Preview
DAVID J. MICLEAN (SBN 115098)
dmiclean@micleangleason.com
DANIELLE M. MIHALKANIN (SBN 271442)
dmihalkanin@micleangleason.com
MICLEAN GLEASON LLP FILED
411 Borel Avenue, Suite 310 SAN MATEO COUNTY
San Mateo, CA 94402
Telephone: (650) 684-1181 DEC 06 2019
Ce
Facsimile: (650) 684-1182
Attorneys for Defendant and Cross-Complainant
Solomon Sha
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SUPERIOR COURT OF THE STATE OF CALIFORNIA
10 COUNTY OF SAN MATEO
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SWEET PRODUCTION, INC., a California Case No. 18-CIV-03110
Corporation,
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Plaintiff, DEFENDANT SOLOMON SHA’S EX PARTE
14 NOTICE OF MOTION AND MOTION FOR
TERMINATING SANCTIONS AND
Vv.
15 MONETARY SANCTIONS AGAINST
PLAINTIFF SWEET PRODUCTION, INC.;
16 SOLOMON SHA, an individual; and DOES 1 to OR, FOR AN ORDER SHORTENING TIME
10, inclusive, AND RELIEF FROM CCP 2024.020(a)
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Defendants.
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Date: December 9, 2019
19 Time: 2:00 p.m.
Department: Law & Motion
20 SOLOMON SHA,
21 Cross-Complainant,
22 Vv.
ra ClV—o3110
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SWEET PRODUCTION, INC., a California Pee Application
corporation; SWEET EXPRESS; MING CHIN; 21
| HOO
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DOREEN CHIN; and ROES 1 through 10,
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26 Cross-Defendants.
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SHA SANCTIONS MOTION CASE NO. 18-CIV-03110
EX PARTEMOTION
TO ALL PARTIES AND THEIR COUNSEL OF RECORD: 1
Please take notice that on December 9, 2019, at 2:00 pa, or as soon as the matter may be heard
in the Law & Motion Department of this Court, located at 400 County Center, Redwood City,
California 94063, Defendant SOLOMON SHA (“Sha”) will and hereby does move this Court ex parte
pursuant to California Code of Civil Procedure sections 2023.010 and 2023.030, for terminating
sanctions and monetary sanctions against Plaintiff Sweet Production, Inc. (“SPI” or “Plaintiff”) for
misuse of the discovery process. In the event that the court is disinclined to grant this motion on an ex
parte basis, Sha moves this Court pursuant to California Rule of Court 3.1300(b) for an order
10 shortening time and relief from California Code of Civil Procedure Section 2024.020(a) so that the
11 matter may be heard by this as soon as possible in the Law & Motion Department or in any event prior
12 to the January 6, 2020 trial date.
13 Good cause exists for the Court to exercise its discretion and grant this relief on an ex parte
14 basis to ensure that Sha can obtain relief from SPI’s claims prior to the January 6, 2020 trial so that Sha
15 does not have to prepare for trial when Plaintiff has neither served nor responded to any discovery
16 requests, ever. There is exigency to have this matter heard today because hearings before this Court are
17 presently being scheduled early-February 2020, with the earliest available hearing now on February 5,
18 2020. This is not enough time to have the matter heard incompliance with the “15-days before trial”
19 rule under CCP 2024.020(a), as trial is presently scheduled for January 6, 2020, or to prevent Sha from
20 the costly exercise of preparing for trial. This Motion is made on the grounds that good cause exists for
21 terminating SPI’s claims in its complaint against Sha and imposing monetary sanctions against SPI, or
22 alternatively shortening time to have this matter heard on an already scheduled hearing date in this case
23 and providing relief from CCP 20204.020(a).
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24 SPI initiated litigation against Sha on June 18, 2018. Despite diligent efforts from Sha to
25 procure initial discovery responses from SPI, SPI deliberately and tactically chose not to respond to any
26 discovery and go radio silent to all forms of meet and confer and other communication. Instead, SPI
27 made a tactical decision to suddenly show up at the Mandatory Settlement Conference on June 5, 2019
28 and claim readiness for trial — trial by ambush. The parties thereafter stipulated to move the trial date
SHA SANCTIONS MOTION CASE NO. 18-CIV-03110
from June 17, 2019 to January 6, 2020, and SPI stipulated to produce documents. Despite the
stipulation setting the trial for next year, SPI opposed Sha’s motion to compel discovery, claiming
untimeliness because Sha did not have the hearing set before the “15 day before trial” discovery
hearing cutoff date under the original trial date. After discovery was reopened by court order on
September 13, 2019, SPI again went radio silent and refused to serve discovery responses. Now SPI is
in violation of the Court’s November 1, 2019 order compelling SPI to serve discovery responses. Sha
fears that if relief is not granted, Sha again will face a trial by ambush from SPI.
Judicial economy and fairness will be served by terminating SPI’s claims against Sha and
imposing monetary sanctions against SPI for discovery misuse. SPI will not be unduly prejudiced
10 because SPI has never been an active participant in litigation that it filed; SPI has never served any
11 discovery nor responded to any discovery from Sha. Pursuant to Code of Civil Procedure sections
12 2023.010 and 2023.030, on notice to the parties and an opportunity for hearing, the court may impose
13 terminating sanctions and monetary sanctions against anyone engaging in conduct that is a misuse of
14 the discovery process. Pursuant to California Rules of Court 3.1203, 3.1204, and 3.670(h)(3)(b) and
15 Local Civil Rule 3.19, the court may grant Sha’s requests ex parte or alternatively under California
16 Rule of Court 3.1300(b) on shortened time and with relief from CCP 20204.020(a). Should the Court
17 deny this Motion in its entirety, Sha will suffer severe prejudice and hardship.
18 This motion is based upon this notice of motion, the attached memorandum of points and
19 authorities, the previously filed declarations of David J. Miclean and Solomon Sha, the declaration of
20 Danielle Mihalkanin, the pleadings and records on file herein, and other such evidence and argument as
21 may be presented at or before the hearing on this Motion.
22 Notice of this Ex Parte Motion was provided to counsel of record for all parties in this action in
23 accordance with California Rules of Court 3.1203, 3.1204, and 3.670(h)(3)(b) and Local Civil Rule
24 3.19 in a letter sent by FedEx on December 5, 2019 that was delivered on Friday, December 6, 2019 at
25 9:48am. (See Declaration of Danielle M. Mihalkanin in Support of Sha’s Ex Parte Motion for
26 Terminating Sanctions (“Mihalkanin Declaration”), Ex. B.) As ofthe time of this filing, counsel for
27 SPI has not responded to this notice. (See Mihalkanin Declaration at § 6.)
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SHA SANCTIONS MOTION CASE No. 18-CIV-03110
Dated: December 9, 2019 Respectfully Submitted:
MICLEAN GLEASON LLP
David J. Miclean
Danielle M. Mihalkanin
Attorneys for Defendant and Cross-Complainant
SOLOMON SHA
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SHA SANCTIONS MOTION CASE No. 18-CIV-03110
MEMORANDUM OF POINTS AND AUTHORITIES
I. INTRODUCTION
Solomon Sha (“Sha”) has filed numerous motions against Sweet Production, Inc. (“SPI”)
related to SPI’s continued misuse of the discovery process and complete failure to comply with its
discovery obligations for more than a year and present violation of this Court’s November 1, 2019
order compelling discovery.! SPI continues to refuse to respond to any discovery at all, including the
first set of complete discovery (Requests for Production, Form Interrogatories, and Special
Interrogatories) that was properly served on July 27, 2018 and Sha’s Requests for Production of
Documents (Set Two) that was properly served on September 11, 2019. Sha has been forced to bring
10 motion after motion because SPI has refuses to respond to any discovery despite emerging in June 2019
11 to declare SPI trial-ready for a previously scheduled trial two weeks later. The parties stipulated and
12 the court moved the trial to January 6, 2020 to prevent a trial by ambush against Sha. Yet, SPI has
13 again gone radio silent and again seeks to avoid all discovery obligations until trial, which has been its
14 strategy all along.
15 In this motion, Sha seeks a Court Order under CCP 2023.010 and 2023.030 imposing
16 terminating sanctions to dismiss the action by SPI against Sha and monetary sanctions against SPI for
17 its complete misuse of the discovery process and court system, or in the alternative, for an order
18 shortening time to have this motion heard as soon as possible in the Law and Motion department and
19 for relief from CCP 2024.020(a) so that this motion may be heard before the January 6, 2020 trial date.
20 SPI should not be rewarded for its gameplaying and subterfuge and wholesale failure to participate in
21 discovery, meet-and-confer efforts, and Sha’s investigation of SPI’s frivolous claims against Sha. Sha,
22 who is a man of limited means, wrongfully terminated from his job and cut off from a company (and its
23 profits) that he owns, has been the victim of SPI and the Chins’ self-dealing and discovery abuse, and
24 has been forced to file multiple motions for relief. The only prejudice would be to Sha if this motion is
25 not granted in some form. Sha respectfully requests the Court grant Sha’s Motion.
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' The order compelling discovery responses was served on SPI on November 4, 2019 by mail service
28 with a courtesy copy by email. Mihalkanin Decl., Ex. A.
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Il. BACKGROUND
A SPI and the Chins Refuse to Provide Financial Data to Co-Owner Sha
Sha has worked in the bakery industry for over 20 years. [Declaration of Solomon Sha in
Support of Motion to Compel (February 13, 2019) (“Sha Decl.”), 43.] With Ming (a.k.a. “Terry”) Chin
and Doreen Chin in 2008, Sha began SPI, a commercial wholesale bakery. (Id.) Sha owned 30% of
SPI and served as SPI’s corporate secretary and managerial employee. (Jd.) However, during his time
with SPI, Sha did not realize the Chins were misappropriating SPI funds and profits — engorging only
themselves with SPI profit and other monetary distributions. (Sha Decl., 4.) When Sha suspected
financial malfeasance and sought answers, the Chins denied him information and terminated his
10 employment with SPI. (/d.)
11 David Miclean of Miclean Gleason LLP was retained by Sha in July 2017 to obtain financial
12 information from SPI. [Declaration of David J. Miclean in Support of Solomon Sha’s Motion for
13 Leave (July 5, 2019) (“Miclean Decl.”) { 4.] On August 10, 2017, Miclean wrote to SPI’s counsel,
14 Andrew Agtagma, to request an accounting of SPI’s books and records to determine the distribution
15 amounts owed to Sha. (/d.) Sha requested inspection of SPI’s financial documents pursuant to
16 statutory authority to understand why he had not received distributions as an officer and shareholder for
17 the time SPI had been in business, and because of his concern that substantial monies were taken out of
18 the business by the Chins. (Miclean Decl., Ex. 2.)
19 On August 25, 2017, SPI’s counsel responded to Miclean’s August 10, 2017 letter and offered
20 to make a limited number of financial documents available but refused to produce tax returns and any
21 financial reports or income statements prior to the 2017 fiscal year. (Miclean Decl. {| 5, Ex. 3.) On
22 September 12, 2017, Sha’s counsel emailed SPI’s counsel (Mr. Agtagma) and challenged SPI’s refusal
23 to produce accounting reports and tax records. (/d., Ex. 4.)
24 On November 15, 2017, Sha’s counsel again reached out to opposing counsel, Andrew
25 Agtagma, regarding SPI’s continued refusal to produce tax records for the previous 7 years to Sha.
26 (Miclean Decl. { 6, Ex. 5.)
27 On December 1, 2017, counsel for SPI allowed a limited inspection of documents on December
28 19, 2017, but continued to refuse Sha access to SPI corporate tax records despite the fact Sha was an
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owner and officer of SPI. (Miclean Decl. § 7, Ex. 6.) The inspection went forward in December 2017,
but SPI continued its refusal to produce documents that would show revenue expenditures, SPI tax
returns, and K-1s for the Chins. (/d.) In early 2018, Sha’s counsel continued to press SPI’s counsel
Andrew Agtagma for additional financial information from SPI. (Miclean Decl. { 8.) Since that time,
SPI had been wholly noncompliant with Sha’s request to produce records and financial data regarding
the company. (/d.) In May 2018, Sha’s counsel advised SPI’s counsel that if SPI did not provide the
financial information requested, litigation would likely ensue. But, rather than meeting Sha’s requests
for documentation, and in retaliation to avoid compliance, and as a preemptive strike, SPI filed a
Complaint against Sha on June 18, 2018 containing a litany of frivolous claims against Sha. (Id.)
10 B. SPI and the Chins Refuse to Participate in Discovery
11 On July 19, 2018, Sha’s counsel filed an answer to the SPI Complaint, as well as a Cross-
12 Complaint against SPI, Ming and Doreen Chin, and Sweet Express. (Miclean Decl. { 9, Ex. 7.) The
13 Cross-Complaint included causes of action for breach of fiduciary duty, accounting, fraud, conversion
14 and unjust enrichment against SPI, Doreen and Ming Chin as owners of SPI, and against Sweet
15 Express, the company affiliated with SPI and the Chins that diverted revenue away from SPI. (/d.) On
16 July 24, 2018, Sha’s counsel’s office emailed SPI counsel, Mr. Agtagma, asking if he would accept
17 service of the Cross-Complaint for Sweet Express and the Chins, in addition to his client SPI. (Miclean
18 Decl., Ex. 8.) When Mr. Agtagma failed to respond to Sha’s counsel’s email, Sha personally served
19 SPI, Sweet Express, Doreen Chin, and Ming Chin with the Cross-Complaint. (/d.) On July 27, 2018,
20 Sha personally served SPI with the First Set of Requests for Production of Documents, Special
21 Interrogatories, Form Interrogatories, and an Inspection Demand (Miclean Decl., Ex. 9) to gather
22 information for the purpose of defending Sha against SPI’s allegations in the complaint, prepare Sha’s
23 defenses, obtain discovery on issues in the case, and to assess potential damages. (Miclean Decl. { 10.)
24 SPI did not respond to any of these discovery requests. (/d.) On August 9, 2019, Sha personally served
25 Cross-Defendants Doreen Chin and Ming Chin with form interrogatories, special interrogatories, and
26 requests for production of documents. (Miclean Decl., Ex. 22.) The Chins did not respond to any of
27 these discovery requests. (/d.) On August 23, 2018, Sha personally served deposition notices on
28 Cross-Defendants Ming Chin and Doreen Chin. However, these depositions were taken off calendar
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due to Cross-Defendants’ refusal to comply with discovery and produce documents, and because
default was entered against the Chins (and the other Cross-Defendants) on the Cross-Complaint and,
later, the First Amended Cross-Complaint. (Miclean Decl. § 11.)
None of the Cross-Defendants responded to Sha’s Cross-Complaint. On September 4, 2018,
prior to entry of default, Sha’s counsel’s office sent a courtesy notice to Mr. Agtagma advising him that
SPI and the other Cross-Defendants were in default, and if they did not respond to the Cross-
Complaint, Sha would file a default. (Miclean Decl. § 12, Ex. 10.) Mr. Agtagma and Cross-
Defendants ignored Sha’s counsel courtesy notice and did not respond. A default was filed and entered
against Cross-Defendants Sweet Express, Doreen Chin, and Ming Chin on September 14, 2018, and as
10 to SPI on October 9, 2018. (Miclean Decl. { 12, Exs. 11-12.)
11 C. Sha Files a Motion to Compel
12 On February 8, 2019, in response to Cross-Defendants’ continued failure to provide any
13 responses to Sha’s discovery requests, Sha filed a Motion to Compel discovery compliance and served
14 it on the Cross-Defendants. (Miclean Decl., Ex. 16.) The Cross-Defendants failed to file or even serve
15 an opposition to the Motion to Compel. (Miclean Decl. 4 16.) On April 2, 2019, Sha’s February 8,
16 2019 Motion to Compel was denied (without prejudice) by Judge Greenberg due to Cross-Defendants
17 Sweet Express, Ming Chin, and Doreen Chin’s defaults having already been entered as to the Cross-
18 Complaint, and because the proof of service prepared by the filing service apparently failed to identify
19 Mr. Agtagma as SPI’s counsel — even though that information would certainly be known to the court
20 since he filed the original SPI complaint. (Miclean Decl. { 17, Ex. 17.)
21 On April 4, 2019, Sha filed a First Amended Cross-Complaint to explicitly make a demand for
22 $1.5 million in damages by reason of Cross-Defendants’ failure to pay ownership distributions and
23 conversion of Mr. Sha’s ownership interest in SPI. (Miclean Decl. 7 18.) The First Amended Cross-
24 Complaint (“FAC”) (like the original Cross-Complaint) included causes of action for breach of
25 fiduciary duty, accounting, fraud, conversion, and unjust enrichment against SPI, Doreen and Ming
26 Chin as owners of SPI, and against Sweet Express, the company affiliated with SPI and the Chins that
27 diverted revenue away from SPI. The amended cross-complaint was personally served on all Cross-
28 Defendants on April 9, 2019 and provided to Mr. Agtagma’s office ori April 16, 2019. Cross-
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Defendants’ responsive pleadings to the FAC were due on May 16, 2019. No response was filed by
any Cross-Defendant.
On April 16, 2019, SPI’s counsel, Andrew Agtagma, filed a Notice of Change of Address for
this matter with the Court. (Miclean Decl. 19.) This is the only contact Mr. Agtagma made with
Sha’s counsel from October 15, 2018, until June 4, 2019, a day before the parties’ Mandatory
Settlement Conference, a period of over 7 months. (Id.)
D Sha’s Second Motion to Compel
On May 17, 2019, Sha re-filed his Motion to Compel Discovery Responses from Plaintiff SPI,
Deeming Objections Waived, Monetary Sanctions, and Terminating Sanctions, which was originally
10 scheduled for hearing on June 12, 2019, but then continued by the court for hearing on July 2, 2019
ll (weeks after the trial date). (Miclean Decl. { 20.) Unfortunately, the motion was denied on July 2,
12 2019 as untimely since it was inadvertently set for hearing beyond the 15-day before trial discovery
13 motion cutoff in CCP 2024.020, and was not accompanied by the instant motion seeking leave under
14 CCP 2024.050 to have a discovery motion heard closer to the trial date. (Miclean Decl. { 24.)
15 E Sha Requests Entry of Default
16 On May 21, 2019, given Cross-Defendants’ total lack of response of any kind to Sha’s First
17 Amended Cross-Complaint, Sha filed a Request for Entry of Default on SPI, Sweet Express, Ming
18 Chin, and Doreen Chin as to the First Amended Cross-Complaint. The Default was entered as to Sweet
19 Production, Inc., Sweet Express, Ming Chin, and Doreen Chin on June 5, 2019. (Miclean Decl. { 21.)
20 Again, the default on the First Amended Cross-Complaint was personally served on all Cross-
21 Defendants and a copy provided to Mr. Agtagma at his new address.
22 E, SPI and the Chins’ Attempted Trial Sandbag
23 On June 5, 2019, there was a court-scheduled mandatory settlement conference followed by a
24 trial date scheduled for June 17, 2019. Having heard nothing substantively on any matter from SPI,
25 Mr. Agtagma, or any Cross-Defendant for over 9 months, Sha’s counsel contacted the court to move
26 the dates. The court declined, and Sha’s counsel prepared a timely MSC statement, which was served
27 on Mr. Agtagma on May 29, 2019. (Miclean Decl. [ 22.) Sha did not receive any MSC statement from
28 Mr. Agtagma on the due date. (/d.) But, on June 4, 2019, the night before the MSC, shortly before
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Sha’s counsel’s office closed, someone dropped off what purported to be an MSC statement from Mr.
Agtagma for SPI. (/d.) It was obvious that SPI and the other Cross-Defendants made a deliberate
decision to avoid any response to discovery or the Cross-Complaint, and planned to lie in wait and
attempt trial by ambush after SPI and Cross-Defendants’ total non-compliance with discovery and radio
silence for 9 months. It was also apparent that SPI and the Chins’ strategy was to try and wait Sha out
knowing he was an individual without substantial means and that it would be difficult for Sha to
prosecute the Cross-Complaint or fund the litigation. (/d.) On June 5, 2019, after Sha’s counsel made
objections to SPI and Mr. Agtagma’s abuse of discovery and attempt at trial by ambush, the Parties
stipulated to move the trial date to January 6, 2020 and SPI agreed to produce documents. (Mihalkanin
10 Decl., Ex. B.)
11 In over 35 years of legal practice, Sha’s counsel has never had a Plaintiff and Cross-Defendants
12 go radio silent and not communicate, not respond to cross-complaints, not respond to discovery, not
13 respond to meet and confer efforts on discovery, not respond to discovery motions, not respond to
14 courtesy notices of impending default, not respond to entries of default, not respond to communications
15 and emails, etc. — and despite personal service of all those pleadings, motions, and documents, and
16 service to SPI’s counsel of record — for almost 2 years. (Miclean Decl. § 27.) SPI has engaged in
17 wholesale discovery abuse.
18 G. The Court Re-Opened Discovery
19 On July 5, 2019, Sha sought relief from the court after SPI’s counsel refused to stipulate to
20 reopening discovery. Sha requested terminating sanctions or to reopen discovery. At court on August
21 28, 2019, the Court ordered discovery to be reopened pursuant to CCP 2024.050(a), but denied Sha’s
22 requests for sanctions. Sha then requested SPI comply with previously served discovery as well as
23 additional document requests served on September 11, 2019. (See Mihalkanin Decl., Ex. B.) SPI’s
24 counsel advised that SPI would respond and produce documents by October 11, 2019. (See Ex. B to
25 Mihalkanin Decl.) But, SPI again reneged on its discovery obligations and promises as nothing was
26 produced and no discovery responses were served by SPI.
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H. SPI Continues Its Refusal to Respond to Discovery Even After Order Compelling
Responses
SPI filed this case against Sha as a preemptive attack to avoid Sha’s requests for financial
information, and then refused to make any written response to discovery, produce any documents, or
respond to any interrogatories. SPI has consciously and willfully chosen to never respond to any of
Sha’s discovery requests dating back to July 27, 2018, and Sha would be severely prejudiced if SPI is
allowed to go to trial on its claims while engaging in discovery abuse to avoid Sha’s discovery of the
basis for SPI’s claims. In response to the November 1, 2019 court order compelling discovery
responses by November 10, 2019, SPI has still produced nothing. Mihalkanin Decl., 9. SPI is in
10 violation of this Court’s November 1, 2019 order. Trial in this case is currently scheduled to
ll commence January 6, 2020. The last day for Sha to bring motions per CCP § 2024.020(a) is December
12 23, 2019, but this Court is currently scheduling hearings out to the first week of February 2020.
13 Imposing terminating sanctions on an ex parte basis is the only way that Sha can avoid another trial by
14 ambush situation and avoid the costly exercise of having to prepare for trial. Imposing monetary
15 sanctions is the only way that Sha can be reimbursed for having to bring motion after motion to try to
16 get SPI to comply with its discovery obligations.
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18 IU. STATEMENT OF LAW
19 A court may impose “sanctions against anyone engaging in conduct that is a misuse of the
20 discovery process,” including monetary sanctions and terminating sanctions. (CCP § 2023.030; see also
21 Tucker v. Pac. Bell Mobile Servs., 186 Cal. App. 4th 1548, 1563, 115 Cal. Rptr. 3d 9, 19 (2010).)
22 Misuses of the discovery process include “[fJailing to respond or to submit to an authorized method of
23 discovery” and “[fJailing to confer in person, by telephone, or by letter with an opposing party or
24 attorney in a reasonable and good faith attempt to resolve informally any dispute concerning discovery.”
25 Code Civ. Proc. § 2023.010(d), (i). Where it is clear that a party has no intention of answering
26 discovery, filing proper and timely papers, or complying with court orders, terminating sanctions are
27 proper. See Del Junco v. Hufnagel, 150 Cal. App. 4th 789, 799, 60 Cal. Rptr. 3d 22, 29 (2007).
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IV. ARGUMENT
A SPI’s Tactical Refusal to Properly and Adequately Respond to the Discovery Is
Without Substantial Justification Thereby Warranting an Imposition of
Terminating Sanctions.
Code of Civil Procedure section 2023.030 authorizes the Court to impose monetary and
terminating sanctions against any party or attorney, or both, who has engaged in misuse of the discovery
process. Misuses of the discovery process include, among other things, failing to respond or to submit
to an authorized method of discovery, making, without substantial justification, an unmeritorious
objection to discovery, and failing to confer in person, by telephone, or by letter with an opposing party
10 or attorney in a reasonable and good faith attempt to resolve informally any dispute concerning
11 discovery. Code Civ. Proc. § 2023.010.
12 SPI’s deliberate and tactical refusal to respond to discovery and meet and confer on discovery
13 issues justifies a terminating sanction of its claims against Sha. SPI has refused to respond to the
14 Requests for Production of Documents, Special interrogatories, and Inspection Demand that Sha has
15 requested on multiple occasions and is now in violation of the November 1, 2019 court order compelling
16 discovery. (Nov. 1, 2019 Order Compelling Discovery Responses; and see Miclean Decl., { 21.)
17 Moreover, SPI has necessitated repeated Court intervention, which is contrary to the Discovery Act’s
18 purpose. Sinaiko Healthcare Consulting, Inc. v. Pac. Healthcare Consultants (2007) 148 Cal.App.4th
19 390, 402 (“Civil discovery is intended to operate with minimum judicial intervention. It is a central
20 precept of the Civil Discovery Act that Discovery be essentially self-executing.”) (internal citations
21 omitted). There is no reasonable justification for SPI’s bad faith in withholding discovery responses to
22 discovery and its refusal to meet and confer regarding the same. Accordingly, SPI must be sanctioned
23 for its willful misconduct.
24 1 Trial Cannot Proceed Without Discovery.
25 The necessity and reasons for Sha obtaining discovery from SPI in advance of trial are clear-cut,
26 and SPI should not be allowed to proceed to trial against Sha without ever having produced anything in
27 discovery. The purpose of discovery is “to enhance the truth-seeking function of the litigation process
28 and eliminate trial strategies that focus on gamesmanship and surprise.” Williams v. Volkswagenwerk
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Aktiengelsellschaft (1986) 180 Cal.App.3d 1244, 1254. “An important aspect of legitimate discovery
from a defendant’s point of view is the ascertainment, in advance of trial, of the specific components of
plaintiff's case so that appropriate preparation can be made to meet them.” Juarez v. Boy Scouts of
America, Inc. (2000) 81 Cal.App.4th 377, 389. Discovery is necessary to evaluate SPI’s claims and
prepare this matter for trial or settlement. Thus far, there is complete absence of any discovery response
by SPI, which is clear discovery misuse under CCP 2023.010 (d) and (i) (failing to respond or submit to
discovery and failing to meet and confer).
Sha has been the only party propounding discovery in this case. Sha sought discovery on both
SPI’s claims against him and his claims against SPI and the other Cross-Defendants, through Requests
10 for Production of Documents, Special Interrogatories, Form Interrogatories, an Inspection Demand,
11 deposition notices on SPI principals, meet and confer correspondences, and two unsuccessful Motions to
12 Compel. SPI did not respond to any of Sha’s discovery. Sha’s discovery requests were relevant to
13 investigate SPI’s allegations, prepare Sha’s defenses, and assess potential damage claims. Granting a
14 motion for terminating sanctions and monetary sanctions will allow Sha to avoid the specious SPI
15 claims against him for employee malfeasance and losing SPI customers (by terminating sanctions) or
16 finally get the information he requires to defend himself.
17 2 Sha Has Been Diligent in His Efforts to Complete Discovery and SPI is
18 Currently in Violation of this Court’s Order.
19 Sha has been diligent in his efforts to complete discovery. SPI filed its Complaint and initiated
20 litigation against Sha on June 18, 2018. On July 27, 2018, Sha propounded Requests for Production of
21 Documents, Special Interrogatories, Form Interrogatories, and an Inspection Demand on SPI through
22 SPI’s counsel at Mr. Agtagma’s mailing and email addresses. These were met with no response.
23 Further, on September 12, 2018, Sha also served deposition notice requests to SPI Principals, the Chins.
24 Again, SPI failed to respond. On October 15, 2018, SPI’s counsel finally responded with the notion of a
25 settlement, without any mention of discovery responses. Sha sought resolution to the entire matter and
26 was amicable for mediation. Sha agreed to mediation with the understanding that SPI would respond to
27 the discovery. Accordingly, Sha’s counsel set mediation for February 28, 2019.
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Sha’s counsel attempted numerous times to contact SPI’s counsel through telephone (SPI’s
counsel’s stated preferred method) to obtain discovery to make mediation discussions meaningful; SPI
yet again did not respond. This prompted Sha’s counsel to send a letter correspondence on November
29, 2018 to provide full and complete discovery responses by December 14, 2018. Despite this informal
measure taken by Sha, SPI once again fell silent.
Despite the parties initially agreeing to mediation, SPI went radio silent on all matters with no
response to any letter, email, discovery, mediator inquiry, or other communication. All the while, Sha
patiently waited for SPI’s response. Unable to obtain discovery to make mediation meaningful, Sha was
ultimately forced to cancel mediation. On February 15, 2019, Sha was forced to bring a Motion to
10 Compel Discovery Responses against SPI and the Chins. Consistent with their nonresponse, SPI never
11 filed any opposition to Sha’s motion. On May 17, 2019, Sha brought a renewed Motion to Compel
12 Discovery Responses. Although Sha was entitled to the discovery, unfortunately, both motions were
13 denied for non-substantive reasons, including that Sha’s counsel inadvertently filed the second motion
14 for hearing after the discovery motion cutoff date.
15 At court on June 5, 2019 when SPI attempted to sandbag Sha at trial, SPI stipulated and agreed
16 to produce documents within 45 days. No documents were ever produced. At court on August 28,
17 2019, the court ordered discovery to be reopened. On September 11, 2019, Sha then requested SPI
18 comply with previously served discovery as well as additional document requests by October 11, 2019.
19 Despite SPI’s counsel repeatedly confirming that it would respond to the discovery by October 11,
20 2019, SPI again reneged on its discovery obligations and promises as nothing was produced and no
21 discovery responses were ever served by SPI.
22 On November 1, 2019 Sha filed an ex parte application for a motion to compel discovery
23 responses after confirming that SPI would not oppose Sha’s motion. The court granted Sha’s motion
24 and SPI was ordered to serve discovery responses by November 10, 2019. To date, SPI has never
25 provided any responses and is presently in violation of the court’s November 1, 2019 order.
26 Mihalkanin Decl., 9.
27 Sha’s counsel has repeatedly made a reasonable and good faith attempt to meet and confer with
28 SPI’s Counsel and has sought court intervention as needed. But SPI’s counsel has never responded to
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any discovery. Sha’s counsel has been diligent in seeking discovery from SPI. The court should not
allow this case to be tried on the merits where SPI has engaged in discovery misuse to sandbag at trial
and prevent Sha from obtaining discovery from SPI on SPI’s claims.
B. SPI Must Be Sanctioned for Its Discovery Misconduct
SPI has refused to respond to any discovery, including the first set of requests for production of
documents, special interrogatories, form interrogatories, and inspection demand and second set of
requests for production that Sha has requested on multiple occasions (Mihalkanin Decl., Ex. B). For its
failure to respond and failure to provide responses, despite repeated requests, SPI should be sanctioned
for its discovery misconduct with both monetary and terminating sanctions.
10 Section 2023.030 authorizes a trial court to impose a monetary sanction and terminating
11 sanctions against any party or attorney, or both, who has engaged in misuse of the discovery process.
12 (CCP § 2023.030). Misuses of the discovery process include, among other things, failing to respond or
13 to submit to an authorized method of discovery; making, without substantial justification, an
14 unmeritorious objection to discovery; making an evasive response to discovery; and disobeying a court
15 order to provide discovery. (CCP § 2023.010.) “Ifa party fails to serve a timely response, and the
16 propounding party moves for and obtains a court order compelling a response, the trial court must
17 impose a monetary sanction against the delinquent party unless that party acted with ‘substantial
18 justification’ or the sanction would otherwise be unjust.” (Sinaiko Healthcare Consulting, Inc. v. Pac.
19 Healthcare Consultants (2007) 148 Cal. App. 4th 390, 404 (citing CCP §§ 2030.290(c), §2031.300(c).)
20 A court is not required to allow a party to continue to employ stalling tactics indefinitely. Liberty Mut.
21 Fire Ins. Co. v. LeL Adm’rs, Inc., 163 Cal. App. 4th 1093, 1106, 78 Cal. Rptr. 3d 200, 209 (2008).
22 Further, terminating sanctions are proper where a party tendered discovery responses that lacked
23 meaningful information, repeatedly ignored meet and confer letters, and propounded no discovery of its
24 own until faced with a motion for terminating sanctions. Jd.
25 As discussed above, SPI has been non-responsive, evasive, and has altogether refused to engage
26 in the discovery process, which has completely impaired Sha’s ability to defend himself against SPI’s
27
28
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unfounded claims.” Further, SPI has necessitated repeated Court intervention, which is and a waste of
this Court’s time and judicial resources. (See Sinaiko Healthcare Consulting, Inc. v. Pac. Healthcare
Consultants (2007) 148 Cal. App. 4th 390, 402 (“Civil discovery is intended to operate with a minimum
of judicial intervention. It is a ‘central precept’ of the Civil Discovery Act that discovery be essentially
self-executing”) (internal citations omitted)). The Court should not allow such discovery abuse and
SPI’s wholesale refusal to respond to discovery or engage in the discovery process. SPI has no
justification for its refusal to comply. Thus, Sha respectfully requests that SPI be sanctioned for not
only the costs associated with bringing this motion and the prior motion to compel (See Mihalkanin
Decl., Ex. B and § 8), but also by terminating SPI’s claims against Sha.
10 V. CONCLUSION
11 Sha respectfully requests the Court grant his motion to impose terminating and monetary
12 sanctions against SPI or to shorten time to have this matter heard before December 17, 2019, when Sha
13 is before this court for the Default Judgment on the cross-complaint.
14
15 Dated: December 9, 2019 Respectfully Submitted:
16 MICLEAN GLEASON LLP
17
18
David J. Miclean
19 Danielle M. Mihalkanin
20 Attorneys for Defendant and Cross-Complainant
SOLOMON SHA
21
22
23
24
2 SP] filed the Complaint against Sha because Sha sought full and complete review of SPI’s books and
25 records and SPI refused to produce a full accounting of such. Now that Sha seeks information to defend
himself against SPI’s unfounded claims, SPI continues to refuse to provide any information or discovery
26 responses to Sha. This repetitive conduct is the type that courts particularly find abusive. (See Liberty
27 Mut. Fire Ins. Co. v. LcL Adm’rs, Inc. (2008) 163 Cal. App. 4th 1093, 1104 (terminating sanctions were
proper where “Defendants chose to ignore the many attempts, both formal and informal, made by
28 plaintiff to secure fair responses from them”).)
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