Judge Monica Bachner, Case 19STCV42090 2023-03-28 Tentative Ruling

Department 71: Attorneys who elect to submit on these published tentative rulings, without making an appearance at the hearing, may so notify the Court by communicating this to the Department's staff at (213) 830-0771 before the set hearing time. See, e.g., CRC Rule 324(b). All parties are otherwise encouraged to appear by Court Call for all matters.

Defendants Robert K. Barth’s and Eastwind Financial, LLC’s motion to tax Plaintiffs Haderway PTC, LLC’s and BFSB Portfolio, LP’s costs is granted with regards to the depositions in the amount of $22,967.11 (allowing $33,471.59) and denied as to the Mechanics Bank subpoenas that are recoverable in this action.

Defendants Robert K. Barth (“Barth”) and Eastwind Financial, LLC (“Eastwind”) (collectively, “Defendants”) move to tax costs requested by Plaintiffs Haderway PTC, LLC (“Haderway”) and BFSB Portfolio, LP (“BFSB”) (collectively, “Plaintiffs”) on grounds that depositions taken in the Brighton case and subpoenas issued in the Brighton case are not recoverable in this action. (Motion Tax Costs, pgs. 9-11.)

This is a derivative action Plaintiffs prosecuted on behalf of JBR Alondra, LLC and Centerville Place 1203 Main, LLC, of which Plaintiffs are investors. Beginning on October 4, 2021, this Court presided over a nine-day bench trial. On May 26, 2022, this Court entered judgment in favor of Plaintiffs on the first and second causes of action for breach of fiduciary duty and misappropriation of opportunity with damages in the amount of $6,692,740, and punitive damages in the amount of $6,692,740, for total damages of $13,385,480, plus prejudgment interest, and stated that Plaintiffs may “seek attorney fees under the common-fund doctrine by post-judgment motion.” (Judgment.) On June 14, 2022, Plaintiffs filed a memorandum of costs seeking $138,686.73 in total costs. On January 3, 2023, this Court granted in part Defendants’ motion to tax costs in the reduced amount of $36,105.44, and continued Defendants’ motion for Plaintiffs to identify the portions of the depositions and Mechanics Bank subpoenas that are recoverable in this action. (1/3/23 Minute Order.) On March 16, 2023, Plaintiffs filed their supplemental brief. On March 20, 2023, Defendants filed their response to Plaintiffs’ supplemental brief. On March 22, 2023, Plaintiffs filed their reply to Defendants’ response.

Defendants move to tax $58,934.30 in deposition costs and argue twelve of the total nineteen witnesses had their depositions noticed and taken in Stanley Black v. Robert K. Barth, et al., Case No. 19STCV41943 (“Brighton Case”), not the instant action. (See Decl. of Klieger ¶¶2-13 & Exhs. 1-12.) Defendants argue costs incurred in connection with depositions in a separate action are not recoverable. (In re Bauer’s Estate (1943) 59 Cal.App.2d 161, 163.) Defendants argue two witnesses—Robert K. Barth and Bernhard Punzet—were separately deposed in the Brighton Case and the instant action, but because Plaintiffs lump those costs together, Defendants are unable to determine what portion of the costs were incurred in the instant action. (Decl. of Klieger ¶¶14-15 & Exhs. 13-14; Memorandum of Costs, Attach. 4(e).) Plaintiffs argue the parties agreed that depositions taken under this case and the Brighton case would be “treated as taken in both cases.” (Decl. of Rothschild ¶3, Exh. 1.) However, Defendants presented evidence that the parties never entered into that stipulation, and they instead proceeded on the understanding that the depositions could be used for both cases—not that they were actually taken in both cases. (Supp.-Decl. of Klieger ¶2.)

C.C.P. §1033.5(c)(2) allows for costs reasonably necessary to the conduct of the litigation, and C.C.P. §1033.5(b) is silent as to the apportionment of deposition costs among multiple actions. Plaintiffs concede the $3,553.30 charge for the transcription of Jack Black’s deposition was in error. (Decl. of Rothschild ¶7.) Plaintiffs also withdraw their request for $992.95 for Nikki Vallot’s deposition, which was included inadvertently. (Opposition Tax Costs, pg. 5 n.2.) Regarding the remaining depositions, the Court could not determine what portion of the remaining depositions are allocated to the instant case and ordered Plaintiffs to provide supplemental briefing.

The parties concur in $5,498.90 in depositions costs, consisting of expert witness depositions and one other witness: Shelly Cuff ($517.60), Robert Minsky ($390.65), Constantjin Panis ($2,917.40), and Eric Sussman ($1,673.25). (Plaintiffs’ Supp. Brief Tax Costs, pg. 3.) The Court determines these costs are allowable.

Plaintiffs argue $17,794.40 in depositions costs were noticed under the instant case caption and Plaintiffs are entitled to 100% of costs because they were taken in and necessary for the instant case because they primarily relate to issues in the instant case. (Plaintiffs’ Supp. Brief Tax Costs, pg. 4.) The Court makes the following rulings regarding the specific costs:

Plaintiffs argue that to the extent they touched on Brighton’s operations and history and concerned Stanley Black’s medical condition and relationship with Barth, they were reasonably necessary for background and context, because Barth perpetrated the defalcation at issue herein by use of Brighton’s employees, professional advisors and other resources, and because Barth asserted many of the same defenses, including standing, competency, and that Black consented to his thefts, in both cases. (Plaintiffs’ Supp. Brief Tax Costs, pg. 4.)

1. Deposition of Robert K. Barth on 6/26/21, cancelled by Barth (Costs: $325.00), as no deposition was noticed for that day, $325 is taxed;

2. Deposition of Barth on 8/17/21 (Transcript: $4,675.25, and Videographer: $1,510.00, for a total of $6,185.25), these costs are allowable;

3. Deposition of Bernhard Punzet on 6/10/21, noticed by Barth (Transcript: $2,078.25), the Court will allow $1,039.13, $1,039.12 is taxed;

4. Deposition of Punzet on 9/29/21, noticed by Barth (Transcript: $675.00), this cost is withdrawn and thus $675 is taxed;

5. Deposition of Punzet as PMK for Plaintiff BFSB on 10/7/21, noticed by Barth (Transcript: $951.95), these costs are allowable;

6. Deposition of Michelle Rojas on 8/20/21, noticed by Barth (Transcript: $1,518.75), these costs are allowable;

7. Deposition of Rojas on 9/8/21, noticed by Barth (Transcript:$1,330.60), these costs are allowable;

8. Deposition of Jill Black on 8/23/21, noticed by Barth (Transcript: $1,455.90), these costs are allowable;

9. Deposition of Darren Weinstock on 9/13/21 (Transcript: $1,306.60). (Plaintiffs’ Supp. Brief Tax Costs, pg. 4), this deposition was noticed in the Brighton case, $1,303.60 is taxed.

Plaintiffs argue $11,806.50 in fixed deposition costs were noticed under the Brighton case caption. Plaintiffs argue these awardable costs include 100% of fixed costs that were incurred on a deposition-by-deposition basis, without regard to transcript length or duration. (Plaintiffs’ Supp. Brief Tax Costs, pgs. 4-5.) Plaintiffs argue $16,145.77 in costs allocated between cases for charged based on the length of the depositions and duration of the videos are allocated to exclude time spent, if any, on purely Brighton issues, and Plaintiffs made the allocation based on a review of the testimony, the extent to which the exhibits relate to issues in the instant case, and the number of times the index reflects that the words “Greenway,” “house,” “Alondra” and “Centerville” appear. (Plaintiffs’ Supp. Brief Tax Costs, pg. 5, Exhs. 1-11.) Plaintiffs argue much of the testimony that related to the Brighton case concerned its background and operations, which were relevant to both cases, and to Stanley Black’s health, which also was relevant to both cases. (Plaintiffs’ Supp. Brief Tax Costs, pg. 5, Exhs. 1-11.) Defendants concur as to certain items, and argues that the Court should make a different allocation as to other items.

1. Deposition of Barth on 6/24/21, cancelled by Barth (Costs: $395.00)- $395 is taxed;

2. Deposition of Barth on 9/15/21 (Fixed: $1,175.00, Allocable: $1,189.15 (50% of costs) for a total of $2,364.15),[1] the Court will allow 50% of the total costs or $1,776.50, $587.65 is taxed;

3. Deposition of Eric Finkelstein on 5/18/21, read at trial 10/6/21 Tr. Trans. pgs. 348-349 (Fixed: $1,803.50, Allocable: $3,433.95 (100% of costs) for a total of $5,237.45), the Court will allow 50% of the total costs, or $2,618.73, $2,618.72 is taxed;

4. Deposition of Nicole Frank on 5/11/21, read at trial 10/13/21 Tr. Trans. pgs. 677-678, 683-685 (Fixed: $1,080.00, Allocable: $1,680.95 (100% of costs) for a total of $2,760.95), the Court will allow 60% of the total costs, or $1,656.57, $1104.38 is taxed;

5. Deposition of Herb Klein on 4/6/21, read at trial 10/14/21 Tr. Trans. pgs. 836-837 (Fixed: $1,825.00, Allocable: $1,610.80 (50% of costs), the Court will allow 20 % of the total costs or $1,009.32, $2,426.48 is taxed;

6. Deposition of Richard Lucy on 5/25/21 read at trial 10/12/21 Tr. Trans. pgs. 599-617 (Fixed: $1,492.00, Allocable: $449.72 (50% of costs) for a total of $1,941.72), the Court will allow 5% of the total costs, or $119.57, $1822.15 is taxed;

7. Deposition of Scott Murphy on 5/20/21 read at trial 10/5/21 Tr. Trans. pgs. 268, 282-286, 304-308 (Fixed: $1,729.50, Allocable: $2,497.69 (75% of costs) for a total of $4,227.19), the Court will allow 25 % of the costs, or $1,264.94, $2,962.25 is taxed;

8. Deposition of Kathy Stimson on 3/31/21 read at trial 10/14/21 Tr. Trans. pg. 930 (Fixed: $1,778.50, Allocable: $709.96 (25% of costs) for a total of $2,488.46), the Court will allow 25% of the costs or $1,154.59, $1,333.87 is taxed;

9. Deposition of Zach Zalben on 3/4/21 read at trial 10/12/21 Tr. Trans. pgs. 484-485 (Fixed: $24.00, Allocable: $578.45 (50% of costs) for a total of $702.45), Exh. 8, the Court will allow 25 % of the costs or $344.23, $357.22 is taxed;

10. Deposition of Zalben on 8/24/21 (Fixed: $35.00, Allocable: $1,128.75 (100% of costs) for a total of $1,163.75), Exh. 9; Deposition of Zalben/Punzet on 9/29/21 (Allocable: $2,177.25 (100% of costs), the Court will allow 50% of the costs or $581.88, $581.87 is taxed;

11. Depositions of Zalben and Jack Black on 8/29/21 (Fixed: $469.00, Allocable: $689.10 (100% of costs) for a total of $1,163.75), the Court will allow 25 % of the total costs or $289.53, $888.55 is taxed.

Defendants’ motion to tax fees for service of process was granted in the reduced amount of $3,489.80. The Court directed Plaintiffs to submit supplemental briefing with regards to service of process fees related to subpoenas to Mechanics Bank, which was subpoenaed in the Brighton Case and the instant case, and Plaintiffs made no attempt to distinguish the fee breakdown between the two cases. (Motion Tax Costs, pg. 11.)

Plaintiffs argue the Mechanics Bank subpoenas issued under the Brighton case caption sought only documents related to the instant case, and therefore they were incurred for the purpose of the instant case and the associated service costs are awardable. (Plaintiffs’ Supp. Brief Tax Costs, pgs. 10-11; Decl. of Rothschild ¶13, Exh. 12.) The Court determines these $1,610.14 in costs are allowable.

Defendants’ motion to tax costs is granted in part with regards to the depositions and denied as to the Mechanics Bank subpoenas.

[1] Plaintiff designated certain costs as fixed and requested 100% of the costs, and allocated the transcripts. The Court allows a certain percentage of the total costs for each deposition as noted.