Thunderbird Resorts Inc. v. Zimmer
3:15-cv-01304
| S.D. Cal. | Mar 8, 2019Background
- Thunderbird Resorts, Inc. (Plaintiff) sued multiple defendants including Taloma Zulu, S.A. (Taloma) alleging RICO, breach of fiduciary duty (aiding and abetting), conversion, constructive trust, accounting, and breach of contract arising from diversion of GTCR casino profits.
- Plaintiff alleged Taloma received and redirected GTCR funds (including a $108,000 payment tied to a Poway property purchase) and transferred funds to Zimmer and others between 2010–2014.
- Plaintiff obtained service on Taloma via Letters Rogatory from Panama; the Clerk entered default against Taloma after it failed to appear.
- Plaintiff moved for default judgment on the aiding-and-abetting breach of fiduciary duty claim and sought damages, prejudgment interest, and costs; the Court granted default and requested supplemental briefing on damages.
- The Court found evidentiary limits on certain 2008 and 2014 payments but concluded Taloma transferred $695,200 from GTCR; Plaintiff’s share (50%) equated to actual damages of $347,600.
- The Court awarded damages, prejudgment interest (7% from service date), and costs, entering a final default judgment against Taloma for $407,643.24.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether default judgment may be entered against Taloma | Taloma defaulted; judgment appropriate on aiding-and-abetting breach of fiduciary duty | Taloma did not appear to contest | Default judgment granted against Taloma (claim limited to aiding/abetting breach) |
| Proper measure of damages | Seek $825,125.35 (initial damages + supplemental transfers) | No appearance; Court reviews evidence for certainty and attribution | Court awarded Plaintiff 50% of embezzled funds: $347,600 (reflecting $695,200 total diverted) |
| Prejudgment interest entitlement and accrual date | 7% under Cal. Civ. Code §3287 from Complaint filing | No appearance | 7% prejudgment interest on $347,600 from service date (Sept 26, 2016); total interest accrued $59,596.24 as of judgment date |
| Recoverable costs | Recover filing fees and Letters Rogatory fees | No appearance | Costs awarded: $447.00 |
Key Cases Cited
- Evanston Ins. Co. v. OEA, Inc., 566 F.3d 915 (9th Cir. 2009) (prejudgment interest under Cal. Civ. Code §3287 requires damages certain or calculable)
- Highlands Ins. Co. v. Continental Cas. Co., 64 F.3d 514 (9th Cir. 1995) (discussing certainty requirement for prejudgment interest)
- Hartford Accident & Indem. Co. v. Sequoia Ins. Co., 211 Cal.App.3d 1285 (Cal. Ct. App. 1989) (vesting for prejudgment interest when damages are capable of being made certain)
- Olson v. Cory, 35 Cal.3d 390 (Cal. 1983) (damages certainty requirement for prejudgment interest)
- Thompson v. Asimos, 6 Cal. App. 5th 970 (Ct. App. 2016) (limitations on applying prejudgment interest formula to uncertain amounts)
- Levy–Zentner Co. v. Southern Pac. Transp. Co., 74 Cal.App.3d 762 (Cal. Ct. App. 1977) (prejudgment interest runs from date damages are certain or calculable)