Rahgoshay v. Pugh CA4/3

CourtCalifornia Court of Appeal
DecidedApril 20, 2026
DocketG063534
StatusUnpublished

This text of Rahgoshay v. Pugh CA4/3 (Rahgoshay v. Pugh CA4/3) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Rahgoshay v. Pugh CA4/3, (Cal. Ct. App. 2026).

Opinion

Filed 4/20/26 Rahgoshay v. Pugh CA4/3

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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

FOURTH APPELLATE DISTRICT

DIVISION THREE

MOHAMMAD RAHGOSHAY et al.,

Plaintiffs and Appellants, G063534

v. (Super. Ct. No. 30-2018- 00982971) SAHAR S. PUGH et al., OPINION Defendants and Respondents.

Appeal from a judgment of the Superior Court of Orange County, Nick A. Dourbetas, Judge. Affirmed. Law Offices of Craig J. Beauchamp and Craig J. Beauchamp for Plaintiffs and Appellants. Milstein Jackson Fairchild & Wade, Mark A. Milstein and Mayo L. Makarczyk for Defendants and Respondents. * * * Plaintiffs in this lawsuit are Mohammad Rahgoshay and MRMK, LLC (MRMK). Rahgoshay and nonparty Fariborz Wosoughkia (Kia)1 were business partners who made three investments together. Two of these were made through MRMK, an entity they formed to pursue their investments. Defendant Sahar S. Pugh is an attorney employed by defendant Milstein Jackson Fairchild & Wade LLP (Milstein; collectively defendants). Pugh provided some assistance to Rahgoshay, Kia, and MRMK in making these investments, but the parties dispute the extent of her involvement. Plaintiffs claim Pugh orally agreed to represent them, while defendants contend Pugh was doing Kia a personal favor. Plaintiffs lost hundreds of thousands of dollars in the three investments, and Rahgoshay and Kia’s relationship deteriorated. Plaintiffs then sued defendants for legal malpractice, breach of fiduciary duty, and breach of oral contract. Generally, plaintiffs alleged that Pugh had provided deficient legal services in connection with the three investments. After a bench trial, the trial court ruled in defendants’ favor. It largely relied on the testimony of Pugh and Kia, who both testified that defendants never provided legal representation to Kia or plaintiffs. The court subsequently entered judgment in defendants’ favor. Plaintiffs’ contentions on appeal are difficult to parse, and many of their arguments are not clearly articulated. They appear to primarily argue that the trial court erred in finding Kia’s and Pugh’s testimony to be credible. But plaintiffs misconstrue the legal standard for challenging credibility findings and have failed to show the testimony believed by the

1 Fariborz Wosoughkia is also known as Mike Kia, and he was

referred to as Mr. Kia during trial.

2 court was “‘“unbelievable per se,”’ physically impossible or ‘“wholly unacceptable to reasonable minds.”’” (Oldham v. Kizer (1991) 235 Cal.App.3d 1046, 1065.) We also reject plaintiffs’ apparent contention that the trial court erred in finding no oral contract and no attorney-client or fiduciary relationship between defendants and plaintiffs. While plaintiffs have cited evidence from which the lower court could have ruled differently, they have not shown that its findings are unsupported by substantial evidence. The judgment is affirmed.2 FACTS AND PROCEDURAL HISTORY I. THE INVESTMENTS Rahgoshay and Kia met in early 2015 and agreed to partner together to make investments. When they met, Rahgoshay had a real estate broker’s license and invested in real estate. Rahgoshay and Kia’s first investment occurred prior to MRMK’s creation. They invested in ModTech Global, Inc. (ModTech), which had created a media streaming device that was compared at trial “to a more advanced [Amazon] Fire Stick.” Kia and one of ModTech’s principals signed a memorandum of understanding (MOU) in November 2015. Under the MOU, Rahgoshay and Kia agreed to purchase 25 percent of ModTech’s stock in exchange for eight total payments of $1,500,000, with an initial payment of $100,000. This 25 percent ownership share was supposed to be held by an

2 We grant plaintiffs’ unopposed motion to correct misstatements

and missing citations in their opening brief. (See Cal. Rules of Court, rule 8.204(e)(2)(A).) We also grant their motion to augment the record. (See Cal. Rules of Court, rule 8.155(a).)

3 entity to be created called “WR,” which would have signing authority for ModTech’s bank account. Around this time, ModTech, Rahgoshay, and Kia began sharing an office suite in a building in Newport Beach. Their suite was next door to Pugh’s office. Kia and Pugh met around late 2015, due to the proximity of their respective offices. According to Pugh, she and Kia “were both kind of social.” After they met, he was in her office all the time and “constantly . . . asking [her] for favors” like “us[ing] the copy machine or send[ing] an e-mail on his behalf.” According to Pugh, Kia started asking for help with investments in late 2015 or early 2016. She was happy to assist since “[Kia] was a co-tenant,” “friendly,” and “seemed like he needed some help.” She also explained that she has “an open door at [her] office, and people pop in and we help each other.” Kia introduced Pugh and Rahgoshay. Plaintiffs claim there was a meeting between Rahgoshay, Kia, and Pugh in December 2015, in which Pugh orally agreed to provide Rahgoshay and Kia with legal services for their investments. These services allegedly included forming entities to hold investments, preparing agreements for stock purchases, providing general legal counsel to Rahgoshay and Kia and any entities they formed, and conducting due diligence for potential investments. At trial, Pugh could not recall this meeting, while Kia denied any such meeting occurred. Rahgoshay and Kia made their initial $100,000 payment to ModTech after the alleged meeting between them and Pugh in December 2015. Rahgoshay provided the funds for this investment. After the ModTech investment, Rahgoshay and Kia incorporated MRMK in Nevada as their investment vehicle. MRMK’s articles of organization list Rahgoshay and Kia as MRMK’s only two managers.

4 Rahgoshay and Kia made two investments through MRMK. Shortly after its formation, MRMK invested $100,000 in Peri, Inc. (Peri), which was developing an “intelligent phone case cover.” Rahgoshay provided MRMK with this investment capital. The other investment was in ERA Ventura, LLC (ERA), which owned a nightclub and restaurant. Plaintiffs assert that MRMK invested $460,000 in ERA based on Pugh’s recommendation. It invested $120,000 in February 2016, followed by investments of $240,000 and $100,000 in March and July 2016, respectively. Rahgoshay again provided the investment capital. Plaintiffs assert that Pugh was MRMK’s general counsel. The record also contains several e-mail exchanges between Pugh and various representatives of Peri and ERA concerning the investments. II. THE LAWSUIT The above investments all failed, and Rahgoshay and Kia had a falling out. Plaintiffs filed this lawsuit in March 2018, alleging that Pugh had failed to exercise reasonable care in providing legal services for the investments and had prioritized Kia’s interests over theirs. As to the ModTech investment, plaintiffs claimed that Pugh was supposed to form WR to hold Rahgoshay and Kia’s investment in ModTech but failed to do so. Instead, ModTech allegedly added both Rahgoshay and Kia as signatories to its bank account in place of WR based on Pugh’s advice. This purportedly allowed Kia to improperly take $55,000 from ModTech’s account for his personal use, which harmed ModTech and led to its failure. Next, plaintiffs asserted that Kia had represented to them that Pugh had reviewed Peri’s financial information and approved the investment.

5 However, plaintiffs claimed they later learned that Pugh had not reviewed these documents, and they would not have invested in Peri had they known this.

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