PATTON vs ARVO SOLAR FRANCHISING, LLC

24CV017897: PATTON vs ARVO SOLAR FRANCHISING, LLC 08/25/2025 Hearing on Writ of Attachment as to Jon Phillip Horton in Department 53

Tentative Ruling

NOTICE: PLEASE TAKE NOTICE that pursuant to “Public Notice – Civil Division – Wednesday Law and Motion Calendar” any oral arguments regarding this tentative ruling will be heard in Department 25, located at 720 9th Street, Sacramento, CA, the Hon. Julie G. Yap presiding. Should argument be requested by either party, the requesting party must call the Law and Motion Oral Argument Request Line at (916) 874-2615, by 4:00 p.m. the Court day before the hearing, request the hearing, and notify the opposing party of the location and time of hearing pursuant to Local Rule 1.06.

At the time of requesting oral argument, the requesting party shall leave a voice mail message: a) identifying themselves as the party requesting oral argument; b) indicating the specific matter/motion for which they are requesting oral argument; and c) confirming that it has notified the opposing party of its intention to appear and that opposing party may appear via Zoom using the Zoom link and Meeting ID indicated below. If no request for oral argument is made, the tentative ruling becomes the final order of the Court.

The Court encourages parties to appear remotely for the hearing on the tentative ruling through the Court’s Zoom Application. But, any party wishing to appear in person may do so, provided that party notifies the Court by 4:00 the Court day before the hearing. The parties may join the Zoom session for hearing on the tentative ruling by audio and/or video through the following link: https://saccourt-ca-gov.zoomgov.com/my/sscdept25 SIP Address: 16113421868@sip.zoomgov.com (833) 568-8864 ID: 16113421868 Parties requesting services of a court reporter will need to arrange for private court reporter services at their own expense, pursuant to Government code §68086 and California Rules of Court, Rule 2.956.

Requirements for requesting a court reporter are listed in the Policy for Official Reporter Pro Tempore available on the Sacramento Superior Court website at https://www.saccourt.ca.gov/court-reporters/docs/crtrp-6a.pdf. Parties may contact Court- Approved Official Reporters Pro Tempore by utilizing the list of Court Approved Official Reporters Pro Tempore available at https://www.saccourt.ca.gov/court-reporters/docs/crtrp- 13.Pdf A Stipulation and Appointment of Official Reporter Pro Tempore (CV/E-206) is required to be signed by each party, the private court reporter, and the Judge prior to the hearing, if not using a reporter from the Court’s Approved Official Reporter Pro Tempore list.

Once the form is signed it must be filed with the clerk. If a litigant has been granted a fee waiver and requests a court reporter, the party must submit a Request for Court Reporter by a Party with a Fee Waiver (CV/E-211) and it must be filed with the clerk at least 10 days prior to the hearing

24CV017897: PATTON vs ARVO SOLAR FRANCHISING, LLC 08/25/2025 Hearing on Writ of Attachment as to Jon Phillip Horton in Department 53

or at the time the proceeding is scheduled if less than 10 days away. Once approved, the clerk will be forward the form to the Court Reporter’s Office and an official reporter will be provided

TENTATIVE RULING

Appearance required.

Plaintiff Bryan Patton’s (“Plaintiff”) Application for Right to Attach Order and Order for Issuance of Writ of Attachment against Defendant Jon Phillip Horton (“Defendant”) is ruled upon as follows.

Factual Background

Plaintiff’s complaint asserts causes of action for unfair competition, false advertising, and rescission. The Complaint alleges that Defendant induced Plaintiff into signing a written franchise agreement with them to operate one Arvo Solar franchise in Sacrament. (Compl., ¶ 10.) As part of the agreement, Plaintiff agreed to pay Defendant the sum of $2,100,000, as well as a continuing monthly royalty in the amount of 4% net gross generated by the franchise. (Compl., ¶¶ 12, 13.) Plaintiff alleges that despite the representations of Defendant, “defendants sold to plaintiff an unregistered, unlicensed franchise that was not subject to any state or federal exemptions and, moreover, was accompanied by materially false and misleading representations, including those concerning the nature and extent of the risks associated with investing in an Arvo Solar franchise and the resources/support plaintiff would have access to.” (Compl., ¶ 14.)

Plaintiff seeks a writ of attachment against Defendant in the amount of $602,627.50. Defendant opposes on the ground that the amount sought to be attached is inaccurate, and Plaintiff cannot establish probable validity for his claims.

Legal Standard

The remedy of prejudgment attachment is available only in limited circumstances. First, attachment is properly granted only in an action presenting a claim for money based upon a contract, express or implied, where the total amount of the claim is a fixed or readily ascertainable amount of at least $500 (exclusive of costs, interest and fees), which arises out of the defendant's operation of a trade, business, or profession, and which is not otherwise secured by any interest in real property. (Code Civ. Proc. §§ 483.010, 484.010.)

SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO

24CV017897: PATTON vs ARVO SOLAR FRANCHISING, LLC 08/25/2025 Hearing on Writ of Attachment as to Jon Phillip Horton in Department 53

Second, the trial court must find that (1) the applicant has established the “probable validity” of the claim upon which the attachment is based; (2) the attachment is not sought for a purpose other than the recovery of the underlying claim; and (3) the amount to be secured by the attachment is greater than zero. (Code Civ. Proc. § 484.090(a).) The court is to base its determination on the pleadings and other papers in the record. (Code Civ. Proc. § 484.090(d).) The applicant has the burden of proving with admissible evidence that it is more likely than not s/he will obtain a judgment against the defendant on the claim. (Code Civ.

Proc. §§ 484.030, 481.190, 484.090(a)(2).) Thus, a trial court not only has the power to but ultimately must weigh the evidence offered in connection with the application in order to determine the 'probable validity' of the applicant's claims. (See, e.g., Hobbs v. Weiss (1999) 73 Cal.App.4th 76, 80.) Still, the court is not required to accept as true even undisputed declarations where contrary inferences may be drawn from other evidence. (See, e.g., Bank of America v. Salinas Nissan, Inc. (1989) 207 Cal.App.3d 260, 270.)

Finally, there are strict statutory requirements that must be met to establish a prima facie claim to relief and strict construction of the statutory scheme prevents relief unless specifically provided in statute. (Pacific Decision Sciences Corp. v Superior Court (2004) 121 Cal.App.4th 1100, 1106.) Any opposition to an application for writ of attachment is due five court days before the hearing. (Code Civ. Proc. § 484.060(a).)

Discussion

Plaintiff has presented his declaration and the declaration of Steven Dekok in support of his application for writ of attachment. Plaintiff attests that he was induced into signing a written franchise agreement to secure franchise rights to operate an Arvo Solar location in Sacramento. (Patton Decl., ¶¶ 2, 3.) Plaintiff sets forth the terms of the agreement as follows:

[Plaintiff] (1) was purportedly granted the utilization of franchise proprietary information, i.e. goodwill, trade names, customer lists, sales methods, product knowledge, and other intellectual property; (2) was purportedly granted the right to develop and operate an Arvo Solar franchise, under the Marks and pursuant to the Licensed Methods; (3) was required to pay an initial franchise fee of $600,000.00 upon execution of the agreement; and (4) was required to pay $1,500,000 approximate balance of a non-negotiable promissory note payable to Seller in equal monthly installments, including 6% per annum interest computed from Closing, so as to fully amortize over 120 months ($16,653 per month), with payments to begin one month from Closing.

(Patton Decl., ¶ 4.)

SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO

24CV017897: PATTON vs ARVO SOLAR FRANCHISING, LLC 08/25/2025 Hearing on Writ of Attachment as to Jon Phillip Horton in Department 53

Approximately six months later in September of 2024, Plaintiff discovered that Defendants had “falsely and fraudulently represented that they were authorized to sell franchise opportunities in California and had sold to [Plaintiff] an unregistered, unlawful franchise that was not subject to any state or federal exemptions.” (Patton Decl., ¶ 6.)

Plaintiff sought to rescind the agreement and obtain a refund of the $602,627.50 paid to Defendants. (Patton Decl., ¶ 7.) However, Defendants refused. (Ibid.) Plaintiff has recently learned that Defendant Horton intends to transfer his assets to insulate them from this litigation. (Patton Decl., ¶¶ 8, 9, 10; Dekok Decl., ¶ 5.)

In opposition, Defendant argues that Plaintiff “drove his franchise into the ground,” and now seeks to recover funds which he is not entitled to. (Opp., p. 3:15-20; Horton Decl., ¶¶ 7-12.) Defendant makes no argument in opposition to Plaintiff’s claims that Defendant sold him an unlicensed franchise, or that Defendant now seeks to insulate his assets by transferring them to family members. Defendant cites no authority to support his assertion that he is entitled to a reduction in business valuation based in part on a cross-complaint for negligence, which has not yet been filed.

Nor does Defendant present any evidence to support his claim that $186,000 of the funds sought to be attached are attributable to broker fees. Further, as noted in the reply, the California Franchise Investment Law holds every person who materially aids in the act or transaction constituting the violation jointly and severally liable and extends liability to franchise brokers. (California Corporations Code sections 31302, 31300(b).)

The Court finds that Plaintiff has made a showing sufficient to satisfy the requirements of Code of Civil Procedure section 484.090(a) by establishing the probable validity of the contract claim upon which the remedy of attachment is based, along with damages in an amount certain. (Code Civ. Proc. §§ 484.090(a)(2), 485.220(a)(2); Hill v. Superior Court in and for Alameda County (1940) 16 Cal.2d 527, 530; see Dekok Decl., ¶¶ 3-6, Ex. A; Patton Decl., ¶¶ 2-11, Exs. A-D; Paterson Decl., ¶¶ 3-9; Exs. A-c.) Therefore, based on this showing and the lack of opposition, the Court will GRANT to the present application for right to attach order and for writ of attachment in the amount of $602,627.50.

Pursuant to Code of Civil Procedure section 489.220(a), Plaintiff to post a $10,000 undertaking no later than September 4, 2025.

The Court will sign the writ of attachments filed with the moving papers upon proof of Plaintiff's posting of the $10,000 bond. Pursuant to California Rules of Court, Rule 3.1312 Plaintiff to prepare a proposed right to attach order which, if found appropriate, will be signed by the Court upon proof of Plaintiff's posting of the $10,000 bond.