San José Auto Outlet Plus Trucks, Inc. v. Shabvani CASE NO. 19CV346262
DATE: 11 February 2020 TIME: 9:00 am LINE NUMBER: 5
This matter will be heard by the Honorable Judge Socrates Peter Manoukian in Department 20 in the Old Courthouse, 2nd Floor, 161 North First Street, San Jose. Any party opposing the tentative ruling must call Department 20 at 408.808.6856 and the opposing party no later than 4:00 PM on 10 February 2020. Please specify the issue to be contested when calling the Court and Counsel.

ORDER ON MOTION OF PLAINTIFF TO COMPEL DEFENDANT SHABVANI TO

PROVIDE FURTHER RESPONSES TO REQUESTS FOR ADMISSIONS AND FORM INTERROGATORIES

I. Factual and Procedural Background.

Plaintiff San Jose Auto Outlet Plus Trucks, Inc. (“Plaintiff”) is in the business of selling used automobiles and trucks to the public. (First Amended Complaint (“FAC”), ¶2.) From approximately 2003 to 1 January 2018, defendant Fayyaz Shabvani (“Defendant”) was an employee an agent of Plaintiff. (FAC, ¶6.) Defendant was the General Manager of Plaintiff from approximately 2005 to 1 October 2016. (Id.) In his capacity as General Manager of Plaintiff, Defendant had control of Plaintiff’s records. (FAC, ¶7.)

Defendant was in charge of collecting cash and down payments from people who purchased cars and employees who received cash from the purchases. (FAC, ¶8.) Plaintiff had a policy that any cash an employee received from the sale of an automobile had to be immediately deposited into the onsite safe. (FAC, ¶9.) Defendant would refuse to put money into the safe and would keep the money on his person and even take the money home. (Id.)

Defendant used his status as General Manager to manipulate the financial records of Plaintiff to his advantage, and to disguise such manipulations to Plaintiff’s detriment by engaging in various scams to divert money belonging to Plaintiff to himself. (FAC, ¶¶10 – 11.) Among other things, Defendant would sell a vehicle at a loss or for little profit to Plaintiff, in exchange for a secret cash payment from the customer to Defendant. (FAC, ¶16.)

Plaintiff did not discover and did not have reason to discover Defendant’s misconduct because Defendant controlled the financial books to hide his fraudulent conduct. (FAC, ¶18.) In September 2016, an employee of Plaintiff first informed Khosrow Onbirback (“Onbirback”), Plaintiff’s president, that Defendant may be stealing. (Id.)

On 19 April 2019, Plaintiff filed a complaint against Defendant.

On 1 July 2019, Plaintiff filed the operative FAC which asserts the following causes of action:

(1) Breach of Fiduciary Duty
(2)
(3) Breach of the Implied Covenant of Good Faith and Fair Dealing
(4)
(5) Restitution
(6)
(7) Violation of Penal Code Section 496(a)
(8)
(9) Fraud by Concealment
(10)
(11) Common Count
(12)
(13) Bus. & Prof. Code Sec. 17200
(14)
(15) For a Constructive Trust
(16)
On 2 August 2019, Defendant filed an answer to Plaintiff’s FAC

II. Discovery Dispute.

On an unspecified date , Plaintiff served Defendant with a Request for Admissions (“RFA”), set one, and Form Interrogatories, set one.

On an unspecified date , Defendant served Plaintiff responses to RFA and FI, set one.

On 20 September 2019, Plaintiff’s counsel emailed Defendant’s counsel in an effort to meet and confer with regard to, among other discovery, Defendant’s response to FI numbers 2.8 and 12.3 and RFA numbers 3 – 23.

On 2 – 3 October 2019, Defendant’s counsel requested additional time to respond to Plaintiff’s meet and confer letter and/or provide supplemental responses, offering to extend the deadline for Plaintiff to bring a motion to compel.

On 16 October 2019, Defendant’s counsel responded to Plaintiff’s counsel’s meet and confer letter. Also on 16 October 2019, Defendant’s counsel provided Plaintiff with a supplemental responses to FI.

On 13 November 2019, Plaintiff filed the motion now before the court, a motion to compel Defendant’s further response to FI, number 2.8, and RFA, numbers 4 – 23.

III. Plaintiff’s motion to compel Defendant’s further response to RFA is DENIED.

“On receipt of a response to requests for admissions, the party requesting admissions may move for an order compelling a further response if that party deems that either or both of the following apply: (1) An answer to a particular request is evasive or incomplete. (2) An objection to a particular request is without merit or too general.” (Code Civ. Proc., §2033.290, subd. (a).)

When discovery responses are served after a motion to compel is filed, the court has substantial discretion in deciding how to rule in light of the particular circumstances presented. (See Sinaiko Healthcare Consulting, Inc. v. Pacific Healthcare Consultants (2007) 148 Cal.App.4th 390, 408-409 (Sinaiko).) Through this discretion, the court might deny the motion to compel as moot and just impose sanctions, or examine the responses to determine if they are code-compliant. (Sinaiko, supra, 148 Cal.App.4th at p. 409.)

On 27 January 2020, Defendant served Plaintiff with supplemental responses to RFA. In view of Defendant’s service of a supplemental response, the court deems the motion to compel further responses to RFA to be MOOT and is, for that reason, DENIED.

IV. Plaintiff’s motion to compel Defendant’s further response to FI is DENIED without prejudice.

Code of Civil Procedure section 2030.300, subdivision (a) states, in relevant part: “On receipt of a response to interrogatories, the propounding party may move for an order compelling a further response if the propounding party deems that any of the following apply: (1) An answer to a particular interrogatory is evasive or incomplete.(2) An exercise of the option to produce documents under Section 2030.230 is unwarranted or the required specification of those documents is inadequate.(3) An objection to an interrogatory is without merit or too general.”

A motion to compel further response to interrogatories “shall be accompanied by a meet and confer declaration under Section 2016.040.” (Code Civ. Proc., §2030.300, subd. (b).) “A meet and confer declaration in support of a motion shall state facts showing a reasonable and good faith attempt at an informal resolution of each issue presented by the motion.” (Code Civ. Proc., §2016.040.) A reasonable and good faith attempt at informal resolution requires that the parties present the merits of their respective positions with candor, specificity, and support. (Townsend v. Super. Ct. (1998) 61 Cal.App.4th 1431, 1435, 1439.) The level of effort at informal resolution which satisfies the “reasonable and good faith attempt” standard depends upon the circumstances of the case. (Obregon v. Super. Ct. (1998) 67 Cal.App.4th 424, 431.)

As indicated above, Plaintiff acknowledges receipt of a supplemental response to FI on 16 October 2019. However, following receipt of this supplemental response, there is no further effort to meet and confer with regard to the adequacy of the supplemental response. The court will note that Defendant’s counsel’s meet and confer letter of 16 October 2019 expressly invites Plaintiff’s counsel to meet and confer, “[i]f you further disagree with our position below.” In addition to the statutory obligation to meet and confer, Santa Clara County Bar Association Code of Professionalism , Section 9, states, in relevant part, “A lawyer should engage in a meaningful and good faith effort to resolve discovery disputes and should only bring discovery issues to the court for resolution after these efforts have been unsuccessful.” In this circumstance, the court finds Plaintiff’s counsel has not fulfilled his obligation to meet and confer in good faith.

Accordingly, Plaintiff’s motion to compel Defendant’s further response to FI, number 2.8, is DENIED without prejudice. The parties are ordered to meet and confer on this issue. In the event the parties are unable to reach an informal resolution, Plaintiff may thereafter file a motion to compel. “Motions should be filed or opposed only in good faith and when the issue cannot be otherwise resolved.” (Santa Clara County Bar Association Code of Professionalism, Section 10.)

V. Sanctions

On the issue of sanctions, Code of Civil Procedure section 2033.290, subdivision (d) mandates an award of monetary sanctions “against any party, person, or attorney who unsuccessfully makes or opposes a motion to compel further response, unless it finds that the one subject to the sanction acted with substantial justification or that other circumstances make the imposition of the sanction unjust.”

Code of Civil Procedure section 2030.300, subdivision (d) mandates an award of monetary sanctions “against any party, person, or attorney who unsuccessfully makes or opposes a motion to compel a further response to interrogatories, unless it finds that the one subject to the sanction acted with substantial justification or that other circumstances make the imposition of the sanction unjust.”

“The court may award sanctions under the Discovery Act in favor of a party who files a motion to compel discovery, even though no opposition to the motion was filed, or opposition to the motion was withdrawn, or the requested discovery was provided to the moving party after the motion was filed.” (Cal. Rules of Court, rule 3.1348, subd. (a).)

Both parties request the court impose sanctions against the other. Here, however, the court declines to award sanctions. Neither side is entirely innocent. The court expects the parties and their counsel to engage in more meaningful efforts at informal resolution.

_______________¬¬¬____________

DATED: ______________________¬¬¬________________________

HON. SOCRATES PETER MANOUKIAN

Judge of the Superior Court

County of Santa Clara