Judge: Gregory Keosian, Case: 21STCV00005, Date: 2023-04-06 Tentative Ruling

Case Number: 21STCV00005    Hearing Date: April 6, 2023    Dept: 61

Defendant LETR, Inc.’s Motion to Quash Subpoenas to JP Morgan Chase National Corporate Bank, Heartland Credit Union Bank, Bank of America Bank, Wells Fargo Bank, and the CPA office of Fenton & Ross is DENIED.

I.                         MOTION TO QUASH DEPOSITION SUBPOENA

“If a subpoena requires the attendance of a witness or the production of books, documents, electronically stored information, or other things before a court, or at the trial of an issue therein, or at the taking of a deposition, the court, upon motion reasonably made by any person described in subdivision (b), or upon the court's own motion after giving counsel notice and an opportunity to be heard, may make an order quashing the subpoena entirely, modifying it, or directing compliance with it upon those terms or conditions as the court shall declare, including protective orders. In addition, the court may make any other order as may be appropriate to protect the person from unreasonable or oppressive demands, including unreasonable violations of the right of privacy of the person.” (Code Civ. Proc. § 1987.1, subd. (a).) A party may bring a motion under this section. (Code Civ. Proc. § 1987.1, subd. (b)(1).)

Defendant LETR Inc. moves to quash subpoenas issued by Plaintiffs Sunset Twins-BW LLC and Sunset Twins HH-LLC (Plaintiffs) to third parties JP Morgan Chase National Corporate Bank, Heartland Credit Union Bank, Bank of America Bank, Wells Fargo Bank, and the CPA office of Fenton & Ross, seeking documents related to LETR, including LETR’s file with their CPA, and documents showing withdrawals, deposits, and communications related to LETR’s bank accounts. (Motion Exh. A.) LETR characterizes these records as private and unsupported by good cause. (Motion at pp. 2–3.)

Plaintiffs in opposition argue that the motion contains no separate statement and was not preceded by meet-and-confer efforts. (Opposition at p. 7.) Plaintiffs further argue that the subpoenas here are necessary to support Plaintiffs’ allegations of an alter ego relationship between Defendants LETR and Tatiana Rozenberg, as well as to support the fourth cause of action for fraudulent transfer. (Opposition at pp. 3–7.)

“In determining whether disclosure is required [against a privacy objection], the court must indulge in a ‘careful balancing’ of the right of a civil litigant to discover relevant facts, on the one hand, and the right of the third parties to maintain reasonable privacy regarding their sensitive personal affairs, on the other. The court must consider the purpose of the information sought, the effect that disclosure will have on the affected persons and parties, the nature of the objections urged by the party resisting disclosure and availability of alternative, less intrusive means for obtaining the requested information. Based on an application of these factors, the more sensitive the nature of the personal information that is sought to be discovered, the more substantial the showing of the need for the discovery that will be required before disclosure will be permitted.” (Hooser v. Superior Court (2000) 84 Cal.App.4th 997, 1004, internal citations omitted.)

“The corporate right to privacy is a lesser right than that held by human beings and is not considered a fundamental right.” (SCC Acquisitions, Inc. v. Superior Court (2015) 243 Cal.App.4th 741, 756.) And while a person has a limited privacy interest in financial records (See International Federation of Professional & Technical Engineers, Local 21, AFL-CIO v. Superior Court (2007) 42 Cal.4th 319, 330), this interest is subject to the balancing test described above.

Balancing of the interests in privacy and discovery here supports allowing the discovery that Plaintiffs seek. LETR’s right to privacy in its financial records is not akin to a natural person’s, and LETR’s argument for its privacy interest consists only of a summary invocation. Conversely, LETR’s financial affairs are relevant to the subject matter of this litigation, as they may support the existence of an alter-ego relationship with its owner, Rozenberg, and of financial transactions designed to avoid LETR’s debt to Plaintiffs.

The motion is therefore DENIED.