Judge Kenneth J. Medel, Case Number: 37-2020-00019044-CU-BC-CTL, Date: 2024-04-05 Tentative Ruling

Judge: Kenneth J. Medel, Case: 37-2020-00019044-CU-BC-CTL, Date: 2024-04-05 Tentative Ruling

SUPERIOR COURT OF CALIFORNIA,

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HALL OF JUSTICE

TENTATIVE RULINGS - April 04, 2024

04/05/2024 09:30:00 AM C-66 COUNTY OF SAN DIEGO

JUDICIAL OFFICER:Kenneth J Medel

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Civil - Unlimited Breach of Contract/Warranty Discovery Hearing 37-2020-00019044-CU-BC-CTL 7TH AVENUE AND A STREET INC VS ONNI CAPITAL LLC [IMAGED] CAUSAL DOCUMENT/DATE FILED: Motion - Other, 10/26/2023

Seventh Avenue and A Street, Inc.'s Motion for Discovery is GRANTED. Further responses are due within 20 days of this order. Sanctions were not included in the Notice of Motion and are not awarded.

This case involves the purchase and sale of an empty commercial lot located on 7th Ave. (where the San Diego County Bar Association used to exist). On December 21, 2022, following a five-day bench trial and post-trial briefing, this Court found for plaintiff 7th Avenue and A Street, Inc. ('7th Avenue') on its breach of contract claim against defendant Onni Capital, LLC ('Onni'). The Court found that Onni breached the parties' real estate purchase contract, that the evidence did not support Onni's claimed justifications for failing to close on its purchase of 7th Avenue's property, and that 7th Avenue is entitled to recover the $2 million earnest money deposit agreed to between the parties. ROA 238.

After a motion for attorney fees, the Court entered a second judgment on May 26, 2023, entitling 7th Ave. to $2 million earnest money deposit, prejudgment interest at 10% per annum, costs of $165,998.65 and attorneys fees of $768,657.50. (ROA 303) 7th has recovered on the earnest money deposit (Chicago Title interpleaded with the Court). However, Onni has not paid on the judgment. Onni has appealed but has not posted a bond to stay enforcement.

On July 12, 2023, 7th served its first post-judgment inspection demand. Objections received as to certain requests (Nos. 8, 13, 15-17 and 23) Onni agreed to produce documents in response to other requests (Nos. 6, 9-12, 14, 16, 19, 20) 7th now states no documents have been produced (other than 13 pages). Further, Onni did not identify which documents produced were produced in response to which requests as required under CCP 2031.280(a).

7th moves to compel.

A judgment creditor may conduct discovery directly against the judgment debtor by means of a judgment debtor examination (708.110), written interrogatories (708.020) and requests for production of documents (708.030). CCP 708.030 requires the judgment debtor to respond to demand for production in the manner and time set forth in the Discovery Act. (CCP 708.030(a)) Post judgment inspection demands are enforced in the same manner as demands in a civil action. (708.030(c)) Onni suggests that 7th Avenue is not entitled to conduct post-judgment discovery because 'the award of Calendar No.: Event ID: TENTATIVE RULINGS

3040637 32 CASE NUMBER: CASE TITLE: 7TH AVENUE AND A STREET INC VS ONNI CAPITAL LLC [IMAGED] 37-2020-00019044-CU-BC-CTL attorneys' fees is an element of cost, not of the money judgment itself.' Opp. at 12:23-24. A money judgment, however, is defined as 'that part of a judgment that requires the payment of money.' C.C.P. § 680.270; see Felczer v. Apple Inc., 63 Cal. App. 5th 406, 415 (2021), as modified (May 24, 2021) ('Under California law, then, any judgment that establishes one party owes the other payment is a money judgment....'). Indeed, C.C.P. § 685.090(b) specifically provides that costs (including for attorneys' fees) 'added to the judgment pursuant to this section are included in the principal amount of the judgment remaining unsatisfied.' Accordingly, '[t]he amount required to satisfy a money judgment is the total amount of the judgment, plus costs added after judgment (including attorney fees), plus accrued interest on the judgment, less payments and any amounts no longer enforceable.' Lucky United Properties Inv., Inc. v. Lee, 185 Cal. App. 4th 125, 139 (2010), as modified on denial of reh'g (June 28, 2010) (citing C.C.P. § 695.210).

Onni Capital, LLC agreed that it would produce documents in response to Request Nos. 6, 9-12, 14, 16, 19, 20, and 22 of 7th Avenue's post-judgment document requests. Yet, based on the motion and largely uncontested in Opposition, it failed to produce what it agreed to produce. Fitzgerald Dec. ¶ 6. A protective order has long been in place in this case (see ROA 42).

Request No. 8 seeks all accounting records of Onni since January 1, 2019. The request is certainly relevant to collection on the judgment.

Request Nos. 13, 15-17 are specifically 'relevant to determining whether other entities could and should be added as judgment debtors under section 187 as alter egos of' Onni. Onni argues in opposition that 7th has not provided evidence to justify this type of discovery - 'predicate evidence justif[ying] such discovery [i.e., discovery as to 'the assets and finances of third parties']. Opp. at 5:1, 5:3. And Onni argues that 7th Avenue's requests are unjustified because 'Plaintiff has no such evidence here [of an alter ego relationship] warranting such an invasion of third party rights.' Opp. at 8:5-8; see also Opp. at 7:8-11 A judgment creditor is entitled to discovery 'relevant to determining whether other entities could and should be added as judgment debtors under section 187 as alter egos of' judgment debtor. See SCC Acquisitions, Inc. v. Superior Ct., 243 Cal. App. 4th 741, 755-6 (2015) This discovery is not discovery on third parties, but on Onni. The defendant, Onni, does not have a third-party's privacy right. As the Court in SCC put it, 'As Western [the propounding party] seeks only documents in the possession or control of SCC, [the responding party], any privacy rights of third party entities already have been compromised if not altogether waived. A protective order can be issued, if necessary, to safeguard any remaining privacy rights.' SCC, 243 Cal. App. 4th at 756. If Onni has the requested documents, if they are in its possession, custody, or control, then Onni is obliged to produce them.

REQUEST FOR PRODUCTION NO. 23 seeks 'All non-privileged DOCUMENTS mentioning, referring, or relating to ONNI's plans to satisfy or resist the judgment in this action.' Any non-privileged documents (or documents not protected by attorney work product protection) are to be produced.

Motion to Seal Though not calendared, 7th files a separate motion to seal this motion and related documents. The motion is DENIED.

Specifically, under California Rule of Court 2.551(b)(1), 7th Avenue seeks to seal the following documents: 1) Portions of 7th Avenue and A Street, Inc.'s Memorandum of Points and Authorities Calendar No.: Event ID: TENTATIVE RULINGS

3040637 32 CASE NUMBER: CASE TITLE: 7TH AVENUE AND A STREET INC VS ONNI CAPITAL LLC [IMAGED] 37-2020-00019044-CU-BC-CTL in Support of its Motion to Compel Compliance with Discovery Responses, Production of Documents, and Further Responses, specifically, certain information Onni designated confidential that is disclosed therein.

2) Portions of the Fitzgerald Declaration, specifically, certain information Onni designated confidential that is disclosed therein.

3) Exhibit 4 to the Fitzgerald Declaration, which are financial and business-related documents that Onni produced in response to 7th Avenue's post-judgment document requests.

According to 7th, 'these papers contain information that Onni has designated as Confidential under the Stipulated Protective Order in this action. Exhibit 4 consists of Onni's document production in response to 7th Avenue's post judgment document requests, which Onni designated as 'Confidential.' 7th Avenue's papers reference those documents.' A confidentiality agreement alone is not a basis to seal record. Pursuant to CRC 2.551(a), the court must not permit a record to be filed under seal based solely on the agreement or stipulation of the parties.

As recognized in the motion, a party may apply to a court for an order sealing court records under California Rule of Court 2.551(b)(1). The Court may grant the application and seal the records if it finds: 1) There exists an overriding interest that overcomes the right of public access to the record; 2) The overriding interest supports sealing the record; 3) A substantial probability exists that the overriding interest will be prejudiced if the record is not sealed; 4) The proposed sealing is narrowly tailored; and 5) No less restrictive means exist to achieve the overriding interest.

California Rule of Court 2.550(d); NBC Subsidiary (KNBC-TV), Inc. v. Superior Court, 20 Cal. 4th 1178, 1217–18 (1999).

7th argues only that 'Onni may contend that it has an overriding interest in keeping its financial and business information confidential, that that overriding interest supports sealing such information, and that Onni will be prejudiced if its financial and business information is made public.' Onni has not made such a showing. This Court has no basis in law or fact to seal the record.

The Court orders that any unredacted papers be filed forthwith.

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