Judge Curtis A. Kin, Case 19STCV38577 2023-02-14 Tentative Ruling

Judge: Curtis A. Kin, Case: 19STCV38577, Date: 2023-02-14 Tentative Ruling

Case Number: 19STCV38577 Hearing Date: February 14, 2023 Dept: 72

MOTIONS TO COMPEL FURTHER RESPONSES TO REQUESTS FOR PRODUCTION, SET FOUR

Date: 2/14/23 (9:30 AM)

Case: Western Diocese of the Armenian Church v. Taglyan (19STCV38577)

TENTATIVE RULING:

Defendant Petros Taglyan’s Motion to Compel Further Responses to Requests for Production, Set Four is GRANTED IN PART.

Defendant Petros Tagylan filed a motion for an order to: (1) compel plaintiff Western Diocese of the Armenian Church of North America (“Diocese”) to serve further responses to Requests for Production, Set Four, Nos. 132-143, 145-156, and 162-164; and (2) compel plaintiff St. John Armenian Apostolic Church Hollywood, California (“Church”) to serve further responses to Requests for Production, Set Four, Nos. 140-151, 158-160, and 166-168.

After the filing of the instant motion, plaintiff Diocese served further responses to Nos. 132-135, 137, 139, 142 and 146, and plaintiff Church served further responses to Nos. 140-143, 145, 148 and 150. (Alexander Decl. ¶ 6 & Ex. D.) To avoid future motion practice, the Court has reviewed the supplemental responses to determine whether they are sufficient. (Sinaiko Healthcare Consulting, Inc. v. Pacific Healthcare Consultants (2007) 148 Cal.App.4th 390, 409 [court has discretion to review discovery responses served after filing of motion to compel initial response].) In the most recent supplemental responses, plaintiffs state that responsive documents are no longer in their possession, custody, or control. Plaintiffs also state the organization that they believe may have possession, custody, or control of the requested documents. These responses comply with CCP § 2031.230. No further responses from Diocese to Nos. 132-135, 137, 139, 142 and 146 or from Church to Nos. 140-143, 145, 148 and 150 are required.

With respect to Nos. 140 and 147 to Diocese, which ask for all documents regarding funds transferred out of the specified Citibank account to any of Diocese’s accounts, Diocese states that it believes Church has the requested documents. Defendant states that Diocese should be ordered to obtain the requested documents from Church. However, Diocese is entitled to contend in discovery that it does not have the requested documents. Diocese is also entitled under CCP § 2031.230 to set forth the name of the organization it believes has possession, custody, or control of the requested documents.

Also, with respect to Nos. 140 and 147, as well as Nos. 136, 138, 141, 143, 145, and 164, to Diocese, Diocese states that it is unable to comply with the requests “as the items sought are not in its possession, custody or control.” That response does not comply with CCP § 2031.230, because Diocese does not state whether the requested documents have “never been” or are “no longer” in its possession, custody, or control. The statute does not allow Diocese to state merely that responsive documents are not in its possession, custody, or control without specifying whether such documents ever were in their possession, custody, or control. Further responses from Diocese to Nos. 136, 138, 140, 141, 143, 145, 147, and 164 are thus required.

With respect to defendant’s contention that the Bates stamp numbers referenced in Church’s responses to Nos. 144, 146, 147, 149, and 151 correspond to documents that do not pertain to the request, the Court notes that defendant seeks “all documents regarding” the opening and closing of a Citibank account (No. 144), any funds transferred out of the Citibank account (No. 146), any checks from the Citibank account that were deposited to other accounts (No. 147), the opening and closing of a Building Fund Account (No. 149), and any accounts into which funds from the Citibank account were transferred (No. 151). Defendant contends that the Bates stamp numbers cited do not all relate to the requested documents. Defendant, however, choose to use the word “regarding” in its requests and accordingly may not prevent Church from citing the documents the Church contends are responsive, even if defendant views certain documents as non-responsive. Defendant’s citation to Deyo v. Kilbourne (1978) 84 Cal.App.3d 771, 784 for the assertion that “[a] broad statement that the information is available from a mass of documents is insufficient” is unavailing, as this principle pertains to responses to an interrogatory pursuant to what is now CCP § 2030.240.

Further, with respect to defendant’s contention that Church’s production for Nos. 146, 147, and 151 was incomplete, the Church is entitled to claim that it has produced all responsive documents in its possession, custody, or control. (See CCP § 2031.220.) If defendant unearths evidence that Church has intentionally withheld responsive documents, defendant may seek relief to which he believes he is entitled at that time, including a jury instruction for willful suppression of evidence and/or other appropriate sanction(s).

Notwithstanding the foregoing, with respect to Nos. 144, 146, 147, 149, 151, and 168 to Church, Church states that it will produce “all responsive non-privileged documents in its possession, custody or control….” Because Church states it will produce “non-privileged” documents, defendant cannot determine whether Church is withholding documents based on the attorney-client privilege or the attorney work product doctrine. Further responses from Church to Nos. 144, 146, 147, 149, 151, and 168 are thus required. Church must serve a privilege log in connection with defendant’s Requests for Production, Set Four. (See Catalina Island Yacht Club v. Superior Court (2015) 242 Cal.App.4th 1116, 1130, citing CCP § 2031.240(b), (c) and Wellpoint Health Networks, Inc. v. Superior Court (1997) 59 Cal.App.4th 110, 130 [requirements for privilege log].) If Church wishes to withdraw objections based on the attorney-client or work product doctrine to any document requests, then Church may serve verified supplemental responses with the objections withdrawn and produce documents that were withheld based on privilege. Any produced documents shall identify the document request to which the documents respond, as required by CCP § 2031.280(a).

With respect to Nos. 148-153 to Diocese, these requests seek balance sheets (No. 148), internal financial statements (No. 149), audited financial statements (No. 150), general accounting ledgers and reports (No. 151), income and expense statements (No. 152), and profit and loss statements (No. 153), all for the period from January 1, 2003 through the present. Defendant maintains the requested financial documents are probative of Diocese’s allegation that due to defendant’s misuse of the Building Fund Account, Diocese has been “saddled with the operational costs” of Church, including utility bills, legal costs, property tax, mortgage payments, etc. (SAC ¶¶ 81, 89, 101.)

Defendant, however, does not dispute the contention that Diocese manages 47 parishes. The requested financial documents thus pertain to not only Church but also 46 other parishes. Defendant fails to provide sufficient explanation of how financial information related to other parishes is probative of Diocese’s damages arising from the operational costs of Church. The operational or construction costs of other parishes would appear on its face not relevant to the operational costs of Church that Diocese allegedly incurred.

“A right of privacy exists as to a party's confidential financial affairs, even when the information sought is admittedly relevant to the litigation.” (Weil & Brown, Cal. Practice Guide: Civil Procedure Before Trial, ¶ 8:303, citing Cobb v. Superior Court (1979) 99 Cal.App.3d 543, 550.) While corporations’ right to privacy does not arise from the California Constitution, corporations nevertheless have a privacy right that must be balanced against the need for discovery. (SCC Acquisitions, Inc. v. Superior Court (2015) 243 Cal.App.4th 741, 756 [“The discovery’s relevance to the subject matter of the pending dispute and whether the discovery ‘ “appears reasonably calculated to lead to the discovery of admissible evidence” ’ is balanced against the corporate right of privacy”].)

Thus, given that defendant has not sufficiently explained how financial information concerning 46 other parishes is probative of Diocese’s damages concerning Church, especially for a twenty-year period, defendant’s right to conduct discovery is outweighed by Diocese’s corporate privacy right. To the extent plaintiffs have not provided any documents supporting Diocese’s claim for operational costs related to Church, defendant can propound more tailored discovery to obtain those documents. No further responses from Diocese to Nos. 148-153 are required.

With respect to No. 154 to Diocese and No. 158 to Church, these requests ask for documents sufficient to identify plaintiffs’ accounting firms, accountants, or bookkeepers from January 1, 2003 through the present. As the requests are phrased, no privacy rights or privileges are implicated. The twenty-year scope of the requests is relevant because the events alleged by plaintiffs began in 2003. (SAC ¶¶ 13-16.) Considering that plaintiffs seek monetary damages arising from their operations, or inability to operate (SAC ¶¶ 81, 89, 101), the accounting firms, accountants, or bookkeepers are witnesses. “Central to the discovery process is the identification of potential witnesses.” (Puerto v. Superior Court (2008) 158 Cal.App.4th 1242, 1249.) Further responses from Diocese to No. 154 and from Church to No. 158 are required.

With respect to Nos. 155 and 156 to Diocese and Nos. 159 and 160 to Church, these requests seek documents sufficient to identify plaintiffs’ Taxpayer Identification Numbers (“TIN”) and Employer Identification Numbers (“EIN”) from January 1, 2003 to the present. Defendant asserts the TINs and EINs are relevant to determining the ownership of bank accounts at issue in the instant action, and the Court agrees. Archpriest Manoug Markarian, for example, testified that Church used a TIN to open a bank account at issue. (Lode Decl. ¶ 6 & Ex. D at 96:9-23, 98:12-21.)

Plaintiffs, however, maintain that defendant seeks their Internal Revenue Service identification numbers, which are purportedly privileged in plaintiffs’ view. The California Supreme Court has held that tax returns are privileged and protected from forced disclosure in civil actions. (See Webb v. Standard Oil Co. of Cal. (1957) 49 Cal.2d 509, 513; Schnabel v. Superior Court (1993) 5 Cal.4th 704, 721.) “The purpose of the privilege [against disclosing tax returns] is to encourage voluntary filing of tax returns and truthful reporting of income, and thus to facilitate tax collection.” (Weingarten v. Superior Court (2002) 102 Cal.App.4th 268, 274.) The TIN and EIN, however, do not themselves contain any information about income, profits, losses, expenditures set forth in any tax return, which is protected under Revenue and Tax Code § 7056(a).

Accordingly, further responses from Diocese to Nos. 155 and 156 and Church to Nos. 159 and 160 are required. Other than the TINs or EINS, plaintiffs may redact other information in the responsive documents they contend is protected under the tax return privilege, so long as plaintiffs also serve a corresponding privilege log containing “sufficient factual information for [defendant] and court to evaluate whether the claim [of privilege] has merit.” (Catalina Island, 242 Cal.App.4th at 1130.)

With respect to Nos. 162 and 163 to Diocese and Nos. 166 and 167 to Church, these requests seek all building committee meeting minutes (No. 162 to Diocese and No. 166 to Church) and all documents regarding plaintiffs’ building committee (No. 163 to Diocese and No. 167 to Church) from January 1, 2003 to the present. Plaintiffs maintain that these requests are duplicative of previously served discovery.

Defendant already sought building committee meeting minutes for the same time period in Request for Production, Set Three, No. 93 to Diocese and Request for Production, Set Three, No. 105 to Church, the disputes to which were resolved during the discovery motion heard on January 31, 2023. Accordingly, no further responses to No. 162 to Diocese and No. 166 to Church are required.

As for No. 163 to Diocese and No. 167 to Church, Request for Production, Set Three, No. 92 to Diocese and Request for Production, Set Three, No. 104 to Church sought annual reports of plaintiffs’ building committees from January 1, 2003 to the present. (Alexander Decl. ¶ 10 & Ex. H.) No. 163 to Diocese and No. 167 to Church, however, are broader in that they seek “all documents regarding” plaintiffs’ building committees. Defendant maintains that the documents are relevant to defendant’s alleged promise to pay for the construction of Church, as well as defendant’s oversight over the construction. (SAC ¶¶ 21, 91, 92.) While that may be true, the requested documents pertain to more than just Church. As phrased, the requests are not reasonably calculated to lead to admissible evidence. (See CCP § 2017.010.) The requests for 20 years of documents are not limited based on subject matter. (Calcor Space Facility, Inc. v. Superior Court (1997) 53 Cal.App.4th 216, 221 [discovery devices “should be well calibrated; the lancet is to be preferred over the sledge hammer”].) Defendant provided no basis upon which the requests can be limited. Thus, no further responses to No. 163 to Diocese and No. 167 to Church are required.

For all the foregoing reasons, the motion is GRANTED IN PART. Within fifteen (15) days hereof, plaintiff Western Diocese of the Armenian Church of North America shall serve further verified responses, without objection, to Requests for Production, Set Four, Nos. 136, 138, 140, 141, 143, 145, 147, 154-156 and 164 and serve responsive documents thereto in accordance with the ruling above. Within fifteen (15) days hereof, plaintiff St. John Armenian Apostolic Church Hollywood, California shall serve further responses, without objection, to Requests for Production, Set Four, Nos. 144, 146, 147, 149, 151, 158-160 and 168 and serve responsive documents thereto in accordance with the ruling above.