Judge Theresa M. Traber, Case 22STCV28423 2023-03-07 Tentative Ruling

Judge: Theresa M. Traber, Case: 22STCV28423, Date: 2023-03-07 Tentative Ruling

Case Number: 22STCV28423 Hearing Date: March 7, 2023 Dept: 47

Tentative Ruling

Judge Theresa M. Traber, Department 47

HEARING DATE: March 7, 2023 TRIAL DATE: NOT SET

CASE: William T. Waters, Jr. v. AT&T Inc. et al.

CASE NO.: 22STCV28423

(1) MOTION FOR SANCTIONS PURSUANT TO CODE OF CIVIL PROCEDURE § 128.7

(2) RULING ON OSC WHY THIS ACTION SHOULD NOT BE STAYED, RATHER THAN DISMISSED, PENDING RESOLUTION OF ARBITRATION

MOVING PARTY: (1) (2) Defendants AT&T, Inc.; AT&T Services, Inc.; Pacific Bell Telephone Co. (Simultaneous briefing on OSC)

RESPONDING PARTY(S): (1) (2) Plaintiff William T. Waters, Jr. (Simultaneous briefing on OSC)

STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

This is an action for employment discrimination that was filed on August 31, 2022. Plaintiff alleges that Defendants wrongfully terminated him and then refused to rehire him based on his age and perceived disability.

Defendants move for sanctions pursuant to Code of Civil Procedure section 128.7. The Court also rules on the issue of why this action should not be stayed, rather than dismissed, pending resolution of the arbitration in the action entitled Waters v. DirecTV, LASC Case No. 20STCV05580.

TENTATIVE RULING:

Defendants’ Motion for Sanctions pursuant to Code of Civil Procedure section 128.7 is DENIED.

The Court enters an interlocutory judgment pursuant to Code of Civil Procedure section 597 that no trial of any other issues in this matter shall be had until final determination of the action titled Waters v. DirecTV, LASC Case No. 20STCV05580.

Defendant is ordered to draft and submit a propose interlocutory judgment by March 17, 2023. The Court sets a non-appearance case review for March 31, 2023 to review the proposed judgment and any objections thereto.

DISCUSSION:

Motion for Sanctions

Defendants move for sanctions pursuant to Code of Civil Procedure section 128.7.

Requests for Judicial Notice

Defendants request that the Court take judicial notice of (1) the Complaint filed in Waters v. DirecTV, LASC Case No. 20STCV05580; (2) Defendants’ Notice of Motion to Compel Arbitration and Stay All Proceedings filed in that action; (3) Plaintiff’s Opposition to the Motion to Compel Arbitration in that Action; and (4) the Notice of Ruling attaching the Court’s ruling on the Motion to Compel Arbitration in that action. Defendants’ requests are GRANTED pursuant to Evidence Code section 452(d) (court records).

Legal Standard

Under Code of Civil Procedure section 128.7, if the Court determines that subsection (b) has been violated, it may “impose an appropriate sanction upon the attorneys, law firms, or parties that have violated subdivision (b) or are responsible for the violation.” (Code Civ. Proc. § 128.7(c).) Violations of subsection (b) include presenting a complaint “primarily for an improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation,” presenting claims, defenses, or other legal contentions that are not “warranted by existing law or by a nonfrivolous argument for the extension, modification, or reversal of existing law or the establishment of new law,” or making allegations or factual contentions that do not “have evidentiary support.” (Code Civ. Proc. § 128.7(b)(1) – (3).) Sanctions under this section “shall be limited to what is sufficient to deter repetition of this conduct or comparable conduct by others similarly situated.” (Code Civ. Proc. § 128.7(d).) The sanction may include, “if imposed on motion and warranted for effective deterrence, an order directing payment to the movant of some or all of the reasonable attorney’s fees and other expenses incurred as a direct result of the violation.” (Id.) To obtain sanctions the moving party must show the “party’s conduct in asserting the claim was objectively unreasonable,” meaning that “any reasonable attorney would agree that [it] is totally and completely without merit.” (Bucar v. Ahmad (2016) 244 Cal.App.4th 175, 189.) Indeed, even “the fact that a plaintiff fails to provide a sufficient showing to overcome a demurrer or to survive summary judgment is not, in itself, enough to warrant the imposition of sanctions.” (Peake v. Underwood (2014) 227 Cal.App.4th 428, 448.)

Compliance with the Safe Harbor Provisions of Code of Civil Procedure § 128.7(c)(1)

Before bringing this motion, Defendants must demonstrate compliance with the safe harbor provision of section 128.7. This section provides, in relevant part:

A motion for sanctions under this section shall be made separately from other motions or requests and shall describe the specific conduct alleged to violate subdivision (b). Notice of motion shall be served as provided in Section 1010, but shall not be filed with or presented to the court unless, within 21 days after service of the motion, or any other period as the court may prescribe, the challenged paper, claim, defense, contention, allegation, or denial is not withdrawn or appropriately corrected.

(Code Civ. Proc. § 128.7(c)(1).)

Defendants complied with this provision by serving Plaintiff with the motion on October 26, 2022. (Proof of Service.) Plaintiff therefore had until November 18, 2022 (21 days plus 2 days for service by email) to withdraw the Complaint. Plaintiff did not do so, and Defendants filed this motion that day. Thus, Defendants have met the requirements of the safe harbor provisions.

Analysis

Defendants move for sanctions under Code of Civil Procedure section 128.7 on the grounds that the Complaint in this action was filed for the improper purpose of evading the Court’s ruling compelling arbitration in the prior identical action, and that the Complaint was knowingly filed without legal or factual support.

Defendants first argue that this Complaint was filed for the improper purpose of evading the Court’s December 10, 2020 minute order compelling arbitration in the action entitled Waters v. DirecTV, LASC Case No. 20STCV05580 (the “prior action”.) In sustaining Defendants’ demurrer to the Complaint in this action, the Court ruled that the facts alleged implicated the same primary rights as those asserted in that prior action. (November 30, 2022 Minute Order.) Defendants argue that the December 10, 2020 Order compelling arbitration in the prior action required Plaintiff to arbitrate all potential claims against Defendants, not merely those asserted in that action. However, the Court made no such determination, nor could it have done so, as the Court did not have jurisdiction to decide controversies that had not yet arisen. The Court only concluded that the causes of action asserted in the prior case were within the scope of the arbitration agreement. (Defendants’ RJN Exh. D p. 7.)

Notwithstanding their misapprehension of the Court’s ruling, Defendants are correct that Plaintiff’s claims in this action are subject to the December 10, 2020 order because they are identical causes of action as a matter of law. That said, the Court only reached that determination after analyzing the causes of action asserted herein under the primary rights doctrine, which no less than our Supreme Court has stated “is notoriously uncertain in application. “Despite the flat acceptance of the . . . theory . . . by California decisions, the meaning of ‘cause of action’ remains elusive and subject to frequent dispute and misconception.’” (Baral v. Schnitt (2016) 1 Cal.5th 376, 395 [quoting 4 Witkin, Cal. Procedure (5th ed. 2008) Pleading § 35, p.100].) The Court cannot conclude that Plaintiff’s Complaint in this action was frivolous because it was in violation of the Court’s December 10, 2020 order where the basis for that determination rests on the application of a theory that is “notoriously uncertain in application.”

Defendants also argue that the Complaint in this action was frivolous independent of the effect of the December 10, 2020 Minute Order because it was filed without evidentiary or legal support in violation of section 128.7 subdivisions (b)(2) and (3). Defendants state that, in a deposition taken on August 30, 2022 in the prior action, Plaintiff testified away all of his claims in that case. Specifically, when asked whether Plaintiff had any reason to think whether anyone employed by Defendants was biased against him based on his age or mental health, Plaintiff answered in the negative. (Declaration of Mario Ortega ISO Mot. Exh. B. pp. 35:6-36:1.) Plaintiff also stated that he never requested an accommodation for his condition, (p.47:4-22), never made any complaints relating to his employment, had no reason to think his termination was in retaliation for anything he did, (p. 59:14-22) and had no reason to think that he was not rehired on the basis of his age or mental health or in retaliation for his conduct. (pp. 59:24-60:25.) The Complaint in this action was filed one day later.

Upon first inspection, Plaintiff’s decision to file this action the day after such a disastrous deposition in the previous action certainly creates the appearance that this action was knowingly filed without evidentiary support or a basis in existing law. As Plaintiff argues in opposition, however, the questions asked in Plaintiff’s deposition inquired into the facts giving rise to the causes of action that were already pending on the day of the deposition. It is not apparent that Plaintiff offered any deposition testimony as to subsequent attempts to be rehired which are the factual basis for this case. Defendants’ assertion that Plaintiff was on notice that the deposition questions encompassed all injuries to date is not clear from either the deposition itself, or from the meet and confer correspondence provided. (Ortega Decl. Exh. A.) Further, that correspondence itself shows that Plaintiff was preparing to file this action as of August 29, 2022, before the deposition took place. (Id.) What is more, each of the deposition responses upon which Defendants rely were subject to objections. (See generally Ortega Decl. Exh. B.) Defendants offer no clarification on the disposition of those objections by the arbitrator, and the Court cannot rely on evidence to which there are pending objections that have not been litigated. The Court cannot conclude, based on this evidence, that the Complaint in this action was knowingly filed without evidentiary or legal support such that sanctions are warranted for violation of section 128.7.

Defendants have not demonstrated that the Complaint was filed to advance an improper purpose in violation of subdivision (b)(1) of section 128.7, nor have they demonstrated that the Complaint was knowingly filed without legal or evidentiary support, in violation of subdivisions (b)(2) and (3). Defendants are therefore not entitled to sanctions under Code of Civil Procedure section 128.7.

Conclusion

Accordingly, Defendants’ Motion for Sanctions pursuant to Code of Civil Procedure section 128.7 is DENIED.

Ruling on Order to Show Cause Why this Case Should Not Be Stayed Pending Resolution of Arbitration

In ruling on Defendant’s demurrer to the Complaint, the Court concluded:

[t]he successful basis for Defendants’ demurrer – that another action is pending on the same cause of action – is a plea in abatement. “A plea in abatement, without disputing the justness of plaintiff's claim, objects to the place, mode, or time of asserting it and requires pro hac vice that the judgment be given for the defendant, leaving it open to renew the suit in another place, or form, or at another time.” (V & P Trading Co. v. United Charter, LLC (2012) 212 Cal. App. 4th 126, 133 [citation omitted].) The proper mode of abatement in such a case is a stay of the action that may be lifted if and when the reason for abatement dissipates. (People ex rel. Garamendi v. American Autoplan, Inc. (1993) 20 Cal.App.4th 760, 771 [“Where abatement is required, the second action should be stayed, not dismissed.”]; see also County of Santa Clara v. Escobar (2016) 244 Cal. App. 4th 555, 565 -568 [discussing supporting authorities].) A stay rather than a dismissal appears to be the proper course in this action because accepting a plea in abatement is not intended to prevent the plaintiff from prosecuting the abated cause of action if and when the cause for abatement is removed. (Id., at p. 568.)

(November 30, 2022 Minute Order.) As a result, the Court requested briefing from the parties on the issue of whether this case should be stayed or dismissed. The parties have briefed this issue pursuant to the Court’s order, and so the Court now rules on this question.

Plaintiff disagrees with the Court’s ruling on the demurrer, but contends that, if the Court is not inclined to overrule the demurrer, binding precedent expressly requires that the Court stay this action pending resolution of the prior case. As Plaintiff observes, it is well-established that “[t]he only relief to which a litigant is entitled upon the plea, by either demurrer or answer, that a prior action between the same parties is pending and undetermined is the judgment specified by section 597, Code of Civil Procedure, that the second action abate.” (Lord v. Garland (1946) 27 Cal.2d 840, 851; see also Karp v. Dunn (1964) 229 Cal.App.2d 192, 195 c.)

Defendants, in opposition, argue that the literal meaning of the term “abatement” calls for dismissal rather than a stay of the action. As Defendants admit, however, the legal meaning of the term is unsettled. (See, e.g., Burnand v. Irigoyen (1943) 56 Cal.App.2d 624, 628 [“The plea in abatement, . . . known to the common law and recognized by statute in some of the states, has no existence as a doctrine or remedy in California. The terms abate and abatement are not defined by statute and neither has any specific application to any statutory procedure.”].) Defendants assert that the relevant statutes and case law command an interpretation of the term that requires dismissal. The Court disagrees for the reasons stated below.

Defendants argue that dismissal is required by Code of Civil Procedure section 597. This section provides, in relevant part:

where the defense of another action pending or a demurrer based upon subdivision (c) of Section 430.10 is sustained (and no other special defense is sustained) an interlocutory judgment shall be entered in favor of the defendant pleading the same to the effect that no trial of other issues shall be had until the final determination of that other action, and the plaintiff may appeal from the interlocutory judgment in the same manner and within the same time as is now or may be hereafter provided by law for appeals from judgments.

(Code Civ. Proc. § 597 [emphasis added].) Defendants contend that, because section 597 requires entry of judgment, the Court should dismiss this action entirely. However, the plain language of section 597 mandates that the Court enter an interlocutory judgment only to the effect that no trial of any other issues shall be had until the final determination of the other pending action. This outcome is, in the Court’s view, substantively identical to the stay contemplated by the Court in its November 30, 2022 Minute Order. At a minimum, the statute manifestly does not call for (or permit) a dismissal of the action.

Defendants also argue that the cases cited by the Court and by Plaintiff do not comport with the rulings of the California Supreme Court. Defendant relies principally on Bauer v. Bauer, a 1927 opinion in which our Supreme Court affirmed the trial court’s order sustaining a demurrer without leave to amend where there was a second action already pending on the same facts in probate court. (Bauer v. Bauer (1927) 201 Cal. 267, 270.) Defendants mischaracterize this opinion as ruling on the issue of disposition of a plea in abatement, when, in truth, that issue was not before the court. The only issue upon which the Bauer court ruled was whether the probate court had exclusive jurisdiction over the matter because of the subject matter of the dispute. (Id. at 271.)

Defendants’ final argument is that a stay would be futile because “any conceivable claims” which Plaintiff might have against Defendants must be arbitrated, pursuant to the December 10, 2020 order compelling Plaintiff to arbitration in the prior case. Defendants’ conclusory assertion that there are no conceivable claims against Defendants that would be outside the scope of the arbitration agreement is insufficient to demonstrate why this case should be dismissed, in contravention of both statute and precedent.

Upon consideration of the relevant statutes and case law, the Court concludes that this matter should not be stayed pending resolution of the prior action, nor should it be dismissed. Rather, Defendant has demonstrated that the Court’s disposition of this matter should take the form of an interlocutory judgment under section 597 that no trial of any other issues shall be had until final determination of the prior action.

Conclusion

CONCLUSION:

Accordingly, Defendants’ Motion for Sanctions pursuant to Code of Civil Procedure section 128.7 is DENIED.

Defendants to give notice.

IT IS SO ORDERED.

Dated: March 7, 2023 ___________________________________

Theresa M. Traber

Judge of the Superior Court

Any party may submit on the tentative ruling by contacting the courtroom via email at Smcdept47@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.