Case Name: Judis Corso, et al. v. M.L. Zager, P.C., et al.

Case No.: 16CV298607
Motion (1) to Enforce Court Order; (2) for Issue, Evidence, or Terminating Sanction Against Defendant, M.L. Zager, P.C.; and (3) for Monetary Sanction Against Defendant, M.L. Zager, P.C.

In this putative class action complaint, plaintiff Judis Corso (“Corso”), individually and on behalf of all others similarly situated, alleges she incurred a consumer debt but was unable to pay the debt and defaulted. (Complaint, ¶¶17 – 18.) The debt was consigned, placed, or otherwise transferred to defendants M.L. Zager, P.C.; Joseph P. Loughlin; and Robert Bruce Hunter (“Defendants”) who sent Corso a collection letter dated January 13, 2016 in an attempt to collect the debt. (Complaint, ¶¶19 – 23.) Defendants knew or should have known that their conduct was directed towards a senior citizen. (Complaint, ¶24.) The collection letter did not include the notice required by Civil Code section 1812.700, subdivision (a).

On August 16, 2016, plaintiff Corso filed a putative class action complaint against Defendants. On September 23, 2016, Defendants filed an answer to the complaint.

On October 4, 2016, plaintiff filed a demurrer to Defendants’ answer.

On November 4, 2016, Defendants filed a first amended answer.

Discovery Dispute

On February 7, 2017, plaintiff Corso filed a motion to compel defendant M.L. Zager, P.C.’s (“Zager”) further responses to special interrogatories and further production of documents responsive to request for production of documents (“RPD”), set one.

On March 23, 2017, the court issued the following order:

Plaintiff’s Motion to Compel Further Responses and Discovery and for Monetary Sanctions is GRANTED, in part. CCP Section 2031.220 is quite specific as to what constitutes a legally sufficient response to a document request. An agreement to comply must state: That the production and inspection demanded will be allowed (in whole or in part) and that the subject documents that are in the responding party’s possession, custody or control will be produced (except to the extent of any objections). And, documents must be produced either as they are kept in the normal course of business or sorted and labeled to correspond with the categories in the document demand. CCP 2031.280. If a party is claiming privilege, the objecting party must provide sufficient factual information to allow an evaluation of the merits of the claim. Defendants did not comply with the foregoing and must provide further responses and documents, if any, to RFD #2,3,5,6,7,8,20,24 as relevance/good cause has been demonstrated as to all RFD. Defendants must produce a privilege log as to any documents on which a privilege is claimed. The Court wants the parties to meet and confer on the language of a Belaire-West privacy notice as to interrogatory #9 and report to the court on same. Further responses and documents must be produced within 20 days of service of this order. Defendants must pay monetary sanctions in the amount of $2,100 to plaintiff’s counsel in the same time frame.

On April 10, 2017, defendant Zager served a supplemental response to RPD which, according to plaintiff Corso, did not contain a further document production and did not include a Code-compliant privilege log.

On May 2, 2017, plaintiff Corso’s counsel sent a letter to defendant Zager’s counsel in an attempt to meet and confer regarding the perceived deficiencies. As of May 30, 2017, defendant Zager’s counsel did not respond to this letter and did not provide any further supplemental response or produce any further responsive documents.

On May 30, 2017, plaintiff Corso filed the motion now before the court, a motion (1) to compel defendant Zager to comply with the court’s March 23, 2017 order; (2) for imposition of issue, evidence, or terminating sanctions against defendant Zager; and (3) imposing further monetary sanctions against defendant Zager.

On May 30, 2017, defendant Zager’s counsel responded to plaintiff Corso’s counsel’s May 2, 2017 meet and confer letter.

On July 3, 2017, defendant Zager served plaintiff Corso with second supplemental responses. On July 11 and July 18, defendant Zager’s counsel sent e-mail correspondence to plaintiff Corso’s counsel inquiring whether the second supplemental responses were now sufficient, but did not receive a response.

I. Plaintiff Corso’s motion to compel compliance with the court’s March 23, 2017 order is GRANTED, in part, and DENIED, in part. Plaintiff Corso’s motion for sanctions is GRANTED, in part.

Code of Civil Procedure section 2031.310, subdivision (i) states, in relevant part, “if a party fails to obey an order compelling further response, the court may make those orders that are just, including the imposition of an issue sanction, an evidence sanction, or a terminating sanction under Chapter 7 (commencing with Section 2023.010). In lieu of, or in addition to, that sanction, the court may impose a monetary sanction under Chapter 7 (commencing with Section 2023.010).”

Code of Civil Procedure section 2031.320, subdivision (c) states, in relevant part, “if a party then fails to obey an order compelling inspection, copying, testing, or sampling, the court may make those orders that are just, including the imposition of an issue sanction, an evidence sanction, or a terminating sanction under Chapter 7 (commencing with Section 2023.010). In lieu of or in addition to that sanction, the court may impose a monetary sanction under Chapter 7 (commencing with Section 2023.010).”

Plaintiff Corso contends defendant Zager failed to comply with the court’s order compelling a further response and compelling further production in several respects. First, plaintiff Corso contends the privilege log provided by defendant Zager is insufficient. “If an objection is based on a claim of privilege or a claim that the information sought is protected work product, the response shall provide sufficient factual information for other parties to evaluate the merits of that claim, including, if necessary, a privilege log.” (Code Civ. Proc., §2031.240, subd. (c)(1).) Plaintiff Corso acknowledges defendant Zager’s supplemental response states, “The only documents withheld are the attorney client communications between [Zager] and defense counsel,” but finds this statement insufficient because it does not “provide sufficient factual information … to evaluate the merits of that claim.” Defendant Zager also provided plaintiff Corso with a privilege log which identifies “various correspondence between ML Zager and Defense Counsel” made “after service of complaint” as protected by the attorney client communication [privilege] and/or attorney work product doctrine. In view of the correspondence between the parties’ counsel, the court finds this privilege log to be adequate.

In reply, plaintiff Corso also takes issue with defendant Zager’s identification of a “Contract Between ML Zager and DeSocia” dated 1/1/15 as a privileged document. Plaintiff Corso takes the position that defendant Zager cannot refuse to produce this document arguing the document should instead be designated confidential and produced pursuant to the stipulated protective order. However, plaintiff Corso’s motion seeks to compel compliance with the court’s March 23, 2017 order. That order dictates only that “Defendants must produce a privilege log as to any documents on which a privilege is claimed.” Defendant Zager has done so. To the extent plaintiff Corso is challenging the designation of that document as privileged, the appropriate procedure is to attempt to resolve the matter informally and thereafter file a motion to compel further response.

Plaintiff Corso next takes issue with defendant Zager’s supplemental response by arguing that it does not comply with Code of Civil Procedure section 2031.280, subdivision (a) which states, “Any documents produced in response to a demand for inspection, copying, testing, or sampling shall either be produced as they are kept in the usual course of business, or be organized and labeled to correspond with the categories in the demand.” According to plaintiff Corso, defendant Zager’s supplemental response does not organize or label the documents to correspond with the categories in the demand. In opposition, defendant Zager indicates that it previously identified the documents, by Bates number, with the corresponding RPD categories when it submitted its opposing separate statement in response to plaintiff Corso’s original motion and also provided the same identification in its May 30, 2017 meet and confer letter. To be even more complete, defendant Zager provided a second supplemental response which identifies documents by Bates number. As such, the court finds plaintiff Corso’s complaint in this regard to now be moot.

Plaintiff Corso further contends defendant Zager’s production of document is incomplete with regard to RPD, numbers 2, 3, 5, 6, 8, 20, and 24. In reply, plaintiff Corso limits this argument to defendant Zager’s production with regard to RPD, numbers 3, 5 and 8 are incomplete. The court’s May 23, 2017 order only required further production of documents “if any.” Plaintiff Corso contends the production is incomplete insisting more documents exist. Defendant Zager’s supplemental response and second supplemental response fails to comply with Code of Civil Procedure section 2031.220 which requires, in relevant part, “A statement that the party to whom a demand for inspection, copying, testing, or sampling has been directed will comply with the particular demand shall state that the production, inspection, copying, testing, or sampling, and related activity demanded, will be allowed either in whole or in part, and that all documents or things in the demanded category that are in the possession, custody, or control of that party and to which no objection is being made will be included in the production.” (Emphasis added.) Absent such a statement, the court cannot determine whether all relevant documents have been produced. As previously explained in the court’s March 23, 2017 order, defendant Zager’s response did not comply with Code of Civil Procedure section 2031.220 and defendant Zager’s supplemental response and second supplemental response similarly fail to comply.

Accordingly, defendant Zager shall provide further responses and documents, if any, to RPD, numbers 3, 5 and 8. Plaintiff Corso’s motion to compel compliance with the court March 23, 2017 order is otherwise DENIED. Plaintiff Corso’s motion for issue, evidence, or terminating sanctions is DENIED. Plaintiff Corso’s motion for monetary sanctions is GRANTED, in part. Although plaintiff Corso’s motion was rendered moot, in part, by defendant Zager’s second supplemental response, the court has discretion to impose sanctions nonetheless. (See Sinaiko Healthcare Consulting, Inc. v. Pacific Healthcare Consultants (2007) 148 Cal.App.4th 390, 408-409.) Defendant Zager shall pay $500 to plaintiff Corso within 20 calendar days of the date of the filing of this order.

II. Plaintiff’s request for the court to adopt her Belaire-West notice and Opt-Out Form and order defendant Zager to mail it within 20 days is GRANTED.

On April 6, 2017, defendant Zager’s counsel emailed plaintiff Corso’s counsel in an attempt to meet and confer on the language of a Belaire-West privacy notice as required by the court’s May 23, 2017 order. Defendant Zager’s counsel indicated she would be out of the country from the evening of April 10, 2017 until April 22, 2017.

On April 10, 2017, plaintiff Corso’s counsel responded offering modifications to the proposed Belaire-West opt-out notice.

On May 2, 2017, plaintiff Corso’s counsel asked defendant Zager’s counsel to respond to his April 10, 2017 email.

On May 18, 2017, defendant Zager’s counsel emailed plaintiff Corso’s counsel with proposed revisions to the Belaire-West notice. In the email, defendant Zager’s counsel opined, “the Court should make a decision about whether the notice should be opt in or opt out. As I noted in the initial email I sent, the proposed class is more likely to not receive the notice and to not read the notice. I believe that the circumstances militate against an opt out notice.”

Plaintiff Corso contends the parties are at an impasse with regard to whether the notice should be opt-in or opt-out and request the court adopt plaintiff Corso’s proposed Belaire-West notice which contains an opt-out provision.

Belaire-West Landscape Inc. v. Superior Court (2007) 149 Cal.App.4th 554, 556 (Belaire-West) involved a wage and hour lawsuit brought by a class representative on behalf of a putative class of the defendant’s current and former employees. (Belaire-West, supra, 149 Cal.App.4th at p. 556.) The named plaintiff was employed by the defendant in 2003, and brought suit against the defendant in 2004. (Ibid.) Prior to certification of the putative class, the named plaintiff served a discovery request on the defendant asking for the names, telephone numbers, and addresses of the defendant’s current and former employees going back to the year 2000. (Ibid.) After the defendant refused to provide a substantive response, the plaintiff filed a motion to compel, and the trial court ordered the defendant to respond. (Ibid.) The trial court also issued an order that each putative class member be sent a letter advising him or her of the right to opt out of having his or her name and contact information shared with the plaintiff’s counsel. (Belaire-West, supra, 149 Cal.App.4th at p. 556.) Specifically, the letter approved by the trial court contained the following information: (1) an explanation of the nature of the lawsuit and of the assistance sought by plaintiff’s counsel; (2) an indication that the employee was under no obligation to help either side in the suit, and an assurance that the defendant could not retaliate against the employee for providing assistance to the plaintiff; (3) an indication that defense counsel may also contact the employee; (4) contact information for both parties’ attorneys; and (5) information on how to opt out of having one’s name and contact information disclosed to the plaintiff’s attorney. (Id. at p. 557.) Without deciding that an opt-out notice of this nature was necessary to protect the privacy of the defendant’s employees, the court of appeal determined that the use of the notice was an adequate safeguard of those employees’ privacy rights. (Id. at pp. 561-562.)

In reviewing the proposed Belaire-West notices submitted by plaintiff Corso and defendant Zager, the court hereby approves the proposed Belaire-West notice and opt-out form submitted by plaintiff Corso. Defendant Zager shall prepare and mail the Belaire-West notice within 20 calendar days of the date of the filing of this order and respond to plaintiff Corso’s special interrogatory, number 9 within 60 calendar days of the date of the filing of this order.