Judge: Teresa A. Beaudet, Case: 21STCV02421, Date: 2023-10-06 Tentative Ruling

Case Number: 21STCV02421    Hearing Date: November 15, 2023    Dept: 50

Superior Court of California

County of Los Angeles

Department 50

Background

On January 20, 2021, Plaintiff Fredy Vera Corona (“Plaintiff”) filed this action against Defendants Exquisite Apparel Corp. (“Exquisite Apparel”) and Affluent Staffing, LLC (“Affluent”) (jointly, “Defendants”). On March 16, 2023, Plaintiff filed the operative Second Amended Representative Action Complaint (the “SAC”), which contains a single cause of action for violation of the Private Attorneys General Act.

Plaintiff previously moved for an order imposing terminating and monetary sanctions against Exquisite Apparel. No opposition to the motion was filed. On October 6, 2023, the Court issued an order on the motion.

The Court’s October 6, 2023 Order provides, inter alia, that “[b]ased on the foregoing, Plaintiff’s motion is granted in part and denied in part. Plaintiff’s motion for an order ‘issuing a terminating sanction striking Defendant’s Answer to Plaintiff’s First Amended Complaint in its entirety’ is granted. The Court strikes Exquisite Apparel’s answer filed on July 26, 2021. Plaintiff’s motion for monetary sanctions against Exquisite Apparel is granted in part. Exquisite Apparel is ordered to pay monetary sanctions in the amount of $3,421.65 to Plaintiff within 30 days of the date of this Order.”

Exquisite Apparel now moves “for relief from the Court’s October 6, 2023 order striking Exquisite’s July 26, 2021 Answer.” Plaintiff opposes.

Evidentiary Objections

The Court rules on Exquisite Apparel’s evidentiary objections as follows:

Objection No. 1 (paragraph 15): overruled

Objection No. 2 (paragraph 16): overruled

Objection No. 3 (paragraph 17): overruled

Objection No. 4 (paragraph 18): sustained

Objection No. 5 (paragraph 19): sustained

Discussion

Code of Civil Procedure section 473, subdivision (b) provides in pertinent part:  

“The court may, upon any terms as may be just, relieve a party or his or her legal representative from a judgment, dismissal, order, or other proceeding taken against him or her through his or her mistake, inadvertence, surprise, or excusable neglect. Application for this relief shall be accompanied by a copy of the answer or other pleading proposed to be filed therein, otherwise the application shall not be granted, and shall be made within a reasonable time, in no case exceeding six months, after the judgment, dismissal, order,

or proceeding was taken.” 

Code of Civil Procedure section 473, subdivision (b) also contains a mandatory provision: “Notwithstanding any other requirements of this section, the court shall, whenever an application for relief is made no more than six months after entry of judgment, is in proper form, and is accompanied by an attorney’s sworn affidavit attesting to his or her mistake, inadvertence, surprise, or neglect, vacate any (1) resulting default entered by the clerk against his or her client, and which will result in entry of a default judgment, or (2) resulting default judgment or dismissal entered against his or her client, unless the court finds that the default or dismissal was not in fact caused by the attorney’s mistake, inadvertence, surprise, or neglect.”  

Exquisite Apparel states in its notice of motion that “[t]his motion is made pursuant to California Code of Civil Procedure § 473(b) on the grounds that the actions, or non-actions, of Exquisite resulting in issuance of the Order were grounded in mistake, inadvertence, surprise or excusable neglect.” (Notice of Motion at p. 1:7-9.) Exquisite Apparel also asserts that “Mr. Sands has signed a declaration of fault, warranting mandatory relief under Section 473(b). The Court should set aside its Order and permit filing of the Answer by Exquisite filed concurrently.” (Mot. at p. 1:21-23.)[1]

In his declaration in support of the instant motion, Thomas Sands states that “[d]uring my representation of Exquisite, I corresponded via email with Chris Van Hulse, COO of Exquisite, and Sheila Geraghty, its general counsel, using their email addresses @exquisiteapparel.com.” (Sands Decl., ¶ 3.) The Court notes that on November 29, 2022, the Court issued an Order granting Thomas D. Sands’s motion to be relieved as counsel for Exquisite Apparel. Mr. Sands states in his declaration in support of the instant motion that “[t]hough the November 29, 2022 Order granting our motion to withdraw says that it was effective upon filing of a proof of service of the signed order on Exquisite, I never served a copy of that order on Exquisite, whether through the California registered agent, Exquisite’s New York address or the email addresses for Mr. Van Hulse or Ms. Geraghty.” (Sands Decl., ¶ 6.) Mr. Sands states that “[t]hough I thus technically remained counsel for Exquisite throughout the case, I did not send Exquisite copies of Plaintiff’s motions to compel or for terminating sanctions. I did not oppose those motions, which resulted in those motions being granted.” (Sands Decl., ¶ 7.)

In the opposition, Plaintiff asserts that the instant motion “is procedurally improper and mandatory relief does not apply because the Terminating Sanctions Order did not result in a default, default judgment, or dismissal within the meaning of the statute…” (Opp’n at p. 11:18-20.) As set forth above, Code of Civil Procedure section 473, subdivision (b) provides in part that “[n]otwithstanding any other requirements of this section, the court shall, whenever an application for relief is made no more than six months after entry of judgment, is in proper form, and is accompanied by an attorney’s sworn affidavit attesting to his or her mistake, inadvertence, surprise, or neglect, vacate any (1) resulting default entered by the clerk against his or her client, and which will result in entry of a default judgment, or (2) resulting default judgment or dismissal entered against his or her client, unless the court finds that the default or dismissal was not in fact caused by the attorney’s mistake, inadvertence, surprise, or neglect.” (Emphasis added.)

As set forth above, the Court’s October 6, 2023 Order provides, inter alia, that “Plaintiff’s motion for an order ‘issuing a terminating sanction striking Defendant’s Answer to Plaintiff’s First Amended Complaint in its entirety’ is granted. The Court strikes Exquisite Apparel’s answer filed on July 26, 2021.” Plaintiff notes in his opposition to the instant motion that “the Termination Sanctions Order struck Exquisite’s Answer and required the payment of monetary sanctions and no default, judgment, or dismissal was entered.” (Opp’n at p. 10:20-22, emphasis omitted.)

In addition, as noted by Plaintiff, Exquisite Apparel cites to Rodriguez v. Brill (2015) 234 Cal.App.4th 715, 725, but in that case, “Brill’s motion was labeled a motion for dismissal as a terminating sanction and it asked the court to ‘dismiss Plaintiff’s action against Defendant.’ The trial court granted the motion and ordered the complaint stricken as a sanction against Rodriguez for failing to respond to discovery. As a result, a June 9, 2011, ‘JUDGMENT OF DISMISSAL AS A TERMINATING SANCTION’ was filed. The judgment stated ‘the case is dismissed with prejudice.’” The Court of Appeal “conclude[d] the judgment dismissing Rodriguez’s complaint constitutes a ‘dismissal entered’ for purposes of section 473(b).” (Ibid.)

In the reply, Exquisite Apparel asserts that “the Court’s order striking Exquisite’s Answer is tantamount to a default, in that, absent relief, Exquisite will be unable to present its defense at trial.” (Reply at p. 3:11-13.) But Exquisite Apparel does not cite any legal authority to support this proposition for purposes of Code of Civil Procedure section 473, subdivision (b). The Court does not find that Exquisite Apparel has demonstrated that the mandatory provision of Code of Civil Procedure section 473, subdivision (b) is applicable here.

Plaintiff also asserts that Exquisite Apparel’s “motion for relief is discretionary and should be denied.” (Opp’n at p. 11:22-23.) As set forth above, Mr. Sands states that “[t]hough I thus technically remained counsel for Exquisite throughout the case, I did not send Exquisite copies of Plaintiff’s motions to compel or for terminating sanctions. I did not oppose those motions, which resulted in those motions being granted.” (Sands Decl., ¶ 7.) As set forth above, on November 29, 2022, the Court issued an Order granting Mr. Sands’s motion to be relieved as counsel for Exquisite Apparel.

Plaintiff states that after Mr. Sands had been relieved as counsel for Exquisite Apparel, Plaintiff served documents on Exquisite Apparel’s agent for service of process, Registered Agent Solutions, Inc. For instance, Plaintiff’s counsel indicates that “[o]n April 10, 2023, Plaintiff filed his Second Sanctions Motion against Exquisite and served it on Exquisite’s agent for service of process via express mail (i.e., includes tracking information).”  (Alami Decl., ¶ 27.) Plaintiff’s counsel further states that “on August 8, 2023, Plaintiff filed his Third Sanctions Motion against Exquisite and served it by mail on Exquisite’s registered agent for service of process, Registered Agent Solutions, Inc.” (Alami Decl., ¶ 32.) Plaintiff asserts that he “has always served Exquisite either through its counsel Mr. Sands or through its agent for service of process, Registered Agent Solutions, Inc., in this Action.” (Opp’n at p. 12:17-19.) Plaintiff argues that Exquisite Apparel thus fails to establish mistake or inadvertence as a basis for vacating the October 6, 2023 Order.

Plaintiff also asserts that Exquisite Apparel’s “neglect is inexcusable.” (Opp’n at p. 14:13.) Plaintiff argues that “[t]he Terminating Sanctions Order could have been avoided through the exercise of ordinary care. In other words, the Parties would not be here today if Exquisite and/or its counsel complied with its discovery obligations and multiple discovery orders...” (Opp’n at p. 14:17-19.) Plaintiff similarly argues that “[d]ue to Exquisite’s repeated negligence and disregard of these documents that were served, it is precluded from arguing ‘surprise’ as a basis for granting the Motion for Relief.” (Opp’n at p. 14:7-9.)

In the reply, Exquisite Apparel asserts that “Plaintiff’s opposition has no competent evidence that Exquisite received actual notice that it was no longer represented by Thomas Sands, that it was faced with terminating sanctions and, with this knowledge, inexcusably failed to act.” (Reply at p. 5:9-12.)

In the opposition, Plaintiffs’ counsel states that “[a]ttached hereto as Exhibit N is a true and correct copy of the Proof of Service to Thomas Sands’ Third Motion to be Relieved as Counsel for Exquisite, dated November 1, 2022.” (Alami Decl., ¶ 14, pp. 8-9, Ex. N.) However, Plaintiff does not appear to provide evidence that Exquisite Apparel received notice of the Court’s November 19, 2022 Order that the Court granted Mr. Sands’s motion to be relieved as counsel. As set forth above, Mr. Sands states that “[t]hough the November 29, 2022 Order granting our motion to withdraw says that it was effective upon filing of a proof of service of the signed order on Exquisite, I never served a copy of that order on Exquisite, whether through the California registered agent, Exquisite’s New York address or the email addresses for Mr. Van Hulse or Ms. Geraghty.” (Sands Decl., ¶ 6.) Mr. Sands further states that “[t]hough I thus technically remained counsel for Exquisite throughout the case, I did not send Exquisite copies of Plaintiff’s motions to compel or for terminating sanctions. I did not oppose those motions, which resulted in those motions being granted.” (Sands Decl., ¶ 7.)

Exquisite Apparel also submits the “Corrected” Declaration Chris Van Hulse in support of the motion. Mr. Van Hulse is the Chief Operating Officer of Exquisite Apparel. (Van Hulse Decl., ¶ 1.) Mr. Van Hulse states that in this case, Kevin Charco of Affluent Staffing informed Mr. Van Hulse that “Affluent’s counsel, Thomas Sands, would handle the matter for both parties.” (Van Hulse Decl., ¶ 5.) Mr. Van Hulse states that he “received emails from Thomas Sands at [Mr. Van Hulse’s] email address @exquisiteapparel.com, with a copy to Kevin Charco, about a July 21, 2021 Zoom conference including Messrs. Sands and Charco.” (Van Hulse Decl., ¶ 7.) Mr. Van Hulse further states that he “never received any notice to [his] email @exquisiteapparel.com that Mr. Sands’s firm was withdrawing from representation of Exquisite or that Exquisite was potentially, and then actually, suffering terminating sanctions for not responding to discovery that [he] thought Affluent was handling.”  (Van Hulse Decl., ¶ 12.)

Based on the foregoing, the Court finds that Exquisite Apparel has demonstrated grounds for relief under the discretionary portion of Code of Civil Procedure section 473, subdivision (b) on the grounds of mistake and/or inadvertence.[2]

Lastly, Plaintiff asserts that he must be awarded attorneys’ fees and costs if the instant motion is granted. Plaintiff notes that Code of Civil Procedure section 473, subdivision (b) provides that “[t]he court shall, whenever relief is granted based on an attorney’s affidavit of fault, direct the attorney to pay reasonable compensatory legal fees and costs to opposing counsel or parties.” As the Court agrees with Plaintiff that the mandatory provision of Code of Civil Procedure section 473, subdivision (b) is not applicable here, the Court does not see how the foregoing provision pertaining to attorney’s fees and costs is applicable. The Court thus denies Plaintiff’s request for attorney’s fees and costs.  

Conclusion

Based on the foregoing, Exquisite Apparel’s motion for an order for relief from the Court’s October 6, 2023 Order striking Exquisite Apparel’s July 26, 2021 Answer is granted. The Court vacates its October 6, 2023 Order that “[t]he Court strikes Exquisite Apparel’s answer filed on July 26, 2021.”

Exquisite Apparel is ordered to give notice of this Order. 

DATED:  November 15, 2023                        ________________________________

Hon. Rolf M. Treu

Judge, Los Angeles Superior Court