Judge Gary Y. Tanaka, Case 20TRCV00099 2022-12-12 Tentative Ruling

Judge: Gary Y. Tanaka, Case: 20TRCV00099, Date: 2022-12-12 Tentative Ruling

Case Number: 20TRCV00099 Hearing Date: December 12, 2022 Dept: B

LOS ANGELES SUPERIOR COURT – SOUTHWEST DISTRICT

Honorable Gary Y. Tanaka Monday, December 12, 2022

Department B Calendar No. 6

PROCEEDINGS

Fred J. Kim, DDS, Inc., et al. v. Joo Hwan Kim, et al.

20TRCV00099

1. Joo Hwan Kim’s Motion to Set Aside Default Judgment and Default

2. Fred J. Kim, DDS, Inc., et al.’s Motion for Attorneys’ Fees and Costs

TENTATIVE RULING

Joo Hwan Kim’s Motion to Set Aside Default Judgment and Default is granted.

Fred J. Kim, DDS, Inc., et al.’s Motion for Attorneys’ Fees and Costs is granted.

Background

Plaintiffs filed their Complaint on January 29, 2020. Plaintiffs allege the following facts. Plaintiff Fred J. Kim, D.D.S. (“Dr. Kim”) is a licensed dentist. Defendant Ta Yeon Park is Dr. Kim’s former patient. Defendant Joo Hwan Kim is Ta Yeon Park’s son, and he served as Ms. Park’s translator during several of her dental appointments. Beginning on January 15, 2020, Defendants posted over a thousand false and disparaging reviews about Dr. Kim on consumer review websites including Yelp and Google. These reviews falsely accused Dr. Kim of malpractice, of refusing to provide a refund to Defendants, of yelling at Defendants, of throwing Defendants out of Dr. Kim’s office, and of refusing to provide further treatment to Park. Plaintiffs set forth a sole cause of action for Defamation.

Defendants filed their Cross-Complaint on February 27, 2020. On May 4, 2020, Defendants served Dr. Kim with an Amended Cross-Complaint (“FACC”) but did not file the FACC until June 12, 2020. The following causes of action were asserted: 1. Unfair Competition (Bus. & Prof. Code 17200); 2. False Advertising (Bus. & Prof. Code 17500); 3. Violation of the Consumer Legal Remedies Act; 4. Unjust Enrichment; 5. Violations of Bus. & Prof. Code § 17200 and Civil Code § 1670.8. Under the fifth cause of action, Cross-Complainants alleged that by filing a lawsuit for defamation, Dr. Kim sought to circumvent Civil Code §1670.8’s prohibition against contracts that limit a consumer’s right to make statements regarding a merchant.

Cross-Defendants filed a special motion to strike the FACC’s Fifth Cause of Action under Civil Procedure Code § 425.16. Cross-Defendants filed a motion for sanctions under CCP § 128.7 to strike the first through fourth causes of action. Cross-Complainants failed to oppose the anti-SLAPP motion and motion for sanctions. The motions were granted on August 4, 2020.

Cross-Complainants filed a Motion for Leave to File an Opposition to Plaintiff’s Special Motion to Strike which was denied by the Court on April 6, 2021. This motion was denied outright and was not denied with prejudice.

On May 11, 2021, Cross-Defendants’ Motions for Attorneys’ Fees pursuant to CCP § 425.16 and CCP § 128.7 were granted. On May 23, 2022, Plaintiffs’ Motion for Summary Judgment was granted.

Motion to Set Aside Default and Default Judgment

CCP § 473(b) states, in relevant part: “The court may, upon any terms as may be just, relieve a party or his or her legal representative from a judgment, dismissal, order, or other proceeding taken against him or her through his or her mistake, inadvertence, surprise, or excusable neglect. Application for this relief shall be accompanied by a copy of the answer or other pleading proposed to be filed therein, otherwise the application shall not be granted, and shall be made within a reasonable time, in no case exceeding six months, after the judgment, dismissal, order, or proceeding was taken. . . . Notwithstanding any other requirements of this section, the court shall, whenever an application for relief is made no more than six months after entry of judgment, is in proper form, and is accompanied by an attorney's sworn affidavit attesting to his or her mistake, inadvertence, surprise, or neglect, vacate any (1) resulting default entered by the clerk against his or her client, and which will result in entry of a default judgment, or (2) resulting default judgment or dismissal entered against his or her client, unless the court finds that the default or dismissal was not in fact caused by the attorney's mistake, inadvertence, surprise, or neglect. The court shall, whenever relief is granted based on an attorney's affidavit of fault, direct the attorney to pay reasonable compensatory legal fees and costs to opposing counsel or parties. . . .”

CCP § 473.5(a) states, in relevant part: “When service of a summons has not resulted in actual notice to a party in time to defend the action and a default or default judgment has been entered against him or her in the action, he or she may serve and file a notice of motion to set aside the default or default judgment and for leave to defend the action. The notice of motion shall be served and filed within a reasonable time, but in no event exceeding the earlier of: (i) two years after entry of a default judgment against him or her; or (ii) 180 days after service on him or her of a written notice that the default or default judgment has been entered.” CCP § 473.5(b) states: “A notice of motion to set aside a default or default judgment and for leave to defend the action shall designate as the time for making the motion a date prescribed by subdivision (b) of Section 1005, and it shall be accompanied by an affidavit showing under oath that the party's lack of actual notice in time to defend the action was not caused by his or her avoidance of service or inexcusable neglect. The party shall serve and file with the notice a copy of the answer, motion, or other pleading proposed to be filed in the action.” The phrase “actual notice” means “genuine knowledge of the party litigant” and does not include constructive or imputed notice to the client. Tunis v. Barrow (1986) 184 Cal.App.3d 1069, 1077.

While the title of the motion states that Defendant is moving to set aside the default and default judgment, in actuality it appears that Defendant is moving for relief from the entry of judgment following the Court’s order granting Plaintiff’s motion for summary judgment. The motion is made on the ground that the positive misconduct of Defendant’s prior attorney, Michael Devereux, led to the Court’s granting Plaintiff’s motion for summary judgment. Defendant states that Devereux failed to file any written opposition to the motion and neglected to conduct any discovery and respond to discovery in this matter. The Court further notes that moving party referred to CCP § 473.5, but this section does not appear to have any applicability to the facts of the instant motion. Instead, the motion is solely premised upon the discretionary provision of CCP § 473(b) and on the ground that the admitted inexcusable neglect of the attorney should not be imputed to the client.

“As a general rule, however, the negligence of an attorney is imputed to the client. [¶] California courts recognize an exception to this rule in those cases where the attorney's neglect is of that extreme degree amounting to positive misconduct, and the person seeking relief is relatively free from negligence. This exception is premised on the concept such extreme misconduct obliterates the existence of the attorney-client relationship and for this reason the client has no attorney from whom negligence can be imputed. . . . Imputation of the attorney's neglect to the client ceases at the point where abandonment of the client appears. [¶] What constitutes “abandonment” of the client depends on the facts in the particular action. Even where abandonment is shown, however, the courts also consider equitable factors in deciding whether the dismissal of an action should be set aside. These factors include the client's own conduct in pursuing and following up the case, whether the defendant would be prejudiced by allowing the case to proceed and whether the dismissal was discretionary or mandatory. The courts must also balance the public policy favoring a trial on the merits against the public policies favoring finality of judgments and disfavoring unreasonable delays in litigation and the policy an innocent client should not have to suffer from its attorney's gross negligence against the policy a grossly incompetent attorney should not be relieved from the consequences of his or her incompetence.” Seacall Development, Ltd. v. Santa Monica Rent Control Bd. (1999) 73 Cal.App.4th 201, 204–205 (internal citations and quotations omitted).

The Court determines that, under the facts presented by moving party, the conduct of Defendant’s former counsel, Michael Devereux, constitutes positive misconduct which warrants, after consideration of all the relevant equitable factors, relief from the order granting summary judgment. The Court will not list the litany of acts of misconduct on the part of Devereux but will note that even opposing party concurs that the conduct of Devereux constitutes inexcusable neglect. (An exhaustive list of the offending conduct is set forth on pages 2 to 9 of the motion, as well as on pages 3 to 11 of the declaration of Defendant Joo Hwan Kim.) Among the conduct which constituted inexcusable neglect was Devereux’s repeated failure to propound or respond to discovery, and repeated failure to oppose motions, especially significant motions such as the underlying motion for summary judgment. What places this conduct in the realm of positive misconduct is Devereux’s repeated misrepresentations and concealments to the client regarding the status of the case and misrepresentations regarding Devereux’s actions in representing the client. Plaintiff argues that Devereux’s actions did not constitute complete “abandonment” since he appeared on some matters, did continue to file some documents, and did appear to be in consistent communication with the client. However, “abandonment” for purposes of the positive misconduct theory of relief cannot simply be equated with an attorney’s complete “disappearance.” A strong argument could be made that Devereux’s continued actions of falsely assuring the client that the litigation was proceeding as planned, and, that any rulings against the client were either wrong or could easily be rectified (when that was clearly not the case) was even more of an act of abandonment in this situation than had Devereux completely stopped responding to Defendant, at all. Devereux’s blatant misrepresentations prevented Defendant from seeking out means to make sure he was obtaining competent representation.

Plaintiffs argue that Defendant, himself, was negligent and should have protected his interests when it became clear that Devereux was grossly incompetent. While the Court and opposing counsel could see the blatant misconduct engaged by Devereux, the Court is mindful that a layperson client could not so easily discern this information, especially considering, it appears, that in certain instances Devereux utilized his position of power as an attorney to attempt to squelch any concerns that the client may have had regarding his tactics. “[A] client should not be required to act as a “hawklike inquisitor” of his own counsel, nor perform incessant checking on counsel.” Aldrich v. San Fernando Valley Lumber Co. (1985) 170 Cal.App.3d 725, 740.

Plaintiff argues that Defendant did not act diligently in making this motion after the date of entry of summary judgment. The motion was made approximately four months after the date of entry of summary judgment. First, the Court notes that the time frame still falls within the six-month requirement of Section 473(b). Second, Defendant and his new counsel have adequately explained the delay because of the need to obtain new counsel, and the time that new counsel had to expend due to the disorganized nature of the case file obtained from prior counsel. (Decl., Kenneth P. White, ¶¶ 2-7.)

Plaintiffs argue that any opposition to the motion for summary judgment would be futile because the granting of the motion was made, in part, on deemed admissions. First, Plaintiffs did not argue that the entire basis for the granting of the motion was deemed admissions. Second, the Court has reviewed the minute order of the motion for summary judgment and the minute order does not reflect that the entire basis of the granting of the motion was on deemed admissions.

Finally, Plaintiff argues that he will be greatly prejudiced by granting relief to Defendant. The Court is mindful that there will be some degree of hardship placed on Plaintiff by the Court’s granting of relief. However, in reviewing and balancing of the equities, the Court determines that not granting relief despite the positive misconduct of Defendant’s former counsel would be inequitable under these circumstances.

The Court notes that Defendant filed a supplemental declaration with the Reply. The Court did not consider this new evidence, which was first filed with the Reply, in the ruling to this motion.

Defendant’s Motion to Vacate Judgment is granted. The Court’s judgment of July 22, 2022 is hereby set aside.

Motion for Attorneys’ Fees Pursuant to CCP 425.16(c)(1)

Code Civ. Proc., § 425.16(c)(1) states: “Except as provided in paragraph (2), in any action subject to subdivision (b), a prevailing defendant on a special motion to strike shall be entitled to recover his or her attorney's fees and costs. If the court finds that a special motion to strike is frivolous or is solely intended to cause unnecessary delay, the court shall award costs and reasonable attorney's fees to a plaintiff prevailing on the motion, pursuant to Section 128.5.” The exceptions noted in paragraph 2 do not apply to this case.

“The fees awarded should include services for all proceedings, including discovery initiated by the opposing party pursuant to section 425.16, subdivision (g), directly related to the special motion to strike.” Jackson v. Yarbray (2009) 179 Cal.App.4th 75, 92–93; See also Tuchscher Development Enterprises, Inc. v. San Diego Unified Port Dist. (2003) 106 Cal.App.4th 1219, 1248 (affirming award of attorney fees including fees incurred in opposing motion for reconsideration.)

Here, Cross-Defendants prevailed on their special anti-SLAPP motion to strike. Thus, Cross-Defendants are entitled to their reasonable attorneys’ fees and costs. The Court notes that attorneys’ fees and costs were previously awarded after the granting of the original anti-SLAPP motion. The instant motion herein simply seeks attorneys’ fees and costs for the time expended in opposition the motion for reconsideration.

“The trial court has “broad authority” to determine the amount of a reasonable attorneys’ fees. PLCM Group v. Drexler (2000) 22 Cal.4th 1084, 1095. “[T]he fee setting inquiry in California ordinarily begins with the ‘lodestar,’ i.e., the number of hours reasonably expended multiplied by the reasonable hourly rate.” Id. [“California courts have consistently held that a computation of time spent on a case and the reasonable value of that time is fundamental to a determination of an appropriate attorneys' fee award.”]. “The experienced trial judge is the best judge of the value of professional services rendered in his court, and while his judgment is of course subject to review, it will not be disturbed unless the appellate court is convinced that it is clearly wrong.” Ketchum v. Moses (2001) 24 Cal.4th 1122, 1132 (internal quotation omitted.) An attorney who works on a contingent fee basis may be entitled to a fee enhancement or multiplier depending on the work involved and nature of the case. See, Id.

Thus, Cross-Defendants are entitled to attorneys’ fees under the lodestar method based on the reasonable amount of time the attorney spent multiplied by a reasonable rate. Cross-Defendant’s counsel Jeffrey M. Rosenfeld provided work on this case, and he states that his hourly rate is $550 per hour (Decl., Rosenfeld, ¶ 8.) In addition, paralegals Leah Vulic and Iyah Turminini provided work on this case with an hourly rate of $205.00 per hour. (Id. at ¶ 9.) The Court finds that, in consideration of the experience of the attorney and paralegals and the nature of the work involved, the reasonable hourly rates charged by the attorney and paralegals are reasonable.

In reviewing the hours expended, the Court finds that the time expended in preparing the opposition to the motion for reconsideration and the instant motion for attorneys’ fees to be reasonable. The Court notes that, while Defendant filed an opposition, the opposition did not consist of significant evidence or argument. Defendant presented arguments regarding the incompetence of his prior counsel, but as noted, the motion for relief above was not directed to the order granting the anti-SLAPP motion. Second, Defendant made a cursory argument regarding the unreasonableness of the fees but did not provide any specific facts or argument to indicate in what manner the fees were excessive, other than Defendant’s own belief that because the motion for reconsideration was shoddy, it should not have taken much time or expense to oppose it.

Therefore, the Court awards attorneys’ fees in favor of Cross-Defendants, and against, Cross-Complainants Joo Hwan Kim and Ta Yeon Park in the sum of $4,192.20.

The parties are directed to confer with the Judicial Assistant and Courtroom Assistant to obtain a new hearing date for the Plaintiff’s Motion for Summary Judgment if Plaintiff still wishes to proceed with the motion.

Defendant is ordered to give notice of this ruling.