Court Opinion

ID: 9929065
Source: CourtListenerOpinion
Date Created: 2024-02-01 18:03:21.610809+00
Date Added: 2024-06-11T10:05:56.289778
License: Public Domain

Filed 2/1/24 Karma Capital v. Nakhleh CA4/1
                 NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
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                COURT OF APPEAL, FOURTH APPELLATE DISTRICT

                                                 DIVISION ONE

                                         STATE OF CALIFORNIA

 KARMA CAPITAL, INC. et al,                                           D080588

           Plaintiffs and Appellants,

           v.                                                         (Super. Ct. No. 37-2021-
                                                                      00001088-CU-FR-CTL)
 ELIAS NAKHLEH et al.

           Defendants and Respondents.

         APPEAL from an order of the Superior Court of San Diego County,
Katherine A. Bacal, Judge. Affirmed.
         Mirch Law Firm, Kevin Mirch, and Marie C. Mirch, for Plaintiffs and
Appellants.
         Gordon Rees Scully Mansukhani, Matthew G. Kleiner, and Andrea K.
Williams, for Defendants and Respondents.

         Karma Capital, Inc. (Karma), Marcus Gates, and Trisha Gates (Karma,
Marcus, and Trisha, collectively Appellants) appeal an order granting a
motion to disqualify their counsel, the Mirch Law Firm and its attorneys (the
Mirch Firm) from representing Appellants in their lawsuit against Elite
Restaurant Group, Inc. (Elite), Elias Nakhleh (Elite and Elias, together
Respondents), and others.
      This appeal follows the third time the Mirch Firm has been disqualified
in representing various plaintiffs who allege they were duped by Respondents
and others into purchasing worthless restaurant franchises. Here, the
operative complaint concerns Appellants’ acquisition of eight Daphne’s
restaurants in San Diego County and names Elite, Michael Nakhleh, Elias

Nakhleh, and others as defendants.1 In the other two suits, the Mirch Firm
represented multiple franchisees of the Slater’s 50/50 brand in lawsuits
against Slater’s 50/50 Franchise, LLC (Slater’s) (the franchisor), Elite (its
parent company), and Elias and Michael (the principals for Slater’s and
Elite). Despite the instant matter concerning Daphne’s franchises, the claims
made here are similar to those made in the other two cases.
      The first case was a civil action filed in federal court where the Mirch
Firm was representing franchisee Zia Abhari in a civil action against Elite
and Slater’s (Abhari litigation). In that case, Elite and Slater’s successfully
moved to disqualify the Mirch Firm based on the firm’s communications with
and connections to Martin Reiner. Although Reiner was disbarred by the
State Bar of California in 2017, he nevertheless held himself out to be a
licensed attorney. Abhari referred to Reiner as his “attorney” and
recommended him to Michael to handle a legal issue Slater’s and Elite were
experiencing. Michael hired Reiner and gave him a check for $10,000, which
Michael believed to be an attorney retainer fee. Additionally, Reiner
requested that Michael sign a document to authorize Reiner to represent

1     Because Michael and Elias share the same surname, we will refer to
them by their respective first names to avoid confusion. We do the same for
Marcus and Tricia Gates. In addition, we observe that Michael has not been
served in the instant action.
                                        2
Elite and Slater’s in a trademark infringement lawsuit. Reiner then
proceeded to commence a trademark infringement suit for the “ ‘50/50
Burger’ ” trademark in Los Angeles Superior Court. Whether an attorney-
client relationship was thus formed between Reiner on the one hand and
Elite, Slater’s, and Michael on the other was a contested issue in the Abhari
litigation. Also, the Mirch Firm challenged whether it had acquired any
attorney-client privileged information from Reiner, who appeared with the
Mirch Law Firm at a mediation between the plaintiffs (who included Abhari)
and Slater’s. The district court ultimately answered the two preceding
questions in the affirmative and granted the motion to disqualify the Mirch
Firm. The Ninth Circuit affirmed the order. (See Mirch Law Firm, LLC v.
Nakhleh (9th Cir. May 26, 2022, No. 20-56207) [2022 U.S.App. LEXIS 14564,
at pp. *3–4] (Mirch Law Firm, LLC).)
      In a similar suit filed in Orange County Superior Court wherein the
Mirch Firm represented plaintiffs suing Slater’s, Elite, and Elias (the Slater’s
parties), the trial court granted the Slater’s parties’ motion to disqualify the
Mirch Firm. In doing so, the court found: (1) Elite and Slater’s reasonably
believed they had an attorney-client relationship with Reiner in a trademark
infringement suit; (2) Reiner asked Michael, as a principal of both companies,
to sign a conflict waiver to allow Reiner to pursue another claim against Elite
and Slater’s in another federal action; (3) Reiner took certain actions to
convince others he was a licensed attorney; (4) during a mediation, the Mirch
Firm described Reiner as a “ ‘lawyer with licensing problems’ ”; (5) Michael
disclosed to Reiner sensitive information concerning the business operations,
assets, and proprietary procedures relative to Elite and Slater’s; (6) the
information provided to Reiner was relevant to the plaintiffs’ claims against
the Slater’s parties; and (7) the Mirch Firm received several e-mails from

                                        3
Reiner. Based on these communications, the trial court found that the
Slater’s parties established that Reiner was given privileged information,
which he, in turn, conveyed to the Mirch Firm. And the court concluded that
the plaintiffs did not meet their burden of rebutting the presumption that the
Mirch Firm received privileged information. Our colleagues in Division
Three of the Fourth Appellate District affirmed this order in an unpublished
opinion. (See Ace Foods, LLC v. Slater’s 50/50 Franchise, LLC (Mar. 14,
2023, G061049) [nonpub. opn.] (Ace Foods).)
      In the instant matter, largely based on much of the same evidence
offered in the previous two cases, the trial court granted Respondents’ motion
to disqualify the Mirch Firm. In doing so, the court found Respondents had
shown that the Mirch Firm received confidential information, including
communications between Michael and Reiner. Thus, the court concluded a
rebuttable presumption arose that Reiner disclosed or provided access to
privileged information to the Mirch Firm. Moreover, the court found that the
Mirch Firm had not rebutted this presumption. Although the Mirch Firm
attested that they did not receive any privileged information, the court
determined “the weight of the evidence show[ed] otherwise.”
      Appellants contend the trial court erred in granting the disqualification
motion because: (1) there was no attorney-client relationship between Reiner
and Respondents; (2) even if there was an attorney-client relationship, there
was a joint representation relationship with Abhari and communications
made during the joint representation are not privileged; (3) Respondents
waived the attorney-client privilege when they filed e-mails between Michael
and Reiner as exhibits in its motion to disqualify counsel in the Abhari
litigation; (4) because the attorney-client relationship between Reiner and
Respondents ended in January 2020, the court erred by relying on

                                       4
communication between Reiner and Michael after this date as evidence the
Mirch Firm obtained confidential information; and (5) Respondents failed to
establish the Mirch Firm received any information or documents from Reiner.
We observe these are similar (if not the same) arguments that were advanced
in Ace Foods, supra, G061049. Like Division Three, we also reject each of
Appellants’ contentions and affirm the court’s order.
              FACTUAL AND PROCEDURAL BACKGROUND
      In January 2018, Appellants purchased eight Daphne’s restaurants in
the San Diego area for $1.7 million. Appellants allege that Michael,
Respondents, and others engaged in a scheme to “flip” Daphne’s restaurants,
inflating their value and committing other wrongful acts associated with the

sale of these establishments.2 Therefore, Appellants brought suit alleging
nine causes of action in the operative complaint.
      In 2019, Michael was a principal for Elite. At that time, Elite owned
the trademarks and other intellectual property for the Daphne’s restaurant
franchises as well as the Slater’s 50/50 brand. In June of that year, he had a
meeting with Abhari, who owned two Slater’s franchises in Southern
California. During their meeting, Michael and Abhari discussed “certain
legal issues” Slater’s and Elite were encountering. Abhari recommended
Michael retain his attorney Reiner to represent Elite and Slater’s.
      Michael met privately with Reiner at Abhari’s office outside the
presence of Abhari. During the meeting, Reiner told Michael about his
litigation work on other matters. Reiner informed Michael a $10,000 retainer
fee would be required if Elite and Slater’s wanted to retain his services, and

2    The alleged scheme also involved the sale of Slater’s, Noons, Gigi’s,
Marie Calendar’s, Mimi’s Café, and Patxi’s Pizza franchises.
                                       5
after payment, they would be his client and he could start working on their
trademark infringement lawsuit.
      Reiner gave Michael an Assignment of Claim document for signature
and a cover letter. The header on these documents indicated they were from
“Hill Collections, Inc.” Both documents were signed by Reiner. The
Assignment of Claim stated Michael, as agent for Elite, “hereby assigns to,
and authorizes, Hill Collections, Inc. (‘Assignee’), to do all things legally
necessary for[ ] a claim for trademark infringement, and/or other legal
theories, adverse to Frontiere Natural Meats, LLC, and/or other parties
involved in that infringement, and to obtain and enforce a judgment, or for
other compromise resolution, which in the Assignee’s opinion is satisfactory.”
The Assignment of Claim indicated Hill Collections would retain 30 percent
of the amount collected and the remaining 70 percent would be disbursed to
Michael for Elite. The Assignment of Claim specified a $10,000 “commencing
fee” was “to be paid by the Assignor for all attorney fees, court filing fee costs,
and process serving costs.” Elite was also responsible for other litigation
costs, including depositions and expert fees. The cover letter directed
Michael to pay the “commencement fee” to Reiner personally.
      In the cover letter, Reiner explained the assignment contract capped
attorney fees and court filing fees for pursuing a trademark infringement
claim and advised Michael he would “save a substantial amount of money by
having the claim prosecuted through [an] assignment.” Reiner also cautioned
Michael, “Time is of the essence because trademark infringement claims can
be subject to such defenses as laches, and waiver, so we want to get started
as very soon as is possible.”

                                         6
      Michael signed the Assignment of Claim document and provided Reiner
a $10,000 check from “Slater’s 50/50 Franchise, LLC,” “for what [he]
understood was, and intended to be, an attorney retainer fee.”
      After signing the Assignment of Claim document and paying Reiner’s
fee, Michael believed he, as principal for Elite and Slater’s, had an attorney-
client relationship with Reiner. Based on this belief, Michael disclosed to
Reiner sensitive information concerning the “business operations, assets, and
proprietary procedures relative to Elite (and Slater’s Franchise), including
the business practices . . . , the standard franchise agreements, [and] specific
business transactions.” At Reiner’s request, Michael provided documents and
information about Slater’s 50/50, including the operations and inner
workings of Elite and Slater’s Franchise, and various contracts and related
documents. Michael also provided Reiner confidential internal information
about Elite and Slater’s Franchise’s other disputes and transactions. Michael
provided this information to Reiner because he believed it was protected by
attorney-client privilege.
      In August 2019, Hill Collections filed a trademark infringement action
in the Superior Court of California, County of Los Angeles, acting as the
assignee of Elite’s claims. The complaint filed in the action identified
Christopher Weston as the attorney for Hill Collections. Reiner’s name does
appear on the documents as he signed the proof of service for the summons
and complaint to the named defendants.
      The trademark infringement case was removed to federal court, and
the defendants moved to dismiss it. Reiner e-mailed Michael and requested
certain documents for the opposition to the motion to dismiss. Michael
forwarded the request to a colleague, explaining his attorney needed the

                                       7
information for the lawsuit. The federal court dismissed the case in
December 2019.
      During the trademark infringement litigation, Michael believed Reiner
was his attorney. Michael was unaware Weston was listed as counsel on the
superior court filing. Michael received no communication from Weston; all
the communication he received regarding the status of the litigation came
from Reiner.
      After the trademark infringement case was dismissed, Reiner offered to
refile the lawsuit. He also requested Michael provide a conflict waiver to
enable him to pursue Abhari’s legal claims against Elite and Slater’s.
Michael refused. Michael then ended the attorney-client relationship with
Reiner.
      Without a waiver, Reiner began pursuing Abhari’s claims against Elite
and Slater’s, acting as the legal representative for Abhari and Abhari’s
company Donya. Reiner engaged in settlement discussions with Michael’s
business counsel regarding the claim. He also e-mailed a settlement offer to
the insurance company concerning the claim. Reiner’s e-mails with the
insurance company and business counsel were sent from his e-mail address
“martinreinerlaw@yahoo.com.”
      Shortly thereafter (March 2020), Michael and his business counsel
realized Reiner had been disbarred by the State Bar of California and was
not a licensed attorney. When Michael questioned Reiner about this, Reiner
denied his license had been suspended or that he had been disbarred. Reiner
asserted: “Any order to either effect is legally null and void. Furthermore,
I have never represented myself to you as acting as an attorney. I am here in
the capacity as the office manager. If anyone represented anything different
about me, they were incorrect. Respectfully, your misperceptions about me

                                       8
should not interfere with your need to communicate your consent to the claim
made with [the insurance company].” In response, Michael stated Reiner had
represented to him that he was an attorney. Michael also sent a screen shot
of Reiner’s profile on the State Bar of California’s website, which showed
Reiner was disbarred and prohibited from practicing law. Reiner claimed the
“State Bar’s representation” was not “the official word” and was “fake news.”
      Michael repeated his claim Reiner had represented to him that he was
an attorney “multiple times.” Additionally, Michael pointed out to Reiner
that Reiner’s “own texts and emails to [Michael] have represented that
[Reiner is] an attorney.” Michael also emphasized that when he first met
Reiner, Reiner said he was an attorney and Abhari had shared e-mails and
texts stating Reiner was Abhari’s attorney. Michael’s business counsel stated
he believed Reiner had been acting as counsel for Abhari and Donya during
their discussions, and he suggested Reiner change his e-mail address to avoid
misleading others.
      In June 2020, the Mirch Firm filed the complaint in the Abhari
litigation, alleging, among other things, that the Slater’s parties made certain
misrepresentations to Abhari to induce him to purchase two Slater’s
restaurants. The Slater’s parties were represented in the litigation by the
law firm of Gordon Rees Scully Mansukhani (Gordon Rees). The parties and
their attorneys participated in mediation. Reiner attended the mediation
with Abhari. At the mediation, the Mirch Firm represented to opposing
counsel that Reiner was a “ ‘lawyer with licensing problems.’ ”
      A Gordon Rees attorney subsequently communicated with the Mirch
Firm about Reiner’s role with the Mirch Firm. The attorney stated she
recently learned Reiner had served as counsel for Slater’s and Elite in the
trademark infringement litigation and during this representation he had

                                       9
obtained privileged attorney-client information. She believed the Mirch
Firm’s involvement with Reiner required the Mirch Firm to withdraw from
the Abhari litigation or be disqualified.
      The Mirch Firm responded there was no basis for disqualification. It
denied Reiner worked with the firm and that he was “acting in any capacity
as an attorney” in the case. The Mirch Firm represented Reiner did clerical
work for Abhari and was present at the mediation to assist Abhari “with the
language barrier.”
      In a subsequent letter to opposing counsel, the Mirch Firm stated that
at the mediation, Reiner “was introduced as a lawyer with licensing
problems . . . acting as an assistant to Mr. Abhari and Donya
Entertainment.” The Mirch Firm indicated it was shocked to learn Reiner
had been retained by Michael. One of the attorneys at the Mirch Firm stated
she had never met Reiner face to face and had only limited conversations
with him. She expressed her understanding he was “an unlicensed attorney
fighting a disciplinary matter and acting as an employee for Donya
Entertainment.”
      After being notified of the communication between the Mirch Firm and
Gordon Rees, Reiner then e-mailed the Gordon Rees attorneys representing
the Slater’s parties from his “martinreinerlaw@yahoo.com” e-mail address
and copied attorneys at the Mirch Firm. In the e-mail, he denied serving as
counsel for Michael, Slater’s, or Elite. He stated he had “communicated with
the Mirch Firm as a witness” and he worked for Abhari and Abhari’s
businesses “in a non-professional capacity.” He cautioned the Gordon Rees
attorneys, “[t]he only way in which you can proceed with your proposed
motion [for disqualification] is by Michael Nakhleh committing the crime of

                                       10
perjury, which would necessitate [Gordon Rees] committing the crime of
suborning Michael Nakhleh’s perjury. Respectfully, do not do that.”
      The Slater’s parties moved to disqualify the Mirch Firm from the
Abhari litigation in federal court. In support of the opposition to that motion,
Reiner submitted a declaration. In his declaration, Reiner admitted he was
disbarred in 2017 but stated he contested his disbarment as “null and void for
being premised upon a wrongful deprivation of [his] [p]rocedural [d]ue
process.” He declared he worked for Abhari’s companies as an office manager
and not as an attorney. Reiner averred he met with Michael and had him
sign the Assignment of Claim form, but Reiner denied presenting himself as
an attorney for Elite and Slater’s and stated it was unreasonable for Michael
to claim Reiner was an attorney for those companies. Reiner also denied
receiving any confidential or attorney-client privileged information from
Michael, Slater’s, or Elite. He asserted the information he received from
them was public information and had no relevance to the Abhari litigation.
He denied providing to or discussing with the Mirch Firm any information or
documents he received in the trademark infringement litigation.
      To support its opposition to the disqualification motion, the Mirch Firm
submitted e-mails between Michael and Reiner it claimed had been provided
by Abhari. Abhari, however, had not been included as a recipient on some of
these e-mails. The Mirch Firm also submitted an e-mail it received from
Reiner explaining Michael “wired the money for Hill Collections, Inc.’s
litigation expenses to [Reiner’s] bank account” for the trademark
infringement litigation “because Hill Collections, Inc. had been recently

formed” and did not have a corporate bank account at that time.3

3     The record indicates that Michael wrote a check to Reiner and did not
wire money to Reiner’s account.
                                      11
      During the Abhari litigation, the Mirch Firm sent correspondence to
the Slater’s parties’ counsel regarding an argument made in the trademark
infringement case—the “argument that Slater’s 50/50 is not a proper
trademark/tradename because it is a ‘non-famous generic name’ not eligible
for such action.” The Mirch Firm claimed Abhari would not have purchased
the franchise if he had known the legitimacy of the trademark/tradename
was at issue. The Mirch Firm further asserted the Nakhlehs and Slater’s did
not disclose these trademark/tradename problems. With the letter, the Mirch
Firm sought the names of witnesses to depose “to determine the time of
Nakhleh Defendants’ knowledge that Slater’s 50/50 franchises [were]
worthless.”
      The federal district court granted the defendants’ motion to disqualify
the Mirch Firm as Abhari’s counsel. The federal court found Reiner falsely
represented to the Slater’s parties he was their attorney and obtained
privileged information relevant to the Abhari litigation. The court further
found the Mirch Firm was using that privileged information “to gain a
tactical advantage in [the] case.” Based on Reiner’s admission he had
communicated with the Mirch Firm as a witness and Reiner’s attendance at
the mediation, the court found there was a legal presumption the Mirch Firm
“ ‘possesses confidential attorney-client information materially related to the
proceedings before the court,’ and that this information ‘has been used or
disclosed.’ [Citation.]” The district court found the Mirch Firm failed to
rebut this presumption and concluded disqualification was the appropriate
remedy.
      The Mirch Firm appealed, and in an unpublished opinion, the Ninth
Circuit affirmed the district court’s order granting defendants’ motion to
disqualify the Mirch Firm finding that Reiner had obtained privileged

                                      12
information from Elite and Slater’s, that the privileged information was
material to the underlying lawsuit, and that there was “a ‘sound basis,’
[citation], for the district court’s conclusion that disqualification was required
to remedy the unfair advantage that Plaintiffs obtained through Mirch’s
representation.” (Mirch Law Firm, LLC, supra, 2022 U.S.App. LEXIS 14564,
at p. *4.)
      The Mirch Firm also represented Ace Foods, LLC and Seth Lindauer in
a lawsuit filed in the Orange County Superior Court, naming Elite, the
Nakhlehs, and others as defendants (Orange County litigation). Similar to
the instant matter and the Abhari litigation, the plaintiffs in the Orange
County litigation were franchisee owners and alleged similar claims in their
complaint as those alleged in the present lawsuit. Elite, Slater’s, and Elias
filed a motion to disqualify the Mirch Firm relying on the same facts
presented in the Abhari litigation. The superior court granted the motion
finding that Reiner had received privileged information, which he provided to
the Mirch Firm.
      The disqualification order was appealed, and on March 14, 2023,
Division Three of this court affirmed the order. (Ace Foods, supra, G061049.)
      Here, the Mirch Firm represented Appellants in their suit against
Respondents and others. Again, the Mirch Firm represented entities that
purchased restaurant franchises that they claim have been overvalued and
misrepresented by the named defendants. Again, the Mirch Firm faced a
motion to disqualify their firm based on information they received from
Reiner. And again, a trial court granted a disqualification motion aimed at
the Mirch Firm. The court explicitly found that Respondents proved the
Mirch Law Firm received confidential information, including communications
between Michael and Reiner. As such, the court concluded that “a rebuttable

                                       13
presumption arose that Reiner disclosed or provided access to privileged
information to the Mirch Firm.” The court also determined that the Mirch
Firm has not rebutted the presumption and that the “weight of the evidence
shows” that the Mirch Firm did receive confidential, privileged information
from Reiner. Further, the court specifically considered and rejected the
Mirch Firm’s claim that the disqualification motion stemmed from
disqualification orders that occurred in other courts concerning the sale of
different restaurant franchises than the ones at issue in this case: “Even so,
the information Elite provided Reiner is relevant to [Appellants’] claims,
particularly given the breadth of the allegations in the operative complaint.”
      Appellants timely appealed.
                                 DISCUSSION
      A. Standard of Review
      Appellants challenge the trial court’s order granting Respondents’
motion to disqualify the Mirch Firm. They claim that the applicable

standard of review is de novo. Not so.4 “ ‘Generally, a trial court’s decision
on a disqualification motion is reviewed for abuse of discretion. [Citations.]’
[Citation.] As to disputed factual issues, a reviewing court’s role is simply to
determine whether substantial evidence supports the trial court’s findings of
fact; ‘the reviewing court should not substitute its judgment for . . . express or

4      Although Appellants acknowledge that the abuse of discretion standard
of review typically applies to an appellate court reviewing an order to
disqualify an attorney, they assert the underlying facts here are undisputed.
Thus, they urge us to apply a de novo standard of review. We disagree. As
we shall discuss post, Appellants maintain that certain evidence presented to
the court was manufactured and ask us to disregard it. Additionally, the
parties challenge some of the trial court’s factual findings, which we review
for substantial evidence. As such, the underlying facts appear to be highly
contested among the parties, and thus, de novo review is inappropriate.
                                       14
implied [factual] findings [that are] supported by substantial evidence.
[Citations.]’ [Citation.] As to the trial court’s conclusions of law, however,
review is de novo; a disposition that rests on an error of law constitutes an
abuse of discretion. [Citations.] The trial court’s ‘application of the law to
the facts is reversible only if arbitrary and capricious.’ [Citation.]” (In re
Charlisse C. (2008) 45 Cal.4th 145, 159 (Charlisse C).) We therefore apply
this widely accepted standard of review to the issues presented here.
      B. Relevant Law
      “ ‘A trial court’s authority to disqualify an attorney derives from the
power inherent in every court “[t]o control in furtherance of justice, the
conduct of its ministerial officers, and of all other persons in any manner
connected with a judicial proceeding before it, in every matter pertaining
thereto.” [Citations.]’ [Citation.]” (Charlisse C., supra, 45 Cal.4th at p. 159.)
“Ultimately, disqualification motions involve a conflict between the clients’
right to counsel of their choice and the need to maintain ethical standards of
professional responsibility. [Citation.] The paramount concern must be to
preserve public trust in the scrupulous administration of justice and the
integrity of the bar. The important right to counsel of one’s choice must yield
to ethical considerations that affect the fundamental principles of our judicial
process. [Citations.]” (People ex rel. Dept. of Corporations v. SpeeDee Oil
Change Systems, Inc. (1999) 20 Cal.4th 1135, 1145.)
      “It is well established that an attorney, after severing his or her
relationship with a client, ‘may not do anything which will injuriously affect
his former client in any matter in which he formerly represented him nor
may he at any time use against his former client knowledge or information
acquired by virtue of the previous relationship.’ [Citations.]” (O’Gara
Coach Co., LLC v. Ra (2019) 30 Cal.App.5th 1115, 1124.) This prohibition is

                                        15
based on governing case law and rule 1.9(a) of the State Bar Rules of
Professional Conduct, which prohibits “[a] lawyer who has formerly
represented a client in a matter” from representing “another person in the
same or a substantially related matter in which that person’s interests are
materially adverse to the interests of the former client unless the former
client gives informed written consent.”
      C. Attorney-Client Relationship
      The trial court found that “Elite reasonably believed Martin Reiner was
acting as its attorney.” Appellants contend there was no attorney-client
relationship. We disagree and conclude the court’s finding is supported by
substantial evidence.
      “California’s attorney-client privilege is embodied in [Evidence Code]
section 950 et seq. and protects confidential communications between a client
and his or her attorney made in the course of an attorney-client relationship.

[Citations.]”5 (Edwards Wildman Palmer LLP v. Superior Court (2014)
231 Cal.App.4th 1214, 1224.) “Section 951 defines ‘client,’ for purposes of the
privilege, as ‘a person who, directly or through an authorized representative,
consults a lawyer for the purpose of retaining the lawyer or securing legal
service or advice from him in his professional capacity . . . .’ [Citation.]
Section 950 defines ‘lawyer’ as ‘a person authorized, or reasonably believed by
the client to be authorized, to practice law in any state or nation.’ [Citation.]”
(Edwards Wildman, at p. 1225.) Section 952 defines “ ‘confidential
communication between client and lawyer’ ” as “information transmitted
between a client and his lawyer in the course of that relationship and in
confidence . . . .” Section 954 states a client “has a privilege to refuse to

5     Statutory references are to the Evidence Code unless otherwise
specified.
                                        16
disclose, and to prevent another from disclosing, a confidential
communication between client and lawyer . . . .”
      An “attorney-client relationship is created by some form of contract,
express or implied, formal or informal. [Citations.]” (Fox v. Pollack (1986)
181 Cal.App.3d 954, 959.) A party’s subjective belief an attorney-client
relationship exists is insufficient, standing alone, to create such a
relationship or a duty of care owed to the party by the attorney. (Zenith
Ins. Co. v. O’Connor (2007) 148 Cal.App.4th 998, 1010 (Zenith).) A party
“cannot unilaterally establish an attorney-client relationship, and its
hindsight ‘beliefs’ that such a relationship existed are thus legally irrelevant.
[Citation.] Instead, it is the intent and conduct of the parties that control the
question as to whether an attorney-client relationship has been created.
[Citation.]” (Ibid.)
      Against this legal backdrop, we evaluate whether the trial court’s
finding of an attorney-client relationship is supported by substantial
evidence. Respondents’ motion to disqualify the Mirch Firm included
Michael’s declaration. In it, he declared he believed an attorney-client
relationship was formed with Reiner after Michael signed the Assignment of
Claim document and paid Reiner the $10,000 fee required to commence the
trademark infringement litigation. This belief was reasonable but is
insufficient by itself to establish the existence of an attorney-client
relationship. (Zenith, supra, 148 Cal.App.4th at p. 1010.) However, there are
additional facts concerning Michael’s and Reiner’s conduct that reflect on
their intent. After Michael mentioned his companies had a legal issue,
Abhari recommended his attorney Reiner to Michael. When Michael met
him, Reiner presented himself as an attorney and told Michael about his
litigation work on other matters. At times, Reiner used the e-mail address of

                                        17
“martinreinerlaw@yahoo.com,” suggesting he was an attorney. These facts
establish Reiner presented himself as an attorney and Michael reasonably
believed Reiner was authorized to practice law.
      Reiner presented Michael with an Assignment of Claim document and
demanded a fee before he would begin working on the trademark
infringement lawsuit on behalf of Slater’s and Elite. Michael declared Reiner
stated Slater’s and Elite would be his clients after payment of the fee. The
Assignment of Claim and the cover letter with it, both signed by Reiner, are
reasonably understood by a layperson as creating an attorney-client
relationship. In the cover letter, Reiner explained the assignment contract
capped “attorney fees” for pursuing the trademark infringement claim. It was
reasonable for Michael to believe an attorney-client relationship was formed
when he signed the Assignment of Claim document and paid a retainer fee
directly to Reiner. Moreover, during the trademark litigation, Reiner
contacted Michael regarding the status of the case and requested Michael
provide documents from Elite to support the trademark infringement claim.
Thus, there was sufficient evidence an attorney-client relationship was
created between Reiner and Elite.
      Arguing there was no attorney-client relationship, Appellants attack
the validity of the Assignment of Claim document. They assert it was altered
and was not signed by Reiner. There is no evidence in the record the
document was altered and the record contains one copy signed only by Reiner
and a second copy signed by both Michael and Reiner. In addition,
Appellants appear to be asking us to reweigh the evidence considered by the
trial court. This is not our role in evaluating a trial court’s factual finding for
substantial evidence. (See Shadow Traffic Network v. Superior Court (1994)
24 Cal.App.4th 1067, 1087 (Shadow Traffic).)

                                        18
      Appellants rely on Fink v. Shemtov (2012) 210 Cal.App.4th 599 and
assert an assignment of claim does not create an attorney-client relationship.
They read the holding in Fink too broadly. In that case, the Third Division of
this court concluded assignment “arrangements are legal in collection cases
and do not create an attorney-client relationship between the assignor and
the assignee.” (Id. at p. 603.) In contrast, here, the assignment agreement
was not in a collection case. Moreover, the assignment agreement in the
instant matter was substantially different from the assignment agreement in
Fink. (Id. at p. 604.)
      Based on the foregoing, we conclude the trial court properly found an
attorney-client relationship existed between Reiner and Elite. Therefore,
confidential communications made during the course of that relationship are
protected by the attorney-client privilege. (§ 952.)
      D. Joint Representation
      Appellants alternatively argue that even if there was an attorney-client
relationship between Reiner and Elite, the trial court erred in ignoring
Michael’s “sworn admission that a joint representation existed between
himself, Elite, Elias Nakhleh, Abhari, Hill Collections and Reiner as his

attorney.”6 As such, Appellants maintain Respondents are barred by

section 9627 “from asserting an attorney client privilege under their theory of
the case.”

6     Appellants’ representation of Michael’s declaration is not supported by
the record.

7     Section 962 provides “[w]here two or more clients have retained or
consulted a lawyer upon a matter of common interest, none of them . . . may
claim a privilege under this article as to a communication made in the course
of that relationship when such communication is offered in a civil proceeding
between one of such clients . . . and another of such clients . . . .”
                                       19
      Respondents argue that Appellants did not make this argument below.
Appellants counter that the Mirch Firm raised a joint representation
argument at the hearing on Respondents’ motion to disqualify. However,
Appellants do not point to where they made an argument regarding joint
representation in their written opposition to the disqualification motion.
Moreover, our review of the record shows that Appellants made no such
argument until the hearing on the motion.
      The trial court was not required to consider the issue of joint
representation because it was not fully developed or factually presented in
Appellants’ trial court briefs in a manner that would permit Respondents to
provide a meaningful response. (Cf. American Continental Ins. Co. v. C & Z
Timber Co. (1987) 195 Cal.App.3d 1271, 1281 [“possible theories that were
not fully developed or factually presented to the trial court cannot create a
‘triable issue’ ” for summary judgment].) As a general rule of motion practice,
courts ordinarily do not consider new issues and evidence presented in reply
papers because it deprives the opposing party of an opportunity to counter
the argument. (Jay v. Mahaffey (2013) 218 Cal.App.4th 1522, 1537–1538.)
For the same reason, as a matter of fairness, courts may decline to consider
issues raised for the first time at oral argument. (California Redevelopment
Assn. v. Motosantos (2013) 212 Cal.App.4th 1457, 1500.) Because the issue
was not raised below, the trial court did not have an opportunity to consider
evidence as to whether there was a joint representation of “two or more
clients” with a “common interest.” (§ 962.) And as Appellants did not
adequately raise this issue in the trial court, they are precluded from raising
the issue on appeal. (Holden v. City of San Diego (2019) 43 Cal.App.5th
404, 419.) As such, we will not consider it for the first time here as we deem
this argument forfeited. (In re N.R. (2017) 15 Cal.App.5th 590, 598 [claim

                                       20
involving “issue of fact rather than a pure question of law,” is forfeited by
failure to raise it below].)
      Even if Appellants had not forfeited this argument, we would not
reverse the trial court’s disqualification order on this ground. The possibility
that some of Michael’s communications with Reiner might be unprotected
under the joint-client exception (§ 962) does not negate the requirement of
disqualification in this case. Disclosure of client communication is not the
only concern; there are also broader interests at play. (Western Continental
Operating Co. v. Natural Gas Corp. (1989) 212 Cal.App.3d 752, 761–762
[“Our courts have distinguished the rule against representing conflicting
interests from the attorney-client evidentiary privilege noting that the former
is broader than the latter”].) “The California Supreme Court
has . . . repeatedly held that the disqualification rules are not merely
intended to protect client confidences or other ‘interests of the parties’;
rather, ‘[t]he paramount concern . . . [is] to preserve public trust in the
scrupulous administration of justice and the integrity of the bar.’ [Citation.]
In light of these significant public interests, we do not agree that matters of
disqualification should be determined solely by reference to evidentiary
rules.” (Fiduciary Trust Internat. of California v. Superior Court (2013) 218
Cal.App.4th 465, 485–486, fn. omitted.) As to the issue of attorney
disqualification, in the instant matter especially, joint representation is not
dispositive. (Id. at pp. 482–486.)
      E. Waiver
      “ ‘Once the proponent makes a prima facie showing of a confidential
attorney-client communication, it is presumed the communication is
privileged and the burden shifts to the opponent to establish waiver, an
exception, or that the privilege does not for some other reason apply.’

                                        21
[Citations.]” (McDermott Will & Emery LLP v. Superior Court (2017) 10
Cal.App.5th 1083, 1101.) Appellants contend the trial court erred by failing
to recognize that Respondents “waived the attorney[-]client privilege when
they filed protected documents in federal court in the Abhari litigation.” We
disagree. Appellants have failed to establish Respondents waived their
privilege.
      A judgment or order is presumed correct, and reversible error must be
affirmatively shown. (Denham v. Superior Court (1970) 2 Cal.3d 557, 564.)
“Every argument presented by an appellant must be supported by both
coherent argument and pertinent legal authority.” (Kaufman v. Goldman
(2011) 195 Cal.App.4th 734, 743 (Kaufman).) “Generally, asserted grounds
for appeal that are unsupported by any citation to authority and that merely
complain of error without presenting a coherent legal argument are deemed
abandoned and unworthy of discussion.” (Wright v. City of Los Angeles (2001)
93 Cal.App.4th 683, 689; see United Grand Corp. v. Malibu Hillbillies, LLC
(2019) 36 Cal.App.5th 142, 162 (United Grand Corp.) [“ ‘In order to
demonstrate error, an appellant must supply the reviewing court with some
cogent argument supported by legal analysis and citation to the record.’ ”)
      Appellants assert Respondents included certain e-mails between Reiner
and Michael in the disqualification motion filed in the Abhari litigation, and
by doing so, Respondents waived attorney-client privilege as to all of their
communications with and information provided to Reiner. To this end, they
represent:
         “Exhibit S in the Abhari Motion to Disqualify is the same
         as Mirch’s Ex. 13 in Abhari opposition; similarly . . .
         Exhibit F in Abhari is the same as Mirch’s Ex. 15; . . . Ex. Q
         in Abhari is the same as Mirch’s Ex. 18; . . . Ex. J in Abhari
         is the same as Mirch’s Ex 19; and . . . Exhibit R in Abhari is
         the same as Mirch’s Ex 22.”

                                      22
         In support of this argument, Appellants point us to the declaration of
Marie Mirch, filed in the instant action, wherein she attests that the alleged
privileged e-mails constituting Exhibits 13, 15, 18, 19, 21, and 22 “came into
the Mirches’ possession when [Elite and Slater’s] filed them publically [sic] as
exhibits to their motion to disqualify.” We note that Kevin Mirch made a
similar representation in his declaration filed in the instant matter as well.
Thus, based on those two declarations filed below, Appellants claim that they
came into possession of the subject e-mails after Elite and Slater’s filed those
e-mails in support of their motion to disqualify in the Abhari litigation.
Notably, Appellants have not cited to Slater’s and Elite’s actual filing of the
e-mails in the district court. Rather, they rely on their declarations to offer
the conclusion the exhibits are the same.
         Further, we observe that in filing Exhibits 13, 15, 18, 19, 21, and 22 in
support of the opposition to the motion to disqualify in the Abhari litigation,
the plaintiffs filed a notice of lodgment that included a declaration from
Kevin Mirch. In that declaration, Kevin Mirch stated that he received the
subject exhibits from Abhari. Therefore, Kevin Mirch’s declaration in the
Abhari litigation calls into question Appellants’ representation in the instant
matter that they came into possession of the subject e-mails when Slater’s
and Elite filed them in support of their disqualification motion in district
court.
         Here, Appellants’ waiver argument hinges upon their representation
that they came into possession of the subject e-mails when the defendants
filed those e-mails as part of their motion to disqualify in the Abhari
litigation. Yet, that contention is contradicted by Kevin Mirch’s declaration
wherein he claims Abhari gave him the e-mails. As such, the factual premise

                                         23
on which Appellants rely is contested, and we cannot resolve a factual
dispute in an abuse of discretion review. (See Charlisse C., supra, 45 Cal.4th
at p. 159.)
      Below, the superior court made a finding that Appellants had not
waived the attorney-client privilege by filing the subject e-mails in support of
their qualification. That finding is supported by substantial evidence based
on Kevin Mirch’s declaration that he received the subject e-mails from
Abhari. Those e-mails were between Michael and Reiner. Abhari introduced
Michael to Reiner and told Michael that Reiner was his attorney. Reiner
appeared with Abhari at the mediation of the Abhari litigation. Thus, the
trial court could reasonably infer that Reiner was communicating with one of
the parties suing Respondents (Abhari) and his new attorneys (the Mirch
Firm).
      And Appellants have failed to provide us with adequate legal authority
to support their challenge here. Indeed, the only authority Appellants cite to
support their waiver argument is rule 502 of the Federal Rules of Evidence
(28 U.S.C.), but they do not sufficiently explain why the district court or the

superior court erred in failing to find waiver under that rule.8 Accordingly,
Appellants have not carried their burden on appeal as to their waiver
argument. (See Kaufman, supra, 195 Cal.App.4th at p. 743; United Grand
Corp., supra, 36 Cal.App.5th at p. 162.)

8      Additionally, any waiver by Respondents of their attorney-client
privilege in the disqualification motion in the Abhari litigation did not
absolve Reiner of his breach of his duty of loyalty to Elite, which took place
before the filing of the disqualification motion, or his obligation to maintain
his clients’ confidences. Moreover, it is Kevin Mirch’s declaration filed in the
Abhari litigation that strongly supports this conclusion.
                                       24
      F. Trial Court’s Reliance on Communications After the Termination of
         the Attorney-Client Relationship

      Appellants take issue with the following finding of the trial court:
“ . . . Def.’s Ex. 26 (referencing exs. 16-17, 20-21). That exhibit, however,
shows Mirch received the communications between [Michael] and Reiner and
the contents do not indicate a voluntary disclosure of Elite’s confidential
privileged information.” Appellants contend the trial court erred by relying
on these communications because they are not attorney-client confidential
communications. We see no error in the trial court’s discussion of these
e-mails.
      As a threshold matter, we observe that Appellants do not appreciate
the context in which the trial court discussed Exhibit 26. The court
specifically cited to that exhibit when addressing Appellants’ waiver
argument. To this end, the court stated:
           “[Appellants] also argue defendants waived the privilege
           when they filed the certain emails in support of their
           disqualification motion. Opp. at 12-14, citing e.g., Def.’s
           Ex. 26 (referencing exs. 16-17, 20-21). That exhibit,
           however, shows Mirch received the communications
           between [Michael] and Reiner and the contents do not
           indicate a voluntary disclosure of Elite’s confidential
           privileged information.”

      The court relied on these communications as evidence Reiner was
providing information to the Mirch Firm, even if it was ultimately provided
by Abhari. The trial court’s finding that these communications came from
Reiner, not Abhari, is supported by substantial evidence. Each
communication was between Reiner and Michael; Abhari was not included in
them. Thus, it is evident Reiner was the source of these communications.

                                         25
And they are evidence Reiner was transmitting communications he had with
his former client, privileged or not, to counsel for the adversary of his former
client.
      Moreover, Exhibit 26 consisted of a portion of the documents that the
plaintiffs (represented by the Mirch Firm) filed in support of their opposition
to the motion to disqualify in the Abhari litigation. Many of these documents
consist of e-mails between Michael and Reiner, and some specifically relate to
Michael’s belief that Reiner was Elite’s attorney for a period of time. In
addition, there was an email from Reiner (with the address
martinreinerlaw@yahoo.com) addressed to attorneys at the Mirch Firm,
claiming that Michael had paid money to Reiner, leading to the reasonable
inference that Reiner was sharing information with the Mirch Firm about his
dealings with Michael and Elite, even discussing the context of his legal
representation of Elite.
      G. Presumption That Material Confidential Information was
         Transmitted to the Mirch Firm

      Appellants contend the trial court should have denied the
disqualification motion because Respondents failed to satisfy their burden of
showing the privileged attorney-client information Reiner received in the
trademark infringement litigation was material to the current matter.
Appellants also assert they rebutted the presumption the Mirch Firm
received privileged communications from Reiner as the firm’s attorneys
attested they received the information in their complaint from sources other
than Reiner.
      When determining whether the Mirch Firm had presumed or actual
access to material, privileged information, the trial court relied on Shadow
Traffic, supra, 24 Cal.App.4th 1067. There, the court concluded that once the
party moving for disqualification has established its counsel transmitted
                                       26
confidential information to the potential expert, “ ‘a rebuttable presumption
arises that the information has been used or disclosed in the current
employment. The presumption is a rule by necessity because the party
seeking disqualification will be at a loss to prove what is known by the
adversary’s attorneys and legal staff. [Citation.]’ [Citation.]” (Id. at p. 1085.)
“As the purpose of this presumption is to implement the public policy of
protecting confidential communications, the presumption is one affecting the
burden of proof. [Citation.] The effect of this type of presumption ‘is to
impose upon the party against whom it operates the burden of proof as to the
nonexistence of the presumed fact.’ [Citation.]” (Ibid.) Further, the trial
court found plaintiff’s attorneys had transmitted confidential information to
an expert subsequently retained by the defendant’s attorneys, giving rise to
the presumption the expert used or disclosed this confidential information in
its employment with the defendant’s attorneys. The burden then shifted to
the defendant’s attorneys to persuade the court by a preponderance of the
evidence it had not received the confidential information. (Ibid.)
      Employing this analysis in the instant matter, the trial court found
that Respondents had shown that the Mirch Firm received confidential
information, “including communications between [Michael] and Reiner, via
Zia Abhari.” This finding is supported by substantial evidence based on the
multiple e-mails the Mirch Firm had in its possession that were between
Michael and Reiner. In addition, at least one email from Reiner to attorneys
at the Mirch Firm indicated that he was talking with those attorneys
regarding his interaction with Michael regarding the previous trademark
litigation. The court found the information and documentation conveyed to
Reiner was materially relevant to the instant matter. This finding is
supported by substantial evidence. During the Orange County litigation, the

                                       27
Mirch Firm sent a letter to counsel for the Slater’s parties, acknowledging
information in the trademark infringement litigation was relevant to Ace
Foods’ claims concerning the value, or lack thereof, of the Slater’s franchise.
Moreover, the trial court below observed that, although the instant matter
concerned different plaintiffs than the Abhari litigation and Orange County
litigation, the information Elite provided to Reiner was “relevant to
[Appellants’] claims, particularly given the breadth of the allegations in the
operative complaint.” For example, the operative complaint in the instant
action accuses Respondents (among others) of engaging in a “nationwide”
“scheme” to inflate the value of various franchises and entice would be buyers
to overpay for them. And the complaint specifically includes allegations that
“Daphne’s, Slater’s and Mimi restaurants were all part of the scheme.” The
complaint in the Abhari litigation also included alleged wrongdoing involving
the value of certain Daphne’s restaurant franchises as did the operative

complaint in the Orange County litigation.9 Therefore, the trial court’s
findings triggered the presumption Reiner disclosed material confidential
information to the Mirch Firm in his communications with them. (Shadow
Traffic, supra, 24 Cal.App.4th at p. 1085.)
      “When a judicially created presumption affecting the burden of proof is
triggered, the question of whether the party who has the burden of
establishing the nonexistence of the presumed fact has carried its burden of
persuasion is an issue for the trier of fact to decide, not a reviewing court.
[Citation.] Thus, we may not reweigh the evidence or substitute our
deductions for those of the trial court. [Citations.]” (Shadow Traffic, supra,

9     Indeed, the complaint in the Abhari litigation specifically mentions the
eight Daphne’s restaurants that Karma purchased, which are the basis for
the instant matter.
                                        28
24 Cal.App.4th at p. 1087.) Here, the trial court found the Mirch Firm’s
declarations stating they had no relationship with Reiner were insufficient to
rebut the presumption, given the other evidence showing Reiner was
providing information to them and Reiner’s declaration stating he had
communicated with the firm as a witness in the Abhari litigation. The trial
court also found not credible the Mirch Firm’s claim Reiner was only acting
as a translator for Abhari at the mediation hearing. We will not reweigh the
evidence or substitute our deductions for those of the trial court. Because
Appellants failed to rebut the presumption Reiner disclosed material
confidential information to the Mirch Firm, the trial court did not abuse its
discretion in granting the motion to disqualify the Mirch Firm.
                                 DISPOSITION
      The order disqualifying the March Firm is affirmed. Respondents are
entitled to their costs on appeal.

                                                      HUFFMAN, Acting P. J.

WE CONCUR:

DO, J.

CASTILLO, J.

                                      29