Mal Icious, Llc, V Random Erik Vaughn

CourtCourt of Appeals of Washington
DecidedNovember 12, 2025
Docket59739-0
StatusUnpublished

This text of Mal Icious, Llc, V Random Erik Vaughn (Mal Icious, Llc, V Random Erik Vaughn) is published on Counsel Stack Legal Research, covering Court of Appeals of Washington primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Mal Icious, Llc, V Random Erik Vaughn, (Wash. Ct. App. 2025).

Opinion

Filed Washington State Court of Appeals Division Two

November 12, 2025 IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

DIVISION II MAL ICIOUS, LLC, a Washington limited No. 59739-0-II liability company,

Respondent,

v.

RANDOM ERIK VAUGHN; ORIGINAL UNPUBLISHED OPINION INVESTMENTS, LLC, a Washington limited liability company; DANK’S WONDER EMPORIUM, LLC, a Washington limited liability company; DWE FRANCHISE, LLC, a Washington limited liability company; ATM SERVICE PRO, INC., an Oregon corporation; RENEWABLE INVESTMENTS INC., an Oregon corporation; ALYSSA WHITE; and ROBERT A. DAVENNY, JR,

Appellants,

MARK A. LAVERGNE, MAL ICIOUS, LLC, a Washington limited liability company, 2020 SOLUTIONS EDMONDS, LLC, a Washington limited liability company, 2020 SOLUTIONS EPHRATA, LLC; 2020 SOLUTIONS SOAP LAKE, LLC, a Washington limited liability company,

Third-Party Defendants.

GLASGOW, J.—Mal Icious LLC (MAL) contracted with Random Vaughn to manage and

staff a cannabis retail store that it owned in Edmonds, Washington. While operating the store,

Vaughn regularly transferred MAL’s profits to himself and his affiliates and inflated costs in the

Edmonds store’s accounting records to disguise his actions. Through his girlfriend, Alyssa White,

Vaughn applied for and received a federal Paycheck Protection Program (PPP) loan based on the No. 59739-0-II

Edmonds store’s labor costs. Although the loan was later forgiven, Vaughn did not credit its value

to MAL.

Two years after signing the contract, MAL’s owner ousted Vaughn and sued him for

conversion and breach of contract, among other claims. After a bench trial, MAL prevailed on its

claims for breach of contract and conversion. The trial court awarded MAL damages based on net

profits Vaughn had withheld, federal tax penalties MAL had accrued, credit for the PPP loan, and

the value of a voidable transfer Vaughn fraudulently made to his father. It also awarded MAL

prejudgment interest and attorney fees.

Vaughn appeals but does not identify in his assignments of error any challenge to specific

findings of fact. He argues that Washington’s Frye1 doctrine should have barred testimony from

MAL’s forensic accounting expert at trial; that the court should not have awarded damages based

on federal tax penalties, the uncredited PPP loan, and the fraudulent transfer to Vaughn’s father;

and that MAL was not entitled to prejudgment interest or attorney fees. We affirm and award MAL

attorney fees on appeal.

FACTS

I. BACKGROUND

Mark LaVergne formed Mal Icious LLC in order to obtain licenses from the Washington

State Liquor and Cannabis Board to run cannabis retail stores. Clerk’s Papers (CP) at 1553

(Finding of Fact (FF) 6).2 LaVergne planned to open a cannabis store in Edmonds but was unable

1 Frye v. United States, 54 App. D.C. 46, 293 F. 1013 (1923) 2 To describe the underlying facts, we rely to some extent on the trial court’s unchallenged findings of fact, which are verities on appeal. State v. O’Neill, 148 Wn.2d 564, 571, 62 P.3d 489 (2003). We also note that many facts presented in the appellants’ opening brief are unsupported by citations in violation of RAP 10.3(a)(6).

2 No. 59739-0-II

to run the store himself. In June 2018, MAL entered into several contracts with Random Vaughn’s

company, Dank’s Wonder Emporium Franchise LLC, that granted Dank’s total operational control

over the Edmonds store. At the time, Vaughn owned his own cannabis store in Olympia.

Vaughn drafted a general service agreement and included the following indemnification

provision:

[T]o the extent permitted by applicable law, each Party agrees to indemnify and hold harmless the other Party, and its respective directors, shareholders, [affiliates], [officers], agents, employees, and permitted successors and assigns against any and all claims, losses, damages, liabilities, penalties, punitive damages, expenses, reasonable legal fees and costs of any kind or amount whatsoever, which result from or arise out of any act or omission of the indemnifying party.

Ex. 3 (emphasis added).

Vaughn managed the Edmonds store and staffed it with workers contracted from

Renewable Investments Inc., a company owned by Vaughn’s girlfriend, Alyssa White. Throughout

his tenure running the Edmonds store, Vaughn regularly transferred its revenue to his Olympia

store and other entities affiliated with Vaughn, rather than sending the profits to MAL. CP at 1555

(Conclusions of Law (CL) 2).3

In February 2020, LaVergne and his associate, James Pottenger, met with Vaughn to ask

for accounting records in order to do MAL’s 2019 taxes. Vaughn did not immediately provide

accounting records, claiming that the books were not ready. During the meeting, Vaughn

complained about the difficulty of running a cannabis business in Washington and indicated that

he planned to move to California. Afterward, LaVergne and Pottenger discussed the need to find

a new manager to replace Vaughn, and ultimately to sell the store.

3 The trial court’s conclusions of law contain several findings of fact, and we treat them as such. See Kunkel v. Meridian Oil, Inc., 114 Wn.2d 896, 903, 792 P.2d 1254 (1990). Vaughn does not assign error to any of the court’s findings of fact.

3 No. 59739-0-II

In May 2020, White received a $366,334 PPP loan that she had applied for on behalf of

ATM Service Pro Inc., a company she owned that was closely connected to Renewable

Investments. The loan application was based in whole or in part on payroll for contract labor for

MAL’s Edmonds store. The loan was later forgiven. Vaughn and White did not disclose the PPP

loan or credit any of its value to MAL.

In June 2020, Vaughn’s father, Robert Davenny Jr., received a $350,000 transfer from

White’s company, Renewable Investments. Davenny had loaned Vaughn $658,000 a few years

previously and interpreted White’s transfer as partial repayment of the loan.

LaVergne found a buyer and new manager for the store during late summer of 2020. In

September, LaVergne, Pottenger, and the new manager went to the Edmonds store to take an

inventory and to oust Vaughn’s site manager and employees.

MAL sued Vaughn for breach of contract, embezzlement, conversion, and voidable transfers,

among other claims. MAL further contended that it had accrued federal income tax liability due to

Vaughn’s withholding of profits from the Edmonds store. In January 2021, MAL retained forensic

accountant Tiffany Couch to reconstruct Vaughn’s financial records for the Edmonds store in

preparation for trial.

II. EXPERT TESTIMONY

A bench trial occurred in January 2024. MAL called Couch to testify as an expert witness.

Couch testified to her qualifications, including a bachelor’s degree in accounting, a CPA

credential, a certification in financial forensics from the American Institute of Certified Public

Accountants, and roughly twenty years of professional experience, among other things.

4 No. 59739-0-II

Couch testified that she had relied on several different records to reconstruct Vaughn’s

books, most notably point-of-sale reports from Greenbits;4 a QuickBooks file maintained by

Vaughn or someone employed by Vaughn; a “Cash Tracker” Excel spreadsheet that purportedly

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Hansen v. Rothaus
730 P.2d 662 (Washington Supreme Court, 1986)
Comfort & Fleming Insurance Brokers, Inc. v. Hoxsey
613 P.2d 138 (Court of Appeals of Washington, 1980)
Prier v. Refrigeration Engineering Co.
442 P.2d 621 (Washington Supreme Court, 1968)
Cowiche Canyon Conservancy v. Bosley
828 P.2d 549 (Washington Supreme Court, 1992)
State v. Florczak
882 P.2d 199 (Court of Appeals of Washington, 1994)
Kunkel v. Meridian Oil, Inc.
792 P.2d 1254 (Washington Supreme Court, 1990)
Forbes v. AMERICAN BLDG. MAINTENANCE WEST
240 P.3d 790 (Washington Supreme Court, 2010)
Weyerhaeuser Co. v. Commercial Union Ins.
15 P.3d 115 (Washington Supreme Court, 2001)
Smith v. EMPLOYMENT SECURITY DEPT.
226 P.3d 263 (Court of Appeals of Washington, 2010)
In Re Detention of Taylor
134 P.3d 254 (Court of Appeals of Washington, 2006)
MacLean Townhomes v. America 1st Roofing & Builders Inc.
138 P.3d 155 (Court of Appeals of Washington, 2006)
Torgerson v. One Lincoln Tower, LLC
210 P.3d 318 (Washington Supreme Court, 2009)
State Of Washington v. Karen A. Conway
438 P.3d 1235 (Court of Appeals of Washington, 2019)
Rekhter v. Department of Social & Health Services
323 P.3d 1036 (Washington Supreme Court, 2014)
Weyerhaeuser Co. v. Commercial Union Insurance
142 Wash. 2d 654 (Washington Supreme Court, 2000)
State v. O'Neill
62 P.3d 489 (Washington Supreme Court, 2003)
Torgerson v. One Lincoln Tower, LLC
166 Wash. 2d 510 (Washington Supreme Court, 2009)
Forbes v. American Building Maintenance Co. West
170 Wash. 2d 157 (Washington Supreme Court, 2010)
Humphrey Industries, Ltd. v. Clay Street Associates, LLC
295 P.3d 231 (Washington Supreme Court, 2013)
In re the Detention of Taylor
132 Wash. App. 827 (Court of Appeals of Washington, 2006)

Cite This Page — Counsel Stack

Bluebook (online)
Mal Icious, Llc, V Random Erik Vaughn, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mal-icious-llc-v-random-erik-vaughn-washctapp-2025.