Baum v. Milks CA2/6

Filed 4/20/21 Baum v. Milks CA2/6 NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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 SIX

DWIGHT J. BAUM et al., 2d Civ. No. B298410 (Super. Ct. No. 17CV00153) Plaintiffs and Respondents, (Santa Barbara County)

v.

WILLIAM MILKS,

Defendant and Appellant.

William Milks appeals from an order denying his motion to vacate entry of a sister-state (Nevada) judgment. He contends the Santa Barbara County Superior Court erred when it denied his motion because the Nevada judgment is void. We affirm. FACTUAL AND PROCEDURAL HISTORY Arbitration and Nevada Court Proceedings Milks, Steven White, and Joel Quaid (collectively, “Defendants”) are managers of Affirmed Technologies, LLC (Affirmed). Dwight Baum and other plaintiffs (collectively, “Plaintiffs”) are shareholders of Affirmed.

Plaintiffs brought a shareholders’ action against Defendants in Nevada district court. They alleged 11 causes of action, claiming that Defendants misused Affirmed’s funds. Plaintiffs sued White “individually, and in his capacity as member and manager of Affirmed” and sued Milks and Quaid in their “capacity as manager[s] of Affirmed.” The parties proceeded to arbitration.1 In June 2015, the arbitrator found in favor of Plaintiffs on two derivative claims brought on behalf of Affirmed against White and awarded damages to Affirmed. The arbitrator also found that Quaid and Milks mismanaged Affirmed’s assets in violation of Affirmed’s Operating Agreement. The arbitrator awarded Plaintiffs $409,656 in attorney fees and $26,951 in costs “to be recovered from Respondents.” The arbitrator also ordered the arbitration fees to be divided equally between the parties. Plaintiffs moved to confirm the arbitration award in the Nevada district court, and Defendants moved to vacate it. The district court upheld the substantive ruling of the arbitrator. The district court noted that “Respondents” in the arbitration action included not only White, Quaid, and Milks, but also Affirmed as a “nominal respondent.” The court remanded the case to the arbitrator to clarify which “Respondents” were responsible for the attorney fees, costs, and expenses. On remand, the arbitrator clarified that the attorney fees, costs, and expenses were intended to “be awarded jointly and severally against White, Quaid and Milks as the true