Markowitz v. LPL Financial CA2/2

Filed 10/1/14 Markowitz v. LPL Financial CA2/2

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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 SECOND APPELLATE DISTRICT DIVISION TWO

BRAD MARKOWITZ, B253313

Plaintiff and Appellant, (Los Angeles County Super. Ct. No. BC423690) v.

LPL FINANCIAL, LLC,

Defendant and Respondent.

APPEAL from a judgment of the Superior Court of Los Angeles County. Rita Miller, Judge. Affirmed.

Pick & Boydston and Brian D. Boydston for Plaintiff and Appellant.

Markun Zusman Freniere & Compton, David S. Markun, Edward S. Zusman, and Kevin K. Eng for Defendant and Respondent.

Plaintiff and appellant Brad Markowitz (plaintiff) appeals from the judgment entered in favor of defendant and respondent LPL Financial, LLC (LPL) after the trial court sustained, without leave to amend, LPL’s demurrer to all of the causes of action asserted against it in plaintiff’s third amended complaint. We affirm the judgment. BACKGROUND Factual background Plaintiff was the victim of a fraudulent scheme masterminded by Michael E. McCready, a financial representative of several national brokerage firms, including LPL and SmithBarney (now defendant Citigroup Global Markets, Inc.). McCready was a registered SmithBarney broker from 2002 until August 2004 and was a registered LPL broker from August 2004 to August 2005. Plaintiff’s relationship with McCready began in late 2003 or early 2004, while McCready was a broker at SmithBarney. At that time, Plaintiff gave McCready control over all of his finances, including several annuities with ING USA (ING), which were managed by McCready through SmithBarney. In early 2004, McCready recommended that plaintiff refinance his home with CitiMortgage, a division of Citicorp, which also owned SmithBarney. Plaintiff heeded McCready’s advice and in June 2004 refinanced the first mortgage on his home through McCready and SmithBarney with CitiMortgage. Unbeknownst to plaintiff, McReady obtained a second mortgage on plaintiff’s home with a $260,000 limit and diverted funds from the second mortgage to himself. McCready became an LPL registered representative in August 2004 but continued to manage plaintiff’s ING annuities through SmithBarney. In 2005, McCready liquidated plaintiff’s ING annuities and diverted the proceeds to himself in three separate transactions. In February 2005, plaintiff caused a portion of the ING annuities to be liquidated, at McCready’s request. McCready told plaintiff that the money was being “rolled over” to a new investment. Plaintiff gave McCready a check issued by ING through