Judge Upinder S. Kalra, Case 21STCV22977 2023-03-15 Tentative Ruling

1. Motion for Terminating Sanctions, striking Defendants’ Answer is GRANTED.

On June 21, 2021, Plaintiffs Jessica Davalos a/k/a Jessica Davalos-Ruiz and Alejandra Davalos a/k/a Alejandra Davalos-Ruiz filed a complaint against Defendants Maria Santos Davalos d/b/a La Barca de Jalisco Restaurant and La Barca Jalisco Restaurant, Eduardo Davalos, and Does 1 through 100. The complaint alleged ten causes of action: (1) Failure to Pay Applicable Minimum Wage, (2) Unpaid Overtime Wages, (3) Failure to Provide Meal Periods, (4) Failure to Provide Rest Periods, (5) Unreimbursed Business Expenses, (6) Failure to Furnish Complete and Accurate Wage Statements (7) Final Wages Not Timely Paid, (8) Breach of Contract, (9) Breach of Contract, and (10) Violation of California Unfair Business Competition Law. The Complaint alleges that the Plaintiffs worked for the Defendants at their restaurant. During their time there, the Plaintiffs did not receive proper wages for the hours worked, did not receive proper meal breaks and rest periods, and did not receive accurate wage statements.

On April 12, 2022, the Court continued the hearing to May 13, 2022 in order for the parties to meet and confer and for Defendant to comply.

On May 13, 2022, the Court granted all 12 motions to Compel, ordering Defendants to respond and produce documents within 15 days of entry of the order. Lastly, the Court awarded Plaintiffs $15,000 in monetary sanctions.

On September 26, 2022, Plaintiffs filed the current Motion for Terminating Sanctions. Defendants Opposition was filed December 8, 2022. Plaintiffs’ Reply was filed on December 14, 2022.

On December 21, 2022, the Court conducted a hearing on the motion. The Court noted that Defendant had yet to comply with the prior Court. The Court continued the motion in order to have Plaintiffs explain what sanctions short of terminating sanctions would provide relief to Plaintiff and to give Defendants additional time to comply with the prior Court orders.

On February 1, 2022, The Court advised the parties that Plaintiff had not filed a separate statement or concise outline as required by Rule of Court, rule 3.1345. The Court continued the motion in order to have Plaintiffs cure this procedural defect and, once again, to give Defendants additional time to comply with the prior Court orders.

On February 21, 2022, Plaintiffs filed a concise outline in compliance with Rule of Court, rule 3.1345.

Where a party willfully disobeys a discovery order, courts have discretion to impose terminating, issue, evidence, or monetary sanctions. (Code Civ. Proc., §§ 2023.010, subd. (g), 2025.450, subd. (h); R.S. Creative, Inc. v. Creative Cotton, Ltd. (1999) 75 Cal.App.4th 486, 495.) An evidence sanction prohibits a party that misused the discovery process from introducing evidence on certain designated matters into evidence. (Code Civ. Proc., § 2023.030, subd. (c).) Ultimate discovery sanctions are justified where there is a willful discovery order violation, a history of abuse, and evidence showing that less severe sanctions would not produce compliance with discovery rules. (Van Sickle v. Gilbert (2011) 196 Cal.App.4th 1495, 1516.) “[A] penalty as severe as dismissal or default is not authorized where noncompliance with discovery is caused by an inability to comply rather than willfulness or bad faith.” (Brown v. Sup. Ct. (1986) 180 Cal.App.3d 701, 707.) The court may impose a terminating sanction by one of the following orders:

(1) An order striking out the pleadings or parts of the pleadings of any party engaging in the misuse of the discovery process.

(2) An order staying further proceedings by that party until an order for discovery is obeyed.

1. The Court’s Minute Order, entered April 12, 2022, regarding Plaintiffs’ 12 discovery motions

The Court may take judicial notice of the existence of the records, but not the truth of matters asserted in such records. (Sosinsky v. Grant (1992) 6 Cal.App.4th 1548, 1565). As a result, although the court may take judicial notice that the documents exists, the Court may not take judicial notice of the truth of the facts in the documents.

Additionally, Evidence Code only allows the Court to take judicial notice of certain types of documents. The court may take judicial notice of “official acts of the legislative, executive, and judicial departments of the United States and of any state of the United States,” “[r]ecords of (1) any court of this state or (2) any court of record of the United States or of any state of the United States,” and “[f]acts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” (Evid. Code § 452, subds. (c), (d), and (h).) The Evidence Code does not allow the Court to take judicial notice of discovery responses or parts of cases, such as depositions.

Plaintiff’s request for judicial notice is GRANTED, pursuant to Evidence Code § 452(d).

Plaintiffs move for terminating sanctions against Defendants Maria Santos Davalos and Eduardo Davalos. Specifically, Plaintiffs request that the Court strike Defendant’s Answers and render judgment by default in favor of Plaintiffs. Alternatively, Plaintiffs request issue or evidence sanctions.

Plaintiffs argue that terminating sanctions are appropriate because Defendants have failed to produce court ordered discovery responses for more than four months, despite having received these requests in November 2021. On January 10, 2022, after providing extensions to Defendants without receiving any response, Plaintiffs filed 6 discovery motions each. The day before the hearing, Defendants served incomplete set of responses only to the RFAs, Set One, but did not provide any other responses of documents. The day of the hearing in April, the Court issued a Tentative ruling granting all 10 of the 12 motions and to require further responses without objection. The Court was not inclined to deem request for admissions deemed true. However, the Court continued the hearing to May 13, 2022, in order for the parties to meet and confer and for Defendant to comply. On May 11, 2022, Defendants served “solely amended responses to Plaintiffs’ Requests for Admissions, Sets One,” but did not provide any other responses to the RPDs or Interrogatories. On May 13, 2022, the Court granted the discovery motions and ordered responses within 15 days.

Plaintiffs argue that Defendants’ actions are subject to terminating sanctions because they have consistently failed to comply with discovery obligations as well as comply with this Court’s Order. (Motion 5:8-17.) Thus, because of this failure, Plaintiffs request that the Court strike the Answer, as trial is set for February, and Defendants have still not provided responses to the discovery requests. Alternatively, Plaintiffs request either issue or evidence sanctions.

Plaintiffs request that the Court order the following designated facts to be taken as true or Defendants are precluded from introducing any evidence to refute or oppose the following matters:

3. Defendants failed to pay Plaintiffs for their regular hours worked for Defendants

4. Defendants failed to pay Plaintiffs for their overtime hours worked for Defendants

5. Defendants failed to provide Plaintiffs meal periods on every workday they worked for Defendants

6. Defendants failed to provide Plaintiffs rest periods on every workday they worked for Defendants

7. Defendants failed to reimburse Plaintiffs for mileage, gas, and data usage on their personal cell phone that they incurred in the course and scope of their employment with Defendants

8. Defendants knowingly and intentionally failed to provide Plaintiffs with complete and accurate wage statements as required under California Labor Code section 226

9. Defendants failed to pay Plaintiffs all wages, earned and unpaid, upon their separation of employment

10. Defendants received a loan of at least $30,000 from plaintiff Jessica Davalos, and they failed to repay plaintiff Jessica Davalos any of it

11. Defendants received a loan of at least $30,000 from plaintiff Alejandra Davalos, and they failed to repay plaintiff Alejandra Davalos any of it

Defendants argue that terminating sanctions are inappropriate. Defendants’ counsel states that in February 2022, counsel’s email had been hacked and as of late May 2022 was using a different email address. After late May 2022, counsel did not receive any calls from Plaintiffs counsel or any copies of motions or court orders. Therefore, Defendants’ counsel was “unaware of any pending motions or subsequent court orders. However, on or about last week of October of 2022, during a case review, defense counsel reviewed the court’s website and learned of the discovery motions that were filed by the plaintiffs and the court’s subsequent orders.” (Opp. 2: 15-19.)

The trial court may order a terminating sanction for discovery abuse “after considering the totality of the circumstances: [the] conduct of the party to determine if the actions were willful; the detriment to the propounding party; and the number of formal and informal attempts to obtain the discovery.” (Los Defensores, Inc. v. Gomez (2014) 223 Cal.App..4th 377, 390.) Terminating sanctions are to be used sparingly.“[A] terminating sanction should generally not be imposed until the court has attempted less severe alternatives and found them to be unsuccessful and/or the record clearly shows lesser sanctions would be ineffective.” (Lopez v. Watchtower Bible & Tract Soc'y of N.Y., Inc. (2016) 246 Cal.App.4th 566, 604.) Code Civ. Proc. §2023.030, subd. (c) & (d) authorizes the Court to impose terminating or evidentiary sanction due to a party’s misuse of the discovery process. “A trial court must be cautious when imposing a terminating sanction because the sanction eliminates a party’s fundamental right to trial, thus implicating due process rights.” (Lopez v. Watchtower Bible and Tract Society of New York, Inc. (2016) 246 Cal. App. 4th 566, 604, review denied (July 27, 2016).) “A decision to order terminating sanctions should not be made lightly. But where a violation is willful, preceded by a history of abuse, and the evidence shows that less severe sanctions would not produce compliance with the discovery rules, the trial court is justified in imposing the ultimate sanction.” (Mileikowsky v. Tenet Healthsystem (2005) 128 Cal. App. 4th 262, 279–80, as modified on denial of reh'g (May 4, 2005).)

Here, the record demonstrates a willful, history of violations of twelve court orders. First, despite Defense counsel’s protestations that Defendants were unaware that there were any pending motions or court orders until October 2022 (Opposition, 12-8-22 Decl. Flores), the record reveals that Defendants had full knowledge of the Court orders. The Minute Order from April 12, 2022 indicates that counsel Aldo Flores appeared by video. The Court’s written tentative ruling was to grant the motion and impose monetary sanctions, but because the night before, some responses were served, the Court continued the hearing for one month in order to give Defendants time to serve code complaint responses of the November 2021 Discovery requests. Thereafter, Defendants served amended responses on May 11^th, two days before the May 13^th hearing. The May 13, 2022 minute order indicates that counsel Aldo Flores appeared telephonically. At this hearing, because complete, code complaint responses had not been served, this Court granted the 12 Motions to Compel, and ordered that responsive documents “must be produced no later than 15 days of the entry of this Order.” (Minute Order 5/13/2022, pg. 3.) Accordingly, defense counsel’s claim that counsel did not know there were valid discovery orders that had not been complied with until October 2022 is, at best, disingenuous, and at worst, a lie.[1] Second, in any event, certainly by December 8, 2022, when an opposition to this motion was filed, defense counsel has admitted to being fully aware of the extent of the discovery orders and the violations. Still, as of March 14, 2023, Defendants have yet to obey the Court’s May 13, 2022 discovery orders. Clearly, this history of continued violations of twelve valid court orders is willful.

Given the drastic nature of terminating sanctions, they should be treated as a measure of last resort: “[A] terminating sanction should generally not be imposed until the court has attempted less severe alternatives and found them to be unsuccessful and/or the record clearly shows lesser sanctions would be ineffective.” (Lopez v. Watchtower Bible & Tract Soc'y of N.Y., Inc. (2016) 246 Cal.App.4th 566, 604.) Here, the Court has tried less severe sanctions. First, the Court warned Defendants on April 12, 2022 of the impending 12 sanctions orders. One month later, when Defendants still had not provided the requested discovery, the Court entered its May 13, 2022 monetary sanctions award. One would think that a $15,000 monetary sanction would result in compliance. It has not. Second, on December 21, 2022, when defense counsel appeared at the first hearing on the motion for terminating sanctions, the Court again warned Defendants what was likely to occur if they continued to disobey the Court’s prior orders. To be clear, the Court explicitly communicated to Defendants that failure to comply with the twelve May 13, 2022 discovery orders would result in issue, evidentiary or terminating sanctions. The Court then continued the hearing, twice to give Defendants additional time to comply. In fact, one of the express purposes of the Court for continuing this hearing two times was an act of leniency, hoping to encourage compliance with the Court’s May 13, 2022 orders. Nonetheless, to date, Defendants have yet to comply. In sum, despite affording Defendants repeated second chances, Defendants have continued to disobey twelve valid discovery orders that were issued almost one year ago. Thus, the Court has exhausted its use of alternative, less drastic sanctions.

The Court is also mindful that terminating sanctions are not to punish the non-complying parties. “The trial court cannot impose sanctions for misuse of the discovery process as a punishment.” (Doppes v. Bentley Motors, Inc. (2009) 174 Cal. App. 4th 967, 992.) Rather, any given sanction must be “tailor[ed] to the harm caused by the withheld discovery.” (Do It Urself Moving & Storage, Inc. v. Brown, Leifer, Slatkin & Berns (1992) 7 Cal. App. 4th 27, 36 (superseded by statute on other grounds).) This is because “the purpose of discovery sanctions is not to provide a weapon for punishment, forfeiture and the avoidance of a trial on the merits, but to prevent abuse of the discovery process and correct the problem presented.” (Parker v. Wolters Kluwer U.S., Inc. (2007) 149 Cal. App. 4th 285, 301.) Accordingly, the Court has been reluctant to impose issue, evidentiary or terminating sanctions until the impact of the discovery violations could be evaluated. Now, after reviewing the concise outline filed by Plaintiff, the Court understands the extent of damage that Defendants non-compliance have caused Plaintiffs in preparing for their case in chief and defending against the alleged affirmative defenses. It is clear to this Court that Defendants failure to comply with their discovery obligations and the Court’s orders have left Plaintiffs with many discovery gaps that cannot be cured by evidence or issue sanctions. Twelve orders have been issued. Twelve orders have been disobeyed. On this record of willful, continuing and ongoing abuse of the discovery process, it appears to the Court that any sanction short of terminating sanctions would actually be rewarding Defendants.

The Court recognizes that that terminating sanctions are extreme. Still, discovery violations that are “willful, preceded by a history of abuse, and the evidence shows that less severe sanctions would not produce compliance with the discovery rules, the trial court is justified in imposing the ultimate sanction.” (Creed-21 v. City of Wildomar (2017) 18 Cal.App.5th 690, 702.) After reviewing the totality of the circumstances, the Court finds that Defendants’ conduct was willful, preceded by a history of abuse and less severe sanctions will not produce compliance with the twelve prior discovery orders. Accordingly, the Court will impose terminating sanctions and strike the Answers of Defendants and enter Default.

Motion for Terminating Sanctions are GRANTED. Defendants’ Answers are stricken and Default is entered.

[1] Moreover, counsel states that they started using a different email address in May 2022. Yet, a Notice of Change of Address or Other Contact Information was not filed until October 28, 2022, after the current motion for terminating sanctions had been filed for over a month.