Judge Stephanie M. Bowick, Case Number: 22STCV29225, Date: 2024-12-04 Tentative Ruling

Judge: Stephanie M. Bowick, Case: 22STCV29225, Date: 2024-12-04 Tentative Ruling

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CASE NAME: Associated Petroleum Products, Inc. v. Gloria Leonor Cubides, et al.

CASE NUMBER: 22STCV29225 (Consolidated w/ Case No. 24STCV01702)

DATE FILED: 09/08/2022

TRIAL DATE: 09/23/2025

PROCEEDING: ¿Motion [To] Compel Further Response From Krystal Enterprises, LLC To Request For Production, Set One And Request For Sanctions

MOVING PARTY: Defendant/Cross-Complainant Gloria Cubides

OPPOSITION: Plaintiff/Cross-Defendant Krystal Enterprises LLC

REPLY: None received

TENTATIVE RULING After consideration of the briefing filed, Defendant/Cross-Complainant Gloria Cubides’s Motion [To] Compel Further Response From Krystal Enterprises, LLC To Request For Production, Set One And Request For Sanctions is DENIED in its entirety.

STATEMENT OF THE CASE

This consolidated action arises out of alleged breach of contract. In Case No. 22STCV29225, Plaintiff Associated Petroleum Products, Inc. (“APP”) brings suit against Defendants Gloria Leonor Cubides, Akop Hakopian, and Veronica Escamilla (collectively, “Defendants”) alleging the following causes of action:

Plaintiff APP alleges that Defendant Cubides executed a “Confidential Credit Application and Acknowledgement of Terms” (the “Credit Agreement”) as well as a personal guaranty for delivery of fuel to a fuel service station located at 1871 Colorado Blvd., Los Angeles, California 90041.

Plaintiff APP alleges that Defendants breached the agreements “by failing and refusing to pay the principal sum of $3,302,968.43.”

In the Third Amended Cross-Complaint (“TACC”), Defendant Gloria Leonor Cubides (hereafter, “Defendant Cubides” or “Cross-Complainant Cubides”) alleges the following causes of action against Plaintiff APP:

Cross-Complainant Cubides alleges that APP breached the Credit Agreement by failing to accurately bill for the fuel and the proper prices, and made fraudulent misrepresentations concerning their ability to accurately bill for the fuel at quoted prices in order to induce her to enter into the agreement.

On August 6, 2024, the Court consolidated Case No. 22STCV29225 and Case No. 24STCV01702.

In Case No. 24STCV01702, Plaintiffs Krystal Enterprises LLC (“Krystal”) and Veronica Escamilla (collectively, “Plaintiffs”) bring suit against Defendant Gloria L. Cubides dba C T Propane alleging the following cause of action:

Plaintiffs allege it entered into a written Lease Agreement for the lease of a gas station at 1871 Colorado Blvd. Los Angeles, CA that provides that Defendant indemnify Plaintiffs “against any and all claims, judgments, causes of action, damages, penalties, costs, liabilities, and expenses… incurred in the defense of any such or any action or proceeding… arising at any time… in connection with (1) any default in the performance of any obligation on Tenant's part to be performed under the terms of this Lease, or (ii) Tenant's use of the Premises, the conduct of Tenant's business or any activities, work or things done, permitted or suffered by Tenant in or about the Premises or other portions of the Project, except to the extent caused by Landlord's gross negligence or willful 10 conduct...”

Plaintiffs allege that they tendered a defense and indemnity to Defendant Cubides against the claims asserted against her in Case No. 22STCV29225, but that Defendant breached the Lease Agreement by refusing to acknowledge her indemnity obligations and failing to provide Plaintiffs with a defense in Case No. 22STCV29225.

On June 24, 2024, in Case No. 24STCV01702, Defendant/Cross-Complainant Cubides filed her verified First Amended Cross-Complaint (the “FACC”) against Cross-Defendants Krystal Enterprises LLC, Veronica Escamilla, Akop Hakopian a/k/a Apy Hakopian a/k/a Jack Hakopian, Merit Propane, Inc., Angelina Alocer, and EZ Fuel (collectively, “Cross-Defendants”) alleging the following causes of action:

In the FACC, Defendant/Cross-Complainant Cubides alleges that she, “Escamilla and their respective husbands, Armen and Akop Hakopian, formed a partnership that owns and operates a collection of three gasoline service stations.”

Defendant/Cross-Complainant Cubides alleges that the partners created two entities to act as agents of the partnership: Krystal Enterprises, LLC, which was created as the partnership’s agent to hold title to real estate, and CT Propane Fuel, Inc. (hereafter, “CT Propane”), which was created as the partnership’s agent to operate the petroleum service station businesses.

The FACC alleges that “[i]n aid of the partnership, Cubides transferred her home to Escamilla, who later transferred it to Krystal, to use as collateral for the partnership’s needed business loans. Thereafter, the assets were commingled.”

The FACC alleges that, following the passing of Defendant/Cross-Complainant Cubides’s husband, Armen Hakopian, Escamilla and Akop Hakopian “began a campaign to take for themselves all of the equity and assets of the partnership and exclude Cubides.” The FACC alleges that, “[w]hen Cubides discovered this, she revoked Hakopian’s access to one of the partnership’s bank accounts,” and “[i]n retaliation, Escamilla denied Cubides’ rights and role in the partnership altogether and now seeks to leave Cubides solely responsible for the liabilities of the partnership.”

Defendant/Cross-Complainant Gloria Cubides (hereafter, “Defendant Cubides”) filed the instant Motion [To] Compel Further Response From Krystal Enterprises, LLC To Request For Production, Set One And Request For Sanctions (the “Motion”).

GROUNDS FOR MOTION

Pursuant to Code of Civil Procedure section 2031.310, Defendant Cubides moves for an order compelling further responses by Plaintiff Krystal to Defendant Cubides Request for Production of Documents, Set One, Nos. 32 and 33, and for sanctions against Plaintiff Krystal in the amount of $1,000.00 for reasonable attorney’s fees and costs.

Before bringing a motion to compel further responses to any discovery request, the moving party is required to make efforts to meet and confer in good faith and must submit a declaration attesting to those efforts. (Code Civ. Proc., §§ 2030.300(b); 2031.310(b)(2); 2033.290(b).) “A meet and confer declaration in support of a motion shall state facts showing a reasonable and good faith attempt at an informal resolution of each issue presented by the motion.” (Code Civ. Proc. § 2016.040.) However, a discovery motion need not be denied automatically based upon the reason that the moving parties failed to meet and confer in good faith. (See Obregon v. Sup. Ct. (1998) 67 Cal.App.4th 424, 434.)

The notice of motion must be served within 45 days after service of the responses in question; otherwise, the demanding party waives the right to compel any further responses. (See Code Civ. Proc., §§ 2030.300(c); 2031.310(c); 2033.290(c); Sperber v. Robinson (1994) 26 Cal.App.4th 736, 745; see also Code Civ. Proc., § 1013 [extending notice time if served by mail, overnight delivery, or fax].) However, the parties can also agree in writing on a specific later date by which to file the motion to compel. (Code Civ. Proc., §§ 2030.300(c); 2031.310(c); 2033.290(c).) The 45-day time limit is mandatory and jurisdictional. (Sexton v. Sup.Ct. (Mullikin Med. Ctr.) (1997) 58 Cal.App.4th 1403, 1410.)

Any motion involving the content of a discovery request or the responses to such a request shall also be accompanied by a separate statement providing all information necessary to understand each discovery request and all the responses at issue. (Cal. R. Ct., 3.1345(a), (c); but see Code Civ. Proc., § 2030.300(b)(2); 2031.310(b)(3); 2033.290(b)(2) [“In lieu of a separate statement required under the California Rules of Court, the court may allow the moving party to submit a concise outline of the discovery request and each response in dispute.”].)

Here, the Court finds that Defendant Cubides has complied with all the requisite procedural requirements. The Motion was filed and served on July 25, 2024, or forty-five (45) days after service of Plaintiff Krystal’s responses to Defendant Cubides’s Request for Production of Documents, Set One, which were served on June 10, 2024. (Fabi M. Behnam Decl., ¶ 4; accord, Opposition, p. 2.)

The Court finds that the declaration of Fabi M. Behnam satisfies the meet and confer requirements, (Behnam Decl. at. ¶¶ 6-9, Ex. C), and rejects Plaintiff Krystal’s argument that Defendant Cubides failed to satisfy the meet and confer requirements. (See Opposition at pp. 3-4.)

A motion to compel further responses to a demand for production of documents may be brought if (1) a statement of compliance with the demand is incomplete; (2) a representation of inability to comply is inadequate, incomplete, or evasive; and/or (3) an objection in the response is without merit or too general. (Code Civ. Proc., § 2031.310(a).)

A representation of inability to comply must (1) affirm a diligent search and reasonable inquiry has been made in an effort to comply with that demand; (2) specify whether the inability to comply is because the particular item or category has never existed, has been destroyed, has been lost, misplaced, or stolen, or has never been, or is no longer, in the possession, custody, or control of the responding party; and (3) set forth the name and address of any natural person or organization known or believed by that party to have possession, custody, or control of that item or category of item. (Code Civ. Proc. §2031.230.)

“If only part of an item or category of item in a demand for inspection, copying, testing, or sampling is objectionable, the response shall contain a statement of compliance, or a representation of inability to comply with respect to the remainder of that item or category.” (Code Civ. Proc., § 2031.240(a).)

If the responding party objects to the demand for inspection, copying, testing, or sampling of an item or category of item, the response shall do both of the following:

(1) Identify with particularity any document, tangible thing, land, or electronically stored information falling within any category of item in the demand to which an objection is being made.

(2) Set forth clearly the extent of, and the specific ground for, the objection. If an objection is based on a claim of privilege, the particular privilege invoked shall be stated. If an objection is based on a claim that the information sought is protected work product under Chapter 4 (commencing with Section 2018.010), that claim shall be expressly asserted.

Further, “[i]f an objection is based on a claim of privilege or a claim that the information sought is protected work product, the response shall provide sufficient factual information for other parties to evaluate the merits of that claim, including, if necessary, a privilege log.” (Code Civ. Proc., § 2031.240(c)(1).)

A motion to compel further production “shall set forth specific facts showing good cause justifying the discovery sought by the demand.” (Code Civ. Proc., § 2031.310(b)(1).) Where “there is no privilege issue or claim of attorney work product, that burden is met simply by a fact-specific showing of relevance.” (Glenfed Development Corp. v. Superior Court (1997) 53 Cal.App.4th 1113, 1117 (citing Weil & Brown, Cal. Practice Guide: Civil Procedure Before Trial 2 (Rutter 1996) ¶¶ 8:1495.6 to 8:1495.10, pp. 8H–21 to 8H–22).)

To be relevant for purposes of discovery, the information sought must be relevant to the “subject matter” of the pending action or to the determination of a motion in that action. (Code Civ. Proc., § 2017.010.) The legal standards for admissibility of evidence at trial is quite different than the legal standards applicable for purposes of discovery, and materials or information need not be admissible to be discoverable. (See, e.g., Glenfed Dev. Corp., supra, 53 Cal.App.4th at 1117 [“Admissibility is not the test, and it is sufficient if the information sought might reasonably lead to other, admissible evidence.”]; Gonzalez v. Superior Court (1995) 33 Cal.App.4th 1539, 1546; Davies v. Superior Court (1984) 36 Cal.3d 291, 301.) “Relevancy to the subject matter has been construed to be broader than relevancy to issues and may vary with the size of the case.” (Bridgestone/Firestone, Inc. v. Superior Court (Rios) (1992) 7 Cal.App.4th 1384, 1392 (internal citations omitted).)

For discovery purposes, information is relevant if it might reasonably lead to admissible evidence or might reasonably assist a party in evaluating the case, preparing for trial, or facilitating settlement. (Gonzalez, supra, 33 Cal.App.4th at 1546; see Code Civ. Proc., § 2017.010 [“…[a]ny party may obtain discovery regarding any matter, not privileged, that is relevant to the subject matter involved in the pending action or to the determination of any motion made in that action, if the matter either is itself admissible in evidence or appears reasonably calculated to lead to the discovery of admissible evidence.”].) The rules are applied liberally in favor permitting discovery, which means that the so called “fishing expedition” may be permitted in some cases. (Stewart v. Colonial Western Agency, Inc. (2001) 87 Cal.App.4th 1006, 1013; see Gonzalez, supra, 33 Cal.App.4th at 1546.) There is no “single, comprehensive standard of relevancy,” but past cases have provided certain guidelines. (Pacific Tel. & Tel. Co. v. Superior Court (1970) 2 Cal.3d 161, 172.)

In deciding a motion to compel further responses brought pursuant to Code of Civil Procedure section 2031.310, courts consider not only the stated objections to the discovery requests, but also the requests themselves, as well as the pleadings, and the contentions of the propounding party as to the purpose and validity of the inspection demands. (Columbia Broadcasting System, Inc. v. Superior Court for Los Angeles County (1968) 263 Cal.App.2d 12, 18.)

Once good cause is shown, the burden shifts to the party opposing the motion to justify the objection(s). (Kirkland v. Superior Court (2002) 95 Cal.App.4th 92, 97.)

Further, Code of Civil Procedure section 2031.060, subdivision (b) provides that:

The court, for good cause shown, may make any order that justice requires to protect any party or other person from unwarranted annoyance, embarrassment, or oppression, or undue burden and expense. This protective order may include, but is not limited to, one or more of the following directions:

(1) That all or some of the items or categories of items in the demand need not be produced or made available at all.

(2) That the time specified in Section 2031.260 to respond to the set of demands, or to a particular item or category in the set, be extended.

(4) That the inspection, copying, testing, or sampling be made only on specified terms and conditions.

(5) That a trade secret or other confidential research, development, or commercial information not be disclosed, or be disclosed only to specified persons or only in a specified way.

(6) That the items produced be sealed and thereafter opened only on order of the court.

(Code Civ. Proc., § 2031.060(b); see Code Civ. Proc., § 2017.020(a) ["The court shall limit the scope of discovery if it determines that the burden, expense, or intrusiveness of that discovery clearly outweighs the likelihood that the information sought will lead to the discovery of admissible evidence."].)

“The objection based upon burden must be sustained by evidence showing the quantum of work required, while to support an objection of oppression there must be some showing either of an intent to create an unreasonable burden or that the ultimate effect of the burden is incommensurate with the result sought.” (West Pico Furniture Co. of Los Angeles v. Superior Court In and For Los Angeles County (1961) 56 Cal.2d 407, 417.) However, “[w]hen discovery requests are grossly overbroad on their face, and hence do not appear reasonably related to a legitimate discovery need, a reasonable inference can be drawn of an intent to harass and improperly burden.” (Obregon v. Superior Court (1998) 67 Cal.App.4th 424, 431.)

Here, the Court agrees with Plaintiff Krystal’s arguments in Opposition and finds that Defendant Cubides fails to show good cause justifying further responses to Defendant Cubides’s Request for Production of Documents, Set One, Nos. 32 and 33.

Defendant Cubides’s Request for Production of Documents, Set One, Nos. 32 and 33 seeks, respectively, all of Plaintiff Krystal’s bank statements and tax returns for the last ten (10) years.

In response to Defendant Cubides’s Request for Production of Documents, Set One, Nos. 32 and 33, Plaintiff Krystal objected on the grounds that the requests invaded Plaintiff Krystal’s right of privacy, are overbroad, and are not reasonably calculated to lead to the discovery of admissible evidence.

Defendant Cubides argues that Plaintiff Krystal’s bank statements and tax returns for the last ten (10) years are relevant because Plaintiff Krystal holds title to two of the three gasoline service stations owned and operated by a partnership formed in or about 2004 between Defendant Cubides, Escamilla, and their respective husbands, Armen and Akop Hakopian, and Defendant Cubides alleges that “Hakopian and Escamilla, in part through the vehicle of [Krystal], have converted partnership assets for their personal benefit and are attempting to leave Cubides holding all of the partnership liability is the record holder.” (Separate Statement, pp. 2-5; Motion, p. 2.)

However, as argued by Plaintiff Krystal, (Opposition at p. 4), in her verified responses to discovery propounded by APP, Defendant Cubides stated that CT Propane is not a partnership, but rather a sole proprietorship, that she is the only owner of CT Propane, and that the relationship between her and Escamilla was a landlord-tenant relationship. (Opposition at p. 3 (citing Mitchel T. Stanton Decl., ¶ 2, Exs. A-C).)

Moreover, Defendant Cubides concedes that Plaintiff Krystal has a right to privacy in the records at issue, but contends that her need for the information outweighs Plaintiff Krystal’s privacy interest. (Motion at pp. 4-5.)

The California Supreme Court in Hill v. National Collegiate Athletic Assn. (1994) 7 Cal.4th 1 “sets forth in detail the analytical framework for assessing claims of invasion of privacy under the state Constitution.” (Pioneer Electronics (USA), Inc. v. Superior Court (2007) 40 Cal.4th 360, 370 (citing Hill, supra, 7 Cal.4th at 35); accord, Williams, supra, 3 Cal.5th at 552-557.)

“The party asserting a privacy right must establish a legally protected privacy interest, an objectively reasonable expectation of privacy in the given circumstances, and a threatened intrusion that is serious.” (Williams, supra, 3 Cal.5th at 552 (citing Hill, supra, 7 Cal.4th at 35-37).)

“The party seeking information may raise in response whatever legitimate and important countervailing interests disclosure serves, while the party seeking protection may identify feasible alternatives that serve the same interests or protective measures that would diminish the loss of privacy. (Id. (citing Hill, supra, 7 Cal.4th at 37-40).) “A court must then balance these competing considerations.” (Ibid.)

If a serious invasion of privacy interest has been established, the party seeking the information must show “that the information requested is ‘directly relevant’ to their claims and ‘essential to the fair resolution’ of their lawsuit.” (Alch v. Superior Court (2008) 165 Cal.App.4th 1412, 1425-1430.)

Defendant Cubides argues that the information “¿is critically important to this case in that an accounting cannot be prepared without it and it is necessary to track down where the partnership money has been going over the years,” and “how the money was transferred would help to identify what sources of information exist to corroborate the amount, the fact of the transfer itself, and the date of that transfer.” (Motion, p. 4.) Yet, Defendant Cubides also contends that the funds at issue were allegedly embezzled and/or converted “from a bank account in Cubides’ name to Glen Oaks Escrow.” (Motion at p. 2; Separate Statement at pp. 3, 5.) Thus, the Court agrees with Plaintiff Krystal that Defendant Cubides can look at her own bank statements to determine this information and already knows to whom the funds were transferred.

Given the very broad nature of the request and the fact that Defendant Cubides can look at her own bank statements, the Court finds that Defendant Cubides fails to sufficiently show that her need for the records as requested outweighs Plaintiff’s Krystal’s undisputed right to privacy in the records.

In sum, the Court agrees with Plaintiff Krystal that Defendant Cubides fails to establish that Plaintiff Krystal’s bank statements and tax returns for the last ten (10) years might reasonably lead to admissible evidence or might reasonably assist a party in evaluating the case, preparing for trial, or facilitating settlement and that Defendant Cubides’s need for the information outweighs Plaintiff Krystal’s privacy interests in the records.

The Court also considers the fact that Defendant Cubides failed to file any reply brief.

Code of Civil Procedure section 2031.310, subdivision (h) provides, in relevant part:

…the court shall impose a monetary sanction under Chapter 7 (commencing with Section 2023.010) against any party, person, or attorney who unsuccessfully makes or opposes a motion to compel further response to a demand, 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.

Since the Motion is denied, the Court also DENIES Defendant Cubides’s request that the Court impose sanctions against Plaintiff Krystal.