Judge Ralph C. Hofer, Case Number: EC068370, Date: 2023-10-27 Tentative Ruling

Plaintiff Vehanoosh Grigorian brings this legal malpractice action against her former attorneys, defendants Alex Megeredchian and his law practice entities, alleging that during their representation of plaintiff and other partners in a real estate investment joint venture transaction, defendants failed to appropriately advise the parties, and continued representation despite conflicts of interests arising between the partners, ultimately resulting in plaintiff funding the entire real estate purchase, with no written contract to protect plaintiff from the circumstance that two of the other partners’ names remained as purchasers in whom title would vest at closing, and could fail to pay their share of the funding after closing. The partners failed to pay, and the complaint also alleges that although the partners agreed to execute and executed a notarized Reconveyance Grant Deed to plaintiff to facilitate a potential sale of the property, defendant falsely claimed that the deed had been forged, and sent a false letter making such allegations to escrow, and other involved parties, clouding title and derailing plaintiff’s efforts to sell the property and mitigate her damages.

Plaintiff also alleges that in breach of their duties and ethical obligations to plaintiff, their client, and plaintiff’s spouse, also their client, defendants have filed a civil suit against plaintiff and her spouse on behalf of the other two partners, seeking to quiet title to the property in favor of the other partners according to their purported 50% interest. Plaintiff also alleges that in the course of that lawsuit, defendants are improperly using confidential information derived from plaintiff in the course of defendants’ representation of plaintiff.

The file shows that on December 5, 2018, the parties filed, and the Court signed a Stipulation and Order Staying Action, staying this matter for all purposes pending resolution of the other action between the partners, which was pending in Van Nuys.

On October 25, 2019, the Court heard a motion brought by defendants Alex Megeredchian, Megeredchian Law and Law Offices of Alex Megeredchian to lift the stay in this matter, arguing that the Van Nuys action had been unsatisfactorily delayed. The motion was denied, the court finding that defendants had not shown good cause to lift the stay.

These motions were originally scheduled to be heard on September 25, 2020. The minute order indicates that at the hearing, counsel represented to the court that they had lost their Mandatory Settlement Conference date and Trial Date in the Van Nuys action. The Court continued the matters to January 22, 2021 as a “Place Holder Date.” On January 22, 2021, the court again found that the motions were stayed, and continued the matters for “hearing/rescheduling” to October 22, 2021.

The matters have since been continued several times, pursuant to Stipulations and Orders submitted by the parties, as well as minute orders permitting the parties to file motions to lift the stay and provide further information concerning the status of the Van Nuys action.

A review of the docket in the Van Nuys case, LC 106885, shows that there has been no further activity in that matter since the previous hearing in this matter, on July 28, 2023, at which the court continued the matter to October 27, 2023, and ordered that the motions would not be heard unless the court entered an order lifting the total stay of this case, and requiring the moving papers and any oppositions be refiled with the new hearing date, with courtesy copies to be delivered to the department the date of filing. The hearing date was then again continued twice, pursuant to the joint stipulation of the parties. The moving papers and oppositions have not been refiled with the court, although a new timely opposition has been filed to the motion to compel further responses to special interrogatories.

The docket in the Van Nuys case shows that the parties participated in a non-jury trial in October and November of 2021, and filed written closing argument briefs in February of 2022. Following supplemental briefing and oral argument as ordered by the court, and the issuance of a Tentative Statement of Decision in September of 2022, followed by the filing of objections, responses and requests for clarification, on November 17, 2022, the Van Nuys court filed its Statement of Decision and Findings of Fact in the matter.

In the Van Nuys action, plaintiff in this action, Vehanoosh Grigorian, had been sued as a defendant by plaintiffs in that action, Robert Ter-Oganesyan and Meghedy Bandary, along with Zaven Grigorian as defendant. Defendants in that action, the Grigorians, filed a cross complaint to quiet title to the Skytop property as against plaintiffs in that action as cross-defendants.

Judgment was entered in favor of defendants in the Van Nuys action, the Grigorians, on the Second Amended Complaint, with plaintiffs in that action, Ter-Oganesyan and Bandary to take nothing by their complaint. Defendants were deemed the prevailing parties, with costs to defendants pursuant to memorandum of costs and attorney fees to defendants, if allowed by statute or contract, by noticed motion.

Judgment was entered in favor of cross-complainants in the Van Nuys action, the Grigorians, on the First Amended Cross-Complaint, the Van Nuys court declaring that cross-complainants were the 100% owners of the Skytop property, quieting title in favor of cross-complainants, and declaring that cross-defendants in that action, Ter-Oganesyan and Bandary, have no rights, legal or equitable interest in, or title to the Skytop property. The Van Nuys court granted rescission and restitution on cross-complainant’s breach of contract claim. The Van Nuys court awarded monetary damages in favor of cross-complainants in that case, the Grigorians, against cross-defendants Ter-Oganesyan and Bandary, jointly and severally, in the sum of economic damages in the amount of $751,489.29 plus $129,026.22 prejudgment interest (tort claims) plus $195,200.10 (breach of contract claims), for a total of $1,075,715.61.

The file shows that the Van Nuys action was proceeding through briefing on a post-trial motion for attorneys’ fees, which was set to be argued on January 18, 2023. On January 17, 2023, plaintiffs in that action filed a Notice of Stay of Proceedings, indicating that the matter was stayed pursuant to an automatic stay caused by the filing in another court of a bankruptcy petition filed in the United States Bankruptcy Court by Robert Ter-Oganesyan and Meghedy Bandary.

On January 18, 2023, the motion for attorney fees was called for hearing in the Van Nuys action, and the minute order indicates that the case had been stayed by filing of bankruptcy proceedings by plaintiffs. The hearing on the motion for attorney fees was continued to July 17, 2023, and the action was also set for a Status Conference Re: Status of Bankruptcy the same date. The July 17, 2023, the matters were taken off calendar by the Van Nuys court.

The Van Nuys action file also shows that on May 22, 2023, defendants and cross-complainants the Grigorians filed an “Acknowledgment of Satisfaction of Monetary Judgment,” which indicates that the Grigorians acknowledge “full satisfaction of the monetary obligations in the December 5, 2022 Judgment” in that action as follows:

“the Judgment Creditors have accepted payment other than that specified in the Judgment in full satisfaction of the monetary obligations in the Judgment owed to them by Plaintiffs and Cross-Defendants Robert TerOganesyan and Meghedy Bandary (“Judgment Debtors”). For the sake of clarity, this Acknowledgement of Satisfaction of Judgment only applies to monetary aspects of the Judgment and does not serve to extinguish aspects of the Judgment relating to the Judgment Creditors’ sole ownership of the ‘Skytop Property’ including but not limited to Paragraph A on page 2 of the Judgment; those portions of the Judgment shall remain active and in full force and effect.”

The judgment debtors in the Van Nuys case, and bankruptcy petitioners, Ter-Oganesyan and Bandary, are not parties to this Glendale action, but third parties, although one of the motions before this court is for orders compelling Ter-Oganesyan to comply with a deposition subpoena issued in this case. This Glendale action does not appear to be subject to any automatic bankruptcy stay.

The court accordingly will proceed this date to consider the outstanding discovery motions on their merits. As noted above, the parties have not refiled the moving papers and previously filed opposition as previously ordered by the court, but the court has located those documents in the file and considered them. Opposition to the discovery motion pending against plaintiff was timely filed in advance of the current hearing date, on March18, 2024, and has also been considered by the court.

The opposition to the motion indicates that since the filing of the motion plaintiff served responses to the subject discovery. The responses were served on December 31, 2023, after the court vacated the stay of this action and defendants’ counsel granted plaintiff an extension to respond, and before the date set for the hearing. A copy of the responses is submitted with the declaration of counsel, and the responses are verified. [Eisenberg Decl., para. 3, Ex. B].

With respect to the failure to timely respond to interrogatories, under CCP § 2030.290(c), “The court shall impose a monetary sanction… against any party, person, or attorney who unsuccessfully makes or opposes a motion to compel a response to interrogatories, unless it finds that the one subject to the sanction acted with substantial justification or that other circumstances make the imposition of the sanction unjust.”

CCP § 2023.010 provides that misuse of the discovery process includes “(d) Failing to respond or to submit to an authorized method of discovery.” Where there has been such conduct, under CCP § 2023.030(a), “The court may impose a monetary sanction ordering that one engaging in the misuse of the discovery process, or any attorney advising that conduct, or both pay the reasonable expenses, including attorney’s fees, incurred by anyone as a result of that conduct....If a monetary sanction is authorized” by the statute, “ the court shall impose that sanction unless it finds that the one subject to the sanction acted with substantial justification or that the other circumstances make the imposition of the sanction unjust.” CCP § 2023.030(a).

Under CRC Rule 3.1348(a): “The court may award sanctions under the Discovery Act in favor of a party who files a motion to compel discovery, even though no opposition to the motion was filed, or opposition to the motion was withdrawn, or the requested discovery was provided to the moving party after the motion was filed.”

Plaintiff in opposition to the motion argues that sanctions are not warranted, as the discovery was served on plaintiff’s former attorney of record, who did not forward the discovery to plaintiff and did not prepare responses, and the discovery motions were filed while plaintiff remained unaware of the discovery. Two months later, plaintiff’s current counsel substituted in and promptly obtained a stay of proceedings pending final disposition of the Van Nuys action. Plaintiff argues that neither plaintiff nor her current attorney had anything to do with the circumstances that led to the filing of this motion.

The conduct of former counsel, who was indisputably representing plaintiff at the time, is fairly attributed to plaintiff, and the conduct of former counsel in failing to timely respond to the discovery, or request an extension of time to respond, or respond to meet and confer correspondence which was not even statutorily required all clearly necessitated this motion. Hence, the expense of preparing the motion is fairly shifted to plaintiff and/or former counsel. Sanctions are awarded.

Defendant requests $1,060 in the notice of motion, although the declaration in support of the motion supports an award of $1,560. The sanctions will not be awarded in any amount exceeding that requested in the notice of motion. The sanctions sought appear reasonable, and the opposition does not challenge the hours sought or the reasonableness of the sanctions sought, but only argues that sanctions are not warranted at all based on the conduct of former counsel. As discussed above, the expense of bringing the motion is properly shifted to plaintiff in this circumstance. Under the circumstances, the sanctions sought are awarded in full as requested.

This matter remains on calendar for a motion to compel compliance with a subpoena for the appearance at deposition of third-party Robert Ter-Oganesyan. The matter is not currently on calendar for a similar motion brought to compel the deposition of third-party Meghedy Bandary.

Under CCP § 2017.010, “any party may obtain discovery regarding any matter, not privileged, that is relevant to the subject matter involved in the pending action..., if the matter either is itself admissible in evidence or appears reasonably calculated to lead to the discovery of admissible evidence.”

“(a) If a deponent fails to answer any question or to produce any document or tangible thing under the deponent’s control that is specified in the deposition notice or a deposition subpoena, the party seeking discovery may move the court for an order compelling that answer or production.”

“(a) If a subpoena requires the attendance of a witness or the production of books, documents, electronically stored information, or other things before a court, or at the trial of an issue therein, or at the taking of a deposition, the court, upon motion reasonably made by any person described in subdivision (b), or upon the court's own motion after giving counsel notice and an opportunity to be heard, may make an order quashing the subpoena entirely, modifying it, or directing compliance with it upon those terms or conditions as the court shall declare, including protective orders. In addition, the court may make any other order as may be appropriate to protect the person from unreasonable or oppressive demands, including unreasonable violations of the right of privacy of the person.

Here, the subpoena was personally served on the deponent, but evidently no objection was served by the deponent, only by the defendants. The deponent failed to appear for the deposition, and a Certificate of Non-Appearance was prepared. [Torabi Decl., ¶¶ 5-20, Exs. 1, 3, 9]. The motion indicates the deponent, Robert Ter-Oganesyan, is a third-party who was jointly legally represented by defendants in the transaction which is the subject of this lawsuit. [Torabi Decl. ¶¶ 25-28]. Plaintiff argues that the deponent is a key witness in this action and without his testimony in this legal malpractice action cannot be properly prepared.

The opposition filed by counsel for the deponent in 2018 argues that the parties were in the process of stipulating to have this action consolidated with the Van Nuys action, and that plaintiff’s counsel at the time was aware that the deponent was represented by counsel but made no attempt to coordinate the scheduling of the deponent’s deposition with deponent’s counsel or to meet and confer regarding this alleged discovery impasse. [Sievers Decl. ¶¶ 2-9]. Counsel indicates that previous counsel was unclear about whether he would continue to represent plaintiff in this action, and whether the deposition schedule could be set up to avoid the deponent having to be deposed twice by plaintiff—once in this case and once in the Van Nuys case. Counsel indicates that Ter-Oganesyan never refused to have a deposition taken.

The motion seeks in the alternative an order of contempt against the deponent. Since the motion to compel attendance and testimony will be granted, there is no need for an alternative order, and the request for a contempt order is denied.

“A person failing to appear pursuant to a subpoena or a court order also forfeits to the party aggrieved the sum of five hundred dollars ($500), and all damages that he or she may sustain by the failure of the person to appear pursuant to the subpoena or court order, which forfeiture and damages may be recovered in a civil action.”

It is clear that a separate civil action would be required to obtain the forfeiture. While the California Supreme Court has noted that this is an impractical remedy (see New York Times v. Superior Court (1990) 51 Cal.3d 453, 464), this provision remains in the Discovery Act, and does not permit the recovery of sanctions against the third party in this action. The moving papers do not cite any other statutory authority under which sanctions may be awarded.

The deponent in opposition to the motion seeks sanctions under CCP section 2023.030(a), under which “the court may impose a monetary sanction ordering that one engaging in the misuse of the discovery process, or any attorney advising that conduct, or both pay the reasonable expenses, including attorney’s fees, incurred by anyone as a result of that conduct....If a monetary sanction is authorized” by the statute, “ the court shall impose that sanction unless it finds that the one subject to the sanction acted with substantial justification or that the other circumstances make the imposition of the sanction unjust.” CCP §2023.030(a).

Moreover, CCP § 2023.030 is expressly limited: “To the extent authorized by the chapter governing any particular discovery method or any other provision of this title,” the court may impose sanctions for misuse of the discovery process.

Since the opposition papers fail to point to any authorization in the chapter governing subpoenas, or other authorization for a monetary sanction here, the sanctions are denied on this ground. (Sanctions are authorized under CCP § 1987.2 for orders made under CCP § 1987.1, but neither of these statutes are relied upon or mentioned in the opposition papers). Specifically, CCP § 1987.2 provides:

“In making an order pursuant to motion made under subdivision (c) of Section 1987.1, the court may in its discretion award the amount of the reasonable expenses incurred in making or opposing the motion, including reasonable attorneys’ fees, if the court finds the motion was made or opposed in bad faith or without substantial justification or that one or more of the requirements of the subpoena as oppressive.”

Monetary sanctions requested by moving party: Utilizing a lodestar approach, and in view of the totality of the circumstances, the Court finds that the total and reasonable amount of attorney’s fees and costs incurred for the work performed in connection with the pending motion is $1,020.00 (2.5 hours @ $400/hour) (2.5 hours requested/3.9 hours supported) [Amount Requested in notice $1,060/ Amount supported $1,560], which sum is to be awarded in favor of defendants Alex Megeredchian, Megeredchian Law, and Law Offices of Alex Megeredchian, and against defendant Vehanoosh Grigorian, and plaintiff’s former counsel of record, Torabi Litigation Counsel Group, Law Offices of Kasra Torabi, APLC, payable within 30 days. CCP sections 2030.290(c), 2023.010(d), 2023.030(a) and CRC Rule 3.1348(a).

At the concession in the opposition, Third Party Robert Ter-Oganesyan is ordered to appear and give testimony at a deposition to be conducted on a mutually agreeable date and time, at the law offices of the attorney for Robert Ter-Oganesyan, to be completed before April 30, 2024.

The Court notes that the third-party deponent and counsel preparing the opposition to the motion concerning the subpoena should note that this Court finds it distracting and inconvenient to have to search the footnotes to find supporting authority for assertions made in the body of the points and authorities, and for reference to specific supporting evidence. The Court requests that Robert Ter-Oganesyan discontinue the practice of putting the authority and evidentiary references in footnotes and put them in the body of the document, following the statements the authority or evidence purportedly supports.

Please make arrangement in advance if you wish to appear via LACourtConnect by visiting www.lacourt.org to schedule a remote appearance. Please note that LACourtConnect offers free audio and video appearances. However, ADVANCE REGISTRATION IS REQUIRED.