Defendants Jose Angel Del Villar’s and DEL Records, Inc.’s motion for a temporary stay for approximately seven (7) months pending the resolution of criminal proceedings in in the Central District of California in USA v. Del Entertainment, Inc. et al., Case No. 2:22-CR-00267, is granted. 

Defendants Jose Angel Del Villar’s and DEL Records, Inc.’s motion to quash Plaintiff Brian Gutierrez’s deposition subpoena for business records issued to Non-party CC Soundhouse LLC is continued to December 18, 2024.   

Defendants Jose Angel Del Villar’s and DEL Records, Inc.’s motion to quash Plaintiff Brian Gutierrez’s deposition subpoena for business records issued to Non-party Harbourview Equity Partners, LLC is continued to December 18, 2024.   

Defendants Jose Angel Del Villar (“Del Villar”) and DEL Records, Inc. (“DEL”) (collectively, “Defendants”) move for an order temporarily staying this action as to Defendants for a period of approximately seven (7) months pending the outcome of the related criminal action which is in the Central District of California styled USA v. Del Entertainment, Inc. et al., Case No. 2:22-CR-00267 before Hon. Maame Ewusi-Mensah Frimpong (“Criminal Action”).  (Notice Motion Stay, pg. 2.)  Defendants move on the grounds that the instant civil action is inexorably intertwined with and related to the Criminal Action, and given this significant overlap, a brief stay of discovery is appropriate as Del Villar will be unable to fully protect his constitutional rights if discovery is not stayed and depositions occur as Plaintiff will question Del Villar, employees of DEL, and other non-party witnesses about information to implicate Defendants for use against them in the Criminal Action, as he has already consistently done in written discovery in this action.  (Notice Motion Stay, pg. 2.)  Defendants also argue a temporary stay is also appropriate here because the constitutional burden imposed on Del Villar far outweighs the interests of the Plaintiff, the public, and other third parties in the pending civil action.  (Notice Motion Stay, pg. 2.)  Defendants also argue Plaintiff will not be prejudiced by a brief delay in the prosecution of the civil action as discovery as the Criminal Action will be heard in approximately seven (7) months.  (Notice Motion Stay, pg. 2.) 

Defendants move to quash Plaintiff Brian Gutierrez’s (“Gutierrez”) (“Plaintiff”) deposition subpoena for business records issued to Non-party CC Soundhouse LLC (“Soundhouse”).1  (Motion Memo Soundhouse, pg. 5.) 

Defendants move to quash Plaintiff’s deposition subpoena for business records issued to Non-party Harbourview Equity Partners, LLC (“Harbourview”).2  (Motion Memo Harbourview, pg. 5.) 

Evidentiary Objections 

Defendants’ 4/3/24 evidentiary objection to the Declaration of Brian Gutierrez (“Gutierrez”) is sustained. 

Background 

On April 20, 2023, Plaintiff initiated this lawsuit against Defendants. Plaintiff’s Complaint asserts claims of harassment, discrimination, retaliation, wrongful termination, and related claims against Defendants. On June 12, 2023, Defendants filed an answer generally denying the allegations in the Complaint.  

On June 7, 2022, almost a year before this action was filed, a criminal complaint was filed against Defendants and Luca Scalisi (“Scalisi”), the CFO of DEL, among others, in the Central District of California in the Criminal Action.  (Decl. of Roberts ¶3, Exh. 1.)  As set forth in the Criminal Complaint, on or around April 6, 2018, Jesus Perez Alvear (“Alvear”), who is not associated with DEL, was a “specially designated narcotics trafficker.” The DOJ alleges that Del Villar, Scalisi, and DEL conspired to violate the Narcotics Kingpin Act by purportedly conducting business with Alvear by using Alvear’s services as a music promoter to arrange performances of certain of DEL’s artists in Aguascalientes, Mexico in April 2018.  (Decl. of Roberts ¶4.) 

Defendants filed the instant motion on March 8, 2024.  Plaintiff filed his opposition on March 28, 2024.  Defendants filed their reply on April 4, 2024. 

Discussion 

Courts have broad discretion to stay cases in the interest of efficiency and justice. Every court has the “inherent power, in its discretion, to stay proceedings when such a stay will accommodate the ends of justice.” (See St. Paul Fire and Marine Insurance Company v. AmerisourceBergen Corp. (2022) 80 Cal.App.5th 1, 6-7.)  The Code of Civil Procedure further empowers every court to “provide for the orderly conduct of proceedings before it.” (C.C.P. §128(a)(3); see C.C.P. §187 [conferring on courts and judicial officers “all the means necessary” to carry out their jurisdiction].) 

“The decision whether to stay civil proceedings in the face of a parallel criminal proceeding should be made ‘in light of the particular circumstances and competing interests involved in the case.’ [Citation.] This means the decisionmaker should consider ‘the extent to which the defendant's fifth amendment rights are implicated.’ [Citation.] In addition, the decisionmaker should generally consider the following factors: (1) the interest of the plaintiffs in proceeding expeditiously with this litigation or any particular aspect of it, and the potential prejudice to plaintiffs of a delay; (2) the burden which any particular aspect of the proceedings may impose on defendants; (3) the convenience of the court in the management of its cases, and the efficient use of judicial resources; (4) the interests of persons not parties to the civil litigation; and (5) the interest of the public in the pending civil and criminal litigation.” (Avant! Corp. v. Superior Court (2000) 79 Cal.App.4th 876, 885, quoting Keating v. Office of Thrift Supervision (9th Cir. 1995) 45 F.3d 322, 324.) 

The Court in Pacers, Inc. v. Superior Court recognized that while the petitioners were not criminal defendants, they were threatened with criminal prosecution, and granted a stay to prevent the possibility of allowing the prosecutors to monitor the civil proceedings hoping to obtain incriminating testimony from petitioners through civil discovery, which would not only undermine the Fifth Amendment privilege but would also violate concepts of fundamental fairness.  (Pacers, Inc. v. Superior Court (1984) 162 Cal.App.3d 686, 690.) 

Here, a stay is warranted given the facts and issued to be resolved in the Criminal Action are also implicated in this civil matter, as evidenced by the discovery requests propounded by Plaintiff on Defendants that directly implicates the Criminal Action and Plaintiff’s claims for wrongful termination and whistleblower termination.  (See id.; e.g., Decl. of Roberts ¶8, Exh. 6 at RFA No. 23.)  Any party or witness in a civil discovery proceeding may claim the Fifth Amendment privilege against disclosure of information that might tend to incriminate him or her under either federal or state law.  (Warford v. Medeiros (1984) 160 Cal.App.3d 1035, 1042.)  In such cases, the defendant is forced to weigh the risk of an adverse inference in the civil proceeding if he invokes his Fifth Amendment privilege, against the potential disadvantages that might result from waiving the privilege (i.e., discovery beyond the scope of what the rules of criminal procedure allow, exposing defense strategy, etc.). 

Del Villar, DEL, and other witnesses to this action such as Scalisi, have already been indicted and are set to go to trial in the Criminal Action this year. Under such circumstances, Del Villar’s and DEL employees’ Fifth Amendment rights are of greater concern.  (Pacers, Inc., 162 Cal.App.3d at pg. 690.) 

While DEL, as a corporation, does not have Fifth Amendment privileges, a stay is still necessary to protect Del Villar’s rights; in directing discovery to a corporation, there is typically an employee with Fifth Amendment privileges who will ultimately have to respond.  (Avant! Corp., 79 Cal.App.4th at pg. 886.)  The Avant! Corp. Court found that absent a remedy to protect the employees’ Fifth Amendment rights, the implication of their rights against self-incrimination “must be given serious consideration.”  (Id. at pgs. 886-887.)  The Avant! Corp. Court noted that possible remedies include limiting the definition of key terms in written discovery requests or appointing an outsider to act as the corporation’s “agent for discovery purposes” by reviewing “the corporation’s books, tax returns, financial statements, invoices, suborders, and employee lists, and conferring with counsel.” (Id. at pg. 888.)   

Here, such remedies are not available to the Defendants in this case because the Criminal Action relates to specific conduct of DEL employees. The instant case before this Court relies heavily on testimony regarding facts that are not contained in the relevant documentation. As a small company, employees of DEL (such as Mr. Del Villar) hold institutional knowledge and were present for the day-to-day interactions that have given rise to this action and only they would be able to adequately respond to discovery request.  (Decl. of Roberts ¶8, Exh. 6 at RFA No. 23.) 

Plaintiff’s argument in opposition to this motion on the basis of his fear for his safety and concern for his livelihood are not supported by evidence and is not specific enough to identify an actual, cognizable threat that would constitute prejudice sufficient to overcome the immediate threat posed Del Villar’s and the DEL employees’ Fifth Amendment rights.  (Opposition, pg. 8.) 

Accordingly, Defendants’ motion temporarily staying this action as to Defendants for a period of approximately seven (7) months pending the outcome of the Criminal Action is granted. 

Conclusion 

Defendants’ motion to stay this action seven months is granted. 

Moving Party to give notice.   

In light of the Court’s ruling on the motion to stay, the Court continues Defendants’ motion to quash the subpoena for business records issued to Soundhouse to December 18, 2024. 

Moving Party to give notice. 

In light of the Court’s ruling on the motion to stay, the Court continues Defendants’ motion to quash the subpoena for business records issued to Harbourview to December 18, 2024. 

Moving Party to give notice.