Filed 8/28/26 Long Venture Partners v. Waldron CA6
NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SIXTH APPELLATE DISTRICT
H053591
LONG VENTURE PARTNERS L.P., (Santa Clara County Super. Ct. No. 21CV384329)
Plaintiff and Appellant,
v.
JUSTIN WALDRON et al.,
Defendants and Respondents.
In 2016, Long Venture Partners L.P. (LVP) invested in a technology start-up, which eventually became known as Playco Global Inc. (Playco). In August 2020, Playco’s president and co-founder Justin Waldron represented that the company had no “plans to fundraise right now,” and LVP agreed to sell its Playco shares back to the company. However, only three weeks after the agreement to do so was signed, Playco announced a $100 million fundraising round. Claiming that Waldron’s representation about Playco’s plans was false and that the company concealed material information about those plans, LVP sued Playco and Waldron for fraud.
After conducting discovery, Playco and Waldron moved for summary judgment, and the trial court granted the motion. LVP has appealed, arguing that the trial
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improperly excluded a key e-mail and that, even absent the e-mail, there are triable issues concerning false representation and concealment.
As explained below, we conclude that the trial court erred in granting summary judgment. Although the trial court did not abuse its discretion in excluding the e-mail in question, the remaining evidence raised triable issues. While the trial court interpreted Waldron’s representation that Playco had no “plans to fundraise” narrowly to mean that the company had no “actual,” “definite,” or “finalized” fundraising plan, this representation could be interpreted more broadly to mean that Playco had no specific fundraising goal, and LVP presented sufficient evidence to raise a triable issue concerning the truthfulness of that representation and, even more clearly, whether Playco concealed its plans before the agreement to repurchase LVP’s shares was executed. However, LVP has not challenged the trial court’s ruling that it failed to present the clear and convincing evidence of fraud required for punitive damages.
Accordingly, we reverse the judgment and remand with instructions to deny defendants’ summary judgment motion and summary adjudication of LVP’s claims, but to grant summary adjudication of LVP’s request for punitive damages.
I. BACKGROUND
Because this appeal is from a judgment after the grant of summary judgment, in recounting the facts, we view the evidence in the record in the light most favorable to LVP, the party opposing summary judgment. (See, e.g., Conroy v. Regents of University of California (2009) 45 Cal.4th 1244, 1249-1250 (Conroy).)
A. LVP’s Investment in Playco Playco makes web games and a web browser engine that allows instant gaming without downloads or installed applications. In 2016, LVP, a venture capital firm founded and managed by Sam Yu, invested $2 million in Game Closure, Inc., later renamed Playco, in exchange for nearly 600,000 shares of preferred stock.
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B. The SAFE Fundraising Round On February 2, 2020, Michael Carter, Playco’s chief executive officer and co-
founder, wrote Waldron, the company’s president and another co-founder, that investors were excited about the company and interested in making additional investments. (Unless expressly indicated otherwise, subsequent dates are in 2020.) Indeed, Carter suggested that Playco might be able to raise $20-30 million.
On February 28, using a “SAFE” agreement, which gave the investor the right to preferred stock in case of an equity financing, Playco secured a $10 million investment. Over the next month, Carter secured over $7.5 million in additional investments, and by July, Playco had raised over $45 million. At that point, Michael Piech, Playco’s executive vice president of operations, informed a potential investor that the company was “getting ready to close out our previous fundraise.”
C. The Waldron Representation In May, while the SAFE fundraising round was proceeding, Carter approached Yu and offered to redeem LVP’s shares, but Yu was not interested at the price offered. In August, after the SAFE fundraising round, Carter approached Yu again and introduced him to Waldron. Yu asked Waldron for information concerning the company’s current structure and fundraising plans, as well as business and financial information. With respect to fundraising, Yu asked “whether the company is engaging in any discussion of fundraising, a change of control or acquisition by any potential buyer, or anticipates to have such discussion in the near future.”
On August 15, Waldron responded with the representation at the center of this case. He told Yu that Playco was talking to investors but had no “plans to fundraise right now”: “Of course we are always talking to investors, but we don’t have plans to fundraise right now. We’ve just raised money, and we have enough for our current plans.
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We aren’t in any discussions with a potential buyer and we don’t plan to seek any in the near future.”
Over the next ten days, Yu and Waldron negotiated the repurchase of LVP’s shares.
In the course of these negotiations, Waldron informed Yu that Playco had raised approximately $47 million using SAFE agreements. Although Yu thought such agreements too risky, Waldron offered to pay $3.5 million in cash along with a $500,000 SAFE. This offer was acceptable to LVP, and on August 25, LVP and Playco agreed that Playco would redeem LVP’s shares. On August 31, after exchanging draft agreements for several days, the parties signed a written contract, the Stock Repurchase Agreement, effective as of August 30, 2020. On September 4, Playco wired $3.5 million in cash to LVP.
D. The September Fundraising Round On August 25, the day it reached the agreement with LVP, Playco had a conference call with investors. The following day, one of those investors, Josh Buckley, sent Carter a document entitled “Playco Investment Memo (August 2020).” In addition, on August 31, the day that LVP signed the Stock Repurchase Agreement, Carter e-mailed Raymond Tonsing, a potential investor, that “we may do a quick inside round.”
The fundraising round was indeed quick. On September 12, Carter e-mailed Buckley a draft term sheet, and on September 21, Playco issued a press release stating it had closed on a $100 million fundraising round involving Buckley, Tonsing’s Caffeinated Capital, and at least seven other investors. In October, pursuant to a side letter agreement, Playco paid LVP $500,000 to refund LVP’s SAFE.
E. The Proceedings Below LVP sued Playco and Waldron in June 2021. In the operative pleading, the second amended complaint, LVP asserted claims for (1) fraud under the common law and Civil Code section 1572; (2) investment fraud under Corporations Code section 25401 and
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purchasing securities without a broker-dealer license in violation of Corporations Code section 25501.5; and (3) declaratory relief. LVP also requested punitive damages on its first two claims.
LVP alleged that it agreed to sell its shares back to Playco in reliance on Waldron’s August 15 representation that Playco had no fundraising plans at that time, which LVP alleged was false. Alternatively, LVP alleged that, to the extent fundraising plans arose after August 15 but before the Stock Repurchase Agreement was signed on August 31, Playco improperly concealed those plans.
After discovery, defendants Playco and Waldron moved for summary judgment.
They argued, among other things, that LVP could not establish that Playco made any false representations about its fundraising plans. In support of this argument, defendants submitted a declaration from Playco chief executive officer Carter stating that “[a]s of August 30, 2020, Playco did not have any plans to fundraise,” that the possibility of a new round of fundraising was raised for the first time by Buckley on August 25, and that on August 31, when the Stock Repurchase Agreement was signed, “Playco had not yet decided whether to pursue a financing round.”
LVP responded that there were triable issues concerning both false representation and concealment. In particular, LVP contended that Carter and Waldron had been “planning a fundraising round” since February and that this “goal of fundraising” was realized in November. LVP also pointed to a July 28 e-mail in which Piech told an investor that the company “had begun ‘to enter discussion on a new round at a higher [valuation].’ ” LVP argued as well that Buckley’s August 25 investment memo and Carter’s August 31 statement that “ ‘we may do a quick inside round’ ” showed that in August Playco was planning further fundraising. Finally, LVP argued that Playco concealed material information about its plans for a fundraising round and about Playco’s
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performance, instead giving LVP information that misleadingly suggested lackluster growth.
The trial court granted summary judgment as well as summary adjudication on all of LVP’s claims and its punitive damages request. Agreeing with an objection raised by defendants in their reply brief, the trial court held that Piech’s July 28 e-mail was inadmissible because LVP had failed to authenticate it. The court also ruled that, even with the e-mail, LVP had not raised a triable issue because the e-mail did not show any discussions before Waldron’s August 15 representation that resulted in “actual plans” for fundraising. Similarly, even though Carter said in his August 31 e-mail that Playco might do a “quick inside round,” the trial court held that the e-mail did not raise a triable issue because it did not show “definitive plans” for fundraising. LVP, the court concluded, had not produced any evidence that raised any triable issue concerning when Playco’s fundraising plans became “finalized.”
The trial court also rejected LVP’s claim that Playco concealed material performance information because LVP had not asserted concealment of this information in its pleadings. Accordingly, the court held that LVP’s common law fraud claim failed as a matter of law and defendants were entitled to summary adjudication on that claim.
The trial court also granted summary adjudication on LVP’s remaining claims. It granted summary adjudication of LVP’s investment fraud claim under Corporations Code section 25401 because that claim was based on the same facts as the common law fraud claim and therefore failed for the same reasons as that claim. The trial court also rejected the claim under Corporations Code section 25501.5 that Playco improperly purchased LVP’s shares without a broker-dealer license, reasoning that Playco was the issuer of the original shares and therefore exempt from the licensing requirement. In addition, because LVP had not established either of its fraud claims, the trial court ruled that LVP’s related claim for declaratory relief failed.
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Finally, the trial court grant summary adjudication on LVP’s request for punitive damages. Here again, the court relied on its determination that there was no triable issue concerning fraud. The court also added a second reason: It ruled that the evidence of fraud presented by LVP was “ ‘not “clear and convincing,” as required by Civil Code section 3298, subdivision (c).’ ”
Accordingly, the trial court granted Playco’s summary judgment motion in its entirety, and on June 20, 2025, it entered final judgment in favor of Playco and Waldron. LVP filed a notice of appeal that same day.
II. DISCUSSION
LVP contends that the July 28 Piech e-mail was improperly excluded and that it raised triable issues concerning its fraud and declaratory relief claims as well as its punitive damages request. As explained below, although we conclude that the trial court properly excluded the July 28 Piech e-mail, we agree that LVP raised triable issues concerning its fraud and declaratory relief claims. However, we conclude that LVP did not raise a triable issue concerning punitive damages.
A. The July 28 Piech E-mail In opposing summary judgment, LVP submitted a declaration from its general manager Sam Yu, which included a document purporting to be a July 28 e-mail from Playco’s vice president of operations Michael Piech to an investor. This document states that Playco was “beginning to enter discussions on a new round” of fundraising: “The SAFE represents our current round (with Sequoia, etc.), but we’re beginning to enter discussions on a new round at a higher markup which is why we’re hoping to wrap things up on this round.” Playco objected that the July 28 Piech e-mail was “unauthenticated and inadmissible.” The trial court agreed. Following the “weight of authority,” we review the trial court’s ruling for abuse of discretion. (Serri v. Santa Clara University (2014) 226 Cal.App.4th 830, 852 (Serri).) We find no abuse.
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“Authentication of a writing means (a) the introduction of evidence sufficient to sustain a finding that it is the writing that the proponent of the evidence claims it is or (b) the establishment of such facts by any other means provided by law.” (Evid. Code, § 1400.) The party submitting a document bears the burden of authenticating it, and a document is admissible only if there is sufficient evidence to establish authenticity. (Id., § 403, subd. (a) & (a)(3).) A document’s authenticity may be proven by any means, including circumstantial evidence or the document’s own contents. (Ramos v. Westlake Services LLC (2015) 242 Cal.App.4th 674, 684; see also Evid. Code, § 1410 [“Nothing in this article shall be construed to limit the means by which a writing may be authenticated or proved.”].)
Here, LVP failed to present any evidence that the July 28 Piech e-mail was in fact e-mailed by Piech on that date. As the trial court noted, Yu was neither the author nor the recipient of the e-mail and therefore could not authenticate it based on personal knowledge. LVP also did not use any of the means typically employed to authenticate such documents. For example, LVP did not submit a request for admission concerning the document’s authenticity. (Serri, supra, 226 Cal.App.4th at p. 855.) In addition, even though the document appears to have been marked as an exhibit from Piech’s deposition, LVP did not submit testimony from that deposition about the e-mail. (Ibid.) Nor was the document used—and, thus, implicitly authenticated by—Playco. (Ibid.; see Ambriz v. Kelegian (2007) 146 Cal.App.4th 1519, 1526-1529.) Finally, while Yu’s declaration stated that all the documents attached to it were “produced documents,” LVP failed to identify the request in response to which the document was produced. As a consequence, the trial court reasonably concluded that LVP failed to authenticate the July 28 Piech e- mail.
LVP asserts that the e-mail authenticated itself because it has production numbers, PLAYCO 006192-6193, on the bottom right corners of each page. While these numbers
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suggest that the document was produced in discovery, that fact alone does not authenticate that it is an e-mail sent by Piech on July 28. As this court observed more than a decade ago, “[d]ocuments obtained in discovery in response to a request for production of documents . . . must be presented in admissible form,” which “means the evidence must be (1) properly identified and authenticated . . . .” (Serri, supra, 226 Cal.App.4th at p. 855, italics added).) Consequently, unless the genuineness of a document produced in discovery is admitted, “the proponent of the evidence must present declarations or other ‘evidence sufficient to sustain a finding that it is the writing that the proponent of the evidence claims it is.’ ” (Ibid.) As LVP notes, this is a low bar. (See People v. Goldsmith (2014) 59 Cal.4th 258, 267 [“[In essence,] what is necessary is a prima facie case.”].) However, LVP has not overcome it.
Consequently, we conclude that the trial court did not abuse its discretion in excluding the July 28 Piech e-mail for lack of authentication.
B. Summary Judgment We now turn to the trial court’s summary judgment ruling, which is reviewable de novo, applying the standards that govern a trial court’s evaluation of summary judgment motions. (See e.g., Hobbs v. City of Pacific Grove (2022) 85 Cal.App.5th 311, 321.)
1. The Applicable Standard Summary judgment is appropriate when “there is no triable issue as to any material fact and . . . the moving party is entitled to a judgment as a matter of law.” (Code Civ. Proc., § 437c, subd. (c).) A defendant moving for summary judgment bears the initial burden of showing that one or more elements of the plaintiff’s causes of action cannot be established or that there is a complete defense to them. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 849 (Aguilar).)
If this initial burden is satisfied, the burden shifts to the plaintiff to show a triable issue of material fact. (Aguilar, supra, 25 Cal.4th at pp. 849-850.) In determining
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whether there is a triable issue, courts must “ ‘consider[] all the evidence set forth in the moving and opposition papers except that to which objections were made and sustained’ ” (State Dept. of Health Services v. Superior Court (2003) 31 Cal.4th 1026, 1035), as well as any inferences reasonably drawn from that evidence (Aguilar, at p. 843). In addition, a court must view the evidence presented “in the light most favorable to the opposing party.” (Ibid.) Consequently, in reviewing the evidence presented by a plaintiff opposing summary judgment, we must “liberally constru[e] her evidentiary submission while strictly scrutinizing defendants’ own showing, and resolving any evidentiary doubts or ambiguities in plaintiff’s favor.” (Saelzler v. Advanced Group 400 (2001) 25 Cal.4th 763, 768.)
2. Common Law Fraud In the first count of the second amended complaint, LVP alleged fraud under the common law and Civil Code section 1572 based on false representation and concealment. (See, e.g., Lazar v. Superior Court (1996) 12 Cal.4th 631, 638 [“ ‘The elements of fraud . . . are (a) misrepresentation (false representation, concealment, or nondisclosure); (b) knowledge of falsity (or “scienter”); (c) intent to defraud, i.e., to induce reliance; (d) justifiable reliance; and (e) resulting damage.’ ”].) The trial court held that LVP failed to raise a triable issue concerning either false representation or concealment because there was no evidence that Playco had an “actual,” “definitive,” or “finalized” plan for fundraising when Waldron represented that Playco had no “plans to fundraise right now.” We disagree. Waldron represented that Playco had no fundraising “plans”—not that it had no “actual,” “definitive,” or “finalized” plans—and a reasonable jury could interpret “plans” broadly to mean specific fundraising goals. Moreover, even without the July 28 Piech e-mail, LVP presented sufficient evidence to create a triable issue that in August 2020, when Waldron made his representation, LVP had specific fundraising goals.
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a. The Meaning of Waldron’s Representation On August 15, Waldron represented to Yu that Playco was “always talking to investors, but we do not have plans to fundraise right now.” In its opening brief on appeal, LVP argues that there is a triable issue concerning whether, contrary to this representation, Playco had a “preliminary plan” for fundraising or was engaged in “planning” for such fundraising. Defendants respond that there is no triable issue because there was no evidence of “actual plans,” a “definite plan,” “definitive plans,” or a “formal plan.” Because the parties appear to be using the word “plan” in different senses, and thus speaking at cross-purposes, we requested supplement briefing on whether the word “plan” should be interpreted in a broad or narrow sense. Viewing the evidence in the light most favorable to LVP as the party opposing summary judgment, a reasonable jury could find that Waldron used the word “plan” in a broad sense.
Defendants assert that LVP has waived the question of how “plan” should be interpreted because in the trial court LVP acknowledged that its fraud claims turned on whether Playco had an “actual” or “definitive” plan, and on appeal LVP likewise argued that the evidence shows an actual plan. That is not true. Contrary to the suggestion in defendants’ supplemental letter, there is no mention in the second amended complaint of “actual” or “definitive” plans. Instead, LVP alleged that Waldron made an “intentional misrepresentation . . . that there was no new financing on the horizon.” (Italics added.) Moreover, LVP opposed summary judgment on the ground that, contrary to Waldron’s representation, Playco had a “goal of fundraising” on August 15, 2020, and “concealment is not about a definitive plan of financing.” Finally, in its opening brief on appeal, LVP argues that the parties “were not talking about ‘definitive’ plans for fundraising, but preliminary planning” and that “the issue here is whether Playco had any plan, definitive or not, for another round of fundraising.” (Italics added.)
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The broader interpretation implicitly urged by LVP is consistent with one meaning of the word “plan.” “Plan” may be used in the narrow, formal sense that defendants urge, and the trial court adopted, to mean “a detailed and systematic formulation of a largescale campaign or program of action.” (Webster’s 3d New Internat. Dict. (1993) p. 1729, col. 3; see also American Heritage Dict. (5th ed. 2011) p. 1347, col. 1 [defining “plan” to mean, among other things, “[a]n orderly or step-by-step conception or proposal for accomplishing an objective”].) However, “plan” also may be used in a broader, informal sense to mean “a proposed undertaking or goal,” such as a plan to lose weight or get more sleep. (Webster’s 3d New Internat. Dict., supra, p. 1729, col. 3; see also American Heritage Dict., supra, p. 1347, col. 1 [“[a] proposed or intended course of action”].)
Defendants assert that Waldron must have been using the word “plan” in a narrow, formal sense because he distinguished between “always talking to investors” and “plans to fundraise.” According to defendants, “talking to investors is a proposed undertaking toward the goal of raising money,” and therefore a “reasonable reader can give [Waldron’s representation] coherent meaning only by reading ‘plans’ as . . . a concrete, formulated program.” We are not convinced. Playco may have talked to investors in the hope that it would build good relationships with them and that those relationships might help in raising funds at some indefinite point in the future. However, “plans to fundraise” does not have to be interpreted to mean a “concrete, formulated program” in order to distinguish such talks from “plans to fundraise.” Instead, “plans to fundraise” may be distinguished from merely “talking to investors” by interpreting fundraising “plans” to mean specific fundraising goals, not vague hopes of fundraising help at some indefinite point in the future. Thus, the distinction implicitly drawn by Waldron between talking to investors and plans to fundraise does not definitively establish the narrow, formal interpretation urged by defendants.
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Defendants also assert that a narrow, formal interpretation is established by the question that Waldron sought to answer with his representation. Specifically, defendants assert that Waldron’s representation tracked the question posed by Yu because Waldron “confirmed the informal, continuous ‘always talking to investors’ (addressing the ‘discussion’ half of Mr. Yu’s question) and denied ‘plans to fundraise right now’ (addressing whether Playco anticipated moving beyond discussion to a more formal plan).” Here again, we are not convinced. Yu asked Waldron whether “the company was engaging in any discussion of fundraising” or “anticipates to have such discussion in the near future.” Thus, as defendants note, Yu asked whether the company was engaged in any “discussion” of fundraising. However, contrary to defendants’ assertion, Yu did not ask whether Playco “anticipated moving beyond discussion to a more formal plan.” Instead, Yu asked if the company “anticipates to have such discussion in the near future.” (Italics added.) There is no mention of formal plans and, thus, nothing in Yu’s question to Waldron compelling the narrow interpretation of “plans” urged by defendants.
However, there is evidence supporting the broad interpretation urged by LVP. As LVP points out, Section 4.5 of the Stock Repurchase Agreement states that Playco made reasonably available the information requested by LVP, “including without limitation the information regarding any . . . private financing transaction (whether debt or equity) . . . which have been, are being, or may be contemplated by the Company.” (Italics added.) As fundraising goals are accomplished through financing transactions, a jury reasonably could infer that this passage refers to Waldron’s representation that Playco had no “plans to fundraise.” And if that representation concerned transactions that “may be contemplated,” a jury also reasonably could infer that Waldron was talking about “plans to fundraise” in the broad sense of contemplated goals rather than the narrow sense of already formalized or finalized programs of action.
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In short, there is a triable issue whether Waldron used the word “plans” in the broad sense of goals, which a jury should decide.
b. Evidence of Falsity In addition, even without the July 28 Piech e-mail, there is another issue for a jury to decide: whether Waldron falsely represented that Playco had no specific fundraising goals in mid-August 2020.
LVP presented evidence that in August 2020 Playco was contemplating additional fundraising. First and foremost, on August 31, Carter e-mailed Raymond Tonsing of Caffeinated Capital, one of the venture capitalists who participated in Playco’s subsequent $100 million fundraising round. Carter told Tonsing that “we may do a quick inside round.” A jury reasonably could infer that Carter told this venture capitalist about doing a quick round because Playco intended to do another fundraising round shortly and it wanted Tonsing to participate. Moreover, because Carter described this round as “quick,” it is reasonable to infer that by that point preparations for the round were already under way. Far from suggesting otherwise, Playco acknowledges that the August 31 e-mail reflects that “Playco was considering . . . whether to pursue a financing round.”
Other evidence supports the inference that by August 31 Playco was contemplating additional fundraising and had been doing so for awhile. In particular, on August 26 a venture capitalist, Josh Buckley, sent Playco’s chief executive officer Michael Carter a draft memorandum concerning possible investment in the company. The memorandum contained detailed information concerning Playco’s revenues, costs, and operations, including how often Playco ships code per day and per week. This information—which LVP asked to file conditionally under seal—is apparently confidential, and therefore Buckley presumably obtained it from Playco. Moreover, a jury reasonably could infer that Playco disclosed this information in order to secure additional fundraising.
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In addition, the fundraising round was finalized quickly. On September 12, less than three weeks after receiving the draft memo from Buckley, Carter circulated a draft term sheet to Buckley, and nine days after that, on September 21, 2020, Playco announced that it had closed a $100 million round of fundraising involving Buckley, Caffeinated Capital, and others. Playco did not submit any evidence that deals of this size ordinarily proceed from scratch to closing in the space of only three weeks. As a consequence, a jury reasonably could infer that efforts to put together this funding round had begun much earlier.
Pointing out that the draft term sheet circulated on September 12 was unsigned and omitted terms such as the amount to be raised, valuation, and price per share, Playco asserts that it did not “begin to formalize plans for a new round until mid-September.” In fact, a reasonable jury might draw the opposite inference. While the draft term sheet does not contain several important terms, it also states that the initial closing shall be “no later than September 15, 2020.” Thus, far from establishing that Playco did not begin to finalize the fundraising round announced on September 21 until mid-September, the draft term sheet might suggest to a reasonable jury that the fundraising round was almost completed by September 12—which in turn suggests Playco had been preparing for— and, even more importantly, contemplating—the fundraising long before that.
Playco points out that that its chief executive officer Carter submitted a declaration stating that, “[a]s of August 30, 2020, Playco did not have any plans to fundraise.” However, in his declaration Carter does not appear to have been using the word “plan” in its broad sense. Carter states that Playco did not start to “formalize” a plan until mid- September and cites to his August 31 e-mail as evidence that, by that point, “Playco had not decided whether to pursue a financing round.” (Italics added.) As shown above, a jury reasonably could interpret “plans to fundraise” more broadly to mean “a proposed undertaking or goal” rather than formal or definitive plan. (Webster’s 3d New Internat.
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Dict., supra, p. 1729, col. 3.) Thus, Carter’s assertions concerning the state of Playco’s fundraising efforts do not establish that there are no triable issues concerning Waldron’s representation.
We therefore conclude that there is a triable issue whether Waldron’s August 15 e-mail falsely represented that Playco had no fundraising plans.
c. Evidence of Concealment Even if, as Carter asserts, the possibility of a new fundraising round was first raised on August 25—and Waldron’s representation 10 days earlier that Playco had no fundraising plans was true when made—there is still a triable issue on concealment. LVP alleged that, to the extent that plans for a new round of financing emerged after Waldron’s August 15 representation, Playco concealed those plans before the Stock Repurchase Agreement was signed on August 31. Playco cannot dispute that it had a duty to disclose such information and avoid misleading LVP. (See Rest.2d Torts, § 551(2) [“One party to a business transaction is under a duty to exercise reasonable care to disclose to the other before the transaction is consummated [¶] . . . [¶] (c) subsequently acquired information that he knows will make untrue or misleading a previous representation”].) Instead, Playco asserts that there is no evidence it had any fundraising plans even by the end of August 2020. For the reasons explained above, we conclude that there was sufficient evidence of such plans to raise a triable issue concerning concealment. Indeed, Buckley shared his draft memo with Carter on August 26, and Carter told Tonsing that Playco intended to do “a quick inside round” on August 31, the day that the Stock Repurchase Agreement was signed.
LVP also contends that there is a triable issue whether Playco intentionally concealed information concerning its financial performance. However, LVP did not allege such concealment in the second amended complaint. Accordingly, this claim cannot be considered on summary judgment. “It is well settled that the pleadings set the
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boundaries of the issues to be resolved at summary judgment.” (Vulk v. State Farm General Ins. Co. (2021) 69 Cal.App.5th 243, 255; see also Laabs v. City of Victorville (2008) 163 Cal.App.4th 1242, 1253 [“ ‘The pleadings delimit the issues to be considered on a motion for summary judgment.’ ”].) “ ‘ “Declarations in opposition to a motion for summary judgment ‘are no substitute for amended pleadings,’ ” ’ ” and “ ‘ “the plaintiff forfeits an opportunity to amend to state new claims by failing to request it.” ’ ” (Conroy, supra, 45 Cal.4th at p. 1254.) Consequently, “[i]f a plaintiff wishes to expand the issues presented, it is incumbent on the plaintiff to seek leave to amend the complaint either prior to the hearing on the motion for summary judgment, or at the hearing itself.” (Laabs, at p. 1258.)
LVP asserts that Code of Civil Procedure section 469 authorizes its new concealment claim. Under that section, “[v]ariance[s] between “the allegation in a pleading and the proof” are not deemed material unless the adverse party is prejudiced. (Code Civ. Proc., § 469.) However, this provision is normally applied to variances at trial, and LVP fails to cite any case in which this provision has been applied to a summary judgment motion or to offer any persuasive reason why the section’s language should be extended to that situation. As a consequence, we decline to depart from the wellestablished authority prohibiting consideration of unpled claims on summary judgment. (See People v. Williams (1997) 16 Cal.4th 153, 206 [“Points ‘perfunctorily asserted without argument in support’ are not properly raised.”].)
d. Reliance and Damages In their supplement letter brief, defendants argue that, even if Waldron’s representation that Playco had no fundraising plans is interpreted broadly, LVP’s fraud claim fails because LVP presented no evidence that it relied on such a representation or suffered damages from it. We decline to consider these arguments. Defendants did not argue in their summary judgment motion that LVP failed to raise a triable issue
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concerning reliance, and we will not consider such a factual question for the first time on appeal. (See, e.g., Noe v. Superior Court (2015) 237 Cal.App.4th 316, 335 [“We generally will not consider an argument ‘raised in an appeal from a grant of summary judgment . . . if it was not raised below and requires consideration of new factual questions.’ ”].) In addition, while defendants argued below that LVP failed to present evidence of damages, they did not include that argument in their initial brief on appeal, and we do not consider arguments raised by parties on their own initiative for the first time in supplemental briefing. (See, e.g., Randall v. Mousseau (2016) 2 Cal.App.5th 929, 936.) For similar reasons, we decline to consider defendants’ argument concerning materiality raised at oral argument. (See, e.g., People v. Arredondo (2019) 8 Cal.5th 694, 710, fn. 5 [“ ‘ “[a]n appellate court is not required to consider any point made for the first time at oral argument” ’ ”].)
Accordingly, we conclude that LVP raised a triable issue concerning the fraud claim in count one of the second amended complaint and that summary adjudication of this claim should be denied.
3. Count Two In count two of the second amended complaint, LVP claimed that Playco engaged in investment fraud under Corporations Code section 25401 by buying back LVP’s shares using untrue statements and material omissions. That section makes it unlawful to buy a security by means of a communication that “includes an untrue statement of a material fact or omits to state a material fact necessary to make the statements made, in the light of the circumstances under which the statements were made, not misleading.” (Corp. Code, § 25401.) The trial court ruled that there was no triable issue concerning investment fraud under this section for the same reason that there was no triable issue concerning common law fraud: namely, that LVP failed to present evidence of any false representation or concealment. On appeal, LVP argues that the trial court erred in making
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this ruling for the same reason it erred in ruling on LVP’s common law fraud claim. Defendants do not dispute that the two claims rise or fall together, and therefore we conclude that there are triable issues concerning the investment fraud as well as the common law fraud claims.
In addition to alleging investment fraud under Corporations Code section 25401, LVP alleged that Playco violated Corporations Code section 25501.5 by buying LVP’s shares without a broker-dealer license. The trial court rejected this claim on the ground that no such license is needed when the issuer of a stock buys or sells that stock. As LVP does not challenge that ruling, we will not disturb it. (See, e.g., Jones v. Jacobson (2011) 195 Cal.App.4th 1, 19, fn. 12 (Jones) [“[I]ssues and arguments not addressed in the briefs on appeal are deemed forfeited.”].)
Accordingly, we conclude that LVP raised a triable issue under Corporations Code section 25401 and summary adjudication of LVP’s investment fraud claim should be denied.
4. Declaratory Relief In addition to asserting claims for common law fraud and investment fraud, LVP sought a declaration that Playco induced it to sign the Stock Repurchase Agreement by fraud and deceit and that the agreement is therefore void. The trial court granted summary adjudication of this claim based on its ruling that there was no triable issue concerning fraud. Here again, LVP contends that the trial court’s ruling on the claim is erroneous for the same reason as the rulings on the fraud claims, and defendants do not suggest otherwise. Accordingly, we conclude that summary adjudication of LVP’s declaratory relief claim should be denied.
5. Punitive Damages Finally, we come to LVP’s request for punitive damages. (See Code Civ. Proc., § 437c, subd. (f)(1) [authorizing trial courts to grant summary adjudication concerning
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punitive damages].) LVP argues that the trial court erred in granting summary adjudication on this request for the same reason that it erred in granting summary adjudication on the fraud and declaratory relief claims. However, the trial court’s ruling concerning punitive damages was based on this ruling only in part. The trial court also granted summary adjudication on the punitive damages request for a second reason: The evidence of fraud presented by LVP was “not ‘clear and convincing’ as required by Civil Code section 3294, subdivision (c).” (See Aguilar, supra, 25 Cal.4th at p 850 (“There is a triable issue of material fact if, and only if, the evidence would allow a reasonable trier of fact to find the underlying fact in favor of the party opposing the motion [for summary judgment] in accordance with the applicable standard of proof,” italics added].) LVP does not address this second ruling in its briefs on appeal, and therefore it has forfeited any challenge to the trial court’s summary adjudication of its punitive damages request. (Jones, supra, 195 Cal.App.4th at p. 19, fn. 12.)
III. DISPOSITION
The judgment is reversed, and this matter is remanded to the trial court with instructions to deny summary judgment, to deny summary adjudication of appellant’s fraud, investment fraud, and declaratory relief claims, but to grant summary adjudication of appellant’s punitive damages request.
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BROMBERG, J.
WE CONCUR:
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GREENWOOD, P. J.
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DANNER, J.
Long Venture Partner LP v. Waldron et al. H053591