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CA2DB241675-04
{3 D B6C558-C6 F2-442 E-8C59-DB29FECA552
{141370}_309-130809:081754]{080813}

F}

APPELLANT'S
BRIEF

No. B241675

COURT

OF APPEAL

SECOND

OF THE

APPELLATE

STEPHEN

STATE

DISTRICT,

M. GAGGERO,

OF CALIFORNIA
DIVISION

Plaintiff

EIGHT

and Appellant,

V.

KNAPP,
PETERSEN
& CLARK,
STEVEN
RAY
M. HARRIS;
ANDRE
JARDINI,
Defendants

Appeal

from

the Superior

Court

of California,

Los Angeles
Superior
Court Case
Honorable
Robert L. Hess,

APPELLANT'S

David

GARCIA;
STEPHEN
and Respondents.

County

of Los Angeles

No. BC286925
Dept. 24

OPENING

BRIEF

Blake Chatfield,
State Bar No. 88991
WESTLAKE
LAW GROUP
2625 Townsgate
Road, Suite 330
Westlake
Village,
California
91361
Telephone:
805-267-1220
Facsimile:
805-267-1211
Attorneys
STEPHEN

for Appellant
M. GAGGERO

TO BE FILED
COURT

OF

APPEAL,

APPELLATE

Second

IN THE

DISTRICT,

COURT

DIVISION

OF APPEAL

APP-00g

Eight

o, _

Co_

Suoedor
ATTORNEY
(Name,
Bar number,
and addres].l:
DavidB OR _A_._
a'e _I_HOUT
Chatfieid
(Bar
#State88991)
Westlake Law Group
2625 Townsgal_e Rd., Suite 330
Westlake Village, CA 91361
r_EmONENO.:
(805) 267-1220
FAXFO.
m_:(805)
E-MA_
A_SS_C_O_: davidblakec@yahoo.com

Co=.._:

Courl Ca_

B241675

Numbc_

ATrORNE

ATTORNEY
FOR_=O: Appellant

Stephen

APPEtLANTmETmONER:
Stephen

BC286925
FOR

267-12i

COURT

USE

ONLY

M. Gaggero

M. Gaggcro, :et al.

RESPONDENT/REAL
PARTYININTEREST:
Knapp, Petersen & Clarke, et al.
CERTIFICATE
(Check one):
Notice:

I_

Please

OF INTERESTED

INITIAL CERTIFICATE
read

rules

8.208

and 8.488

ENTITLES
[_

OR PERSONS

SUPPLEMENTAL

before

CERTIFICATE

completing

this form.

You may use this form

for the initial

certificate
in an appeal when you file your.brief
or a prebriefing
motion, application,
or opposition
to such a
.motion
or application
in the Court of Appeal,
and when you file a petition for an extraordinary
writ. You may
also use this form as a supplemental
certificate
when you learn of changed
or additional
information
that must
be disclosed.
1. This form is being su'omitted on behalf of the following party (name): Appellant
2. a.

_]

b. [_

There are no interested

entities or persons

Interested entities or persons

Stephen

that must be listed in this oertificate

M.

Gaggero

under rule 8.208.

required to be listed under rule 8.208 are as follows:

Full name of interested

r
|

Nature of interest

entity or person

(Explain)."

(t) Terra Mar Trust

(2)
(3)
(4)
(5)
[--]

Continued on attachment

2.

The undersigned certifies that the above-listed persons or entities (corporations,

partnerships, firms, or any other
association,
but not including government entitles or their agencies) have either (1) an ownership Interest of 10 percent or
more in the "party If it is an entity; or (21 a financial or other interest in the outcome of the proceeding that the justices
should consider in determining whether to disqualify themselves, as defined In rule 8.208(e)(2).

Date: AUgust

2013

8,

David
fTYPE

Blake Chatfield
CR

PRINT

NAME)

{SIGNATURE

OF

pA._TY OR

ATe. (3RN_'r)/
'/

Form A_rc.t*_i fat OptJonaJ Ut,e

Judi_a] Coun_ of C._orr_a
AP'P-OC8

[Re_

January

I, 2001

CERTIFICATE

OF INTERESTED

ENTITIES

OR PERSONS
,'
Le,rizAre_is_

A taonmted

_c#i_n'inia

Cal.

Ru_.'s e'

Page
Co'Jr;. rules

/;

8.208

t,.'_.v, muz'Jnto
Judicial

Councff

1 of

8486
ca 9o_

Form,t

TABLE
TABLE

OF CONTENTS

TABLE

OF AUTHORITIES

OF

...............................................................................

.........................................................................

ii

STATEMENT

OF APPEALABILITY

STATEMENT

OF THE

STATEMENT

OF FACTS

ARGUMENT

THE

II

TRIAL

There

TO
FOR

is No

IN

HOLD
THE

APPLYING
THESE

OUTSIDE

THIRD

PERSONAL

PARTY

JUDGMENT

....................................................................

Substantial

Alter

Evidence

Egos

that

the Entities

10

are

...........................................................

101

There Is No Substantial
Evidence
That Gaggero
Set Up
His Estate In Order To Defraud
Creditors
..........................
The

Court

Control

RELIEF

MOTION
DOCTRINE

Evidence
SOUGHT

Found

That

Litigation,
That They
BY

THIS

The
And

Entities

Is

No

Did ...................................
POST

AFFIRM

THE

ALTER

THE INTEGRITY

CALIFORNIA

EGO

107

JUDGMENT

FINDING

OF ESTATE

COUNT

..................................................................................

CERTIFICATION

PROOF

OF SERVICE

.........................................................

..............................................................................

19

WOULD

PLANNING

...........................................................................................

WORD

103

Did Not

There

WAS
BARRED
BY
THE
EQUITABLE
OF LACHES
...............................................................

THREATEN

CONCLUSION

Expressly
Gaggero's

Substantial

TO

INSUFFICIENT
EVIDENCE
TO SUPPORT
BELOW
...................................................................

Gaggero's

IV

ERRED

OF APPELLANT

THERE
WAS
THE RESULT

THE

.....................................................................

COURT
LIABLE

C.

................................................................................................

ENTITIES

B.

.........................................................

............................................................................

PIERCING

A.

III

CASE

REVERSE
DEBT

CONTENTS

IN
22
31

313

314

TABLE

California

Cases

Alexander

v. Abbey

of the Chimes

104 Cal.App.3d
Carr

OF AUTHORITIES

v. Barnabey's

Hotel

23 Cal.App.4th
DiMaria

(1980)

39 .......................................................................
Corp.

(1994)

14 ....................................................................................

v. Bank

of California

254 .....................................................................................

Estate

(1977)

67 Cal.App.3d
Galdjie

777 .......................................................................................

v. Darwish

1331 ..............................................................................

v. LADT

LLC

191 Cal.App.4th
Hall,

Goodhue,

Marconi

Haisley

In re Marriage

of Dick

Inc.

v. Abarbanel

v. Kohn

13, 15, 16

(1978)
702 .............................................................................

19, 21

10

(1950)

95 Cal.App.2d

708 ...................................................................................

Lake v. Reed (1997)

16 Cal. 4th 448 ........................................................................................
Las Palmas

6, 7

(1993)

Kazensky
v. City of Merced
(1998)
65 Cal.App.4th
44 ....................................................................................
Kohn

6, 7, 8, 9

v.

144 ......................................................................

77 Cal.App.3d

12

Bd. (1996)

1551 ..............................................................................

15 Cal.App.4th
Jines

& Barker,

Center

41 Cal.App.4th

29

(2010)

486 ......................................................................

Conf.

30

(2003)

113 Cal.App.4th
Greenspan

20

(1965)

237 Cal.App.2d
of Hearst

19, 20, 22

Assoe.

235 Cal.App.3d

v. Las Palmas

Ctr. Assoc.

13

10

(1991)

1220 ...........................................................................

8, 22

Laycock

v. Hammer

(2006)

141 Cal.App.4th

25 ..................................................................................

30

Mesler v. Bragg Management

Co. (1985)
39 Cal.3d 290 ...........................................................................................

13

Minifie
v. Rowley
(1922)
187 Cal. 481 .............................................................................................

23

Misik

v. D'Arco

(2011)

197 Cal.App.4th

1065 ........................................................................

Motores
De MexicalL
S. A. v. Superior
Court (1958)
51 Cal.2d 172...2 ......................................................................................
NEC

Electronics

208
Postal

lnc. v. Hurt

Cal.App.3d
lnstant

Press,

Sonora

Diamond

83 Cal.App.4th
Triplett

v. Kaswa

Corp.

Corp.

v. Sup.

523 ..................................................................................
Ins. Exchange

Zoran

Corp.

185 Cal.App.4th

of Scientology

7, 10, 17, 30

24

(1999)

1012 ................................................................................

v. Chen

11

(1994)

1415 ................................................................

v. Church

69 Cal.App.4th

6, 7, 8

Ct. (2000)

Wight v. Street (1935)

3 Cal.2d 146 .............................................................................................
Wollersheim

17, 18

(2008)

1510 ........................................................................

v. Farmers

24 Cal.App.4th

Inc.

17

(1989)

772 ...........................................................................

162 Cal.App.4th

10, 11

10

(2010)
799 ................................................................................

11

Wechsler
v. Macke International
Trade, Inc. (Fed. Cir. 2007)
486 F.3d 1286 ..........................................................................................

22

Federal

Cases

iii

California

Statutes

Code

of Civil Procedure

187 ............................................................

Code

of Civil Procedure

904.1

6, 7, 10

...................................................................

Corporations

Code

202 .............................................................................

24

Corporations

Code

17002 .........................................................................

24

Evidence

Code

452 .....................................................................................

Evidence

Code

453 .....................................................................................

Evidence

Code

1220 ...................................................................................

Probate

Code

700,

Probate

Code

15203

Federal

Statutes

et seq ..........................................................................

28

.................................................................................

24

26 U.S.C.

671,

et seq ................................................................................

29

26 U.S.C.

2702

...........................................................................................

Secondary

Authorities

34 Am.Jur.2d

Federal

34A Am.Jur.2d

Federal

15 Cal.Jur.3d
Bogert,

Lee,

"Offshore

Tolerance
Ross

(Juris

Asset
in Estate

and Cohen,

"'Tax
News

havens'
(June

(Thomson

of Low-Tax

Protection
Planning",

West

.. 18

2013)

Transactions

Trusts:

Testing

15 Bankr.Dev.J.

Practice

to clampdown

15, 2013)

28

...........

the

Probate

on tax

avoidance

(Rutter
and

..............................................................................

iv

28

Limits

451 (1999)

Guide:

3, 16

- 2nd Edn:

..............................................................................

California
agree

................................................................

and Trustees
Taxation

2011)

3, 28

........................................................................

of Trusts

International

Anguilla.

...............................................................

Taxation

Corporations

The Law

Campbell,

Taxation

of

Judicial

...................
2013)
evasion",

27

......... 28
BBC
28

No. B241675

COURT

OF APPEAL

SECOND

OF THE

APPELLATE

STEPHEN

STATE

DISTRICT,

M. GAGGERO,

OF

CALIFORNIA

DIVISION

Plaintiff

EIGHT

and Appellant,

V,

KNAPP,
PETERSEN
& CLARK,
STEVEN
RAY
M. HARRIS;
ANDRE
JARDINI,
Defendants

Appeal

from the Superior

Court
Los Angeles
Superior
Honorable

of California,
County of Los Angeles
Court Case No. BC286925

Robert

L. Hess,

APPELLANT'S

This
debtors,

and

appeal

is from

substantially

arising

from

section

904.1 (a)(2).

Dept.

OPENING

STATEMENT

BRIEF

OF APPEALABILITY
amending

a judgment

affecting

the

and

and

rights

is authorized

STATEMENT

OF THE

entered

in favor

of respondents

Clarke,

Stephen

Ray

Garcia,

Stephen

M. Harris,

against

appellant

M. Gaggero

in February

of consistency,

Gaggero's

of the

of Civil

parties

Procedure

CASE

was

the sake

to add judgment

liabilities

by Code

Judgment

For

24

an order

the judgment,

Stephen

GARCIA;
STEPHEN
and Respondents.

Knapp,
and

Andre

2008.

record

(JA2

citations

Petersen
Jardini

&
and

421-423.)

are

in the

same format used by the other ten appellants

in their opening
brief: Citations
to "JA",
"Trial
RT" and "Opn."
refer to the joint appendix,
reporter's

Respondentswere thereafter awarded$1,327,674.40 in attorney fees and

costsfrom Gaggeroin an amendedjudgment. (JA7 1884-1889.)This court
affirmed the judgment in May 2010, and respondentswere thereafter
awarded$193,245.90in appellatefeesandcostsplus $320,591.78in interest
in a secondamendedjudgment. (CT1 114-116.)
In April 2012, respondentsfiled a motion to further amend .the
February2008 judgment to add ten Entities2 asjudgment debtorsbasedon
the groundthatthey wereGaggero'salter egosandwerethus thereal parties
in interest.(CT1 24-CT3 376.) Gaggeroandthe Entities separatelyopposed
the motion. (CT3 379-396,397-422.)
On May 29, 2012, after oral argument, the trial court granted
respondents'motion and amendedthe judgment to add the ten Entities as
judgment debtors.(CT3 540-542.)Gaggeroandthe Entities filed this appeal
on June1, 2012.(CT3 543-545.)
STATEMENT OF FACTS
Appellant StephenGaggerowasa successfulreal estateinvestorand
developerwho owneda numberof propertiesin the Los Angelesareaby the
mid-1990s. In 1997, he transferred title to several of those properties to

transcript and opinion from Gaggero'sprior appeal,B207567. Citations to

"CT" and"RT" refer to the clerk's transcript andthe reporter'stranscript in
the present appeal. Gaggero respectfully asks the Court to take judicial
notice of the briefing, recordanddecisionin thatappealpursuanttoEvidence
Codesections452, subdivision(d), and453.
2 The entities are Pacific CoastManagement,Inc., 511 OFW L.P.,
GingerbreadCourt L.P., Malibu Broadbeach,L.P., Marina GlencoeL.P., Blu
HouseL.L.C., Boardwalk SunsetL.L.C., andJosephPraskeasTrusteeof the
the

Giganin

Trust

("Giganin"),

Aquasante

Foundation

order
and
"Entities".

judgment.

the

Arenzano

("Aquasante").
This

brief

They
shall

refer

Trust
have

("Arenzano")

also appealed

to them

and
the May

collectively

as

the
29
the

various limited liability companiesand limited partnershipswhich hadbeen

createdon the advice of his estateplanning attorney, JosephPraske,for the
benefit of his family. (Trial RT1 602-604; Trial RT5 2720; CTI 124-125;
CT3 411.) Respondentsestimatedtheir value as of
$40

million,

though

encumbrances.

(CT1

Gaggero

no longer

Entities.

(CT1

6, 40:4-6,

they
28,

42:15-16;

CT3

to Praske's

his ownership

interest

as part of his estate

360-CT3

370.)

owned

33:13-15,

432:11-12.)
(CT2
Personal
subd.

Residence

(a)(3)(A).

lawsuits

2000,

in which

January

2002,

908-909,

2002

3 A QPRT
personal
before

Am.Jur.2d

Federal

(Thomson

West

a party.

Taxation

created

(CT2

191 - 193.

Gaggero

no

29:1-4,

longer

29:21-22,
432:9-10,
to Giganin.

is a Qualified

of 26 U.S.C.

2702.

40203;

4616;
them

RT2

there

Trial

for

takes

(26 U.S.C.
Bogert,

Trial

him

for a fixed

The Law

In
RT3

5750.)

malpractice

ownership
2702,

(Trial

RT10

legal

in five

610-615.)

out of his cases.

RT8

against

to live

to represent

521-534;

trust which

him

1201.)

432:11-

had also

Giganin

respondents

Trial

to the beneficiaries.
2013)

36:2-

transferred

in Ventura

that

respondents

this action

allowing

32:4-5,

432:7-9,

the meaning

(JA2

1288-1289;

is an irrevocable

residence,
title passes

hired

substituted

he filed

432:3-5,

his residence

within

to those

193-194.)3

Gaggero

appellant

that

(CT 1 28:6-8,

conceded

("QPRT")

he was

1278-1279,

December

have

that

then

Praske

both

CT3

conceded
them

and Aquasante.

conceded

other

432:9-10,

Gaggero

to

or

31:18-20,

which

Arenzano

42:15-16;

(CT 1 31; CT2

In August

to trusts

transferred

Trust

he ' transferred

advice,

after the transfers.

Respondents

mortgages
have

31:11-12,

planning

have

36:2-6,

at $35 million

430:20-21,432:5-7,

including

He separately

193-196.)

after

31:8-11,

in the Entities

or LP's

for

Respondents

properties

estate

Respondents

account

432.)

428:15-17,

plan,

the LLC's

31:12-18,

the

29:21-22,

12.) Pursuant

not

31; CT3

owned

28:2-6,

did

1997

In
and

of the settlor's
period

subd.

of Trusts

of years

(a)(3)(A);

34

and Trustees

breachof
2007,

contract.

until

10 of that

The

court

disparaging
necessary

Gagger0's

In May

$1,327,674.40
1884-1889.)

(Opn.

at 21-23.)

time to award

(CT1

24-CT3

limited

and

judgment

and

costs,
2010,

this court

a further

2012,

respondents

a third
376.)

time

These

is not

in which

liability

by adding
Entities

consist

appellant

is not

in which

4 trusts

469-471,473,481.)
admitted

They
had,

Cal.App.3d

was

was

421-

an award

of

agreement.
judgment.

amended

a second

and appellate

appellant

of which

As the
its truth.

fees

he was

Code,

(Gelfo

v. Lockheed

Martin

offered

no evidence

that any

their
752,

admissions
757.)

would

Entities

or

their February

as judgment

the

employee;

four

or

partner;

limited

settlor

but

sworn testimony
(CT 1 31 ; CT2
of that
1220;

trump

(2006)

of the trusts

limited

the

by Gaggero
193-194;
CT3
respondents
Const.

is revocable.

Co.

v.

720, 752.)
as an issue

140 Cal.App.4th

it. (In re Vincent

two

is neither

evidence,
Fassberg

of

or manager;

(2007) 152 Cal.App.4th

and "removes
the matter
Corp.

debtors.

corporation

is not a member

proponents

(Evid.

to amend

a general

Housing Authority
of City of Los Angeles
The admission
has a "conclusive
effect"

if they

than

(JA2

retainer

in interest

officer,

4 Respondents'
own papers
contained
Praske that the trusts were all irrevocable.

47-48.)

Gaggero.

of a management

and

in the case."

length

the amended

a motion

the ten

a shareholder,

companies

irrevocable

brought

three

judicially

decision,

5, 2008, the court

parties'

the judgment

$513,837.68

of

to include

affirmed

and

373,

greater

against

on the

on

147; JA2 366.)

statement

amended

of

of judgment

On February
and

based

2010,

JA1

at far

60-91.)

was

entry

32-page

credibility

(CT1

In December

appellant

partnerships

wrote

for

in the summer

114-116.)

In April

which

the

In May

(CT1

judgment

5737-5738;

RT10

of respondents

respondents

2008

(Trial

in favor

in fees

(JA7

moved

ethics

2008,

19.) The case was tried

successfully

its decision.

judgment

and costs.

year.

CT1

subsequently

to justify

entered

1934;

respondents

September

423.)

(JA7

34,

But even

B. (1981)

125

trusteenor a beneficiary,s (CT3

Respondents'
information

they

2008,

or even

as try

to explain

During
they

motion
had

after

the 2007
already

motion

but

from

Gaggero.

Trial

RT6

they

trial,

their

that

3005,

the

parties

in interest

opposed

the

that

court

the

sufficient
estoppel

court

was

grounds.

debtors.
appealed

and

already

they

Gaggero's

alter

ego

(CT1

entered
They

the

bringing
not only

in their

Entities'
Trial

any

in February

before

used

on

did not so much

showed

later

it.
that

alter-ego

separateness

RT5

2769-2773;

that the amendment

egos

24-42.)

that

it sought

to do
(CT3

based

4814-4816.)

were

authorized

was

2012

2132-2134;

motion

grounds

April

disputing

RT9

action.

2007.

arguments

that

1836-1839,

of alter

(CT3

389-92,

and

thus

Gaggero
outside
387-89,

407-09)

was

actually

the

and

Entities

the

reverse
404-07)

and

proper
real

piercing
it lacked

it was barred

on

392-94.)

was

heard

the judgment

this order.

until

in their

not

(RT 25-28;

waited

Trial

it
was

in September

alleged

(CT3

motion

ordered

RT4

on the

evidence

The

were

that

the judgment

information

in this

motion

claim

questions

3067-3068;

Entities

after

had

they

(Trial

411-413.)
not

ended

why

Respondents
because

obtained

all the

also

did

the trial

had

395,

and

amended

CT3 540-42.)
(CT3

granted

on May

to add

On June

the

1, 2012,

29, 2012.
ten

Entities

appellant

(RT

1-28.)

The

as judgment
and the Entities

543-45.)

//
//

5 Though
trusts.

(CT1

nominally

31:23-24;

CT2

a foundation,
193:8-16.)

Aquasante

is one of the irrevocable

ARGUMENT
I
THE

TRIAL

PIERCING
FOR

COURT
TO HOLD

THE

of discretion.

decision

amending

a judgment

judgment

debtors.

Marconi

Conf.

discretion

is broad,

perform

Corp.

Greenspan,
times

to name

supra,

that

29:21-22,

36:2-6,

40:4-6,

piercing,

the court

does

would

clear.

Gaggero
outside

reverse

governing
liable

case

piercing
law,

the motion

deemed
debt.

(CT3

to amend.

1551,

of

Postal

Inc.

1554.)

v.

That

Press,

1512-13,

1518

Respondents
assets

31:18-20,

to impose

legally

opposition
but

("PIP");
many

(CT1

28:2-8,

33:13-15,

432:3-5,

432:5-7,

allowed

reverse

it here. Gaggero's

abuse

of its discretion

and factually.

that

California

law

the

trial

ignored

his alter

RT 12-14,

v.

32:4-5,

law

the court's

Inc.

conceded

or their

if California

both

liability

Instant

430:20-21,

makes

540-42;

& Barker,

an

Entities

387-89),

as additional

from

all of the Entities

(CT3

Haisley

by

transfer

had no discretion

in his

circumstances,

the

428:15-17

was wrong,

to

not

31:12-18,

in the Entities

necessary

alter egos

1510,

so even

have

explained

for his personal

in granting

CT3

508

may

at 513.)
the

486,

limit is that the court

he owns.

31:11-12,

Its ruling

for abuse

One

Cal.App.4th

not own

in some

Cal.App.4th

limits.

that

432:11-12),

lack of any ownership

more

162

to use all means

Goodhue,

piercing

entitles

42:15-16;

432:9-10,

even

veil

31:8o11,

432:7-9,

have

is reviewed

191 Cal.App.4th

debtor's

41

LIABLE

OF APPELLANT

debtor

including,

191 Cal.App.4th

Gaggero

29:1-4,

(1996)

but it does

(2008)

discretion

REVERSE

ENTITIES

DEBT

the original

Bd.

reverse

PARTY

(2010)

187; Hall,

Center

to business

Kaswa

has

effect

(C.C.P.

outside

individual

v. LADTLLC

into

OUTSIDE

to add a judgment

A trial court

its jurisdiction

THIRD

JUDGMENT

(Greenspan

("Greenspan").)

IN APPLYING

THESE

PERSONAL

A trial court's

carry

ERRED

court
egos,

16-28.)

forbids
the

and held

them

The court

erred

Code of Civil Proceduresection 187 "has never been construedto

allow imposition of liability on an entity which was never a party to the
action." (Triplett

v. Farmers

1420.)

Cases

using

"section

debtors

have

always

been

party

and

judgment

the

new

to add

that the

court

merely

187 to add
rooted

party

were

an alter

Exchange

in the

parties

'alter

ego'

one and

the

is an equitable

is not amending

the judgment

the

Haisley

& Barker,

at 1555

[citations

correct

name

of the

Inc. v. Marconi

(1994)

new

ego

inserting

There

Ins.

Center

that the Entities

were

agreement

there

any

that

the judgment

was

were

the

cost

awards.

421-23;

part

dispute
and

respondents'

motion

personal

of this action,

to hold

supra,

by

itself,

Entities
that

settled

business

It necessarily

to hold entities

to amend

a new

of a

on the

theory

defendant
(Hall,

entities

but is

Goodhue,

41 Cal.App.4th

concession

defeat
is a

that he is a member

or general

partner

the trusts.

There

of the LP's,
is simply

1884-89;
sought

CT1

is
as

114-116.)

to impose

liability

who had never

been

may not

be applied

for the

of their

owner.

debt
supra,

likewise

of someone

cannot
who

Gaggero

officer,
or manager

or

between

use reverse

did

more.

not

at

piercing
Even

any

of the

was no evidence

employee

Gaggero

(PIP,

owner.

own

There

of the LLC's,

in

191 Cal.App.4th

is not their

or that he is a trustee

no nexus

Gaggero,

ego doctrine

But there's

shareholder,

against

Nor

up to it.

that

the judgment.

JA7

Greenspan,

that courts

respondents'

only

on ten Entities

liable

to the underlying

and respondents.

entered

leading

at 1512-13;

follows

not parties

Gaggero

that the alter

for the debts

Gaggero

based

Bd., supra,

undeniably

debt

liable

would

corporation,

(JA2

judgment

162 Cal.App.4th

513.)

between

or of the events

It is also well
reverse

judgment

"Amendment

defendant."

Conf.

1415,

that the original

(Id.)

to add

or to the retainer

for appellant's

concept

procedure

case,

Thus,

as additional

same."

real

Cal.App.4th

omitted].)

is no dispute

fee

24

of

the

defendant

that he is a limited

or beneficiary
and

of any

the Entities

of
that

could justify addingthem to thejudgment.

Califomia courts are not authorizedto amenda judgment against an
individual to add an entity as a judgment debtor under a reversealter ego
theory. "[A] third party creditor may not pierce the corporateveil to reach
corporateassetsto satisfy a shareholder'spersonalliability." (PIP,
162 Cal.App.4th

"In

at pp. 1512-13.)

Postal

lnstant

Cal.App.4th
that

permitted

to satisfy

the court

the

individual

under

ownership

over

Palmas

Assoc.

1251)

and since

ego

40,

respondents'
debtors

in fact

Greenspan
piercing
24-28.)

- and

clear
and

supported
The
the

sought

make

trial
court

not

by respondents

not be
Rather,

will only be applied

the

corporate

for

that

rule

since

(1991)

debt

at 513-14.)

liable

additional

the

debts

requires

judgment

of

an

common

debtors

(Las

1220,

1249-

235 Cal.App.3d

even

then.
against

it accepted

request

for such

erroneously
that

the judgment

if it sought

prohibition

Greenspan,

held

held
is not

will

191 Cal.App.4th

to amend

perhaps

court

162

has no owner.

sense

their

veil

disregarded

and

makes

judicial

veil

for a corporate

rule,

thusly:

of Appeal

shareholder.

entities

Ctr. Assoc.

motion
only

(2008)

liable

(2010)

original

an individual

in PIP

41-42.)

the

v. Las Palmas

the

delineated
cases

both

Corp.
corporate

ego doctrine

the single-enterprise

doctrine

disregard

cannot

explained

is, the corporate

has

supra,

later

96, the Court

of the

shareholder

individual

likewise

as judgment

that

the alter

(Greenspan,

Courts

v. Kaswa

piercing

an individual

where

Inc.

was

the debt of an individual

explained,

to hold

alter

reverse"

in California,

pierced

Yet,

Press,

1510, 77 Cal.Rptr.3d

"outside

form."

The holding

supra,

here.

Not

only

claim

40-42;

piercing.

and

relying

to perform
CT3

of the

did respondents

respondents'
reverse

Entities

application

reverse

authorized

(CT1

reverse

outside

agreed,

it was

to add the

428-431;

piercing
that

(CT1

these
34-35,

expressly
the
RT

on

reverse
12-14,

The court's ruling was error on two critical points. First, as noted
above,Greenspan
court

unequivocally

is not authorized

individuals;

rather,

circumstances
satisfy

to use outside
the

against

a corporate

affirmed

alter

ego

reverse

doctrine

a corporation's

debt.

the prior holding

piercing
may

owners

(Greenspan,

to satisfy

only

the

be applied

and/or

supra,

of P1P that a trial

sister

debts

of

in certain

corporations

(2010)

191 Cal.App.4th

a request

for reverse

to

at 513-

14.)
Second,
hold a third
standard

Greenspan

party

liable

application

did not involve

for the debt of an individual.

of alter

of two corporations

liable

of the

single-enterprise

same

owner

as

ego - a request

rule
the

to hold

original

with

the owner

from

(Id.)

Since

provides

no support

the reverse

court,

California

law expressly

on this
amending

//

in order

to hold

The trial
basis,
the

and

court
the

did not

judgment

decision

with use

which

had

the

which

was

used

to shield

the

owner

involve

reverse

piercing,

that it had the power

of respondents
prohibits

a third
was

court

debtor

the

and affiliates

- along

and

to

it

to order

ego here.

to the argument

individual.

//

of alter

Contrary

doctrine

reversed.

Greenspan

involved

company

debtor

and the original

for the trial court's

application

corporations

a sister

judgment

interchangeably
his debts.

liable

Greenspan

to hold the owners

for the debt of those

piercing

party

reverse
liable

not authorized
abused

to add

the

and

finding

application
for the
to grant

its discretion
Entities

the

by

of the trial

of the alter

personal

debts

the motion
doing

as judgment

of an

to amend

so. The

debtors

ego

order

must

be

II
THE

EVIDENCE

WAS

TO SUPPORT
Even
doctrine,

if California

which

not support

making

This
the

trial

court

court

considered

of the decision,
trial

court

v. Reed(1997)

16 Cal.

Under
its authority
litigation,

Code

was

197 Cal.App.4th
party

be

controlled
order

the
the

to satisfy

addition

evidence

ego

whether
are

1073.)
of

fell far short

concerns.

ego

in it."

(Misik

and
had

(2)

in favor

findings."

the

the

(Lake

at 1421

may exercise
control

v. D'Arco

the

opportunity

24 Cal.App.4th

findings.

of the
(2011)

(1) that the new

new

party

had

to litigate,

considerations

[emphasis

any of these

had

both

that

alter ego issues."

10

in the

before

court

who

The due process

//

v. City of

be resolved

187, "[t]he

this "requires

//

have

Conflicts

those

of, the threshold

of supporting

1014-

could

"if the evidence

an alter

having

1012,

omitted].)

section

party

evidence.

(Kazensky

must

of law to sustain

old

thereby

due process

supra,

the

which

fact

omitted].)

be overturned

However,

of

value."

therefrom

represented

upon

substantial

trier

53 [citations

upon

would

69 Cal.App.4th

of solid

[citations

court

findings

by

reasonable

Procedure

liability

factual

(1999)

drawn

may

the

supported

and

4th 448, 457

litigation,

to, not in lieu

Ins. Exchange,

debtors.

44,

therefore

1065,
alter

judgment

as a matter

of Civil

to impose
and

additional

inferences

is insufficient

of the alter ego

to the trial

credible

but a decision

application

presented

if any

65 Cal.App.4th

or reasonable

reverse

of Scientology

it reasonable,

BELOW

evidence

determine

is substantial

(1998)

evidence

not, the

its decision

v. Church

"Evidence

Merced

must

RESULT

law permitted

the Entities

based

(Wollersheim
15.)

it does

THE

INSUFFICIENT

( Triplett
added].)

in

are in

v. Farmers
Here,

the

A.

There

is No Substantial

Gaggero's
The
were

first

requirement

Gaggero's

to invoke

Alter

the

alter

ego

between

the

personalities

do not

exist,

fiction

of separateness

D'Arco,

supra,

(2000)

for

the

use

also

"[n]o

of one

Cal.App.4th

factor

Here,

let alone

substantial

Aside

from

payments
cover

some

of

Sonora

such

the holding

that

seeking

of interest

that

their

and

separate

adherence
injustice.

Diamond

Corp.

separateness

exits,

as: "commingling
out by one

identical

equitable

shell

to the
(Misik

v.

v. Sup.

Ct.

and identical

The

list of factors

in

for the

the

affairs

directors

two
of the

formalities,
and officers."

"is not exhaustive,

Corp.

and

that it is liable

of corporate

records,

have

of funds

entity

or conduit

(Zoran

courts

ownership

disregard

is determinative."

motion

offered

initial
PCM
his

offered

and ownership

evidence.

They

from

factors

omitted].)

of interest

the

such

or promote

the appropriate

as a mere

respondents'

unity

Entities.

a fraud

The party

"a unity

show

the Entities

v. Chen

and

(2010)

185

establish

the

812.)

requisite

of the

show

also

at 1073;

of corporate

799,

must

capitalization,

[citations

single

inquiry.

individual

sanction

other,

"inadequate

at 538-39

first

and
then

entities,

the

lack of segregation
(Id.

and

at certain

of

entities,...and
other,"

entity

whether

of the two

debts

are

523,538.)

looked

assets

the Entities

had to prove

two-part

must

197 Cal.App.4th

In determining

other

respondents

This is itselfa

would

83 Cal.App.4th

traditionally

that

doctrine

ownership"

that

Egos.

was

alter egos.

Evidence

They

for Gaggero's
expenses

provided

transfers
services

6, respondents

6 See Part IV, below.

11

evidence

between

no financial

property

no

to

Gaggero

no evidence
records
in

of who owned

for any

1997

and

and - with
did

and the Entities,

not

of the
1998

Entities.

and

his own money

document

any

some
- to
single

transaction of any kind that any of the Entities had ever carried out with
anyone,let alonewith Gaggero.Their repeatedconcessionsthatGaggerono
longer owns the Entities or their assetsprovesthat there was no such unity
of ownership.
The bestrespondentscould do was to cite Galdjie
113 Cal.App.4th
is sufficient

1331,

to meet

liability."

(CT1

alter-ego

liability,

liability
pure

35:5-6.)

ownership

requirement

But Galdjie

so it says
Like

about

else

ownership

for purposes

says no such

nothing

so much

that "equitable

thing.

how

the

(2003)
in a trust

of alter

It wasn't

even

requirements

in respondents'

papers,

ego
about

for

such

this claim

was

fiction.

of each

argument

Merely

but they
calling

which

also

of the Entities.

37:10-12),

any

the

can be met.

This

after

1339 for the claim

v. Darwish

in the

that
twice

an "equitable

to the LP's

LP's

or LLC's

is the equitable
that he was

this claim

owner"

conceded

them

Gaggero
claimed

did not try to support

repeatedly

he transferred
interest

Respondents

Gaggero

respondents

presupposes

or even

does

(CT 1 35:5-6,

define

the term.

not overcome

- that he no longer
and LLC's,

owner

the facts

owned

his assets

or that he no longer

after

transferring

those

evidence

of

disregard

owned

interests

to the

trusts.
Respondents
formalities,

any

or assets,

any

another's

debts,

appellant's
to operate
of those
with

failure

etc.

separate

The

only

when

expertise
to

or the

facts

attorney

any

records,

of Gaggero

that Gaggero

the management

enough

out

planning

them,

no

to keep

holding

estate

Entities

real estate
nearly

produced

any commingling
Entities

respondents

Praske

transferred

of corporate

created
properties

as

liable

pointed
the Entities
he had

owned

company

for some

establish

lacked.

because

(CT 1 140; CT2 213-215,

a unity

of

12

interest

and

one
that

and continued

was set up, and that he contracted

Praske

for

to were

the estate

of the Entities

of funds

360.)

ownership

to some
to consult

he had

the

This is not
between

appellantandtheseEntities.

B.

There
Estate

Even

if this court

unity of interest
also

be

Is No Substantial
Evidence
That
In Order To Defraud
Creditors.
to find that there

and ownership

substantial

piercing

were

between

evidence

of the corporate
have

circumvent

a statute,

or accomplish

Co.

39

presented

290,

there must
"Traditional

remedy

when

the

individual

liability,

(Mesler

v. Bragg

purpose."

300-01.)

of

No

such

evidence

was

in this case.

Gaggero

Thousands

improper-motive

transferred

of people

Yet, respondents
estate

planning

must

have

working

done

to

by many

defraud

until 2000

a very different

that "a trust created

(ln re Marriage

(1993)

fraudulently-established

Cal.App.2d

708,

it must

f'md that

finding,

in turn,

the entity

was

be supported

144,

actually

created

by substantial

13

may

planning
not

begin

until 2008,

of this court has noted

creditors

(Kohn

the similar

them.

involving

a court

did

his creditors

Four

15 Cal.App.4th

But before

that in

planning.

estate

Respondents

to defraud

corporations.

of estate

appellant's

of defrauding

717-720.)

must

others,

in disputes

the fact

that, unlike

and did not become

for the purpose

of Dick

part

support

creditors.

plan

on

to the LP and LLC entities.

set a facts, Division

and may be disregarded"

based

as a routine

with no evidentiary
made

was

property

year

did not set up his estate

Under

is illegal

do this every

decisions

been

claim

title to real

insisted

for Gaggero

so he clearly

of

intent.

to evade

a wrongful

Cal.3d

evidence

and the Entities,

improper

form

Set Up His

substantial

as an equitable

the corporate

(1985)

Respondents'
1997

an

is justified

shareholders

Management

abused

appellant

showing

veil

was

Gaggero

or other persons

the defrauded
161.)
v.

The
Kohn

disregard

to defraud
evidence.

same
(1950)

party.
is true
95

such an entity,
someone.

That

Respondents
Indeed,
(CT3

they

did not claim

expressly

426:24-427:1.)

determined"

denied
They

and was

"clearly

based

on a paragraph

or about

fraud.

(CT3

not bind

being

added

the Entities,

May

formal

order,

Neither

the

any

was

order

nor

to commit

plan

the

"to

27:25-28:1)
Protecting

said nothing

issue

either

about

been

statement
the estate

legitimacy

the statement

who

were

still more

than

four

order

(CT3

540)

nothing

of
plan

of the

it was not relevant

Further,

sort.

had "already

the

the trial because

of the

8, 2008

fundamentally,

(JA 1 1-25.)

7, but

for the estate's

hearing,

the

against

him,

beyond

the

opportunity

7 The

court
and
reach

below.

from
he had

So even
What

that
also

to any

of decision

years

away

from

order

says

court

said

does

counsel.

(CT3

anything

Gaggero

had

of estate

planning,

used

2000-2001

to defraud

his
(RT

creditors.

as long as it is done

Gaggero's

is whether

Gaggero

earlier.

the plan

court's

541-542.)

15 years

created

matters

the

about

in August

if this was

a fraudulent

Neither

that

creditors"

about

goal it would

his intent

was

not

fraudulent.

it.was.

said

he has

that

Gaggero

attempted

of legitimate

to litigate

court

trial

purpose

beneficiaries.

Entities.

he set up the estate

his assets

did not say

says

by respondents'

minute

when

is no evidence
The

the

is the very

the result

or other

drafted

fraud

shield

assets

(RT 28:1-3.)

anything

by the January

More

of the trusts

which

During

There

29 minute

behind

intending

set up fraudulently.

to prove

that the fraud

which

of action.

had been

to the case.

The
purpose

had

resolved"

427:2-13.)

causes

could

justify

they

plan was not at issue during

of Gaggero's

estate

that

also insisted

decision,

estate

that the trusts

this."

to use

creditors,
(RT

said that Gaggero

26:3-7.)

"has

this

these

devices

14

judgment

to put his

assets

and

we have

had

a full and

But

Gaggero

had

transferred

had said this during

He did not.

substantial

cross-examination.

fair
his

assetsto the Entities between1997and 1998- morethana decadebeforethe

judgment was entered. To infer that a debt he incurred in 2008 is what
motivated him to createan estateplan in 1997is ludicrous.
The court gaveno hint of which "legitimate creditors" Gaggerowas
supposedlytrying to thwart whenPraskesetup his estatein the 1990s.Those
creditors could not have included any of the respondents,who first began
working for him morethantwo yearslaterandwho only becamehis creditors
eight years after that. Respondentslikewise identified no such creditors.
Their paperssay nothing about anyoneelse having claims againstGaggero
when he setup the estate.There is no evidencethat any prior creditors had
ever brought a fraudulent-transferaction involving any aspectof the estate
plan or otherwiseclaimed that the plan wasdesignedto defraudthem.
The only creditor from that period the record reveals is the Venice
North BeachCommittee("VNBC"), which was awardedabout$100,000 in
attorney fees and costsfrom Gaggero in 1995 - a judgment that was on
appealwhen he setup his estate.(Trial RT2 613-14; CT1 30.) Thatjudgment
was the result of errorsby ShermanStacey,Gaggero'sattorney in that case
- as he later proved by winning a malpracticejudgment in the amount of
$350,000againstStacey,in a casewhererespondentsrepresentedhim. (Trial
RT5 2480.)sThe trial court acknowledgedthejudgment in Gaggero'sfavor
and that Gaggerohad paid VNBC in full. (JA2 404 fn. 18, 407.) The trial
court did not find that the estateplan was designedto thwart VNBC, and
respondents'motion did not claim that it was. Thereis no reasonto think he
partedwith over $35 million in assetsto evadea $100,000debt.
Marriage
required.

To

of Dick,
take

s The VNBC
and

costs,

but

supra,

two

judgment

by the time

is instructive

examples:

The

had grown

of the Stacey

husband

to $170,000,

verdict

15

about

in 2001.

what

type

in that

of showing
case

including
(Trial

RT3

owned

interest,
1608.)

is
an

fees

English manor house on the Isle

residence
house

until

recently.

belonged
9 But

house

his,

was

he had
and

corporate

entity

separate

ownership.

metropolitan
Alkobel

Denver,

after

bank

that he was

no reason

along

money;

in the 1990s.

and

(3) at least

None

or that the Entities

in the estate

be true

been

could

deem

intent.
such

It didn't.
intent.

They

estate

which

even

and the court

and

the

fact

simply
that,

such

no such

later,

the settlor

with

that

trust

is distinguishable

16

to pay

It certainly

creditors

when

(2) he owes
them

an3;one

That would

them

only

Before

it

had to find such

had to prove

less prove

it. Instead,

the complexity

Gaggero

cannot

to a QPRT

in a residence

Gaggero's

of

presently

like Giganin,

after

(Thomson
West
settlor is a further
from

who

in 1997 or 1998,

creditors.

from

he

in full.

respondents

intent

is no hint that the trust was analogous

Giganin.

trickery.

estate;

much

9 There

relationship

the

the trial court

intent,

living

a loan by telling

that (1) he has creditors

permits

to continue

called
But

to defraud

finding,

years

in

(ld. at p. 163.)

to defraud

such

of a

houses

an entity

for his debts.

egos,

(ld.)

defrauded

the intent

a
the

appearance

by

stake.

afford

it. (Bogert,
The Law of Trusts and Trustees
Dick's
insistence
that he was not the trust's
with

owned

set up the

inferred

fifteen

the

one of the largest

it shows

alter

allege

that

to create

reveals

to get an alter-ego

didn't

created

are responsible

Gaggero's

In order

he had

was

Gaggero

let alone

showed

was trying

set up with

the Entities

respondents
the

had

case

settlor,

that the

that

used

he cannot

that

the

he had obtained

he had

for now,

of this means

if they

also

At most,

after

his principal

of Jersey

sole owner.

Gaggero

been

government

had no ownership

in the present

years

the

he claimed

still the property's

many

not even

in order

sale to Alkobel,

to believe

set up his estate

told

The husband

which

had

at p. 162.) He told the court

of its purchase

he supposedly

evidence

which

he was

it for him

the supposed

The

came

records

(ld.)

in which

of which
previously

to buy

even

gives

(15 Cal.App.4th

to a trust

beneficiary.

of Jersey,

transferring

2013) 1201.)
reason why his
relationship

afford to pay a seven-figurejudgment in full. That inferenceis manifestly

unreasonable,andit cannottake the place of substantialevidence.

C.

The

Court

Control

Expressly

Gaggero's

Evidence
However,
evidence

even

of unity

substantial
underlying

litigation.

Cal.App.4th

at 1421.)

A trial court
debtor's

(Id.; NEC

Electronics

the

court

trial

controlled
was

19, 36:23,

37:21-22,

never

was

had asked

alter-ego

liability

supra,

24

here.
if it really

given

Here,

Gaggero,

not only

for. (CTI

is

litigation.

772,778-79.)

debtor,

be
the

the underlying

finding

also

controlled

- even

CT3 424:10-11,428:25-26.)

to impose

Cal.2d

where

action.
172,

exercised

alter

afforded

underlying

alone

correct,

but

28:10-11,29:18lThe

Gaggero's

over

claimed
34:20-23)

court

simply

control

of his

Such

the litigation,

could

sleight

to litigate

no

as a judgment

acknowledging

be added

because

permeated
17

Court
that

the
motion.

who
in the

(1958)

the

51

Entities

to represent

ego who controlled

debtor.

Gaggero
their

interests

had the ability

that only an alter

without

of hand

their

evidence

let alone

admitted

to add a new party

S. A. v. Superior

.produced

can be added

breath,

the Entities

right

De Mexicali,

actually

litigation
next

it is improper

process

Respondents

any control

in the

due

(Motores

176.)

the underlying

ego is proven,

the

10 Respondents
But

debtor

judgment

This

must

lawsuit.
Even

was

38:1-4;

Not

substantial

Exchange,

208 Cal.App.3d

the one respondents

had no discretion
own

540.)

there

was presented

it controlled

original

was

actually

Ins.

a new judgment

the

Did

Is No Substantial

there

that

Farm_ers

Inc. v. Hurt (1989)

(CT3

that
intent,

no such evidence

that

Entities

There

to find

improper

ego - unless

the litigation.

And

the Entities

v.

not add

alter

found

also precisely

an

it was

Again,

may

were

and

(Triplett

The

Did.

if this court

to prove

That

Litigation,

They

of interest

evidence

the original

That

Found

(CT1

34:18-20.)

contradiction,

controlled
(See

them.

they
(CT1

Part IV, below.)

their interestsat trial or at any other

argued

it was

Entities

had

37:21-22,
was

Gaggero

who

no control

over

38:1-4;

appellant

CT3

who

proceeding.

controlled

the

the litigation.

To the contrary,
Entities,

(CT1

28:10-1

424:10-11,428:25-26.)

controlled

thereby

The

the litigation,

respondents
conceding

l, 29:18-19,

trial

court

not the Entities.

36:23,

also

(RT

the

found

12-14,

it
16-

28.)
Finally,

these

beneficiaries,
the same

and

other

improper

of the

interests

original

party.

at 780-81;

application

of alter-ego

to do so would

create

entity

would

an

stockholders",
scenario

alter

similar

ego

are

represents

undisputed

the Entities

their

violate

their

["the

obligation

differing

had

trial

thus

the

court's
court

finding
held

underlying
even

if the

insufficient
The

order

that

was

the Entities

it was

Gaggero

and

so the Entities

were

prohibition
as a matter

them

208

pierced

or

corporate

and

and

Here,

its

it is

no ability

any

its

defendant

at 780.)

under

on

"contrasts

defendant

(Id.

of

the corporate

like NEC,

litigation,

no substantial

that

litigation

amending

adding

as

theory

to

would

rights.

At the end of the day, there

trial

the

not be

corporation

case,

ego."

411-413.)

30, Extent

will

of the

alter

not

supra,

to disregard

innocent

over

(CT3

v. Hurt,

of the corporate

of the

clearly

are not the same

veil

This

partners,

were

Corporations

strategy

no control

interests,

due process

an

omitted].)

the interests

Inc.

as where

on

the

interests

corporate

the interests

so that

interests

Electronics

15 Cal.Jur.3d

members,

litigation.

whose

an injustice

where

effectively

litigate

(NEC

footnotes

with the usual

whose

debtor

doctrine

where

shareholders,

in the underlying

see also

inflict

have
creditors

to add a new

Cal.App.3d

minority

all

innocent

as appellant's

It is again
those

Entities

on reverse

were

the judgment

Gaggero's

not

must

18

alter

the Entities

were

the trial

ignored,

court's

be reversed.

to support

egos,

who

not the real parties

piercing

of law to sustain

evidence

and

the

in fact

controlled

in interest.
the

finding

the
Thus,

evidence
of alter

is
ego.

III
THE

RELIEF

WAS

BARRED

SOUGHT

Respondents'
filed

in April

Gaggero
case

motion

of 2012.

earlier
2005.

(CT1

appellate

opinion

contained

They
but

also used
in

likewise

revealed

that remained

California

disputes

were

basic

had

recently

and Nevada

that had been just

entered

must

creditor
show

v. Abbey

offered

of state

(,lines

v. Abarbanel

that were

about

(CT2

357-CT3

377.)

in 2011

291-306,

about

several

from

the

they

the real parties

19

322-354.)

All

of

the

information

309-319.)

information

for why

2012

of the Entities

contained

after judgment

104 Cal.App.3d

(1978)

and

websites

to seek such relief

the necessary

no explanation

it was the Entities

(1980)

93-111,

material

to add new debtors

that he was unable

60-91,

(CT2

(CT2

none of which

anything

but which

in 2007.

seeks

of the Chimes

entered.

records

of decision,

debtor

Gaggero

downloaded

back

who

not do so at all if he had

was

public

was tried in

third-party

Entities.
with

consisted

or from the even

(CT1

revealed

had

the

the statement

2009

the

by the time

which

from Praske's

of

to

in this case,

information.

secretaries

as available

A judgment

Respondents

included

or the Entities.

they

some

case

was

relating

all of their evidence

judgments

any

no new material

respondents

judgment

also

facts

Entities,

No. BC239810,

transcript

with

the

the present

L.A.S.C.

an excerpt

that

relationship

(Alexander

from

evidence

had

these

Nearly

and prior amended

of discovery

assert

v. Yura,
Their

Records

may

trial transcripts

nothing

Gaggero's

which

including

of 2007.

MOTION
OF LACHES

to add these Entities

demonstrably

any new facts about Gaggero

114-116.)
exam,

44-54.)

they

planning,

case ofGaggero

JUDGMENT
DOCTRINE

to amend the judgment

was tried in the summer

and/or

POST

EQUITABLE

Yet,

and his estate

of deposition

been

BY THIS

BY THE

has

more promptly.
39, 48.) And

before

the original

77 Cal.App.3d
waited
in interest.

he

so many

702,

717.)

years

to

Gaggero's
their

motion

was further

respondents

argued

Gaggero's

with

entirely.
relevant

him.
the

excuse

In order
with

Chimes,

supra,

the judgment

if the

delay

elapsed

from

"after

delay."

them

In this

case,

relief

Respondents

for judgment

[citations
was

n The

that

respondents

know

the
had

since

required

reply,
if

a discovery

ignored

and

was

not

had

court

court

to add

an

Corp.

alter

(1994)

issue
all

the

they offered
to reject

the facts

is an

plaintiff

must

(Alexander

the

equitable

omitted].)

14, 21 .)
have

acted

v. Abbey

of the

A request

may

failed

promptly

the complainant

omitted].)

No one

factor

is determinative

but "the

length

of time which

the complainant
element

ego

23 Cal.App.4th

defendants,

unreasonable,

when

knew

where

or should

no reason

have

is suggested

be

in
has

known

of

for the

omitted].)
respondents

did not claim

was

later

in bringing
In their

did

trial

in as parties."

waited

of an amendment

they filed

they

they

at 48 [citations

is an important

(Id. [citations

equitable

a judgment

ascertaining

the time

facts..,

392-394.)

was entered

the trial

104 Cal.App.3d

(Id.

the

delay

of laches.

to bring

redress."

before

before

of new

to seek

because

shows

the addition

where

the

clearly

(CT3
because

Yet

Hotel

refused

assessing

1_ and

v. Barnabey's

diligence

respondents'

waited

427-428.)

of

"to justify

due

succeed

for delaying,

"Amendment
(Cart

had

evidence

on the ground

procedure."

that

for its denial,

they

(CT3

information

no plausible

grounds

would

Since

explained

only

appeal

dispute

motion

opposition

they

their alter-ego
granted

pending

to add
had learned
motion,

the

April

of 2012

Entities

information

at any time

of 2007.

from

the

debtors.
shortly

after their motion

As we have

did not stop respondents

to request

as judgment

any material

or even

in September

appeal

until

seen, nearly

taking

all

Praske's

third-party
debtor examination
on June 9, 2009.
did not even try to explain why they were willing

(CT2 357-CT3
377) They
to take that step while they

risked

alter-ego

losing

the appeal

but could

not bring
2O

their

motion.

of the evidencethey offeredin supportof their alter-egomotionpre-datesthe

September10, 2007 order grantingtheir motion for judgment and none the
few exhibits which arenewer than thataddedany material information. The
record is clear that respondentssimply sat on the relevant information for
yearsbeforefinally deciding to act on it.
The evidenceis undisputedthat Gaggero'sestateplanningtook place
in 1997,threeyearsbeforehehired respondentsas his lawyers.Respondents
hadfull knowledgeof his estateplan whenthey representedhim from August
2000 through January2002.This
respondents

years

it relevant.

There

shows

they

that

September

add new

all the

was

entered

judgment

debtors

the judgment

was

at 717.)
more

Respondents

years

in April

discovery

is no evidence
had

was
about

that they

relevant

filed

in December

these

Entities

bothered,

information

2002,
if they

giving
deemed

and

the

trial transcript

by the

end

of the

trial

in

2007.

Judgment

before

to conduct

action

before

2012

that

in February
if he had

entered.

failed

bringing

2008.

the necessary

(Jines

the Entities

alter-ego

were

creditor

information

v. Abarbanel,

to do so, and
their

A judgment

alleging

in fact the real

them

77 Cal.App.3d

delayed

motion,

to add

supra,

instead

may not

more

than

four

for the first time

parties

in interest

in this

case.
Respondents
bring

these

possession
the situation
party

knew

at or shortly
after

third parties
during

held

year

delay

the eight

or should

no explanation

in the case,

in Alexander

years

when

known

was

final

"in the absence

in moving

to seek

was pending.

of the Chimes,
of the facts

facts

where

explanation

the

abused

to

moving

until several

claim
years

debtor.

for nearly

to

in their

to the alter ego

ego judgment

court

so long

This is analogous

but waited

the trial

21

waited

supra,

relating

to add an alter

of any reasonable

for amendment,

they

they had the necessary

the case

v. Abbey

have

for why

after the time the case commenced,

the judgment

court

offered

The

a seven-

its discretion

in

granting this belatedmotion for amendmentof the judgment." (Alexander v.

Abbey

of the Chimes,

supra,

104 Cal.App.3d

The

same

result

is mandated

the relevant

facts

since

mid-2007

their judgment
which

they

was
twice

entered

CT1

ground

respondents

that

of their

unexplained

discretion
must

to bring

The

were
and

in granting

their

moved

114-116.)

Respondents

at the latest,

successfully

1884-1889;

here.

at 48-49.)

should
from

unreasonable

- a period

other

reasons.

have

been

denied

such

The

motion

relief

trial

of

four years

it for

seeking

delay.

belated

over

to amend

to amend

estopped

respondents'

but waited

motion

motion

had full knowledge

during
(JA7
on

the

as a result

court

to amend,

after

abused

and the

its
order

be reversed.

IV
TO AFFIRM
THE

THE

"California
remedy

and

(Wechsler
1295,

Cal.App.3d

Las

Gaggero's

estate

insinuation

and

planning

specious
irrevocable
confident

accepted

that

only

was

estate
his estate

plan

Palmas

Their

settlor's
with

Ctr.

strategy

was

courts

and

plan will be secure.

Estate

22

inference

planning

for

no

itself

that

resorted

the most
then

regard

evidence.

expected

mirrors,

235

nor caution.

without

distressingly

even

1286,

supra,

reluctance

respondents

are

foes can defeat

smoke

486 F.3d

a reasonable

improper,

cautiously."

Assocs.,

- of their

way

as a drastic

and

arguments

support

because

doctrine

Cir. 2007)

neither

the absence

in any

works
Ifa

Inc. (Fed.

displayed

could

ego

only reluctantly

v. Las

accurately,

innuendo.

challenges.

Trade,

THREATEN

IN CALIFORNIA

alter

all of respondents'

evidence
plan

the

form

The trial court

WOULD

PLANNING
treat

Assocs.

- or, more
no

FINDING

corporate

International
Palmas

it eagerly

With

generally

the

at 1249.)

the weakness

estate

courts

v. Macke

EGO

OF ESTATE

disregard

citing

Instead,

ALTER

INTEGRITY

to

effective.

But

to reject

such

thorough
settlor

and

can

will be crippled

be

in California if attackslike respondents'areallowed to succeed.

Respondents'strategywas straightforward.First, they usedthree full
pages of their motion to remind the court just how much it disliked and
distrusted Mr. Gaggero,cataloging findings and comments the court had
made abouthim years earlier at trial and in its statementof decision.(CT1
28:1-29:11, 33:12-34:6.) Not one of those findings or comments had
anything to do with how the Entities are run, so they shedno light at all on
whether any of them was Gaggero'salter ego. Their

only purpose

was

to fan

the flames.
Next,
estate

respondents

plan,

peppered

falsehoods

They

actually

then

plan

similar

will ever

plan.
be safe

four

years

reminding

financial
487.)

the

(CT1

their

Assassinating
no

with
his
matter

have

affirms

attack

and complex.

to do with whether

whenever

with

a mention

a lengthy

was sufficient

anyone

challenges

finding,

then no estate

diatribe

aimed

of any of the Entities

from

of the

the January

impressions

aspersions

in his estate.

8, 2008

it had

at Mr.

statement

formed

of Mr.

it had cast at him more

than

29:5-11.)
alter

(Minifie

character
how

all they

court.

are Gaggero's
him.

but

showing

the alter-ego

the

of any supporting

large

nothing

about

and outright

wrongdoing,

If respondents'

selectively
court

the lack

is relatively

will be sufficient

28:19-24,

the Entities

relationships

relationships,

ego.

the trial and the many

earlier.

Whether

estate

and complexity

with hardly
It quoted

during

to infer

in a California
began

28:1-29:26.)

Gaggero

trial

If this court

personally,

of decision,

despite

court

facts

conclusions,

deception

alter

showings

Respondents

(CT1

size

of innocuous

unsupported

Gaggero's

the settlor's

estate

Gaggero

the

that

an estate's

it is somehow

complex

tO suggest

was

a variety

innuendo,

persuaded

showed

Of course,

here,

with

designed

evidence.

presented

did

receptive

23

egos

v. Rowley
nothing
the

court

is a question
(1922)
to

about

their

187 Cal.

481,

illuminate

may

have

those
been

to

respondents' strategy. Respondents' tactic merely diverted the court's

attention from the lack of substantialevidence.(SeePart II, above.)Their
attacksshedno light at all on how the Entities operate.The only plausible
reason for this extended diatribe was to rekindle the court's disdain for
Gaggeropersonally in the hopethat it would carry over to the Entities in his
estate.12
Merely reciting respondents' arguments is enough to show how
devoid of merit they truly were.
They complained, for example, that Gaggero's estateplan was so
complex that it involved multiple Entities and "took several months to
implement". (CT1 36:1-7.) But as respondentsnote, Gaggero's estate is
relatively large and owns multiple properties. Large estates are often
complex.If complexity suggestswrongdoing,then every large estateplan is
in trouble.
Another innocuouspoint respondentsusedto their advantageis that
severalof the LP's andLLC's had been createdfor the purposeof owning
real property.(CT1 33:4-5 [asto the Entities generally], 38:23-24[as to the
Entities generally], 39:2-3 [as to Blu House], 39:3-5 [as to Boardwalk
Sunset],39:15-17 [asto Malibu BroadbeachandMarina Glencoe],39:18-19
[as to Malibu Broadbeach],39:21-22[asto Marina Glencoe],39:27-40:1[as
to 511 OFW andGingerbreadCourt], 40:1-2 [asto 511 OFW], 40:3-4 [asto
Gingerbread Court].) But owning property is a perfectly normal and
legitimate businesspurpose,especiallyfor anentity setup aspart of an estate
plan. (Corp. Code 202(b)(1)(A); Corp. Code 17002(a);Prob. Code
15203;Wight

v. Street

to hold property

12 Gaggero
doing

so would

(1935)

for benefit

does
serve

3 Cal.2d

146,

of settlor's

149-150

daughter].)

not list the many

no purpose.

24

accusations

[approving
Even

trust created

so, respondents

against

him here,

also

since

insisted, without evidence,that the sameEntities had

and

cited

were

the

supposed

shams.

(CT1

claimed,

checks

41:12-14;

also complained

that Pacific
is "owned

for his personal

expenses.

(CT1

bills,

to suggest
money.

food expenses,

32:7-8.)
that

PCM

was

"Gaggero

Gaggero's
provides

money
PCM

rather

than

and PCM

- which

trusts"
words,

issues

PCM

"pays

and

facts

out of context

in order

expenses

its own

his
that

its

they

bills,

Gaggero's
admitted

that

Management

In their

those

they

money

evidence

Gaggero's

32:5-9.)

presented

later,

by

purpose,

430:11-14.)

Coast

veterinary

financing

Just a few pages

with

dog's

But they

as further

CT3 424:17-20,

evidence,

(CT1

bills

purpose

without

his utility
a car."

of such

29:22-24,

Respondents
they

lack

no business

PCM

own.

writes

provides

checks

with

actually

In

him with

their

paid
own

these
words,

on his behalf."

(CT 1

38:4-5.)
They

even

"Checks
PCM

used
were

written

writes

utilities.
mean

Gaggero's

the

They
PCM

That's
their

pay

of financial

Since
affairs,

won

absence

to claim

that had been

took the same
pages

31-39

this Court

made

they

position

to role

against

brief
Gaggero

uses

are

pay

my

vet bills.
compan}

supposed

I
for

evidence

and

on that basis.

(Opn.

They

where

then using

Gaggero

the original

appeal.)

instead

ego. 13

took at trial,

RT6 3141-3144;
from

mingling

money

it is his alter

to reimburse

in the prior

to do for

the improper

respondents

(Trial

25

the money.

They

Gaggero's

that

to this very

appeal

me.

for my dog's

involves

the claim

not have

in Gaggero's

of respondents'

pay

companies

the stance

with PCM checks.

PCM

for

CT2 261:22-28.)

that PCM

objecting

their point:

are a management

citing

dooms

contradicts
should

they

relationship

the concession

by successfully

checks

They

management

of its own to pay his expenses

they

38:5-8,

an alter-ego

13 It also directly

card,

to prove

for it. I give

write

my life.

what

I paid

They

my credit

(CT1

exactly

clients.

by PCM.

checks.

manages

me personally."

own testimony

its

for payments
CT 1 86.)
judgment.

They
(See

even persuaded

at 21-23.)

Not contentjust with actively misleadingthe trial court aboutPCM's

role, respondentsthen set up a false contradiction between Gaggero's
testimony and their own distorted portrayal of his relationshipwith PCM.
They arguedthat
"Although PCM pays for all of Gaggero's personal expensesand
'manageshis life', Gaggero could not answer basic questionsare
relating [sic] the entity. Gaggero did not know whether PCM had
Articles of Incorporation, whether they were officers or directors, if
he was a directorTM, and when it was formed." (CT1 38:11-14,
citing
CT2 255-257.)
But
actually

this

were

would

mingled

that they

are not.

structure

and history?

position.

Only

refuses

(CT1

genuinely

"As

not

have

as much
a trust

as

Gaggero

in the

and has no standing

RB in appeal

order

to sway

later

supervised
- was

the

he did not know

the

assets.'

respondents
alter-ego
correct

trusts

owner

and

when
has

about

its

supports

his

transferred

all

foundation

he

he has 'no attachable

is that

of those

interest

[Citation].

in

they
'no

assets,

them.

Gaggero

Respondents

told this court

legal

He

Gaggero's

title

is not

that

or ownership

the

real

of the trust.

party

in

[Citations]."

at p. 35.)

actively

All he had been

motion

he had been

answers

Gaggero

to sue on behalf

B207567

the trial court.

whether

appeal,

the

of course,

attachable

in his prior

beneficiary,

again,

former

with the evidence

such details

asserting

implication,

the

interest

14 Here

discovery

affairs

otherwise.

entities,

an

trust

suggest

to various

The

But

know

"Because

to post-judgment

false.

client

that

interest
(See

24:1)

complained

if Gaggero's

consistent

did not have

spin could

in his assets

does

acknowledged

It is entirely

Gaggero

33:13-15.)

was

a contradiction

a business's

That

also

to respond

assertion

should

respondents'

interest

interest.'"

suggest

with PCM's.

Why

Respondents
ownership

only

distorted

Gaggero's

testimony

asked

- by the same

lawyer

who

with

CT1

He replied

that

(compare

a director

terminology

16.)

26

CT2

in 2000
to describe

248,
or 2001.

249:23

his role.

(CT2

in

255:6-

Respondentsused that argument to defeat Gaggero'sclaim that he

could recovercoststhat werepaid via PCM checks,so they not only know it
is true but actually usedits truth to their advantagein this very court. Even
so, their alter-egomotion insistedthat the claim was false andthat Gaggero
actually doeshavethe very type of interestthey previouslyconcededhe does
not have.
According to respondents, the fact that Gaggero and Praske
sometimesusedthe terms"Gaggero's personalestate"or "Gaggero'sestate"
showedthat he still hadimproperownershipor control. (CT1 37:13-20.)But
what elsewerethey supposedto call it? Whena casenamerefersto, say,the
"Estateof Smith", Smith is alreadydead.Evenso,by respondents'logic, that
choice of words must mean that Smith owns and controls his assetseven
from beyondthe grave. To call this suggestionabsurd would give it far too
much credence.It is no more crediblewhen the settlor is still alive. What's
more, this argument is basedon the wording of declarationswhich were
drafted by
their

signatures.

choice
was

respondents

themselves

(CT2

of words

and

285-288.)

against

presented

to Gaggero

Respondents

Gaggero

and Praske

successfully

to persuade

the court

used
that

for

their

own

his estate

plan

a sham.
Respondents

trust

established

429:14;
mean

RT

breathlessly
under

6:2-9),

the settlor

the

told the court

laws

insinuating

is trying

that

to defraud

to plan

for one's

f'mancial

future

(David

C. Lee,

"Offshore

Asset

Judicial

Tolerance

Since

respondents

added

- again

protection

in Estate
could

cite

with no support

laws"

(CT1

of Anguilla

32:2),

the

that Arenzano
(CT 1 32:1-2;

creation

creditors.

Planning",
no facts
- that

necessarily

Trusts:

27

that

should

must
trusts

the Limits

451,454

is "known
trusts

trust

problematic[.]"

Testing

or law to justify

as if offshore

424:9-10,

use of offshore

15 Bankr.Dev.J.

Anguilla

CT3

of an offshore

But "[t]he

is not by itself
Protection

was an offshore

of

(1999).)

conclusion,

they

for its strong

asset

instead

be based

where such protections are weak. (See34A Am.Jur.2d FederalTaxation

105,208["A trust settlor should seekan offshore
alia, "a favorable
confidential
trust

trust

and

had

instruments

filed

with

Probate
outside

never

(unless
also

would

33:1-2;

Giganin

is a QPRT.

settlor's

residence

trusts

based

having

have

CT3
(CT1

are

no

trustor

required

31:25.)

very

Campbell,

Edn: Anguilla.

avoidance

and

continued

out. (CT1

2011);

Channel

Britain,
Taxation

the Isle of Man,

105,207.)
16 At the May

instruments
11.)

But

Islands,

contained

(RT 6:6-14.)

on the

untroubled

even

if there

did not even

were

such

freely
This

appears

provisions
why

Caicos.

(34A

was

would

would
28

they

to
at

their

not matter,

be improper.

Great

Am.Jur.2d

had

evidence

most

the Cayman
Fedcral

that the trust

provisions".

to be a claim

there
they

they

that

agree

15, 2013)

Gibraltar,

also told the court

confidentiality

admitted

by whether

try to explain

and

Cyprus,

for

of Low-

the jurisdictions
are Belize,

Islands,

respondents

"independent

respondents

Cook

Turks

29 hearing,

instruments.
spot,

and

the

known

havens'

(June

(34

offshore

Taxation

" 'Tax

that

is to own the

is actually

News

trusts

the

admitted

involve

which

Among

Islands,

31:8-

cases

BBC

sites for offshore

that a

to live there.

commonly

favorable

in his

28:6-8,

of a QPRT

www.bbc.co.uk/news/uk-politics-22915954.)
deemed

also

which

(Juris

to live

suggesting

International

evasion",

16

he continues

Dependency

(See

Guide."

is administered

respondents

California

confidential.

otherwise)".])

purpose

to be

Practice

it to Giganin,

But

though

supposed

property

Gaggero

of time while

- a British

-2nd

trust

inter
were

6), even

presumptively

him to move

The

(RT
aren't

provided

that

428:21-22.)

tax laws.

on tax

vivos

published

in Anguilla

Tax Transactions

["inter

with,

instruments

California

he transferred

for a period

favorable

clampdown

after

are

Cohen,

complained

court

documents

and

center"

the trust

any

they

the decedent

transfer

15 There

Ross
2:116

even

11, 31:24-26,

with

though

even

residence

legitimate

filed

and

Respondents
personal

complained

estate-planning

2013)

probate

been

700-735;

(Rutter

Is They

and other

a court

(Prob.Code

law"].)

financial

never

(RT

6:10-

seen

those

counsel

made

to support

it.

since

up
But

respondents

Am.Jur.2d Federal Taxation 40203.) Respondentsfailed to offer even a

scintilla of evidencethat this arrangementwas improper.
One piece of evidenceon which respondentsrelied heavily was the
testimony of JamesWalters, Gaggero'sformer accountant,that the estate's
gains and losses"flowed through" Gaggero'stax returns. (SeeCT1 36:2122 (citing CT2 241:4-6) and CT3 424:11-14.) But that is routinely true of
grantor trusts (26 U.S.C. 671-677),which are a common estate-planning
device andquite unremarkable.(Estateof
783-784.)

Respondents

testimony

supported

["Gaggero

...

It's

ever
only

by explaining

as trustee

14, 33:2-6,
tried

frequent

39:7-8;

to explain

fill this role?

neither

law

often

administer

the settlor
ability

nor

to

reclaim

this

suggests

What's

to justify

the entities

his

improper

former

to

cite no evidence

if he did it would
to pursue

is that Praske

the LLC's

not

his estate

their

insinuation.

them.
assets

by

29

else

the

offered
attorneys

not suggest

had forever
trusts

even

shouldn't

They

Estate-planning

to

32:10-

never

Why

should?

all, Gaggero
making

(CT1

They

but that fact does

After

continues

and LP's.

or suspicious.

not do it, who

they establish,

still owns

29:10-11

work.

of respondents

was

28:14

impervious

they

threatening

and to manage

fact

(CT1

that it is fraudulent.

more,

someone

wouldn't

If he should

logic

somehow

were

CT3 428:23-25,429:26-28,432:13-17.)

why

Praske

assets

somehow

plan

Gaggero

impenetrable"],

But even

complaint

of the trusts

plan

improper.

claims

estate

777,

accountant's

anything

of the sort.

to answer

their plan

his

his

not reasonable.

natural

of

that

the

by describing

estate

strength

said anything

why

Another
serve

asserted

is simply

Gaggero

his

67 Cal.App.3d
that

or suggested

strength

touted

(1977)
at all

argument

the

as if the plan's

inference

matter.

boldly

evidence

finding

their

about

unabashedly

execution"]),
That

made

has

["Gaggero

that

bolstered

supposedly

no

an alter-ego

Respondents
had

offered

Hearst

that

lost the

irrevocable.

(DiMaria
Laycock

v. Bank

v. Hammer
The

not

32:14-24,

37:5-12.)

liability

(CT1

Even

ad nauseam

28:2-8,

5, 33:13-15,
432:5-7,

36:2-6,

40:4-6,

lack

manage
orders

the

to Praske
37:5-12;

misrepresentations
Praske
manage

the

Gaggero's
But

interests,

218.)

While

hints

Entities

31:12-18,

CT1

alter-ego

v. Farmers

since

respondents
or their

assets.

31:18-20,

32:4-

430:20-21,432:3-5,

showing
than

Praske

honest

just

claims

built

review

engaged

of

gives

They

who

advice.
all

the

Gaggero

it is Gaggero

were

on

is staggering.

expert,
that

supposedly
These

an

was

evidence

to claim

both

testified

to Praske's
he deems

his

own,
that was

respondents
should

Praske

to

gives

(CT1

32:14-

on

active

based

be used,

much
what

behalf

testified

were

interests

and

to
that

32:14-24),

for his own

3O

is authorized

that

Praske

benefit

approves

of the Entities.

further
he

to

the

Entities'

would

reject

any

of the Entities.

(CT2

205-

assesses

how

of the fact that

new properties

(CT1

Gaggero

to be in the interests
designed

not in the best

make

on their
actions

are

and

that

approval,

them

recommendations

that these

and

it was

e.g.,

since

(Triplett

CT3 428:15-17

rather

in order

Gaggero

when

he has negotiated

31:11-12,

supporting

432:18-20.)

decisions

the properties

1421)

that

(See,

matter,

control

respondents'

assets

subject

recommendation

and

who is not a real estate

assets

not

it wouldn't

claim

of the record.
and

Gaggero's

258-259;

432:11-12)

and that

CT3

estate.

did not own the

of probative

Entities'

the

th at

falsehoods

the fact that Praske,

controlled

ownership

fundamentally,

Their

their

42:15-16;

432:9-10,

and

was

31:8-11,

254,

25, 30-31.)

true

Gaggero

Cal.App.2d

argument

Cal.App.4

that

misrepresentations

24,

24

29:21-22,

More

cited

if this was

29:1-4,

432:7-9,

evidence.

actually

of both

supra,

237

141 Cal.App.4th

who

proof

Exchange,

(1965)

of respondents'

Praske,

requires

conceded

(2006)

linchpin

Gaggero,

Ins.

of California

Gaggero

to purchase,
none
rather

etc., and that

of their evidence
than

the estate's

even
- or

that a different personwith the samebackgroundwould everhavemadeeven

one of thosedecisionsdifferently.
If respondentshaveproved anything, it is that Gaggerowas right in
1997to worry aboutfuture creditorstrying to extract money from his estate
and to take extensive precautions.If a settlor must either leave his estate
exposed or risk having his precautionsdeemed proof that the estate is
fraudulent, then thereis no way to makeestateplanssecure.
CONCLUSION
Whethera trust or businessentity is an individual's alter ego is about
more than appearances,andwhether a motion is time-barredis about more
than how adamantlya party pursuesit. Suchrulings must insteadreflect the
reality of how the Entities actually operateandhow their financesrelate to
the alleged alter egos,as well as on how long the moving party delays and
on whether the law evenallows the relief they seek.
If a creditor can add new judgment debtorsjust by filing cleverlywritten paperswhich createthe illusion of fraud, then no estateplan - and
indeed,no corporationor other businessentity - will everbe safe,no matter
how meticulouslyit follows the rules.
All respondentsdid to persuade the court, without substantial
evidence, to improperly engagein outside reversepiercing was to present
innocuous, tmremarkable facts about the Entities and "spin" them
aggressivelyto createthe appearanceGaggerowas somehowusingthem to
pull off a massivefraud to evadea debt he incurred eleven years after
estate
court

plan

was

put in place.

that Gaggero's

reverse-piercing
bringing

their

entire
and

motion.

even

In so doing,

estate

plan

is a sham,

to completely

In California,

they

only

persuaded

but also to perform

disregard

a judgment

31

not

their
against

four-year

his

the trial
improper
delay

an individual

in
may

not be amended
legal

control

to include

over

the

entities,

entities

especially

and

where

the entities

the individual

did not

participate

has no
in the

litigation.
For all these reasons,
this court
jUdgment

Dated:

to reverse
which

named

Au_F8k!2013

the

appellant
trial

Stephen

court's

the Entities

alter-ego

as additional

WESTLAKE

By:

/..4_4

M. Gaggero

respectfully

l'mdings

and

judgment

LAW

GROUP

(-J

w,

32

the amended

debtors.

',

David Blake Chatfield

Attorneys
for A_pcllant
STEPHEN
5,4. G_ad_GERO

asks

WORD
Pursuant
word

count

Microsoft

to Cal.

Rules

for Appellant's
Word

which

COUNT

CERTIFICATION

of Court,
Opening

Rule
Brief

was the computer

8.204(c)(1),
is 9,669

software

I certify

words,

program

as counted

August

8, 2013

WESTLAKE
,,"
/

By:

LAW
/"

GROUP

"j2-.
S

_"

,,g_.-.'L./'--C."
David Blake
Attorneys
STEPHEN

33

.17
'

j_"

_ ... ,'.
Chatfield

for Ap_'_llant
M. GAGGERO

by

used to produce

this brief.

Dated:

that thc

....

..)

PROOF OF SERVICE
I
years,

am a resident
of the State of California,
and not a part), to the within action. My

Townsgate

Road,

Suite 330, Westlake

Village,

California

On August 8, 2013, I served the foregoing

APPELLANT'S
OPENING
BRIEF
X-....;__

BY MAIL

I placed

the above

postage thereon fully prepaid,

Village_ California,
addressedas

Randall
Miller

Flower

Street,

with

mail at Westlake

Edward A. Hoffman
11755 Wilshirc Blvd., Suite
Los Angeles, CA 90(125

Suite 2150

1250

Clerk of the Supreme Court

Supreme Court of California
350 McAllister
Street

County

CA 9001

San Francisco,
(Four Copies)

1 declare under penalty

of perjury under
California
that the above is true and correct.
Executed

envelope

as:

CA 90071

Clerk 'of the. Superior Court

Superior Court of Los Angeles
111 North Hill Street
Los Angeles,

described

in a sealed

in the United States

set forth below.

A. Miller

515 South

91361.

document(s)

document(s)

LLP

.Los Angeles,

over the age of eighteen

business address
is 2625

on August

8, 2013, at Los Angeles,

David

the

CA 94102

taws

of the State

California.

Blake

c.1"2 '"
Chatfield
!

34

'!

of