Judge: Mark H. Epstein, Case: 21SMCV01029, Date: 2023-04-20 Tentative Ruling

Case Number: 21SMCV01029    Hearing Date: April 20, 2023    Dept: R

The motions to compel are GRANTED IN PART.

INTERGROUP.  SI 11 and SI 14 have been modified by agreement.  The court tends to agree with plaintiff as to SI 11 seeks to know with whom Doyle spoke on InterGroup’s behalf.  Thus, the question is properly directed to InterGroup.  The court disagrees with the objection (not originally made) that the response would call for an improper compilation.    SI 14 asks for information concerning cash transfers from InterGroup to Doyle during a four month period.  Defendant claims that the SI is overbroad but the court disagrees.  Whether InterGoup is sending money to Doyle is pertinent to the case.  Defendant contends that there is no allegation that Doyle stole money or obtained it wrongfully.  But plaintiff need not allege or so prove.  The point is that if money is headed Doyle’s way, it could support the theory that the investment was a fraud.  It also is pertinent to the statute of limitations issue and intent.

DIRECT ENERGY.  At issue is SI 12.  The reasoning is essentially the same as for InterGroup SI 14.  The same result is reached.

CYBERLINE.  SI 10 seeks identification information of investors.  Defendant asserts third party privacy.  However, the question was posed because defendant asserted in response to SI 4-7 that it did not have the information in its possession, custody, or control to answer the questions there posed.  This is therefore needed to get the information that Cyberline could not provide.  Plaintiff’s theory is that the Cyberline’s stock trading technology was a hoax so it wants to know about the number and volume of trades made at about the seme time.  The investors might have the information Cyberline does not.  The only way to know is to get their identities.  The court does not view this as a terribly efficient way to get the information, but given that plaintiff tried getting it from Cyberline directly (without success), the court is disinclined to second-guess the strategy.

PRIVILEGE LOG.  The motion for a supplemental privilege log is DENIED IN PART.  This is defendants’ motion to get a better privilege log.  The court has reviewed the log, and it is not perfect.  The problem is that there is no brief description of the document and its comments or subject matter “sufficient to determine whether the privilege applies.”  (Catalina Island Yacht Club v. Superior Court (2015) 242 Cal.App.4th 1116.)  In addition, some documents were given to third parties with no explanation as to how that might affect the waiver.

The reason that the motion is being denied in part nonetheless—and the court can be talked out of it—is that the court is considering ruling that should the asserted privilege be challenged, plaintiff will be limited to the log for support; other than a declaration authenticating the log, no additional evidence to establish privilege will be allowed.  Recalling that it will be plaintiff’s burden to make a prima facie showing of privilege, if plaintiff believes that it has done enough, so be it.  But that might well mean that documents that do turn out to be privileged will be turned over.

That said, the motion is GRANTED to the extent that the only reason a document is not being produced is because it is non-responsive.  That is, if there is no privilege over the document being asserted, the document will be produced whether it is responsive or not.  There is enough doubt given that it was originally categorized differently that the court will so order.  And, because there is no privilege, there is no harm.

The request for sanctions regarding the log is GRANTED but only for fees incurred up to the time that the motion was filed.  After that point, the court believes there is substantial justification for plaintiff’s position.  Prior to that, the iterations were not sufficient.  Plaintiff contends that there is no statutory basis to impose sanctions.  The court disagrees.  The statutes governing motions to compel generally authorize sanctions, and they apply here.

On the more general issue of date range, the court tends to side with plaintiff.  The longer date range is important for statute of limitations issues and also because things that happen even outside of what defendants contend is relevant can color the way one views events that occurred at what happened during the relevant time.  The court has already discussed the issues concerning money going to Doyle from the entities—the court agrees with plaintiff there as well.

The court believes that this order resolves some of the other matters on the calendar in the future.  The court is inclined to hold those matters in abeyance while the parties discuss whether the issues can be resolved in light of this ruling.

In the future, the court notes that for “big picture” types of issues, an IDC may be a far more efficient way to try to get at a resolution.