Phone: 619-432-5145
Phone: 619-432-5145
![FRAUD I CIVIL LITIGATION I FRAUD LITIGATION I BUSINESS LITIGATION I BREACH OF CONTRACT – $ 4.3 Million Verdict in favor of Cannabis Investor for Contractual Fraud - A CASE STUDY September 24, 2020 On November 18, 2016 cannabis investor and fraud victim, Mr. Sergio Tellez, sued longtime cannabis businessman and activist, Mr. James Shaw, for breach of contract and fraudulently inducement to invest in his marijuana business. Per the contractual fraud complaint, the parties executed a written management transfer contract which was induced by fraud, specifically undue influence and concealment of material facts. Per the terms of the contract, Tellez would invest $2 million into Shaw’s medical marijuana dispensary and cultivation center, in exchange Shaw would give operational control to Tellez. In breach of the parties’ contract, once the new facility was constructed Shaw failed to transfer operations to the fraud victim and Tellez was removed from the facility. Following a prolonged jury trial, the jury found in favor of the plaintiff in the amount of $4,300,000. The jury verdict included damages for breach of contract, constructive fraud, breach of the covenant of good faith and fair dealing and punitive damages. - Sergio Tellez dba Specialized Development; Palo Capital and Consulting, LLC; Polo Capital and Consulting, LP; and California Institute of Cannabis Inc. v. James Shaw; Arts District Patients' Collective, Inc. dba Arts District Healing Center; Art District Unity Center, Inc.; and Does 1 through 50, inclusive; Case: BC641097; Verdict: reached 12/17/2018, Status: currently on appeal For additional articles discussing fraud, please see links below: • CALIFORNIA INSURANCE BAD FAITH I FRAUD I CIVIL LITIGATION – When Does Insurance Fraud And Insurance Bad-Faith Overlap?: http://dianalegal.com/california-insurance-bad-faith-i-fraud-i-civil-litigation-when-does-insurance-fraud-and-insurance-bad-faith-overlap/ • CALIFORNIA INSURANCE BAD FAITH I CIVIL LITIGATION – Do I Have A Bad Faith Insurance Claim? http://dianalegal.com/california-insurance-bad-faith-i-civil-litigation-do-i-have-a-bad-faith-insurance-claim/ • CALIFORNIA INSURANCE BAD FAITH I PERSONAL INJURY I CIVIL LITIGATION – INSURANCE BAD FAITH http://dianalegal.com/CALIFORNIA-INSURANCE-BAD-FAITH-I-PERSONAL-INJURY-I-CIVIL-LITIGATION-INSURANCE-BAD-FAITH/ • “What is Insurance Bad Faith”, “What is a Bad Faith Insurance Claim”, “Common Conduct that Gives Rise to an Insurance Bad Faith Claim” and “What Damages are available in Insurance Bad Faith claims” are linked herein: CALIFORNIA INSURANCE BAD FAITH I PERSONAL INJURY I CIVIL LITIGATION – What Is A Bad Faith Insurance Claim? http://dianalegal.com/california-insurance-bad-faith-i-personal-injury-i-civil-litigation-what-is-a-bad-faith-insurance-claim/ • CALIFORNIA INSURANCE BAD FAITH I PERSONAL INJURY I VERDICT & SETTLEMENTS – $2,006,000 Insurance Bad Faith: Unreasonable Failure to Disclose Policy Limits, Failure to Make Prompt & Fair Settlement: http://dianalegal.com/california-insurance-bad-faith-i-personal-injury-i-verdict-settlements-2006000-insurance-bad-faith-unreasonable-failure-to-disclose-policy-limits-failure-to-make-prompt-fair-settlem/ To better understand what types of Damages in fraud and breach of contract cases, see the links below: • What are Compensatory Damages? http://dianalegal.com/personal-injury-personal-injury-damages-compensatory-damages/ • Compensatory Damages in a Personal Injury Action: http://dianalegal.com/personal-injury-damages-compensatory-damages-for-personal-injuries/ • What Are Punitive Damages? http://dianalegal.com/fraud-i-damages-i-civil-litigation-what-are-punitive-damages/ • A discussion on the differences between punitive damages and compensatory damages: http://dianalegal.com/fraud-i-damages-i-civil-litigation-punitive-damages-vs-compensatory-damages/ Articles discussing fiduciary duties, otherwise duties owed to investors, please see the listed below: • FRAUD I BREACH OF FIDUCIARY DUTY – What Fiduciary Duties Are Owed? A Fiduciary Owes The Duty Of Undivided Loyalty. What Happens If A Fiduciary Breaches Their Duty Of Undivided Loyalty? http://dianalegal.com/fraud-i-breach-of-fiduciary-duty-what-fiduciary-duties-are-owed-a-fiduciary-owes-the-duty-of-undivided-loyalty-what-happens-if-a-fiduciary-breaches-their-duty-of-undivided-loyalty/ • FRAUD I BREACH OF FIDUCIARY DUTY – What Fiduciary Duties Are Owed? A Fiduciary Owes The Duty To Use Reasonable Care. What Happens If A Fiduciary Breaches Their Duty To Use Reasonable Care? http://dianalegal.com/fraud-i-breach-of-fiduciary-duty-what-fiduciary-duties-are-owed-a-fiduciary-owes-the-duty-to-use-reasonable-care-what-happens-if-a-fiduciary-breaches-their-duty-to-use-reasonable-care/ • FRAUD I BREACH OF FIDUCIARY DUTY – What Is A Fiduciary Duty? What Does A Breach Of Fiduciary Duty Mean? What Is A Fiduciary? http://dianalegal.com/fraud-i-breach-of-fiduciary-duty-what-is-a-fiduciary-duty-what-does-a-breach-of-fiduciary-duty-mean-what-is-a-fiduciary/ Our other articles discussing fraud in California and fraud in general, links are included below: • FRAUD – What Constitutes Fraud In California? What Does A Cause Of Action For Fraud By Intentional Misrepresentation In California Mean? http://dianalegal.com/fraud-what-constitutes-fraud-in-california-what-does-a-cause-of-action-for-fraud-by-intentional-misrepresentation-in-california-mean/ • FRAUD – WHAT CONSTITUTES FRAUD IN CALIFORNIA? WHAT DOES A CAUSE OF ACTION FOR FRAUD BY FALSE PROMISE IN CALIFORNIA MEAN?: http://dianalegal.com/FRAUD-WHAT-CONSTITUTES-FRAUD-IN-CALIFORNIA-WHAT-DOES-A-CAUSE-OF-ACTION-FOR-FRAUD-BY-FALSE-PROMISE-IN-CALIFORNIA-MEAN/ • FRAUD VIA FALSE PROMISE OR PROMISSORY FRAUD: http://dianalegal.com/fraud-legal-liability-for-fraud-civil-tort-for-fraud-via-false-promise-or-promissory-fraud/ • INTENTIONAL FRAUD AND DECEIT is embedded herein: http://dianalegal.com/fraud-legal-liability-for-fraud-civil-tort-for-intentional-fraud-and-deceit/ • CONVERSION OR BREACH OF FIDUCIARY DUTY http://dianalegal.com/fraud-legal-liability-for-fraud-civil-tort-for-conversion-or-breach-of-fiduciary-duty/ • FRAUDULENT CONCEALMENT OR CONCEALMENT FRAUD: http://dianalegal.com/fraud-legal-liability-for-fraud-civil-tort-for-fraudulent-concealment-or-concealment-fraud/ • FRAUD – What Constitutes Fraud In California? What Does A Cause Of Action For Fraud By Concealment In California Mean? http://dianalegal.com/fraud-what-constitutes-fraud-in-california-what-does-a-cause-of-action-for-fraud-by-concealment-in-california-mean/ • FRAUD – Legal Liability For Fraud – Civil Tort For Conversion Or Breach Of Fiduciary Duty: http://dianalegal.com/fraud-legal-liability-for-fraud-civil-tort-for-conversion-or-breach-of-fiduciary-duty/ • CONSTRUCTIVE FRAUD OR NEGLIGENT MISREPRESENTATION is embedded herein: http://dianalegal.com/fraud-legal-liability-for-fraud-civil-tort-for-constructive-fraud-or-negligent-misrepresentation/ If you have questions regarding a potential breach of contract claim or fraud matter, we invite you to contact Adjadj Legal Group at 619-432-5145 for a free consultation with one of our experienced Fraud attorneys and business litigation Lawyers. 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FRAUD I CIVIL LITIGATION I FRAUD LITIGATION I BUSINESS LITIGATION I BREACH OF CONTRACT – $ 4.3 Million Verdict in favor of Cannabis Investor for Contractual Fraud – A CASE STUDY
By: Diana Adjadj, Esq.
September 24, 2020
Contract fraud victim alleges being wrongfully ousted from facility by contractor and awarded punitive damages following a jury trial.
On November 18, 2016 cannabis investor and fraud victim, John Doe, sued longtime cannabis businessman and activist, Roe Doe, for breach of contract and fraudulently inducement to invest in his marijuana business. Per the contractual fraud complaint, the parties executed a written management transfer contract which was induced by fraud, specifically undue influence and concealment of material facts. Per the terms of the contract, John Doe would invest $2 million into Roe Doe’s medical marijuana dispensary and cultivation center, in exchange Roe would give operational control to John. In breach of the parties’ contract, once the new facility was constructed Roe failed to transfer operations to the fraud victim and John was removed from the facility. Following a prolonged jury trial, the jury found in favor of the plaintiff in the amount of $4,300,000. The jury verdict included damages for breach of contract, constructive fraud, breach of the covenant of good faith and fair dealing and punitive damages.
For additional articles discussing fraud:
To better understand what types of Damages in fraud and breach of contract cases:
Articles discussing fiduciary duties, otherwise duties owed to investors:
Other articles discussing fraud in California and fraud in general :
If you have questions regarding a potential breach of contract claim or fraud matter, we invite you to contact Adjadj Legal Group at 619-432-5145 for a free consultation with one of our experienced fraud attorneys and business litigation lawyers.