Judge Holly J. Fujie, Case Number: 22STCV03944, Date: 2024-01-11 Tentative Ruling

On February 9, 2024, Plaintiff Yogi Securities Holdings, LLC (“Plaintiff”) filed this operative Third Amended Complaint (“TAC”) against Defendants Jona Rechnitz, Robert Rechnitz, JSR Capital, LLC, Alan “Avi” Golombeck, Agol Holdings, LLC, Ayal Frist, Stateland Brown, LLC, and DOES 1-100 for (1) Breach of Contract – Count 1; (2) Breach of Contract – Count 2; (3) Breach of Fiduciary Duty; (4) Breach of Guaranty; (5) Conversion; (6) Negligence Misrepresentation; (7) Fraud and Concealment; and (8) Civil Theft (Cal. Penal Code, § 496).

On October 16, 2023, Defendant JSR Capital, LLC (“JSR”) filed this instant Motion for Protective Order. On February 16, 2024, Plaintiff filed its opposition. On March 11, 2024, JSR filed its reply.

Pursuant to Code of Civil Procedure Section 2017.020, subdivision (a), “The court shall limit the scope of discovery if it determines that the burden, expense, or intrusiveness of that discovery clearly outweighs the likelihood that the information sought will lead to the discovery of admissible evidence. The court may make this determination pursuant to a motion for protective order by a party or other affected person. This motion shall be accompanied by a meet and confer declaration under Section 2016.040.” (Code Civ. Proc., § 2017.020, subd. (a).)

“Notwithstanding subdivision (a), on motion and for good cause shown, the court may establish the sequence and timing of discovery for the convenience of parties and witnesses and in the interests of justice.” (Code Civ. Proc., § 2019.020, subd. (b).)

JSR moves for a protective order extending the response time for JSR to respond to Plaintiff’s first set of document demands (“the Discovery”) comprising 48 document demands for at least 60 days; and attorney’s fees and costs against Plaintiff and its counsel, Ronald Richards and Geoffrey Long in the sum of $5,312.00. JSR argues good cause exists because (1) recent past and upcoming health issues of JSR’s counsel, Robert Hirsh (“Hirsh”); (2) JSR being unavailable to respond to the Discovery due to the timing of its service within the Jewish holidays; and (3) Hirsh has offered to continue trial so that no prejudice is suffered by anyone, but Plaintiff has refused.

Specifically, JSR contends Plaintiff’s counsel have been repeatedly informed of JSR’s managing member, Jona Rechnitz’s religious observance of Jewish holidays. JSR further contends the Discovery was served on September 19, 2023, within the Jewish holiday period that started on Rosh Hashanah and ended with Simchas Torah, Sunday night October 8, 2023. JSR asserts due to Rechnitz’s religious observance, he did not work the entire holiday period. Moreover, JSR asserts Plaintiff’s counsel have repeatedly been informed about Hirsh’s very serious health issues, which nearly resulted in his death in September 2023 and Hirsh’s October 27, 2023 surgery, with an estimated four week recovery period. JSR also argues Plaintiff still refused to provide JSR with a requested 60-day extension to respond to Plaintiff’s first set of document demands.

In opposition, Plaintiff argues the motion is moot as to the request for a 60-day extension of time, to December 22, 2023, to respond to the Discovery because JSR has had 164 days to respond but still has failed to do so. As such, Plaintiff contends JSR effectively obtained its 60-day extension and then some, by filing this present motion. Furthermore, Plaintiff asserts refusing to grant a 60-day extension on responses pushing the response date up against the then discovery cut-off is not sanctionable conduct. Moreover, Plaintiff contends JSR’s request for an extension was coupled with a request for a trial continuance, so refusing those requests is not sanctionable. Additionally, Plaintiff argues this motion’s only purpose was to continue to delay discovery and force Plaintiff to incur attorneys’ fees. Lastly, Plaintiff asserts JSR’s speculation about the timing of service of the discovery is false because the timing was intended to allow receipt of responses and responsive documents prior to JSR’s deposition that was noticed for November 28, 2023 and prior to the then discovery cut-off tied to the prior January 2024 trial date. Plaintiff requests sanctions against Hirsh for unsuccessfully making this motion and advising the conduct leading to this motion in the amount of $5,450.00.

In reply, JSR concedes that the first part of its motion is moot because the requested time period has passed for extending the time for response to the Discovery. By contrast, JSR argues the issuance of a sanctions award against Plaintiff and its counsel is not moot because the motion is meritorious. JSR contends it was forced to filed this instant motion because Plaintiff and its counsel refused to provide a discovery extension when Hirsh was physically unable to address them due to his 2023 health issues and JSR’s principal’s unavailability due to religious requirements. Thus, JSR argues the sanctions sought by the motion should be awarded as there was no substantial justification for Plaintiff and its counsels’ conduct. Likewise, JSR contends Plaintiff’s request for sanctions against Hirsh is meritless and malicious and should be denied. JSR asserts Hirsh has not engaged in any sanctionable conduct and despite Plaintiff never having filed a motion to compel responses to the Discovery, Hirsh reached out to Plaintiff’s counsel on several occasions in an attempt to resolve all matters relating to the Discovery, which Plaintiff rejected.

The Court finds that the bases for the first part of the motion are moot but were meritorious at the time of the filing of the motion. JSR’s counsel Hirsh had informed Plaintiff’s counsel regarding his health issues and the religious observance of Jona Rechnitz. Hirsh had further informed Plaintiff that these two issues disrupted his ability to respond to the Discovery and requested an extension of 60-days. Plaintiff concedes that it refused to provide the 60-day extension and trial continuance despite knowledge of Hirsh’s health issues and Rechnitz’s religious requirements. Plaintiff also maintains its actions are not sanctionable conduct. However, Plaintiff has not demonstrated it acted with substantial justification in refusing to deny the 60-day extension and trial continuance provided the issues raised by JSR concerning its counsel’s health issues and principal’s religious requirements that interfered with JSR serving responses to the Discovery. Similarly, JSR does not dispute that it still has not provided the responses and responsive documents to the Discovery despite receiving an extension by virtue of the filing of this present motion. Thus, these circumstances make the imposition of sanctions on either party unjust.

Pursuant to Code of Civil Procedure Section 2017.020, subdivision (b), “The court shall impose a monetary sanction under Chapter 7 (commencing with Section 2023.010) against any party, person, or attorney who unsuccessfully makes or opposes a motion for a protective order, 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., § 2017.020, subd. (b).)

As discussed above, neither party have shown that imposition of sanctions is warranted against the other party concerning this motion.

Therefore, the Motion for Protective Order is DENIED. The request for sanctions is also DENIED.

Parties who intend to submit on this tentative must send an email to the Court at SMC_DEPT56@lacourt.org as directed by the instructions provided on the court website at www.lacourt.org. If the department does not receive an email and there are no appearances at the hearing, the motion will be placed off calendar.

Hon. Holly J. Fujie

Judge of the Superior Court