Filed 9/1/26 Cueto v. 2 River Labs, Inc. CA3
NOT TO BE PUBLISHED
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
THIRD APPELLATE DISTRICT
(Sacramento)
HIRAM CUETO, C102017
Plaintiff and Appellant,
(Super. Ct. No. 34-2019-
v. 00272280-CU-BC-GDS)
2 RIVER LABS, INC. et al.,
Defendants and Respondents.
Plaintiff Hiram Cueto appeals from the judgment entered after a bench trial on
claims arising out of his investment in and employment with defendant 2 River Labs, Inc.
(2RL). Cueto challenges the ruling on his wrongful termination claim, which was based
on his contention that he was not terminated in compliance with the terms of a buy and
sell agreement. Cueto argues it was error for the trial court to find a breach of that
agreement but not award him damages or order specific performance of the agreement.
We conclude Cueto has forfeited his claims of error and affirm.
FACTUAL AND PROCEDURAL BACKGROUND
We dispense with a detailed recitation of the underlying facts and procedural
background because it is unnecessary to resolve this appeal. Suffice it to say that, in July
2018, Cueto invested in 2RL, a licensed cannabis testing laboratory. As reflected in a
buy and sell agreement, Cueto invested $200,000 in 2RL by purchasing 1,230 shares of
1
stock. Around the same time, 2RL hired Cueto as its lab director and chief science
officer. At some point thereafter, Cueto loaned $45,000 to 2RL. Although Cueto alleged
that, “ultimately,” he would be paid an annual salary of $100,000,1 he conceded at trial
that there was never an agreement he would receive a salary and that he never received a
salary during his employment with 2RL.
After Cueto was terminated in March 2019 due to poor performance, he filed the
instant action against 2RL and two of its shareholders—Matthew Bailey and Michael
Roman (collectively defendants). The operative second amended complaint was filed in
July 2020. It alleged 11 claims for relief, including breach of contract, fraudulent deceit,
breach of fiduciary duty, and non-payment of wages.
Prior to the commencement of trial, the trial court ruled that Cueto could pursue a
claim for wrongful termination in violation of the terms of the buy and sell agreement
and a claim for failure to purchase shares, as alleged for the first time in Cueto’s pretrial
brief. In connection with this ruling, the trial was continued to allow 2RL the opportunity
to depose Cueto for an additional day on the subject of whether there was a breach of the
buy and sell agreement.
Following a three-day bench trial in July and October 2023 and the submission of
posttrial briefing, the trial court issued a detailed written decision. As for the merits of
Cueto’s claims, the trial court generally ruled in favor of defendants, with two exceptions
relevant to this appeal. First, the court found that Cueto had been terminated in a manner
that did not comply with the terms of the buy and sell agreement.2 The court, however,
1 According to Cueto, he was going to start receiving a salary “whenever [2RL] was
profitable and able to pay that money.”
2 Specifically, the trial court found that Cueto was terminated in violation of the
provision which specified that a shareholder would be given three attempts over the
course of 180 days to rectify performance related issues, and that a mediator would make
the final determination as to the removal of a shareholder.
2
determined that Cueto was not entitled to damages because he had not been paid during
his employment with 2RL.3 The court further determined that Cueto was not entitled to
specific performance of the terms of his “employment contract” (i.e., the buy and sell
agreement).4 Second, the trial court found that 2RL had failed to purchase Cueto’s shares
of stock upon his termination as required under the terms of the buy and sell agreement,
and that Cueto was entitled to recover the amount he loaned to 2RL—$45,000. As a
result, the court concluded that Cueto was entitled to an aggregate sum of $245,000, plus
10 percent interest.5
After judgment was entered in July 2024, Cueto timely appealed. Cueto did not
file a reply brief.
DISCUSSION
Cueto argues the trial court erred in determining that he was not entitled to
damages or specific performance as a remedy for his wrongful termination in violation of
the terms of the buy and sell agreement. As we explain next, Cueto has forfeited his
appellate contentions.
3 Cueto sought damages “at either $95,000 per year or $140,000,” the latter of
which was the salary the other shareholders—Roman and Bailey—“began receiving in
October 2020,” more than a year and a half after Cueto was terminated.
4 In so finding, the trial court cited Scott v. Pacific Gas & Electric Co. (1995) 11
Cal.4th 454 and Civil Code section 3390, for the proposition that “an employee is
generally not entitled to compel the specific performance of the terms of an employment
contract, absent statutory authorization.” (See Scott, at p. 473; Civ. Code, § 3390 [listing
the obligations that cannot be specifically enforced].) The court also found that Cueto
had “not proven he has met all the elements for specific performance.”
5 As part of its written decision, the trial court found that Cueto was “not a credible
witness.” In so finding, the court noted that Cueto’s testimony was “rambling,” “difficult
to understand,” and included contradictions. By contrast, the court found that Roman and
Bailey (2RL shareholders) were credible witnesses, explaining that their testimony was
“clear and direct.” The court also found that the person hired to replace Cueto as the new
lab director—Renee Engle-Goodner—was “a thoughtful and credible witness.”
3
I
Appellate Rules of Procedure
Well-established principles of appellate review guide our analysis. “[I]t is a
fundamental principle of appellate procedure that a trial court judgment is ordinarily
presumed to be correct and the burden is on an appellant to demonstrate, on the basis of
the record presented to the appellate court, that the trial court committed an error that
justifies reversal of the judgment. [Citations.] ‘This is not only a general principle of
appellate practice but an ingredient of the constitutional doctrine of reversible error.’ ”
(Jameson v. Desta (2018) 5 Cal.5th 594, 608-609.)
In order to secure the reversal of an adverse judgment, it is not enough for the
appellant to establish that the trial court committed some error; the appellant must also
affirmatively demonstrate the error complained of was prejudicial. (Cal. Const., art. VI,
§ 13; F.P. v. Monier (2017) 3 Cal.5th 1099, 1108; see In re Marriage of McLaughlin
(2000) 82 Cal.App.4th 327, 337 [“ ‘The burden is on the appellant in every case to show
that the claimed error is prejudicial; i.e., that it has resulted in a miscarriage of
justice’ ”].) Error is prejudicial when “ ‘it is reasonably probable that a result more
favorable to the appealing party would have been reached in the absence of the error.’ ”
(Cassim v. Allstate Ins. Co. (2004) 33 Cal.4th 780, 800.)
A party challenging a judgment “has the burden of showing reversible error by an
adequate record.” (Ballard v. Uribe (1986) 41 Cal.3d 564, 574.) “ ‘ “A necessary
corollary to this rule is that if the record is inadequate for meaningful review, the
appellant defaults and the decision of the trial court should be affirmed.” ’ ” (Jameson v.
Desta, supra, 5 Cal.5th at p. 609.) Thus, where the appellant fails to provide an adequate
record as to any issue the appellant has raised on appeal, the issue must be resolved
against the appellant. (Maria P. v. Riles (1987) 43 Cal.3d 1281, 1295-1296.)
4
The burden of overcoming the presumption of correctness includes the obligation
to present argument and legal authority on each point raised. This requires more than
simply stating a bare assertion that the judgment or challenged order is erroneous and
leaving it to the appellate court to figure out why; it is not the appellate court’s role to
construct theories or arguments that would undermine the judgment or order and defeat
the presumption of correctness. (Dilbert v. Newsom (2024) 101 Cal.App.5th 317, 323;
see also Allen v. City of Sacramento (2015) 234 Cal.App.4th 41, 52.) An “appellant must
present meaningful legal analysis supported by citations to authority and citations to facts
in the record that support the claim of error.” (In re S.C. (2006) 138 Cal.App.4th 396,
408.) When an appellant asserts a point but fails to support it with reasoned argument
and citations to pertinent authority, the court may treat it as waived or forfeited.
(People v. Stanley (1995) 10 Cal.4th 764, 793.)
II
Analysis
We conclude Cueto has forfeited his appellate contentions. As an initial matter,
the record is inadequate. In designating the record on appeal, Cueto elected to provide us
with a reporter’s transcript and an appendix in lieu of a clerk’s transcript. In doing so, he
did not designate certain essential documents to be included in the appendix. For
example, the appellate record does not include the parties’ pretrial and posttrial briefs,
which the parties agreed would be a substitute for opening and closing statements. Nor
does the record include the motions in limine filed by defendants or the 20 trial exhibits
admitted into evidence.6
6 The record includes a document purporting to be the buy and sell agreement
executed by the parties. However, the document lacks an exhibit marking. As a result,
we do not know whether it is an accurate copy of the buy and sell agreement admitted
into evidence by the trial court.
5
In addition to providing us with an incomplete record, Cueto filed an inadequate
opening brief and did not file a reply brief. Cueto’s opening brief does not include any
meaningful legal analysis, supported by citation to pertinent authority and evidence in the
record, showing how and why the trial court prejudicially erred. Indeed, the legal
argument portion of Cueto’s brief cites no legal authority. The only case cited appears in
the portion of the brief summarizing the trial court’s decision, and the only statute cited
appears in the statement of appealability portion of the brief. Consequently, no further
discussion of his arguments is required.
It is not our role as an appellate court to construct arguments for appellants that
would undermine the judgment and defeat the presumption of correctness. (Siskiyou
Hospital v. County of Siskiyou (2025) 109 Cal.App.5th 14, 39.) Rather, where, as here,
the appellant’s opening brief makes contentions unsupported by citation to legal
authority, we may treat the contentions as forfeited. (County of Sacramento v. Singh
(2021) 65 Cal.App.5th 858, 861; see also Hernandez v. First Student, Inc. (2019) 37
Cal.App.5th 270, 277 [we may and do disregard conclusory arguments that are not
supported by pertinent legal authority.)
In sum, there is no basis for reversal. Cueto did not carry his burden to overcome
the presumption of correctness. He did not cite or apply any legal authority showing how
and why the trial court committed prejudicial error. We will affirm.7
7 Because Cueto has forfeited his appellate contentions, we need not and do not
consider any of the other issues raised by the parties. For the same reason, we deny
defendants’ request for judicial notice, which asked us to consider matters (i.e., Web site
& document) related to the cancellation of 2RL’s license to test cannabis. (See Save
Lafayette Trees v. East Bay Regional Park Dist. (2021) 66 Cal.App.5th 21, 29, fn. 2
[request for judicial notice properly denied where additional documents or information
are unnecessary to resolve the appeal].) We also deny defendants’ alternative request for
us to consider these matters “as documentary evidence in this appeal.”
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DISPOSITION
The judgment is affirmed. Defendants shall recover their costs on appeal. (Cal.
Rules of Court, rule 8.278(a).)
/s/
WISEMAN, J.
We concur:
/s/
ROBIE, Acting P. J.
/s/
MESIWALA, J.
Retired Associate Justice of the Court of Appeal, Fifth Appellate District, assigned by
the Chief Justice pursuant to article VI, section 6 of the California Constitution.
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