BRETT BIRKELAND V. PROEQUITY ASSET MANAGEMENT CORPORATION

August 14, 2026 Dept. 9 Civil Tentative Rulings

SUPPLEMENTAL RESPONSE TO REQUEST NO. 67: ProEquity Asset Management Corporation never purchased Plaintiff's shares in the Corporation. The documents responsive to this Request relate to the negotiations and drafts of the Separation Agreement concerning a potential purchase, which was never executed. Those documents are the same documents responsive to Requests for Production Nos. 3, 5, and 7, and were produced to Plaintiff on April 3, 2026. Production as to this Request is complete.

The Court finds that Defendant’s supplemental response is sufficient. The request seeks documents relating to Defendant’s purchase of Plaintiff’s shares in ProEquity. Defendant responded that Defendant never purchased Plaintiff’s shares – therefore, no such documents exist. Plaintiff’s request is denied.

REQUEST FOR PRODUCTION NO. 69: DOCUMENTS RELATING TO PROEQUITY'S delivery to PLAINTIFF of the Settlement Statement and payments due to PLAINTIFF thereunder, as referenced in the SEPARATION AGREEMENT.

RESPONSE TO REQUEST FOR PRODUCTION NO. 69: Responding Party objects to this request as it is uncertain, overbroad, unduly burdensome, and is unlimited in subject matter and scope. Responding Party objects to the extent propounding party seeks to impermissible information protected by attorney-client privilege and/or the attorney work product doctrine by its definition. Responding Party further objects to this Request for Production of Document to the extent it seeks information protected by third-party privacy rights, and/or confidential information protected by constitutional, statutory, or common law rights of privacy, including tax and financial privacy rights. Responding Party PROEQUITY responds as follows: Responding Party will produce all responsive, non-privileged documents in its possession, custody, or control.

SUPPLEMENTAL RESPONSE TO REQUEST NO. 69: The SEPARATION AGREEMENT was never executed. Because no separation agreement was executed, no Settlement Statement was delivered to Plaintiff and no payments became due to Plaintiff thereunder, and after a diligent search and reasonable inquiry Responding Party is unable to comply with this Request because no documents responsive to it have ever existed. The drafted separation agreement and the documents relating to it were produced to Plaintiff on April 3, 2026 in response to Requests for Production Nos. 3, 5, and 7.

The Court finds that Defendant’s supplemental response is sufficient. The request seeks documents relating to Defendant’s delivery to Plaintiff of the Settlement Statement and payments due to Plaintiff as referenced in the Separation Agreement. Defendant responded that as the Separation Agreement was never executed, no Settlement Statements and payments were delivered to Plaintiff – therefore, no such documents exist. Plaintiff’s request is denied.

August 14, 2026 Dept. 9 Civil Tentative Rulings

REQUEST FOR PRODUCTION NO. 71: DOCUMENTS RELATING TO PRO EQUITY'S delivery to PLAINTIFF of the executed purchase promissory note referenced in the SEPARATION AGREEMENT.

RESPONSE TO REQUEST FOR PRODUCTION NO. 71: Responding Party objects to this request as it is uncertain, overbroad, unduly burdensome, and is unlimited in subject matter and scope. Responding Party objects to the extent propounding party seeks information protected by attorney-client privilege and/or the attorney work product doctrine by its definition. Responding Party further objects to this Request for Production of Document to the extent it seeks information protected by third-party privacy rights, and/or confidential information protected by constitutional, statutory, or common law rights of privacy, including tax and financial privacy rights.

Responding Party objects to this request to the extent it seeks information that is protected by attorney-client privilege and/or attorney work product doctrine. Responding Party PROEQUITY responds as follows: Responding Party will produce all responsive, non-privileged documents in its possession, custody, or control.

SUPPLEMENTAL RESPONSE TO REQUEST NO. 71: The SEPARATION AGREEMENT was never executed. A purchase promissory note was drafted in connection with the proposed separation, but that note was never agreed to, was never executed, and was never delivered to Plaintiff. Because no executed note came into existence, no documents relating to its delivery have ever existed, and after a diligent search and reasonable inquiry Responding Party is unable to comply with this Request. The drafted promissory note, the drafted separation agreement, and the documents relating to them were produced to Plaintiff on April 3, 2026 in response to Requests for Production Nos. 3, 5, and 7.

The Court finds that Defendant’s supplemental response is sufficient. The request seeks documents relating to Defendant’s delivery to Plaintiff of the executed purchase promissory note referenced in the Separation Agreement. Defendant responded that as the Separation Agreement was never executed, no promissory note was executed or delivered to Plaintiff – therefore, no such documents exist. Plaintiff’s request is denied.

Sanctions

Plaintiff’s request for sanctions is denied.

MOTION TO BIFURCATE

The Parties met and conferred yet were unable to reach an agreement regarding Defendant’s motion for bifurcation. Defendant moves for an order bifurcating the trial pursuant to Code of Civil Procedure §§ 598 and 1048(b). // //

August 14, 2026 Dept. 9 Civil Tentative Rulings

Background

Plaintiff’s Complaint filed on August 7, 2024, asserts causes of action for 1) Involuntary Dissolution of ProEquity Pursuant to Corporations Code § 1800(b)(4); 2) Involuntary Dissolution of ProEquity Pursuant to Corporations Code § 1800(b)(5); 3) Accounting; 4) Books and Records Demand for Inspection under California Corporations Code § 1601; 5) In the Alternative to Involuntary Corporate Dissolution – Breach of Contract; 6) In the Alternative to Involuntary Corporate Dissolution – Breach of Implied Covenant of Good Faith and Fair Dealing.

Defendant moves to bifurcate the causes of action at trial and seeks the following sequence:

PHASE ONE: Jury Trial on Plaintiff's Fifth and Sixth Causes of Action (“In the Alternative to Dissolution, Breach of Contract” and “In the Alternative to Dissolution, Breach of Implied Contract of Good Faith and Fair Dealing”) to determine whether there exists an enforceable contract for the purchase of Plaintiff's minority shareholder interest in ProEquity Asset Management (the "Contract Claims"). If the pled contract for purchase of the minority interest of plaintiff is held enforceable, then the case proceeds to either performance or enforcement of the judgment. If the pled contract for purchase of the minority interest of plaintiff is found unenforceable, then the case proceeds to Phase Two, relating to the non-jury involuntary dissolution causes of action.

PHASE TWO: Plaintiff's First and Second Causes of Action seek involuntary dissolution of Defendant based on facts alleging violation of Corporation Code sections 1800 (b)(4) and (5) (‘Dissolution Claims”). Section 1800 actions are statutory “special proceedings” tried before the Court. While Section 1800 allows minority shareholders to file for involuntary dissolution of a company, Section 2000 provides a mechanism for majority shareholders to avoid this by purchasing the minority's shares at “fair value”. Section 2000 functions as a buyout alternative to avoid the court-ordered liquidation and 5 forced sales. Defendant elects this statutory process to “buy-out” the plaintiff at “fair value”.

Legal Principles

The Court is vested with the discretion to separate issues at trial. Code of Civil Procedure § 1048(b) provides: The court, in furtherance of convenience or to avoid prejudice, or when separate trials will be conducive to expedition and economy, may order a separate trial of any cause of action, including a cause of action asserted in a cross-complaint, or of any separate issue or of any number of causes of action or issues, preserving the right of trial by jury required by the Constitution or a statute of this state or of the United States. (emphasis added)

August 14, 2026 Dept. 9 Civil Tentative Rulings

Similarly, Code of Civil Procedure § 598 instructs that the court may order that the trial of any issue or any part thereof shall precede the trial of any other issue or any part thereof when the convenience of witnesses, the ends of justice, or the economy and efficiency of handling the litigation would be promoted.

Discussion

Defendant argues that trying the Contract Claims (the Fifth and Sixth Causes of Action) first promotes judicial economy because the most complex and expensive discovery and the most challenging-to-try elements are those that may be rendered moot after a decision on the more easily tried, less expensive to prepare contract issues. Bifurcation will promote judicial economy and efficiency by not wasting Court and party resources on the Dissolution Claims (the First and Second Causes of Action) if the trial on the Contract Claims resolves the case and if not, the remaining issues are handled without a jury.

Lastly, Defendant argues that bifurcation is appropriate here where doing so promotes efficiency and serves the ends of justice, which favors allowing the Parties and the Court to resolve the threshold contract question – which may fully resolve the dispute – before embarking on the complex, time-consuming, and expensive dissolution proceeding.

Plaintiff argues that the motion should be denied, as discovery is far from complete which is necessary to obtain the required substantial information needed to determine what evidence is relevant to each cause of action and thereby whether such evidence only need to be presented once in a single phase should trial be bifurcated. In addition, bifurcation will not promote judicial economy, as there is significant overlap between the two categories of cases. Both the Contract and Dissolution claims are based on the same facts, wrongdoings, and mismanagement, as well both claims have the same witnesses.

Bifurcation would increase legal fees, as the Parties would have to again engage in discovery, trial preparation, trial on the additional phases, law and motion hearings, case management conferences, and trial. While awaiting trial, Plaintiff is prejudiced as the value of his stock potentially diminishes daily. Plaintiff further argues that regardless of the outcome of the Contract Claims, Plaintiff will seek dissolution of Defendant which will require an adjudication of the Dissolution Claims.

Lastly, Defendant’s motion does not address Plaintiff’s Third or Fourth Causes of Action.

The Court finds that there is substantial overlap between the Contract Claims and Dissolution Claims wherein bifurcation would not promote the convenience of witnesses, the ends of justice, or the economy and efficiency of handling the litigation. Defendant’s motion to bifurcate is denied. // //

August 14, 2026 Dept. 9 Civil Tentative Rulings

TENTATIVE RULING #2: PLAINTIFF’S MOTION TO COMPEL FURTHER RESPONSES AND REQUEST FOR SANCTIONS IS DENIED. DEFENDANT’S MOTION TO BIFURCATE IS DENIED.

NO HEARING ON THIS MATTER WILL BE HELD UNLESS A REQUEST FOR ORAL ARGUMENT IS TRANSMITTED ELECTRONICALLY THROUGH THE COURT’S WEBSITE OR BY TELEPHONE TO THE COURT AT (530) 621-6551 BY 4:00 P.M. ON THE DAY THE TENTATIVE RULING IS ISSUED. CAL. RULE CT. 3.1308; LOCAL RULE 8.05.07; SEE ALSO LEWIS V. SUPERIOR COURT, 19 CAL.4TH 1232, 1247 (1999).

NOTICE TO ALL PARTIES OF A REQUEST FOR ORAL ARGUMENT AND THE GROUNDS UPON WHICH ARGUMENT IS BEING REQUESTED MUST BE MADE BY TELEPHONE OR IN PERSON BY 4:00 P.M. ON THE DAY THE TENTATIVE RULING IS ISSUED. CAL. RULE CT. 3.1308; EL DORADO COUNTY LOCAL RULE 8.05.07. PROOF OF SERVICE OF SAID NOTICE MUST BE FILED PRIOR TO OR AT THE HEARING.

LONG CAUSE HEARINGS MUST BE REQUESTED BY 4:00 P.M. ON THE DAY THE TENTATIVE RULING IS ISSUED AND THE PARTIES ARE TO PROVIDE THE COURT WITH THREE MUTUALLY AGREEABLE DATES ON FRIDAY AFTERNOONS AT 2:30 P.M. LONG CAUSE ORAL ARGUMENT REQUESTS WILL BE SET FOR HEARING ON ONE OF THE THREE MUTUALLY AGREEABLE DATES ON FRIDAY AFTERNOONS AT 2:30 P.M. THE COURT WILL ADVISE THE PARTIES OF THE LONG CAUSE HEARING DATE AND TIME BY 5:00 P.M. ON THE DAY THE TENTATIVE RULING IS ISSUED. PARTIES MAY PERSONALLY APPEAR AT THE HEARING.

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