(Super. Ct. No. 30-2009-00327269) Appeal from a judgment of the Superior Court of Orange County, James Di Cesare, Judge.
The opinion of the court was delivered by: Fybel, J.
CERTIFIED FOR PUBLICATION
Penal Code section 496, subdivision (a) (section 496(a)) makes receiving or buying property "that has been obtained in any manner constituting theft" a criminal offense punishable by imprisonment. Section 496, subdivision (c) (section 496(c)) provides that any person "who has been injured by a violation of [section 496(a)] . . . may bring an action for three times the amount of actual damages, if any, sustained by the plaintiff, costs of suit, and reasonable attorney's fees." (Italics added.)
A default judgment was entered against Igal J. Feibush for breach of contract, fraud, and treble damages under section 496(c). He challenges the treble damages on the ground he was never convicted in a criminal proceeding of the acts giving rise to liability under section 496(c). He argues a defendant must be convicted under section 496(a) before a private plaintiff may recover treble damages against that defendant under section 496(c).
We hold, based on the statutory language, a criminal conviction under section 496(a) is not a prerequisite to recovery of treble damages under section 496(c). We also hold the phrase "any manner constituting theft" under section 496(a) includes theft by false pretense. We therefore affirm the judgment.
FACTS AND PROCEDURAL HISTORY
Sharon Bell filed a complaint asserting causes of action against Feibush for breach of contract, fraud, and violation of section 496(a). As a sanction for abuse of the discovery process, the trial court struck Feibush's answer and deemed admitted certain requests for admission. Bell requested entry of a default judgment, and a default prove-up hearing was conducted.
The evidence presented at the default prove-up hearing showed the following. Feibush induced Bell to loan him $202,500 based on the false pretense he owned the trademark "Toughlove" and he needed the money to settle a lawsuit over his interests in what he called the "toughlove" industry. That industry, Feibush explained, "involved the rehabilitation of troubled individuals through the implementation of strict counseling and other forms of treatment generally referred to as 'toughlove.'" Feibush told Bell that his business plan was to launch a national "revamped" version of Toughlove that would earn millions of dollars.
Feibush's representations were false, and the so-called toughlove business was a scam. When Bell asked for her money back, Feibush gave her a "litany of excuses" and never repaid her.
At the trial court's request, Bell submitted supplemental briefing and declarations on the issues of attorney fees and trebling damages under section 496(c). The court heard oral argument on those two issues. Feibush was present but did not formally appear and was not represented by counsel. Bell's counsel argued Feibush had violated section 496(a) because "[h]e stole the property by means of a false artifice, and he maintained custody of that property to the exclusion of my client." The trial court awarded Bell treble damages but stated, "I really don't like it, to be honest with you, but that is what [Penal Code section 496] says."
Default judgment was entered in October 2011. The judgment awards Bell damages of $202,500 plus prejudgment interest on her breach of contract and fraud causes of action, and awards her treble damages of $607,500 on her section 496(a) cause ...