Breeden v. Sup. Ct.

Filed 4/19/06 Breeden v. Sup. Ct. CA2/1

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

California Rules of Court, rule 977(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 977(b). This opinion has not been certified for publication or ordered published for purposes of rule 977.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION ONE

ORIGINAL PROCEEDING; petition for writ of mandate. Gerald Rosenberg, Judge. Petition granted.

Law Office of Leslie M. Baker and Leslie M. Baker for Petitioner.

No appearance for Respondent.

Morris Polich & Purdy, Charles E. Slyngstad, Richard H. Nakamura, Jr. and Maureen M. Home for Real Party in Interest.

___________________________

The trial court erred in denying John Breeden's alternative motion to stay. Accordingly, we grant the writ of mandate.[1]

FACTUAL AND PROCEDURAL BACKGROUND

John Breeden is a Hawaii resident. Richard Acheson is a California resident. Acheson was the Chief Financial Officer of Clear Air Technology, Inc. (CATI), a Delaware corporation with its principal place of business in Hawaii. He was also an officer and director of Creative Telecommunications, Inc. (CTI), a Nevada corporation with its principal place of business in Hawaii. Between November 1, 1996 and January 1, 1999, Acheson and William Russell Simmons raised investment funds for CATI and CTI in Hawaii. Breeden invested in both companies.

In 1998, CTI sued Breeden in the United District Court for the District of Hawaii. Breeden counterclaimed against CTI, CATI, Acheson, and Simmons. On May 7, 2002, after four years of litigation, an arbitrator issued an award in favor of Breeden and against CATI, CTI, and Simmons.[2] The arbitration award was confirmed by the United States District Court for the District of Hawaii and a final judgment was entered against CATI and CTI on August 30, 2002. Neither of the companies appealed. A final judgment was not entered against Simmons because he initiated bankruptcy proceedings shortly after the arbitrator announced his decision (on May 31, 2002 in the Santa Ana Division of the United States Bankruptcy Court for the Central District of California).

On December 29, 2004, Breeden sued Acheson in Hawaii, alleging claims for fraud and conversion. Breeden sent a copy of the complaint as an e-mail attachment to a California resident, Dr. Randall Young.

To prevent his claim against Simmons from being discharged in the bankruptcy case, Breeden filed a complaint to bar discharge and to determine the dischargeability of the debt on September 9, 2002. On June 10, 2005, the Bankruptcy Court ordered Breeden to be present at the next hearing on July 15, 2005.

On July 15, 2005, at the Bankruptcy Court hearing, Acheson served Breeden with a complaint for libel that was filed in the Los Angeles Superior Court. The basis for the libel action was the publication of defamatory material to a California resident, which allegedly caused injury to Acheson's reputation in California.

On August 22, 2005, Breeden moved to quash summons and complaint or, in the alternative, to stay or dismiss the California action on the ground that he had been a Hawaii resident for the past ten years, did not own any property in California, and did not conduct any business in the state. His only connection to California was that he was a creditor in a bankruptcy case in Santa Ana. He attended only one hearing in the bankruptcy court. In opposition, Acheson pointed to the e-mail Breeden had sent to a resident of California, Dr. Randall Young (the e-mail to which the Hawaii complaint was attached).

On February 1, 2006, the trial court denied Breeden's motion to quash and alternative request to stay or dismiss this case on the grounds of forum non conveniens, finding it had â€