Judge Elaine Lu, Case Number: 21STCV44777, Date: 2025-04-08 Tentative Ruling

This is a putative wage and hour class action. Plaintiff Maria Lopez
alleges that she and the putative class members are and were non-exempt
employees of Defendants Empire Connect, Inc., Sam Management, LLC, and A1, A CA
Commercial Cannabis Association, Inc. (collectively “Defendants”). Plaintiff
also alleges that Defendants violated the Labor Code, applicable Industrial
Welfare Commission Wage Orders, and the Business and Professions Code.

On December 8, 2021, Plaintiff filed the
instant class action complaint. On June 1, 2022, Plaintiff filed a First
Amended Complaint (“FAC”). In the FAC, Plaintiff asserts eight causes of action
for (1) failure to pay all wages; (2) failure to provide meal periods; (3)
failure to permit rest periods; (4) failure to provide accurate itemized wage
statements; (5) waiting time penalties; (6) failure to reimburse business
expenses; (7) violation of the Unfair Competition Law (“UCL”); and (8) civil
penalties under the Private Attorneys General Act (“PAGA”). On April 30, 2024, Empire Connect, Inc. was
named as Doe 1.

On May 14, 2024, the Court granted Plaintiff’s
motion to compel Defendants Empire Connect, LLC
and Sam Management, LLC to comply with their respective responses to produce
documents in response to Request for Production of Documents, Set One (“RPDs”)
Nos. 5-9. (Order 5/4/24.)

On August 14, 2024, Plaintiff filed the
operative Second Amended Complaint (“SAC”) against Defendants Empire Connect
Inc. (“Empire”), Sam Management, LLC (“Sam Management”), and A1, A CA
Commercial Cannabis Association, Inc. In
the FAC, Plaintiff asserts eight causes of action for (1) failure to pay all
wages; (2) failure to provide meal periods; (3) failure to permit rest periods;
(4) failure to provide accurate itemized wage statements; (5) waiting time
penalties; (6) failure to reimburse business expenses; (7) violation of the UCL;
and (8) civil penalties under PAGA.

On March 10, 2025, Plaintiff filed the instant
motion to compel compliance with the Court’s May 14, 2024 Order and for issues,
evidentiary, and/or monetary sanctions against Defendants Empire and Sam
Management. On March 25, 2025, Plaintiff
filed a notice of non-opposition. Later
the same day – March 25, 2025 – Plaintiff filed a reply. On March 26, 2025, Defendants Empire and Sam
Management filed an opposition.[1]

“Unless otherwise ordered or specifically provided by law … All papers opposing a motion so
noticed shall be filed with the court and a copy served on each party at least
nine court days, and all reply papers at least five court days before the
hearing.” (CCP § 1005(b) [bold and
italics added].) This is calculated by
counting backwards from the hearing date and excluding holidays and
weekends. (CCP §§ 12-12(c).) The court may refuse to consider a late-filed
paper. (Cal. Rules of Court, Rule
3.1300(d).)

Here, the Notice of
Motion clearly identifies this briefing schedule and notes that this schedule
was ordered by the Court:

Defendants Empire and Sam Management filed an
opposition on March 26, 2025 – seven days past the due date. Thus, the opposition is untimely. However, Plaintiff was able to file a timely
and responsive reply. Accordingly, the
Court – in its discretion – will consider the untimely opposition. However, any future untimely filings may be
disregarded or stricken.

Code of Civil Procedure
section 2023.030 provides that, “[t]o the extent authorized by the chapter
governing any particular discovery method . . . , the court, after notice to
any affected party, person, or attorney, and after opportunity for hearing, may
impose . . . [monetary, issue, evidence, or terminating] sanctions against
anyone engaging in conduct that is a misuse of the discovery process . . .
.” Code of Civil Procedure section
2023.010 provides that “[m]issues of the discovery process include, but are not
limited to, the following: . . . (d) Failing to respond or to submit to an
authorized method of discovery. . . . (g) Disobeying a court order to provide
discovery . . . .”

“A trial court has broad
discretion when imposing a discovery sanction.”
(Lee, supra, 175 Cal.App.4th at p.1559.) “In exercising this discretion [for
nonmonetary sanctions], a variety of factors may be relevant, including, 1) the
time which has elapsed since [the discovery requests] were served, 2)
whether the party served was previously given a voluntary extension of time, 3)
the number of [the discovery requests] propounded, 4) whether the unanswered
questions sought information which was difficult to obtain, 5) whether the
answers supplied were evasive and incomplete, 6) the number of questions which
remained unanswered, 7) whether the questions which remain unanswered are
material to a particular claim or defense, 8) whether the answering party has acted
in good faith, and with reasonable diligence, 9) the existence of prior orders
compelling discovery and the answering party's response thereto, 10) whether
the party was unable to comply with the previous order of the court, 11)
whether an order allowing more time to answer would enable the answering party
to supply the necessary information, and, 12) whether a sanction short of
dismissal or default would be appropriate to the dereliction.” (Deyo v. Kilbourne (1978) 84
Cal.App.3d 771, 796–797.)

“Nevertheless, absent unusual
circumstances, such as repeated and egregious discovery abuses, two facts are
generally prerequisite to the imposition of a nonmonetary sanction. There must
be a failure to comply with a court order and the failure must be willful.” (Lee v. Lee (2009) 175
Cal.App.4th 1553, 1559.) “Even where
nonmonetary sanctions are called for, they ‘ “...’should be appropriate to the
dereliction, and should not exceed that which is required to protect the
interests of the party entitled to but denied discovery.’ [Citations.] ‘ “...
[¶] The sanctions the court may impose are such as are suitable and necessary
to enable the party seeking discovery to obtain the objects of the discovery he
seeks, but the court may not impose sanctions which are designed not to
accomplish the objects of discovery but to impose punishment.’ ” ’
[Citations.]” (Biles v. Exxon Mobil
Corp. (2004) 124 Cal.App.4th 1315, 1327.)

“The trial court may order a
terminating sanction for discovery abuse ‘after considering the totality of the
circumstances: [the] conduct of the party to determine if the actions were
willful; the detriment to the propounding party; and the number of formal and
informal attempts to obtain the discovery.’”
(Los Defensores, Inc. v. Gomez (2014) 223 Cal.App.4th 377, 390
[quoting Lang v. Hochman (2000) 77 Cal.App.4th 1225, 1246].) “Generally, ‘[a] decision to order
terminating sanctions should not be made lightly. But where a violation is willful, preceded by
a history of abuse, and the evidence shows that less severe sanctions would not
produce compliance with the discovery rules, the trial court is justified in
imposing the ultimate sanction.’” (Los
Defensores, supra, 223
Cal.App.4th at p. 390 [citation omitted].)

“Under this standard, trial
courts have properly imposed terminating sanctions when parties have willfully
disobeyed one or more discovery orders.”
(Ibid. [citing Lang, supra, 77 Cal.App.4th at pp. 1244-1246); see, e.g., Collisson & Kaplan v. Hartunian (1994) 21
Cal.App.4th 1611, 1617-1622 (terminating sanctions imposed after defendants
failed to comply with one court order to produce discovery); Laguna Auto
Body v. Farmers Ins. Exchange (1991) 231 Cal.App.3d 481, 491 disapproved on
other grounds in Garcia v. McCutchen (1997) 16 Cal.4th 469, 478, fn.4,
[terminating sanctions imposed against the plaintiff for failing to comply with
a discovery order and for violating various discovery statutes].) However, “a penalty as severe as dismissal or
default is not authorized where noncompliance with discovery is caused by an
inability to comply rather than willfulness or bad faith.” (Brown
v. Superior Court (1986) 180 Cal.App.3d 701, 707.)

Plaintiff seeks issue or alternatively evidentiary
sanctions against Defendants Empire Connect, Inc. and Sam Management, LLC for their
failure to comply with the Court’s May 14, 2024 Order. In addition, Plaintiff also seeks monetary
sanctions.

Whether Empire Connect, Inc.
Has Failed to Comply with the Court’s May 14, 2024 Order

In the Court’s May 14, 2024 Order,
the Court ordered “Defendants Empire Connect, LLC and Sam Management,
LLC to produce documents in compliance with their responses to do so with
respect to Request for Production of Documents, Set One Nos 5-9” within fifteen
days of notice of the order. (Order
5/14/24 at p.8:12-18 [bold added].) In
addition, the Court ordered Defendants Empire Connect, LLC and Sam
Management, LLC to each pay monetary sanctions of $1,575.00 to Plaintiff. (Order 5/14/24 at p.8:19-25.) On May 20, 2024, Plaintiff served a copy of
the May 14, 2024 Order on Defendants Empire Connect, LLC and Sam Management,
LLC. (Kwak Decl. ¶ 14, Exh. 5.) However, Defendants Empire Connect, LLC and
Sam Management, LLC have not produced any documents or paid any sanctions. (Kwak Decl. ¶ 19.)

On
August 14, 2024, Plaintiff filed the operative SAC in which Empire Connect, LLC
is no longer a named party. (Kwak Decl.
¶ 15.) Rather, the SAC alleges that Defendant
Empire Connect, Inc. was converted from and formerly known as the now former
defendant Empire Connect, LLC. (SAC ¶
9.) On October 4, 2024, Defendants
Empire Connect, Inc. and Sam Management, LLC filed their respective answers to
the SAC. (Kwak Decl. ¶ 16.)

On January 16,
2025, Plaintiff’s Counsel contacted Defendants Empire Connect, Inc.’s and Sam
Management, LLC’s Counsel regarding Defendants Empire Connect, LLC’s and Sam
Management, LLC’s failure to comply with the Court’s May 14, 2024 Order. (Kwak Decl. ¶ 17, Exh. 6.) In Counsels’ email correspondence between
January 31, 2025 and February 7, 2025, Defendants Empire Connect, Inc.’s and
Sam Management, LLC’s Counsel indicated that they were still trying to locate responsive
documents, and that Counsel did not believe their client was going to pay the
sanctions. (Kwak Decl. ¶ 18, Exh. 7.) As of this motion, Defendants Empire Connect,
LLC and Sam Management, LLC have not produced any documents or paid any
sanctions. (Kwak Decl. ¶ 19.)

Notably,
the Court’s May 14, 2024 Order only compels “Defendants Empire Connect, LLC
and Sam Management, LLC to produce documents in compliance with their responses
to do so with respect to Request for Production of Documents, Set One Nos 5-9”
within fifteen days of notice of the order and pay monetary sanctions. (Order 5/14/24 at p.8:12-25 [bold
added].) However, Plaintiff seeks issue,
evidentiary, and monetary sanctions from Empire Connect Inc. and Sam
Management, LLC. Though Plaintiff
alleges Defendant Empire Connect, Inc. was converted from and formerly known as
the now former defendant Empire Connect, LLC, (SAC ¶ 9), Plaintiff presents no
evidence to support this allegation. Nor
has Empire Connect, Inc. conceded in its answer that it is the successor to
Empire Connect, LLC, and thus, liable for Empire Connect, LLC’s failure to
comply with the Court’s May 14, 2024 Order.
Absent such evidence, the Court cannot hold Empire Connect, Inc. liable
for a separate legal entity’s – i.e., Empire Connect, LLC’s – failure to comply with the Court’s May 14,
2024 Order.

However,
at today's hearing, Plaintiff requested a continuance of the hearing with
respect to Empire Connect, LLC to allow Plaintiff to submit supplemental
evidence and briefing only as to Empire Connect, LLC. Plaintiff's request
is GRANTED.

By no
later than April 15, 2025, Plaintiff must file and serve supplemental evidence
(no page limit) and supplemental briefing (no more than 3 pages) as to Empire
Connect, LLC.

By no
later than April 25, 2025, Defendant may file and serve any supplemental
evidence (no page limit) and supplemental briefing (no more than 3 pages) as to
Empire Connect, LLC.

Plaintiff's
Motion to Compel Compliance with the May 14, 2024 order is CONTINUED ONLY WITH
RESPECT TO EMPIRE CONNECT LLC to June 5, 2025 at 10 am.

As noted above, Defendant Sam
Management failed to comply with the Court’s May 14, 2024 Order and pay Plaintiff $1,575.00 in monetary sanctions. (Kwak Decl. ¶ 19.) However, the failure to pay monetary
sanctions is not a basis and does not warrant additional sanctions. (See e.g., Newland v. Superior Court
(1995) 40 Cal.App.4th 608, 615 [holding that “terminating sanction issued
solely because of a failure to pay a monetary discovery sanction is never
justified.”].) As noted by the Court of
Appeal in Newland, “many attorneys seem to be unaware that monetary
sanction orders are enforceable through the execution of judgment laws.” (Ibid.) Monetary sanctions “have the force and effect
of a money judgment, and are immediately enforceable through execution, except
to the extent the trial court may order a stay of the sanction.” (Ibid.)

Plaintiff
can simply enforce the monetary sanctions imposed in the Court’s May 14, 2024
Order as a judgment. Thus, additional
sanctions based on Defendant Sam Management’s failure to pay monetary sanctions
are not warranted.

Plaintiff seeks an issue sanction establishing that “Defendants Empire
and Sam Management did not make any business expense reimbursement payments
required under California Labor Code section 2800, et seq., to Plaintiff, the
putative class, and aggrieved employees for any of the pay periods during the
alleged relevant class liability period and PAGA liability period.” (Motion at p.5:15-18.) Alternatively, Plaintiff seeks evidentiary
sanctions “prohibiting Defendants Empire and Sam Management from introducing
evidence on the following matters as they relate to Plaintiff’s Sixth Cause of
Action, derivative claims, and theories of liability: whether Defendants failed
to reimburse Plaintiff, the putative class, and aggrieved employees for
necessary business expenditures during the alleged relevant class liability
period and PAGA liability period.”
(Motion at p.14-18.)

Here, there is no dispute that
Empire Connect, LLC and Defendant Sam Management LLC failed to comply with the
Court’s May 14, 2024 Order. (Kwak Decl.
¶ 19.) In opposition, Defendants Empire
and Sam Management claim that this failure to comply was not willful. Tony On – who claims to be the person most
knowledgeable of Empire Connect, LLC and Sam Management, LLC, (See Supp. Kwak
Decl. ¶ 5, Exh. 9 [On Depo. at pp.9-11) – stated in his May 6, 2025 deposition
that responsive business documents from Empire Connect, LLC and Sam Management,
LLC were destroyed in a fire that took place at some point in 2023. (Bell Decl. ¶ 2, Exh. 1 [On Depo. at
p.75].) Further, On testified that there
are no employees remaining at Empire Connect LLC to whom he could speak about
what happened. (Bell Decl. ¶ 2, Exh. 1
[On Depo. at p.76].) Though On indicated
that some responsive documents may have been saved on an email server, he would
need to contact the IT company which On did not know how to do as of March 6,
2025. (Supp. Kwak Decl. ¶ 5, Exh. 9 [On
Depo. at p.77].)

Should responsive documents no
longer exist, Defendant Sam Management, LLC – the remaining defendant ordered
to produce documents – is required to supplement its response to RPDs Nos. 5-9 and
affirm as such and state all reasonable steps taken to uncover responsive
documents. Defendant Sam Management has
not done so. (Supp. Kwak Decl. ¶
4.) Thus, the Court cannot conclude – at
this time – that the responsive documents no longer exist and were destroyed in
the 2023 fire. However, based on On’s
testimony, the failure to produce the responsive documents ordered in the
Court’s May 14, 2024 Order does not appear to be willful as required for the
imposition of nonmonetary sanctions. (Lee,
supra, 175 Cal.App.4th at p.1559.)

Accordingly, Plaintiff’s
request for issue or alternatively evidentiary sanctions against Defendant Sam
Management is DENIED WITHOUT PREJUDICE.
By no later than May 6, 2025, Defendant Sam Management, LLC is again
ordered to comply with its respective responses and produce documents in
response to Requests for Production of Documents, Set One (“RPDs”) Nos.
5-9. This includes making reasonable efforts to locate and obtain the
responsive documents, including, if necessary, contacting the IT company about
any responsive documents on the email server about which Tony On testified
during his deposition. If responsive documents no longer exist, Defendant
Sam Management, LLC is ordered to serve verified supplemental response to RPDs
Nos. 5-9 affirming that responsive documents no longer exist, explaining why
responsive documents no longer exist, stating all reasonable steps taken to
gather and produce all responsive documents, and explaining why Defendant Sam
Management, LLC is unable to procure any responsive documents notwithstanding
the identified reasonable efforts.
Failure to comply may subject Defendant Sam Management, LLC to issue or
evidentiary sanctions upon a renewed motion by Plaintiff.

Defendant Sam Management
failed to comply with the Court’s May 14, 2024 Order. (Kwak Decl. ¶ 19.) Though this failure to comply is not willful,
Defendant Sam Management failed to properly update the discovery responses at
issue to state that responsive documents no longer exist and to set forth all
reasonable steps taken to uncover responsive documents. Accordingly, monetary sanctions are
warranted.

“If a party then
fails to obey an order compelling further response [to interrogatories, request
for production, or requests for admission], the court may … impose a monetary
sanction under [CCP § 2023.030.]” (CCP §§
2030.300(e), 2031.310(i), 2033.290(e).)
Under Code of Civil Procedure section 2023.030(a), the court may impose
sanction covering the costs of “reasonable expenses, including attorney’s
fees”. (CCP § 2023.030(a).)

Here, Plaintiff’s
Counsel states that he spent 9.5 hours in connection with the instant motion at
a billed hourly rate of $525. (Kwak
Decl. ¶¶ 6-9.) Plaintiff’s Counsel
asserts that he incurred filing fees of $97.34.
(Kwak Decl. ¶ 5.) Based on the
totality of
the circumstances, the Court finds that the requested sanctions of
$5,084.84 reasonably
compensates Plaintiff for attorney’s fees and costs incurred in bringing this
motion.

Defendant Sam Management, LLC
is ordered to pay monetary sanctions in the amount of $5,084.84 to
Plaintiff Maria Lopez by and through counsel, within thirty (30) days of notice
of this order.

Based on
the foregoing, Plaintiff Maria Lopez’s motions to compel Defendants Empire
Connect, Inc.’s and Sam Management, LLC’s compliance with the Court’s May 14,
2024 Order and for issues, evidentiary, and/or monetary sanctions is GRANTED
IN PART.

Plaintiff’s request for issue
or alternatively evidentiary sanctions against Defendant Sam Management is DENIED
WITHOUT PREJUDICE.

By no later than May 6, 2025,
Defendant Sam Management, LLC is again ordered to comply with its respective
responses and produce documents in response to Requests for Production of
Documents, Set One (“RPDs”) Nos. 5-9. This includes making reasonable
efforts to locate and obtain the responsive documents, including, if necessary,
contacting the IT company about any responsive documents on the email server
about which Tony On testified during his deposition. If responsive
documents no longer exist, Defendant Sam Management, LLC is ordered to serve
verified supplemental response to RPDs Nos. 5-9 affirming that responsive
documents no longer exist, explaining why responsive documents no longer exist,
stating all reasonable steps taken to gather and produce all responsive
documents, and explaining why Defendant Sam Management, LLC is unable to
procure any responsive documents notwithstanding the identified reasonable
efforts. Failure to comply may subject Defendant
Sam Management, LLC to issue or evidentiary sanctions upon a renewed motion by
Plaintiff.

Plaintiff’s
request for monetary sanctions against Sam Management, LLC is GRANTED.

Defendant
Sam Management, LLC is ordered to pay monetary sanctions in the amount of $5,084.84 to Plaintiff Maria Lopez by and through counsel, within thirty (30)
days of notice of this order.

Plaintiff’s
request for a continuance of the hearing with respect to Empire Connect, LLC to
allow Plaintiff to submit supplemental evidence and briefing only as to Empire
Connect, LLC is GRANTED. By no
later than April 15, 2025, Plaintiff must file and serve supplemental evidence
(no page limit) and supplemental briefing (no more than 3 pages) as to Empire
Connect, LLC. By no later than April 25,
2025, Defendant may file and serve any supplemental evidence (no page
limit) and supplemental briefing (no more than 3 pages) as to Empire Connect,
LLC. Plaintiff's Motion to Compel
Compliance with the May 14, 2024 order is CONTINUED ONLY WITH RESPECT TO
EMPIRE CONNECT LLC to June 5, 2025 at 10 am.

The deadline for Plaintiff to file a
motion for class certification is CONTINUED to JULY 1, 2025. The Non-Appearance Case Review re filing of motion
for class certification is CONTINUED to JULY 8, 2025 at 8:30 am.

The parties state that Plaintiff will be
filing a motion for leave to amend the complaint to add a defendant. The Court urges Plaintiff to file and serve
that motion for leave to amend immediately given the impending deadline for
Plaintiff to move for class certification.

Plaintiff is ordered to download the
instant signed order from the Court's website and to file proof of service of
the instant order on all other parties within five (5) days.

[1] Based on the reply papers, it
appears that Defendant served its opposition on March 25, 2025 prior to
Plaintiff’s reply. (Supp. Kwak Decl. ¶
3.) Moreover, the reply is responsive to
the opposition despite the fact that the opposition was not filed until the day
after the reply was filed.