Case Name: Willow TV International, Inc. v. Elephant Capital, PLC, et al.
Case No.: 1-14-CV-266294

I. Background

This is an action for breach of contract and unfair competition. In the complaint, plaintiff/cross-defendant Willow TV International, Inc. (“Willow”) alleges the following: Pursuant to a written contract (“the Agreement”), defendant/cross-complainant Elephant Capital PLC (“Elephant”) agreed to sell its ownership interest in defendant/cross-complainant Global Cricket Ventures Limited (“GCV”) to cross-defendant/cross-complainant Keraton Holdings Limited (“Keraton”), and Keraton agreed to determine the purchase price based on the value of GCV’s assets. (Compl., ¶¶ 2-3, 5-11, 13, & 32.) Due to uncertainties concerning GCV’s assets, Keraton’s ability to calculate payment was delayed until 2014, at which time Elephant breached the Agreement by failing to convey its interest. (Id., ¶¶ 13-29 & 33.) Keraton assigned its rights under the Agreement to Willow. (Id., ¶ 30.) Willow asserts causes of action for (1) breach of contract (against Elephant); (2) declaratory relief (against Elephant and GCV [collectively, “GCV Parties”]); (3) accounting (against GCV Parties); (4) unjust enrichment/restitution (against GCV); and (5) unfair competition in violation of the unfair competition law (“the UCL”) (against GCV Parties).

In their cross-complaint, GCV Parties allege that Willow filed this lawsuit in an attempt to force GCV to abandon its lawsuit pending in London against Vijay Srinivasan and Sameer Mehta (collectively, “Willow’s Principals”), it breached other contracts by filing this lawsuit, and the Agreement is not enforceable. (GCV Cross-Compl., ¶¶ 10-18 & 22-32.) GCV Parties assert claims against Willow and Keraton for (1) breach of contract; (2) unfair competition in violation of the UCL; and (3) declaratory relief.
In its cross-complaint, Keraton alleges that Willow’s Principals began discussing a possible business relationship with GCV, at which time Gaurav Burman (“Burman”), one of GCV’s senior members, advised that he was also an agent of Elephant. (Keraton Cross-Compl., ¶¶ 4-5.) Keraton further alleges that it executed the Agreement with Elephant and thus GCV has an accord and satisfaction of its obligation under an agreement with Willow’s Principals, but Elephant breached the Agreement by failing to transfer its interest in GCV to Keraton. (Id., ¶¶ 6-12.) Keraton asserts causes of action for (1) declaratory relief (against GCV Parties); (2) breach of contract (against Elephant); (3) accounting (against GCV Parties); (4) unjust enrichment/restitution (against GCV); and (5) unfair competition in violation of the UCL (against GCV Parties).

II. Discovery Dispute

On October 8, 2014, Willow served notice of deposition on GCV’s counsel, requiring Burman—GCV’s managing agent—to appear for deposition and provide testimony on December 1, 2014, at Willow’s counsel’s office in San Francisco.

Thereafter, Willow’s counsel emailed GCV’s counsel, seeking confirmation of Burman’s availability for his noticed deposition as well as the availability of other witnesses for their respective depositions. GCV’s counsel responded by email on November 4, 2014, advising that “[t]o facilitate scheduling I need to get from you dates that you could depose the witnesses where they work or reside.” On November 25, 2014, GCV’s counsel emailed Willow’s counsel, seeking dates when Willow’s counsel could “depose the witnesses where they work or reside” and stating that “Burman is located in London.” Willow’s counsel replied, asserting that Burman’s deposition must take place in California, advising that Willow would proceed with Burman’s deposition as noticed, and asking GCV’s counsel to confirm that Burman would appear. GCV’s counsel did not respond or otherwise indicate that Burman would not appear for his noticed deposition.
On December 1, 2014, Burman did not appear for his deposition.

Willow’s counsel sent a meet and confer letter to GCV’s counsel on December 10, 2014, advising that Burman failed to appear for deposition, and any objection to the notice—including any objection to the location—had been waived. Counsel also requested other dates when Burman and GCV’s counsel would be available for deposition in California. In response, GCV’s counsel asserted that GCV had not waived any objection to the location of Burman’s deposition, but also advised that Burman would be in San Francisco and therefore available for deposition in this state between January 20-22, 2015. Ultimately, the parties’ counsel were unable to mutually agree on a date and location for Burman’s deposition.
On February 6, 2015, Willow filed this motion to compel Burman to appear for deposition at the location stated in the notice and for monetary sanctions against GCV and its counsel. Willow also makes a request for judicial notice in support thereof. GCV filed an opposition to the motion on February 20, 2015, and requests an award of monetary sanctions against Willow and its counsel.
III. Discussion

A. Willow’s Request for Judicial Notice

In support of the motion, Willow requests judicial notice of GCV Parties’ cross-complaint and Burman’s declaration in support of a motion to quash service of summons.
Courts may take judicial notice of the existence of relevant court records, but not the truth of hearsay statements stated in declarations or affidavits filed with the court. (Evid. Code, § 452, subd. (d); People ex rel. Lockyer v. Shamrock Foods Co. (2000) 24 Cal.4th 415, 422, fn. 2 [relevance]; Lockley v. Law Office of Cantrell, Green, Pekich, Cruz & McCort (2001) 91 Cal.App.4th 875, 882 [hearsay statements in court records].)

The subject documents are court records that are relevant to pending issues. Therefore, the existence of the records is subject to judicial notice, but not the truth of hearsay statements or other facts stated therein.

Willow’s request for judicial notice is therefore GRANTED as to the existence of the records.

B. Motion to Compel Deposition Appearance & Testimony

“If, after service of a deposition notice, a party” or “managing agent” of a party, “without having served a valid objection under Section 2025.410, fails to appear for examination,” then “the party giving the notice may move for an order compelling the deponent’s attendance and testimony.” (Code Civ. Proc. [“CCP”], § 2025.450, subd. (a).)
Willow argues that an order compelling Burman to appear for deposition and provide testimony at the location stated in the notice is warranted because he failed to appear for his noticed deposition without having served an objection and thus waived any objection to the location described in the notice.
In opposition, GCV asserts that the objection based on the location of Burman’s deposition has been preserved, Burman is a nonresident who may only be deposed in London pursuant to CCP section 2027.010, and the Court lacks the authority to compel him to appear for deposition in California.

1. Service of an Objection Under CCP Section 2025.410

CCP section 2025.410, subdivision (a), states that “[a]ny party served with a deposition notice that does not comply with Article 2 (commencing with Section 2025.210) waives any error or irregularity unless that party promptly serves a written objection specifying that error or irregularity at least three calendar days prior to the date for which the deposition is scheduled.” Article 2 includes CCP sections 2025.250-2025.260, which set forth the permissible locations for a deposition in this state. Thus, an objection based on the noticed location of a deposition under CCP sections 2025.250-260 or 2027.010 is waived unless it was served in conformity with CCP section 2025.410. (Parker v. Wolters Kluwer United States, Inc. (2007) 149 Cal.App.4th 285, 295, fn.22.) Waiver occurs regardless of whether the deponent is a resident of California. (See id., at p. 295 [finding waiver where a party-deponent claimed to reside outside of this state].)
GCV asserts that objections based on the location noticed for Burman’s deposition have been preserved because its counsel asserted objections in his emails to Willow’s counsel. To be effective, email service of objections under CCP section 2025.410 must conform to the requirements of CCP section 1010.6 and the California Rules of Court (“CRC”). (See CCP, § 2016.050 [“Section 1013 applies to any method of discovery”]; see also CCP, § 1013, subd. (g) [permitting email service as authorized by CCP section 1010.6 and the CRC].) CCP section 1010.6 and CRC, rule 2.251(b) only authorize service by email where the party to be served agreed to accept email service and filed a notice of consent to electronic service with the court. Here, Willow never agreed to accept electronic service. Therefore, GCV’s counsel’s emails did not effectuate service of objections under CCP section 2025.410. In any event, GCV asserts that three emails sent by its counsel contain objections; however, the first two emails do not contain any objection, and since the third email was sent several weeks after the date noticed for deposition, any objection to the noticed location had already been waived.

Thus, any objection based on defects in the deposition notice, including any objection to the location of the deposition under CCP sections 2025.250-2025.260 or CCP section 2027.010, has been waived.

2. The Court’s Authority to Compel Burman to Appear

GCV further argues that the Court cannot compel Burman, a nonresident, to appear for deposition in California, and cites Toyota Motor Corporation v. Superior Court (2011) 197 Cal.App.4th 1107 (“Toyota”) and CCP section 1989 in support of its position. In contrast, Willow relies on Glass v. Superior Court (1988) 204 Cal.App.3d 1048 (“Glass”) for the proposition that courts have the authority to compel nonresident parties to appear for deposition in this state.

Glass and Toyota reached opposite conclusions, and no other published opinion has addressed the issue of whether a court may compel a nonresident party deponent to appear for deposition in California. On the one hand, the court in Glass held that a nonresident managing agent of a party could be compelled to appear for deposition in this state. (Glass, supra, at pp. 1050 & 1053.) On the other hand, the court in Toyota held that CCP section 1989 precludes courts from compelling a nonresident to appear for deposition in this state, and expressly rejected and declined to follow the Glass decision. (Toyota, supra, at pp. 1123-1125 & fn. 20.)

This case is distinguishable from Toyota for several reasons. First, in Toyota, the objecting party notified the plaintiffs that it would not produce the deponents before the date noticed for deposition. (Toyota, supra, at pp. 1110-1111.) Here, neither GCV nor Burman served objections or advised that Burman would not appear for deposition before the date stated in the notice, and—as discussed above—it follows that they waived any objection based on location. Second, the facts in Toyota involved “depositions of five individual Toyota employees as individual witnesses, not corporate representatives.” (Id., at p. 1110.) In contrast, this matter pertains to the deposition of a party’s managing agent in his capacity as a corporate representative. While a footnote in the Toyota decision indicates that the holding also applies to managing agents of corporate parties (id., p. 1125, fn. 20), that statement is dicta and not binding authority. (See generally Areso v. CarMax, Inc. (2011) 195 Cal.App.4th 996, 1006 [“[m]ere observations by an appellate court are dicta and not precedent, unless a statement of law was ‘necessary to the decision, and therefore binding precedent’”].) Lastly, in Toyota, the nonresident-deponents had no other reason to come to California, and their employer had not asserted claims in this state. (Toyota, supra, at p. 1110.) Here, however, both parties proffer evidence suggesting that Burman sometimes travels to California (GCV’s counsel’s decl., ¶ 5; Willow’s RJN, Ex. 2), and GCV has asserted claims in this action. Accordingly, GCV’s reliance on Toyota is misplaced.

In light of the foregoing, CCP section 1989 does not prevent the Court from compelling Burman to appear for deposition in California.
3. Conclusion

Thus, the motion to compel Burman to appear for deposition is GRANTED.
C. Requests for Monetary Sanctions

1. Willow’s Request

Willow makes a code-compliant request for an award of monetary sanctions against GCV and its counsel in the amount of $3,790.
“If a motion under [CCP section 2025.450] is granted,” the court shall impose a monetary sanction “in favor of the party who noticed the deposition and against the deponent or party with whom the deponent is affiliated.” (CCP, § 2025.450, subd. (g)(1).) “On motion of any other party who, in person or by attorney, attended at the time and place specified in the deposition in the expectation that the deponent’s testimony would be taken, the court shall impose a monetary sanction . . . in favor of that party and against the deponent or party with whom the deponent is affiliated.” (Id., subd. (g)(2).) The court shall not impose a sanction if it finds that the one subject to the sanction acted with substantial justification or that other circumstances make the imposition of the sanction unjust. (Id., subd. (g).)

Willow’s motion is granted, and Willow presents evidence showing that its counsel attended Burman’s noticed deposition in expectation that Burman’s testimony would be taken. Since GCV and Burman did not serve written objections before the deposition or otherwise advise Willow that Burman would not appear, the Court finds that GCV and its counsel did not act with substantial justification, and no other circumstances would make the imposition of the sanction unjust. Therefore, an award of monetary sanctions against GCV and its counsel is warranted.
Willow’s counsel declares that Willow incurred $90 in filing and court reporter fees to bring the motion and $200 in court reporter fees for Burman’s deposition. (Willow’s counsel’s decl., ¶ 13 & Ex. 8.) Counsel further declares that Willow incurred $3,500 in attorney’s fees because he bills at $350 per hour, spent 5 hours meeting and conferring and an unspecified amount of time preparing the motion, and “expect[s] to spend” 5 hours in connection with the reply and the hearing. (Id., ¶ 13.)

The court awards sanctions only for reasonable expenses actually incurred, not for anticipated expenses. (Tucker v. Pacific Bell Mobile Services (2010) 186 Cal.App.4th 1548, 1551; CCP, § 2023.030, subd. (a).) Thus, the time counsel anticipated spending on the reply and at the hearing will not be included in the award. In addition, the time counsel spent “meeting and conferring” will not be included in the award because Willow was obligated to meet and confer before bringing this motion. (See CCP, § 2025.450, subd. (b)(2).) Furthermore, a request for an award of monetary sanctions must be accompanied by a declaration “setting forth facts supporting the amount of any monetary sanction sought.” (CCP, § 2023.040.) Since counsel has not declared how much time he spent preparing the moving papers, his declaration does not contain facts supporting an award of attorney’s fees for the preparation of the motion. That being said, the Court finds the fees incurred to file this motion ($90) and the court reporter fees incurred due to Burman’s nonappearance ($200) to be reasonable.

Accordingly, Willow’s request for an award of monetary sanctions against GCV and its counsel is GRANTED IN PART in the amount of $290.
2. GCV’s Request

GCV requests an award of monetary sanctions against Willow and its counsel in the amount of $4,250, and cites CCP section 2025.410 as authorizing such an award. However, that provision only authorizes an award of sanctions in connection with a motion to quash (CCP, § 2025.410, subd. (d)), not a motion to compel appearance at a deposition. Thus, GCV’s request is not code-compliant because it has not proffered a legal basis for the Court to award sanctions. Moreover, the statute that applies to requests for monetary sanctions in connection with motions to compel appearance at a deposition—CCP section 2025.450, subdivision (g)—does not authorize an award of sanctions in favor of a party that opposes a motion to compel appearance at a deposition. Therefore, no legal authority permits the Court to award monetary sanctions in favor of GCV.

GCV’s request for an award of monetary sanctions against Willow and its counsel is therefore DENIED.
IV. Conclusion

Willow’s request for judicial notice in support of the motion is GRANTED as to the existence of the records.

Willow’s motion to compel Burman to appear for deposition and provide oral testimony is GRANTED. Accordingly, within 30 calendar days of the date of the filing of this order, or on another mutually agreeable date, Burman shall appear for deposition at the location described in the deposition notice.

Willow’s request for an award of monetary sanctions against GCV and its counsel is GRANTED IN PART in the amount o
f $290. Accordingly, within 20 calendar days of the date of the filing of the order, GCV and its counsel shall pay $290 to Willow’s counsel.

GCV’s request for an award of monetary sanctions against Willow and its counsel is DENIED.