Judge Glenda Sanders, Case 2016-00894459 2022-12-29 Tentative Ruling

Judge: Glenda Sanders, Case: 2016-00894459, Date: 2022-12-29 Tentative Ruling

Re Bert L. Howe & Associates

Plaintiffs Justine Anderson, Adam DeMichele, Christine DeMichele, Vance Raine (minor), Cheryl Dean, Robert Ikehorn, Gerald Jeras Ikehorn, Lindzee Bracho, Melinda Michaleryda, Michael Sayegh, Michelle Stotler, Randall Stotler, Tonda Wilkinson, Charles Jay Leonard, Mark Nadeski, Catherine Duboc, and Ann Amogida (collectively Plaintiffs) seek to compel compliance with a business records subpoena to third party, Bert L. Howe & Associates (BHA). BHA was hired by Western National Construction as its expert in a prior litigation by Defendants against Western National Construction. ROA 989, Turgliatto Decl., ¶3. In that prior litigation, Defendants contended that Western National defectively constructed the Newport Bluffs apartments resulting in water intrusion and mold. ROA 960, Sampson Decl., ¶12.

As an expert in the prior litigation, BHA conducted inspections, took photographs and measurements of alleged defective construction, prepared bids, estimates and allocation summaries, and prepared reports. Thus, there is no dispute that the information and records sought are relevant to the issues in this case.

The day before the date set for production, BHA served objections and refused to produce any documents. ROA 960, Sampson Decl., Ex. B. BHA argues that because it was not deposed and its expert file was not produced in the prior litigation, all the requested information and records are attorney work product and not subject to disclosure. BHA also contends that certain records, such as the bids and estimates are trade secrets. Further, based on Urban Pacific Equities Corp. v. Superior Court (1997) 59 Cal. App. 4th 688 (Urban), BHA contends that the requested information and records are its business product and that it must be paid a reasonable fee for its business product. Finally, BHA objected on the grounds of financial privacy but has made no argument in its opposition in support of this objection. Therefore, the Court considers this objection to be abandoned.

Contrary to Plaintiffs’ arguments, BHA’s objections are timely. (Monarch Healthcare v. Sup.Ct. (2000) 78 CA4th 1282, 1290 [nonparty deponent or business records custodian may, prior to the date of production, serve on the subpoenaing party, the witness, and the deposition officer, a written objection that cites the specific grounds on which production of the personal records should be prohibited, or may wait until the deposition and object at that time].)

Contrary to BHA’s argument, it does not appear that the work product doctrine applies here. Once an expert is designated to testify, the work product doctrine does not apply and the expert is subject to pretrial discovery:

The situation is different, however, with a testifying expert. As a general rule, neither the attorney-client privilege nor the work product protection will prevent disclosure of statements to, or reports from, a testifying expert. When a client calls that party's attorney to testify at trial to information the attorney could have only learned through the attorney-client privilege, the privilege is waived. “It follows that the same waiver exists when an agent of the attorney is to testify to matters that he could only have learned because of the attorney-client relationship.” (National Steel Products Co. v. Superior Court, supra, 164 Cal.App.3d at p. 484, 210 Cal.Rptr. 535.) Once a testifying expert is designated as a witness, the attorney-client privilege no longer applies, “because the decision to use the expert as a witness manifests the client's consent to disclosure of the information.” (Shadow Traffic Network v. Superior Court, supra, 24 Cal.App.4th at p. 1079, 29 Cal.Rptr.2d 693.) Similarly, when an expert witness is expected to testify, the expert's report, which was subject to the conditional work product protection, becomes discoverable, as the mere fact that the expert is expected to testify generally establishes good cause for its disclosure.19 (Williamson v. Superior Court, supra, 21 Cal.3d at pp. 834–835, 148 Cal.Rptr. 39, 582 P.2d 126.)

* * *

Case authority has drawn a bright line at the point where it becomes reasonably certain that the expert will testify—holding that the attorney-client privilege and work product protection apply prior to the point, but not subsequent to it. (See, e.g., People v. Milner (1988) 45 Cal.3d 227, 241, 246 Cal.Rptr. 713, 753 P.2d 669; Williamson v. Superior Court, supra, 21 Cal.3d at pp. 834–835, 148 Cal.Rptr. 39, 582 P.2d 126; Sanders v. Superior Court (1973) 34 Cal.App.3d 270, 278–279, 109 Cal.Rptr. 770.

(De Luca v. State Fish, Inc. (2013) 217 Cal.App.4^th 671, 688-690; Cnty. of Los Angeles v. Superior Ct. (1990) 222 Cal. App. 3d 647, 654–55 [“Under discovery rules, however, once it appears reasonably certain that the consultant-expert ‘will give his [or her] professional opinion as a witness on a material matter in dispute,’ the attorney's work product privilege terminates and the expert's knowledge and opinions are subject to discovery and disclosure.”].) However, a party may reestablish the work product privilege if that party formally withdraws the expert witness at any time prior to disclosure of that witness' proposed testimony and continues to engage that expert as a consultant. (Cnty. of Los Angeles, 222 Cal.App.3^rd at 657-658.)

Here, it is undisputed that BHA was retained as an expert in and designated as a testifying expert for Western National Construction in the prior litigation. ROA 989, Turgliatto Decl., ¶¶3-4. Although BHA did not actually testify or produce its expert report, there is no evidence that BHA was withdrawn as an expert. Consequently, the Court concludes that the attorney work product doctrine does not apply here.

However, the Court further concludes that BHA's contention that many of the requested documents constitute its business product, and not its business records, is well taken.

Urban explains that a business records subpoena could not be used to obtain the product of a business, in that case, a deposition transcript:

The transcript of Ihnen's deposition is the product of Miller & Company's business, not a record of its business, and we do not think “business records” includes the product of a business entity. Rather, as used in section 2020, subdivision (d), we think “business records” means an item, collection, or grouping of information about a business entity. (Compare Civ. Code, § 1799, subd. (e); see also Black's Law Dict. (6th ed. 1990) p. 199, col. 1 [defining “business records” as “[j]ournals, books of account and other records”].)

In a case in which one of the parties wanted to examine a Ford Explorer, he could not obtain one by serving a business records subpoena on Ford Motor Company, notwithstanding that (leaving to one side all other objections) he could use a business records subpoena to obtain Ford's actual business records (that is, unprivileged information about how it makes its Explorers, the cost thereof and so on)-because the Explorer is Ford's product, not part of its business records.

(Urban, supra, 59 Cal. App. 4th at 693–94.)

Here, BHA properly objected to Categories 1, 2, 4, and 6 as calling for its business product. Apparently because Plaintiffs refused to concede the distinction between business product and business records, there is no indication that the parties met and conferred as to an appropriate payment for the business product being requested.

BHA also contends that its “materials, communications and billings” are trade secrets. ROA 981, Opp., p. 7. More specifically, BHA contends it has proprietary processes that it uses to prepare reports, repair estimates and costs estimates, which it contends are trade secrets. ROA 987, Barana Decl., ¶¶4-5. But, as Plaintiffs correctly note, as a designated expert BHA would be required to disclose its methodologies and testify about them. This information therefore does not qualify as trade secrets.

Accordingly, the Court continues the motion as to Category Nos. 1, 2, 4, and 6, to January 26, 2023 at 2 PM. The parties are ordered to meet and confer concerning appropriate payment for the business product being requested, and each side may file a supplemental brief by not later than January 20, 2023.

The motion is granted as to Category No. 3, as none of the objections noted in BHA's Response to Category No. 3 are valid. The motion is granted as to Category No. 5, as such information became discoverable upon BHA being designated as an expert.

Plaintiffs are Ordered to file a proposed Order within 5 court days, and to give notice.

Re International Well Building Institute, PBC

Defendants The Irvine Company Apartment Communities, Inc., Newport Bluffs, LLC, and The Irvine Company, LLC (collectively, Defendants) move to quash and/or move for a protective order regarding Plaintiffs’ Deposition Subpoena for Production of Business Records to International Well Building Institute, PBC (IWBI Subpoena). Defendants contend the IWBI Subpoena is overbroad as to time and scope, and therefore, not reasonably calculated to lead to the discovery of admissible evidence. Specifically, Defendants contend all Plaintiffs lived in the Newport Bluffs apartment complex in 2017 or earlier, yet the IWBI Subpoena does not have any limitation as to time. Defendants contend IWBI did not establish the WELL Health & Safety rating until 2020 and the Irvine Company Apartment Communities did not obtain the WELL Health & Safety certification until 2021, well after all plaintiffs vacated the Newport Bluffs community. Further, Defendants have represented they will not make reference to this rating because it was obtained well after Plaintiffs’ vacated and in response to the COVID pandemic. As such, Defendants request that the subpoena be limited to 2009-2017.

Plaintiffs have agreed to limit the scope of the subpoena to the Newport Bluffs apartment community only. But Plaintiffs decline any further limitation on time. Plaintiffs contend the IWBI Subpoena is reasonably calculated to lead to the discovery of admissible evidence because there may be information about the condition of the property and discussions between IWBI and Defendants that confirm Plaintiffs’ claims or not. Further, Plaintiffs present evidence that IWBI initiated its wellness standard as early as 2014.

The Court agrees that there is good cause for the production, but not with an unlimited time scope. The only challenge to Defendants’ contention that no plaintiff resided in the Newport Bluffs apartments after 2017 is the hearsay statement by one of Plaintiffs’ counsel (Benjamin Sampson). It is unclear how any conditions occurring later than 2018 could reasonably be calculated to show conditions in 2017 or earlier.

Accordingly, the motion to quash is denied, but the Court orders that the documents requested be limited to the Newport Bluffs Apartment Homes, for the period 2009-2018.

Defendants are ordered to file a proposed Order within 5 court days, and to give notice.