Ratti v. Microsonic Systems, Inc. et al.		CASE NO. 112CV224158
DATE: 25 April 2014	TIME: 9:00	LINE NUMBER: 4

This matter will be heard by the Honorable Judge Socrates Peter Manoukian in Department 19 in the Old Courthouse, 2nd Floor, 161 North First Street, San Jose. Any party opposing the tentative ruling must call Department 19 at 408.808.6856 and the opposing party no later than 4:00 PM Thursday 24 April 2014.  Please specify the issue to be contested when calling the Court and counsel.

On 25 April 2014, the motion of Microsonic Systems, Inc. (“Defendant”) for Relief from Waiver was argued and submitted.  Jayant Ratti (“Plaintiff”) filed formal opposition to the motion.

I.             Background

In the underlying action, filed on 09 May 2012, Plaintiff accused Defendant of breach of contract, fraud, defamation, and wrongful termination. Plaintiff’s complaint alleges the following: that Defendant’s agents slandered him, Defendant’s agents induced him to move to California for a salary of $95,000.00 and a $15,000.00 bonus but subsequently paid him a salary of only $45,000.00 and a loan of $7,000.00, Defendant’s agents harassed and retaliated against him after he objected to Defendant’s alleged use of pirated software, and Defendant refused to pay his final two paychecks.

Defendant was initially represented by the law firm of Colt / Wallerstein LLP.  Mr. Thomas Wallerstein (“Wallerstein”) became Defendant’s counsel and began working for Venable LLP.  Colt / Wallerstein LLP subsequently became defunct, and a new firm, Colt Singer Bea LLP, began operating at Colt / Wallerstein LLP’s former address.  This matter concerns discovery propounded after Wallerstein announced his departure from Colt / Wallerstein LLP to Plaintiff’s counsel but before substitution of counsel forms were filed.

II.            Discovery Dispute

Defendant alleges the following:

On 01 October 2014, Wallerstein, Defendant’s counsel, emailed to inform Plaintiff that, effective immediately, he was working at Venable LLP, would continue to represent Defendant, and “would file substitution of counsel forms shortly.”  (Wallerstein Decl. at ¶ 3.)  The email contained Wallerstein’s new contact information in the signature line.  That day, Wallerstein also sent additional emails from the Venable LLP email address and received emails from Plaintiff’s counsel’s office.

On 10 October 2014, Plaintiff attempted to serve Wallerstein by mail with Demand for Inspection of Documents, Set Two at Colt / Wallerstein LLP’s former address.  Wallerstein states that he is not aware of whether Colt Singer Bea LLP received the demand and he was not notified by anyone at the firm.  (Wallerstein Decl. at ¶ 5.)

On 11 October 2014, Defendant filed and formal substitutions of counsel and served Plaintiff by mail.

On 31 January 2014, Defendant learned of Plaintiff’s Demand for Inspection of Documents, Set Two (“Plaintiff’s Demand”).

On 03 February 2014, Defendant served responses and objections to Plaintiff’s Demand.

On 03 April 2014, Defendant filed this motion.

III.           Discussion

A.           Defendant’s Motion for Relief from Waiver

Code of Civil Procedure section 2031.300(a) states that a party who fails to serve a timely response to a demand for inspection waives any objection to the demand.  However, section 2031.300(a) further states that:

“[t]he court, on motion, may relieve that party from this waiver on its determination that both of the following conditions are satisfied:

(1) The party has subsequently served a response that is in substantial compliance with Sections 2031.210, 2031.220, 2031.230, 2031.240, and 2031.280.

(2) The party’s failure to serve a timely response was the result of mistake, inadvertence, or excusable neglect.”

The applicable standard under these circumstances is the same as for relief from default under Code of Civil Procedure section 473(b).  (City of Fresno v. Sup. Ct. (Green) (1988) 205 Cal.App.3d 1459, 1467 (noting that “being busy, or not fully understanding the provisions of a code section” are not sufficient to grant relief).)

Defendant states that Plaintiff served Demand for Inspection of Documents, Set Two on a law firm which Plaintiff knew was no longer representing Defendant and no longer in operation.  Defendant argues that that the response served on 03 February 2014 was in substantial compliance with Code of Civil Procedure sections 2031.210, 2031.220, 2031.230, 2031.240, and 2031.280 and that the failure to serve a timely response was excusable due to Wallerstein’s 01 October 2014 email informing Plaintiff’s counsel that he was working at Venable LLP.

Although Defendant’s response to Plaintiff’s Demand consisted entirely of general objections and objections to specific demands, such a response is code-complaint.  (Code of Civil Procedure § 2031.210(a)(3).)  The response is in substantial compliance with Code of Civil Procedure sections 2031.210, 2031.220, 2031.230, 2031.240, and 2031.280.

Defendant has also shown grounds for excusable neglect in failing to respond to Plaintiff’s Demand.  Defendant’s counsel communicated by email to Plaintiff’s counsel that he had transferred to Venable LLP, would continue to represent the Defendant, and would be filing substitution of counsel forms.  While Plaintiff’s Demand was served by mail on 10 October 2014, it is unreasonable to assume it was received by Defendant’s counsel before the substitution of counsel form was filed on 11 October 2014, the following day.

Further, Defendant’s counsel subsequently responded to Plaintiff’s Demand on 03 February 2014, shortly after receiving Plaintiff’s counsel’s email on 31 January 2014 requesting responses.  As Plaintiff’s counsel received notice that Wallerstein was no longer working at Colt / Wallerstein LLP due to the 01 October 2014 email and the substitution of counsel form served merely one day after the Demand was served by mail, the Court believes Plaintiff’s failure to serve a timely response was the result of excusable neglect.  As Defendant served a response in substantial compliance and the failure to serve a timely response was justified by excusable neglect, Defendant is probably entitled to be relieved from waiver of objections to Plaintiff’s Demand.

               B.           Plaintiff’s Request to Reschedule This Hearing

Plaintiff’s Opposition argues that Plaintiff’s service was proper and that “Defendant was not able to state a proper objection to the Demand when it’s (sic) very late response was finally sent.”  Plaintiff also requests that Defendant’s motion be moved to 16 May 2014, the day of the hearing on Plaintiff’s Motion to Compel further responses to Plaintiff’s Demand for Inspection of Documents, Set Two.

Defendant’s Reply to Plaintiff’s Opposition argues that the motions should be heard separately because the Defendant’s Motion for Relief addresses whether good cause exists to grant relief from waiver of objections and Plaintiff’s motion to compel concerns the merits of Defendant’s objections.  Defendant also argues that hearing the matters separately is prudent because it clarifies whether Defendants are deemed to have waived their objections to Plaintiff’s Demand.

While the issues to be determined in Defendant’s motion for relief and Plaintiff’s motion to compel further responses to the Demand are separate, consolidating the two hearings is an efficient way for this Court to handle both motions.  Therefore, the Court GRANTS Plaintiff’s request to move this matter to the 16 May 2014 hearing.

IV.           Conclusion

Defendant’s motion is DEFERRED.  The Court is, at this point, inclined to relieve Defendant from waiver of objections to Plaintiff’s Demand for Inspection of Documents, Set Two.

Plaintiff’s request to move this matter to the 16 May 2014 hearing on Plaintiff’s motion to compel further responses to Plaintiff’s Demand for Inspection of Documents, Set Two is GRANTED.