Judge: Daniel S. Murphy, Case: 18MCV00212, Date: 2022-08-17 Tentative Ruling

Case Number: 18MCV00212    Hearing Date: August 17, 2022    Dept: 32

BACKGROUND

This is an action for legal malpractice and breach of fiduciary duty. On November 9, 2018, Plaintiffs Hero Dogs Season One LLC (“HDS1”) and Nuriya Entertainment LLC commenced this action against Defendants Dean A. Avedon, Bemel, Ross & Avedon, LLP, David Beitchman, and Beitchman & Zekian, a Professional Law Corporation.

On July 1, 2021, this Court denied Plaintiffs’ motion to reopen expert discovery, and on August 9, 2021, denied Plaintiffs’ motion for reconsideration of same. On April 1, 2022, the Court denied Plaintiffs’ ex parte application to continue the trial date to allow for further discovery.

However, on May 27, 2022, the Court partially granted Plaintiff’s motion to reopen discovery because a 2016 tax return produced by Defendants in discovery in April 2022 differed from the one obtained from the IRS in 2018. The Court held that “Plaintiff should be allowed to do limited discovery concerning the tax return provided in April 2022 and the office procedures followed by Defendants” in order to address the discrepancy. (May 27, 2022 Order re Mtn. to Reopen Discovery (“May 27 Order”) 3:9-10.)   

Following the Court’s May 27 order, Plaintiffs served subpoenas to nonparties (i) Simon Swart and (ii) Holthouse Carlin and Van Trigt, LLP. Swart is HDS1’s former manager, and Holthouse was HDS1’s tax preparer before Avedon. On July 15, 2022, the Avedon Defendants (hereinafter “Defendants”) filed the instant motion to quash the subpoenas on the grounds that they are overbroad and violate the Court’s May 27 order permitting limited discovery.  

LEGAL STANDARD

“If a subpoena requires … the production of books, documents, electronically stored information, or other things …, the court, upon motion reasonably made by [a party] . . . 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.” (Code Civ. Proc., § 1987.1, subd. (a), (b).) Good cause must be shown to require a non-party to produce documents. (See Calcor Space Facility, Inc. v. Superior Court (1997) 53 Cal.App.4th 216, 224.)

DISCUSSION

            The subpoenas seek information that does not appear related to the limited issue of the inconsistent 2016 tax return. For example, the Swart subpoena seeks materials related to tax returns, K-1’s, partner capital account reconciliations, and the like, not only of Mr. Swart individually, but of “any entity owned in whole or in part by Simon Swart.” (See Dean Decl., Ex. A, p. 3.) Additionally, the requests seek information not just for 2016, but for a full range of years from 2015 to 2019. (Ibid.) The subpoena also requests “[a]ll communications” with various individuals without any limitation as to time and on topics facially unrelated to tax returns. The subpoena to Holthouse is similarly broad with no apparent limitation to the topic of the inconsistent 2016 tax return. (See Dean Decl., Ex. B, p. 3.) For example, the subpoena requests “[a]ll communications with Dean Avedon regarding or relating to the receivership of Cantinas Partners LLC from March 2015 to now” and “[a]ll documents referencing the accounting treatment or disposition of any member of HDS1’s capital account balance.” (Ibid.)

            In their opposition, Plaintiffs make no attempt to reconcile each of the requests with the Court’s May 27 order. Plaintiffs raise two contentions in attempting to explain why the subpoenas are not outside the scope of the Court’s order. First, Plaintiffs argue that they are “already entitled to most of the documents, as they are, for the most part, Plaintiffs’ own business records that have been wrongfully withheld from Ms. Lee by Mr. Swart.” (Opp. 4:6-8.) Second, Plaintiffs argue that “[t]he documents sought are necessary to determine what actually happened with HDS1’s 2016 return and the disappearance of the $1.49 million asset.” (Opp. 4:8-13.)

            However, the issue here is not whether Plaintiffs are entitled to wrongfully-withheld documents. Regardless of what Plaintiffs believe they are entitled to, the Court already ruled on May 27 that discovery was limited to the topic of the 2016 tax return and associated office procedures. (See May 27 Order 3:7-10.) The issue here is whether the requests contained in the subpoenas comply with that limitation. Furthermore, Plaintiffs do not explain how the subpoenas are tailored “to determine what actually happened with HDS1’s 2016 return.” Again, the requests consist of facially overbroad topics such as information on any entity owned by Swart, or all communications (with no limitation on topic) with individuals whose relation to this case is unspecified. (See Dean Decl., Ex. A, p. 3.)

            Plaintiffs’ failure to justify their broad subpoenas lends credence to Defendants’ contention that Plaintiffs are improperly attempting to circumvent prior orders denying Plaintiffs’ requests to reopen discovery and to conduct discovery that should have been completed earlier in the litigation, prior to the cutoff. (See Mtn. 7:8-11.) Absent a satisfactory explanation as to how the subpoenas at issue are narrowly tailored to the limited discovery permitted by the Court on May 27, Plaintiffs cannot be allowed to proceed with their overbroad requests.

CONCLUSION

            Defendants’ motion to quash subpoenas is GRANTED.