TENTATIVE RULING – DEPT. P

APR. 15, 2014 CALENDAR No: 2

SC118217 — SILVER v. YOUR TRADING ROOM, et al.

PLAINTIFF’S MOTION TO COMPEL DEFENDANT NIKOLSON’S FURTHER RESPONSES TO WRITTEN DISCOVERY

The Court will grant the motion in part.

This is an action by an investor in a failed distributorship of a foreign exchange training and trading brokerage. In her FAC, Plaintiff essentially alleges that in or about May 2011, Defendants fraudulently induced her to invest in defendant Your Trading Room, LLC (“YTR, LLC”), in order to become a Master Regional Distributor in same. Plaintiff alleges that defendant Nikolson (one of only two defendants who are defending against the action, the remaining defendants having been defaulted or dismissed) was an officer, director, insider, and promoter of YTR, LLC (and related entities). She asserts claims against Nikolson for fraud in the inducement (4th c/a), negligent misrepresentation (6th c/a), and breach of fiduciary duty (10th c/a).

Plaintiff moves to compel Nikolson’s responses to a number of form and special interrogatories, requests for admissions, and inspection demands objected to by Nikolson.

Under CCP 2017.010, unless otherwise limited by court order, “any party may obtain discovery regarding any matter, not privileged, that is relevant to the subject matter involved in the pending action … if the matter either is itself admissible in evidence or appears reasonably calculated to lead to the discovery of admissible evidence.”

Nikolson reads the allegations against him in an unduly narrow manner. He also asserted innumerable boilerplate objections to valid discovery. On the other hand, Plaintiff’s new counsel has conceded that the motion is properly withdrawn as to numerous items. The Court disagrees with Plaintiff’s assertion that the “Group 3” form interrogatories, which fail to specifically define the term “INCIDENT,” are appropriately propounded.

Motion is granted in part.

Nikolson is ordered to serve full and complete, verified further responses to all form and special interrogatories listed and reproduced in the CRC 3.1020 separate statements filed in support of the motions, without objection and in full compliance with CCP 2030.210 – 2030.250, on or before April 15, 2014, with the exception of FROGs 2.11, 14.1, and 14.2, FROG 17.1 as it relates to RFAs 9 and 37, and SROGs 31-35.The further responses provided pursuant to this order are to be clearly captioned as “COURT-ORDERED FURTHER RESPONSES TO SPECIAL INTERROGATORIES” and “COURT-ORDERED FURTHER RESPONSES TO FORM INTERROGATORIES.”

On or before April 15, 2014, Nikolson is to serve Code-compliant, verified further responses to all inspection demands listed and reproduced in the CRC 3.1020 separate statement filed in support of the motion, in full compliance with CCP 2031.210 – 2031.250, and without objection save for those based upon the attorney-client or work- product privileges. Each response is to be self-contained. All responsive documents not already produced are to be produced concurrently. The further responses provided pursuant to this order are to be clearly captioned as “COURT-ORDERED FURTHER RESPONSES TO INSPECTION DEMANDS.” As to any document demanded as to which objection is made on the ground of attorney-client privilege and/or work-product doctrine, Nikolson is to concurrently serve a privilege log sufficiently specific for the reader to determine whether each withheld document is privileged. See, CCP 2031.240(c)(1); Wells Fargo Bank v. Superior Court (2000) 22 Cal.4th 201.

Nikolson is to serve verified further responses to all requests for admissions listed and reproduced in the CRC 3.1020 separate statement filed in support of the motion, without objection and in full compliance with CCP 2033.210 – 2033.240, on or before April 15, 2014, with the exception of RFAs 9 and 37. The further responses provided pursuant to this order are to be clearly captioned as “COURT-ORDERED FURTHER RESPONSES TO REQUESTS FOR ADMISSIONS.”

Nikolson and his former counsel, the firm of One, LLP, are sanctioned, jointly and severally, in the total amount of $3,060.00, to be paid by certified check at Plaintiff’s counsel’s office on or before April 25, 2014.

Should Nikolson fail to strictly comply with the discovery orders issued today, the Court will consider issuing evidentiary, issue, and/or monetary sanctions upon proper motion. Indeed, his counsel is reminded that the “graduated sanctions” approach to an award of terminating sanctions is not required where there is no indication that the imposition of lesser sanctions would compel compliance with discovery obligations. E.g., R.S. Creative, Inc. v. Creative Cotton, Ltd. (1999) 75 Cal.App.4th 486, 496.

OTHER MATTERS

This motion should not have been necessary. Although it is the Court’s function to resolve certain disputes between the parties, the Court expects counsel to do their utmost to resolve disputes such as that at bar in good faith before turning to the Court for resolution. In this regard, the Court — which is currently actively supervising over 500 unlimited civil cases, in addition to CEQA proceedings — anticipates that counsel are aware of the current strain on the resources and time of the Court and its staff in this unfortunate era of crippling budget cuts to the court system. Thus, the Court expects all counsel and their clients to comply with the discovery provisions of the Code without the need for Court intervention; intervention should be reserved for matters which good faith efforts cannot resolve, typically based on a good faith difference in the application of legal principles to a particular request.

Counsel are now ordered to comply with Local Rule 3.26 and Appendix 3A [formerly Rule 7.12], which by this order is now made mandatory in this action.