Judge: Ronald F. Frank, Case: 21TRCV00631, Date: 2023-03-29 Tentative Ruling
Case Number: 21TRCV00631 Hearing Date: March 29, 2023 Dept: 8
Tentative Ruling¿
¿¿
HEARING DATE: March
29, 2023
¿¿
CASE NUMBER: 21TRCV00631
¿¿
CASE NAME: Dinesh
Bharat and Prachi Bharat v. Avadhesh Bhagat dba El Dorado Motel
¿¿
MOVING PARTY: Defendant
Avadesh Bhagat
¿¿
RESPONDING PARTY: Plaintiffs
Dinesh Bharat and Prachi Bharat
¿¿
TRIAL DATE: September
25, 2023
¿¿
MOTION:¿ (1) Motion to Quash Subpoenas
(2)
Cross-Requests for Monetary Sanctions
¿
Tentative Ruling: (1) Granted.
However, the Court will hear arguments as to whether the SDT court be
ordered modified such that it is made clear to the two banks that only the
signature cards for the two specified accounts are being sought, and/or that
social security numbers must be redacted.
But first, Plaintiff will need to clarify the legitimate discoverable
purpose of the signature cards
(2)
Denied
¿¿
I. BACKGROUND¿¿
¿¿
A. Factual¿¿
Plaintiffs
Dinesh Bharat and Prachi Bharat (“Plaintiffs”) allegedly worked as property
managers for Defendant Avadhesh Bhagat, individually and doing business as El
Dorado Hotel (“Defendant”) at Defendant El Dorado Hotel (“El Dorado”) motel
complex the four years immediately preceding the filing of this lawsuit. (Complaint ¶ 6.) Around June 12, 2021, Plaintiffs
allegedly filed claims with the Labor Commissioner for unpaid wages. (Complaint
¶ 25.) Shortly after, Defendant allegedly notified Plaintiffs that he
redesignated them from “resident manager” to “night shift manager.” (Complaint
¶ 17.)
On
August 30, 2021, Plaintiffs sued Defendant and El Dorado (collectively,
“Defendants”) for the following: (1) Minimum Wage and Overtime Wages; (2) Employee
Indemnification; (3) Itemized Wage Statements; (4) Misclassification as
Independent Contractors; (5) Unfair Business Practices; and (6) Wrongful
Termination in Violation of Public Policy.
¿
B. Procedural
On January 30, 2023, Plaintiffs purportedly served two deposition
notices for business records to Bank of the West BNP Paribas and Bank of
America. (Decl. Conner ¶ 3, Ex. A.) Each
sought “any and all accounts in the name of Alex Bhagat and/or El Dorado Motel,
including but not limited to account ending in [account number]: the signature
card completed at opening of account and any addenda.” (Decl. Conner ¶ 3, Ex.
A.) Plaintiffs served the notices to consumer the same day. (Decl. Conner ¶ 3,
Ex. A.)
On February 23, 2023, Defendant moved to quash or modify the
deposition subpoena. Defendant also requested sanctions. On March 13, 2023,
Plaintiffs opposed both Defendant’s motion and Defendant’s request for
sanctions. Plaintiffs requested sanctions against Defendant. Defendant filed a
reply on March 22, 2023.
¿
¿II. MEET AND CONFER
The
parties met and conferred from February 17, 2023, to February 20, 2023, but
were unable to resolve their disputes. (Decl. Conner ¶
5, Ex. B.)
¿¿
¿III. ANALYSIS¿
As a preliminary matter, deposition
subpoenas may not be served on the records custodian until at least 5 days after the “consumer” was
served with a copy of the subpoena and notice of privacy rights, i.e., that
consumer records are being sought and that if the consumer objects then the
consumer must file papers such as a motion to quash or serve a written
objection prior to the date set for production. (Code Civ. Pro. § 1985.3(b)(3),
(e).) Failure to comply with the advance notice requirement is a
sufficient basis for the subpoenaed witness to refuse to produce the personal
records sought by the SDT. (Code Civ. Pro. § 1985.3(k).)
Here, the plaintiffs served the deposition subpoenas on Bank of the West BNP
Paribas and Bank of America the same day they served Defendant, the “consumer.”
(Decl. Conner ¶ 3, Ex. A.) Curiously, despite all the other arguments
being made by Defendant, he did not raise the advance-notice requirement of
Section 1985.3(b)(3) as a ground for quashing the SDT.
Defendant argues
that the served subpoenas have not been served on him in violation of Code of
Civil Procedure section 2025.240(a).
(Notice of Motion and Motion, pg. 1, lines 15-18 [Decl. Conner ¶ 4].) However,
Defendant’s assertion is based on a misreading of the cited statute, which
requires a party to serve notice of deposition on all parties that have
appeared. Plaintiffs have done that. (Code Civ. Proc. § 2025.220, subd.
(b) (copy of the deposition subpoena serves as the notice of deposition
when a party seeks the production by a nonparty of business records for copying.)
¿
A.
Legal
Standard ¿
Code of Civil Procedure section¿1987.1(a)¿states,
“[i]f a subpoena requires the attendance of a witness or the production of
books, documents, 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.”¿¿
“[U]pon¿motion reasonably made by the party, judges
may rule upon motions for quashing, modifying or compelling compliance with
subpoenas.”¿¿(Lee v. Swansboro Country Property Owners¿Assn.¿(2007) 151
Cal.App.4th 575, 582-83.)
A deposition subpoena may be quashed for:¿(1)
defects in form or content of the subpoena (e.g., inadequate description of
requested records); (2) defects in service of the subpoena (e.g., failure to
satisfy the requirements of providing notice to consumer); (3)
requesting¿production of records not within the permissible scope of discovery;
(4) being unjustly burdensome or oppressive; (5) with
regard to requested ESI discovery,
objection to the specified form for
producing the ESI (Code Civ. Pro. § 1985.8(c)) or
objection to production on the ground that the ESI is from a source that is not
reasonably accessible because of undue burden and expense (Code Civ. Pro. § 1985.8(e)); (6) “consumer’s”
right of privacy in “personal records” (Code Civ. Pro. § 1985.3(e)); and (7)
employee’s right of privacy in “employment records” (Code Civ. Pro. § 1985.6(e).)¿ (Weil & Brown,¿Civ.
Proc. Before Trial, ¶¿8:598.)¿
B.
Discussion
Motion to Quash
Defendant moves to quash both subpoenas on the grounds
that: (1) Defendant’s bank records are not relevant or discoverable; (2)
Defendant’s bank records are subject to privacy protections, and the intrusion to
Defendant’s privacy outweighs disclosure of these records. (Notice of Motion
and Motion to Quash pg.1, lines 4-7.) As a preliminary matter, Plaintiffs have
clarified that they seek only the signature cards “on each of the accounts.”
(Opposition pg. 2, lines 3-7.)
Relevance
All unprivileged information that is relevant
to the subject matter of the action is discoverable if it would itself
be admissible evidence at trial or if it appears reasonably calculated to lead
to the discovery of admissible evidence. (Code Civ. Pro. § 2017.010; Schnabel
v. Super. Ct. (1993) 5 Cal.4th 704, 711.) For discovery
purposes, information is relevant if it might
reasonably assist a party in evaluating the case, preparing for trial, or
facilitating settlement. (Gonzalez v. Super. Ct.
(1995) 33 Cal.App.4th 1539, 1546.) The burden is on the party seeking the
constitutionally protected information to establish direct relevance. (Harris
v. Super. Ct. (1992) 3 Cal.App.4th 661, 665.)
Here, Defendant argues that none of the information
Plaintiffs seek is relevant. (Notice of Motion and Motion, pg. 5, lines 1-9.) Defendant
argues the number of bank accounts a businessperson owns does not tend to prove
or disprove unfair or “unscrupulous” business dealings. (Notice of Motion and
Motion, pg. 5, lines 3-9.) Defendant also argues that establishing whether
Defendant operates outside the tax code is improper. (Notice of Motion and
Motion, pg. 5, lines 10-26.) However, Defendant bases this argument on his belief
that Plaintiffs seek Defendant’s bank records, not the signature cards, to
compare them with its tax records. (Notice of Motion and Motion, pg. 5, lines 21-24.)
Defendant additionally argues that a confirmation that the two bank accounts belong
to Defendant is not relevant and would not lead to admissible evidence. (Notice
of Motion and Motion, pg. 5-6, line 28; 1-2.) Also, Defendant argues that bank
records in general are not relevant to the issues in litigation and cannot
plead to relevant evidence. (Notice of Motion and Motion, pg. 4, line 28; 17-22.)
As discussed above, Plaintiffs concede that they seek only the signature cards,
not all of Defendant’s bank records. Plaintiff has not argued in the opposition
what the “addenda” are that were included in the list of documents to be
produced by the banks, or sought to explain why addenda to signature cards would
be discoverable. Did plaintiffs intend
to capture second pages of the signature cards where additional lists of names with
signature authority over the account might be listed, such as where there is
insufficient space on the first page of the signature card?
In
opposition, Plaintiffs argue that the information sought is discoverable
because Defendant operates his motel business “outside the law.” (Opposition,
pg. 3, lines 19-22.) Plaintiffs argue
that Defendant considers everyone that works there an independent contractor
and that he cheats the City of Los Angeles out of room taxes. (Opposition, pg. 3,
lines 22-25.) However, Plaintiffs base their statement about taxes on
inadmissible hearsay; thus, it cannot be considered. (Bharat Decl. ¶ 2.) Further, even if Plaintiffs’ belief is
correct, it is not at all clear that bank signature cards would tend in reason
to prove those beliefs, or that the trier of fact could consider the ad hominem
or bad character evidence being asserted.
Plaintiffs do not address how the number of banks accounts a
businessperson owns nor how a confirmation that bank accounts belong to
Defendant relates to their claims. Thus, Plaintiffs have not met their burden to
establish that the signature cards they seek is reasonably calculated to lead
to the discovery of admissible evidence for any of Plaintiffs’ causes of
action.
Thus,
Plaintiffs’ discovery requests should be quashed on this ground. However, the
Court can conceive of discoverable purposes for the bank signature cards even
though such purposes have not been articulated in the opposition papers. The Court will consider oral argument from
Plaintiffs as to a legitimate, discoverable purpose for a subpoena limited to
the signature cards.
Privacy
When
the information sought to be discovered impacts a person’s constitutional right
to privacy, limited protections come into play for that person. (Shaffer
v. Super. Ct. (1995) 33 Cal.App.4th 993, 999.) The protections
cover both a person’s personal and financial matters.
(Id.) The court must balance competing
rights — the right of a litigant to discover relevant facts and the right of an
individual to maintain reasonable privacy — in determining whether the
information is discoverable. (Id.)
The party asserting a privacy interest must establish its
extent and the seriousness of the prospective invasion, and against that
showing the court must weigh the countervailing interests the opposing party
identifies. (Williams
v. Super. Ct. (2017) 3 Cal.5th 531, 557.) What suffices to justify an
invasion will vary according to the context. (Id.) Only obvious
invasions of interests fundamental to personal autonomy must be supported by a
compelling interest. (Hill
v. Nat'l Collegiate Athletic Assn. (1994) 7 Cal.4th 1,34-35.)
Defendant
argues that Plaintiffs seek his personal bank account information “with no
limitations.” (Notice of Motion and Motion, pg. 3, line 1.) Defendant argues
that the information is “highly sensitive” and bears no reasonable relation to
any issues in this case and that Plaintiffs only are trying to “dig up dirt” on
Defendant. (Notice of Motion and Motion, pg. 3, lines 1-3.) Defendant further
argues that because Plaintiffs’ request is so broad, his privacy interest
outweighs the likelihood that the requested information will lead to any
admissible evidence. (Notice of Motion and Motion, pgs. 3-4, lines 25-28; 1.) In
opposition, Plaintiffs argue that Defendant has not addressed the extent and
seriousness of the invasion of privacy. (Opposition, pg. 6, lines 1-5.) In
reply, Defendant argues that because the signature cards Plaintiffs seek may
contain the identifying information of any non-party account holders, the
request violates the non-party account holders’ First Amendment right to freely
associate. (Reply, pg. 5, lines 9-15.) Defendant argues that it also violates its
First Amendment right to freely associate because the request may identify the
organizations Defendant associates with. (Reply, pg. 3, lines 2-3.) Defendant
further argues that Plaintiffs seek this information to try to show that Defendant
did not pay city taxes, which is not a compelling interest. (Reply, pg. 6,
lines 13-16.) Here, the privacy interests of any non-party account holders are
not relevant, however, because they are not parties to this lawsuit. Defendant
has established the extent and seriousness of its invasion of privacy in its
recent filing. Because there is no invasion of interest fundamental to personal
autonomy here, Plaintiffs need not have a compelling interest in the
information sought. Plaintiffs’ interest, i.e., to show that Defendant operates
its motel business “outside the law,” does not outweigh Defendant’s privacy
interests.
Thus,
Plaintiffs’ bank subpoenas should be quashed denied on the privacy ground in
addition to the notice compliance issue and discoverability issues discussed
above.
Sanctions
California
Code of Civil Procedure section 1987.2 provides that “the court may in
its discretion award the amount of reasonable expenses incurred in making or
opposing [a motion to quash], including reasonable attorney’s 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 was oppressive.” (Code Civ.
Proc. § 1987.2(a).)
Here, Defendant argues that he
met and conferred with Plaintiffs and requested that Plaintiffs withdraw the
subpoenas and instead, stipulate to an informal discovery conference and that
Plaintiffs refused. (Notice
of Motion and Motion, pg. 8, lines 3-6.) Defendant also argues that Plaintiffs
suggested no legitimate reason for seeking the records but instead admitted
their strategy was to seek inadmissible information to support an argument that
Defendant operates outside the tax code. (Notice of Motion and Motion, pg.8, lines
6-10.) In opposition, Plaintiffs argue that the
court should not reward sanctions because Defendant cited inapplicable
authority during their meet and confer efforts. (Opposition, pgs. 8-10.) Plaintiffs
did not address the informal discovery conference. Plaintiffs also did not
address Defendant’s argument that the reason for seeking the records is not
legitimate.
Plaintiffs also seek
sanctions. Plaintiffs argue that they spent time addressing Defendant’s inapplicable
authority.
Defendant seeks $6,180.00 in
sanctions. Plaintiffs seek $5,000.00 in sanctions.
The court notes that during
the meet and confer efforts, neither party attempted to clarify that the
discovery requests were limited to signature cards rather than Defendant’s broader
bank records. The parties could have focused their efforts on clarifying the
discovery issue and resolving it. Instead, the parties filed motions and argued
at length about matters not even at issue. Because of what appears to be a lack
of cooperation from both sides, no sanctions will be rewarded to any party.
IV. CONCLUSION¿¿
¿¿
Based on the foregoing, this Court grants the motion
to quash and denies both parties’ requests for sanctions.