HTL AUTOMOTIVE INC VS PACIFIC LIFT AND EQUIPMENT COMPANY INC

Tentative Rulings

Case Number: BC606821    Hearing Date: April 28, 2021    Dept: 24

Defendant Pacific Lift and Equipment Company, Inc.’s motion for monetary sanctions is GRANTED.

On January 11, 2016, Plaintiff HTL Automotive, Inc. (“HTLA”) and HTL Properties LLC (“HTLP”) (collectively, “Plaintiffs” or “HTL”) filed this breach of contract/fraud action against Pacific Lift and Equipment Company, Inc. (“PLE” or “Defendant”). The operative Third Amended Complaint alleges five causes of action for: 1) breach of contract, 2) breach of the implied covenant of good faith and fair dealing, 3) fraud-concealment, 4) fraud- intentional misrepresentation, and 5) negligent misrepresentation. PLE maintains a cross-complaint against HTLA for breach of contract.

On March 5, 2021, the Court granted Defendant’s Motion to Compel Production of certain records with a production due date of the records by March 22, 2021. The Court also struck HTL’s complaint and answer to the cross-complaint.

On April 2, 2021, Defendant filed the instant motion for Terminating, Evidentiary, Issue, or Monetary Sanctions for failure to comply with the Court’s March order. On April 15, 2021, Plaintiff filed an opposition.

Legal Standard

If a party fails to obey a court order compelling it to provide a discovery response, “the court may make those orders that are just, including the imposition of an issue sanction, an evidence sanction, or a terminating sanction . . . In lieu of or in addition to this sanction, the court may impose a monetary sanction . . . .” (CCP §§ 2030.290(c), 2030.300(e), 2031.300(c), 2031.320(c).) Misuse of the discovery process, which includes disobeying a court order to provide discovery, is conduct subject to sanctions. (CCP § 2023.010(g).) Possible sanctions are:

(a) [A] monetary sanction ordering that one engaging in the misuse of the discovery process, or any attorney advising that conduct, or both pay the reasonable expenses, including attorney's fees, incurred by anyone as a result of that conduct….

(b) [A]n issue sanction ordering that designated facts shall be taken as established in the action in accordance with the claim of the party adversely affected by the misuse of the discovery process. The court may also impose an issue sanction by an order prohibiting any party engaging in the misuse of the discovery process from supporting or opposing designated claims or defenses.

(c) [A]n evidence sanction by an order prohibiting any party engaging in the misuse of the discovery process from introducing designated matters in evidence.

(d) [A] terminating sanction by one of the following orders:

(1) An order striking out the pleadings or parts of the pleadings of any party engaging in the misuse of the discovery process.

(2) An order staying further proceedings by that party until an order for discovery is obeyed.

(3) An order dismissing the action, or any part of the action, of that party.

(4) An order rendering a judgment by default against that party.

(e) [A] contempt sanction by an order treating the misuse of the discovery process as a contempt of court. 

(CCP § 2023.030 [emphasis added].)

The party seeking to impose sanctions need only show the failure to obey earlier discovery orders. (Puritan Ins. Co. v. Superior Court (1985) 171 Cal.App.3d 877, 884 [interpreting former statute dealing with “refusal” to comply].) However, numerous cases hold that severe sanctions (i.e., terminating or evidentiary sanctions) for failure to comply with a court order are allowed only where the failure was willful. (See R.S. Creative, Inc. v. Creative Cotton, Ltd. (1999) 75 Cal.App.4th 486, 495; Vallbona v. Springer (1996) 43 Cal.App.4th 1525, 1545; Biles v. Exxon Mobil Corp. (2004) 124 Cal.App.4th 1315, 1327.) The burden of proof then shifts to the party seeking to avoid sanctions to establish a satisfactory excuse for his or her conduct. (Corns v. Miller (1986) 181 Cal.App.3d 195, 201; Williams v. Russ (2008) 167 Cal.App.4th 1215, 1227.)

Discussion

The record is clear that HTLP is in violation of a court order. HTLP was to produce certain documents requested by Defendant’s RPD, Request No. 68 pursuant to the Court’s March 5 order. HTLP failed to produce these documents by the ordered date of March 22, 2021. (Ortlieb Decl., ¶¶ 20-24, Ex. 13.) In opposition, HTLP shows that they have served the responsive documents on April 15, 2021. HTLP therefore argues that sanctions are improper. The Court agrees that HTLP’s production would be a strong mitigating factor against imposing terminating/issue/evidentiary sanctions. Of course, Plaintiff’s complaint and answer to the cross-complaint have been stricken, rendering those sanctions moot as to HTLA. Further, Plaintiff represented that these documents would be produced over a year ago. (Id., Exs. 10-12.)

In any event, Plaintiff’s discovery misconduct necessitated the instant motion. Sanctions will be determined at the hearing.           Moving party is ordered to give notice. 

Case Number: BC606821    Hearing Date: December 17, 2020    Dept: 24

On January 11, 2016, Plaintiff HTL Automotive, Inc. (“HTLA”) and HTL Properties LLC (“HTLP”) (collectively, “Plaintiffs” or “HTL”) filed this breach of contract/fraud action against Pacific Lift and Equipment Company, Inc. (“PLE” or “Defendant”). The operative Third Amended Complaint alleges five causes of action for: 1) breach of contract, 2) breach of the implied covenant of good faith and fair dealing, 3) fraud-concealment, 4) fraud- intentional misrepresentation, and 5) negligent misrepresentation. PLE maintains a cross-complaint against HTLA for breach of contract.

On June 1, 2020, Defendant filed the instant motion to compel production of documents at the deposition of HTL’s PMK Hooman Nissani. On July 8, 2020, HTL filed a request for continuance because the Secretary of State suspended them. Due to HTL’s suspension by the Tax Board, the Court continued the hearing on this motion and set an OSC re: Suspended Corporate Status on September 28, 2020, to allow Plaintiff to correct this issue. The Court also informed counsel that it would address the calendaring of the motion at the continued date. No additional briefing was submitted. The Court will discuss Plaintiff’s status at the OSC. If this is resolved, then the Court would rule as follows.

Legal Standard

Service of a proper deposition notice obligates a party or “party-affiliated” witness (officer, director, managing agent or employee of party) to attend and testify, as well as produce any document, electronically stored information, or tangible thing for inspection and copying. (CCP § 2025.280(a).) If, after service of a deposition notice, a party deponent fails to appear, testify, or produce documents or tangible things for inspection without having served a valid objection under CCP § 2025.410, the deposing party may move for an order compelling attendance, testimony, and production. (CCP § 2025.450(a).) The motion must be accompanied by a meet and confer declaration, or, when a party deponent fails to attend the deposition, the motion must also be accompanied by a declaration stating that the moving party has contacted the party deponent to inquire about the nonappearance. (CCP § 2025.450(b)(2).) If the deposition notice included a request for production of documents, the motion to compel attendance must also show good cause to justify the production. (CCP § 2025.450(b)(1).

Discussion

Here, the parties stipulated that Nissani would appear for a third volume of his deposition on January 15, 2020. (Ortlieb Decl., Ex. 1.) The Volume III deposition of Hooman Nissani commenced on that date. However, Plaintiff failed to produce responsive documents to Request No. 68. Plaintiff’s counsel, McCreary, indicated that they were in his possession, but was unable to find them. (Ortlieb Decl., ¶¶ 5-6, Ex. 3 at 266:4-9.) McCreary agreed that he would produce the 176 pages responsive to the request within two weeks, on January 29, 2020. (Ortlieb Decl., ¶ 7, Ex. 3 at 305-306.) Plaintiffs failed to produce the records by January 29, 2020, as promised. McCreary sent an email on April 13, 2020, indicating that he would produce them in a matter of days. (Ortlieb Decl., Ex. 6.) Despite the repeated promise, no documents were produced. (Ortlieb Decl., ¶ 11.)

Considering the prior court order requiring compliance with the deposition notice and document requests, as well as the stipulation of the parties and the repeated on-the-record promises to comply, the Court finds good cause to compel their production. The above timeline also demonstrates that the parties adequately met and conferred regarding the documents. Accordingly, Defendant’s motion is GRANTED.

Sanctions

Defendant requests $4,156.65 in sanctions against Plaintiffs. Sanctions are mandatory, unless the Court finds that the one subject to the sanction acted with substantial justification or that other circumstances make the imposition of the sanction unjust. (CCP 2025.450(h), 2025.480(j).) Defendant represents that counsel spent 5.9 hours preparing the moving papers for the Motion and an expected additional 6.7 hours for reply and attending the hearing, billed at a blended rate of $325.00 per hour. A filing fee of $61.65 was paid to reserve the hearing date for the motion. Accordingly, Defendant incurred legal fees and costs of $4,156.65. Based on the moving papers and declaration of counsel, the Court finds this unreasonably high. The motion was relatively simple and there was no opposition. The Court finds that a reasonable sanction would be $536.75.

However, Plaintiffs also do not seem at fault for the discovery dispute at issue. Based on the record, Plaintiffs’ counsel appears at fault. The Court would find it unjust to sanction Plaintiffs for their counsel’s failure to provide documents in his control. However, Defendant did not notice sanctions against Plaintiffs’ counsel, only Plaintiffs individually. (See Notice of Motion.) It would be further unjust, and violate due process, to sanction counsel when no sanctions were noticed against him. Thus, the Court is not inclined to grant sanctions.

Accordingly, the sanctions request is DENIED.

Moving party is ordered to give notice.

Case Number: BC606821    Hearing Date: October 29, 2020    Dept: 24

HTL Properties LLC’s motion to vacate is GRANTED.

Pacific Lift and Equipment Company, Inc.’s motion to compel is DENIED.

On January 11, 2016, Plaintiff HTL Automotive, Inc. (“HTLA”) and HTL Properties LLC (“HTLP”) (collectively, “Plaintiffs”) filed this breach of contract/fraud action against Pacific Lift and Equipment Company, Inc. (“PLE” or “Defendant”). The operative Third Amended Complaint alleges five causes of action for: 1) breach of contract, 2) breach of the implied covenant of good faith and fair dealing, 3) fraud-concealment, 4) fraud- intentional misrepresentation, and 5) negligent misrepresentation. PLE maintains a cross-complaint against HTLA for breach of contract.

On February 10, 2016, PLE filed a cross-Complaint against Hooman Nissani for breach of contract. On June 21, 2019, PLE added HTLP as a roe. On February 20, 2020, the Court granted Plaintiff’s request for entry of default against HTLP, who had not answered.

Before the Court are two motions: a motion to compel production of documents at deposition and a motion to set aside HTLP’s default on the cross-complaint.

On June 1, 2020, Defendant filed a motion to compel production of documents at the deposition of HTL’s PMK Hooman Nissani. On July 8, 2020, Plaintiffs filed a request for continuance because the Secretary of State suspended them. Due to HTL’s suspension by the Tax Board, the Court continued the hearing on this motion and set an OSC re: Suspended Corporate Status on September 28, 2020, to allow Plaintiff to correct this issue.

On August 18, 2020, HTLP filed a motion to vacate the default as to the cross-complaint. On October 16, 2020, PLE filed an opposition and request for sanctions. On October 22, 2020, HTLP filed a reply.

On September 28, 2020, the parties represented that HTL was still suspended. The Court continued the OSCs and motion to October 29, 2020. Because the discovery motion is dependent on HTL’s corporate status, the Court will discuss the status at the OSC prior to ruling. If this is resolved, then the Court would rule as follows below.

Motion to Compel Standard

Service of a proper deposition notice obligates a party or “party-affiliated” witness (officer, director, managing agent or employee of party) to attend and testify, as well as produce any document, electronically stored information, or tangible thing for inspection and copying. (CCP § 2025.280(a).) If, after service of a deposition notice, a party deponent fails to appear, testify, or produce documents or tangible things for inspection without having served a valid objection under CCP § 2025.410, the deposing party may move for an order compelling attendance, testimony, and production. (CCP § 2025.450(a).) The motion must be accompanied by a meet and confer declaration, or, when a party deponent fails to attend the deposition, the motion must also be accompanied by a declaration stating that the moving party has contacted the party deponent to inquire about the nonappearance. (CCP § 2025.450(b)(2).) If the deposition notice included a request for production of documents, the motion to compel attendance must also show good cause to justify the production. (CCP § 2025.450(b)(1).)

Separate Statement

 

CRC Rule 3.1345(a)(5) requires a separate statement for motions to compel production of documents or tangible things at a deposition. Defendant did not supply such a separate statement. Therefore, the Court may deny this motion on this basis.

Compel Documents

A motion to compel production of documents described in a deposition notice must be accompanied by a showing of good cause. (CCP § 2025.450(b)(1).) In other words, the moving party must provide declarations containing specific facts justifying inspection of the documents described in the notice. Courts liberally construe good cause in favor of discovery where facts show the documents are necessary for trial preparation.

Here, Defendant does not provide a declaration supporting good cause. Indeed, Defendant does not argue for good cause. Defendant neither describes the document request, nor provides specific facts justifying inspection of the documents described in the notice. Thus, the motion may be denied on this basis.

Timeliness

The motion to compel must be “made no later than 60 days after the completion of the record of the deposition.” (CCP § 2025.480(b).) This time limit also applies to motions based on a deposition subpoena for production of documents or a business records subpoena. The 60-day time limit runs from the date objections are served because the deposition record is then complete. (Rutledge v. Hewlett-Packard Co. (2015) 238 Cal.App.4th 1164, 1192.)

Here, the deposition was completed on January 15, 2020. (Ortlieb Decl., ¶¶ 5-6.) The instant motion was filed more than 60 days later, on June 1, 2020. Thus, the motion may be denied on this basis.

As the motion is untimely, good cause is not shown, and did not provide the procedurally required statement, Defendant’s motion is DENIED.

Vacate Standard

Relief under section 473(b) is either discretionary or mandatory. A motion for mandatory relief must be made no more than six months after entry of judgment and be accompanied by an attorney’s sworn affidavit attesting to the attorney’s “mistake, inadvertence, surprise or neglect.” (CCP § 473(b).) The attorney affidavit of fault must contain a “straight forward admission of fault.” (State Farm Fire & Casualty Co. v. Pietak (2001) 90 Cal.App.4th 600, 610.) But it need not contain an explanation of the reasons for the attorney’s mistake, inadvertence surprise or neglect. (Martin Potts & Assocs., Inc. v. Corsair, LLC (2016) 244 Cal.App.4th 432, 438-441.)

Relief must be granted “unless the court finds that the default or dismissal was not in fact caused by the attorney's mistake, inadvertence, surprise, or neglect.” (Ibid.) If mandatory relief is granted, the court must “direct the attorney to pay reasonable compensatory legal fees and costs” to the opposing counsel or parties. (CCP § 473(b).)

Where a party cannot obtain an attorney affidavit of fault, the party may seek discretionary relief under section 473(b) due to “mistake, inadvertence, surprise, or excusable neglect.” (CCP § 473(b).) A motion for discretionary relief must be made “within a reasonable time but in no instance exceeding six months after the judgment, dismissal, order, or proceeding was taken.” (Id.) If discretionary relief is granted, the court may in its discretion order the moving party to pay the costs, including attorney fees, incurred in obtaining the default. (Rogalski v. Nabers Cadillac (1992) 11 Cal.App.4th 816, 823; Vanderkous v. Conley (2010) 188 Cal.App.4th 111, 118-119.) If the motion for discretionary relief is granted, the court may order the offending attorney to pay monetary sanctions up to $1,000 to opposing parties, or up to $1,000 to the State Bar Client Security Fund, or “[g]rant other relief as is appropriate.” (CCP § 473(c)(1)(A), (B), (C).)

A motion for relief under section 473(b) “shall be accompanied by a copy of the answer or other pleading proposed to be filed therein, otherwise the application shall not be granted. . .” (CCP § 473(b).) However, this requirement is not jurisdictional; substantial compliance may suffice. (Carmel, Ltd. v. Tavoussi hearing rather than serving it with moving papers].) 

Vacate Discussion

On February 20, 2020, the clerk entered the default against HTLP due to counsel’s failure to file a timely responsive pleading. Counsel inadvertently failed to file an Answer on behalf of HTLP after receipt of the ROE Amendment believing that he had already filed an Answer. (McCreary Decl., ¶ 2.) Counsel did file an Answer on behalf of HTL Automotive, Inc. to the Cross-Complaint earlier in the lawsuit, but he mistakenly failed to file an Answer on behalf of HTL. (Ibid.) HTLP provides their proposed response. Plaintiff takes no issue with the merits, and only requests sanctions.

The Court is inclined to award sanctions, but only those reasonably incurred. PLE states that it incurred $1,690.00 (5.2 hours of legal fees at a blended hourly rate of $325 per hour) in preparing the Request for Entry of Default, correspondence with McCreary to notice the pending Entry of Default, preparation of this Opposition, and attendance at the Motion’s hearing. (Ortlieb Decl., ¶¶ 2-4.) PLE incurred $18.90 in costs. (Ibid.) The Court finds these fees unreasonably high. The Court finds that a reasonable sanction to compensate time spent on the entry of default would be $668.90, inclusive of costs. The Court declines a penalty given the circumstances and lack of prejudice.

Accordingly, HTLP’s motion to vacate is GRANTED, and sanctions are imposed against HTLP’s counsel of record for $668.90.

Moving party is ordered to give notice.

Case Number: BC606821    Hearing Date: September 28, 2020    Dept: 24

On January 11, 2016, Plaintiff HTL Automotive, Inc. (“HTLA”) and HTL Properties LLC (“HTLP”) (collectively, “Plaintiffs” or “HTL”) filed this breach of contract/fraud action against Pacific Lift and Equipment Company, Inc. (“PLE” or “Defendant”). The operative Third Amended Complaint alleges five causes of action for: 1) breach of contract, 2) breach of the implied covenant of good faith and fair dealing, 3) fraud-concealment, 4) fraud- intentional misrepresentation, and 5) negligent misrepresentation. PLE maintains a cross-complaint against HTLA for breach of contract.

On June 1, 2020, Defendant filed the instant motion to compel production of documents at the deposition of HTL’s PMK Hooman Nissani. On July 8, 2020, HTL filed a request for continuance because the Secretary of State suspended them. Due to HTL’s suspension by the Tax Board, the Court continued the hearing on this motion and set an OSC re: Suspended Corporate Status on September 28, 2020, to allow Plaintiff to correct this issue. The Court also informed counsel that it would address the calendaring of the motion at the continued date. No additional briefing was submitted. The Court will discuss Plaintiff’s status at the OSC. If this is resolved, then the Court would rule as follows.

Legal Standard

Service of a proper deposition notice obligates a party or “party-affiliated” witness (officer, director, managing agent or employee of party) to attend and testify, as well as produce any document, electronically stored information, or tangible thing for inspection and copying. (CCP § 2025.280(a).) If, after service of a deposition notice, a party deponent fails to appear, testify, or produce documents or tangible things for inspection without having served a valid objection under CCP § 2025.410, the deposing party may move for an order compelling attendance, testimony, and production. (CCP § 2025.450(a).) The motion must be accompanied by a meet and confer declaration, or, when a party deponent fails to attend the deposition, the motion must also be accompanied by a declaration stating that the moving party has contacted the party deponent to inquire about the nonappearance. (CCP § 2025.450(b)(2).) If the deposition notice included a request for production of documents, the motion to compel attendance must also show good cause to justify the production. (CCP § 2025.450(b)(1).

Discussion

Here, the parties stipulated that Nissani would appear for a third volume of his deposition on January 15, 2020. (Ortlieb Decl., Ex. 1.) The Volume III deposition of Hooman Nissani commenced on that date. However, Plaintiff failed to produce responsive documents to Request No. 68. Plaintiff’s counsel, McCreary, indicated that they were in his possession, but was unable to find them. (Ortlieb Decl., ¶¶ 5-6, Ex. 3 at 266:4-9.) McCreary agreed that he would produce the 176 pages responsive to the request within two weeks, on January 29, 2020. (Ortlieb Decl., ¶ 7, Ex. 3 at 305-306.) Plaintiffs failed to produce the records by January 29, 2020, as promised. McCreary sent an email on April 13, 2020, indicating that he would produce them in a matter of days. (Ortlieb Decl., Ex. 6.) Despite the repeated promise, no documents were produced. (Ortlieb Decl., ¶ 11.)

Considering the prior court order requiring compliance with the deposition notice and document requests, as well as the stipulation of the parties and the repeated on-the-record promises to comply, the Court finds good cause to compel their production. The above timeline also demonstrates that the parties adequately met and conferred regarding the documents. Accordingly, Defendant’s motion is GRANTED.

Sanctions

Defendant requests $4,156.65 in sanctions against Plaintiffs. Sanctions are mandatory, unless the Court finds that the one subject to the sanction acted with substantial justification or that other circumstances make the imposition of the sanction unjust. (CCP 2025.450(h), 2025.480(j).) Defendant represents that counsel spent 5.9 hours preparing the moving papers for the Motion and an expected additional 6.7 hours for reply and attending the hearing, billed at a blended rate of $325.00 per hour. A filing fee of $61.65 was paid to reserve the hearing date for the motion. Accordingly, Defendant incurred legal fees and costs of $4,156.65. Based on the moving papers and declaration of counsel, the Court finds this unreasonably high. The motion was relatively simple and there was no opposition. The Court finds that a reasonable sanction would be $1361.65.

However, Plaintiffs also do not seem at fault for the discovery dispute at issue. Based on the record, Plaintiffs’ counsel appears at fault. The Court would find it unjust to sanction Plaintiffs for their counsel’s failure to provide documents in his control. However, Defendant did not notice sanctions against Plaintiffs’ counsel, only Plaintiffs individually. (See Notice of Motion.) It would be further unjust, and violate due process, to sanction counsel when no sanctions were noticed against him. Thus, the Court is not inclined to grant sanctions.

Accordingly, the sanctions request is DENIED.

Moving party is ordered to give notice.

Case Number: BC606821    Hearing Date: August 07, 2020    Dept: 24

On January 11, 2016, Plaintiff HTL Automotive, Inc. (“HTLA”) and HTL Properties LLC (“HTLP”) (collectively, “Plaintiffs” or “HTL”) filed this breach of contract/fraud action against Pacific Lift and Equipment Company, Inc. (“PLE” or “Defendant”). The operative Third Amended Complaint alleges five causes of action for: 1) breach of contract, 2) breach of the implied covenant of good faith and fair dealing, 3) fraud-concealment, 4) fraud- intentional misrepresentation, and 5) negligent misrepresentation. PLE maintains a cross-complaint against HTLA for breach of contract.

On June 1, 2020, Defendant filed the instant motion to compel production of documents at the deposition of HTL’s PMK Hooman Nissani. On July 8, 2020, HTL filed a request for continuance because the Secretary of State suspended them.

Due to HTL’s suspension by the Tax Board, the Court will continue the instant motion to September 28, 2020 at 8:30 a.m., to allow Plaintiff to correct this issue. The Court will also set an OSC regarding Plaintiff’s suspended status for that same date and will address the calendaring of the motion before the Court.

Moving party is ordered to give notice

Case Number: BC606821    Hearing Date: July 09, 2020    Dept: 24

Defendant Pacific Lift and Equipment Company, Inc.’s motion to compel production of records at the deposition of Hooman Nissani is GRANTED. Sanctions are denied.

On January 11, 2016, Plaintiff HTL Automotive, Inc. (“HTLA”) and HTL Properties LLC (“HTLP”) (collectively, “Plaintiffs” or “HTL”) filed this breach of contract/fraud action against Pacific Lift and Equipment Company, Inc. (“PLE” or “Defendant”). The operative Third Amended Complaint alleges five causes of action for: 1) breach of contract, 2) breach of the implied covenant of good faith and fair dealing, 3) fraud-concealment, 4) fraud- intentional misrepresentation, and 5) negligent misrepresentation. PLE maintains a cross-complaint against HTLA for breach of contract.

On June 1, 2020, Defendant filed the instant motion to compel production of documents at the deposition of HTL’s PMK Hooman Nissani. No opposition was filed.

Legal Standard

Service of a proper deposition notice obligates a party or “party-affiliated” witness (officer, director, managing agent or employee of party) to attend and testify, as well as produce any document, electronically stored information, or tangible thing for inspection and copying. (CCP § 2025.280(a).) If, after service of a deposition notice, a party deponent fails to appear, testify, or produce documents or tangible things for inspection without having served a valid objection under CCP § 2025.410, the deposing party may move for an order compelling attendance, testimony, and production. (CCP § 2025.450(a).) The motion must be accompanied by a meet and confer declaration, or, when a party deponent fails to attend the deposition, the motion must also be accompanied by a declaration stating that the moving party has contacted the party deponent to inquire about the nonappearance. (CCP § 2025.450(b)(2).) If the deposition notice included a request for production of documents, the motion to compel attendance must also show good cause to justify the production. (CCP § 2025.450(b)(1).

Discussion

Here, the parties stipulated that Nissani would appear for a third volume of his deposition on January 15, 2020. (Ortlieb Decl., Ex. 1.) The Volume III deposition of Hooman Nissani commenced on that date. However, Plaintiff failed to produce responsive documents to Request No. 68. Plaintiff’s counsel, McCreary, indicated that they were in his possession, but was unable to find them. (Ortlieb Decl., ¶¶ 5-6, Ex. 3 at 266:4-9.) McCreary agreed that he would produce the 176 pages responsive to the request within two weeks, on January 29, 2020. (Ortlieb Decl., ¶ 7, Ex. 3 at 305-306.) Plaintiffs failed to produce the records by January 29, 2020, as promised. McCreary sent an email on April 13, 2020, indicating that he would produce them in a matter of days. (Ortlieb Decl., Ex. 6.) Despite the repeated promise, no documents were produced. (Ortlieb Decl., ¶ 11.)

Considering the prior court order requiring compliance with the deposition notice and document requests, as well as the stipulation of the parties and the repeated on-the-record promises to comply, the Court finds good cause to compel their production. The above timeline also demonstrates that the parties adequately met and conferred regarding the documents. Accordingly, Defendant’s motion is GRANTED.

Sanctions

Sanctions are mandatory, unless the Court finds that the one subject to the sanction acted with substantial justification or that other circumstances make the imposition of the sanction unjust. (CCP 2025.450(h), 2025.480(j).)

Defendant requests $4,156.65 in sanctions against Plaintiffs.

Defendant represents that counsel spent 5.9 hours preparing the moving papers for the Motion and an expected additional 6.7 hours for reply and attending the hearing, billed at a blended rate of $325.00 per hour. A filing fee of $61.65 was paid to reserve the hearing date for the motion. Accordingly, Defendant incurred legal fees and costs of $4,156.65. Based on the moving papers and declaration of counsel, the Court finds this unreasonably high. The motion was relatively simple and there was no opposition. The Court finds that a reasonable sanction would be $536.75.

However, Plaintiffs also do not seem at fault for the discovery dispute at issue. Based on the record, Plaintiffs’ counsel appears at fault. The Court would find it unjust to sanction Plaintiffs for their counsel’s failure to provide documents in his control. However, Defendant did not notice sanctions against Plaintiffs’ counsel, only Plaintiffs individually. (See Notice of Motion.) It would be further unjust, and violate due process, to sanction counsel when no sanctions were noticed against him. Thus, the Court is not inclined to grant sanctions.

Accordingly, the sanctions request is DENIED.

Moving party is ordered to give notice.

Case Number: BC606821    Hearing Date: November 19, 2019    Dept: 24

Defendant Pacific Lift and Equipment Company, Inc.’s motion for terminating sanctions is GRANTED against Plaintiffs HTL Automotive, Inc. and HTL Properties LLC.

On January 11, 2016, Plaintiff HTL Automotive, Inc. (“HTLA”) and HTL Properties LLC (“HTLP”) (collectively, “Plaintiffs” or “HTL”) filed this breach of contract/fraud action against Pacific Lift and Equipment Company, Inc. (“PLE” or “Defendant”). The operative Third Amended Complaint alleges five causes of action for: 1) breach of contract, 2) breach of the implied covenant of good faith and fair dealing, 3) fraud-concealment, 4) fraud- intentional misrepresentation, and 5) negligent misrepresentation. PLE maintains a cross-complaint against HTLA for breach of contract.

On July 3, 2019, the Court granted Defendant’s motion to compel the deposition of HTL’s PMK Hooman Nissani (“Nissani”). The Court ordered Plaintiffs to produce Nissani by July 18, 2019. On August 9, 2019, the Court granted plaintiffs’ ex parte application to reset the deposition to a mutually agreeable date and continued the trial to March 17, 2020.

On October 8, 2019, Defendant moved for terminating, evidentiary, or monetary sanctions against Plaintiffs for their failure to produce their PMK. On October 18, 2019, HTLA filed an opposition. On October 25, 2019, Defendant filed a reply.

Legal Standard

If a party fails to obey a court order compelling it to provide a discovery response, “the court may make those orders that are just, including the imposition of an issue sanction, an evidence sanction, or a terminating sanction . . . In lieu of or in addition to this sanction, the court may impose a monetary sanction . . . .” (CCP §§ 2030.290(c), 2030.300(e), 2031.300(c), 2031.320(c).) Misuse of the discovery process, which includes disobeying a court order to provide discovery, is conduct subject to sanctions. (CCP § 2023.010(g).) Possible sanctions are:

(a) [A] monetary sanction ordering that one engaging in the misuse of the discovery process, or any attorney advising that conduct, or both pay the reasonable expenses, including attorney's fees, incurred by anyone as a result of that conduct….

(b) [A]n issue sanction ordering that designated facts shall be taken as established in the action in accordance with the claim of the party adversely affected by the misuse of the discovery process. The court may also impose an issue sanction by an order prohibiting any party engaging in the misuse of the discovery process from supporting or opposing designated claims or defenses.

(c) [A]n evidence sanction by an order prohibiting any party engaging in the misuse of the discovery process from introducing designated matters in evidence.

(d) [A] terminating sanction by one of the following orders:

(1) An order striking out the pleadings or parts of the pleadings of any party engaging in the misuse of the discovery process.

(2) An order staying further proceedings by that party until an order for discovery is obeyed.

(3) An order dismissing the action, or any part of the action, of that party.

(4) An order rendering a judgment by default against that party.

(e) [A] contempt sanction by an order treating the misuse of the discovery process as a contempt of court.

(CCP § 2023.030 [emphasis added].)

The party seeking to impose sanctions need only show the failure to obey earlier discovery orders. (Puritan Ins. Co. v. Sup.Ct. (Tri-C Machine Corp.) (1985) 171 Cal.App.3d 877, 884 [interpreting former statute dealing with “refusal” to comply].) However, numerous cases hold that severe sanctions (i.e., terminating or evidentiary sanctions) for failure to comply with a court order are allowed only where the failure was willful. (See R.S. Creative, Inc. v. Creative Cotton, Ltd. (1999) 75 Cal.App.4th 486, 495; Vallbona v. Springer (1996) 43 Cal.App.4th 1525, 1545; Biles v. Exxon Mobil Corp. (2004) 124 Cal.App.4th 1315, 1327.) The burden of proof then shifts to the party seeking to avoid sanctions to establish a satisfactory excuse for his or her conduct. (Corns v. Miller (1986) 181 Cal.App.3d 195, 201; Williams v. Russ (2008) 167 Cal.App.4th 1215, 1227.)

“The trial court may order a terminating sanction for discovery abuse after considering the totality of the circumstances: the conduct of the party to determine if the actions were willful; the detriment to the propounding party; and the number of formal and informal attempts to obtain the discovery.” (Los Defensores, Inc. v. Gomez (2014) 223 Cal.App.4th 377, 390; Lang v. Hochman (2000) 77 Cal.App.4th 1225, 1224 [terminating sanctions by trial court not an abuse of discretion where defendant repeatedly violated court orders to produce records].) “[A] terminating sanction should generally not be imposed until the court has attempted less severe alternatives and found them to be unsuccessful and/or the record clearly shows lesser sanctions would be ineffective.” (Lopez v. Watchtower Bible and Tract Society of New York, Inc. (2016) 246 Cal.App.4th 566, 604 [terminating sanctions order reversed where there was no showing the court could not have obtained compliance by using lesser sanction e.g., issue or evidentiary].) In extreme cases, however, terminating sanctions as a first measure are authorized. (New Albertsons, Inc. v. Superior Court (2008) 168 Cal.App.4th 1403, 1434.)

Discussion

Defendant moves for sanctions based on Plaintiffs’ failure to provide Nassani for his noticed deposition.

The following facts are uncontroverted. The first two sessions of Nissani’s deposition took place on June 21, 2018 and on August 27, 2018, both of which were cut short. (Ortlieb Decl., ¶ 2.) After much cajoling, the parties stipulated to a third deposition on January 17, 2019, with production on January 10, 2019. (Id., Ex. 1.) Nissani did not appear for this deposition, which led to a motion to compel. The Court granted that motion on July 3, 2019 and ordered Plaintiffs to provide Nissani for deposition on July 18, 2019. No records wer eproduced and Nissani failed to appear. Instead, Plaintiffs’ counsel took a trip to New Zealand and the parties rescheduled to an August 9, 2019 deposition date. (Id. ¶ 9.) On August 9, 2019—the date of the agreed upon deposition—Plaintiffs requested that the Court continue the deposition to a mutually agreeable date. (Id. ¶ 11.) At the hearing, Plaintiffs’ counsel agreed to set the deposition for September 4, 2019. As has become a theme, on September 3, 2019, Plaintiffs indicated that the deposition would not go forward. (Id. ¶¶ 12-13.) Plaintiffs offered to have the deposition take place in late October. (Id. ¶¶ 14-15.) Defense Counsel rightfully found this unacceptable.

In their defense, Plaintiffs apparently offered to indemnify Defendant against any loss should Nissani not appear at the deposition again. (McCreary Decl., ¶¶ 2-4.) Plaintiffs also indicate that Nissani is currently injured and is on bed rest. (Id. ¶ 5; Nissani Decl., ¶ 5.)

Upon reviewing the facts provided by both parties, the Court finds that Plaintiffs have willfully disobeyed the Court’s prior orders requiring them to submit their Nassani to a deposition. The evidence incontrovertibly shows willful disobedience of at least the July 3, 2019 court order (as amended by the ex parte application). Based on the record, Plaintiffs have consistently strung Defendant along with regards to Nissani’s deposition. Not only did Nissani fail to complete his previously scheduled depositions (i.e. volumes I and II), but has on numerous times failed to appear to his agreed upon/ordered depositions. Thus, Plaintiffs’ offer for another continued deposition from September 4, 2019 to late October appears insincere.

Plaintiffs do not adequately offer any reason why his depositions did not go forward on any of the above dates. Importantly, Plaintiffs offer no reason why they cancelled the September 2019 deposition date—a date they agreed to. Nissani indicates that his injuries were exacerbated on October 5, 2019 and is now on pain medication. (Nissani Decl., ¶ 4.) This does not explain his failure to appear at the various scheduled depositions in July, August, and September of 2019. This is also inconsistent with their position that the deposition could occur in late October, as presumably Nissani would still be suffering from the effects of his injuries. The Court perform an in-camera review of any medical records that might support Plaintiffs claims of injury and inability to appear at the above discussed depositions.

Given the history of repeated failure to produce records and to appear for the deposition of Nissani, the refusal to comply with the Court’s orders and the age of the case, the Court is inclined to grant terminating sanctions

Accordingly, Defendant’s motion for terminating sanctions is GRANTED.

Moving party is ordered to give notice.

Case Number: BC606821    Hearing Date: October 31, 2019    Dept: 24

Defendant Pacific Lift and Equipment Company, Inc.’s motion for terminating sanctions is GRANTED against Plaintiffs HTL Automotive, Inc. and HTL Properties LLC.

On January 11, 2016, Plaintiff HTL Automotive, Inc. (“HTLA”) and HTL Properties LLC (“HTLP”) (collectively, “Plaintiffs” or “HTL”) filed this breach of contract/fraud action against Pacific Lift and Equipment Company, Inc. (“PLE” or “Defendant”). The operative Third Amended Complaint alleges five causes of action for: 1) breach of contract, 2) breach of the implied covenant of good faith and fair dealing, 3) fraud-concealment, 4) fraud- intentional misrepresentation, and 5) negligent misrepresentation. PLE maintains a cross-complaint against HTLA for breach of contract.

On July 3, 2019, the Court granted Defendant’s motion to compel the deposition of HTL’s PMK Hooman Nissani (“Nissani”). The Court ordered Plaintiffs to produce Nissani by July 18, 2019. On August 9, 2019, the Court granted plaintiffs’ ex parte application to reset the deposition to a mutually agreeable date and continued the trial to March 17, 2020.

On October 8, 2019, Defendant moved for terminating, evidentiary, or monetary sanctions against Plaintiffs for their failure to produce their PMK. On October 18, 2019, HTLA filed an opposition. On October 25, 2019, Defendant filed a reply.

Legal Standard

If a party fails to obey a court order compelling it to provide a discovery response, “the court may make those orders that are just, including the imposition of an issue sanction, an evidence sanction, or a terminating sanction . . . In lieu of or in addition to this sanction, the court may impose a monetary sanction . . . .” (CCP §§ 2030.290(c), 2030.300(e), 2031.300(c), 2031.320(c).) Misuse of the discovery process, which includes disobeying a court order to provide discovery, is conduct subject to sanctions. (CCP § 2023.010(g).) Possible sanctions are:

(a) [A] monetary sanction ordering that one engaging in the misuse of the discovery process, or any attorney advising that conduct, or both pay the reasonable expenses, including attorney's fees, incurred by anyone as a result of that conduct….

(b) [A]n issue sanction ordering that designated facts shall be taken as established in the action in accordance with the claim of the party adversely affected by the misuse of the discovery process. The court may also impose an issue sanction by an order prohibiting any party engaging in the misuse of the discovery process from supporting or opposing designated claims or defenses.

(c) [A]n evidence sanction by an order prohibiting any party engaging in the misuse of the discovery process from introducing designated matters in evidence.

(d) [A] terminating sanction by one of the following orders:

(1) An order striking out the pleadings or parts of the pleadings of any party engaging in the misuse of the discovery process.

(2) An order staying further proceedings by that party until an order for discovery is obeyed.  

(3) An order dismissing the action, or any part of the action, of that party.

(4) An order rendering a judgment by default against that party.  

(e) [A] contempt sanction by an order treating the misuse of the discovery process as a contempt of court.  

(CCP § 2023.030 [emphasis added].)

The party seeking to impose sanctions need only show the failure to obey earlier discovery orders. (Puritan Ins. Co. v. Sup.Ct. (Tri-C Machine Corp.) (1985) 171 Cal.App.3d 877, 884 [interpreting former statute dealing with “refusal” to comply].) However, numerous cases hold that severe sanctions (i.e., terminating or evidentiary sanctions) for failure to comply with a court order are allowed only where the failure was willful. (See R.S. Creative, Inc. v. Creative Cotton, Ltd. (1999) 75 Cal.App.4th 486, 495; Vallbona v. Springer (1996) 43 Cal.App.4th 1525, 1545; Biles v. Exxon Mobil Corp. (2004) 124 Cal.App.4th 1315, 1327.) The burden of proof then shifts to the party seeking to avoid sanctions to establish a satisfactory excuse for his or her conduct. (Corns v. Miller (1986) 181 Cal.App.3d 195, 201; Williams v. Russ (2008) 167 Cal.App.4th 1215, 1227.)

“The trial court may order a terminating sanction for discovery abuse after considering the totality of the circumstances: the conduct of the party to determine if the actions were willful; the detriment to the propounding party; and the number of formal and informal attempts to obtain the discovery.” (Los Defensores, Inc. v. Gomez (2014) 223 Cal.App.4th 377, 390; Lang v. Hochman (2000) 77 Cal.App.4th 1225, 1224 [terminating sanctions by trial court not an abuse of discretion where defendant repeatedly violated court orders to produce records].) “[A] terminating sanction should generally not be imposed until the court has attempted less severe alternatives and found them to be unsuccessful and/or the record clearly shows lesser sanctions would be ineffective.” (Lopez v. Watchtower Bible and Tract Society of New York, Inc. (2016) 246 Cal.App.4th 566, 604 [terminating sanctions order reversed where there was no showing the court could not have obtained compliance by using lesser sanction e.g., issue or evidentiary].) In extreme cases, however, terminating sanctions as a first measure are authorized. (New Albertsons, Inc. v. Superior Court (2008) 168 Cal.App.4th 1403, 1434.)

Discussion

Defendant moves for sanctions based on Plaintiffs’ failure to provide Nassani for his noticed deposition.

The following facts are uncontroverted. The first two sessions of Nissani’s deposition took place on June 21, 2018 and on August 27, 2018, both of which were cut short. (Ortlieb Decl., ¶ 2.) After much cajoling, the parties stipulated to a third deposition on January 17, 2019, with production on January 10, 2019. (Id., Ex. 1.) Nissani did not appear for this deposition, which led to a motion to compel. The Court granted that motion on July 3, 2019 and ordered Plaintiffs to provide Nissani for deposition on July 18, 2019. No records wer eproduced and Nissani failed to appear. Instead, Plaintiffs’ counsel took a trip to New Zealand and the parties rescheduled to an August 9, 2019 deposition date. (Id. ¶ 9.) On August 9, 2019—the date of the agreed upon deposition—Plaintiffs requested that the Court continue the deposition to a mutually agreeable date. (Id. ¶ 11.) At the hearing, Plaintiffs’ counsel agreed to set the deposition for September 4, 2019. As has become a theme, on September 3, 2019, Plaintiffs indicated that the deposition would not go forward. (Id. ¶¶ 12-13.) Plaintiffs offered to have the deposition take place in late October. (Id. ¶¶ 14-15.) Defense Counsel rightfully found this unacceptable.  

In their defense, Plaintiffs apparently offered to indemnify Defendant against any loss should Nissani not appear at the deposition again. (McCreary Decl., ¶¶ 2-4.) Plaintiffs also indicate that Nissani is currently injured and is on bed rest. (Id. ¶ 5; Nissani Decl., ¶ 5.)

Upon reviewing the facts provided by both parties, the Court finds that Plaintiffs have willfully disobeyed the Court’s prior orders requiring them to submit their Nassani to a deposition. The evidence incontrovertibly shows willful disobedience of at least the July 3, 2019 court order (as amended by the ex parte application). Based on the record, Plaintiffs have consistently strung Defendant along with regards to Nissani’s deposition. Not only did Nissani fail to complete his previously scheduled depositions (i.e. volumes I and II), but has on numerous times failed to appear to his agreed upon/ordered depositions. Thus, Plaintiffs’ offer for another continued deposition from September 4, 2019 to late October appears insincere.

Plaintiffs do not adequately offer any reason why his depositions did not go forward on any of the above dates. Importantly, Plaintiffs offer no reason why they cancelled the September 2019 deposition date—a date they agreed to. Nissani indicates that his injuries were exacerbated on October 5, 2019 and is now on pain medication. (Nissani Decl., ¶ 4.) This does not explain his failure to appear at the various scheduled depositions in July, August, and September of 2019. This is also inconsistent with their position that the deposition could occur in late October, as presumably Nissani would still be suffering from the effects of his injuries. 

Given the history of repeated failure to produce records and to appear for the deposition of Nissani, the Court is inclined to grant terminating sanctions. The Court is not currently inclined to grant evidentiary sanctions given the failure to provide a separate statement. (CRC Rule 3.1345(a)(7).) 

Accordingly, Defendant’s motion for terminating sanctions is GRANTED.