Charles Ian Cutler vs Black Market Spirits LLC

Case Number

24CV01238

Case Type

Hearing Date / Time

Fri, 09/19/2025 - 10:00

Nature of Proceedings

Motion to Strike

Tentative Ruling

For the reasons set forth herein, the motion of cross-complainant Black Market Spirts, LLC to Strike Answer of Cross-Defendant Cutler’s Artisan Spirits, Inc., and enter default, is taken off-calendar as moot. Cutler’s new counsel is to file and serve a properly executed substitution of attorney as to Charles Ian Cutler.

Background:

This action commenced on March 4, 2024, by the filing of the complaint by plaintiff Charles Ian Cutler (“Cutler”) against defendant Black Market Spirits, LLC (“BMS”) for Breach of Contract.

As alleged in the complaint:

On April 18, 2023, Cutler and BMS entered into a Unit Repurchase Agreement whereby BMS agreed to purchase Cutler’s 1,000,000 Class A-1 Units and 848,750 Profit Interest Units for an aggregate price of $500,000.00. (Compl., ¶ 9 & Exh. 1.) The purchase price was to be paid with an initial payment of $200,000.00 being due and payable on May 5, 2023, and monthly payments of $50,000.00 to commence on July 5, 2023, with the final payment due on December 5, 2023. (Id. at ¶ 10 & Exh. 1.)

In consideration of BMS’ purchase, Cutler resigned from BMS in “all capacity for which Seller has been elected or appointed as an employee, officer, consultant, manager, member of any board or board equivalent, and member of any committee of any board or board equivalent of the Company . . ..” (Compl., ¶ 12 & Exh. C.)

BMS made the agreed upon initial payment of $200,000.00 on April 10, 2023, and the first monthly installment payment of $50,000.00 on August 7, 2023. (Compl., ¶ 14.) Thereafter, BMS ceased making any payments toward the purchase. (Ibid.)

On May 9, 2024, BMS answered the complaint with a general denial and 11 affirmative defenses.

Also on May 9, 2024, BMS filed a cross-complaint against Cutler as well as Cutler’s Artisan Spirits, Inc. (“CAS”) for Breach of Contract, Breach of Implied Covenant of Good Faith and Fair Dealing, Declaratory Relief, Conversion, Theft, Trespass to Chattels, Breach of Fiduciary Duty, Aiding and Abetting Breach of Fiduciary Duty, Fraud/Intentional Misrepresentation, Negligent Misrepresentation, Negligence, and Unfair Competition.

On June 26, 2024, while still represented by counsel, Cutler and CAS answered the cross-complaint with a general denial and 21 affirmative defenses.

On February 28, 2025, counsel for Cutler and CAS filed a motion to be relieved as counsel due to a breakdown of the attorney-client relationship. The motion was granted on May 16, 2025. The order became effective on May 28, 2025, when the order was served on Cutler and CAS. Cutler is now self-represented, and CAS is unrepresented.

As CAS is a corporation, and has not retained new counsel, BMS now moves for an order to strike the answer of CAS to the cross-complaint and enter its default.

Trial is scheduled to commence on October 3, 2025, which is two weeks following the hearing on the present motion.

BMS is correct in their argument that, except in very limited circumstances, that are not present here, a corporation is not permitted to appear in court except through a licensed attorney. (see Merco Constr. Engineers, Inc. v. Municipal Court (1978 21 Cal.3d 724.)

However, on September 15, 2025, attorney Philip D. Dracht filed a Notice of Appearance on behalf of Cutler and CAS. The motion will be taken off-calendar as moot. As Cutler was self-represented, Dracht will be instructed to file and serve a properly executed substitution of attorney as to Cutler. CAS was unrepresented, so no substitution of attorney is required for CAS.