Case Number: 19PSCV00181 Hearing Date: February 21, 2020 Dept: J

HEARING DATE: Friday, February 21, 2020

NOTICE: OK

RE: He v. Chen, et al. (19PSCV00181)

______________________________________________________________________________

Plaintiff’s MOTIONS (1) TO COMPEL FURTHER RESPONSES TO SPECIAL INTERROGATORIES, SET ONE; (2) TO COMPEL FURTHER RESPONSES TO REQUEST FOR PRODUCTION OF DOCUMENTS, SET ONE; (3) FOR RELEASE OF DOCUMENTS PURSUANT TO SUBPOENA DUCES TECUM.

Responding Party: Defendant/Cross-Complainant, Jay Min Chen

Tentative Ruling

(1) The motion to compel further responses to special interrogatories is GRANTED. Defendant is ordered to serve verified further responses to Special Interrogatory Nos. 4 through 9, inclusive, within 20 days of this order. Plaintiff’s request for monetary sanctions is GRANTED in the amount of $960.00 against Defendant Jay Min Chen and his counsel of record, jointly and severally, to be paid within 30 days of this order.

(2) The motion to compel further responses to request for production of documents is GRANTED as to Request for Production of Documents Nos. 1-4, 11-16, 18, 20-42, and 44, and DENIED as to Request for Production of Documents Nos. 5-10, 17, 19, 43, 45-55. Defendant is ordered to serve verified further responses to Request for Production of Documents Nos. 1, 3, 4, 11-16, 18, 20-42, and 44, inclusive, as stated herein, within 20 days of this order. Plaintiff’s request for monetary sanctions is GRANTED in the amount of $1,410 against Defendant Jay Min Chen, to be paid within 30 days of this order.

(3) At the request of the moving party, the motion for compliance with the subpoena duces tecum is CONTINUED to March ___________.

Plaintiff is ordered to give proper notice regarding each motion.

Background

On February 20, 2019, Plaintiff Carrien Qian He (“Plaintiff” or “He”) filed a complaint against Defendants Jay Min Chen (“Chen”), Hiu Kwong Hung a/k/a William Hiu Kwong Hung a/k/a William Kwong Hung (“Hung”), and XTR LLC (“XTR”). Plaintiff alleges that on October 11, 2016, Chen and Hung told He that: (a) He, Chen, and Hung would jointly open, own, and operate a Golden Corral restaurant in which He would own 50%, Chen would own 42%, and Hung would own 8%; and (b) they split the profits of the restaurant, proportionally to their respective ownership percentages. Pursuant to their conversations, Chen, He, and Hung entered into the Golden Corral Franchise Agreement, wherein Golden Corral Franchising System, Inc. granted He, Chen, and Hung, as franchisees, the right and franchise to operate a Golden Corral restaurant. Also, on October 13, 2016, the franchisees incorporated Golden Globalinks Corp. (“Globalinks”) for the purpose of operating the Restaurant, with He owning 50% of Globalinks, Chen owning 42% of Globalinks, and Hung owning 8% of Globalinks, with the agreement that the parties would split the profits of Globalinks, pursuant to their respective ownership percentages. Plaintiff alleges that since October 2016, Defendants have conspired and engaged in a calculated and long running scheme and trick to intentionally defraud He and Globalinks – and conceal from He and Globalinks – Defendant’s illicit and unauthorized embezzlement, stealing, skimming, misappropriating, converting, pilfering, and siphoning off of (a) Globalinks’ funds and cash, (b) funds in Globalinks’ bank accounts, (c) cash in Globalinks’ safe, (d) the funds from the Small Business Administration Loan from United Pacific Bank, (e) money from customers at the Restaurant, (f) Globalinks’ income, and (g) kickbacks, inducements, and contributions from third-parties, through various schemes – as described below – all of which was for Defendants’ own personal enrichment and to the detriment of He and Globalinks.

Plaintiff alleges the following causes of action against Defendants: (1) conversion; (2) unauthorized transfer of corporate assets; (3) breach of fiduciary duty; (4) embezzlement; (5) fraud and concealment; (6) negligent misrepresentation and concealment; (6) negligent misrepresentation and concealment; (7) unjust enrichment; (8) removal of director (Corporations Code Section 304); (9) accounting; (10) declaratory relief; and (11) violation of Business & Profession Code Sections 17200, et seq.

On March 27, Defendant/Cross Complainant Chen filed a cross-complaint against Globalinks and He. The operative First Amended Cross-Complaint was filed on April 15, 2019, in which Chen alleges the following causes of action: (1) involuntary dissolution; and (2) battery.

(1) PLAINTIFF’S MOTION TO COMPEL FURTHER RESPONSES TO SPECIAL INTERROGATORIES, SET ONE

Legal Standard

Discovery motions to compel further responses must be served within 45 days after service of the responses in question (extended if served by mail, overnight delivery, or fax). (Code Civ. Proc. §§ 2030.300, 2031.310, 2033.290, 1013.) Otherwise, the demanding party waives the right to compel any further responses. (Id., §§ 2030.300, subd. (c), 2031.310, subd. (c), 2033.290, subd. (c), 2016.050; see Sperber v. Robinson (1994) 26 Cal.App.4th 736, 745.) The 45-day limit is mandatory and jurisdictional. (Sexton v. Superior Court (1997) 58 Cal.App.4th 1403, 1410.) However, the parties can also agree in writing on a specific later date by which to file the motion to compel. (Code Civ. Proc. §§ 2030.300, subd. (c), 2033.290, subd. (c).)

Code of Civil Procedure section 2030.300 provides, in pertinent part, as follows:

(a) 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.

(b) A motion under subdivision (a) shall be accompanied by a meet and confer declaration under Section 2016.040. . . .

Discussion

Plaintiff moves for an order compelling Defendant Jay Min Chen (“Defendant”) to provide further responses to Special Interrogatories, Set One, numbers four through nine, inclusive.

Special Interrogatory No. 4

Special Interrogatory number four asks Defendant to identify any and all tourist companies Defendant spoke with regarding dining at the Golden Corral restaurant at issue in this lawsuit. Defendant responded to this interrogatory by objecting on the grounds that the term “tourist companies” is vague and ambiguous.

Plaintiff argues the issue concerning tourist companies is pervasive in this litigation and that Defendant’s objections are made in bad faith. It is alleged in the complaint that since the opening of the Golden Corral restaurant until present, Defendant, without authorization, made direct arrangements with various tourist companies to allow tourists to eat meals at the restaurant in exchange for direct payment to Defendant, which Defendant then pocketed for his own benefit. (Compl., ¶ 36.) Plaintiff further contends that Defendant produced a document in discovery evidencing his conversation regarding the “tourist companies,” and that Defendant therefore has knowledge of term “tourist companies.”

The court finds that in light of the allegations in this action, as well as the nature of the allegations which are reasonably in the knowledge of Defendant, the request is neither vague nor ambiguous. The nature of the information sought is apparent and is sufficient to allow Defendant to respond.

Accordingly, the motion is GRANTED as to Special Interrogatory number four.

Special Interrogatory No. 5

Special Interrogatory number five asks Defendant to identify any and all “cleaning service companies” to which Defendant made payments for their services at the Golden Corral restaurant.

Defendant responded by stating:

Responding party is an individual who did not make payments to any RESTAURANT contractor. Further, Responding Party cannot answer this interrogatory at the present time of being pleaded with particularity in that plaintiff has refused to comply with a director’s demand for inspection pursuant to Corporations Code sec. 1602 and has refused to turn over company books and records for inspection. Said demand was made prior to the onset of litigation.

The court finds Defendant’s response to be incomplete and invasive. A responding party is under a duty to provide responses that are “as complete and straightforward as the information reasonably available to the responding party permits.” (Code Civ. Proc. § 2030.220, subd. (a).) “If an interrogatory cannot be answered completely, it shall be answered to the extent possible.” (Code Civ. Proc. § 2030.220, subd. (b).) Here, the request does not ask whether responding party made payments to any restaurant contractor. The request plainly asks Defendant to identify any cleaning service companies to which he made any payments for services at the subject Golden Corral restaurant. If Defendant did not make any payments, he should unambiguously state so in his verified responses.

Furthermore, “[i]f the responding party does not have personal knowledge sufficient to respond fully to an interrogatory, that party shall so state, but shall make a reasonable and good faith effort to obtain the information by inquiry to other natural persons or organizations, except where the information is equally available to the propounding party.” (Code Civ. Proc. § 2030.220, subd. (c).) Defendant does not state to having made a reasonable and good faith effort to obtain the requested information, which is reasonably within his own knowledge.

Accordingly, the motion is GRANTED as to Special Interrogatory number 5.

Special Interrogatory Nos. 6 and 7

Special Interrogatory number six asks Defendant to identify any and all banking institutions he has had accounts with since 2016, and Special Interrogatory number seven asks Defendant to identify any and all banking institutions JC Globalinks has had accounts with since 2016. According to the moving and opposition papers, JC Globalinks appears to be Defendant’s separately held corporation.

Defendant objects on the grounds that the interrogatories are overbroad in scope, invasive of Defendant’s right of privacy, and prematurely requests for financial information relevant only to punitive damages.

The framework for evaluating invasions of privacy in discovery has been clarified in Williams v. Superior Court (2017) 3 Cal.5th 531. There, the California Supreme Court held that, generally, “[t]he party asserting a privacy right must establish a legally protected privacy interest, an objectively reasonable expectation of privacy in the given circumstances, and a threatened intrusion that is serious. The party seeking information may raise in response whatever legitimate and important countervailing interests disclosure serves, while the party seeking protection may identify feasible alternatives that serve the same interests or protective measures that would diminish the loss of privacy. A court must then balance these competing considerations.” (Williams v. Superior Court (2017) 3 Cal.5th 531, 553, citing Hill v. National Collegiate Athletic Assn. (1994) 7 Cal.4th 1, 35.) The court rejected the cases which held that the party seeking protected information must always show a compelling need or interest. (Id. at 557.) Instead, the Court held, “[o]nly obvious invasions of interest fundamental to personal autonomy must be supported by a compelling interest.” (Id.)

Here, Defendant argues “[t]here is no reason that [Defendant] has to provide this highly personal and sensitive personal bank account information,” and that Plaintiff’s claims that company funds were usurped or improperly withdrawn “would be evidence within the company’s books and bank accounts that Plaintiff is in control of and which Plaintiff has blocked [Defendant] form accessing in any manner.” (Opp., 2:17-22.) Personal financial information comes within the zone of privacy protected by article 1, section 1 of the California Constitution. (Moskowitz v. Superior Court (1982) 137 Cal.App.3d 313, 315 (disapproved on other grounds in Williams, supra, 3 Cal.5th 531, 557, n.8).) However, the court notes that Plaintiff alleges that Defendant engaged in several schemes dealing with corporate funds involving his personal bank accounts and credit cards. (See Compl., ¶¶ 30, 36, 45.) Furthermore, Defendant does not carry his burden in establishing that requiring the identification of the banking institutions in which he and his corporation retained bank accounts since 2016 is a “serious” threatened intrusion of privacy to require an outright bar to its discovery. (See Williams, supra, 3 Cal.5th at 555, 559.)

Accordingly, the motion is GRANTED as to Special Interrogatory numbers 6 and 7.

Special Interrogatory Nos. 8 and 9

Special Interrogatory number 8 asks Defendant if he made William Hung a director of the corporation without first discussing it with Plaintiff.

Defendant responded:

Pursuant to Code of Civil Procedure§ 2030.230, the answer to this interrogatory would necessitate the preparation or the making of a compilation, abstract, audit, or summary of or from the documents of the party to whom the interrogatory is directed, and the burden or expense of preparing or making it would be substantially the same for the party propounding the interrogator as for the responding party, also see documents produced in response to document demands specifically Minutes of first organization meeting of the board of directors October 13, 2016 identifying He as temporary chairman and temporary secretary with no mention of chief financial officer and also identifying Hung as director.

Special Interrogatory number nine asks Defendant to identify when he discussed with Plaintiff making William Hung a director of the corporation.

Defendant responded:

Responding Party spoke to Propounding Party many times verbally or through text message.

First, Defendant did not attempt to justify his objections raised in his response to Special Interrogatory number eight. (See Fairmont Ins. Co. v. Superior Court (2000) 22 Cal.4th 245, 255 (stating the default rule that the party objecting to discovery bears the burden of justifying the objections).) Second, Defendant fails to fully answer the interrogatories as requested. A responding party is under a duty to provide responses that are “as complete and straightforward as the information reasonably available to the responding party permits.” (Code Civ. Proc. § 2030.220, subd. (a).) “If an interrogatory cannot be answered completely, it shall be answered to the extent possible.” (Code Civ. Proc. § 2030.220, subd. (b).) If Defendant did not make William Hung director of the corporation without first discussing it with Plaintiff, Defendant should state so in his verified responses. Additionally, Defendant’s response that he “spoke to [Plaintiff] many times verbally or through text message” does not respond to the straightforward request for Defendant to identify when he discussed with Plaintiff making William Hung a director of the corporation.

Accordingly, the motion is GRANTED as to Special Interrogatories 8 and 9.

Monetary Sanctions

“The court shall impose a monetary sanction under Chapter 7 (commencing with Section 2023.010) 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.” (Code Civ. Proc. § 2030.300, subd. (d).) Plaintiff seeks monetary sanctions in the amount of $2,737.50 for a total time of 12.6 hours expended by Plaintiff’s counsel in connection with this motion, at counsel’s billed rate of $225.00 per hour, plus the $60 filing fee. (Yabko Decl., ¶¶ 10-11.) The court finds that monetary sanctions are justified under the circumstances, but finds Plaintiff’s request excessive. Rather, the court finds that four hours in preparation of the motion and arguing the motion at counsel’s rate of $225.00, plus the $60.00 filing fee, is reasonable.

Accordingly, the court GRANTS Plaintiff’s request for monetary sanctions in the reduced amount of $960.00 against Defendant Jay Min Chen and his counsel of record, to be paid within 30 days of this order. Defendant’s request for monetary sanctions is DENIED.

(2) PLAINTIFF’S MOTION TO COMPEL FURTHER RESPONSES TO REQUEST FOR PRODUCTION OF DOCUMENTS, SET ONE

Legal Standard

Code of Civil Procedure section 2031.310 provides, in relevant part, as follows:

(a) On receipt of a response to a demand for inspection, copying, testing, or sampling, the demanding party may move for an order compelling further response to the demand if the demanding party deems that any of the following apply:

(1) A statement of compliance with the demand is incomplete.

(2) A representation of inability to comply is inadequate, incomplete, or evasive.

(3) An objection in the response is without merit or too general.

(b) A motion under subdivision (a) shall comply with both of the following:

(1) The motion shall set forth specific facts showing good cause justifying the discovery sought by the demand. . . .

(2) The motion shall be accompanied by a meet and confer declaration under Section 2016.040.

The burden is on the moving party to establish good cause for production by setting forth specific facts justifying the discovery sought by the demand. (Code Civ. Proc., § 2031.310, subd. (b)(1).)

Discussion

Documents Pertaining to Golden Globalinks, Inc. (Request Nos. 2-8, 11, 12, 17, 19, 21, 27, 43)

Request for Production numbers two through eight request for documents pertaining to Golden Globalinks, Inc.’s corporate documents pertaining to the following: withdrawals of corporate funds by Defendant from the corporation’s bank accounts; corporate payments to Defendant; loans; services to tourist groups; the corporation’s corporate filings; the corporation’s assets, debts, and other financial information. (See Yabko Decl., Exh. A.) Request numbers eleven and twelve request for documents reflecting transactions between the corporation and Defendant, and any payments made by Defendant on behalf of the corporation. (See id.) Request number seventeen requests for documents regarding Defendant’s relationship with the corporation. (See id.) Request number nineteen asks for the corporation’s federal tax records. (See id.) Request number twenty-one asks for documents reflecting all correspondences between Defendant and United Pacific Bank – the bank from which the corporation allegedly sought and obtained a Small Business Administration loan of $2,136,000 for renovating and constructing the restaurant at issue. (See id; see Compl., ¶ 18.) Request number twenty-seven requests for documents evidencing credit card payments made by Defendant on behalf of the corporation. (See Yabko Decl., Exh. A.) Request forty-three, asks for the corporation’s state tax records. (See id.)

In response to each of the Requests, Defendant responded with the following statement:

Responding party is unable to comply, Responding party affirms that a diligent search and a reasonable inquiry has been made in an effort to comply with that demand. The inability to comply is because Propounding party has refused to comply with a director’s demand for inspection pursuant to Corporations Code §§ 1601and 1602 and the Operating Agreement and has refused to turn over company books and records for inspection. Said demand was made prior to the onset of litigation. Accordingly, if they have not been permanently destroyed or erased by HE, HE has sole custody, possession and control of relevant documents.

(See Yabko Decl., Exh. B.)

The relevance of the documents sought is obvious in light of the allegations in the complaint that Defendant misappropriated (a) Globalinks’ funds and cash, (b) funds in Globalinks’ bank accounts, (c) cash in Globalinks’ safe, (d) the funds from the Small Business Administration Loan from United Pacific Bank, (e) money from customers at the Restaurant, (f) Globalinks’ income, and (g) kickbacks, inducements, and contributions from third-parties, through various schemes– all of which was for Defendants’ own personal enrichment and to the detriment of He and Globalinks.

In her moving papers, Plaintiff argues that Defendant’s objections “are not warranted, are not in good faith, and the responses following the objections [are] not ‘complete and straightforward’ as required.” (Mot. 8:20-22.) The court finds that the contents of Defendant’s responses, however, are statutorily proper. Code of Civil Procedure section 2031.210, subdivision (a), requires a party responding to an inspection demand to respond separately to each item in the demand by one of the following: (1) a statement that the party will comply by the date set for inspection with the particular demand; (2) a statement that the party lacks the ability to comply with the particular demand; or (3) an objection to all or part of the demand. “A representation of inability to comply with the particular demand . . . shall affirm that a diligent search and a reasonable inquiry has been made in an effort to comply with the demand. This statement shall also specify whether the inability to comply is because the particular item or category has never existed, has been destroyed, has been lost, misplaced, or stolen, or has never been, or is no longer, in the possession, custody, or control of the responding party. The statement shall set forth the name and address of any natural person or organization known or believed by that part to have possession, custody, or control of that item or category of item.” (Code Civ. Proc., § 2031.230.)

Here, Defendant’s responses are compliant. However, the court is not convinced by Chen’s blanket assertion that all of the Requests call for corporate records reasonably within the possession of Plaintiff and Globalinks. Chen attests that Plaintiff has possession, custody, or control over “the tax returns, corporate filings, bank accounts, and other records requested.” (Chen Decl., ¶ 1.) On one hand, the court finds that it is reasonable to expect that corporate documents are in the possession of Plaintiff, or equally available to Plaintiff, who is alleged to be the majority shareholder of the corporation. (See Compl., ¶ 16.) Plaintiff has otherwise failed to state particular facts demonstrating to the court that Defendant possesses the requested corporate documents she seeks. Nevertheless, the court finds that the documents sought through Request numbers 2 (withdrawals made by Defendant from the corporation’s bank accounts), 3 (payments made by Defendant on behalf of the corporation), 4 (payments the corporation made to Defendant since 2009), 11 (payments received by Defendant on behalf of the corporation since 2009), 12 (transactions between Defendant and the Corporation since 2009), 21 (correspondence between Defendant and United Pacific Bank), and 27 (documents detailing credit card payments Defendant made on behalf of the corporation) fall outside of the scope of “tax records, corporate billings, bank accounts, or other corporate records,” which Chen attests are in Plaintiff’s possession as a majority shareholder of Globalinks. Furthermore, it is alleged in the complaint that the very nature of alleged wrongful conducts by Defendant falls outside of corporate records, and that Defendant and other have refused to release information such as payments on behalf of the corporation utilizing Defendant’s personal credit cards. (See, e.g., Compl., ¶¶ 46-47.) Accordingly, the court finds good cause for the production of documents sought through Request numbers 2, 3, 4, 11, 12, 21, and 27.

Accordingly, the motion is GRANTED as to Request Nos. 2, 3, 4, 11, 12, 21, and 27. The motion is DENIED as to Request Nos. 2, 5-8, 17, 19, and 43.

Documents Pertaining to Payments to and from Plaintiff (Request Nos. 9 and 10)

These Requests seek documents relating to payments to Plaintiff from Defendant, and payments from Plaintiff to Defendant, from 2009 to present.

To each, Defendant responded that a diligent search and a reasonable inquiry was made, but that Defendant is unable to comply because Plaintiff has sole custody, possession and control of relevant documents, and that Plaintiff has refused to produce to Defendant relevant corporate documents. (See Yabko Decl., Exh. B; see also Chen Decl., ¶ 1.)

While the court is not convinced by Defendant’s assertion that such records are “corporate” documents in the sole possession of Plaintiff, Plaintiff has not stated facts with particularity to enable the court to find good cause for the documents it seeks through these Requests. The burden is on the moving party to establish good cause for production by setting forth specific facts justifying the discovery sought by the demand. (Code Civ. Proc., § 2031.310, subd. (b)(1).) Plaintiff alleges in the complaint that Defendants were engaged in the embezzlement, stealing, skimming, misappropriating, converting, pilfering, and siphoning off of (a) Globalinks’ funds and cash, (b) funds in Globalinks’ bank accounts, (c) cash in Globalinks’ safe, (d) the funds from the Small Business Administration Loan from United Pacific Bank, (e) money from customers at the Restaurant, (f) Globalinks’ income, and (g) kickbacks, inducements, and contributions from third-parties, through various schemes– all of which was for Defendants’ own personal enrichment and to the detriment of He and Globalinks. However, Plaintiff does not explain how any transfer of funds between Defendant and He relate to any allegations of misappropriation of corporate funds, as alleged in the complaint.

Accordingly, the motion is DENIED as to Request numbers 9 and 10.

Documents Pertaining to Ecco Technologies, LLC, XTR, LLC, and OKK Trading, Inc. (Request Nos. 13, 15-16, 18, 20, 22-24)

These Requests seek documents reflecting transactions, relationships, correspondences, and contracts between: Defendant and Ecco Technologies, LLC (Request Nos. 13, 23, 24); Defendant and XTR (Request Nos. 15, 18, 20);Defendant and OKK Trading, Inc. (Request No 16); and Defendant and any other Defendant (Request No. 22).

In response to Request numbers thirteen, fifteen, sixteen, eighteen, and twenty, Defendant responded that a diligent search and a reasonable inquiry was made, but that Defendant is unable to comply because Plaintiff has sole custody, possession and control of relevant documents, and that Plaintiff has refused to produce to Defendant relevant corporate documents. (See Yabko Decl., Exh. B; see also Chen Decl., ¶ 1.) Defendant also responded with objections only to Request numbers thirteen, fifteen, sixteen, eighteen, and twenty-four on grounds that the Requests are not reasonably particularized, and as seeking documents protected by the attorney-client privilege and attorney work product doctrines. (See Yabko Decl., Exh. B.)

The court finds good cause for the requested documents, to the extent they are relevant to the allegations in the Complaint. It is alleged in the complaint that on March 8, 2017, Chen and Hung, on behalf of Globalinks, received a draft contract from Ecco Technologies, LLC, electronically signed by Derek Tabek, for the purchase of BiHitech Model G3-1200A USA, which is a machine designed to dispose certain waste materials safely and efficiently for the restaurant. (Compl., ¶ 25.) However, it is alleged that the machine was never purchased, and that Chen and Hung, using XTR (an alleged shell corporation), forged a new contract to procure part of the Small Business Administration loan on the false pretense of purchasing the machine, and diverted and siphoned the proceeds of the machine loan to themselves. (Compl., ¶ 26.) It is alleged that Defendant and Hung altered the Ecco Tech contract by replacing “Ecco Tech” with “XTR LLC,” which shares the same address as the Defendants’ company, OKK Trading, Inc. (Id.) Therefore, the requested documents are relevant to proving or disproving Plaintiff’s allegations that Defendants were engaged in a scheme to divert and siphon corporate funds intended for the Ecco machine loan to themselves.

The court is not convinced by Defendant’s contention that documents responsive to these requests are in the exclusive possession of Plaintiff as corporate records. Rather, documents concerning direct correspondences and transactions between Defendant and XTR, Ecco Technologies, LLC, and OKK Trading, Inc. are reasonably in possession of Defendant himself.

Furthermore, Defendant contends that Plaintiff’s requests for documents from 2009 are overly broad and have no relevance to this action, and therefore, the motion should be denied as to these Requests. The court notes that Plaintiff has not stated facts establishing good cause as to why documents specifically from 2009 should be produced, where the corporate was formed in 2016. (See Compl., ¶ 15.) The court therefore finds that Request numbers 13, 15-16, 18, 20, 22-24 should be tailored to seeking documents from the relevant period of 2016 to present.

Defendant otherwise fails to meet its burden of justifying the other objections raised in his responses to these Requests. (Coy v. Superior Court (1962) 58 Cal.2d 210, 220-21.) If documents are withheld on grounds of the attorney-client privilege or attorney work product doctrine, Defendant is to serve a code compliant privilege log. (Code Civ. Proc., § 2031.240, subd. (c)(1).)

Therefore, the court GRANTS the motion as to Request numbers 13, 15-16, 18, 20, 22-24, as stated herein.

Documents Related to Alleged Kickback Scheme (Request Nos. 1, 14, 28, 29, 32, 38-42)

These requests seek documents reflecting transactions, relationships, correspondences, and contracts between: Defendant and Tina Chiang (Request Nos. 1, 40); Defendant and MJI Construction Inc. (Request Nos. 28, 41-42); and Defendant and Generator Services Co. (Request Nos. 14, 29, 32, 38-42).

The court finds good cause for the requested documents, to the extent they are relevant to the allegations in the Complaint. It is alleged that Defendants were engaged in a “kickback scheme” in which third parties Tina Chiang (CPA) of Tina T. Chiang Accountancy Corporation, Generator Services, Co., Inc., and MJI Construction Inc. provided Defendants with unauthorized kickbacks, inducements, and contributions for using their services, and inflated the amount the corporation paid for such third-party services. (Compl., ¶¶ 33, 38-41.) Therefore, the documents requested are relevant for purposes of proving or disproving Plaintiff’s allegations related to the “kickback scheme” by Defendants.

As stated above, the court is not convinced by Defendant’s contention that documents responsive to these requests are in the possession of Plaintiff as corporate records. Rather, documents concerning direct correspondences, transactions, and payments between Defendant and Tina Chiang, Generator Services, Co., Inc., and MJI Construction Inc. are reasonably in possession of Defendant himself.

Also as stated previously, Defendant’s argument that the Requests are overly broad on its face are well taken. The court finds that Request numbers 1, 14, 28, 29, 32, 38-42 should be tailored to seeking documents from the relevant period of 2016 to present.

However, Defendant otherwise fails to meet its burden of justifying the other objections raised in his responses to these Requests. (Coy, supra, 58 Cal.2d at 220-21.) If documents are withheld on grounds of the attorney-client privilege or attorney work product doctrine, Defendant is to serve a code compliant privilege log. (Code Civ. Proc., § 2031.240, subd. (c)(1).)

Therefore, the court GRANTS the motion as to Request numbers 1, 14, 28, 29, 32, 38-42, as stated herein.

Documents Related to Alleged Tourist Scheme (Request Nos. 25, 26, 30, and 37)

These Requests seek documents regarding relationships, agreements, correspondences between Defendant and tourist companies who dined at the restaurant.

In response to each of the Requests, Defendant responded with only objections on the grounds of the Requests not being reasonably particularized, attorney-client privilege and work product, and on the ground that the term “tourist companies” is vague and ambiguous.

It is alleged in the complaint that since the opening of the Golden Corral restaurant until present, Defendant, without authorization, made direct arrangements with various tourist companies to allow tourists to eat meals at the restaurant in exchange for direct payment to Defendant, which Defendant then pocketed for his own benefit. (Compl., ¶ 36.) In light of the allegations, the court does not find the Requests to be vague or ambiguous. The court also finds that the Requests are sufficiently particularized to reasonably allow Defendant to respond.

In response to Request number thirty, Defendant states that a diligent search and a reasonable inquiry was made, but that Defendant is unable to comply because Plaintiff has sole custody, possession and control of relevant documents, and that Plaintiff has refused to produce to Defendant relevant corporate documents. (See Yabko Decl., Exh. B; see also Chen Decl., ¶ 1.) Request number thirty, which seeks any and all documents regarding receipt of payments from tourist companies who dined at the restaurant, is reasonably in the possession of Plaintiff and the corporation. Plaintiff fails to state facts with specificity in response to establish good cause for the documents it seeks.

Therefore, the motion is GRANTED as to Request numbers 25, 26, 30, and 37, and DENIED as to Request number 30.

Documents Related to Alleged Safe Scheme (Request No. 31)

Request number thirty-one asks Defendant to produce documents detailing his payments to the cleaning service for the work at the restaurant.

Good cause exists for the request because it is alleged that Defendant took cash directly from Globalinks’ safe, under false pretenses to make payments on behalf of Globalinks for a “cleaning service.” (Compl., ¶ 37.)

Again, the court is not convinced by Defendant’s contention that documents responsive to these requests are in the possession of Plaintiff as corporate records. Rather, documents concerning direct payments by Defendant to cleaning services for work at the restaurant are reasonably likely to be in the possession of Defendant. If Defendant is not in possession of such records, Defendant should state so in his verified responses.

Furthermore, the court finds that Request number thirty-one is sufficiently tailored to seeking documents from a relevant period, and Defendant otherwise fails to justify his objections on grounds of privacy, the attorney-client privilege, and attorney work-product doctrines. If documents are withheld on such grounds, Defendant is to serve a code-compliant privilege log. (Code Civ. Proc., § 2031.240, subd. (c)(1).)

Accordingly, the motion is GRANTED as to Request number 31.

Documents Relied Upon for Discovery Responses (Request Nos. 33-36)

These requests ask Defendant to produce documents relied upon by Defendant in responding to Plaintiff’s Form Interrogatories, Special Interrogatories, Requests for Admission, and Requests for Production.

The court finds that the requests are reasonably particularized for the Defendant to respond. Defendant fails to otherwise justify his objections in his opposition. If documents are withheld on grounds of the attorney-client privilege or work product doctrines, Defendant is to serve a code-compliant privilege log. (Code Civ. Proc., § 2031.240, subd. (c)(1).)

Accordingly, the motion is GRANTED as to Request numbers 33-36, inclusive.

Documents Related to Defendant’s Personal Bank Accounts (Request No. 44)

Request number forty-four seeks from Defendant all documents regarding his personal bank account statements from 2016 to present.

Defendant responded with only objections on grounds that the Request invades his right of privacy, and constitutes premature inquiry into financial matters where no basis for punitive damages has been established.

It is specifically alleged in the complaint that Defendant made unauthorized payments with corporate funds on his personal credit card account. (Compl., ¶¶ 30-32.) Therefore, there is good cause for the documents Plaintiff seeks.

Defendant, in opposition, did not attempt to justify its objections.

Accordingly, the motion is GRANTED as to Request number 44.

Documents Related to JC Globalinks’ Financial and Corporate Documents (Request Nos. 45-55)

Request numbers forty-five through fifty-five seeks documents relating to corporate documents, financial documents, and loans regarding JC Globalinks.

Defendant responded to each of the Requests with objections only, on grounds that the Requests are not reasonably particularized, are overbroad, are invasive of Defendant’s right of privacy, and that the Requests constitute premature inquiry into financial matters where no basis for punitive damages has been established.

The court finds that Plaintiff has not established good cause for the documents she seeks through these Requests. The burden is on the moving party to establish good cause for production by setting forth specific facts justifying the discovery sought by the demand. (Code Civ. Proc., § 2031.310, subd. (b)(1).) The complaint is devoid of any allegations regarding JC Globalinks, and Plaintiff does not provide specific facts justifying discovery of its records. Rather, Plaintiff generically argues in the separate statement that Defendant has embezzled corporate funds through various fraudulent schemes, a number of which were conducted outside of the corporate records. Such a contention, without any specific facts regarding JC Globalinks is insufficient to allow the court to determine whether good cause exists to compel discovery of JC Globalinks’ records.

Accordingly, the motion is DENIED as to Request numbers 45-55, inclusive.

Monetary Sanctions

Plaintiff seeks monetary sanctions against Defendant in the amount of $2,895.00. (See Code Civ. Proc., §§ 2031.310, subd. (h); 2023.010.) The requested amount is based upon a total of 7.1 hours allegedly expended by Plaintiff’s counsel in meet and confer efforts and in preparing the motion, at a billing rate of $225.00 per hour. (Yabko Decl., ¶ 10.) Counsel additionally estimates a total of 5.5 hours traveling to and from the motion hearing, and arguing the motion. Plaintiff additionally seeks recovery of the $60.00 filing fee. (Yabko Decl., ¶ 11.) While the court finds that monetary sanctions are justified under the circumstances, the sanctions amount sought by Plaintiff is excessive under the circumstances.

Therefore, the court finds monetary sanctions against Defendant in the amount of $1,410 for 6 hours of attorney time plus the $60.00 filing fee to be reasonable under the circumstances.

(3) PLAINTIFF’S MOTION FOR RELEASE OF DOCUMENTS PURSUANT TO SUBPOENA DUCES TECUM

Discussion

On March 28, 2019, Plaintiff served a deposition subpoena for production of records upon MJI Construction, Inc. The production date was set for April 17, 2019. Plaintiff contends that, to date, MJI Construction, Inc. has not complied with the subpoena. Therefore, Plaintiff seeks an order compelling non-party MJI Construction, Inc. to comply with the March 28, 2019 subpoena for business records.

On February 10, 2020, Plaintiff filed an Application to Continue Hearing on Plaintiff’s Motion for Release of Documents from MJI Construction Pursuant to Subpoena. Plaintiff states that since retaining counsel, MJI Construction, Inc. has sought to informally resolve this matter with Plaintiff, and that Plaintiff therefore requests the court to continue the hearing to a later date in March 2020.

Accordingly, the motion is continued to March ____, 2020.

Plaintiff to give notice.