Judge: Thomas Falls, Case: 21PSCV00720, Date: 2022-09-15 Tentative Ruling

Case Number: 21PSCV00720    Hearing Date: September 15, 2022    Dept: R

Karpa Trading, Inc. v. Pacific Dining Group dba Kyoto Buffet & Grill, et al. (21PSCV00720)

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MOTION TO QUASH DEPOSITION SUBPOENAS SERVED ON NON-PARTY DEPONENTS FILED BY PACIFIC DINING GROUP, INC., XIANJIE JIANG AND LINGJIAN ZHAO

                        Responding Party: Plaintiff, Karpa Trading

Tentative Ruling

MOTION TO QUASH DEPOSITION SUBPOENAS SERVED ON NON-PARTY

DEPONENTS FILED BY PACIFIC DINING GROUP, INC., XIANJIE JIANG AND

LINGJIAN ZHAO is GRANTED, subject to the following modifications: (1) Kyoto Buffet will

be re-defined in the subpoenas to omit any reference to any employees, agents, accountants,

attorneys and any other representatives acting on its behalf and (2) the subpoenas shall be

limited to the time period from contract formation until the last communications between the

Parties for payment of the unpaid debt.[1]

Background

This is a contracts case. Plaintiff Karpa Trading, Inc. (“Plaintiff”) alleges the following against Defendants: Plaintiff is a seafood wholesaler importing and exporting seafood to restaurants. Plaintiff and Defendants have engaged in previous contracts. Defendants, however, have not paid for 13 invoices. In total, Kyoto has a past due balance of $48,083.25.[2]

On September 1, 2021, Plaintiff filed suit against Defendants for:

1. breach of contract;

2. breach of the implied covenant of good faith and fair dealing;

3. common count: goods and services rendered;

4. unjust enrichment

On December 1, 2021, Plaintiff filed its First Amended Complaint asserting the following causes of action:

1. breach of contract;

2. breach of the implied covenant of good faith and fair dealing;

3. common count: goods and services rendered;

4. unjust enrichment;

5. intentional misrepresentation;

6. negligent misrepresentation

On February 15, 2022, Defendants filed their Answer.

On April 26, 2022, Plaintiff filed a Motion for leave to file a Second Amended Complaint (“SAC”), which the court granted.

On April 28, 2022, Defendant Kyoto filed a Motion to Quash the Deposition Subpoena (Subpoena Duces Tecum) served by Plaintiff on American Continental Bank; Cathay Bank; 1688 Investment Inc; and Fuji Investment Group Inc. for consumer records pertaining to Kyoto Buffet Xianjie Jiang and Lingjian Zhao, defendants in this action.

            On August 31, 2022, Plaintiff filed its Opposition to the motion.

            On September 8, 2022, Defendant filed its Reply.

On June 13, 2022, Plaintiff filed its SAC adding 3 causes of action for: OPEN BOOK ACCOUNT, ACCOUNT STATED, and REASONABLE VALUE.

Legal Standard

A court may quash a subpoena entirely or partially, and issue an order to protect parties, witnesses or consumers from unreasonable or oppressive demands including violations of privacy.  (Code Civ. Proc., § 1987.1.)  The burden of proof is generally on the party seeking the quash order to show “good cause” for whatever order is sought.  (Fairmont Ins. Co. v. Superior Court (2000) 22 Cal.4th 245, 255 [for protective orders].) 

Discussion

The subpoenas at issue request the following information:

1. Any and all DOCUMENTS in YOUR possession or control pertaining to KYOTO BUFFET.

2. Any and all DOCUMENTS pertaining to bank statements in YOUR possession or control pertaining to KYOTO BUFFET from all current and closed checking accounts with YOUR banking institution.

3. Any and all DOCUMENTS pertaining to bank statements in YOUR possession or control pertaining to KYOTO BUFFET from all current and closed saving accounts with YOUR banking institution.

4. Any and all DOCUMENTS pertaining to bank statements in YOUR possession or control pertaining to KYOTO BUFFET from September 2019 to present including, but not limited to, wire transfers, copies of checks, and monthly account statements.

5. Any and all DOCUMENTS showing MONEY received by KYOTO BUFFET from September 2019 to present.

Kyoto Buffet advances four arguments as to why the subpoenas on the four banking institutions should be quash: 

-          Subpoenas are overly broad,

-          Subpoenas seek irrelevant information,

-          The requests are invasive of the privacy rights of the defendants and others, and

-          The service of the subpoenas are defective.

(Notice of Motion p. ii.)

Whether the Information is Relevant and Overbroad

Kyoto Buffet concedes that the financial transactions between Plaintiff and Kyoto Buffet during this period of time are relevant. However, seeking any and all records without limitation to time and scope does not make sense because the information bear no nexus with the alleged transactions from January 4, 2020 to March 14, 2020.

Here, the court agrees that seeking bank records outside of the time periods of the transactions is irrelevant. For example, a transaction from Kyoto Bank dated to 2010 purchase is not relevant to the nature of the allegations. Nor is a transaction between Kyoto Bank and a third party at any time relevant to the nature of the allegations as the allegations are merely limited to an unpaid debt by Kyoto Buffet.

To the extent that Plaintiff argues the information is not overly broad because Kyoto Buffet has only been incorporated for four years or that certain Subpoena Requests are limited in time from September 2019 to present, that still does not address the issue of why financial information from the inception of the corporation or information before the parties even entered into their agreement is relevant when the allegations are confined to January 2020-March 2020/April 2020.

To the extent that Plaintiff argues it needs information from third parties that “[s]uch limitation would unreasonably restrict Plaintiff’s ability to discover defendant Kyoto’s financial condition and could not know whether its financial hardship claims were in fact true,” (Opp. p. 8), the allegations are not predicated upon any such refusal to pay. Nor does Defendant’s answer assert the inability to pay as a defense. Therefore, such information is irrelevant.

Therefore, the court agrees that the subpoenas are overly broad and irrelevant and require modification.

Defective Service and Privacy Rights

According to Kyoto Buffet, no notice was provided to Jiang or Zhao. However, that is not so

because CCP section 1985.3 subdivision (b)(1) allows for service on “his or her attorney of

record,” which the service list substantiates.

In opposition, Plaintiff states essentially argues notice is irrelevant as the subpoenas do not  seek the individuals’ financial records. (Opp. pp. 12-13 [“None of the requests asks Jiang or Zhao’s personal records there is no reason as to why Jiang or Zhao’s personal financial records will be disclosed under the Subpoena when they were issued.”].)

Plaintiff, however, narrowly interprets its own subpoena requests.

As defined in the subpoenas, Kyoto Buffet shall mean “its employees, agents, accountants,

attorneys and any other representatives acting on its behalf.” The subpoenas thus are requesting

bank records of Jiang (the Chief Executive Officer and director of Kyoto Buffet) and Zhao (its

Chief Financial Officer and agent for service of process).

As such, to the extent that Plaintiff states that the “subpoenas specifically seek for Kyoto’s bank records,

not the individual defendants’ information, the subpoenas indicate

otherwise. Based thereon, the court need not engage in a privacy analysis.

Therefore, the requests are to be modified to change the definition of Kyoto Buffet to

exclude any mention of “employees, agents, accountants, attorneys and any other representatives