Free Stipulation - District Court of California - California

Case 5:07-cv-04808-JF

Document 37

Filed 06/06/2008

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KURT OSENBAUGH (State Bar No. 106132) DEBORAH YOON JONES (State Bar No. 118127) SAY AKA KARITANI (State Bar No. 240122) WESTON, BENSHOOF, ROCHEFORT, RUBALCA VA & MacCUISH LLP
333 South HOQ.e Street, Sixteenth Floor

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Los Angeles, California 90071
Telephone: (213) 576-1000
Facsimile: CZ)3) 576-1100

kosenbaughCfwDcounsel.com
dj onescgwbcounsel .com skaritann~wbcounsel. com

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Attorneys for Plaintiffs and Counter-Defendants BP WEST COAST PRODUCTS LLC and ATLANTIC RICHFIELD COMPANY

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UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA
BP WEST COAST PRODUCTS LLC, a Delaware Limited Liability Company; and ATLANTIC RICHFIELD COMPANY, a
Delaware Corporation,

Case No.: C07 04808 JF
STIPULATION; AND rPROPOSED)

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Plaintiffs,
v.

REVISED SECOND AMENDED Co'MPLAINT
Crtm: 4

ORDER FOR LEAVE TO FILE

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STTN ENTERPRISES, INC., a California COl)oration; NAZIM FAQUIRY AN, an individual; SAYED FAQUIRY AN, an individual; and MAGHù FAQUIRY AN, an individual; and AVA GLOBAL ENTERPRISE, LLC, a California limited liability company, Defendants.
AND RELATED COUNTERCLAIM.

Honorable Jeremy Fogel

Filing Date:

September 17, 2007

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STIPULATION; AND (PROPOSED) ORDER FOR LEAVE TO FILE THIRD AMENDED COMPLAINT AND AMENDED COUNTERCLAIM

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Case 5:07-cv-04808-JF

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STIPULATION

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WHEREAS, the present action was filed by Plaintiff and Counter-

defendant BP West Coast Products LLC ("BPWCP") against Defendants and
Counter-claimants STTN Enterprises, Inc., Sayed Faquiryan, Nazim Faquiryan,
Maghul Faquiryan, and A V A Global Enterprises, LLC (collectively referred to as

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"STTN") on September 17,2007;
WHEREAS, on May 20, 2008, the Court issued a stipulated order ("May ¡

20th Order") granting leave for BPWCP and ARCO to amend its First Amended
Complaint to: (1) dismiss the Tenth through Thirteenth Causes of Action, which are
claims that are based on STTN's alleged trademark violations, and (2) withdraw

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ARCO as Plaintiff from this action. The May 20th Order attached the Second
Amended Complaint proposed by BPWCP. The Court's May 20th Order also granted
STTN leave to dismiss ARCO as a Counter-Defendant;

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WHEREAS, shortly after the Court issued the May 20th Order and
during the course of discovery, BPWCP learned that the Notice of Termination sent
on September 6, 2007, a copy of which is attached to the complaint on file, referenced
the 20-year am/pm and gas agreements entered into on July 11, 2006 (collectively,

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"20-year Agreements") but did not specifically reference the I-year Contract Dealer
Gasoline Agreement dated October 12, 2006 ("I-year Agreement"). Despite the fact

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that BPWCP maintains that the Notice of Termination properly and adequately
(1) advises STTN of the grounds for termination of

the gasoline and convenience store

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franchises, (2) provides a clear statement of the intent to terminate, (3) specifies the
termination date, and (4) includes a summary statement of the Petroleum Marketing
Practices Act, 15 U.S.C. §§ 2801, et seq. (the "PMPA"), BPWCP would like to clarify
for the Court and parties the facts concerning the termination of the gasoline and

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convenience store franchises;

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STIPULATION; AND (PROPOSED) ORDER TO FILE. .:.1, THIRD AMENDED COMPLAINT AND COUNTERCLAIM

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WHEREAS, BPWCP seeks to file a revised Second Amended Complaint
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and to clarify and allege that the Notice of Termination sent on September 6, 2007,
terminated the gas and convenience store franchise agreements including the 20-year

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Agreements and the I-year Agreement;

WHEREAS, STTN has not yet filed its amended Answer and
Counterclaim to BPWCP's Second Amended Complaint.

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NOW THEREFORE, BPWCP and STTN, by and through their
respective attorneys of record herein, hereby agree and stipulate to the following:
1. BPWCP may file the revised Second Amended Complaint, a copy

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the Court; and¡¡

of which is attached hereto as Exhibit A and the original of which is being lodged with

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STIPULATION; AND (PROPOSED) ORDER TO FILE THIRD AMENDED COMPLAINT AND COUNTERCLAIM

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2. STTN may forego filing an amended Answer and Counterclaim

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against BPWCP's previously proposed Second Amended Complaint and instead file
the Amended Answer and Counterclaim against BPWCP's revised Second Amended

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Complaint such that STTN may dismiss ARCO as Counter-defendant from this
action.

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DATED: ~"1, 2008

KURT OSENBAUGH DEBORAH YOON JONES
WESTON, BENSHOOF, ROCHEFORT,
SA Y AKA KARIT ANI

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RUBALC VA MacCUISH

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Attorneys for Plaintif1 s and Counter-Defendants BP WEST COAST PRODUCTS LLC and ATLANTIC RICHFIELD COMPANY
DATED: May _,2008

eon J

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JOHN G. MICHAL BAKER MANOCK & JENSEN PC
John G. Michael Attorneys for Defendants

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STTN ENTERPRISES, INC., SAYED F AQUIRY AN, NAZIM F AQUIRY AN, MAGHUL F AQUìRY AN, " AND A V A GLOBAL ENTERPRISES, LLC

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IPROPOSEDl ORDER PURSUANT TO STIPULATION, IT IS SO ORDERED.

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DATED:
Hon. Jeremy Fogel

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United States District Court

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STIPULATION; AND (PROPOSED) ORDER TO FILE;
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THIRD AMENDED COMPLAINT AND COUNTERCLAIM'

JUN-06-2008 FR I 10: 23 AM BAKER MANOCK JENSEN

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2. STTN may forego filing an Hmended Answer and Counterclaim against BPWCP's previously proposed Second Amended Complaint and instead file

the Amended Answer and Counterclaim against BPWCP's revised Second Amended Complaint such that STT may dismiss ARC J as Counter-defendant from this
action.
DATED: May _,2008

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KURT OSENBAUGH DEBORAH YOON JONES SA Y AK KARIT ANI WESTON, BENSHOOF, ROCHEFORT, RUBALCA VA &: MacCUISH LLP
Deborah Y oon Jones Attorneys for Plaintiffs and Counter-Defendants BP WEST COAST PRODUCTS LLC and ATLANTIC RICHFYELD COMPANY

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DATED: ~, 2008

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BAKR;l0CK~
JOHN G. MICHAL
STTN ENTERPRIS:ES~ INC:;SA YED FAQUIRY AN, NAZIM FAOUIY Al~ÊMAlJHUL FAQU1RY AN,
Atto ~s for Defendants

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~ ~H.iae

AN AVA GLOBAL NTERPRISES, LLC
.æROl-OSEDLORl~ER

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PURSUANT TO STIPULATION, IT)8 SO ORDERED.
DATED:
Hon. Ji~remy Fogel United States District Court

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STII'ULATION; AND ¡PROPOSEDI OROi,~ TO FILE THIlD AMENDED COMPL,AJNT AND COUNTERCLAIM

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KURT OSENBAUGH (State Bar No. 106132) DEBORA YOON JONES (State Bar No. 118127)
WESTON, BENSHOOF, ROCHEFORT, RUBALCAVA & MacCUISH LLP 333 South Hope Street Sixteenth Floor Angeles, California 90071
Los

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SA Y AK KAT ANI (State Bar No. 240122)

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Telephone: (213) 576-1000

Facsimile: (213) 576-1100
Email: kosenbaugh~wbcounsei.com

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dj ones~wbcounsel.com

skaritann~wbcounsel.com

Attorneys for Plaintiff BP WEST COAST PRODUCTS LLC

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UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA
BP WEST COAST PRODUCTS LLC, a Delaware Limited Liability Company,
Plaintiff,
v.

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Case No.: C07 04808 RS

SECOND AMENDED COMPLAINT FOR:

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STTN ENTERPRISES, INC., a California Coi:oration; NAZIM F AQUIRY AN, an individual; SAYED F AQUIRY AN, an individual; and MAGHV F AQUIRY AN, an individual; and A V A GLOBAL ENTERPRISE, LLC, a California limited liability company,
Defendants.

Cl) DECLARATORY RELIEF UNDER THE PETROLEUM MARKTING PRACTICES ACT
US U.S.C. && 2801, et seq.l;

(2) nREACH OF CONTRACTGASOLINE AGREEMENT; (3) BREACH OF CONTRACTMINI MARKT AGREEMENT; (4) BREACH OF FRANCHISE
GUARANTIES; (5) COMMON COUNT - GOODS SOLD AND DELIVERED; (6) UNJUST ENRICHMENT; (7) BREACH OF CONTRACTMINI MART LOAN AGREEMENT; (8) BREACH OF MINI MARKET LOAN GUARANTIES; and

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(9) JUDICIAL FORECLOSURE
Filing Date: September 17, 2007

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PlaintiffBP West Coast Products LLC ("BPWCP") alleges as follows:

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SUMMARY OF CLAIMS
1.

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This suit involves BPWCP's former gasoline station and mInI

market franchise located in Hollister, California.

BPWCP seeks damages and

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declaratory relief based upon Defendants' breaches of the applicable franchise
agreements, breaches' of a related loan agreement, and breaches of individual

guaranties.
2.

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The Defendants breached the franchise agreements by failing to

pay for over $139,000 worth of ARCO-branded gasoline and failing to operate the
station and sell gasoline product for approximately 15 consecutive days. BPWCP

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bent over backwards to give Defendants multiple opportunities to correct the defaults.

Defendants acknowledged their obligation to pay for the gasoline and BPWCP even
agreed to a payment plan. Nonetheless, Defendants failed to pay for the gasoline and failed to operate the station and sell gasoline product for at least 15 consecutive days

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in violation of the franchise agreements. As such, BPWCP terminated the franchise
agreements.
3.
By virte of the franchise breaches, the Defendants have also

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defaulted on a $150,000 loan that was given by BPWCP to the franchisee for purposes

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of refurbishing the mini market store. The loan was secured by the- real property on
which the gasoline station and mini market were located as well as the fixtures located
thereon. Given the franchise termination and Defendants' loan defaults, the entire

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loan indebtedness has accelerated and is now due. Defendants are required to pay the

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$150,000 loan balance to BPWCP and, to date, they have refused to do so.
Accordingly, BPWCP moves for judicial foreclosure on the $150,000 loan and seeks
damages for breach of the loan agreement and guaranties.

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THE PARTIES

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4. Plaintiff BPWCP is qualified to do business in California and is a
limited liability company organized and existing under the laws of the State of
Delaware. BPWCP was, at all relevant times hereto, the franchisor for ARCO-

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branded service stations and am/pm mini market convenience stores including the
facility at issue in this litigation.
5.

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BPWCP is informed and believes that defendant STTN

Enterprises, Inc. ("STTN") is, and at all relevant times hereto was, a California

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corporation, which has offices and does business in San Benito County, California.

STTN is the former franchisee for the facility located at 631 San Felipe Road,
Hollster, California 95035 (the "Station").
6. BPWCP is informed and believes that defendant Nazim Faquiryan

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and Sayed Faquiryan are individuals residing in the City of Hollister, County of San

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Benito, State of California. BPWCP is informed and believes that, at all relevant

times hereto, Nazim Faquiryan and Sayed Faquiryan were and are the sole
shareholders of STTN and individual guarantors for the Station franchise. BPWCP is
also informed and believes that Sayed Faquiryan is the father ofNazim Faquiryan.

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7. BPWCP is informed and believes that defendant Maghul
Faquiryan is an individual residing in the City of Hollster, County of San Benito,
State

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of California. BPWCP is informed and believes that, at all relevant times hereto,

Maghul Faquiryan was and is the spouse of Sayed Faquiryan and an individual

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guarantor for the loans related to the Station franchise.
8.

BPWCP is informed and believes that defendant A V A Global

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Enterprises, LLC ("AVA Global") is, and at all relevant times hereto, was and is a

California limited liability company, which has offices and does business in San

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Benito County, California. AVA Global's address, according to the California

Secretary of State business search website, is 631 San Felipe Road, Hollster,
California (which is the same address as the Station). At all relevant times, STTN
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leased the real property upon which the Station is located ("Real Property") from
A V A Global Enterprise, LLC ("A VA Global"). A V A Global is the fee simple owner

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of the Real Property. BPWCP is informed and believes that individual Defendant

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Nazim Faquiryan is one of the two equal shareholders of AVA GlobaL. The other
50% shareholder of AVA Global is not named individually in this action.

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9. BPWCP is informed and believes that STTN, Nazim Faquiryan,

Sayed Faquiryan, Maghul Faquiryan, and AVA Global, (collectively, "Defendants"),
and each of them, in committing the acts and omissions alleged in this Second

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Amended Complaint acted as agents and servants of the other Defendants, acted
within the scope of their authority as agents and servants of the other Defendants,

acted in concert with the other Defendants with a design and' for the purposes of
injuring BPWCP and of unlawfully benefiting some or all of Defendants, or, in the
alternative, approved and ratified the acts and omissions of the other Defendants or

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third parties, such that each of the Defendants is jointly and severally liable for the
acts and omissions of each other Defendants.

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JURISDICTION AND VENUE
This action concerns, inter alia, the termination of a service station

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franchise relationship, which is governed by the Petroleum Marketing Practices Act,
15 U.S.C. §§ 2801, et seq. (the "P:tA"). Accordingly, this Court has jurisdiction
over BPWCP's claims, by virtue of 28 V.S.C. § 1331 and 15 V.S.C. § 2805(a), and

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this Court's pendent jurisdiction. Furthermore, this Court has jurisdiction pursuant to
28 V.S.C. § 1331,28 U.S.C. §§ 1338(a) and (b), and 28 V.S.C. § 2201, because this is

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a civil action seeking declaratory relief under the P:t A. The amount in controversy
exceeds the sum or value of $75,000.00.
11.

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Venue is proper in the Northern District of California pursuant to

28 U.S.C. § 1391(b) because a substantial part of the events or omissions giving rise

to BPWCP's claims occurred in this District; because the subject franchise is located
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in this District; and because BPWCP is informed and believes that the individual
Defendants reside in this District.

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GENERAL ALLEGATIONS
The Franchise A2:reements
12. BPWCP is engaged in the marketing and distribution of

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motor fuel

in the State of California and elsewhere in the United States. BPWCP currently has

ARCO-branded gasoline stations with am/pm mini market convenience stores located
throughout the Western States. Among its activities, BPWCP sells ARCa-branded

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motor fuels to franchisees and, at certain of its properties, BPWCP offers am/pm mini

market convenience store franchises to be operated concurrently with the gasoline
stations. Pursuant to franchise agreements, BPWCP licenses to its franchisee dealers

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the right to use ARCa's trade names, trademarks, and service marks in connection
with the resale of ARCO-branded motor fuels and the operation of the am/pm mini

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market convenience stores; Franchisee dealers pay a royalty for use of this right.
ARCO is the registered owner of these trademarks, service marks, and trade names
and has the right to enforce any violations thereof. BPWCP has the right to utilize

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these marks in connection with its ARCa and am/pm franchises.
13.

The franchise relationship between STTN and BPWCP is governed

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by written agreements, principal among them are: (1) a Contract -Dealer Gasoline
Agreement, which includes any and all amendments and addendums ("Gasoline

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Agreement"), and (2) an am/pm Mini Market Agreement, which includes any and all

amendments and addendums ("Mini Market Agreement"). The Gasoline Agreement
and Mini Market Agreement are each effective as of July 11, 2006. True and correct
copies of the Gasoline Agreement and Mini Market Agreement are attached hereto as

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Exhibit A and Exhibit B, respectively, and are incorporated herein as though fully set
forth at length. The Gasoline Agreement and Mini Market Agreement contain an

expiration date of July 12,2026.
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14. On June 20, 2006, Defendants Sayed Faquiryan and Nazim

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Faquiryan each signed a Guaranty Agreement and individually guaranteed the

obligations owed by STTN to BPWCP under the Mini Market Agreement and
Gasoline Agreement ("Franchise Guaranties"). True and correct copies of the

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Franchise Guaranties are collectively attached hereto as Exhibit C, and are
incorporated herein as though fully set forth at length.

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15. Effective October 12, 2006, STTN entered into a I-year trial
franchise for gasoline only during the remodeling of the mini market store located at

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the Station. As such, STTN signed an Amendment to the Contract Dealer Gasoline

Agreement ("Amendment to Gasoline Agreement") and a I-year Contract Dealer
Gasoline Agreement, which includes any and all amendments and addendums (" 1year Gasoline Agreement"). True and correct copies of the Amendment and I-year

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Gasoline Agreement are attached hereto as Exhibit D and Exhibit E, respectively, and

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are incorporated herein as though fully' set forth at length. The Mini Market

Agreement, the Gasoline Agreement, the Amendment, the I-year Gasoline
Agreement, and the Franchise Guaranties shall be referred to collectively as the
"Franchise Agreements." Paragraph 5 of the Amendment to Gasoline Agreement
provides that all terms and provisions of the Gasoline Agreement, as previously

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amended or supplemented, except those specifically changed by the Amendment to
Gasoline Agreement, shall remain in full force and effect. (Exhibit D; ~ 5.)
16.

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The purposes of the Franchise Agreements are to provide locations

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at which ARCO-branded petroleum products can be sold to the public by franchisees

such as STTN, and to provide locations where customers of the service stations may
purchase store goods.
17.

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The Franchise Agreements set forth the obligations and

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undertakings required of STTN, which are material to the operation of a BPWCP
franchise. The pertinent provisions of the Franchise Agreements provide, inter alia,

that:
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(a) The franchisee must "exert good faith efforts to carr out the

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provisions of this Agreement following written notice to Buyer from BPWCP of such

failure and fifteen calendar days to cure such failure." (See Gasoline Agreement,
~ 17.1(a), Exhibit A; I-year Gasoline Agreement, ~ 17.1(a), Exhibit E.);
(b)

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The franchisee is also required to "order and make available

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for retail sale all grades of Gasoline which BPWCP offers to Buyer (hereinafter
collectively, "Product"), in amounts sufficient to satisfy all foreseeable retail customer

demand for Product at the Premises and wil at all times have available for sale some
of each grade of

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Product . . .." (See Gasoline Agreement, Article 2, Exhibit A; I-year

Gasoline Agreement, Paragraph entitled "Orders" at page 1, Exhibit E.);
(c)
The franchisee is also required to "pay the price specified by

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BPWCP in effect at the time and place of delivery for purchasers of Buyer's class of
trade" and by "electronic funds transfer initiated by BPWCP, wire transfer, cashier's

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check or business check, whichever BPWCP directs, delivered by Buyer at the time

and place as designated by BPWCP." (See Gasoline Agreement, Aricles 5 and 6,
Exhibit A; I-year Gasoline Agreement, Aricles 5 and 6, Exhibit E.); and
Cd)

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The franchisee is also required to conduct all of its

operations of the Station, including the Mini Market, under the terms and conditions

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of each of the Franchise Agreements. (See Mini Market Agreement, Section 4.05,
Exhibit B.)

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18.

The Loan Agreements
In addition to the requirements concerning operation of

the Station,

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the Franchise Agreements also required STTN to complete a remodel or retrofit of

the

Station within nine (9) months of the commencement of the franchise relationship.
(See Gasoline Agreement, Section 1.2, Exhibit A; I-year Gasoline Agreement,

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Section 1.2, Exhibit E; Mini Market Agreement, Section 5.03ca), Exhibit B.) BPWCP

assists its franchisees in complying with these "remodel and retrofit" requirements by
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offering a special loan program to provide funds specifically for completing

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construction and remodeling at its franchise locations. Specific details of the loan
program are described below, however, generally, under BPWCP's loan program if a
franchisee meets certain yearly gallonage and store sale requirements a portion of the
loan is deemed repaid at the end of each year term. Thus, as long as a franchisee sells

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a specified amount of gasoline product and/or store products each year for the
duration of the loan term, the loan payments for that year are deemed repaid.

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Furthermore, the franchisee enjoys the use of a remodeled and retrofitted station

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which, in turn, attracts more customers and therefore generates more income and
profit for the franchisee.
19. On February 12, 2007, BPWCP and STTN entered into two Loan

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Agreements, whereby BPWCP agreed to loan STTN the total sum of $475,000 to be
used toward BPWCP-approved capital improvements for the Station.

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The am/pm Mini Market Loan A!!reement
20. The first loan agreement - - the "am/pm Mini Market Loan

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Agreement" - - provided a base loan in the amount of $150,000 to fund the costs
associated with pre-approved modifications and/or equipment and improvements to

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the am/pm Mini Market (hereinafter, "Store Loan Agreement"). The Store Loan
Agreement also included an additional $75,000 that BPWCP could -elect to disburse
for refreshing and refurbishing the am/pm Mini Market on the eleventh anniversary of
the base loan disbursement. A true and correct copy of the Store Loan Agreement is

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attached hereto as Exhibit F, and is incorporated herein as though fully set forth at
length.
21.
Pursuant to the Store Loan Agreement, the loan was interest-free

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but was conditioned upon Defendants' agreement to pay five percent (5%) of the
loaned amount each year over the course of 20 years, or alternatively, sell
merchandise in the am/pm Mini Market in the Anual Guaranteed Amount of at least
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$960,000 each year. If Defendånts sold $960,000 in gross sales of merchandise in the

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am/pm Mini Market in a year, BPWCP would deem the loan payment for that year as
repaid.
22. In addition, pursuant to the terms of the Store Loan Agreement, the

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loan funds were to be disbursed directly to the third parties who were retained to
complete the construction, remodeling and retrofitting. To ensure that all conditions

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for disbursement were met, STTN and BPWCP entered into a Disbursement
Agreement that sets forth the terms and conditions governing disbursements of

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funding. The Disbursement Agreement is specifically referenced in the Store Loan
Agreement, and a true and correct copy is attached hereto as Exhibit G, and is

incorporated herein as though fully set forth at length. The Disbursement Agreement
provides, in pertinent part, that:

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"Construction Loan Proceeds wil be disbursed from time to

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time upon receipt by BP West Coast Products LLC or its
designee of Pay Vouchers, executed by (STTN) and
Contractor, accompanied by original detailed invoices, . . .

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and BP West Coast Products LLC or its designee have the

right to withhold payment on any and all Pay Vouchers if
supporting documentation reasonably requested is not

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provided. This may include original invoices, job inspection
card copy, IRS form W -9, appropriate lien releases for labor
and/or materials, receipts, photos, revised cost breakdown

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and

Affidavit

and

Certification

of Completion

of

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Builder/Contractor."
(See Disbursement Agreement, Paragraph 3, Exhibit G.) As such, the Store Loan

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Agreement did not call for a lump sum payment to the Defendants but rather release
of funds were contingent upon (a) specified work being completed at the Station, and
(b) documentation to support payment of

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that work by STTN.
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SECOND AMENDED COMPLAINT

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Document 37

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1

23. STTN agreed to the terms of the Store Loan Agreement, and
Nazim Faquiryan and Sayed Faquiryan signed all necessary loan paperwork on behalf

2
3

of STTN. The Store Loan Agreement was secured by a recorded Deed of Trust with
Assignment of Rents, Security Agreement and Fixture Filing ("Deed of Trust") on the
real property upon which the Station was located ("Real Propert"). A V A Global, as

4
5

6 7
8

the owner of the Real Propert, executed the Deed of Trust dated March 2, 2007 and

recorded on March 9, 2007, which irrevocably granted BPWCP the power of sale of
all of A V A Global's right, title and interest in the Real Propert. A true and correct

9
10
1 i

copy of the Deed of Trust is attached hereto as Exhibit H, and is incorporated herein
as though fully set forth at length. A V A Global, BPWCP and STTN also entered into

a "Consent to Encumbrance of Tenant's Interest" dated March 2, 2007 and recorded
on March 9, 2007 ("Consent to Encumbrance"). The Consent to Encumbrance created

12
13

a leasehold mortgage encumbering STTN's leasehold estate in the Lease and Real
Property ("Leasehold Mortgage"). A true and correct copy of the Consent to

14
15

Encumbrance is attached hereto as Exhibit I, and is incorporated herein as though
fully set forth at length. In addition, STTN executed a Promissory Note evidencing
the Store Loan. A true and correct copy of the executed Promissory Note is attached
hereto as Exhibit J and is incorporated herein as though fully set forth at length.
24. BPWCP's secured interest in the Real Propert is second only to

16
17 18

19

20
21

senior lienholder Excel National Bank who maintains a first deed ofirust on the Real
Propert in the amount of approximately $ i ,987,000.
25. In addition, the Store Loan Agreement was secured by a UCC-l

22
23

Financing Statement ("UCC- i ") on the personal property located on or affixed to the

24
25

Real Property or the Improvements and other propert more fully described in the
attachments to the UCC- i. A true and correct copy of the UCC-l is attached hereto as
Exhibit K, and is incorporated herein as though fully set forth at length.
26. As of May 29,2007, the full amount of $150,000 was funded and

26 27
28

disbursed for Defendants' benefit pursuant to the Store Loan Agreement.
13
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SECOND AMENDED COMPLAINT

Case 5:07-cv-04808-JF

Document 37

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Page 16 of 75

1

2
3

The Gasoline Loan A2reement
27.

The second loan agreement - - the "Gasoline Loan Agreement" - -

4
5

in the amount of $250,000 was to fund costs associated with the pre-approved
modifications and/or equipments and improvements which pertain to the gasoline
sales-related aspects of the Station (i.e., dispensers, canopy, etc.). Disbursement of
the funds under the Gasoline Loan Agreement was contingent upon STTN abiding by
requirements similar to those applicable to the Store Loan Agreement. However,

6 7
8

9
10
11

STTN failed to provide sufficient financial documents, including proof of any
payment by STTN of any construction-related expenditures, required back-up invoices
and/or lien releases, all of which are requirements of the Gasoline Loan Agreement

12
13

and related Disbursement Agreement. As a result of STTN's failures to abide by the
terms of

the Gasoline Loan Agreement and related Disbursement Agreement, BPWCP

14
15

has not disbursed (and wil not be disbursing) any monies under the Gasoline Loan to

STTN.

16 17 18 19

The Loan Guaranties
28.

Defendants

Sayed

F aquiryan,

Maghul

Faquiryan

(Sayed

Faquiryan's spouse), and Nazim Faquiryan each signed a Guaranty Agreement and

20
21

individually guaranteed the loan obligations owed by STTN to BPWCP under the
Store Loan Agreement c"Loan Guaranties"). True and correct copies of the Loan
Guaranties are collectively attached hereto as Exhibit L, and are incorporated herein

22
23

as though fully set forth at length.

24
25

STTN Breached the Franchise A2reements
29. Among other things, STTN was required, pursuant to the Franchise
Agreement, to maintain adequate supplies of gasoline for sale and make payments for

26 27 28

gasoline deliveries. (See Gasoline Agreement, Aricle 2, Exhibit A; I-year Gasoline
14
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SECOND AMENDED COMPLAINT

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Document 37

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1

Agreement, Paragraph entitled "Orders" at page 1, Exhibit E.) Payment for gasoline

2
3

product was accomplished by way of an electronic funds transfer ("EFT") from
STTN's bank account.
30.

4
5

However, as of January 29, 2007, BPWCP began requiring STTN

to present a cashier's check in order to receive gasoline product because numerous
EFT requests pertaining to gasoline deliveries were returned for insufficient funds by

6
7
8

STTN's bank. In other words, STTN failed to pay BPWCP for the gasoline product
that had been delivered.
31.

9
10
11

When a franchisee is found to be in violation of the Franchise

Agreements, BPWCP issues a written "Default Notice" describing the violation
("Default"). The Default is then sent to the franchisee via certified mail, giving the franchisee an opportunity to cure the violation. BPWCP issued a number of Defaults

12
13

based upon STTN's repeat operational violations for failure to accept gasoline
delivery and to make payment for gasoline that was delivered and payable upon
receipt. True and correct copies of all Defaults pertaining to STT's failure to pay for
gasoline product deliveries are attached hereto as Exhibit M and are incorporated

14
15

16
17 18

herein as though fully set forth at length.

32. STTN readily admits that they owe the money to BPWCP for

19

varrous gasoline deliveries. Indeed, Nazim Faquiryan and Sayed Faquiryan
acknowledged and agreed to in writing in a letter dated May 4, 2007, that they wil
pay $30,000 per month until the total outstanding balance of the gasoline debt is paid
in full. A true and correct copy of the letter agreement to pay the gasoline

20
21

22
23

debt signed

by Nazim Faquiryan and Sayed Faquiryan is attached hereto as Exhibit N and is
incorporated herein as though fully set forth at length.

24
25

33. To date, STTN has failed to pay for the gasoline. The current
outstanding balance for the gasoline product that Defendants failed to reimburse

26
27 28

BPWCP for gasoline product delivered is One Hundred Thirty-Nine Thousand, Nine
Hundred Fift Dollars and Eighty-Seven Cents ($139,950.87).
15
1194164,1

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SECOND AMENDED COMPLAINT

Case 5:07-cv-04808-JF

Document 37

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Page 18 of 75

1

34.

In addition to Defendants' failure to sell gasoline, commencing on

2
3

August 23, 2007 through at least September 6, 2007, STTN failed to operate the
Station and sell gasoline product for at least 15 consecutive days in violation of the
Franchise Agreements.

4
5

6 7
8

BPWCP Terminates the STTN Franchise
35.

Given STTN's continuing breach of the Franchise Agreements,

BPWCP sent a Notice of Termination letter dated September 6, 2007, to STTN,
advising that the Franchise Agreements would be immediately terminated

9 10
11

("Termination Notice").
length.
36.

A true and correct copy of the Termination Notice is

attached hereto as Exhibit 0 and is incorporated herein as though fully set forth at

12
13

The Termination Notice referenced the 20-year Gasoline

14
15

Agreement and Mini Market Agreement entered into on July 11, 2006 (collectively,

"20-year Agreements," and which are attached hereto as Exhibits A and B). As plead
earlier, the Gasoline Agreement was amended per the Amendment to Gasoline
Agreement (Exhibit D) and I-year Gasoline Agreement (Exhibit E).

l6
17
18

37.

The essential elements of the PMP A notice requirement under

19

Section 2804( c) provide that the manner and form of notification shall contain:
(a)

20
21

A statement of intention to terminate the franchise and the
The date on which such termination takes effect; and

reasons for termination;
cb)

22
23

(c)

The statutory summaries prepared and published in the

24
25

Federal Register and required under Section 2804(d).

38. BPWCP's Termination Notice properly and adequately (1) advises

26 27
28

STTN of the grounds for termination of the gasoline and convenience store franchise,
(2) provides a clear statement of the intent to terminate, (3) specifies the termination
13
SECOND AMENDED COMPLAINT

16
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1

date, and (4) includes a summary statement of the Petroleum Marketing Practices Act,
15 D.S.C. §§ 2801, et seq. (the "PMPA").
39. The Franchise Agreements provide that BPWCP may terminate the

2
3

4
5

Franchise Agreements for various reasons which include, but are not limited to, the
following:
- (a)

6 7
8

Failure to exert good faith efforts to carr out the provisions

of the Franchise Agreements following written notice and opportunity to cure (See
Gasoline Agreement, Section 17.1(a), Exhibit A~ I-year Gasoline Agreement, Section
17.1(a), Exhibit E.);
(b)

9 10
11

Failure to timely pay all sums due to which BPWCP is

legally entitled (See Gasoline Agreement, Section 17.1 ch), Exhibit A; I-year Gasoline
Agreement, Section 17.1(h), Exhibit E.);

12
13

(c)

Failure to operate the Premises for seven (7) consecutive

14
15

calendar days, or lesser period, which constitutes an unreasonable period of time (See
Gasoline Agreement, Section 17.1 (i), Exhibit A~ I-year Gasoline Agreement, Section
17.1(i), Exhibit E.);
C d) Breach of any material provision of the Gas Agreement,

16 17
18

including without limitation, "Buyer's failure to order and make available for sale

19

quantities of each grade of Product which are sufficient to satisfy foreseeable
customer demand." (See Gasoline Agreement, Section 17.1(0), Exhibit A~ I-year
Gasoline Agreement, Section 17.1(0), Exhibit E.); and
ce)

20
21

22
23

Termination of anyone other franchise agreement (e.g., Gas

Agreement) when there is "Concurrent Operations at the Premises," in which

24
25

"Concurrent Operations" is defined as the operation of the am/pm Mini Market in
conjunction with another or more than one other BPWCP franchise. (See Sections
4.05 and 18.05 of

26 27
28

the Mini Market Agreement, Exhibit B.)

17
i 194164,1

14
SECOND AMENDED COMPLAINT

Case 5:07-cv-04808-JF

Document 37

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Page 20 of 75

1

40. The pertinent provisions of

the Petroleum Marketing Practices Act,

2
3

28 V.S.C. §280 1, et seq. ("PMP A") allow, inter alia, for termination upon the
occurrence of the any of

the following:

4
5
material provision of

(a) Failure by the franchisee to comply with a reasonable and

the franchise (28 V.S.C. § 2802(b )(2)cA));

6 7
8
out the provisions of

(b)

Failure by the franchisee to exert good faith efforts to carr

the franchise (28 U.S.C. § 2802(b )(2)(B));

(c)

Occurrence of an event which is relevant to the franchise

9

relationship as a result of which termination of the franchise relationship is reasonable
(28 V.S.C. § 2802(b)(2)(C)); and

10
11

(d)

Failure by the franchisee to operate the marketing premises
time (28 V.S.C. §2802(c)(9)).

12
13

for 7 consecutive days, or such lesser period which under the facts and circumstances
constitutes an unreasonable period of

14
15

41.

Furthermore, given Defendants' long-standing debt owed to

BPWCP for unpaid gasoline, their failure to operate the Station and sell gasoline for at
least 15 consecutive days, and the numerous opportunities given by BPWCP to
Defendants to cure the defaults, the termination was effective immediately as it was

16

l7
18

not reasonable for BPWCP to provide any additional notice to STTN. (28 V.S.C. §
2804(b ).)

19

20
21

42. The Franchise Agreements provide that STTN wil owe BPWCP

certain sums upon termination. Specifically, Aricle 19.0 1 (d) of the Mini Market

22
23

Agreement states that, upon termination, STTN shall owe BPWCP liquidated
damages. (See Exhibit B.)

24
25

43. Accordingly, BPWCP terminated the Franchise Agreements on the
grounds that STTN:
ca)

26 27 28

failed to have any gasoline products available for sale to the

motoring public for at least 15 consecutive days, despite the fact that BPWCP sent
STTN a total of

twelve Defaults for failure to offer all grades of gasoline for sale (true
18

15
SECOND AMENDED COMPLAINT

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Document 37

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Page 21 of 75

1

and correct copies of which are included ii1 Exhibit M and are dated August 24
through 31, 2007 and September 1 through 4, 2007); and

2
3

(b) failed to timely pay BPWCP for gasoline products in a
timely manner, 'incurring an outstanding balance of $126,194.77, as of September 6,
2007, for gasoline product deliveries that are due and payable at the time of delivery.

4
5

6 7
8

STTN Defaulted on the Store Loan Ae:reement
44.
In addition to the Franchise Agreement breaches, STTN also

9
10
11

defaulted on the Store Loan Agreement. Pursuant to the Store Loan Agreement,

STTN must repay the outstanding balance of the loan in full to BPWCP within 30
days of the occurrence of an "Event of Default." Paragraph 4 of the Loan Agreement

12
13

provides the pertinent "Events of Default," which include, but are not limited to, the
following:
(a)

14
15

"The (Mini Market Agreement) is terminated by either

Lender or Borrower prior to the end of its stated term" (See Store Loan Agreement,
Section 4.5, Exhibit F.);
(b)
A default or "Event of Default" shall have occurred under

16
17

18
19

any of the other Loan Documents" (See Store Loan Agreement, Section 4. lO, Exhibit

F.);
(c)

20
21

"The Borrower fails to sell Products continuously at the

Facility. . . . " (See Store Loan Agreement, Section 4.4, Exhibit F.); or
(d) "The failure by the Borrower to make any payments of

22
23

principal of or interest and any other indebtedness secured by the Propert, or there
shall occur any other event that would permit the holder of such indebtedness to

24
25

accelerate the maturity thereof." (See Store Loan Agreement, Section 4.12, Exhibit

26 27 28

F.)
45. In the Termination Notice, BPWCP demanded that STTN repay
the outstanding balance of the Store Loan within 30 days of the termination

16
19
1194164,1

SECOND AMENDED COMPLAINT

Case 5:07-cv-04808-JF

Document 37

Filed 06/06/2008

Page 22 of 75

1

cOctober 5,2007), pursuant to the Store Loan Agreement and Promissory Note. As of
September 5, 2007, the outstanding balance on the Store Loan Agreement was

2
3

$150,000.00. (See Termination Notice, Exhibit 0.)

4
5

46. To date, STTN has failed and refused to pay the outstanding
balance due pursuant to the Store Loan Agreement.

6 7
8

FIRST CLAIM FOR RELIEF
cDeclaratory Relief Under The Petroleum Marketing Practices Act)
cBy Plaintiff BPWCP Against STTN Enterprises, Inc.)

9

10
11

47. The allegations of paragraphs 1 through 46 above are incorporated
herein by reference as though fully set forth herein.

12
13

48. There presently exists an actual controversy within this Court's

jurisdiction between BPWCP, on the one hand, and STTN, on the other hand, in that
BPWCP asserts that:

14
15

16 17
18 19

(a) STTN's franchise and the franchise relationship with BPWCP were terminated pursuant to Termination Notice dated September 6, 2007
(Exhibit 0);

(b)

Pursuant to the Petroleum Marketing Practices Act, 15

D.S.C. Section 2802, and the terms of the Franchise Agreements between the parties,
BPWCP was entitled to terminate STTN's franchise at the Station;
(c)

20
21

BPWCP's grounds for terminating STTN's franchise were

22
23

legitimate' and non-discriminatory; and

(d)

The Termination Notice was delivered on the earliest date

24
25

reasonably practicable, and were otherwise reasonable under 15 D.S.C. § 2804(b).

49. BPWCP is informed and believes and on that basis alleges, that
STTN disputes each ofBPWCP's aforementioned assertions.
50.

26 27
28

Defendants disagree with the above, and moreover, threatened to

pursue legal remedies against BPWCP in a letter from Defendants sent to BPWCP and
20
1194164,1

17
SECOND AMENDED COMPLAINT

Case 5:07-cv-04808-JF

Document 37

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Page 23 of 75

1

dated September 12, 2007. A true and correct copy of this letter is attached hereto as
Exhibit P.

2
3

51. By reason of STTN's conduct as described above, BPWCP is

4
5

entitled to a declaratory judgment under 28 D.S.C. Section 2201, stating that:
(a) The relationship between STTN and BPWCP was that of a

6

franchise relationship as defined and provided by Section 2801 of the PMP A;

7
8

(b)' STTN's failure to discharge and comply with the terms,
conditions and obligations of the Franchise Agreements is detailed in the Termination

9 10
11

Notice (Exhibit OJ, constituted a failure to comply with provisions of the franchise
which were reasonable and materially significant, a failure to carr out the provisions
of the franchise, and constituted events which were relevant to the franchise

12
13

relationship, the result of which the franchise termination by BPWCP was reasonable,
under the PMP A;

14
15

(c)

Under the PMPA, BPWCP lawfully terminated STTN's

franchise and franchise relationship concerning the Franchise;
(d)

16 17
18

Under the terms of the Franchise Agreements, BPWCP

lawfully terminated STTN's franchise and franchise relationship concerning the
Franchise;
(e)

19

Under the terms of the Mini Market Agreement, BPWCP

20
21

lawfully terminated STTN's franchise and franchise relationship. concerning the
Station;
cf)

22
23

The Termination Notice was reasonable and appropriate

under 15 D.S.C. § 2802(b)(2)(A) (failure by the franchisee to comply with any

24
25

provision of the franchise which is both reasonable and materially significant to the
franchise relationship); Section 2802(b )(2)(B) (failure by the franchisee to exert good
faith efforts to carr out the provisions of the franchise); Section 2802(b )(2)(C) (the

26
27
28

occurrence of an event which is relevant to the franchise relationship and as a result of
21
1194164,1

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SECOND AMENDED COMPLAINT

Case 5:07-cv-04808-JF

Document 37

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Page 24 of 75

1

which termination of the franchise is reasonable); and Section 2802(c)(9) (failure by
the franchisee to operate the marketing premises for 7 consecutive days);
(g)
Pursuant to 15 USC § 2804(b), BPWCP's Notice of

2
3

4
5

Termination callng for the termination effective immediately was proper because it
would not have been reasonable for BPWCP to furnish 90 days notification;

6 7
8
19.01(d) of

, (h) BPWCP is entitled to liquidated damages under Article
the Mini Market Agreement; and
(i)

BPWCP is entitled to collect any and all other sums due

9
10
11

pursuant to the Franchise Agreements between the parties.

SECOND CLAIM FOR RELIEF

12
13

cBreach of Gasoline Agreement)
cBy P,Iaintiff BPWCP Against STTN Enterprises, Inc.)

14
15

52. The allegations of paragraphs 1 through 51 above are incorporated
herein by reference as though fully set forth herein.
53. BPWCP has fully performed all of its requirements pursuant to the

16
17

parties' Gasoline Agreement.
54.

18

STTN has breached multiple provisions of the Gasoline Agreement

19

by, inter alia:
(a)

20
21

Failing to have any gasoline products available for sale to

the motoring public for at least 15 consecutive days. In fact, STTN had taped off the
Station dispensers from any use by customers, and did not sell any gasoline from

22
23

August 23,2007 through at least September 6, 2007; and

24
25

(b) Failing to timely pay BPWCP for gasoline products in a
timely manner. As of September 6, 2007, STTN had an outstanding balance of One

26
27 28

Hundred Twenty-Six Thousand, One Hundred Ninety-Four Dollars and SeventySeven Cents ($126,194.77) for gasoline product deliveries that were due and payable
19
SECOND AMENDED COMPLAINT

22
1194164,1

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Document 37

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Page 25 of 75

1

at the time of delivery. In fact, STTN issued several checks that were returned by
STTN's bank because STTN had insufficient funds.
55. As a proximate result of STTN's breach, BPWCP has been

2
3

4
5

damaged in an amount to be determined at trial, but no léss than One Hundred Thirt-

Nine Thousand, Nine Hundred Fifty Dollars and Eighty-Seven Cents ($139,950.87),

6
7
8

which is the tot~l outstanding amount due for gasoline product delivered to the
Station, and after applying Defendants' security deposit and other advance payments
as of

May 23, 2008.

9
10
11

THIRD CLAIM FOR RELIEF
cBreach of Mini Market Agreement)

12
13

(By Plaintiff BPWCP Against STTN Enterprises, Inc.) 56. The allegations of paragraphs 1 through 55 above are incorporated
herein by reference as though fully set forth' herein.

14
15

57. BPWCP has fully performed all of its requirements pursuant to the

16
17 18 19

Mini Market Agreement.
58.

STTN has breached Section 4.05 of the Mini Market Agreement

by, inter alia, breaching the Gasoline Agreement, as described in full in the second
claim for relief. Section 4.05 requires that all "Concurrent Operations at the

20
21

Premises" be conducted and governed by the terms and conditions and provisions of
the applicable Franchise Agreement, i.e., the Gasoline Agreement. (See Mini Market
Agreement, Section 4.05 Exhibit B.J
59.

22
23

As a proximate result of STTN's breach, BPWCP has been

24
25

damaged in an amount to be determined at triaL.
60. In addition, the Mini Market Agreement contains a liquidated

26 27 28

damages provision. Aricle 19.01(d) of the Mini Market Agreement provides that
"Operator shall pay to (BWPCP) at the time of termination, as liquidated damages and
not as penalty, the greater of: (a) the total minimum royalty fee which would have
20
23
1194164,1

SECOND AMENDED COMPLAINT

Case 5:07-cv-04808-JF

Document 37

Filed 06/06/2008

Page 26 of 75

1

been payable under the (Mini Market Agreement) from the date of termination of the
(Mini Market Agreement) through the end of the term provided for in the (Mini
Market Agreement); or (b) for each month from the date of termination of the (Mini
Market Agreement) through the end of the term provided in the (Mini Market
Agreement), the actual average royalty fee for any months that the Store was

2
3

4
5

6
7
8

operational prior to termination of the (Mini Market Agreement)." Given BPWCP's

termination of the Mini Market Agreement effective September 6, 2007, the total
amount due to BPWCP for liquidated damages is Two Hundred Thirty-Five Thousand
and Zero Cents ($235,000.00).

9

10
11

FOURTH CLAIM FOR RELIEF
cBreach of Franchise Guaranties)

12
13

cBy Plaintiff BPWCP Against

14
15

Nazim Faquiryan and Sayed Faquiryan.)
61. The allegations of paragraphs 1 through 60 above are incorporateq
herein by reference as though fully set forth herein.

16 17
18

62. Sayed Faquiryan and Nazim Faquiryan each executed and
delivered to BPWCP the Franchise Guaranties, guaranteeing any and all indebtedness

19

of STTN with respect to both the Store Loan Agreement and the Gasoline Loan
Agreement. (See Franchise Guaranties, Exhibit C.)
63.

20
21

STTN is currently indebted to BPWCP in an amount of not less

22
23

than $139,950.87. BPWCP has made demands for payment of this sum on Sayed
Faquiryan and Nazim Faquiryan, who have, to date, failed to make these payments.
As such, Sayed Faquiryan and Nazim Faquiryan are in breach of

24
25

the obligations under

the Franchise Guaranties. Sayed Faquiryan and Nazim Faquiryan are also liable for

26 27
28

liquidated damages in the amount of $235,000.00 owed to BPWCP pursuant to th~

Mini Market Agreement and according to proof.
24
1194164,1

21
SECOND AMENDED COMPLAINT

Case 5:07-cv-04808-JF

Document 37

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Page 27 of 75

1

FIFTH CLAIM FOR RELIEF
cCommon Count: Goods Sold and Delivered)

2
3

cBy Plaintiff BPWCP Against
STTN Enterprises, Inc., Nazim Faquiryan, and Sayed Faquiryan.)

4
5

64. The allegations of paragraphs 1 through 63 above are incorporated
herein by reference as though fully

6
7
8

set forth herein.

65. On or about September 5, 2007, at 631 San Felipe Road, Hollister,

California 95035, Defendants became indebted to BPWCP in the sum of One Hundred
Thirty-Nine Thousand, Nine Hundred Fift Dollars and Eighty-Seven Cents

9
10
11

($139,950.87) for gasoline sold by BPWCP and delivered to STT. 66. BPWCP has repeatedly demanded payment from Defendants. The

12
13

last demand was made on September 6,2007. (See Exhibit 0.)
67. No payment has been made by Defendants to BPWCP, and there is

14
15

now due BPWCP and owed from Defendants at least the principal sum of One
Hundred Thirty-Nine Thousand, Nine Hundred Fifty Dollars and Eighty-Seven Cents
c$139,950.87).

16
17
18

SIXTH CLAIM FOR RELIEF
cUnjust Enrichment)

19

20
21

cBy Plaintiff BPWCP Against

STTN Enterprises, Inc., Nazim Faquiryan, and Sayed Faquiryan.)
68. The allegations of paragraphs 1 through 67 above are incorporated
herein by reference as though fully set forth herein.
69. STTN, as well as Nazim Faquiryan and Sayed Faquiryan as

22
23

24
25

guarantors, obtained the benefit of receiving deliveries of gasoline in that they have

26 27
28

not paid for the gasoline but have been able to sell and profit from the gasoline that
was delivered by BPWCP.

25
1194164,1

22
SECOND AMENDED COMPLAINT

Case 5:07-cv-04808-JF

Document 37

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Page 28 of 75

1

70. On May 4, 2007, Nazim Faquiryan and Sayed Faquiryan sent a
letter agreement to BPWCP, promising that STTN would make monthly payments of
Thirty Thousand Dollars ($30,000) by certified check payable to BPWCP on or before

2
3

4
5

the 15 day of each month beginning June 20, 2007 until the total outstanding balance
owed for the gasoline delivered has been paid off. (See Exhibit N.)

6
7
8

71. . Despite reaping such benefits and agreeing to make monthly
installments, Defendants stil have not made any payments to BPWCP for the gasoline
product.
72. As set forth in the above-paragraphs, Defendants' failure to

9
10
11

compensate BPWCP constitutes unjust enrichment and has damaged BPWCP in the
amount of at least One Hundred Thirty-Nine Thousand, Nine Hundred Fifty Dollars

12
13

and Eighty-Seven Cents ($139,950.87), plus interest.

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SEVENTH CLAIM FOR RELIEF

cBreach of Store Loan Agreement)
cBy Plaintiff BPWCP Against

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STTN Enterprises, Inc., Nazim Faquiryan, and Sayed Faquiryan.)
73. The allegations of paragraphs 1 through 72 above are incorporated
herein by reference as though fully set forth herein.
74. BPWCP has fully performed all of its requirements pursuant to the

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Store Loan Agreement.
75. STTN breached Article 4 of the Store Loan Agreement by failing

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to repay the outstanding balance of the Store Loan in full to BPWCP within 30 days
of the occurrence of an Event of Default. The Store Loan Agreement requires STTN the occurrence of
the Store Loan within 30 days of

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to repay the outstanding balance of

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an Event of Default. The termination of the Franchise Agreements is an Event of

Default. (See Store Loan Agreement, Section 4.5, Exhibit F.)
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76. As of September 5, 2007, the day before the date of termination,
STTN's outstanding balance due on the Loan was $150,000.00. Pursuant to the Store
Loan Agreement, the loan balance was due to BPWCP no later than October 5, 2007.
To date, the loan balance on the Store Loan has not been repaid by Defendants.
77. As a result of STTN's breach of the Store Loan Agreement,

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3

4
5

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8

BPWCP has been damaged in the amount of $150,000, plus interest. In addition, the

Store Loan Agreementprovide that Nazim Faquiryan, Sayed Faquiryan, and Maghul
Faquiryan will reimburse BPWCP on demand for all expenses, including reasonable

9 10
11

attorneys' fees incurred by BPWCP in collecting or enforcing the Store Loan
Agreement, together with interest thereon.
(See Aricle 9.9 of the Store Loan

Agreement, Exhibit F.) It has become necessary for BPWCP to engage the law firm

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of Weston, Benshoof, Rochefort, Rubalcava & MacCuish LLP to bring this action,
and BPWCP is entitled to further and additional sums for reasonable attorneys' fees
herein.

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15

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EIGHTH CLAIM FOR RELIEF
(Breach of Loan Guaranties)

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(By Plaintiff BPWCP Against Nazim Faquiryan, Sayed Faquiryan, and Maghul Faquiryan.)
78. The allegations of paragraphs 1 through 77 above- are incorporated
herein by reference as though fully set forth herein.

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21

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79. Nazim Faquiryan, and Sayed Faquiryan, and Maghul Faquiryan (as

Sayed Faquiryan's spouse), each executed and delivered to BPWCP the Loan
Guaranties, guaranteeing any and all indebtedness of STTN with respect to the Loan

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25

Agreements. (See Loan Guaranties, Exhibit L.) As such, Nazim Faquiryan, Sayed
Faquiryan, and Maghul Faquiryan, as individual guarantors, are liable for damages as
provided by the Store Loan Agreement in the amount of$150,OOO.00 plus interest.

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80. STTN is currently indebted to BPWCP in an amount of not less

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than One Hundred Fift Thousand Dollars ($150,000). BPWCP has made demands
for payment of this sum on Sayed Faquiryan, Nazim Faquiryan, and Maghul
Faquiryan, who have, to date, failed to make these payments.

4
5

As such, Sayed

Faquiryan and Nazim Faquiryan are in breach of the obligations under the Loan

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8

Guaranties. Moreover, Sayed Faquiryan and Nazim Faquiryan are liable for
liquidated damages owed to BPWCP pursuant to the Mini Market Loan Agreement at

the time of the occurrence of an Event of Default and according to proof. Nazim

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F aquiryan, Sayed F aquiryan, and Maghul F aquiryan have breached the Loan
Guaranties.
81.
been damaged in an amount of

As a result of the breaches of the Loan Guaranties, BPWCP has
not less than $150,000 plus interest.

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82.

In addition, the Loan Guaranties provide that Nazim Faquiryan,

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15

Sayed Faquiryan, and Maghul Faquiryan wil reimburse BPWCP on demand for all
expenses, including reasonable attorneys' fees incurred by BPWCP in collecting or

16 17 18

enforcing the Loan Guaranties, together with interest thereon. (See Article 7 of the
Loan Guaranties, Exhibit L.J It has become necessar for BPWCP to engage the law

firm of Weston, Benshoof, Rochefort, Rubalcava & MacCuish LLP to bring this
action, and BPWCP is entitled to further and additional sums for reasonable attorneys'
fees herein.

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NINTH CLAIM FOR RELIEF
cUnified Judicial Foreclosure)

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(By Plaintiff BPWCP Against STTN Enterprises, Inc., and AVA Global Enterprise, LLC.)
83. The allegations of paragraphs 1 through 82 above are incorporated
herein by reference as though fully set forth herein.
84.

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To secure, in part, Defendants' obligations under the Store Loan

Agreement (Exhibit F), Promissory Note (Exhibit J), and Loan Guaranties (Exhibit L),

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and as part of the same transaction, A V A Global, as the owner of the Real Propert,

executed the Deed of Trust dated March 2, 2007 and recorded on March 9, 2007,
which irrevocably granted BPWCP the power of sale of all of ABA Global's right,
title and interest in the Real Propert. A true and correct copy of the Deed of Trust is

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attached hereto as Exhibit H, and is incorporated herein as though fully set forth at
length.

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A V A Global, BPWCP and STTN also entered into a "Consent to

Encu)Jbrance of Tenant's Interest" dated March 2,2 007 and recorded on March 9,
2007 ("Consent to Encumbrance"). The Consent to Encumbrance created a leasehold
mortgage encumbering STTN's leasehold estate in the Lease and Real Propert

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("Leasehold Mortgage"). A true and correct copy of the Consent to Encumbrance is attached hereto as Exhibit I, and is incorporated herein as though fully set forth at
length. In addition, STTN executed a Promissory Note evidencing the Store Loan. A
true and correct copy of the executed Promissory Note is attached hereto as Exhibit J
and is incorporated herein as though fully set forth at length.
85. In addition, Defendants made, executed and delivered to BPWCP,

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as beneficiary, a UCC-L (Exhibit K), by the terms of which Defendants conveyed a

security interest in the personal propert located on or affixed to the Real Propert or
the Improvements thereon for the benefit of BPWCP, as beneficiary. The UCC-L was
filed on May 7, 2007 with the California Secretary of State.
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SECOND AMENDED COMPLAINT

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86.

BPWCP is now, and at all times material to this action was, the
the beneficial interest under the UCC-L.

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3

lawful beneficiary of the Promissory Note, the holder of the beneficial interest under
the Deed of Trust, and the holder of

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5

87.

Excel National Bank, has, or claims to have, some interest in the

Real Propert or some part of it by reason of a senior lien.
88.
the outstanding balance of

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The Store Loan Agreement provides that Defendants must repay
the loan in full to BPWCP within 30 days of

the occurrence

of an "Event of Default." (See Store Loan Agreement, ~ 4, Exhibit F.) The

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termination of the franchise relationship between STTN and BPWCP on September 6,
2007 constituted such a defined "Event of Default." (See Store Loan Agreement,

§ 4.5, Exhibit F.)
89.

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The Promissory Note provides that, if a default or "Event of

Default" (as defined in the Store Loan Agreement, Exhibit F) occurs, then the Note
"shall become immediately due and payable without notice of default, presentment or

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demand for payment, protest or notice of nonpayment or dishonor, or other notices or
demands of any kind or character." (See Promissory Note, ~ 9, Exhibit 1.)

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90. The Loan Guaranties provide that, if the Defendants default in the

full and timely payment of any installment due under the Loan Agreement, the entire
amounts owed to BPWCP wil become immediately payable and due upon demand by
BPWCP. (See Loan Guaranties, ~ 6, Exhibit L.).

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91. BPWCP has fully performed under the Loan Obligation
Agreements. On or about September 6,2007 and September 12,2007, BPWCP made
a demand upon Defendants for the payment of

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these amounts due on October 6, 2007,

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but Defendants have wholly failed, neglected, and refused to make those payments.
(See Exhibits 0 and P.)
92.
As a result of such failure and default under Store Loan

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Agreement, Promissory Note, and the Loan Guaranties by Defendants, BPWCP has
exercised its right to declare the entire sum due from Defendants immediately due and
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payable. The total amount now due under the Store Loan Agreement, Promissory

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Notes, and Loan Guaranties consists of the principal sum of at least One Hundred and
Fifty Thousand Dollars ($150,000), excluding interest and attorneys' fees with respect
thereto.
93. Furthermore, by the provisions of

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5

the Loan Guaranties (Exhibit L;

6 7
8

Paragraph 1), the. Store Loan Agreement (Exhibit F), and the Secured Promissory
Note (Exhibit J), Defendants agreed that, if any action were initiated to enforce the

Loan Guaranties or Loan Agreement, Defendants would pay the sum fixed by the
Court as BPWCP's attorneys' fees and court costs, and that these charges would also
be secured by the Deed of Trust recorded against the Real Property and by the UCC-l

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filed against the personal property located on the Real Property. Because of the
defaults by the Defendants, it has become necessary for BPWCP to emplòy Weston

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Benshoof Rochefort Rubalcava & MacCuish, LLP to commence and prosecute this
foreclosure action. The reasonable value of services of counsel in this action should
be determined by the Court at the time of triaL. As a result of Defendants' default,

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BPWCP is entitled to enforce the Store Loan Agreement, Promissory Note and Loan
Guaranties by, among other things, an unified judicial foreclosure of the Deed of

Trust

as to all of the Defendants' rights in the Real Property, and of the UCC-l as to all of
the Defendants' rights in the personal propert located on the Real Propert, through

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public sale thereof by the proper judicial officer for proceeds up to $150,000 plus
interest and attorneys' fees.
94.

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BPWCP may hereafter be required to expend additional sums to

protect its security in the Real Property described in the Deed of Trust and its security

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in the personal property located on the Real Property described in the UCC-L. In the

Deed of Trust and the UCC-l, Defendants agreed to pay all such sums expended by
BPWCP. BPWCP wil amend this First Amended Complaint to allege the nature and
amounts of such sums if BPWCP is required to make such additional expenditures.
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PRAYERS FOR RELIEF: WHREFORE, BPWCP prays that judgment be entered in its favor as
follows:

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AS TO THE FIRST CLAIM FOR DECLARTORY RELIEF:
1.

F or a declaration that under the PMP A, BPWCP lawfully

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terminated STTN's franchise and franchise relationship pertaining to the Station and
the other requested findings set forth in that claim; and
AS TO THE SECOND CLAIM FOR BREACH OF GASOLINE AGREEMENT:

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2. That BPWCP have judgment against STTN Enterprises, Inc. for

damages arising out of breach of the Gasoline Agreement, in an amount according to

proof, but not less than One Hundred Thirty-Nine Thousand, Nine Hundred Fift
Dollars and Eighty-Seven Cents ($139,950.87); and

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AS TO THE THIRD CLAIM FOR BREACH OF MINI MAT AGREEMENT:
3.

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That BPWCP have judgment against STT Enterprise, Inc. for

damages arising out of breach of the Mini Market Agreement, in an amount according

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to proof including, but not limited to, liquidated damages as provided in the
Agreements in the amount of $235,000.00; and

AS TO THE FOURTH CLAIM FOR BREACH OF FRANCHISE GUARNTIES:
4. For a declaration that Nazim Faquiryan and Sayed Faquiryan, as

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guarantors, are each liable for the same amounts due to BPWCP by STTN Enterprise,

Inc. with respect to the Franchise Agreements and that a deficiency judgment may be
ordered against each of them for those sums;

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5. F or general damages and interest thereon calculated at the
applicable statutory rates; and
AS TO THE FIFTH CLAIM FOR GOODS SOLD AND DELIVERED:
6. For the sum of

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One Hundred Thirt-Nine Thousand, Nine Hundred

Fifty Dollars and Eighty-Seven Cents ($139,950.87);
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7.

F or interest on the sum of One Hundred Thirt-Nine Thousand,
F or costs of suit incurred; and

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Nine Hundred Fifty Dollars and Eighty-Seven Cents ($139,950.87) as allowed by law;
8.

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AS TO THE SIXTH CLAIM FOR UNJUST ENRCHMNT:
9.

F or general damages and interest thereon calculated at the

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applicable statutory rate; and

AS TO THE SEVENTH CLAIM FOR BREACH OF CONTRACT - MINI

MAT LOAN AGREEMENT:
10. For a judgment in favor of

9

BPWCP and against STTN Enterprises,

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Inc. for damages arising out of breach of the Store Loan Agreement, in an amount
according to proof, but in no event less than $150,000.00, plus interest;
11. F or reasonable attorneys' fees and costs incurred herein; and

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AS TO THE EIGHTH CLAIM FOR BREACH