Judge: Fumiko Wasserman, Case: 22CMCV00581, Date: 2023-11-16 Tentative Ruling

Case Number: 22CMCV00581    Hearing Date: November 16, 2023    Dept: B

22CMCV00581 BC INDUSTRIAL SERVICES, LLC  v. JANITORIAL EMPORIUM, INC.,

Thursday, November 16, 2023 at 8:30 a.m.

I. BACKGROUND

             Plaintiff BC Industrial Services, LLC (“Plaintiff”) filed the Complaint in this action on November 22, 2022, alleging breach of contract and common count – open book account against Defendant Janitorial Emporium. Inc. (“Defendant”). Plaintiff alleges the parties entered into a contract in November of 2021 where Plaintiff was obligated to “install equipment for specialized laundry chemical services” and Plaintiff would “service the equipment on a regular basis to insure optimal performance.” (Complaint (“Compl.”) at ¶ 5.) Defendant was obligated to “purchase chemicals for the equipment” from Plaintiff only. (Ibid.) The contract had a five-year term. (Ibid.) Plaintiff alleges that Defendant currently owes $208,522.57 on the contract plus prejudgment interest at a rate of 10% per annum, totaling $214,342.22. (Compl., ¶ 20.) 

            Defendant filed the First Amended Cross-Complaint on March 7, 2023, alleging that Plaintiff breached the contract by failing to fill orders for chemicals in a timely manner, failing to service the equipment, improperly increasing the price of the chemicals, and improperly disclosing the existence of the agreement to third parties. (Cross-Complaint, ¶ 6.)  

II. MOTION TO STRIKE AND REQUEST FOR SANCTIONS

A.      Plaintiff’s motion

            Plaintiff requests that the Court strike the First Amended Cross-Complaint and award Plaintiff monetary sanctions because Defendant allegedly failed to comply with the Court’s September 14, 2023, order. The Court ordered Defendant to respond to Plaintiff’s special interrogatories, form interrogatories, and requests for production of documents within 20 days of the entry of the order. Defendant has allegedly failed to produce any responses.

B.      No opposition filed

C.      No reply filed

III. LEGAL STANDARDS

            Misuse of the discovery process is defined by Code of Civil Procedure, section 2023.010, and includes actions such as failing to respond or to submit to an authorized method of discovery or disobeying a court order to provide discovery. (Code Civ. Proc., § 2023.030, subds. (d) and (g).) The court may impose monetary sanctions, issue sanctions, evidentiary sanctions, terminating sanctions, and contempt sanctions for conduct that constitutes a misuse of the discovery process.

            For a monetary sanction,

“The court may impose a monetary sanction ordering that one engaging in the misuse of the discovery process … pay the reasonable expenses, including attorney's fees, incurred by anyone as a result of that conduct. … If a monetary sanction is authorized by any provision of this title, the court shall impose that sanction unless it finds that the one subject to the sanction acted with substantial justification or that other circumstances make the imposition of the sanction unjust.” (Code Civ. Proc., § 2023.030, subd. (a).)

            For a terminating sanction,

“The court may impose a terminating sanction by one of the following orders: (1) An order striking out the pleadings or parts of the pleadings of any party engaging in the misuse of the discovery process. (2) An order staying further proceedings by that party until an order for discovery is obeyed. (3) An order dismissing the action, or any part of the action, of that party. (4) An order rendering a judgment by default against that party.” (Code Civ. Proc., § 2023.030, subd. (d).)

IV. DISCUSSION

            Discovery sanctions are not to be imposed for punishment, but instead are used to encourage fair disclosure of discovery to prevent unfairness resulting from the lack of information. “Sanctions are inappropriate to impose punishment.” (Midwife v. Bernal (1988) 203 Cal. App. 3d 57, 64.) Terminating sanctions are appropriate, however, where there is an outright refusal to comply with discovery obligations. “[T]here is no question that a court is empowered to apply the ultimate sanction against a litigant who persists in the outright refusal to comply with his discovery obligations [citations omitted]. The refusal to reveal material evidence is deemed to be an admission that the claim or defense is without merit.” (Deyo v. Kilbourne, (1978) 84 Cal. App. 3d 771, 793.)

            In Deyo, the Court of Appeal laid out several factors to consider before entering terminating or ‘ultimate’ sanctions.

“[T]he court must examine the entire record in determining whether the ultimate sanction should be imposed. (National Hockey League v. Met. Hockey Club, supra., 427 U.S. 639, 642 [49 L.Ed.2d 747, 750-751]; Wilson v. Volkswagen of America, Inc., supra. 561 F.2d 494, 504-506; Stein v. Hassen supra..) In exercising this discretion, a variety of factors may be relevant, including, 1) the time which has elapsed since interrogatories were served, 2) whether the party served was previously given a voluntary extension of time, 3) the number of interrogatories 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 remain 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, supra, 84 Cal.App.3d at pgs. 796–797.)

            Here, the underlying discovery requests at issue were served on June 6, 2023. (Decl. of Kate Neiswender, attached to Motion to Compel Further Responses filed August 10, 2023,  ¶ 4.) When the deadline to respond arrived, Plaintiff granted Defendant with a two-week extension to provide responses. (Ibid.) Objections were served on July 24, 2023. (Ibid.) Plaintiff believed the objections were deficient and filed a motion to compel further responses on August 10, 2023. Defendant did not file an opposition to the motion.

            On September 14, 2023, Defendant’s counsel appeared at the hearing and represented that they did not object to providing further responses. (Minute Order issued September 14, 2023.) The Court then ordered  “Defendant to provide substantive, code-compliant responses to BC Industrial Services, LLC's Special Interrogatories, Set One, Form Interrogatories, Set One, and Request for Production of Documents, Set One. The responses must be served within 20 days of this order.” (Ibid.) Defendant was also ordered to pay sanction in the amount of $2,180.00. (Ibid.) The compelled responses and monetary sanctions were due by the end of day on October 4, 2023. Plaintiff argues that no responses were produced.  

            Plaintiff propounded 24 special interrogatory requests, 35 form interrogatory requests, and two requests for production of documents requesting any documents identified in response to the form and special interrogatories. The form and special interrogatories seek extensive and detailed information about the agreements alleged and the factual disputes between the parties. A total of 61 discovery requests remains unanswered.

            Based on the foregoing, the Court finds that an additional monetary sanction is appropriate for Defendant’s failure to comply with the September 14, 2023, order. The Court does not find that issuing a terminating sanction and striking the First Amended Cross-Complaint is warranted. Defendant was initially diligent in seeking and obtaining an extension of time to respond to the discovery at issue. Defendant served objections within the extended time to respond. At the hearing on Plaintiff’s motion to compel further responses, Defendant did not oppose the motion and was willing to provide further responses. The Court finds that a lesser sanction is more appropriate.  

V.  CONCLUSION

             Having fully considered the arguments of the parties, both written and oral, the Court exercises its discretion and rules as follows:

            The request for monetary sanctions against Defendant is GRANTED in the amount of $1,465.00 for Defendant’s failure to comply with the Court’s September 14, 2023, order. Defendant is ordered to pay Plaintiff $1,465.00 in sanctions and to comply with the September 14, 2023, by the end of day on November 27, 2023.