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This case was last updated from Los Angeles County Superior Courts on 06/05/2019 at 08:48:04 (UTC).

CHUNG & ASSOCIATES LLC ET AL VS XAVIER RUFFIN ET AL

Case Summary

On 09/29/2017 CHUNG ASSOCIATES LLC filed a Contract - Other Contract lawsuit against XAVIER RUFFIN. This case was filed in Los Angeles County Superior Courts, Stanley Mosk Courthouse located in Los Angeles, California. The Judge overseeing this case is GREGORY W. ALARCON. The case status is Pending - Other Pending.

Case Details Parties Documents Dockets

 

Case Details

  • Case Number:

    ****7815

  • Filing Date:

    09/29/2017

  • Case Status:

    Pending - Other Pending

  • Case Type:

    Contract - Other Contract

  • Court:

    Los Angeles County Superior Courts

  • Courthouse:

    Stanley Mosk Courthouse

  • County, State:

    Los Angeles, California

Judge Details

Presiding Judge

GREGORY W. ALARCON

 

Party Details

Plaintiffs, Petitioners and Respondents

CHUNG & ASSOCIATES LLC

CASHMERE AGENCY

Defendants, Respondents and Appellants

MENDOZA RICARDO

RUFFIN XAVIER

DOES 1 THROUGH 50

CHUNG & ASSOCIATES LLC

CASHMERE AGENCY

LEVON MADATIAN ANGELES ATTORNEY SERVICES

Not Classified By Court

MCKINLEY POTEAT TRAVIS

JANSEN NAREN

Attorney/Law Firm Details

Plaintiff and Petitioner Attorneys

THE KERNAN LAW FIRM

KATRINAK RAYMOND PAUL

Appellant Attorney

POTEAT TRAVIS MCKINLEY

Defendant and Respondent Attorneys

ROMINES MELINDA C.

THE LANDAU GROUP PC

SAVAGE CHRISTINE E

KERNAN STEPHEN MICHAEL

 

Court Documents

EX PARTE APPLICATION TO ISSUE A PROTECTIVE ORDER USING LOS ANGELES MODEL STIPULATION AND PROTECTIVE ORDER CONFIDENTIAL AND HIGHLY CONFIDENTIAL DESIGNATIONS

1/30/2018: EX PARTE APPLICATION TO ISSUE A PROTECTIVE ORDER USING LOS ANGELES MODEL STIPULATION AND PROTECTIVE ORDER CONFIDENTIAL AND HIGHLY CONFIDENTIAL DESIGNATIONS

Minute Order

2/20/2018: Minute Order

NOTICE OF NON-OPPOSITION

3/6/2018: NOTICE OF NON-OPPOSITION

OBJECTION TO UNTIMELY OPPOSITION AND REQUEST TO STRIKE

5/24/2018: OBJECTION TO UNTIMELY OPPOSITION AND REQUEST TO STRIKE

NOTICE OF UNAVAILABILITY

6/14/2018: NOTICE OF UNAVAILABILITY

DEFENDANTS MEMORANDUM AND POINTS OF AUTHORITIES IN OPPOSITION TO PLAINTIFF'S MOTION FOR DISCOVERY REFEREE, TO COMPEL A SECOND DEPOSITION AND PRODUCTION OF DOCUMENTS

6/25/2018: DEFENDANTS MEMORANDUM AND POINTS OF AUTHORITIES IN OPPOSITION TO PLAINTIFF'S MOTION FOR DISCOVERY REFEREE, TO COMPEL A SECOND DEPOSITION AND PRODUCTION OF DOCUMENTS

PLAINTIFF CHUNG & ASSOCIATES, LLC DBA CASHMERE AGENCY'S REQUEST FOR JUDICIAL NOTICE IN SUPPORT OF REPLY

6/26/2018: PLAINTIFF CHUNG & ASSOCIATES, LLC DBA CASHMERE AGENCY'S REQUEST FOR JUDICIAL NOTICE IN SUPPORT OF REPLY

NOTICE OF NON-OPPOSITION

7/16/2018: NOTICE OF NON-OPPOSITION

Minute Order

7/16/2018: Minute Order

Minute Order

7/25/2018: Minute Order

Notice

12/3/2018: Notice

Unknown

1/24/2019: Unknown

Minute Order

2/26/2019: Minute Order

Unknown

3/7/2019: Unknown

Memorandum

4/4/2019: Memorandum

Objection

4/8/2019: Objection

Unknown

5/1/2019: Unknown

SUMMONS

9/29/2017: SUMMONS

205 More Documents Available

 

Docket Entries

  • 05/30/2019
  • Appeal - Reporter Appeal Transcript Process Fee Paid; Filed by Ricardo Mendoza (Appellant); Xavier Ruffin (Appellant)

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  • 05/29/2019
  • Appeal - Ntc Designating Record of Appeal APP-003/010/103 ("U"); Filed by Ricardo Mendoza (Appellant); Xavier Ruffin (Appellant)

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  • 05/28/2019
  • Memorandum of Points & Authorities; Filed by Ricardo Mendoza (Defendant); Xavier Ruffin (Defendant)

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  • 05/17/2019
  • Appeal Record Delivered; Filed by Clerk

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  • 05/16/2019
  • Appeal - Notice of Default Issued; Filed by Clerk

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  • 05/15/2019
  • Appeal - Original Clerk's Transcript 1 - 5 Volumes Certified; Filed by Clerk

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  • 05/14/2019
  • at 08:30 AM in Department 36, Gregory W. Alarcon, Presiding; Hearing on Motion for Protective Order - Not Held - Taken Off Calendar by Party

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  • 05/10/2019
  • Declaration (of Kelsey Schultz re: Attorney's Fees in Support of Court Judgment); Filed by Cashmere Agency (Plaintiff); Chung & Associates, LLC (Plaintiff)

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  • 05/10/2019
  • Declaration (of S. Michael Kernan re: Attorney's Fees in Support of Court Judgment); Filed by Cashmere Agency (Plaintiff); Chung & Associates, LLC (Plaintiff)

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  • 05/10/2019
  • Declaration (of S. Michael Kernan in Support of Plaintiff's Request for Court Judgment); Filed by Cashmere Agency (Plaintiff); Chung & Associates, LLC (Plaintiff)

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343 More Docket Entries
  • 12/08/2017
  • Declaration; Filed by Xavier Ruffin (Defendant); Ricardo Mendoza (Defendant)

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  • 12/08/2017
  • Demurrer; Filed by Defendant/Respondent

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  • 10/06/2017
  • Proof of Service

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  • 10/06/2017
  • Proof of Service

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  • 10/06/2017
  • Proof of Service (not Summons and Complaint); Filed by Plaintiff/Petitioner

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  • 10/06/2017
  • Proof of Service (not Summons and Complaint); Filed by Plaintiff/Petitioner

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  • 10/06/2017
  • Proof of Service (not Summons and Complaint); Filed by Plaintiff/Petitioner

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  • 09/29/2017
  • Complaint; Filed by null

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  • 09/29/2017
  • COMPLAINI FOR: (1) BREACH OF WRITTEN CONTRACT; ETC

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  • 09/29/2017
  • SUMMONS

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Tentative Rulings

Case Number: BC677815    Hearing Date: February 02, 2021    Dept: 36

 

 *COUNSEL – YOU CANNOT SUBMIT ON THE TENTATIVE PRIOR TO THE HEARING*

Superior Court of California

County of Los Angeles

Department 36

CHUNG & ASSOCIATES, LLC, dba CASHMERE AGENCY,

Plaintiff,

v.

XAVIER RUFFIN, et al.

Defendants.

Case No.: BC677815

Hearing Date: 2/2/2021

[TENTATIVE] RULING RE: Plaintiff’s Motion for Attorney Fees and Costs

The motion is denied without prejudice.

Background

Plaintiff Chung & Associates, LLC dba Cashmere Agency (“Cashmere”) is a marketing company that builds advertising campaigns across various industries, including music, art, sports, and fashion. Plaintiff brought the instant actions against two former employees, Defendants Xavier Ruffin (“Ruffin”) and Ricardo Mendoza (“Mendoza”) (collectively “Defendants”). Plaintiff alleges that Defendants unlawfully used confidential and proprietary information in violation of their employee agreements.

This action has a protracted procedural history.

On December 27, 2017, Plaintiff filed the operative first amended complaint (“FAC”) asserting two causes of action: (1) breach of contract – violation of confidentiality and non-disclosure agreement; and (2) violation of California Uniform Trade Secrets Act sections 3426 et seq.

On March 13, 2018, Defendants filed a cross-complaint, alleging Plaintiff commenced this action to retaliate against Defendants.

On June 8, 2018, the court granted Plaintiff’s special motion to strike, striking the cross-complaint’s fourth cause of action. (An appeal was dismissed on October 28, 2020 and reimittitur was issued on December 29, 2020.)

On January 9, 2019, the court granted Plaintiff’s motion for terminating sanctions and monetary sanctions in part, by (1) striking Defendants’ answer to the complaint and (2) striking the Defendants’ cross-complaint.

On February 26, 2019, the court denied Defendants’ motion to vacate terminating sanctions.

On September 25, 2019, the court granted Plaintiff’s motion for issue sanctions, finding that the damages amount Defendants received from Cashmere’s customers are correct and presumed to be the proper amount of damages.

On June 2, 2020, the court granted Plaintiff’s application to set aside default and ordered Defendants’ defaults entered on March 28, 2019 vacated. The parties stipulated to set aside default only. The stipulation did not affect Defendants’ answer and cross-complaint, apart from the fourth cause of action. In other words, Defendants’ answer remained stricken.

On June 12, 2020, Plaintiff filed a motion for summary judgment or in the alternative summary adjudication.

On September 21, 2020, the court denied Plaintiff’s motion for summary judgment, but granted Plaintiff’s motion for summary adjudication in the alternative. The court found in Plaintiff’s favor on its claim for misappropriation of trade secret based on unjust enrichment and Plaintiff’s entitled to attorney fees for Defendants’ willful and malicious conduct to Plaintiff as a prevailing party pursuant to Civil Code section 3426.4.

On November 10, 2020, the court entered judgment in Plaintiff’s favor.

On December 21, 2020, Defendants filed an ex parte application for an order entering a first amended judgment. Defendants sought to have the court dismiss the first cause of action so that they could have an appealable order.

On January 6, 2021, Plaintiff filed the instant motion for attorney fees in the amount of $642,760.00 and costs in the amount of $4,765.08.

On January 27, 2021, the court issued its order on the ex parte application to amend the judgment. The court vacated the November 10, 2020 judgment because it violated the one final judgment rule because Plaintiff still maintained the breach of contract cause of action.

On January 20, 2021, Defendants opposed Plaintiff’s motion for attorney fees.

On January 26, 2021, Plaintiff filed a reply to Defendants’ opposition.

Legal Standard

Pursuant to Code of Civil Procedure section 1033.5, subdivision (a)(10)(B), attorney fees when authorized by statute are allowable as costs and may be awarded upon a noticed motion pursuant to Code of Civil Procedure section 1033.5, subdivision (c)(5).

In determining what fees are reasonable, California courts apply the “lodestar” approach. (See, e.g., Holguin v. DISH Network LLC (2014) 229 Cal.App.4th 1310, 1332.) This inquiry “begins with the ‘lodestar,’ i.e., the number of hours reasonably expended multiplied by the reasonable hourly rate.” (See PLCM Group v. Drexler (2000) 22 Cal.4th 1084, 1095.) From there, the “[t]he lodestar figure may then be adjusted, based on consideration of factors specific to the case, in order to fix the fee at the fair market value for the legal services provided.” (Ibid.) Relevant factors include: “(1) the novelty and difficulty of the questions involved, (2) the skill displayed in presenting them, (3) the extent to which the nature of the litigation precluded other employment by the attorneys, [and] (4) the contingent nature of the fee award.” (Ketchum v. Moses (2001) 24 Cal.4th 1122, 1132.)

The party seeking fees has the burden of documenting the appropriate hours expended and hourly rates. (City of Colton v. Singletary (2012) 206 Cal.App.4th 751, 784.) This burden requires competent evidence as to the nature and value of the services rendered. (Martino v. Denevi (1986) 182 Cal.App.3d 553, 559.)

Merits

Plaintiff’s request for judicial notice

The court grants Plaintiff’s unopposed request for judicial notice of the judgment entered on November 10, 2020, though the court later vacated that judgment.

Plaintiff’s motion is not defective

Defendants argue that Plaintiff’s motion is defective because Plaintiff did not produce an invoice and Plaintiff itself did not provide a declaration to show that the fees were actually incurred or paid. Defendants cite no supporting authority for this specific proposition, and their reliance on Levy v. Toyota Motor Sales, U.S.A., Inc. (1992) 4 Cal.App.4th 807 is unavailing because it stands for different principles, i.e., a party moving for attorney fees has the burden to show the fees were allowable, reasonably necessary, and reasonable, not that they were actually invoiced. In any event, the court can properly base a fee award on the attorney’s declaration, in the absence of time records and billing statements. (Lunada Biomedical v. Nunez (2014) 230 Cal.App.4th 459, 487-488.)

Whether Plaintiff is the prevailing party

Defendants argue that Plaintiff is not the prevailing party because it did not prevail on six of its seven claims in the original complaint. This argument ignores the success Plaintiff achieved throughout this litigation, including most notably its summary adjudication motion. The fact that Plaintiff showed liability through default and a discovery sanction does not discount Plaintiff’s success.

However, independent of the parties’ papers, the court does not believe it can determine Plaintiff as the prevailing party in this action at this time. On January 27, 2021, the court vacated the judgment entered in Plaintiff’s favor on November 10, 2020. Therefore, Plaintiff cannot be deemed the prevailing party. (See Harris v. Wachovia Mortgage, FSB (2010) 185 Cal.App.4th 1018, 1027 [“[T]he award of costs necessarily falls with the judgment.”]; Beard v. Goodrich (2003) 110 Cal.App.4th 1031, 1036 [right to recover attorney fees pursuant to contract established by judgment and extinguished by vacation of judgment]; see also Ducoing Management, Inc. v. Superior Court (2015) 234 Cal.App.4th 306, 314 [“A disposition that reverses a judgment automatically vacates the costs award in the underlying judgment even without an express statement to this effect.”].)

The court is inclined to deny Plaintiff’s motion without prejudice on this basis. However, the court will hear from Plaintiff’s counsel at the hearing whether it should consider the merits or if supplemental briefing is necessary to do so. If the court considers the merits, the court continues as follows.

Plaintiff’s fees are reasonable

Defendants do not challenge any of Plaintiff’s specific fees as unreasonable. Instead, Defendants generally argue that Plaintiff’s litigation strategy in this action was unnecessary. The court rejects this argument. Plaintiff had every right to pursue a motion for summary judgment instead of pursuing a prove-up hearing. It was also reasonable to do so.

The court has considered the sought attorney fees based on the stated tasks and sought rates and do not find them unreasonable in line of the work completed by counsel in this case and counsel’s experience. The court notes that it overrules all of Defendants’ evidentiary objections to the declarations submitted in the motion. The court further notes that although it does not sustain the objections to counsel’s rates determined in the Duckhole, Inc. v. NBCUniversal Media case, this evidence is not bound by the evidence.

Plaintiff is not entitled to its costs

Plaintiff is not entitled to its costs because it did not file a memorandum of costs. (Cal Rules of Court rule 3.1700.)

Conclusion

The court denies Plaintiff’s motion without prejudice.

Plaintiff is to give notice of this ruling.

Dated: ____________________________

Gregory Alarcon

Superior Court Judge

Case Number: BC677815    Hearing Date: September 21, 2020    Dept: 36

 

 

 

Superior Court of California

County of Los Angeles

Department 36

CHUNG & ASSOCIATES, LLC, dba CASHMERE AGENCY,

Plaintiff,

v.

XAVIER RUFFIN, et al.

Defendants.

Case No.: BC677815

Hearing Date: 9/21/2020

[TENTATIVE] RULING RE: Plaintiff’s Motion for Summary Judgment or in the alternative Summary Adjudication

The motion is granted.

Background

Plaintiff Chung & Associates, LLC dba Cashmere Agency (“Cashmere”) is a marketing company that builds advertising campaigns across various industries, including music, art, sports, and fashion. Plaintiff brought the instant actions against two former employees, Defendants Xavier Ruffin (“Ruffin”) and Ricardo Mendoza (“Mendoza”) (collectively “Defendants”). Plaintiff alleges that Defendants unlawfully used confidential and proprietary information in violation of their employee agreements.

This action has a protracted procedural history that the court must explain certain events relevant to this hearing.

On December 27, 2017, Plaintiff filed the operative first amended complaint (“FAC”) asserting two causes of action: (1) breach of contract – violation of confidentiality and non-disclosure agreement; and (2) violation of California Uniform Trade Secrets Act sections 3426 et seq.

On March 13, 2018, Defendants filed a cross-complaint, alleging Plaintiff commenced this action to retaliate against Defendants.

On June 8, 2018, the court granted Plaintiff’s special motion to strike, striking the cross-complaint’s fourth cause of action. Two appeals are currently pending regarding the motion and fees.

On January 9, 2019, the court granted Plaintiff’s motion for terminating sanctions and monetary sanctions in part, by (1) striking Defendants’ answer to the complaint and (2) striking the Defendants’ cross-complaint.

On February 26, 2019, the court denied Defendants’ motion to vacate terminating sanctions.

On March 22, 2019, the court denied Defendants’ motion to reconsider the court’s February 26, 2019 order denying Defendants’ motion to vacate terminating sanctions.

On September 25, 2019, the court granted Plaintiff’s motion for issue sanctions, finding that the damages amount Defendants received from Cashmere’s customers are correct and presumed to be the proper amount of damages.

On October 6, 2019, the court denied Defendants’ motion to reconsider the September 25, 2019 order on issue sanctions.

On June 2, 2020, the court granted Plaintiff’s application to set aside the default and ordered Defendants’ defaults entered on March 28, 2019 vacated. The parties stipulated to set aside default only. The stipulation did not affect Defendants’ answer and cross-complaint, apart from the fourth cause of action. In other words, Defendants’ answer remained stricken.

On June 12, 2020, Plaintiff filed a motion for summary judgment or in the alternative summary adjudication. Plaintiff argues that Defendants’ answer is stricken and therefore Plaintiff is entitled to judgment as a matter of law. Plaintiff argues that the damages amount to $833,188.09.

On September 8, 2020, Defendants opposed.

On September 14, 2020, Plaintiff filed a reply.

Procedural Defects

Both sides have certain procedural defects the court identifies, though the court deems some are fatal and some are harmless.

Plaintiff’s notice of motion and separate statement

Plaintiff’s notice of motion and separate statement violate procedural requirements.

California Rules of Court, rule 3.1350(b) requires a notice of motion for summary adjudication to identify each specific cause of action and claims for damages for which summary adjudication is sought. Here, Plaintiff’s notice of motion does not identify the individual issues.

Code of Civil Procedure section 437c, subdivisions (b)(1) and (f)(2) require a motion for summary judgment and adjudication to include a separate statement of material facts. “If summary adjudication is sought, whether separately or as an alternative to the motion for summary judgment, the specific cause of action, affirmative defense, claims for damages, or issues of duty must be stated specifically in the notice of motion and be repeated, verbatim, in the separate statement of undisputed material facts.” (Cal. Rules of Court, rule 3.1350(b).) This separate statement for summary adjudication also must follow a specific format of identifying the issues in a heading before discussing the material facts. (Id., rule 3.1350(h).) Here, Plaintiff’s separate statement does not identify the issues, which seemingly are each cause of action against each named defendant separately, in violation of these requirements.

However, the court overlooks these procedural defects because Defendants opposed on the merits and there does not appear to be prejudice.

Defendants’ untimely opposition

Plaintiff argues the court should refuse to consider Defendants’ opposition because it is untimely.

Code of Civil Procedure section 437c, subdivision (b)(2) requires opposition papers to a summary judgment motion to be filed and served 14 days before the hearing, unless the court orders otherwise for good cause. The court has discretion to refuse to consider an untimely opposition. ( Rules of Court, rule 3.1300(d).)

There is no dispute that Defendants filed their opposition on September 8, 2020, which is 13 days before the scheduled hearing date of September 21, 2020. Therefore, the opposition is untimely by one calendar day. In making that determination, the court rejects Plaintiff’s argument that the opposition was filed four days late (see reply 5:4) because this conclusion miscalculates the appropriate time even though Plaintiff calculates it correctly elsewhere (ibid.; id. 5:20).

The court is in good position to refuse to consider Defendants’ untimely opposition especially when considering Defendants have repeatedly filed untimely papers in this case and the court has warned Defendants about this conduct multiple times. Nevertheless, the court does consider the opposition because there does not appear to be much prejudice by a one day delay. Plaintiff not only filed a substantive reply on the merits along with evidentiary objections, but filed it on September 14, 2020 instead of the deadline September 16, 2020. (Code Civ. Proc., § 437c(b)(4).)

Defendants’ memorandum of points and authorities exceeds the page limits

Although the court does consider Defendants’ untimely opposition, the court independently notes that Defendants’ memorandum of points and authorities is 24.5 pages long and therefore violates the 20-page limit on memoranda opposing summary judgment motions (Cal. Rules of Court, rule 3.1113(d).) Additionally, the court notes that while the use of single-spaced lines are permissible for the use of quotations (see id. 2.108(3)), Defendants impermissibly use block quotes of certain declarations (see opposition pp. 15-16, 19-21, 23-24) to violate the page limits further. Considering these combined violations, the court exercises its discretion to refuse to consider the pages exceeding the permissible page limits. (Cal. Rules of Court, rule 3.1113(g).) Therefore, the court refuses to consider pages 21-25.

Defendants also violated the requirement to include a table of contents and authorities. (Id., rule 3.1113(f).)

The court reminds Defendants’ counsel the importance of these requirements going forward, including the consequences of certain violations.

Request for Judicial Notice

Plaintiff makes two separate requests for judicial notice, one with its moving papers and the other with its reply papers.

“Judicial notice may not be taken of any matter unless authorized or required by law.” (Evid. Code, § 450.) Evidence Code sections 451 and 452 list matters that are subject to judicial notice. In regard to the documents for which the court grants judicial notice, the court is not mandated to accept the truth of its their contents or the parties’ interpretation of those contents. (Joslin v. H.A.S. Ins. Brokerage (1986) 184 Cal.App.3d 369, 374.)

First, Plaintiff with its moving papers requests the court to take judicial notice of: (Exhibit 1) Plaintiff’s FAC; (Exhibit 2) the court’s January 9, 2019 order granting Plaintiff’s motion for terminating sanctions; and (Exhibit 3) the court’s September 25, 2019 order granting Plaintiff’s motion for issue sanctions.

The court grants Plaintiff’s unopposed request for judicial notice.

Next, Plaintiff with its reply papers requests the court to take judicial notice of 36 documents filed in this action, including motion papers and related orders. It is unclear why Plaintiff did not request judicial notice of these documents with its moving papers and ordinarily a belated request is improper because it violates due process considerations. But here, given that all the documents are documents already filed with the court and the court is already aware of them, the court finds no prejudice to grant this request for judicial notice.

Evidentiary Objections

Both parties object to portions of each other’s evidence.

Defendants’ objections

Defendants object to the Declaration of R. Paul Katrinak (Plaintiff’s counsel), S. Michael Kernan (Plaintiff’s counsel), Seung Chung (Plaintiff’s President), and Karl Schulze (financial expert, who provided opinion on damages calculation).

The court rules as follows.

· R. Paul Katrinak: (general objection to entire declaration) overruled; (1) overruled; (2) overruled; (3) sustained as to what the documents substantively show and overruled as to balance; (4) overruled.

· S. Michael Kernan: (general objection to entire declaration) overruled; (1) sustained; (2) sustained; (3) sustained; (4) sustained; (5) overruled; (6) overruled; (7) sustained; (8) overruled; (9) sustained; (10) overruled; (11) sustained; (12) overruled; and (13) overruled. The court notes that it sustained many objections because of improper legal argument or conclusions.

· Seung Chung: (general objection to entire declaration) overruled; (1) overruled; (2) overruled; (3) overruled; (4) overruled; (5) overruled; (6) overruled; (7) overruled; (8) overruled; (9) overruled; (10) overruled; (11) overruled; (12) overruled; (13) overruled; (14) overruled; (15) overruled; (16) overruled; (17) sustained as to legal conclusion (“in breach of their contracts and in violation of the law”) and overruled as to balance; (18) overruled; (19) overruled; (20) overruled; (21) overruled; (22) sustained; (23) sustained; (24) sustained; (25) sustained; (26) sustained; (27) sustained as to legal conclusion (the court’s determination on previous applications) and overruled as to balance (Defendants’ actions); (28) overruled; and (29) overruled.

· Karl Schulze: (general objection to entire declaration) overruled; (1) sustained; (2) sustained; (3) overruled; (4) overruled; (5) overruled; (6) overruled; (7) sustained; (8) sustained; (9) overruled; (10) overruled; (11) overruled; and (12) overruled. As to objections no. 8, the court notes that the opinion expressed is too conclusory and not supported with sufficient reasoning as to the factual basis, i.e., what “evidence” provided the ultimate determination on the amounts. (Kelley v. Trunk (1998), 66 Cal.App.4th 519, 524; see also Fernandez v. Alexander (2019) 31 Cal.App.5th 770, 781.) Schulze sets forth proper reasoning how he would ultimately come to his conclusion. (See Schulze Decl. ¶¶ 8-9.) Additionally, Schulze identifies certain evidence helpful to his determination, i.e., no reduction in the amount for overhead costs and no new employees. (Id. ¶ 11.) However, Schulze does not explain how he reached the critical determination that the amount earned by Defendants totals $833,188.09; in other words, Schulze does not identify what evidence provides that number. (Id. ¶ 10.) Therefore, the court sustains the objections as to the ultimate conclusion and the reasonableness of the calculation of the damages.

Plaintiff’s objections

Plaintiff objects to the Declaration of Jane Lee (Plaintiff’s former Social Media Sr. Account Manager), Kurt Graver (Netflix’s employee), Theresa Moctezuma (Plaintiff’s former employee), Mickey Ferri, PhD (financial expert, who provided opinion inter alia on damages calculation), Tommy Gomez (entertainment expert), Xavier Ruffin, and Ricardo Mendoza. Plaintiff’s objections are not numbered in violation of the California Rules of Court. See Cal. Rules of Court, rule 3.1354(b) [“Each written objection must be numbered consecutively . . . .”]. Nevertheless, the court rules on the objections as follows.

As a preliminary matter, Plaintiff requests the court to exclude the declarations because the court struck Defendants’ answer and therefore they are irrelevant. The court rejects this request. Plaintiff relies on authorities relevant for the production of evidence at trial, not a summary judgment motion. Additionally, Plaintiff fails to specifically identify what specific evidence or deposition testimony that were withheld are now being presented in opposition. A mere generic summary of the past discovery abuses is insufficient.

To the extent that Plaintiff argues the court should exclude the declarations because they contradict a judicial admission (by way of the stricken answer), the court rejects this argument because whether the information is otherwise admissible is not affected by the stricken answer. Instead, the stricken answer’s allegations as admitted show that there is no issue of fact on those facts, not whether the evidence proffered is inadmissible

Finally, to the extent that Plaintiff makes general objections to the entirety of the declarations on the basis of foundation, hearsay, and improper opinion, such objections are not properly made on the entire declarations for the court to rule on. (See Cal. Rules of Court, rule 3.1354(c) [place for ruling on the objection required].)

The court rules on the specific objections as follows:

· Jane Lee: (1 – referring to ¶ 3) overruled; (2 – referring to ¶ 4) overruled; (3 – referring to ¶ 5) sustained; (4 – referring to ¶ 6) sustained; (5 – referring to ¶ 7) overruled; (6 – referring to ¶ 8) sustained; (7 – referring to ¶ 9) overruled; (8 – referring to ¶ 10) overruled; (9 – referring to ¶ 11) overruled; and (10 – referring to ¶ 12) sustained.

· Kurt Graver: (1 – referring to ¶ 3) overruled; (2 – referring to ¶ 4) sustained as to whether his contact information “is not a trade secret” and overruled as to balance; (3 – referring to ¶ 5) overruled; (4 – referring to ¶ 6) overruled; (5 – referring to ¶ 7) overruled; (6 – referring to ¶ 8) overruled; (7 – referring to ¶ 9) overruled; (8 – referring to ¶ 10) overruled; (9 – referring to ¶ 11) overruled; (10 – referring to ¶ 12) overruled; (11 – referring to ¶ 13) overruled; and (12 – referring to ¶ 14) overruled.

· Theresa Moctezuma: (1 – referring to ¶ 3) overruled; (2 – referring to ¶ 4) overruled; (3 – referring to ¶ 5) sustained; (4 – referring to ¶ 6) overruled whether Plaintiff was “regularly understaffed and had difficulty completing projects” and sustained as to balance; (5 – referring to ¶ 7) overruled; (6 – referring to ¶ 8) overruled; (7 – referring to ¶ 9) overruled; and (8 – referring to ¶ 10) sustained.

· Mickey Ferri, PhD: (1 – referring to ¶ 4) overruled; (14 – referring to ¶ 21) overruled; (20 – referring to ¶ 24) overruled; (28 – referring to ¶ 32) overruled; (29– referring to ¶ 33) sustained as to what Cashmere admits and overruled as to balance; (30 – referring to ¶ 34) sustained; (31 – referring to ¶ 36) overruled; (32 – referring to ¶ 37) overruled; (34 – referring to ¶ 39) overruled. The court does not rule on the following objections because they are immaterial to the motion’s disposition pursuant to Code of Civil Procedure section 437c, subdivision (q): (2 – referring to ¶ 5); (3 – referring to ¶ 6); (4 – referring to ¶ 7); (5 – referring to ¶ 8); (6 – referring to ¶ 9); (7 – referring to ¶ 10); (8 – referring to ¶ 11); (9 – referring to ¶ 12); (10 – referring to ¶ 13); (11 – referring to ¶ 14); (12 – referring to ¶ 15); (13 – referring to ¶ 16); (14 – referring to ¶ 17); (15 – referring to ¶ 18); (16 – referring to ¶ 19); (17 – referring to ¶ 20); (18 – referring to ¶ 22); (19 – referring to ¶ 23); (21 – referring to ¶ 25); (22 – referring to ¶ 26); (23 – referring to ¶ 27); (24 – referring to ¶ 28); (25 – referring to ¶ 29); (26 – referring to ¶ 30); (27 – referring to ¶ 31); (31 – referring to ¶ 35); (33 – referring to ¶ 38); and (35 – referring to ¶ 40).

· Tommy Gomez: (1 – referring to ¶ 4) overruled; (2 – referring to ¶ 5) overruled as to Gomez’ qualifications and sustained as to balance; (9 – referring to ¶ 12) overruled; (10 – referring to ¶ 13) overruled. The court does not rule on the following objections because they are immaterial to the motion’s disposition pursuant to Code of Civil Procedure section 437c, subdivision (q): (3 – referring to ¶ 6); (4 – referring to ¶ 7); (5 – referring to ¶ 8); (6 – referring to ¶ 9); (7 – referring to ¶ 10); (8 – referring to ¶ 11); (10 – referring to ¶ 14); (11 – referring to ¶ 15); (12 – referring to ¶ 16); (13 – referring to ¶ 17); (14 – referring to ¶ 18); (15 – referring to ¶ 19); (16 – referring to ¶ 20); (17 – referring to ¶ 21)

· Xavier Ruffin: (1 – referring to ¶ 4) overruled; (2 – referring to ¶ 5) overruled; (3 – referring to ¶ 6) overruled; (4 – referring to ¶ 7) overruled; (5 – referring to ¶ 8) overruled; (6 – referring to ¶ 9) overruled; (7 – referring to ¶ 10) sustained as to Kurt Graver’s deposition testimony’s contents and overruled as to balance; (8 – referring to ¶ 11) overruled; (9 – referring to ¶ 12) overruled; (10 – referring to ¶ 13) overruled; (11 – referring to ¶ 14) overruled; (12 – referring to ¶ 15) overruled; (13 – referring to ¶ 16) overruled; (14 – referring to ¶ 17) overruled; (15 – referring to ¶ 18) overruled; (16 – referring to ¶ 19) overruled; (17 – referring to ¶ 20) overruled; (18 – referring to ¶ 21) overruled; (19 – referring to ¶ 22) overruled; (20 – referring to ¶ 23) overruled; and (21 – referring to ¶ 24) overruled.

· Ricardo Mendoza: (1 – referring to ¶ 3) overruled; (2 – referring to ¶ 6) overruled; (3 – referring to ¶ 5) overruled; (4 – referring to ¶ 8) overruled; (5 – referring to ¶ 9) sustained as to characterization of pitch desk as not a trade secret and overruled as to balance; (6 – referring to ¶ 10) overruled; (7 – referring to ¶ 11) overruled; (8 – referring to ¶ 12) overruled; (9 – referring to ¶ 13) overruled; (10 – referring to ¶ 14) overruled; (11 – referring to ¶ 15) sustained as to Kurt Graver’s deposition testimony’s contents and overruled as to balance; (12 – referring to ¶ 16) overruled; (13 – referring to ¶ 17) overruled; (14 – referring to ¶ 18) overruled; (15 – referring to ¶ 19) overruled; (16 – referring to ¶ 20) overruled; (17 – referring to ¶ 21) sustained; (18 – referring to ¶ 22) sustained; (19 – referring to ¶ 23) overruled; (20 – referring to ¶ 24) overruled; (21 – referring to ¶ 25) overruled; (22 – referring to ¶ 26) overruled; (23 – referring to ¶ 27) overruled; (24 – referring to ¶ 28) overruled; (25 – referring to ¶ 29) overruled; (26 – referring to ¶ 30) overruled; (27 – referring to ¶ 31) overruled; (28 – referring to ¶ 32) overruled; (29 – referring to ¶ 33) overruled; (30 – referring to ¶ 34) overruled; (31 – referring to ¶ 35) overruled; (32 – referring to ¶ 36) overruled; (33 – referring to ¶ 37) overruled; (34 – referring to ¶ 38) sustained as to characterization as a “ploy” and “lie” and overruled as to balance; (35 – referring to ¶ 39) overruled; (36 – referring to ¶ 40) overruled; (37 – referring to ¶ 41) overruled; (38 – referring to ¶ 42) sustained as to characterization as “not trade secrets” and overruled as to balance; (39 – referring to ¶ 43) sustained as to characterization as “not trade secrets” and overruled as to balance; and (40 – referring to ¶ 44) sustained.

Facts

Plaintiff sets forth 18 undisputed material facts (“UMF”) in support of its motion. Defendants dispute all of them.

Plaintiff hired Defendants and pursuant to an agreement, Defendants were not permitted to disclose or use any confidential, sensitive, or proprietary information except for the benefit of Plaintiff and that information. (UMF ¶¶ 1-2, 5-6.) Although Defendants contend otherwise, Plaintiff contends that Defendants breached their employment agreements by disclosing and entering into employment contracts with Plaintiff’s clients based on Plaintiff’s trade secrets. (Id. ¶¶ 3, 7.) Similarly, the parties dispute whether Defendants improperly used Plaintiff’s trade secrets. (Id. ¶¶ 11-12, 16-17.) Based on this breach and misappropriation of trade secrets, Plaintiff contends that it suffered harm by losing profits in the amount of $833,188.09. (Id. ¶¶ 4, 8, 18.)

Legal Authority

The purpose of a motion for summary judgment or summary adjudication “is to provide courts with a mechanism to cut through the parties’ pleadings in order to determine whether, despite their allegations, trial is in fact necessary to resolve their dispute.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843 (Aguilar).) “Code of Civil Procedure section 437c, subdivision (c), requires the trial judge to grant summary judgment if all the evidence submitted, and ‘all inferences reasonably deducible from the evidence’ and uncontradicted by other inferences or evidence, show that there is no triable issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” (Adler v. Manor Healthcare Corp. (1992) 7 Cal.App.4th 1110, 1119.)

“In ruling on the motion, the court must consider all of the evidence and all of the inferences reasonably drawn therefrom [citation] and must view such evidence [citations] and such inferences [citations] in the light most favorable to the opposing party.” (Aguilar, supra, 25 Cal.4th at pp. 844-845, quotation marks omitted.)

“On a motion for summary judgment, the initial burden is always on the moving party to make a prima facie showing that there are no triable issues of material fact.” (Scalf v. D. B. Log Homes, Inc. (2005) 128 Cal.App.4th 1510, 1519.)

A plaintiff moving for summary judgment or summary adjudication “has met his or her burden of showing that there is no defense to a cause of action if that party has proved each element of the cause of action entitling the party to judgment on the case of action.” (Code Civ. Proc., § 437c, subd. (p)(1).) “Once the plaintiff . . . has met that burden, the burden shift to the defendant . . . to show that a triable issue of one or more material facts exists as to the cause of action or a defense thereto.” (Ibid.)

Discussion

The vast majority of the case has already been decided in earlier motion practice, which resulted in the court striking Defendants’ answer and the court granting an issue sanction. The only thing that remains is the issue of damages because all of Plaintiff’s allegations in the FAC are deemed admitted. (Code Civ. Proc., § 431.20; see also Bucur v. Ahmad (2016) 244 Cal.App.4th 175, 187.) Defendants otherwise overlook that the stricken answer satisfies Plaintiff’s obligation to meet its prima facie case and nothing more is needed. (See opposition 1:24-26 [“The answer being stricken does not relieve or alleviate Cashmere from its obligation to make the prima facie case for its contractual and trade secret claims.”].)

Therefore, the issues of whether Plaintiff had trade secrets and whether Defendants misappropriated the trade secrets are not before the court. Additionally, the issue of whether Defendants’ misconduct caused Plaintiff to lose business (as opposed to Defendants obtaining the business with information that is either not trade secrets or through other means) is an issue relating to causation, which is also admitted as true based on the Defendants’ stricken answer. In other words, Defendants have admitted, by the striking of their answer, that Plaintiff’s damages were proximately caused by Defendants’ conduct. Instead, the only remaining issue is how much damages exist. The question is how much money Defendants made from Plaintiff’s confidential client contacts and other information.

Damages for breach of contract for lost profits and misappropriation of trade secrets are informed by Judicial Council of California Civil Jury Instruction (“CACI”) 3903N and 4409 respectively.

CACI 3903N provides as follows:

To recover damages for lost profits, [name of plaintiff] must prove it is reasonably certain [he/she/nonbinary pronoun/it] would have earned profits but for [name of defendant]'s conduct.

To decide the amount of damages for lost profits, you must determine the gross amount [name of plaintiff] would have received but for [name of defendant]'s conduct and then subtract from that amount the expenses [including the value of the [specify categories of evidence, such as labor/materials/rents/all expenses/interest of the capinline.instr employed]] [name of plaintiff] would have had if [name of defendant]'s conduct had not occurred.

The amount of the lost profits need not be calculated with mathematical precision, but there must be a reasonable basis for computing the loss.

CACI 4409 provides as follows:

If [name of plaintiff] proves that [name of defendant] misappropriated [his/her/nonbinary pronoun/its] trade secret[s], then [name of plaintiff] is entitled to recover damages if the misappropriation caused [[name of plaintiff] to suffer an actual loss/ [or] [name of defendant] to be unjustly enriched].

[If [name of defendant]'s misappropriation did not cause [[name of plaintiff] to suffer an actual loss/ [or] [name of defendant] to be unjustly enriched], [name of plaintiff] may still be entitled to a reasonable royalty for no longer than the period of time the use could have been prohibited. However, I will calculate the amount of any royalty.]

Plaintiff definitively states that the amount is approximately $833,188.09. In support of this amount, Plaintiff cites the deposition testimony of Keith Wilson and the authenticated response by Netflix pursuant to its subpoenas. (Katrinak Decl. Ex. B, C.) Notably, the response to the subpoena shows a payment totaling of $833,188.09 to Cynosure Creative Agency, operated by Defendants.

This information is enough for Plaintiff to meet its initial burden on the amount under a lost profits theory, even though the court rejects Plaintiff’s expert opinion because it fails to explain how he arrived at this number. The burden now shifts to Defendants. While Defendants focus on liability, they do not focus much on damages, at least in the parts of the memorandum within the page limit requirements. However, Defendants do show there is a triable issue of fact regarding the lost profits because of the issue of Plaintiff’s expenses. While Plaintiff contends that there are no increased expenses because it would have paid the same staff the same amount (Chung Decl. ¶ 19), the court agrees that there is a triable issue of fact whether Plaintiff would have had to hire more staff based on previously working at maximum capacity (Lee Decl. ¶ 7, Moctezuma Decl. ¶ 6), thus increasing its expenses, for the business Defendants took from Plaintiff. In making this finding, the court notes that it must take the evidence in the light most favorable to Defendants as the opposing party even if the court has already found that plaintiff makes is prima facie case on everything but damages.

Nevertheless, Plaintiff seeks damages under an unjust enrichment theory as well. Here, it is clear that Defendants received $833,188.09. Therefore, Plaintiff meets its initial burden showing that Defendants were unjustly enriched by that amount, notwithstanding that amount should be further reduced by Defendants’ reasonable expenses as unspecified by Plaintiff. (CACI 4401.) In attempting to rebut that shifted burden on this issue, Defendants argue that this amount was given for unrelated projects where Kurt Graver was not the account contact. This argument ignores that the misappropriation of trade secrets, as admitted by Defendants’ stricken answer, is not limited to a single contact, but captures taking all the business opportunities away. (FAC ¶ 18.) Defendants do not state any evidentiary proof regarding their reasonable expenses that would otherwise reduce the amount for unjust enrichment. In making this finding, the court notes that Defendants’ expert claims knowledge of the expenses based on inadmissible interviews with Defendants. (See Ferri Decl. ¶¶ 32-33.) This is not admissible evidence to create a triable issue of fact necessitating a trial on the exact amount. Defendants do not otherwise identify any other evidence on this issue. Accordingly, the court grants summary adjudication on the issue of damages in the amount of $833,188.09 for misappropriation of trade secrets based on unjust enrichment.

Finally, because all allegations of the FAC are deemed true, Defendants conduct was willful and malicious. (FAC ¶ 33.) This finding supports an award of attorney fees to Plaintiff as a prevailing party pursuant to Civil Code section 3426.4. The court grants summary adjudication on this issue, finding that Plaintiff is entitled to attorney fees pursuant to a subsequent motion. In so doing, the court reminds Plaintiff not to double count any fees already awarded in previous motion practice, e.g., sanctions motions.

Conclusion

The court denies Plaintiff’s motion for summary judgment.

The court grants Plaintiff’s motion in the alternative for summary adjudication by finding that: (1) Plaintiff is to be awarded $833,188.09 in damages for misappropriation of trade secret based on unjust enrichment; and (2) Plaintiff is entitled to attorney fees for Defendants’ willful and malicious conduct to Plaintiff as a prevailing party pursuant to Civil Code section 3426.4.

Plaintiff to give notice of this ruling and prepare a proposed judgment.

Dated: ____________________________

Gregory Alarcon

Superior Court Judge

Case Number: BC677815    Hearing Date: July 25, 2020    Dept: 36

 

 

Superior Court of California

County of Los Angeles

Department 36

CHUNG & ASSOCIATES, LLC, dba CASHMERE AGENCY,

Plaintiff,

v.

XAVIER RUFFIN, et al.

Defendants.

Case No.: BC677815

Hearing Date: 7/24/2020

[TENTATIVE] RULING RE: Plaintiff’s Motion for Sanctions

The motion is denied.

Motion for Sanctions

Plaintiff Chung & Associates, LLC dba Cashmere Agency move for monetary sanctions against Defendants Xavier Ruffin and Ricardo Mendoza, and their counsel, Michael A. Long, for violation of this court’s orders. Plaintiff asserts Defendants have abused the discovery process by trying to block Plaintiff’s discovery with respect to Plaintiff’s subpoena of Netflix, and by opposing Plaintiff’s discovery on trade secrets on improper grounds.

Notice of Motion

A request for a sanction shall, in the notice of motion, identify every person, party, and attorney against whom the sanction is sought, and specify the type of sanction sought.” (Code Civ. Proc., § 2023.040.)

As an initial matter, Plaintiff’s Notice of Motion requests monetary sanctions against Defendants and their counsel, and does not request the court to relieve the discovery referee appointed in this case. This request is located on the last page of Plaintiff’s Memorandum of Points and Authorities. The court thus does not relieve the discovery referee as a sanction.

In addition, Plaintiff’s Notice of Motion does not request the court overrule Defendants’ unspecified motion relating to trade secrets. (See Mot. at pp. 7-8.) The court thus does not overrule Defendants’ unspecified motion as a sanction.

Notice – Proof of Service

Defendants assert Plaintiff’s motion for sanctions was improperly served as only an attached exhibit to its ex parte motion of February 10, 2020.

Plaintiff’s proof of service contains a declaration of service, attesting to service of the motion by mail, by depositing the mail with postage prepaid on February 10, 2020. This declaration created a rebuttable presumption that the notice had been received in the ordinary course of mail. (Evid. Code § 641; see Bonzer v. City of Huntington Park (1993) 20 Cal.App.4th 1474.) The effect of the presumption is that the other side must produce evidence supporting a finding of its nonexistence. (Evid. Code § 604.) Defendants have not provided evidence in support that the motion was improperly served.

The court thus does not deny Plaintiff’s motion on this ground.

 

Safe Harbor Provision

Defendants assert Plaintiff has not complied with the safe harbor provisions for Plaintiff’s motion. The 21-day safe harbor provision applies to motions for sanctions under Code of Civil Procedure section 128.5 only when the alleged action is “the making or opposing of a written motion or the filing and service of a complaint, cross-complaint, answer, or other responsive pleading that can be withdrawn or appropriately corrected . . . .” (CCP § 128.5(f)(1)(B).)

Plaintiff’s motion is on grounds of violation of court orders related to discovery. Accordingly, the 21-day safe harbor provision under this subdivision of Code of Civil Procedure section 128.5 does not apply.

Plaintiff’s motion filed February 10, 2020 originally set for hearing on March 5, 2020, is thus timely under CCP § 1005.

 

Order of March 16, 2020

As an initial matter, the court notes that the practical aspect of most discovery issues in this motion were largely resolved by the court’s order of March 16, 2020 on Plaintiff’s Motion to Compel Deposition, which provided for Plaintiff’s discovery on Netflix, and ruled discovery was still open and discovery cut-off dates were based on the new trial date.

Requested Sanctions

Plaintiff’s notice of motion identifies numerous statutes under which it seeks sanctions: Code of Civil Procedure sections 128.5, 177.5, 575.2, and 2023.030, et seq.; California Rules of Court, Rule 2.30; and Govt. Code Section 68608.

 

Code of Civil Procedure Sections 128.5, 177.5, 575.2, 2023.030

Under CCP § 128.5, a court may impose sanctions for a party to pay the reasonable expenses including attorney’s fees incurred by another party as a result of actions or tactics made in bad faith that are frivolous or solely intended to cause unnecessary delay. (CCP § 128.5(a).) Though not noted by the parties, this provision “shall not apply to disclosures and discovery requests, responses, objections, and motions.” (Id. at (e).) Plaintiff essentially asserts Defendants have raised frivolous arguments in response to discovery. (Mot. at p. 8.) Considering the totality of the circumstances in this case, and Plaintiff’s argument relating to discovery, the court declines to award sanctions pursuant to CCP § 128.5.

Under CCP § 177.5, a court may impose money sanctions for violation of a court order not exceeding $1,500, payable to the court. As noted in this court’s prior ruling, Plaintiff seeks sanctions of $4,560.00 in excess of section 177.5’s limit. Next, Plaintiff’s motion has no argumentation on the applicability of this provision or in support of sanctions under it. Based on the foregoing, the court declines to award sanctions pursuant to CCP § 177.5.

Under CCP § 575.2, a court may impose sanctions against party’s counsel for violating a court’s local rules that were promulgated to facilitate the business of the court. Plaintiff’s motion identifies a violation of Local Rule Appendix 3.A, without specifying any particular rule under the Appendix, or argumentation on the applicability of this provision or in support of sanctions under it. Based on the foregoing, the court declines to award sanctions pursuant to CCP § 575.2.

Under CCP § 2023.030, a court may order a monetary sanction based on a misuse of the discovery process. As stated in this court’s prior order, the Hon. Jeffrey King (Ret.) has been appointed as referee for all discovery matters, and Plaintiff’s request to relieve the discovery referee has been denied. Based on the foregoing, the court declines to award sanctions pursuant to CCP § 2023.030.

Cal. Rules of Court, Rule 2.30

Under California Rules of Court, Rule 2.30(a)-(b), the court may impose sanctions for violations of the Rules. As with Plaintiff’s prior motion for sanctions, Plaintiff does not identify in its motion or notice of motion which CRC Rule was violated by Defendants, nor argumentation in support.

Govt. Code Section 68608

Under California Government Code section 68608, subdivision (b), the court may impose sanctions authorized by law if it appears less severe sanctions would not be effective, to achieve the purposes of the Trial Court Delay Reduction Act. (Gov. Code, § 68608(b).) Again, Plaintiff’s motion has no argumentation on the applicability of this provision or in support of sanctions under it. In light of the upcoming trial the court declines to award sanctions under this provision.

Dated: ____________________________

Gregory Alarcon

Superior Court Judge