Judge Lynne M. Hobbs, Case Number: 21STCV10542, Date: 2023-10-06 Tentative Ruling

Judge: Lynne M. Hobbs, Case: 21STCV10542, Date: 2023-10-06 Tentative Ruling

Case Number: 21STCV10542 Hearing Date: December 15, 2023 Dept: 30

RAFAEL QUIJANO vs POSTMATES, INC.

TENTATIVE

Defendant’s motion for sanctions pursuant to CCP section 128.7 is DENIED. Plaintiff’s request for sanctions is DENIED. Plaintiff to give notice.

Legal Standard

CCP section 128.7 states that a court may impose sanctions on a party or attorney that presents a pleading, petition, motion, or other similar papers in the following circumstances:

1) the document is presented primarily for an improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation.

2) the claims, defenses, and other legal contentions therein are not warranted by existing law or by a nonfrivolous argument for the extension, modification, or reversal of existing law or the establishment of new law.

3) the allegations and other factual contentions have no evidentiary support;

4) the denials of factual contentions are not warranted on the evidence.

CCP section 128.7 permits the Court to impose monetary sanctions on an attorney or an unrepresented party that violates any one of these requirements. (Eichenbaum v. Alon (2003) 106 Cal App 4th 967, 976.) In addition, section 128.7 does not require a finding of subjective bad faith; instead it requires only that the Court find that the conduct be objectively unreasonable. (In re Marriage of Reese & Guy (1999) 73 Cal. App. 4th 1214, 1221.)

Under section 128.7, a court may impose sanctions if it concludes a pleading was filed for an improper purpose or was indisputably without merit, either legally or factually. (Bucur v. Ahmad (2016) 244 Cal.App.4th 175, 189–190.) A claim is factually frivolous if it is “not well grounded in fact” and is legally frivolous if it is “not warranted by existing law or a good faith argument for the extension, modification, or reversal of existing law.” (Ibid.) In either case, to obtain sanctions, the moving party must show the party's conduct in asserting the claim was objectively unreasonable. (Ibid.) A claim is objectively unreasonable if “any reasonable attorney would agree that [it] is totally and completely without merit.” (Ibid.) However, “section 128.7 sanctions should be ‘made with restraint’ [Citation], and are not mandatory even if a claim is frivolous.” (Peake v. Underwood (2014) 227 Cal.App.4th 428. at 448.)

After notice and a hearing, a court may impose sanctions on an attorney, law firm, or party that violates Code Civ. Proc., section 128.7(b), subject to the “safe harbor” conditions specified in Code Civ. Proc., section 128.7(c). (Id.; Optimal Markets, Inc. v. Salant (2013) 221 Cal.App.4th 912, 920.) A motion for sanctions under Code Civ. Proc., section 128.7 must be made separately from other motions and “shall describe the specific conduct alleged to violate subdivision (b).” (Code Civ. Proc., § 128.7(c)(1).) A party seeking sanctions under Code Civ. Proc., section 128.7, follows a two-step procedure. (Optimal, supra, 221 Cal.App.4th at p. 920.)

First, the moving party serves notice of the motion for sanctions on the offending party. (Code Civ. Proc., § 128.7(c)(1).) Service of the motion starts a safe harbor period during which the motion cannot be filed with the court. (Id.) If the challenged paper, claim, defense, contention, allegation or denial is not withdrawn or corrected within 21 days, the second step is to file or present the motion for sanctions to the court (i.e., presentment). (Code Civ. Proc., § 128.7(c)(2).)

“This permits a party to withdraw a questionable pleading without penalty, thus saving the court and the parties time and money litigating the pleading as well as the sanctions request. [Citations.]” (Optimal, supra, 221 Cal.App.4th at p. 920.) “While section 128.7 does allow for reimbursement of expenses, including attorney fees, its primary purpose is to deter filing abuses, not to compensate those affected by them. It requires the court to limit sanctions ‘to what is sufficient to deter repetition of [the sanctionable] conduct or comparable conduct by others similarly situated.’ [Citations.]” (Id. at pp. 920–921.)

Evidentiary Objections

Plaintiff’s objection to Defendant’s Evidence:

The following objections are OVERRULED: 1.

The following objections are SUSTAINED: 2. Defendant’s characterization of his relationship with Defendant Postmates in a declaration is not dispositive. Patterson v. Domino’s Pizza (2014) 60 Cal.4th 474, 510 [parties’ self-serving characterization of their relationship in a declaration is not dispositive.]

Discussion

Defendant moves for sanctions under CCP section 128.7 in the form of dismissing the case, and monetary sanctions, arguing that Plaintiff and his counsel filed the complaint for an improper purpose, and the complaint is without merit, both legally and factually.

Defendant has complied with the 21-day safe harbor provisions under CCP sections 128.5 and 128.7. (Kuck Decl., ¶ 3; Ex. B.)

However, the motion is denied. First, sanctions under CCP section 128.7 are not mandatory. “[S]ection 128.7 sanctions should be ‘made with restraint’ [Citation], and are not mandatory even if a claim is frivolous.” (Peake v. Underwood (2014) 227 Cal.App.4th 428. at 448.)

Second, the Court finds that the record does not reflect an adequate basis for a finding that the complaint is frivolous to warrant sanctions of any kind under Section 128.7, as the Court cannot say the complaint is indisputably without merit.

Defendant claims that Plaintiff fraudulently made a Postmates account under Hernandez’s name, but Hernandez states that he gave his social security and insurance information to Plaintiff. (Hernandez Decl., ¶ 9.) The declaration is silent as to whether Hernandez allowed Plaintiff to create the account under his name. The declaration simply states that Hernandez never asked anyone to create the account on his behalf, and Hernandez never created or intended to create an account to make or receive deliveries. (Id., ¶¶ 5-6.) Did Hernandez intend to create an account for someone else to make deliveries? While he did not ask to create it, did he allow it? Otherwise, why would he give his social security and insurance information to Plaintiff? This motion, which would dismiss the entire case, cannot be granted based on wordplay.

In any event, Plaintiff states that Hernandez offered Plaintiff to open an account under his name so Plaintiff could work. (Quijano Decl., ¶ 3.)

In addition, Defendant argues that the creation of a Postmates account under Hernandez's name was done by Plaintiff with the specific intent to deceive and defraud Postmates from knowledge of who would be accessing and using the Postmates platform to conduct deliveries. Assuming without deciding that the evidence that he created an account with authorization from Defendant Hernandez constitutes fraud, Defendant provides no law that states that if Plaintiff were to create an account under the name of another person that he cannot sue in these circumstances. Further, there could be exceptions to Defendant’s defenses that Plaintiff has not a chance to brief because no law has been provided. In sum, Defendant does not provide this Court with sufficient information to grant this motion.

Defendant may elect to file a motion for summary judgment instead and provide substantial evidentiary support and law to support its arguments.

Lastly, Plaintiff requests sanctions against Defendant under CCP section 128.7 in the opposition. However, a motion for sanctions under Code Civ. Proc., section 128.7 must be made separately from other motions and “shall describe the specific conduct alleged to violate subdivision (b).” (Code Civ. Proc., § 128.7(c)(1).) Thus, the request is denied.