Judge: Mark H. Epstein, Case: 23SMCV03731, Date: 2025-04-04 Tentative Ruling

Case Number: 23SMCV03731    Hearing Date: April 4, 2025    Dept: I

This is a motion to compel further responses, specifically two RFP’s.  The court will consider the untimely opposition, but if defendant believes that its reply (which the court also considered) was inadequate due to the late filing, the court will consider allowing a supplemental reply and continuing the hearing.  The court doubts that will be productive, though. 

In moving to compel further production of documents, the moving party must make an initial showing that there is a justification for the discovery.  The court believes such a justification has been made.  Nor does plaintiff really challenge that; plaintiff’s argument is based more on privilege than the general scope of discovery.  The issue surrounding the motion is Brandt fees.  Plaintiff sues the carrier for improper denial of coverage.  The theory of such a case is that the carrier’s improper refusal caused the plaintiff damages, one aspect of which is the need to retain counsel to get that which the carrier should have provided.  More concretely, if the carrier refuses coverage and will not provide counsel, thereby forcing the insured must hire counsel to get the benefits of the defense to which the insured was entitled, that is damage.  But one must be careful.  What constitutes damages are the fees that the insured spent in the underlying case that plaintiff would not have spent had the carrier acted properly.  Those are straight out of pocket damages, and they must be pled and proved at trial; they cannot be recovered by post trial motion, as could be fees where fees are a recoverable cost under a contractual fee provision, for example.  On the other hand, fees spent to force the carrier to honor the contract are not damages.  Accordingly, it is often the case that an attorney for the insured is doing double-duty.  On the one hand, the attorney is providing the defense that the carrier should have provided—defending the underlying case.  On the other hand, the attorney might be pursuing a declaration that there is a duty to defend or otherwise aiding in the arguments against the carrier.  The former fees are recoverable under the seminal case Brandt v. Superior Court (1985) 37 Cal.3d 813.  And, because the plaintiff is seeking those fees as an element of the case, there is a waiver of the attorney/client privilege with regard to the amounts thereof.  However, the waiver only goes that far.  There is no waiver as it pertains to fees not recoverable under Brandt.  This can lead to no end of problems.  The matter was discussed in Byers v. Superior Court (2024) 101 Cal.App.5th 1003.  In that recent case, the Court of Appeal held that an order compelling the production of documents in the teeth of an assertion of privilege was proper so long as the order was tailored to the waiver and did not require that documents that were privileged be turned over.  That is the case here.  Defendant has the right to bills, invoices, receipts, or other documents that show fees charged and fees paid that fall within Brandt.  True, it is often better if the parties agree that Brandt fees will be determined later, for example by post trial motion.  That procedure allows for the issue to be put down the road and resolved if the case does not settle.  But a stipulation is never required (by definition).  Defendant need not have agreed to so stipulate, and until and unless there was such an agreement, defendant had the right to discovery on the fees. 

Plaintiff can avoid this in the event that Brandt fees are not sought, but the court does not understand this to be the case.  And as such, plaintiff has waived the privilege in that limited way.  The motion will therefore be GRANTED.  Documents responsive to the request will be produced, along with a verified supplemental response without objection other than privilege as it pertains to non-Brandt fees.  The production and response are due in 15 calendar days.  However, plaintiff may redact from the production any documents that pertain to fees that are not being sought under Brandt, and, at least for now, may also redact substantive privileged advice.  The redactions will either be obvious from the production or recorded on a log.  Surprisingly, plaintiff does not discuss Byers in its opposition, which the court finds to be a dispositive case on point.  Plaintiff really needed to do that. 

The court disagrees with plaintiff that a summary will suffice.  Defendant is entitled to see the bills themselves.  Only through that review can defendant determine whether it wants to challenge the reasonableness of the Brandt fees being sought.  Nor will the court conduct an in camera inspection.  First, the court cannot order such an inspection with regard to documents over which the privilege is asserted.  Federal courts can do that, but not state courts.  To the extent plaintiff is inviting that process, the court politely declines the invitation.  To the extent one is determining if work product is being redacted, the court has the power to order such a review, but such a review is premature at this point.

The court will GRANT the sanctions motion.  Brandt is really dispositive here, and the failure even to discuss Byers suggests that there is really no comeback to it.  Nor does the court believe that the failure to agree to an IDC is dispositive of the fee question.  This was a question of privilege.  Other than to have the court explain the law to plaintiff, no purpose would have been served by an IDC.  Finally, the fees sought are reasonable.  The fees are $5235, which the court believes is appropriate.  The fees are assessed against plaintiff, but not counsel, and are payable within 30 days to defense counsel.