Judge Michael P. Linfield, Case BC697147 2022-08-23 Tentative Ruling

Judge: Michael P. Linfield, Case: BC697147, Date: 2022-08-23 Tentative Ruling

Case Number: BC697147 Hearing Date: August 23, 2022 Dept: 34

SUBJECT: Motion for Reconsideration

Moving Party: Plaintiff Caroline S. Lee (“Lee”)

Resp. Party: Intervenor Bow Tie Realty & Investment, Inc. (“Bowtie”) and United Escrow Co. (“United”) (collectively “Defendants”)

SUBJECT: Motion for Sanctions Pursuant to CCP § 128.7

Moving Party: Intervenor Bow Tie Realty & Investment, Inc. (“Bowtie”) and United Escrow Co. (“United”) (collectively “Defendants”)

Resp. Party: None

Plaintiff Caroline S. Lee’s Motion for Reconsideration is DENIED.

Intervenor Bow Tie Realty & Investment, Inc., and United Escrow Co.’s Motion for Sanctions Pursuant to CCP § 128.7 is GRANTED ini the amount of $3,810.00.

I. BACKGROUND

On March 7, 2018, Plaintiff Caroline S. Lee filed a complaint against Defendants Jong Han Lee; Bow Tie Realty and Investment. Inc.; Tracy Ko; United Escrow Co. to allege the following causes of action:

1. Breach of Contract and Resulting Trust

2. General Negligence

3. Intentional Tort: Breach of Fiduciary Duty

4. Intentional Tort: Breach of Fiduciary Duty

5. Breach of Contract

6. General Negligence

7. Intentional Tort: Breach of Fiduciary Duty

8. Intentional Tort: Breach of Fiduciary Duty

On March 21, 2022, Judge David Sotelo issued an order relating cases BC697147 and 22STCV05772. (Minute Order, filed April 4, 2022, p. 1.)

On April 25, 2022, Defendant United Escrow Co. and Intervenor Bow Tie Realty & Investment, Inc. separately moved for attorney’s fees incurred on appeal No. B308739. United requests $24,075.00 in attorney’s fees; Bowtie seeks $65,737.50 in attorney’s fees.

On May 24, 2022, the Court granted Defendant United Escrow Co.’s Motion for Attorney’s Fees on Appeal in the amount of $24,570.65. The Court also granted Intervenor Bow Tie Realty & Investment, Inc.’s Motion for Attorney’s Fees on Appeal in the amount of $66,598.15.

On June 7, 2022, Plaintiff Caroline S. Lee moved the Court for reconsideration of its two May 24, 2022 rulings on United Escrow and Bow Tie Realty and Investment, Inc. (Reconsideration Motion, p. 1:27—2:3.)

On July 29, 2022, Intervenor Bow Tie Realty & Investment, Inc. (“Bowtie”) and United Escrow Co. (“United”) moved the Court pursuant to Code of Civil Procedure § 128.7 for sanctions against Jack Karpeles, counsel for Plaintiff, Caroline Lee (“Plaintiff”) in the amount of $7,562. (Sanctions Motion, p. 1:22-25.)

On August 1, 2022, Bowtie and United opposed Lee’s motion for reconsideration.

II. ANALYSIS

A. Legal Standard

1. Motion for Reconsideration

Pursuant to Code of Civil Procedure Section 1008(a):

“When an application for an order has been made to a judge, or to a court, and refused in whole or in part, or granted, or granted conditionally, or on terms, any party affected by the order may, within 10 days after service upon the party of written notice of entry of the order and based upon new or different facts, circumstances, or law, make application to the same judge or court that made the order, to reconsider the matter and modify, amend, or revoke the prior order. The party making the application shall state by affidavit what application was made before, when and to what judge, what order or decisions were made, and what new or different facts, circumstances, or law are claimed to be shown.” (CCP §1008(a).)

As stated by the court in Gilberd v. AC Transit (1995) 32 Cal.App.4th 1494, 1499, a court acts in excess of jurisdiction when it grants a motion to reconsider that is not based upon “new or different facts, circumstances or law.” There is a strict requirement of diligence, meaning the moving party must present a satisfactory explanation for failing to provide the evidence, different facts, or law earlier. (Garcia v. Hejmadi (1997) 58 Cal.App.4th 674, 690.) A motion for reconsideration was properly denied where based on evidence that could have been presented in connection with the original motion. (Morris v. AGFA Corp. (2006) 144 Cal.App.4th 1452, 1460; Hennigan v. White (2011) 199 Cal.App.4th 395, 406.)

2. Sanctions Pursuant to CCP § 128.7

“(b) By presenting to the court, whether by signing, filing, submitting, or later advocating, a pleading, petition, written notice of motion, or other similar paper, an attorney or unrepresented party is certifying that to the best of the person's knowledge, information, and belief, formed after an inquiry reasonable under the circumstances, all of the following conditions are met: …

(3) The allegations and other factual contentions have evidentiary support or, if specifically so identified, are likely to have evidentiary support after a reasonable opportunity for further investigation or discovery. ….

(c) If, after notice and a reasonable opportunity to respond, the court determines that subdivision (b) has been violated, the court may, subject to the conditions stated below, impose an appropriate sanction upon the attorneys, law firms, or parties that have violated subdivision (b) or are responsible for the violation. In determining what sanctions, if any, should be ordered, the court shall consider whether a party seeking sanctions has exercised due diligence.” (CCP § 128.7.)

B. Discussion

1. Motion for Reconsideration

Lee’s three-page Motion for Reconsideration offers no new facts or law upon which to grant reconsideration. In fact, the Motion contains no facts at all. There is no declaration attached to the Motion; it is simply argument of counsel. (See e.g., Fuller v. Tucker (2000) 84 Cal.App.4th 1163, 1173 [“Argument of counsel is not evidence”; Ponte v. County of Calaveras (2017) 14 Cal.App.5th 551, 556 [“the arguments of counsel in a motion are not a substitute for evidence, such as a statutorily required affidavit.”)

(The Court notes that this is not the first time that Plaintiff’s counsel Karpeles has submitted a brief devoid of facts. As the Court stated three months ago, “The Court does not understand how counsel [Karpeles] would devote only two pages – with no accompanying declarations or evidence – to trying to defeat motions requesting over $90,000 in attorney's fees.” (See Minute Order, May 24, 2022.)

Lee’s argument that exhibits in a related case provide evidence to refute the analysis outlined in the Court’s Minute Order of May 24, 2022 is unpersuasive. Counsel has made this argument at least twice previously; each time it has been rejected by this Court. The argument made in motion simply rehashes old contentions about an alleged phone call attributed to Mr. Biggins and discusses an email with little or no relevance to the attorney’s fees motions decided on May 24. (Motion for Reconsideration, p. 2:16—3:19.)

Without new facts or law, the Court may not grant reconsideration.

2. Sanctions Pursuant to CCP § 128.7

Defendants filed a Motion for Sanctions arguing that Jack Karpeles, counsel for Plaintiff Caroline S. Lee, committed the following violations of CCP § 128.7:

· “Violation of C.C.P. § 128.7(b)(1) because the motion for reconsideration scheduled for hearing on 8-22-22 (Res. 360704646962) is presented for an improper purpose, to wit, to harass Bowtie & United and to cause unnecessary delay and to needlessly increase in the cost of litigation.

· Violation of C.C.P. § 128.7(b)(2) because the 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.

· Violation of C.C.P. § 128.7(b)(3) because the allegations and other factual contentions asserted by Jack Karpeles have NO evidentiary support and are NOT likely to have evidentiary support after a reasonable opportunity for further investigation or discovery.” (Sanctions Motion, p. 2:1-12.)

Defendants argue that Lee’s counsel “knowingly presented intentionally misleading and false arguments and facts in order to advance their scheme to delay, annoy, harass and cause unnecessary expense.” (Sanctions Motion, p. 7:13-15.) The Court finds no evidence to support that contention.

It is clear that the motion for reconsideration lacks evidentiary support. Thus, monetary sanctions are warranted for violation of CCP s 128.7(b)(3).

However, CCP § 128.7 has a safe-harbor provision. According to the statute, the motion shall not “be filed with or presented to the court unless, within 21 days after service of the motion, or any other period as the court may prescribe, the challenged paper, claim, defense, contention, allegation, or denial is not withdrawn or appropriately corrected.” (CCP §128.7(c)(1).) Defense counsel alleges in his motion that “Movants gave counsel the opportunity to withdraw the motion. Thus, this Motion will have been filed after the required 21 days safe harbor period. . . .” (Motion for Sanctions, p. 7:21-24.) Attached to defense counsel’s declaration is the proof of service, indicating that the motion was served on Plaintiff on July 5, 2022, more than required by the 21-day safe-harbor provision. (See Motion for Sanctions and Biggins Declaration, filed 7/29/22.)

Defense counsel is requesting $7,562.00 in sanctions for 10 hours of work at $750/hour plus filing fee. According to counsel, “I spent approximately 4 hours drafting this motion and the opposition to the motion for reconsideration, anticipate spending another 4 hours for the reply and 2 hours for the hearing.” (Biggins Declaration, ¶ 4.) The Court finds this unreasonably high. The Court awards sanctions of $3,810.00, consisting of five hours of attorney’s time at $750/hour, plus a filing fee of $60.00.

III. CONCLUSION

Plaintiff Caroline S. Lee’s Motion for Reconsideration is DENIED.

Intervenor Bow Tie Realty & Investment, Inc., and United Escrow Co.’s Motion for Sanctions Pursuant to CCP § 128.7 is GRANTED ini the amount of $3,810.00.