Judge Ralph C. Hofer, Case Number: BC691050, Date: 2024-12-20 Tentative Ruling

On January 22, 2018, plaintiff Jason Steger filed this action, alleging that in October of 2016, plaintiff was admitted to defendant CSJ Providence St. Joseph Medical Center with abdominal pain, and that defendants, various medical providers, negligently performed a colonoscopy procedure on plaintiff which perforated his colon in multiple areas. Plaintiff alleges that after the procedure, his pain worsened and he went into septic shock. Plaintiff alleges that he ultimately underwent a total colectomy with ileostomy and other procedures, and his entire colon was removed.

The operative complaint alleges that defendant Olympus America sells, markets and services medical products, including endoscopes such as the specific endoscopes involved in the subject incident, that the endoscopes were defective, that the Olympus defendants performed inadequate evaluation and testing of the scopes, including failing to properly determine the scope’s reprocessing protocol adequately disinfected the device for safe subsequent use in multiple endoscopic patients, and fraudulently marketed the scopes, as a result of which plaintiff suffered injuries.

On December 1, 2023, the court heard a motion concerning augmenting plaintiff’s expert witness list, and two motions to dismiss the action for failure to bring the matter to trial, one filed by defendant Olympus, and one filed by defendants Dr. Kasher and Dr. Kao. The court required supplemental briefing. Supplemental briefs were filed, served, and considered by the court and at the hearing on December 22, 2023, the court denied a motion by plaintiff for reconsideration of the court’s September 15, 2023 orders in connection with the deposition of plaintiff’s expert Dr. Gazi and monetary sanctions, and granted the two motions to dismiss under CCP section 583.360 for failure to have brought the case to trial within five years, as extended by statute by six months. Plaintiff’s motion to augment and substitute experts was deemed moot in light of the granting of the motions to dismiss.

On January 12, 2024, the court signed and filed a Judgment of Dismissal as to Defendant Olympus America, Inc., ordering, adjudging and decreeing that plaintiff’s operative Second Amended Complaint was dismissed pursuant to CCP sections 583.310 as to defendant Olympus America, Inc. The judgment further states that defendant “shall recover its costs of suit from Plaintiff Jason Steger in accordance with a bill of costs to be filed after entry of this judgment.” A similar Judgment of Dismissal as to Defendants John A. Kasher, M.D., and James Kao, M.D. was filed and signed the same date.

Also on January 12, 2024, the court signed and filed an Order on Monetary Sanctions Award from September 15, 2023 Hearing in Favor of Defendant Olympus America, Inc., ordering plaintiff Jason Steger, plaintiff’s counsel of record Blake J. Lindemann and Lindemann Law Firm, APC to pay the monetary sanctions in the amount of $6,672.90, plus interest, jointly and severally, to defendant Olympus America, Inc. within thirty days of notice of entry of the order. A similar Order on Monetary Sanctions Award from September 15, 2023 Hearing in Favor of John A. Kasher, M.D., and James Kao, M.D. was filed and signed the same date, ordering the payment of monetary sanctions in favor of defendants John A. Kasher, M.D. and James Kao, M.D. in the sum of $3,351.93, payable within thirty days of notice of the entry of the order.

Also on January 12, 2024, the court entered an Order on Monetary Sanctions Award from August 6, 2021 Hearing in Favor of Defendant Olympus America Inc., summarizing an August 6, 2021 minute order which awarded sanctions in connection with four discovery motions, three for responses to written discovery, and one to deem requests for admissions deemed admitted, which motions had been rendered moot by the service of belated responses prior to the hearing. The court awarded monetary sanctions in the total amount of $2,825.00 in favor of defendant Olympus America, Inc. and against plaintiff Jason Steger. The order provides, “Plaintiff Jason Steger is ordered to pay the monetary sanctions to Defendant Olympus America Inc. within thirty (30) days of notice of entry of this order.”

“files his notice of appeals to the Court of Appeal of the State of California, Second Appellate District, from the Notice of Ruling Dismissing this Case pursuant to the Five-Year Rule, dated December 27, 2023, the subsequent Judgment signed on this case on January 12, 2024, and all interim adverse rulings and findings previously issued in the Case through and including January 12, 2024, and any adverse rulings in the case made post-judgment.”

“from the Notice of Ruling Dismissing this Case pursuant to the Five-Year Rule, dated December 27, 2023, any subsequently signed Judgment, and all interim adverse rulings and findings previously issued in the Case through and including January 12, 2024, and any adverse rulings in the case made pre or post-judgment.”

On May 3, 2024, the court heard a motion to by plaintiff to clarify stay or to clarify that not paying discovery sanctions will not constitute a willful act of disobedience, seeking to stay the enforcement of the orders imposing monetary sanctions in this matter pending appeal, as well as a motion by plaintiff to strike, tax or disallow costs sought by defendant Olympus and defendants James Kasher and John Kao in their memoranda of costs.

The motion to clarify stay was denied, the court noting that to the extent the motion sought clarification of the court’s sanctions orders, judgments of those orders had been entered as final judgments on January 12, 2024, so that the court was without power to reconsider or change those judgments. [Minute Order 5/3/2024, pp. 11, 12].

The motion to strike and tax with respect to the memoranda of costs filed by the defendants was granted in part, the court awarding costs to defendants Dr. Kasher and Dr. Kao in the sum of $20,120.15, and to defendant Olympus in the sum of $1,379.64.

Plaintiff filed a motion for reconsideration of the motion to clarify the stay, and defendants Olympus and defendants Dr. Kasher and Dr. Kao filed motions for reconsideration of the motions to strike and tax costs, which were heard on July 5, 2024, and were denied.

On September 13, 2024, plaintiff filed a Notice of Deposit in Lieu of Bond, stating that the principals to be protected by the deposit to stay enforcement pending appeal are Lindemann Law, APC, and that plaintiff’s counsel deposits the sum of $10,009.35 in lieu of bond paid directly by Lindemann Law, APC (firm) in connection with the sanctions order of September 15, 2023 against firm and in favor of Olympus in the amount of $6,672.90, and the sanctions order of September 15, 2023 against firm and in favor of John A. Kasher, M.D. and James Kao, M.D. in the amount of $3,351.93. The notice indicates the deposit is made pursuant to CCP section 995.710. There is no proof of service filed showing that the notice was served.

On October 3, 2024, defendant Olympus filed a notice that it had filed a motion to dismiss plaintiff’s appeal. The motion argues that the portion of the appeal filed on March 6, 2024, the second appeal, which defendant argues is identical to the first appeal filed on February 13, 2024, is barred because the February 13, 2024 appeal has now been dismissed, and no second appeal from the same judgment can be maintained.

“Both motions are conditionally granted and Verified Responses are due in 10 days unless plaintiff's counsel posts a code compliant bond for both plaintiff's counsel and his law firm within 30 days. If no bond is posted both the Interrogatories and the Production of Documents become due 10 days thereafter.”

On November 4, 2024, plaintiff filed an ex parte application to determine bond/cash deposit posted is sufficient for protective order, for return of additional bond posted based on waiver, and for sanctions. On November 4, 2024, plaintiff also filed a notice of continued hearing on the application, continuing it to November 12, 2024. The court file shows the application was taken off calendar on November 5, 2024, when no one appeared for the ex parte application hearing.

Also on November 4, 2024, plaintiff filed a motion for reconsideration of the court’s order of October 22, 2024, evidently the order conditionally granting the motions to compel. That same date defendant Olympus America Inc. filed a motion objecting to judgment debtor Lindemann Law, APC’s Bond.

The file also shows that on November 14, 2024, the court of appeal filed with this court an order showing that appellant’s motion to vacate the order of dismissal of appeal was granted, and the order of dismissal filed November 4, 2024 was vacated and the appeal filed March 6, 2024 was reinstated.

On November 18, 2024, the ex parte application was heard by the court. The hearing on the ex parte application to determine bond/cash deposit posted is sufficient was continued to December 20, 2024, the date of the hearing on the motion objecting to the bond. The court ordered “a Stay of Enforcement of the 10/18/2024 Order as to the document production and sanctions, with the stay to be in effect until December 20, 2024.” The hearing on the other outstanding motions was set for January 24, 2025. Plaintiff’s counsel was ordered to submit two proposed orders for the December 20, 2024 hearing date.

Plaintiff seeks an order that plaintiff’s filing of an additional undertaking in the additional amount of $5,012.42 on October 23, 2024 is sufficient so that the four motions scheduled for judgment debtor discovery must be withdrawn or a protective order issued.

Plaintiff argues that plaintiff’s counsel originally served a notice of posting a deposit in the amount of $10,009.35, which was served by email on September 27, 2024, and no timely noticed motion or objection was filed within ten days, so that any objection to the bond was waived, and the original amount should be deemed sufficient.

As the court previously noted, the original Notice of Deposit in Lieu of Bond makes no mention of any bonding of the sanction order as entered against Blake J. Lindemann, or plaintiff Jason Steger, but expressly states that “[t]he principals protected by the deposit to stay enforcement pending appeal, are Lindemann Law, APC (“Firm”),” and that the sanction orders subject to the deposit are those made “against Firm,” that, “[t]he funds are being paid directly by Lindemann Law, APC, and not the client or anybody else,” and that the deposit “may not be used for any other purpose other than to obtain a stay of the enforcement of” the sanctions order, “return the funds to Lindemann Law, APC” if the appeal is successful, “or to enforce the liability of the principals…,” and that the “Firm agrees and authorizes” the court “to apply the deposit to enforce the liability of the principal on the deposit solely limited to, and in connection with, the appeal of the sanction order and order denying the motion to reconsider.” [Notice of Deposit, paras. 2, 4, 5, 7, 8].

The liability of Blake Lindemann individually has not been subject to a deposit in lieu of bond at all, and neither has the liability of plaintiff Jason Steger. The enforcement of the orders against those judgment debtors is accordingly not subject to stay of execution, and the request for an order that the bond be deemed sufficient must be denied as to those two judgment debtors.

The Court had previously observed that the sum of the original deposit made was evidently calculated by adding together the sums of the sanctions awards made against Lindemann, and/or the Firm, and depositing approximately that total sum. (No deposit has ever been made to cover the sanctions awarded only against plaintiff Steger). The deposit amount mentioned in the Notice is $10,009.35. [Notice of Deposit, para. 6]. The amount of the sanctions awards are $6,672.90 and $3,341.93, which combined would total $10,024.83, more than the original deposit.

“(a) Except as provided in subdivision (e) or to the extent the statute providing for a bond precludes a deposit in lieu of bond or limits the form of deposit, the principal may, without prior court approval, instead of giving a bond, deposit with the officer any of the following:

(1) Lawful money of the United States or a cashier's check, made payable to the officer, issued by a bank, savings association, or credit union authorized to do business in this state. The money shall be held in trust by the officer in interest-bearing deposit or share accounts.”

“(b) The deposit shall be in an amount or have a face value, or, in the case of bonds or notes, have a market value, equal to or in excess of the amount that would be required to be secured by the bond if the bond were given by an admitted surety insurer.”

The original deposit here was for less than the amount of the judgment or order, not one and one-half times the amount. The deposit accordingly did not comply with the statutory requirements for making a deposit in lieu of bond, and did not give rise to application of a stay.

The opposition does not appear to argue that the combined total remains short as to Lindemann Law Firm, APC. However, the motion objecting to sufficiency of the bond points out that the combined total of the funds posted, $10,009.35 and $5,021.42, is $15,021.77. The sanctions awarded against the firm, again, were $10,024.83. One and one-half times this amount is $15,037.25. This leaves the funds posted short by $15.45. The Court will accordingly order that an additional $15.45 be deposited by judgment debtor Lindemann Law Firm, APC within ten days. The court will then deem the undertaking as to that judgment debtor sufficient, and the court will order that the judgment debtor discovery as to judgment debtor Lindemann Law Firm, APC, and enforcement of the court’s order concerning that discovery, including any monetary sanctions awarded, will be stayed pending resolution of the appeal.

With respect to the argument plaintiff seems to be making that the original amount deposited be deemed sufficient because any claim that there was an additional sum due under the statute based on the one and one- half measure was waived due to failure to timely assert an objection within ten days of service of the notice of posting, this argument is rejected by the court. The court had previously observed that there was no proof of service attached to the original notice of deposit filed with the court, plaintiff’s counsel does not dispute this omission, and counsel for defendant has repeatedly represented to the court that such a notice was not received. Although plaintiff has submitted a proof of service with the ex parte application, the court is of the view that service of the notice of deposit itself, which requires the inclusion of specific language for the benefit of the deposit beneficiary, as opposed to a receipt without context, was required. Moreover, the court is of the view that if service of that notice of deposit was appropriately made on multiple email addresses as now evidently represented, the Notice of Deposit in Lieu of Bond would have been received by at least one of the listed recipients.

With respect to judgment debtors Blake Lindemann, an individual, and Jason Steger, there has been no satisfactory deposit in lieu of bond posted by these parties. The original notice of deposit made no mention of Blake Lindemann as an individual, but served only to bond the liability of the firm. This notice has not been modified or cured. To the extent the second notice of the deposit of additional funds for the first time makes reference to Blake Lindeman, the deposit is not for the full amount required to be deposited, only for the purported additional one-half portion (and, as noted above is not for even that full amount), and the language of the notice does not protect defendant as required under CCP section 995.710

“(c) The deposit shall be accompanied by an agreement executed by the principal authorizing the officer to collect, sell, or otherwise apply the deposit to enforce the liability of the principal on the deposit. The agreement shall include the address at which the principal may be served with notices, papers, and other documents under this chapter.”

7. The funds are being paid directly by Lindemann Law, APC, and not the client or anybody else. The cash deposit may not be used for any other purpose other than to obtain a stay of the enforcement of the Order denying motion to reconsider sanction and underlying sanction orders, return the funds to Lindemann Law, APC (with the right to file a memorandum of costs) if the Appeal is successful, or to enforce the liability of the principals in connection with and solely arising from, the Appeal.”

This is not sufficient to set forth an agreement to bind any party other than Lindemann Law, APC, to apply the deposit to enforce the liability of the principal upon the deposit, despite the mention of Blake Lindemann, who is not mentioned with respect to the purposes for which the deposit may be used.

Plaintiff seems to argue for the first time in the reply that the sanctions were issued jointly and severally, so that only one bond is required for all three judgment debtors. As an initial matter, the premise is not correct that all sanctions at issue here were imposed jointly and severally against all three judgment debtors. As pointed out in the opposition, and in the timeline set forth above, there were discovery sanctions imposed only against Jason Steger. Moreover, even if the premise of this argument were correct, no legal authority is offered for this proposition of joint and several liability in connection with appeal bonding. The argument makes little sense, given that the point of the deposit in lieu of bond is to secure for the person to whom the liability is owed the payment of such liability if the liability is affirmed on appeal. The situation as it now stands presents the possibility that if the judgment on appeal is not affirmed as to the law firm, but is affirmed as to either the individual lawyer or as to plaintiff, defendant would not be able to seek recovery from the deposit in lieu of bond, despite the pursuit of enforcement of the judgments in the meantime having been stayed.

The court will in these circumstances require that judgment debtors Blake Lindemann, an individual, and Jason Steger separately bond their liability, or separately make deposit in lieu of bond in order to obtain a stay of enforcement of their judgment debts and discovery to aid in that enforcement.

Plaintiff also seeks monetary sanctions for the expense of bringing this ex parte application. However, the application is for the most part denied. Moreover, monetary sanctions cannot ordinarily be imposed on an ex parte basis; a noticed motion is required. See Alliance Bank v. Murray (1984, 2nd Dist.) 161 Cal. App. 3d 1, 5-6.

In any case, plaintiff has cited to no legal authority under which monetary sanctions can be awarded in these circumstances, and the notice of motion is not clear with respect to the basis for the sanctions relief sought, against whom such relief is sought, or the nature of the relief sought. No sanctions are awarded.

“(a) An objection shall be in writing and shall be made by noticed motion. The notice of motion shall specify the precise grounds for the objection. If a ground for the objection is that the amount of the bond is insufficient, the notice of motion shall state the reason for the insufficiency and shall include an estimate of the amount that would be sufficient.

(c) If no objection is made within the time required by statute, the beneficiary is deemed to have waived all objections except upon a showing of good cause for failure to make the objection within the time required by statute or of changed circumstances.”

As discussed above, the motion successfully argues that the total amount currently posted does not satisfy the statutory requirement of one and one half of the bond in connection with that judgment debtor, but is short by $15.45, so the amount of the bond is insufficient. Plaintiff in opposition argues that the court deemed the bond due as $1,500, but the transcript submitted shows the court acknowledging the statutory language and making a rough estimate: “COURT: AND WHAT NEEDS TO BE POSTED IS 1.5. THAT’S ABOUT $1,500.” [Ex. 4, p. 22:21-22]. This is not an indication that the court reduced the bond required, and there is no legal authority cited under which the statutory requirements need not be met.

The court accordingly finds defendant’s objection appropriate, and order that an additional $15.45 be deposited by judgment debtor Lindemann Law Firm, APC within ten days. The court will then deem the undertaking as to that judgment debtor sufficient, and the court will order that the judgment debtor discovery as to judgment debtor Lindemann Law Firm, APC, and enforcement of the court’s order concerning that discovery, including any monetary sanctions awarded, is stayed pending appeal.

The court has addressed above the argument that objection has been waived, and again finds that the original Notice of Deposit in Lieu of Bond was not served. There is no dispute by plaintiff that defendant’s current motion was filed on November 4, 2024, which was within ten days of service of the second Notice on October 23, 2024, and is timely.

The objection also points out that bonds have not been posted for the other two judgment debtors, and that plaintiff Jason Steger’s bond would need to be in a higher amount to account for the additional funds awarded against him in three additional prior sanctions awards. The motion does not clearly seek any specific order as to the other judgment debtors in the notice of motion, and the court finds there have been no funds deposited with respect to those parties. To the extent there was an attempt to include judgment debtor Blake Lindemann as the depositor of the second notice of deposit, the court finds this improper and also that the amount of the bond is insufficient. The status quo will remain as to those judgment debtors, that is, there is currently no stay of enforcement of judgment as to those parties pending appeal.

Request for determination that bond/cash deposit posted is sufficient is DENIED. The Court finds that the funds posted on behalf of Lindemann Law Firm, APC are short by $15.45. The Court orders that an additional $15.45 be deposited by judgment debtor Lindemann Law Firm, APC within ten days, for a total deposit of $15,037.25. The Court will then deem the undertaking as to judgment debtor Lindemann Law Firm, APC sufficient, and the Court will order that the judgment debtor discovery as to judgment debtor Lindemann Law Firm, APC, and enforcement of the court’s October 18, 2024 order concerning that discovery, including any monetary sanctions awarded, is stayed pending appeal. If no additional deposit is timely made, the stay of judgment debtor enforcement proceedings as to judgment debtor Lindemann Law Firm, APC will be lifted.

Application as to judgment debtors Blake Lindemann, an individual, and Jason Steger is DENIED. These judgment debtors have failed to make deposit in lieu of bond satisfactory under statute to invoke a stay of the enforcement of judgment procedures in this matter.

The stay of enforcement previously issued by the Court with respect to the discovery propounded on Blake Lindemann, an individual, and Jason Steger is lifted. The Court will hear argument concerning whether judgment debtors intend to promptly make deposits in lieu of bond, or bond their liabilities, and whether it would be appropriate to extend a stay to permit those parties to do so.

The Court finds that the funds posted on behalf of Lindemann Law Firm, APC are short by $15.45. The Court orders that an additional $15.45 be deposited by judgment debtor Lindemann Law Firm, APC within ten days, for a total deposit of $15,037.25. The Court will then deem the undertaking as to judgment debtor Lindemann Law Firm, APC sufficient, and the Court will order that the judgment debtor discovery as to judgment debtor Lindemann Law Firm, APC, and enforcement of the court’s October 18, 2024 order concerning that discovery, including any monetary sanctions awarded, is stayed pending appeal. If no additional deposit is timely made, the stay of judgment debtor enforcement proceedings as to judgment debtor Lindemann Law Firm, APC will be lifted.

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