Defendant/Cross-Complainant’s Motion for Summary Judgment/Adjudication
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LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 13, 2026 TIME: 8:30 A.M.
accounting of the bonus; Jeffrey says he never received such nor found any evidence in the firm’s records supporting such a bonus. Jeffrey thereafter demanded that Everett return the 4% interest, which he claims Everett refused to do. The firm’s counsel sent a letter to Everett requesting evidence that the 4% interest was conferred as a bonus, but did not receive a response. Everett died on June 2, 2024. (SAC ¶¶ 27-23.) Jeffrey believes that Everett’s trust includes the ill-gotten 4% interest.
No. 16CV01899
GRANNY PURPS, INC., et al. v. COUNTY OF SANTA CRUZ, et al.
DEFENDANT/CROSS-COMPLAINANT’S MOTION FOR SUMMARY JUDGMENT/ADJUDICATION
Defendant County of Santa Cruz’s motion for summary adjudication is granted. Crossdefendants failed to establish, by admissible evidence, the existence of any disputed triable factual issues, as detailed below.
I. FACTUAL AND PROCEDURAL BACKGROUND
This case was filed on July 26, 2016, by Granny Purps, Inc., a cannabis cultivator, against the County of Santa Cruz (“the County”), Sheriff Jim Hart and Deputy Frank Gombos, following two Sheriff’s Department raids in which 1800 marijuana plants were destroyed in the first raid and 700 in a second raid. The complaint alleges causes of action for negligent destruction of property, conversion, trespass, inverse condemnation, declaratory relief, and preliminary and permanent injunction. On June 23, 2017, Granny Purps filed a first amended complaint and petition for writ of mandate against the same defendants. The first amended complaint alleges causes of action for writ of mandate, conversion, trespass, inverse condemnation, declaratory relief, preliminary and permanent injunction, and specific recovery of property.
On April 25, 2017, Granny Purps filed an amended verified petition for writ of administrative mandamus or writ of mandamus (case no. 17CV00837 or “the Writ Case”) against the County concerning the County’s denial of a cannabis dispensary license it applied for. On October 12, 2017, the court entered a stipulated judgment against Granny Purps in favor of the County on the County’s cross-complaint in the Writ Case. (RJN # 11.) The stipulated judgment was signed by Nancy Black, Nancy Sudman, and Jeffrey Sudman on behalf of Granny Purps. The judgment ordered Granny Purps to pay the County $1,6725,500.00 for fines related to operating an unlicensed dispensary. The judgment stated that by October 31, 2017, Granny Purps
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LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 13, 2026 TIME: 8:30 A.M.
was to wind up and dissolve its corporate entity and was to cease all business of any kind, including business transactions, sales or purchases.
On October 18, 2018, the court ruled against Granny Purps in their motion to enforce the judgment pursuant to Code of Civil Procedure section 664.6, finding that Black and the Sudmans had continued to operate Granny Purps despite the court’s previous order. On August 5, 2019, the court issued a writ of execution in the amount of $1,805,841.79 against Granny Purps, Jeffrey Sudman, Nancy Sudman, and Nancy Kay Black in the Writ Case.
On June 9, 2021, the County filed this cross-complaint against Canna Consulting, Inc., Granny Purps, Jeffrey Sudman, Nancy Black, and Nancy Sudman for fraudulent transfer, constructive fraudulent transfer, violation of Business and Professions Code section 17200, declaratory relief, and unjust enrichment.
The County’s cross-complaint asserts that Granny Purps and Canna Consulting, Inc. are the alter egos of each other. Granny Purps was suspended by the California Franchise Tax Board and was barred from conducting business in California. (X-Compl. at ¶ 2.) The cross-complaint alleges that Granny Purps, Black and the Sudmans jointly and severally owe the County approximately $2.2 million dollars, pursuant to the stipulated judgment in the Writ Case. The cross-complaint contends this case was initially pursued by Granny Purps but during the pendency of this case, its corporate status was suspended, and the named plaintiff changed to Canna Consulting, Inc. (X-Compl. at ¶¶ 19-20.)
On October 1, 2017, Granny Purps, via Nancy Black, transferred all rights, title, and interest in this litigation (case no. 16CV01899) to Jeffrey Sudman. (Decl. of Sewitsky, Ex. A2.) On November 20, 2017, Jeffrey Sudman assigned all rights, title, and interest in this litigation to Canna Consulting, Inc. (X-Compl. at ¶ 21, Decl. of Sewitsky, Ex. A3.)
The County contends these two assignments “are constructively and/or actively fraudulent and violate the terms of the COUNTY JUDGMENT in that they were designed, intended and could deprive the COUNTY of the benefit of that judgment, both monetarily and in terms of agreement upon facts and agreed upon future conduct by the parties to the COUNTY JUDGMENT, which no only precluded GRANNY PURPS’ continued engagement in the marijuana dispensary business after October 31, 2017 but also precluded GRANNY PURPS’ officers, directors, successors and assignment from engaging such business.” (X-Compl. at ¶ 22.)
The County emphasizes that the assignment from Granny Purps to Jeffrey Sudman and Jeffrey Sudman’s assignment to Canna Consulting “was a self-dealing sham devised to thwart and undermine the COUNTY JUDGMENT and other creditors. It is marked by fraud and collusion and was done in violation of the COUNTY JUDGMENT’s agreed upon requirements.” (X- Compl. at ¶ 25.)
LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 13, 2026 TIME: 8:30 A.M.
The County brought a motion for summary judgment as to plaintiffs’ first amended complaint, which this Court granted on February 2, 2024. Plaintiffs appealed the order; the Sixth Appellate District dismissed the notice of appeal without prejudice, as premature and/or taken from a non-appealable order.
On March 11, 2026, the County filed this motion for summary adjudication to the first two causes of action in its cross-complaint for fraudulent transfer and constructive fraudulent transfer. The Court requested and received further briefings from the parties to explain the need for this motion given that the Court already granted the County’s motion for summary judgment. The County asserts that the Court should resolve the issues raised in its motion for summary adjudication because a successful MSA will allow the County to dismiss the remaining causes of action and obtain one final judgment, which would be necessary for appeal. (County’s Supp.
Brief at p. 2.) Cross-defendants assert that “the case is over pursuant to CCP § 583.310” because the crossclaims were not brought to trial within five years.3 Cross-defendants argue that the stipulated judgment in the Writ Case governs claims for Granny Purps’ liabilities, not this case. The parties previously filed substantive moving papers, opposition, and reply to the County’s motion for summary adjudication.
II. SUMMARY ADJUDICATION STANDARD
Summary adjudication lies when one or more causes of action have merit; one or more claims for damages has no merit; there is no merit to a claim for punitive damages; there is no affirmative defense (or merit to affirmative defenses) to one or more causes of action or claim for damages; or that one or more defendants either owed or did not owe a duty to plaintiffs. (Weil & Brown Civ. Proc. Before Trial (TRG 2025) § 10:32, Code Civ. Proc. § 437c, sub. (f)(1).)
“[T]he moving party bears the initial burden of production to make a prima facie showing that there are not triable issues of material fact. [Aguilar v. Atlantic Richfield Co. (2001) 24Cal.4th 826, 850].” (Weil & Brown Civ. Proc. Before Trial (TRG 2026) § 10:227.) In opposition to a motion for summary judgment/adjudication, the party “must produce admissible evidence raising a triable issue of fact. Claims and theories not supported by admissible evidence do not raise a triable issue. [Citations.]” (Id. at §10:253.1.)
3 Code of Civil Procedure section 583.310 states that “[a]n action shall be brought to trial within five years after the action is commenced against the defendant.” Section 583.360 provides that an action shall be dismissed by the court on its own motion or upon “motion of the defendants, after notice of the parties, if the action not brought to trail within the time prescribed in this article.” Cross-defendants have not brought a noticed motion for involuntary dismissal of this action.
LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 13, 2026 TIME: 8:30 A.M.
III. THE COUNTY’S MOTION
The County forwards three issues in its motion: (1) that the assignments from Granny Purps to Jeffrey Sudman and then from Sudman from Canna Consulting are voidable because of cross-defendants’ actual fraud; (2) the good faith defense is not available Jeffrey Sudman or Canna Consulting; and (3) Granny Purps’, Nancy Blacks’ and Jeffrey Sudman’s assignment of the “chose in action” are voidable because the assignments were constructively fraudulent,
The County cites the Uniform Voidable Transactions Act which it argues is designed to prevent debtors from placing property, that should be reachable to creditors, beyond their reach. (Memorandum of Points and Authorities (“MPA”) at p. 11.) The County maintains that “a transfer made or obligation incurred by a debtor is voidable as to a creditor, whether the creditor’s claim arose before or after the transfer was made or the obligation was incurred, if the debtor made the transfer or incurred the obligations with the actual intent to hinder, delay or defraud a creditor. (Civ. Code § 3429.04(a)(1).)” (MPA at p. 12.) The County argues the assignments caused the potential proceeds from this litigation to be moved out of its hands (the creditor) and to Canna Consulting, who was not part of the stipulated judgment.
The County maintains the court looks to a list of factors pursuant to Civil Code section 3439.04 to determine when a transfer is voidable:
“(a) A transfer made or obligation incurred by a debtor is voidable as to a creditor, whether the creditor's claim arose before or after the transfer was made or the obligation was incurred, if the debtor made the transfer or incurred the obligation as follows:
(1) With actual intent to hinder, delay, or defraud any creditor of the debtor.
(2) Without receiving a reasonably equivalent value in exchange for the transfer or obligation, and the debtor either:
(A) Was engaged or was about to engage in a business or a transaction for which the remaining assets of the debtor were unreasonably small in relation to the business or transaction.
(B) Intended to incur, or believed or reasonably should have believed that the debtor would incur, debts beyond the debtor's ability to pay as they became due.
(b) In determining actual intent under paragraph (1) of subdivision (a), consideration may be given, among other factors, to any or all of the following:
(1) Whether the transfer or obligation was to an insider.
LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 13, 2026 TIME: 8:30 A.M.
(2) Whether the debtor retained possession or control of the property transferred after the transfer.
(3) Whether the transfer or obligation was disclosed or concealed.
(4) Whether before the transfer was made or obligation was incurred, the debtor had been sued or threatened with suit.
(5) Whether the transfer was of substantially all the debtor's assets.
(6) Whether the debtor absconded.
(7) Whether the debtor removed or concealed assets.
(8) Whether the value of the consideration received by the debtor was reasonably equivalent to the value of the asset transferred or the amount of the obligation incurred.
(9) Whether the debtor was insolvent or became insolvent shortly after the transfer was made or the obligation was incurred.
(10) Whether the transfer occurred shortly before or shortly after a substantial debt was incurred.
(11) Whether the debtor transferred the essential assets of the business to a lienor that transferred the assets to an insider of the debtor.
(c) A creditor making a claim for relief under subdivision (a) has the burden of proving the elements of the claim for relief by a preponderance of the evidence.”
IV. MATERIAL FACTS ARE NOT IN DISPUTE
Each material fact must have a citation to supporting evidence. (Code of Civ. Proc. § 437c(b)(1).)
The following facts proffered by the County are not disputed by cross-defendants: • That the County has a right to payment from Granny Purps, Jeffrey Sudman, Nancy Black, and Nancy Sudman for $1,672,500.00 before accrued interest, pursuant to the judgment entered against them in case number 17CV00837. • On October 1, 2017, Nancy Black, on behalf of Granny Purps, transferred all rights, title and interest in Santa Cruz County Superior Court case no. 16CV01899 from Granny Purps to Jeffrey Sudman.
LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 13, 2026 TIME: 8:30 A.M.
• On November 20, 2017, Jeffrey Sudman transferred all rights, title, and interest in case no. 16CV01899 to Canna Consulting, Inc. (UMF nos. 1-3.)
The County provides evidence relating to the various “badges” or indicia of fraud as outlined by Civil Code section 3439.04: that the transfers were made to insiders in the company, that the debtors retained control of the “chose-in action”, that Granny Purps and Jeffrey Sudman concealed their assignments while actively litigating the underlying case on appeal; that the transfers constituted substantially all of debtors’ assets; that the value Granny Purps, Black and the Sudmans received from their assignments was not reasonably equivalent to the value; that the assignment from Granny Purps to Jeffrey Sudman occurred 10 days before the parties signed the stipulated judgment in the Writ Case; that the assignments were an essential asset of Granny Purps; and that the Assignments ran afoul of the stipulated judgment in the Writ Case. (UMF Nos. 1-18.) “To prove intent to hinder, delay, or defraud creditors, it is not necessary to show that [debtor] had a desire to harm their creditors.
Plaintiff need only show that [debtor] intended to remove or conceal assets to make it more difficult for [its] creditors to collect payment.” (CACI 4200.) “Whether a debtor had the actual intent to hinder, delay, or defraud a creditor is a question of fact.” (Aghaian v. Minassian (2020) 59 Cal.App.5th 447, 456.) “Among other socalled ‘badges of fraud’ indicating such intent [Citation] the fact finder may consider whether: (1) the debtor made the transfer to an ‘insider’; (2) the debtor retained possession or control of the property after the transfer; (3) the debtor had been sued before making the transfer; (4) the debtor removed or concealed assets; (5) the value of the consideration received by the debtor was reasonably equivalent to the value of the asset transferred; and (6) the transfer occurred shortly before or shortly after a substantial debt was incurred (§ 3439.04, subd. (b)).
None of these factors is determinative, and no minimum or maximum number of factors is required.” (Aghaian, supra, 59 Cal.App.5th at p. 456.)
There is no dispute that Jeffrey Sudman was CEO of Granny Purps and after he resigned, he continued to work for Granny Purps. Nancy Black is Jeffrey Sudman’s mother-in-law; the two resided together until 2019. (UMF no. 4.) Similarly, the second transfer from Jeffrey Sudman to Canna Consulting was made to another “insider”, as Jeffrey Sudman is the owner, officer, and director of Canna Consulting. (UMF no. 5.) The County asserts that Granny Purps, Nancy Black, and Jeffrey Sudman retained control of the chose in action, which is another “badge of fraud.”
The County’s supporting evidence for this is found in UMF numbers 4-6: that Jeffrey Sudman was the CEO of Granny Purps and continued working there; that Jeffrey Sudman owns Canna Consulting, Inc. and is its sole corporate officer and director; that Canna Consulting has no income, no business activities and that it has not created corporate documents since its formation nor held meetings or prepared minutes. Jeffrey Sudman testified that he uses personal funds to keep Canna Consulting, Inc. active.
Jeffrey Sudman was heavily involved in Granny Purps as well as Canna Consulting, which became the plaintiff in this case. The Court finds the
LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 13, 2026 TIME: 8:30 A.M.
County satisfied its prima facie burden in establishing the voidability of the assignments and the lack of a good faith defense.
The burden then shifts to cross-defendants to raise a triable issue. The only evidence that cross-defendants provide to raise a triable issue is a declaration from Nancy Sudman. While she is a party to this action as a cross-defendant, she was not involved in any of the assignments. There are no declarations from Jeffrey Sudman or Nancy Black, who are the two individuals directly involved in the assignments. By her own deposition testimony, Nancy Sudman resigned her position as corporate officer on December 1, 2016, the same day Jeffrey Sudman resigned.
When asked if she continued to do anything for Granny Purps, she testified that she did not perform any further duties for Granny Purps other than be supportive and help in the kitchen. (Ex. 1 to Decl. of Sewistksy.) After Nancy and Jeffrey Sudman resigned, Nancy Black took on the corporate roles at Granny Purps. (Ex. 1. to Decl. of Sewitsky.) The Court does not find that Nancy Sudman’s declaration raises a triable issue because it lacks personal knowledge, is speculative, and lacks foundation.
Her declaration that the assignments were not done with fraudulent intent is not fact as she had no personal involvement in the assignments and had no official role in the company at the time the assignments were carried out.
The motion for summary adjudication is granted as to the first and second causes of action for fraudulent transfer and constructive fraudulent transfer. The Court anticipates that the County will dismiss the balance of its cross-complaint based upon this decision, and that the County will be simultaneously submitting the proposed order based upon this tentative, a dismissal, and proposed judgment.
The County’s Objections to the Declaration of Nancy Sudman
Objections 1- 8 are sustained as the statements are speculative and lack personal knowledge.
The County’s Request for Judicial Notice: Exhibit 1: The first government tort claim (Claim No. 516-032) presented by Granny Purps, Inc. to the County of Santa Cruz, dated December 21, 2015. Granted.
Exhibit 2: The second government tort claim (Claim No. 516-073) presented by Granny Purps, Inc. to the County of Santa Cruz, dated April 6, 2016. Granted.
Exhibit 3: “Notice of Action on Claim” of January 29, 2016, with proof of service, prepared and mailed by the County of Santa Cruz to Granny Purps, Inc., rejecting its first tort claim presented to the County (Exhibit “C” above, Claim No. 516-032). Granted.
LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 13, 2026 TIME: 8:30 A.M.
Exhibit 4: “Notice of Action on Claim” May 12, 2016, with proof of service, prepared and mailed by the County of Santa Cruz to Granny Purps, Inc., rejecting its second tort claim presented to the County (Exhibit “D” above, Claim No. 516-073). Granted.
Exhibit 5: “Certificate of Status” issued by the California Secretary of State regarding Granny Purps, Inc., Entity Number C3325327, and reflecting that Granny Purps, Inc.’s “powers, rights and privileges” were suspended by the California Franchise Tax Board on May 2, 2016, and pursuant to the California Revenue and Taxation Code. Granted.
Exhibit 6: “Certificate of Revivor” issued by the California Franchise Tax Board for Granny Purps, Inc., Entity Number C3325327, and reflecting that Granny Purps, Inc. was “relieved of suspension or forfeiture and is now in good standing with the Franchise Tax Board” effective as of December 19, 2016. Granted.
Exhibit 7: Granny Purps’ Verified Petition (in the “Writ Case”) in Granny Purps. Inc., v. County of Santa Cruz., et al., Santa Cruz Superior Court, Case No. 17CV00837 (with memorandum of points and authorities and attachments). Granted.
Exhibit 8: Granny Purps’ Amended Verified Petition (in the “Writ Case”) in Granny Purps. Inc., v. County of Santa Cruz., et al., Santa Cruz Superior Court, Case No. 17CV00837. Granted.
Exhibit 9: County of Santa Cruz’s Cross Complaint against Granny Purps, Nany Kay Black, Jeffrey Sudman, and Nancy Sudman, et al., (in the “Writ Case”) in Granny Purps. Inc., v. County of Santa Cruz., et al., Santa Cruz Superior Court, Case No. 17CV00837. Granted.
Exhibit 10: Notice of Entry of Order Dismissing Granny Purps’ First Amended Verified Petition (in the “Writ Case”) in Granny Purps. Inc., v. County of Santa Cruz., et al., Santa Cruz Superior Court, Case No. 17CV00837 (sustaining demurrer and granting motion to strike without leave to amend). Granted.
Exhibit 11: Stipulated Judgment in favor of the County of Santa Cruz on the County’s Cross Complaint and against Granny Purps, et al., (in the “Writ Case”) in Granny Purps. Inc., v. County of Santa Cruz., et al., Santa Cruz Superior Court, Case No. 17CV00837. Granted.
Exhibit 12: Notice of Entry of Order Amending (Ex. “11”) Judgment entered against Granny Purps, Nancy Sudman, Nancy Kay Black and Jeffrey Sudman on October 23, 2018, in favor of the County of Santa Cruz (in the “Writ Case”) in Granny Purps. Inc., v. County of Santa Cruz., et al., Santa Cruz Superior Court, Case No. 17CV00837. Granted.
Exhibit 13: Sixth District Court of Appeals, Docket (Register of Actions) for Case Number H045387, Granny Purps, Inc. v. County of Santa Cruz et al. Granted.
LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 13, 2026 TIME: 8:30 A.M.
Exhibit 14: Appellant Granny Purps Opening Brief in Sixth District Court of Appeals, Case Number H045387. Granted.
Exhibit 15: Granny Purp’s Supplemental Certificate of Interested Entities, filed July 9, 2019. Granted.
Exhibit 16: Appellate decision in re: Granny Purps, Inc. v. County of Santa Cruz (2020) 53 Cal.App.5th 1. Granted.
Exhibit 17 State of California Secretary of State Statement of Information for Granny Purps, Inc., filed November 17, 2016. Granted.
Exhibit 18 Canna Consulting, Inc., Articles of Incorporation, dated November 17, 2017, reflecting the corporate purpose of Canna Consulting. Granted.