Judge Randolph M. Hammock, Case BC674584 2023-05-01 Tentative Ruling

Plaintiff Vickers Holding and Finance, Inc., brought this action against Defendants Jossiv Kim and Angelina Kim seeking to recognize and enforce a judgment entered against them in the Netherlands. Plaintiff also alleged fraudulent transfers and civil conspiracy relating to funds owed under the judgment. In November 2018, this Court entered a judgment against Defendants.

Where good cause is shown, courts may enter protective orders limiting depositions. “The court, for good cause shown, may make any order that justice requires to protect any party, deponent, or other natural person or organization from unwarranted annoyance, embarrassment, or oppression, or undue burden and expense.” (Code Civ. Proc., § 2025.420(b).) Courts have considerable discretion in granting and crafting protective orders. (Raymond Handling Concepts Corp. v. Superior Court (1995) 39 Cal.App.4th 584, 588.) A court may quash a subpoena entirely or partially and issue an order to protect parties, witnesses, or consumers from unreasonable or oppressive demands, including violations of privacy. (Code Civ. Proc., §1987.1; Weil & Brown, Civ. Pro. Before Trial (The Rutter Group 2008) ¶ 8:598. See also generally Cal. Prac. Guide: Civ. Trials & Ev. (The Rutter Group 2008) ¶1:91.) The burden of proof is generally on the party seeking the protective order to show good cause for whatever order is sought. (Fairmont Ins. Co. v. Superior Court (2000) 22 Cal.4th 245, 255.)

Plaintiff Vickers Holding and Finance, Inc., brought this action against Defendants Jossiv Kim and Angelina Kim (“Defendants” or “judgement debtors”) seeking to recognize and enforce a judgment entered against them in the Netherlands. Plaintiff also alleged fraudulent transfers and civil conspiracy relating to funds owed under the judgment. In November 2018, the Court entered a judgment against Defendants. From at least June 1, 2020, counsel Gruzman represented the judgment debtors in subsequent proceedings before this court.

After entry of Judgment, the court (Judge Moreton) ordered the judgment debtors to produce certain documents, including their foreign bank records (the “02/27/20 Order”), as well as entered an Assignment Order requiring ordered the judgment debtors to turn over the income they received from certain third party entities to Vickers (the “03/08/20 Order”). The Judgment Debtors failed to comply with those orders.

This, among other things, resulted in a two-day contempt trial against the judgment debtors before Judge Rice in late 2021. Following that trial, the court found Jossiv guilty of eight acts of contempt of court, and Angelina guilty of six acts of contempt of court, including specifically for failure to produce their foreign bank records, and for monetary transfers through various third-party entities in an effort to avoid the Assignment Order. (See Stolyar Decl. , Exh. 8.)

Plaintiff represents that ongoing efforts to collect on the judgment have been completely unsuccessful, allegedly due to judgment debtors’ efforts to conceal and transfer assets. Thus, on November 23, 2022, judgment debtors served judgment debtors’ attorney, Mr. Gruzman, with a deposition subpoena for his personal appearance for deposition and production of documents on December 28, 2022 (the “Subpoena”).

The Subpoena sought five categories of documents. Plaintiff contends the purpose of the Subpoena is “to (i) determine how much of [judgment debtors’] moneys were transferred to Mr. Gruzman, and (ii) to identify and locate the assets presently held by the Judgment Debtors, by asking for any Powers of Attorney granted to Mr. Gruzman by Judgment Debtors to serve as their agent with respect to third parties, such as banks and financial institutions.” (Stolyar Decl. ¶ 15.) Defendants now move for a protective order preventing that deposition.

Generally, depositions of opposing counsel are presumptively improper, severely restricted, and require “extremely” good cause—a high standard. (Spectra–Physics, Inc. v. Superior Court (1988) 198 Cal.App.3d 1487, 1493; see also Trade Center Properties, Inc. v. Superior Court (1960) 185 Cal.App.2d 409, 411.)

There are strong policy considerations against deposing an opposing counsel. The practice runs counter to the adversarial process and to the state's public policy to “[p]revent attorneys from taking undue advantage of their adversary's industry and efforts,” among other things. (C.C.P. § 2018.020, subd. (b).) To effectuate these policy concerns, California applies a three-prong test in considering the propriety of attorney depositions. First, does the proponent have other practicable means to obtain the information? Second, is the information crucial to the preparation of the case? And third, is the information subject to a privilege? (Spectra–Physics, supra, 198 Cal.App.3d at 1494–1495, 1496; see also Estate of Ruchti (1993) 12 Cal.App.4th 1593, 1601 [affirming protective order against deposition of opposing counsel].) The burden on the first two prongs rests with the party seeking the deposition, whereas the burden of asserting a privilege rests with the party opposing the deposition. (Carehouse Convalescent Hosp. v. Superior Ct. (2006) 143 Cal. App. 4th 1558, 1563.)

As an initial matter, Plaintiffs contend that Spectra-Physics and its high standard for deposing an opposing counsel should not apply in this case because it is in post-judgment proceedings. To be sure, some of the policies underlying the general disfavor for attorney depositions are certainly inapplicable in post-judgment proceedings—but other important considerations remain highly relevant. For example, deposing an attorney post-judgment—or the risk that such could happen—would “chill the attorney-client relationship, impede civility and easily lend [itself] to gamesmanship and abuse,” not to mention cause “endless collateral disputes about which attorney statements are protected and which are not.” (Carehouse Convalescent Hosp., supra, 143 Cal. App. 4th at 1563.)

It should also be noted that Gruzman still represents the judgment debtors’ son, Alex Anton Kim, in a separate civil action filed by the same Plaintiff in this case, Vickers Holding. (Gruzman Decl. ¶ 3.) That case necessarily presents issues overlapping with this one. Considering the policy underlying Spectra-Physics, this court finds the test applicable on these facts.

First, it would appear there are little, if any other practicable means to obtain the information sought. The record in this matter reflects that the judgment debtors have obstructed nearly every effort to collect on the judgment entered against them. This included the direct violation of multiple court orders, resulting in a finding of contempt and subsequent jail sentence. Plaintiff has met its burden on this factor.

Second, Plaintiff contends “it is crucial for Vickers to know if Gruzman helped Judgment Debtors transfer their funds to third parties to avoid the Judgment; and if so, who those third parties are, and what amounts were transferred.” (Opp. 9: 15-17.)

There is no evidence, however, beyond speculation, that the attorney actually aided in the fraudulent transfers, or otherwise assisted the judgment debtors in concealing assets. Similarly, the payment of legal fees to counsel, by itself, does not demonstrate wrongdoing on his part, and there is likewise no evidence the funds paid to counsel for his services were “stolen” funds. Were this enough, any attorney representing clients who are alleged to have misappropriated funds could be subject to a later deposition. This, of course, risks “chill[ing] the attorney-client relationship.” (Carehouse Convalescent Hosp., supra, 143 Cal. App. 4th at 1563.)

Of course, it is not lost on this court that the attorney may possess information helpful to Plaintiff in its ongoing collection efforts. But “[d]iscovery was hardly intended to enable a learned profession to perform its functions on wits borrowed from the adversary.” (Spectra–Physics, supra, 198 Cal.App.3d at p. 1494, quoting Hickman v. Taylor (1947) 329 U.S. 495, 516 (conc. opn. of Jackson, J.).)

This court finds that based upon the current record, Plaintiff has failed to meet the “extremely” high burden under prong 2. (Fireman's Fund Ins. Co. v. Superior Court (1977) 72 Cal.App.3d 786, 790.) For that reason, this court need not address whether the information sought is subject to privilege. (See Carehouse Convalescent Hosp., supra, 143 Cal. App. 4th at 1563 [stating that failure to show “any one [factor] may be sufficient to defeat the attempted attorney deposition”].)

Be that as it may, this ruling does not prevent the Judgment Creditor from conducting a future ORAP upon any of the Judgment Debtors and request non-privilege information as to how much money has been previously paid to Mr. Gruzman, (when, why and how, etc), as that information does not appear to violate any attorney-client privilege communications. This ruling merely prevents the Judgment Creditor essentially asking these same questions directly to Mr. Gruzman as part of a formal examination, based upon the current showing. Of course, future facts could change this ruling.

Under CCP 2025.420(h), “the court shall impose a monetary sanction…against any party, person, or attorney who unsuccessfully makes or opposes a motion for a protective order, 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.”

Any party may submit on the tentative ruling by contacting the courtroom via email at Smcdept49@lacourt.org by no later than 4:00 p.m. the day before the hearing. All interested parties must be copied on the email. It should be noted that if you submit on a tentative ruling the court will still conduct a hearing if any party appears. By submitting on the tentative you have, in essence, waived your right to be present at the hearing, and you should be aware that the court may not adopt the tentative, and may issue an order which modifies the tentative ruling in whole or in part.