Raymond Tesconi v. Dark Run Ventures, Inc., et al.

9:00 23CV411306 Raymond Tesconi Order on Defendant Tripathi’s 3 v. Motion to Expunge Lis Pendens Dark Run Ventures, Inc., et al. See Line 3 below for complete tentative ruling.

After the hearing, the Court will prepare and file the formal Order.

9:00 4

9:00 5

9:00 6

9:00 7

9:00 8

9:00 9

9:00 10

9:00 11

9:00 12

Line 3 Case Name: Raymond Tesconi v. Dark Run Ventures, Inc., et al. Case No.: 24CV435406 Defendant Ashish Tripathi (“Defendant” or “Tripathi”) moves under Code of Civil Procedure Sections 405.30 and 405.32 to expunge the Notice of Pendency of Action (Lis Pendens) recorded by Plaintiff Raymond Tesconi (“Plaintiff”) against the real property located at 4298 Othello Drive, Freemont, CA 94555, Alameda County Assessor’s Parcel Number 543-0413-007-00 (the “Property”) Notice of Motion (the “Motion”) at 1:27-2:4 (filed: Feb. 13, 2026). The Motion is made on the grounds that: (1) Plaintiff’s Complaint fails to state a real property claim against Defendant, and (2) Plaintiff cannot establish the probable validity of any real property claim against Defendant, who is a bona fide purchaser for value. Id. at 2:6-9.

The Motion came on for hearing on August 21, 2026, at 9:00 AM in Department 16. After reviewing all the papers and the record, and giving counsel for all parties the full and fair opportunity to be heard, the Court finds and rules as follows.

I. Fact Allegations & Procedural History

On March 7, 2018, Plaintiff Raymond Tesconi obtained a loan from Thurman Investments, Inc., executing a $350,000.00 promissory note, secured by a deed of trust on real property located at 4298 Othello Drive, Fremont, California. The loan was secured by a Deed of Trust dated March 2, 2018, recorded on March 7, 2018, as Document Number 2018047045 in the Official Records of Alameda County, California.

The note bore an interest rate of 11.603% per annum, with “Interest Only Payments of $3,384.20 - paid in monthly installments from May 1, 2018, up until April 30, 2023” (Compl. ¶ 19) and a balloon payment of the entire principal of $350,000.00 due and payable immediately at the maturity date of April 30, 2023. Interests in the loan were transferred to MERS Fund I and subsequently to Dark Run Ventures, Inc., entities controlled by Defendant William Robinson Stuart.

In mid to late 2019, Raymond Tesconi suffered a stroke. In the first quarter of 2020, Raymond Tesconi was diagnosed with Stage 4 Colon Cancer and was forced to undergo chemotherapy. William Robinson Stuart contacted Tesconi in April 2020, introduced himself as the managing member of MERS Fund I, and asked Tesconi to come to his office to sign documents; Stuart never explained the terms of these documents to Tesconi; Tesconi informed Stuart of his illnesses and current medical treatment that interfered with his faculties and ability to think clearly.

“Through the duration of the promissory note, Plaintiff states based on information and belief that he never missed a payment, and that he materially complied with each and every provision under the Second Deed of Trust.” (Compl. ¶ 22.) As the loan approached maturity, Tesconi located several ready, willing lenders prepared to loan money to pay off the junior loan, but that on several occasions, escrow would open and Stuart would find every opportunity to stonewall and thwart Tesconi’s efforts to complete the loan process.

In April 2022, Tesconi obtained a payoff quote from Dark Run Ventures, Inc. Stuart faxed over a document stating that Tesconi’s payoff was in the amount of $442,801.28. Tesconi alleges that “defendants charged over $80,109.83 in illegal interest payments at the unconscionable usurious rate of 20.5%” (Compl. ¶ 37.) By September 12, 2022, the payoff amount climbed to $461,598.03.

Dark Run Ventures, Inc. (“DRV”) recorded a Notice of Default against the subject property on or about January 23, 2023—roughly three months before the maturity of the loan. A Notice of Trustee Sale was recorded on or about June 8, 2023. Tescooni alerted defendants that he was approved for a $500,000 reverse mortgage loan—which would have easily satisfied the outstanding balance that defendants falsely and maliciously claimed that Tesconi owed; Tesconi requested a 60-day forbearance and asked defendants not to proceed with the non-judicial foreclosure trustee auction until the loan application process was completed.

“Tesconi was also preapproved for an emergency loan in the amount of $50,000; Plaintiff tendered $50,000 from those proceeds in good faith in order for the impending April 2, 2024, sale to be stopped ibid” (Compl. ¶ 56), but that “Defendants maliciously and in bad faith refused to consider the good faith offer; and in the absence of such bad faith, Plaintiff had the present ability to, and would have, cured the default and halted the sale” (id. ¶ 57).

The foreclosure sale occurred on April 2, 2024. Defendant Tripathi attended the non-judicial foreclosure auction and was the successful bidder. Tripathi purchased the property for the total sum of $1,220,100.00, paid in full via cashier’s checks. The deed states the amount of the unpaid debt together with costs was $604,715.15.

Tesconi filed this action (Case No. 24CV435406) on April 16, 2024—fourteen days after the April 2, 2024 trustee’s sale. Tesconi’s complaint here asserts ten causes of action, including wrongful foreclosure, quiet title, financial elder abuse, and declaratory relief.

The lis pendens was recorded May 10, 2024, at 1:13 PM in the Official Records of Alameda County. The trustee’s deed was dated May 22, 2024, and was not recorded until May 24, 2024, at 2:52 PM in the Official Records of Alameda County (Document No. 2024065120). Thus the lis pendens was recorded 14 days before the trustee’s deed was recorded.

The trustee’s deed states that a copy of the affidavit or declaration under Code of Civil Procedure Section 2015.5 delivered to the trustee by Tripathi as high bidder is attached as Exhibit A and incorporated therein; that affidavit is required to be attached

and recorded pursuant to Civil Code Section 2924m(d). However, Tripathi did not attach a copy of the Section 2924m affidavit to his moving papers here. Civil Code section 2924m(c)(1) requires that a prospective owner-occupant must submit the required affidavit to the trustee at the trustee’s sale or by 5 p.m. on the next business day following the trustee’s sale.

Here, the trustee’s sale occurred April 2, 2024; the latest the affidavit should have been accepted under section 2924m(c)(1) was April 3, 2024, before 5 p.m. Tesconi asserts that DRV and Stuart allowed Tripathi to submit the section 2924m affidavit 43 days after the sale and that the affidavit was executed May 15, 2024—43 days after the sale, in violation of the statute’s next-business-day deadline—and was deliberately concealed from the Court to create a false appearance of innocence.

A related unlawful detainer action was filed by Tripathi against Tesconi in Alameda Superior Court, case number 24CV078303. The Alameda Superior Court on December 12, 2024, granted Tripathi’s unopposed motion for summary judgment, finding that Defendant Raymond Tesconi has not opposed this motion and has therefore failed to raise triable issues of material fact as to the unlawful detainer action. Judgment was entered on December 16, 2024 in favor of Plaintiff and against Defendant. Reply at 7:18-20.

The Court of Appeal, First Appellate District, Division Three, filed an unpublished opinion on July 29, 2026, in case number A172456 (Alameda County Super. Ct. No. 24CV078303), affirming the judgment. The Court of Appeal affirmed “the trial court’s determination that Tripathi is a bona fide purchaser of the subject property entitled to the conclusive presumption of Civil Code section 2924, subdivision (c)” Supp. Req. for Jud. Notice at 2:26-28 & Ex. 5 at pp. 11-12. The appellate court found that Tripathi “purchased the property for $1,220,100.00 and, at the time of the sale, had no knowledge of any dispute regarding the foreclosure proceedings or the underlying loan” Supp. Req. for Jud. Notice, Ex. 5 at pp. 11-12.

On the timing issue, the Court of Appeal held that “the undisputed evidence, however, establishes that Tripathi submitted the successful bid on April 2, 2024, before either the May 10, 2024 recording of the lis pendens or his June 7, 2024, addition as a defendant in the wrongful foreclosure action” Supp. Req. for Jud. Notice, Ex. 5 at pp. 11- 12. And that “at the time Tesconi recorded his lis pendens, the trustee’s sale was complete and the statute provides no manner by which to abort the sale aside from a defect in the foreclosure process. Id., Ex. 5 at p.

13.

Here, in this case (No. 24CV435406), Tripathi filed his Motion to Expunge Lis Pendens on February 12, 2026, seeking expungement on two grounds: that Tesconi’s complaint fails to state a real property claim against Tripathi, and that Tesconi cannot establish the probable validity of any real property claim against Tripathi because Tripathi is a bona fide purchaser for value. Tesconi opposes the motion and requests mandatory attorney fees of $11,040.00 under Code of Civil Procedure section 405.38 if Tesconi prevails on this Motion.

II. Legal Standards

Under Code of Civil Procedure Section 405.31, a court shall order the lis pendens expunged if the court finds that the claimant has not established, by a preponderance of the evidence, the probable validity of the real property claim. (C.C.P. § 405.32.) The burden rests on the lis pendens claimant to prove by a preponderance probable validity, and the court weighs evidence beyond the pleadings, including declarations and documents.

Code of Civil Procedure Section 405.4 defines a real property claim to include causes of action in which a person seeks to establish a lien on or to recover possession of real property or to determine any right to or interest therein, including a real property claim based upon a lien. To qualify as a real property claim subject to lis pendens protection, the claim need not be framed solely in the language of property law; it suffices that the relief sought would, if successful, affect title to or right to possession of the property. (C.C.P. § 405.4.)

Probable validity means it is more likely than not that the claimant will obtain a judgment on the claim. (Code Civ. Proc., § 405.3.) The court must weigh the parties’ competing evidence; a mere prima facie showing is not enough. (Di Martini v. Superior Court (2024) 98 Cal.App.5th 1269.)

Moreover, Code of Civil Procedure Section 405.38 requires the court to award “the party prevailing” on this motion their “reasonable attorney’s fees and costs of making or opposing the motion” unless the court finds the other party acted with substantial justification or that other circumstances make the award unjust. (C.C.P. § 405.4) (emphasis added).

III. Analysis of the Motion

A. Tesconi’s Complaint states a real property claim.

Tesconi’s wrongful foreclosure claim directly seeks to rescind the non-judicial foreclosure and restore both title and, if necessary, possession to Tesconi. A successful wrongful foreclosure claim would set aside the April 2, 2024 trustee’s deed and reinstate Tesconi’s title. This is a real property claim within the meaning of Code of Civil Procedure Section 405.4. (Morris v. JPMorgan Chase Bank, N.A. (2022) 78 Cal.App.5th 279.)

Tesconi’s quiet title claim “seeks an order to invalidate the Non-Judicial Foreclosure Sale of April 2, 2024, pursuant to Trustee Sale # 132001-5; and an order decreeing that the Plaintiff Raymond Tesconi as the rightful owner of the subject property located at 4298 Othello Drive Fremont CA, 94555” Compl. ¶ 79. Quiet title is a direct real property action that seeks to determine rights to title. (§ 405.4.)

Tesconi’s financial elder abuse cause of action alleges that defendants took the property of Mr. Tesconi in the form of ownership to the subject property. Financial elder abuse qualifies as a real property claim where, if successful, it would affect title to the

subject property. (Newell v. Super. Ct. (2024) 107 Cal.App.5th 728.)

Tesconi’s declaratory relief cause of action alleges that an actual controversy exists between the parties regarding the legitimacy of the Non-Judicial Foreclosure Sale of the subject property conducted on April 2, 2024, seeks a determination that the sale was void, and asks for a court order canceling deeds recorded arising out of the April 2, 2024 sale.

Declaratory relief qualifies as a real property claim only when the declaration sought would itself determine rights to title or possession of the identified property. (Newell v. Super. Ct. (2024) 107 Cal.App.5th 728.) Here, the relief sought directly affects title. So this declaratory relief claim is a real property claim.

Accordingly, the Court finds that Tesconi’s complaint states real property claims within the meaning of Code of Civil Procedure section 405.4. The wrongful foreclosure and quiet title causes of action, together with the elder abuse and declaratory relief allegations, seek to determine Tesconi’s right to and interest in the property. Hence, the lis pendens is properly placed and may not be expunged on the ground that no real property claim exists.

B. Tripathi has not met his burden to establish by a preponderance of the evidence in this case that he is a bona fide purchaser.

A bona fide purchaser is one who takes for value, in good faith, and without notice of defects in title. (RNT Holdings, LLC v. United General Title Ins. Co. (2014) 230 Cal. App. 4thh 1289, 1296). Civil Code Section 2924 makes the recitals in a trustee’s deed conclusive only in favor of a bona fide purchaser for value. (Melendrez v. D & I Inv., Inc. (2005) 127 Cal.App.4th 1238, 1242.) The conclusive presumption under Civil Code Section 2924 protects against attacks on statutory notice compliance but does not insulate fraud that is chargeable to the purchaser. (Id.)

If a purchaser is a bona fide purchaser, equitable relief setting aside the sale, canceling the trustee’s deed, or quieting title against that purchaser is unavailable, and the trustor’s remedy is limited to damages. (Moeller v. Chun-Yen Lien (1994) 25 Cal.App.4th 822, 826.) But if the purchaser is not a bona fide purchaser, those equitable remedies remain available. (Orcilla v. Big Sur, Inc. (2016) 244 Cal.App.4th 982, 990.)

After carefully reviewing all the papers and the record, and in the broad exercise of its discretion, the Court finds that Tripathi has not established by a preponderance of the evidence that he is a bona fide purchaser for value without notice. This conclusion rests on several independent and cumulative evidentiary failures and factual disputes that fall outside the narrow notice-compliance issues addressed in the prior unlawful detainer proceedings.

First, the Court addresses the chronology of recording. The lis pendens was recorded on May 10, 2024, while the trustee’s deed was not recorded until May 24, 2024. A recorded lis pendens gives constructive notice from the time of recording, and rights adjudicated in the action relate back to that recording date. (Code Civ. Proc., § 405.24.) A

subsequent transferee who acquires or perfects an interest after the lis pendens is recorded is bound by that notice. (Deutsche Bank Nat’l Trust Co. v. McGurk (2012) 206 Cal.App.4th 201, 204.)

Tripathi argues that Civil Code Section 2924h(c) relates perfection of his interest back to the sale date of April 2, 2024, before the lis pendens was recorded. But this Court interprets Civil Code Section 2924h(c) to mean that its relation-back protection is not automatic and not available to a purchaser who is not a bona fide purchaser. While the text of Section 2924h(c) says when the trustee’s sale is deemed perfected,5 that does not mean that every purchaser automatically receives the substantive protections afforded to a bona fide purchaser under Section 2924 and related law. (See U.S.

Financial, L.P. v. McLitus (2016) 6 Cal. App. 5th Supp. 1, 3-4 [perfection of the trustee’s sale is distinct from perfection of title] & Residential Capital v. Cal-Western Reconveyance Corp. (2003) 108 Cal. App. 4th 807, 821-823 [holding that although the bidder’s bid had been accepted, discovery of a defect before issuance of trustee’s deed limited the bidder to restitution, observing that the bidder had not brought itself within the statutory scheme protecting the “sanctity of title of a bona fide purchaser[.]”).

Here, the trustee’s deed was dated approximately 50 days after the sale. So without a showing of the statutory conditions for section 2924h(c) relation back, the operative perfection date is the actual recordation date of May 24, 2024, which came after the lis pendens recording. This defeats the without-notice element of bona fide purchaser status.

Second, the Civil Code section 2924m owner-occupant affidavit issue undermines Tripathi’s position. Civil Code section 2924m requires a prospective owner-occupant affidavit to be submitted at the sale or by 5:00 p.m. on the next business day. (Civil Code § 2924m.) Compliance is substantive, not merely technical; failure to submit a compliant affidavit defeats the purchaser’s ability to establish the statutory owner-occupant eligibility that depends on that affidavit. (Applegate v. Carrington Foreclosure Servs., LLC (2025) 112 Cal.App.5th 356.) An untimely or noncompliant affidavit undermines, rather than supports, a claim to the protections flowing from section 2924m. (Id.)

Here, the trustee’s deed recites that the required affidavit was attached as Exhibit A thereto, but Tripathi did not produce the affidavit in his moving papers for this Motion. In stark contrast, Tesconi presents evidence that the affidavit was executed 43 days after the sale, in violation of the statute’s next-business-day deadline. Because the affidavit is central to any owner-occupant theory and Tripathi did not produce it here, the Court cannot presume timely compliance from the deed’s generic recital alone. This evidentiary gap weighs against Tripathi’s effort to prove bona fide purchaser status by preponderance of the evidence.

5 “For purposes of this subdivision, the trustee’s sale . . . shall be deemed perfected as of

8 a.m. on the actual ate of sale if the trustee’s deed is recorded within 21 calendar days after the sale, or the next business day following the 21st day if the county recorder in which the proper is located is closed on the 21st day.” (Civil Code § 2924h(c).)

Third, occupancy is materially disputed. Tripathi declares that he resides at 4298 Othello Drive, Fremont, CA 94555. But Tesconi counters that during the entire time that Tesconi lived directly across the street, he never observed Tripathi residing at 4298 Othello Drive, that he never saw Tripathi or his family move in or regularly come and go, and that he personally observed other families occupying his former home. Tesconi also presents address information showing addresses associated with Tripathi other than 4298 Othello Drive, including 1925 Barrymore Common through November 2024 and another Fremont address beginning in September 2024. Indeed, the trustee’s deed was recorded to and mailed to Ashish Tripathi at 1925 Barrymore CMN, Apt. W, Fremont, CA 94538— not the subject property address.

This conflict prevents the Court from finding, by a preponderance of the evidence in Tripathi’s favor, that Tripathi satisfied section 2924m’s owner-occupant predicates and acted in the good-faith, no-notice posture required of a bona fide purchaser. Combined with the missing affidavit and the Barrymore mailing address, the occupancy dispute cuts against Tripathi’s claimed statutory posture.

Fourth, Tesconi alleges that the straw purchaser, now known as Tripathi, was an agent of DRV and Stuart, and that any bad act alleged against the DRV Defendants is also imputed to Tripathi and that “Tripathi not only knew of the specific bad acts alleged interalia of DRV and Stuart, but be aided and abetted as he gave material assistance and comfort as posed as a straw purchaser at a foreclosure auction that was encapsulated by fraud and abuse” (Declaration of Raymond Tesconi in Opposition to Motion at¶ 39, at p. 10:8-10.)

Tesconi further alleges that the home was worth more than $2 million but sold for less than half its reasonable value and that “Stuart and DRV rigged the bidding to ensure that my residence of nearly three decades was sold to an inside investor for a fraction of the actual reasonable value” (Id. at ¶ 35, at p. 9:5-8.) While these allegations remain largely inferential and are not, standing alone, sufficient to pierce the Section 2924 conclusive presumption, they are relevant to the good-faith inquiry and add to the cumulative weight of evidence raising doubt about Tripathi’s claim to bona fide purchaser status.

Taking all this into account, and in the broad exercise of its discretion, the Court finds that Tripathi has not met his burden to establish by a preponderance that he is a bona fide purchaser for value without notice. The lis pendens timing, the absence of a demonstrated section 2924h(c) relation-back showing, the unresolved and evidentially significant section 2924m affidavit defect, and the disputed owner-occupancy evidence together defeat Tripathi’s claim to bona fide purchaser status on the present record.

C. Tesconi has established the probable validity of his real property claims.

On a motion to expunge a lis pendens, the lis pendens claimant bears the burden to establish by a preponderance of the evidence the probable validity of the real property claim. (C.C.P. § 405.32.) Probable validity means that it is more likely than not that the claimant will prevail on the merits of the real property claim. (C.C.P. § 405.3.) The court must weigh the parties’ competing evidence; a mere prima facie showing is not enough.

(Di Martini v. Superior Court (2024) 98 Cal.App.5th 1269.)

Tesconi has supported his Opposition with his own verified declaration, documentary evidence concerning his payment history and refinancing efforts, and detailed fact allegations of fraudulent conduct. Taking all this into account, and in the broad exercise of its discretion, the Court finds for purposes of resolving this Motion that Tesconi has established the probable validity of the following in this record.

On payment history and inflated payoff demands: Tesconi never missed a payment and he materially complied with each and every provision under the Second Deed of Trust. In April 2022, Tesconi received a payoff demand of $442,801.28 on a loan that originated at $350,000. Tesconi asserts that defendants charged over $80,109.83 in illegal interest payments at the unconscionable usurious rate of 20.5%. By September 2022, the payoff amount climbed to $461,598.03. This escalation supports a reasonable inference of inflated charges.

On obstruction of refinancing: Tesconi located several ready, willing lenders prepared to loan money to pay off the junior loan, yet on several occasions, escrow would open and Stuart would find every opportunity to stonewall and thwart Tesconi’s efforts to complete the loan process. Tesconi asserts that he alerted defendants that he was approved for a $500,000 reverse mortgage loan—which would have easily satisfied the outstanding balance and requested forbearance, yet defendants proceeded with the sale anyway. Tesconi also asserts that he was preapproved for an emergency loan in the amount of $50,000; Plaintiff tendered $50,000 from those proceeds in good faith in order for the impending April 2, 2024, sale to be stopped, but that Defendants maliciously and in bad faith refused to consider the good faith offer.

On financial elder abuse: Tesconi suffered a stroke and was diagnosed with Stage 4 Colon Cancer requiring chemotherapy. Tesconi alleges that Stuart contacted him in April 2020, introduced himself as the managing member of MERS Fund I, asked Tesconi to come to his office to sign documents, never explained the terms, and was informed by Tesconi of his illnesses and current medical treatment that interfered with his faculties and ability to think clearly. Against this backdrop of clear vulnerability of a sick old man, and the pattern of obstructed refinancing efforts, the Court finds that Tesconi presents a credible narrative of a senior citizen in declining health being systematically denied access to the financing he repeatedly sought, culminating in a forced sale.

On property valuation: Tesconi asserts the home was worth more than $2 million but sold for $1,220,100. The disparity, combined with the other evidence of fraud and obstruction, is probative of the trustee’s sale being an exercise in systematic undervaluation.

Moreover, for all the reasons the Court explained in detail above, the Court has found that Tripathi has not established in this case that he is a bona fide purchaser— which removes the primary barrier to equitable relief, thereby substantially strengthening Tesconi’s probable validity showing.

Taking all this into account, and in the broad exercise of its discretion, the Court finds, for the purposes of resolving this Motion, that Tesconi has established by a preponderance of the evidence the probable validity of his real property claims. The documentary evidence of inflated payoff demands, the specific instances of obstruction of refinancing, the verified tender attempts, the elder abuse context, and the circumstantial evidence of Tripathi’s non-occupancy together support that it is more likely than not that Tesconi will prevail on his wrongful foreclosure, quiet title, and related claims.

D. Issue preclusion does not bar litigation in this case over whether Tripathi is a bona fide purchaser.

Issue preclusion applies only if the issue is identical to one decided in the prior proceeding, the prior decision is final and on the merits, the issue was actually litigated and necessarily decided, and the party against whom preclusion is asserted was a party or in privity with a party to the prior proceeding.

In the section 1161a context, the preclusive effect of an unlawful detainer judgment is narrow because that proceeding permits only a limited examination of title, focused on whether the purchaser acquired the property at a regularly conducted sale and duly perfected title. (Struiksma v. Ocwen Loan Servicing, LLC (2021) 66 Cal.App.5th 546.) A prior section 1161a judgment precludes only issues directly connected with the conduct of the foreclosure sale and actually adjudicated there. (Malkoskie v. Option One Mortg. Corp. (2010) 188 Cal.App.4th 968, 974.)

To be sure, the parties to the prior unlawful detainer proceeding are identical to the parties in the present action. The same property was at issue. The prior judgment was affirmed on appeal by the Court of Appeal on July 29, 2026. And that prior determination is final.

This Court recognizes and respects that the Court of Appeal in the unlawful detainer action held that Tripathi is a bona fide purchaser entitled to the conclusive presumption of Civil Code section 2924, subdivision (c), and found that Tripathi purchased the property with no knowledge of any dispute regarding the foreclosure proceedings. The appellate opinion’s affirmance of a specific bona-fide-purchaser determination satisfies the actually-litigated element as to bona-fide-purchaser status on the narrow ground of statutory notice compliance under Civil Code section 2924(c). That determination is essential to the unlawful-detainer judgment insofar as Tesconi’s attack in that proceeding concerned Tripathi’s right to possession after the trustee’s sale.

But the scope of that preclusion is narrow. Civil Code section 2924(c) is conclusive only as to statutory notice compliance, specifically whether the recitals in the trustee’s deed regarding mailing, publication, and posting of the Notice of Default and Notice of Sale were satisfied. A section 1161a judgment precludes only issues directly connected with the conduct of the foreclosure sale and actually adjudicated there. (Struiksma v. Ocwen Loan Servicing, LLC (2021) 66 Cal.App.5th 546; Malkoskie v. Option One Mortg. Corp. (2010) 188 Cal.App.4th 968, 974.)

In this case, the Court finds that collateral estoppel bars Tesconi from relitigating whether the statutory notice requirements under Civil Code section 2924(c) were satisfied and whether Tripathi had notice of irregularities in those specific statutory procedures at the time of sale. But the Court further finds that this preclusion does not extend to the separate elements of bona fide purchaser status that were not necessarily decided in the unlawful detainer proceeding. Specifically, the prior proceeding did not address or decide the timing of the lis pendens recording relative to the trustee’s deed recording, the timeliness and validity of the Civil Code section 2924m owner-occupant affidavit, the disputed occupancy evidence, or the availability of Civil Code section 2924h(c) relationback.

These issues fall outside the limited title inquiry permitted in an unlawful detainer action, and thus were not actually litigated or necessarily decided in the prior proceeding.

Importantly, the Court’s finding above that Tripathi has not established his bona fide purchaser status here rests on these other elements—lis pendens timing, section 2924m compliance, occupancy disputes, and lack of relation-back—not on the statutory notice-compliance issues that were decided in the unlawful detainer proceeding. This Court’s (a) collateral estoppel finding on notice compliance and (b) independent no-bonafide-purchaser finding based on these other elements are therefore consistent and complementary, not contradictory.

Moreover, Tesconi’s present claims include substantial allegations of fraud, elder abuse, and irregularities outside the pure notice-compliance scope adjudicated in the unlawful detainer case. Accordingly, the collateral estoppel limitation does not independently require expungement under section 405.32 because Tesconi’s wrongful foreclosure, fraud, and elder abuse allegations—many of which go to conduct outside the pure notice-compliance scope of the UD judgment—establish that probable validity is shown despite the narrow collateral estoppel bar on notice-compliance relitigation.

E. In the exercise of its discretion, the Court does not require Tesconi to post an undertaking here.

Code of Civil Procedure section 405.34 provides that if the court does not expunge the lis pendens, the court may, in its discretion, require the plaintiff to post an undertaking to indemnify the defendant for any damages caused by the preservation of the lis pendens.

This undertaking requirement is discretionary, not mandatory. If imposed, the amount of the undertaking should be reasonable and proportionate to the defendant’s anticipated harm if the lis pendens is ultimately found to be invalid. The amount is limited to damages proximately caused by maintenance of the notice itself. (C.C.P. § 405.34.) Cognizable categories include interest paid on encumbering debt, lost investment return or opportunity cost on the purchase money, real property taxes, and resale costs. (CMSH Co., Inc. v. Antelope Dev., Inc. (1990) 223 Cal.App.3d 174, 176.)

Here, where the Court denies Tripathi’s Motion to expunge on its merits and finds that Tesconi establishes the probable validity of his real property claims, the primary purpose of an undertaking—to protect against the burdens of an invalid lien—is

substantially diminished. The lis pendens here is likely valid, not speculative.

As explained in detail above, the Court has found that Tesconi presents substantial evidence supporting his real property claims, including documentary evidence of payment history, inflated payoff demands, obstructed refinancing efforts, tender attempts, and elder abuse. Such evidence supports that it is more likely than not that Tesconi will prevail on his wrongful foreclosure and quiet title claims at trial.

Indeed, an undertaking is most appropriate where the validity of the underlying claim is questionable or where the defendant demonstrates specific, quantifiable harm from the maintenance of the lis pendens that outweighs the claimant’s interest in preserving the status quo. Neither condition is satisfied here. The Court here finds that: (1) Tesconi has established probable validity of his claims by a preponderance of the evidence, and (2) Tripathi has not submitted detailed evidence of specific carrying costs or damages that would result from the lis pendens remaining in place pending the upcoming jury trial set to begin in this case on May 5, 2027.

Taking all this into account, and in the broad exercise of its discretion, the Court here declines to require Tesconi to post an undertaking.

F. As the prevailing party on this Motion, Tesconi is entitled to his reasonable attorneys’ fees in opposing this Motion.

Code of Civil Procedure section 405.38 mandates an award of reasonable attorney fees and costs to the prevailing party on a motion to expunge a lis pendens unless the Court finds that one of these statutory exceptions exist: (1) the other party acted with substantial justification or (2) that other circumstances make imposition of fees unjust. (C.C.P. § 405.38). As the plain text of this statutory provision enacted by our Legislature is the “court shall,” not may, this award is mandatory unless one of those two statutory exceptions are present. (C.C.P. § 405.38) & (Shoker v. Superior Court (2022) 81 Cal.App.5th 271) (same).

The party who successfully defeats a motion to expunge and thereby preserves the lis pendens is the prevailing party for purposes of Section 405.38. (J&A Mash & Barrel, LLC v. Super. Ct. (2022) 74 Cal.App.5th 1.) Because the Court has denied Tripathi’s Motion to expunge on its merits, the Court now finds that Tesconi is the prevailing party on this Motion.

Having found that Tesconi is the prevailing party on the Motion, under Section 405.38 the burden now shifts to Tripathi to show that one of the two statutory exceptions apply, e.g., that he “acted with substantial justification” in bringing this Motion. (C.C.P. § 405.38) & (Castro v. Superior Court (2004) 116 Cal.App.4th 1010, 1014) (same). Substantial justification means a position that is clearly reasonable in both law and fact. (Castro, 116 Cal. App. 4th at 1014).

Here, Tripathi argues that he acted with substantial justification his motion because his Motion rested on an undisputed timeline and appellate authority on his bona

fide purchaser status. But this characterization does not satisfy Tripathi’s burden to show that his position was clearly reasonable in both law and fact. This Court has found above that Tripathi failed to establish bona fide purchaser status on the present record due to multiple evidentiary failures, including the lis pendens timing, the missing section 2924m affidavit, disputed occupancy, and the lack of relation-back showing. And where, as here, the Court denies the Motion to expunge on the merits, Tripathi’s reliance on his own characterization of authorities does not establish substantial justification.

Tripathi also argues that Tesconi is relitigating a bona fide purchaser issue already decided against Tesconi on appeal in the unlawful detainer action. While the Court has found above that collateral estoppel precludes relitigation of bona-fide-purchaser status on notice-compliance grounds under Civil Code section 2924(c), the Court also found that this preclusion is narrow and that Tesconi’s present claims in this case include substantial allegations of fraud, elder abuse, and irregularities outside the pure notice-compliance scope already adjudicated in the unlawful detainer case.

The collateral-estoppel argument, while based on a validly adjudicated prior determination, does not transform the present Motion into one that was clearly reasonable in law and fact when the Motion’s defects on probable validity and other issues are considered. For instance, the prior unlawful detainer proceeding did not address or decide the timing of the lis pendens recording relative to the trustee’s deed recording, the timeliness of the section 2924m affidavit, the occupancy disputes, or the availability of section 2924h(c) relation-back—all of which are central to the Court’s findings and rulings in this Motion.

Accordingly, the Court finds that Tripathi has not carried his burden to establish the substantial-justification exception of Section 405.38. Likewise, Tripathi has not shown any other circumstances that would render the award of fees unjust here to satisfy the second statutory exception.

Importantly, Section 405.38 does not confer general discretion to this Court to withhold fees once a party prevails. Absent proof of one of two statutory exceptions, the award is required. (Shoker v. Superior Court (2022) 81 Cal.App.5th 271.) And Tripathi has not established either of the two statutory exceptions here.

In this case, Tesconi requests $11,040.00 in attorney fees under Section 405.38 as the prevailing party. (Notice of Opp. & Counter-Request for Attorneys’ Fees Per C.C.P. § 405.38 at 1:28-2:2) (filed: Aug. 10, 2026). And as set forth in detail in the Supporting Declaration of his Plaintiff’s lawyer Neil E. Opdahl-Lopez, the $11,040.00 award sought represents 18.4 hours of work, at counsel’s reasonable hourly rate of $600.00, incurred in opposing Defendant’s Motion and related ex parte proceedings directly related to this Motion. (Opdahl-Lopez Decl. at ¶¶ 5-12).

Specifically, this 18.4 hours of work included review of Tripathi’s moving papers, declarations, exhibits, and authorities; legal research on lis pendens, probable validity, wrongful foreclosure, fraud, bona-fide-purchaser status, financial elder abuse, aiding and abetting, and related authorities; review, selection, and compilation of supporting exhibits; conferences with Tesconi and factual development; preparation and revision of Tesconi’s 13-page supporting declaration; preparation and revision of the opposition; review and opposition to Tripathi’s ex parte application to advance the hearing; review of Tripathi’s reply and authorities; preparation for hearing

and oral argument; and appearance at the hearing. (Id. at ¶ 6). The work was evidenceintensive because Tesconi was required to establish the probable validity of his real property claims by a preponderance of the evidence. (Id. at ¶ 7). This 18.4 hours of work includes 1.5 hours for work opposing Tripathi’s ex parte application (id., Appendix of Time Spent), which the Court finds is properly recoverable here because Tripathi sought ex parte relief to advance the hearing on this Motion, requiring Tesconi and his counsel to respond on an expedited basis.

In light of this detailed supporting evidence provided in the Opdahl-Lopez Declaration, the Court, in the broad exercise of it is discretion, finds that the 18.4 hours sought were reasonably incurred by Plaintiff’s counsel in opposing the Motion. This Opposition required factual development, legal research across multiple theories, drafting a substantial client declaration, exhibit assembly, reply review, and hearing preparation.

Moreover, in the broad exercise of its discretion, the Court further finds that the hourly rate of $600 sought for attorney Opdahl-Lopez’s time is reasonable and consistent with rates of similarly-situated lawyers in the relevant market for sophisticated real estate and foreclosure litigation.

The Court further notes that in his reply papers, Tripathi submitted no evidence in any reply declaration, no competing market-rate evidence, and no item-by-item challenge to the hours or hourly rate sought by Tesconi’s lawyer here.

As the Court finds the 18.4 hours sought was reasonably incurred in opposing the Motion, and as the Court finds the $600.00 hourly rate sought is reasonable, the Court finds the $11.040.00 sought in attorneys’ fees is reasonable here.

As Section 405.38 requires the Court under these circumstances to award Tesconi as the prevailing party his reasonable attorneys’ fees in opposing the Motion, and as the Court finds that the $11,040.0o sought in attorneys’ fees is reasonable here, the Court under Section 405.38 now awards Tesconi $11,040.00 for his reasonable attorney’s fees for this Motion. Specifically, the Court ORDERS Tripathi to pay Tesconi $11,040.00 within 30 days of today for Tesconi’s reasonable attorneys’ fees for this Motion.

IV. Conclusion & Order

Accordingly, in the broad exercise of its discretion, the Court ORDERS that:

• Defendant Ashish Tripathi’s Motion to Expunge Lis Pendens is DENIED in its entirety.

• The Lis Pendens recorded May 10, 2024, in the Official Records of Alameda County remains in effect.

• Plaintiff Raymond Tesconi is awarded his reasonable attorney fees of $11,040.00 for this Motion under Code of Civil Procedure Section 405.38, payable by Defendant Ashish Tripathi within 30 days of today.

Moreover, the Court respectfully puts Defendant Ashish Tripathi on NOTICE that failure to comply with this ORDER within 30 days to today may result in further escalating monetary sanctions and non-monetary sanctions including issue, evidentiary, and terminating sanctions.

SO ORDERED.

Date: August 21, 2026

Vincent I. Parrett Judge of the Superior Court of California, County of Santa Clara

31