the trial court ultimately found Crane’s claims 

against the Tribe had been dismissed, Crane was permitted to 

present its claims at trial. The court found against Crane on the 

merits as well. The Crane agreement provided for monthly fees 

to accrue “until such time as the Tribe secures an Investor for the 

proposed casino and gaming establishment and receives payment 

of at [least] $2 million. Once an investor has been secured and 

the $2 million has been paid, the Tribe will pay [Crane] all 

previous monthly fees accrued and the subsequent monthly fees 

on a monthly basis” until a specific date. The trial court found 

the payment term of the Crane agreement was not triggered, 

because the Tribe did not receive $2 million in investment 

funding. The evidence supported finding that the Tribe received 

less than $2 million from the first tranche of investment fundings 

and no further funding. 

To the extent the provisions of the Crane agreement were

ambiguous, the trial court’s finding that payment was required

when the Tribe received funding of $2 million was supported by 

substantial evidence. Crane contends that by making a partial 

payment of $50,000, the Tribe waived its right to rely on the 

condition necessary for the remaining payments, but the evidence 
72

showed that Stein unilaterally paid the funds to Crane on behalf 

of the Tribe. There was no evidence of waiver by the Tribe of the 

prerequisite conditions to payment.

The trial court’s finding that Crane failed to provide proof

necessary to recover on claims for quantum meruit or account 

stated were also supported by substantial evidence. Crane 

admitted that the firm did not keep the type of time records 

necessary to establish a quantum meruit claim. He did not 

attempt to reconstruct the time spent to support the claims.

Crane’s claims remaining for trial were against the 

individual defendants for intentional and negligent interference 

with contract, and fraudulent conveyance. The trial court found 

in favor of Carmelo, Alcala, Perez, Machado, Loya, Dunlap, 

Aronson, and Polanco as to the causes of action remaining on the 

Crane complaint. On appeal, Crane has not identified any error 

with respect to the claims alleged against the individual

defendants.

Attorney Fees Award

In a consolidated appeal, Stein, SMDC, and Crane appeal 

from a postjudgment order awarding attorney fees to the Tribe. 

We conclude that no error has been shown.

A. Additional Facts and Procedural History

In December 2019, the Tribe filed a motion for attorney fees 

and costs, seeking attorney fees of $2,148,428.74 and costs of 

$103,637.93 from Stein, SMDC, and Crane, jointly and severally. 

In opposition to the motion for attorney fees and costs, Crane, 
73

Stein, and SMDC argued that the Tribe was not the prevailing 

party for purposes of an award of attorney fees under Civil Code 

section 1717, subdivision (b)(2), because the claims against the 

Tribe were voluntarily dismissed. The Tribe replied that 

although the claims against the Tribe had been dismissed, Crane, 

Stein, and SMDC prosecuted the claims through trial, and the 

court adjudicated the claims in favor of the Tribe. On 

September 15, 2020, the trial court entered an order awarding 

attorney fees of $469,427.50 against Stein and SMDC, and 

attorney fees of $11,900 against Crane. The request for costs was 

denied.

B. Reduction in Compensatory Damages

Stein, SMDC, and Crane contend that if the judgment is 

reversed on the merits, the postjudgment order awarding 

attorney fees must be reversed as well. Although we have 

concluded above that the amount of compensatory damages must 

be reduced and the punitive damages eliminated, this 

modification does not affect the determination that the Tribe was 

the prevailing party in the underlying action for the purposes of 

the attorney fees provisions of the parties’ contracts.

C. Dismissal of Claims

Stein, SMDC, and Crane contend that the trial court 

incorrectly found that they dismissed their claims against the 

Tribe. As discussed above, however, the trial court’s finding that

Stein, SMDC, and Crane dismissed their claims against the Tribe

is supported by substantial evidence.
74

They further contend that the claims in the cross-complaint 

were not adjudicated against the individual defendants, but as 

stated above, the claims in the cross-complaint that were 

presented at trial for determination were fully adjudicated in 

favor of the individual defendants.

For the first time on appeal from the postjudgment order 

awarding attorney fees, Stein, SMDC and Crane contend that the 

Tribe was judicially estopped from arguing that claims against 

the Tribe were dismissed. They failed to raise this contention on 

appeal from the judgment and cannot raise it for the first time in 

connection with the postjudgment order. (See City of Los Angeles 

v. Metropolitan Water Dist. of Southern California (2019) 42 

Cal.App.5th 290, 310 [party who failed to appeal from trial 

court’s substantive ruling on standing cannot attempt to raise 

same fact-dependent arguments in appeal from postjudgment 

order awarding attorney fees].) We note, however, that the Tribe 

consistently argued in the trial court that the claims against the 

Tribe had been dismissed and the only claims pending for trial 

were those brought by the Tribe.

We also note that Stein, SMDC, and Crane have not raised 

any argument on appeal that they are not liable for attorney fees 

under Civil Code section 1717, subdivision (b)(2), because they 

voluntarily dismissed their claims against the Tribe. Although 

the claims were dismissed, Stein, SMDC, and Crane successfully 

argued in the trial court that the identity of the party that they 

dismissed, as well as the merits of their claims against the Tribe, 

were issues for trial.
75

D. Alter Ego

The appellants contend Stein is not liable for attorney fees 

assessed against SMDC, but the trial court’s judgment in this 

case found Stein to be the alter ego of SMDC. Stein did not 

challenge the alter ego finding in his appeal from the judgment, 

which the Tribe expressly stated in the respondent’s brief in 

connection with that appeal. After failing to raise his factdependent arguments about the trial court’s alter ego finding on 

appeal from the judgment, Stein cannot attempt to raise his 

contentions in the appeal from the postjudgment order awarding 

attorney fees. (See City of Los Angeles v. Metropolitan Water 

Dist. of Southern California, supra, 42 Cal.App.5th at p. 310.) 

There was substantial evidence that SMDC operated as Stein’s 

alter ego as well.

Disentitlement Doctrine

The Tribe filed a motion with this appellate court seeking 

to dismiss the appeals brought by Stein and SMDC under the 

disentitlement doctrine based on Stein’s actions in cases in other 

courts. We decline to exercise our discretion to dismiss the 

appeals.

“Under the disentitlement doctrine, a reviewing court has 

inherent power to dismiss an appeal when the appealing party 

has refused to comply with the orders of the trial court. 

[Citation.] ‘ “Appellate disentitlement ‘is not a jurisdictional

doctrine, but a discretionary tool that may be applied when the 

balance of the equitable concerns make it a proper sanction.’ 

[Citation.]” [Citation.]’ [Citation.] The rule applies even if there 
76

is no formal adjudication of contempt. [Citation.] The

disentitlement doctrine ‘is particularly likely to be invoked where 

the appeal arises out of the very order (or orders) the party has 

disobeyed.’ [Citation.] Moreover, the merits of the appeal are 

irrelevant to the application of the doctrine.” (Ironridge Global 

IV, Ltd. v. ScripsAmerica, Inc. (2015) 238 Cal.App.4th 259, 265.)

“ ‘The power to dismiss an appeal for refusal to comply with 

a trial court order has been exercised in a variety of 

circumstances, including: where a parent had taken and kept 

children out of the state in violation of a divorce decree 

[citations]; where a husband had failed to pay alimony as ordered 

in an interlocutory judgment of divorce [citation]; where a party 

in a civil action was a fugitive from justice and in contempt of the 

superior court for failure to appear on criminal charges after 

being released on bail [citation]; and where defendants willfully 

failed to comply with trial court orders regarding a receivership. 

[Citation.] Moreover, the inherent power to dismiss an appeal 

has been exercised in several cases where a party failed or 

refused to appear for a judgment debtor examination.’ ” 

(Ironridge Global IV, Ltd. v. ScripsAmerica, Inc., supra, 238 

Cal.App.4th at pp. 265–266.)

Courts do not apply the disentitlement doctrine lightly, 

thus depriving an appellant of the right to appeal. (Findleton v. 

Coyote Valley Band of Pomo Indians (2021) 69 Cal.App.5th 736, 

756–757.) We decline to apply the disentitlement doctrine in this 

case, having decided instead to consider the issues on the merits. 

Therefore, the Tribe’s motion to dismiss the appeals brought by 

Stein and SMDC based on the disentitlement doctrine is denied.
77

DISPOSITION

The judgment is modified to reduce the amount of 

compensatory damages awarded from $20,411,067.23 to 

$19,161,067.23. The judgment, as modified, and the 

postjudgment order awarding attorney fees are affirmed. 

Respondent Gabrielino-Tongva Tribe is awarded its costs on 

appeal.

NOT TO BE PUBLISHED.

MOOR, J.

We concur:

RUBIN, P. J.

KIM, J.