18 19 20 21 22 23 24 25 26 aporay 19 PHS wT THE HONORABLE STEVEN GONZALEZ CLERK Hearing: Friday, June 6, 2008 WA. (Without Oral Argument) IN THE SUPERIOR COURT OF WASHINGTON STATE FOR KING COUNTY CHRIS CORNELL, Plaintiff, vs. NO. 06-2-24639-0 SEA | Washington Professional Service TO THE GEORGE DEFENDANTS’ Corporation; LEE E. JOHNSON; MOTION FOR PARTIAL SUMMARY JANET A. GEORGE; and JANET A. JUDGMENT RE: ADVANCE, | GEORGE INC. P.S., a Washington ) ) ) ) ) VOLDAL, WARTELLE &CO.,P.S.,a ) — PLAINTIFE’S OPPOSITION TO ) ) ) ) Professional Service Corporation; ) ) ) Defendants. Eee eee eed, L RELIEF REQUESTED Plaintiff Chris Comell hereby requests that this Court deny the George Defendants’ | Motion For Partial Summary Judgment regarding the $750,000 advance. Mr. Comell’s standard of care expert, Neal Hersh, testified in his declaration that Ms. George’s failure to adequately conduct discovery or hire a forensic accountant was a breach of the standard of care and resulted in substantial loss to Mr. Comell. Mr. Hersh’s declaration creates a general issue of material fact for trial. Mr. Comell’s accounting expert testified in her Geclaration to the financial support for the claim, Moreover the George Defendants’ motion relics on a declaration of Lee Johnson which has been or will be stricken from the record. JOHNSON | FLORA PLTE’S OPP. TO GEORGE DEFTS’ MOTION eta setctea nicht eave Gob | FOR PARTIAL S. J. RE: ADVANCE -1 Seatle, WA9B121 0 RI Gl N A L (0) 208.086.5566 (9 208.682.0675RoR Seaorxnroa " 12 13 14 15 16 7 19 20 24 22 23 24 25 26 IL, STATEMENT OF FACTS ‘As part of the record recording process, Mr. Comell periodically receives advances for recording pursuant to recording contracts. He or someone on his behalf initiates the advance when recording has begun. According to Mr, Comell’s former business manager, Lee Johnson, Mr. Comell’s attomey, Peter Patemo, initiated an advance in 2000 for the recording of Mr. Comell's second solo album. (Declaration of Mark Jolson in Support of Plaintiffs Opposition to George Defendants' Motions for Summary Judgment "Johnson Opp. Decl.", Ex. 9, p. 255:15-256:25) The $750,000 advance was deposited by Mr. Johnson into abank account that was ultimately subject to the property settlement agreement and marital community property split of assets between Mr. Comell and Ms. Silver. (Id.) The George defendants’ claim in their motion that it is “undisputed that Comell was told about the advance in 2000.” (Defendants’ motion at 2) The George defendants provide no citation for || their claim that this is not disputed but indeed it is disputed by Mr. Cornell. When asked if hhe had ever seen the letter requesting the $750,000 advance, Mr. Comell said no and that it is something that he would have remembered getting a copy of. (Id., Ex. 3, p. 373:3-22) He further testified that he never spoke with his then manager, Mr. Jim Guerinot, nor did he || spealc with his business manager, Lee Johnson, about the letter. (Id., Ex. 3, p. 373:23-374:7; Ex. 23) Mr. Comell further testified that in his experience the commencement of an actual recording is what triggers an advance and that he had not begun recording in October 2000; he began recording that album in 2006. (Id., Ex. 3, p. 380:16-381:8) To the extent that the October 2000 letter by Mr. Paterno or any other letters were sent to Mr. Comeli’s home, he explained in his deposition that his ex-wife, Susan, reviewed those materials and that he only typically reviewed them in face-to-face meetings with professionals. (Id., Ex. 3, p. 383:12-384:17) Mr. Comell clearly testified at his deposition that he had not begun to record his second album in 2000. (Id., Ex. 3, p. 388:17-390:7) JOHNSON | FLORA PLTF’S OPP. TO GEORGE DEFTS’ MOTION alee dade Sine cee: FOR PARTIAL S. J. RE: ADVANCE -2 ‘Seattle, WA9ET21 {(f) 206.986.5566 — (f) 206.682.0675Seomryaoanran 12 13, 4 15 16 7 18 19 20 24 23 24 25 ‘The George defendants in their motion do not dispute that the $750,000 advance was paid into Mr. Comell’s account and was, by virtue of the Property Settlement Agreement, split with his ex-wife Susan Silver. The George defendants also do not dispute that Mr. Comell nonetheless had to record his second solo album without the use of the other half of the $750,000 advance and therefore had to pay these costs out of his own pocket. Defendant's expert witness Neal Hersh testified in his dectaration that Ms. George’s failure to discover this advance and address it in the negotiations was a breach of the standard of care, Mr. Hersh opined on a more probable than not basis that the advance ‘would have been discovered by a forensic accountant during a review of the financial materials by an attorney who understood the music business. Since these funds had not yet ‘been earned and were simply an advance to record a future album, they likely would have been characterized as separate property. Mr. Comell would have had a right to assert this position at the mediation or a dissolution proceeding and to recover the full amount of the advance for the future recording, rather than loosing haif of it when the accounts were split. According to Mr. Hersh, this breach resulted in Mr. Comell forfeiting half of the advance in the Property Settlement Agrecment, (See Declaration of Neal Hersh, 445) Mr. Comell’s accounting expert Lisa Ferguson similarly opined that Mr. Comell had received a $750,000 advance for an album that he had not recorded and those funds (less a 15% [$112,500] commission) were divided in the settlement agreement. These funds had not yet bcen earned and were simply an advance to record a fiature album, an album that was ultimately recorded years after the divorce and with Mr. Comell’s own funds instead of the advance. Mr. Comell lost half of the advance remainder after commissions, or $318,750 ({8750,000- $112,500] + 2), when the accounts were split. Ms. Ferguson opined that on a more probable than not basis would this advance would have been discovered by a forensic accountant during a review of the financial materials. (See Declaration of Lisa Ferguson, § JOHNSON | FLORA PLTF’S OPP. TO GEORGE DEFTS’ MOTION 508 Secon verve Sut 500 FOR PARTIAL S. J. RE: ADVANCE - 3 peer (9 206.086.5866 (f) 206.682.0675hoo RD Secarnoaa 12 13 14 15 16 7 18 19 20 at 22 23 24 25 26 12) Mr. Cornell has testified in his declaration that he would not have agreed to the property settlement had he known of the advance. IU. STATEMENT OF ISSUES (1) Whether Janet George breached the standard of care when she failed to conduct adequate discovery or hire a forensic accountant who would have discovered a $750,000 advance taken on behalf Mr. Cornell that should not have been considered community property but was nonetheless considered community property in the Property Settlement Agreement. | (2) Whether there are genuine issues of material fact on these issues where Mr. Comell’s expert witness Neal Hersh will offer testimony that Ms. George did breach he standard of care. IV. EVIDENCE RELIED UPON Declaration of Mark Johnson in Support of Plaintiffs Opposition to George Defendants' Motions for Summary Judgment and attachments; Declaration of Neal Hersh; Declaration of Lisa Ferguson. V. LEGAL AUTHORITY AND ARGUMENT ‘The George defendants rely on two basic premises in their motion for summary judgment: (1) the testimony of Charles Schmit that Ms. George met her duty; (2) the Declaration of Lee Johnson, found in support of Mr. Johnson’s summary judgment motion, which is now or will be stricken. The declaration of Charles Schmit has been superseded by Mr. Comnell’s designation of Neal Hersh as his standard of care expert. The declaration of Neal Hersh contradicts Mr. Schmit’s testimony and creates a genuine issue of material fact that Ms. George did in fact breach the standard of care by failing to conduct adequate discovery and/or hire a forensic accountant in this case. (See Declaration of Neal Hersh at para. 45) JOHNSON | FLORA PLTF'S OPP. TO GEORGE DEFTS’ MOTION Secone Avenue, ute S00 FOR PARTIAL S. J. RE: ADVANCE - 4 200 eatie, WAGE (208.286 3586 » () 206.002.0678hoon Secaernoa 12 13 14 15, 16 7 18 19 20 21 22 23 24 26 26 The Declaration of Lee Johnson has been or will be stricken from the record. This court can accordingly not consider any evidence in that declaration. The only basis for Ms. George’s motion is that she “relied on Lee Johnson, who | chose not to disclose the advance to George at the time of the divorce” and therefore did not | breach he standard of care. (George defendants’ motion at 3) This basis is directly | contradicted by the testimony of Neal Hersh in his declaration. Ms. George cannot, in short, pass the blame to Mr. Johnson when it was her duty as the attorney representing Mr. Cornell in the divorce action to ensure that all assets and Liabilities were discovered and analyzed before advising Mr. Comell to split his property. (Hersh Decl. at para. 45) Whether Mr. Johnson knew of the advance or not is ofno moment. Ms. George had copies of the recording contracts from which the advance was requested. Moreover it is a genuine issue of material fact as to whether, if Ms. George had met the standard of care and hired a forensic accountant or conducted her own adequate discovery, she would have discovered the advance and protected Mr. Cornell’s interest. ‘The evidence upon which Ms. George relies has been directly contradicted, stricken from the record, or both. Moreover there are genuine issues of material fact prohibiting summary judgment. VI. CONCLUSION Accordingly Mr. Comell respectfully requests that this court deny the George defendants’ motion to dismiss Mr. Comell’s claim for recovery of the recording advance. DATED this 19th day of May 2008. JOHNSON*FLORA, P! Mall ‘Mark Johnson, WSBA No. 8463 Attorneys For Plaintiff JOHNSON | FLORA PLTF’S OPP. TO GEORGE DEFTS’ MOTION ace suas hacia Gaps FOR PARTIAL S. J. RE: ADVANCE - 5 Seattle, WA 98121 () 206.886.5566 (1) 206.682.0875