Avraham Hassid v. 2079 15th Street, LLC, et al.

(Stanley Mosk Courthouse: Dept. 517) September 1, 2026 DEPARTMENT 517 LAW AND MOTION RULINGS

grant in full the motion for summary adjudication of Zuma Bay Villas Association on its cross-claims against ADCO South Roofing and Waterproofing, Inc. The Court will set forth the basis for this tentative ruling at the hearing on the motion this morning. Case Number: 25STCV11891 Hearing Date: September 1, 2026 Dept: 517

Plaintiff Avraham Hassid ("Hassid") sued his business partners in Defendant 2079 15th Street, LLC ("the LLC"). The partners are: Defendants Goel Sohmekh ("Goel"), David Sohmekh ("David"), and Rahel Sohmekh ("Rahel") (collectively, "the Sohmekhs"). Hassid alleges that Goel requested a loan of $4,000,000.00 from him to demonstrate "proof of funds" to a third party for a building he wanted to purchase. (Complaint, P. 12.) Hassid alleges that the Sohmekhs never intended to return the money. (Id., P. 15.) In his Complaint, Hassid asserts claims against the Sohmekhs and the LLC for (1) fraud; (2) negligent misrepresentation; (3) conversion; (4) unjust enrichment; and (5) breach of oral contract.

David cross-claimed against Hassid, the LLC, plus two other entities: Western Imperial 2000, LLC; and Malka Investments, LLC (collectively, "Cross-Defendants"). In essence, David alleges in the Cross-Complaint that the Cross-Defendants defrauded him and the LLC. In his operative First Amended Cross-Complaint ("the FACC"), David asserts cross-clams both derivatively on behalf of the LLC and individually on his own behalf. The cross-claims are as follows: (1) breach of fiduciary duty (derivative); (2) breach of contract and the implied covenant of good faith and fair dealing (derivative); (3) financial abuse of an elder (direct); (4) accounting (derivative and direct); (5) monies had and received (derivative); (6) monies had and received and breach of promise to repay loaned funds (derivative); and (7) monies had and received and breach of promise to repay loaned funds (derivative).

Pending before the Court is Hassid's demurrer to David's claim for financial elder abuse in the FACC. The Court is sustaining the demurrer without leave to amend. David asserts a direct cross-claim for financial elder abuse under the Elder Abuse and Dependent Adult Civil Protection Act ("the Act"). The Act states that financial abuse of an elder occurs when a person or entity "[t]akes, secretes, appropriates, obtains, or retains real or personal property of an elder or dependent adult for a wrongful use or with intent to defraud, or both" or "[t]akes, secretes, appropriates, obtains, or retains, or assists in taking, secreting, appropriating, obtaining, or retaining, real or personal property of an elder or dependent adult by undue influence, as defined in Section 15610.70." (Welf. & Ins.

Code, Sec. 15610.30, subd. (a).) The FACC alleges that David is 79 years old, which means that he meets the definition of an "elder" in the Act. (Cross-Complaint, P. 1.)

The Court previously sustained the Cross-Defendants' demurrer to David's direct elder abuse claim in his initial Complaint. In that pleading, David alleged that Hassid operated the LLC to David's detriment and that Hassid refused to distribute to David funds belonging to him. (Complaint, P.P. 81, 83.) The Cross-Defendants argued in the demurrer to the initial Complaint that David's direct financial elder abuse claim is foreclosed as a matter of law under Hilliard v. Harbour (2017) 12 Cal.App.5th 1006. In that case, the Court of Appeal affirmed an order sustaining without leave to amend a demurrer to claims of financial elder abuse brought under the Act by a member of limited liability companies against the companies' manager and lender. (Id. at pp. 1108, 1110.)

The plaintiff-member argued that financial elder abuse is necessarily a personal claim that a limited liability company member may directly bring against other actors in the company. The Court of Appeal rejected the argument. Applying standards governing the interplay between the Act and alleged corporate wrongdoing established in prior cases, it held that the plaintiff's financial elder abuse claim "d[id] not originate in circumstances independent of his status as a shareholder in the [c]ompanies and his claim therefore cannot be deemed personal. . . But for his shareholder status, [plaintiff] would not have been injured by the [defendants'] conduct. (Id. at p. 1015.) Accordingly, the Court of Appeal concluded that the plaintiff lacked standing to bring an individual action for financial elder abuse. (Id. at p. 1016.)

This Court held that the same was true of the allegations supporting David's financial elder abuse claim in the initial Complaint. All of the allegations, the Court stated, arose from David's alleged membership in the LLC and thus failed to overcome Hilliard. Based on that determination, the Court sustained the demurrer to the financial elder abuse claim in the initial Complaint. The Court nevertheless gave David leave to amend to afford him an opportunity to plead around the Hilliard bar.

Hassid argues in his demurrer the FACC that the allegations supporting the elder abuse clam in the FACC fail to accomplish that. The Court agrees. In the FACC, David alleges that Hassid made "disproportionate" distributions of funds from the LLC without David's knowledge or consent, by causing the LLC to transfer monies to Hassid and companies controlled by him -- transfers that Hassid falsely characterized as loans and repayment of monies advanced, while at the same time failing to cause the LLC to make distributions to David in proportion to David's capital account balances. (FACC P. 82.)

David further alleges that Hassid's conduct in causing the LLC to make the disproportionately larger distributions for his benefit, without at the same time causing the LLC to make proportionate distributions to David based on David's capital account balances, breached the fiduciary duty that Hassid owed to David as a 50% member of LLC and thus constituted a wrongful use of funds to which David, an elder, was entitled. (Id. P. 84.)

Hassid correctly points out that the only change that the FACC makes to the initial Complaint with respect to the financial elder abuse claim is that the distributions Hassid made to David allegedly were disproportionate to David's capital account balances. This differs from the allegations in the initial Complaint, which implied that Hassid made no distributions at all to David. The FACC's recasting of the distributions as "disproportionate," as opposed to non-existent, does not alter the basis for David's claimed entitlement to distributions.

That right still rests on David's asserted membership in the LLC, his capital account, the distribution mechanism in the LLCs Operating Agreement, and the manager-to-member fiduciary duty. In short, but for David's membership in the LLC, he would have no entitlement to the proportionate distributions (or any distributions for that matter) that he alleges in the FACC that he did not receive.

The elder abuse claim in the FACC thus suffers from the same pleading defect the Court identified in its ruling on the demurrer to that claim in the initial Complaint. As was the case with the earlier pleading, the allegations in the FACC fail to overcome the hurdle imposed by Hilliard. David's reliance on Jara v. Suprema Meats, Inc. (2004) 121 Cal.App.4th 1238, and Reliant Life Shares, LLC v. Cooper (2023) 90 Cal.App.5th 14, is misplaced. The Court of Appeal's decisions in those cases addressed the distinction between derivative claims and individually recoverable claims for unequal payments, and held that the plaintiffs in both cases had stated claims for breach of fiduciary duty even though their right to recover arose solely from their status as s shareholder of a company (Jara) and as a member of a limited liability company (Reliant Life).

But neither Jara nor Reliant Life involved claims of financial elder abuse. Thus, neither case addresses the interplay between the Act and corporate wrongdoing that marks the core of Hilliard, which did involve such claims.

The Court is sustaining Hassid's demurrer to David's financial elder abuse claim in the FACC without leave to amend. That is because at this point, it does not appear to the Court that it is reasonably possible that David can cure the pleading defects that the Court has now identified two times in demurrer rulings. (Goodman v. Kennedy (1976) 18 Cal.3d 335, 349.)

Hassid is directed to file an answer to the remaining claims in the FACC. (Cross-Defendants Western Imperial 2000, LLC and Malka Investments, LLC already have answered the FACC.) The Court is continuing the case management conference that is on calendar today to November 6, 2026 at 8:30 a.m. | Home -->)" -->