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9 (“Jimmy”) Horowitz, to Moritz’s third claim for promissory fraud. A copy of the
10 proposed first amended complaint is attached to the Declaration of Suann C.
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11 Moritz, Inc.
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3 2:18-cv-09392-R-FFM
PLAINTIFFS’ MOTION FOR LEAVE TO FILE FIRST AMENDED COMPLAINT
Case 2:18-cv-09392-R-FFM Document 16 Filed 11/16/18 Page 4 of 26 Page ID #:175
1 TABLE OF CONTENTS
2 Page
3 I. INTRODUCTION ............................................................................................. 4
4 II. RELEVANT BACKGROUND AND PROCEDURAL HISTORY................. 6
5 A. Moritz’s Enormous Contribution To The FF Franchise. ........................ 6
6 B. Universal’s And Horowitz’s Fraudulent Promises And
Representations To Moritz Relating To Hobbs and Shaw. .................... 7
7
C. Universal and Horowitz Deny The Oral Producer Deal With
8 Moritz On The Eve Of Filming For Hobbs and Shaw............................ 8
KINSELLA WEITZMAN ISER KUMP & ALDISERT LLP
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1 TABLE OF AUTHORITIES
2 Page
3
FEDERAL CASES
4
Clinco v Roberts
5 41 F. Supp. 2d 1080 (C.D. Cal. 1999)............................................................. 16
6 Delafontaine v. Volvo Cars of N. Am., LLC
No. 16-07154, 2016 WL 7338404 (C.D. Cal. Dec. 19, 2016) ........................ 20
7
Forward-Rossi v. Jaguar Land Rover N. Am., LLC
8 No. 216-CV-00949, 2016 WL 3396925 (C.D. Cal. June 13, 2016) ............... 18
KINSELLA WEITZMAN ISER KUMP & ALDISERT LLP
11 No. C 10-03225, 2010 WL 3910145 (N.D. Cal. Oct. 5, 2010) ....... 6, 13, 15, 17
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TREATISES
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1 I. INTRODUCTION
2 Plaintiffs Neal Moritz and Neal H. Moritz, Inc. (collectively, “Moritz”)
3 respectfully request leave from the Court to amend their complaint (the
4 “Complaint”) against Defendants Universal City Studios, LLC and FFSO
5 Productions, LLC (collectively, “Universal”) to add Universal President, Jimmy
6 Horowitz, as a defendant with respect to their third claim for promissory fraud. A
7 copy of the proposed First Amended Complaint is attached hereto as Exhibit A.
8 Plaintiff Neal Moritz is a producer of motion pictures and television, and one
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9 of the main forces behind the blockbuster motion picture franchise, The Fast and the
10 Furious (the “FF Franchise”). Moritz has been involved in every aspect of the
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11 Franchise from its inception until very recently. Universal is the distributor of the FF
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12 Franchise. This case arises out of Universal’s numerous fraudulent promises and
13 representations to Moritz over a year-and-a half period regarding his production of
14 the next installment of the FF Franchise, Hobbs and Shaw.
15 As can be gleaned from multiple specific references in the Complaint, the
16 principal perpetrator of Universal’s fraud was its President, Jimmy Horowitz.
17 However, when the case was filed in Los Angeles County Superior Court (“superior
18 court”) on October 17, 2018, Moritz named only Universal in its promissory fraud
19 claim and did not name Horowitz individually. This was because at the time, the
20 parties were still discussing a possible early resolution of the dispute. Moritz had
21 worked with Horowitz for a number of years and maintained a vain hope that he
22 would finally do the right thing and honor the previous agreements and
23 representation he had made. As it turns out, no good deed goes unpunished.
24 On Sunday, November 4, 2018, Universal retaliated against Moritz by
25 advising his long-time counsel that Universal was exercising its pay-or-play clause
26 with respect to The Fast and the Furious 9 (“FF9”), and removing Moritz from
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4 2:18-cv-09392-R-FFM
PLAINTIFFS’ MOTION FOR LEAVE TO FILE FIRST AMENDED COMPLAINT
Case 2:18-cv-09392-R-FFM Document 16 Filed 11/16/18 Page 8 of 26 Page ID #:179
9 superior court. Notably, Universal served the answer by FedEx for Monday morning
10 delivery on November 5, 2018, and did not serve an email “courtesy copy” of the
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11 notice of removal until November 5 as well. (Id.) Universal understood that by the
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12 time it pay-or-played Moritz from FF9, it would be too late for Moritz to add
13 Horowitz as an individual defendant in the superior court action.
14 Universal’s obvious goal was to forum shop and try to prevent Moritz from
15 naming Horowitz as an individual defendant in this case. This blatant gamesmanship
16 should not be tolerated. On the face of the Complaint, it is clear that Horowitz, a
17 California resident and the President of Universal Pictures, perpetrated the alleged
18 fraud against Moritz. Indeed, his name is mentioned sixteen times in the Complaint.
19 Pursuant to the relevant six-part analysis under 28 U.S.C. section 1447(e), this is
20 precisely the type of case where district courts routinely allow leave to amend to add
21 a diversity-destroying defendant.
22 “District courts in California routinely hold that a defendant has failed to
23 show that a party is not necessary under Rule 19(a) where the diversity-destroying
24 party is the existing defendant’s employee and also the employee who allegedly did
25
26 1
FF9 is scheduled to be the next film in the FF Franchise after Hobbs and
Shaw. Because Universal and Moritz have a written agreement that covers sequels
27 such as FF9, Universal was unable to deny this agreement.
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1 the act that harmed the plaintiff.” Negrete v. Meadowbrook Meat Co., No. 11-1861,
2 2012 WL 254039, at *3 (C.D. Cal. Jan. 25, 2012). In particular, district courts have
3 allowed “plaintiff[s] . . . to join the very employee . . . whose conduct allegedly
4 made [his employer] liable for fraud.” Graunstadt v. USS-Posco Indus., No. C 10-
5 03225, 2010 WL 3910145, at *3 (N.D. Cal. Oct. 5, 2010).
6 As described below, all six relevant factors strongly favor allowing Moritz to
7 amend his Complaint to add Horowitz as an individual defendant. Moreover, if this
8 motion is denied, Moritz will have to consider initiating another promissory fraud
KINSELLA WEITZMAN ISER KUMP & ALDISERT LLP
9 action against Horowitz in superior court, which would clearly result in avoidable
10 prejudice, expense, and judicial inefficiency. It could also result in inconsistent
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11 rulings. Accordingly, Moritz respectfully requests that the Court grant this motion
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1 Moritz and Morgan pitched Universal Pictures Chairman, Donna Langley, with the
2 idea for Hobbs and Shaw. Langley absolutely loved the concept. (Id., ¶ 32.)
3 B. Universal’s And Horowitz’s Fraudulent Promises And
4 Representations To Moritz Relating To Hobbs and Shaw.
5 At or around that same time, Moritz had conversations with the President of
6 Universal Pictures, Jimmy Horowitz, where they discussed Moritz’s producer deal
7 for Hobbs and Shaw. Horowitz orally promised Moritz that his producer deal on
8 Hobbs and Shaw would return to a first dollar gross deal, and would be modeled
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9 after the first dollar gross option from his last producer deal with Universal. (Id., ¶
10 33.) As it turns out, the evidence strongly supports that Horowitz made this oral
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1 making a great movie.” At or around this same time, Horowitz confirmed that
2 Moritz would also receive his own individual and production company cards on
3 Hobbs and Shaw. (Id.) In retrospect, all of these representations by Universal and
4 Horowitz were designed to keep Moritz working on Hobbs and Shaw throughout the
5 summer of 2018, which was a critical time in pre-production of the film.
6 During the summer of 2018, Moritz continued working steadily on production
7 of Hobbs and Shaw, including numerous conversations between Moritz and
8 Horowitz regarding checklists for production. (Id., ¶ 51.) In August 2018, just one
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9 month before filming was set to begin on Hobbs and Shaw, Horowitz and other
10 executives at Universal asked Moritz if he would amend his oral producer
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11 agreement on the picture from a first dollar gross deal to a post-breakeven pool. (Id.
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9 and abusive attempt by Universal and Horowitz to force Moritz to accept a dramatic
10 reduction in his producer deal on the eve of filming.
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12 London working on the film, and Moritz was set to arrive the following week. (Id., ¶
13 55.) Indeed, Moritz’s production executive, Amanda Lewis, had moved to London
14 at Universal’s expense with her husband and her two young children. (Id.) Clearly,
15 Universal and Horowitz assumed that if it strung Moritz along until the eve of
16 filming, they could have the best of both worlds. Universal could exploit all of
17 Moritz’s creative ideas and hard work in connection with Hobbs and Shaw, but then
18 strong arm Moritz on the eve of filming into amending his oral deal to accept
19 substantially inferior terms. (Id.)
20 When Moritz refused to go along with Universal’s and Horowitz’s
21 extraordinary bad faith and fraud, Universal banned him from the production of
22 Hobbs and Shaw and this lawsuit followed. (Id., ¶ 56.)
23 D. Moritz Files A Complaint In Superior Court.
24 On October 17, 2018, Moritz filed his Complaint in superior court. Moritz
25 plead three causes of action for breach of oral contract, breach of implied contract,
26 and the California tort of promissory fraud. Moritz named Universal Studios, LLC
27 and FFSO Productions LLC as defendants on each claim. As detailed in numerous
28 specific references in the Complaint, the principal perpetrator of Universal’s fraud
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1 was its President, Jimmy Horowitz. Horowitz’s name is mentioned sixteen times in
2 the Complaint. (Complaint, ¶¶ 33-34, 40-41, 45-46, 51-52, 75.)
3 When the case was filed in superior court, however, Moritz named only
4 Universal as a defendant in its promissory fraud claim and did not name Horowitz
5 individually. This was because at the time, the parties were still discussing a
6 possible early resolution of the dispute. (Abramson Decl., ¶ 2.) Moritz had worked
7 with Horowitz for a number of years and hoped that he would finally do the right
8 thing and honor his previous agreements and representation. Moritz did not want to
KINSELLA WEITZMAN ISER KUMP & ALDISERT LLP
1 time it pay-or-played Moritz from FF9, it would be too late for Moritz to add
2 Horowitz as an individual defendant in the superior court action.
3 III. THE COURT SHOULD GRANT MORITZ LEAVE TO AMEND THE
4 COMPLAINT TO ADD HOROWITZ AS A DEFENDANT
5 A. Legal Standard For Amendment Following Removal.
6 Generally, a plaintiff may amend a complaint as a matter of course 21 days
7 after service of defendant’s responsive pleading. Fed. R. Civ. P 15(a). Federal Rule
8 of Civil Procedure 15 states that “[i]n all other cases . . . [t]he court should freely
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11 concluded that ‘the logic and policy of Rule 15(a) do not apply’ in the case of a
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11 2017)). As demonstrated in detail below, all of these factors strongly favor allowing
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9 The district court reasoned that “[i]f the facts alleged are true, UPI cannot be
10 found liable for fraud without first finding that Brevig intentionally did not disclose
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1 rise to Plaintiff's claims against Sprint Connect.” Id. at *4. The district court further
2 noted that:
3 Plaintiff’s defamation claim against Latif is based on the
4 exact same allegations as her defamation claim against
5 Sprint Connect. In addition, Plaintiff's allegations against
6 Latif are intertwined with her other claims against Sprint
7 Connect because Latif was a direct participant in the
8 activities that gave rise to her claims against Sprint
KINSELLA WEITZMAN ISER KUMP & ALDISERT LLP
9 (11th ed.), Torts § 34, at 151 (“An agent or employee is always liable for that
10 person’s own torts. This is so whether the principal or employer is liable or not.”)
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11 While Universal obviously is liable for torts that Horowitz committed in the
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1 waste judicial resources and invite the risk of inconsistent results, the fact that a
2 statute of limitations has not yet tolled should not prevent joinder.” Id.
3 The applicable statute of limitations does not bar Moritz from filing a state
4 court action against Horowitz for promissory fraud. The fraudulent representations
5 were made in 2017 and 2018, and the statute of limitations for the tort of promissory
6 fraud is three years from the discovery of the facts constituting the fraud or mistake.
7 Cal. Code Civ. P. § 338(d). However, as explained above, if this motion is denied,
8 Moritz will have to consider filing a complaint for promissory fraud against
KINSELLA WEITZMAN ISER KUMP & ALDISERT LLP
11 possible, requiring [Moritz] to litigate essentially the same issues in two forums
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12 would be a waste of judicial resources and risks inconsistent results.” IBC Aviation
13 Servs. v. Compania Mexicana de Aviacion, S.A. de C.V., 125 F. Supp. 2d 1008 (N.D.
14 Cal. 2000) at 1012 (permitting joinder of corporate defendant’s Vice President of
15 Sales and remanding to Superior Court). Thus, this factor also favors Moritz.
16 3. Moritz’s proposed amendment is timely.
17 “When determining whether to allow amendment to add a nondiverse party,
18 courts consider whether the amendment was attempted in a timely fashion.”
19 Gamboa, 2018 WL 3129776, at *3 (quoting Clinco v Roberts, 41 F. Supp. 2d 1080,
20 1083 (C.D. Cal. 1999). “California district courts have held that amendment as late
21 as nine months after the original complaint was filed is still timely under Section
22 1447(e) if no dispositive motions have been filed and the discovery completed thus
23 far will be relevant whether the case is litigated in federal court or state court.”
24 Morales, 2018 WL 2448466, at *4 (citations omitted); see also Gamboa, 2018 WL
25 3129776, at *3 (finding no unreasonable delay in seeking joinder and remand six
26 months after complaint was filed); Lara v. Bandit Industries, Inc., 2013 WL
27 1155523, at *3 (E.D. Cal. Mar. 19, 2013) (finding that filing motion for leave to
28 amend five months after initial complaint and three months after removal was not
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1 untimely when parties had not filed dispositive motions); Yang v. Swissport USA,
2 Inc., No. C 09-03823, 2010 WL 2680800, at *4 (N.D. Cal. July 6, 2010) (granting
3 motion to amend filed nine months after removal, where “no dispositive motions
4 have been filed”).
5 Moritz has obviously not delayed here. Moritz filed his Complaint less than
6 one month ago in superior court, and Universal removed only two weeks later. In
7 fact, if Universal had not filed an early answer in superior court, Moritz could have
8 dismissed his Complaint without prejudice as a matter of right, and re-filed naming
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9 Horowitz as defendant. Universal was well aware of this rule, which is presumably
10 why it filed an answer two weeks before it was due and prior to removal. Moreover,
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11 no discovery has been taken in the action, and no dispositive motions have been
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12 filed. Accordingly, this factor also strongly favors granting Moritz leave to amend.
13 4. Moritz’s motive for joinder is valid.
14 “The motive of a plaintiff in seeking joinder of a non-diverse defendant is
15 relevant to a court's decision as to whether to grant leave to amend his original
16 complaint.” Graunstadt, 2010 WL 3910145, at *4. “There is a ‘general
17 presumption’ that joinder is not fraudulent, that is, there is a general presumption
18 that a plaintiff’s sole purpose is not to defeat diversity jurisdiction.” Jackson v.
19 Dollar Tree Distribution, Inc., No. CV 18-2302, 2018 WL 2355983, at *4 (C.D.
20 Cal. May 23, 2018) (citations omitted) (allowing joinder of Defendant’s employee
21 and remanding even when “the Court is skeptical of the situation and [the proposed
22 employee Defendant] is not necessarily an indispensable party”). Moreover,
23 “suspicion of diversity destroying amendments is not as important now that
24 § 1447(e) gives courts more flexibility in dealing with the addition of such
25 defendants. Because of this, ‘when considering motive, courts often consider
26 whether plaintiff is attempting unreasonably to delay proceedings.’” Graunstadt,
27 2010 WL 3910145, at *4. (Citations and quotes omitted).
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1 Moritz had a valid reason for not naming Horowitz in his initial filing. Given
2 the very long relationship between the parties, Moritz maintained a shred of
3 misplaced faith that Universal would finally do the right thing and seek to
4 expeditiously resolve the lawsuit. (Abramson Decl., ¶ 2.) Moritz believed that
5 naming Horowitz might close that door prematurely. But instead, Universal
6 retaliated against Moritz by evoking its pay-or-play option to remove him from FF9.
7 (Id., ¶ 3, Ex. “D.”) Now, Moritz seeks to proceed with his case against Universal
8 and Horowitz as he always intended. As the case was initiated less than a month
KINSELLA WEITZMAN ISER KUMP & ALDISERT LLP
1 Cal. May 10, 2010); see also Graunstadt, 2010 WL 3910145, at *4 (“If a plaintiff
2 seeking joinder states meritorious claims against a non-diverse defendant, joinder is
3 favored.”) Clearly, a valid promissory fraud claim exist against Horowitz.
4 California Civil Code § 1710(4) specifically defines actionable “deceit” to
5 include “[a] promise, made without any intention of performing it.” California case
6 law clearly recognizes claims for promissory fraud as independent causes of action,
7 even where a breach of contract claim has also been asserted. See Tenzer v.
8 Superscope, Inc., 39 Cal.3d 18, 30 (1985); Tarmann v. State Farm Mut. Auto Ins.
KINSELLA WEITZMAN ISER KUMP & ALDISERT LLP
11 not to perform is a state of mind, and that misrepresentation of such a state of mind
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9 superior court). That is precisely what will happen here if the Court denies Moritz’s
10 motion for leave to amend.
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11 If the Court denies the motion, Moritz will have to strongly consider filing a
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12 fraud claim against Horowitz in superior court. However, it will be very expensive
13 and inefficient to litigate two parallel actions relating to exact same circumstances.
14 It would also require extensive duplicative discovery, and could easily lead to
15 inconsistent rulings. Given the obvious prejudice to Moritz if the motion is denied,
16 this factor also weighs heavily in favor of permitting the joinder of Horowitz.
17 By contrast, there is no prejudice to Universal if the motion is granted.
18 Universal Pictures’ principal place of business is Los Angeles County, California.
19 Moritz’s Complaint involves all state law claims. There is no prejudice to
20 Universal proceeding in superior court.
21 IV. CONCLUSION
22 As demonstrated herein, Universal is engaging in blatant forum shopping in
23 an attempt to keep its President, Jimmy Horowitz, from being personally named in
24 the action. All of the factors that district courts consider when determining whether
25 to allow joinder following removal support Moritz’s request to join Horowitz as a
26 defendant in the promissory fraud claim. Moreover, if this motion is denied, Moritz
27 will be forced to strongly consider initiating duplicative litigation in superior court
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PLAINTIFFS’ MOTION FOR LEAVE TO FILE FIRST AMENDED COMPLAINT
Case 2:18-cv-09392-R-FFM Document 16 Filed 11/16/18 Page 24 of 26 Page ID #:195
1 and risk inconsistent judgments. Accordingly, Moritz respectfully requests that this
2 Court grant Moritz’s motion for leave to amend to allow joinder of Horowitz.
3
4 DATED: November 16, 2018 KINSELLA WEITZMAN ISER KUMP
& ALDISERT LLP
5
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By: /s/ Dale F. Kinsella
8 Dale F. Kinsella, Attorneys for Neal Moritz
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9 2. Attached hereto as Exhibit “A” is a true and correct copy of the First
10 Amended Complaint that Moritz is seeking leave to file in this action. This First
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r,~~U• 14 I declare under penalty of perjury under the laws of the United States of
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N J ~~ 16 Executed November 16, 2018, at Santa~/Ionica, Califo~,nia.
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PLAINTIFFS' MOTION FOR LEAVE TO FILE FIRST AMENDED COMPLAINT