This case was last updated from Los Angeles County Superior Courts on 05/26/2019 at 00:47:14 (UTC).

CESAR ROMERO ET AL VS FIRST AMERICAN TITLE COMPANY ET AL

Case Summary

On 04/06/2017 CESAR ROMERO filed a Contract - Insurance lawsuit against FIRST AMERICAN TITLE COMPANY. This case was filed in Los Angeles County Superior Courts, Stanley Mosk Courthouse located in Los Angeles, California. The Judges overseeing this case are SAMANTHA P. JESSNER, BARBARA M. SCHEPER and YOLANDA OROZCO. The case status is Pending - Other Pending.
Case Details Parties Documents Dockets

 

Case Details

  • Case Number:

    ****6649

  • Filing Date:

    04/06/2017

  • Case Status:

    Pending - Other Pending

  • Case Type:

    Contract - Insurance

  • County, State:

    Los Angeles, California

Judge Details

Presiding Judges

SAMANTHA P. JESSNER

BARBARA M. SCHEPER

YOLANDA OROZCO

 

Party Details

Plaintiffs

ROMERO TATANA S.

ROMERO CESAR

Defendants

FIRST AMERICAN TITLE COMPANY

MAYOSKY MEREDITH BARNES

BOSS DAVID G.

WOOTTON ELIZABETH A.

PROMINENT ESCROW SERVICES INC.

Attorney/Law Firm Details

Plaintiff Attorneys

BUCHALTER APC

BUILDERS LAW GROUP

DYE PAUL T

Defendant Attorneys

EARLY SULLIVAN WRIGHT GIZER & MCRAE LLP

MANNING & KASS ELLROD RAMIREZ TRESTER LLP

RICHARD D. MARKS PC

ROSEN JESSICA

BOSWELL LISA L

GIZER SCOTT E

GIDDING ZACHARY A.

CHA JEAN H

 

Court Documents

SUPPLEMENTAL DECLARATION OF PLAINTIFF CESAR ROMERO FILED IN SUPPORT OF HIS MOTIONS TO COMPEL FURTHER RESPONSES FROM DEFENDANTS FIRST AMERICAN TITLE INSURANCE COMPANY ("FATIC") AND FIRST AMERICAN TITLE

2/22/2018: SUPPLEMENTAL DECLARATION OF PLAINTIFF CESAR ROMERO FILED IN SUPPORT OF HIS MOTIONS TO COMPEL FURTHER RESPONSES FROM DEFENDANTS FIRST AMERICAN TITLE INSURANCE COMPANY ("FATIC") AND FIRST AMERICAN TITLE

DECLARATION OF MARY C.G. KAUFMAN RE: INABILITY TO COMPLY WITH MEET AND CONFER REQUIREMENT ETC.

2/26/2018: DECLARATION OF MARY C.G. KAUFMAN RE: INABILITY TO COMPLY WITH MEET AND CONFER REQUIREMENT ETC.

DECLARATION OF JEFFREY TSAO PURSUANT TO CODE OF CIVIL PROCEDURE SECTION 430.41, SUBDIVISION (A)(2)

3/2/2018: DECLARATION OF JEFFREY TSAO PURSUANT TO CODE OF CIVIL PROCEDURE SECTION 430.41, SUBDIVISION (A)(2)

DEFENDANTS FIRST AMERICAN TITLE INSURANCE COMPANY AND FIRST AMERICAN TITLE COMPANY'S OMNIBUS OPPOSITION TO PLAINTIFF CESAR RONIERO'S SIX MOTIONS TO COMPEL FURTHER RESPONSES TO DISCOVERY AND REQUEST FO

3/5/2018: DEFENDANTS FIRST AMERICAN TITLE INSURANCE COMPANY AND FIRST AMERICAN TITLE COMPANY'S OMNIBUS OPPOSITION TO PLAINTIFF CESAR RONIERO'S SIX MOTIONS TO COMPEL FURTHER RESPONSES TO DISCOVERY AND REQUEST FO

REPLY TO DEFENDANTS FIRST AMERICAN TITLE INSURANCE COMPANY AND FIRST AMERICAN TITLE COMPANY OPPOSITION TO PLAINTIFF CESAR ROMERO'S SIX MOTIONS TO COMPEL; DECLARATION OF CESAR ROMERO

3/9/2018: REPLY TO DEFENDANTS FIRST AMERICAN TITLE INSURANCE COMPANY AND FIRST AMERICAN TITLE COMPANY OPPOSITION TO PLAINTIFF CESAR ROMERO'S SIX MOTIONS TO COMPEL; DECLARATION OF CESAR ROMERO

ORDER RE MOTIONS TO COMPEL FURTHER RESPONSES

3/16/2018: ORDER RE MOTIONS TO COMPEL FURTHER RESPONSES

Minute Order

3/16/2018: Minute Order

DECLARATION

4/2/2018: DECLARATION

NOTICE OF MOTION AND MOTION OF DEFENDANT PROMINENT ESCROW SERVICES, INC. TO STRIKE PORTIONS OF THE SECOND AMENDED COMPLAINT; MEMORANDUM OF POINTS AND AUTHORITIES

4/2/2018: NOTICE OF MOTION AND MOTION OF DEFENDANT PROMINENT ESCROW SERVICES, INC. TO STRIKE PORTIONS OF THE SECOND AMENDED COMPLAINT; MEMORANDUM OF POINTS AND AUTHORITIES

DEFENDANT?S NOTICE OF DEMURRER AND DEMURRER TO THE SECOND AMENDED COMPLAINT; MEMORANDUM OF POINTS AND AUTHORITIES

4/2/2018: DEFENDANT?S NOTICE OF DEMURRER AND DEMURRER TO THE SECOND AMENDED COMPLAINT; MEMORANDUM OF POINTS AND AUTHORITIES

DECLARATION

4/2/2018: DECLARATION

DEFENDANTS FIRST AMERICAN TITLE COMPANY?S AND FIRST AMERICAN TITLE INSURANCE COMPANY?S NOTICE OF MOTION TO STRIKE AND/OR SEAL, AND MEMORANDUM OF POINTS AND AUTHORITIES AND DECLARATION OF MARY C.G. KAU

4/10/2018: DEFENDANTS FIRST AMERICAN TITLE COMPANY?S AND FIRST AMERICAN TITLE INSURANCE COMPANY?S NOTICE OF MOTION TO STRIKE AND/OR SEAL, AND MEMORANDUM OF POINTS AND AUTHORITIES AND DECLARATION OF MARY C.G. KAU

DEFENDANTS FIRST AMERICAN TITLE COMPANY'S AND FIRST AMERICAN TITLE INSURANCE COMPANY'S NOTICE OF EX PARTE APPLICATION, AND MEMORANDUM OF POINTS AND AUTHORITIES AND DECLARATIONS OF MARY C.G. KAUFMAN AN

4/11/2018: DEFENDANTS FIRST AMERICAN TITLE COMPANY'S AND FIRST AMERICAN TITLE INSURANCE COMPANY'S NOTICE OF EX PARTE APPLICATION, AND MEMORANDUM OF POINTS AND AUTHORITIES AND DECLARATIONS OF MARY C.G. KAUFMAN AN

NOTICE OF EX PARTE APPLICATION TO ADVANCE THE DATE FOR HEARING ON PLAINTIFF'S MOTION TO COMPEL FURTHER RESPONSES TO PLAINTIFF'S REQUEST FOR PRODUCTION OF DOCUMENTS REQUEST FROM FIRST AMERICAN DEFENDAN

4/11/2018: NOTICE OF EX PARTE APPLICATION TO ADVANCE THE DATE FOR HEARING ON PLAINTIFF'S MOTION TO COMPEL FURTHER RESPONSES TO PLAINTIFF'S REQUEST FOR PRODUCTION OF DOCUMENTS REQUEST FROM FIRST AMERICAN DEFENDAN

DEFENDANTS FIRST AMERICAN TITLE COMPANY'S AND FIRST AMERICAN TITLE INSURANCE COMPANY'S BLIND OPPOSITION TO PLAINTIFFS' EX PARTE APPLICATION; DECLARATION OF MARY C.G. KAUFMAN IN SUPPORT THEREOF

4/11/2018: DEFENDANTS FIRST AMERICAN TITLE COMPANY'S AND FIRST AMERICAN TITLE INSURANCE COMPANY'S BLIND OPPOSITION TO PLAINTIFFS' EX PARTE APPLICATION; DECLARATION OF MARY C.G. KAUFMAN IN SUPPORT THEREOF

NOTICE OF CONTINUANCE OF DEFENDANT'S DEMURRER AND MOTION TO STRIKE TO PLAINTIFFS' SECOND AMENDED COMPLAINT

4/11/2018: NOTICE OF CONTINUANCE OF DEFENDANT'S DEMURRER AND MOTION TO STRIKE TO PLAINTIFFS' SECOND AMENDED COMPLAINT

PLAINTIFFS' OPPOSITION TO FIRST AMERICAN'S EX PARTE APPLICATION SEEKING A MOTION TO STRIKE AND/OR SEAL DOCUMENTS PURPOSELY RELEASED BY FIRST AMERICAN DEFENDANTS; DECLARATION OF CESAR ROMERO

4/11/2018: PLAINTIFFS' OPPOSITION TO FIRST AMERICAN'S EX PARTE APPLICATION SEEKING A MOTION TO STRIKE AND/OR SEAL DOCUMENTS PURPOSELY RELEASED BY FIRST AMERICAN DEFENDANTS; DECLARATION OF CESAR ROMERO

Minute Order

4/11/2018: Minute Order

215 More Documents Available

 

Docket Entries

  • 05/17/2019
  • Docketat 08:30 AM in Department 31, Yolanda Orozco, Presiding; Hearing on Motion to Compel Further Discovery Responses - Not Held - Taken Off Calendar by Party

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  • 05/10/2019
  • DocketSeparate Statement; Filed by no Erroneously Sued As First American Title Company (Defendant)

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  • 05/10/2019
  • DocketDeclaration (in Support of Motion to Compel Further Responses to Form Interrogatories, Set Two); Filed by no Erroneously Sued As First American Title Company (Defendant)

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  • 05/10/2019
  • DocketMotion to Compel Further Discovery Responses; Filed by no Erroneously Sued As First American Title Company (Defendant)

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  • 05/10/2019
  • DocketSeparate Statement; Filed by no Erroneously Sued As First American Title Company (Defendant)

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  • 05/10/2019
  • DocketMotion to Compel Further Discovery Responses; Filed by no Erroneously Sued As First American Title Company (Defendant)

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  • 05/10/2019
  • DocketDeclaration (In Support of Motion to Compel Further Responses to Special Interrogatories, Set 3); Filed by no Erroneously Sued As First American Title Company (Defendant)

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  • 05/10/2019
  • DocketSeparate Statement; Filed by no Erroneously Sued As First American Title Company (Defendant)

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  • 05/10/2019
  • DocketMotion to Compel Further Discovery Responses; Filed by no Erroneously Sued As First American Title Company (Defendant)

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  • 05/10/2019
  • DocketDeclaration (in Support of Motion to Compel Further Responses to Requests for Admission, Set Two); Filed by no Erroneously Sued As First American Title Company (Defendant)

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626 More Docket Entries
  • 05/17/2017
  • DocketPROOF OF SERVICE SUMMONS

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  • 05/17/2017
  • DocketPROOF OF SERVICE SUMMONS

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  • 05/17/2017
  • DocketPROOF OF SERVICE SUMMONS

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  • 04/11/2017
  • DocketNOTICE OF CASE MANAGEMENT CONFERENCE

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  • 04/11/2017
  • DocketNotice of Case Management Conference; Filed by Clerk

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  • 04/11/2017
  • DocketOSC-Failure to File Proof of Serv; Filed by Clerk

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  • 04/11/2017
  • DocketORDER TO SHOW CAUSE HEARING

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  • 04/06/2017
  • DocketCOMPLAINT FOR DAMAGES BAD FAITH ;ETC

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  • 04/06/2017
  • DocketComplaint; Filed by Cesar Romero (Plaintiff); Tatana S. Romero (Plaintiff)

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  • 04/06/2017
  • DocketSUMMONS

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Tentative Rulings

Case Number: ****6649    Hearing Date: December 15, 2020    Dept: 31

MOTION FOR PROTECTIVE ORDER IS DENIED.

Background

Plaintiffs Cesar Romero (“Cesar”) and Tatana Romero (“Tatana”) sued Defendants First American Title Insurance Company (hereinafter “FATIC”), First American Title Company, and Prominent Escrow Services, Inc. for compensatory and injunctive relief, based on allegations that Plaintiffs’ non-party neighbor’s home improvements encroached onto Plaintiffs’ property. Plaintiffs also claim that FATIC, which provided Plaintiffs’ title insurance, acted in bad faith by improperly favoring Plaintiffs’ neighbors, “Shih/Ko,” in the dispute over the alleged encroachment and failed to pay Plaintiffs adequate damages to compensate for the diminution in value of their property caused by the encroachment. In the operative Second Amended Complaint (“SAC”), Plaintiffs assert causes of action for:

  1. Breach of Contract by Escrow Agents and Fiduciaries for Failure to Comply with Instructions;

  2. Negligence by Escrow Agents and Fiduciaries in the Performance of Their Duties;

  3. Breach of Fiduciary Duty;

  4. Damages for Negligent Representation;

  5. Damages for Fraud;

  6. Breach of Insurance Contract;

  7. Breach of the Duty of Good Faith and Fair Dealing; and

  8. Unfair Business Practices.

    The sixth, seventh, and eighth causes of action are pending against FATIC because the Court sustained FATIC’s demurrer to the first, second, third, fourth, and fifth causes of action without leave to amend on May 9, 2018. Also as a result of sustaining the demurrer without leave to amend on May 9, 2019, Defendant First American Title Company was dismissed with prejudice, as the first through fifth causes of action were the only ones asserted against it. On January 31, 2019, Plaintiffs dismissed Defendant Prominent Escrow Services, Inc. with prejudice.

    FATIC now moves for a protective order barring Plaintiffs from obtaining the deposition transcript of Debra Look taken in the action Balaz v. First American Title Insurance Company, San Diego County Case No. 37-2013-00058789 or making use of that transcript in this action.

    Legal Standard

    “The court, for good cause shown, may make any order that justice requires to protect any party, deponent, or other natural person or organization from unwarranted annoyance, embarrassment, or oppression, or undue burden and expense.” (Code Civ. Proc., ; 2025.420(b).) Courts have considerable discretion in granting and crafting protective orders. (Raymond Handling Concepts Corp. v. Superior Court (1995) 39 Cal.App.4th 584, 588.)

    Request for Judicial Notice

The court may take judicial notice of “official acts of the legislative, executive, and judicial departments of the United States and of any state of the United States,” “[r]ecords of (1) any court of this state or (2) any court of record of the United States or of any state of the United States,” and “[f]acts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” (Evid. Code ; 452, subds. (c), (d), and (h).) 

FATIC requests that the Court take judicial notice of a number of documents filed and actions taken in San Diego County Superior Court Case no. 37-2013-00058789, Balaz v. First American Title Insurance Company, documents filed in this action, and the fact that discovery in this matter closed on December 30, 2019. The request is GRANTED.

Evidentiary Objections

Plaintiffs submit a number of evidentiary objections to the Declaration of Zachary Gidding.

Objection Nos. 2, 4, 6, 12, 16-19 – OVERRULED 

The remaining objections are immaterial to the Court’s disposition. The Court thus declines to rule upon them.

Similarly, FATIC submits a number of evidentiary objections to the Declaration of Cesar Romero. The objections are immaterial to the Court’s disposition. The Court thus declines to rule upon them.

Discussion

FATIC moves for a protective order barring Plaintiffs from obtaining the deposition transcript of Debra Look taken in the action Balaz v. First American Title Insurance Company, San Diego County Case No. 37-2013-00058789 or making use of that transcript in this action.

The Court notes at the outset that a motion for protective order is not the appropriate procedure for requesting that a document or particular evidence be excluded from use at trial. Such a request is more appropriately suited for a motion in limine. Accordingly, the Court disregards FATIC’s arguments to the extent it argues that Plaintiffs should be barred from using the deposition transcript at trial.

Moreover, the Court notes that Plaintiffs dedicate a quarter of their opposition to setting forth arguments and information not pertinent to the motion and often not supported by evidence. As previously stated in this Court’s July 2, 2020 Minute Order, the page limitations set forth in the Code of Civil Procedure and the California Rules of Court are not an invitation for Plaintiffs to set forth any and all arguments or grievances they may have against an opposing party, especially when such arguments are not pertinent to the resolution of the issues before the Court. The parties are admonished to strictly comply with all statutes and rules that apply to this Court, including the Guidelines for Civility in Civil Litigation. The Court thus disregards the Plaintiffs’ opposition to the extent that the arguments set forth are not pertinent to the resolution of the motion.

FATIC argues that over six months after the close of discovery, Plaintiffs are seeking to obtain the deposition of Debra Look (“Look”), a claims supervisor with FATIC, who was a witness in a prior bad faith action against FATIC. FATIC asserts that Look was not involved in the handling of Plaintiffs’ claim nor did she having anything to do with this case, rendering her deposition transcript entirely irrelevant. FATIC contends that this is confirmed by Plaintiffs’ complete disinterest in deposing Look at any time during discovery in this case. FATIC argues that Plaintiffs have been aware of the Balaz case since at least November 2017, when they referenced it in their First Amended Complaint, but have not sought this deposition transcript until half a year after the close of discovery, in the midst of a pandemic, when FATIC is unable to take further discovery on whatever matters Plaintiffs may raise based on the Balaz case. FATIC asserts that rather than impose on FATIC the burden of prejudice that would result from Plaintiffs’ request for the transcript the Court should issue a protective order directing that Plaintiffs cannot obtain the transcript or use it in this case.

FATIC contends that per Balaz’s complaint, Debra Look was the direct supervisor of Mickey Adkinson, who was handling Balaz’s claim, and personally approved Adkinson’s handling of the claim which led to the litigation. (RJN ¶ 2, Exh. 2 (Balaz Complaint) ¶ 91, 150.) FATIC argues that Look did not testify at trial and there is no indication that her deposition testimony was ever presented to the jury or factored into its verdict. (RJN ¶ 6, Exh. 6.) FATIC asserts that Plaintiffs never sought to depose Look in this action. (Gidding Decl. ¶ 18.) FATIC contends that while Look did sign some verifications in connection with discovery responses served early in this case, she did so only in her capacity as FATIC’s representative, and not from her personal knowledge. (Gidding Decl. ¶ 18, Exh. 17.) FATIC argues that although both Susan Vignale and Steven Derloshon have signed such verifications as well, Plaintiffs have never sought to depose them. (Gidding Decl. ¶ 19-20, Exh. 18-19.) FATIC asserts that Meredith Mayosky, the claims handler on the Romero claim, testified on October 23, 2018 that she did not work with Look at all while handling the Romero claim. (Gidding Decl., Exh. 12 (Mayosky Depo.), 17:7-23.)

FATIC contends that Plaintiffs’ request for the transcript is burdensome and oppressive, as Plaintiffs knew of it but made no reference to it and waited to seek it until after discovery closed. FATIC argues that Plaintiffs have had constructive, if not actual knowledge, of the Look deposition since the inception of this case. FATIC asserts that Plaintiffs were represented by John Hosack and Jason Goldstein, both experienced insurance bad faith attorneys with the Buchalter firm. (RJN ¶ 10, Exh. 16.) FATIC contends that Hosack and Goldstein both served as expert witnesses in the Baldaz action. (RJN ¶ 4, Exh. 4.) FATIC argues that Plaintiffs’ counsel would ostensibly have been aware of Look’s connection with the Balaz case as alleged in the Balaz complaint. (RJN ¶ 2, Exh. 2 (Balaz Complaint) ¶ 91, 150.) FATIC asserts that indeed, Plaintiffs referenced the Balaz case in their First Amended Complaint and their operative SAC. (FAC ¶ 58; SAC ¶ 118.)

FATIC contends that at this point, discovery has closed and FATIC is unable to seek any further discovery concerning whatever issues might be raised by the introduction of the Look deposition into this case, as the deposition is not admissible as “other act” evidence when offered to show a party’s disposition to commit an act or to prove the party’s conduct on a specified occasion. (Evid. Code ; 1101.) FATIC argues that given that discovery is now closed, Plaintiffs cannot seek the Look deposition in order to make their way to admissible evidence, as they cannot depose Look and cannot employ any other discovery devices to follow up on anything that might be contained therein. FATIC asserts that to put the burden on FATIC to respond to an inadmissible deposition at trial, when it was never identified in discovery, despite being known to Plaintiffs, is oppressive.

In opposition, Plaintiffs argue that the Look transcript is irrelevant to the close of discovery. Plaintiffs assert that FATIC fails to cite to any legal authority that prevents Plaintiffs from ordering a copy of a deposition transcript from whatever case they feel like. Plaintiffs assert that FATIC is not prejudiced by the disclosure of Look’s transcript. Plaintiffs contend that FATIC was a party to the Balaz and has access to all the depositions, discovery, trial transcripts, and all of the information in the Balaz action. Plaintiffs argue that FATIC cannot possibly be prejudiced when it is already in possession of all documents and information pertaining to the Balaz case.

Plaintiffs assert that moreover, FATIC has failed to establish how or why the production of the Look transcript will cause any annoyance, embarrassment, oppression, undue burden or expense to FATIC. Plaintiffs contend that FATIC makes wild and unfounded speculations about how Plaintiffs may or may not use the transcript that have no relevance to the fact that the transcript itself was not protected from disclosure and may be relevant. Plaintiffs argue that if and how Romeros plan to use the Look transcript is an entirely separate issue, and motion, from whether Romeros can get a copy of the transcript. Setting the “use” issue aside, FATIC has failed to meet their burden to show how the disclosure of the Look transcript would cause “unwarranted annoyance, embarrassment, or oppression or undue burden and expense.”

In reply, FATIC argues that there is no longer any possibility that Look’s testimony in the Balaz case could be relevant to this case, as the Balaz case alleged payment of a low DIV whereas it has now been adjudicated in the Shih/Ko action that FATIC overpaid Plaintiff by $26,000. (RJN, ¶ 9; Exh. 13 (Plaintiff’s Response to Separate Statement), Nos. 52-55.)

The Court finds that FATIC has failed to establish good cause sufficient to justify the issuance of a protective order. As noted by Plaintiffs, admissibility is the incorrect measure for whether information may be discoverable. A “claim that discovery is not warranted because the evidence disclosed would not itself be admissible is untenable. It is settled that admissibility is not prerequisite to discovery. [Citations.]” (Davies v. Superior Court (1984) 36 Cal.3d 291, 301.) Rather, “the phrase “reasonably calculated to lead to the discovery of admissible evidence” makes it clear that the scope of discovery extends to any information that reasonably might lead to other evidence that would be admissible at trial.” (Lipton v. Superior Court (1996) 48 Cal.App.4th 1599, 1612.) Accordingly, FATIC’s arguments regarding the admissibility of the Look deposition are unavailing.

Further, while FATIC argues that it would be without a way to seek any further discovery concerning whatever issues might be raised by the introduction of the Look deposition into this case, FATIC has various methods of obtaining such discovery, such as a motion to reopen discovery. Finally, the Court is unpersuaded that FATIC would be prejudiced by the disclosure of the deposition transcript to Plaintiffs, as FATIC was a party to the Balaz case, was present at the Look deposition, and is in possession of all relevant information related to that case. If FATIC is concerned about the introduction of the Look deposition itself at trial, FATIC may bring an appropriate motion in limine.

Based on the foregoing, FATIC’s motion for protective order is DENIED. The Court declines Plaintiffs’ request for sanctions against FATIC. First, the Court finds that given Plaintiffs’ request for the Look deposition nearly six months after the close of discovery, FATIC was substantially justified in bringing the instant motion. Moreover, Plaintiffs have failed to justify the amount they seek in sanctions, as Plaintiffs would only be entitled to the recovery of fees related to opposing the instant motion.

Conclusion

FATIC’s motion for protective order is DENIED.

Moving party is to give notice.

The parties are strongly encouraged to attend all scheduled hearings virtually or by audio. Effective July 20, 2020, all matters will be scheduled virtually and/or with audio through the Court’s LACourtConnect technology. The parties are strongly encouraged to use LACourtConnect for all their matters. All social distancing protocols will be observed at the Courthouse and in the courtroom.



Case Number: ****6649    Hearing Date: December 08, 2020    Dept: 31

MOTION TO MODIFY COURT ORDER IS GRANTED, IN PART.

Background

Plaintiffs Cesar Romero (“Cesar”) and Tatana Romero (“Tatana”) brought the instant action against Defendants First American Title Insurance Company (hereinafter “FATIC”), First American Title Company, and Prominent Escrow Services, Inc. for compensatory and injunctive relief based on allegations that Plaintiffs’ non-party neighbor’s home improvements encroached onto Plaintiffs’ property. Plaintiffs also claim that FATIC, who provided Plaintiffs’ title insurance, acted in bad faith by improperly favoring Plaintiffs’ neighbors, “Shih/Ko,” in the dispute over the alleged encroachment, LASC Case No. EC064933 entitled Romero, et al. v. Shih, et al. (the “underlying action” or “related action”), and failed to pay Plaintiffs adequate damages to compensate for the diminution in value of their property caused by the encroachment. In the operative Second Amended Complaint (“SAC”), Plaintiffs assert causes of action for:

  1. Breach of Contract by Escrow Agents and Fiduciaries for Failure to Comply with Instructions;

  2. Negligence by Escrow Agents and Fiduciaries in the Performance of Their Duties;

  3. Breach of Fiduciary Duty;

  4. Damages for Negligent Representation;

  5. Damages for Fraud;

  6. Breach of Insurance Contract;

  7. Breach of the Duty of Good Faith and Fair Dealing; and

  8. Unfair Business Practices.

    The sixth, seventh, and eighth causes of action are pending against FATIC because the Court sustained FATIC’s demurrer to the first, second, third, fourth, and fifth causes of action without leave to amend on May 9, 2018. Also as a result of sustaining the demurrer without leave to amend on May 9, 2019, Defendant First American Title Company was dismissed with prejudice, as the first through fifth causes of action were the only ones asserted against it. On January 31, 2019, Plaintiffs dismissed Defendant Prominent Escrow Services, Inc. with prejudice.

    On January 30, 2020, the Court granted FATIC’s for an Independent Medical Examination (“IME”) of Plaintiffs. The motion to compel indicated that “the examinations [were to] take place at the office of psychiatrist Suzanne Dupee, M.D., located at 1148 Manhattan Avenue, Suite 9, Manhattan Beach, California 90266, within 30 days of the hearing of [the] motion. Dr. Dupee is a licensed clinical psychiatrist and board certified by the American Board of Psychiatry and Neurology including a subspecialty in forensic psychiatry. The examination will take between three to four hours, excluding psychological testing, which can take an additional two to four hours. (Boswell Decl., Exh. 12.)” (January 30, 2020 Order at 3.) The Court’s January 30, 2020 Order also provided: “The examinations shall be conducted individually as to each Plaintiff, and no one else can be in the room during the examination other than the Plaintiff subject to the examination. Each examination cannot exceed more than 8 hours, excluding breaks.” (January 30, 2020 Order at 8.)

    On July 2, 2020, the Court denied Plaintiffs’ Motion for Order to Stay January 30, 2020 Order Pending the Resolution of Plaintiffs’ Related Motion for Protective Order of the Mental Examination Records and Other Medical Information sought by FATIC.

    Plaintiffs now move for an order amending the Court’s January 30, 2020 Order, allowing Plaintiffs to appear remotely for their IMEs and to allow Plaintiffs’ medical expert access to all raw data and test results upon completion of Plaintiffs’ examinations.

    Legal Standard

    Code of Civil Procedure section 128(a)(8) provides that “[e]very court shall have the power . . . to amend and control its process and orders so as to make them conform to law and justice.”

    Evidentiary Objections

    FATIC submits a number of objections to the Declaration of Richard G. Rappaport, M.D. The objections are immaterial to the Court’s disposition. The Court thus declines to rule upon them.

    Plaintiffs similarly submit objections to the Declarations of Suzanne Dupee, M.D. and Lisa Boswell.

    Declaration of Suzanne Dupee, M.D., Objection Nos. 5-7 – OVERRULED

    Declaration of Lisa Boswell, Objection Nos. 17 – OVERRULED

    The remaining objections are immaterial to the Court’s disposition. The Court thus declines to rule upon them.

    Request for Judicial Notice

The court may take judicial notice of “official acts of the legislative, executive, and judicial departments of the United States and of any state of the United States,” “[r]ecords of (1) any court of this state or (2) any court of record of the United States or of any state of the United States,” and “[f]acts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” (Evid. Code ; 452, subds. (c), (d), and (h).)

Plaintiffs request that the Court take judicial notice of the Court’s January 30, 2020 Minute Order; Emergency Rules of the California Rules of Court; and the California Constitution, Article I. The request is GRANTED.

FATIC requests that the Court take judicial notice of a number of documents filed in this action as well as the Executive Department State of California’s Proclamation of a State of Emergency dated March 4, 2020. The request is GRANTED.

Discussion

Plaintiffs move for an order amending the Court’s January 30, 2020 Order, allowing Plaintiffs to appear remotely for their IMEs and to allow Plaintiffs’ medical expert access to all raw data and test results upon completion of Plaintiffs’ examinations.

The Court notes at the outset that Plaintiffs’ reply includes requests for relief not originally requested in their moving papers, namely requests to amend the August 5, 2020 Protective Order and for sanctions. As noted in this Court’s July 2, 2020 Order, such requests on reply are inappropriate, as they deprive FATIC of an opportunity to be heard. Accordingly, the Court disregards Plaintiffs’ reply to the extent that it requests such relief.

Plaintiffs move for an order amending the Court’s January 30, 2020 Order primarily relying on Emergency Rule 11 and their inalienable right to defend life and pursue and obtain safety. Plaintiffs argue that the Emergency Rules set forth recommendations that stress the importance of remote technology and remote appearances in order to protect the health and safety of the public, litigants, witnesses, court personnel, judicial officers, and others during the pandemic. Plaintiffs assert that the IME proposed by FATIC’s psychiatrist is a deposition proceeding that will consist of a line of questioning into Plaintiffs’ feelings and emotions. Plaintiffs contend that this is not a personal injury case requiring an actual physical examination and therefore, a remote appearance is not just proper and within the law, but also absolutely necessary to safeguard the health and life of Plaintiffs and their elderly family members.

Plaintiffs argue that both Plaintiffs have elderly family members living with them who are at high-risk of death if they contract COVID-19. (Cesar Decl. ¶ 11-22; Tatiana Decl. ¶ 10-21.) Plaintiffs assert that in light of the raging pandemic, Plaintiffs have the constitutional right to defend the life of their vulnerable family members, defend their own life, and pursue their own safety and the safety of loved ones. Plaintiffs contend that they are not refusing to appear at the IME, but instead are requesting to appear remotely. Plaintiffs argue that ruling otherwise might lead to the unnecessary and tragic consequences for those who are not even a party to this lawsuit.

Plaintiffs assert that FATIC will not be prejudiced in any way if their medical expert conducts the IME via remote technologies. Plaintiffs contend that virtually all medical practices have shifted toward telemedicine using audio and video technology to conduct visits and exams. Plaintiffs argue that their medical expert has shifted his psychiatric evaluation practice exclusively to telemedicine to safeguard his own health as well as the health of his clients and the public. (Rappaport Decl. ¶ 17.) Plaintiffs assert that all components of the examinations can easily be set up via remote technologies, similar to what the State Bar will do with online bar exams and medical practitioners are doing with health exams. (Rappaport Decl. ¶ 16-17.) Plaintiffs contend that given the nature of the proposed IME, it is not possible to “cheat” or for Plaintiffs to manipulate or tamper with the examination in any way that would void or nullify Dr. Dupee’s evaluations or administration of psychological tests.

In opposition, FATIC first argues that on September 25, 2020, in an effort to reach a compromise to allow Plaintiffs’ Court ordered mental exams to move forward, FATIC proposed the following to Plaintiffs:

  1. If the State of California lifts the state of emergency due to COVID-19 in or before January 2021, then Plaintiffs’ mental exams (to be conducted separately per No. 2(a) below) will go forward in person subject to the COVID precautions FATIC previously proposed in August (i.e., Dr. Dupée will administer the exams and testing in a conference room at Premier WorkSpaces located at 1500 Rosecrans Avenue, #500, in Manhattan Beach which will permit the exams and testing to be conducted with social distancing. Dr. Dupée will wear a mask and Plaintiffs may do the same. If Plaintiffs like, Dr. Dupée will also wear gloves and will be happy to wipe down the computer and desk/table in Plaintiffs’ presence) within 30 days after said state of emergency is lifted.

  2. If the State of California does not lift the state of emergency due to COVID-19 in or before January 2021, then the exams will go forward remotely within 30 days thereafter subject to the following conditions:

    1. In accordance with the Court’s January 30, 2020 Order: “The examinations shall be conducted individually as to each Plaintiff, and no one else can be in the room during the examination other than the Plaintiff subject to the examination.”

    2. Each examination will be conducted via Zoom or similar technology.

    3. Dr. Dupée’s office will share Plaintiffs’ computer screen on which the exam is being conducted during the entirety of the exam and testing.

    4. Aside from the computer on which the testing is being conducted, no other electronics (computers, tablets such as an iPad, smart speakers such as Alexa, Echo, or Google Home, smart displays such as Facebook Portal or Google Nest, cell phones or other similar devices) will be permitted in the room in which Plaintiffs sit for the exam

  3. That Plaintiffs’ motion to amend the Court’s January 30, 2020 mental IME order currently set for hearing on December 8, 2020, either be taken off calendar or continued until March 2021 to allow the exams to go forward as contemplated under either No. 1 or 2 above.

  4. Dr. Dupée will release the raw data from Plaintiffs’ tests directly to Dr. Richard G. Rappaport within 7 business days after each exam is completed.

(Boswell Decl. ¶ 12, Exh. 9.)

FATIC asserts that Plaintiffs summarily rejected FATIC’s proposal on October 23, 2020, instead insisting on seeking the Court’s ruling on this motion. (Boswell Decl. ¶ 12, Exh. 9.)

FATIC argues that if the Court is inclined to modify its January 30, 2020 Order, it should be consistent with FATIC’s Virtual Mental IME Proposal contained in number 2 of FATIC’s proposal. FATIC asserts that the proposed virtual exam protocol is reasonable and Plaintiffs never explained why the proposal was unacceptable to them. (Boswell Decl. ¶ 12, Exh. 9.) FATIC contends that aside from promoting further delay, it is presumed that Plaintiffs rejected this proposal as they would prefer to submit to remote exams without any ground rules or constraints to ensure the legitimacy of the exams. FATIC argues that as the never-ending law and motion in this case has demonstrated, even if the parameters of this Court’s orders are expressly stated, Plaintiffs will adopt a strained interpretation of even the most reasonable and straightforward orders to avoid compliance, particularly in the case of their Court ordered mental exams. FATIC asserts that the parameters proposed by FATIC are therefore necessary to ensure that the exams and the results thereof are as meaningful as possible.

FATIC contends that Plaintiffs’ expert, Dr. Rappaport pointed out that, with available video technologies, it can be very easily determined and confirmed that no one else is present in the room, should that be a concern. (Rappoport Decl. at ¶ 18.) FATIC argues that to this point, it is essential that Dr. Dupée’s office share Plaintiffs’ computer screen on which the exam is being conducted during the entirety of the exam and testing to minimize the risks of potential third party interference, distraction, disruption, defeating the tests and thereby invalidating the evaluation and testing. (Dupée Decl. ¶¶ 9, 11-12.) FATIC asserts that the same rationale applies to the proposed restriction against any other smart electronics (such as computers, tablets such as an iPad, smart speakers such as Alexa, Echo, or Google Home, smart displays such as Facebook Portal or Google Nest, cell phones or other similar devices) in the room in which Plaintiffs sit for the exam. (Dupée Decl. ¶¶ 9, 11-12.)

FATIC contends that finally, as discussed above, FATIC’s proposal to release the raw data from Plaintiffs’ tests directly to Dr. Rappaport within 7 business days after each exam is completed is reasonable and well less than the 30-day production deadline contemplated by Civ. Proc. Code ; 2032.610(b). (Dupée Decl. ¶ 13.) FATIC argues that it will produce Dr. Dupée’s written reports in accordance with Civ. Proc. Code ; 2032.610(b).

FATIC finally asserts that the proposed parameters are necessary to minimize any undue prejudice to FATIC. FATIC contends that will be unduly prejudiced if it is forced to defend Plaintiffs’ emotional distress and damages claims at trial without the opportunity to conduct meaningful mental exams of each of the Plaintiffs. FATIC argues that its ability to obtain meaningful and valid mental exams will be severely hampered if Plaintiffs are given free rein to conduct the exams remotely without pre-set ground rules and will virtually guarantee further law and motion to secure proper exams from the Plaintiffs. FATIC contends that these parameters are reasonably tailored to the circumstances. FATIC argues that if Plaintiffs’ true and primary concern is the health and safety of themselves and their family, then these minimal concessions of sharing their computer screen and removing any other smart devices from the room should not be too much to ask to allow the examinations to be conducted in the safety of their own home.

In reply, Plaintiffs argue that FATIC’s proposed restrictions violate Code of Civil Procedure Section 2032.530, which provides that “[t]he examiner and examinee shall have the right to record a mental examination by audio technology.” Plaintiffs assert that they are allowed by law to have an audio recorder during the examination. Plaintiffs contend that moreover, there is nothing in the statute that prohibits Plaintiffs from having a cell phone as Plaintiffs have the right to know if someone is trying to get a hold of them in case of an emergency.

Plaintiffs argue that further, FATIC’s demand that Plaintiffs share their computer screen is unreasonable and a complete invasion of privacy. Plaintiffs assert that given that Zoom meetings have full video and sound, what possible reason exists to get access to Plaintiffs’ computer too? Plaintiffs contend that should the Court feel inclined that Plaintiffs’ screen and computer must be shared, then Plaintiffs insist and demand that Dr. Dupee’s computer is shared with Plaintiffs so that Plaintiffs are able to have the same access to Dr. Dupee’s computers as FATIC wants to impose on Plaintiffs.

The Court finds that good cause exists to amend the Court’s January 30, 2020 Order to make it conform to justice. The Court thus amends its January 30, 2020 Order to allow Plaintiffs to attend their Court-ordered IMEs virtually consistent with FATIC’s proposed restrictions subject to the limitations below.

The Court agrees with Plaintiffs that they are allowed, by law, to audio record the examinations as they see fit. Accordingly, Plaintiffs may have a device of their choosing to record audio as necessary. However, the device chosen must be of the kind that is solely capable of recording audio, such as a digital voice recorder or tape recorder, or a device wherein all other capabilities are disabled aside from its audio recording function. The Court finds this restriction necessary as Dr. Dupee must be able to control the environment in which the examination is conducted in order to ensure that the examinations produce accurate results.

As to the restriction of cell phones in the examination room, the Court finds that such a restriction is unnecessary. Had Plaintiffs attended their depositions in person, Plaintiffs likely would have been allowed to have their cell phones with them during the examination even if they were not able to use them. Accordingly, the Court will allow Plaintiffs to have a cell phone in the examination room but will restrict Plaintiffs’ use of the cell phone in the same manner in which Dr. Dupee would have restricted its use during an in-person examination, i.e., to be used on breaks, if allowed, or otherwise.

To that end, the Court finds that the proposed restrictions with regard to other electronics and smart devices in the examination room is necessary to the completion of an accurate and effective examination, as Plaintiffs would not have had access to such devices had an in-person examination taken place.

Finally, the Court finds that it is necessary for Dr. Dupee to share the screen Plaintiffs are viewing during their examinations to, again, ensure that the environment is controlled and the examinations produce accurate results. While Plaintiffs argue that this would be an invasion of privacy, Plaintiffs at the same time argue that they be allowed to attend their examinations remotely as would California Bar Examinees would be allowed to attend the California Bar Exam. Plaintiffs’ argument is thus flawed, as California Bar Examinees are required to share their screens with test proctors during their examinations to ensure that their examinations are free from third party interference, distraction, or disruption. Moreover, Plaintiffs will not be required to give Dr. Dupee control or access to their computer’s files or capabilities, but will only be required to share the screen that Plaintiffs are looking at during the examinations. Had Plaintiffs gone in for in-person examinations, Dr. Dupee would have been able to control what Plaintiffs viewed on the computer screen.

Based on the foregoing, Plaintiffs’ motion to amend the January 30, 2020 Order is GRANTED, in part, as more fully detailed above.

The Court orders that:

  1. The exams will go forward remotely within 30 days subject to the following conditions:

    1. In accordance with the Court’s January 30, 2020 Order: “The examinations shall be conducted individually as to each Plaintiff, and no one else can be in the room during the examination other than the Plaintiff subject to the examination.”

    2. Each examination will be conducted via Zoom or similar technology as determined by Dr. Dupee.

    3. Dr. Dupée’s office will share Plaintiffs’ computer screen on which the exam is being conducted during the entirety of the exam and testing.

    4. Aside from the computer on which the testing is being conducted, no other electronics (computers, tablets such as an iPad, smart speakers such as Alexa, Echo, or Google Home, smart displays such as Facebook Portal or Google Nest, or other similar devices) aside from Plaintiffs’ cell phone and an audio recording device of Plaintiffs’ choosing will be permitted in the room in which Plaintiffs sit for the exam.

  2. Dr. Dupée will release the raw data from Plaintiffs’ tests directly to Dr. Richard G. Rappaport within 7 business days after each exam is completed.

    Conclusion

    Plaintiffs’ motion to amend the January 30, 2020 Order is GRANTED, in part, as more fully detailed in this Order.

    Moving parties to give notice.

The parties are strongly encouraged to attend all scheduled hearings virtually or by audio. Effective July 20, 2020, all matters will be scheduled virtually and/or with audio through the Court’s LACourtConnect technology. The parties are strongly encouraged to use LACourtConnect for all their matters. All social distancing protocols will be observed at the Courthouse and in the courtroom.



Case Number: ****6649    Hearing Date: October 23, 2020    Dept: 31

PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT IS DENIED.

Background

Plaintiffs Cesar Romero (“Cesar”) and Tatana Romero (“Tatana”) brought the instant action against Defendants First American Title Insurance Company (hereinafter “FATIC”), First American Title Company, and Prominent Escrow Services, Inc. for compensatory and injunctive relief based on allegations that Plaintiffs’ non-party neighbor’s home improvements encroached onto Plaintiffs’ property. Plaintiffs also claim that FATIC, who provided Plaintiffs’ title insurance, acted in bad faith by improperly favoring Plaintiffs’ neighbors, “Shih/Ko,” in the dispute over the alleged encroachment, LASC Case No. EC064933 entitled Romero, et al. v. Shih, et al. (the “underlying action” or “related action”), and failed to pay Plaintiffs adequate damages to compensate for the diminution in value of their property caused by the encroachment. In the operative Second Amended Complaint (“SAC”), Plaintiffs assert causes of action for:

  1. Breach of Contract by Escrow Agents and Fiduciaries for Failure to Comply with Instructions;

  2. Negligence by Escrow Agents and Fiduciaries in the Performance of Their Duties;

  3. Breach of Fiduciary Duty;

  4. Damages for Negligent Representation;

  5. Damages for Fraud;

  6. Breach of Insurance Contract;

  7. Breach of the Duty of Good Faith and Fair Dealing; and

  8. Unfair Business Practices.

    The sixth, seventh, and eighth causes of action are pending against FATIC because the Court sustained FATIC’s demurrer to the first, second, third, fourth, and fifth causes of action without leave to amend on May 9, 2018. Also, as a result of sustaining the demurrer without leave to amend on May 9, 2019, Defendant First American Title Company was dismissed with prejudice, as the first through fifth causes of action were the only ones asserted against it. On January 31, 2019, Plaintiffs dismissed Defendant Prominent Escrow Services, Inc. with prejudice.

    Plaintiffs now move for summary adjudication on the following issue of duty: FATIC owes Plaintiffs a continuing duty to defend until the final resolution of the underlying action.

    Legal Standard 

“A party may move for summary adjudication as to one or more causes of action within an action, one or more affirmative defenses, one or more claims for damages, or one or more issues of duty, if that party contends that the cause of action has no merit or that there is no affirmative defense thereto, or that there is no merit to an affirmative defense as to any cause of action, or both, or that there is no merit to a claim for damages . . . or that one or more defendants either owed or did not owe a duty to the plaintiff or plaintiffs. A motion for summary adjudication shall be granted only if it completely disposes of a cause of action, an affirmative defense, a claim for damages, or an issue of duty.” (Code of Civ. Proc., ; 437c, subd. (f)(1).) A motion for summary adjudication shall proceed in all procedural respects as a motion for summary judgment. (Code of Civ. Proc., ; 437c, subd. (f)(2).)

“[T]he initial burden is always on the moving party to make a prima facia showing that there are no triable issues of material fact.” (Scalf v. D. B. Log Homes, Inc. (2005) 128 Cal.App.4th 1510, 1519.) When a Plaintiff or Cross-Complainant seeks summary judgment, he/she must produce admissible evidence on each element of each cause of action on which judgment is sought. (CCP ; 437c(p)(1).) The Plaintiff/Cross-Complainant is not required to disprove any affirmative defenses to discharge this burden. (Weil & Brown, Civ.Pro.Before Trial, Chap. 10--Summary Judgment, 10:235.) The opposing party on a motion for summary judgment is under no evidentiary burden to produce rebuttal evidence until the moving party meets his or her initial movant’s burden. (Binder v. Aetna Life Insurance Company (1999) 75 Cal.App.4th 832.) Once the initial movant’s burden is met, then the burden shifts to the opposing party to show, with admissible evidence, that there is a triable issue requiring the weighing procedures of trial. (CCP ; 437c(p).)

“When deciding whether to grant summary judgment, the court must consider all of the evidence set forth in the papers (except evidence to which the court has sustained an objection), as well as all reasonable inferences that may be drawn from that evidence, in the light most favorable to the party opposing summary judgment.” (Avivi v. Centro Medico Urgente Medical Center (2008) 159 Cal. App. 4th 463, 467; CCP ;437c(c).)

Request for Judicial Notice

The court may take judicial notice of “official acts of the legislative, executive, and judicial departments of the United States and of any state of the United States,” “[r]ecords of (1) any court of this state or (2) any court of record of the United States or of any state of the United States,” and “[f]acts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” (Evid. Code ; 452, subds. (c), (d), and (h).)  

Plaintiffs request that the Court take judicial notice of a number of documents filed in this case and the underlying action, LASC Case no. EC064833. The request is GRANTED.

FATIC similarly requests that the Court take judicial notice of a number of documents filed in this case and the underlying action in addition to the fact that Jeffrey J. Ludlow is a licensed real estate broker in good standing. The request is GRANTED.

Evidentiary Objections

FATIC submits a number of objections to the Declarations of Cesar Romero, Charles Hansen, and Arthur E. Gimmy.

The objections are immaterial to the Court’s disposition of the motion. The Court therefore declines to rule upon them.

Likewise, Plaintiffs submit a number of objections to the Declarations of Kenneth E. Dzien, and Zachary Gidding.

Objection nos. 29, 36, 39-41 – OVERRULED.

The remaining objections are immaterial to the Court’s disposition of the motion. The Court therefore declines to rule upon them.

All objections not ruled upon are preserved for appeal. (Code Civ. Proc. ; 437c(q).)

Discussion

Plaintiffs move for summary adjudication on the following issue of duty: FATIC owes Plaintiffs a continuing duty to defend until the final resolution of the underlying action.

The EAGLE Homeowner’s Policy of Title Insurance & Underlying Dispute

Title to the property located at 651 W. Algeria Ave., Sierra Madre, CA 91024 was conveyed to the Romeros on April 9, 2014, which included the disputed land. (Undisputed Material Fact (“UMF”) 1.) In connection with the purchase of the Romero Property, FATIC issued an EAGLE Homeowner’s Policy of Title Insurance, policy number 5020500-839405c, effective April 9, 2014 (the “Policy”). (UMF 6.) The Policy provides, in relevant part:

OWNER’S COVERAGE STATEMENT

This Policy insures You against actual loss, including any costs, attorneys’ fees and expenses provided under this Policy. The loss must result from one or more of the Covered Risks set forth below. This Policy covers only Land that is an improved residential lot on which there is located a one-to-four family residence and only when each insured named in Schedule A is a Natural Person. Your insurance is effective on the Policy Date. This Policy covers Your actual loss from any risk described under Covered Risks if the event creating the risk exists on the Policy Date or, to the extent expressly stated in Covered Risks, after the Policy Date. . . .

OUR DUTY TO DEFEND AGAINST LEGAL ACTIONS

We will defend Your Title in any legal action only as to that part of the action which is based on a Covered Risk and which is not excepted or excluded from coverage in this Policy. We will pay the costs, attorneys’ fees, and expenses We incur in that defense. We will not pay for any part of the legal action which is not based on a Covered Risk or which is excepted or excluded from coverage in this Policy. We can end Our duty to defend Your Title under section 4 of the Conditions. . . .

CONDITIONS . . .

3. HOW TO MAKE A CLAIM

a. Prompt Notice of Your Claim

(1) As soon as You Know of anything that might be covered in this Policy, You must notify Us promptly in writing. . . .

b. Proof of Your Loss

(1) We may require You to give Us a written statement signed by You describing Your loss which includes:

(a) the basis of Your claim;

(b) the Covered Risks which resulted in Your loss;

(c) the dollar amount of Your loss; and

(d) the method You used to compute Your loss.

(2) We may require You to make available to Us records, checks, letters, contracts, insurance policies and other papers which relate to Your claim. We may make copies of these papers.

(3) We may require You to answer questions about Your claim under oath.

(4) If you fail or refuse to give Us a statement of loss, answer Our questions under oath, or make available to Us the papers We request, Your coverage will be reduced or ended, but only to the extent Your failure or refusal affects Our ability to resolve the claim or defend You.

4. OUR CHOICES WHEN WE LEARN OF A CLAIM

a. After We receive Your notice, or otherwise learn, of a claim that is covered by this Policy, Our choices include one or more of the following:

(1) Pay the claim;

(2) Negotiate a settlement;

(3) Bring or defend a legal action related to the claim;

(4) Pay You the amount required by this Policy;

(5) End the coverage of this Policy for the claim by paying You Your actual loss resulting from the Covered Risk, and those costs, attorneys’ fees and expenses incurred up to that time which We are obligated to pay . . .

b. When We choose the option in Sections 4.a. (5), . . . all Our obligations for the claim end, including Our obligation to defend, or continue to defend, any legal action.

(UMF 8-10, 12; Romero Decl., Exh. C.)

On or about June 2015, a Record of Survey of the Romero Property disclosed an encroachment area over the Romero Property measuring approximately 1,296 square feet. (UMF 14.) Title to the property located at 643 W. Alegria Ave., Sierra Madre, CA 91024 was conveyed to Shih/Ko on July 1, 2014. (UMF 25.) FATIC issued to Shih/Ko a Homeowner’s Policy of Title Insurance, policy number 5020500-0176956E, effective July 1, 2014. (UMF 28.)

On or about February 10, 2016, the Romeros filed a complaint against Shih/Ko for quiet title, trespass, and declaratory relief. (UMF 43.) On or about May 5, 2016, Shih-Ko filed a Cross-Complaint (“Shih/Ko Cross-Complaint”) against the Romeros for quiet title, equitable easement, implied easement, and declaratory relief. (UMF 47.) The Shih/Ko Cross-Complaint includes a prayer for, among other things, judgment awarding Cross-Complainants their out-of-pocket expenses and other administrative, investigative, and ancillary expenses incurred, costs of suit incurred, and such other and further relief as the court may deem just and proper. (UMF 48.) On or about November 7, 2016, Plaintiffs’ former attorney Lisa Weinberg submitted a tender of defense letter to FATIC under the Romeros’ Policy (“Romeros’ Claim”). (UMF 49.)

On December 9, 2016, FATIC sent a letter to the Romeros stating, in pertinent part:

First American Title Insurance Company (“First American”) has completed its investigation of a claim you submitted on behalf of Cesar Romero and Tatan Spicakova Romero (“Insureds”) regarding a tender of defense of a cross-complaint for among other things, Equitable Easement and Implied Easement, filed in the above-referenced action (“Action”). As discussed below, First American will be paying loss under the above-reference policy (“Policy”) based on a diminution in value due to the prescriptive rights the Cross-Complainant is claiming in the above-referenced property (“Property”). . . .

The Policy insures, subject to the Exclusions, the Exception in Schedule B and the Conditions, against loss or damage, sustained or incurred by the insured by reason of:

  1. Someone else owns an interest in Your Title; . . .

  1. Someone else has an Easement on the Land; and

  2. Someone else has a right to limit Your use of the Land. . . .

Under Paragraph 4 of the Conditions of the Policy, First America has a number of options to resolve the claim. At this time, First American is electing to pay the Insureds their loss under the Policy due to the prescriptive rights asserted by the Cross-Complainants.

Actual loss relating to a covered risk that is not excluded from coverage by the policy’s terms can be measured by determining the difference in value between the property with and without the interest. The loss is measured as of the date of discovery of the interest in accordance with the actual use of the property. In the case of Overholtzer v. Northern Counties Ins. Co. (1953) 116 C.A.2d 113, 130, the Court of Appeal stated:

It seems quite apparent to us that liability [of the title insurer] should be measured by diminution in the value of the property caused by the defect in title as of the date of the discovery of the defect, measured by the use to which the property is then being devoted.

Accordingly, First American has retained an appraiser to perform this valuation. The appraiser retained is Otis E. Hackett. . . .

As we understand, the date of discovery of the Cross-Complainants claim of an easement was on May 4, 2016.

In connection with the Cross-Complaint, please be advised that First American hereby agrees to provide a defense as to the Cross-Complaint until the foregoing appraisal is completed. First American is agreeing to reimburse your firm to defend the Insureds as to the Cross-Complaint only until the foregoing appraisal is completed. . . .

Once the appraisal is complete completed and payment of the diminution in value has been made, we will be withdrawing our defense. Pursuant to Condition 4 of the Policy, once First American has paid the Insured its loss, all Our obligations for the claim end, including Our obligation to defend, or continue to defend any legal action.

(UMF 53-54, 57; Additional Material Fact (“AMF”) 33; Romero Decl., Exh. BB.)

FATIC hired Otis Hackett to prepare his opinion about the diminution in value (“DIV”) (the “Hackett Appraisal”). (UMF 58.) On or about February 3, 2017, FATIC provided the Romeros with a copy of the Hackett Appraisal and an accompanying letter. (UMF 64.) The letter provided, in pertinent part:

Mr. Hackett’s appraisal report concludes that the diminution in value to the Property resulting from the subject easement is $95,000.

Accordingly, First American Title Insurance Company (“First American”) is electing to pay Cesar Romero and Tatana Spicakova Romero’s (“Insureds”) loss in the amount of $95,000 based on the diminution in value determined by the appraiser.

Enclosed is First American’s check in the amount of $95,000. Please note that by the Insureds accepting the $95,000 payment they do not waive their rights to provide additional proof to First American that their loss is greater. The Insureds can submit their own appraisal for First American’s review within the next thirty (30) days. Please let us know if you need additional time.

With regard to the pending action, please be advised that First American no longer has an obligation to defend the Insureds. Pursuant to my December 9, 2016 letter, First American agreed to provide a defense of the Cross-Complaint up and until the appraisal was completed and the payment of loss was made to the Insureds. Accordingly, First American no longer has an obligation to defend the Insureds.

(UMF 65-67; Romero Decl., Exh. DD.)

That same day, February 3, 2017, FATIC tendered a check to the Romeros for $95,000. (AMF 38.) The Romeros accepted and cashed the $95,000 check. (AMF 40.)

On March 23, 2017, the Romeros informed FATIC that they believed the DIV to be greater than $95,000.00 and would be providing a report showing the property value. (AMF 43.) The Romeros provided FATIC with an appraisal from Brenda Wendt Consulting which provided that the DIV of the Property from the Encroachment was $119,000.00, which was $24,000.00 more than the appraisal by Otis B. Hackett. (AMF 44.)

In the underlying action, the Court issued a Statement of Decision, dated September 28, 2020, following a bench trial. (AMF 47.) The Court found that the best measure of damage to the Romeros due to the creation of an equitable easement was the diminution in value to the property. (FATIC’s RJN, Exh. F, p. 11-12.) The Court concluded that $69,000 would constitute just compensation to the Romeros for the creation of an equitable easement. (FATIC’s RJN, Exh. F, p. 12.) By March 23, 2017, FATIC had paid the Romeros $54,775.90 for the defense of the underlying action. (AMF 45.)

Plaintiffs set forth a number of arguments as to why summary adjudication should be granted in their favor on the issue of whether FATIC owed them a duty to defend until final judgment in the Shih/Ko case. The Court categorizes their arguments into three subsets: ,(1) arguments regarding whether or not the term “actual loss” in Section 4.a(5) is ambiguous; (2) arguments regarding whether or not Section 4.a(5) is enforceable; and (3) whether the payment of “actual loss” ended FATIC’s duty to defend. The Court evaluates each subset of arguments in turn.

Title Insurance & the Duty to Defend

“‘Title insurance is a contract to indemnify against loss through defects in the title or against liens or encumbrances that may affect the title at the time when the policy is issued.’ [Citation.] Changes in the condition of title after the insurer issues the policy are outside the scope of coverage. [Citation.] “Title insurance, as opposed to other types of insurance, does not insure against future events. It is not forward looking. It insures against losses resulting from differences between the actual title and the record title as of the date title is insured. The policy does not guarantee the state of the title.” [Citation.] Instead, title insurance protects against the possibility that liens or other encumbrances exist, even though they were missed in the title search or the preliminary title report. [Citation.] A title insurer issues its policies on the basis of, and in reliance on, its own investigation into recorded instruments, which should impart constructive notice. [Citation.] The records on which a title insurer relies are generally public records concerning the status of title. [Citation.] To a large extent, therefore, the title insurer is able to control the degree of risk it undertakes in issuing a policy by performing its own investigation beforehand. [Citation.] But “[t]he records pertaining to real property are complex and encumbrances may be missed by even the most thorough search. Title insurance is an acknowledgement that errors may have been made.” [Citation.]” (Liberty National Enterprises, L.P. v. Chicago Title Ins. Co. (2013) 217 Cal.App.4th 62, 75.)

“Well-established precepts of insurance coverage guide us in determining whether a policy requires a title insurer to defend a lawsuit filed by a third party against the insured. “It has long been a fundamental rule of law that an insurer has a duty to defend an insured if it becomes aware of, or if the third party lawsuit pleads, facts giving rise to the potential for coverage under the insuring agreement. [Citations.] This duty, which applies even to claims that are ‘groundless, false, or fraudulent,’ is separate from and broader than the insurer's duty to indemnify. [Citation.] However, ‘“where there is no possibility of coverage, there is no duty to defend....”’ [Citation.] [T]he determination whether the insurer owes a duty to defend usually is made in the first instance by comparing the allegations of the complaint with the terms of the policy.” [Citation.] Facts both expressed and implied in the complaint will determine whether the duty to defend arises. [Citation.] Facts extrinsic to the complaint give rise to a duty to defend when they reveal a potential for coverage, though conversely, when extrinsic facts eliminate that potential, an insurer may decline to defend. [Citation.] The duty to defend applies even to noncovered claims so long as any of the claims asserted in the complaint discloses the potential for liability covered by the policy. [Citation.] We resolve any doubt as to whether the facts or allegations establish a duty to defend in the insured's favor. [Citation.]” (Id. at 76.)

‘[T]he insurer's duty to defend runs to claims that are ... potentially covered, in light of facts alleged or otherwise disclosed. [Citations.]’ [Citation.] This duty, having arisen, “is discharged when the action is concluded. [Citation.] It may be extinguished earlier, if it is shown that no claim can in fact be covered. [Citation.] If it is so extinguished, however, it is extinguished only prospectively and not retroactively: before, the insurer had a duty to defend; after, it does not have a duty to defend further. [Citations.]” [Citation.]

Thus, the insurer's duty to defend arises whenever the third party complaint and/or the available extrinsic facts suggest, under applicable law, the possibility of covered claims. In such circumstances, if the insured tenders defense of the third party action, the insurer must assume it. The duty to defend then continues until the third party litigation ends, unless the insurer sooner proves, by facts subsequently developed, that the potential for coverage which previously appeared cannot possibly materialize, or no longer exists. The insurer must absorb all costs it expended on behalf of its insured while the duty to defend was in effect—i.e., before the insurer established that the duty had ended. [Ctiations.]

(Scottsdale Ins. Co. v. MV Transportation (2005) 36 Cal.4th 643, 657.)

“The interpretation of an insurance policy presents a question of law . . . The clear and explicit meaning of the policy provisions, interpreted in their ordinary and popular sense, unless used by the parties in a technical sense or given a special meaning by usage, controls judicial interpretation. [Citation.] We will consider a policy provision ambiguous when it is capable of two or more constructions, both of which are reasonable. [Citation.] Although an ambiguity in an insurance contract will be resolved adversely to the insurer, some actual or apparent ambiguity must be present before this rule comes into play. [Citation.] We are not free to “impose coverage by adopting a strained or absurd interpretation in order to create an ambiguity where none exists.” [Citation.]” (Liberty National Enterprises, L.P., supra, 217 Cal.App.4th at 77.)

“Unless the interpretation of the instrument turns upon the credibility of conflicting extrinsic evidence, a reviewing court makes an independent determination of the policy's meaning. [Citation.] . . . [T]he meaning of the policy is a question of law about which expert opinion testimony is inappropriate. [Citations.]” (Cooper Companies v. Transcontinental Ins. Co. (1995) 31 Cal.App.4th 1094, 1100.)

Condition 4.a(5) & Definition of “Actual Loss”

Condition 4.a of the Policy provides, in relevant part:

4. OUR CHOICES WHEN WE LEARN OF A CLAIM

a. After We receive Your notice, or otherwise learn, of a claim that is covered by this Policy, Our choices include one or more of the following:

(1) Pay the claim;

(2) Negotiate a settlement;

(3) Bring or defend a legal action related to the claim;

(4) Pay You the amount required by this Policy;

(5) End the coverage of this Policy for the claim by paying You Your actual loss resulting from the Covered Risk, and those costs, attorneys’ fees and expenses incurred up to that time which We are obligated to pay . . .

b. When We choose the option is Sections 4.a. (5), . . . all Our obligations for the claim end, including Our obligation to defend, or continue to defend, any legal action.

(UMF 10; Romero Decl., Exh. C.)

Plaintiffs argue that FATIC had a duty to defend Plaintiffs until final judgment in the Shih/Ko case. Plaintiffs assert that use of any other rule fixing the duty to defend would transform the duty into nothing more than a promise to reimburse an insured for attorney’s fees incurred. Citing to Hartford Accident & Indemnity Co. v. Superior Court ((1994) 23 Cal.App.4th 1774, 1781), Plaintiffs contend that FATIC must defend until it obtains a declaratory judgment or summary judgment that it no longer has a duty to defend.

Plaintiffs argue that, moreover, FATIC cannot use Condition 4.a(5) to terminate its duty to defend. Plaintiffs’ argument is based on the premise that Condition 4.a(5) is vague, ambiguous, and unclear, as the policy does not define “actual loss” or a method for calculating it.

Plaintiffs present the following evidence in support: there is no provision in the Policy that defines the terms “loss” and/or “actual/loss.” (UMF 11.) The Policy also does not define a method for calculating “actual loss,” and does not describe that the calculation is based on Overholtzer v. Northern California Ins. Co. (UMF 56.) The “Owner’s Coverage Statement” does provide that costs, attorney’s fees, and expenses are included in the calculation of actual loss. (UMF 8.) The Policy also asks the insureds to provide the amount and method for calculating their loss. (UMF 12.) FATIC stated that “by the Insureds accepting the [Hackett Appraisal] payment they do not waive their right to provide additional proof to First American that their loss is greater” (UMF 67) and “whether FATIC paid the correct diminution in value . . . will be decided by competing expert testimony (UMF 92.)

Plaintiffs assert that based on the foregoing, the term “actual loss” is ambiguous. Plaintiffs contend that FATIC’s interpretation of the “actual loss” means a diminution in value opinion made by FATIC’s own expert that assumed an easement and conforms to Overholtzer, none of which is described in the Policy. Plaintiffs present evidence that Plaintiffs’ own appraiser testified that the Hackett Appraisal was full of errors and unsupportable assumptions that grossly undervalued the hypothetical DIV. (UMF 77.) Plaintiffs argue that “actual loss” must be interpreted according to its plain meaning, not FATIC’s experts. Plaintiffs assert that the plain meaning of “actual loss” is the final and definite detriment, expense, cost, or damage to the Romeros resulting from Shih/Ko’s claim to the Romeros’ title. Plaintiffs present evidence that FATIC stated that “potential damage has already been paid by FATIC . . . FATIC paid Plaintiffs based on the assumption that Shih/Ko easement does in fact encumber Plaintiffs’ property.” (UMF 91.) Plaintiffs argue that this is a concession by FATIC that it did not pay “actual loss,” but rather paid “potential loss” based on an assumption, violating its own policy.

Plaintiffs also contend that other types of loss are recoverable under a title insurer’s breach, and DIV is not the only means of drawing a causal connection between damages and title defect. (Nebo, Inc. v. Transamerica Title Ins. Co. (1971) 21 Cal.App.3d 222, 227.) Plaintiffs present evidence that the Policy itself provides coverage for other types of losses under Section 6.c(2). (UMF 83.)

Plaintiffs argue that FATIC cannot invoke Condition 4.a(5) to terminate Romeros’ defense because no “actual loss” will be sustained until the final judgment of the Shih/Ko case determines what the Romeros’ losses actually are. Plaintiffs assert that FATIC’s payment did not exonerate FATIC’s continued duty to defend because it did not eliminate Plaintiffs’ risk, as it was not a payment of “actual loss” because it is not the amount determined upon final resolution of the Shih/Ko case. Plaintiffs contend that pursuant to case law, any doubt about FATIC’s duty to defend is resolved in favor of Plaintiffs, the insureds.

In opposition, FATIC argues that Plaintiffs’ contention that FATIC purportedly owes a continuing duty to defend until final resolution of the Shih/Ko action is undermined by the express terms of the Policy. FATIC asserts that in this regard, the Policy clearly provides that FATIC has multiple choices after it receives notice of a covered claim, including “[e]nd[ing] the coverage of this Policy for the claim by paying You Your actual loss resulting from the Covered Risk, and those costs, attorneys’ fees and expenses incurred up to that time which We are obligated to pay.” (UMF 10.)

FATIC argues that Plaintiffs’ contention that FATIC owes a continuing duty to defend, even after receiving and accepting payment for this actual loss and, therefore, ending coverage of their policy, would render the foregoing option entirely meaningless. FATIC argues that there would be no difference between the option FATIC exercised versus the option of defending the claim outright and paying the actual loss if the Insured lost in the litigation. FATIC contends that as a matter of law, the Romeros’ interpretation cannot be the proper interpretation of the Policy as it would render meaningless the option that FATIC exercised. (Grayl CPB, LLC v. Kolokotronis (2011) 202 Cal.App.4th 480, 490.) FATIC argues that under Plaintiffs’ interpretation of the Policy, FATIC would never have the option to end coverage and would always have a continuing duty to defend regardless of the circumstances; all the insured would need to do is disagree with the insurer’s loss calculation to keep the insurer’s defense obligations going without any penalty to the insured. FATIC asserts that the Policy does not give the insured that power. FATIC contends that rather, it is the insurer that contracted for the right to end its defense obligations and the Romeros’ attempt to eliminate that right should be rejected outright as an unreasonable interpretation.

FATIC argues that Plaintiffs’ selective interpretation of the Policy would also impermissibly lead to an absurd result. (Roden v. AmerisourceBergen Corp. (2010) 186 Cal.App.4th 620, 651.) FATIC asserts that the Policy clearly provides FATIC with choice after it receives notice of a covered claim, including “[e]nd[ing] the coverage of this Policy for the claim by paying You Your actual loss resulting from the Covered Risk, and those costs, attorneys’ fees and expenses incurred up to that time which We are obligated to pay.” (UMF 10.) FATIC contends that if Plaintiffs’ interpretation were accepted, the insurer would never be able to exercise the foregoing option. FATIC asserts that as previously noted, all an insured would need to do is claim that their actual loss was a penny more than what was paid and the insurer would still be on the hook to defend. FATIC contends that, moreover, under the Romeros’ interpretation, an insurer could pay its insured ten times what their actual loss is and still be on the hook to defend if the insured so desired. FATIC argues that additionally, if the insured were to prevail at trial, the insured would get to keep the monies it received for an actual loss that it did not end up suffering and still receive the benefit of a full defense. FATIC asserts that this is precisely the point of the provision: the insurer can elect to pay its insured its actual loss before it is even determined that the insured suffered a loss or that loss has been fixed. FATIC contends that by exercising this option, the insurer runs the risk of paying a loss it did not need to pay or overpaying the amount of the loss, which is exactly what happened here, as FATIC paid $95,000 when the loss was found by the trial judge to be only $69,000.

FATIC argues that Plaintiffs agreed to this provision, which expressly allows FATIC the right to withdraw from the defense of an insured on payment of the amount of the diminution in value. FATIC asserts that this bargained for provision serves a specific purpose and allows the title insurer the option of paying the insured the amount of the DIV in lieu of unnecessarily litigating the dispute and encourages early settlement of covered claims.

FATIC contends that the duty to defend “continues until the insurer proves otherwise,” which is exactly what occurred here. (Hartford Accident & Indem. Co. v. Superior Court (1994) 23 Cal.App.4th 1774, 1781.)

FATIC presents the following evidence: Upon receiving tender of a claim from the Romeros, FATIC informed the Romeros that pursuant to Section 4 of the Policy, it was electing to pay the amount of the Romeros’ loss under the Policy, by appraising the value of the Property subject to Shih/Ko’s claimed easement and subtracting the amount from the value of the Property without the claimed easement, i.e., the DIV. (UMF 54.) FATIC further informed Plaintiffs that it would provide a defense to the Shih/Ko Cross-Complaint by paying the fees for that defense only until the appraisal was completed. (UMF 57.) FATIC further informed the Romeros that once FATIC had paid the Romeros their loss, FATIC’s obligations under the Policy would end. (AMF 33.) The Romeros cashed the $95,000 check issued by FATIC. (AMF 40.)

FATIC argues that the cases wherein the duty to defend is resolved in favor of the insureds do not apply here, as there is no doubt regarding FATIC’s duty to defend given FATIC accepted the claim and provided the Romeros with a defense in the Shih/Ko action until FATIC paid the Romeros for their loss (UMF 57; AMF 38, 45), which terminated FATIC’s obligations under the Policy.

FATIC asserts that moreover, Section 4 of the policy is not vague, ambiguous, or unclear, as it is well established under California law that the “actual loss” is properly measured by the DIV of the property caused by the defect in title, which is exactly what FATIC calculated here. FATIC contends that the decision in Overholtzer v. Northern Counties Title Ins. Co. made this clear over 60 years ago:

It seems quite apparent to us that liability [for failure of a title insurance policy to disclose a defect in the insured’s title] should be measured by diminution in the value of the property caused by the defect in title as of the date of the discovery of the defect, measured by the use to which the property is then being devoted. When a purchaser buys property and buys title insurance, he is buying protection against defects in title to the property. He is trying to protect himself then and for the future against loss if the title is defective. The policy necessarily looks to the future. It speaks of the future. The present policy is against loss the insured “shall sustain” by reason of a defect in title. The insured, when he purchases the policy, does not then know that the title is defective. But later, after he has improved the property, he discovers the defect. Obviously, up to the face amount of the policy, he should be reimbursed for the loss he suffered in reliance on the policy, and that includes the diminution in value of the property as it then exists, in this case with improvements. Any other rule would not give the insured the protection for which he bargained and for which he paid.

(Overholtzer v. Northern Counties Title Ins. Co. (1953) 116 Cal.App.2d 113, 130.) FATIC argues that, accordingly, contrary to Plaintiffs’ contention, the term “actual loss” is not ambiguous.

FATIC asserts that Plaintiffs’ contention that Section 4.a(5) is ambiguous because the term “actual loss resulting from a covered risk” is not defined in the policy is contrary to case law. FATIC contends that the fact that a term is not specifically defined in an insurance policy does not make it unclear. (First Am. Title Ins. Co. v XWarehouse Lending Corp. (2009) 177 Cal.App.4th 106, 114.) FATIC argues that the term “actual loss” is a phrase that is defined by industry practice and does not merit further definition.

The Court finds that Plaintiffs have failed to carry their burden establishing that there are no triable issues of material fact and that they are entitled to judgment as a matter of law as to the issue of whether the term “actual loss” in Section 4.a(5) is ambiguous. Contrary to Plaintiffs arguments otherwise, the term “actual loss” is not reasonably susceptible to the construction Plaintiffs advocate, and is therefore, not ambiguous.

The plain terms of the Policy indicate a number of choices FATIC has once it learns of a claim, including option a.(3), bringing or defending a legal action related to the claim, and option a.(5), ending coverage by paying the “actual loss resulting from the Covered Risk, and those costs, attorneys’ fees and expenses incurred up to that time which [it is] obligated to pay.” (UMF 10; Romero Decl., Exh. C.) Although Plaintiffs argue that the term “actual loss” must mean the final and definite detriment, expense, cost, or damage to the Romeros resulting from Shih/Ko’s claim to the Romeros’ title, a loss that can only be determined after final judgment of the underlying action, such an interpretation would render option a.(5) meaningless, as it would require FATIC to continue paying the costs, attorneys’ fees, and expenses incurred in defense of the Shih/Ko Cross-Complaint until the end of that litigation. Additionally, option a.(5) states that FATIC may end coverage by paying the “actual loss resulting from the Covered Risk, and those costs, attorneys’ fees and expenses incurred up to that time which [it is] obligated to pay.” (UMF 10; Romero Decl., Exh. C (emphasis added).) If the term “actual loss” included “costs, attorneys’ fees, and expenses,” the inclusion of that clause would be superfluous.

While Plaintiffs argue that “actual loss” can be measured by means other than DIV, Plaintiffs have failed to point to any authority indicating that the measure they advocate, that is, the final and definite detriment, expense, cost, or damage to the Romeros, is the appropriate measure for “actual loss.” Although Plaintiffs cite to case law that indicates lost rents may be an appropriate measure for “actual loss,” Plaintiffs have failed to demonstrate that such a measure is appropriate here. “[L]anguage in a contract must be interpreted as a whole, and in the circumstances of the case, and cannot be found to be ambiguous in the abstract. [Citation.]” (Waller v. Truck Ins. Exchange, Inc. (1995) 11 Cal.4th 1, 18.)

In the absence of authority indicating that the final and definite detriment, expense, cost, or damage to Plaintiffs is the appropriate measure for “actual loss,” the Court is not persuaded that the term “actual loss” is reasonably susceptible to the definition advanced by Plaintiffs. Accordingly, the Court finds that the term “actual loss” is not ambiguous, as Overholtzer holds “that liability [for failure of a title insurance policy to disclose a defect in the insured’s title] should be measured by diminution in the value of the property caused by the defect in title as of the date of the discovery of the defect, measured by the use to which the property is then being devoted.” (Overholtzer, supra, 116 Cal.App.2d at 130.)

Plaintiffs’ citation to Hartford Accident Indemnity Co. v. Superior Court ((1994) 23 Cal.App.4th 1774, 1781) to argue that FATIC was required to obtain a declaratory judgment or summary judgment before it could terminate its defense is of no help to them, as Hartford specifically stated that the duty to defend “continues until the insurer proves otherwise,” which FATIC has done here. It is undisputed that pursuant to its exercise of Section 4.a(5), FATIC paid Plaintiffs $95,000 for the claim, which is what its appraiser calculated as the DIV from the encroachment on Plaintiffs’ property. (UMF 65; AMF 38; Romero Decl., Exh. DD.) Plaintiffs’ dispute as to whether that was the appropriate value of the DIV does not render the term “actual loss” or the method by which “actual loss” is measured ambiguous.

Further, the undisputed evidence before the Court establishes that on March 23, 2017, the Romeros informed FATIC that they believed the DIV to be greater than $95,000.00 and would be providing a report showing the property value. (AMF 43.) The Romeros provided FATIC with an appraisal from Brenda Wendt Consulting which provided that the DIV of the Property from the Encroachment was $119,000.00, $24,000.00 more than the appraisal by Otis B. Hackett. (AMF 44.) Plaintiffs’ own use of the DIV as the measure of “actual loss” indicates that they did not believe the term was ambiguous. Here, the evidence establishes that Plaintiffs had not waived their rights to provide additional proof to FATIC that their actual loss was greater, that Plaintiffs were free to submit their own appraisal within thirty days to FATIC, and that Plaintiffs, in fact, did so. (UMF 67; Romero Decl., Exh. DD; AMF 44.) Nothing before the Court indicates that Plaintiffs were limited to measuring their “actual loss” by the DIV of the property. Accordingly, Plaintiffs’ own use of the DIV as a measurement of “actual loss” provides further support that the term “actual loss” is not ambiguous. Drawing all reasonable inferences from this evidence in the light most favorable to the FATIC, the Court finds that Plaintiffs have failed to carry their burden establishing that “actual loss” is ambiguous. Again, “[a]lthough an ambiguity in an insurance contract will be resolved adversely to the insurer, some actual or apparent ambiguity must be present before this rule comes into play. The Court is not free to “impose coverage by adopting a strained or absurd interpretation in order to create an ambiguity where none exists.” (Liberty National Enterprises, L.P., supra, 217 Cal.App.4th at 77 (internal citations omitted).)

Based on the foregoing, the Court finds that Plaintiffs have failed to carry their burden establishing that the term “actual loss” as used in Section 4.a(5) is ambiguous. Still, because a finding that the term “actual loss” is not ambiguous is not determinative of whether FATIC’s payment of the “actual loss” to Plaintiffs ended FATIC’s duty to defend, the Court now turns to whether Section 4.a(5) is enforceable.

Enforceability of Condition 4.a(5)

Plaintiffs’ Property Rights

“[I]t has long been accepted that the sovereign may not take the property of A for the sole purpose of transferring it to another private party B, even though is paid just compensation.” (Kelo v. City of New London, Conn. (2005) 545 U.S. 469, 477.)

Plaintiffs first argue that Section 4.a(5) is unenforceable because their property rights are protected by the U.S. Constitution. Plaintiffs cite to a number of cases arguing that California Courts are hesitant to dilute property rights. Plaintiffs assert that here, they stand to lose 13% of their land while the Shih/Kos stand to gain 17% of the land they did not purchase and never owned. Plaintiffs contend that the disputed land is undeniably Romeros’ property and protected by the Constitution. Plaintiffs also argue that FATIC does not have the power to re-assign Romeros’ land to Shih/Ko, which Plaintiffs assert FATIC did by electing to fund all litigation expenses to facilitate the taking of Romeros’ land. Plaintiffs assert that if the government does not have the power to take private land for public use without due process, certainly FATIC does not have the power to take private land of one insured for the private use of another insured.

In opposition, FATIC argues that the takings clause is inapplicable here. FATIC asserts that it has not taken Plaintiffs’ private property, much less taken their property for public use and without just compensation. FATIC contends that it also has not “re-assigned” Plaintiffs’ property to Shih/Ko or “diluted” Plaintiffs’ property rights. FATIC argues that instead, FATIC properly issued a title insurance policy with respect to the Property, covering liens, defects in title, or other matters that existed when FATIC issued the policy. FATIC asserts that in accordance with California law and the terms of the Policy, FATIC provided the Romeros with a defense in the Shih/Ko action until FATIC paid the Romeros their loss, which terminated FATIC’s obligations under the Policy. FATIC contends that accordingly, the Romeros have been justly compensated for any loss.

FATIC argues that the various cases concerning property rights in general relied upon by Plaintiffs did not involve a dispute concerning coverage under a title insurance policy and are therefore inapposite.

The Court finds that Plaintiffs have failed to carry their burden establishing that there are no triable issues of material fact and that they are entitled to judgment as a matter of law on the issue of Section 4.a(5) being in violation of their property rights. The Court is unpersuaded by Plaintiffs’ arguments that FATIC’s invocation of Section 4.a(5) is analogous to a taking of Plaintiffs’ property without just compensation. Moreover, as correctly noted by FATIC, none of the cases Plaintiffs cite involve a dispute concerning coverage under a title insurance policy. (See Nellie Gail Ranch Owners Assn. v. McMullin (2016) 4 Cal. App. 5th 982, 1003; Shoen v. Zacarias (2015) 237 Cal.App.4th 16, 20-21.) Accordingly, the cases are inapposite here.

Public Policy

“There is no doubt that an insurance company can limit the coverage of a policy issued by it as long as such limitation conforms to the law and is not contrary to public policy; when it has done so the plain language of the limitation must be respected. [Citation.]” (Lumberman's Mut. Cas. Co. v. Wyman (1976) 64 Cal.App.3d 252, 259.)

Plaintiffs argue that Section 4.a(5) is unenforceable as against public policy. Plaintiffs assert that invoking Section 4.a(5) does not conform to legal protections of insureds and is contrary to public policy. Citing to Campbell v. Allstate Ins. Co ((1963) 60 Cal.2d 303, 307), Plaintiffs contend that an insureds’ reasonable expectation of defense for a covered risk is in the general public’s interest because it protects the public from bearing the costs of harm that an insurance policy purports to cover. Plaintiffs argue that if the Court were to agree that FATIC’s reliance on Condition 4.a(5) was proper, it would allow FATIC to: (1) operate as a quasi-government agency to privately re-assign property rights between its insureds; (2) deprive insureds of the right to defense; (3) evade contractual obligations of defense; (4) pick the winners and losers among their insureds; and (5) abandon some insureds, at FATIC’s sole discretion and “choice,” to fend for themselves while, at the same time, funding prosecution against them. Plaintiffs assert that such interpretation is clearly contrary to public interest.

In opposition, FATIC argues that Plaintiffs expressly agreed to the terms of the Policy and their interpretation would render Condition 4.a(5) meaningless, violating well-established rules of contractual construction. FATIC asserts that contrary to Plaintiffs’ contentions, the provision actually favors important public policy considerations, including the early and efficient resolution of covered claims and the prevention of unnecessary litigation.

The Court finds that Plaintiffs have failed to carry their burden establishing that there are no triable issues of material fact and that they are entitled judgment as a matter of law on the issue of Section 4.a(5) being unenforceable as against public policy. As noted above, insurance companies have the right to limit coverage of a policy so long as it conforms to law and is not contrary to public policy, and when it does so, the plain language of the limitation must be respected. Plaintiffs fail to cite to any authority asserting that a limitation to coverage is against public policy simply because it places a particular scenario outside of its coverage. Insurance policies are contractual in nature and when a party agrees to its terms, it cannot later argue that the terms are against public policy simply because it either did not understand the terms of the policy or no longer agrees with them.

Unconscionability

“‘The prevailing view is that [procedural and substantive unconscionability] must both be present in order for a court to exercise its discretion to refuse to enforce a contract or clause under the doctrine of unconscionability.’ [Citation] But they need not be present in the same degree. “Essentially a sliding scale is invoked which disregards the regularity of the procedural process of the contract formation, that creates the terms, in proportion to the greater harshness or unreasonableness of the substantive terms themselves.” [Citation] In other words, the more substantively oppressive the contract term, the less evidence of procedural unconscionability is required to come to the conclusion that the term is unenforceable, and vice versa.” (Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, 114.)

“‘Procedural unconscionability’ concerns the manner in which the contract was negotiated and the circumstances of the parties at that time. It focuses on factors of oppression and surprise. The oppression component arises from an inequality of bargaining power of the parties to the contract and an absence of real negotiation or a meaningful choice on the part of the weaker party. The component of surprise arises when the challenged terms are ‘hidden in a prolix printed form drafted by the party seeking to enforce them.’” (Nyulassy v. Lockheed Martin Corp. (2004) 120 Cal.App.4th 1267, 1281.)

Where a contract of adhesion includes the unequal bargaining power of contracting parties, with the weaker party's inability to negotiate, this may indicate procedural unconscionability in the form of oppression. (See Thompson v. Toll Dublin, LLC (2008) 165 Cal.App.4th 1360, 1372.) “The term ‘adhesion contract' refers to standardized contract forms offered to consumers of goods and services on essentially a ‘take it or leave it' basis without affording the consumer a realistic opportunity to bargain and under such conditions that the consumer cannot obtain the desired product or services except by acquiescing in the form contract. [Citations.] The distinctive feature of a contract of adhesion is that the weaker party has no realistic choice as to its terms. [Citations.]” (Wheeler v. St. Joseph Hospital (1976) 63 Cal.App.3d 345, 356.)

Plaintiffs also argue that Condition 4.a(5) is unenforceable under the general law of unconscionability. Plaintiffs argue that Condition 4.a(5) seeks to eliminate the Romeros’ basic right to defense, violates the Romeros’ property rights, and forces the Romeros to pay for their own defense for risks that fell within the Policy’s coverage. Plaintiffs assert that they had no bargaining power to negotiate the Policy. Plaintiffs contend that Condition 4.a(5) is also overly harsh and one-sided because it is only for the sole benefit of FATIC at the expense of the Romeros. Plaintiffs argue that it also effectively strips the Romeros of their reasonable expectation of defense and property. Plaintiffs assert that if Condition 4.a(5) was enforceable, insureds without resources to finance their own defense for a Covered Risk would be forced into default judgments and/or bankruptcy or both. Plaintiffs contend that such an interpretation is unconscionable and does not comport with the spirit of the law and justice.

In opposition, FATIC argues that the Section 4.a(5) is not unconscionable. FATIC asserts that in the instant case, Plaintiffs do not and cannot claim that they had no real alternatives to the Policy at the time they entered into the agreement. FATIC contends that, to the contrary, Plaintiffs always had the option of looking for other title insurance policies issued by other insurers. FATIC argues that Plaintiffs also cannot claim that Section 4.a(5) was a surprise, as the provision was set forth in the same sized text as the rest of the agreement, under the clear heading in all capitalized and bold font: “4. OUT [FATIC’s] CHOICES WHEN WE LEARN OF A CLAIM.” (UMF 10, 29; Romero Decl., Exh. C.) FATIC asserts that this was not a term buried in a prolix form. FATIC contends that these facts weigh against a finding of procedural unconscionability.

The Court finds that Plaintiffs have failed to carry their burden establishing that there are no triable issues of material fact and that they are entitled to judgment as a matter of law on the issue of Section 4.a(5) being unconscionable. Plaintiff has failed to present any evidence that Plaintiffs had no bargaining power to negotiate the Policy nor that they had no alternative to the Policy at the time they entered into the agreement. Accordingly, Plaintiffs have failed to carry their burden establishing with undisputed facts that Section 4.a(5) is procedurally unconscionable.

 

Conspicuous, Plain, and Clear

“[I]n a situation in which the public may reasonably expect coverage, must be conspicuous, plain and clear.” (Steven v. Fidelity & Cas. Co. of New York (1962) 58 Cal.2d 862, 878.)

Plaintiffs finally argue that Condition 4.a(5) is unenforceable because they had a reasonable expectation of defense and the removal of this decades-old protection is neither conspicuous, plain, or clear.

In opposition, FATIC argues that for all the reasons previously discussed, including the size of the text, Section 4.a(5) is clear and unambiguous. FATIC asserts that Plaintiffs erroneously rely on the decision in Steven v. Fidelity & Cas. Co. if New York (supra, 58 Cal.2d 862), which involved a standardized contract of airplane trip insurance sold by means of a vending machine. FATIC contends that Steven is easily distinguishable from the instant case and fails to support Plaintiffs’ position that Section 4.a(5) is unenforceable.

The Court finds that Plaintiffs have failed to carry their burden establishing that there are no triable issues of material fact and that it they are entitled to judgment as a matter of law as to the issue of Section 4.a(5) being unenforceable because it is not conspicuous, plain, and clear. Plaintiffs fail to present any evidence that Section 4.a(5) is not conspicuous, plain, or clear, such as evidence that the text size was smaller than other provisions or that the provision was buried at the end of the policy and not clearly labeled. Absent such evidence, Plaintiffs have failed to establish that Section 4.a(5) was not conspicuous, plain, or clear.

Given that Plaintiffs have failed to carry their burden establishing that Section 4.a(5) is unenforceable, the Court finally turns to whether FATIC’s payment of “actual loss” ended its duty to defend.

Payment of “Actual Loss”

Plaintiffs finally argue that FATIC’s payment did not exonerate its continued duty to defend because under Condition 4.a(5), FATIC could only end coverage by paying actual loss, i.e, the amount determined upon final resolution of the Shih/Ko case.

Given the Court’s ruling finding that the term “actual loss” is not ambiguous and means DIV of the property, the Court finds that Plaintiffs have failed to carry their burden establishing that there are no triable issues of material fact and that they are entitled to judgment as a matter of law on this issue of FATIC owing Plaintiffs a continuing duty to defend until the final resolution of the underlying action. Pursuant to the terms of the policy, upon payment of Plaintiffs’ actual loss pursuant to Condition 4.a(5), FATIC’s “obligations for the claim end, including [its] obligation to defend, or continue to defend, any legal action.” (Romero Decl., Exh. C.) Here, the undisputed material facts establish that (i) FATIC elected to pay the Romeros their loss under Condition 4.a(5) (UMF 54); (ii) based on the Hackett Appraisal, the DIV resulting from the encroachment is $95,000 (UMF 65); and (iii) FATIC tendered a check to the Romeros for $95,000. (AMF 38.) Accordingly, Plaintiffs have failed to establish as a matter of law that FATIC owes Plaintiffs a continuing duty to defend until the final resolution of the underlying action.

Based on the foregoing, Plaintiffs’ motion for summary adjudication is DENIED.

Conclusion

Plaintiffs’ motion for summary adjudication is DENIED. 

The parties are strongly encouraged to attend all scheduled hearings virtually or by audio. Effective July 20, 2020, all matters will be scheduled virtually and/or with audio through the Court’s LACourtConnect technology. The parties are strongly encouraged to use LACourtConnect for all their matters. All social distancing protocols will be observed at the Courthouse and in the courtrooms.



Case Number: ****6649    Hearing Date: July 07, 2020    Dept: 31

PLAINTIFFS' MOTION FOR PROTECTIVE ORDER IS GRANTED, IN PART.

Background

Plaintiffs Cesar Romero (“Cesar”) and Tatana Romero (“Tatana”) sued Defendants First American Title Insurance Company (hereinafter “FATIC”), First American Title Company, and Prominent Escrow Services, Inc. for compensatory and injunctive relief, based on allegations that Plaintiffs’ non-party neighbor’s home improvements encroached onto Plaintiffs’ property. Plaintiffs also claim that FATIC, which provided Plaintiffs’ title insurance, acted in bad faith by improperly favoring Plaintiffs’ neighbors, “Shih/Ko,” in the dispute over the alleged encroachment and failed to pay Plaintiffs adequate damages to compensate for the diminution in value of their property caused by the encroachment. In the operative Second Amended Complaint (“SAC”), Plaintiffs assert causes of action for:

  1. Breach of Contract by Escrow Agents and Fiduciaries for Failure to Comply with Instructions;

  2. Negligence by Escrow Agents and Fiduciaries in the Performance of Their Duties;

  3. Breach of Fiduciary Duty;

  4. Damages for Negligent Representation;

  5. Damages for Fraud;

  6. Breach of Insurance Contract;

  7. Breach of the Duty of Good Faith and Fair Dealing; and

  8. Unfair Business Practices.

    The sixth, seventh, and eighth causes of action are pending against FATIC because the Court sustained FATIC’s demurrer to the first, second, third, fourth, and fifth causes of action without leave to amend on May 9, 2018. Also, as a result of sustaining the demurrer without leave to amend on May 9, 2019, Defendant First American Title Company was dismissed with prejudice, as the first through fifth causes of action were the only ones asserted against it. On January 31, 2019, Plaintiffs dismissed Defendant Prominent Escrow Services, Inc. with prejudice.

    Plaintiffs move for a protective order regarding the confidentiality of Plaintiffs’ medical examinations and other medical information.

    Legal Standard

    “The court, for good cause shown, may make any order that justice requires to protect any party, deponent, or other natural person or organization from unwarranted annoyance, embarrassment, or oppression, or undue burden and expense.” (Code Civ. Proc., ; 2025.420(b).) Courts have considerable discretion in granting and crafting protective orders. (Raymond Handling Concepts Corp. v. Superior Court (1995) 39 Cal.App.4th 584, 588.)

    Request for Judicial Notice

The court may take judicial notice of “official acts of the legislative, executive, and judicial departments of the United States and of any state of the United States,” “[r]ecords of (1) any court of this state or (2) any court of record of the United States or of any state of the United States,” and “[f]acts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” (Evid. Code ; 452, subds. (c), (d), and (h).) 

FATIC requests that the Court take judicial notice of a number of documents filed in this action and in the related action. The request is GRANTED.

Plaintiffs on reply similarly request that the Court take judicial notice of a number of documents filed with the Court in LASC Case No. 18PDSC05394. 

“Although a court may judicially notice a variety of matters (Evid.Code, ; 450 et seq.), only relevant material may be noticed.” (Mangini v. R. J. Reynolds Tobacco Co. (1994) 7 Cal.4th 1057, 1063 (overruled by In re Tobacco Cases II (2007) 41 Cal.4th 1257 on other grounds).) The Court finds that the material to be judicially noticed is immaterial to the disposition of the motion. Accordingly, the request is DENIED.

Evidentiary Objections

FATIC submits a number of objections to Plaintiffs’ declarations submitted in support of their moving and reply papers. The objections are immaterial to the Court’s disposition of the motion. The Court thus declines to rule upon them.

Plaintiffs similarly submit a number of objections to the Declarations of Lisa Boswell and Zachary Gidding. Objection 14 to the Declaration of Lisa Boswell is OVERRULED. The remaining objections are immaterial to the Court’s disposition of the motion. The Court thus declines to rule upon them.

Discussion

Plaintiffs move for a protective order regarding confidentiality of Plaintiff’s mental examinations and other medical information as follows:

  1. Neither FATIC nor their counsel or agents, including, but not limited to, Dr. Dupee and her agents, shall release any Protected Material to the public or any third party for any reason. This Protected Material shall include any of Plaintiffs’ Medical Information that might be known to FATIC and/or its agents now, in the future and/or prior to this Order.

  1. For the purposes of this Order, “Protected Material” shall include, but is not limited to, documents, reports, audio recordings, information and/or communications involving highly sensitive, personal, private and/or medical information relating to the Plaintiffs’ Mental Examinations.

  2. For the purposes of this Order, “Medical Information” means any individually identifiable information, in electronic or physical form, in possession of or derived from a provider of health care, health care service plan, pharmaceutical company, contractor or any other source regarding a patient’s medical history, mental or physical condition, or treatment.

  3. “Individually identifiable” means that the medical information includes or contains any element of personal identifying information sufficient to allow identification of the individual, such as the patient’s name, address, electronic mail address, telephone number, or social security number or other information that, alone or in combination with other publicly available information, reveals the individual’s identity.

  1. FATIC may use the Protected Material only for the extremely limited purpose of prosecuting, defending, or attempting to settle this case.

  2. If Protected Materials and/or transcripts or other materials containing Protected Material are submitted to or otherwise disclosed to the court in connection with motions and proceedings, the same shall be separately filed under seal with the clerk of the court in an envelope marked: “CONFIDENTIAL – FILED UNDER SEAL PURSUANT TO PROTECTIVE ORDER AND WITHOUT ANY FURTHER SEALING ORDER REQUIRED.”

  3. In the event that a court reporter is present during any proceedings, any testimony relating to the Protected Material will be considered confidential, protected and sealed pursuant to the [Proposed] Order. IF portions of the transcript containing and/or referring to the Protected material need to be filed as part of any motions or appeals, the transcript shall be separately filed under seal with clerk of the court in an envelope marked: “CONFIDENTIAL – FILED UNDER SEAL PURSUANT TO PROTECTIVE ORDER AND WITHOUT ANY FURTHER SEALING ORDER REQUIRED.”

  4. Within 60 days after the final disposition of this action, FATIC must return all Protected Material, including any materials containing portions of Protected Material, to Plaintiffs or destroy such materials containing portions of Protected Material, to Plaintiffs or destroy such material and submit a written certification to Plaintiffs by the 60-day deadline. The destruction will include purging computer backups, cloud or other electronic data storage systems of Plaintiffs’ Protected Material.

Plaintiffs argue that FATIC refused to agree to enter into a Stipulation to protect the confidentiality of Plaintiffs’ mental examinations and medical information rendering the instant motion necessary.

In opposition, FATIC argues that Plaintiffs do not, in any way, justify the unreasonable provisions of their proposed order, which provides that FATIC cannot even disclose information from the independent medical examinations (IMEs) to the jury, the entire purpose of the IMEs. FATIC asserts that the record should be clear about what happened here: in January, the Court ordered Plaintiffs to appear for IMEs before Dr. Suzanne Dupee, and rejected Plaintiffs’ demand that it enter a protective order governing the IMEs, leaving the matter of any confidentiality stipulation to the parties themselves. FATIC contends that it immediately began meeting and conferring with Plaintiffs and sent them a proposed protective order based on a protective order the Court entered in August. FATIC argues that Plaintiffs rejected FATIC’s proposal and insisted on many new absurd conditions. FATIC asserts that when it would not agree to the unreasonable conditions, Plaintiffs strung FATIC along for another month, then filed the instant motion without meeting and conferring. FATIC contends that as the full record demonstrates, Plaintiffs do not want to appear for their IMEs and are willing to engage in any delay tactic to avoid them. FATIC argues that the instant motion is just more delay, containing almost no substantive argument or evidence supporting the proposed order.

In reply, Plaintiffs argue that they have a reasonable expectation of privacy in their medical records. Plaintiffs assert that the mere initiation of their lawsuit for, among other things, emotional distress damages may have partially waived Plaintiffs’ right to privacy as to what can and cannot be disclosed to FATIC, but it does not translate to disclosure of Plaintiffs’ privacy, confidential and medical information to third parties without any protections in place. Accordingly, the instant motion is justified and necessary.

Plaintiffs contend that the existing protective order is limited to Dr. Corrado’s records. Plaintiffs assert that accordingly, FATIC’s unwillingness to stipulate to protecting Plaintiffs’ medical information because it “conflict[s] with the existing medical (psychologist) records protective order entered by the Court on August 23, 2019” is disingenuous. Plaintiffs argue that the existing Protective Order does not protect all of Plaintiffs’ medical information that any medical experts may obtain relating to this case. Plaintiffs assert that Dr. Dupee previously submitted a declaration to this Court stating that she plans to take Plaintiffs’ “very detailed medical history” as part of her medical examinations. Plaintiffs contend that if any medical information is disclosed, before, or after the IME, Plaintiffs have the right to protect the information from disclosure to third parties.

Information in the Public Record & Known to FATIC Prior to IMEs

Plaintiffs assert that among other things, FATIC insists on including the following paragraph:

However, the protections conferred by this Stipulation and Order do not cover the following information: (a) any information that is in the public domain at the time of disclosure to FATIC or becomes part of the public domain after its disclosure to FATIC as a result of publication not involving a violation of this Order, including becoming part of the public record through trial or otherwise; and (b) any information known to FATIC prior to the disclosure or obtained by FATIC after the disclosure from a source who obtained the information lawfully and under no obligation of confidentiality to Plaintiffs.

Plaintiffs contend that FATIC’s insistence on including such a paragraph would render the entire protective order useless and moot as FATIC is suggesting that they currently have Plaintiffs’ medical information from an unknown “source,” which they do not want to hold confidential and to which they do not want to stipulate to protect from disclosure to the public or third parties. Plaintiffs argue that if FATIC is in possession of any medical information not previously produced by Plaintiffs, the only way FATIC was able to get it was through illegal means.

FATIC argues that it is unreasonable to prevent FATIC from using or disclosing public information or other information not obtained from the IMEs. FATIC asserts that protective orders are not intended to govern public information. FATIC argues that without the restriction proposed, Plaintiffs’ proposed protective order would prevent FATIC from using any information disclosed to Dr. Dupee during the examination including underlying facts of the case, whether or not that information is medical in nature or was already public or known to FATIC.

In reply, Plaintiffs argue that they cannot agree to a provision that creates a multitude of ambiguities and loop holes for FATIC to exploit. Plaintiffs assert that FATIC does not want to agree that deposition transcripts containing protected material must be filed under seal, does not want to agree that its vendors, consultants, mock jury and witnesses are bound by the protective order, essentially giving third parties a green light to do whatever they want, including publishing and disclosing Plaintiffs’ information in the public docket because they would not be bound by the protective order. As to the “source” FATIC refers to, Plaintiffs contend that if a “source” exists that has possession of Plaintiffs’ medical information, then the information was obtained in violation of HIPAA laws – no one can disclose Plaintiffs’ medical information short of a court order.

Plaintiffs argue that under their version of the protective order, no one is depriving FATIC of the ability to prepare a defense to Plaintiffs’ claim of emotional distress. Plaintiffs assert that they are simply asking that their protected material remain protected and is only used in a limited manner without being published and without being disseminated to irrelevant third parties.

The Court finds that Plaintiffs have established good cause for the removal of FATIC’s proposed provision from the protective order. It is undisputed that Plaintiffs’ medical information is afforded constitutional protections under a person’s right to privacy. While FATIC would like to exclude protected information that is a part of the public record or that was previously known to FATIC prior to the IMEs, the Court finds that it would be extremely difficult if not impossible to determine when the relevant medical information was obtained by FATIC and through what means. Nothing before the Court indicates that FATIC will be prejudiced if they are required to provide protections to cover all of Plaintiffs’ medical information. FATIC’s compliance would not deprive it of the ability to prepare or present a defense as to Plaintiffs’ emotional distress claims.

Retention of Protected Material

Plaintiffs assert that FATIC also insists on including the following provision:

FATIC and its counsel are entitled to retain archival copies of all pleadings, discovery including the Protected Materials, motion papers, trial, deposition, and hearing transcripts, legal memoranda, correspondence, deposition and trial exhibits, expert reports, attorney work product, and consultant and expert work product, even if such materials contain Protected Material. Any such archival copies that contain or constitute Protected Material remain subject to this Protective Order. Nothing herein will be deemed to require those identified in paragraph 4.2(a) through (i) above to purge computer backups, iCloud or other electronic data storage systems of the Protected Material.

In opposition, FATIC argues that its counsel must retain protected material for insurance purposes. FATIC asserts that its counsel carries malpractice insurance which requires the firm to retain files as archival copies for a minimum of five years. (Boswell Decl. ¶ 16.) FATIC contends that the prior protective order entered by this Court in August 2019 contains a provision permitting FATIC’s counsel to retain archival copies of the covered materials to comport with this insurance requirement. FATIC argues that there is no cause to prevent its counsel from complying with its insurance carrier’s requirements. As to documents that they are not required to retain for insurance purposes, FATIC asserts that it was willing at all times to agree to return or destroy those documents.

In reply, Plaintiffs argue that during the meet and confer process, FATIC did not raise any issues relating to their malpractice insurance carrier requiring them to keep records for 5 years following final disposition of cases. Plaintiffs assert that FATIC’s declaration attesting to the same is hearsay without any evidentiary support. Plaintiffs contend that by failing to raise the issue of malpractice insurance requirements during the meet and confer process, FATIC has waived that purported issue/excuse. Plaintiffs argue that moreover, if such a requirement were real, FATIC would have filed some sort of document evidencing the malpractice requirement as part of its compendium of exhibits filed in connection with the motion.

The Court finds that FATIC has established a need for the inclusion of the above provision and that Plaintiffs have not adequately established good cause for its exclusion. Plaintiffs’ argument is based on their contention that FATIC has failed to provide adequate evidence of FATIC’s malpractice insurance requirements. However, as noted above, Plaintiffs’ objection was overruled. Moreover, the declaration of Lisa Boswell was made under penalty of perjury. Accordingly, the statement is sufficient evidence of the requirement. However, the Court will require language limiting the retention of archival copies only as necessary to comport with FATIC’s malpractice insurer’s requirements.

Other Provisions

Plaintiffs contend that FATIC adopted a hard-line position on additional issues. Plaintiffs argue that FATIC refused to incorporate a number of provisions related to: reports prepared by FATIC’s experts (Proposed Order ; 4.1); allowing depositions, transcribed data, exhibits and other testimony to become a part of the public record “unless ordered by the court” (Proposed Order ; 7); limiting the use of reports prepared by experts and any testimony for extremely limited use only (Proposed Order ; 4.1); limiting the presence of persons in the courtroom when testimony of Plaintiffs’ protected material is discussed to only those persons who are necessary (Proposed Order ; 4.1); keeping information secure, password protected, and preventing any breaches of Plaintiffs’ information (Proposed Order ; 4.1); having their counsel, agents, copy vendors, document management vendors, and others be bound by the protective order (Proposed Order ; 4.2); Plaintiffs’ right to further relief if FATIC violates the protective order (Proposed Order ; 5.1); a damages clause (Proposed Order ; 5.2); the disposal of copies containing the protected material after the final disposition of this action (Proposed Order ; 6); filing the protected material under seal (Proposed Order ; 7); and a violations provision (Proposed Order ; 8.)

Plaintiffs asserts that the current circumstances require the issuance of a protective order given the highly sensitive nature of the Court-ordered mental examinations that will involve private, personal, and/or medical information.

In opposition, FATIC asserts that Plaintiffs have not justified the proposed restrictions. FATIC contends that FATIC advocated for a proposed protective order substantially identical to the order governing Plaintiffs’ medical records. FATIC argues that the proposed order addressed a number of the concerns Plaintiffs now raise. FATIC asserts that at no point do Plaintiffs give a single explanation of why any provision of their proposed protective order is warranted. FATIC contends that instead, Plaintiffs simply list the restrictions they claim FATIC was unwilling to agree to followed by a recitation of the law authorizing courts to enter protective orders.

Automatic Sealing of Protected Material

The Proposed Order includes the following provisions:

In the event that a court reporter is present, any testimony relating to the Protected Material will be considered confidential pursuant to this Order. If portions of the transcript containing and/or referring to the Protected Material need to be filed as part of any motions or appeals, the transcript shall be separately filed under seal with the clerk of the court in an envelope marked: “CONFIDENTIAL – FILED UNDER SEAL PURSUANT TO PROTECTIVE ORDER AND WITHOUT ANY FURTHER SEALING ORDER REQUIRED.” . . .

Designation in conformity with this Order requires:

a. For information in documentary form (e.g. paper or electronic documents) the following legend is affixed “CONFIDENTIAL” to each page that contains protected material and filed under seal.

b. For testimony given in deposition or in other pretrial or trial proceedings, the entire transcript shall be treated as “CONFIDENTIAL”, filed under seal and not accessible to any third parties.

c. Parties shall give the other parties notice if they reasonably expect a deposition, hearing or other proceeding to include Protected Material so that the other parties can ensure that only authorized individuals who have signed the “Acknowledgement and Agreement to Be Bound” (Exhibit A) are present at those proceedings. The use of a document as an exhibit at a deposition shall not in any way affect its designation as “CONFIDENTIAL” and shall be filed under seal.

d. Transcripts containing any Protected Material shall have an obvious legend on the title page that the transcript contains Protected Material and is to be treated as “CONFIDENTIAL” and filed under seal. The designating party shall inform the court reporter of these requirements. Any transcript that is prepared shall be treated as “CONFIDENTIAL” in its entirety.

e. For information produced in some form other than documentary and for any other tangible items, that the producing party affix in a prominent place on the exterior of the container or containers in which the information or time is stored the legend “CONFIDENTIAL” and filed under seal.

(Proposed Order ;; 4.1, 7.)

In opposition, FATIC asserts that it already agreed to protect Plaintiffs’ medical information as evidenced by FATIC’s January 30, 2020 proposed order and FATIC’s February 18, 2020 modified proposed order. (Gidding Decl., Exh. 5, 10.) FATIC contends that what it refused to agree to is a blanket procedure whereby any protected material could be filed under seal without a further showing or sealing order. FATIC argues that the Rules of Court provide a reliable and exacting procedure for filing documents under seal, which was the procedure FATIC proposed to follow in its proposed order with some caveats for discovery motions or other proceedings not governed by California Rules of Court. FATIC asserts that allowing Plaintiffs to sidestep this procedure and file documents under seal by simply including protected material in them, whether or not it is necessary to the matter at issue, will have the effect of “locking up” the record in this case, making it difficult for FATIC to confer with trial consultants, mock juries, and other third parties.

In reply, Plaintiffs argue that FATIC’s position is unreasonable and would render the protective order useless since it would allow FATIC to file in the public court docket transcripts containing the protected material, forcing waiver of whatever protections may have initially existed.

The Court finds that Plaintiffs have failed to establish good cause for requiring that any transcripts containing or referring to the protected material be automatically filed under seal. As correctly noted by FATIC, the California Rules of Court provide for a procedure for sealing records. (See CRC Rules 2.550. 2.551.) The Court will not allow any party, whether it be Plaintiffs or FATIC, to bypass such a procedure given the right of public access to the record. (See Art I, sec. 3, subsection (b)(1) of the California Constitution.) Contrary to Plaintiffs arguments, a request to file a motion under seal will not automatically allow FATIC to file any confidential information in the docket without recourse. Instead, requiring that both parties move to file a document or motion under seal will ensure that Plaintiffs’ interests in privacy and the public’s interest in access to the record are sufficiently balanced.

Courtroom Attendance

The Proposed Order includes the following provisions regarding courtroom attendance:

When Dr. Dupee, or any other expert witness, is ready to give a testimony relating to the protected material, the court room attendance will be strictly limited to category of persons bound by this Order and who have signed the “Acknowledgement and Agreement to Be Bound.” . . .

Parties shall give the other parties notice if they reasonably expect a deposition, hearing or other proceeding to include Protected Material so that the other parties can ensure that only authorized individuals who have signed the “Acknowledgement and Agreement to Be Bound” are present at those proceedings. The use of a document as an exhibit at a deposition shall not in any way affect its designation as “CONFIDENTIAL.”

Transcripts containing any Protected Material shall have an obvious legend on the title page that the transcript contains Protected Material and is to be treated as “CONFIDENTIAL.” The designating party shall inform the court reporter of these requirements. Any transcript that is prepared shall be treated as “CONFIDENTIAL” in its entirety and not available to any third parties.

(Proposed Order ;; 4.1, 7.)

In opposition, FATIC contends that there is no ground to close trial proceedings to the public. FATIC argues that by the language Plaintiffs insist upon, they would be able to exclude all but “authorized individuals who have signed the ‘Acknowledgement and Agreement to Be Bound’” from attending trial or other court proceedings where testimony is given concerning protected material, and would be able to demand sealing of the transcripts of trial proceedings. FATIC asserts that this runs afoul of statutory and constitutional guarantees of open court hearings and FATIC cannot acquiesce to it. FATIC contends that its proposed protective orders would have restricted pretrial disclosure without running afoul of any statutory or constitutional prescriptions but Plaintiffs refused to agree to them.

In reply, Plaintiffs argue that its proposal is reasonable and that it would take less than 60 seconds for the Court to advise all third parties in the room to leave. Plaintiffs assert that if protected material needs to be argued during a regular hearing, the Court can simply put the case last on the calendar after all other parties have left the courtroom. Plaintiffs contend that the only explanation for FATIC’s disagreement is that they want to have some unidentified third parties present who could then be privy to Plaintiffs’ protected material in violation of Plaintiffs’ rights.

The Court finds that Plaintiffs have failed to establish good cause for limiting those in attendance at a hearing and/or trial. As correctly noted by FATIC, such a limitation runs afoul of statutory and constitutional guarantees of open court hearings. As held by the California Supreme Court, “before substantive courtroom proceedings are closed or transcripts are ordered sealed, a trial court must hold a hearing and expressly find that (i) there exists an overriding interest supporting closure and/or sealing; (ii) there is a substantial probability that the interest will be prejudiced absent closure and/or sealing; (iii) the proposed closure and/or sealing is narrowly tailored to serve the overriding interest; and (iv) there is no less restrictive means of achieving the overriding interest.” (NBC Subsidiary (KNBC-TV), Inc. v. Superior Court (1999) 20 Cal.4th 1178, 1217–1218.) Plaintiffs have failed to provide evidence to support these specific findings.

Storing of Protected Materials

The Proposed Order contains the following provision regarding the storing of protected materials:

Protected Material must be stored and maintained by FATIC at a location and in a secure manner that ensures that access is limited to the persons authorized under this Order. At a minimum, any electronic Protected Material should be password-protected.

(Proposed Order ; 4.1.)

In opposition, FATIC argues that there is no cause to order such a requirement. FATIC asserts that the language is unacceptably vague, rendering it difficult to know under what circumstances counsel might be out of compliance with it. FATIC contends that additionally, the password-protection requirement imposes a substantial burden on FATIC. FATIC argues that sending electronic versions of the protected material to experts, consultants, document vendors, and to the client would require password-protecting the email or attachments, which would impair the ability of FATIC’s counsel to review the emails later if necessary. FATIC asserts that such a provision would also make FATIC the insurer of their experts’, consultants’, and document vendors’ compliance with the password-protection requirement despite the fact that FATIC has no control over or knowledge of their respective computer systems. FATIC contends that Plaintiffs have not shown why this restriction is necessary.

In reply, citing to the Code of Federal Regulations, Plaintiffs argue that HIPAA regulation sets strict national privacy and security standards. Plaintiffs assert that their request for FATIC to protect their medical information by implementing at least a password when it comes to accessing Plaintiffs’ protected material is not unreasonable. Plaintiffs contend that FATIC can set up a folder and password under 60 seconds – hardly a burden.

The Court finds that Plaintiffs have failed to establish good cause for dictating the manner in which FATIC must store protected materials. While Plaintiffs argue that HIPPA regulations require the use of passwords, those provisions apply only to covered entities such as a health plan, a health care clearinghouse, and a health care provider who transmits certain health information. (45 C.F.R. ; 160.103.) Plaintiffs have not provided any evidence that FATIC’s current method for storing information that has previously been deemed protected is insufficient.

Third Parties & Further Relief

The Proposed Order also contains provisions related to third parties and further relief:

Unless otherwise ordered by the court or permitted in writing by Plaintiffs, FATIC may use and disclose other Protected Material only to:

(c) Persons with specialized knowledge or experience in a matter pertinent to the case who have been retained by FATIC or its counsel to serve as an expert witness or as a consultant in this action, and who have signed the “Acknowledgement and Agreement to Be Bound”

(e) Court reporters and their staff, videographers, interpreters provided they have signed the “Acknowledgement and Agreement to Be Bound”

(g) FATIC’s and/or its counsel’s attorney service(s), copy vendor(s), and document management vendor(s) provided he or she has signed the “Acknowledgement and Agreement to Be Bound.” . . .

Right to Further Relief. Plaintiffs have the option to seek further relief should they so desire.

(Proposed Order ;; 4.2, 5.1.)

In opposition to Plaintiffs’ arguments that FATIC refused to stipulate to the provisions above, FATIC argues that it has already agreed to such terms and, in fact, included such provisions in its proposed protective orders. FATIC only asserts that the proposed protective order is too restrictive, as it does not even permit information from the IMEs to be disclosed to the jury, referring to Plaintiffs’ removal of item (i), permitting the disclosure of protected material to witnesses at trial and hearings in this action; item (f) which states that disclosure is allowed in the following instance: “During their depositions, witnesses in the action who are privy to the Protected Material and/or to whom disclosure is reasonably necessary and who have signed the “Acknowledgement and Agreement to Be Bound” (Exhibit A), unless otherwise agreed by Plaintiffs or ordered by the court;” and item (j), permitting the disclosure of protected material to jurors at trial.

In reply, Plaintiffs argue that there is no reason for any third party, other than medical expert witnesses, to gain access to transcripts that contain the protected material. Plaintiffs assert that the only witnesses that should have access to the protected material is FATIC’s and Plaintiffs’ medical expert witnesses, and those witnesses will be bound by the protective order per Section 4.2(c) of the proposed order. Plaintiffs contend that FATIC has not shown good cause and have failed to explain why Plaintiffs’ protected material should be disclosed to witnesses aside from the designated experts and/or consultants.

The Court finds that Plaintiffs have failed to establish good cause for excluding the provision allowing disclosure of protected materials to witnesses at trial and hearings, to witnesses at deposition who are privy to the protected material and/or to whom disclosure is reasonably necessary and who have signed the “Acknowledgement and Agreement to Be Bound,” and to jurors at trial. The elimination of such provisions renders the Court-ordered IMEs purposeless, as it would preclude FATIC from introducing such evidence at trial. The Court finds that the language provided by FATIC in items 4.2(i), (f), and (j) in their proposed orders is sufficient to protect Plaintiffs’ protected materials from disclosure to third parties who have no need for the information.

As to the provision regarding further relief, the Court finds that the language provided by FATIC provides for the same substantive protections proposed by Plaintiffs, instead stating that further relief is available for both parties, not just Plaintiffs. Still, it is unclear what FATIC would stand to gain from a violation of the instant protective order such that further relief would be needed. The Court thus finds that Plaintiffs have established good cause for the further relief provision in their proposed order.

Damages

The Proposed Order includes the following provisions related to damages and violations:

In the event that any party bound by this Order hereunder shall fail to adequately protect the materials as set forth herein and pursuant to the provisions of this agreement, Plaintiffs shall be deemed to have sustained damages resulting from FATIC’s breach or failure to perform, which damages the parties acknowledge are difficult and impracticable to ascertain. Accordingly, in such event Plaintiffs shall be entitled to damages in the amount of one hundred thousand dollars ($100,000) as a liquidated and reasonable estimate of such damages, and as Plaintiffs’ remedy against FATIC, for FATIC’s breach and failure to protect the Plaintiffs’ Protected Material. . . .

VIOLATIONS. Any violation of this Order may be punished by any and all appropriate measures including, without limitation, contempt proceedings and/or monetary sanctions in addition to the mandatory amount of damages set forth herein.

(Proposed Order ;; 5.2, 8.)

In opposition, FATIC contends that such a provision is unreasonable and unwarranted. FATIC argues that there is no need for a liquidated damages clause in a protective order at all given that it is already the case that a party’s disobedience of a discovery order may be punished by contempt, as well as an award of any reasonable expenses caused by the disobedience. (Code of Civ. Proc., ;; 2023.010, 2023.030.) FATIC asserts that what is more, the proposed language does not even require actual disclosure of protected information for the liquidated damages to apply, nor that FATIC be in any way be responsible for the disclosure.

In reply, Plaintiffs argue that they agreed to take out the monetary damages section.

Given Plaintiffs’ concession regarding the damages and violations sections, the Court finds that Plaintiffs have failed to establish good cause for the inclusion of such provisions.

Conclusion

Based on the foregoing, Plaintiffs’ motion for protective order is GRANTED, in part. FATIC is ordered to file a modified proposed protective order consistent with this Order. The Court declines FATIC’s request for sanctions.

The parties are strongly encouraged to attend all scheduled hearings by telephone or CourtCall. All social distancing protocols will be observed at the Courthouse and in the courtrooms.

Moving parties to give notice.



Case Number: ****6649    Hearing Date: July 02, 2020    Dept: 31

MOTION FOR STAY OF IME ORDER IS DENIED.

Background

Plaintiffs Cesar Romero (“Cesar”) and Tatana Romero (“Tatana”) sued Defendants First American Title Insurance Company (hereinafter “FATIC”), First American Title Company, and Prominent Escrow Services, Inc. for compensatory and injunctive relief, based on allegations that Plaintiffs’ non-party neighbor’s home improvements encroached onto Plaintiffs’ property. Plaintiffs also claim that FATIC, which provided Plaintiffs’ title insurance, acted in bad faith by improperly favoring Plaintiffs’ neighbors, “Shih/Ko,” in the dispute over the alleged encroachment and failed to pay Plaintiffs adequate damages to compensate for the diminution in value of their property caused by the encroachment. In the operative Second Amended Complaint (“SAC”), Plaintiffs assert causes of action for:

  1. Breach of Contract by Escrow Agents and Fiduciaries for Failure to Comply with Instructions;

  2. Negligence by Escrow Agents and Fiduciaries in the Performance of Their Duties;

  3. Breach of Fiduciary Duty;

  4. Damages for Negligent Representation;

  5. Damages for Fraud;

  6. Breach of Insurance Contract;

  7. Breach of the Duty of Good Faith and Fair Dealing; and

  8. Unfair Business Practices.

    The sixth, seventh, and eighth causes of action are pending against FATIC because the Court sustained FATIC’s demurrer to the first, second, third, fourth, and fifth causes of action without leave to amend on May 9, 2018. Also as a result of sustaining the demurrer without leave to amend on May 9, 2019, Defendant First American Title Company was dismissed with prejudice, as the first through fifth causes of action were the only ones asserted against it. On January 31, 2019, Plaintiffs dismissed Defendant Prominent Escrow Services, Inc. with prejudice.

    On January 30, 2020, the Court granted FATIC’s Motion for an Independent Medical Examination (“IME”) of Plaintiffs.

    Plaintiffs move for an order staying the Court’s January 30, 2020 Order granting FATIC’s Motion for Independent Medical Examination of Plaintiffs pending the resolution of Plaintiffs’ related Motion for Protective Order of the Mental Examination Records and Other Medical Information sought by FATIC.

    Legal Standard

    “Trial courts generally have the inherent power to stay proceedings in the interests of justice and to promote judicial efficiency.” (Freiberg v. City of Mission Viejo (1995) 33 Cal.App.4th 1484, 1489.)

    Evidentiary Objections

    FATIC submits a number of objections to the Declarations of Cesar Romero and Tatiana Romero in support of their motion and in support of their reply. The objections are immaterial to the Court’s disposition of the motion. The Court thus declines to rule upon them.

    Plaintiffs likewise submit a number of objections to the Declaration of Lisa Boswell in support of FATIC’s opposition.

    Objection No. 11 is OVERRULED.

    The remaining objections are immaterial to the Court’s disposition of the motion. The Court thus declines to rule upon them.

    Discussion

    The Court notes at the outset that Plaintiffs’ reply requests relief not originally requested in their moving papers, namely that the Court amend its January 30, 2020 Order to allow Plaintiffs to appear remotely for their IMEs and for various sanctions. Such requests are inappropriate in reply, as they deprive FATIC of an opportunity to be heard. Accordingly, the Court disregards Plaintiffs’ reply papers to the extent that they request such relief.

    Moreover, the Court notes that the majority of Plaintiffs’ reply sets forth arguments and information not pertinent to the motion and often not supported by any evidence. While the Court is mindful that Plaintiffs are self-represented, Plaintiffs’ status as parties appearing in propria persona does not provide a basis for preferential consideration. “A party proceeding in propria persona ‘is to be treated like any other party and is entitled to the same, but no greater[,] consideration than other litigants and attorneys.’” (Rappleyea v. Campbell (1994) 8 Cal.4th 975, 985.) Indeed, “‘the in propria persona litigant is held to the same restrictive rules of procedure as an attorney.’” [Citation.]” (First American Title Co. v. Mirzaian (2003) 108 Cal.App.4th 956, 958, fn. 1; see also Nwosu v. Uba (2004) 122 Cal.App.4th 1229, 1246-1247.) In accordance with the precedent established by the California Supreme Court in Rappleyea, appellate courts have held that the pleadings and motions filed by a self-representing litigant in the trial court are subject to the standards generally applied by California courts in civil litigation. (Gamet v. Blanchard (2001) 91 Cal.App.4th 1276, 1284-1285 [self-representing litigants are not exempt from statutes or court rules governing procedure].) The Court thus expects Plaintiffs papers to comply with this Court’s Guidelines for Civility in Civil Litigation. The page limitations set forth in the Code of Civil Procedure and the California Rules of Court are not an invitation for Plaintiffs to set forth any and all arguments or grievances they may have against an opposing party, especially when such arguments are not pertinent to the resolution of the issues before the Court. The parties are admonished to strictly comply with all statutes and rules that apply to this Court, including the Guidelines for Civility in Civil Litigation. The Court thus disregards the remainder of Plaintiffs’ reply not pertinent to the resolution of the motion.

    Plaintiffs move for an order staying the Court’s January 30, 2020 Order granting FATIC’s Motion for Independent Medical Examination of Plaintiffs pending the resolution of Plaintiffs’ related Motion for Protective Order of the Mental Examination Records and Other Medical Information sought by FATIC. Plaintiffs argue that a stay is necessary to safeguard and protect Plaintiffs’ right to privacy relating to the mental examinations and medical information. Plaintiffs assert that without a stay, irreparable damage will be done because FATIC will be able to disseminate Plaintiffs’ protected material to the public and third parties. Plaintiffs contend that there is no way to undo the harm resulting from the disclosure of privileged materials.

    In opposition, FATIC argues that there is no ground to stay the order pending the resolution of the protective order motion. FATIC asserts that while the parties differ substantially in their legal positions, the facts here are undisputable: the Court ordered Plaintiffs to appear for IMEs, and did not order the parties to enter into a stipulated protective order, but rather encouraged the parties to try to agree to one. FATIC contends that Plaintiffs refused to appear except on certain outrageous conditions, canceled their IMEs, and have moved for a protective order, requesting that the Court order those outrageous conditions. FATIC argues that no IMEs are currently set and none will be set until this motion and the motion for protective order are resolved. (Boswell Decl. ¶ 13.) FATIC asserts that this motion is nothing more than a fight for fight’s sake, without any practical basis whatsoever; it must be denied.

    In reply, Plaintiffs argues that their need for a stay of the January 30, 2020 order is appropriate and necessary in furtherance of justice. Plaintiffs assert that if it is denied, Plaintiffs’ right to privacy will be irreparably harmed and injured. Plaintiffs contends that nothing in FATIC’s opposition provides any basis that the relief sought by Plaintiffs is unreasonable and/or unnecessary.

    The Court finds that Plaintiffs have failed to demonstrate that the relief requested is necessary or that without it, irreparable harm will result. As noted by FATIC, and unchallenged by Plaintiffs, no IMEs are currently set and none will be set until this motion and the motion for protective order, set to be heard on July 7, 2020, are resolved. Accordingly, nothing before the Court indicates that the relief requested is necessary or that Plaintiffs will be harmed by the denial of the instant motion.

    Based on the foregoing, Plaintiffs’ motion for stay of this Court’s January 30, 2020 order is DENIED.

    Conclusion

    Plaintiffs’ motion for stay of the January 30, 2020 Order is DENIED.

    The parties are strongly encouraged to attend all scheduled hearings by telephone or CourtCall. All social distancing protocols will be observed at the Courthouse and in the courtrooms.

    Moving party to give notice.



Case Number: ****6649    Hearing Date: July 01, 2020    Dept: 31

MOTION TO COMPEL COMPLIANCE WITH DEPOSITION SUBPOENA FOR PRODUCTION OF DOCUMENTS IS DENIED

Background

Plaintiffs Cesar Romero (“Cesar”) and Tatana Romero (“Tatana”) sued Defendants First American Title Insurance Company (hereinafter “FATIC”), First American Title Company, and Prominent Escrow Services, Inc. for compensatory and injunctive relief, based on allegations that Plaintiffs’ non-party neighbor’s home improvements encroached onto Plaintiffs’ property. Plaintiffs also claim that FATIC, which provided Plaintiffs’ title insurance, acted in bad faith by improperly favoring Plaintiffs’ neighbors, “Shih/Ko,” in the dispute over the alleged encroachment and failed to pay Plaintiffs adequate damages to compensate for the diminution in value of their property caused by the encroachment. In the operative Second Amended Complaint (“SAC”), Plaintiffs assert causes of action for:

  1. Breach of Contract by Escrow Agents and Fiduciaries for Failure to Comply with Instructions;

  2. Negligence by Escrow Agents and Fiduciaries in the Performance of Their Duties;

  3. Breach of Fiduciary Duty;

  4. Damages for Negligent Representation;

  5. Damages for Fraud;

  6. Breach of Insurance Contract;

  7. Breach of the Duty of Good Faith and Fair Dealing; and

  8. Unfair Business Practices.

    The sixth, seventh, and eighth causes of action are pending against FATIC because the Court sustained FATIC’s demurrer to the first, second, third, fourth, and fifth causes of action without leave to amend on May 9, 2018. Also, as a result of sustaining the demurrer without leave to amend on May 9, 2019, Defendant First American Title Company was dismissed with prejudice, as the first through fifth causes of action were the only ones asserted against it. On January 31, 2019, Plaintiffs dismissed Defendant Prominent Escrow Services, Inc. with prejudice.

    Plaintiffs seek an order compelling third-parties Janet Humphrey (hereinafter “Humphrey”) & Songstad Randall Coffee & Humphrey’s (“Songstad”) compliance with the deposition subpoena for business records served on November 10, 2019. On January 31, 2020, pursuant to the request of Plaintiffs, the Court continued the instant matter to allow Plaintiffs to personally serve the Notice to Consumer on the Shih/Kos.

Legal Standard

A party seeking discovery from a person who is not a party to the action may obtain discovery by oral deposition, written deposition, or deposition subpoena for production of business records. (Code Civ. Proc., ; 2020.010.) A deposition subpoena may command: (1) only the attendance and testimony of the deponent, (2) only the production of business records for copying, or (3) the attendance and testimony of the deponent, as well as the production of business records, other documents, electronically stored information, and tangible things. (Code Civ. Proc., ; 2020.020.)

Service of a deposition subpoena shall be effected a sufficient time in advance of the deposition to provide the deponent a reasonable opportunity to locate and produce any designated documents and, where personal attendance is commanded, a reasonable time to travel to the place of deposition. (Code Civ. Proc., ; 2020.220, subd. (a).) Personal service of any deposition subpoena is effective to require a deponent who is a resident of California to: personally appear and testify, if the subpoena so specifies; to produce any specified documents; and to appear at a court session if the subpoena so specifies. (Code Civ. Proc., ; 2020.220, subd. (c).) A deponent who disobeys a deposition subpoena may be punished for contempt without the necessity of a prior order of the court directing compliance by the witness. (Code Civ. Proc., ; 2020.240.)

A “written notice and all moving papers supporting a motion to compel an answer to a deposition question or to compel production of a document or tangible thing from a nonparty deponent must be personally served on the nonparty deponent unless the nonparty deponent agrees to accept service by mail or electronic service at an address or electronic service address specified on the deposition record.” (Cal. Rules of Court, Rule 3.1346.)

Request for Judicial Notice

The court may take judicial notice of “official acts of the legislative, executive, and judicial departments of the United States and of any state of the United States,” “[r]ecords of (1) any court of this state or (2) any court of record of the United States or of any state of the United States,” and “[f]acts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” (Evid. Code ; 452, subds. (c), (d), and (h).) 

Songstad requests that the Court take judicial notice of the December 3, 2019 Order denying Plaintiffs’ Order to Show Cause Re: Contempt. The request is GRANTED.

Plaintiffs request that the Court take judicial notice of a number of documents filed in this case. The request is GRANTED.

Evidentiary Objections

Songstad submits objections to the Declaration of Cesar Romero. The objections are immaterial to the Court’s disposition. The Court thus declines to rule upon them.

Plaintiffs also submit objections to the Declaration of Jenna Griffin. The objections are similarly immaterial to the Court’s disposition. The Court thus declines to rule upon them.

Discussion

Plaintiffs move for an order compelling Humphrey and Songstad’s compliance with a deposition subpoena for business records served on Songstad on November 10, 2019. The Court notes at the outset that the instant motion is inappropriately targeted at Humphrey, individually, whose name does not appear on the deposition subpoena. (Romero Decl., Exh. A.) The Court cannot compel compliance with a deposition subpoena where the name of the person targeted by the subpoena enforcement proceedings is not expressly set forth on the subpoena. As to Humphrey, in effect, the subpoena does not exist. Accordingly, the Court ignores Plaintiffs’ arguments regarding Humphrey’s non-compliance and instead focuses on the arguments relating to Songstad.

The Court also notes that on April 16, 2020, Plaintiffs filed a supplemental brief in support of their motion. This supplemental brief was filed without authorization of the Court. The Court admonishes Plaintiffs and expects all parties to strictly comply with the briefing rules set forth by the CRC and CCP. The Court thus disregards Plaintiffs’ arguments in their sur-reply to the extent that they go beyond proving personal service of the Notice to Consumer on the Shih/Kos.

Additionally, on June 24, 2020, the Shih/Kos filed a Joinder to Songstad’s opposition. The Joinder is untimely pursuant to Code of Civil Procedure section 1005(b), which requires that opposition papers must be filed at least 9 court days before the hearing. The Court thus disregards the Shih/Kos’ untimely joinder.

Plaintiffs assert that on November 27, 2019, in response to the subpoena, Songstad served objections. Plaintiffs contend that Songstad has failed and refuses to comply with the subpoena. Plaintiffs argue that to date, Songstad has not produced any of the requested documents. 

Plaintiffs argue that good cause exists to grant this motion because all of the documents sought are in Songstad’s possession and relate directly to this case and to Plaintiffs’ claims that Songstad and FATIC have colluded and illegally shared Plaintiffs’ confidential information in order to jointly defeat Plaintiffs in both actions. Plaintiffs also assert none of the requested documents are privileged in any way. Plaintiffs contend that there is nothing privileged about conversations that Songstad had with Lisa Weinberg, Plaintiffs’ former counsel in this action; all the meetings and communications that Songstad had with Scott Gizer, Lisa Boswell, and/or Zach Gidding, Defendant’s attorneys of record in this action. Plaintiffs argue that there is nothing privileged about Songstad’s communications with any other third party.

The subpoena seeks the following documents:

  1. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Lisa Weinberg RELATING TO the Romero property.

  2. Any and all DOCUMENTS RELATING TO, and reflecting any and_ all COMMUNICATIONS between YOU and Lisa Weinberg RELATING TO the Shih/Ko property.

  3. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Lisa Weinberg RELATING TO the ENCROACHMENT CASE.

  4. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Lisa Weinberg RELATING TO the BAD FAITH CASE.

  5. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and The Boss Law firm RELATING TO the Romero property.

  6. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and The Boss Law firm RELATING TO the Shih/Ko property.

  7. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and The Boss Law firm RELATING TO ENCROACHMENT CASE.

  8. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and The Boss Law firm RELATING TO the BAD FAITH CASE.

  9. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and any FATIC RELATING TO the Romero property.

  10. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and any FATIC RELATING TO the Shih/Ko property.

  11. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and any FATIC RELATING’ TO ENCROACHMENT CASE.

  12. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and any FATIC RELATING TO the BAD FAITH CASE.

  13. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Early Sullivan Wright Gizer & McRae LLP RELATING TO the Romero property.

  14. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Early Sullivan Wright Gizer & McRae LLP RELATING TO the Shih/Ko property.

  15. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Early Sullivan Wright Gizer & McRae LLP RELATING TO ENCROACHMENT CASE.

  16. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Early Sullivan Wright Gizer & McRae LLP RELATING TO the BAD FAITH CASE.

  17. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and David Tsai RELATING TO the Romero property.

  18. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and David Tsai RELATING TO the Shih/Ko property.

  19. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and David Tsai RELATING TO ENCROACHMENT CASE.

  20. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and David Tsai RELATING TO the BAD FAITH CASE.

  21. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Richard Walden RELATING TO the Romero property.

  22. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Richard Walden RELATING TO the Shih/Ko property.

  23. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Richard Walden RELATING TO ENCROACHMENT CASE.

  24. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Richard Walden RELATING TO the BAD FAITH CASE.

  25. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Burris, Schoenberg & Walden, LLP RELATING TO the Romero property.

  26. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Burris, Schoenberg & Walden, LLP RELATING TO the Shih/Ko property.

  27. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Burris, Schoenberg & Walden, LLP RELATING TO ENCROACHMENT CASE.

  28. Any and all DOCUMENTS RELATING TO, and reflecting any and_ all COMMUNICATIONS between YOU and Burris, Schoenberg & Walden, LLP RELATING TO the BAD FAITH CASE.

  29. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and any other PERSON, other than Shih/Ko, RELATING TO the Romero property.

  30. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and any other PERSON, other than Shih/Ko, RELATING TO the Shih/Ko property.

  31. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and any other PERSON, other than Shih/Ko, RELATING TO ENCROACHMENT CASE.

  32. Any and all DOCUMENTS RELATING TO, and reflecting any and_ all COMMUNICATIONS between YOU and any other PERSON, other than Shih/Ko, RELATING TO the BAD FAITH CASE.

Notice to Consumer

Code of Civil Procedure section 1985.3 provides:

  1. For the purposes of this section, the following definitions apply:

(1) “Personal records” means the original, any copy of books, documents, other writings, or electronically stored information pertaining to a consumer and which are maintained by any “witness” which is a[n] . . . attorney. . .

(2) “Consumer” means any individual, partnership of five or fewer persons, association, or trust which has transacted business with, or has used the services of, the witness or for whom the witness has acted as agent or fiduciary. . . .

(b) Prior to the date called for in the subpoena duces tecum for the production of personal records, the subpoenaing party shall serve or cause to be served on the consumer whose records are being sought a copy of the subpoena duces tecum, of the affidavit supporting the issuance of the subpoena, if any, and of the notice described in subdivision (e), and proof of service as indicated in paragraph (1) of subdivision (c). This service shall be made as follows:

(1) To the consumer personally, or at his or her last known address, or in accordance with Chapter 5 (commencing with Section 1010) of Title 14 of Part 3, or, if he or she is a party, to his or her attorney of record. If the consumer is a minor, service shall be made on the minor's parent, guardian, conservator, or similar fiduciary, or if one of them cannot be located with reasonable diligence, then service shall be made on any person having the care or control of the minor or with whom the minor resides or by whom the minor is employed, and on the minor if the minor is at least 12 years of age.

(2) Not less than 10 days prior to the date for production specified in the subpoena duces tecum, plus the additional time provided by Section 1013 if service is by mail.

(3) At least five days prior to service upon the custodian of the records, plus the additional time provided by Section 1013 if service is by mail. . . . 

(k) Failure to comply with this section shall be sufficient basis for the witness to refuse to produce the personal records sought by a subpoena duces tecum.

(Code Civ. Proc., ; 1985.3(a)-(b), (k).)

Songstad first opposes the instant motion arguing that Plaintiffs have failed to serve a Notice of Consumer on the Shih/Kos, as admitted in Plaintiffs’ separate statement. Songstad argues that as a general rule, the papers and property that are accumulated by the attorney during the course of the relationship belong to the client, whether or not the attorney has been paid for his services. (Weiss v. Marcus (1975) 51 Cal.App.3d 590, 599; see California Rules of Professional Conduct Rule 3-700(D)(1) (“‘Client papers and property’ includes correspondence, pleadings, deposition transcripts, exhibits, physical evidence, expert’s reports, and other items reasonably necessary to the client’s representation, whether the client has paid for them or not”).) Songstad asserts that the documents sought by the subpoena are therefore “personal records” and the failure to serve the Notice to Consumer on the Shih/Kos is grounds alone to deny the motion.

In reply, Plaintiffs argue that a notice to consumer was not necessary because Plaintiffs did not seek consumer records within the Section 1985.3 definition of “personal records.” Citing to Sasson v. Katash ((1983) 146 Cal.App.3d 119), Plaintiffs assert that the purpose of the statutory requirement for a notice to consumer is to inform the consumer of the intended invasion of his or her privacy and to be given the opportunity to oppose it, which is not the case here. Plaintiffs contend that it was never the intent of the subpoena to seek privileged documents or documents pertaining to personal and confidential information about Shih/Ko that would invade their privacy rights protected by Section 1985.3. Plaintiffs argues that rather, the intent of the subpoena was to seek documents reflecting Songstad’s communications with third parties relating to, among other things, this bad faith action.

At the hearing on January 31, 2020, Plaintiffs requested that the Court continue the hearing in order for Plaintiffs to properly serve a Notice to Consumer on the Shih/Kos. The Court granted Plaintiffs’ request. In their unauthorized supplemental briefing, Plaintiffs attached copies of the Proofs of Service indicating personal service of the Notice to Consumer on the Shih/Kos. (Supp. Romero Decl., Exh. A-B.) Based on the evidence before the Court, the Court finds that Plaintiffs have personally served the Notice to Consumer on the Shih/Kos. The Court thus turns to Songstad’s remaining arguments.

Deposition of Opposing Counsel

Songstad first argues that Plaintiffs have not established extremely good cause for the deposition subpoena to Songstad. “Depositions of opposing counsel are presumptively improper, severely restricted, and require “extremely” good cause—a high standard. [Citations.]

There are strong policy considerations against deposing an opposing counsel. The practice runs counter to the adversarial process and to the state's public policy to “[p]revent attorneys from taking undue advantage of their adversary's industry and efforts.” [Citation.] “‘Discovery was hardly intended to enable a learned profession to perform its functions ... on wits borrowed from the adversary.’” [Citations.] . . . 

Attorney depositions chill the attorney-client relationship, impede civility and easily lend themselves to gamesmanship and abuse. “Counsel should be free to devote his or her time and efforts to preparing the client's case without fear of being interrogated by his or her opponent.” [Citation.] “[I]n the highly charged atmosphere of litigation, attorney depositions may serve as a potent tool to harass an opponent.” [Citation.]

To effectuate these policy concerns, California applies a three-prong test in considering the propriety of attorney depositions. First, does the proponent have other practicable means to obtain the information? Second, is the information crucial to the preparation of the case? Third, is the information subject to a privilege? [Citations.] 

Each of these prongs poses an independent hurdle to deposing an adversary's counsel; any one of them may be sufficient to defeat the attempted attorney deposition.

Without question, the proponent has the burden of proof to establish the predicate circumstances for the first two prongs.” (Carehouse Convalescent Hospital v. Superior Court (2006) 143 Cal.App.4th 1558, 1562–1563.)

Prongs 1 & 2

Songstad argues that Plaintiffs have not established extremely good cause for the deposition subpoena to Songstad. Songstad asserts that Plaintiffs are seeking their adversary’s litigation file when they already have a majority of the documents in their possession, having recovered them from their own attorney and through their discovery efforts in this action and the Related Action. Songstad contends Plaintiffs’ subpoena is presumptively improper and Plaintiffs have failed to show extremely good cause. Songstad argues that the subpoena is nothing more than Plaintiffs’ further attempt to annoy, harass, and distract Songstad and Humphrey from preparing for trial and force Humphrey to expend her time and resources to protect her clients.

Songstard asserts that Plaintiffs cannot meet the elements necessary to compel compliance with the subpoena because they already have obtained the information they seek, the records requested in the subpoena are not crucial to the action, and the documents are privileged. 

With regard to the first prong, Songstad argues that Plaintiffs have failed to meet their burden where they clearly have other means to obtain information other than subpoenaing records from Songstad. Songstad asserts that the discovery sought is overbroad, unreasonably cumulative, duplicative, burdensome, and harassing where Plaintiffs have already obtained the documents from other sources.

Request Nos. 1-4: Documents related to Lisa Weinberg, Plaintiffs’ former attorney in the Related Action. Songstad argues that these documents are equally available to Plaintiffs, as Plaintiffs have their litigation file from Weinberg, have subpoenaed documents, and have taken her deposition. Songstad asserts that additionally, as their attorney of record, it is reasonable to assume that Weinberg updated Plaintiffs with respect to her communications with Humphrey.

Requests Nos. 5-8: Documents related to David Boss, FATIC’s Outside Counsel who was retained to provide a coverage opinion and monitor the Related Action. Songstad contends that Plaintiffs have already obtained all non-privileged documents and deposition testimony from Boss during discovery in this action, as he has answered discovery requests and produced documents to Plaintiffs.

Requests Nos. 9-12: Documents related to FATIC. Songstad argues that Plaintiffs have already taken the deposition of numerous FATIC attorneys and representatives and have obtained documents from them, including from Elizabeth Wootton, FATIC’s Claims Counsel, who is handling the Shih/Ko matter and who retained Songstad to represent the Shih/Kos as litigation counsel in the related action; Meredith Mayosky, FATIC’s Claims Counsel, who handled the Romeros’ claim; and Lorie Hilburg, FATIC’s Outside Counsel, who was retained by FATIC to assist in resolving Plaintiff’s bad faith claim. Songstad asserts that each were specifically asked about their communications with Songstad and Humphrey and responded accordingly.

Requests Nos. 13-16: Documents related to Early Sullivan Wright Gizer & McRae LLP (“ESWGM”), attorneys of record for FATIC in this action. Songstad contends that Plaintiffs have already propounded extensive written discovery, including two sets of special interrogatories, regarding ESWGM’s communications with Songstad, and have already obtained documents and responses from ESWGM on behalf of FATIC.

Requests Nos. 17-20: Documents related to David Tsai, the Shih/Ko’s representative/agent and translator. Songstad argues that Plaintiffs subpoenaed and obtained deposition testimony of Tsai in the Related Action.

Requests Nos. 21-29: Documents related to Richard Walden and his former law firm Burris Schoenberg & Walden LLP (“Burris”), attorneys of record for the Shih/Ko’s. Songstad asserts that Plaintiffs have subpoenaed Walden’s documents from Burris. Songstad contends that moreover, surely, Plaintiffs know Walden and Burris are Shih/Ko’s counsel and that any communication between co-counsel is privileged.

Requests Nos. 29-32: Documents evidencing communications with “All Other Persons” related to the Shih/Ko Case and property. Songstad finally argues that Plaintiff’s requests are impermissibly overbroad and encompass persons protected by the attorney-client privilege, including Tsai, Wootton, Boss, Walden, consultants, witnesses, and others. Songstad asserts that based on the foregoing, Plaintiffs have other means, and have, in fact, already obtained the documents, and thus cannot establish the first prong.

As to the second prong, Songstad contends that the information sought in the subpoena is not crucial. Songstad argues that there is no non-privileged information that Songstad has that is crucial to the preparation of Plaintiffs’ case in this Action. Songstad contends that Plaintiffs do not even bother to identify any crucial information. Songstad argues that even if there was any crucial information, it has already been produced by other witnesses in this Action and the Related Action. Songstad asserts that there is no legitimate reason why Plaintiffs need the litigation file of its adversaries and seeking these records is improper. 

In reply, Plaintiffs focus on the third prong of the test, arguing that the documents sought are not privileged for various reasons. Plaintiffs assert, without legal support, that they are entitled to obtain all non-privileged documents directly from Songstad, as they relate to this action.

The Court finds that Plaintiffs have failed to carry their burden establishing extremely good cause required to compel Songstad’s compliance with the deposition subpoena. It is undisputed that Songstad is opposing counsel in the Related Action. Accordingly, the deposition subpoena is an attempt by Plaintiffs to depose opposing counsel. While Songstad is not opposing counsel in this action, the strong policy considerations against deposing opposing counsel still apply regardless because Songstad is opposing counsel in this matter or the Related Action. The number of motions that have come before the Court relating to both actions is a testament to how closely related the two actions are. 

In order for Plaintiffs to depose Songstad (and to seek the firm’s litigation file by subpoena), Plaintiffs must establish extremely good cause for taking the deposition, such that Plaintiffs are required to establish that they do not have other practicable means to obtain the information and that the information is crucial to the preparation of the case. Plaintiffs have failed to do so here. 

As pointed out by Songstad, Plaintiffs have subpoenaed the documents they request here from a number of other sources and have deposed numerous witnesses regarding the documents that are the subject of the subpoena. It cannot be said that Plaintiffs are without any other practicable means to obtain the information they seek. While it may be correct that the documents sought are not privileged, such a determination is irrelevant here where Plaintiffs clearly have other practicable means of obtaining the information sought. As noted above, each of the prongs poses an independent hurdle to deposing an adversary's counsel; any one of them may be sufficient to defeat the attempted attorney deposition. Here, Plaintiffs’ ability to obtain the information sought by other practicable means acts as a sufficient barrier to compelling compliance with the deposition subpoena served upon Songstad. 

Moreover, Plaintiffs have failed to persuade the Court that the information sought is crucial to the preparation of their case. Plaintiffs’ arguments are based on conjecture and speculation that Songstad and FATIC have colluded and illegally shared Plaintiffs’ confidential information in order to jointly defeat Plaintiffs in both actions. Plaintiffs have failed to provide any evidence of this alleged collusion and illegal acts such that the Court is persuaded that the Subpoena is merely a tool to conduct a fishing expedition and unduly harass or burden Songstad.

Based on the foregoing, Plaintiffs’ motion to compel compliance is DENIED in its entirety.

Conclusion

Plaintiffs’ motion to compel compliance is DENIED in its entirety. Moving parties are to give notice.

The parties are strongly encouraged to attend all scheduled hearings by telephone or CourtCall. All social distancing protocols will be observed at the Courthouse and in the courtrooms.

MOTION FOR PROTECTIVE ORDER AND TO QUASH DEPOSITION SUBPOENA IS GRANTED

Background

Plaintiffs Cesar Romero (“Cesar”) and Tatana Romero (“Tatana”) sued Defendants First American Title Insurance Company (hereinafter “FATIC”), First American Title Company, and Prominent Escrow Services, Inc. for compensatory and injunctive relief, based on allegations that Plaintiffs’ non-party neighbor’s home improvements encroached onto Plaintiffs’ property. Plaintiffs also claim that FATIC, which provided Plaintiffs’ title insurance, acted in bad faith by improperly favoring Plaintiffs’ neighbors, “Shih/Ko,” in the dispute over the alleged encroachment and failed to pay Plaintiffs adequate damages to compensate for the diminution in value of their property caused by the encroachment. In the operative Second Amended Complaint (“SAC”), Plaintiffs assert causes of action for:

  1. Breach of Contract by Escrow Agents and Fiduciaries for Failure to Comply with Instructions;

  2. Negligence by Escrow Agents and Fiduciaries in the Performance of Their Duties;

  3. Breach of Fiduciary Duty;

  4. Damages for Negligent Representation;

  5. Damages for Fraud;

  6. Breach of Insurance Contract;

  7. Breach of the Duty of Good Faith and Fair Dealing; and

  8. Unfair Business Practices.

    The sixth, seventh, and eighth causes of action are pending against FATIC because the Court sustained FATIC’s demurrer to the first, second, third, fourth, and fifth causes of action without leave to amend on May 9, 2018. Also, as a result of sustaining the demurrer without leave to amend on May 9, 2019, Defendant First American Title Company was dismissed with prejudice, as the first through fifth causes of action were the only ones asserted against it. On January 31, 2019, Plaintiffs dismissed Defendant Prominent Escrow Services, Inc. with prejudice.

    Third party deponent Janet E. Humphrey (“Humphrey”) moves the Court for an order imposing a protective order and quashing the Deposition Subpoena for Personal Appearance dated December 13, 2019, served by Plaintiff Cesar Romero.

    Legal Standard

    “The court, for good cause shown, may make any order that justice requires to protect any party, deponent, or other natural person or organization from unwarranted annoyance, embarrassment, or oppression, or undue burden and expense.” (Code Civ. Proc., ; 2025.420(b).) Courts have considerable discretion in granting and crafting protective orders. (Raymond Handling Concepts Corp. v. Superior Court (1995) 39 Cal.App.4th 584, 588.)

    California Code of Civil Procedure section 1987.1, subdivision (a) provides:

    If a subpoena requires the attendance of a witness or the production of books, documents, or other things before a court, or at the trial of an issue therein, or at the taking of a deposition, the court, upon motion reasonably made by any person described in subdivision (b), or upon the court's own motion after giving counsel notice and an opportunity to be heard, may make an order quashing the subpoena entirely, modifying it, or directing compliance with it upon those terms or conditions as the court shall declare, including protective orders. In addition, the court may make any other order as may be appropriate to protect the person from unreasonable or oppressive demands, including unreasonable violations of the right of privacy of the person.

    (Code of Civ. Proc., ; 1987.1(a).) There is no requirement that the motion contain a meet and confer declaration. (See Code of Civ. Proc., ; 1987.1.)

    “Unless otherwise limited by order of the court . . . any party may obtain discovery regarding any matter, not privileged, that is relevant to the subject matter involved . . . if the matter either is itself admissible in evidence or appears reasonably calculated to lead to the discovery of admissible evidence.” (Code Civ. Proc. ; 2017.010.) “Even highly relevant, nonprivileged information may be shielded from discovery if its disclosure would impair a person’s ‘inalienable right of privacy’ provided by” Article 1, section 1 of the California Constitution. (See Britt v. Sup. Ct. (San Diego Unified Port Dist.) (1978) 20 Cal.3d 844, 855-856.)

    Regarding the right of privacy, courts must carefully balance a right of privacy against the interest in having just litigation. (Pioneer Electronics (USA), Inc. v. Superior Court (2007) 40 Cal.4th 360, 371; Valley Bank of Nevada v. Sup. Ct. (1975) 15 Cal.3d 652, 657.) If there is a serious invasion of a constitutional right to privacy, the party seeking the evidence must establish that the information sought is not only essential and directly relevant, but also that this information could not be discovered through less intrusive means. (See Williams v. Superior Court (2017) 3 Cal.5th 531, 552; Allen v. Superior Court (1984) 151 Cal.App.3d 447, 449.)

    “The burden is on the party seeking the constitutionally protected information to establish direct relevance.” (Davis v. Superior Court (1992) 7 Cal.App.4th 1008, 1017.) “Mere speculation as to the possibility that some portion of the records might be relevant to some substantive issue does not suffice.” (Id.)

    Request for Judicial Notice

The court may take judicial notice of “official acts of the legislative, executive, and judicial departments of the United States and of any state of the United States,” “[r]ecords of (1) any court of this state or (2) any court of record of the United States or of any state of the United States,” and “[f]acts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” (Evid. Code ; 452, subds. (c), (d), and (h).)

Humphrey, as a part of her moving papers and reply papers, requests that the Court take judicial notice of a number of documents filed with the Court. The requests are GRANTED.

Plaintiffs also request that the Court take judicial notice of documents filed with the Court. Humphrey objects to Exhibits 1-4 on the ground that there is no evidence that the documents were filed with the Court. Humphrey further objects to Exhibit 5 on the grounds that it is incomplete and irrelevant to the issues raised by the motion.

Plaintiffs’ request for judicial notice is GRANTED as to Exhibit 1. Plaintiffs’ request as to the remaining exhibits is DENIED. The Court has no record of Exhibits 2-4 having been filed with the Court. As to Exhibit 5, the Court finds that the Exhibit is incomplete.

Evidentiary Objections

Humphrey submits a number of objects to the Declaration of Cesar Romero. The objections are immaterial to the Court’s disposition. The Court thus declines to rule upon them.

Plaintiffs submit objections to the Declaration of Jenna Griffin and the Declaration of Elyn C. Holt. Objection 2 to the Declaration of Elyn C. Holt is OVERRULED. The remaining objections are immaterial to the Court’s disposition. The Court thus declines to rule upon them.

Discussion

Humphrey, counsel of record for the Shih/Kos in the Related Action, moves for an order imposing a protective order and quashing the Deposition Subpoena for Personal Appearance dated December 13, 2019 served by Plaintiff Cesar Romero on the grounds that: (1) it is procedurally defective; (2) it is overbroad, unreasonable, oppressive, and harassing; and (3) it seeks to depose opposing counsel which is improper, severely restricted, and requires extremely good cause, which Plaintiffs cannot establish.

The Court notes at the outset that Plaintiffs again filed an unauthorized reply to FATIC’s Response to Plaintiffs’ opposition. There is no authority allowing Plaintiffs to file such a Reply. The Court strongly admonishes Plaintiffs to refrain from filing sur-reply briefs. The Court expects strict compliance with briefing requirements provided by the CRC and CCP. Based on the foregoing, the Court thus disregards Plaintiffs’ unauthorized Reply.

Service of the Subpoena

Code of Civil Procedure section 2020.220, which provides the procedures for deposition subpoenas on nonparties, states the following:

Any person may serve the subpoena by personal delivery of a copy of it as follows:

  1. If the deponent is a natural person, to that person.

  2. If the deponent is an organization, to any officer, director, custodian of records, or to any agent or employee authorized by the organization to accept service of a subpoena.

(Code of Civ. Proc., ; 2020.220(b).)

Humphrey first moves for the relief requested arguing that the subpoena is procedurally defective because Plaintiffs failed to personally serve Humphrey with the Subpoena. Humphrey also asserts that the examination topics are overbroad, not relevant, and served for the purpose of annoying and harassing Humphrey, delaying the Actions, and are harassing. Humphrey contends that the Court should quash the Subpoena in its entirety based on its procedural defects.

In opposition, Plaintiffs argue that on December 13, 2019, Plaintiffs personally served Humphrey with the deposition subpoena for personal appearance. (Plaintiffs’ RJN, Exh. 1.) Plaintiffs assert that the Proof of Service for the deposition subpoena was filed with the Court on January 21, 2020. Plaintiffs contend that additionally, the deposition subpoena relates directly to relevant topics in this litigation and Plaintiffs’ claims.

In reply, Humphrey argues that Plaintiffs admit that she was not personally served by attaching a proof of service attesting that Mary Beth Ruble, not Humphrey was served with the Subpoena. Humphrey asserts that this is not personal service on her. Humphrey contends that because she was never personally served, the Subpoena is defective and the Court should grant the instant motion.

The Court finds that the Subpoena is deficient, as Humphrey was never personally served with the Subpoena. As evidenced by the Proof of Service provided by Plaintiffs, the Subpoena was served on Mary Beth Ruble at Humphrey’s Law Firm on December 13, 2019. (Plaintiffs’ RJN, Exh. 1.) Pursuant to Section 2020.220, such service is deficient and ineffective to require Humphrey’s appearance.

Based on the foregoing, Humphrey’s motion for protective order and to quash deposition subpoena is GRANTED.

To avoid requiring another motion to be filed in the event Plaintiffs properly serve Humphrey, the Court now turns to Humphrey’s remaining arguments.

Deposition of Opposing Counsel

“Depositions of opposing counsel are presumptively improper, severely restricted, and require “extremely” good cause—a high standard. [Citations.]

There are strong policy considerations against deposing an opposing counsel. The practice runs counter to the adversarial process and to the state's public policy to “[p]revent attorneys from taking undue advantage of their adversary's industry and efforts.” [Citation.] “‘Discovery was hardly intended to enable a learned profession to perform its functions ... on wits borrowed from the adversary.’” [Citations.] . . .

Attorney depositions chill the attorney-client relationship, impede civility and easily lend themselves to gamesmanship and abuse. “Counsel should be free to devote his or her time and efforts to preparing the client's case without fear of being interrogated by his or her opponent.” [Citation.] “[I]n the highly charged atmosphere of litigation, attorney depositions may serve as a potent tool to harass an opponent.” [Citation.]

To effectuate these policy concerns, California applies a three-prong test in considering the propriety of attorney depositions. First, does the proponent have other practicable means to obtain the information? Second, is the information crucial to the preparation of the case? Third, is the information subject to a privilege? [Citations.]

Each of these prongs poses an independent hurdle to deposing an adversary's counsel; any one of them may be sufficient to defeat the attempted attorney deposition.

Without question, the proponent has the burden of proof to establish the predicate circumstances for the first two prongs.” (Carehouse Convalescent Hospital v. Superior Court (2006) 143 Cal.App.4th 1558, 1562–1563.)

The Deposition Subpoena for Personal Appearance here indicated that Humphrey would be examined on the following matters: “Any communications with Plaintiffs’ previous attorney Ms. Weinberg. Any communications with First American Title Insurance Company attorneys and/or representatives in regards to Plaintiffs. Any communications with any third party in regards to the Plaintiffs.”

Prongs 1 & 2

Humphrey argues that Plaintiffs should not be permitted to depose Humphrey, who is opposing counsel in the Related Action. Humphrey asserts that the Subpoena is nothing more than Plaintiffs’ further attempt to annoy, harass, and distract Humphrey from preparing for trial and force her to expend time and resources by having to file this Motion to prevent Plaintiffs from engaging in more harassing behavior against Humphrey and to protect her clients, the Shih/Kos.

Humphrey contends that with regard to the first prong, Plaintiffs clearly have other means to obtain information other than deposing opposing counsel, Humphrey. Humphrey argues that Plaintiffs can contact their former attorneys regarding any communications and email they have had with Humphrey. Humphrey contends that additionally, Plaintiffs can and, in fact, have completed written discovery with the pertinent information Plaintiffs are seeking though the Subpoena. Humphrey asserts that Plaintiffs have taken several depositions, including their former counsel, Lisa Weinberg, and representatives and lawyers of FATIC, including David Boss, Lore Hilburg, Meredith Mayosky, and Elizabeth Wootton. Humphrey contends that Brenda Wendt, Plaintiffs former expert appraiser was also deposed. Humphrey argues that at these depositions, the deponents were asked about and provided responses in regards to their communications with Humphrey. Humphrey asserts that Plaintiffs should not be permitted to depose Humphrey about her communications as they already have the information the Subpoena seeks.

With respect to the second prong, Humphrey contends that there is no non-privileged information that Humphrey has that is crucial to the preparation of Plaintiffs’ case in this action. Humphrey further argues that Plaintiffs do not identify any crucial information. Humphrey asserts that there is no legitimate reason Humphrey needs to be deposed, and seeking her deposition is harassing and improper.

In opposition, Plaintiffs argue that Humphrey’s argument that she is opposing counsel is fatally flawed as Humphrey is not opposing counsel in this action. Plaintiffs assert that it is an undisputed fact that Humphrey is a third party in this action. Plaintiffs contend that as such, Humphrey’s legal argument does not apply.

Plaintiffs contend that existing law does not prohibit deposition on non-privileged issues and being a lawyer is not a basis for quashing the deposition, citing to Meritplan Ins. Co. v. Superior Court ((1981) 124 Cal.App.237, 242). Plaintiffs argue that moreover, good cause exists to deny Humphrey’s motion to quash. Plaintiffs assert that they are entitled to question Humphrey about non-privileged issues and communications with third parties to fully investigate their claim and the extent of collusion between Humphrey and FATIC. Plaintiffs contend that Humphrey used confidential information from FATIC and this action to prosecute Plaintiffs in the Related Action. Plaintiffs argue that in the Related trial, Humphrey was allowed to introduce evidence and testimony from this action even though she was never a party to this action.

Plaintiffs contend that they will be severely prejudiced if they are unable to prosecute and investigate their claims, ask Humphrey questions, and investigate the level of collusion between Humphrey and FATIC in this case. Plaintiffs argue that the testimony sought relates directly to this case and to Plaintiffs’ claims, and Humphrey has direct knowledge. Plaintiffs assert that there is nothing privileged about conversations that Humphrey had with Weinberg, the meetings and communications Humphrey had with Scott Gizer, Lisa Boswell, and/or Zach Gidding, or Humphrey’s communications with any other third party.

In reply, Humphrey argues that Plaintiffs fail to meet their burden. As to the first prong, Humphrey asserts that Plaintiffs do not dispute the fact that in addition to written discovery they propounded to FATIC, they have taken several depositions. Humphrey contends that at these depositions, the deponents were asked about and provided responses in regard to their communications with Humphrey. Humprhey argues that there is therefore no reason to take the deposition of Humphrey about her communications, as Plaintiffs already have the information sought by the Subpoena.

As to the second prong, Humphrey argues that Plaintiffs fail to identify what information Humphrey has that is “crucial” to the preparation of their case. Humphrey asserts that instead, Plaintiffs simply offer speculation and insinuations of collusion between Humphrey and FATIC and/or its attorneys in this action, which this Court previously rejected as just that, speculation. (Holt Decl., Exh. 2.) Humphrey contends that Plaintiffs have failed to produce any evidence of any collusion between FATIC and Humphrey to justify the taking of Humphrey’s deposition. Humphrey argues that in the Related Action, the non-confidential evidence that Plaintiffs refer to were obtained in the public record of this action, which was admitted into evidence through the testimony of Plaintiff Cesar.

The Court finds that Plaintiffs have failed to carry their burden establishing extremely good cause required to compel Humphrey’s compliance with the deposition subpoena. It is undisputed that Humphrey is opposing counsel in the Related Action. Accordingly, the deposition subpoena is an attempt by Plaintiffs to depose opposing counsel. Although Plaintiffs argue that Humphrey is not opposing counsel in this action, the strong policy considerations against deposing opposing counsel still apply regardless of if Humphrey is opposing counsel in this matter or the Related Action. The number of motions that have come before the Court relating to both actions is a testament to how closely related the two actions are. As noted above, attorney depositions chill the attorney-client relationship, impede civility, and easily lend themselves to gamesmanship and abuse.

Thus, in order for Plaintiffs to depose Humphrey, Plaintiffs must establish extremely good cause for the deposition, such that Plaintiffs are required to establish that they do not have other practicable means to obtain the information and that the information is crucial to the preparation of the case. Plaintiffs have failed to do so here.

As pointed out by Humphrey, Plaintiffs have deposed numerous witnesses regarding the communications that Plaintiffs intend to examine Humphrey on, and have even subpoenaed documents relating to such communications from other various sources. It cannot be said that Plaintiffs are without any other practicable means to obtain the information they seek. While it may be correct that the documents sought are not privileged, such a determination is irrelevant here, where Plaintiffs clearly have other practicable means of obtaining the information sought. As noted above, each of the prongs poses an independent hurdle to deposing an adversary's counsel; any one of them may be sufficient to defeat the attempted attorney deposition. Here, Plaintiffs’ ability to obtain the information sought by other practicable means acts as a sufficient barrier to compelling compliance with the deposition subpoena served upon Humphrey.

Moreover, Plaintiffs have failed to persuade the Court that the information sought is crucial to the preparation of their case. Plaintiffs’ arguments are based solely on conjecture and speculation that Humphrey and FATIC have colluded and illegally shared Plaintiffs’ confidential information in order to jointly defeat Plaintiffs in both actions. Plaintiffs have failed to provide any evidence of this alleged collusion and illegal acts such that the Court is persuaded that the Subpoena is merely a tool to conduct a fishing expedition and unduly harass or burden Humphrey.

Based on the foregoing, Humphrey’s motion for protective order and to quash deposition subpoena is GRANTED.

Sanctions

Code of Civil Procedure section 2031.060 provides that “the court shall impose a monetary sanction under Chapter 7 (commencing with Section 2023.010) against any party, person, or attorney who unsuccessfully makes or opposes a motion for a protective order, unless it finds that the one subject to the sanction acted with substantial justification or that other circumstances make the imposition of the sanction unjust.” (Code Civ. Proc., ; 2031.060(h).)

Humphrey requests sanctions against Plaintiffs in the total amount of $4,275.00 for 10.5 hours spent preparing the moving papers, an anticipated 3 hours preparing for, traveling to, and attending the hearing on the motion billed at a rate of $250/hour, plus an additional 3 hours spent researching and reviewing the motion billed at a rate of $300/hour.

The Court finds sanctions should be awarded but the amount of sanctions requested is unreasonable as the Court is not convinced that it was reasonable for Humphrey to spend an additional 3 hours reviewing the instant motion, nor will counsel be required to attend the hearing in person. The Court thus awards reduced sanctions in the amount of $2,550.00 consisting of 8 hours spent preparing the moving papers and 1 hour preparing for and attending the hearing on the motion billed at a rate of $250/hour plus 1 hour spent researching and reviewing the motion billed at a rate of $300/hour.

Conclusion

Humphrey’s motion for protective order and to quash deposition subpoena is GRANTED. Plaintiffs are ordered to pay monetary sanctions in the amount of $2,550.00 to Janet E. Humphrey within 30 days. The Court declines Plaintiffs’ request to unseal documents previously deemed privileged.

Moving parties to give notice.

The parties are strongly encouraged to attend all scheduled hearings by telephone or CourtCall. All social distancing protocols will be observed at the Courthouse and in the courtrooms.



Case Number: ****6649    Hearing Date: June 22, 2020    Dept: 31

DEFENDANT'S MOTION TO COMPEL COMPLIANCE WTH SUBPOENA IS GRANTED, IN PART.

Background

Plaintiffs Cesar Romero (“Cesar”) and Tatana Romero (“Tatana”) sued Defendants First American Title Insurance Company (hereinafter “FATIC”), First American Title Company, and Prominent Escrow Services, Inc. for compensatory and injunctive relief, based on allegations that Plaintiffs’ non-party neighbor’s home improvements encroached onto Plaintiffs’ property. Plaintiffs also claim that FATIC, which provided Plaintiffs’ title insurance, acted in bad faith by improperly favoring Plaintiffs’ neighbors, “Shih/Ko,” in the dispute over the alleged encroachment and failed to pay Plaintiffs adequate damages to compensate for the diminution in value of their property caused by the encroachment. In the operative Second Amended Complaint (“SAC”), Plaintiffs assert causes of action for:

  1. Breach of Contract by Escrow Agents and Fiduciaries for Failure to Comply with Instructions;

  2. Negligence by Escrow Agents and Fiduciaries in the Performance of Their Duties;

  3. Breach of Fiduciary Duty;

  4. Damages for Negligent Representation;

  5. Damages for Fraud;

  6. Breach of Insurance Contract;

  7. Breach of the Duty of Good Faith and Fair Dealing; and

  8. Unfair Business Practices.

    The sixth, seventh, and eighth causes of action are pending against FATIC because the Court sustained FATIC’s demurrer to the first, second, third, fourth, and fifth causes of action without leave to amend on May 9, 2018. Also as a result of sustaining the demurrer without leave to amend on May 9, 2019, Defendant First American Title Company was dismissed with prejudice, as the first through fifth causes of action were the only ones asserted against it. On January 31, 2019, Plaintiffs dismissed Defendant Prominent Escrow Services, Inc. with prejudice.

    FATIC seeks an order compelling third-party Phillip Corrado, Ph.D. (“Corrado”) to comply with the deposition for production of business records served on August 19, 2019.

Legal Standard

A party seeking discovery from a person who is not a party to the action may obtain discovery by oral deposition, written deposition, or deposition subpoena for production of business records. (Code Civ. Proc., ; 2020.010.) A deposition subpoena may command: (1) only the attendance and testimony of the deponent, (2) only the production of business records for copying, or (3) the attendance and testimony of the deponent, as well as the production of business records, other documents, electronically stored information, and tangible things. (Code Civ. Proc., ; 2020.020.)

Service of a deposition subpoena shall be effected a sufficient time in advance of the deposition to provide the deponent a reasonable opportunity to locate and produce any designated documents and, where personal attendance is commanded, a reasonable time to travel to the place of deposition. (Code Civ. Proc., ; 2020.220, subd. (a).) Personal service of any deposition subpoena is effective to require a deponent who is a resident of California to: personally appear and testify, if the subpoena so specifies; to produce any specified documents; and to appear at a court session if the subpoena so specifies. (Code Civ. Proc., ; 2020.220, subd. (c).) A deponent who disobeys a deposition subpoena may be punished for contempt without the necessity of a prior order of the court directing compliance by the witness. (Code Civ. Proc., ; 2020.240.)

A “written notice and all moving papers supporting a motion to compel an answer to a deposition question or to compel production of a document or tangible thing from a nonparty deponent must be personally served on the nonparty deponent unless the nonparty deponent agrees to accept service by mail or electronic service at an address or electronic service address specified on the deposition record.” (Cal. Rules of Court, Rule 3.1346.)

Request for Judicial Notice

The court may take judicial notice of “official acts of the legislative, executive, and judicial departments of the United States and of any state of the United States,” “[r]ecords of (1) any court of this state or (2) any court of record of the United States or of any state of the United States,” and “[f]acts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” (Evid. Code ; 452, subds. (c), (d), and (h).)

Defendant requests that the Court take judicial notice of the facts that (1) on September 20, 2019, Reiter Dye & Brennan, LLP filed a Motion to Be Relieved as Counsel which was set to be heard on October 23, 2019; and (2) that discovery in this matter closed on December 30, 2019 as evidenced in various documents filed in this case. The request is GRANTED.

Evidentiary Objections

Plaintiffs submit a number of objections to the Declaration of Zachary A. Gidding. The objections are OVERRULED.

FATIC also submits a number of objections to the Declarations of Phillip Corrado and Cesar Romero. Objections 1 through 7 are SUSTAINED.

Discussion

The Court notes at the outset that Plaintiffs filed a supplemental brief on February 24, 2020 after being expressly admonished that no further briefing will be allowed. The Court thus disregards Plaintiffs’ supplemental brief and FATIC’s responsive brief. The parties are admonished and expected to strictly comply with all rules and orders of this Court.

FATIC seeks an order compelling third-party Philip Corrado, Ph.D. to comply with the deposition for production of business records served on August 19, 2019. (Gidding Decl., Exh. 9.) FATIC asserts that the subpoena production was due on September 6, 2019. (Gidding Decl. ¶ 8.) FATIC contends that to date, Corrado’s office has not produced and refuses to produce any documents in response to the subpoena. (Gidding Decl. ¶ 8.) FATIC argues that by letter dated October 8, 2019, which was not received by FATIC’s counsel until November 11, 2019, Corrado responded in relevant part that, because Plaintiffs “stated that they did not want me to release their records,” he “will not be able to release records” and is “asserting the privilege on [Plaintiffs’] behalf.” (Gidding Decl., Exh. 11.) FATIC asserts that Plaintiffs have not served any objections to the subpoena, nor have Plaintiffs or Corrado moved to quash the subpoena. (Gidding Decl. ¶ 8.) FATIC contends that notably, Plaintiffs have previously produced portions of Corrado’s records with redactions subject to a protective order, evidencing that at documents requested by the subpoena, in fact, exist. (Gidding Decl. ¶ 10.)

FATIC argues that to the extent required, good cause exists to compel production of the requested documents. The subpoena requests the following documents:

  1. Dr. Phillip Corrado’s curriculum vitae (“CV”).

  2. All DOCUMENTS, including all COMMUNICATIONS in whatever form, pertaining to care, treatment, and examination of Cesar Romero, including but not limited to all office, emergency room, inpatient or outpatient charts, either in hard copy or electronic form, from January 1, 2009 to the present.

  3. All DOCUMENTS, including all COMMUNICATIONS in whatever form, pertaining to care, treatment, and examination of Tatiana Romero, formerly known as Tatiana Spicakova, including but not limited to all office, emergency room, inpatient or outpatient charts, either in hard copy or electronic form, from January 1, 2009 to the present.

  4. All DOCUMENTS reflecting any records of payment and/or discount regarding any medical billing for Cesar Romero, including but not limited to the bills themselves, billing information, statements, computer printouts, itemized breakdowns of charges, or statements of balances due, including all charges, credits, payments, or adjudgments/write-offs, such as EOBs from insurance carriers (including Medicare or Medicaid) reflecting credits, adjudgments, or write-offs to the bills by virtue of payments or contractual agreements or adjustments for professional services, form January 1, 2009 to the present.

  5. All DOCUMENTS reflecting any records of payment and/or discount regarding any medical billing for Tatiana Romero, formerly known as Tatiana Spicakova, including but not limited to the bills themselves, billing information, statements, computer printouts, itemized breakdowns of charges, or statements of balances due, including all charges, credits, payments, or adjudgments/write-offs, such as EOBs from insurance carriers (including Medicare or Medicaid) reflecting credits, adjudgments, or write-offs to the bills by virtue of payments or contractual agreements or adjustments for professional services, form January 1, 2009 to the present.

  6. All COMMUNICATIONS between YOU and Cesar Romero.

  7. All COMMUNICATIONS between YOU and Tatiana Romero, formerly known as Tatiana Spicakova.

FATIC asserts that the subpoena requests information which is directly relevant to Plaintiffs’ claims here. FATIC contends that given the nature and extent of the damages Plaintiffs will claim at trial, discovery into Plaintiffs’ medical care and treatment by Corrado is not only warranted, it is required to preserve FATIC’s ability to thoroughly investigate the merits of Plaintiffs’ claims and prepare an appropriate defense.

FATIC argues that to the extent that Corrado and/or Plaintiffs claim that the subpoena is objectionable on the basis of privacy, any such claim has been waived as a matter of law pursuant to Vinson v. Superior Court ((1987) 43 Cal.3d 833). FATIC asserts that Plaintiffs have formally placed their mental conditions at issue in this action by asserting severe emotional distress claims and associated damages in their SAC, written discovery responses, and deposition testimony. (Gidding Decl., Exh. 1-2.) FATIC contends that an investigation of Plaintiffs’ past and ongoing medical care, treatment, and examination by their physician, Corrado, is the only manner in which FATIC may evaluate the merits of Plaintiffs’ claims and properly prepare its defense given the nature and extent of Plaintiffs’ damages, which will be a critical issue at trial.

FATIC finally argues that it will suffer irreparable harm if the motion is denied given the alleged ongoing and serious emotional distress claimed by Plaintiffs as a result of the events described in the SAC. FATIC asserts that on the other hand, any burden on Corrado and/or Plaintiffs of producing the requested information is clearly outweighed by the importance of allowing the requested discovery in order to promote the fair adjudication of all of the issues at trial.

Service of Subpoena

Code of Civil Procedure section 2020.220 provides in relevant part:

(a) Subject to subdivision (c) of Section 2020.410, service of a deposition subpoena shall be effected a sufficient time in advance of the deposition to provide the deponent a reasonable opportunity to locate and produce any designated business records, documents, electronically stored information, and tangible things, as described in Article 4 (commencing with Section 2020.410), and, where personal attendance is commanded, a reasonable time to travel to the place of deposition.

(b) Any person may serve the subpoena by personal delivery of a copy of it as follows:

(1) If the deponent is a natural person, to that person.

(2) If the deponent is an organization, to any officer, director, custodian of records, or to any agent or employee authorized by the organization to accept service of a subpoena.

(Code of Civ. Proc. ; 2020.220(a)-(b).)

“A waiver may occur (1) by an intentional relinquishment or (2) as ‘the result of an act which, according to its natural import, is so inconsistent with an intent to enforce the right as to induce a reasonable belief that such right has been relinquished.’ [Citation.]” (Crest Catering Co. v. Superior Court of Los Angeles County (1965) 62 Cal.2d 274, 278.)

Corrado and Plaintiffs first oppose the instant motion arguing that the subpoena was not properly served, as it was not personally served. Corrado and Plaintiffs assert that Corrado is the only person authorized to accept the subpoena for medical records for his office and his patients. (Corrado Decl. ¶ 3, 8.) Corrado and Plaintiffs contend that FATIC failed to personally serve Corrado and thus the subpoena is fatally defective. (Corrado Decl. ¶ 5, 8.)

In reply, FATIC argues that Corrado and Plaintiffs are estopped from asserting improper service. FATIC asserts that Corrado did not respond to the subpoena in a timely manner, nor did he or Plaintiffs serve any timely objections or motions to quash. FATIC contends that when Corrado did respond, he did not mention any service issue at all. FATIC argues that by failing to assert any purported defect in service at any time between the service of the first subpoena in March 2019 and the instant opposition in January 2020, and instead directing FATIC in November 2019 to proceed by motion, Corrado caused FATIC to forbear from serving him before the discovery cutoff in December 2019 and now seeks to take advantage of that forbearance.

FATIC asserts that in the alternative, Corrado and Plaintiffs waived their objections to the service of the subpoena. FATIC contends that here, Corrado knew he had not been personally served, as he stated in his letter that the subpoena had been served on his office. FATIC argues that rather than state that he would not comply with the subpoena because he believed it had not been properly served, instead he stated that he would comply with the subpoena so long as Plaintiffs’ counsel authorized him to do so, or a court ordered him to do so. FATIC asserts that Corrado’s apparent agreement to comply with the subpoena if he was told to either by his clients or the Court is completely inconsistent with an intent to assert a service objection.

FATIC contends that there is no dispute that Plaintiffs’ counsel, when meeting and conferring on the subpoena did not raise any issue about service, and instead proposed that Corrado execute an affidavit stating that Plaintiffs’ production was complete. FATIC argues that Plaintiffs were copied on the November 8, 2019 letter, which included the affidavit of service, but did not raise the service issue then either. FATIC asserts it relied on Corrado and Plaintiffs’ conduct and forbore re-serving Corrado. FATIC contends that now that discovery has closed and the prejudice to it is irreparable, Corrado and Plaintiffs have waived and are estopped from asserting the service issue.

The Court finds that Corrado and Plaintiffs have waived their objections to the service of the subpoena. The failure to assert the objection to the service of the subpoena or to move to quash the subpoena on the grounds of improper service at any time prior to the close of discovery estops Corrado and Plaintiffs from asserting such an objection now. Had Corrado or Plaintiffs objected to the method of service prior to the close of discovery, FATIC could have corrected the service issue and personally served Corrado. Absent such an objection FATIC was deprived of its ability to correct service of the subpoena. Corrado and Plaintiffs’ delayed objection cannot now be used to oppose the instant motion.

Based on the foregoing, the Court now turns to Plaintiffs’ other arguments.

The August 23, 2019 Protective Order & Duplicative Documents

In opposition, Plaintiffs also argue that on August 23, 2019, the Court signed a stipulated protective order. Plaintiffs assert that the protective order was entered into following the service of a Notice to Consumer wherein FATIC sought all of Plaintiffs’ medical records, medical bills, insurance statements, and communications spanning the last 10 years. (Romero Decl., Exh. 5.) Plaintiffs contend that following a meet and confer regarding the subpoena, FATIC and Plaintiffs entered into an agreement and stipulated that Plaintiffs will produce the medical records relevant to this suit. Plaintiffs argue that the stipulation was subject to a protective order, which restricted the medical records to those “relating to damage claims made by Plaintiffs for emotional distress,” rather than the initial overbroad request. Plaintiffs assert that following the entry of the protective order, Plaintiffs subsequently produced records relating to their emotional distress claim on August 29, 2019. (Romero Decl., Exh. 2.) Plaintiffs contend that FATIC did not object at any time to the records provided to them. Plaintiffs argue that the protective order rendered FATIC’s subpoena moot.

Plaintiffs assert that additionally, FATIC violated the protective order and refused to accept Corrado’s affidavit authenticating the medical records. Plaintiffs argue that despite the existing protective order, on or about October 9, 2019, FATIC informed Plaintiffs’ former counsel that “[a]s for Corrado, we issued a subpoena(s) to his office . . . We are looking for production of Corrado’s subpoenaed records directly from Corrado’s office with an executed declaration from the custodian of records as opposed to a response and/or production from your office.” (Romero Decl., Exh. 7.) Plaintiffs contend that on or about October 22, 2019, Plaintiffs’ former counsel offered to provide an affidavit directly from Corrado, who is the custodian of records, authenticating the records produced by Plaintiffs. (Romero Decl., Exh. 3.) Plaintiffs argue that such affidavit would have provided the executed declaration from the custodian of records that FATIC supposedly desired in the first place.

Plaintiffs assert that FATIC refused to accept Corrado’s affidavit and instead accused Plaintiffs of being problematic and unreasonable. (Romero Decl., Exh. 4.) Plaintiffs contend that the documents that are the subject of the instant subpoena are the very same records that Plaintiffs’ previous attorney already provided to FATIC. Plaintiffs argue that the concurrently filed opposition and declaration from Corrado authenticates the medical records previously produced to FATIC. (Corrado Decl. ¶ 12.) Plaintiffs assert that the medical records that Corrado has identified are the exact same records that were already produced to FATIC. Plaintiffs contend that it is therefore undisputed that FATIC has been in possession of Plaintiffs’ medical records all along but it made it its mission to continue to harass Plaintiffs.

In reply, FATIC argues that it did not violate the stipulation and protective order in any way. FATIC asserts that the protective order did not require FATIC to withdraw its subpoena and FATIC never did so. FATIC contends that the protective order imposes no requirement that FATIC accept any affidavit in lieu of documents. (Romero Decl., Exh. 1.) FATIC argues that there is no indication that Corrado was ever aware of this offer of an affidavit at the time it was made. FATIC asserts that at no time had Corrado certified that the production was complete, nor has FATIC ever received unredacted versions of the documents produced.

FATIC contends that Plaintiffs do not dispute that the production they made in August 2019 was redacted, and Corrado does not even certify that the redacted production was complete, nor does he explain why he did not review the production before now. FATIC argues that Plaintiffs’ claim that FATIC did not object at any time to Plaintiffs and/or to Plaintiffs’ prior attorney about the medical records provided to it is belied by the October 22, 2019 emails between the parties wherein FATIC’s counsel noted that the records were out of date and redacted for “private information unrelated to Dr. Corrado’s medical analysis.” (Romero Decl., Exh. 3-4.) FATIC asserts that given Plaintiffs’ history of refusing to honor agreements made by their counsel, it was reasonable for FATIC to seek the records directly from Corrado. FATIC contends that it is entitled to all records within the scope of discovery and need not appoint Plaintiffs the gatekeepers of what records FATIC can receive, particularly when a protective order is already in place governing those records. FATIC argues that if, once produced, Plaintiffs believe that any of the records sought should not be admissible at trial, the proper mode of challenging their use is by a motion in limine.

The Court finds that FATIC has not violated the August 23, 2019 protective order and that such order did not require FATIC to withdraw its subpoena. Additionally, nothing before the Court indicates that all the documents requested by the subpoena have been produced. The Court thus finds that the August 23, 2019 protective order did not render the subject subpoena moot.

Based on the foregoing, the Court turns to Plaintiffs’ arguments regarding the breadth of the subpoena.

Breadth of the Subpoena

Plaintiffs argue that the subpoena is impermissibly overbroad under California law. Plaintiffs assert that the subpoena requests all of Plaintiffs’ medical records, medical bills, insurance statements, and communications spanning the last 10 years. Plaintiffs contend that its overbreadth was the basis for entering into the stipulation and protective order in the first place. Plaintiffs contend that the mere allegation of emotional distress does not automatically strip Plaintiffs of the right to privacy with respect to their medical records, medical bills, or insurance information. Plaintiffs argue that FATIC is therefore not entitled to Plaintiffs’ entire medical and personal history over the last 10 years just because Plaintiffs filed a lawsuit alleging, among other things, a garden variety emotional distress as a result of FATIC’s wrongdoing.

Plaintiffs assert that moreover, FATIC will not be prejudiced and/or suffer any harm if the instant motion is denied as FATIC already is in possession of the medical records sought. Plaintiffs contend that they have not withheld any documents, FATIC was able to question Plaintiffs about their medical claims during their lengthy depositions, and FATIC propounded several sets of discovery with a multitude of questions, all of which FATIC admits to having.

In reply, FATIC argues that Plaintiffs’ overbreadth objection is untimely and meritless. FATIC asserts that all of the documents requested relate directly to the issues in this case. FATIC contends that to the extent that the time period of records requests is lengthy, this is justified because of the need to evaluate Plaintiffs’ emotional state in the pre-lawsuit period, if such records exist, as this would bear on whether any conduct of FATIC could have caused Plaintiffs’ emotional distress. FATIC argues that Plaintiffs’ exaggerated claims that FATIC is seeking “their entire medical and personal history” is belied by the subpoena; FATIC is simply asking for the records of the psychologist Plaintiffs themselves identified in discovery, including the billings that they identify as damages.

FATIC asserts that Plaintiffs claim emotional distress from FATIC’s conduct and FATIC needs the records of the distress to prepare an appropriate defense. FATIC contends that the Court cannot assume that the Plaintiffs’ production, which is redacted, is all there is, particularly considering Corrado has not said so. FATIC argues that if Corrado has nothing more than what was already produced, then granting the motion will impose no great burden. FATIC asserts that however, if documents have been withheld, FATIC will be deprived of the benefit of them in deposing Corrado and preparing for trial. FATIC contends that the Court cannot and should not accept Plaintiffs’ assessment of whether their adversary, FATIC, has everything it needs to defend against their claims.

The Court finds that as currently phrased, the subpoena is overbroad. The Court agrees with FATIC that Corrado’s records pertaining to care, treatment, and examination of Plaintiffs, including charts and billings, are directly relevant to this action to the extent that the subpoena requests records related to Plaintiffs’ treatment with Corrado since the events giving rise to this action took place and even for a brief time period before that. However, FATIC has failed to justify its request for records dating all the way back to 2009. While the Court agrees that Plaintiffs’ psychological state prior to 2015 is relevant to determining whether Plaintiffs’ emotional distress is the result of FATIC’s alleged conduct, FATIC has failed to justify its request for records dating back to 6 years prior to the alleged misconduct. The Court thus finds that records dating back to 1 year prior to the alleged events giving rise to this action should be produced.

Additionally, FATIC has failed to justify the request for all communications between Plaintiffs and Corrado. The Court finds that such a request is overbroad and not reasonably calculated to lead to the discovery of admissible evidence. The Court finds that Corrado’s records, including his charts and billings, pertaining to care, treatment, and examination of Plaintiffs will provide FATIC with the information necessary to defend against Plaintiffs’ claims. FATIC has failed to make a showing of the necessity of all communications between Plaintiffs and Corrado.

Based on the foregoing, FATIC’s motion to compel compliance with deposition subpoena for production of business records is GRANTED, in part. Corrado is ordered to produce documents responsive to Request Nos. 1-5 dating back to January 2014.

Sanctions

Code of Civil Procedure section 2023.030 provides:

The court may impose 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. . . . If a monetary sanction is authorized by any provision of this title, the court shall impose that sanction unless it finds that the one subject to the sanction acted with substantial justification or that other circumstances make the imposition of the sanction unjust.

(Code of Civ. Proc. ; 2023.030(a).)

FATIC requests sanctions against Plaintiffs in the amount of $3,635.00 consisting of 8 hours spent preparing the moving papers, an anticipated 2 hours reviewing the opposition and preparing a reply, and 3 hours preparing for, traveling to, and attending the hearing at a rate of $275 per hour plus the $60 filing fee. FATIC asserts that the imposition of sanctions is necessary and warranted because there is no evidence to suggest that Plaintiffs acted with substantial justification in Plaintiffs’ instruction to Corrado to not produce the records, and there are no circumstances that make the imposition of the sanction unjust.

The Court finds that given the overbreadth nature of the subpoena both in scope and subject matter, Plaintiffs acted with substantial justification in instructing Corrado not produce records responsive to the subpoena. Accordingly, the Court finds that the imposition of sanctions in this instance would be unjust.

Conclusion

FATIC’s motion to compel compliance with deposition subpoena for production of business records is GRANTED pursuant to the restrictions noted above. FATIC’s request for sanctions is DENIED.

The parties are strongly encouraged to attend all scheduled hearings by telephone. All social distancing protocols will be observed.

Moving party to give notice.



Case Number: ****6649    Hearing Date: January 31, 2020    Dept: 31

MOTION TO COMPEL COMPLIANCE WITH DEPOSITION SUBPOENA IS DENIED.

Background

Plaintiffs Cesar Romero (“Cesar”) and Tatana Romero (“Tatana”) sued Defendants First American Title Insurance Company (hereinafter “FATIC”), First American Title Company, and Prominent Escrow Services, Inc. for compensatory and injunctive relief, based on allegations that Plaintiffs’ non-party neighbor’s home improvements encroached onto Plaintiffs’ property. Plaintiffs also claim that FATIC, which provided Plaintiffs’ title insurance, acted in bad faith by improperly favoring Plaintiffs’ neighbors, “Shih/Ko,” in the dispute over the alleged encroachment and failed to pay Plaintiffs adequate damages to compensate for the diminution in value of their property caused by the encroachment. In the operative Second Amended Complaint (“SAC”), Plaintiffs assert causes of action for:

  1. Breach of Contract by Escrow Agents and Fiduciaries for Failure to Comply with Instructions;

  2. Negligence by Escrow Agents and Fiduciaries in the Performance of Their Duties;

  3. Breach of Fiduciary Duty;

  4. Damages for Negligent Representation;

  5. Damages for Fraud;

  6. Breach of Insurance Contract;

  7. Breach of the Duty of Good Faith and Fair Dealing; and

  8. Unfair Business Practices.

    The sixth, seventh, and eighth causes of action are pending against FATIC because the Court sustained FATIC’s demurrer to the first, second, third, fourth, and fifth causes of action without leave to amend on May 9, 2018. Also as a result of sustaining the demurrer without leave to amend on May 9, 2019, Defendant First American Title Company was dismissed with prejudice, as the first through fifth causes of action were the only ones asserted against it. On January 31, 2019, Plaintiffs dismissed Defendant Prominent Escrow Services, Inc. with prejudice.

    Plaintiffs seek an order compelling third-parties Janet Humphrey (hereinafter “Humphrey”) & Songstad Randall Coffee & Humphrey’s (“Songstad”) compliance with the deposition subpoena for business records served on November 10, 2019. 

Legal Standard

A party seeking discovery from a person who is not a party to the action may obtain discovery by oral deposition, written deposition, or deposition subpoena for production of business records. (Code Civ. Proc., ; 2020.010.) A deposition subpoena may command: (1) only the attendance and testimony of the deponent, (2) only the production of business records for copying, or (3) the attendance and testimony of the deponent, as well as the production of business records, other documents, electronically stored information, and tangible things. (Code Civ. Proc., ; 2020.020.)

Service of a deposition subpoena shall be effected a sufficient time in advance of the deposition to provide the deponent a reasonable opportunity to locate and produce any designated documents and, where personal attendance is commanded, a reasonable time to travel to the place of deposition. (Code Civ. Proc., ; 2020.220, subd. (a).) Personal service of any deposition subpoena is effective to require a deponent who is a resident of California to: personally appear and testify, if the subpoena so specifies; to produce any specified documents; and to appear at a court session if the subpoena so specifies. (Code Civ. Proc., ; 2020.220, subd. (c).) A deponent who disobeys a deposition subpoena may be punished for contempt without the necessity of a prior order of the court directing compliance by the witness. (Code Civ. Proc., ; 2020.240.)

A “written notice and all moving papers supporting a motion to compel an answer to a deposition question or to compel production of a document or tangible thing from a nonparty deponent must be personally served on the nonparty deponent unless the nonparty deponent agrees to accept service by mail or electronic service at an address or electronic service address specified on the deposition record.” (Cal. Rules of Court, Rule 3.1346.)

Request for Judicial Notice

The court may take judicial notice of “official acts of the legislative, executive, and judicial departments of the United States and of any state of the United States,” “[r]ecords of (1) any court of this state or (2) any court of record of the United States or of any state of the United States,” and “[f]acts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” (Evid. Code ; 452, subds. (c), (d), and (h).) 

Songstad requests that the Court take judicial notice of the December 3, 2019 Order denying Plaintiffs’ Order to Show Cause Re: Contempt. The request is GRANTED.

Plaintiffs request that the Court take judicial notice of a number of documents filed in this case. The request is GRANTED.

Evidentiary Objections

Songstad submits objections to the Declaration of Cesar Romero. The objections are immaterial to the Court’s disposition. The Court thus declines to rule upon them.

Plaintiffs also submit objections to the Declaration of Jenna Griffin. The objections are similarly immaterial to the Court’s disposition. The Court thus declines to rule upon them.

Discussion

Plaintiffs move for an order compelling Humphrey and Songstad’s compliance with a deposition subpoena for business records served on Songstad on November 10, 2019. The Court notes at the outset that the instant motion is inappropriately targeted at Humphrey, individually, whose name does not appear on the deposition subpoena. (Romero Decl., Exh. A.) The Court cannot compel compliance with a deposition subpoena that does not exist. Accordingly, the Court ignores Plaintiffs’ arguments regarding Humphrey’s non-compliance and instead focuses on the arguments relating to Songstad.

Plaintiffs assert that on November 27, 2019, in response to the subpoena, Songstad served objections. Plaintiffs contend that Songstad has failed and refuses to comply with the subpoena. Plaintiffs argue that to date, Songstad has not produced any of the requested documents. 

Plaintiffs argue that good cause exists to grant this motion because of all of the documents sought are in Songstad’s possession and relate directly to this case and Plaintiffs’ claims that Songstad and Defendant have colluded and illegally shared Plaintiffs’ confidential information in order to jointly defeat Plaintiffs in both actions. Plaintiffs assert that moreover, none of the requested documents are privileged in any way, shape, or form. Plaintiffs contend that there is nothing privileged about conversations that Songstad had with Lisa Weinberg, Plaintiffs’ former counsel in this action; all the meetings and communications that Songstad had with Scott Gizer, Lisa Boswell, and/or Zach Gidding, Defendant’s attorneys of record in this action. Plaintiffs argue that there is nothing privileged about Songstad’s communications with any other third party.

The subpoena seeks the following documents:

  1. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Lisa Weinberg RELATING TO the Romero property.

  2. Any and all DOCUMENTS RELATING TO, and reflecting any and_ all COMMUNICATIONS between YOU and Lisa Weinberg RELATING TO the Shih/Ko property.

  3. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Lisa Weinberg RELATING TO the ENCROACHMENT CASE.

  4. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Lisa Weinberg RELATING TO the BAD FAITH CASE.

  5. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and The Boss Law firm RELATING TO the Romero property.

  6. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and The Boss Law firm RELATING TO the bt Shih/Ko property.

  7. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and The Boss Law firm RELATING TO ENCROACHMENT CASE.

  8. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and The Boss Law firm RELATING TO the BAD FAITH CASE.

  9. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and any FATIC RELATING TO the Romero property.

  10. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and any FATIC RELATING TO the Shih/Ko property.

  11. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and any FATIC RELATING’ TO ENCROACHMENT CASE.

  12. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and any FATIC RELATING TO the BAD FAITH CASE.

  13. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Early Sullivan Wright Gizer & McRae LLP RELATING TO the Romero property.

  14. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Early Sullivan Wright Gizer & McRae LLP RELATING TO the Shih/Ko property.

  15. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Early Sullivan Wright Gizer & McRae LLP RELATING TO ENCROACHMENT CASE.

  16. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Early Sullivan Wright Gizer & McRae LLP RELATING TO the BAD FAITH CASE.

  17. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and David Tsai RELATING TO the Romero property.

  18. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and David Tsai RELATING TO the Shih/Ko property.

  19. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and David Tsai RELATING TO ENCROACHMENT CASE.

  20. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and David Tsai RELATING TO the BAD FAITH CASE.

  21. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Richard Walden RELATING TO the Romero property.

  22. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Richard Walden RELATING TO the Shih/Ko property.

  23. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Richard Walden RELATING TO ENCROACHMENT CASE.

  24. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Richard Walden RELATING TO the BAD FAITH CASE.

  25. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Burris, Schoenberg & Walden, LLP RELATING TO the Romero property.

  26. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Burris, Schoenberg & Walden, LLP RELATING TO the Shih/Ko property.

  27. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and Burris, Schoenberg & Walden, LLP RELATING TO ENCROACHMENT CASE.

  28. Any and all DOCUMENTS RELATING TO, and reflecting any and_ all COMMUNICATIONS between YOU and Burris, Schoenberg & Walden, LLP RELATING TO the BAD FAITH CASE.

  29. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and any other PERSON, other than Shih/Ko, RELATING TO the Romero property.

  30. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and any other PERSON, other than Shih/Ko, RELATING TO the Shih/Ko property.

  31. Any and all DOCUMENTS RELATING TO, and reflecting any and all COMMUNICATIONS between YOU and any other PERSON, other than Shih/Ko, RELATING TO ENCROACHMENT CASE.

  32. Any and all DOCUMENTS RELATING TO, and reflecting any and_ all COMMUNICATIONS between YOU and any other PERSON, other than Shih/Ko, RELATING TO the BAD FAITH CASE.

Notice to Consumer

Code of Civil Procedure section 1985.3 provides:

  1. For the purposes of this section, the following definitions apply:

(1) “Personal records” means the original, any copy of books, documents, other writings, or electronically stored information pertaining to a consumer and which are maintained by any “witness” which is a[n] . . . attorney. . .

(2) “Consumer” means any individual, partnership of five or fewer persons, association, or trust which has transacted business with, or has used the services of, the witness or for whom the witness has acted as agent or fiduciary. . . .

(b) Prior to the date called for in the subpoena duces tecum for the production of personal records, the subpoenaing party shall serve or cause to be served on the consumer whose records are being sought a copy of the subpoena duces tecum, of the affidavit supporting the issuance of the subpoena, if any, and of the notice described in subdivision (e), and proof of service as indicated in paragraph (1) of subdivision (c). This service shall be made as follows:

(1) To the consumer personally, or at his or her last known address, or in accordance with Chapter 5 (commencing with Section 1010) of Title 14 of Part 3, or, if he or she is a party, to his or her attorney of record. If the consumer is a minor, service shall be made on the minor's parent, guardian, conservator, or similar fiduciary, or if one of them cannot be located with reasonable diligence, then service shall be made on any person having the care or control of the minor or with whom the minor resides or by whom the minor is employed, and on the minor if the minor is at least 12 years of age.

(2) Not less than 10 days prior to the date for production specified in the subpoena duces tecum, plus the additional time provided by Section 1013 if service is by mail.

(3) At least five days prior to service upon the custodian of the records, plus the additional time provided by Section 1013 if service is by mail. . . . 

(k) Failure to comply with this section shall be sufficient basis for the witness to refuse to produce the personal records sought by a subpoena duces tecum.

(Code Civ. Proc., ; 1985.3(a)-(b), (k).)

Songstad first opposes the instant motion arguing that Plaintiffs have failed to serve a Notice of Consumer on the Shih/Kos, as admitted in Plaintiffs’ separate statement. Songstad argues that as a general rule, the papers and property that are accumulated by the attorney during the course of the relationship belong to the client, whether or not the attorney has been paid for his services. (Weiss v. Marcus (1975) 51 Cal.App.3d 590, 599; see California Rules of Professional Conduct Rule 3-700(D)(1) (“‘Client papers and property’ includes correspondence, pleadings, deposition transcripts, exhibits, physical evidence, expert’s reports, and other items reasonably necessary to the client’s representation, whether the client has paid for them or not”).) Songstad asserts that the documents sought by the subpoena are therefore “personal records” and the failure to serve the Notice to Consumer on the Shih/Kos is grounds alone to deny the motion.

In reply, Plaintiffs argue that a notice to consumer was not necessary because Plaintiffs did not seek consumer records within the Section 1985.3 definition of “personal records.” Citing to Sasson v. Katash ((1983) 146 Cal.App.3d 119), Plaintiffs assert that the purpose of the statutory requirement for a notice to consumer is to inform the consumer of the intended invasion of his or her privacy and to be given the opportunity to oppose it, which is not the case here. Plaintiffs contend that it was never the intent of the subpoena to seek privileged documents or documents pertaining to personal and confidential information about Shih/Ko that would invade their privacy rights protected by Section 1985.3. Plaintiffs argues that rather, the intent of the subpoena was to seek documents reflecting Songstad’s communications with third parties relating to, among other things, this bad faith action.

Plaintiffs assert that even if the Court were to agree with Songstad that some of the requested documents may fall within the meaning of “personal records,” it does not automatically invalidate the entire subpoena and does not absolve Songstad from the legal obligation to comply with the subpoena relating to all other non-personal records. Plaintiffs contend that Songstad unilaterally decided without providing any factual support that all documents are “personal records” in order to evade its obligation, which is improper. 

Plaintiffs argue that moreover, Songstad and Richard Walden, the Shih/Kos personal counsel, are assisting Shih/Ko in evading service of the subpoena. Plaintiffs assert that Humphrey was served with the subpoena and could have very easily accepted service on behalf of the Shih/Kos and filed a Protective Order if the Shih/Kos objected to the subpoena. Plaintiffs contend that it appears that the Shih/Kos are not objecting to the subpoena and that Songstad is merely concerned with a technicality which they are exploiting because the Shih/Kos live in China.

The Court finds that Plaintiffs have failed to personally serve a Notice to Consumer on the Shih/Kos, as conceded in their Separate Statement, and that such a failure to personally serve the Notice is adequate grounds for Songstad’s refusal to produce the documents sought by the subpoena. Plaintiffs argument that the subpoena does not seek “personal records” as defined by Section 1985.3 is unpersuasive, as the Rules of Professional Conduct make clear that any items “reasonably necessary to the client’s representation” is the property of the client. It is undisputed here that the records sought by the subpoena concern communications with third parties by Songstad as counsel for Shih/Ko. Accordingly, such documents are the Shih/Kos’ “personal records” maintained by Songstad as Shih/Kos’ attorney.

Plaintiffs’ assertion that Songstad and Walden are assisting the Shih/Kos in evading service of the subpoena is unsupported by evidence and is mere speculation. Moreover, neither Songstad or Walden are required to accept service on behalf of their clients when the Shih/Kos are within their right to seek personal service of the Notice to Consumer. Here, the Shih/Kos are not a party to the instant litigation. Accordingly, pursuant to Section 1985.3(b)(1), Plaintiffs may not serve their counsel but must serve the Shih/Kos personally.

Based on the foregoing, Plaintiffs’ motion to compel compliance with the deposition subpoena for business records served on Songstad Randall Coffee & Humphrey is DENIED in its entirety.



Case Number: ****6649    Hearing Date: January 30, 2020    Dept: 31

MOTION FOR AN INDEPENDENT MENTAL EXAMINATION OF PLAINTIFFS IS GRANTED.

Background

Plaintiffs Cesar Romero (“Cesar”) and Tatiana Romero sued Defendants First American Title Insurance Company (hereinafter “FATIC”), First American Title Company, and Prominent Escrow Services, Inc. for compensatory and injunctive relief, based on allegations that Plaintiffs’ non-party neighbor’s home improvements encroached onto Plaintiffs’ property. Plaintiffs also claim that FATIC, which provided Plaintiffs’ title insurance, acted in bad faith by improperly favoring Plaintiffs’ neighbors, “Shih/Ko,” in the dispute over the alleged encroachment and failed to pay Plaintiffs adequate damages to compensate for the diminution in value of their property caused by the encroachment. In the operative Second Amended Complaint (“SAC”), Plaintiffs assert causes of action for:

  1. Breach of Contract by Escrow Agents and Fiduciaries for Failure to Comply with Instructions;

  2. Negligence by Escrow Agents and Fiduciaries in the Performance of Their Duties;

  3. Breach of Fiduciary Duty;

  4. Damages for Negligent Representation;

  5. Damages for Fraud;

  6. Breach of Insurance Contract;

  7. Breach of the Duty of Good Faith and Fair Dealing; and

  8. Unfair Business Practices.

    The sixth, seventh, and eighth causes of action are pending against FATIC because the Court sustained FATIC’s demurrer to the first, second, third, fourth, and fifth causes of action without leave to amend on May 9, 2018. Also, as a result of sustaining the demurrer without leave to amend on May 9, 2019, Defendant First American Title Company was dismissed with prejudice, as the first through fifth causes of action were the only ones asserted against it. On January 31, 2019, Plaintiffs dismissed Defendant Prominent Escrow Services, Inc. with prejudice.

    Defendant moves for an order compelling the mental examinations of Plaintiffs.

Legal Standard

California Code of Civil Procedure section 2032.310 provides that a party shall obtain leave of court if the party desires to obtain discovery by a mental examination. (See Code Civ. Proc. ; 2032.310(a).) Such leave may be granted only upon a showing of “good cause.” (Id.

Request for Judicial Notice

The court may take judicial notice of “official acts of the legislative, executive, and judicial departments of the United States and of any state of the United States,” “[r]ecords of (1) any court of this state or (2) any court of record of the United States or of any state of the United States,” and “[f]acts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” (Evid. Code ; 452, subds. (c), (d), and (h).) 

Defendant requests that the Court take judicial notice of the SAC filed in this case on January 29, 2018. The request is GRANTED.

Evidentiary Objections

Plaintiffs submit a number of objections to the Declaration of Lisa Boswell. The objections are OVERRULED. 

Plaintiffs also submit objections to the Declaration of Suzanne Dupee and Zach Gidding. The objections are OVERRULED.

Defendant submits objections to the Declarations of Cesar Romero and Tatiana Romero and the letter from Philip Corrado, Ph.D. The objections are immaterial to the Court’s disposition of the motion. The Court therefore declines to rule upon them.

Discussion

Procedural Requirements

The motion must specify the time, place, manner, conditions, scope, and nature of the examination. (Code Civ. Proc. ; 2032.310(b).) The motion must also specify the identity and specialty of the person who will be performing the examination. (Id.) A meet and confer declaration must also accompany the motion. (Id.)

Defendant’s motion complies with the procedural requirements of Section 2032.310, indicating that the examinations will take place at the office of psychiatrist Suzanne Dupee, M.D., located at 1148 Manhattan Avenue, Suite 9, Manhattan Beach, California 90266, within 30 days of the hearing of this motion. Dr. Dupee is a licensed clinical psychiatrist and board certified by the American Board of Psychiatry and Neurology including a subspecialty in forensic psychiatry. The examination will take between three to four hours, excluding psychological testing, which can take an additional two to four hours. (Boswell Decl., Exh. 12.) No other person may be present in the room during the evaluation. (Toyota Motor Sales, U.S.A., Inc. v. Superior Court of Los Angeles County (2010) 189 Cal.App.4th 1391, 1396.)

The examination will consist of “taking a very detailed history of the plaintiff using a medical/psychiatric history taking model, i.e., history of presenting problems/issues, past medical history, past psychiatric history, review of systems, substance abuse history, personal history, educational history, employment history, forensic/legal history and conducting a mental status examination.” (Boswell Decl., Exh. 12.) The psychological testing depends on the case history, however, Dr. Dupee “always conduct[s] an MMPI-2 (Minnesota Multiphasic Personality Inventory-2) or MMPI-2-RF (a shorter version), Personality Assessment Inventory (PAI) and the Mini Mental State Examination (MMSE).” (Boswell Decl., Exh. 12.) Further tests might include the Trauma Symptom Inventory-2 (TSI-2). (Boswell Decl., Exh. 12.) If further psychological testing is requested, Dr. Dupee works with several psychologists on the case. (Boswell Decl., Exh. 12.)

Defendant asserts that it initiated a meet and confer with Plaintiffs’ former counsel on August 29, 2019, seeking a stipulation to submit to mental health examinations without the need for a court order. (Boswell Decl. ¶ 6.) Defendant contends that since that time, Defendant has met and conferred directly with Plaintiffs in their pro per status regarding Defendant’s need for the mental examinations of Plaintiffs. (Boswell Decl. ¶ 7.) Defendant argues that its subsequent meet and confer efforts with Plaintiffs, including an offer to stipulate to the confidentiality of said exams, have been unsuccessful. (Boswell Decl. ¶ 12.)

Good Cause

A Court Order for physical or mental examination must be based on a showing of “good cause.” (Code Civ. Proc., ; 2032.320(a).) This generally requires a showing of both relevancy to the subject matter and specific facts justifying discovery; i.e., allegations showing the need for the information sought and lack of means for obtaining it elsewhere. (Lee Smalley Edmon & Curtis E.A. Karnow, California Practice Guide: Civil Procedure Before Trial (The Rutter Group 2018), ¶ 8:1557.) “While a plaintiff may place his mental state in controversy by a general allegation of severe emotional distress, the opposing party may not require him to undergo psychiatric testing solely on the basis of speculation that something of interest may surface.” (Vinson v. Superior Court (1987) 43 Cal.3d 833, 840.)

Defendant argues that good cause exists for Dr. Dupee’s exam. Defendant asserts that Plaintiffs have formally placed their mental conditions at issue in this action by asserting severe emotional distress claims and associated damages in their SAC, written discovery responses, and deposition testimony, including those associated with their continuing treatment with Philip Corrado, Ph.D. in this action. (SAC ¶ 111, 113, 187; Boswell Decl., Exh. 2.) Defendant contends that Plaintiffs’ claims include continued “sleep disturbances, anxiety, depression, tension, lack of appetite, and gastrointestinal discomforts and indigestion” and the inability to “start a family in their dream house, leading to further great depression and anxiety.” (Id.; Boswell Decl., Exh. 3.) Defendant argues that an investigation of Plaintiffs’ mental and cognitive potential is the only manner in which Defendant may evaluate the merits of Plaintiffs’ claims and properly prepare its defense given that the nature and extent of Plaintiffs’ damages will be a critical issue at trial.

Defendant further asserts that it will suffer irreparable harm if the motion is not granted. Defendant contends that it has no viable alternative for obtaining the discovery sought by this motion and if the motion is denied, it will be extremely prejudiced as its experts would not be able to adequately provide opinions regarding Plaintiffs’ injuries and claimed damages. Defendant argues that its experts should be given the same opportunity to evaluate Plaintiffs as Plaintiffs’ physicians have had in rendering their opinions. Defendant asserts that without this examination, it will be deprived of a fair trial.

In opposition, Plaintiffs argue that the Court previously dismissed a cause of action for emotional distress due to insufficient allegations of severe emotional distress, rending any mental examination unjustified. Plaintiffs assert that since this Court previously decided that Plaintiffs have only suffered garden variety emotional distress this is not severe in nature, the motion to compel must be denied.

Plaintiffs also contend that Defendant has failed to establish specific facts justifying the need for the mental examinations. Plaintiffs assert that Plaintiffs’ cognitive potential is not at issue in this action and any kind of evaluation of Plaintiffs’ cognitive function should be barred. Plaintiffs contend that, additionally, Defendant is already in possession of the information it seeks, which became available to them through other means, as Defendant has propounded hundreds of interrogatories, has conducted a lengthy deposition of Plaintiffs where they questioned Plaintiffs about the impact of Defendant’s conduct on Plaintiffs’ lives, and has been provided Plaintiffs’ medical records from Dr. Corrado. Plaintiffs finally argue that they have not retained a mental health expert to give any opinion testimony because Plaintiffs’ cause of action for intentional infliction of emotional distress was thrown out by the Court.

In reply, Defendant argues that Plaintiffs’ claims for emotional distress survived the demurrer that Plaintiffs point to and are recited in the general allegations of their SAC and in their surviving seventh cause of action for breach of the duty of good faith and fair dealing. Defendant asserts that the allegations and discovery responses make clear that Plaintiffs’ emotional distress claims are in controversy, ongoing, and anything but garden variety. Defendant further contends that Plaintiffs have actively treated with a psychologist, Philip Corrado, Ph.D., for their injuries, are seeking the costs of his treatment as damages, and have designated him as a non-retained expert. (Gidding Decl., ¶ 2.)

Defendant additionally submits Dr. Corrado’s records which Defendant contends reflect the full extent of Plaintiffs’ emotional distress claims. Defendant argues that unless Plaintiffs stipulate to waive their claims for emotional distress and any associated damages including waiving their right to offer any testimony or other evidence on these issues at trial, then the mental examinations must go forward.

The Court finds that good cause exists in this case as Plaintiffs have alleged emotional distress and associated damages in their SAC, written discovery responses, and deposition testimony. (SAC ¶ 111, 113, 187; Boswell Decl., Exh. 2, Exh. 3.) Contrary to Plaintiffs’ arguments, while Plaintiffs’ cause of action for intentional infliction of emotional distress was dismissed on demurrer, Plaintiffs’ claims of emotional distress in connection with the seventh cause of action for breach of the duty of good faith and fair dealing survived. Moreover, the medical records provided by Defendant clearly indicate that Plaintiffs are claiming emotional distress beyond that of the garden variety. Here, as in Vinson v. Superior Court (1987) 43 Cal.3d 833, 839-40, good cause exists for a mental examination: “In the case at bar, plaintiff haled defendants into court and accused them of causing her various mental and emotional ailments. Defendants deny her charges. As a result, the existence and extent of her mental injuries is indubitably in dispute.” “Plaintiff's present mental and emotional condition is directly relevant to her claim and essential to a fair resolution of her suit; she has waived her right to privacy in this respect by alleging continuing mental ailments.” (Id. at 842.) Consistent with this authority, the Court finds there is ample good cause for a mental examination in this case.

Burden and Intrusion Upon Plaintiffs

“The court shall limit the scope of discovery if it determines that the burden, expense, or intrusiveness of that discovery clearly outweighs the likelihood that the information sought will lead to the discovery of admissible evidence.” (Code of Civil Procedure ; 2017.020.)

Plaintiffs argue that even if good cause exists, it is outweighed by the burden and intrusion upon Plaintiffs. Plaintiffs assert that the proposed scope is overbroad, improper, and violates Plaintiffs’ constitutional right to privacy. Plaintiffs contend that a motor function evaluation, a cognitive function evaluation, and memory function evaluation are all tests completely outside the scope of and irrelevant to this lawsuit, as Plaintiffs have never alleged any loss of motor function, cognitive function, or memory in any causes of action. Plaintiffs argue that their own therapist does not believe that a mental exam is warranted in this circumstance and that Plaintiffs’ mental health is not actually in controversy.

Plaintiffs assert that Defendant’s mental examination demand has no limitations in place with regards to scope of the examination and contend that should the Court feel inclined to grant the motion, it must impose strict time limitations as well as strict privacy limitations. Plaintiff requests that the Court limit the duration of the examination to 1 to 2 hours maximum; limit the scope and nature of the examination to only issues raised by Plaintiffs and relevant to this litigation; explicitly prohibit the examiner from audio taping the examination; explicitly prohibit the examiner from asking or taking Plaintiffs’ medical or clinical history; explicitly prohibit the examiner from asking fact-finding questions; allow Plaintiffs attend together as a couple; require Defendant to produce a record or report of the examination to be delivered to Plaintiffs within 10 days of the examination; and require Defendant to enter into a productive order with Plaintiffs to prevent dissemination to any third parties and to include a significant financial penalty of one million dollars ($1,000,000.00) or more if, or when, Defendant breaks the protective order.

In reply, Defendant argues that the scope and nature of the examinations sought are not overbroad. Defendant asserts that the Declaration of Suzanne Dupee provides more detail as to the scope of the contemplated mental examinations including the reason why all the tests are not identified in advance. (Dupee Decl., ¶ 6-14.) Defendant contends that while Plaintiffs take issue with the scope and relevancy of the exams, including cognitive, motor, and memory functioning aspects, Dr. Dupee is a licensed clinical psychiatrist and board certified by the American Board of Psychiatry and Neurology, including a subspecialty in forensic psychiatry. Defendant argues that her written protocol makes clear that “[t]he psychological testing battery depends on the case history.” It is clear that Dr. Dupee will hone the scope of the examination based upon her background, training, and experience once she has taken Plaintiffs’ history. Defendant contends that the scope of the written protocol and the motion are sufficiently broad to permit Dr. Dupee to conduct the examination in conformity with accepted psychiatric standards once she has conducted the history portion of the examination.

Defendant argues that Dr. Corrado is not competent to offer any opinions relevant to this motion nor are Plaintiffs. As to the restrictions requested by Plaintiffs, including a joint examination, a 1-2 hour maximum, and a bar on audio taping, Defendant asserts that there is no legal or factual cause to place restrictions on the mental examinations. Defendant contends that as to Plaintiffs’ request to bar audio taping, Section 2032.530(a) specifically provides that “[t]he examiner and examinee shall have the right to record a mental examination by audio technology.”

As to Plaintiffs’ request for a joint examination, Defendant argues that Dr. Dupee’s declaration provides insight into how medical examinations are administered as well as why the results would be compromised if done in the presence of someone else such as an attorney or spouse. (Dupee Decl. ¶ 6-14.) Quoting Toyota Motor Sales (supra, 189 Cal.App.4th at 1396-1397), Defendant argues that “‘[s]urely the presence and participation of counsel [in a mental examination] would hinder the establishment of the rapport that is so necessary in a psychiatric examination.’ [Citation.] . . . Absent evidence to the contrary . . ., it must be presumed that the examiners will act appropriately.” Defendant asserts that here, Plaintiffs are not only husband and wife, but representing themselves pro per. Defendant contends that as such, the same hinderance effect discussed in Toyota would apply to an examination in which both Plaintiffs are present as with the examinee’s attorney.

As to Plaintiffs’ proposed time constraints, Defendant argues that aside from being their stated preference, Plaintiffs have failed to demonstrate a legitimate need to reduce the examination time to 1-2 hours. Defendant asserts that the mental examinations should therefore be ordered in conformity with Dr. Dupee’s written protocol without a preset time limit.

The Court finds that Defendant’s showing of good cause is not outweighed by any purported burden or intrusion upon Plaintiffs. Based on the record before the Court, it is clear that despite Plaintiffs’ arguments otherwise, the proposed examinations are entirely within the scope of the SAC’s allegations and Plaintiffs’ discovery responses and deposition testimony. Moreover, nothing before the Court indicates that Dr. Dupee would not act appropriately and expeditiously in administering the tests and examinations indicated. Plaintiffs have not provided adequate support for the requested limitations on the medical examinations, the request to attend a joint examination, or their request for an order requiring Defendant to enter into a protective order that would include a financial penalty of $1,000,000.00.

Based on the foregoing, Defendant’s motion to compel the independent mental examinations of Plaintiffs is GRANTED. The examinations shall be conducted individually as to each Plaintiff, and no one else can be in the room during the examination other than the Plaintiff subject to the examination. Each examination cannot exceed more than 8 hours, excluding breaks. The Court declines Plaintiffs’ request to impose monetary sanctions. The Court encourages the parties to agree to a reasonable protective order to safeguard the information which may be gleaned from the subject examinations.

Defendant First American Title Insurance Company’s Motion to Compel Compliance with Deposition Subpoena for Production of Documents is CONTINUED to Friday, March 6, 2020 at 8:30 am. 

MOTION TO COMPEL FURTHER RESPONSES TO SPECIAL INTERROGATORIES IS GRANTED.

Background

Plaintiffs Cesar Romero (“Cesar”) and Tatana Romero (“Tatana”) sued Defendants First American Title Insurance Company (hereinafter “FATIC”), First American Title Company, and Prominent Escrow Services, Inc. for compensatory and injunctive relief, based on allegations that Plaintiffs’ non-party neighbor’s home improvements encroached onto Plaintiffs’ property. Plaintiffs also claim that FATIC, which provided Plaintiffs’ title insurance, acted in bad faith by improperly favoring Plaintiffs’ neighbors, “Shih/Ko,” in the dispute over the alleged encroachment and failed to pay Plaintiffs adequate damages to compensate for the diminution in value of their property caused by the encroachment. In the operative Second Amended Complaint (“SAC”), Plaintiffs assert causes of action for:

  1. Breach of Contract by Escrow Agents and Fiduciaries for Failure to Comply with Instructions;

  2. Negligence by Escrow Agents and Fiduciaries in the Performance of Their Duties;

  3. Breach of Fiduciary Duty;

  4. Damages for Negligent Representation;

  5. Damages for Fraud;

  6. Breach of Insurance Contract;

  7. Breach of the Duty of Good Faith and Fair Dealing; and

  8. Unfair Business Practices.

    The sixth, seventh, and eighth causes of action are pending against FATIC because the Court sustained FATIC’s demurrer to the first, second, third, fourth, and fifth causes of action without leave to amend on May 9, 2018. Also, as a result of sustaining the demurrer without leave to amend on May 9, 2019, Defendant First American Title Company was dismissed with prejudice, as the first through fifth causes of action were the only ones asserted against it. On January 31, 2019, Plaintiffs dismissed Defendant Prominent Escrow Services, Inc. with prejudice.

    Defendant moves for an order compelling Plaintiffs to provide further responses to Special Interrogatories, Set Four, Nos. 28-34 propounded on Plaintiff Cesar and Special Interrogatories, Set Three, Nos. 25-31 propounded on Plaintiff Tatana.

    Legal Standard

    A motion to compel further responses to form or specially prepared interrogatories may be brought if the responses contain: (1) answers that are evasive or incomplete; (2) an unwarranted or insufficiently specific exercise of an option to produce documents in lieu of a substantive response; or (3) unmerited or overly generalized objections. (Code Civ. Proc., ; 2030.300(a).)

    Motions to compel further responses must always be accompanied by a meet-and confer-declaration (Code Civ. Proc., ; 2016.040) demonstrating a “reasonable and good faith attempt an informal resolution of each issue presented by the motion.” (Id., ;; 2030.300(b), 2031.310(b)(2), 2033.290(b).) They must also be accompanied by a separate statement containing the requests and the responses, verbatim, as well as reasons why a further response is warranted. (Cal. Rules of Court, rule 3.1345(a).) The separate statement must also be complete in itself; no extrinsic materials may be incorporated by reference. (Id., rule 3.1345(c).)

    Request for Judicial Notice

The court may take judicial notice of “official acts of the legislative, executive, and judicial departments of the United States and of any state of the United States,” “[r]ecords of (1) any court of this state or (2) any court of record of the United States or of any state of the United States,” and “[f]acts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” (Evid. Code ; 452, subds. (c), (d), and (h).) 

Evidentiary Objections

Defendant also submits a number of objections to the Declarations of Cesar Romero and Tatana Romero. The objections are immaterial to the Court’s disposition. The Court therefore declines to rule upon them.

Discussion

Defendant argues that Plaintiffs have and continue to claim that they have suffered and continue to suffer severe emotional distress due to the amount of legal fees they have paid to litigate this case and the related case as a result of Defendant’s conduct. Defendant asserts that Plaintiffs claims include damages “by having to pay out of pocket attorney fees, expenses and costs associated with the Encroaching Area Litigation” and “the constant worry and financial ruin” cause a whole assortment of medical conditions. (SAC ¶ 63, 111.) Defendant contends that Plaintiffs specifically claim that “[t]his vexatious litigation has caused, and continues to cause, the Romeros severe financial stress in addition to humiliation, emotional stress and anxiety . . . [T]he constant worry and financial ruin . . . continues to cause the Romeros to suffer from, among other things, sleep disturbances, anxiety, depression, tension, lack of appetite, and gastrointestinal discomforts and indigestion.” (SAC ¶ 111.) Defendant argues that Plaintiffs further allege that they have “exhausted all of their life savings and were forced to incur astronomical debts . . . to pay for attorney fees and litigation costs out of pocket” while they “constantly worry about money, [and] about their inability to pay for attorney fees.” (SAC ¶ 112.) Defendant asserts that finally, Plaintiffs allege that “with all of their life savings gone and debts that are astronomical, the Romeros have been unable to start a family in their dream house, leading to further great depression and anxiety. (SAC ¶ 113.)

Defendant asserts that despite this information being clearly discoverable and relevant, Plaintiffs have failed to disclose the actual figure. (Boswell Decl. ¶ 4-6, Exh. 2-3.) Defendant contends that Plaintiffs failed to provide proper substantive responses to any of the interrogatories at issue here. Defendant argues that in response to the interrogatories, Plaintiffs provided information on the amounts “incurred” and not the amounts the Plaintiffs have actually paid. (Boswell Decl. ¶ 4, Exh. 2.)

Interrogatory Nos. 25-26

Special Interrogatory No. 25 to Plaintiff Tatana and No. 28 to Plaintiff Cesar states:

Please state the amount of attorney fees YOU have paid any attorney, law firm, or other entity to litigate the SHIH/KO ACTION up to and including the date YOU serve YOUR responses to these interrogatories, including the name of each attorney, law firm, or other entity to whom YOU paid such fees.

Special Interrogatory No. 26 to Plaintiff Tatana and No. 29 to Plaintiff Cesar states:

Please state the amount of attorney fees YOU paid an attorney, law firm, or other entity to litigate the SHIH/KO ACTION up to and including March 23, 2017, including the name of and amount paid to each attorney, law firm or other entity to whom YOU paid such fees.

In response, Plaintiffs object to the interrogatories on the grounds of attorney-client privilege, Plaintiff’s right to privacy, and that the information sought is not relevant to the subject matter of this case or reasonably calculated to lead to the discovery of admissible evidence. Without waiting the objections, Plaintiffs respond stating that the “fees and charges are included in the invoices from the relevant attorneys which have been produced to FIRST AMERICAN.” Plaintiffs further respond that based on current information, “Plaintiffs believe that they have incurred the following legal fees and charges with respect to the SHIH/KO ACTION:

  1. Law Office of Richard Samuel Price

    Invoice Dates Fees Costs/Expenses Total

    8/1/15-10/1/15 $4,592.50 $23.25 $4,615.85

  2. Gaines & Stacey, LLP

    Invoice Dates Fees Costs/Expenses Total

3/1/16-5/3/17 $110,607.10 $6,524.17 $117,131.27

(Does not offset amounts paid by FIRST AMERICAN.)

  1. Goodkin Law Group

    Invoice Dates Fees Costs/Expenses Total

6/15/17-11/15/18 $54,794.75 $2,195.40 $56,990.15

  1. Golding & Lamothe

    Invoice Dates Fees Costs/Expenses Total

02/2019-10/2/2019 $55,252.00 $2,489.48 $57,741.48

It is anticipated additional amounts will be incurred as the SHIH/KO ACTION is not yet resolved.”

Interrogatory Nos. 27-29

Special Interrogatory No. 27 to Plaintiff Tatana and No. 30 to Plaintiff Cesar states:

Please state the net amount of attorney fees YOU paid to litigate the SHIH/KO ACTION up to and including the date YOU serve YOUR responses to these interrogatories, after deducting the total payments YOU received from FIRST AMERICAN.

Special Interrogatory No. 28 to Plaintiff Tatana and No. 31 to Plaintiff Cesar states:

Please state the amount of expenses YOU paid to litigate the SHIH/KO ACTION up to and including the date YOU serve YOUR responses to these interrogatories.

Special Interrogatory No. 29 to Plaintiff Tatana and No. 32 to Plaintiff Cesar states:

Please state the net amount of expenses YOU paid to litigate the SHIH/KO ACTION up to and including the date YOU serve YOUR responses to these interrogatories, after deducting the total payments YOU received from FIRST AMERICAN.

In response to Interrogatory No. 27, Plaintiffs assert the same objections as above and further refer Defendant to the response to Special Interrogatory No. 25. Plaintiffs additionally state that without waiving objections, “[b]ased on the current information, FIRST AMERICAN paid $54,775.80 which included fees and charges of Gaines & Stacey and for Mr. Gribin ($2,350.00) and the resulting calculation of all fees and charges should be adjusted accordingly. It is anticipated additional amounts will be incurred as the SHIH/KO ACTION is not yet resolved.”

In response to Interrogatory Nos. 28 and 29, Plaintiffs again assert their objections and further respond, stating “costs and expenses are included in the invoices from the relevant attorneys have been produced to FIRST AMERICAN. FIRST AMERICAN reimbursed $2,350 for expenses incurred from Mr. Gribin. In addition, based on current information Plaintiffs have also incurred separate expenses of $19,982.50. It is anticipated additional amounts will be incurred as the SHIH/KO ACTION is not yet resolved.”

Interrogatory Nos. 30-31

Special Interrogatory No. 30 to Plaintiff Tatana and No. 33 to Plaintiff Cesar states:

Please state the amount of attorney fees YOU paid any attorney, law firm, or other entity to litigate the ROMERO ACTION up to and including the date YOU serve YOUR responses to these interrogatories, including the name of each attorney, law firm, or other entity to whom YOU paid such fees.

Special Interrogatory No. 31 to Plaintiff Tatana and No. 34 to Plaintiff Cesar states:

Please state the amount of expenses YOU paid to litigate the ROMERO ACTION up to and including the date YOU serve YOUR responses to these interrogatories.

In response to Interrogatory No. 30, Plaintiffs assert the same objection as above and without waiving objections, Plaintiffs respond that “fees and charges are included in the invoices from the relevant attorneys which have been produced to FIRST AMERICAN. Based on current information, Plaintiffs believe they have incurred the following legal fees, costs and expenses with respect to the ROMERO ACTION:

  1. Buchalter, a Professional Corporation

Invoice Dates Fees Costs/Expenses Total

8/31/17-1/31/18 $110,7699.00 $3.1350.40 $113,884.40

  1. Reiter, Dye & Brennan, LLP

Invoice Dates Fees Costs/Expenses Total

6/30/18-10/10/19 $499,805.00 $23,306.58 $533,612.53

It is anticipated additional amounts will be incurred as the ROMERO ACTION is not yet resolved.”

In response to Interrogatory No. 31, Plaintiffs again object on the same grounds as previous interrogatories and incorporate by reference the response to Interrogatory No. 30. Plaintiffs further respond that “[c]osts and expenses are included in the invoices from the relevant attorneys which have been produced to FIRST AMERICAN. In addition, Plaintiffs have also incurred separate expenses of $37,521.79. It is anticipated additional amounts will be incurred as the ROMERO ACTION is not yet resolved.”

Defendants argue that these interrogatories are a simple inquiry into exactly how much money Plaintiffs have spent on litigation. Defendants assert that either Plaintiffs have paid a certain sum for their legal bills or they have not. Defendants contend that Plaintiffs failed to substantively answer the Special Interrogatories by either using improper objections or answer the questions as to the amount of attorney fees “incurred” but not “paid.” As to Plaintiffs’ objection based on the attorney-client privilege, Defendant argues that such an objection is not applicable. Quoting Los Angeles County Board of Supervisors v. Superior Court (ACLU of Southern California) ((2016) 2 Cal.5th 282, 295), Defendants assert that the California Supreme Court held, “Invoices for legal services are generally not communicated for the purpose of legal consultation. Rather, they are communicated for the purpose of billing the client and, to the extent they have no other purpose or effect, they fall outside the scope of an attorney's professional representation. [Citations.] While invoices may convey some very general information about the process through which a client obtains legal advice, their purpose is to ensure proper payment for services rendered, not to seek or deliver the attorney's legal advice or representation.”

In opposition, Plaintiffs argue that it is an undisputed fact that Plaintiffs have already provided the information sought by the instant motion through redacted copies of attorney invoices. Plaintiffs assert that although Defendant claims that there are only “some” payments reflected in the bills, the fact is that Plaintiffs have produced all available legal bills and all of the attorney bills reflect billed amounts and payment amounts. Plaintiffs contend that pursuant to Section 2030.230, Plaintiffs, as a matter of law, are not required to do the requested clerical work of adding up all the different amounts for different time periods in order to help Defendant prepare for trial.

Plaintiffs argue that moreover, Plaintiffs are entitled to recover “incurred” fees, costs and expenses under California law and Defendant’s own title insurance policy. Plaintiffs assert that accordingly, it is irrelevant what amounts were paid. Plaintiffs contend that Defendant’s argument that the amounts paid are a direct measure of Plaintiffs’ emotional distress is absurd and nonsensical.

In reply, Defendant argues that it is entitled to know the dollar amount Plaintiffs have actually paid to their attorneys, as opposed to the fees “incurred” which may have been unpaid or waived. Defendant asserts that despite Plaintiffs’ claims to the contrary, the documents produced to Defendant do not state the amount of attorneys’ fees paid by Plaintiffs to date. Defendant contends that by only providing answers to the amounts “incurred” and not the amounts “paid,” Plaintiffs’ answers are not complete and code-compliant. Defendant asserts that if Plaintiffs believe that the amount of attorneys’ fees paid to date once disclosed should not be admissible at trial, the appropriate means of addressing that issue is a motion in limine.

Defendant contends that despite Plaintiffs’ assertion that they produced all available legal bills that list both the amounts billed and the amounts paid, it is clear they have not as the redacted bills filed with Plaintiffs’ opposition only reflect payments of $234,507.61, a mere fraction of the $1 million plus amount Plaintiffs claim to have incurred. Defendant argues that the last legal bill included in the exhibits attached to Plaintiffs’ opposition and in the last document production received by Defendant was dated July 26, 2019. Defendant asserts that as a result, there is an utter lack of information as to what attorney fees have been paid since July 26, 2019. Defendant contends that Plaintiff’s argument regarding under Section 2030.230 must also fail as the records are not equally available to both parties.

The Court finds that good cause exists to compel further responses to the special interrogatories at issue and that Defendant is entitled to know the amount of attorney fees paid by Plaintiffs. Plaintiffs argument that they are not required to calculate the exact amounts for Defendant is unavailing, as Plaintiffs have frequently claimed legal fees in excess of $1 million yet the bills presented to the Court do not indicate that sum. Accordingly, Defendant would be unable to calculate the fees paid, as Plaintiffs have access to records that Defendant does not. Moreover, based on the bills before the Court, it is unclear that even if Plaintiffs had produced all available legal bills, Defendant would be capable of calculating how much has been paid to date.

Special Interrogatories, Set Four, Nos. 28-34 propounded on Plaintiff Cesar and Special Interrogatories, Set Three, Nos. 25-31 propounded on Plaintiff Tatana is GRANTED.

Sanctions

Pursuant to Section 2030.300(d), “The court shall impose a monetary sanction under Chapter 7 (commencing with Section 2023.010) against any party, person, or attorney who unsuccessfully makes or opposes a motion to compel a further response to interrogatories, unless it finds that the one subject to the sanction acted with substantial justification or that other circumstances make the imposition of the sanction unjust.”

Defendant seeks monetary sanctions against Plaintiffs in the amount of $2,810.00 consisting of 4 hours spent preparing the moving papers, an anticipated 3 hours reviewing the opposition and drafting a reply, and 3 hours preparing for, traveling to, and appearing at the hearing billed at a rate of $275 per hour plus the $60 filing fee.

The Court finds that Plaintiffs did not act with substantial justification in refusing to provide code-complaint answers to the special interrogatories at issue here or that other circumstances would make the imposition of the sanction unjust. Still, the Court finds that the amount of fees requested is excessive and therefore unreasonable. The Court thus awards reduced sanctions in the amount of $1,160.00 consisting of 2 hours preparing the moving papers, 1 hour preparing the reply, and 1 hour attending the hearing on the motion billed at a rate of $275, plus the $60 filing fee.

Conclusion

Defendant’s motion to compel further responses to Special Interrogatories, Set Four, Nos. 28-34 propounded on Plaintiff Cesar and Special Interrogatories, Set Three, Nos. 25-31 propounded on Plaintiff Tatana is GRANTED. Plaintiffs shall provide information of actual attorneys' fees and costs paid in each of the 2 actions and for each lawyer or law firm for two (2) time periods:  (1) All fees and costs paid up to March 23, 2017; (2) All fees and costs paid from March 24, 2017 to December 31, 2019. Plaintiffs must serve verified supplemental responses within thirty (30) days.

 

 



Case Number: ****6649    Hearing Date: December 30, 2019    Dept: 31

MOTION TO DISQUALIFY IS DENIED.

Background

Plaintiffs Cesar Romero (“Cesar”) and Tatiana Romero sued Defendants First American Title Insurance Company (hereinafter “FATIC”), First American Title Company, and Prominent Escrow Services, Inc. for compensatory and injunctive relief, based on allegations that Plaintiffs’ non-party neighbor’s home improvements encroached onto Plaintiffs’ property. Plaintiffs also claim that FATIC, which provided Plaintiffs’ title insurance, acted in bad faith by improperly favoring Plaintiffs’ neighbors, “Shih/Ko,” in the dispute over the alleged encroachment and failed to pay Plaintiffs adequate damages to compensate for the diminution in value of their property caused by the encroachment. In the operative Second Amended Complaint (“SAC”), Plaintiffs assert causes of action for:

  1. Breach of Contract by Escrow Agents and Fiduciaries for Failure to Comply with Instructions;

  2. Negligence by Escrow Agents and Fiduciaries in the Performance of Their Duties;

  3. Breach of Fiduciary Duty;

  4. Damages for Negligent Representation;

  5. Damages for Fraud;

  6. Breach of Insurance Contract;

  7. Breach of the Duty of Good Faith and Fair Dealing; and

  8. Unfair Business Practices.

    The sixth, seventh, and eighth causes of action are pending against FATIC because the Court sustained FATIC’s demurrer to the first, second, third, fourth, and fifth causes of action without leave to amend on May 9, 2018. Also as a result of sustaining the demurrer without leave to amend on May 9, 2019, Defendant First American Title Company was dismissed with prejudice, as the first through fifth causes of action were the only ones asserted against it. On January 31, 2019, Plaintiffs dismissed Defendant Prominent Escrow Services, Inc. with prejudice.

    Plaintiffs move for an order (1) disqualifying Early Sullivan Wright Gizer & McRae LLP (“Early Sullivan”) from further representing Defendant in this action; and (2) for issue sanctions.

    Legal Standard for Motion to Disqualify

    California Code of Civil Procedure section 128(a)(5) authorizes the Court to control in furtherance of justice, the conduct of its ministerial officers, and of all other persons in any manner connected with a judicial proceeding before it. This authority necessarily includes disqualifying an attorney. (People ex. rel. Dept. of Corporations v. SpeeDee Oil Change Systems, Inc. (1999) Cal. 4th 1135, 1145.) The issue of disqualification ultimately involves a conflict between the clients’ right to counsel of their choice and the need to maintain ethical standards of professional responsibility. (Id.) However, the paramount concern must be the preservation of public trust in the scrupulous administration of justice and the integrity of the bar and the recognized and important right to counsel of one’s choosing must yield to considerations of ethics that run to the very integrity of our judicial process. (Id.)

    In ruling on a motion to disqualify, the court should weigh: (1) the party's right to counsel of choice; (2) the attorney's interest in representing a client; (3) the financial burden on a client of change of counsel; (4) any tactical abuse underlying a disqualification motion; and (5) the principal that the fair resolution of disputes requires vigorous representation of parties by independent counsel. (Mills Land & Water Co. v. Golden West Refining Co. (1986) 186 Cal.App.3d 116, 126.) Whether an attorney should be disqualified is a matter addressed to the sound discretion of the trial court. (Henriksen v. Great American Savings & Loan (1992) 11 Cal.App.4th 109, 113.) In exercising that discretion, the trial court is required to make a reasoned judgment which complies with the legal principles and policies applicable to the issue at hand. (Id.)

    Legal Standard for Motion for Sanctions

    “The court may . . . 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.” (CCP ; 2023.030(b).) “Discovery sanctions must be tailored in order to remedy the offending party's discovery abuse, should not give the aggrieved party more than what it is entitled to, and should not be used to punish the offending party.” (Karlsson v. Ford Motor Co. (2006) 140 Cal.App.4th 1202, 1217.)

    “The discovery statutes evince an incremental approach to discovery sanctions, starting with monetary sanctions and ending with the ultimate sanction of termination. Discovery sanctions should be appropriate to the dereliction, and should not exceed that which is required to protect the interests of the party entitled to but denied discovery. If a lesser sanction fails to curb misuse, a greater sanction is warranted: continuing misuses of the discovery process warrant incrementally harsher sanctions until the sanction is reached that will curb the abuse. A decision to order terminating sanctions should not be made lightly. But where a violation is willful, preceded by a history of abuse, and the evidence shows that less severe sanctions would not produce compliance with the discovery rules, the trial court is justified in imposing the ultimate sanction.” (Doppes v. Bentley Motors, Inc. (2009) 174 Cal.App.4th 967, 992 (internal citation omitted).)

    A motion for issue or evidentiary sanctions must be accompanied by a separate statement. (Cal. Rules of Court, Rule 3.1345(a)(7).) “A separate statement is a separate document filed and served with the discovery motion that provides all the information necessary to understand each discovery request and all the responses to it that are at issue. The separate statement must be full and complete so that no person is required to review any other document in order to determine the full request and the full response. Material must not be incorporated into the separate statement by reference.” (Cal. Rules of Court, Rule 3.1345(c).)

    Request for Judicial Notice

The court may take judicial notice of “official acts of the legislative, executive, and judicial departments of the United States and of any state of the United States,” “[r]ecords of (1) any court of this state or (2) any court of record of the United States or of any state of the United States,” and “[f]acts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” (Evid. Code ; 452, subds. (c), (d), and (h).)

Defendant requests that the Court take judicial notice of a number of documents filed in this case. The request is GRANTED.

Evidentiary Objections

Defendant submits a number of objections to Plaintiffs’ separate statement and the Declarations of Cesar Romero in support of Plaintiffs’ Motion and Reply.

The Court notes at the outset that Defendant has failed to consecutively number its objections as required by California Rules of Court Rule 3.1354, making it difficult for the Court to identify which objections it intends to sustain and overrule. The Court admonishes Defendants and expects the parties to fully comply with all requirements set forth in the Rules of Court and Code of Civil Procedure.

Objection to Plaintiffs’ separate statement – OVERRULED.

Objections to the Declaration of Cesar Romero in support of Plaintiff’s Motion

¶ 2 – OVERRULED

¶ 4-7, ¶ 9-10 – SUSTAINED

The remaining objections are immaterial to the disposition of the Court. Accordingly, the Court declines to rule upon them.

Objections to the Declaration of Cesar Romero in support of Plaintiff’s Reply

¶ 8 – SUSTAINED

The remaining objections are immaterial to the disposition of the Court. Accordingly, the Court declines to rule upon them.

Discussion

Plaintiffs move for an order (1) disqualifying Early Sullivan Wright Gizer & McRae LLP (“Early Sullivan”) from further representing Defendant in this action; and (2) for issue sanctions. Plaintiffs seeks issue sanctions, finding that Defendant engaged in bad faith by: (a) favoring Shih/Ko over Plaintiffs; (b) disseminating Plaintiff’s confidential and privileged documents to Shih/Ko so that it can be used against Plaintiffs in the related encroachment case; (c) hiding from this Court the confidentiality agreement with Plaintiffs that prevented Defendant from disclosing confidential and privileged information to the Shih/Ko parties in the encroachment case; (d) filing false statements with this Court in order to aid Shih/Ko in the encroachment case; (e) by failing to inform Plaintiffs that they were Defendant’s insured and that their policy would cover the Shih/Ko encroachment; and/or (f) any other acts the Court deems appropriate.

Plaintiffs argue that they have had a confidentiality agreement in place with Defendant since July 7, 2017. (Romero Decl., Exh. 1.) Plaintiffs assert that Defendant breached this agreement by intentionally disseminating the privileged and confidential information in the public domain without Plaintiffs’ authorization in order to aid Plaintiffs’ adversaries in the related encroachment case. Plaintiffs contend that Defendant, through its attorneys, has coordinated efforts with Janet Humphrey from Songstad Randall Coffee & Humphrey LLP (hereinafter “Humphrey”), attorneys of Shih/Ko in the related case, so that all of the intentionally published privileged and confidential information and deposition transcripts are used by Humphrey against the Plaintiffs in the related case.

Plaintiffs argue that Defendant, through its counsel, intentionally chose to disseminate privileged and confidential information without Plaintiffs’ permission and disguised that dissemination as discovery motions and other motions. Plaintiffs assert that the dissemination was done in bad faith and in order to publish the privileged information in the public domain so that Humphrey could use it in the underlying case to her advantage. Plaintiffs contend that the dissemination includes the filing of (1) the Brenda Wendt appraisal and related communications; (2) Lisa Weinberg-FATIC communications and documents; (3) unredacted Weinberg bills; and (4) information and documents related to David Gribin.

Plaintiffs argue that the referenced documents were attached as support for (1) Defendant’s Motion for Summary Adjudication; (2) Defendant’s Ex-Parte Application for an Order Specially Setting its Motion to Compel Plaintiffs’ Further Supplemental Responses; (3) Defendant’s Motion to Compel Plaintiffs’ Further Supplemental Responses to Request for Production of Documents, Set Two; (4) Defendant’s Opposition to Plaintiffs’ Motion to Quash Deposition Subpoena of David Gribin; and (5) Defendant’s Motion to Compel Plaintiffs’ Further Responses to Special Interrogatories, Set Three. Plaintiffs assert that Defendant engaged in reprehensible, bad faith conduct by continuing to aid and collude with Plaintiffs’ adversaries in the underlying action in order to gang up on and defeat Plaintiffs in both actions.

In opposition, Defendant first argues that Plaintiffs’ motion is procedurally and substantively defective, as it purports to be based on Section 2023.010 of the Civil Discovery Act, but does not actually identify any misuses of the discovery process and seems to have been brought in this fashion solely to allow for the filing of a separate statement. Defendant asserts that rather than containing the text of the requests and responses as issue, the separate statement is full of extensive legal and factual argument. Defendant contends that this is manifestly improper and an unfair attempt to get around the 15-page limit. Defendant contends that while the motion also purports to be based on Section 128.5 of the Code of Civil Procedure, the instant motion cannot be both a discovery motion and a sanctions motion, as that Section expressly provides that it “shall not apply to disclosures and discovery requests, responses, objections, and motions” and motions made under it “shall be made separate from other motions or requests.” (CCP ; 128.5(e), (f)(1)(A).) Defendant additionally argues that the motion is so disorganized as to preclude a fair response.

On the merits, Defendant asserts that an insurer has the right to defend against a lawsuit brought against it by its insured. Defendant contends that moreover, Plaintiffs do not identify any actual violation of the purported “confidentiality agreement” they describe, only public filings. Defendant argues that there is no dispute that there has never been a general protective order governing the dissemination and use of confidential documents in this litigation. (Gidding Decl. ¶ 2.) Defendant contends that the purported “confidentiality agreement” that serves as the basis of Plaintiffs’ motion is an email sent three months after Plaintiffs filed this lawsuit. Defendant argues that there is no evidence that either Plaintiff ever responded to this email and it is preposterous to suggest that pursuant to this email, a “confidentiality agreement” was reached. Defendant asserts that beyond this fatal problem, there is no evidence that any documents were transmitted pursuant to this email.

Defendant contends that there is no evidence that this purported agreement was breached, let alone breached by Defendant and/or its counsel. Defendant argues that Plaintiffs do not identify any confidential information they provided to Ms. Hilburg, Defendant’s coverage counsel, which was improperly disclosed. Defendant asserts that instead, Plaintiffs identify a number of public filings that Defendant’s counsel, Early Sullivan, made in this litigation. Defendant contends that even now, as they are seeking to disqualify Defendant’s counsel and obtain essentially dispositive evidentiary sanctions against it, Plaintiffs have made no effort to seal or redact the public filings of which they complain. Defendant argues that this demonstrates that this purported dispute over “confidential” information is not about safeguarding any information, but is simply an eleventh-hour distraction intended to harass Defendant and its counsel.

Defendant asserts that there is nothing improper about what Defendant’s counsel has done, neither in appearance nor in fact. Defendant contends that although Plaintiffs accuse Defendant’s counsel of unethical conduct, they do not identify any pertinent ethical rule which counsel has violated. Defendant argues that Early Sullivan has never represented Plaintiffs and has no ethical obligation to them beyond those extended to all opposing parties under the Rules of Professional Conduct. (Gidding Decl. ¶ 3.) Defendant asserts that the idea that Early Sullivan should be disqualified for engaging in conduct, i.e., litigation, which is “prejudicial” to Plaintiffs is absurd.

Defendant finally contends that to the extent that any of the information Defendant filed was privileged, any applicable privilege was waived both because Plaintiffs themselves put the communications in issue and further because Plaintiffs failed to object to the filings. Defendant argues additionally that, Janet Humphrey is independent counsel and Defendant does not control her or how she chooses to represent her client. Defendant asserts that Humphrey’s use of information filed by Defendant is the foreseeable result of Plaintiffs’ failure to assert any kind of privilege or confidentiality objection until very late in this litigation. Defendant contends that if Plaintiffs were concerned that discovery in this action might be used in the related encroachment action, Plaintiffs could have sought a confidentiality order or sought to seal the filings at the time. Defendant argues that Plaintiffs did neither and now seek to pin their woes on Defendant. Defendant asserts that the Court should note that Plaintiffs’ claims of collusion between Early Sullivan and Humphrey are a recent invention.

In reply, Plaintiffs argue that as to Defendant’s argument that Plaintiffs rely on Section 128.5, Plaintiffs never cite to that provision, but instead cite to Section 128(a)(5). As to Defendant’s arguments regarding waiver of the confidential or privileged nature of the documents, Plaintiffs argue that under the confidentiality agreement, Defendant had a duty not to disclose Plaintiffs’ confidential/privileged information to Plaintiffs’ adversaries. Plaintiffs assert that it was because of Defendant’s breach of the confidentiality agreement that the documents actually became unprivileged.

The Court finds that Plaintiffs have failed to provide sufficient evidence that Defendant, through its counsel, intentionally disseminated privileged and confidential information for the purpose of aiding Plaintiffs’ adversaries in the related case such that disqualification is warranted. Plaintiffs’ argument is based purely on conjecture and speculation, which does not amount to evidence sufficient to warrant disqualification. As the Court has previously ruled, Plaintiffs’ arguments regarding privileged and confidential information are unpersuasive, as it has long been settled that any privilege with regards to information that is now purportedly in the hands of Plaintiffs’ adversaries in the related case was not waived by Defendant through its court filings, but waived by Plaintiffs themselves through their various actions throughout this litigation.

Moreover, the confidentiality agreement that Plaintiffs rely on was entered into by Lorie Hilburg, Defendant’s coverage attorney at the time Plaintiffs filed suit against Defendant, not Defendant’s current counsel in this action. Accordingly, no purported confidentiality agreement was entered into by and between the parties here. Additionally, Plaintiffs fail to present evidence that any information was given to Hilburg pursuant to that agreement, much less that any information given pursuant to that agreement was intentionally disseminated by Defendant’s counsel.

Plaintiffs devote a great deal of their moving and reply papers arguing that Defendant’s actions, through their counsel, violate the duty of good faith and fair dealing, a central issue in the current action. Such an argument is misplaced at this time, as Plaintiffs essentially seek sanctions and disqualification of counsel based on the merit of allegations in the complaint. Plaintiffs arguments are more properly suited for trial, where Plaintiffs may argue the merits of this action.

Given the Court’s ruling finding that Plaintiffs’ failed to present evidence sufficient to warrant disqualification, the Court additionally finds that Plaintiffs have failed to provide sufficient evidence that Defendant engaged in a willful abuse of the discovery process or that there is a history of continued discovery abuse such that issue sanctions are warranted here. As noted by Defendant, Defendant is entitled to defend itself against the lawsuit brought by Plaintiffs. Nothing before the Court indicates that Defendant has engaged in an abuse of the discovery process by filing documents necessary to support its defense.

Based on the foregoing, Plaintiffs’ motion to disqualify and for issue sanctions is DENIED in its entirety.

Defendant’s Request for Monetary Sanctions

“The court may impose 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. The court may also impose this sanction on one unsuccessfully asserting that another has engaged in the misuse of the discovery process, or on any attorney who advised that assertion, or on both. If a monetary sanction is authorized by any provision of this title, the court shall impose that sanction unless it finds that the one subject to the sanction acted with substantial justification or that other circumstances make the imposition of the sanction unjust.” (CCP ; 2023.030(a).)

In its opposition, Defendant requests monetary sanctions against Plaintiffs for the costs incurred in opposing Plaintiffs’ motion. Defendant seeks sanctions in the amount of $4,125.00 for 10 hours spent preparing the opposing papers, an anticipated 2 hours reviewing the Reply, and an anticipated 3 hours spent preparing for and traveling to the hearing of the motion billed at a rate of $275 per hour. The Court finds that the amount of sanctions requested is excessive. The Court thus awards reduced sanctions in the amount of $2,200.00 for 5 hours spent preparing the opposing papers, 2 hours spent reviewing the Reply, and 1 hour spent attending the hearing.

Conclusion

Plaintiffs’ motion to disqualify and for issue sanctions is DENIED in its entirety. Defendant’s request for monetary sanctions is GRANTED. Plaintiffs are ordered to pay sanctions in the amount of $2,200.00 to Defendant within thirty (30) days of this order.

Moving party to give notice.



Case Number: ;****6649    Hearing Date: December 04, 2019    Dept: 31

MOTION TO DISQUALIFY IS CONTINUED TO DECEMBER 13, 2019.

Plaintiffs’ motion to disqualify is CONTINUED to December 13, 2019. Per Plaintiff’s Reply, Plaintiffs were not timely served with the Opposition, depriving them of the opportunity to draft a Reply on the merits. Plaintiffs may file a Reply on the merits pursuant to Code of Civil Procedure section 1005(b). No Sur-Reply will be permitted.

Plaintiffs Cesar Romero (“Cesar”) and Tatiana Romero sued Defendants First American Title Insurance Company (hereinafter “FATIC”), First American Title Company, and Prominent Escrow Services, Inc. for compensatory and injunctive relief, based on allegations that Plaintiffs’ non-party neighbor’s home improvements encroached onto Plaintiffs’ property. Plaintiffs also claim that FATIC, which provided Plaintiffs’ title insurance, acted in bad faith by improperly favoring Plaintiffs’ neighbors, “Shih/Ko,” in the dispute over the alleged encroachment and failed to pay Plaintiffs adequate damages to compensate for the diminution in value of their property caused by the encroachment. In the operative Second Amended Complaint (“SAC”), Plaintiffs assert causes of action for:

  1. Breach of Contract by Escrow Agents and Fiduciaries for Failure to Comply with Instructions;

  2. Negligence by Escrow Agents and Fiduciaries in the Performance of Their Duties;

  3. Breach of Fiduciary Duty;

  4. Damages for Negligent Representation;

  5. Damages for Fraud;

  6. Breach of Insurance Contract;

  7. Breach of the Duty of Good Faith and Fair Dealing; and

  8. Unfair Business Practices. 

The sixth, seventh, and eighth causes of action are pending against FATIC because the Court sustained FATIC’s demurrer to the first, second, third, fourth, and fifth causes of action without leave to amend on May 9, 2018. Also as a result of sustaining the demurrer without leave to amend on May 9, 2019, Defendant First American Title Company was dismissed with prejudice, as the first through fifth causes of action were the only ones asserted against it. On January 31, 2019, Plaintiffs dismissed Defendant Prominent Escrow Services, Inc. with prejudice.

On January 7, 2019, the Court denied Defendant’s motion to compel further responses to Request for Production of Documents, Set Two, Nos. 29 and 30, which sought information regarding appraisals prepared by David Gribin. The Court found that the appraisals were protected by the attorney-client privilege and work product doctrine. 

On September 16, 2019, the Court of Appeal issued a Temporary Stay Order, staying the enforcement of this Court’s September 3, 2019 Order, denying Plaintiff’s motion for protective order. The protective order sought an order instructing the deposition officer not to provide a copy of the deposition transcript, or audio or video recording, of the Deposition of Brenda Anne Wendt taken in this case on or about December 17, 2018 to the law firm of Stongstad Randall Coffee Humphrey LLP. 

On September 19, 2019, this Court continued Plaintiffs’ Motion for Protective Order pertaining to the Deposition of Lisa Weinberg “to enable the Court of Appeal to render a decision on Plaintiff’s writ of mandate taken on [the September 3, 2019] Order of the Court.”

Plaintiffs moves for an order directing Janet E. Humphrey of Songstad Randall Coffee Humphrey LLP (hereinafter “Humphrey”) to show cause why she should not be held in contempt of this Court.

Legal Standard

A contempt proceeding is commenced by the filing of an affidavit and a request for an order to show cause. (; 1211, subds. (a), (b).) After notice to the opposing party's lawyer, the court (if satisfied with the sufficiency of the affidavit) must sign an order to show cause re contempt in which the date and time for a hearing are set forth. (; 1212; Arthur v. Superior Court (1965) 62 Cal.2d 404, 408 [42 Cal.Rptr. 441, 398 P.2d 777] [“an order to show cause must be issued”]; Weil & Brown, Cal. Practice Guide: Civil Procedure Before Trial (The Rutter Group 1999) ¶ 9:715, p. 9(II)-47.) The order to show cause acts as a summons to appear in court on a certain day and, as its name suggests, to show cause why a certain thing should not be done. (Morelli v. Superior Court (1968) 262 Cal.App.2d 262, 269 [68 Cal.Rptr. 572].) Unless the citee has concealed himself from the court, he must be personally served with the affidavit and the order to show cause; otherwise, the court lacks jurisdiction to proceed.

(Cedars-Sinai Imaging Medical Group v. Superior Court (2000) 83 Cal.App.4th 1281, 1286–87.)

Pursuant to Code of Civil Procedure section 1209(a)(5), a party may be held in contempt for “[d]isobedience of any lawful judgment, order, or process of the court.” “When the contempt is not committed in the immediate view and presence of the court, or of the judge at chambers, an affidavit shall be presented to the court or judge of the facts constituting the contempt.” (Code of Civ. Proc., ; 1211(a).) To support an order to show cause re an indirect contempt (occurring outside the immediate presence of the court), a declaration must evidence, as jurisdictional requirements “(1) the making of the order, (2) knowledge of the order, (3) ability of the accused to render compliance, and (4) willful disobedience of the order.” (Application of Ny (1962) 201 Cal.App.2d 728, 731; accord Board of Supervisors v. Sup. Ct. (1995) 33 Cal.App.4th 1724, 1736.)

Request for Judicial Notice

The court may take judicial notice of “official acts of the legislative, executive, and judicial departments of the United States and of any state of the United States,” “[r]ecords of (1) any court of this state or (2) any court of record of the United States or of any state of the United States,” and “[f]acts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” (Evid. Code ; 452, subds. (c), (d), and (h).)

Taking judicial notice of a document is not the same as accepting the truth of its contents or accepting a particular interpretation of its meaning. (Fremont Indem. Co. v. Fremont General Corp. (2007) 148 Cal.App.4th 97, 113-14 (citations and internal quotations omitted).) In addition, judges “consider matters shown in exhibits attached to the complaint and incorporated by reference.” (Performance Plastering v. Richmond American Homes of California, Inc. (2007) 153 Cal.App.4th 659, 665.) However, “[w]hen judicial notice is taken of a document . . . the truthfulness and proper interpretation of the document are disputable.” (Aquila, Inc. v. Sup. Ct. (2007) 148 Cal.App.4th 556, 569 (quoting StorMedia Inc. v. Sup. Ct. (1999) 20 Cal.4th 449, 457 n. 9).)

Humphrey requests that the Court take judicial notice of a number of documents that have been filed in the Los Angeles Superior Court. The request is GRANTED.

Evidentiary Objections

Humphrey submits a number of objections to the Declaration of Cesar Romero. The Court rules upon them as follows:

Objection nos. 1-5 – SUSTAINED

Objection nos. 6-7 – OVERRULED

Objections as to Exhibits 1, 10-15, 17-20, 22-27 – SUSTAINED

Objections as to Exhibits 2, 6-8 – OVERRULED

Discussion

Plaintiffs move for an order directing Humphrey to show cause why she should not be held in contempt of this Court for violating this Court’s orders issued on January 7, 2019 and September 19, 2019.

In opposition, Humphrey argues that her conduct in representing her clients by conducting discovery and filing pleadings with the court in the Related Action is protected by the litigation privilege, which protects statements made in the course of judicial proceedings. (Civil Code ; 47(b)(2).) Humphrey asserts all statements, even defamatory statements made by an attorney during a judicial proceeding in which he participates as counsel are privileged if they have some relation to the proceedings. (Friedman v. Knecht (1967) 248 Cal.App.2d 455, 460; see also Pettitt v. Levy (1972) 28 Cal.App.3d 484, 489.) Humphrey contends that her litigation activities in the Related Action in pursuit of her clients’ defenses to the claims brought by the Romeros and in furtherance of the claims asserted by the Shih/Kos are all protected by the litigation privilege. Humphrey argues that the discovery demands and pleadings referenced in the Romeros’ motion are therefore privileged and are not a proper basis for this motion.

January 7, 2019 Order

The Court’s January 7, 2019 Order denied Defendant’s motion to compel further responses to Request for Production of Documents, Set Two, Nos. 29 and 30, which sought information regarding appraisals prepared by David Gribin. The Court found that the appraisals were protected by the attorney-client privilege and work product doctrine.

Plaintiffs argue that Humphrey violated this Court’s Order that David Gribin’s appraisals were privileged by stating in the Related Action that this Court’s Order is disingenuous and Gribin’s appraisals are not privileged. (Romero Decl., Exh. 1.) Plaintiffs assert that Humphrey further violated the January 7, 2019 Order by filing a motion to add Gribin as her expert and by serving numerous discovery requests demanding information and documents relating to Gribin. (Romero Decl., Exh. 2-5, 29.) Plaintiffs contend that not only did Humphrey violate this Court’s January 7, 2019 Order, Humphrey also made a multitude of fabricated and false statements to the Court in the Related Action relating to Gribin, such as her false statement that there is an existing deposition transcript of Gribin testimony in this case, that there is an existing Gribin appraisal report that was attached to Wendt’s transcript, or that Wendt was given a copy of Gribin’s appraisal and viewed the report. (Romero Decl. ¶ 20-21.) Plaintiffs argue that these statements were not an innocent mistake or oversight, but a calculated fabrication and misrepresentation of facts in order to convince the Court in the Related Action that Gribin’s appraisals are not privileged while concealing the existence of this Court’s January 7, 2019 Order.

In opposition, Humphrey argues that Humphrey was not a party to, was never served with or otherwise bound by the January 7, 2019 Order. Humphrey asserts that additionally, the January 7, 2019 Order does not prohibit Humphrey’s litigation conduct in the Related Action in any respect or purport to make any orders with respect to privilege in the Related Action. Humphrey contends that rather, FATIC was denied the ability to compel written discovery to enforce its subpoena against Gribin, although pursuant to the July 26, 2019 Order, FATIC was permitted to conduct written discovery confirming the amounts of Gribin’s valuation opinions. Humphrey argues that even if she was bound by the January 7, 2019 Order, it has not been violated by Humphrey.

Humphrey asserts that the Romeros’ contention that Humphrey falsely told the Court in the Related Action that the Gribin valuation is not privileged is inaccurate. Humphrey contends that she made good faith motions in the Related Action arguing that privilege with respect to Gribin had been waived, relying on evidence that the Gribin appraisal valuation was provided to Wendy and was filed in the public record. Humphrey argues that she is privileged to argue on behalf of her clients in the Related Action that under these circumstances, the Gribin valuation is not privileged. Humphrey asserts that Judge Kin in the Related Action is permitted to issue his own orders with respect to privilege.

As to the Romeros’ argument that Humphrey violated the January 7, 2019 Order by filing her motion to augment her clients’ expert designation in Related Action to add Gribin as a non-retained expert, Humphrey contends that such a contention is frivolous. Humphrey argues that she was not prohibited by the January 7, 2019 Order to file the Motion to Augment to add Gribin as a non-retained expert. Humphrey contends that she set forth all of the evidence in the public record supporting her clients' argument that the privilege has been waived. Humphrey argues that the Romeros’ counsel defended the Motion, making arguments and also attaching a copy of this Court's January 7, 2019 Order. Humphrey asserts that Judge Kin granted the Motion to Augment noting the “ample information concerning these experts and their valuations were publicly available.”

The Court finds that Humphrey did not violate this Court’s January 7, 2019 Order by arguing in the Related Action that Gribin’s appraisals were not privileged nor by designating Gribin as an expert. This Court’s January 7, 2019 Order found that under the circumstances at the time the Order was issued, Gribin’s appraisals were privileged. The Order did not hold that Gribin’s appraisals would forever be privileged or that the privilege could not later be waived. Moreover, the Court’s January 7, 2019 Order bound only the parties to this litigation. The Order did not bind the Court in the Related Action nor did it bind Humphrey. 

Based on the foregoing, a violation of the January 7, 2019 Order cannot serve as a basis for the instant motion.

September 19, 2019 Order

On September 19, 2019, the Court continued Plaintiffs’ Motion for Protective Order pertaining to the Deposition of Lisa Weinberg “to enable the Court of Appeal to render a decision on Plaintiff’s writ of mandate taken on an earlier Order of the Court” wherein the Court denied Plaintiffs’ motion for protective order. The protective order sought an order instructing the deposition officer not to provide a copy of the deposition transcript, or audio or video recording, of the Deposition of Brenda Anne Wendt taken in this case on or about December 17, 2018 to the law firm of Stongstad Randall Coffee Humphrey LLP.

Plaintiffs argue that Humphrey violated this Court’s September 19, 2019 order staying the enforcement of the September 3, 2019 Order by reviewing the transcript and by not returning it promptly to the sender pursuant to California Rules of Professional Conduct 4.4. Rule 4.4 provides: 

Where it is reasonably apparent to a lawyer who receives a writing relating to a lawyer’s representation of a client that the writing was inadvertently sent or produced, and the lawyer knows or reasonably should know that the writing is privileged or subject to the work product doctrine, the lawyer shall:

(a) refrain from examining the writing any more than is necessary to determine that it is privileged or subject to the work product doctrine, and

(b) promptly notify the sender.

Plaintiffs argue that Humphrey was notified of the pending Writ of Mandate and the Stay Orders on at least two separate occasions – the first time on September 6, 2019 and the second time on September 24, 2019. (Romero Decl., Exh. 9.) Plaintiffs assert that Humphrey was further advised by Plaintiffs’ counsel that if she is in possession of the transcript, it was her obligation to refrain from examining the transcript and return the transcript until a final decision is made by the Courts. (Romero Decl., Exh. 9.)

Plaintiffs contend that Humphrey violated Rule 4.4 by reviewing the deposition transcript and by not returning it promptly to the sender. Plaintiffs argue that Humphrey willfully violated this Court’s and the Appellate Court’s stay order on September 30, 2019 by filing a motion to add Wendt, Gribin, and Hackett as experts in the Related Action. (Romero Decl., Exh. 2.) Plaintiffs assert that in her motion, Humphrey quoted large portions from the Wendt transcript and actually attached the entire deposition transcript as well as the deposition exhibits as her supporting evidence.

In opposition, Humphrey argues that as to the Court of Appeals Stay Order, this Court cannot issue an OSC re Contempt for a Court of Appeals Order because only the Court of Appeals can determine whether its orders have been violated. As to this Court’s September 19, 2019 Order, Humphrey contends that Order simply stayed the enforcement of this Court’s September 3, 2019 Order denying a protective order for the Wendt Transcript. Humphrey argues that the September 19, 2019 Order was issued long after the Wendt transcript had already been released by Veritext, reviewed by Songstad Randall Coffee Humphrey LLP, and portions were filed with this Court in opposition to the Weinberg Protective Order Motion. Humphrey asserts that moreover, Humphrey did not file the Wendt transcript in connection with the Motion to Augment, but rather filed a copy of the Boswell Declaration that included portions of the Wendt Transcript that has been in the public record since May 10, 2019.

Humphrey contends that additionally, there has not been a violation of Rules of Professional Conduct Rule 4.4 as the Wendt transcript is not privileged, as confirmed by the September 3, 2019 Order and where there has never been an inadvertent disclosure. Humphrey argues that there was no obligation to refrain from reading the Wendt transcript that had already been produced to Songstad Randall Coffee Humphrey LLP by Veritext pursuant to this Court’s September 3, 2019 Order, before the Court of Appeals issued its September 16, 2019 Stay Order. Humphrey asserts that, for this reason, there has never been a violation of the September 19, 2019 Order and the Writ of Mandate has now been denied and the stay lifted.

The Court finds that Humphrey did not violate this Court’s September 19, 2019 Order. The Order did not stay the proceedings in this case nor did it make any order concerning the Related Action, as such an order would be outside the bounds of the Court’s jurisdiction. Despite Plaintiffs’ contention otherwise, Humphrey was not mandated by Rule 4.4 to return the deposition transcript to Veritext. Rule 4.4 relates to inadvertent disclosures and refers to when a “lawyer knows or reasonably should know that the writing is privileged or subject to the work product doctrine.” Given this Court’s ruling on September 3, 2019, it cannot be argued that Humphrey knew or reasonably should have known that the writing was privileged or subject to the work product doctrine. Accordingly, Rule 4.4 simply has no applicability here.

Based on the foregoing, a violation of the September 19, 2019 Order cannot serve as a basis for the instant motion.

Conclusion

Plaintiffs’ motion for an OSC re: contempt is DENIED.

Moving party to give notice.



Case Number: ****6649    Hearing Date: November 07, 2019    Dept: 31

MOTIONS FOR PROTECTIVE ORDER ARE DENIED.

Background

Plaintiffs Cesar Romero (“Cesar”) and Tatiana Romero sued Defendants First American Title Insurance Company (hereinafter “FATIC”), First American Title Company, and Prominent Escrow Services, Inc. for compensatory and injunctive relief, based on allegations that Plaintiffs’ non-party neighbor’s home improvements encroached onto Plaintiffs’ property. Plaintiffs also claim that FATIC, which provided Plaintiffs’ title insurance, acted in bad faith by improperly favoring Plaintiffs’ neighbors, “Shih/Ko,” in the dispute over the alleged encroachment and failed to pay Plaintiffs adequate damages to compensate for the diminution in value of their property caused by the encroachment. In the operative Second Amended Complaint (“SAC”), Plaintiffs assert causes of action for:

  1. Breach of Contract by Escrow Agents and Fiduciaries for Failure to Comply with Instructions;

  2. Negligence by Escrow Agents and Fiduciaries in the Performance of Their Duties;

  3. Breach of Fiduciary Duty;

  4. Damages for Negligent Representation;

  5. Damages for Fraud;

  6. Breach of Insurance Contract;

  7. Breach of the Duty of Good Faith and Fair Dealing; and

  8. Unfair Business Practices. 

The sixth, seventh, and eighth causes of action are pending against FATIC because the Court sustained FATIC’s demurrer to the first, second, third, fourth, and fifth causes of action without leave to amend on May 9, 2018. Also as a result of sustaining the demurrer without leave to amend on May 9, 2019, Defendant First American Title Company was dismissed with prejudice, as the first through fifth causes of action were the only ones asserted against it. On January 31, 2019, Plaintiffs dismissed Defendant Prominent Escrow Services, Inc. with prejudice.

The instant motions for protective order seek (1) a protective order to prevent disclosure of the Deposition Transcript of Lisa Weinberg (“Weinberg Protective Order”) and (2) a protective order effectively preventing the Shih/Ko’s and their counsel, Songstad Randall Coffee & Humphrey (hereinafter “Songstad”), from using any discovery provided or obtained in the instant action (“Shih/Ko Protective Order”).

Legal Standard

“The court, for good cause shown, may make any order that justice requires to protect any party, deponent, or other natural person or organization from unwarranted annoyance, embarrassment, or oppression, or undue burden and expense.” (Code Civ. Proc., ; 2025.420(b).) Courts have considerable discretion in granting and crafting protective orders. (Raymond Handling Concepts Corp. v. Superior Court (1995) 39 Cal.App.4th 584, 588.)

Request for Judicial Notice

The court may take judicial notice of “official acts of the legislative, executive, and judicial departments of the United States and of any state of the United States,” “[r]ecords of (1) any court of this state or (2) any court of record of the United States or of any state of the United States,” and “[f]acts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” (Evid. Code ; 452, subds. (c), (d), and (h).)

Weinberg Protective Order

Songstad requests that the Court take judicial notice of a number of documents filed in this action. The request is GRANTED.

Shih/Ko Protective Order

Plaintiffs request that the Court take judicial notice of a number of documents filed in this action and in LASC Case No. EC064933, Romero v. Shih, et al. The request is GRANTED.

Songstad also requests that the Court take judicial notice of various documents filed in this action and the Order of the Court of Appeal denying Plaintiff’s Petition for Writ of Mandate. The request is GRANTED.

Evidentiary Objections

Shih/Ko Protective Order

Songstad submits a number of objections to the Declarations of Paul T. Dye and Cesar Romero. The Court finds that the objections are immaterial to the Court’s disposition. Accordingly, the Court declines to rule upon them.

Discussion

Weinberg Protective Order

In a motion nearly identical to the one submitted to and ruled upon by the Court on September 3, 2019, Plaintiffs now seek a protective order instructing the deposition officer, Veritext Legal Solutions, not to provide a copy of the deposition transcript, or audio or video recording, of the Deposition of Lisa Weinberg, Plaintiffs’ former counsel, taken in this case on or about December 20, 2018, to Li-Chuan Shih or Tun-Jen Ko or the firm of Songstad Randall Coffee Humphrey LLP.

Plaintiffs argue that the Lisa Weinberg deposition is the second deposition involving privileged matter that Shih/Ko have sought in this case. Plaintiffs assert that it now appears that FATIC has joined forces with Shih/Ko to defeat the claims against them by the Romeros. Plaintiffs contend that such an alliance has been condemned by the courts of this state and the Romeros should be granted a protective order to stop this improper “ganging up” on Plaintiffs. (Haskel, Inc. v. Superior Court (1995) 33 Cal.App.4th 963, 978-980.)

Plaintiffs argue that “good cause” is demonstrated in three independent ways: (1) case law is clear that an insurer, here FATIC and a defendant in an underlying action, Shih/Ko, should not be permitted to gang up on the insured; (2) depositions of opposing counsel are presumptively improper, severely restricted, and require “extremely” good cause which has not been shown here; and (3) the information sought is protected by the attorney-client privilege and attorney work product doctrine and there is no waiver.

Insurer/Insured Considerations & Opposing Counsel Depositions

As to the first ground, Plaintiffs assert that FATIC took Weinberg’s deposition as part of the discovery for its claim that it adequately compensated that Romeros and thereby ended its duty of defense. Plaintiffs contend that the thrust of FATIC’s discovery directly conflicts with the Romero’s goals in the Shih/Ko case, and give aid and comfort to Shih/Ko. Plaintiffs argue that FATIC and Shih/Ko share the same goal – to minimize the amount, while the Romeros are seeking the highest possible damages for the encroachment. Plaintiffs assert that this ganging up by the insurer with the opposition in the underlying suit is not permitted, as California law prohibits an insurer favoring one insured over another. (Schwartz v. State Farm Fire & Cas. Co. (2001) 88 Cal.App.4th 1329, 1337-1339.)

Plaintiffs contend that the best way to combat any issues that arise as a result of an insurer attempting to use the bad faith case to litigate matters properly addressed in the underlying action would have been to stay discovery in this case until the Shih/Ko case is concluded. Plaintiffs argue that the requested relief is the best available under the circumstances. Plaintiffs contend that they suffer prejudice by giving Shih/Ko access to FATIC’s discovery which by its nature seeks to undermine the Romero’s position in both cases. Plaintiffs argue that they also suffer prejudice because they have been stuck in a two front war, expending precious resources fighting over loss questions, and this effectively undercuts one of the primary reasons for purchasing the insurance. Plaintiffs assert that this is “good cause” to grant a protective order preventing Shih/Ko from getting access to the Weinberg deposition.

As to the second ground, Plaintiffs contend that California law is clear: “Depositions of opposing counsel are presumptively improper, severely restricted, and require ‘extremely’ good cause – a high standard.” (Carehouse Convalescent Hosp. v. Superior Court (2006) 143 Cal.App.4th 1558, 1562.) Plaintiffs argue that although Weinberg’s deposition has been taken in this case, it is clear that it would not be allowed in the Shih/Ko case. Plaintiffs assert that Shih/Ko should not be permitted to get the deposition via this backdoor route. Plaintiffs contend that the strong policy considerations against deposing an opposing counsel apply here.

In opposition, Songstad argues that the evidence provided by the Weinberg deposition is obviously relevant to the issues in the related Shih/Ko action (“Related Action”), as one of the main issues in the Related Action is the value of the alleged encroachments and therefore any appraisals and any testimony, expert or otherwise, regarding appraisals are highly relevant. Songstad asserts that moreover, Plaintiffs argue without any evidence that FATIC and Songstad are somehow “ganging up” on the Romeros. Songstad contends that the Romeros’ argument is pure speculation and ignores the fact that they, themselves, have failed to object to portions of the Weinberg deposition being made part of the public record, having been filed in connection with the Motions to Compel.

As to Plaintiffs’ argument regarding opposing counsel depositions, Songstad argues that they are not attempting to take an adversary’s deposition; the Weinberg deposition has already been taken. Songstad asserts that instead, the relevant issue is whether the Romeros took any steps to ensure that the transcript would be confidential and not disclosed in the Related Action. Songstad contends that the Romeros did nothing to maintain confidentiality of the Weinberg deposition testimony and, therefore, there has been a waiver.

In reply, Plaintiffs argue that Songstad admits that it is unable to rebut the Romeros’ showing of “good cause,” instead alleging “waiver” as a sufficient basis for denying a protective order. Plaintiffs assert that this misstates the proper procedure for considering a protective order against third party disclosure under Code of Civil Procedure section 2025.420. Plaintiffs contend that waiver does not prevent issuance of a protective order, citing to Stadish v. Superior Court ((1999) 71 Cal.App.4th 1130, 1143-1144). Plaintiffs argue that the Court “must . . . balance the interests of the public, the petitioners, and the [party who produced the discovery], and reach a decision as to whether dissemination of the documents should be restricted. (Id. at 1146.) Plaintiffs assert that in so doing, the trial court needs to consider “the purpose of the information sought, the effect that disclosure will have on the parties and on the trial, the nature of the objections urged by the party resisting disclosure, and ability of the court to make an alternative order which may grant partial disclosure, disclosure in another form, or disclosure only in the event that the party seeking the information undertakes certain specified burdens which appear just under the circumstances.” (Valley Bank of Nevada v. Superior Court (1975) 15 Cal.3d 652, 658.)

The Court finds that Plaintiffs have failed to establish good cause for the requested protective order based on insurer/insured considerations and their arguments regarding opposing counsel depositions. As noted by Songstad, the Shih/Kos are not attempting to depose Weinberg, but are instead seeking the transcript of a deposition that has already occurred. Additionally, there is no evidence that establishes that FATIC and Songstad are “ganging up” on Plaintiffs or that FATIC is attempting to use this action to litigate matters properly addressed in the Related Case. Moreover, Songstad has sufficiently demonstrated that the Weinberg deposition is relevant to the Related Action. Given the relevancy of the information sought, the issue of whether there is good cause for a protective order thus turns on whether the information sought is confidential or privileged, and whether such protections have been waived.

Attorney Client Privilege, Work-Product Doctrine, and Waiver

The issues of attorney-client privilege, work-product doctrine protections, and waiver regarding Weinberg and the Wendt appraisal have been addressed at length in this Court’s September 3, 2019 order.

The Court finds the communications amongst Wendt, Plaintiffs, and Plaintiffs’ counsel [Weinberg] and the Wendt appraisal itself are protected by the attorney-client privilege and work-product doctrine. Wendt was a business associate who was hired by Plaintiffs’ former counsel [Weinberg] to conduct an appraisal in the Shih/Ko case. It is undisputed that Wendt was hired to further the interest of Plaintiffs. Thus, any communications between Wendt on the one hand, and Plaintiffs or their counsel [Weinberg] on the other is privileged under the attorney-client privilege. The appraisal itself is also protected by the work product doctrine, as it is undisputed that appraisals developed as a result of the initiative of counsel in preparing for trial is protected work product. . . .

. . . . . . . . . .

The Court finds that the attorney-client privilege and work-product protections concerning the Wendt appraisal have been waived and that the Wendt deposition is thus discoverable. Based on the evidence before it, the Court finds that Weinberg acted as if she was Cumis counsel without any objection by FATIC, indeed with FATIC’s tacit approval, from November 2016 to February 2017. At the time Weinberg contacted FATIC on behalf of the Romeros to submit a claim requesting coverage based on the defense of the Cross-Complaint, there existed a clear conflict of interest subject to the provisions of Section 2860: FATIC insured both the Romeros and Shih/Ko who had competing claims against each other. Thus, FATIC’s “competing interests create[d] an ethical conflict for counsel.” (Centex Homes, supra, 237 Cal.App.4th at 30.) As our Supreme Court has held, an “insurance company [can]not control the defenses of the two policyholders, and the [policyholder] who retain[s] his own counsel [i]s entitled to reimbursement of his costs of suit and attorneys’ fees. [Citation.] The conflict [i]s clear.” (Centex Homes v. St. Paul Fire & Marine Ins. Co. (2018) 19 Cal.App.5th 789, 803 (citing O’Morrow v. Borad (1946) 27 Cal.2d 794, 799-800).)

Because a conflict of interest existed at the time Plaintiffs requested coverage of the defense of the Shih/Ko Cross-Complaint, Plaintiffs were entitled to independent or Cumis counsel “of [their] choosing ‘who represents the insured, not the insurer.’” (Centex Homes, supra, 237 Cal.App.4th at 30.) FATIC agreed to defend Plaintiffs until an appraisal of the purported encroachment was completed. (Dye Decl., Exh. C.) Whether or not the term “Cumis counsel” was ever uttered, Weinberg acted as Cumis counsel from November 2016 until February 2017. However, in February 2017, FATIC paid Plaintiffs $95,000.00 as the value of the encroachment on their land and told them that it would stop defending Plaintiffs on the cross-complaint in the lawsuit against Shih/Ko and it did. (Romero Decl. ¶ 7.) At that time – February 2017 – Weinberg ceased to be Cumis counsel. Thus, any communications made to FATIC after February 2017 would not have been pursuant to or covered by Section 2860, as Weinberg was simply no longer independent or Cumis counsel. Further, any communications made to FATIC after February 2017 would also not be protected under the independent basis in Soltani-Rastegar because the communications would not have “been intended for the information or assistance of an attorney” hired by FATIC to defend them. Any communications regarding the Wendt appraisal after February 2017 to FATIC would thus be a waiver of any privileges or protections.

The evidence indicates that the Romeros provided FATIC with the Wendt appraisal in March 2017, one month after FATIC informed them that FATIC would no longer provide a defense in Shih/Ko litigation. (RJN, Exh. 3, Romero Decl. ¶ 7.) At that point, the Romeros waived any attorney-client or work-product privileges or protections related to the appraisal. Even if the March 2017 disclosure of the Wendt appraisal was not a waiver, at the time Wendt’s deposition was taken in December 2018, without any objection and without a confidentiality or protective order in place, any privileges or protections evaporated.

And it is correct that Plaintiffs’ further filing of the summary of the Wendt appraisal and portions of her deposition transcript with the Court also waived any privileges or protections, as the summary and portions of the transcript are now a matter of public record.

(Songstad RJN, Exh. 1.)

Here, the Court similarly finds that the communications amongst Wendt, Plaintiffs, and Weinberg and the Wendt appraisal itself are protected by the attorney-client privilege and work-product doctrine. However, the Court also finds that the attorney-client privilege and work-product protections concerning the Wendt appraisal and any communications amongst Wendt, Plaintiffs, and Weinberg have been waived to the extent they were discussed at the Wendt and Weinberg depositions. Accordingly, the Court finds that the Weinberg deposition is discoverable and no good cause exists for the protective order sought.

As explained in the Court’s September 3, 2019 Minute Order, any communications made to FATIC after February 2017 would not have been pursuant to or covered by Section 2860, as Weinberg was simply no longer independent or Cumis counsel. Further, any communications made to FATIC after February 2017 would also not be protected under the independent basis in Soltani-Rastegar because the communications would not have “been intended for the information or assistance of an attorney” hired by FATIC to defend them. Any communications regarding the Wendt appraisal or regarding communications amongst Wendt, Plaintiffs, and Weinberg after February 2017 to FATIC would thus be a waiver of any privileges or protections. Here, the deposition of Lisa Weinberg was taken on December 20, 2018, long after February 2017, without any objection and without a confidentiality or protective order in place. At that time, any privileges or protections evaporated.

Based on the foregoing, Plaintiffs’ motion for protective order is DENIED.

Monetary Sanctions

Code of Civil Procedure section 2025.420(h) provides in relevant part: “The court shall impose a monetary sanction under Chapter 7 (commencing with Section 2023.010) against any party, person, or attorney who unsuccessfully makes or opposes a motion for a protective order, unless it finds that the one subject to the sanction acted with substantial justification or that other circumstances make the imposition of the sanction unjust.”

Songstad requests sanctions against Plaintiffs in the amount of $6,150.00 for 11.2 hours spent reviewing, researching, and drafting the opposition, an anticipated 1 hour reviewing the Reply, and an anticipated 4 hours traveling to and from Court to attend the hearing billed at a rate of $250 per hour. Given that the opposition was filed after the Court’s ruling on the protective order regarding the Wendt deposition and the substantially similar arguments raised, the Court finds that the amount of sanctions requested is unreasonable. The Court awards reduced sanctions in the amount of $2,750.00, for 5 hours spent preparing the opposition and 1 hour attending the hearing billed at a rate of $250 per hour.

Shih/Ko Protective Order

Plaintiffs seek a protective order that provides that:

  1. Neither Li-Chuan Shih or Tun-Jen Ko, nor their counsel or agents, shall use for any purpose the Brenda Wendt appraisal, or any analyses by Brenda Wendt or David Gribin of the Romero property in Sierra Madre or of the encroachment;

  2. Neither Li-Chuan Shih or Tun-Jen Ko, nor their counsel or agents, shall use for any purpose any information relating to any valuation or appraisals, or any testimony expert or otherwise regarding appraisals, contained in any depositions in this case;

  3. Neither Li-Chuan Shih or Tun-Jen Ko, nor their counsel or agents, shall use for any purpose any discovery provided or obtained in this case, including the transcript of any deposition obtained in this action;

  4. Neither Li-Chuan Shih or Tun-Jen Ko, nor their counsel or agents, shall use for any purpose any document filed in connection with FATIC’s motion for summary adjudication, or any motion to compel or any motion for protective order in this case;

  5. Neither Li-Chuan Shih or Tun-Jen Ko (“Shih/Ko”), nor their counsel or agents, shall use for any purpose any information obtained from First American Title Insurance Company (“FATIC”) concerning this case;

  6. Neither FATIC, nor its counsel or agents, shall provide Shih/Ko, or their counsel or agents, any information provided by or obtained from Cesar Romero or Tatiana Romero, or their attorneys or agents, with respect to any valuation or appraisals, or any testimony expert or otherwise regarding appraisals of the Romero property; and

  7. Neither FATIC, nor its counsel or agents, shall provide any information concerning this case to Shih/Ko, their counsel or agents.

Plaintiffs argue that the requested protective order is necessary to prevent misuse against the Romeros in the Shih/Ko case of valuation and related privileged information produced through discovery in this case.

Plaintiffs’ motion for protective order is DENIED. The Court knows of no authority, and none is supplied, that allows this Court to determine the use or admissibility of evidence in the Related Action regardless of its origin. Plaintiffs’ remedy is to seek the exclusion of that evidence via a motion in limine or otherwise before the trial judge handling the Related Action.

Monetary Sanctions

Code of Civil Procedure section 2025.420(h) provides in relevant part: “The court shall impose a monetary sanction under Chapter 7 (commencing with Section 2023.010) against any party, person, or attorney who unsuccessfully makes or opposes a motion for a protective order, unless it finds that the one subject to the sanction acted with substantial justification or that other circumstances make the imposition of the sanction unjust.”

The Court finds that the imposition of sanctions is not warranted here as it appears that Plaintiffs may have properly brought this motion in the Related Action.

Conclusion

Plaintiffs’ motions for protective order are DENIED. Plaintiffs are ordered to pay sanctions in the amount of $2,750.00 to Songstad Randall Coffee Humphrey LLP within 30 days.

Third party Songstad Randall Coffee Humphrey LLP is ordered to give notice.



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