2016-00204236-CU-CL

NCCS, Inc. vs. Carescope, LLC

Nature of Proceeding: Motion for Sanctions

Filed By: Levangie, Michael J.

Defendants Carescope, LLC and AJ3, LLC’s (collectively “Defendants”) motion for sanctions (CCP §128.7) is DENIED without prejudice.

The Court cannot and will not address the merits Defendants moving papers because it does not appear that Defendants strictly complied with the procedural prerequisites for bringing this motion.

Legal Standard

Code of Civil Procedure § 128.7(c)(1) provides a 21 day “safe harbor” period in which the motion for sanctions is served but not filed, to permit the opposing party an opportunity to withdraw or appropriately correct the challenged pleading.

Specifically, Section 128.7(c)(1) states that a notice of motion for sanctions

shall not be filed with or presented to the court unless, within 21 days after service of the motion, or any other period as the court may prescribe, the challenged paper, claim, defense, contention, allegation, or denial is not withdrawn or appropriately corrected.

(Code Civ. Proc. § 128.7(c)(1).)

Service of a formal noticed motion is required to begin the “safe harbor” period under Code of Civil Procedure § 128.7. That provision mandates that notices of motion shall be served as provided in Code of Civil Procedure § 1010. The incorporation of Section 1010 “is compulsory, not permissive.” (Galleria Plus, Inc. v. Hanmi Bank (2009) 179 Cal.App.4th 535, 538.) By specifically requiring service of the “motion” and “notice of motion,” the Legislature “made clear that the papers to be served on the opposing party are the same papers which are to be filed with the court no less than [21] days later.” (Hart v. Avetoom (2002) 95 Cal.App.4th 410, 414-415 (applying former version of statute providing for a 30-day safe-harbor and quoting Cromwell v. Cummings (1998) 65 Cal.App.4th Supp. 10, 14-15) (emphasis in Hart).) As such, “notice of an intent to seek sanctions in the future cannot serve as a substitute to the requirements set forth in section 128.7 for a formal noticed motion.” (Martorana v. Marlin & Saltzman (2009) 175 Cal.App.4th 685, 700 (quoting Barnes v. Department of Corrections (1999) 74 Cal.App.4th 126, 136).)

“Sanctions under section 128.7 are not designed to be punitive in nature but rather to promote compliance with the statutory standards of conduct.” (Id. (quoting Cromwell, 65 Cal.App.4th Supp. 10 at 14); Li v. Majestic Industry Hills LLC (2009) 177 Cal.App.4th 585, 591 (“By mandating a 21-day safe harbor period to allow correction or withdrawal of an offending document, section 128.7 is designed to be remedial, not punitive.”) “Because compliance with the safe harbor is a prerequisite to recovering sanctions, the burden is appropriately placed on the party seeking the sanctions to ensure the full safe harbor is provided.” (Li, 177 Cal.App.4th at 594 [emphasis added].) “[T]he safe harbor period is mandatory and the full 21 days must be provided.” (Id. at 595.) “Adequate notice prior to the imposition of sanctions is not only mandated by statute, but also by the due process clauses of the state and federal Constitutions.” (Martorana, 175 Cal.App.4th at 700 (holding that “[t]he notice requirements of section 128.7, subdivision (c)(1) [are] therefore mandatory, and neither the parties nor the trial court in this matter were permitted to disregard them.”).)

Accordingly, “[a]pplication of the doctrine of substantial compliance would be inconsistent with the plain language of the ‘safe harbor’ provision, which has been strictly construed as an absolute prerequisite to an award of sanctions . . . .” ( Cromwell, 65 Cal.App.4th Supp. 10 at 14-15 (explaining that Rule 11 of the Federal Rules of Civil Procedure serves as a model for Code of Civil Procedure § 128.7 and rejecting argument that “substantial compliance” should permit the filing of a sanctions motion “only 3 days” after service of the motion).) “‘Close’ is good enough in horseshoes and hand grenades, but not in the context of the sanctions statute.” (Hart, 95 Cal.App.4th at 414-15.)

Background

Here, the “First Amended Notice of Motion” was filed and served on December 18, 2017. To comply with CCP § 128.7(c)(1), the motion must be served, but may not be filed within 21 days after service of the motion.

Plaintiff Northern California Collection Service, Inc. (“Plaintiff”) objects to the motion because Defendants purportedly filed a “different motion than was

served.” (Opposition, 5:1.) Plaintiff indicates that it was personally served on November 16, 2017 with a set of papers that noticed a hearing date of January 3, 2018. (Opposition, 5:3-5.) Although no motion had yet been filed with the Court,

Plaintiff filed an objection that the motion was not timely filed. On December 18, 2017, Defendants filed the instant motion, identified as the “First Amended Notice of Motion and Motion for Sanctions. Plaintiff states that the First Amended Motion is not the same as the one served in November.

In reply, Defendants claim that they complied with the 21 day safe harbor provision. They explain that the only change between the original motion served and the First Amended Motion is the hearing date. (Reply, 4:11-12.) They further state that “the First Amended Notice of Motion along with another copy of the exact same moving papers as was served on November 16, 2017, was served again on December 18, 2017, with the only change being the new hearing date.” (Reply, 4:12-15.)

Defendants, however, fail to support the argument in reply with any evidence. Defendants’ counsel fails to aver to such facts, nor is there a copy of the first papers served, or a copy of the proof of service of the first papers.

Although Plaintiff also did not provide a copy of the original papers or a declaration averring that the original papers were different, it is Defendants’ burden to show that the full safe harbor was provided. (Li, 177 Cal.App.4th at 594.) Because Defendants fail to satisfy their burden, the motion for sanctions is DENIED without prejudice