Nunes v. Downey Brand LLP

Filed 8/1/06 Nunes v. Downey Brand LLP CA5

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 977.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

FIFTH APPELLATE DISTRICT

APPEAL from a judgment of the Superior Court of Merced County. Ronald W. Hansen, Judge.

Segal & Kirby and James R. Kirby II for Defendant and Appellant.

Lanahan & Reilley, Gigi M. Knudtson, Ellen C. Arabian, Martin Reilly and William Webb for Plaintiffs and Respondents.

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This is a suit by several dairy farmers who are or were members of a cooperative marketing association. When a local cheese manufacturing plant closed, the cooperative and some individual members, including some of the plaintiffs, arranged to purchase the plant with the understanding it would, in turn, buy all the cooperative's milk. Once the deal was completed, however, the plant and the cooperative failed to pay the farmers for their milk, and the farmers filed this suit against them. The suit alleged not only breach of the milk purchase agreement, but assorted additional claims for fraud, misrepresentation, and unfair business practices in connection with the purchase of the cheese plant. The plaintiffs subsequently amended the complaint to add more defendants, including the law firm that had prepared the prospectus for potential investors in the plant. The plaintiffs alleged, among other things, that the prospectus had failed to disclose that the principal organizer of the plant purchase had just agreed to plead guilty in federal court to charges of securities and mail fraud in relation to the operation of another cheese-making plant.

The law firm moved to strike the complaint as a â€