Judge: Ronald F. Frank, Case: 22TRCV00095, Date: 2023-04-26 Tentative Ruling
Case Number: 22TRCV00095 Hearing Date: February 29, 2024 Dept: 8
Tentative Ruling¿
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HEARING DATE: February 29, 2024¿
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CASE NUMBER: 22TRCV00095
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CASE NAME: Carlo A. Coppola v.
Luxe H2O, Inc., et al.
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MOVING PARTY: Plaintiff,
Carlo A. Coppola
RESPONDING PARTY: Defendant,
Luxe H2O, Incorporated
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TRIAL DATE: Not Set.
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MOTION:¿ (1) Motion to Compel the Deposition of Defendant’s Person Most
Knowledgeable and Production of Documents
(2) Request for
Sanctions
¿ Tentative Rulings: (1) ARGUE.
(2) Deferred
I. BACKGROUND¿¿
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A. Factual¿¿
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On February 9, 2022,
Plaintiff Carlo A. Coppola (“Plaintiff”) filed a complaint against Defendant
Luxe H2O, incorporated (“Luxe”) and DOES 1 through 100 for the following causes
of action: (1) negligence; (2) breach of contract; and (3) breach of express
warranty. This matter involves allegations of construction defects and damages
to Plaintiff’s residence located 6369 West 84th Street, Los Angeles,
California 90045 (“Subject Property”). Defendant, Luxe filed an answer on May
9, 2022. On November 28, 2022, Plaintiff filed a First Amended Complaint. On
February 9, 2024, Plaintiff filed a Second Amended Complaint (“SAC”) for: (1)
Negligence; (2) Breach of Contract; and (3) Breach of Express Warranty; and (4)
Recovery on Contractor’s State License Bond.
Plaintiff notes that on
November 20, 2023, he noticed the deposition of Luxe’s person most qualified
(“PMQ”). Plaintiff contends that on December 10, 2023, Defendant served an
objection to Plaintiff’s Notice of Deposition of the PMQ, and also indicated
that Luxe would be producing Lori Sewell as Luxe’s PMQ. Plaintiff further asserts
that on December 19, 2023, he took the deposition of Luxe’s PMQ
regarding certain categories of testimony, but Plaintiff contends the Ms. Sewell
was not actually the person most qualified. Plaintiff argues that this was
apparent as Ms. Sewell provided virtually no information responsive to the
categories specified in the deposition notice. Further, Plaintiff contends that
Ms. Sewell admitted to making no effort to obtain information despite such
information being available. For nearly all categories of information requested
in the deposition notice, Plaintiff contends Ms. Sewell admitted she did
nothing to prepare herself for the deposition including failing to even try and
talk to her brother, Gary M. Sewell, Jr., who was the primary person at Luxe
who managed the Project at Plaintiff’s home. Further, Plaintiff contends that
Ms. Sewell also admitted to failing to even try contacting other former owners
of Luxe, including Matthew Jenson and Daniel Longmire, despite having their
contact information.
Based
on the above, Plaintiff contends that Defendant failed to comply with Code of
Civil Procedure § 2025.230 which requires that an entity deponent “designate
and produce those of its officers, directors, managing agents, employees, or
agents who are most qualified to testify on its behalf as to those matters
[specified in the notice] to the extent of any information known or reasonably
available to the deponent.” As such, Plaintiff brings this motion for an order
requiring Luxe to appear for deposition and provide its actual PMQ.
B. Procedural¿¿
On January 16, 2024, Plaintiff filed this
Motion to Compel the Deposition of Defendant’s PMK and Production of Documents.
On February 7, 2024 Luxe filed an opposition. On February 14, 2024, Plaintiff
filed a reply brief.
II. ANALYSIS¿
A. Legal
Standard
Code of Civil Procedure
section 2025.450, section (a) provides:
“If, after service of a deposition notice, a party to the action
or an officer, director, managing agent, or employee of a party, or a person
designated by an organization that is a party under Section 2025.230, without
having served a valid objection under Section 2025.410, fails to appear for
examination, or to proceed with it, or to produce for inspection any document,
electronically stored information, or tangible thing described in the
deposition notice, the party giving the notice may move for an order compelling
the deponent’s attendance and testimony, and the production for inspection of
any document, electronically stored information, or tangible thing described in
the deposition notice.”
(Code Civ. Proc., § 2025.450,
subd. (a).)
The motion must “be
accompanied by a meet and confer declaration under Section 2016.040, or, when
the deponent fails to attend the deposition…by a declaration stating that the
petitioner has contacted the deponent to inquire about the nonappearance.” (Code
Civ. Proc., § 2025.450, subd. (2).) A court shall impose monetary sanctions if
the motion to compel is granted unless the one subject to sanctions acted with
substantial justification or other circumstances would make the imposition of
the sanction unjust. (Code. Civ. Proc., § 2025.450, subd. (g)(1).)
B. Discussion
Preliminarily,
the Court notes that in Defendant’s opposition, it argues that Plaintiff’s
separate statement fails to comply with California Rules of Court, Rule 3.1345(c). But the Court
does not find that argument availing given the thrust of the motion is not to
compel further answers to specific questions, but rather to set up an
evidentiary bar at trial precluding Luxe from presenting evidence about which
its designated most knowledgeable witness failed to answer. To use a popular television show analogy, Defendant
Stalag 13 might well be subject to an order on motion in limine barring any other
Luxe employee from rebutting Sgt. Schultz’ testimony of “I know nothing.” In the absence of proof that Luxe has another
current officer, director, managing agent, employee or agent who was more
qualified or knowledgeable about the PMQ categories than Ms. Sewell, a different
form of separate statement could not have been presented here.
Meet and Confer
Pursuant to Code of Civil Procedure
§ 2025.450, Plaintiff was required to meet and confer in good faith prior to
the bringing of this motion. Plaintiff asserts that on January 4, 2024,
Plaintiff sent a meet and confer email to Luxe requesting they designate a
qualified PMQ, who will comply with the statutory requirements and who are
qualified to testify on the matters in the deposition notice. On January 9,
2024, counsel for Defendant responded by refusing to produce another PMQ,
arguing that Ms. Sewell was the PMQ of Luxe. As such, this Court notes that
Plaintiff has met his requirements under the statute in an attempt to meet and
confer in good faith prior to the filing of this motion.
Motion
to Compel the Deposition
Here, Plaintiff has provided that
the deposition requested testimony from Luxe regarding the following categories
and included a request for production of documents:
1. The
submission of any and all bids, estimates, proposals, contracts, plans,
drawings, specifications, correspondence, and any and all other written
communications by LUXE with respect to work at the SUBJECT PROPERTY
("SUBJECT PROPERTY" refers to 6369 West 84th Street, Los Angeles
90045, that is the subject of this litigation).
2. Any
and all communications between LUXE and Plaintiff with respect to work at the
SUBJECT PROPERTY.
3. Any
and all communications between LUXE and any subcontractor with respect to work
at the SUBJECT PROPERTY.
4. Any
and all communications with respect to work at the SUBJECT PROPERTY.
5. The
identification of any and all materials reviewed by LUXE in preparing any and
all bids, estimates, proposals, contracts, plans, drawings, specifications,
engineering calculations, correspondence, and any and all other materials
reviewed with respect to work at the SUBJECT PROPERTY.
6. Any
and all work or services performed by LUXE with respect to the SUBJECT
PROPERTY, including, but not limited to, LUXE's scope of work, and/or work
performed on LUXE's behalf.
7. The
negotiation and execution of any and all agreements and contracts by LUXE with
respect to your work at the SUBJECT PROPERTY, including the negotiation of
express warranties.
8. Any
individuals or entities hired by LUXE to perform work at the SUBJECT PROPERTY.
9. Any
employees of LUXE that performed work at the SUBJECT PROPERTY.
10. LUXE's
organizational and/or corporate structure.
11. LUXE's
insurance policies and coverage there under from 2017 to present.
12. Any claims
made by Plaintiff regarding LUXE's work at the SUBJECT PROPERTY.
13. Any and all
settlements entered into between LUXE and Plaintiff regarding LUXE’s work at
the SUBJECT PROPERTY.
14. Any and all
contractors state license board complaints made against LUXE within the past 10
years.
15. LUXE’s
licensing status with the contractors state license board.
16. Any ongoing
projects where LUXE is currently performing work.
17. LUXE's
document retention policies and/or procedures. (Id.)
Luxe is Not
Required to Produce a Different PMQ
Plaintiff
also notes that the notice of deposition also included various requests for
production of documents. Plaintiff argues that he is entitled to the above
discovery and that the failure to acquire and provide information reasonably
available is essentially the same as not providing answers at all. (citing Maldonado
v. Superior Court (2002) 94 Cal.App.4th 1390 (“Maldonado”).) In Maldonado,
petitioners brought suit against their former employer, and codefendants,
alleging employment discrimination. (Id. at 1392.) Petitioners there
submitted three deposition notices to their employer seeking to depose the PMK
concerning subjects relating to termination. The notices also asked that
documents be produced from a number of categories. (Id. at 1393.) At the
deposition, the designated PMK for the employer neglected to bring the
employee’s personnel file with her to the deposition or to review it before the
deposition. (Id. at 1393-1394.) The PMK also did not know anything about
the employee’s employment history, although she had received his letter of
resignation, nor did she know whether it would have been possible to terminate
an employee in his position without involving the human resources department. (Id.
at 1394.)
Another
set of PMKs who were designated concerning a footprint issue (a policy of the
employer’s known as “footprinting” which petitioners described as “the racially
based segregation of Los Angeles into regions where sales and services would be
provided by the employer and where sales and service would not be provided.”)
The PMKs designated to this issue did not bring any documents to the
deposition. (Ibid.) Counsel for the employer stated that there had been
difficulty putting documents relevant to the request together due to the
employer’s bankruptcy filing, and that the company was still in the process of
looking for said documents. (Ibid.) The PMK did not know what the
footprint was for Los Angeles County in the relevant years were, whether it had
substantially changed since then, whether the maps depicting the footprint
existed, where any such maps might be found, or whether there was anyone at the
company who would know the answers to the questions. (Ibid.) Instead, it
was noted that the PMKs had a general knowledge about the factors that went
into deciding the limits of the footprint or sales and service area – such as
estimated sales volume and existence of technology support – but were unaware
of whether any studies had been conducted to determine or predict whether the
factors were favorable or unfavorable. (Ibid.)
After
these sets of depositions had concluded, the petitioners brought motions to
compel further responses with regard to all three depositions, seeking: (1) an
order compelling the employer to provide further depositions of the PMK
regarding various issues and to fully respond to all outstanding requests for
documents; (2) an order that noting in the event the PMK fails to provide
discovery to any relevant line of inquiry…defendants be precluded from
introducing testimony at trial or asserting affirmative defenses as to matters
to which they refused to disclose information; and (3) attorneys fees and costs
of bringing the motion. (Ibid.) The trial court denied all the motions
with the exception that in any further depositions of the ‘most knowledgeable,’
that the employer produce all related documents for the relevant years that it
has or can find on a reasonable search. (Id. at 1395.)
A
petitioner for writ of mandamus was filed, and the Second District held that
the trial court should have ordered the employer to bring their witnesses back
to the depositions with the documents requested and with proof that the
witnesses had undertaken some effort to familiarize themselves with the areas
of their supposed “knowledge.” (Id. at 1397.) The Court further found
there was no basis for the trial court’s denying petitioners the opportunity to
discovery pertaining to footprinting, noting it found such relevant and
admissible. (Ibid.) As noted by
Plaintiff in his Reply brief, the Rutter Group practice guide cites Maldonado
for the proposition that the company designee who does not know about a
category “is supposed to find out form those who do,” or in Maldonado from the documents
in the company’s possession, custody or control.
Here, Plaintiff argues that like in Maldonado,
Ms. Sewell’s failure to speak with her brother, the individual who allegedly
spearheaded the project at Plaintiff’s property is a failure to obtain
information that is reasonably available to the deponent. Ms. Sewell further
admitted to Plaintiff that she did nothing to prepare herself for the
deposition including failing to talk to her brother and failing to try to
contact other former owners of Luxe, including Matthew Jenson and Daniel
Longmire despite having their contact information. As such, Plaintiff argues
that Luxe should be required to provide a deponent who has made the effort to
obtain the information or who is aware of the information. At minimum,
Plaintiff argues that if Luxe insists on designating Ms. Sewell as its PMQ, she
should be required to speak to her previous co-owners about this project as she
clearly has the ability to contact them based upon her testimony. But there is nothing
in Maldonado or the statute that requires the PMQ to interrogate former
employees or former owners to help answer questions in a PMQ deposition.
With respect to Plaintiff’s request
seeking an order for Defendant to produce a different PMQ, such as Gary M.
Sewell, Jr., Matthew Jenson, or Daniel Longmire, the Court in Maldonado
refutes this request. The Second District made a point to clarify who may be
compelled to appear when the deposition notice seeks the PMQ/PMK within a
corporation. Section 2025.230 states that the entity party shall designate and
produce at the deposition those of its officers, directors, managing agents,
employees, or agents who are most qualified to testify on its behalf as to
those matters to the extent of any information known or reasonably available to
the deponent.” As such, the Code applies only to current officers, directors,
managing agents, or employees. “Persons formerly affiliated with a party (e.g.,
former officers or employees) are not required to attend a deposition unless
subpoenaed.” (Weil & Brown, Cal. Practice Guide: Civil Procedure Before
Trial, ¶ 8:518, p.8E-26.4.) Nor is there a basis in Maldonado or the statute to
obligate Ms. Sewell to contact former employees or former owners to satisfy her
obligation as a PMK. The three men
suggested by Plaintiff who may have more information are, on the record
presented, no longer affiliated with Luxe in any capacity, and Luxe would not
have been required to designate these individuals as their PMQ. Nor is Ms.
Sewell required to conduct an investigation outside of company employees and extant
company records to prepare for her PMQ deposition. Ms. Sewell might be subject to impeachment at
trial if the facts develop that a former employee or owner readily had
knowledge she might have readily obtained from them about the PMQ categories,
but that is an issue for another day.
Luxe
asserts that this case is factually distinguishable from Maldonado –
where the record showed that the entity deliberately ignored and refused to
produce its own company records including the plaintiff’s personnel file -- because
all of the Luxe documents that exist, which came from Luxe’ former counsel,
were in fact reviewed by the PMK and produced to Plaintiff. (Declaration of
James Pazos (“Pazos Decl.”), ¶ 7, Sewell Deposition, p. 69:16-19.) Unlike the
documents and information in Maldonado, Defendant argues that there are
no additional documents available for production and/or for the PMK to review.
Instead, Defendant maintains that the responsive documents that are “readily
available” have been produced and were reviewed by the PMK before the
deposition. (Pazos Decl., ¶ 7, Sewell Deposition, p. 69:16-19.) The Court may well bind Luxe to that set of representations
come motion in limine time.
In this case, Defendant has
identified Ms. Sewell as the only remaining officer or person at Luxe, as well
as an owner of the company. She also happens to be the current Responsible
Managing Officer (“RMO”)(as of 2018) who is the daughter of the individual who
started the company. In her deposition, she notes that she is the PMQ for Luxe
regarding its organizational and corporate structure. (p. 30:5-8.) Despite
this, Ms. Sewell noted she had no information regarding that category of
inquiry (p. 30:9-11), and her deposition was replete with answers in the
negative to such inquiries. For example, Ms. Sewell noted that she did not know
what year her father started the company (p. 25:10-12); did not know what year
the company was incorporated (p. 25:15-17); did not know who the officers of
the company were in 2018 (p. 26:6-11); did not know anything about the
formation of Luxe (p. 32:7-18); did not know when she became an owner of Luxe
(p.35:19-24); did not what percentage of the company she or the other owners of
Luxe have (p. 43:11-21); did not know what employees’ job titles duties were
(p. 50:24 – 51:3.) Although the Court is mindful that Ms. Sewell admits she
does not know anything about Plaintiff’s project on his subject property, one would
think that Ms. Sewell should have at least been able to provide answers and
documents regarding the organizational and corporate structure should any such
corporate records still exist. The Court
may need oral argument to further develop this point.
Further, this Court is confused as
to what documents were produced by Defendant Luxe to Plaintiff already, and
whether or not Ms. Sewell reviewed those documents, and was prepared for her
deposition, and whether she showed up to the deposition with said documents or
whether they were produced already in discovery. The Court in Maldonado
noted that the trial court there had found that petitioners “had the right to
ask the person most knowledgeable to bring in all of the documents that they
felt are supportive” and that “defense was wrong in not reproducing for the
deposition the documents that they say they had previously produced.” (Maldonado,
supra, 94 Cal.App.4th at 1397.) As
such, the Court seeks clarification on whether documents were brought with Ms.
Sewell to the deposition, even if already produced in response to other
discovery.
Moreover, with regard to Ms. Sewell
educating herself and preparing for the deposition, the Court also requires
clarification. Plaintiff argues that Ms. Sewell admitted in her deposition that
she did nothing to educate herself regarding the categories of the deposition
besides read the categories themselves (p. 30:12-18.) In fact, Ms. Sewell said
she looked for documents, but could not find any. (p. 30:19-20.) This suggests,
to the Plaintiff at least, that Ms. Sewell acted in a “cavalier” manner as to
her deposition as did the HR manager in Maldonado. However, Defendant
cites to page 69, line 19, where when asked if she reviewed any documents
before she came to her deposition that included any correspondence between
Plaintiff and Luxe that occurred during her project, she stated “I reviewed the
– this case and the last case.” The Court requests oral argument to clarify
this discrepancy.
Lastly, as to this issue, the
parties raise the question of whether a PMQ is required to reach out to
individuals, no longer at the company, in order to receive relevant
information. Plaintiff’s argument suggests that Ms. Sewell could have
reasonably received information from her brother, Mr. Jenson, or Mr. Longmire.
For example, in her deposition, Ms. Sewell notes that she spoke with her
brother the week before her deposition, but did not talk to him about this case,
despite her knowing that he was the owner of Luxe during the early 2017 time
frame. (p. 34:3-7; 60:21-23.) The Maldonado Court noted that “[w]hen a
request for documents is made, however, the witness or someone in authority is
expected to make an inquiry of everyone who might be holding responsive
documents or everyone who knows where such documents might be held.” (Maldonado,
supra, 94 Cal.App.4th at 1396.) However, the Second District decision did
not touch on whether these inquiries must be made to former employees.
Neither party provides any case law
or support for their side as to this argument. As such, the Court requests oral
argument as to this issue. But given the postponement of the trial and the
Court’s granting of leave to amend to add former owners or employees of Luxe as
defendants subject to discovery, the onus might be shifted to Plaintiff, not
Ms. Sewell, to ask questions of the persons Plaintiff claims the PMQ should
have interrogated in preparation for her deposition.
Evidentiary
Sanctions
In Plaintiff’s reply brief (where it
is improper to raise an argument for the first time) it foreshadows an
intention to seek an order to exclude all testimony outside of that provided by
Luxe’s PMQ. The Petitioners in Maldonado requested a similar evidentiary
sanction. (Maldonado, supra, 94 Cal.App.4th at 1398.) There, the
Petitioners requested the Court, as a sanction, to instruct the trial court to
issue an order precluding “defendants from introducing testimony at trial or
asserting affirmative defenses as to matter to which they refused to disclose
information” and further requested that “defendants” be precluded from
“spring[ing] these witnesses” who no longer work on for the employer on
petitioners at trial. (Ibid.) In Maldonado, the Court stated that
“sanctions involving issue preclusion are not generally imposed at this point
in a discovery dispute. But that intention will be reviewed anew during the motion
in limine phase of this case. The Court will
not impose evidentiary sanctions at this time, a point raised for the first
time in the Reply brief.
Monetary
Sanctions
Lastly, Plaintiff seeks monetary
sanctions in the amount of $1,924.85 as against Defendant and its attorney of
record. This amount is based on Plaintiff’s representation that he was charged
$1,840.35 in court reporter fees for the first PMQ deposition, $61.75 for the
reservation of this motion, and will be charged $22.75 by an attorney service
to file this motion. The Court defers the issue of sanctions pending the conclusion
of the merits of the motion.