Preview
SUPERIOR COURT OF CALIFORNIA
COUNTY OF SANTA BARBARA
Dated and Entered: 01/06/2023 Time: 10:00 AM
Judicial Officer: Donna D Geck
Deputy Clerk: Kristi Temple Dept: SB Dept 4
Deputy Sheriff: Marco Diaz
Court Reporter: Michelle Sabado Case No: 20CV02113
Mark Schaub et al vs Andrew Wyles Waters et al
Parties Present:
Diane Bang Plaintiff’s Attorney
NATURE OF PROCEEDINGS: Motion: Order for Terminating Sanctions
The Court adopted the tentative ruling as follows:
RULING:
For the reasons set forth herein the motion of plaintiff Mark Schaub for terminating sanctions is granted.
Defendants’ answer is stricken, and default judgment shall be entered against defendants, jointly and
severally, and in favor of plaintiff in the amount of $1,590,000.00 plus pre-judgment interest at the rate of
seven percent per annum from the date of the filing of the complaint (June 23, 2020). Counsel for plaintiff
shall prepare the judgment.
Background:
On June 23, 2020, plaintiffs Mark Schaub and TLG Ltd. filed their original complaint in this action against
defendants Andrew Wyle Waters, FCP Corporate Ltd. (FCP Corporate), and FCP Private, LLC (FCP
Private).
On February 2, 2021, without any response having been filed by defendants, plaintiffs filed their first
amended complaint.
On April 1, 2021, defendants filed a demurrer and motion to strike as to the first amended complaint.
On June 14, 2021, plaintiffs filed their second amended complaint (SAC), which is the operative
pleading. The SAC alleges six causes of action: (1) conversion, (2) intentional misrepresentation—fraud;
(3) concealment; (4) breach of contract ($1,940,000); (5) breach of contract ($400,000); and (6) unjust
enrichment.
On July 30, 2021, defendants filed a demurrer and motion to strike as to the SAC.
On October 12, 2021, then-counsel for defendants filed their motion to be relieved as counsel. The
declaration filed in support of the motion identified a confidential but material breakdown in the attorney-
client relationship as the reason for the motion.
SC-2411 (Revised July 1, 2013) MINUTE ORDER
On October 25, 2021, defendants filed their answer to the SAC, generally denying the allegations thereof
and asserting nine affirmative defenses.
On October 29, 2021, plaintiff Schaub served his first sets of form interrogatories, requests for production
of documents, and requests for admissions on all three defendants. (Bang decl., ¶ 2.)
The deadline to respond to the discovery was extended to December 28, 2021, by stipulation. (Bang
decl., ¶ 3.)
On December 28, 2021, defendants served objections to Schaub’s written discovery and did not produce
any documents. (Bang decl., ¶ 4.)
On January 7, 2022, the court heard and granted the motion of defendant’s attorney to be relieved as
counsel. No other counsel has appeared on behalf of defendants. (Bang decl., ¶ 5.)
On February 15, 2022, Schaub filed a motion to compel further responses from FCP Corporate as to the
written discovery and for an award of monetary sanctions. The hearing was originally set for April 29,
2022, but it was continued by the court to May 6, 2022.
On May 6, 2022, the court continued the hearing to May 27, 2022. The motion was granted and FCP
Corporate was ordered to serve written responses to plaintiff’s first sets of form interrogatories, requests
for production of documents, and requests for admissions, without objection except as to privilege, on or
before June 13, 2022. Sanctions were awarded in the amount of $6,500.00 to be paid on or before June
13, 2022.
While the motion against FCP Corporate was pending, but before it was heard, Schaub filed virtually
identical motions to compel against defendants Waters and FCP Private. On August 12, 2022, at the
hearing on the motion, the court granted the motion to compel against Waters and FCP Private. They
were ordered to serve written responses to plaintiff’s first sets of form interrogatories, requests for
production of documents, and requests for admissions, without objection except as to privilege, on or
before August 29, 2022. Sanctions were awarded in the amount of $2,500.00 to be paid on or before
June 13, 2022.
FCP Corporate, FCP Private, and Waters have all failed to provide the ordered discovery responses or
monetary sanctions. (Bang decl., ¶¶ 6-7.)
On August 30, 2022, plaintiffs’ counsel sent the defendants a letter regarding defendants’ failure to
comply with the court’s orders granting the motions to compel further responses and informing them that
plaintiffs would be seeking terminating sanctions. (Bang decl., ¶ 8 & exhibit A.)
On September 13, 2022, Waters and plaintiffs’ counsel participated in a meet and confer call wherein
Waters gave no indication that any of the defendants intended on complying with the court’s orders or
participate in this litigation. (Bang decl., ¶ 9.)
Plaintiff filed and served the current motion for terminating sanctions on September 20, 2022, via mail
and electronic service.
No opposition or other response has been filed to the motion.
Analysis:
SC-2411 (Revised July 1, 2013) MINUTE ORDER
Schaub moves for terminating sanctions by striking defendants’ answer and entering a default judgment
against defendants in the amount of $1,590,000.00 plus prejudgment interest for failure to obey the
court’s orders compelling discovery responses and imposing sanctions.
Schaub requests that the court take judicial notice of (1) the second amended complaint filed on June
14, 2021, (2) defendants’ answer filed on October 25, 2021, (3) the order granting defendants’ prior
attorney’s motion to be relieved as counsel, (4) the order granting plaintiffs’ motion to compel further
responses to discovery against FCP Corporate, and (5) the order granting plaintiffs’ motion to compel
further response to discovery against Waters and FCP Private. The court will take judicial notice of all of
the documents pursuant to Evidence Code section 452, subdivision (d) as records of this court.
If a party “fails to obey an order compelling further responses 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.” (Code Civ. Proc., § 2030.300, subd. (e).)
If a party “fails to obey [an] order compelling a response [to a demand 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.” (Code Civ. Proc., § 2031.300, subd. (c).)
If a party “fails to obey an order compelling further responses to requests for admission, the court may
order that the matters involved in the requests be deemed admitted.” (Code Civ. Proc., § 2033.290,
subd. (e).)
“The trial court may order a terminating sanction for discovery abuse ‘after considering the totality of the
circumstances: [the] conduct of the party to determine if the actions were willful; the detriment to the
propounding party; and the number of formal and informal attempts to obtain the discovery.’ [Citation.]”
(Creed-21 v. City of Wildomar (2017) 18 Cal.App.5th 690, 702.)
“A decision to order terminating sanctions should not be made lightly. But where a violation is willful,
preceded by a history of abuse, and the evidence shows that less severe sanctions would not produce
compliance with the discovery rules, the trial court is justified in imposing the ultimate sanction.”
(Mileikowsky v. Tenet Healthsystem (2005) 128 Cal.App.4th 262, 279–280.)
In this case, plaintiffs have been unsuccessfully attempting to obtain discovery from defendants for over
a year. Defendants have willfully refused to comply with the orders compelling responses to discovery
and have failed to make any attempts to explain their failure to comply. This, in effect, has deprived
plaintiff of being able to adequately prepare for trial.
In Del Junco v. Hufnagel (2007) 150 Cal.App.4th 789, the court held that terminating sanctions were
warranted when it “became obvious” that a party had no intention of answering discovery or complying
with the judge’s orders. (Id., at p.p. 799-800.) Given that Waters provided no information in response to
previous discovery requests, produced no documents, has indicated that he does not intend to comply
with the court’s orders or participate in the litigation, and stated that plaintiffs “can go through all the
motions you want in the world” to get court orders (Bang decl., ¶ 9), it is obvious that he has no intention
of answering discovery or complying with the court’s orders. As such, terminating sanctions are
appropriate. No lesser alternatives would induce compliance.
The court may impose a terminating sanction by “[a]n order rendering a judgment by default against that
party.” (Code Civ. Proc., § 2023.030, subd. (d)(4).)
SC-2411 (Revised July 1, 2013) MINUTE ORDER
Defendants’ answer will be stricken, and default entered in favor of plaintiffs. Prejudgment interest
pursuant to Civil Code section 3287, subdivisions (b)-(c) will be awarded at the rate of seven percent per
annum from the time of the filing of plaintiff’s complaint.
DARREL E. PARKER, EXECUTIVE OFFICER Minutes Prepared by:
Kristi Temple , Deputy
SC-2411 (Revised July 1, 2013) MINUTE ORDER
Preview
SUPERIOR COURT OF CALIFORNIA COUNTY OF SANTA BARBARA Dated and Entered: 01/06/2023 Time: 10:00 AM Judicial Officer: Donna D Geck Deputy Clerk: Kristi Temple Dept: SB Dept 4 Deputy Sheriff: Marco Diaz Court Reporter: Michelle Sabado Case No: 20CV02113 Mark Schaub et al vs Andrew Wyles Waters et al Parties Present: Diane Bang Plaintiff’s Attorney NATURE OF PROCEEDINGS: Motion: Order for Terminating Sanctions The Court adopted the tentative ruling as follows: RULING: For the reasons set forth herein the motion of plaintiff Mark Schaub for terminating sanctions is granted. Defendants’ answer is stricken, and default judgment shall be entered against defendants, jointly and severally, and in favor of plaintiff in the amount of $1,590,000.00 plus pre-judgment interest at the rate of seven percent per annum from the date of the filing of the complaint (June 23, 2020). Counsel for plaintiff shall prepare the judgment. Background: On June 23, 2020, plaintiffs Mark Schaub and TLG Ltd. filed their original complaint in this action against defendants Andrew Wyle Waters, FCP Corporate Ltd. (FCP Corporate), and FCP Private, LLC (FCP Private). On February 2, 2021, without any response having been filed by defendants, plaintiffs filed their first amended complaint. On April 1, 2021, defendants filed a demurrer and motion to strike as to the first amended complaint. On June 14, 2021, plaintiffs filed their second amended complaint (SAC), which is the operative pleading. The SAC alleges six causes of action: (1) conversion, (2) intentional misrepresentation—fraud; (3) concealment; (4) breach of contract ($1,940,000); (5) breach of contract ($400,000); and (6) unjust enrichment. On July 30, 2021, defendants filed a demurrer and motion to strike as to the SAC. On October 12, 2021, then-counsel for defendants filed their motion to be relieved as counsel. The declaration filed in support of the motion identified a confidential but material breakdown in the attorney- client relationship as the reason for the motion. SC-2411 (Revised July 1, 2013) MINUTE ORDER On October 25, 2021, defendants filed their answer to the SAC, generally denying the allegations thereof and asserting nine affirmative defenses. On October 29, 2021, plaintiff Schaub served his first sets of form interrogatories, requests for production of documents, and requests for admissions on all three defendants. (Bang decl., ¶ 2.) The deadline to respond to the discovery was extended to December 28, 2021, by stipulation. (Bang decl., ¶ 3.) On December 28, 2021, defendants served objections to Schaub’s written discovery and did not produce any documents. (Bang decl., ¶ 4.) On January 7, 2022, the court heard and granted the motion of defendant’s attorney to be relieved as counsel. No other counsel has appeared on behalf of defendants. (Bang decl., ¶ 5.) On February 15, 2022, Schaub filed a motion to compel further responses from FCP Corporate as to the written discovery and for an award of monetary sanctions. The hearing was originally set for April 29, 2022, but it was continued by the court to May 6, 2022. On May 6, 2022, the court continued the hearing to May 27, 2022. The motion was granted and FCP Corporate was ordered to serve written responses to plaintiff’s first sets of form interrogatories, requests for production of documents, and requests for admissions, without objection except as to privilege, on or before June 13, 2022. Sanctions were awarded in the amount of $6,500.00 to be paid on or before June 13, 2022. While the motion against FCP Corporate was pending, but before it was heard, Schaub filed virtually identical motions to compel against defendants Waters and FCP Private. On August 12, 2022, at the hearing on the motion, the court granted the motion to compel against Waters and FCP Private. They were ordered to serve written responses to plaintiff’s first sets of form interrogatories, requests for production of documents, and requests for admissions, without objection except as to privilege, on or before August 29, 2022. Sanctions were awarded in the amount of $2,500.00 to be paid on or before June 13, 2022. FCP Corporate, FCP Private, and Waters have all failed to provide the ordered discovery responses or monetary sanctions. (Bang decl., ¶¶ 6-7.) On August 30, 2022, plaintiffs’ counsel sent the defendants a letter regarding defendants’ failure to comply with the court’s orders granting the motions to compel further responses and informing them that plaintiffs would be seeking terminating sanctions. (Bang decl., ¶ 8 & exhibit A.) On September 13, 2022, Waters and plaintiffs’ counsel participated in a meet and confer call wherein Waters gave no indication that any of the defendants intended on complying with the court’s orders or participate in this litigation. (Bang decl., ¶ 9.) Plaintiff filed and served the current motion for terminating sanctions on September 20, 2022, via mail and electronic service. No opposition or other response has been filed to the motion. Analysis: SC-2411 (Revised July 1, 2013) MINUTE ORDER Schaub moves for terminating sanctions by striking defendants’ answer and entering a default judgment against defendants in the amount of $1,590,000.00 plus prejudgment interest for failure to obey the court’s orders compelling discovery responses and imposing sanctions. Schaub requests that the court take judicial notice of (1) the second amended complaint filed on June 14, 2021, (2) defendants’ answer filed on October 25, 2021, (3) the order granting defendants’ prior attorney’s motion to be relieved as counsel, (4) the order granting plaintiffs’ motion to compel further responses to discovery against FCP Corporate, and (5) the order granting plaintiffs’ motion to compel further response to discovery against Waters and FCP Private. The court will take judicial notice of all of the documents pursuant to Evidence Code section 452, subdivision (d) as records of this court. If a party “fails to obey an order compelling further responses 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.” (Code Civ. Proc., § 2030.300, subd. (e).) If a party “fails to obey [an] order compelling a response [to a demand 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.” (Code Civ. Proc., § 2031.300, subd. (c).) If a party “fails to obey an order compelling further responses to requests for admission, the court may order that the matters involved in the requests be deemed admitted.” (Code Civ. Proc., § 2033.290, subd. (e).) “The trial court may order a terminating sanction for discovery abuse ‘after considering the totality of the circumstances: [the] conduct of the party to determine if the actions were willful; the detriment to the propounding party; and the number of formal and informal attempts to obtain the discovery.’ [Citation.]” (Creed-21 v. City of Wildomar (2017) 18 Cal.App.5th 690, 702.) “A decision to order terminating sanctions should not be made lightly. But where a violation is willful, preceded by a history of abuse, and the evidence shows that less severe sanctions would not produce compliance with the discovery rules, the trial court is justified in imposing the ultimate sanction.” (Mileikowsky v. Tenet Healthsystem (2005) 128 Cal.App.4th 262, 279–280.) In this case, plaintiffs have been unsuccessfully attempting to obtain discovery from defendants for over a year. Defendants have willfully refused to comply with the orders compelling responses to discovery and have failed to make any attempts to explain their failure to comply. This, in effect, has deprived plaintiff of being able to adequately prepare for trial. In Del Junco v. Hufnagel (2007) 150 Cal.App.4th 789, the court held that terminating sanctions were warranted when it “became obvious” that a party had no intention of answering discovery or complying with the judge’s orders. (Id., at p.p. 799-800.) Given that Waters provided no information in response to previous discovery requests, produced no documents, has indicated that he does not intend to comply with the court’s orders or participate in the litigation, and stated that plaintiffs “can go through all the motions you want in the world” to get court orders (Bang decl., ¶ 9), it is obvious that he has no intention of answering discovery or complying with the court’s orders. As such, terminating sanctions are appropriate. No lesser alternatives would induce compliance. The court may impose a terminating sanction by “[a]n order rendering a judgment by default against that party.” (Code Civ. Proc., § 2023.030, subd. (d)(4).) SC-2411 (Revised July 1, 2013) MINUTE ORDER Defendants’ answer will be stricken, and default entered in favor of plaintiffs. Prejudgment interest pursuant to Civil Code section 3287, subdivisions (b)-(c) will be awarded at the rate of seven percent per annum from the time of the filing of plaintiff’s complaint. DARREL E. PARKER, EXECUTIVE OFFICER Minutes Prepared by: Kristi Temple , Deputy SC-2411 (Revised July 1, 2013) MINUTE ORDER