Court Opinion

ID: 147483
Source: CourtListenerOpinion
Date Created: 2010-05-28 22:10:02+00
Date Added: 2024-06-11T17:24:04.606284
License: Public Domain

FILED
                            NOT FOR PUBLICATION                             MAY 28 2010

                                                                        MOLLY C. DWYER, CLERK
                    UNITED STATES COURT OF APPEALS                       U .S. C O U R T OF APPE ALS

                            FOR THE NINTH CIRCUIT

HAJIME SORAYAMA, an individual,                  No. 07-56487

             Plaintiff - Appellee,               D.C. No. CV-05-01431-FMC

  v.
                                                 MEMORANDUM *
ROBERT BANE LTD INC, a California
corporation; ROBERT S. BANE, an
individual; TAMERA BANE GALLERY,
a business of unknown type; EXOTICA, a
business of unknown type,

             Defendants - Appellants.

                   Appeal from the United States District Court
                       for the Central District of California
                 Florence-Marie Cooper, District Judge, Presiding

                      Argued and Submitted February 3, 2010
                               Pasadena, California

Before: SCHROEDER, FISHER and N.R. SMITH, Circuit Judges.

       Robert Bane Ltd., Inc., Robert S. Bane, Tamera Bane Gallery, and Exotica

(collectively “Bane”) appeal the district court’s judgment, following a bench trial,

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
in favor of plaintiff Hajime Sorayama, an international artist who originally

contracted with Bane, a fine art publisher, in 1994.

         As a preliminary matter, we grant the parties’ motions to take judicial notice

of bankruptcy proceedings involving Bane, and therefore hold that because the

petition has been dismissed, Bane has standing to maintain this appeal.

         Bane’s initial argument on appeal is that the district court deprived

defendants of their right to a jury trial, relying upon our recent decision in Solis v.

County of Los Angeles, 514 F.3d 946, 955 (9th Cir. 2008). Here, however, Bane is

not in a position to contest the district court’s reliance on a local rule. Bane did not

oppose the plaintiff’s motion to strike the jury demand, or present any authority to

the district court contesting the district court’s ruling. Nor did Bane participate in

the lengthy bench trial under protest or ever note any standing objection. Bane’s

contention that he was wrongfully deprived of a jury trial, now that he has lost,

has been waived. See White v. McGinnis, 903 F.2d 699, 703 (9th Cir. 1990) (en

banc).

         More meritorious is Bane’s contention that we should remand for further

proceedings with respect to punitive damages. Under California law, imposition of

punitive damages requires consideration of the defendants’ net worth. See Robert

L. Cloud & Assocs. v. Mikesell, 82 Cal. Rptr. 2d 143, 149 (Cal. Ct. App. 1999);

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Kenly v. Ukegawa, 19 Cal. Rptr. 2d 771, 775–77 (Cal. Ct. App. 1993). The district

judge clearly intended to hold a hearing on punitive damages, but did not do so.

This was error. We therefore must vacate the award of punitive damages and

remand for a hearing to determine defendants’ net worth.

      Defendants finally raise a series of challenges to the district court’s

compensatory damages awards for the torts of conversion, breach of fiduciary

duty, and intentional interference with prospective economic advantage. We find

only two instances of reversible error.

      First, the district court erred in awarding damages for intentional

interference with prospective economic advantage. Under California law, to

establish liability for this tort, a plaintiff must prove that the defendant engaged in

an “independently wrongful act.” Korea Supply Co. v. Lockheed Martin Corp., 63

P.3d 937, 953 (Cal. 2003). “[A]n act is independently wrongful if it is unlawful,

that is, if it is proscribed by some constitutional, statutory, regulatory, common

law, or other determinable legal standard.” Id. at 954. The district court failed to

identify any legal standard that Bane violated when it found that Bane reduced the

benefit of the bargain given to Sorayama. Sorayama argues on appeal that Bane

committed fraud-in-the-inducement, but supplies no legal authority to show that

what Bane did here fits California’s legal definition of that separate tort. The

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award for intentional interference with prospective economic advantage must

therefore be reversed.

      Second, the district court erred in awarding damages for both breach of

contract and the torts of conversion and breach of fiduciary duty. All three claims

rested on Bane’s course of conduct surrounding 33 original paintings that

Sorayama had given to Bane to sell on consignment under the terms of their 1999

agreement. Bane is correct in asserting that by awarding damages for both breach

of contract and tort theories the judgment contains the potential for double

recovery, as Sorayama is not entitled to recover twice for the same harm. See

Rogers v. Davis, 34 Cal. Rptr. 2d 716, 719 (Cal. Ct. App. 1994) (plaintiff may

request alternative remedies, “but may not be awarded both to the extent such an

award would constitute a double recovery”). We therefore vacate the awards for

breach of contract, conversion, and breach of fiduciary duty, and remand for the

district court to adjust the awards to the extent that Sorayama’s tort and contract

recoveries may be duplicative. The district court’s awards of damages on these

three claims are not otherwise clearly erroneous.

      Accordingly, we therefore reverse and remand for the district court to adjust

the awards of punitive and compensatory damages in accordance with this

disposition. The judgment is otherwise affirmed.

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REVERSED in part, AFFIRMED in part, and REMANDED.

The parties shall bear their own costs.

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