Court Opinion

ID: 4512814
Source: CourtListenerOpinion
Date Created: 2020-03-05 00:02:09.843008+00
Date Added: 2024-06-11T09:37:37.202999
License: Public Domain

Filed 3/4/20
            CERTIFIED FOR PARTIAL PUBLICATION*
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                SECOND APPELLATE DISTRICT

                          DIVISION ONE

MOOFLY PRODUCTIONS, LLC,                     B294828
       Plaintiff and Appellant,
                                             (Los Angeles County
                                             Super. Ct. No. BC516308)
       v.

SANDRA FAVILA, Individually and
as Executor, etc.,
       Defendant and Respondent.

SANDRA FAVILA, Individually and
as Executor, etc., et al.,
       Cross-complainants and
       Respondents,
       v.
MOOFLY PRODUCTIONS, LLC,
et al.,
       Cross-defendants and
       Appellants.

     APPEAL from a judgment of the Superior Court of
Los Angeles County, Barbara M. Scheper, Judge. Affirmed.

       *Pursuant to California Rules of Court, rules 8.1100 and
8.1110, this opinion is certified for publication with the exception
of the Discussion post, parts C. and D.
      Barnhill & Vaynerov, Maxim Vaynerov; Walton &
Walton, L. Richard Walton and Javad Navran for Plaintiff,
Cross-defendant and Appellant Moofly Productions, LLC,
and Cross-defendant and Appellant Helena Pasquarella.
      Miller Barondess, Christopher D. Beatty and Bernadette
M. Bolan for Defendant, Cross-complainant and Respondent
Sandra Favila, Individually and as Executor, etc., and
Cross-complainant and respondent Motion Graphix, Inc.
                 ____________________________

       Plaintiff, cross-defendant, and appellant Moofly
Productions, LLC (Moofly) challenges the superior court’s
judgment in favor of defendant, cross-complainant, and
respondent Sandra Favila, the executrix of the Estate of Richard
Corrales, and cross-complainant and respondent Motion Graphix,
Inc. (collectively the Estate). Moofly sued Favila for actions
the Estate took when attempting to collect on a judgment in
a previous, related case. The Estate filed a cross-complaint,
accusing Moofly, as well as its owner, cross-defendant and
appellant Helena Pasquarella, and Pasquarella’s ex-husband,
Raleigh Souther, of fraudulent transfers and other causes of
action. Moofly contends that the superior court erred by issuing
terminating sanctions against it, and also contends that the court
erred in several respects in the trial that ended with a judgment
in favor of the Estate on its cross-complaint. We affirm.1

      1  The Estate also filed a motion to dismiss this appeal
because Moofly had not complied with the terms of the trial
court’s judgment. We deny that motion.
            FACTS AND PROCEEDINGS BELOW
      This appeal is the latest stage in a long-running dispute
involving parties who have been litigating against one another
under various captions in federal and state court at both the trial
and appellate level since 2007. We will describe only those facts
germane to this appeal.
      In 2000, Souther and Richard Corrales founded a company
called Motion Graphix, Inc. (Motion), which specialized in
lenticular photography, a technology for creating pictures that
change appearance depending on the angle from which they
are viewed. Corrales owned 51 percent of Motion, and Souther
owned the remaining 49 percent. By 2005, the two owners had
become estranged. In November 2005, Corrales died.
      In January 2007, Souther transferred all of Motion’s assets
from Motion to Get Flipped, Inc., owned entirely by Souther and
his wife, Pasquarella. Souther then purported to dissolve Motion
and forged a signature on a document filed with the Employment
Development Department in an attempt to make Favila, the
executrix of Corrales’s Estate, responsible for Get Flipped’s
unpaid payroll taxes.
      The Estate filed suit against Souther and Get Flipped,
and in 2010 obtained a judgment of $3,417,112.70 in damages
and interest. The court also imposed a constructive trust on
51 percent of Get Flipped’s assets, representing the Estate’s
share of the assets that had been transferred from Motion.

                                 3
       Following the entry of judgment, Souther and Pasquarella
created yet another company, Moofly, doing business as
3D Cheeze. Pasquarella owned 90 percent of the new company,
and Souther owned the remaining 10 percent.2 In 2011, Get
Flipped announced on social media that it was “rebranding” as
“Moofly/3D Cheeze” and transferred all of its assets to Moofly.
       In 2013, Moofly sued Favila in her capacity as executrix
of the Estate in the superior court, alleging causes of action for
intentional interference with prospective economic advantage,
unfair competition, and related claims. Moofly claimed that,
in order to divert business from Moofly, the Estate sent letters
to Moofly’s clients stating that Moofly was infringing on the
Estate’s intellectual property. The Estate filed a cross-complaint,
which was composed primarily of state law causes of action for
fraudulent transfer, conversion, and unfair competition, but also
included a federal cause of action for copyright infringement.
       The Estate removed the case to federal district court on
the basis of the copyright infringement claim. While the case
was pending in federal court, Moofly failed to respond to the
Estate’s discovery requests on several occasions. A magistrate
judge eventually recommended that the district court issue
terminating sanctions and dismiss Moofly’s complaint because
“Moofly has repeatedly failed to abide by its basic discovery
obligations, including failing to provide initial disclosures, failing
to meet and confer, failing to participate in the joint stipulation
process, and failing to respond to discovery requests. Further,
Moofly has repeatedly failed to abide by this [c]ourt’s orders to
provide discovery responses and to pay sanctions for failing to
produce the discovery on time.”

      2In its appellate brief, Moofly claims that Pasquarella now
owns 100 percent of Moofly.

                                  4
       The district court addressed the magistrate judge’s
recommendation together with a motion to dismiss the Estate’s
cause of action for copyright infringement. The court dismissed
the Estate’s copyright infringement claim for failure to state
a claim. (See Fed. Rules Civ. Proc., rule 12(b)(6); 28 U.S.C.)
Because the remaining claims in the litigation arose primarily
under California law, the court remanded the case to the superior
court for further proceedings. The district court found the
magistrate judge’s report “thorough and well-reasoned” and was
“persuaded that the conclusions and suggested remedies laid out
in the [r]eport are well-supported by the record.” Nevertheless,
the district court declined to dismiss Moofly’s complaint and, “in
the interests of comity and deference,” left it to the superior court
to decide whether to issue terminating sanctions.
       On remand, the Estate filed a motion requesting that the
superior court adopt the magistrate judge’s report and issue
terminating sanctions. The superior court granted the motion,
finding that “the entire course of Moofly’s behavior demonstrates
its utter disregard for the court as well as court procedures,”
and that “Moofly’s persistent and repeated failure to pay
the monetary sanctions ordered support a finding that
lesser sanctions have proven ineffective in gaining Moofly’s
compliance.”
       Following the dismissal of Moofly’s complaint, the case
proceeded to trial on the Estate’s cross-complaint. The superior
court bifurcated the trial, beginning with a court trial on the
causes of action for fraudulent transfer and injunctive relief.
       The superior court found that the transfer of assets from
Get Flipped to Moofly was a fraudulent transfer designed to
prevent the Estate from collecting on the judgment. The court
granted a mandatory injunction directing plaintiffs to transfer

                                 5
back to Get Flipped all the assets that had previously been
transferred from Get Flipped to Moofly. The court also ordered
restitution of the profits plaintiffs earned from the fraudulently
transferred property, and issued a prohibitory injunction to
prevent plaintiffs from any further transfers of property.3

                           DISCUSSION
       Moofly makes four claims on appeal. It contends: (1) that
the superior court erred by denying a jury trial on the fraudulent
transfer cause of action; (2) that the superior court abused its
discretion by issuing terminating sanctions on its complaint;
(3) that the superior court exceeded its jurisdiction by awarding
the return of derivative copyrighted materials, an issue that
Moofly contends must be decided in federal court; and (4) that
the superior court erroneously included Pasquarella as a party
liable under the judgment after finding that Moofly alone was
the recipient of the fraudulent transfer. We affirm.

      A.    Jury Trial on Fraudulent Transfer Cause
            of Action
       Moofly contends that the superior court erred by denying
its request for a jury trial on its cause of action for fraudulent
transfer. We disagree. To provide the relief sought in this cause
of action, the superior court was required to apply equitable
doctrines, and Moofly was therefore not entitled to a jury trial.
       The California Constitution guarantees the right to
a jury trial (see Cal. Const., art. I, § 16), but “the right so
guaranteed . . . is the right as it existed at common law in 1850,
when the Constitution was first adopted . . . . As a general

      3 After its victory in the first phase of the trial, the Estate
voluntarily dismissed the remaining causes of action in the
cross-complaint.

                                  6
proposition, ‘[t]he jury trial is a matter of right in a civil action
at law, but not in equity.’ ” (C & K Engineering Contractors v.
Amber Steel Co. (1978) 23 Cal. 3d 1, 8 (C & K Engineering).) The
Code of Civil Procedure also guarantees the right to a jury trial
“[i]n actions for the recovery of specific, real, or personal property,
with or without damages” (Code Civ. Proc., § 592),4 but that
provision “is historically based and does not expand the jury trial
right beyond its common law scope.” (Corder v. Corder (2007)
41 Cal. 4th 644, 656.)
         Our Supreme Court has described the following method
for determining whether a party has a right to a jury trial:
“ ‘ “If the action has to deal with ordinary common-law rights
cognizable in courts of law, it is to that extent an action at law.
In determining whether the action was one triable by a jury at
common law, the court is not bound by the form of the action
but rather by the nature of the rights involved and the facts of
the particular case—the gist of the action. A jury trial must be
granted where the gist of the action is legal, where the action
is in reality cognizable at law.” ’ ([People v. One 1941 Chevrolet
Coupe (1951) 37 Cal. 2d 283, 299], fn. omitted . . . .) On the other
hand, if the action is essentially one in equity and the relief
sought ‘depends upon the application of equitable doctrines,’
the parties are not entitled to a jury trial.” (C & K Engineering,
supra, 23 Cal.3d at p. 9.)
         In most instances, courts have considered suits to reverse
fraudulent transfers to be actions at equity. In Bank of America
v. Greenbach (1950) 98 Cal. App. 2d 220, the court held that
“where no individual money damages are sought, and where
the plaintiff seeks only to rescind and to recover the fraudulently

      4Unless otherwise specified, subsequent statutory
references are to the Code of Civil Procedure.

                                  7
conveyed assets, the action is equitable, and a jury trial is not a
matter of right.” (Id. at p. 229.) Similarly, the court in Pedro v.
Soares (1937) 18 Cal. App. 2d 600 described an action to set aside
a fraudulent conveyance as “an action in equity.” (Id. at p. 608.)
       Nevertheless, Moofly argues that it was entitled to a jury
trial under Wisden v. Superior Court (2004) 124 Cal. App. 4th
750, 756–757, in which the court held that the right to a jury trial
applied to a fraudulent conveyance cause of action. In that case,
however, the court limited its holding to actions “to recover a
fraudulent conveyance of a determinate sum of money.” (Id. at
p. 757.) The court relied on Granfinanciera, S. A. v. Nordberg
(1989) 492 U.S. 33 (Granfinanciera), in which the United States
Supreme Court reviewed the history of fraudulent transfer
actions at law and equity prior to 1791 and concluded that the
proper form of the suit depended on the nature of the property
to be recovered: “ ‘If the subject matter is a chattel, and is still
in the grantee’s possession, an action in trover or replevin would
be the trustee’s remedy; and if the fraudulent transfer was of
cash, the trustee’s action would be for money had and received.
Such actions at law are as available to the trustee today as they
were in the English courts of long ago. If, on the other hand,
the subject matter is land or an intangible, or the trustee needs
equitable aid for an accounting or the like, he may invoke the
equitable process, and that also is beyond dispute.’ ” (Id. at p. 44,
quoting Buzard v. Houston (1886) 119 U.S. 347, 352–353.)5

      5 A standard jury instruction applicable in actions to void
transfers under the Uniform Voidable Transactions Act (see Civ.
Code, § 3439.04) draws the same distinction. The Directions for
Use of CACI No. 4200 states that there is a right to a jury trial
in cases where the plaintiff is seeking monetary relief, but not
where the plaintiff seeks nonmonetary relief.

                                 8
       An action to recover a fraudulent conveyance of a
determinate sum of money must proceed under law because in
such a case, “a complete remedy is available at law, and equity
will not countenance an action when complete relief may be
obtained at law.” (Granfinanciera, supra, 492 U.S. at p. 49,
fn. 7.) In this case, however, no complete remedy was available
at law. The Estate sought to reverse the transfer of at least
three different classes of property: (1) chattels, such as computer
equipment; (2) money, in the form of “proceeds and profits”
of the fraudulently transferred property;6 and (3) intangibles,
such as “software codes . . . ; all trademarks, copyrights, patents
and domain names . . . ; all inventions, designs, know-how,
trade secrets, improvements, formulae, works of authorship
and similar assets . . . ; phone numbers; websites; improvements
and derivatives of those assets.” No proceeding at law could have
provided the Estate “a plain, complete, speedy, and adequate
remedy” (Andal v. City of Stockton (2006) 137 Cal. App. 4th 86,
91), in the way that an action for money had and received could
have provided relief to the plaintiffs in Granfinanciera and
Wisden. Even the money the Estate demanded was not a
determinate sum, but rather required the equitable remedy
of an accounting to determine the amount of profits Moofly,

      6 In its cross-complaint, the Estate claimed that it
was “entitled to an award of exemplary and punitive damages
against” Moofly, Pasquarella, and Souther for fraudulent
transfer. In the hearing to determine whether Moofly was
entitled to a jury trial, however, the Estate stipulated that it
was not seeking monetary damages for fraudulent transfer,
and the trial court did not award the Estate any damages.
We need not and do not decide whether a jury trial would
have been required if the Estate had not waived this claim.

                                 9
Pasquarella, and Souther obtained from fraudulently transferred
property.
       Nor do we perceive any way the superior court could
have divided the fraudulent transfer cause of action and tried
the equitable portions separately from the legal portions.
One of the key questions in any action for fraudulent transfer
is whether the transferor “receiv[ed] a reasonably equivalent
value in exchange for the transfer or obligation.” (Civ. Code,
§ 3439.04, subd. (a)(2).) The evaluation of that question required
considering all of the property Moofly received, and would
not have allowed separate trials for the chattels, cash, and
intangibles.
       Because the Estate’s cause of action for fraudulent transfer
was “essentially one in equity and the relief sought ‘depend[ed]
upon the application of equitable doctrines,’ ” Moofly was “not
entitled to a jury trial.” (C & K Engineering, supra, 23 Cal.3d
at p. 9.)

      B.    Propriety of Terminating Sanctions
       Moofly contends that the superior court abused its
discretion by granting the Estate’s motion for terminating
sanctions. Moofly argues that it did not receive proper notice
of the potential for terminating sanctions, and that there were
insufficient grounds for issuing terminating sanctions. We are
not persuaded.
       Moofly’s claim that it did not receive adequate notice of
the Estate’s motion for terminating sanctions is without merit.
The Estate filed a notice of motion in which it stated that it was
requesting that the superior court “[a]dopt[ ] and implement[ ]
the [f]inal [r]eport and [r]ecommendation” of the federal
magistrate judge, “which called for the imposition of specified

                                10
terminating, evidentiary[,] and issue sanctions” against Moofly.
The Estate served the notice of motion on Moofly’s attorneys.
This was sufficient to satisfy the relevant notice requirements.
(See § 1010.) Furthermore, Moofly filed a “brief in opposition to
[the Estate’s] motion to dismiss” (capitalization omitted), which
argued that terminating sanctions were improper under the
circumstances. The superior court held a hearing, which Moofly’s
attorneys attended, before granting the motion for terminating
sanctions. If there was any defect in the notice, Moofly waived its
objection by responding and participating in the hearing
regarding sanctions. (See Tate v. Superior Court (1975)
45 Cal. App. 3d 925, 930 [“a party who appears and contests a
motion in the court below cannot object on appeal or by seeking
extraordinary relief in the appellate court that he had no notice
of the motion or that the notice was insufficient or defective”].)
       We also reject Moofly’s contention that there were
insufficient grounds to justify the imposition of terminating
sanctions in this case. “A court, after notice and an opportunity
for a hearing, may impose sanctions on a party, person, or
attorney for misuse of the discovery process. (§ 2023.030.)
Section 2023.030 describes the types of sanctions that a court
may impose, including monetary, issue, evidence, terminating,
and contempt sanctions. ([§ 2023.030], subds. (a)–(e).)”
(New Albertsons, Inc. v. Superior Court (2008) 168 Cal. App. 4th
1403, 1422 (New Albertsons).) A trial court may impose
sanctions, however, only “[t]o the extent authorized by the
chapter governing any particular discovery method or any
other provision of this title.” (§ 2023.030.) “This means that
the statutes governing the particular discovery methods limit
the permissible sanctions to those sanctions provided under
the applicable governing statutes.” (New Albertsons, supra,

                                11
168 Cal.App.4th at p. 1422.) When a party fails to respond to
the opposing party’s interrogatories, the court should begin by
imposing monetary sanctions and ordering the party to respond.
(See § 2030.290, subd. (c).) “If a party then fails to obey an order
compelling answers, the court may make those orders that are
just, including the imposition of an issue sanction, an evidence
sanction, or a terminating sanction.” (Ibid.) In general, a
court may not impose issue, evidence, or terminating sanctions
unless a party disobeys a court order. (See Mileikowsky v. Tenet
Healthsystem (2005) 128 Cal. App. 4th 262, 277, disapproved
on another ground by Mileikowsky v. West Hills Hospital &
Medical Center (2009) 45 Cal. 4th 1259, 1273.) “The statutory
requirement that there must be a failure to obey an order
compelling discovery before the court may impose a nonmonetary
sanction for misuse of the discovery process provides some
assurance that such a potentially severe sanction will be reserved
for those circumstances where the party’s discovery obligation
is clear and the failure to comply with that obligation is clearly
apparent.” (New Albertsons, supra, 168 Cal.App.4th at p. 1423.)
In addition, terminating sanctions are appropriate only if a
party’s failure to obey a court order actually prejudiced the
opposing party. (See Morgan v. Ransom (1979) 95 Cal. App. 3d
664, 669–670.)
       In this case, the requirements for terminating sanctions
were met. The magistrate judge recommended terminating
sanctions in part because Moofly failed to respond to
interrogatory responses after the court ordered it to do so,
and failed to send anyone to attend the hearing in response to
the Estate’s motion for sanctions. The superior court agreed,
ordering terminating sanctions because of “Souther’s failure to
appear at [the] deposition which necessitated a motion to extend

                                12
the discovery deadline, followed by Moofly’s failure to respond
to interrogatories even after being ordered to do so.” In addition,
Moofly’s noncompliance prejudiced the Estate. As the magistrate
judge noted, the Estate “had to expend untold sums of money in
attorney’s fees in their efforts to obtain the most basic discovery
from [d]efendants. And, despite the fact that the [c]ourt ordered
Moofly to produce discovery during the discovery period, Moofly
never did. When Moofly finally produced it after discovery was
closed, it was too late for [d]efendants to investigate Moofly’s
responses.”
       Moofly does not deny any of these facts regarding its
conduct in federal court. Instead, Moofly contends that the
superior court abused its discretion by ordering terminating
sanctions because, by the time the case was before the superior
court, Moofly had served its belated interrogatory responses. At
the time the superior court granted terminating sanctions, the
only remaining defect in its performance was its failure to pay
monetary sanctions. According to Moofly, its prior conduct in
federal court cannot serve as a basis for sanctions in the superior
court.
       We are not persuaded. Moofly has cited no authority, and
we are aware of none, holding that the superior court may not
consider prior conduct in the same case in federal court as a
basis for imposing sanctions. The federal district court elected
to withhold a decision on sanctions “in the interests of comity
and deference,” not in order to give Moofly a reprieve for its
misconduct. And Moofly’s misconduct was not limited to failing
to respond to interrogatories. As the magistrate judge noted,
Moofly failed to serve the Estate with its required initial
disclosures and Souther failed to appear at his deposition until

                                13
the Estate filed motions to compel, and Moofly’s attorneys failed
to attend numerous hearings as scheduled.
       We agree that strict standards must be met before
terminating sanctions are appropriate: “A decision to order
terminating sanctions should not be made lightly. But where
a violation is willful, preceded by a history of abuse, and the
evidence shows that less severe sanctions would not produce
compliance with the discovery rules, the superior court is
justified in imposing the ultimate sanction.” (Mileikowsky v.
Tenet Healthsystem, supra, 128 Cal.App.4th at pp. 279–280.)
Moofly’s conduct was sufficiently egregious that the superior
court did not abuse its discretion by imposing this most extreme
sanction. Moofly effectively failed to participate in the discovery
process until after discovery was closed, then finally produced
interrogatory responses that contradicted its earlier statements,
leaving the Estate unable to prepare adequately for trial. Even
then, Moofly failed to pay the monetary sanctions the superior
court ordered. There is ample support for the magistrate judge’s
statement that “the [c]ourt has tried alternatives but they seem
to have had no impact on Moofly.”

                                14
      C.    Jurisdiction Over Copyright Claims
         Moofly contends that the superior court exceeded its
jurisdiction by ordering it to turn over certain copyrighted
materials such as software, works of authorship, and websites,
as well as assets “related to” the copyrighted materials.
According to Moofly, any assets related to copyrighted materials
would be derivative works, and federal district courts have
exclusive jurisdiction to determine what is a derivative work.
Moofly argues that the superior court therefore lacked
jurisdiction to issue its order. We disagree.
         In support of its argument, Moofly cites section 1338
of title 28 of the United States Code, which provides that
“[t]he [federal] district courts shall have original jurisdiction
of any civil action arising under any Act of Congress relating
to . . . copyrights.” In addition, the federal Copyright Act
provides that “all legal or equitable rights that are equivalent
to any of the exclusive rights within the general scope of
copyright . . . are governed exclusively by” federal copyright law.
(17 U.S.C. § 301.)
         The Ninth Circuit has “adopted a two-part test to
determine whether a state law claim is preempted by the
[Copyright] Act. We must first determine whether the ‘subject
matter’ of the state law claim falls within the subject matter
of copyright as described in [sections 102 and 103 of title 17
of the United States Code]. Second, assuming that it does, we
must determine whether the rights asserted under state law
are equivalent to the rights contained in [section 106 of title 17
of the United States Code], which articulates the exclusive rights
of copyright holders.” (Laws v. Sony Music Entertainment, Inc.
(9th Cir. 2006) 448 F.3d 1134, 1137–1138, fns. omitted (Laws).)

                                15
       Under this test, federal courts have often held that state
law claims seeking to vindicate rights similar to copyright are
preempted by federal law. For example, in Laws, the court held
that a singer could not use California’s common law right to
privacy to prevent a recording company from releasing compact
discs and music videos featuring the singer’s voice. (Laws, supra,
448 F.3d at pp. 1144–1145.) The court reasoned that the singer’s
attempt to assert her right to privacy over the recordings was
essentially the same as asserting copyright over the recordings.
(Ibid.; see also Maloney v. T3Media, Inc. (9th Cir. 2017) 853 F.3d
1004, 1019 [right to publicity of photographs]; Fleet v. CBS, Inc.
(1996) 50 Cal. App. 4th 1911, 1919–1921 [right to publicity of
image and likeness in a motion picture.])
       In this case, even if we assume that the Estate’s claim falls
within the subject matter of copyright, the rights the Estate has
asserted are not equivalent to copyright. The Estate seeks only
the return of property fraudulently transferred from Get Flipped
to Moofly. Some of the property in question may have copyrights
associated with it, but unlike in Laws and related cases
that Moofly cites, this litigation involves no questions about
restrictions on reproducing, displaying, or distributing
copyrighted materials. Given the vast scope of copyright law,
which extends to virtually all “original works of authorship
fixed in any tangible medium of expression” (17 U.S.C. § 102),
if Moofly’s interpretation were correct, it would require virtually
all disputes over a company’s assets to be heard in federal court.
       The federal district court implicitly agreed with our
determination. This case originally involved a claim of copyright
infringement, but the district court dismissed it and remanded
the case to the superior court because it found the remaining
causes of action “arise under California law” and would be “better

                                16
handle[d]” in the superior court. In particular, the district court,
quoting Dead Kennedys v. Biafra (N.D. Cal. 1999) 37 F. Supp. 2d
1151, 1153, noted that “ ‘[a]n action for an accounting or
determination of ownership as between alleged co-owners is
founded in state law and does not arise under the copyright
laws.’ ” (Boldface omitted.) To hold that the federal court had
exclusive jurisdiction over the remaining claims in this case after
the federal court found to the contrary would leave the Estate
with no venue to bring its claims.

      D.    Inclusion of Pasquarella in the Judgment
       Moofly contends that the superior court erred by including
Pasquarella as a party liable for the judgment. Pasquarella owns
100 percent of Moofly, and formerly owned part of Get Flipped.
Moofly’s argument proceeds as follows: In an action for
fraudulent transfer, a creditor’s remedy is “[a]voidance of the
transfer or obligation.” (Civ. Code, § 3439.07, subd. (a)(1).)
The superior court found that Pasquarella and her ex-husband
Souther “transferred all of Get Flipped’s assets into Moofly.”
Pasquarella therefore has no assets from the transfer, and the
Estate’s remedy lies only with Moofly.
       This argument is without merit. Although the superior
court found that Pasquarella and Souther initially transferred
all of Get Flipped’s assets to the newly formed Moofly, the
court found that, approximately five years later, Souther
conditionally transferred the company’s copyrights and
trademarks to Pasquarella. A creditor may obtain a judgment
not merely against the initial transferee, but also against a
subsequent transferee. (Civ. Code, § 3439.08, subd. (b)(1).)
Furthermore, Moofly did not include a reporter’s transcript of
the trial proceedings in the record on appeal, and we cannot rule

                                 17
out the possibility that there was evidence presented at trial of
further transfers to Pasquarella. (See Parker v. Harbert (2012)
212 Cal. App. 4th 1172, 1178 [appellant bears burden to provide
adequate record to demonstrate error].)

                         DISPOSITION
      The judgment of the trial court is affirmed. Respondents
are awarded their costs on appeal.
      CERTIFIED FOR PARTIAL PUBLICATION.

                                     ROTHSCHILD, P. J.
We concur:

                  CHANEY, J.

                  BENDIX, J.

                                18