Bunge Nsmail 4

1 SUPERIOR COURT OF THE STATE OF CALIFORNIA
2 FOR THE COUNTY OF LOS ANGELES
3 DEPARTMENT WE B HON. NORMAN P. TARLE, JUDGE
4 JOSE BUNGE; VICTORIA BUNGE, )
)
5 )
PLAINTIFF(S), )
6 )
V. ) NO. SC100361
7 )
511 OFW, LP., A CALIFORNIA )
8 LIMITED PARTNERSHIP; )
GINGERBREAD COURT, L.P., A )
9 CALIFORNIA LIMITED PARTNERSHIP;)
BOARDWALK SUNSET, LLC, A )
10 CALIFORNIA LIMITED LIABILITY )
COMPANY; STEVE GAGGERO; AND )
11 DOES 1-50; INCLUSIVE, )
)
12 DEFENDANT(S). )
_______________________________)
13 )
AND RELATED CROSS-ACTION )
14 _______________________________)
15
REPORTER'S TRANSCRIPT OF PROCEEDINGS
16 FEBRUARY 7, 2012
17
18 APPEARANCES:
FOR PLAINTIFFS: LAW OFFICES OF
19 PAUL D. BEECHEN, INC.
BY: PAUL D. BEECHEN, ESQ.
20 1900 AVENUE OF THE STARS
SUITE 2300
21 LOS ANGELES, CALIFORNIA 90067
22
FOR DEFENDANTS: BLECHER & COLLINS
23 BY: MAXWELL M. BLECHER, ESQ.
AND JOHN E. ANDREWS, ESQ.
24 515 SOUTH FIGUEROA STREET
SUITE 1750
25 LOS ANGELES, CALIFORNIA 90071
26
27
KAREN B. YODER, CSR NO. 8123
28 OFFICIAL REPORTER

1 MASTER INDEX
2 FEBRUARY 7, 2012
3 CHRONOLOGICAL AND ALPHABETICAL INDEX OF WITNESSES
4
5 CORIN KAHN, CALLED BY THE DEFENDANTS (776) PAGE
DIRECT EXAMINATION BY MR. BLECHER 2
6 CROSS EXAMINATION BY MR. BEECHEN 21
7 JOSEPH PRASKE, CALLED BY THE PLAINTIFF (REBUTTAL)
DIRECT EXAMINATION BY MR. BEECHEN 25
8 CROSS EXAMINATION BY MR. BLECHER 36
REDIRECT EXAMINATION BY MR. BEECHEN 38
9
10 EXHIBITS
11
12 NONE
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28

1
1 SANTA MONICA, CALIFORNIA; TUESDAY, FEBRUARY 7, 2012
2 10:04 A.M.
3 * * * *
4
5 THE COURT: WE'RE ON THE RECORD, BUNGE VERSUS 511
6 O.F.W., AND I'LL ASK THE ATTORNEYS ONCE AGAIN TO STATE
7 THEIR APPEARANCE, PLEASE.
8 MR. BEECHEN: PAUL BEECHEN ON BEHALF OF
9 PLAINTIFFS.
10 MR. BLECHER: MAXWELL BLECHER AND JOHN ANDREWS
11 FOR THE DEFENDANT AND CROSS-COMPLAINANT.
12 THE COURT: ALL RIGHT. SO THE LAST TIME WE WERE
13 TOGETHER, THE COURT WAS INFORMED THERE WAS ONE MORE
14 WITNESS THAT WAS GOING TO BE CALLED. IS THAT HOW WE'RE
15 PROCEEDING TODAY?
16 MR. BLECHER: AND HE'S HERE IN COURT, AND WE'LL
17 CALL MR. CORIN KAHN.
18 THE COURT: WAS THERE ANYTHING ELSE WE HAVE TO
19 TAKE UP BEFORE THAT?
20 MR. BEECHEN: NOT BEFORE THAT, YOUR HONOR. THERE
21 IS SOME MATTERS TO BE ADDRESSED, AND THERE WILL BE ONE
22 MORE WITNESS AFTER MR. KAHN, BUT I -- AND THAT WILL BE
23 MR. PRASKE. HE'LL BE, I THINK, QUITE SHORT, PROBABLY
24 ABOUT 15 MINUTES. AND THEN THERE IS A COUPLE OF MATTERS
25 TO ADDRESS, BUT WE CAN DO THAT AFTER THE WITNESSES HAVE
26 FINISHED TESTIFYING.
27 THE COURT: I APPRECIATE THAT. THANK YOU.
28 SIR, WHY DON'T YOU PLEASE COME FORWARD. I'LL ASK

2
1 YOU TO STOP RIGHT THERE, RAISE YOUR RIGHT HAND. THE
2 CLERK WILL SWEAR YOU IN.
3
4 CORIN KAHN,
5 CALLED ON BEHALF OF THE DEFENDANTS, HAVING BEEN DULY
6 SWORN, WAS EXAMINED AND TESTIFIED AS FOLLOWS:
7 THE CLERK: DO YOU SOLEMNLY STATE THAT THE
8 TESTIMONY YOU MAY GIVE IN THE CAUSE NOW PENDING BEFORE
9 THIS COURT SHALL BE THE TRUTH, THE WHOLE TRUTH, AND
10 NOTHING BUT THE TRUTH, SO HELP YOU GOD?
11 THE WITNESS: I DO.
12 THE CLERK: PLEASE BE SEATED.
13 THE COURT: PLEASE MAKE YOURSELF COMFORTABLE.
14 AND I'LL ASK YOU TO ADJUST THE MICROPHONE SO THAT YOU'RE
15 SPEAKING DIRECTLY INTO THE MICROPHONE. AND WHEN YOU'RE
16 READY, IF YOU WOULD PLEASE SAY YOUR FULL NAME AND THEN
17 SPELL YOUR FULL NAME.
18 THE WITNESS: MY NAME IS CORIN KAHN, C-O-R-I-N
19 K-A-H-N.
20 THE COURT: THANK YOU. PLEASE PROCEED.
21
22 DIRECT EXAMINATION
23 BY MR. BLECHER:
24 Q GOOD MORNING, MR. KAHN. ARE YOU HERE
25 PURSUANT TO THE SUBPOENA SERVED ON YOU BY THE
26 DEFENDANTS?
27 A GOOD MORNING, MR. BLECHER. I AM.
28 Q AND YOU'RE AN ATTORNEY?

3
1 A I AM.
2 Q WHO SPECIALIZES IN LAND USE?
3 A CORRECT, YOUR HONOR.
4 THE COURT: HE'S NOT YOUR HONOR.
5 THE WITNESS: SORRY. CORRECT, MR. BLECHER.
6 Q BY MR. BLECHER: AND DURING THE PERIOD
7 FROM ABOUT SEPTEMBER TO ABOUT NOVEMBER 2007, YOU
8 REPRESENTED JOSE AND VICTORIA BUNGE IN CONNECTION WITH
9 THE PROPOSED ACQUISITION OF SOME LOTS IN VENICE.
10 A CORRECT.
11 MR. BLECHER: YOUR HONOR, I WOULD ASK TO EXAMINE
12 MR. KAHN UNDER EVIDENCE CODE 776.
13 THE COURT: ANY OBJECTION?
14 MR. BEECHEN: NO OBJECTION.
15 THE COURT: ALL RIGHT. THANK YOU. PLEASE
16 PROCEED. COURT WILL SO ORDER.
17 Q BY MR. BLECHER: USING YOUR DEPOSITION SO
18 WE CAN RUN THROUGH THIS AS QUICKLY AS POSSIBLE, ONE OF
19 YOUR SPECIALTIES IS DEALING WITH PERMITS ISSUED BY
20 GOVERNMENTAL AGENCIES PERTAINING TO THE USE OF LAND.
21 A THAT'S CORRECT.
22 Q AND THAT'S ESSENTIALLY WHAT YOU WERE HIRED
23 TO DO BY MR. AND MRS. BUNGE IN THIS MATTER.
24 A I'D MAKE A CORRECTION TO THE QUESTION. I
25 WAS HIRED TO DEAL WITH THE PARKING ISSUE, NOT THE
26 APPLICATION OF A PERMIT.
27 Q OKAY. BUT THE PARKING ISSUE RELATED TO A
28 COASTAL COMMISSION PERMIT.

4
1 A THAT'S CORRECT.
2 Q AND THAT WAS RIGHT IN YOUR BAILIWICK.
3 A CORRECT.
4 Q AND YOU REALLY DIDN'T HAVE ANYTHING TO DO
5 WITH NEGOTIATING THE PURCHASE AND SALE AGREEMENT FOR THE
6 PROPERTY ITSELF.
7 A I DIDN'T HAVE ANY INVOLVEMENT IN THE
8 NEGOTIATIONS, BUT I WAS ASKED TO REVIEW THE PURCHASE AND
9 SALE DOCUMENT AND MAKE COMMENTS ON IT. BUT I WAS NOT --
10 I COULDN'T SAY THAT I WAS INVOLVED WITH ANY
11 NEGOTIATIONS.
12 Q AND YOU DID MAKE WHATEVER COMMENTS YOU HAD
13 AND GAVE THEM TO THE BUNGES?
14 A CORRECT.
15 Q AND IN THE COURSE OF THIS THREE-MONTH
16 PERIOD, YOU INTERVIEWED MR. FOLKERT, DID YOU NOT?
17 A I DID. AND I THINK IT WAS MORE -- CLOSER
18 TO A TWO-MONTH PERIOD, MR. BLECHER.
19 Q OKAY. AND YOU ACTUALLY NEVER MET
20 MR. FOLKERT. ALL YOUR DEALINGS WERE BY PHONE AND
21 E-MAIL.
22 A CORRECT.
23 Q AND DURING THIS ENTIRE TIME, YOU NEVER
24 TALKED TO OR MET MR. GAGGERO?
25 A CORRECT.
26 Q NOW, DO YOU RECALL IN YOUR DEPOSITION WE
27 ASKED YOU WHAT IT WAS ABOUT THE PARKING THAT CONCERNED
28 MR. AND MRS. BUNGE? DO YOU REMEMBER THAT?

5
1 A I NEED A MORE SPECIFIC QUESTION. WE DID
2 TALK ABOUT PARKING EXTENSIVELY IN THE DEPOSITION.
3 Q ALL RIGHT. WELL, IS IT CORRECT THAT THE
4 MATTER THAT CONCERNED THE BUNGES AND TO WHICH YOU
5 ADDRESSED YOUR ATTENTION WAS WHETHER THEY WOULD RETAIN
6 THE 601 PARKING RIGHTS IF THEY CHANGED THE USE OF THE
7 511 AND 517 PROPERTY?
8 A THAT'S A CORRECT STATEMENT, AS I
9 UNDERSTAND YOUR QUESTION, YES.
10 Q THAT'S WHAT THEY WERE CONCERNED WITH.
11 THAT'S WHAT THEY ASKED YOU TO LOOK AT.
12 A CORRECT.
13 Q NOW, CAN I ASK YOU TO FIND THE BOOK BEHIND
14 YOU. IT MIGHT BE THE WHITE BOOK. EXHIBIT 32.
15 A SORRY. WHICH 30? WHAT DID YOU SAY?
16 Q THIRTY-TWO, SIR.
17 A I'M LOOKING AT EXHIBIT 32. AGREEMENT FOR
18 PURCHASE AND SALE AND THE JOINT ESCROW INSTRUCTIONS.
19 Q THEN I'M WRONG. IT'S PROBABLY 31. I'M
20 SORRY. MOVE BACK ONE SPACE.
21 A AGREEMENT AND JOINT ESCROW INSTRUCTIONS.
22 Q DOES THAT CONTAIN WHAT WE'VE CALLED HERE
23 THE DEED RESTRICTION?
24 A COULD YOU REPEAT THE QUESTION?
25 Q YES. LET ME TAKE A LOOK HERE.
26 A DID YOU ASK WHETHER IT WAS AN ATTACHMENT
27 TO THAT DOCUMENT? MAYBE I CAN BE HELPFUL. I DID FIND
28 THE DOCUMENT CALLED THE DEED RESTRICTION ATTACHED TO THE

6
1 EXHIBIT TABBED 31, WHICH IS CALLED AGREEMENT AND JOINT
2 ESCROW INSTRUCTIONS.
3 Q CORRECT. AND THIS IS DATED AS OF
4 OCTOBER 30, 2007. SO MY QUESTION TO YOU IS: DID YOU
5 SEE THIS DOCUMENT BEFORE THE BUNGES SIGNED IT?
6 A WELL, I NEED SOME CLARIFICATION. THERE'S
7 A SERIES OF DOCUMENTS HERE. AS I MENTIONED, THERE'S AN
8 AGREEMENT AND JOINT ESCROW INSTRUCTIONS, AND ATTACHED TO
9 IT ARE A DEED RESTRICTION THAT HAS INITIALS ON THE
10 LEFT-HAND SIDE.
11 Q YES. AND THAT'S WHERE I'M FOCUSING YOUR
12 ATTENTION. IS THAT DOCUMENT SOMETHING YOU SAW DURING
13 YOUR WATCH?
14 A AGAIN, BEFORE I ANSWER, THERE'S NO DATE ON
15 THIS DOCUMENT THAT I'M ABOUT TO TESTIFY TO.
16 Q IT'S ATTACHED TO THE ENTIRE AGREEMENT,
17 WHICH IS ENTERED AS OF OCTOBER 30; BUT I AGREE WITH YOU,
18 THERE'S NO DATE SPECIFICALLY ON THIS DOCUMENT.
19 A OKAY.
20 Q SO MY QUESTION TO YOU IS: DURING YOUR
21 WATCH, DID YOU ACTUALLY SEE THAT DOCUMENT?
22 A YES.
23 THE COURT: I'M SORRY. I'M A BIT CONFUSED ON THE
24 DATES THAT YOU'RE TALKING ABOUT. YOU SAID, "ENTERED AS
25 OF OCTOBER 30"? WHAT DO YOU MEAN, "ENTERED AS OF
26 OCTOBER 30"?
27 MR. BLECHER: EXHIBIT 31, YOUR HONOR, SAYS THAT
28 THE AGREEMENT WAS MADE AND ENTERED INTO AS OF

7
1 OCTOBER 30TH, 2007.
2 THE COURT: RIGHT.
3 MR. BLECHER: THAT MAY NOT HAVE BEEN THE ACTUAL
4 DATE.
5 THE COURT: EXCEPT THE ATTACHMENT THAT YOU REFER
6 TO AS BATES NUMBER 527, THE DEED RESTRICTION, HAS THE
7 DATE OF NOVEMBER 16TH, 2007 AT THE TOP, WHICH ANTEDATES
8 THAT AGREEMENT. SO I'M A BIT CONFUSED ON THE QUESTION,
9 THEN.
10 MR. BLECHER: THERE'S ALSO A DEED RESTRICTION
11 WHICH IS BATES 524, WHICH HAS NO DATE.
12 THE COURT: RIGHT. SO THE QUESTION IS: WHAT ARE
13 YOU ASKING THE WITNESS TO TESTIFY ABOUT?
14 MR. BLECHER: I'M ASKING WHETHER DURING THE
15 PERIOD HE WAS EMPLOYED BY MR. AND MRS. BUNGE HE SAW THE
16 DEED RESTRICTION MARKED EXHIBIT B, BATES 524, WHICH IS
17 PART OF EXHIBIT 31.
18 THE COURT: OKAY.
19 THE WITNESS: YES, I DID.
20 Q BY MR. BLECHER: AND, MR. KAHN, DID YOU
21 BELIEVE THAT DEED RESTRICTION SATISFIED THE CONCERN OF
22 THE BUNGES THAT THE CHANGE IN THE USE OF THE 511 AND 517
23 PROPERTIES WOULD NOT AFFECT THEIR PARKING RIGHTS UNDER
24 THE COASTAL PERMIT?
25 A COULD YOU REPEAT THE QUESTION AGAIN,
26 PLEASE?
27 Q I PROBABLY COULDN'T; SO I WOULD ASK IF THE
28 COURT REPORTER COULD READ IT BACK.

8
1 THE COURT: YES. PLEASE, MS. YODER.
2 (RECORD READ.)
3 THE WITNESS: WHILE I WANTED LANGUAGE DIFFERENT
4 THAN THIS, I FELT THIS LANGUAGE WHICH WAS REQUESTED FROM
5 THE SELLER WOULD PROTECT THE BUNGES' RIGHT TO PARK AT
6 601, NOTWITHSTANDING THE CHANGE OF THE USE OF THE
7 PROPERTIES AT 511 AND 517 OCEAN FRONT WALK.
8 Q SO THE ANSWER TO MY QUESTION IS --
9 A I THINK I DID, BUT GO AHEAD.
10 Q AND YOU UNDERSTOOD THAT THE COVENANTS TO
11 PROVIDE THE PARKING BASED ON THE COASTAL PERMIT RAN WITH
12 THE LAND?
13 A CORRECT. YES, THAT'S CORRECT.
14 Q I HAVEN'T HEARD THAT EXPRESSION FOR 50
15 YEARS. AND SO IF THE BUNGES PURCHASED THE PROPERTY WITH
16 THE RESTRICTION OR WHATEVER RIGHTS DERIVED FROM
17 EXHIBIT B, BATES 524, THAT WOULD RUN WITH THE LAND?
18 A CORRECT.
19 THE COURT: IF THE USE WAS CHANGED, WAS IT YOUR
20 UNDERSTANDING THAT PARKING WOULD STILL BE REQUIRED --
21 THE SAME NUMBER OF PARKING SPACES WOULD STILL BE
22 REQUIRED WITH A CHANGE OF USE, NECESSARILY?
23 THE WITNESS: IS YOUR HONOR ASKING ME WHETHER
24 WHEN THE BUNGES APPLIED FOR A CHANGE OF USE, THE COASTAL
25 COMMISSION MIGHT IMPOSE A DIFFERENT PARKING REQUIREMENT?
26 THE COURT: YES.
27 THE WITNESS: IT'S LIKELY THE COASTAL COMMISSION
28 WOULD HAVE IMPOSED A DIFFERENT PARKING REQUIREMENT THAN

9
1 THE NUMBER THAT WAS IMPOSED WITH RESPECT TO THE PRIOR
2 USE.
3 THE COURT: ALL RIGHT. AND SO HOW WOULD THE DEED
4 RESTRICTION, AS WORDED HERE APPLY TO THAT SCENARIO?
5 THE WITNESS: THE DEED RESTRICTION IS VERY
6 SPECIFIC AS TO THE NUMBER OF SPACES THAT WERE BEING
7 DEDICATED OR RESERVED FOR THE BUNGES. SO I DON'T THINK
8 THAT HAD ANYTHING TO DO WITH WHAT THE COASTAL COMMISSION
9 ULTIMATELY REQUIRED AS LONG AS THE BUNGES HAD SUFFICIENT
10 SPACES THAT WERE -- THAT MET THE COASTAL COMMISSION'S
11 REQUIREMENTS, WHICH I THINK THEY WOULD HAVE BEEN ABLE TO
12 MEET BECAUSE HOTELS ARE LESS INTENSIVE USE THAN RETAIL,
13 THAT THEY WOULD HAVE SATISFIED THE COASTAL COMMISSION'S
14 PARKING REQUIREMENTS.
15 THE COURT: THANK YOU.
16 Q BY MR. BLECHER: DID YOU UNDERSTAND THAT
17 THE DOCUMENT LABELED "DEED RESTRICTION" WAS A CONTRACT
18 BETWEEN THE OWNERS OF 601 AND THE BUNGES TO PROVIDE 38
19 SPACES, EVEN IF THE USE CHANGED?
20 A YES. AND IT WAS MORE THAN A CONTRACT, OF
21 COURSE, BECAUSE IT'S A RECORDED DOCUMENT. SO IT DID --
22 IT WAS A CONTRACT AND OTHER THINGS AS WELL, OBVIOUSLY.
23 Q SO IF THE BUNGES BUILT A HOTEL, 601 WOULD
24 HAVE BEEN OBLIGATED TO GIVE THEM AT LEAST 38 SPACES?
25 A THAT'S CORRECT.
26 Q AND THAT'S WHAT THEY WERE CONCERNED ABOUT
27 WHEN THEY HIRED YOU. THEY WANTED TO BE SURE OF THAT --
28 A THAT'S EXACTLY CORRECT.

10
1 Q -- THAT BUILDING THE HOTEL WOULD NOT
2 RESULT IN THE VACATION OF OR DIMINUTION OF THEIR PARKING
3 SPACES.
4 A YES. THAT'S A CORRECT STATEMENT.
5 Q AND YOU BELIEVE THAT WAS ACCOMPLISHED BY
6 THE DEED RESTRICTION WE'RE LOOKING AT, EXHIBIT B, BATES
7 524.
8 A CORRECT.
9 Q YOU ALSO TESTIFIED, IF YOU RECALL, THAT
10 YOU BELIEVE THAT THE RIGHTS THAT 601 GAVE TO THE OWNERS
11 OF 511 AND 517, WHOEVER THEY MIGHT BE, WERE IRREVOCABLE,
12 THAT THEY JUST COULDN'T TAKE THEM AWAY.
13 A IF YOU SAID "IRREVOCABLE," I AGREE.
14 Q YES. THAT'S WHAT I SAID. I THOUGHT I
15 DID. NOW, AT SOME STAGE, YOU UNDERSTOOD -- SHORTLY
16 BEFORE YOUR ARRANGEMENT WITH THE BUNGES TERMINATED, YOU
17 UNDERSTOOD THEY TRIED TO RECORD THE DEED RESTRICTION.
18 A YES.
19 Q AND THERE WAS SOME PROBLEMS WITH IT. THE
20 TITLE COMPANY SAID THEY DIDN'T THINK IT WAS RECORDABLE
21 OR SOMETHING TO THAT EFFECT; CORRECT?
22 A THERE WERE PROBLEMS WITH RECORDATION;
23 CORRECT.
24 Q NOW, WHEN THAT OCCURRED, DID YOU REPORT
25 THAT TO MR. AND MRS. BUNGE?
26 MR. BEECHEN: OBJECTION; CALLS FOR AN
27 ATTORNEY/CLIENT COMMUNICATION.
28 MR. BLECHER: JUST FOUNDATION.

11
1 THE COURT: OVERRULED.
2 MR. BLECHER: JUST FOUNDATION.
3 THE COURT: WELL, THAT DOESN'T ANSWER THE
4 OBJECTION, BUT IT SEEMS TO ME THAT SUFFICIENT
5 INFORMATION HAS BEEN -- THE AREA HAS BEEN OPENED UP AT
6 LEAST TO A LIMITED EXTENT SUFFICIENTLY TO ALLOW THE
7 QUESTION.
8 THE WITNESS: I HAD INFORMED JOSE BUNGE OF THE
9 RECORDATION PROBLEM.
10 Q BY MR. BLECHER: NOW, DID EITHER MR. OR
11 MRS. BUNGE EVER TELL YOU THEN, "CORIN, YOU TAKE CARE OF
12 GETTING IT RECORDED"?
13 A NO, I DON'T RECALL AN INSTRUCTION LIKE
14 THAT.
15 Q OR "REWRITE THE DOCUMENT IN A FORM THAT
16 WOULD MAKE IT RECORDABLE."
17 A I BELIEVE THAT WITHIN THE SCOPE OF THE
18 WORK I WAS GIVEN, I WAS EXPECTED TO WORK WITH THE TITLE
19 COMPANY TO GET IT RECORDED AS OPPOSED TO REWRITE IT.
20 Q AND DID YOU BELIEVE IT WAS -- COULD BE
21 RECONSTRUCTED IN RECORDABLE FORM?
22 A I BELIEVE THAT THIS -- I BELIEVE THAT THIS
23 AGREEMENT COULD HAVE BEEN PUT INTO A RECORDABLE FORM,
24 YES.
25 Q BUT THE BUNGES NEVER ASKED YOU TO DO THAT.
26 A I DON'T THINK THAT'S A CORRECT STATEMENT.
27 I WORKED WITH THE TITLE COMPANY TO TRY TO GET IT
28 RECORDED UP TO A POINT.

12
1 Q AND WHAT WAS THE PROBLEM THAT YOU
2 ENCOUNTERED?
3 A WELL, I WAS TOLD BY TITLE AT ONE POINT
4 THAT IT WAS NOT IN RECORDABLE FORM, AND I DON'T KNOW
5 THAT I WAS INVOLVED -- AT SOME POINT, MY PARTICIPATION
6 IN THAT PROCESS ENDED.
7 Q DO YOU RECALL SAYING THAT YOU THOUGHT THE
8 PROBLEM WITH RECORDING IT WAS THE TITLE, "DEED
9 RESTRICTION," AND THAT YOU CALLED IT "AN ANIMAL NOBODY
10 EVER HEARD OF"?
11 A I DIDN'T LIKE THE TITLE, "DEED
12 RESTRICTION." I DIDN'T THINK IT WAS AN ADEQUATE
13 DESCRIPTION OF WHAT WE WERE TRYING TO DO. SO I WOULDN'T
14 DENY MAKING A STATEMENT LIKE THAT, EVEN THOUGH I DON'T
15 RECALL THOSE WORDS.
16 Q IF WE JUST LABEL THIS "AGREEMENT BETWEEN
17 BUYER AND SELLER" OR SOMETHING LIKE THAT, DO YOU HAVE AN
18 OPINION AS TO WHETHER THAT WOULD HAVE BEEN RECORDABLE?
19 A I DON'T REMEMBER THAT THAT WAS THE PROBLEM
20 WITH RECORDATION. I DON'T THINK IT WAS THE TITLE THAT
21 WAS THE PROBLEM, BUT I CAN'T SAY THAT FOR CERTAIN.
22 Q BUT YOU KNOW THE TITLE WAS AT LEAST ONE OF
23 THE ISSUES?
24 A WELL, YOU'RE TELLING ME THAT THAT WAS A
25 CONVERSATION I HAD WITH SOMEBODY. I DON'T HAVE AN
26 INDEPENDENT RECOLLECTION OF THAT.
27 Q I'M GOING TO ASK YOU TO LOOK AT YOUR
28 DEPOSITION, SIR, WHICH IS AT PAGE 54.

13
1 A WHICH NOTEBOOK IS THAT? WHERE WILL I FIND
2 THAT?
3 Q WE'RE GOING TO GIVE IT TO YOU.
4 A OKAY. THANK YOU.
5 MR. BLECHER: CAN I DO THIS, YOUR HONOR?
6 Q MR. KAHN, JUST TO SEE IF WE CAN REFRESH
7 YOUR RECOLLECTION, CAN YOU GO TO PAGE 54 AT LINE 12 --
8 12 TO 14.
9 A YES, I HAVE.
10 Q THE QUESTION WAS, "WERE YOU EVER ASKED TO
11 REVISE THE DOCUMENT" -- IN CONTEXT, THAT'S THE DEED
12 RESTRICTION.
13 "WERE YOU EVER ASKED TO REVISE THE
DOCUMENT TO MAKE IT RECORDABLE?"
14
15 AND YOUR ANSWER WAS,
16 "NO, NOT TO MY RECOLLECTION."
17 A THAT'S STILL MY TESTIMONY.
18 MR. BEECHEN: YOUR HONOR, I WOULD JUST ASK THAT
19 HE READ TO LINE 20 TO MAKE IT A COMPLETE IDEA.
20 Q BY MR. BLECHER: 20 SAYS,
21 "I BELIEVE I HAD CONVERSATIONS
WITH BOTH ESCROW AND TITLE FOR THE
22 PURPOSE OF TRYING TO GET IT RECORDED. I
DON'T RECALL THEM COMING TO A
23 CONCLUSION, AND MY RECOLLECTION IS THAT
I WAS NO LONGER PART OF THE EFFORT TO
24 GET IT RECORDED AS IT PROCEEDED."
25 THAT MEANS YOUR ARRANGEMENT WITH THE BUNGES
26 TERMINATED WHILE THE RECORDATION ISSUE WAS STILL UP IN
27 THE AIR; IS THAT CORRECT?
28 A IT WASN'T AN ACTUAL TERMINATION, BUT I

14
1 WASN'T ASKED TO CONTINUE WITH ANYTHING ON BEHALF OF THE
2 BUNGES. THAT'S CORRECT.
3 Q AND THAT OCCURRED, WHATEVER YOU CALL IT,
4 WHILE THE RECORDATION WITH THE TITLE COMPANY WAS STILL
5 IN LIMBO.
6 A WELL, AS I WASN'T INVOLVED, I DON'T KNOW
7 THE ANSWER TO THAT QUESTION, BUT I ASSUME --
8 Q IT WASN'T CONCLUDED WHEN YOU LEFT.
9 A THAT'S CORRECT.
10 Q THEN IS IT CORRECT THAT YOU UNDERSTOOD
11 THAT IN THE CONTRACTS THEMSELVES THAT THE PARKING PART
12 WAS NOT A CONDITION PRECEDENT TO THE PURCHASE PART?
13 A I WANT TO ANSWER THIS QUESTION THIS WAY:
14 THERE WASN'T A NEGOTIATION WITH RESPECT TO THE CONDITION
15 PRECEDENT. THE AGREEMENTS WERE TIED, AND YOU CAN SEE
16 THAT THROUGHOUT THE DOCUMENTS, YOU CAN SEE THAT
17 THROUGHOUT THE NEGOTIATIONS, YOU CAN SEE THAT THROUGHOUT
18 THE E-MAILS. SO THE DEAL -- THE TWO DEALS WERE RELATED
19 AND TIED. I DON'T KNOW WHAT YOU MEAN BY "CONDITION
20 PRECEDENT."
21 Q LET ME ASK YOU TO LOOK AT PAGE 58 AT
22 LINE 6. DID YOU EVER --
23 MR. BEECHEN: WAIT. EXCUSE ME, COUNSEL.
24 THE COURT: WAIT. THIS IS -- THE OTHER PASSAGE
25 PURPORTEDLY WAS USED TO REFRESH RECOLLECTION. THIS IS
26 USED FOR A DIFFERENT PURPOSE; SO YOU'VE GOT TO GIVE ME
27 ALL THE LINES, AND YOU HAVE TO PROVIDE COUNSEL WITH TIME
28 TO TAKE A LOOK AND VOICE AN OBJECTION.

15
1 MR. BLECHER: LINE 6 TO 58, LINE 17.
2 MR. BEECHEN: YOUR HONOR, I WOULD JUST REQUEST --
3 I HAVE NO OBJECTION AS LONG AS HE READS TO PAGE 59,
4 LINE 5.
5 THE COURT: IS THAT ALL RIGHT?
6 MR. BLECHER: SURE.
7 THE COURT: OKAY. THEN LET'S PROCEED.
8 Q BY MR. BLECHER:
9 "QUESTION: DID YOU EVER HAVE AN
UNDERSTANDING THAT THE PURCHASE AND SALE
10 AGREEMENT WAS IN ANY WAY CONDITIONED ON
THE DEED RESTRICTIONS BEING INCLUDED OR
11 ACCEPTED OR RECORDED?
"ANSWER: THE QUESTION HAS, I
12 GUESS, LEGAL IMPLICATIONS THAT IS
CONDITIONED ON THE PRACTICAL STANDPOINT
13 AS WE TALKED ABOUT EARLIER IN THE
DEPOSITION. JOSE NEEDED PARKING BY THE
14 PROPERTIES. I DON'T THINK THERE WAS
EVER A CONDITION PRECEDENT EVER
15 NEGOTIATED OR ANYTHING OF THAT NATURE;
BUT, CLEARLY, WITHOUT PARKING, THE VALUE
16 OF THE PROPERTIES, 511 AND 517, WAS, IF
NOT SEVERELY DIMINISHED, MAYBE IT HAD NO
17 VALUE WHATSOEVER.
18 "QUESTION: WHEN YOU'RE SAYING
'WITHOUT PARKING' ARE YOU'RE TALKING
19 ABOUT THE AMENDED PARKING DEED
RESTRICTION OR THE EXISTING PARKING
20 RESTRICTION?
21 "ANSWER: WELL, GENERALLY
SPEAKING, UPON CLOSING THE 511 AND 517,
22 THE BUNGES WOULD HAVE PARKING PURSUANT
TO THE COASTAL DEVELOPMENT PERMIT. AND
23 THE ONLY TIME THAT WOULD CHANGE IS WHEN
AND IF THE BUNGES CHANGED THE USE. AND
24 MY UNDERSTANDING OF THE DEED RESTRICTION
WAS TO ENSURE THAT IF THE USE CHANGED AT
25 ANY OF THOSE THREE PROPERTIES, THEY
WOULD STILL HAVE PARKING. SO THEY WOULD
26 HAVE HAD THE PARKING THE MOMENT THE DEAL
CLOSED, AND THEY WOULD CONTINUE TO HAVE
27 PARKING IF ANYONE APPLIED TO CHANGE THE
USE OF THOSE THREE PROPERTIES."
28

16
1 IS THAT YOUR TESTIMONY, SIR?
2 A YES.
3 Q AND SO YOU UNDERSTOOD THAT, TECHNICALLY,
4 IN THE CONTRACT, NEITHER THE 511 OR THE 517 PURCHASE OR
5 THE PARKING ISSUE WERE CONDITIONED UPON ONE ANOTHER?
6 MR. BEECHEN: OBJECTION; VAGUE IN TERMS OF THE
7 USE "TECHNICALLY."
8 THE COURT: SUSTAINED.
9 Q BY MR. BLECHER: WHEN YOU SAID THERE WAS
10 NEVER A CONDITION PRECEDENT, WHAT DID YOU MEAN?
11 A THE FIRST TIME THE ISSUE OF CONDITION
12 PRECEDENT HAS BEEN PUT TO ME WAS A COUPLE OF MINUTES
13 AGO. IT WAS NOT A QUESTION IN THE DEPOSITION. AND SO
14 I'M A LITTLE BIT CONFUSED ABOUT WHERE WE'RE GOING. SO
15 ASK ME THE QUESTION AGAIN. I'M SORRY. YOU'RE TALKING
16 ABOUT THE TESTIMONY IN THE DEPOSITION, OR ARE YOU
17 TALKING ABOUT THE TESTIMONY THIS MORNING?
18 Q LOOKING AT THE TWO DOCUMENTS WHICH ARE IN
19 EVIDENCE AS EXHIBITS 31 AND 32, WOULD YOU AGREE WITH ME
20 THERE'S NOTHING IN THE DOCUMENT THAT CONDITIONS THE
21 PERFORMANCE OF ONE DOCUMENT ON THE OTHER?
22 A AGAIN, THERE'S NO LANGUAGE THAT SAYS THAT
23 THE PURCHASE OF THE PARKING RIGHTS, NOTWITHSTANDING A
24 CHANGE IN USE, IS A CONDITION PRECEDENT TO THE PURCHASE
25 AND SALE OF 511/517. BUT YOU'RE BUYING PARKING
26 RIGHTS -- THE DEED RESTRICTION TALKS ABOUT THE RIGHT TO
27 PARK AT 601 FOR THE USE OF THE OWNERS OF PROPERTIES AT
28 511 AND 517. SO THERE'S NO WAY YOU COULD DISCONNECT

17
1 THOSE TWO. I MEAN, I'M NOT SURE I REALLY UNDERSTAND THE
2 THRUST OF THE QUESTION. BUT THEY ARE TIED ON THEIR
3 FACE, AS FAR AS I'M CONCERNED.
4 THE COURT: MAY I ASK YOU A QUESTION?
5 THE WITNESS: SURELY.
6 THE COURT: YOU TOOK A LOOK AT THE -- AS PART OF
7 YOUR WORK, YOU TOOK A LOOK AT THE DEED RESTRICTION THAT
8 WAS ORIGINALLY FILED PURSUANT TO THE CALIFORNIA COASTAL
9 COMMISSION REQUIREMENTS.
10 THE WITNESS: YES, I DID.
11 THE COURT: CAN YOU TAKE A LOOK AT IT NOW? IT'S
12 EXHIBIT 2 THERE. AND I WOULD ASK YOU TO TAKE AT LOOK --
13 THERE ARE NUMBERS AT THE BOTTOM. I WOULD ASK YOU TO
14 TAKE A LOOK AT PAGE 4.
15 THE WITNESS: THAT WOULD BE PAGE 4 THAT HAS THE
16 SIGNATURE BLOCK AT THE BOTTOM?
17 THE COURT: YES. EXACTLY.
18 THE WITNESS: YES.
19 THE COURT: AND THERE'S A PARAGRAPH NEAR THE TOP
20 THAT'S NUMBERED 4.
21 THE WITNESS: YES.
22 THE COURT: WHICH SEEMS TO INDICATE THAT THE
23 PARKING SPACES MAY DISAPPEAR AT SOME POINT. THAT, IN
24 FACT, 601 WOULD CEASE TO MAKE THEM AVAILABLE. HOW
25 DID -- WERE YOU ASKED TO INTERPRET THAT DURING YOUR TIME
26 WITH THE BUNGES, OCTOBER TO DECEMBER 2007?
27 THE WITNESS: I WAS NOT ASKED TO SPECIFICALLY
28 INTERPRET THAT PARAGRAPH, NO.

18
1 THE COURT: DID YOU HAVE ANY OPINION ON HOW THAT
2 AFFECTED THE PARKING SPACES?
3 THE WITNESS: YES. THE COASTAL COMMISSION --
4 I'LL GIVE YOU A BRIEF BIT OF BACKGROUND. IT MAY BE
5 OBVIOUS TO EVERYBODY, BUT I'LL DO IT JUST FOR THE
6 RECORD. THERE IS NO PARKING IN THIS AREA, ABSOLUTELY NO
7 PARKING. AND THE RESIDENTS NEED PARKING AND ALL THE
8 BUSINESSES NEED PARKING AND THE TOURISTS NEED PARKING.
9 SO PARKING IS A VERY IMPORTANT ISSUE TO EVERYBODY.
10 THE COASTAL COMMISSION ALLOWED THE DEVELOPMENT OF
11 THESE FOUR PROPERTIES PROVIDED 601 WAS ESSENTIALLY
12 DEDICATED TO PARKING FOR THE BENEFIT OF THE OTHER THREE
13 PROPERTIES: 511, 517, 523.
14 I DON'T BELIEVE THAT PARAGRAPH 4 GIVES 601 THE
15 RIGHT TO TERMINATE PARKING. I BELIEVE THAT WHAT THE
16 COASTAL COMMISSION WAS DOING WAS, IN ESSENCE, STATING IN
17 THE EVENT SOMETHING SHOULD HAPPEN SUCH THAT 601 COULD
18 NOT PROVIDE PARKING -- AND I PRESUME THIS INVOLVES AN
19 ACT OF GOD, BECAUSE THERE IS A CONTINGENCY FOR BUILDING
20 ON 601, WHICH IS COVERED IN ANOTHER PART OF THIS COASTAL
21 DEVELOPMENT -- THAT THE USES AT THE OTHER THREE
22 PROPERTIES WOULD HAVE TO CEASE UNLESS SOMEBODY CAME TO
23 THE COASTAL COMMISSION WITH A NEW PARKING PLAN.
24 SO, ESSENTIALLY, WHAT THE COMMISSION WAS DOING
25 WAS SAYING, WE'LL GIVE YOU THE RIGHT TO USE THE THREE
26 PROPERTIES PROVIDED YOU'RE PARKING AT 601. BUT IF YOU
27 CAN'T PROVIDE PARKING AT 601 OR SOME OTHER PLACE THAT WE
28 APPROVE IN A SUBSEQUENT APPROVAL, YOU CAN'T USE THOSE

19
1 USES. THEY WILL HAVE TO CEASE.
2 THE COURT: OKAY. THANK YOU.
3 THE WITNESS: SO I DON'T THINK IT'S A RIGHT TO
4 TERMINATE. I THINK IT'S A CONSEQUENCE OF TERMINATION.
5 THE COURT: OKAY. THANK YOU. PLEASE PROCEED.
6 Q BY MR. BLECHER: IT'S YOUR OPINION, THEN,
7 THAT THE OWNER OF 601 COULD NOT ARBITRARILY OR FOR
8 WHATEVER REASON TERMINATE THE PARKING RIGHTS FOR THE
9 OTHER THREE LOTS?
10 A WELL, LET ME ANSWER IT THIS WAY: IF THE
11 OWNER OF ALL FOUR PROPERTIES WAS ONE OWNER, THAT OWNER
12 COULD CHOOSE TO DO WHATEVER THEY WANTED WITH THOSE FOUR
13 PROPERTIES. BUT BECAUSE THE CONDITION TO PROVIDE
14 PARKING RAN WITH THE LAND, THE MOMENT OWNERSHIP SEVERED,
15 THEN I DON'T BELIEVE 601 HAD THE RIGHT ANY LONGER TO
16 CEASE PARKING FOR THE OTHER THREE PROPERTIES.
17 Q ONE LAST AREA, MR. KAHN. AT SOME STAGE
18 YOU DRAFTED UP SOME DOCUMENTS CALLED OPTION OR PARKING
19 DEEDS. DO YOU RECALL THOSE?
20 A NO, I DIDN'T DRAFT A DOCUMENT.
21 Q YOU'RE RIGHT. THEY WERE SENT TO YOU BY
22 MR. FOLKERT.
23 A I DON'T REMEMBER HOW IT CAME TO ME, BUT I
24 DID LOOK AT A DOCUMENT THAT I BELIEVE WAS CALLED PARKING
25 OPTION OR SOMETHING OF THAT NATURE.
26 Q AND THAT DOCUMENT ACTUALLY NOW BEGAN TO
27 CHANGE THE PARKING RIGHTS FROM 38 FOR RETAIL USE DURING
28 BUSINESS HOURS NOW TO SOMETHING DIFFERENT THAN THAT;

20
1 CORRECT?
2 A I DON'T KNOW THAT IT CHANGED ANYTHING, BUT
3 IT USED LANGUAGE QUITE DIFFERENT FROM WHAT WE AGREED ON
4 THAT'S STATED IN THE DEED RESTRICTION.
5 Q AND, JUST BRIEFLY, WHAT WERE THE MAIN
6 DIFFERENCES YOU NOW RECALL?
7 A WELL, LET ME SAY THIS: I'M PRETTY SURE
8 THAT THIS DOCUMENT WAS GIVEN TO ME BY JOSE, NOT TED,
9 BECAUSE I WASN'T INVOLVED IN THE TRANSACTION ANY LONGER.
10 AND I WAS ASKED BY JOSE TO COMMUNICATE TO MR. FOLKERT
11 THAT THIS AGREEMENT WAS NOT ACCEPTABLE, THIS DOCUMENT,
12 WHATEVER IT WAS, WAS NOT ACCEPTABLE. I DIDN'T DO AN
13 EXTENSIVE REVIEW OF IT. I GLANCED AT IT.
14 Q BUT IF THE NATURE OF THE PARKING RIGHTS
15 UNDER THIS OPTION CHANGED FROM WHAT THEY WERE BEFORE --
16 A THAT'S MY UNDERSTANDING. IT WAS A
17 MATERIAL CHANGE IN THE TERMS I THOUGHT WE HAD COME TO AN
18 AGREEMENT ON AND CONTRACTUALLY AGREED TO.
19 Q DO YOU RECALL IF THAT CHANGE WAS AN
20 OUTGROWTH OF THE PROBLEM WITH RECORDING THE DEED
21 RESTRICTIONS THAT WE'VE LOOKED AT IN EXHIBIT 31?
22 MR. BEECHEN: OBJECTION, YOUR HONOR; VAGUE AS TO
23 TERM "OUTGROWTH."
25 Q BY MR. BLECHER: DO YOU RECALL THAT THIS
26 OPTION CONCEPT AROSE ONLY AFTER THERE WAS A PROBLEM WITH
27 RECORDING THE DOCUMENT WE'VE LOOKED AT AS EXHIBIT 31?
28 A I'LL ANSWER IT THIS WAY: IN TERMS OF MY

21
1 MEMORY OF THE SEQUENCE OF EVENTS, IT DID ARISE AFTER THE
2 ISSUE OF RECORDATION. THAT'S MY UNDERSTANDING.
3 Q AND DID YOU UNDERSTAND THAT AT SOME POINT
4 THE BUNGES NOW WANTED 24-HOUR-A-DAY PARKING?
5 A AS I SAID, I WASN'T INVOLVED ENOUGH TO
6 KNOW WHAT THE SUBSTANCE OF THE DISCUSSION WAS.
7 Q THANK YOU, MR. KAHN.
8 MR. BLECHER: I HAVE NOTHING FURTHER.
9 THE COURT: ALL RIGHT. MR. BEECHEN.
10 MR. BEECHEN: VERY BRIEF, YOUR HONOR.
11
12 CROSS EXAMINATION
13 BY MR. BEECHEN:
14 Q MR. KAHN, THERE WAS SOME REFERENCE TO THE
15 RECORDATION OF THIS NEW DEED RESTRICTION IN THIS
16 EXHIBIT B -- THAT DOCUMENT. AT THE TIME, WAS
17 RECORDATION PART OF THE DISCUSSION THAT WAS GOING ON
18 BETWEEN THE PARTIES? THAT IS, THAT THIS DOCUMENT WOULD
19 BE RECORDED?
20 A I THINK THE AGREEMENT REQUIRED IT TO BE
21 RECORDED, AND I THINK WE WERE MAKING EFFORT TO GET IT
22 RECORDED, AND I THINK MR. FOLKERT WAS INVOLVED IN THOSE
23 DISCUSSIONS.
24 Q WHY WAS IT IMPORTANT THAT THE DOCUMENT BE
25 RECORDED?
26 A WELL, APART FROM THE OBVIOUS LEGAL
27 QUESTION OF PROVIDING NOTICE, WE KNEW THAT THE SELLER
28 WAS INTERESTED IN SELLING 601 AS WELL; SO WE HAD AN

22
1 IMMEDIATE NOTICE ISSUE. THAT IS TO SAY, IF WE WERE
2 GOING TO EXPECT THAT WE HAD THE RIGHT TO PARKING IN
3 PERPETUITY, IT WOULD MEAN THAT SUBSEQUENT OWNERS OF 601
4 OUGHT TO BE ADVISED OF THAT DUTY. AND SO THAT WAS THE
5 REASON FOR RECORDATION.
6 Q BASED UPON YOUR EXPERIENCE, WOULD THE
7 COASTAL COMMISSION HAVE INSISTED THAT THIS DOCUMENT BE
8 RECORDED?
9 A YES. I HAVE ALMOST NO DOUBT ABOUT THAT.
10 Q OKAY.
11 MR. BEECHEN: NO FURTHER QUESTIONS.
12 THE COURT: I HAVE A QUESTION BASED UPON SOME
13 REFERENCE YOU MADE IN AN EARLIER ANSWER. YOU SEEMED TO
14 INDICATE THAT THE DEED RESTRICTION IN EXHIBIT 31 THAT'S
15 BATES STAMPED 524, THE ONE YOU LOOKED AT PREVIOUSLY, WAS
16 BOTH AN AGREEMENT BETWEEN THE BUNGES AND THE OWNER OF
17 601 AS WELL AS AN AGREEMENT TO RECORD. IF THE DOCUMENT
18 WAS NOT RECORDED, AS OCCURRED, DO YOU BELIEVE THAT THE
19 AGREEMENT FOR THE USE OF THOSE PARKING SPACES REMAINED
20 IN EFFECT?
21 THE WITNESS: YES. I THINK THAT THE RECORDATION
22 OBLIGATION PERTAINS TO THE BUYER'S INTEREST IN PROVIDING
23 NOTICE, BUT IT WOULDN'T CHANGE THE OBLIGATION BETWEEN
24 THE BUYER AND SELLER. SO I THINK THAT IT HAD IMMEDIATE
25 EFFECT BETWEEN BUYER AND SELLER, BUT WE ALSO HAD THE
26 ADDITIONAL OBJECTIVE OF RECORDING IT; SO WE GAVE NOTICE
27 TO THE UNIVERSE.
28 THE COURT: AND THAT WAS THE AGREEMENT BETWEEN

23
1 BUYER AND SELLER CONCERNING THE FUTURE USE OF 511 AND
2 517 AND THE AVAILABILITY OF THAT PARKING.
3 THE WITNESS: I'LL CORRECT THE COURT'S STATEMENT
4 IN ONE RESPECT. BY "FUTURE USE," DID YOU MEAN CHANGE IN
5 USE?
6 THE COURT: CHANGE IN USE.
7 THE WITNESS: WELL, I THINK ITS PURPOSE WAS TO DO
8 BOTH. TO BE SURE THAT THE PARKING -- THAT THERE WAS
9 NOTICE OF THE PARKING OBLIGATION WHETHER THE USE CHANGED
10 OR NOT AND IN THE EVENT THAT THERE WAS A CHANGE IN USE,
11 WHICH IS WHAT'S REFLECTED IN THE DEED RESTRICTION IN MY
12 OPINION.
13 THE COURT: IS IT YOUR OPINION, THEN, THAT
14 BECAUSE IT WAS SIGNED -- I'LL JUST LEAVE IT AT THAT.
15 ANY FURTHER QUESTIONS, MR. BLECHER?
16 MR. BLECHER: NO, YOUR HONOR.
17 THE COURT: ANY FURTHER QUESTIONS BASED UPON THE
18 COURT'S QUESTIONS, MR. BEECHEN?
19 MR. BEECHEN: NO, YOUR HONOR.
20 THE COURT: OKAY. EITHER SIDE WISH THAT THIS
21 WITNESS REMAIN ON CALL?
23 MR. BEECHEN: NOT NECESSARY.
24 THE WITNESS: THANK YOU VERY MUCH.
25 THE COURT: THANK YOU, MR. KAHN. APPRECIATE YOUR
26 ATTENDANCE. THANK YOU VERY MUCH.
27 WE HAVE A MR. PRASKE IN THE HALLWAY; IS THAT
28 CORRECT?

24
1 MR. BLECHER: HOPEFULLY.
2 THE COURT: I'VE SEEN HIM LOOKING IN THE WINDOW.
3 WHY DON'T WE GET ALL THE WITNESSES OUT OF HERE, SQUARED
4 AWAY, AND THEN WE CAN DO WHATEVER WE NEED TO DO. ALL
5 RIGHT? AND WHO'S CALLING MR. PRASKE AGAIN?
6 MR. BEECHEN, ARE YOU CALLING HIM?
7 MR. BEECHEN: I AM.
8 THE COURT: ALL RIGHT. LET'S BRING HIM IN, THEN.
9 MR. BLECHER: I TAKE IT, THEN, HE'S BEING CALLED
10 AS A REBUTTAL WITNESS.
11 MR. BEECHEN: THE FORMALITIES OF IT -- IF THEY
12 REST, THEN I DO RE-CALL HIM AS A REBUTTAL. BUT WE'RE
13 GOING TO GET INTO THE ISSUES OF ARENZANO. HOPEFULLY,
14 THIS WILL CLEAR UP AN OUTSTANDING ISSUE.
15 THE COURT: ALL RIGHT. I'M GOING TO ALLOW HIM TO
16 BE CALLED EITHER AS A REBUTTAL WITNESS OR IN THE REQUEST
17 TO REOPEN. ALL RIGHT.
18 MR. PRASKE, PLEASE COME FORWARD. I'M GOING TO
19 ASK YOU TO BE SWORN AGAIN BECAUSE OF THE LENGTH OF TIME
20 THAT HAS ELAPSED.
21
22 JOSEPH PRASKE,
23 CALLED ON BEHALF OF THE PLAINTIFF, HAVING BEEN DULY
24 SWORN, WAS EXAMINED AND TESTIFIED AS FOLLOWS:
25 THE CLERK: DO YOU SOLEMNLY STATE --
26 THE COURT: I'M SORRY. MS. BUNGE, YOU WENT INTO
27 THE JURY DELIBERATION AREA?
28 COURTROOM ASSISTANT: SHE USED THE RESTROOM.

25
1 THE COURT: NEXT TIME OUTSIDE.
2 GO AHEAD.
3 THE CLERK: DO YOU SOLEMNLY STATE THAT THE
4 TESTIMONY YOU MAY GIVE IN THE CAUSE NOW PENDING BEFORE
5 THIS COURT SHALL BE THE TRUTH, THE WHOLE TRUTH, AND
6 NOTHING BUT THE TRUTH, SO HELP YOU GOD?
7 THE WITNESS: YES, I DO.
8 THE CLERK: PLEASE BE SEATED.
9 THE COURT: PLEASE HAVE A SEAT. AND I'LL ASK YOU
10 SIMPLY TO STATE YOUR NAME SINCE YOU'VE TESTIFIED BEFORE.
11 THE WITNESS: JOSEPH PRASKE.
12 THE COURT: LET'S PROCEED.
13
14 DIRECT EXAMINATION
15 BY MR. BEECHEN:
16 Q MR. PRASKE, ARE YOU FAMILIAR WITH A
17 LAWSUIT ENTITLED GAGGERO VERSUS YURA, Y-U-R-A?
18 A I'M FAMILIAR WITH IT.
19 Q AND, IN FACT, YOU TESTIFIED IN THAT CASE;
20 CORRECT?
21 A YES, BUT NOT TOO MANY DETAILS.
22 Q ALL RIGHT. AND IN THAT CASE, MR. GAGGERO
23 WAS SEEKING TO PURCHASE A PIECE OF PROPERTY FROM THE
24 DEFENDANTS. DO YOU RECALL THAT?
25 A YES.
26 Q AND THAT YOU WERE CALLED AS A WITNESS TO
27 DISCUSS HOW MR. GAGGERO WAS GOING TO PAY FOR THAT
28 PROPERTY. DO YOU RECALL YOUR PROVIDING TESTIMONY ON

26
1 THAT ISSUE?
2 A YES.
3 Q NOW, IN THAT TESTIMONY, YOU DEFINED THE
4 ARENZANO TRUST AS ONE OF THE TRUSTS HOLDING THE ASSETS
5 OR AT LEAST RECEIVING THE BENEFITS OF THE ASSETS THAT
6 MR. GAGGERO HAD PLACED AS PART OF HIS ESTATE PLAN;
7 CORRECT?
8 A WELL, I CAN'T SAY CORRECT. I'M NOT SURE
9 YOUR CHARACTERIZATION, BUT, I MEAN, I REMEMBER THAT
10 TESTIMONY SOMEWHAT.
11 Q OKAY. AND YOU DESCRIBED THAT THE ARENZANO
12 TRUST HAS A CLASS OF BENEFICIARIES; CORRECT?
13 A I'D LIKE TO SEE IT, BUT I THINK THAT'S
14 CORRECT SO FAR. I DON'T WANT TO SAY EXACTLY, BECAUSE
15 I'M NOT FAMILIAR WITH THAT TESTIMONY OFF THE TIP OF MY
16 TONGUE. BUT TO A CERTAIN EXTENT, YES.
17 Q WELL, THE ARENZANO TRUST HAS A CLASS OF
18 BENEFICIARIES; CORRECT?
19 A YES.
20 Q AND THAT CLASS OF BENEFICIARIES IS THE
21 FAMILY OF STEVE GAGGERO; CORRECT?
22 A YEAH, IN A VERY BROAD SENSE PER THE
23 STATUTE UNDER WHICH IT WAS CREATED.
24 Q ALL RIGHT. AND IT SAYS, IN FACT, THE
25 BENEFICIARIES ARE THE FAMILY MEMBERS OF STEVE GAGGERO.
26 THAT'S WHAT IT SAYS IN THIS TRUST; CORRECT?
27 A YES.
28 Q AND STEVE GAGGERO IS, IN FACT, A

27
1 BENEFICIARY OF THE ARENZANO TRUST; CORRECT?
2 A NO. I DON'T THINK SO.
3 Q WELL, IF YOU COULD LOOK AT PAGE 992, 13.
4 LET ME JUST READ IT TO YOU. 992, 13 TO 993, 20.
5 THE COURT: ONE MOMENT. IS THERE ANY OBJECTION?
7 THE COURT: PLEASE PROCEED.
8 MR. BEECHEN:
9 "QUESTION: NOW, YOU SPENT SOME
TIME TALKING ABOUT THESE TRUSTS THAT
10 WERE FORMED. THE FIRST ONE, THE
ARENZANO -- I'M SORRY. THE FIRST ONE I
11 THINK YOU SAID WAS THE AQUASANTE; IS
THAT RIGHT?
12
"ANSWER: AQUASANTE FOUNDATION.
13
"QUESTION: WHO WAS THE
14 BENEFICIARY OF THE AQUASANTE FOUNDATION?
15 "ANSWER: THERE IS A CLASS OF
BENEFICIARIES.
16
"QUESTION: WHAT DO YOU MEAN, 'A
17 CLASS OF BENEFICIARIES'?
18 "ANSWER: IT'S THE CLASS COMPRISED
OF THE VARIOUS MEMBERS OF THE GAGGERO
19 FAMILY.
20 "QUESTION: WELL, I MEAN, IS THE
BENEFICIARY OF THE AQUASANTE FOUNDATION
21 A SERIES OF INDIVIDUALS, OR IS IT SOME
OTHER SORT OF ENTITY?
22
"ANSWER: IT'S A SERIES OF
23 INDIVIDUALS.
24 "QUESTION: WHO ARE THE
BENEFICIARIES OF THE AQUASANTE
25 FOUNDATION?
26 "ANSWER: ANYONE IN THE GAGGERO
FAMILY.
27
"QUESTION: IS THERE A TRUST
28 INSTRUMENT?

28
1 "ANSWER: YES.
2 "QUESTION: AND DOES THE TRUST
INSTRUMENT LIST THE BENEFICIARIES?
3
"ANSWER: NO.
4
"QUESTION: WHAT DOES IT SAY IN
5 THE TRUST INSTRUMENT AS TO WHO THE
BENEFICIARIES ARE?
6
"ANSWER: ANY MEMBER OF THE
7 GAGGERO FAMILY.
8 "QUESTION: DOES IT DEFINE THE
GAGGERO FAMILY?
9
"ANSWER: IT SAYS 'ANY MEMBER OF
10 THE FAMILY OF MR. GAGGERO.'
11 "QUESTION: STEPHEN GAGGERO?
12 "ANSWER: YES.
13 "QUESTION: JR.?
14 "ANSWER: YES.
15 "QUESTION: AND WHO IS THE
BENEFICIARY OF THE ARENZANO TRUST?
16
"ANSWER: THE SAME.
17
"QUESTION: IT'S DEFINED THE EXACT
18 SAME WAY?
19 "ANSWER: YES."
20 MR. BLECHER: I THINK WE NEED TO READ THE WHOLE
21 NEXT PAGE, YOUR HONOR.
22 THE COURT: THE WHOLE NEXT PAGE?
23 MR. BLECHER: 994.
24 THE COURT: UP TO WHAT LINE?
25 MR. BLECHER: AT LEAST LINE 16.
26 THE COURT: DO YOU HAVE ANY OBJECTION TO DOING
27 THAT?
28

29
1 MR. BEECHEN: NO.
2 THE COURT: ALL RIGHT. PLEASE PROCEED.
3 MR. BEECHEN: NO, WAIT. IF WE'RE GOING TO GO
4 THAT FAR, WE'VE GOT TO GO A LITTLE FURTHER, I'M AFRAID.
5 I THINK TO 995, LINE 28.
6 THE COURT: IS THERE AN OBJECTION TO THAT?
7 MR. BLECHER: I GUESS WE NEED THE NEXT TWO LINES
8 OF 996.
9 THE COURT: IS THAT ALL RIGHT?
10 MR. BEECHEN: SURE. TO LINE 3?
11 THE COURT: LINE 3.
12 MR. BEECHEN: ALL RIGHT. STARTING AT 993,
13 LINE 21:
14 "QUESTION: AND HAD YOU EVER HAD A
DISCUSSION WITH MR. GAGGERO ABOUT WHO
15 THE BENEFICIARIES OF THESE TRUSTS WERE?
16 "ANSWER: YOU MEAN BEYOND WHAT
I'VE JUST DESCRIBED TO YOU?
17
"QUESTION: NO. WHAT YOU'VE JUST
18 DESCRIBED TO ME.
19 "THE COURT: JUST ANSWER THE
QUESTION. TAKE EACH QUESTION SEPARATELY
20 AND INDIVIDUAL.
21 "THE WITNESS: YES.
22 "QUESTION BY MR. ROSEN: YOU DID
HAVE DISCUSSION WITH MR. GAGGERO ABOUT
23 THAT; CORRECT?
24 "YES.
25 "QUESTION: AND, IN YOUR MIND,
MR. GAGGERO KNEW THAT HE WAS THE
26 BENEFICIARY OF THESE TRUSTS; RIGHT?
27 "MR. BEZIK: OBJECTION;
IRRELEVANT, ALSO CALLS FOR SPECULATION
28 AND CONJECTURE, AND NO FOUNDATION.

30
1 "THE COURT: OVERRULED.
2 "THE WITNESS: REPEAT THE
QUESTION.
3
"IN YOUR MIND, MR. GAGGERO KNEW
4 THAT HE WAS THE BENEFICIARY OF THESE
TRUSTS.
5
"ANSWER: NO.
6
"QUESTION: IN YOUR MIND, DID YOU
7 THINK HE DIDN'T KNOW?
8 "ANSWER: NO. HE KNEW THAT HE WAS
NOT THE BENEFICIARY OF THESE TRUSTS.
9
"QUESTION: HE KNEW THAT HE -- HE
10 KNEW HE WAS NOT THE BENEFICIARY OF THESE
TRUSTS?
11
"ANSWER: CORRECT.
12
"QUESTION: AND YOU HAD -- WELL --
13
"THE COURT: I THINK WE HAVE A
14 DIFFERENCE BETWEEN A BENEFICIARY AND THE
BENEFICIARY. I THINK THAT'S WHAT THE
15 ISSUE IS.
16 "QUESTION BY MR. ROSEN: IN YOUR
MIND, DID MR. GAGGERO KNOW THAT HE WAS A
17 BENEFICIARY OF THE TRUST?
18 "ANSWER: YES, A POTENTIAL
BENEFICIARY OF THE TRUST.
19
"QUESTION: THAT'S NOT A FACT THAT
20 YOU EVER HID FROM MR. GAGGERO, IS IT?
21 "ANSWER: NO.
22 "QUESTION: AND, IN FACT, YOU, IN
EXPLAINING THESE INSTRUMENTS, AFFIRMED
23 AND TOLD MR. GAGGERO THAT HE WAS A
BENEFICIARY OF THESE TRUSTS.
24
"ANSWER: NO.
25
"MR. BEZIK: OBJECTION; COMPOUND.
26
"THE WITNESS: THAT'S NOT WHAT I
27 SAID.
28 "THE COURT: THAT IS A QUESTION.
ASKING YOU IF YOU TOLD HIM HE WAS A

31
1 BENEFICIARY OF THE TRUST. DID YOU NOT
TELL HIM HE WAS A BENEFICIARY?
2
"THE WITNESS: HE WAS A POTENTIAL
3 BENEFICIARY.
4 "THE COURT: A POTENTIAL
BENEFICIARY?
5
"THE WITNESS: YEAH.
6
"QUESTION BY MR. ROSEN:
7 MR. PRASKE, WHAT'S THE DIFFERENCE
BETWEEN BEING A BENEFICIARY AND BEING A
8 POTENTIAL BENEFICIARY?
9 "ANSWER: BEING A POTENTIAL
BENEFICIARY MEANS IT IS UP TO THE
10 TRUSTEE TO DECIDE EACH YEAR AMONG THE
CLASS OF BENEFICIARIES WHO WILL BE --
11 WHO WILL RECEIVE DISTRIBUTABLE INCOME.
12 "QUESTION: AND YOU ARE THE
TRUSTEE; RIGHT?
13
"ANSWER: YES.
14
"QUESTION: SO YOU HAD THE
15 DISCRETION TO DECIDE WHICH BENEFICIARY
WOULD RECEIVE ANYTHING FROM THE TRUST;
16 IS THAT ACCURATE?
17 "ANSWER: YES.
18 "QUESTION: DID YOU HAVE TO DECIDE
IF SOMEONE WOULD RECEIVE SOMETHING?
19
"ANSWER: YES.
20
"COULD MORE THAN ONE PERSON
21 RECEIVE SOMETHING?
22 "ANSWER: YES.
23 "AND YOU HAD THAT DISCRETION IN
YOUR SOLE AND ABSOLUTE AUTHORITY; RIGHT?
24
"ANSWER: YES."
25
26 Q NOW -- AND, IN FACT, IN 2007, 2008, EVEN
27 NOW, MR. PRASKE, MR. GAGGERO REMAINS WHAT YOU CALL A
28 POTENTIAL BENEFICIARY; CORRECT?

32
1 A NO. THIS WAS IN 2005. HE'S CERTAINLY NOT
2 RECEIVED ANY DISTRIBUTIONS SINCE 2005.
3 Q WELL, THAT'S NOT WHAT MY QUESTION WAS,
4 SIR.
5 A AND I DON'T CONSIDER HIM A BENEFICIARY OF
6 THE -- OF THAT TRUST.
7 Q HE'S A POTENTIAL BENEFICIARY?
8 A NO, NOT AT THIS TIME.
9 Q HE'S A MEMBER OF THE GAGGERO FAMILY;
10 CORRECT?
11 A YES, OF COURSE.
12 Q AND HAS THE BENEFICIARY DESIGNATION BEEN
13 CHANGED IN THE ARENZANO TRUST?
14 A NO, THAT'S NOT REQUIRED.
15 Q BUT IT HAS NOT BEEN CHANGED; IS THAT
16 CORRECT? THE BENEFICIARY REMAINS THE GAGGERO FAMILY.
17 A UNDER THE TERMS OF THE TRUST, THAT'S
18 THE -- THAT'S THE DEFINITION OF THE BENEFICIARY.
19 Q AND THAT WOULD INCLUDE STEPHEN GAGGERO;
20 CORRECT? HE FALLS WITHIN THE GAGGERO FAMILY; CORRECT?
21 A NO. NO, NO, NO. I HAVE THE SOLE AND
22 ABSOLUTE DISCRETION, AND I CAN EXCLUDE A BENEFICIARY.
23 AND I HAVE DONE SO SINCE THEN.
24 Q I UNDERSTAND THAT, SIR. BUT HE REMAINS A
25 MEMBER OF THE GAGGERO FAMILY, WHO'S THE NAMED
26 BENEFICIARY UNDER THIS TRUST; CORRECT?
27 A YES, BUT THAT'S INCOMPLETE. I HAVE THE
28 POWER TO EXCLUDE, AND I HAVE EXCLUDED.

33
1 THE COURT: THAT EXCLUSION DECISION, THOUGH, CAN
2 BE CHANGED AT ANY TIME; IS THAT CORRECT? BY YOU?
3 THE WITNESS: NO. I MEAN, I HAVE THE POWER, AND
4 THAT POWER INCLUDES THE POWER TO MAKE IT PERMANENT, AND
5 I HAVE DONE SO.
6 Q BY MR. BEECHEN: YOU HAVE THE POWER TO
7 INCLUDE AND EXCLUDE; CORRECT?
8 A NO. I HAVE THE POWER TO EXCLUDE.
9 DEPENDS -- I CAN INCLUDE, EXCLUDE. BUT IF I EXERCISE
10 THAT POWER TO EXCLUDE, AND I MAKE IT IRREVOCABLE, THEN I
11 NO LONGER HAVE THE POWER TO CHANGE THAT OVER, THAT
12 PARTICULAR BENEFICIARY.
13 Q AND HAS THAT BEEN DONE IN WRITING?
14 A YES.
15 Q THIS POWER TO EXCLUDE? SO THAT'S
16 SOMETHING THAT YOU HAVE AVAILABLE TO YOU IN WRITING?
17 A I -- IT'S PART OF THE TRUST PAPERS.
18 Q AND WHEN DID THAT OCCUR?
19 A I DON'T RECALL. I WOULD SAY SOMETIME
20 SINCE 2004, 2005, THAT TIME FRAME.
21 THE COURT: BEFORE OR AFTER THIS TESTIMONY THAT
22 WAS READ?
23 THE WITNESS: I'M NOT SURE. I THINK THAT -- THIS
24 TESTIMONY REGARDED EVENTS PRIOR TO THE TIME OF THE
25 TESTIMONY; SO I DON'T KNOW EXACTLY WHEN THAT EXCLUSION
26 OCCURRED, BUT I'D STILL SAY SOMETIME AROUND 2004/2005
27 TIME FRAME.
28 Q BY MR. BEECHEN: WELL, ISN'T IT CORRECT

34
1 THIS TESTIMONY OCCURRED IN 2007?
2 A I'M NOT SURE.
3 MR. ANDREWS: 2005.
4 MR. BEECHEN: WAIT. HOLD ON.
5 THE WITNESS: I THINK 2005.
6 MR. ANDREWS: PAGE 901.
7 MR. BEECHEN: YES. EXCUSE ME, 901. JUNE 30,
8 2005.
9 Q IS THAT RIGHT, MR. PRASKE?
10 A THAT'S WHAT IT SAYS, YES.
11 Q OKAY. NOW, YOU ALSO, IN THIS TRIAL,
12 TALKED ABOUT THE ROLE OF MR. GAGGERO IN CONNECTION WITH
13 MAKING DECISIONS ABOUT THE REAL ESTATE HOLDINGS OF THESE
14 VARIOUS LIMITED PARTNERSHIPS, LIMITED LIABILITY
15 COMPANIES, THAT IS ALL OF THE REAL ESTATE ASSETS WHICH
16 HAD BEEN PART OF THE GAGGERO ESTATE PLAN; CORRECT?
17 A NO.
18 Q DIDN'T YOU TESTIFY THAT MR. GAGGERO IS THE
19 ONE WHO MAKES THE DECISIONS -- MAKES ALL THE DECISIONS
20 ABOUT THE REAL ESTATES HOLDINGS OF THESE TRUSTS AND
21 THESE LIMITED PARTNERSHIPS AND THESE LLCS?
22 A WELL, I PREFER TO SEE IT, IF THAT'S WHAT I
23 SAID, BUT I DON'T THINK I WOULD HAVE SAID THAT HE HAD
24 THE DECISION-MAKING AUTHORITY. HE DOESN'T.
25 Q NO. YOU HAVE TO SIGN THE PIECES OF PAPER;
26 CORRECT?
27 A I MAKE THE DECISIONS.
28 Q AND HE TELLS YOU WHAT TO DO; CORRECT?

35
1 A NO.
2 Q OKAY. LET'S TAKE A LOOK AT EXHIBIT 113 AT
3 PAGE 1002, LINE 16 TO PAGE 1003, LINE 3.
4 A OKAY.
5 THE COURT: OBJECTION?
6 MR. BEECHEN: MAY I PROCEED?
7 THE COURT: I'M ASKING FOR ANY OBJECTION. ANY
8 OBJECTIONS?
10 MR. BEECHEN:
11 "QUESTION: NOW, YOU TESTIFIED
THAT MR. GAGGERO IS THE MANAGER OVER ALL
12 THIS REAL ESTATE; IS THAT CORRECT?
13 "ANSWER: YES.
14 "QUESTION: HE'S THE ONLY ONE THAT
MAKES DECISIONS ABOUT THE REAL ESTATE
15 HELD WITHIN ALL THESE VEHICLES OWNED BY
THE TRUST; RIGHT?
16
"ANSWER: THERE MIGHT BE OTHER
17 PEOPLE INVOLVED, BUT THAT WOULD BE UP TO
HIM. I LOOK TO HIM FOR MAKING THOSE
18 DECISIONS.
19 "QUESTION: IN OTHER WORDS, THERE
MIGHT BE OTHER PEOPLE WORKING UNDER HIM,
20 BUT HE'S THE DECISION MAKER; CORRECT?
21 "ANSWER: YES.
22 "AS TO ALL THE ASSETS? AS TO ALL
ASPECTS?
23
"ANSWER: ALL ASPECTS OF THE
24 PROPERTY.
25 "REAL PROPERTY HELD BY THE TRUST?
26 "ANSWER: YES."
27 LET ME ALSO READ 941, LINE 1 THROUGH 6.
28 Q NOW, BEFORE THAT, MR. GAGGERO WAS THE

36
1 MANAGER OF THE ASSETS -- CORRECT? -- THROUGH PACIFIC
2 COAST MANAGEMENT IN 2007?
3 A MANAGED THE ASSETS, YEAH. THE REAL
4 PROPERTY ASSETS.
5 Q YEP. ALL RIGHT. SO READING AGAIN 941, 1
6 THROUGH 6, AND I'LL WAIT TO HEAR FROM COUNSEL.
7 MR. BLECHER: NO OBJECTION.
8 THE COURT: PLEASE PROCEED.
9 MR. BEECHEN:
10 "QUESTION: WHAT ARE THE DUTIES OF
A MANAGER OF THE ASSETS?
11
"ANSWER: HE HANDLES ALL THINGS
12 RELATED TO THE REAL ESTATE PORTFOLIO.
13 "QUESTION: DOES THAT INCLUDE BOTH
PURCHASES AND SALES?
14
"ANSWER: BUYING AND SELLING,
15 FINANCING, TRADING, EVERYTHING."
16 NO FURTHER QUESTIONS.
17 THE COURT: ALL RIGHT. MR. BLECHER?
18 MR. BLECHER: JUST ONE OR TWO, YOUR HONOR.
19
20 CROSS EXAMINATION
21 BY MR. BLECHER:
22 Q DO YOU STILL HAVE THE TRANSCRIPT IN FRONT
23 OF YOU, MR. PRASKE?
24 A YES.
25 Q AND AT PAGE 1002, DO YOU SEE THE QUESTION
26 AND ANSWER STARTING AT LINE 19 TO LINE 24? "QUESTION:
27 HE'S THE ONLY ONE --
28 THE COURT: WAIT, WAIT, WAIT. WHAT IS THIS BEING

37
1 USED FOR? IF YOU'RE READING IT INTO THE RECORD, THEN
2 THE OTHER SIDE HAS TO HAVE AN OPPORTUNITY TO OBJECT.
3 MR. BLECHER: THEY HAVE READ IT ALREADY, YOUR
4 HONOR. THEY READ THIS. I'M JUST CROSS EXAMINING HIM.
5 MR. BEECHEN: WE DID READ IT INTO THE RECORD.
6 THE COURT: OKAY. THEN WE DON'T NEED TO READ IT
7 AGAIN.
8 Q BY MR. BLECHER: SO IF YOU LOOK AT THE
9 LINES 19 TO 24, YOUR ANSWER THERE IS:
10 "THERE MIGHT BE OTHER PEOPLE
INVOLVED, BUT THAT WOULD BE UP TO THEM.
11 I LOOK TO HIM FOR MAKING THOSE
DECISIONS."
12
13 DO YOU SEE THAT?
14 A YES.
15 Q WHAT DO YOU MEAN BY "I LOOK TO HIM"?
16 A HIS INVOLVEMENT IS WITH MANAGEMENT OF THE
17 PROPERTY. OBVIOUSLY, HE'S NOT THE PAID DECISION MAKER.
18 HE'S NOT -- HE DOESN'T HAVE THE POWER TO MAKE THOSE
19 DECISIONS. HE'S THE MANAGER, JUST LIKE ANY PROPERTY
20 MANAGER.
21 Q WHEN YOU SAY, "I LOOK TO HIM," DOES THAT
22 IMPLY THAT YOU HAVE THE POWER AND THAT HE HAS TO
23 PERSUADE YOU --
24 MR. BEECHEN: OBJECTION; LEADING.
26 Q BY MR. BLECHER: WHO HAS THE ULTIMATE
27 DECISION-MAKING POWER?
28 A I DO.

38
1 Q OKAY. AND YOU ARE NOT AN EXPERT IN REAL
2 ESTATE, ARE YOU?
3 A NO.
4 Q AND YOU CONSIDER MR. GAGGERO TO BE AN
5 EXPERIENCED PERSON WITH EXPERTISE IN THE BUYING AND
6 SELLING AND MANAGING OF REAL PROPERTY; CORRECT?
7 A YEAH. THAT'S WHY I HIRED HIM.
8 Q AND THAT'S WHY YOU RELY HEAVILY ON HIM IN
9 MAKING DECISIONS ABOUT THE PURCHASE, SALE, AND USE OF
10 THE PROPERTY.
11 A YES.
12 Q BUT AT ALL TIMES, YOU HAVE THE FINAL WORD?
13 A YES.
14 Q IF HE CAME UP WITH SOME HAREBRAINED SCHEME
15 THAT YOU THOUGHT WAS RIDICULOUS, YOU COULD TELL HIM NO.
16 A YES. I THINK I'VE DONE SO SEVERAL TIMES
17 IN THE PAST.
18 MR. BLECHER: THANK YOU.
19 THE COURT: ANYTHING FURTHER, MR. BEECHEN?
20
21 REDIRECT EXAMINATION
22 BY MR. BEECHEN:
23 Q WELL, MR. PRASKE, HOW DO YOU EXPLAIN YOUR
24 ANSWER AT LINES 25 THROUGH 27 OF PAGE 1002, IN WHICH YOU
25 STATE, "HE'S THE DECISION MAKER"?
26 A WITH REGARD TO MANAGEMENT. IT'S NO
27 DIFFERENT THAN ANY OTHER PROPERTY MANAGER.
28 MR. BEECHEN: NO FURTHER QUESTIONS, YOUR HONOR.

39
1 THE COURT: ANY FURTHER QUESTIONS?
3 THE COURT: THANK YOU, MR. PRASKE. THANK YOU
4 VERY MUCH, SIR. APPRECIATE YOU COMING BACK AGAIN.
5 WHY DON'T WE TAKE -- IS THAT IT FOR WITNESSES?
6 ARE WE DONE?
7 MR. BEECHEN: WE ARE.
8 MR. BLECHER: WE DO WANT TO TENDER SOME EXCERPTS
9 FROM MR. BUNGE'S DEPOSITION, BUT I ASSUME, IN A NONJURY
10 TRIAL, YOU JUST WANT THOSE SUBMITTED TO YOU WITHOUT
11 HAVING THEM READ IN THE RECORD.
12 THE COURT: WELL, YOU NEED TO TALK TO THE OTHER
13 SIDE. THEY OUGHT TO HAVE AN OPPORTUNITY TO OBJECT.
14 WHATEVER THE BOTH SIDES AGREE TO, I'LL TAKE A LOOK AT.
15 IT DEPENDS ON THE EXTENT OF THE QUESTION AND ANSWER, AND
16 THE OTHER SIDE MAY WANT AN OPPORTUNITY TO PROVIDE OTHER
17 PORTIONS OF ANY DEPOSITION.
18 AT THIS POINT, THOUGH, LET'S TAKE A RECESS, 15
19 MINUTES. THE ATTORNEYS ARE ORDERED TO APPEAR.
20 (RECESS TAKEN FROM 11:02 TO 11:21 A.M.)
21 THE COURT: BACK ON THE RECORD. THE ATTORNEYS
22 ARE ONCE AGAIN PRESENT. ALL RIGHT. SO WHAT ARE WE
23 DOING AT THIS POINT?
24 MR. BEECHEN: TWO THINGS. ONE IS I WAS JUST
25 HANDED THIS APPROXIMATELY HALF INCH OF DEPOSITION
26 TESTIMONY OF MR. BUNGE. WHAT I WOULD REQUEST IS THAT I
27 BE ALLOWED TO SUBMIT TO THE COURT -- AND I CAN DO IT
28 THIS WEEK -- A STATEMENT EITHER OBJECTING, NOT

40
1 OBJECTING, OR SUBMITTING OTHER DEPOSITION TESTIMONY IN
2 ORDER TO EXPLAIN WHAT'S BEEN CITED. I HAVE NOT HAD A
3 CHANCE, OBVIOUSLY, TO REALLY LOOK AT THIS.
4 THE COURT: THAT SEEMS REASONABLE.
5 MR. BEECHEN: BUT THAT WOULD BE THE WAY TO DEAL
6 WITH IT RATHER THAN SIT HERE AND GO THROUGH IT RIGHT
7 NOW. THAT TO ME --
8 MR. BLECHER: THAT'S AGREEABLE, YOUR HONOR. WE
9 WOULD LIKE TO LODGE THE TESTIMONY, THEN, WITH THE CLERK.
10 THE COURT: WELL, I CAN ONLY TAKE IT AFTER IT'S
11 REVIEWED FOR OBJECTIONS. WELL, ON THE OTHER HAND,
12 EVENTUALLY, I'M GOING TO HAVE TO GET IT ANYWAY.
13 MR. BEECHEN: I HAVE NO OBJECTION TO IT BEING
14 LODGED.
15 THE COURT: ALL RIGHT. LET'S LODGE IT, THEN.
16 MR. BEECHEN: AND, YOU KNOW, YOU'LL TAKE IT IN
17 DUE COURSE, YOUR HONOR. I UNDERSTAND THAT.
18 THE COURT: OKAY. THERE WAS ALSO -- I KNOW YOU
19 HAVE OTHER ISSUES.
20 MR. BEECHEN: THAT'S ALL RIGHT.
21 THE COURT: THERE WAS THE ISSUE OF MR. PRASKE'S
22 BRIEF THAT HE WAS GOING TO FILE, BUT IT'S MY
23 UNDERSTANDING THAT THAT ONLY GOES TO THE ALTER EGO
24 ISSUES; RIGHT?
25 MR. BEECHEN: CORRECT. IT GOES TO THE TRUST
26 ISSUES, YES.
27 THE COURT: THEN WHAT I'D LIKE TO DO, AS I THINK
28 ABOUT THIS, IS SEPARATE OUT THE ALTER EGOS ISSUES FROM

41
1 THE REST OF THE ITEMS TO BE DETERMINED. I'D LIKE TO GET
2 MOVING ON THE REST OF IT. IS THERE ANY OBJECTION TO
3 DOING THAT, OR DO YOU WANT TO DO IT AS A PACKAGE? IT'S
4 UP TO YOU. I'M HAPPY TO DO IT BOTH WAYS.
5 MR. BEECHEN: MY CONCERN IS, YOUR HONOR, IF WE
6 DON'T ADDRESS THE ALTER EGO ISSUES, AND YOU ALMOST HAVE
7 TO ASSUME, THEN -- WELL, THE QUESTION IS WHAT DO YOU
8 ASSUME IN RULING ON THESE OTHER CLAIMS? IN OTHER WORDS,
9 IF YOU SAY, WELL, IF IT ALL IS JUST ONE ENTITY, THEN,
10 YOU KNOW, THE FAILURE OF ONE PART -- DOES THAT MEAN IT'S
11 THE FAILURE OF THE WHOLE? OR IF IT'S NOT ONE ENTITY,
12 THEN THE FAILURE OF ONE PART MAY NOT IMPACT THE FAILURE
13 OF THE WHOLE. NOT -- I MEAN, WE TAKE THE POSITION IT'S
14 ONE TRANSACTION, AND WE'VE ARGUED THAT TO YOU MANY
15 TIMES. SO MY CONCERN IS THAT -- IS IT REALLY POSSIBLE
16 TO SEPARATE OUT ONE FROM THE OTHER?
17 NOW, IF YOU SAY, FOR EXAMPLE -- NOW, I DON'T WANT
18 TO SLICE MY OWN THROAT HERE, BUT LET'S ASSUME YOU SAY ON
19 FRAUD, EVEN IF IT WAS ONE ENTITY, THERE IS NOT
20 SUFFICIENT EVIDENCE OF FRAUD, OKAY? CLEARLY, THEN, YES,
21 YOU CAN ADDRESS THAT ISSUE WITHOUT GETTING INTO THE
22 QUESTION OF IS IT -- YOU KNOW, IS IT ALTER EGO OF
23 MR. GAGGERO OR NOT?
24 YOU CAN JUST SAY, I CAN JUST PUT THAT ASIDE AND
25 SAY, LOOKING AT THE EVIDENCE, THERE'S NOT ENOUGH THERE.
26 MAYBE IN CERTAIN AREAS, YES. BUT I THINK WHEN DECIDING
27 THIS, YOU SORT OF HAVE TO SAY, WHAT APPROACH ARE YOU
28 TAKING? EITHER YOU WERE ASSUMING HYPOTHETICALLY IT IS

42
1 ONE ENTITY OR NOT.
2 THE COURT: ALL RIGHT. THEN LET'S KEEP GOING THE
3 WAY WE'RE GOING. THE BRIEF IS DUE ON FEBRUARY 10. WHEN
4 WAS THE RESPONSIVE BRIEFING?
5 MR. BEECHEN: THE 29TH, YOUR HONOR.
6 THE COURT: THE 29TH?
7 MR. BEECHEN: I THINK IT WAS THE 29TH. IT WAS
8 THE END OF FEBRUARY, I KNOW.
9 THE COURT: AND -- OKAY. ALL RIGHT. WHAT ARE
10 THE OTHER ISSUES?
11 MR. BEECHEN: ANOTHER ISSUE, YOUR HONOR, IS
12 MR. PRASKE'S DECLARATION. I DON'T KNOW IF YOU'VE SEEN
13 THAT. LET ME HAND IT TO YOUR CLERK.
14 YOUR HONOR MAY RECALL WHEN WE GOT INTO THE ISSUE
15 OF THE NOTICE TO APPEAR AND PRODUCE, YOU REQUESTED THAT
16 MR. PRASKE SUBMIT A DECLARATION SETTING FORTH THOSE
17 DOCUMENTS HE DID OR DID NOT HAVE. AND, IN RESPONSE, WE
18 RECEIVED THIS DECLARATION, WHICH HAS JUST BEEN PROVIDED
19 TO YOU. I FOUND THE DECLARATION TO BE DEFICIENT, AND I
20 WROTE TO MR. ANDREWS, COUNSEL FOR -- WHO SUBMITTED THE
21 DECLARATION, AND OBJECTED. AND WE'VE HAD SOME
22 CORRESPONDENCE BACK AND FORTH AND BASICALLY NO MOVEMENT
23 IN TERMS OF A FURTHER DECLARATION.
24 MY PRIMARY OBJECTION, YOUR HONOR, IN CONNECTION
25 WITH THIS DECLARATION -- AND I WOULD ASK THAT EITHER A
26 NEW DECLARATION BE ORDERED TO BE PRODUCED OR PRESENTED
27 OR THAT UNDER SECTION -- EVIDENCE CODE SECTION 413 THAT
28 IT BE DEEMED THAT THERE ARE NO RESPONSIVE DOCUMENTS.

43
1 AND, SPECIFICALLY, WHAT OCCURS IN THIS DECLARATION IS
2 MR. PRASKE STATES, IN ESSENCE, IN RESPONSE TO MANY OF
3 THEM, "OTHER THAN WHAT HAS BEEN TURNED OVER, I HAVE NO
4 OTHER DOCUMENTS."
5 I DON'T CONSIDER THAT -- A CLASSIC EXAMPLE OF
6 THAT IS, FOR EXAMPLE, RESPONSE TO REQUEST NUMBER 17,
7 WHICH IS FOUND AT PARAGRAPH NUMBER 7. NOW, REQUEST
8 NUMBER 17, 18, AND 19 ARE THOSE THAT ASK FOR THE
9 PRODUCTION OF ANY COMMUNICATIONS FROM BUNGE TO THE
10 DEFENDANTS DURING THE PERIOD OF OCTOBER 30 AND DECEMBER
11 OF 2007. AND THE IMPORTANCE OF THIS IS, OF COURSE,
12 MR. GAGGERO TESTIFIED, "I CHANGED THE DEAL BECAUSE BUNGE
13 WANTED A CHANGE." AND MR. GAGGERO TESTIFIED THAT THAT
14 WAS COMMUNICATED TO HIM IN WRITING. OUR POSITION IS
15 THERE WAS NO SUCH COMMUNICATION, NO REQUEST WHATSOEVER
16 FOR A CHANGE. SO THESE THREE REQUESTS DEAL WITH THAT
17 ISSUE.
18 SO WHAT WE GET IN RESPONSE IS THAT I JUST TURNED
19 OVER EVERYTHING AND I DON'T HAVE ANYTHING ADDITIONAL.
20 IT IS, IN ESSENCE, NONRESPONSIVE TO THE REQUEST.
21 THE COURT: LET ME ASK, WAS -- WERE ALL THE ITEMS
22 THAT WERE TURNED OVER IN DISCOVERY -- WERE THEY BATES
23 STAMPED?
24 MR. BEECHEN: YES. BY BOTH SIDES.
25 THE COURT: BY BOTH SIDES. INCLUDING ANYTHING
26 COMING FROM PRASKE?
27 MR. BEECHEN: YES, BECAUSE IT CAME THROUGH
28 COUNSEL.

44
1 MR. ANDREWS: YOUR HONOR, I WOULD LIKE TO DRAW
2 YOUR ATTENTION TO SOMETHING THAT CAME UP AFTER OUR LAST
3 HEARING, WHICH FOCUSED ON THE SUFFICIENCY OF MY
4 OBJECTION. AND THAT IS THOSE REQUESTS ARE IMPROPER AS A
5 MATTER OF LAW UNDER THE EXPRESS TERMS OF CODE OF CIVIL
6 PROCEDURE 1987(C).
7 THERE'S A MANDATORY REQUIREMENT IN THE STATUTE
8 THAT SAYS,
9 "THE NOTICE SHALL STATE THE EXACT
MATERIALS OR THINGS DESIRED AND THAT THE
10 PARTY OR PERSON HAS THEM IN HIS OR HER
POSSESSION OR UNDER HER CONTROL."
11
12 YOU'RE NOT ALLOWED TO USE IT AS A DISCOVERY
13 DEVICE TO SAY, "PRODUCE ALL DOCUMENTS." YOU HAVE TO
14 STATE THE EXACT DOCUMENT. AND THAT -- IF YOU COMPARE
15 THAT WITH THE DISCOVERY ACT 2031.030, IT SAYS YOU'RE
16 ALLOWED TO ASK FOR CATEGORIES. THIS LANGUAGE VERY
17 CLEARLY DOES NOT ALLOW YOU TO ASK FOR CATEGORIES OF
18 DOCUMENTS. AND IT'S A MANDATORY REQUIREMENT. THE WORD
19 "SHALL" IS THERE. IT SAYS,
20 "YOU SHALL STATE IN THE NOTICE
THAT THEY ARE UNDER THE RESPONDING
21 PARTY'S POSSESSION OR CONTROL."
22 SO AS I SET FORTH IN A BRIEF THAT I FILED
23 YESTERDAY --
24 THE COURT: BUT ISN'T THAT QUITE A BIT AFTER THE
25 REQUIRED OBJECTION PERIOD FOR THIS?
26 MR. ANDREWS: WELL, I THINK IT'S VOID AB INITIO
27 IF IT DOES NOT COMPLY WITH THE MANDATORY REQUIREMENTS OF
28 THE STATUTE. IT'S NOT A VALID NOTICE.

45
1 THE COURT: ONLY IF IT IS OBJECTED TO. I DON'T
2 THINK THAT YOU OBJECTED TO IT ON TIME.
3 MR. ANDREWS: WHAT I'M ARGUING IS THAT I DON'T
4 BELIEVE WE HAVE TO OBJECT IF IT'S NOT A VALID REQUEST.
5 HE COULD ASK FOR THE MOON --
6 THE COURT: ISN'T THAT A CIRCULAR ARGUMENT,
7 THOUGH, BECAUSE -- WELL, IT'S A CIRCULAR ARGUMENT, ISN'T
8 IT?
9 MR. ANDREWS: WHAT IF HE SAID PRODUCE SOMEBODY
10 WHO IS FROM OUT OF STATE, AND WE DIDN'T BRING THEM IN?
11 THE COURT: BUT HE DIDN'T.
12 MR. ANDREWS: I'M JUST SAYING, HYPOTHETICALLY --
13 WELL, I THINK THAT IF YOU'RE STRICTLY CONSTRUING THE
14 STATUTE AGAINST US, THAT IT SHOULD BE STRICTLY CONSTRUED
15 AGAINST THEM AND THAT THEIR NOTICE SHOULD BE DEEMED
16 INVALID.
17 THE COURT: BUT IT'S ONLY INVALID IF THERE'S AN
18 OBJECTION.
19 MR. ANDREWS: WELL, I RESPECTFULLY DISAGREE. AND
20 I WOULD ALSO STATE THAT I THINK THE ISSUES THAT HE'S
21 RAISING ARE GOING TO BE ADDRESSED IN OUR UPCOMING
22 BRIEFING. SO I DON'T KNOW THAT WE NEED TO PROVIDE
23 ANOTHER DECLARATION AT THIS POINT. THE ISSUES ARE ALL
24 SUBSUMED IN THAT.
25 THE COURT: ALTHOUGH, THERE'S AN EASY ANSWER TO
26 THE DECLARATION, IT APPEARS TO ME. JUST INSTEAD OF
27 SAYING, "I PRODUCED EVERYTHING," "I PRODUCED EVERYTHING
28 UNDER THE BATES STAMPS 522 TO 527." AND THAT'S IT.

46
1 THAT DESIGNATES SPECIFICALLY WHAT THOSE ITEMS ARE.
2 DOESN'T IT?
3 MR. ANDREWS: WELL, MR. PRASKE WAS NOT INVOLVED
4 IN THE CHAIN OF CORRESPONDENCE THAT THEY ARE ASKING FOR;
5 SO HE DOES NOT HAVE THOSE DOCUMENTS THAT THEY'RE
6 SEEKING, WHICH IS CORRESPONDENCE INVOLVING MR. BUNGE,
7 WHICH THEY HAVE.
8 THE COURT: BUT THAT'S NOT WHAT HE'S SAYING.
9 MR. BEECHEN: SEE, IF HE HAD SAID THAT, YOUR
10 HONOR, "I HAVE NO RESPONSIVE DOCUMENTS," THAT WOULD BE
11 FINE. THAT WOULD BE FINE. THAT'S NOT WHAT HE SAYS.
12 THE COURT: THE RESPONSE ASSUMES THAT HE HAS SOME
13 DOCUMENTS THAT HE PROVIDED.
14 MR. ANDREWS: I THINK HE'S JUST MAKING A GENERAL
15 STATEMENT THAT WHATEVER I HAVE I TURNED OVER.
16 THE COURT: BUT WE'VE GOT TO ARGUE IT THEN. IT'S
17 UNCLEAR.
18 ALL RIGHT. SO WHAT IS THE PLAINTIFF'S RESPONSE
19 TO THE OBJECTIONS ON THE MOTION TO QUASH?
20 MR. BEECHEN: I THINK THAT THE REQUESTS ARE
21 SUFFICIENTLY SPECIFIC TO IDENTIFY THE DOCUMENTS THAT ARE
22 BEING SOUGHT, IF ANY EXIST. THAT THIS IS A SITUATION,
23 YOUR HONOR, IN WHICH WE DON'T THINK A DOCUMENT EXISTS.
24 IN OTHER WORDS, IF YOU LOOK, FOR EXAMPLE, AT REQUEST
25 NUMBER 17, 18, AND 19 -- DO YOU HAVE THOSE IN FRONT OF
26 YOU?
27 THE COURT: I HAVE HIS RESPONSES. I DON'T HAVE
28 THE --

47
1 MR. BEECHEN: HERE. IF I MIGHT.
2 THE COURT: GO AHEAD. WHY DON'T YOU JUST --
3 MR. BEECHEN: I HAVE ALMOST MEMORIZED THEM BY
4 NOW.
5 SO, YOUR HONOR, HERE'S THE SITUATION, WHICH IN
6 17, 18, AND 19, WE DON'T BELIEVE THERE IS A RESPONSIVE
7 DOCUMENT. SO WHAT WE'RE TRYING TO DO IS ELIMINATE THAT
8 OR AT LEAST PROVE TO YOUR HONOR THERE IS NO RESPONSIVE
9 DOCUMENT TO THOSE THREE REQUESTS.
10 THE COURT: BUT, YOU KNOW, IN THIS REGARD,
11 THAT'S, AGAIN, AN EASY ISSUE. IF ONE SIDE SAYS THERE IS
12 NO SUCH DOCUMENT AND THE OTHER SIDE GETS UP BUT DOESN'T
13 PRODUCE IT, THEN I ASSUME THERE IS NO DOCUMENT
14 REGARDLESS OF WHAT IS SAID ON THE STAND.
15 MR. ANDREWS: THAT'S FAIR. BECAUSE AS THE
16 TESTIMONY SHOWED, MR. BUNGE DID NOT USE E-MAIL. HE USED
17 THE TELEPHONE, SO --
18 THE COURT: OR WROTE LETTERS.
19 MR. ANDREWS: LATER ON HE DID.
20 THE COURT: WELL, HE WROTE LETTERS. I MEAN,
21 IT'S --
22 MR. BEECHEN: YOUR HONOR --
23 THE COURT: BUT THAT DOESN'T --
24 MR. BEECHEN: I'M NOT GOING TO BELABOR THIS, YOUR
25 HONOR. YOU GET THE IDEA, AND YOU'RE CORRECT. THAT IF
26 IT'S NOT IN EVIDENCE, THAT'S SORT OF THE END OF THE
27 INQUIRY IN TERMS OF THAT PARTICULAR PIECE OF PAPER.
28 THE COURT: CORRECT. THAT'S WHAT IT SEEMS.

48
1 MR. BEECHEN: OKAY.
2 THE COURT: LET ME RETURN THIS.
3 MR. BEECHEN: AND I GUESS WE'RE JUST, THEN,
4 WAITING TO FINISH UP. AND THEN WHAT WE HAVE DECIDED,
5 YOUR HONOR, IS THAT WE ARE GOING -- BECAUSE WE DO NOT
6 AGREE ON THE CLOSING ARGUMENTS, AND PURSUANT TO YOUR
7 COMMENTS, WE'LL DO ORAL ARGUMENTS --
8 THE COURT: OKAY.
9 MR. BEECHEN: -- TO YOUR HONOR.
10 THE COURT: THEN I NEED -- WHAT IS THE LAST DAY
11 THAT THE BRIEFING IS SET FOR?
12 MR. BLECHER: FEBRUARY 29.
13 THE COURT: THERE'S A REPLY.
14 THE CLERK: REPLY BRIEF SHOULD BE SUBMITTED BY
15 FEBRUARY 29. THAT WAS FOR PRASKE'S BRIEF. THE WITNESS
16 SHALL PROVIDE SAID BRIEF BY FEBRUARY 10.
17 MR. ANDREWS: I THOUGHT THERE WAS A REPLY FROM
18 PRASKE BUILT INTO THE SCHEDULE.
19 THE CLERK: PULL THE REPORTER'S TRANSCRIPT.
20 THE COURT: LET'S ASSUME THAT THE 29TH IS THE
21 LAST DAY ON THAT. THE COURT WILL SET ORAL ARGUMENT THAT
22 IT'S RULING ON THIS. CAN WE DO THAT AT THE END OF THE
23 WEEK OF THE 12TH OF MARCH? WE'RE DARK FROM FEBRUARY
24 27TH THROUGH --
25 MR. BLECHER: UNFORTUNATELY, I'M STARTING THE
26 TRIAL WITH JUDGE ANDERLE IN SANTA BARBARA ON THE 21ST
27 THAT HE'S ALLOCATED FOUR WEEKS, A JURY TRIAL. WE ARE
28 DARK ON THE 2ND OF MARCH, A DATE I COULD DO. BUT IF WE

49
1 GO -- IF WE DON'T TAKE THAT DARK DAY, THEN I WOULD HAVE
2 TO REQUEST WE PUT IT OFF UNTIL --
3 THE COURT: AS YOU SEE, WE'RE DARK FOR TWO WEEKS.
4 MR. BLECHER: OH, THERE YOU GO.
5 THE COURT: UNLESS YOU'RE GOING TO PAY MY AIRFARE
6 TO FLY BACK FROM WHERE I'M GOING, I'M NOT GOING TO BE
7 HERE ON MARCH 2ND.
8 MR. BLECHER: HE'S SCHEDULED A WAYS, HE'S
9 INFORMED US, THROUGH MARCH 23. BUT I FEAR IF WE SET IT
10 IN THAT NEXT WEEK, THAT IF WE RUN OVER, WE HAVE A
11 PROBLEM. SO I WAS GOING -- WE COULD DO THAT, OR WE
12 COULD DO APRIL 6TH, WHICH WOULD BE A CERTAIN DATE.
13 THE COURT: I'LL DO EITHER ONE. I CAN EITHER SET
14 IT FOR THE 26TH OF MARCH, AND WE JUST GO DAY TO DAY
15 UNTIL EVERYBODY IS HERE, OR I'LL SET IT FOR APRIL 6TH.
16 I'M OKAY DOING IT EITHER WAY.
17 MR. BEECHEN: I WOULD PREFER MARCH 26. I'D LIKE
18 TO -- WHILE IT'S NOT GOING TO BE QUITE AS FRESH, THE
19 SOONER THE BETTER.
20 MR. BLECHER: CAN I CATCH MY BREATH AND ASK TO DO
21 THE 27TH?
22 THE COURT: ACTUALLY, I WAS GOING TO SUGGEST THE
23 27TH. OUR CALENDAR IS BETTER ON THE 27TH. I'LL JUST
24 PUT IT ON THE 27TH.
25 MR. BEECHEN: THAT'S FINE.
26 MR. BLECHER: DOES MR. BEECHEN'S DECISION TO DO
27 ORAL ARGUMENT PRECLUDE US FROM FILING A BRIEF?
28 THE COURT: YES. THAT'S THE SHORT ANSWER. IF

50
1 THE COURT NEEDS BRIEFING ON A PARTICULAR AREA, I'LL ASK
2 FOR IT. IF YOU WANT TO PROPOSE BRIEFING ON A PARTICULAR
3 AREA, I'LL TAKE A LOOK AT IT. BUT A GENERALIZED BRIEF
4 I'M NOT GOING TO ACCEPT GIVEN THE ORAL ARGUMENT. BUT IF
5 THERE'S A PARTICULAR ISSUE OF LAW THAT YOU WISH TO
6 BRIEF, BOTH SIDES AGREE TO IT, I'LL ACCEPT THAT. I'M
7 NOT LOOKING FOR IT AT THIS POINT. BUT THE ANSWER IS NO
8 TO A GENERAL CLOSING BRIEF. I'M LEAVING IT OPEN FOR
9 SPECIFIC ISSUES THAT THE PARTIES REALLY FEEL THAT IS AN
10 ISSUE OF LAW THAT THEY WANT TO PROVIDE ME WITH.
11 MR. ANDREWS: CAN WE SUBMIT THOSE AND HAVE THE
12 OTHER SIDE RESPOND, OR DO WE HAVE TO AGREE IN ADVANCE?
13 THE COURT: WELL, FIRST, I WOULD LIKE AN
14 AGREEMENT. AND IF THERE'S NO AGREEMENT, I'D PREFER NOT
15 SIMPLY GETTING IT. IT MAY NOT BE SOMETHING THAT I THINK
16 IS AN ISSUE. AND SO WHY -- I WOULD NOT PERMIT THE
17 BRIEFING, THEN. IF THERE'S A PARTICULAR ISSUE THAT YOU
18 WANT, THEN I'LL HEAR ARGUMENTS ON -- WHAT WAS THAT DATE
19 THAT I GAVE YOU? MARCH 27. JUST TELL ME ON MARCH 27
20 WHAT IT IS THAT YOU CAN'T AGREE TO AND WHAT IT IS YOU
21 WANT TO DO. IF BOTH SIDES AGREE TO A WRITTEN BRIEF,
22 THEN EVERYTHING COMES IN.
23 MR. BEECHEN: YEAH.
24 THE COURT: BUT IF NOT, THEN NOTHING COMES IN
25 WITHOUT COURT PERMISSION OR COURT REQUEST. BUT THAT
26 BRIEFING MAY ONLY BE -- SO YOU DON'T WASTE YOUR TIME
27 ARGUING ABOUT IT FOR A STIPULATION -- IT MAY ONLY BE AS
28 TO ISSUES OF LAW. I'M NOT GOING TO LOOK FOR A BRIEF AS

51
1 TO CONTESTED ISSUES OF FACT. I CAN GO TO THE TRANSCRIPT
2 FOR THAT. SO THOSE ARE THE GROUND RULES, SO TO SPEAK.
3 MR. BEECHEN: WHAT TIME ON THE 27TH, YOUR HONOR?
4 THE COURT: LET'S SET IT FOR 9:30. IS THAT OKAY?
5 HOW LONG DO THE PARTIES EXPECT? JUST GIVE ME A BALLPARK
6 FIGURE. MY CONCERN IS NOT SO MUCH THIS ARGUMENT AS
7 OPPOSED TO IF I'M IN JURY TRIAL, I NEED TO HAVE THE JURY
8 COME BACK AT A CERTAIN TIME. AND I NEED TO HAVE SOME
9 IDEA OF HOW LONG YOU'RE GOING TO GO. I ASSUME IT WILL
10 BE DONE IN LESS THAN A DAY.
11 MR. BEECHEN: OH, YES. I WOULD ESTIMATE HOUR,
12 HOUR AND A HALF FROM OUR SIDE. WITH THE REPLY, OF
13 COURSE.
14 MR. BLECHER: SOUNDS REASONABLE.
15 THE COURT: ALL RIGHT. SO I'LL SET ASIDE THREE
16 HOURS, THEN? OKAY.
17 MR. BEECHEN: I'LL TRY AND KEEP IT SHORT. I KNOW
18 YOU'RE -- WELL, OBVIOUSLY, YOU'VE BEEN SITTING HERE AND
19 BEEN LIVING WITH THIS CASE FOR YEARS.
20 THE COURT: YEAH. BUT YOU KNOW WHAT YOU NEED TO
21 ARGUE, AND ONCE YOU GET DOWN TO ACTUALLY --
22 MR. BEECHEN: I'VE ALWAYS BEEN TEMPTED TO TAKE
23 THAT PAUL NEWMAN ARGUMENT IN WHICH HE SAYS TO THE JURY,
24 "YOU KNOW WHAT YOU NEED TO DO." AND HE SITS DOWN, AND
25 THEN THEY AWARD HIM MILLIONS OF DOLLARS. BUT I NEVER
26 GET THAT COMFORTABLE.
27 THE COURT: I LOVE THOSE ARGUMENTS.
28 MR. BEECHEN: OKAY. YOU KNOW WHAT TO DO, YOUR

52
1 HONOR. THANK YOU VERY MUCH.
2 THE COURT: ALL RIGHT. SO THEN WE'LL SET THE
3 MATTER FOR ORAL ARGUMENT 9:30, MARCH 27. COURT WILL SET
4 ASIDE THREE HOURS. I'D APPRECIATE --
5 MR. BLECHER: IF I'M STUCK, I CAN LET YOU KNOW.
6 THE COURT: ABSOLUTELY. BEING IN JURY TRIAL IS
7 GOOD CAUSE, BECAUSE -- IF I HAD INSISTED THAT WE GO
8 WITHOUT A BREAK, THAT WOULD BE DIFFERENT. THEN YOU
9 WOULD BE ENGAGED. BUT, CLEARLY, I'M NOT GOING TO PLAY
10 GAMES WITH THAT.
11 MR. BLECHER: THANK YOU, YOUR HONOR. I
12 APPRECIATE THAT.
13 THE COURT: BUT I WOULD EXPECT THAT YOU WOULD
14 CALL THE OPPOSING SIDE, LET THEM KNOW, AND THEN THE
15 PARTIES CAN GET TOGETHER ON THE PHONE WITH THE COURT,
16 AND WE'LL JUST EITHER TRAIL DAY TO DAY OR SELECT ANOTHER
17 DAY, WHICHEVER WORKS OUT BETTER. ALL RIGHT?
18 MR. BEECHEN: THANK YOU, YOUR HONOR.
19 MR. ANDREWS: THANK YOU, YOUR HONOR.
20 THE COURT: THANK YOU. GOOD LUCK.
21 MR. BLECHER: THANK YOU FOR ALL YOUR COURTESIES.
22 THE COURT: THANK YOU. I APPRECIATE THE WAY THIS
23 HAS BEEN GOING. THIS IS DONE VERY WELL ON BOTH SIDES.
24 THANK YOU.
25 MR. BLECHER: THANK YOU.
26 MR. BEECHEN: THANK YOU.
27
28 (PROCEEDINGS CONCLUDED AT 11:43 A.M.)

1 SUPERIOR COURT OF THE STATE OF CALIFORNIA
2 FOR THE COUNTY OF LOS ANGELES
3 DEPARTMENT WE B HON. NORMAN P. TARLE, JUDGE
4 JOSE BUNGE; VICTORIA BUNGE, )
)
5 PLAINTIFF(S), )
)
6 V. ) NO. SC100361
)
7 511 OFW, LP., A CALIFORNIA )
LIMITED PARTNERSHIP; )
8 GINGERBREAD COURT, L.P., A )
CALIFORNIA LIMITED PARTNERSHIP;)
9 BOARDWALK SUNSET, LLC, A )
CALIFORNIA LIMITED LIABILITY )
10 COMPANY; STEVE GAGGERO; AND )
DOES 1-50; INCLUSIVE, )
11 )
DEFENDANT(S). )
12 _______________________________)
13
I, KAREN B. YODER, OFFICIAL REPORTER OF THE
14
SUPERIOR COURT OF THE STATE OF CALIFORNIA, FOR THE
15
COUNTY OF LOS ANGELES, DO HEREBY CERTIFY THAT THE
16
FOREGOING PAGES, 1 THRU 52, COMPRISE A FULL, TRUE, AND
17
CORRECT TRANSCRIPT OF THE PROCEEDINGS HELD IN THE
18
ABOVE-ENTITLED MATTER ON FEBRUARY 7, 2012.
19
20
21
22
23
DATED THIS _______DAY OF __________, 2012.
24
25
26
_____________________________
27 OFFICIAL REPORTER, CSR #8123
28

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