Opinion
B196641
9-8-2008
SITARA MANAGEMENT CORPORATION et al., Plaintiffs and Appellants, v. EQUILON ENTERPRISES LLC et al., Defendants and Respondents.
Law Office of Linton & Bogorad, Tanya K. Linton for Plaintiffs and Appellants. Quinn Emanuel Urquhart Oliver & Hedges, Kenneth R. Chiate, Marshall M. Searcy III, Kirsten Bird, Daniel C. Posner for Defendants and Respondents.
Not to be Published
This is an action for fraud brought by appellants Sitara Management Corporation (Sitara) and HJF, Inc. (HJF), a group of independent Shell gasoline service station dealers, against respondents Equilon Enterprises LLC (the Shell franchisor; hereinafter, Equilon) and several of its employees. In a prior appeal we affirmed the trial courts order granting respondents motion for a new trial (Value Gas, Inc. v. Equilon Enterprises LLC (Apr. 26, 2005, B169365 [nonpub. opn.]), and a second trial ensued that is the subject of the present appeal.
The gravamen of appellants complaint was that respondents had concealed and misrepresented the existence of a program which could have reduced the franchisees monthly rent to Equilon, thereby resulting in their overpayment of rent and the diminution of the goodwill value of their franchises. After the first trial, the jury awarded a total of approximately $ 72 million in compensatory and punitive damages. After the second trial, the jury awarded appellants only $220,000 in compensatory damages and awarded no punitive damages.
The sole issue in the present appeal is whether the trial court erred in granting five motions in limine precluding appellants from introducing certain evidence. Appellants contend that the rulings precluded the jury from considering evidence of respondents wrongdoing, including some evidence concerning their fraudulent acts, and that but for those rulings a more favorable result would have ensued, particularly as to punitive damages. We find the trial courts rulings were not an abuse of discretion and affirm the judgment.
FACTUAL AND PROCEDURAL SUMMARY
This lawsuit was initially filed in 2001. The case proceeded largely on a fraudulent misrepresentation claim, based on the failure of Equilon to disclose to the service station dealers a rent reduction program known as the Interim Rent Challenge (IRC). Failure to disclose the program kept the rent they paid to Equilon at a higher level and diminished the goodwill value of their franchises. Additionally, one of the service station dealers alleged a breach of contract in that Equilon failed to repair a persistent problem with his gasoline pump, which allegedly resulted in the loss of his franchise. The jury awarded against Equilon approximately $6 million in compensatory damages and $66 million in punitive damages. It also awarded $15,000 in exemplary damages against three Equilon employees (including $5,000 against Burke Albelda).
The trial court, however, granted a new trial based in part on the jurys use of an exhibit not admitted into evidence. The trial court also found the jurys calculation of compensatory damages incorrect and its punitive damages award excessive. In April of 2005, we affirmed the order granting a new trial.
In October of 2005, respondents moved for summary judgment against appellants on their cause of action for fraud and prayer for punitive damages. The trial court denied the motion and the motion for reconsideration.
In July of 2007, respondents brought seven motions in limine to exclude evidence. Respondents withdrew one motion (motion No. five), and the court denied another motion (motion No. seven). However, on September 1, 2006, the court granted the other five motions, either entirely or in part. Those five motions in limine are the subject of the present appeal and are addressed in detail in the discussion section hereinafter.
The second trial ensued and the jury returned a special verdict with the following findings: respondents Equilon and Albelda made a false representation of an important fact to appellants Sitara and HJF; respondents knew that the representation was false and made recklessly and without regard for its truth, and they intended that appellants rely on the representation; respondents intentionally failed to disclose an important fact that appellants did not know and could not have reasonably discovered; and appellants reasonably relied on the representation and their reliance was a substantial factor in causing them harm. On the claims for intentional misrepresentation, the jury awarded Sitara $123,760 and HJF $97,240 in compensatory damages. However, the jury found that appellants did not prove by clear and convincing evidence that respondents engaged in the misrepresentation with the malice, oppression, or fraud necessary to award punitive damages.
DISCUSSION
I. The standard of review.
The trial court is "vested with broad discretion in ruling on the admissibility of evidence." (Smith v. Brown-Forman Distillers Corp. (1987) 196 Cal.App.3d 503, 519; see People v. Rodrigues (1994) 8 Cal.4th 1060, 1124.) Generally, a trial courts ruling on a motion in limine will not be reversed on appeal absent a clear showing of abuse of discretion. (People v. Mincey (1992) 2 Cal.4th 408, 439.)
"`The appropriate test for abuse of discretion is whether the trial court exceeded the bounds of reason. When two or more inferences can reasonably be deduced from the facts, the reviewing court has no authority to substitute its decision for that of the trial court." (Walker v. Superior Court (1991) 53 Cal.3d 257, 272.) A court does not abuse its discretion as to factual findings if they are supported by substantial evidence. (Borissoff v. Taylor & Faust (2004) 33 Cal.4th 523, 531.)
Error in granting a motion in limine may be deemed reversible per se only to the extent the trial courts ruling is akin to a nonsuit in that it "`prevent[ed] plaintiffs from offering evidence to establish their case." (Tudor Ranches, Inc. v. State Comp. Ins. Fund (1998) 65 Cal.App.4th 1422, 1432-1433.) Reversal per se is appropriate only where the ruling "`completely foreclosed the plaintiffs from pursuing the only factual theory of liability supported by the evidence." (Id. at p. 1432, citing Kelly v. New West Fed. Sav. (1996) 49 Cal.App.4th 659, 667-668, 675.) In contrast, as in the present case, where none of the challenged evidentiary rulings foreclosed the essential theory of liability and the rulings simply precluded certain arguments or discrete items of evidence, the abuse of discretion standard applies. (Tudor Ranches, Inc. v. State Comp. Ins. Fund, supra, 65 Cal.App.4th at pp. 1432-1433.)
The burden is on appellants to establish an abuse of discretion. (Geffcken v. DAndrea (2006) 137 Cal.App.4th 1298, 1307.) Moreover, it is well established that even where evidence is improperly excluded, the error is not reversible unless it is reasonably probable that a result more favorable to the appellant would have been reached absent the error. (Tudor Ranches, Inc. v. State Comp. Ins. Fund, supra, 65 Cal.App.4th at pp. 1431-1432.)
II. The trial court did not abuse its discretion in excluding evidence of appellants rent payments after December 20, 1999 (motion in limine No. 1).
The trial court granted respondents first motion in limine, which was based on Evidence Code sections 350 and 352, to the extent that the court precluded evidence of rent payments made after December 20, 1999.
As stated in its ruling, the court found that the evidence was "not reasonably subject to dispute" that Ms. Shaila Mantri (the principal for Sitara and HJF) first found out about the Interim Rent Challenge (IRC) procedure, "albeit perhaps by a different name, in Fall 1999." The court noted that in opposition to a prior motion for summary adjudication, appellants had relied on Mantris declaration (also before it on the motion in limine) wherein Mantri stated that she was aware of a rent challenge in the fall of 1999, and that she apparently inquired about an appraisal at that time.
Thus, because Mantri knew of the existence of the IRC after the fall of 1999 (i.e., sometime after December 20, 1999), she could not have reasonably relied on any fraudulent misrepresentations by respondents about the existence of that program after that date. Therefore, the trial court found that evidence of rent payments after that date was irrelevant, and it precluded the introduction of such evidence.
The significance of limiting such evidence was that it limited the damages that could be recovered. As urged by respondents, damages claimed by appellants would thus be limited to the difference between the amount of rent paid, from the time the IRC began until the fall of 1999, and the amount of rent appellants would have paid under the IRC during this same time.
The trial court did not abuse its discretion in effectively precluding evidence of damages after fall of 1999 because by that time Mantri knew of the rent reduction program. In reaching that conclusion, the trial court considered Mantris trial testimony at the prior trial, sworn interrogatory responses, Mantris deposition testimony and her declaration, which appellants attached to their opposition to the motion in limine.
In opposition to the motion for summary adjudication, Mantri declared: "By the fall of 1999, I was still unaware of the IRC [by name]. At that time I was aware of the possibility of some sort of a rent challenge only [because of a] conversation with another dealer." Likewise, appellants responded as follows to an interrogatory question: "[Appellants] cannot recall the exact date [they] found out about the Interim Rent Challenge, but believe[] it was in the fall of 1999 when Mrs. Mantri found out about the Interim Rent Challenge [program] from another Shell-branded lessee-dealer." Similarly, Mantri specifically acknowledged in her testimony at the first trial that she "learned about the rent program in the fall of 1999, the Interim Rent Program," but did not pursue it at that time. Accordingly, substantial evidence based on Mantris own admissions supports the trial courts conclusion that she knew of the IRC by fall of 1999.
Appellants argue that Mantris declaration indicated she actually did not know of the name of the rent program, that her concern about a rent challenge and an appraisal had nothing to do with the IRC but related to the possible improper use of leased property, that she never learned of the rent program from Equilon or its employees, that she first learned of the IRC as a result of related other litigation in the summer of 2001, and that it was a "big question mark" as to whether Mantri was properly informed by Equilon and affirmatively chose not to exercise the right to seek lower rents. However, it is of no consequence whether Mantri knew the proper name of the rent reduction program or what her specific business concerns were at that time. Nor does it matter who advised Mantri of the program. The critical fact is simply that Mantri learned of the rent reduction program by the fall of 1999.
The IRC rent reduction program was an informal procedure created by Equilon to address situations in which a dealer complained that it was paying contract rent under an old Shell lease that was higher than the market value rent Equilon would include in its new leases. Equilon did not formally name the program the "IRC" and did not even refer to it by that name in the key internal documents that disseminated information about its creation and terms. What matters for the purposes of evaluating whether Mantri was aware of the IRC was not whether she knew of it by its name or how she knew of it, but rather whether she knew of its existence. The unequivocal evidence establishes that she did know of its existence by fall of 1999. As the trial court aptly stated, Mantri knew of the IRC by fall of 1999, "albeit perhaps by a different name."
Because Mantri knew of the IRC by fall of 1999, her reliance on any misrepresentations made about the IRC after that time could not have been reasonable. (See Carpenter v. Hamilton (1936) 18 Cal.App.2d 69, 71.) In turn, because Mantri could not have justifiably relied on any misrepresentations about the IRC after fall of 1999, appellants could not have recovered damages on a fraud claim for rent overpayments made after fall of 1999. (See Lazar v. Superior Court (1996) 12 Cal.4th 631, 638 [justifiable reliance is one of the requisite elements of fraud].)
Accordingly, because appellants were not entitled to postfall 1999 compensatory damages, evidence of rent payments made after December 20, 1999, was not relevant (Evid. Code, § 350) and was properly precluded by the trial court, which did not abuse its discretion in ruling on the motion in limine.
III. The trial court did not abuse its discretion in precluding evidence of alleged "lost goodwill" damages as to the North Hollywood station and the fact of nonrenewal of that station in 2004 (motion in limine No. 2).
The trial court also granted respondents second motion in limine and excluded evidence or argument in support of (1) the alleged loss of goodwill at appellants Simi Valley and Woodland Hills stations, (2) the 2004 nonrenewal of the North Hollywood station, and (3) the alleged loss of goodwill at the North Hollywood station. In regard to the Simi Valley and Woodland Hills stations, respondents argued that goodwill damages were not available because those stations continued to operate and no such losses had occurred; appellants do not challenge that aspect of the trial courts ruling.
No damages flowing from the nonrenewal of the North Hollywood station.
Regarding the North Hollywood station, respondents argued that the nonrenewal of Sitaras lease in 2004 was the result of Equilons loss of its underlying ground lease at the property, and that such closure had no bearing on Sitaras fraud claim which was premised on overpayments in the months after Equilon was formed in 1998. Indeed, when Equilon lost its ground lease for the property where the North Hollywood station was located, it had no property to lease to Sitara and gave proper written notice of nonrenewal for reasons unrelated to any allegations of fraud. Thus, any evidence of or argument about the nonrenewal of the North Hollywood station and its alleged loss of goodwill would be either not relevant (Evid. Code, §§ 210, 350), or would have marginal relevance far outweighed by the danger of unfair prejudice and undue expenditure of time (Evid. Code, § 352), as respondents properly argued to the trial court. Accordingly, the trial court was well within its discretion in excluding evidence of the nonrenewal of the North Hollywood station.
Sitara was not entitled to goodwill damages.
Moreover, the trial court properly excluded evidence of alleged lost goodwill damages at the North Hollywood station because Sitara had no basis on which to claim such damages and failed to timely disclose that it was claiming such damages.
Lost goodwill damages are available only where such losses are the natural and proximate result of the defendants tortious conduct. (See Dallman Co. v. Southern Heater Co. (1968) 262 Cal.App.2d 582, 593-596.) Here, it is apparent that the closure of the North Hollywood station in 2004 had nothing to do with Sitaras alleged rent overpayments in 1999. Appellants simply assume that the nonrenewal in 2004 resulted from the alleged fraudulent conduct of respondents, but they fail to actually establish any proximate causation between the fraud complained of and the closure of the North Hollywood station. Thus, the trial court did not abuse its discretion in precluding such evidence because it was it was not relevant or, at best, marginally relevant and potentially confusing, time consuming, and unduly prejudicial. (Evid. Code, §§ 350, 352.)
Moreover, as respondents also urged, Sitara did not properly disclose evidence of alleged lost goodwill damages during pretrial discovery, and for that additional reason such evidence may be properly limited by the trial court. (See Universal Underwriters Ins. Co. v. Superior Court (1967) 250 Cal.App.2d 722, 729-730.) Because appellants failed to identify in their supplemental interrogatory responses lost goodwill as a basis for alleged damages, they "`set at rest" that issue. (Campain v. Safeway Stores, Inc. (1972) 29 Cal.App.3d 362, 366.) Their failure to disclose an intention to seek goodwill damages is thus another valid reason supporting the trial courts exclusion of such evidence.
Accordingly, the trial court did not abuse its broad discretion in granting the second motion in limine.
IV. The trial court did not abuse its discretion in excluding evidence of Equilons Strategic Marketing Initiative (SMI) and related market studies (motion in limine No. 3).
In its third motion in limine, respondents sought to exclude evidence of the SMI and related market studies that Equilon conducted after its formation to analyze the retail market for motor fuel. In the prior trial, appellants attempted to show that Equilon concluded in the market studies that the lessee-dealers as a group were not economically viable for the company and that, therefore, the marketing studies evidenced Equilons fraudulent intent to drive lessee-dealers, such as appellants, out of business. Prior to the trial in the present case, respondents moved to exclude such argument and evidence on the grounds that (1) collateral estoppel barred that argument and (2) such evidence was irrelevant and unduly prejudicial. The trial court granted the motion in limine because the issue of whether Equilon intended to decrease the number of dealer-owned service stations had already been raised and decided by another court (see Coast Village, Inc. v. Equilon Enterprises, LLC (C.D.Cal. 2001) 163 F.Supp. 2d 1136, 1152-1159 (Coast Village)), collaterally estopping appellants from relitigating the issue.
A. Collateral estoppel.
Collateral estoppel bars relitigation of an issue decided at a previous hearing if the issue necessarily decided at the previous proceeding is identical to the one which is sought to be relitigated. (Amador v. Unemployment Ins. Appeals Bd. (1984) 35 Cal.3d 671, 684; Southwell v. Mallery, Stern & Warford (1987) 194 Cal.App.3d 140, 144.) "If `anything is left to conjecture as to what was necessarily involved and decided there can be no collateral estoppel." (Eichler Homes, Inc. v. Anderson (1970) 9 Cal.App.3d 224, 234; see also Southwell v. Mallery, Stern & Warford, supra, 194 Cal.App.3d at p. 144 .)
Here, although the causes of action in Coast Village, supra, 163 F.Supp. 2d 1136, were different than those in the present case, appellants acknowledge that in both cases the "issue is the intent of Equilon. The issue is whether Equilon [intentionally] planned to de-emphasize dealer-owned stations, to decrease their number." On the issue of intent, the court in Coast Village held, in pertinent part, as follows: "[T]he combined evidence of the [marketing studies] does not demonstrate any bad faith intent on Equilons part, or an overarching purpose of converting the entire [lessee-dealer] class of trade to company-operated outlets. If anything, the [marketing studies] evidence . . . that Equilon engaged in deliberate and rational decision-making, conducted numerous studies, and compiled detailed market analyses before making upgrades, conversions, and/or divestments on a site-by-site basis. This was a classic example of the exercise of reasonable business judgment on the part of . . . Equilon . . . . [¶] The court therefore finds that neither the [marketing studies] nor the loss of [lessee-dealer] stations is indicative of bad faith." (Coast Village, supra, 163 F.Supp. 2d at p. 1159.)
Thus, the issue of whether the marketing studies evidence Equilons intent to drive its lessee-dealers out of business was actually litigated and necessarily decided in Coast Village. As the trial court herein aptly noted, quoting the court in Coast Village, supra, at page 1155, "it was not the purpose of [the Strategic Marketing Initiative] to substantially decrease the number of [lessee-dealer stations] within the overall network." Although appellants urge that the full spectrum of facts concerning the alleged fraudulent conduct of Equilon was not presented in Coast Village federal action, all the facts need not be identical for collateral estoppel to apply. All that is required is that the parties be the same (or in privity), and that issue in the former proceeding be identical, actually litigated, and necessarily and finally decided in that former proceeding. (Gikas v. Zolin (1993) 6 Cal.4th 841, 849.)
All the elements of collateral estoppel were met, and the trial court did not abuse its discretion in applying the doctrine to bar appellants from relitigating their argument that the marketing studies evidenced Equilons bad-faith intent to drive them out of business.
B. Relevance and prejudicial effect.
The trial court addressed only the collateral estoppel issue and thus did not find it necessary also to rule on respondents additional contention that evidence of the SMI and related market studies were irrelevant and unduly prejudicial. (Evid. Code, §§ 210, 350, 352.) It is similarly unnecessary to address on appeal this additional or alternative basis for granting the motion in limine.
V. The trial court did not abuse its discretion by excluding testimony from the dismissed plaintiffs (motion in limine No. 4).
In the fourth motion in limine, respondents sought to exclude testimony about alleged fraudulent representations made by Equilon not to appellants, but to plaintiffs who had been dismissed from the case before trial. Equilon argued that such testimony, even if marginally relevant to the issue of whether Equilon made fraudulent representations to appellants, would be unduly prejudicial to Equilon, result in jury confusion, and unnecessarily lengthen the trial by creating a series of "mini-trials" about those other situations involving other witnesses and former parties. The trial court granted the motion "to preclude former plaintiffs in this case from testifying about their own fraud allegations against [respondents.]"
Appellants rely on Evidence Code section 1101 to argue that evidence of fraudulent acts allegedly committed by Equilon against dealers other than appellants is admissible because such evidence is probative of Equilons intent to defraud appellants. As noted by appellants, intent is not only an element in the cause of action for fraud, but also is an element of fraud as the basis for punitive damages. (Civ. Code, § 3294, subd. (c)(3).) Pursuant to Evidence Code section 1101, subdivision (a), "evidence of a persons character or a trait of his or her character . . . is inadmissible when offered to prove his or her conduct on a specified occasion," except that evidence is admissible "that a person committed a crime, civil wrong, or other act when relevant to prove some fact (such as . . . intent, . . .) other than his or her disposition to commit such an act." (Id. at subd. (b).)
Thus, appellants argument based on Evidence Code section 1101 is that testimony about "other bad acts," such as alleged fraudulent statements made by Equilon to dealers other than appellants, "is admissible if [it] is relevant to prove [Equilons] intent." However, as explained in Robinson v. Superior Court (1986) 181 Cal.App.3d 746, 750, "it is elementary" that evidence of other bad acts that falls within the section 1101, subdivision (b) exception is not automatically admissible. Rather, such evidence still "is subject to section 352 of the Evidence Code under which the trial court may exclude relevant evidence if its probative value is outweighed by its prejudicial effect [citation] or if its admission will necessitate undue consumption of time." (Ibid.)
In the present case, when analyzed under Evidence Code section 352, the trial court did not abuse its discretion in excluding testimony by the dismissed plaintiffs, even if such testimony was admissible under section 1101, subdivision (b) and was minimally relevant. The risk of undue prejudice was that the jury could have been misled in concluding that Equilon must have advised Mantri that there was nothing she could do to lower the rent, because Equilon allegedly had said the same thing to other lessee-dealers. The jury would have been exposed to testimony from only some witnesses selectively chosen from the larger universe of Equilon lessee-dealers who had sued Equilon for fraud related to the alleged nondisclosure of the IRC. Most significantly, such selected testimony from other lessee-dealers could have entailed a series of mini-trials, with Equilon potentially bringing in third parties to testify about what those former plaintiffs were told regarding the IRC, or establishing they were ineligible to participate in the IRC.
Accordingly, given the arguably minimal probative value of such testimony from the dismissed plaintiffs and the potential for undue prejudice and consumption of time, the trial court did not abuse its broad discretion in granting the motion in limine.
VI. The trial court did not abuse its discretion by excluding evidence of Equilons alleged interference with the sales of appellants stations (motion in limine No. 6).
Finally, appellants complain that the trial court erred in granting respondents sixth motion in limine, to the extent that the court precluded "evidence or argument that Equilon blocked or discouraged the sale or transfer of [appellants] stations or otherwise wrongfully interfered with potential sales, including by dissuading potential purchasers from purchasing [appellants] stations."
Respondents argued that evidence of such conduct was irrelevant and, if admitted, would be wasteful of time and resources, confusing to the jury, and unduly prejudicial. Respondents also moved to exclude such evidence on the ground that appellants had previously asserted claims in another lawsuit based on the allegation that Equilon had interfered with the sale of Sitaras North Hollywood station, and that principles of res judicata barred them from relitigating the same claims herein and seeking the same damages. The trial court ruled that res judicata barred appellants from relitigating their business interference claim in the present case, and we agree.
A. Principles of Res Judicata and the Primary Rights Doctrine.
"`Res judicata describes the preclusive effect of a final judgment on the merits." (Mycogen Corp. v. Monsanto Co. (2002) 28 Cal.4th 888, 896.) "Under this doctrine, all claims based on the same cause of action must be decided in a single suit; if not brought initially, they may not be raised at a later date." (Id. at p. 897.)
"Res judicata applies if (1) the judgment in the prior proceeding is final and on the merits; (2) the present proceeding is on the same cause of action as the prior proceeding; and (3) the parties in the present proceeding or parties in privity with them were parties in the prior proceeding." (Federation of Hillside & Canyon Assns. v. City of Los Angeles (2004) 126 Cal.App.4th 1180, 1202; see also Busick v. Workmens Comp. Appeals Bd. (1972) 7 Cal.3d 967, 974.) The doctrine of res judicata not only bars litigation of matters that actually were litigated in the prior action, but also those matters that could have been litigated in that action. (Busick, at p. 975.)
For purposes of res judicata, the term "cause of action" refers neither to the legal theory asserted by a plaintiff nor to the remedy the plaintiff seeks. (Mycogen Corp. v. Monsanto Co., supra, 28 Cal.4th at pp. 904; Slater v. Blackwood (1975) 15 Cal.3d 791, 795-796 (Slater).) Instead, "California has consistently applied the `primary rights theory, under which the invasion of one primary right gives rise to a single cause of action." (Slater, supra, 15 Cal.3d at p. 795.) As the California Supreme Court explained, "The primary right theory is a theory of code pleading that has long been followed in California. It provides that a `cause of action is comprised of a `primary right of the plaintiff, a corresponding `primary duty of the defendant, and a wrongful act by the defendant constituting a breach of that duty. [Citation.] The most salient characteristic of a primary right is that it is indivisible: the violation of a single primary right gives rise to but a single cause of action. [Citation.] . . . [¶] As far as its content is concerned, the primary right is simply the plaintiffs right to be free from the particular injury suffered. [Citation.]" (Crowley v. Katleman (1994) 8 Cal.4th 666, 681.) A particular injury might be compensable under multiple legal theories and might entitle a party to several forms of relief; nevertheless, it will give rise to only one cause of action. (Id. at pp. 681-682.) Basically, one injury can give rise to only one claim for relief. (Ibid.)
B. A prior related case involved the same primary right as in the present case.
As previously discussed, appellants had also sued Equilon in the Coast Village case, litigation which included a federal statutory claim under the Petroleum Marketing Practices Act and state law pricing claims. After that case was dismissed, in April of 2002 appellants refiled their state law claims and pleaded other claims in a new state court action, Jerrys Shell v. Equilon Enterprises LLC (Super. Ct. L.A. County, BS271208) (Jerrys Shell). In Jerrys Shell, appellants raised claims for interference with prospective economic advantage and violations of franchise rights (Bus. & Prof. Code, §§ 21140 et seq.). Those claims were based, in pertinent part, on Equilons alleged interference with the sale of appellants stations. In May of 2004, the trial court dismissed those claims when it dismissed the entire case as a terminating sanction for repeated discovery violations. In December of 2005, the matter was affirmed on appeal. (See Jerrys Shell v. Equilon Enterprises, LLC (2005) 134 Cal.App.4th 1058.)
Such a dismissal for noncompliance with discovery orders operates as a judgment on the merits on the causes of action appellants raised in Jerrys Shell. (See Kahn v. Kahn (1977) 68 Cal.App.3d 372, 383.) And, appellants do not dispute that the parties in the prior and present lawsuits are the same. Thus, the sole issue is whether appellants claims in the two cases constitute the same "cause of action," within the meaning of the res judicata doctrine.
Here, the trial court properly concluded that appellants claims in the respective cases regarding Equilons alleged interference with the sale of Sitaras station sought to vindicate the same primary right in both cases. Specifically, appellants admit that in Jerrys Shell, they claimed that "from 1998 to 2001 they engaged in significant efforts to sell their stations," but that Equilon "dissuaded the purchasers." Appellants alleged that as a result, they "lost the sales to [the prospective] purchasers" and were "substantially damaged." Similarly, in the present case appellants contend the trial court denied them the opportunity to argue that in 1998, Sitara "agreed with a purchaser . . . for [the] sale of the North Hollywood station," but that Albelda "on behalf of Equilon approached [the prospective purchaser] and stated that the station could not be profitably managed, given the high rents."
Accordingly, the primary right appellants sought to vindicate in both cases concerned Equilons alleged improper efforts to dissuade purchasers from buying their stations. Because the Jerrys Shell case had already been adjudicated on the merits of appellants claim based on the same primary right, appellants cannot now relitigate that same primary right as an element of their fraud claim in the present case. Appellants effort to shift the focus to whether the matter is governed by collateral estoppel is misplaced. Under the applicable theory of res judicata, the trial court did not abuse its discretion in granting the motion in limine and precluding evidence of and argument about respondents alleged interference with the sale of the North Hollywood station.
It is thus unnecessary to address respondents additional argument that evidence of their alleged interference with Sitaras sale of the North Hollywood station was irrelevant to appellants fraud claim, or that its minimal probative value was outweighed by the risk that evidence of respondents unrelated and unproven misconduct would have unduly prejudiced respondents. (Evid. Code, §§ 350, 352.)
DISPOSITION
The judgment is affirmed.
We concur:
DOI TODD, J.
ASHMANN-GERST, J.
It is also unnecessary to address respondents assertion of harmless error, as we find no error in the trial courts exercise of its discretion regarding any of the motions in limine about which appellants complain.