The opinion of the court was delivered by: Marc L. Goldman United States Magistrate Judge
MEMORANDUM OPINION AND ORDER GRANTING PLAINTIFF'S MOTION FOR WRIT OF ATTACHMENT
I. Factual and Procedural Background
On March 12, 2010, Plaintiff Diandra Douglas filed an application for right to attach order and writ of attachment against Defendants, Patrick N. Smith ("Patrick"), his wife Susan Smith ("Susan"),*fn1 and QRI, LLC ("QRI"), a California limited liability company.*fn2 On April 2, 2010, Patrick and QRI filed an opposition to Plaintiff's application and Susan filed a separate opposition. On April 14, 2010, Plaintiff filed a consolidated reply to Defendants' oppositions. A hearing was held on the applications on April 20, 2010.
The underlying facts are largely undisputed by the parties. On May 1, 2008, Plaintiff and Defendant QRI entered into a written contract under which QRI leased Plaintiff's real property located at 936-940 Hot Springs Road, Montecito, California (the "Premises"), at the rental rate of $40,000 per month. Declaration of Diandra Douglas ("Douglas Decl.") ¶¶ 6, 7, Exs. 1, 3. For $2 million, to be paid in two $1 million installments, QRI also acquired an option to purchase the property (the "Option Agreement"). Douglas Decl. ¶ 4, Ex. 1. Patrick and Susan Smith both signed a document in which they guaranteed QRI's obligations under the contract. QRI made the first $1 million option payment in May 2008, but did not make the second $1 million option payment, which came due on May 1, 2009. Douglas Decl. ¶ 4. QRI also stopped making the monthly rental payments in May 2009. Douglas Decl. ¶¶ 12, 13. Plaintiff seeks a writ of attachment in the amount of $1,341,666.67*fn3 against the property of each of the Defendants.*fn4
Federal Rule of Civil Procedure 64 provides for prejudgment attachment and other prejudgment remedies. A United States district court, addressing a motion for prejudgment attachment in a diversity action, generally applies the law of the state in which the district court sits. See Fed. R. Civ. P. 64; Granny Goose Foods, Inc. v. Brotherhood of Teamsters & Auto Truck Drivers Local No. 70, 415 U.S. 423, 436-437 (1974); United States v. Van Cauwenberghe, 934 F.2d 1048, 1063-64, n. 13 (9th Cir. 1991). Therefore, in this case, the Court will apply the California prejudgment attachment statutory scheme. California Code of Civil Procedure §§ 481.010, et seq.
A prejudgment writ of attachment may be issued to secure the amount of the claimed indebtedness, as well as the estimated costs and allowable attorney's fees. Cal. Code Civ. Proc. § 482.110(b). The burden is on the moving party to establish entitlement to a writ of attachment. Loeb and Loeb v. Beverly Glen Music, Inc., 166 Cal.App.3d 1110, 1116 (1985); see also Legislative Committee Comment to 1974 Addition to Code of Civil Procedure § 484.090 (stating that the "plaintiff has the burden of proving (1) that his claim is one upon which an attachment may be issued, and (2) the probable validity of such claim"). Since California's attachment law is purely statutory, it must be strictly construed. Kemp Bros. Constr., Inc. v. Titan Elec. Corp., 146 Cal.App.4th 1474, 1476 (2007). Under California law, an attachment may issue only if the claim sued upon is (1) a claim "for money ... based upon a contract, express or implied;" (2) of a "fixed or readily ascertainable amount not less than $500;" (3) that is either unsecured or secured by personal property; and (4) that is a "commercial claim." Cal. Code Civ. Proc. § 483.010.
III. Plaintiff Has Met the Statutory Requirements for a Writ of Attachment Against Defendants Patrick and Susan Smith
There is no dispute between the parties that Plaintiff's claim is (1) for money based upon a contract, the option agreement; (2) of a fixed or readily ascertainable amount not less than $500, i.e., the $1 million dollar option payment that became due on May 1, 2009; and (3) the obligation is not secured by any interest in real property. Cal. Code Civ. Proc. § 483.010, Douglas Decl. ¶ 4. The only real dispute between the parties is whether Plaintiff's claim against Defendants Patrick and Susan Smith is a "commercial claim" within the meaning of the statute.
A. The Claim Against Patrick and Susan Smith Arises Out of Their Conduct of a Trade, Business or Profession
Commercial claims against individuals must arise out of the defendant's conduct of a trade, business or profession. Cal. Code Civ. Proc. § 483.010(c); Kadison, Pfaelzer, Woodard, Quinn & Rossi v. Wilson, 197 Cal.App. 3d 1, 4 (1987). What constitutes a "trade, business or profession" has yet to be definitively construed. Generally, it means an activity carried on "for the purpose of livelihood or profit on a continuing basis." Nakasone v. Randall, 129 Cal.App.3d 757, 764 (1982) (emphasis added).
Attachment of the assets of individual guarantors of corporate obligations or business debts is proper if the guaranty arose out of the conduct of the guarantor's business, that is, if "the guarantee of the primary obligor's debt sued upon is part and parcel of an activity which occupies the time, attention and effort of the guarantor for the purpose of livelihood or profit on a continuing basis." Advance Transformer Co. v. Super. Ct., 44 Cal.App.3d 127, 144 (1974) (emphasis added) (finding attachment proper where a husband and wife guaranteed a promissory note as payment for business materials of a closely held corporation.) Accordingly, attachment may issue against an individual guarantor who is: (a) in the business of extending credit generally, or (b) so involved in the primary obligor's business that the guaranty is made to further the guarantor's livelihood or profit on a continuing basis. Id. It is immaterial whether the individual guarantor is dependent upon the business for his livelihood or devotes little time to it. Id. at 135.
In determining whether attachment was appropriate against the guarantors in the Advance Transformer case, the court distinguished between conduct demonstrating only occasional investment activity and that involving "carrying on an activity for the purpose of livelihood or profit on a continuing basis." The court held that a writ of attachment may issue to a natural person if any one of the following three circumstances is established: (1) a corporation has habitually been provided with operating capital through the medium of such guarantees by the defendant, or (2) the obligation sued upon has resulted from an extension of credit in reliance upon defendant's continuing guarantee, or (3) the defendant has extensively occupied himself in the management of the primary obligor on a continuing basis and has a major stake in its success. Id. at 144. "In short, if the sum total of the circumstances justifies the conclusion that the guarantor occupied himself to a substantial degree and on a continuing basis in promoting his own profit through provision of credit or management to the primary obligor, a guarantee executed in the course of such activity may properly be considered an obligation arising out of the conduct of the guarantor's business." Id.
The Smiths contend that Plaintiff's claim does not arise out of their involvement in a business conducted on a "continuing basis." Def.'s Opp., Mem. of P. & A. at 8. Patrick first argues that he is not in the "business of" providing corporate guarantees. However, Defendants do not cite any authority that holds that the only persons who can be subject to writs of attachment are those who are engaged in the business of providing guarantees. Neither the structure nor the language of section 483.010 support that construction. Moreover, by his own admission, Patrick has guaranteed real property-related obligations on numerous occasions for up to hundreds of millions of dollars. Pauly Decl., Ex. 1, ¶ 13. For example, Patrick states that he "had personal guarantees which exposed [him] to liabilities of at least $35,000,000 and ...