Case Name: Platinum Roofing, Inc. v. Stephenson
Case No.: 18CV336768

On January 29, 2018, respondent Michael Stephenson (“Respondent”) filed a claim with the Labor Commissioner’s Office for unpaid commissions and waiting time penalties. On August 28, 2018, a hearing was held at the San Jose Office of the Labor Commissioner, and the Commissioner ordered that appellant Platinum Roofing, Inc. (“Appellant”) pay Respondent $50,982.89 as unpaid commissions, $23,275.20 as a waiting time penalty and $3,464.04 as interest. On October 25, 2018, Appellant filed a notice of appeal of the Labor Commissioner’s order, and requested a trial de novo. On March 26, 2019, Respondent propounded discovery requests, including request for production of documents (“RPDs”) numbers 72-76, requests for admissions (“RFAs”) numbers 72-76, and form interrogatory (“FI”) number 17.1 (collectively, “discovery requests”). On April 4, 2019, Respondent also noticed a PMK deposition of Appellant. On April 30, 2019, Appellant provided responses to the discovery requests consisting of objections and a statement stating that, based on its objections, it would not provide any substantive response. Appellant also responded that the person who was designated as the PMK was on an extended leave of absence, and that it was diligently working on a new PMK but the person was recently hired, and also asserted that Respondent lacked authority to conduct discovery. Respondent moves to compel further responses to the discovery requests, and to compel attendance of Appellant’s PMK for deposition. Trial is set for July 15, 2019. Appellant filed an opposition to the motion on May 16, 2019. Appellant also filed a second opposition on May 24, 2019.

Motion to compel further responses to discovery requests and to compel attendance at deposition

Appellant argues that Respondent is not entitled to conduct discovery, and that the Court should not permit Respondent to conduct discovery. Appellant relies on Sales Dimensions v. Super. Ct. (Whelan) (1979) 90 Cal.App.3d 757, in which the court stated that “the question whether discovery should be allowed in a proceeding under Labor Code section 98.2 is best left to the discretion of the superior court hearing the appeal.” (Id. at p.763.) Appellant also argues that the deposition notice for a PMK for Appellant is harassing and unduly burdensome considering that the person responsive to the PMK notice of deposition already testified at the hearing before the Labor Commissioner and is currently on an extended medical leave without an expected return date. Appellant also argues that the discovery requests are overbroad and lack relevance.

As to Appellant’s first argument regarding the exercise of discretion to allow discovery, Appellant argues that “the amount in controversy is less than $10,000” because it “made him a settlement offer pursuant to CCP §998 which was within $10,000 of the Labor Commissioner’s Award.” This argument is perplexing. Appellant has sought a trial de novo. As the Sales Dimensions court stated, “[s]ince the superior court may hear testimony, including any new evidence, the findings of the Labor Commissioner are entitled to no weight whatsoever, and the proceedings are truly ‘a trial anew in the fullest sense.’” (Sales Dimensions, supra, 90 Cal.App.3d at p.763.) It is unclear as to whether Appellant is attempting to concede that it owes Respondent $70,000 such that the difference between the amount it is willing to pay and the amount awarded by the Labor Commissioner to Respondent is less than $10,000; however, in determining a “true amount in controversy,” the Court does not rely on the Labor Commissioner’s award, including the amount. The amount in controversy is in excess of $80,000. “[W]here the amount in dispute is large… discovery may be appropriate.” (Id.) Here, the Court exercises its discretion to allow discovery in this proceeding.

As to the PMK deposition, Respondent is entitled to depose a PMK for Appellant. (See Code Civ. Proc. § 2025. 230 (stating that “the deponent shall designate and produce at the deposition those of its officers, directors, managing agents, employees, or agents who are most qualified to testify on its behalf as to those matters to the extent of any information known or reasonably available to the deponent”).) Although the topics may have been covered at the hearing before the Labor Commissioner, as stated by the Sales Dimensions court, “[n]either party is limited to the evidence presented at the administrative hearing and may introduce any relevant evidence.” (Sales Dimensions, supra, 90 Cal.App.3d at p.762.) From its opposition, it appears that Appellant plans to provide a different person for its PMK deposition. It is quite possible, then, that the deposition testimony is not duplicative. Regardless, Appellant has not demonstrated that a PMK deposition is unreasonably cumulative or duplicative, and does not establish that the PMK deposition is either harassing or unduly burdensome. These objections are OVERRULED.

Lastly, Appellant asserts that the discovery requests are overbroad and seek information that is not relevant. Appellant does not seek to justify any of its other objections. (See Kirkland v. Super. Ct. (Guess?, Inc.) (2002) 95 Cal.App.4th 92, 98 (stating that the objecting party has the burden to justify his or her objections).) As to the asserted objections, the permissible scope of discovery is broad. Discovery is generally allowed for any non-privileged matters that are relevant to the subject matter involved in the action “if the matter either is itself admissible in evidence or appears reasonably calculated to lead to the discovery of admissible evidence.” (Code Civ. Proc., § 2017.010.) Information is relevant to the subject matter of an action if it might reasonably assist a party in evaluating the case, preparing for trial, or facilitating settlement. (Gonzalez v. Superior Court (1995) 33 Cal.App.4th 1539, 1546; see also Lipton v. Super. Ct. (Lawyers’ Mutual Ins. Co.) (1996) 48 Cal.App.4th 1599, 1611-1612 (stating that “information is relevant if it ‘might reasonably assist a party in evaluating the case, preparing for trial, or facilitating settlement’… [a]dmissibility is not the test and information, unless privileged, is discoverable if it might reasonably lead to admissible evidence… the scope of discovery extends to any information that reasonably might lead to other evidence that would be admissible at trial”); see also Stewart v. Colonial Western Agency, Inc. (2001) 87 Cal.App.4th 1006, 1013 (stating same and also noting that “[t]hese rules are applied liberally in favor of discovery”); see also Glenfed Development Corp. v. Super. Ct. (Natl. Union Fire Ins. Co. of Pittsburgh, PA) (1997) 53 Cal.App.4th 1113, 1117 (stating same).) Respondent’s discovery requests seek relevant information, and Respondent has demonstrated good cause for the discovery requests. (See Code Civ. Proc. § 2031.310, subd.(b)(1); see also Kirkland, supra, 95 Cal.App.4th at p.98 (stating that “the party who seeks to compel production has met his burden of showing good cause simply by a fact-specific showing of relevance… [o]nce good cause was shown, the burden shifted to [the opposing party] to justify his objection”); see also TBG Ins. Services Corp. v. Super. Ct. (Zieminski) (2002) 96 Cal.App.4th 443, 448. (stating that “[i]n the more specific context of a demand for production of a tangible thing, the party who asks the trial court to compel production must show ‘good cause’ for the request-but unless there is a legitimate privilege issue or claim of attorney work product, that burden is met simply by a fact-specific showing of relevance”).) Appellant has not justified its objections. Appellant’s objections to the discovery requests are OVERRULED.

Respondent’s motion to compel further responses to discovery is GRANTED in its entirety. Appellant shall provide verified, code-compliant responses without objections within 20 calendar days of service of this signed Order. Respondent’s motion to compel attendance of a PMK for Appellant is GRANTED. Parties shall meet and confer and conduct a deposition of Appellant’s PMK within 30 calendar days. If the parties cannot agree on a date, the court may select one on request.

Requests for monetary sanctions

In its first opposition to the motion, Appellant did not request monetary sanctions. In its second opposition, Appellant requested monetary sanctions in the amount of $3,157.50. As Appellant did not substantially prevail in opposing the motion, Appellant’s request for monetary sanctions is DENIED.

In connection with his motion, Respondent requests monetary sanctions in the amount of $5,395.00. However, of that amount, $2,075 is for anticipated fees. The Court does not award monetary sanctions for anticipated fees. The Court also deems that the amount is excessive considering the complexity of the issues that are the subject of the instant motion. Respondent’s request for monetary sanctions is GRANTED in part and DENIED in part in the amount of $2000.00. Appellant Platinum shall pay counsel for Respondent $2,000.00 within 10 calendar days of service of this signed Order.

The Court will prepare the order.