Judge: Israel Claustro, Case: 22D000242, Date: 2023-08-11 Tentative Ruling
MOTION: Compliance with Subpoena
Moving Party: Respondent Elliot Cameron (“MP”)
Responding Party: JP Morgan Securities (3rd Party) (“JPM”)
MOTION filed & served on: 5/4/23 & served on Petitioner on 5/9/23
& served on RP on 5/23/23
OPPOSITION filed & served on: None
REPLY filed & served on: None
MOVING PAPERS
MP issued a subpoena to JPMorgan (“JPM”)which included request no. 18: a simple request for written communications between Petitioner and her Private Client Advisor at JPMorgan, David Jeffrey between 2016 to present. Even after agreeing to limit the scope from 2018 to present, JPM demanded a cost estimate of $29,000.00 for such a simple request that would be charged by a third party vendor that they refused to identify, let alone provide an itemization of costs for. Despite four different efforts to meet and confer, JPM refused to resolve the foregoing issue. No. 18 reads: “From April 1, 2016 to the date of production, all copies of all written communications (including, but not limited to, online web forms , e-mails, facsimiles, text messages, phone calls (including but not limit ed to call logs and recorded calls) between Britt any Cameron, Brittany Burden, or Brittany Leslie (last 4 social security # [redact ed for privacy]) and Private Client Advisor at JPMorgan Chase Bank N.A., David Treffry.”
Facts Alleged: MP issued a depo subpoena for production of business records and related consumer notice to JPM’s custodian of records on 2/6/23. The same was served on Petitioner’s counsel that same day before subsequent personally served on JPM on 2/16/23.
OPPOSITION PAPERS
None.
REPLY
None.
Legal Authority
A deposition subpoena may command the production of business records for copying without actual attendance at a deposition (“business records subpoena”). (C.C.P. §§ 2020.020(b).) A business records subpoena requires production within 15 days after service or 20 days after issuance, whichever is later. No showing of good cause is required to enforce a business records subpoena—moreover the burden is usually on the person seeking to prevent disclosure to show grounds for a protective order or motion to quash. ([8:535] Cal. Prac. Guide Civ. Pro. Before Trial Ch. 8E-6.) “Business records” includes every kind of record prepared by every kind of business, governmental activity, profession, or occupation, whether for profit or not. (See Ev. Code §§ 1270, 1560(a).)
Personal service of a deposition subpoena obligates any resident of California to appear, testify, and/or produce whatever documents or things are specified in the subpoena; and to appear in any proceedings to enforce discovery. (C.C.P. § 2020.220(c).)
A deposition subpoena is enforceable by a motion to compel compliance under C.C.P. § 1987.1. ([8:609] Cal. Prac. Guide Civ. Pro. Before Trial Ch. 8E-6.) If a nonparty disobeys a depo subpoena, the subpoenaing party may seek a court order compelling the nonparty to comply with the subpoena within 60 days after completion of the deposition record. (C.C.P. § 2025.480(b); see Unzipped Apparel, LLC v. Bader (2007) 156 Cal.App.4th 123, 127.)
Procedural Analysis
Timeliness
Deadline = 60 Days after Completion of Depo Record
If a nonparty disobeys a depo subpoena, the subpoenaing party may seek a court order compelling the nonparty to comply with the subpoena within 60 days after completion of the deposition record. (C.C.P. § 2025.480(b); see Unzipped Apparel, LLC v. Bader (2007) 156 Cal.App.4th 123, 127.) This rule applies to subpoenas for production of documents at a deposition and also to business records subpoenas. The objections or other responses to a business records subpoena are the “deposition record” for purposes of measuring the 60-day period for a motion to compel. (Unzipped Apparel, LLC v. Bader, supra, 156 CA4th at 132-133, 67 CR3d at 116-117; Rutledge v. Hewlett-Packard Co. (2015) 238 CA4th 1164, 1192, 190 CR3d 411, 434.) This deadline is mandatory and jurisdictional. (Weinstein v. Blumberg (2018) 25 Cal.App.5th 316, 235; Sexton v. Superior Court (1997) 58 Cal. App. 4th 1403, 1410 [late-filed motion to compel must be denied where objection raised at hearing even if omitted in opposition papers].)
Depo Record = Date of Production
The deposition record is “complete” as of the “date specified for production” or the date objections are served. It is irrelevant that some documents might be produced thereafter. (Board of Registered Nursing v. Sup.Ct. (Johnson & Johnson) (2021) 59 Cal.App.5th 1011, 1032-1033.) In Board of Registered Nursing, the appeal court went through the various circumstances that trigger the running of the statute. It also discussed how discovery against nonparties is more limited and streamlined than discovery between parties. That the purpose for the deadline was to prevent nonparties from being subject to protracted litigation over discovery. With that in mind, the appeal court stated at 1034-1035: Defendants point out that the Medical Board and Pharmacy Board eventually produced some documents in response to the subpoena. They argue that “requiring an earlier motion on some discrete portion of the discovery request—while production and negotiation on others continued—would encourage piecemeal litigation burdening not only courts, but nonparties forced to answer multiple motions arising from the same subpoena.” Defendants misunderstand the statutory scheme. A nonparty must comply (or not) with the subpoena on the date specified for production. If a party is not satisfied with the nonparty's compliance, the party has 60 days in which to meet and confer with the nonparty. These meet and confer efforts do not affect the mandatory 60-day deadline. The meet and confer process is part of the 60-day period in which to file a motion; it does not extend it. If the party is still unsatisfied with the nonparty's compliance with any portion of the subpoena at the end of this period (because, for example, the nonparty still has not produced the requested documents), the party may file a motion to compel. This motion to compel must encompass any issue the subpoenaing party wishes to raise regarding the nonparty's compliance. There is no opportunity or occasion to file multiple, piecemeal motions to compel.
Service
A motion is deemed to have been “made” and pending before the court upon the due service and filing of the notice of motion. (C.C.P. § 1005.5.) A motion to compel further responses to a deposition is not "made" until the required supporting papers are served. (Weinstein v. Blumberg (2018) 25 Cal.App.5th 316, 235; 27B Cal. Jur. 3d Discovery and Depositions § 133.) Where a party does not obtain trial court relief from the statutory deadline for filing a motion to compel further production regarding a deposition notice or subpoena, failure to move for further answers within the statutory time forecloses further relief. (Weinstein, supra [Defendant's motion to compel further responses to deposition was not “made” until required supporting papers were served, and thus motion was not timely; supporting papers were not filed until 15 days before hearing on motion, which took place well outside 60-day time period for filing a motion to compel following a deposition].)
A motion to compel must have been brought within 60 days of the completion of the deposition record. The deposition record is “complete” as of the “date specified for production” or the date objections are served.
In this case, JPM did not serve objections, so the deadline tolls on the date specified for production, which is 3/21/23. + 60 days is Saturday 5/20/23. Since the deadline falls on a Saturday, it is moved to the next court date, which is Monday 5/22/23.
This motion was filed on 5/4/23, which is timely.
The motion was served on JPM on 5/9/2023, which was timely.
Meet & Confer
This motion shall be accompanied by a meet and confer declaration under C.C.P. § 2016.040. (C.C.P. § 2025.480(b).) ([8:535] Cal. Prac. Guide Civ. Pro. Before Trial Ch. 8E-6.)
This requirement is satisfied. MPC went back and forth with JPM numerous times, making different compromises and concessions to the discovery in an effort to obtain compliance.
Good Cause
A showing of “good cause” is required on motions to compel document discovery from a party under C.C.P. § 2025.450(b)(1) (depositions) or § 2031.310(b)(1) (inspection demands). But the relevant statutes do not specify such requirement on a motion to compel a nonparty to comply with a deposition subpoena for document production (see C.C.P. §§ 1987.1, 2025.480). At least one court has held that if there is a “good cause” showing required to compel production of party documents, such a requirement also applies to nonparty production. (Calcor Space Facility, Inc. v. Sup.Ct. (Thiem Indus., Inc.) (1997) 53 Cal.App.4th 216, 223-224 “since it is unlikely the Legislature intended to place greater burdens on a nonparty than on a party to the litigation, we read a similar [good faith] requirement” into the relevant statutes].)
MP has satisfied this requirement. MP sets forth good cause as follows:
“The foregoing documents are necessary because at her deposition, Petitioner identified that Mr. Treffrey has access to making decisions on her stock broker age including access to transferring money to and from her stock brokerage and checking accounts account where community property assets were held. When Petitioner was asked about why certain funds were transferred from a community checking account to stock brokerage accounts that were solely under her name, she repeatedly answered that she did not know ( Ex. H). Therefore, communications between Petitioner and Mr. Treffrey are probative of the issue as to why community funds were transferred from a checking account that held community income and into Petitioner’s JPMorgan brokerage accounts that are solely under her name.”
Substantive Analysis
JPM’s position (as alleged in the moving papers, although there’s no opposition from JPM filed) is that their cost for complying with the subpoena is $29k—this is the “actual pass-through cost from the third-party vendor for the retrieval of records held offsite”. JPM did not upon request produce an itemized statement, provide identity of the third party that would charge MP directly, or permit MP to hire a professional to go to the location and make copies of the records directly.
Reasonable Costs
Ev. Code 1563(b)(4) and (3):
“(4) The requesting party may petition the court in which the action is pending to recover from the witness all or a part of the costs paid to the witness, or to reduce all or a part of the costs charged by the witness, pursuant to this subdivision, on the grounds that those costs were excessive. Upon the filing of the petition the court shall issue an order to show cause and from the time the order is served on the witness the court has jurisdiction over the witness. The court may hear testimony on the order to show cause and if it finds that the costs demanded and collected, or charged but not collected, exceed the amount authorized by this subdivision, it shall order the witness to remit to the requesting party, or reduce its charge to the requesting party by an amount equal to, the amount of the excess. If the court finds the costs were excessive and charged in bad faith by the witness, the court shall order the witness to remit the full amount of the costs demanded and collected, or excuse the requesting party from any payment of costs charged but not collected, and the court shall also order the witness to pay the requesting party the amount of the reasonable expenses incurred in obtaining the order, including attorney's fees. If the court finds the costs were not excessive, the court shall order the requesting party to pay the witness the amount of the reasonable expenses incurred in defending the petition, including attorney's fees.”
“(3) The witness shall submit an itemized statement for the costs to the requesting party, or the requesting party's deposition officer, setting forth the reproduction and clerical costs incurred by the witness. If the costs exceed those authorized in paragraph (1), or if the witness refuses to produce an itemized statement of costs as required by paragraph (3), upon demand by the requesting party, or the requesting party's deposition officer, the witness shall furnish a statement setting forth the actions taken by the witness in justification of the costs.”
If the witness to whom the subpoena for business records is directed is not a party to the action, “reasonable costs” incurred in producing the records (pursuant to Ev.C. § 1560(b), (c) & (d)) “shall be” charged against the party serving the subpoena; and, upon demand, these costs must be paid as a prerequisite to the witness's duty to deliver the records. (But the requesting party is entitled to an itemized costs statement from the witness; and may petition the court to reduce all or part of the charges, or to recover all or part of the costs already paid the witness, on grounds that the costs were excessive. (E. Securing Witness Attendance and Document Production at Trial, Cal. Prac. Guide Family L. Ch. 11-E.)
“Reasonable costs” include, but are not limited to, the following:
- the custodian's clerical expense in locating the records and making them available (billed at a maximum rate of $24 per hour per person, computed at $6 per quarter hour or fraction thereof);
- actual costs charged by a third party for retrieving them and returning them to storage;
- copying costs (computed at $.10 per page; $.20 from microfilm); and
- actual postal charges.
(Ev. Code § 1563(b)(1).)
Ev C § 1563 provides that a witness is entitled to all reasonable costs incurred in the production of records, but per Ev. C. § 1563(b)(4), a witness who charges excessive costs in bad faith is liable for the requesting party's attorney's fees. (See In re Marriage of Stephens (1984) 156 Cal.App.3d 909, 203 [no entitlement to attorney's fees per Ev C § 1563(b)(4); no evidence of bad faith]; III. [§ D.23] Depositions, CFLR Cal. Fam. L. Prac. § D.III.)
The subpoenaing party can petition the court to recover excess charges paid to obtain such records. The court can award costs and fees against the custodian if it finds “bad faith” (and, conversely, against the subpoenaing party if the charges are found not excessive). (Ev.C. § 1563(b)(4)]; 6. [8:535] SUBPOENA to Nonparty Deponent or Business Records Custodian:, Cal. Prac. Guide Civ. Pro. Before Trial Ch. 8E-6.)
The party requesting production (or that party's deposition officer) is not required to pay for reproduction until the documents are produced, but if the requesting party does not tender full payment with delivery, the custodian of records is not required to deliver the records. (Ev C § 1563(b)(2).)
Here, JPM is entitled to reasonable costs incurred in the production of the records, which includes the actual costs charged by a third party for retrieving them and returning them to storage. However, JPM’S provided estimate of $29k does appear excessive, although without an itemized cost statement it is difficult to determine.
Sanctions
The court shall impose a monetary sanction under Chapter 7 (commencing with § 2023.010) against any party, person, or attorney who unsuccessfully makes or opposes a motion to compel, unless it finds that the one subject to the sanction acted with substantial justification or other circumstances make the imposition of the sanction unjust. (C.C.P. § 2025.480(j).)
A witness who charges excessive costs in bad faith is liable for the requesting party's attorney's fees. (See In re Marriage of Stephens (1984) 156 Cal.App.3d 909, 203 [no entitlement to attorney's fees per Ev C § 1563(b)(4); no evidence of bad faith]; III. [§ D.23] Depositions, CFLR Cal. Fam. L. Prac. § D.III.)
TENTATIVE RULING
The Court orders all parties to appear on August 18, 2023 at 8:30 A.M. which the court sets as an OSC to hear evidence on the reasonableness of JPM’s demanded production costs, in compliance with Ev. C. § 1563(b)(4). At that time, the court will consider sanctions, attorneys’ fees and costs.
Moving Party ordered to give notice.