MICHAEL T. STOLLER, ET AL VS. WALL STREET MORTGAGE BANKERS

Tentative Rulings

Case Number: LC102689    Hearing Date: July 29, 2020    Dept: U

SUPERIOR COURT OF THE STATE OF CALIFORNIA

FOR THE COUNTY OF LOS ANGELES - NORTHWEST DISTRICT

Michael T. Stoller and Vanessa Stoller (Plaintiffs) initiated this suit in March 2015 against Wall Street Mortgage Bankers (Wall Street), U.S. Bank, N.A., as Trustee for Adjustable Rate Mortgage Trust 2006-6, Adjustable Rate Mortgaged Back Pass Through Certificates Series 2006-2 (U.S. Bank), Wells Fargo d/b/a American’s Servicing Company (Wells Fargo), and Does 1 through 100, alleging ten causes of action. Plaintiffs filed a first amended complaint (FAC) and a second amended complaint (SAC) alleging breach of contract.

On March 5, 2020, U.S. Bank and Wells Fargo (“Defendants”) filed this motion for terminating sanctions against Plaintiffs pursuant to Code of Civil Procedure sections 2023.010(g), 2023.030(d)(3), 2031.300(c), and 2025.450(h). Defendants move on the grounds that Plaintiffs have failed to comply with the Court’s December 12, 2019 order compelling them to: (1) provide responsive documents to Defendants’ Requests for Production of Documents by February 14, 2020 and (2) complete their depositions and produce documents requested in the deposition notices by February 14, 2020. Defendants request terminating sanctions in the form of dismissing Plaintiffs’ SAC with prejudice.

LEGAL STANDARDS

Where a party willfully disobeys a discovery order, courts have discretion to impose terminating, issue, evidentiary, or monetary sanctions. (Code Civ. Proc., §§ 2023.010(g), 2030.290(c); R.S. Creative, Inc. v. Creative Cotton, Ltd. (1999) 75 Cal.App.4th 486, 495.) Ultimate discovery sanctions are justified where there is a willful discovery order violation, a history of abuse, and evidence showing that less severe sanctions would not produce compliance with discovery rules. (Van Sickle v. Gilbert (2011) 196 Cal.App.4th 1495, 1516.) “[A] penalty as severe as dismissal or default is not authorized where noncompliance with discovery is caused by an inability to comply rather than willfulness or bad faith.” (Brown v. Superior Court (1986) 180 Cal.App.3d 701, 707.) 

The following factors may be relevant in deciding whether and which sanctions to impose for disobedience to discovery orders:

(1) The time that has elapsed since the discovery was served;

(2) Whether the party received extensions of time to answer or respond;

(3) The number of discovery requests and the burden of replying;

(4) The importance of the information sought;

(5) Whether the answering party acted in good faith and with reasonable diligence—i.e., whether he or she was aware of the duty to furnish the requested information and had the ability to do so;

(6) Whether the answers supplied were evasive or incomplete;

(7) The number of questions remaining unanswered;

(8) Whether the unanswered questions sought information that was difficult to obtain;

(9) The existence of prior court orders compelling discovery and the answering party's compliance therewith (Manzetti v. Sup.Ct. (Fitzgerald) (1993) 21 Cal.App.4th 373, 379.);

(10) Whether the party was unable to comply with previous discovery orders;

(11) Whether an order allowing more time to respond would enable the responding party to supply the necessary information; and

(12) Whether some sanction short of dismissal or default would be appropriate to the dereliction.

(Deyo v. Kilbourne (1978) 84 Cal.App.3d 771, 796.)

Pursuant to Code of Civil Procedure section 2023.030(d), the court may impose 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.

The court may order that designated facts “shall be taken as established” by the party adversely affected by the discovery misuse or it may prohibit the party who committed such misuse from supporting or opposing designated claims or defenses. (Code Civ. Proc., § 2023.030(b).) The court may also prohibit the party, or party-affiliated witness, who disobeyed the court order from introducing designated matters in evidence. (Code Civ. Proc., § 2023.030(c); Waicis v. Sup.Ct. (Schwartz) (1990) 226 Cal.App.3d 283, 287.)

Defendants argue Plaintiffs have continually abused the discovery process. Defendants propounded requests for production on Plaintiffs on May 31, 2019, making Plaintiffs’ responses due by July 5, 2019. (Zamora declaration, ¶ 6.) Defendants granted Plaintiffs an extension to reply by July 19, 2019, but when Plaintiffs responded, they did so without the requested documents, so Defendants filed a successful motion to compel. (Ibid.) Despite the Court’s December 12, 2019 order instructing Plaintiffs to produce the requested documents by February 14, 2020, Plaintiffs have failed to comply. (Id. at ¶ 18.) Defendants contend they have attempted to depose Plaintiffs since June 2019. Plaintiffs refused to provide available dates, forcing Defendants to twice unilaterally schedule the depositions. (Id. at ¶¶ 14-15.) Plaintiffs either cancelled or failed to appear at both scheduled depositions. (Id. at ¶ 15.) The Court’s December 12, 2019 order also compelled the Plaintiffs to be deposed by February 14, 2020, but Plaintiffs have not cooperated with this instruction either. (Id. at ¶ 18.) Defense counsel tried to scheduled Plaintiffs’ depositions on dates mutually agreeable for both parties, but, again, was forced to unilaterally schedule the depositions. Plaintiffs cancelled these third scheduled depositions.

Plaintiffs oppose by arguing that they have been unable to produce the requested documents and sit for their depositions because of Ms. Stroller’s chemotherapy treatment compounded by the current COVID-19 pandemic. Mr. Stroller’s time has been spent caring for his wife. Plaintiffs state that they produced the requested documents in their possession and provided deposition dates prior to filing their opposition. Moreover, Plaintiffs contend Defendants have not been prejudiced by the delay because jury trials have been postponed due to the pandemic.

Defendants reply to Plaintiffs’ opposition by arguing that, while Plaintiffs did provide discovery responses and deposition dates prior to filing their opposition, they did so only six minutes prior to filing their opposition. Additionally, Defendants contend that the documents produced by Plaintiffs are not in compliance with Code of Civil Procedure section 2031.280(a), and that they have not produced documents relevant to their contract claim.

More than one year has elapsed since Defendants served Plaintiffs with requests for production and began their attempts to depose Plaintiffs. Defendants have served only two discovery requests on Plaintiffs and granted Plaintiffs an initial extension to respond over one year ago. Plaintiffs do not deny their obligations to respond to Defendants’ discovery requests, but explain that their delays in responding arose because they were dealing with Plaintiff Vanessa Stoller’s 2019 cancer diagnosis which required her to undergo surgery to remove cancerous tumors and to pursue radiation therapy and chemotherapy in 2020. (M. Stoller Declaration, ¶3.) Because of her compromised health, Ms. Stoller has been unavailable for deposition and unable to assist in gathering responsive documents, while Mr. Stoller claims to have devoted most of his time to caring for his wife. (Id., ¶¶ 4-5.) Despite their serious concerns about the threat to Ms. Stoller’s health during the pandemic that is raging, Plaintiffs have now produced the documents that could be located and provided deposition dates to defense counsel. (Id., ¶¶ 6-7.)

Under the circumstances facing Plaintiffs during the last year, and particularly since the order compelling discovery responses issued on December 12, 2019, the Court finds that the motion for terminating sanctions must be denied. An order granting terminating sanctions is a drastic remedy that should be imposed only where a party has engaged in an egregious pattern of discovery abuse or other misconduct. Plaintiffs’ conduct in this case, while non-compliant with an outstanding order and unresponsive for many months to outstanding discovery, does not rise (or descend) to the level of misconduct justifying terminating sanctions. The Court concludes that lesser sanctions are available as an interim step to compel Plaintiffs’ satisfaction of their discovery obligations.

Accordingly, the Court directs Plaintiffs to present themselves for deposition within 30 days of this order and to produce any responsive documents they have within 20 days to allow Defendants sufficient time to review them before the depositions. If Plaintiffs fail to comply with this order to comply with their obligations to provide relevant discovery, the Court will not hesitate to reconsider the conclusion it reached here in the event that Defendants were to file a new motion to terminate this action.

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CONCLUSION

For the foregoing reasons, Defendants’ motion for terminating sanctions is DENIED. The Court orders Plaintiffs to present themselves for deposition within 30 days of this order and to produce any responsive documents they have within 20 days to allow Defendants sufficient time to review them before the depositions.

Defendants are to give notice of the Court’s ruling.

DATED: July 29, 2020

_____________________

Hon. Theresa M. Traber

Judge of the Superior Court