QED, LLC v. DCP Management, Inc., Yonekura CASE NO. 112CV220242
DATE: 6 June May 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 5 June 2014. Please specify the issue to be contested when calling the Court and counsel.

On 6 June 2014, the motion of Plaintiff or terminating, issue, evidence and/or monetary sanctions against Defendant Glen Yonekura for failure to comply with this Court’s lawful order of 14 February 2014 was argued and submitted.

Defendant did not file formal opposition to the motion. However, on the afternoon of 4 June 2014, this Court received a document entitled “Declaration of Charles J. Smith In Opposition to Request for Terminating Sanctions.” The document is not a true declaration since there is no statement under penalty of perjury.

Statement of Facts

This action arises from an alleged breach of a loan agreement. In the first amended complaint (“FAC”), Plaintiff alleges the following: Plaintiff loaned $450,000 to defendant DCP Management, Inc. (“DCP”) in 2007, but DCP defaulted on the loan in 2010. Defendant is the principal of DCP and other companies that are defendants in this action, including defendant Duke Capital Partners, Inc. (“Duke”). However, Defendant, DCP, Duke, and the other defendant companies are all alter egos of one another because Defendant failed to observe corporate formalities and maintain adequate corporate records, used his companies’ assets for his personal benefit, commingled corporate assets with his personal funds, and undercapitalized the companies. Plaintiff filed the FAC on 21 February 2013, asserting causes of action against all of the defendants for breach of contract.

On 10 January 2014, the motions of plaintiff QED, LLC (“Plaintiff”) to compel (1) further responses to special interrogatories (“SI”) and for monetary sanctions, and (2) further responses to requests for production of documents (“RPD”) and production in conformity therewith and for monetary sanctions were argued and submitted. Defendant Glen Yonekura (“Defendant”) filed papers in opposition to both motions.

In a lawful order of this Court dated 7 December 2012, this Court ordered that Defendant and his counsel pay the sum of $1000 to counsel for Plaintiff in connection with a discovery motion. That sum has still not yet been paid.

In a lawful Order of this Court dated 4 February 2014, Defendant was ordered, within 20 days, isto serve code-compliant further responses to SI Nos. 1-12 and 15-17, without objection. Defendant was further ordered to serve code-compliant further responses to RPD Nos. 9-39, without objection, and produce all responsive documents in conformity therewith. Finally, Defendant and his counsel were ordered to pay Plaintiff’s counsel $3,500.00.

The matter is now on its fourth trial setting conference, currently set for 24 June 2014.

Discovery Dispute

The present motion was filed on 8 May 2014.

On 24 February 2014, in an attempt to comply with the lawful order of this Court, Defendant Yonekura provided additional responses to the document requests and to the special interrogatories. Plaintiff contends that the responses are still not code compliant nor are they responsive.

Correspondence in the file confirms discussion between counsel about providing additional responses as well as extending the time within which to bring this motion.

Analysis

This motion is essentially unopposed as the statement in opposition to the motion states nothing more than that Mr. Smith has been in a jury trial since 12 May 2014. This date is after the 11 April 2014 date within which Defense Council promised to comply with the court order, and after the 11 May 2014 date by which Plaintiff was required to file this motion. The statement further states that the principal of Plaintiff is Defendant’s uncle by marriage. Finally, the statesman seems to claim that this litigation is being brought in bad faith.

Code of Civil Procedure, § 2030.290(c) states, in part: “If a party then fails to obey an order compelling answers [to interrogatories], 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, § 2030.300(c) states, in part: “If a party then fails to obey the order compelling a response, [to a request for production of documents] 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 this sanction, the court may impose a monetary sanction under Chapter 7 (commencing with Section 2023.010).”

The power to impose discovery sanctions is a broad discretion and subject to reversal only for arbitrary, capricious or whimsical action. Only two facts are absolutely prerequisite to imposition of the sanction: first, there must be a failure to comply and two) the failure must be willful. Vallbona v. Springer (1996) 43 Cal. App. 4th 1525, 1545. Where a party has repeatedly thwarted discovery and violated court orders, willfulness is established and nonmonetary sanctions are warranted. R.S. Creative, Inc. v. Creative Cotton, Ltd, (1999) 75 Cal. App. 4th 486, 496.

The request for terminating sanctions is GRANTED. The answer of Defendant Glen Yonekura is STRICKEN. Plaintiff may proceed to obtain a judgment by default against Defendant Glen Yonekura.

Sanctions

Code of Civil Procedure, § 2023.040 states: “A request for a sanction shall, in the notice of motion, identify every person, party, and attorney against whom the sanction is sought, and specify the type of sanction sought. The notice of motion shall be supported by a memorandum of points and authorities, and accompanied by a declaration setting forth facts supporting the amount of any monetary sanction sought.” See Rule of Court 2.30.

Plaintiff makes a request for the imposition of monetary sanctions in the amount of $4200. The request is code compliant. Defendant Glen Yonekura and his counsel are ordered to pay the sum of $4200 to counsel for Plaintiff within 20 days of the date of the filing of this Order.

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Order

The request for terminating sanctions is GRANTED. The answer of Defendant Glen Yonekura is STRICKEN. Plaintiff may proceed to obtain a judgment by default against Defendant Glen Yonekura.

Plaintiff makes a request for the imposition of monetary sanctions in the amount of $4200. The request is code compliant. Defendant Glen Yonekura and his counsel are ordered to pay the sum of $4200 to counsel for Plaintiff within 20 days of the date of the filing of this Order.