Judge: Daniel S. Murphy, Case: 22STCV00816, Date: 2022-12-09 Tentative Ruling

Case Number: 22STCV00816    Hearing Date: December 9, 2022    Dept: 32

BACKGROUND

            On January 7, 2022, Plaintiff Lilly Darvish initiated this action against Defendants Michael K. Lanning and Michael K. Lanning, a Professional Law Corporation for (1) professional negligence and (2) breach of fiduciary duty.

            Defendants represented Plaintiff for over thirty years in connection with estate planning. However, unbeknownst to Plaintiff, Defendants also began representing Plaintiff’s son, Shervin. Defendants did not disclose this conflict of interest and allegedly colluded with Shervin to help Shervin obtain Plaintiff’s shares in the family business, Annex. Defendants allegedly failed to properly advise Plaintiff with regards to the sale and failed to protect Plaintiff’s interests. Defendants allegedly failed to prepare a proper accounting in connection with the sale of Annex assets and helped hide the transactions from Plaintiff.

FinishMaster, Inc. is one of the entities that purchased Annex assets. Plaintiff has sought through a subpoena the Asset Purchase Agreement between Annex and FinishMaster. On November 14, 2022, Plaintiff filed the instant motion for protective order to preserve the confidentiality of the agreement obtained from FinishMaster.   

LEGAL STANDARD

“Before, during, or after a deposition, any party, any deponent, or any other affected natural person or organization may promptly move for a protective order.” (Code Civ. Proc., § 2025.420(a).) “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.” (Id., subd. (b).) “The issuance and formulation of protective orders are to a large extent discretionary.” (Nativi v. Deutsche Bank National Trust Co. (2014) 223 Cal.App.4th 261, 316.) “[T]he burden is on the party seeking the protective order to show good cause for whatever order is sought.” (Id. at p. 318.)

DISCUSSION

            The Purchase Agreement sets forth that the parties to the transaction “shall not set forth the Purchase Price or any other material term of the Contemplated Transaction, which the parties hereto acknowledge constitutes confidential information.” (Chang Decl., Ex. F.) This sufficiently establishes that the information contained in the agreement is confidential and therefore justifies a protective order.

            Defendants contend that Plaintiff has not established good cause for the protective order, but do not dispute the relevance of the purchase agreement or that the agreement contains the above provision on confidentiality. Defendants do not explain why the agreement should not be subject to a protective order.

CONCLUSION

            Plaintiff’s motion for protective order is GRANTED.

BACKGROUND

            On January 7, 2022, Plaintiff Lilly
Darvish initiated this action against Defendants Michael K. Lanning and Michael
K. Lanning, a Professional Law Corporation for (1) professional negligence and
(2) breach of fiduciary duty.

            Defendants represented Plaintiff for
over thirty years in connection with estate planning. However, unbeknownst to
Plaintiff, Defendants also began representing Plaintiff’s son, Shervin. Defendants
did not disclose this conflict of interest and allegedly colluded with Shervin
to help Shervin obtain Plaintiff’s shares in the family business, Annex.
Defendants allegedly failed to properly advise Plaintiff with regards to the sale
and failed to protect Plaintiff’s interests. Defendants allegedly failed to
prepare a proper accounting in connection with the sale of Annex assets and helped
hide the transactions from Plaintiff.  

On November 16, 2022, Plaintiff filed the
instant Amended Motion for Leave to Amend. The motion was originally filed and
served on October 24, 2022 and set for hearing November 16. But due to some
procedural or clerical issues, the hearing was reset for December 9, and Plaintiff
had to refile the motion on November 16. Plaintiff ended up serving the notice
of the amended motion one day late. However, this has not resulted in any prejudice,
and the Court will proceed on the merits.   

LEGAL STANDARD

The court may, in furtherance of justice,
and on such terms as may be proper, allow a party to amend any pleading. (Code
Civ. Proc, §§ 473, subd. (a), 576.) Courts must apply a policy of liberality in
permitting amendments at any stage of the proceeding, including during trial,
when no prejudice to the opposing party is shown. (Duchrow v. Forrest
(2013) 215 Cal.App.4th 1359, 1377.) In determining the extent of prejudice to
the opposing party, the court must consider various factors, such as whether
the amendment would delay trial or increase the discovery burden. (Demetriades
v. Yelp, Inc. (2014) 228 Cal.App.4th 294, 306.)

DISCUSSION

            Plaintiff seeks to add Alan Brumer
as a defendant and to assert a cause of action for elder abuse. The motion
abides by Rule 3.1324. It identifies the effect of the amendment by attaching a
redlined version. (Chang Decl., Ex. B.) It explains that the amendment is
necessary to assert a viable cause of action against Brumer, who allegedly
aided and abetted the scheme to loot Plaintiff’s estate. (Mtn. 3:3-18.) It
explains that Plaintiff’s prior counsel had delayed work on the case and that
Plaintiff’s current counsel substituted in on July 17, 2022 and thereafter
discovered facts leading to potential liability against Brumer. (Mtn. 4:19-24;
Chang Decl. ¶ 4.) This sufficiently sets forth a basis for the amendment.

            Defendant does not articulate any
prejudice from the amendment. Defendant claims that Plaintiff delayed in
bringing the amendment for two years (Opp. 3:9-10), but this case was initiated
in January 2022, and it has not even been one year. In any case, mere delay is
insufficient absent a showing of prejudice. (See Duchrow, supra, 215
Cal.App.4th at p. 1377 [amendments allowed at any stage of the proceedings
absent prejudice].)

CONCLUSION

            Plaintiff’s motion for leave to
amend is GRANTED.