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Regent Alliance Ltd. v. Rabizadeh

California Court of Appeals, Second District, First Division

November 25, 2014

REGENT ALLIANCE LTD., Plaintiff and Appellant,
v.
ROUHOLLAH RABIZADEH et al., Defendants and Respondents.

APPEAL from a judgment of the Superior Court of Los Angeles County, No. BC429863 Daniel J. Buckley, Judge.

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[Copyrighted Material Omitted]

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COUNSEL

Daar & Newman, Jeffery J. Daar and Michael R. Newman for Plaintiff and Appellant.

Law Office of Mohammad A. Fakhreddine and Mohammad A. Fakhreddine for Defendants and Respondents.

OPINION

JOHNSON, P.J.

Regent Alliance Ltd. (Regent) sued three purchasers of children’s clothing for conversion, alleging that the purchasers bought, from other defendants, clothing belonging to Regent that those other defendants had converted. The trial court granted the purchasers’ motions for summary judgment, and Regent appeals. We reverse.

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BACKGROUND

Regent, a Hong Kong corporation that manufactures children’s clothing, filed a first amended complaint in 2010 against multiple defendants, including Rouhollah Rabizadeh, Bahram Dahi, and his wife Farahnaz Dahi[1] (the buyer defendants), all three doing business as B&R Clothing and Kids Street. The complaint alleged in its 13th, 14th, and 15th causes of action that Rabizadeh, Bahram, and Farahnaz purchased and resold converted property—children’s clothing (the clothing)—from other defendants (the warehouse defendants) including YHK Transportation, Inc., against which the complaint also alleged conversion. YHK had agreed with Regent to store the clothing in YHK’s warehouse facility in Carson, California, but after the clothing was delivered to the warehouse and YHK took possession, YHK transferred the clothing without Regent’s knowledge to another defendant’s warehouse in Commerce. The warehouse defendants, who “had previously converted the Children’s Clothing, ” then sold it to the buyer defendants, who subsequently sold the clothing to others.

In May 2012, Rabizadeh, Bahram, and Farahnaz filed separate motions for summary judgment. The motions argued that because each of the buyer defendants was allegedly a “subsequent converter”—that is, a receiver or transferee of previously converted goods—they could not be liable for conversion because they purchased the goods for value and in good faith, without actual or constructive notice that the goods had been converted.

The trial court granted summary judgment in favor of Rabizadeh, Bahram, and Farahnaz after a hearing on July 25, 2012. The court agreed with the buyer defendants’ reasoning that innocent purchasers of converted goods are not liable for conversion. The court further determined that the buyer defendants’ evidence “meets the initial burden to show that they purchased the clothing under circumstances that did not indicate to a prudent person that the clothing had been stolen” and that Regent did not introduce sufficient contrary evidence to create any material factual disputes. The court accordingly entered judgment in favor of the buyer defendants, and Regent timely appealed from the judgment.

DISCUSSION

Regent argues that the superior court erred when it agreed with the buyer defendants that innocent purchasers of converted goods are not liable for conversion. Reviewing de novo the court’s order granting summary

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Judgment (Buss v. Superior Court (1997) 16 Cal.4th 35, 60 [65 Cal.Rptr.2d 366, 939 ...


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