Opinion
A155389
12-19-2019
LEERINK REVELATION HEALTHCARE FUND I, L.P., et al., Plaintiffs and Respondents, v. BALAJI K. SRINIVASAN, Defendant and Appellant.
ORDER MODIFYING OPINION AND DENYING REHEARING
[NO CHANGE IN JUDGMENT]
THE COURT:
It is ordered that the opinion filed herein on December 19, 2019, be modified as follows:
On page 11, delete the first portion of footnote 7 beginning "Respondents drafted the SPAs and," so that the footnote reads:
According to respondents' managing partner Zachary Scott, "[t]he ROFR Condition in the SPAs was included at our insistence because we wished to protect ourselves against a situation where the eligible investors
with right of first refusal rights undertook a massive exercise of those rights leaving only a de minimis number of shares to purchase. Our investment goals and strategies dictate that we are not interested in a relatively small number of shares and would not have offered to buy them in the first place."
The petition for rehearing is denied.
There is no change in judgment. Dated:__________
/s/_________
Kline, P.J.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (San Francisco County Super. Ct. No. CGC-18-567740)
Appellant Balaji K. Srinivasan appeals the trial court's order granting the application of respondents Leerink Revelation Healthcare Fund I, L.P. and Leerink Revelation Healthcare Fund II, L.P. to extend a previously ordered writ of attachment against appellant in the amount of $4,723,811.72, pending trial. On appeal, appellant contends the court erred when it found that respondents were likely to prevail at trial on their cause of action for breach of contract, which is based on an agreement between the parties for the sale of appellant's shares of common stock in Counsyl, Inc. (Counsyl), a genetics and DNA testing company, to respondents. We will reverse the order for the reasons explained in this opinion.
FACTUAL AND PROCEDURAL BACKGROUND
In 2007, appellant cofounded Counsyl, for which he served as president from 2007 to 2012. Beginning in 2012, appellant stopped receiving a salary from Counsyl, but continued to serve as a community advisor.
Respondents are Delaware limited partnerships that invest in healthcare-related companies that develop medical devices, biopharmaceuticals, diagnostics, healthcare information technology, and healthcare services.
During his tenure at Counsyl, appellant received 5,760,746 shares of Counsyl common stock. Appellant's rights and obligations as a shareholder were governed by certain contracts, including a "Restricted Stock Purchase Agreement," dated October 24, 2007, which provides that Counsyl has the right of first refusal to buy any stock an investor proposes to sell to a third party, and a "Third Amended Right of First Refusal and Co-Sale Agreement" (ROFR Agreement), dated May 5, 2014, which provides Counsyl and certain other eligible investors with a right of first refusal as to any stock an investor wishes to sell to a third party (ROFR Rights).
On May 9, 2018, after several months of negotiations, appellant and respondents entered into two "Securities Purchase Agreements" (SPAs), the terms of which are identical except that the buyer in one SPA is Leerink Revelation Healthcare Fund I, L.P. and the buyer in the other SPA is Leerink Revelation Healthcare Fund II, L.P. Under the SPAs, each fund was to receive 2,880,373 shares of Counsyl common stock at $2.00 per share, resulting in an aggregate purchase by respondents of 5,760,746 shares for an aggregate price of $11,521,492. The closing date for the purchase of appellant's shares was to be on or before July 31, unless otherwise agreed to by the parties.
The SPAs also provided that respondents would pay an additional $1.00 per share in the event of Counsyl's initial public offering, subject to certain restrictions.
The SPAs contain a bilateral condition (the ROFR Condition) which, to be satisfied, requires expiration of certain periods set forth in the 2007 Restricted Stock Purchase Agreement and the 2014 ROFR Agreement, without Counsyl and/or its eligible investors exercising their ROFR Rights to purchase the shares at the same price agreed on with respondents. (SPAs, §§ 4.21(d), 4.22(d).) If the condition was not satisfied, either party could withdraw from the agreements. (Ibid.)
On May 9, 2018, the same date the SPAs were executed, appellant sent notices to Counsyl and the eligible investors informing them of his planned sale of stock to respondents and of the notice recipients' opportunity to exercise their ROFR Rights. Aarin Capital, one of the eligible investors, contacted appellant on May 14, 2018, to discuss the terms of the proposed sale. Aarin Capital had first contacted appellant in March 2018, after receiving the initial notice regarding the stock he then proposed to sell to respondents. On May 28, 2018, Counsyl announced that it was being acquired by Myriad Genetics, Inc. (Myriad). With the Myriad acquisition, Counsyl stock was valued at $2.82 per share. On June 1, 2019, following the announcement of the Myriad acquisition, appellant asked respondents to terminate the SPAs by mutual consent, but respondents refused to do so.
These were revised notices. On February 28, 2018, after the parties apparently executed a letter of intent, appellant had sent notices to Counsyl and eligible investors containing pricing terms that the parties subsequently altered before entering into the SPAs.
Also on June 1, 2018, Aarin Capital provided written notice to appellant and Counsyl stating that it was exercising its ROFR Right to purchase 125,000 shares of appellant's Counsyl stock at respondents' proposed price of $2.00 per share. On June 4, appellant provided respondents with Aarin Capital's notice of ROFR exercise.
A June 7, 2018 document entitled "Letter Agreement" provides that appellant and "Eligible Investor," apparently meaning Aarin Capital, agreed to enter into a share purchase agreement to consummate the sale of appellant's Counsyl shares "by August 31, 2018, or by any such later date as may be mutually agreed to by the undersigned parties." This document is signed only by appellant.
Following Counsyl's notice regarding the Myriad acquisition, Counsyl informed shareholders of record that the deadline to make their election to receive cash or Myriad stock in exchange for their Counsyl stock would be June 14, 2018. On June 13, appellant submitted his shareholder consent form to Counsyl, electing to receive cash for his Counsyl shares. On June 14, respondents sent letters to appellant and Counsyl, attempting to close the transaction and directing appellant to elect to receive Myriad stock rather than cash. Respondents also cited sections of the SPAs that required appellant to use his reasonable best efforts to complete the sale of stock to respondents.
On June 15, 2018, Counsyl responded to respondents' letter, stating that appellant was the record owner of his shares and that respondents could not make an election to receive Myriad stock. In a June 19 letter to Aarin Capital, appellant asked Aarin Capital to rescind its ROFR exercise and waive its ROFR Right with respect to appellant's Counsyl shares, while noting that Aarin Capital was "not obligated to accept [his] request."
On June 29, 2018, respondents filed a complaint against appellant, Counsyl, Myriad, and Aarin Capital, seeking specific performance of the SPAs and declaratory relief establishing their right to elect stock in the Myriad acquisition. On July 17, respondents filed a first amended complaint in which they added Fortis Advisors, LLC (the shareholder representative in the Myriad acquisition) as a defendant.
On July 18, 2018, respondents filed an ex parte application for a temporary restraining order (TRO) and order to show cause re preliminary injunction, requesting emergency relief to prevent appellant from exchanging his Counsyl stock for cash consideration for the Myriad acquisition.
At a July 24, 2018 hearing, the trial court denied respondents' application for a TRO, but also stated that it was "real troubled by what [appellant] did. The [ROFR] agreement seems to say payment needs to be made [by an eligible investor] within ten days. And it seemed pretty clear it wasn't. It looks like a breach. When something looks like a breach, and the damages are readily ascertainable, we're outside of TROs and inside attachments." The court then said it was persuaded that respondents had shown a probability of success against appellant, and continued the hearing to give respondents the opportunity to file an attachment request, if they so wished.
On July 26, 2018, respondents filed an ex parte request to file a second amended complaint, adding causes of action for breach of contract and breach of the implied covenant of good faith and fair dealing. The court granted the request to file the second amended complaint on July 30, and the second amended complaint was filed on August 7, 2019.
On July 27, 2018, respondents filed an ex parte application for a writ of attachment. At the July 30 hearing on the application, after the court indicated that it was inclined to grant the writ, appellant's counsel stated that appellant would be willing to stipulate to a temporary attachment. The parties then stipulated to a temporary writ of attachment, set to expire on August 20, in the amount of $4,723,811.72, which was the difference between the purchase price of the Counsyl shares ($11,521,492) agreed to in the SPAs and the new value of those shares ($16,245,303.72) after the Myriad acquisition.
On August 16, 2018, respondents filed an application for an order to extend and/or modify the writ of attachment.
On August 31, 2018, following a hearing, the court entered an order granting respondents' application to extend the writ of attachment pending trial, but denying their request to modify or enlarge the amount of funds subject to attachment.
On September 6, 2018, appellant filed a notice of appeal from the court's August 31 order.
DISCUSSION
Appellant contends the court erred when it granted respondents' application to extend the writ of attachment, based on an incorrect interpretation of the ROFR Condition in the SPAs, the language of which was based on identical language in the 2014 ROFR Agreement.
I. Relevant Terms of the SPAs and the ROFR Agreement
Part 2 of the ROFR Agreement, entitled "Restrictions on Transfer," provides that before selling any shares of Counsyl stock, an investor (or "seller") must provide written notice of the planned transfer (or "transfer notice") to Counsyl (or "the Company") and other eligible investors informing them of the seller's intention to transfer a specific number of shares to a specific buyer at an agreed upon price. The notice must also inform Counsyl and each eligible investor of the "right to exercise either [their] Right of First Refusal or its Right of Co-Sale . . . with respect to the offered shares . . . ." (ROFR Agreement, § 2.2.)
The right of co-sale, discussed in part 4 of the ROFR Agreement, is not directly relevant to the present circumstances. (See ROFR Agreement, §§ 4.1-4.6.)
Part 3 of the ROFR Agreement, entitled "Right of First Refusal," discusses the timing and procedures required for Counsyl and other eligible investors to buy the seller's shares pursuant to their ROFR Rights.
Section 3.1 of the ROFR Agreement, entitled "Exercise by the Company," provides that the "Initial Exercise Period" runs for 20 days after the last date the seller's transfer notice is deemed to have been delivered to Counsyl and all eligible investors. (ROFR Agreement, § 3.1(a).) Section 3.2, entitled "Initial Exercise by the Eligible Investors"—the section applicable to the present case—provides that in order to exercise its right to purchase any of a seller's shares, an eligible investor "must provide written notice delivered to Seller within the Initial Exercise Period." (ROFR Agreement, § 3.2(a).) Section 3.2 further provides that, within five days "after the expiration of the Initial Exercise Period," the seller must give written notice to Counsyl and each eligible investor specifying the number of shares "to be purchased by the Company and each Eligible Investor exercising its Right of First Refusal (the ' ROFR Confirmation Notice ')." (ROFR Agreement, § 3.2(c).)
Section 3.3 of the ROFR Agreement, entitled "Subsequent Exercise by the Eligible Investors," discusses the two exercise periods—initial and subsequent—contained in the ROFR Agreement. Under section 3.3, "[t]o the extent that there remain any Unsubscribed Shares, each Eligible Investor electing to exercise its right to purchase at least its full Pro Rata ROFR Share" during the Initial Exercise Period under section 3.2 (a "Participating Investor") will then "have a right to purchase all or any part of the Unsubscribed Shares." (ROFR Agreement, § 3.3.) Section 3.3 further provides: "In order to exercise its rights hereunder, such Electing Participating Investor must provide written notice to Seller with a copy to the Company and each Eligible Investor within seven (7) days after the expiration of the Initial Exercise Period (the ' Subsequent Exercise Period ')." (Ibid.)
Finally, section 3.5 of the ROFR Agreement, entitled "Closing; Payment," provides in relevant part that "the Company and the Eligible Investors exercising their Rights of First Refusal shall effect the purchase of all or any portion of the Offered Shares, including the payment of the purchase price, within ten (10) days after the later of (i) delivery of the ROFR Confirmation Notice . . . , [or] (iii) expiration of the Subsequent Exercise Period . . . (the ' Right of First Refusal Closing '). . . . At such Right of First Refusal Closing, Seller shall deliver to each of the Company and the Eligible Investors exercising their Rights of first Refusal, one or more certificates, properly endorsed for transfer, representing such Offered Shares so purchased." (ROFR Agreement, § 3.5.)
The SPAs specifically address the possibility that Counsyl and eligible investors could exercise their ROFR Right with respect to the shares appellant had agreed to sell to respondents. Part 4 of the SPAs lists the various "Closing Conditions" for both appellant and respondents. Section 4.1, which addresses appellant's obligations as the seller, provides in relevant part:
"4.1. Buyer's Conditions. The obligations of Buyer to consummate the transactions contemplated by this Agreement at the Closing with respect to the Securities to be transferred at the Closing are subject to the satisfaction of the following conditions (unless waived in writing by Buyer) and Seller shall use all reasonable efforts to cause each such condition to be satisfied as soon as reasonably practicable: [¶] . . . [¶]
"(d) Right of First Refusal. The right of first refusal exercise period under Restricted Stock Purchase Agreement dated October 24, 2007 and the Third Amended and Restated Right of First Refusal and Co-Sale Agreement dated May 5, 2014 (the 'ROFR Agreements') shall have expired without any Eligible Investor (as defined in the Third Amended and Restated Right of First Refusal and Co-Sale Agreement dated May 5, 2014) or the Company [i.e., Counsyl] exercising any of their respective rights of first refusal thereunder with respect to the Securities in connection with the transactions contemplated by this Agreement (the 'ROFR Rights'), provided that the condition set forth in this Section 4.1(d) shall be deemed satisfied on such earlier date on which (x) all Eligible Investors and the Company have executed and delivered a written waiver of their ROFR Rights or (y) the ROFR Rights are terminated pursuant to Sections 7(G) and 7.1 of the ROFR Agreements, as the case may be. The condition set forth in this Section 4.1(d)) is referred to as the 'ROFR Condition.' "
The 2007 Restricted Stock Purchase Agreement, separately applicable only to Counsyl's exercise of its right of first refusal, includes a 30-day period following Counsyl's receipt of a seller's proposed transfer notice during which Counsyl may exercise its right of first refusal to purchase all of the shares proposed to be sold. (Restricted Stock Purchase Agreement, § 7.) Both appellant and respondents note that the terms of this agreement are inapplicable and thus irrelevant to the issues raised on appeal.
Section 7.1 of the ROFR Agreement, which sets forth the events that would cause termination of eligible investors' ROFR Rights, is not relevant here.
Section 4.2 of the SPAs, which addresses respondents' obligations as the buyers, provides in relevant part: "Seller's Conditions. The obligations of Seller to consummate the transaction contemplated by this Agreement at the Closing with respect to the Securities to be transferred at the Closing are subject to the satisfaction of the following conditions (unless waived in writing by Seller) and Buyer shall use all reasonable efforts to cause each such condition to be satisfied as soon as reasonably practicable: [¶] . . . [¶]
"(d) Right of First Refusal. The ROFR Condition shall have been satisfied."
II. Applicable Legal Principles
" ' "Attachment is an ancillary or provisional remedy to aid in the collection of a money demand by seizure of property in advance of trial and judgment." ' [Citation.] California's Attachment Law (Code Civ. Proc., § 482.010 et seq.) is purely statutory and is strictly construed. [Citation.]" (Kemp Bros. Construction, Inc. v. Titan Electric Corp. (2007) 146 Cal.App.4th 1474, 1476.) "Attachment is a harsh remedy because it causes the defendant to lose control of his property before the plaintiff's claim is adjudicated." (Martin v. Aboyan (1983) 148 Cal.App.3d 826, 831.)
"Except as otherwise provided by statute, an attachment may be issued only in an action on a claim or claims for money, each of which is based upon a contract, express or implied, where the total amount of the claim or claims is a fixed or readily ascertainable amount not less than five hundred dollars ($500) exclusive of costs, interest, and attorney's fees." (Code Civ. Proc., § 483.010, subd. (a).) The court shall issue a right to attach order only if it finds, inter alia, that "the plaintiff has established the probable validity of the claim upon which the attachment is based." (§ 484.090, subd. (a)(2).) "A claim has 'probable validity' where it is more likely than not that the plaintiff will obtain a judgment against the defendant on that claim." (§ 481.190.)
All further statutory references are to the Code of Civil Procedure unless otherwise indicated.
"The purpose of a writ of attachment is to ensure payment will be recovered if judgment is entered. [A plaintiff] is only required to establish the 'probable validity' of its claims. Whether [the plaintiff's] claims are 'actually valid' is determined in a subsequent proceeding and not affected by the court's order on the application for prejudgment attachment. (§ 484.050, subd. (b).)" (Santa Clara Waste Water Co. v. Allied World National Assurance Co. (2017) 18 Cal.App.5th 881, 889; see also § 484.100 [court's findings in attachment proceeding have no effect at trial of main action and may not be received as evidence in that trial].)
An order granting an application for a prejudgment attachment is directly appealable. (§ 904.1, subd. (a)(5).)
On appeal, to the extent an appellant's challenge to the court's determination that a claim has probable validity "presents a question of fact, we apply the deferential substantial evidence standard of review. [Citation.] 'If the trial court resolved disputed factual issues, the reviewing court should not substitute its judgment for the trial court's express or implied findings supported by substantial evidence. [Citations.]' [Citation.] . . . To the extent, however, that the trial court's finding presents a question of law, we review it independently. [Citation.]" (Chino Commercial Bank, N.A. v. Peters (2010) 190 Cal.App.4th 1163, 1169-1170 (Chino Commercial Bank, N.A.).)
In this case, the parties agree that because the court's finding that respondents are likely to prevail at trial rests on its interpretation of the SPAs and the ROFR Agreement, that finding is subject to de novo review. (See Chino Commercial Bank, N.A., supra, 190 Cal.App.4th at pp. 1169-1170.) They also agree that because both contracts provide that Delaware law governs their interpretation, we must use Delaware law in interpreting them. (SPAs, § 8.10; ROFR Agreement, § 9.7; see, e.g., Nedlloyd Lines B.V. v. Superior Court (1992) 3 Cal.4th 459, 469, fn. 7; Hambrecht & Quist Venture Partners v. American Medical International, Inc. (1995) 38 Cal.App.4th 1532, 1540, fn. 5.)
" 'Delaware law adheres to the objective theory of contracts, i.e., a contract's constructions should be that which would be understood by an objective, reasonable third party.' When interpreting a contract, this Court 'will give priority to the parties' intentions as reflected in the four corners of the agreement,' construing the agreement as a whole and giving effect to all its provisions. 'Contract terms themselves will be controlling when they establish the parties' common meaning so that a reasonable person in the position of either party would have no expectations inconsistent with the contract language.' 'Under standard rules of contract interpretation, a court must determine the intent of the parties from the language of the contract.' " (Salamone v. Gorman (Del. 2014) 106 A.3d 354, 367-368, fns. omitted.) Nonetheless, "[w]hen a contract's plain meaning, in the context of the overall structure of the contract, is susceptible to more than one reasonable interpretation, courts may consider extrinsic evidence to resolve the ambiguity." (Id. at p. 374, fn. omitted.)
III. Interpretation of the Relevant Contracts' Meaning
We observe at the outset that this court's role is not to definitively determine which party's interpretation of the ROFR Condition in the SPAs is correct, a question that will ultimately be decided at trial. (See § 404.050, subd. (b).) Rather, the issue we must resolve in this attachment matter is whether respondents have satisfied their burden of demonstrating the "probable validity" of their contract-related claims, i.e., whether it is "more likely than not" that they will ultimately obtain a judgment against appellant on those claims. (§§ 484.090, subd. (a)(2), 481.190.)
We agree with the trial court's statement at the hearing on respondents' application to extend the writ of attachment that this is a close case and there is "substantial merit to both sides" of the argument.
Appellant, on the one hand, argues that the language of the relevant contracts demonstrates that Aarin Capital's notice, which was sent to appellant during the Initial Exercise Period pursuant to the terms of the ROFR Agreement, caused the ROFR Condition set forth in section 4.1(d) of the SPAs to fail because an eligible investor had exercised a ROFR Right within the specified period. Specifically, appellant points to section 4.1(d) of the SPAs, which provides that, to satisfy the ROFR Condition, "[t]he right of first refusal exercise period under [the ROFR Agreement] shall have expired without any Eligible Investor . . . or the Company exercising any of their respective rights of first refusal thereunder with respect to" appellant's Counsyl shares. (SPAs, § 4.1(d), italics added.) Appellant notes that this provision contains language identical to relevant language in the ROFR Agreement. Thus, according to appellant, the ROFR Condition failed when the relevant "exercise period" discussed in the ROFR Agreement "expired" with Aarin Capital having provided notice of its intent to purchase 125,000 shares of appellant's Counsyl stock. (See ROFR Agreement, §§ 3.1, 3.2.) Appellant also posits that if the parties had intended for the ROFR Condition—included in the SPAs at respondents' "insistence"—to be triggered only after an eligible investor closed the ROFR transaction, they could have included that language in section 4.1(d) of the SPAs.
Respondents drafted the SPAs and, according to respondents' managing partner Zachary Scott, "[t]he ROFR Condition in the SPAs was included at our insistence because we wished to protect ourselves against a situation where the eligible investors with right of first refusal rights undertook a massive exercise of those rights leaving only a de minimis number of shares to purchase. Our investment goals and strategies dictate that we are not interested in a relatively small number of shares and would not have offered to buy them in the first place."
Respondents, on the other hand, maintain that the only sensible interpretation of the ROFR Condition is that the actual purchase of stock was necessary for Aarin Capital to have fully exercised its ROFR Rights and to defeat the ROFR Condition in the SPAs, and because Aarin Capital did not make its purchase within the required timeframe, the ROFR Condition was satisfied. Respondents emphasize the need to look to the purpose of the ROFR Condition, which was to permit termination of the agreement solely in the event that an eligible investor were to actually purchase the shares and receive the stock certificate(s) at the right of first refusal closing. (See ROFR Agreement, § 3.5.) Respondents therefore assert that the failure of appellant and Aarin Capital to close the stock purchase within the time set forth in section 3.5 of the ROFR Agreement voided Aarin Capital's prior ROFR exercise notice, made during the Initial Exercise Period, and did not excuse appellant from consummating the sale to respondents.
Respondents also claimed in the trial court that the evidence showed that the deal between Aarin Capital and appellant was a sham, based on both the small number of shares Aarin Capital intended to buy and the June 7, 2018 agreement to delay purchase, but the court found that respondents had not shown the probable validity of that claim and stated that its final determination of that issue would be made at trial. Neither party raises this argument on appeal.
We believe the meaning of the ROFR Condition in section 4.1(d) of the SPAs "is susceptible to more than one reasonable interpretation." (Salamone v. Gorman, supra, 106 A.3d at p. 374.) As the trial court recognized, there could be two very different possible reasons for including the ROFR Condition in the SPAs. At the first hearing on respondents' application for a writ of attachment, the court expressed concern that an eligible investor could thwart the parties' completion of the sale of all of appellant's Counsyl shares to respondents solely by notifying appellant that it wanted to buy a minimal number of shares, thereby "eliminat[ing] [respondents'] ability to consummate the stock-purchase agreements, even if that qualified investor doesn't pay up." At the subsequent hearing on the application to extend the attachment order, however, the court also noted the contrary possible purpose of the ROFR Condition: "In a world where you didn't know there was a Myriad [acquisition], it's plausible that somebody who wants to get the maximum value for their money will want to know, at the earliest time, that their money might be tied up. So they want to be able to use it somewhere else."
In light of the limited record before us and the ambiguity regarding the meaning of the ROFR Condition, we find that respondents are, at best, equally likely to prevail on their contract-related claims at trial. Such a likelihood is not sufficient for respondents to satisfy their burden under the law of attachment, which requires them to establish that it is "more likely than not" that they will ultimately obtain a judgment against appellant on those claims. (§ 481.190; see § 484.090, subd. (a)(2); see also Kemp Bros. Construction, Inc. v. Titan Electric Corp., supra, 146 Cal.App.4th at p. 1476 [attachment law is purely statutory and must be "strictly construed"].)
We therefore conclude, based on our independent review, that the order extending the writ of attachment must be reversed. (See Chino Commercial Bank, N.A., supra, 190 Cal.App.4th at pp. 1169-1170.) This conclusion of course concerns only the propriety of the "harsh remedy" of an attachment order against appellant. (Martin v. Aboyan, supra, 148 Cal.App.3d at p. 831.) The final determination as to whether respondents' contract-related claims are "actually valid" will not be affected by this decision but, instead, will be separately decided in subsequent proceedings in the trial court. (§ 484.050, subd. (b); see also § 484.100; Santa Clara Waste Water Co. v. Allied World National Assurance Co., supra, 18 Cal.App.5th at p. 889.)
As the parties mentioned at oral argument, discovery in the underlying matter has now begun and there may well be additional evidence bearing on this issue that was not included in the limited record in the attachment proceedings. The trial court will have the benefit of a complete record to assist it in making a final determination regarding the actual validity of respondents' contract-related claims. (See § 484.050, subd. (b).) --------
DISPOSITION
The order granting respondents' application to extend the writ of attachment until trial is reversed. Costs on appeal are awarded to appellant.
/s/_________
Kline, P.J. We concur: /s/_________
Richman, J. /s/_________
Stewart, J.