United States District Court, E.D. California
KAREN RIGSBY, Trustee of the MARSH REVOCABLE TRUST OF 2003, and DONALD P. STEINMEYER, an individual, Plaintiffs,
INTERCARE SPECIALTY RISK INSURANCE SERVS., INC., a California Corporation; ISR HOLDINGS, INC., a California Corporation; KEVIN HAMM, an individual; and PATRIOT NATIONAL, INC., a Florida Corporation, Defendants.
MEMORANDUM AND ORDER
MORRISON C. ENGLAND JR. UNITED STATES DISTRICT JUDGE.
of their Complaint filed on June 30, 2017, Plaintiffs Karen
Rigsby, Trustee of the Marsh Revocable Trust of 2003
(“Rigsby”), and Donald P. Steinmeyer
(“Steinmeyer”), sued Defendants Intercare
Specialty Risk Insurance Services, Inc., a California
corporation (“Intercare”); ISR Holdings, Inc., a
California corporation (“ISR”); Kevin Hamm
(“Hamm”); and Patriot National, Inc., a Florida
corporation (“Patriot”), alleging several causes
of action, including breach of contract. Presently before the
Court is Plaintiffs' Motion for Right to Attach Order and
Writ of Attachment (“Motion”), by which
Plaintiffs seek to secure $987, 250: the $962, 250 that
Plaintiffs allege is owed them by Defendants, as well as $25,
000 in estimated attorney's fees and costs. ECF No. 7.
For the reasons set forth below, Plaintiffs' request is
dispute arises out of the execution of a December 31, 2010,
asset purchase agreement (“APA”) of PRM Insurance
Services, an insurance brokerage firm. Gene Marsh
(Rigsby's predecessor-in-interest) and Steinmeyer sold
the firm to Defendants. The APA provided for Defendants to
make monthly payments of $12, 250 to Marsh and $5, 500 to
Steinmeyer over a period of ten years, ending in December
2020. Defendants made these payments in satisfaction of the
APA until July 2015, when the payments decreased and
ultimately ceased entirely. Plaintiffs allege that Defendants
are liable for the underpaid and remaining balance of
payments under the APA. Specifically, Rigsby alleges that
Defendants owe the Marsh Revocable Trust at least $684, 250,
and Steinmeyer alleges that Defendants owe him at least $278,
000. These numbers, Plaintiffs allege, represent the amount
unpaid since July 2015, and the remaining APA payments
through December 2020.
counterclaimed for, among other things, breach of contract,
an accounting, and unjust enrichment. Defendants claim that
it is actually Plaintiffs who owe Defendants money due to
Plaintiffs' alleged misrepresentations and other
wrongdoings related to the APA. Defendants argue that
Plaintiffs “ignore” mutually agreed-upon
modifications to the APA in their complaint, and that the
modifications reduced the payments owed by Defendants.
Further, Defendants claim that Plaintiffs misrepresented and
failed to disclose material issues impacting the agreement.
For example, the APA included provisions for Defendants to
make airplane lease payments to Marsh for as long as he had
an airplane available for their use. Defendants allege that
Marsh sold his airplane but did not terminate the lease with
Defendants or inform them of the sale, so Defendants
continued to pay Marsh for the airplane lease past the
appropriate date. Defendants allege that they overpaid Marsh
$102, 000 based on the airplane lease issue alone. Among
their other claims, Defendants also allege that Plaintiffs
led Defendants to overpay broker commission claims by more
than $400, 000 above the maximum amount provided in the APA.
In sum, Defendants allege that Plaintiffs owe them at least
$1, 000, 000, and that they do not owe Plaintiffs anything.
Rule of Civil Procedure 64 codifies the “long-settled
federal law providing that in all cases in federal court,
whether or not removed from state court, state law is
incorporated to determine the availability of prejudgment
remedies for the seizure of person or property to secure
satisfaction of the judgment ultimately entered.”
Granny Goose Foods, Inc. v. Bhd. Of Teamsters & Auto
Truck Drivers Local No. 70 of Alameda Cnty., 415 U.S.
423, 436 n.10 (1974). Under California law,
“[a]ttachment 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.”
Kemp Bros. Constr., Inc. v. Titan Elec. Corp., 146
Cal.App.4th 1474, 1476 (2007) (internal quotations omitted)
(emphasis in original). “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, 148 Cal.App.3d
826, 831 (1983). The moving party bears the burden to
establish that attachment is proper, and “[s]ince
California's attachment law is purely statutory, it must
be strictly construed.” VFS Fin., Inc. v. CHF
Express, LLC, 620 F.Supp.2d 1092, 1095 (C.D. Cal. 2009).
an order of attachment may be issued only in an action for a
claim of money which is based upon an express or implied
contract where the total amount of such claim is a fixed or
‘readily ascertainable' amount not less than
$500.00.” Pos-A-Traction, Inc., v.
Kelly-Springfield Tire Co., Div. of Goodyear Tire &
Rubber Co., 112 F.Supp.2d 1178, 1181-82 (C.D. Cal.
2000); Cal. Code Civ. Proc. § 483.010(a). A right to
attach order shall issue only if the court finds, among other
things, that “[t]he plaintiff has established the
probable validity of the claim upon which the attachment is
based.” Cal. Code Civ. Proc. § 484.090(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.”
Id., § 481.190.
contend that their claim is one in which an attachment may
issue under Code Civ. Pro. § 483.010 because
Plaintiffs' claim is for money based upon a commercial
contract, the APA, and such claim is for an allegedly fixed
or readily ascertainable amount: $987, 250. On the record
before the Court, however, Plaintiffs have not met their
burden of establishing that attachment is proper in this
an attachment may be appropriate when a party can prove
readily ascertainable damages “by reference to the
contract and [if] the basis of the computation appears to be
reasonable and definite…. [T]he contract sued upon
must furnish a standard by which the amount due may be
clearly ascertained and there must exist a basis upon which
the damages can be determined by proof.” Lewis v.
Steifel, 98 Cal.App. 2d 648, 650 (1950) (quoting
Force v. Hart, 205 Cal. 670, 673 (1928)). A
preliminary issue with Plaintiffs' motion for attachment
is that the APA itself, upon which Plaintiffs base their
calculations, provides no basis for such accelerated future
payments as Plaintiffs request. Further, Defendants contest
the substance of most, if not all, of Plaintiffs' claims.
Defendants' counterclaims challenge the very foundation
upon which Plaintiffs base their attachment request. The
parties dispute which of them owes the other any amount of
money. For example, as indicated previously, Plaintiffs claim
the full, original amount of APA payments through the end of
the agreement in December 2020, but Defendants contend
Plaintiffs are ignoring mutually agreed-upon modifications to
the APA that lowered the amount of those payments. Plaintiffs
likewise ignore, according to Defendants, the effect of their
failure to inform Defendants of the termination of the
airplane lease, which resulted in Defendants overpaying
Plaintiffs in the alleged amount of $102, 000.
conclusion, there is simply too much at issue in this case
for Plaintiffs to have shown that the amount of the
attachment is “fixed” or “readily
ascertainable, ” particularly given the strict
construction required for attachment claims. See Dongalen
Enter., Inc. v. Metal Framing Enter., LLC, 2016 WL