Preview
1 Kimberly Pallen (SBN 288605)
kimberly.pallen@withersworldwide.com
2 Christopher N. LaVigne (NYBN 4811121) ELECTRONICALLY
(admitted Pro Hac Vice)
3 christopher.lavigne@withersworldwide.com F I L E D
Superior Court of California,
Withers Bergman LLP County of San Francisco
4 505 Sansome Street, 2nd Floor
San Francisco, California 94111 08/18/2021
Clerk of the Court
5 Telephone: 415.872.3200 BY: EDNALEEN ALEGRE
Facsimile: 415.549 2480 Deputy Clerk
6
Attorneys for Defendants Payward, Inc., a
7 California Corporation d/b/a Kraken; and Kaiser
NG, an individual
8
9 SUPERIOR COURT OF THE STATE OF CALIFORNIA
10 COUNTY OF SAN FRANCISCO
11
12 NATHAN PETER RUNYON, an individual, Case No. CGC-19-581099
13 Plaintiff, DEFENDANTS’ OPPOSITION TO
PLAINTIFF’S NOTICE AND MOTION
14 v. TO COMPEL FURTHER RESPONSES
FROM PAYWARD, INC. TO
15 PAYWARD, INC., a California Corporation SUPPLEMENTAL REQUESTS FOR
d/b/a KRAKEN; and Kaiser NG, an PRODUCTION OF DOCUMENTS AND
16 individual; and DOES 1 through 50, inclusive, PRIVILEGE LOG
17 Defendants. Filed Concurrently with: Declaration of
Kimberly A. Pallen; Defendants’ Response to
18 Plaintiff’s Separate Statement to Compel
Further Responses
19
Date: August 30, 2021
20 Time: 9:00 a.m.
Dept.: 302
21
The Hon. Ethan P. Schulman
22
Action Filed: November 26, 2019
23 Trial Date: September 13, 2021
24
25
26
27
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NY28571/0001-US-9748081/2
W ITHERS
B ERGMAN LLP OPPOSITION REPLY TO PLAINTIFF’S MOTION TO COMPEL FURTHER RESPONSES TO SUPPLEMENTAL
REQUESTS FOR PRODUCTION OF DOCUMENTS AND PRIVILEGE LOG
1 I. INTRODUCTION
2 Defendants Payward, Inc., and Kaiser Ng have been defending themselves against Plaintiff
3 Nathan Peter Runyon’s allegations of fraud for two years, in multiple forums. This case is finally
4 near completion. Defendants’ motion for summary adjudication will be heard on August 19, 2021,
5 and trial is set for September 13, 2021. Payward has unequivocally defeated Plaintiff’s exact same
6 fraud claims asserted by Runyon’s counsel, Claire Cochran, in another forum. Ms. Cochran is
7 therefore painfully aware that she and Plaintiff continue to assert meritless, and frivolous, fraud
8 claims in this action. Instead of dropping these claims, Plaintiff and his counsel have decided a better
9 tactic was to move to compel additional discovery on the eve of trial, a year and half after discovery
10 commenced, and days before Defendants’ Reply memorandum in support of summary adjudication
11 was due on August 6, 2021. As is typical of Plaintiff’s counsel, she seeks sanctions, which she has
12 at every turn in this case. In reality, Plaintiff and Ms. Cochran should be sanctioned, as they have
13 lied to this Court and to a AAA-appointed arbitrator about documents they repeatedly withheld in
14 this case, and now have forced Defendants to respond to a motion to compel documents relevant to
15 fraud claims that an arbitrator has determined were completely fabricated and were known to be
16 false at the time they were made.
17 Plaintiff’s motion to compel is completely meritless. First, he claims the documents he seeks
18 are “vital” to his case. However, the Google documents he seeks, and the privilege log entries he
19 complains of, are all related to fraud claims that have been defeated and that he apparently abandons
20 in his motion to compel. The only claims Plaintiff mentions in his “summary of relevant facts” are
21 his claims that he was retaliated against and terminated because of his disabilities. The Google
22 documents and privilege log entries he complains of have nothing to do with those claims.
23 Moreover, Payward has already produced one of these Google documents, and informed Plaintiff’s
24 counsel of this.
25 The same is true for Mr. Ng’s entire DocuSign history. Simply put, Payward has no
26 documents responsive to this request, and Ms. Cochran knows that. During the parties’ meet and
27 confer concerning this request, Payward pointed out to Ms. Cochran that she never made any attempt
28 to justify the relevance and scope of her demand for Mr. Ng’s entire DocuSign history. Mr. Ng has
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OPPOSITION TO PLAINTIFF’S MOTION TO COMPEL FURTHER RESPONSES TO SUPPLEMENTAL
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1 been the CFO of Payward for almost five years. Runyon’s fraud claim, which, again, has been
2 completely disproven, relates to certain employee vesting schedules that Runyon claims Mr. Ng
3 fraudulently altered in mid-2019. Furthermore, Payward explained and Ms. Cochran knows that her
4 request for this history is not accurate. Runyon took copies of Payward’s attorney-client
5 communications with its outside counsel, which show that the June 30, 2019 Payward board consent
6 that Ms. Cochran claims this request is relevant to was (1) not signed by Mr. Runyon and (2) was
7 sent to Payward’s board, and ultimately approved by the board, via email, not Docusign. Ms.
8 Cochran knows this not only because Payward explained it to her, but because Runyon,
9 unbeknownst to Defendants, provided her with those privileged communications, which Ms.
10 Cochran then tried to show Mr. Ng during his deposition in an attempt to trick Mr. Ng into waiving
11 Payward’s privilege. Ms. Cochran’s rendition of the facts justifying production of this document
12 deliberately ignores this uncomfortable truth in attempt to gloss over the fact that she violated
13 California law and ethics rules. Indeed, other than listing this history among the documents she
14 desires from Payward, she does nothing to justify its production.
15 Second, Plaintiff’s complaints about Defendants’ privilege log produced in 2020 are
16 untimely and meritless. Defendants conferred with Plaintiff’s counsel in November and December
17 of 2020, as well as in January of 2021, regarding her complaints concerning Defendants’ privilege
18 log. During that meet and confer, Defendants’ counsel explained to Ms. Cochran’s colleague, Maya
19 Sorensen, that all of the entries she questioned reflected unsigned drafts of Board documents sent to
20 our client by its then-lawyers. Defendants’ counsel conferred again with Ms. Sorensen on this issue
21 in February 2021 and informed her that Plaintiff’s time to file a motion to compel pertaining to any
22 privilege logs had expired, and if she wanted to file a motion to compel, Payward would oppose it
23 on that basis, among others. Plaintiff never filed a motion to compel. Plaintiff’s motion to compel
24 on this issue is therefore time-barred. Regardless, the entries at issue in this motion are indeed
25 privileged drafts of Board consents for which Payward has provided all the information necessary
26 to evaluate its privilege assertions.
27 Third, the remainder of the documents sought by Runyon either are completely vague and
28 therefore unidentifiable, do not exist, or are documents outside of Payward’s control. All of this is
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1 known to Plaintiff and his counsel. Accordingly, Plaintiff’s motion to compel should be denied in
2 its entirety and Defendants should be awarded costs of opposing the motion.
3 II. FACTS
4 Plaintiff initiated this lawsuit on Thanksgiving Eve 2019. His conveniently-timed complaint
5 accused Payward of harassing and discriminating against him on the basis of his veteran status and
6 disabilities. (Declaration of Kimberly Pallen In Support of Opposition to Plaintiff’s Notice and
7 Motion to Compel (“Pallen Decl.”) Ex. A, First Amended Complaint.) First Amended Complaint.
8 He also alleged that Payward retaliated against him for, among other things, reporting a purported
9 scheme orchestrated by Mr. Ng to defraud Payward employees out of stock options.
10 A. Discovery Thus Far
11 Runyon first served discovery requests in February 2020. See Declaration of Kimberly
12 Pallen In Support of Opposition to Plaintiff’s Notice and Motion to Compel (“Pallen Decl.”) Ex. B.)
13 Since then the parties have engaged in extensive discovery. As Plaintiff acknowledges, Payward has
14 scoured its records and produced thousands of documents, totaling more than 7,000 pages. (Id. ¶ 5.)
15 Runyon has produced only a single PDF consisting of over 1,000 pages that contains no metadata.
16 (Id.) Most of the documents in that PDF are Payward documents, including screenshots of a
17 privileged email conversation between Payward and its outside counsel. (Id.) Furthermore, Runyon
18 only produced those documents after hiding for almost a year and a half that Runyon possessed
19 Payward flash drives full of Payward documents. (Id.) Runyon alerted Payward to the existence of
20 these documents on the evening before his deposition in this case, and then spent two weeks filing
21 frivolous and bad faith motions, including for the appointment of a groundwater rights’ special
22 master, in an attempt to delay production of these documents and insulate his counsel from any
23 wrongdoing. (Id.) This Court rejected those repeated motions out of hand. (Id.)
24 The parties have conducted five fact depositions. Payward was only able to secure the
25 deposition testimony of the main witness in this case – referred to as “Employee 5” in Runyon’s
26 FAC – after successfully moving to compel her deposition after Ms. Cochran repeatedly refuse to
27 allow that witness to testify. (Id. ¶ 6.)
28 B. Plaintiff’s False Fraud Claims
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1 Runyon’s primary fraud claim is that he uncovered a scheme by Payward’s CFO, Kaiser Ng,
2 to defraud employees out of stock options. (Id. ¶ 7.) Runyon’s main allegations regarding this
3 scheme are that a November 2017 written board consent set forth a 4-year vesting schedule for
4 “Employee 5” (former Payward employee Connie Wong), yet Mr. Ng input a 6-year vesting
5 schedule for Ms. Wong in the company’s cap table management system. (Id., Ex. A.)
6 Payward has proven these allegations false. The day he was terminated, Runyon called Ms.
7 Wong, convinced her she was entitled to a 4-year vesting schedule (by discussing the contents of
8 the confidential November 2017 board consent) and therefore entitled to exercise additional options,
9 and convinced her to sue Payward and Mr. Ng for defrauding her out of those additional options.
10 ((Id. ¶ 8; Ex. C.) In February 2020, Ms. Wong, also represented by Ms. Cochran, threatened to sue
11 Payward in San Francisco Superior Court on the exact vesting schedule fraud claims asserted by
12 Mr. Runyon. (Id. ¶ 9; Ex. D.) Ms. Cochran threatened to sue publicly on Ms. Wong’s claims, despite
13 knowing that Ms. Wong was subject to a binding arbitration agreement. (Id. ¶ 10) Accordingly,
14 Payward was forced to file an arbitration demand to enforce that agreement. (Id.; Ex. E.)
15 After a two-day merits hearing in April 2021, the AAA-appointed arbitrator denied all of
16 Ms. Wong’s claims and granted Payward’s breach of contract claim. (Id. ¶11; Ex. F.) The arbitrator
17 issued a Final Award on August 2, 2021, which was included in Payward’s publicly-filed petition
18 to confirm the Final Award. (Id. ¶ 12; Ex. G.) Specifically, the arbitrator found that Ms. Wong’s
19 fraud claims, which are based on the exact same allegations Runyon makes in the instant case, are
20 (1) totally without merit (e.g., Id. ¶ 13, Ex. F at 7 (“There is zero evidence on which this Arbitrator
21 could conclude that the Board actually intended to grant a four-year vesting schedule to Ms.
22 Wong.”)) and (2) based on allegations that were known to be false (to both Wong and Runyon) at
23 the time they were made. (See id., Ex. F at 2, n.1 (“The evidence presented at the Arbitration Hearing
24 by Ms. Wong was markedly different from the facts alleged in her Amended Demand for Arbitration
25 filed June 24, 2020. Particularly striking are that the Amended Demand misstated facts underlying
26 her claim of fraudulent inducement that should have been known personally to Ms. Wong as being
27 false as of the date of the Amended Demand.”).)
28 Despite this unequivocal ruling, Ms. Cochran and Mr. Runyon have continued to assert these
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1 same exact fraud claims and arguments against Payward in this case. These claims are entirely
2 devoid of merit and are the definition of frivolous. (Id. Ex. F at 9, n.5 (“The factual bases for Ms.
3 Wong’s fraud claim . . . , moreover, were not proven, and were in fact contradicted by Ms. Wong’s
4 own testimony.”).)
5 C. Plaintiff’s Remaining Claims
6 Payward filed its motion for summary adjudication in this case on May 27, 2021. (Id. ¶ 17;
7 Ex. H.) A hearing on this motion is scheduled for Thursday, August 19, 2021. (Id.) In light of that
8 motion, Runyon dropped several of his discrimination-related claims. The remaining claims at issue
9 in the summary judgment motion include Payward’s failure to accommodate Runyon’s alleged
10 request for medical leave and Runyon’s fraud claims. (Id.) Trial in the State Case is set for
11 September 13, 2021. (Id.) Fact discovery is closed. (Id.)
12 D. Plaintiff’s Supplemental Discovery Requests and Payward’s Responses
13 On May 28, 2021, Plaintiff served supplemental document requests on Payward. (Id. ¶ 18;
14 Ex. I.) Payward responded to those requests on July 8, 2021. (Id. ¶ 19; Ex. J.) On July 16, 2021,
15 Plaintiff sent a meet and confer correspondence to Payward regarding Payward’s objections and
16 responses. (Id. ¶ 20; Ex. K.) On July 19, 2021, Payward produced documents in response to these
17 supplemental requests. (Id. ¶ 21; Ex. L.) Payward responded to Plaintiff’s July 16 letter on July 25,
18 2021. (Id.)
19 III. ARGUMENT
20 A. The Motion to Compel Should be Denied Outright Because Plaintiff’s Separate
Statement Fails to Comply with California Court Rules
21
The Court should deny this motion on the basis that the separate statement does not comply
22
with California Rule of Court 3.1345(c). See Mills v. U.S. Bank (2008) 166 Cal. App. 4th 871, 893
23
(denying plaintiff’s motion to compel because it “did not set forth the full response to each of the
24
discovery requests” as required CRC 3.1345(c).) Similar to the separate statement submitted in
25
Mills, Runyon does not provide Payward’s responses to the requests purportedly at issue. Rather,
26
like in Mills, Runyon’s “separate statement repeatedly grouped together several discovery requests,
27
and the section setting forth a statement of the factual and legal reasons for compelling further
28
responses . . . was extremely confusing because it did not indicate which of the specific discovery
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1 requests the various factual and legal reasons related to, and thus did not fulfill the requirement that
2 the statement address the factual and legal reasons for compelling ‘each mater in dispute.’” Ibid.
3 This violates the portion of CRC 3.1345 that states that “[t]he separate statement must be full and
4 complete so that no person is required to review any other document in order to determine the full
5 request and the full response.” The appellate court in Mills held as follows: “We conclude that
6 because Plaintiffs did not comply with the requirements of [CRC 3.1345], the trial court was well
7 within its discretion to deny the motion to compel discovery on that basis.” Mills, 166 Cal. App. 4th
8 at 893.
9 B. Plaintiff’s Requests for Documents Related to His False and Disproven Fraud Claims
Are Irrelevant, and Solely Meant to Harass Payward
10
Plaintiff’s request for certain Google spreadsheets and Mr. Ng’s entire DocuSign history,
11
along with his complaints regarding entries on Payward’s privilege log, represent nothing more than
12
Plaintiff’s last-ditch effort to harass Payward. CCP § 2023.010(c) (“Misuses of the discovery
13
process include . . . Employing a discovery method in a manner or to an extent that causes
14
unwarranted annoyance, embarrassment, or oppression, or undue burden and expense.”). These
15
documents are irrelevant to Plaintiff’s remaining claims, and he does nothing to justify these
16
requests. Indeed, Plaintiff’s “summary of relevant facts” only reference his few remaining disability
17
claims, and do not mention his vesting-schedule fraud claim.
18
And with good reason: the purported main witness to and victim of the fraud alleged by
19
Runyon is also represented by Ms. Cochran and sued on these same allegations – that Mr. Ng
20
intentionally defrauded her out of additional shares by changing her vesting schedule from four
21
years to six years in Payward’s cap table management system. (Pallen Decl. ¶ 7, Ex. 6.) However,
22
as Ms. Cochran well knows, the AAA arbitrator hearing that dispute denied this claim, finding it
23
was based on false allegations and contradicted by Ms. Wong’s own testimony, and “every
24
document signed by Ms. Wong and Payward[, which] reflect[] the six-year schedule.” (Id. at 7.)
25
When asked how these additional documents demanded by Runyon are relevant at all to this issue
26
in light of the undisputed facts in this case, Ms. Cochran never responded. (Id. ¶ 13.)
27
This is particularly true for Mr. Ng’s DocuSign history. Payward specifically asked Ms.
28
Cochran how Mr. Ng’s entire DocuSign history is relevant when (1) his allegations of fraud relating
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1 to Payward’s Board have been disproven, (2) his fraud allegations are extremely limited in scope
2 and involve at most two unanimous board consents, (3) Mr. Ng never signed any board consents,
3 and (4) in many cases, such as with the approval for the June 30, 2019, Board consent, Mr. Ng.
4 simply secured approval by Board members via email, not DocuSign.1 Confronted with these facts,
5 Ms. Cochran simply did not respond, and instead filed the instant motion weeks later, and on the
6 eve of Payward’s deadline to file its reply in support of summary judgment.
7 For these reasons alone, Runyon’s motion to compel these documents and privilege log
8 entries related to his disproven fraud claim should be denied. See Nelson v. Superior Ct. (1986) 184
9 Cal. App. 3d 444, 452-53 (“Plaintiff made no showing whatever of any use for the reports other than
10 his speculation that after examining the reports he might be able to formulate some viable theory of
11 liability.”).
12 C. The Google Documents Sought By Runyon Are Either Included In Payward’s Existing
Production or Are Non-Responsive
13
However, Runyon’s motion to compel documents and additional information is meritless for
14
a host of different and practical reasons.
15
1. The Google Document Referenced in PAYWARD004792 – PAYWARD004793 Is,
16 As Repeatedly Stated By Payward, A Privileged Draft Board Consent That Appears
on Payward’s Privilege Log
17
Ms. Cochran claims that Payward must produce this document in response to Runyon’s
18
Request No. 72. (Pallen Decl., Ex. L.) However, Payward properly responded that it had “already
19
produced responsive and non-privileged documents in its possession, custody and control
20
responsive to this Request.” (Id.) As Payward has explained multiple times to Ms. Cochran and her
21
associate Ms. Sorensen this document is a privileged draft Board document that was withheld on
22
privilege grounds and appears in Payward’s August 19, 2020, Supplemental Privilege Log. Indeed,
23
24
1
Ms. Cochran was well aware of this last fact, as she was provided by Runyon, without Payward’s knowledge, a privileged email
25 between Payward and its counsel regarding a draft of this June 30, 2019 Board consent. Payward became aware that Runyon
possessed this document when Ms. Cochran showed the privilege documents to Mr. Ng during his deposition in a surprise attempt
26 to get him to waive Payward’s privilege. (Pallen Decl. ¶15.) When confronted about this tactic, Ms. Cochran conceded the
document was privileged. (Id.) This was a clear violation of Ms. Cochran’s legal and ethical obligations. See Clark v. Superior
27 Ct. (2011) 125 Cal. Rptr. 3d 361, 374 (upholding attorney disqualification where the record reflected “evidence from which a
trial court could have concluded [that the lawyer] affirmatively used some of the substantive information contained in the
28 privileged documents to question witnesses or to support [a party]'s claims”).
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1 the email attaching this document, and the document itself, appear on lines 634 and 635,
2 respectively, of the privilege log. (Id. Ex. M.)2
3 2. Payward Has Produced All Documents It Could Locate Responsive to Runyon’s
Request No. 71
4
Ms. Cochran claims this document is purportedly responsive to Runyon’s Request No. 71.
5
(Id. Ex. K.) That request seeks documents “created by Mr. Runyon tracking country codes and
6
related OPEC data.” (Plaintiff’s Sep. Stmt. at 3:7-9.) Payward responded to this request that it would
7
produce “any additional responsive, non-privileged documents” it was “able to locate after a diligent
8
search and reasonable inquiry.” (Pallen Decl. Ex. L.) After performing this search, Payward was
9
unable to locate any additional responsive documents, including the Google document reference in
10
PAYWARD005166.
11
First, Payward possess no documents reflecting that Mr. Runyon tracked “related OPEC
12
data.” Payward, nor Mr. Runyon, were in any involved with tracking data regarding the
13
Organization of the Petroleum Exporting Countries. Second, Payward is unable to confirm whether
14
this Google document, while linked to Mr. Christie by Runyon, was in fact created by Mr. Runyon.
15
Third, assuming Ms. Cochran meant to seek documents created by Runyon tracking related “OFAC”
16
data, neither this document nor any document possessed by Payward reflects that Mr. Runyon was
17
tracking OFAC data. Indeed, as both Mr. Christie and Mr. Ng testified, Mr. Runyon never raised
18
any OFAC related concerns. (Id. Exs. N.) Mr. Runyon himself confirmed that the Slack message
19
produced as PAYWARD005166 do not reflect that he was tracking or reporting any OFAC related
20
data. (Id. Ex. P.)
21
Ms. Cochran does not dispute this. Instead she simply states, without any support at all, that
22
23 2
Although ultimately irrelevant to this inquiry, it is worth noting that Ms. Cochran is very aware that her argument that this
document is somehow vital to her case, and that it would somehow prove vesting schedules “were not awarded in line with the
24 Board’s vote on the matter,” is completely false. As noted above, she and Mr. Runyon possess a copy of this privileged draft
Board consent and it does nothing to prove Mr. Runyon’s case. Instead, it confirms Payward’s, and the arbitrator’s, view that the
25 fraud Runyon complains of was nothing more than a correctable mistake. (Id. Ex. 6 at 5-6 (“The uncontested testimony was that
the Board did take steps in June 2019 to correct the errors as to the vesting schedule of . . . other employees whose options were
26 to vest over four years and not six years as stated in the 2017 Unanimous Written Consent. The Board has not, however, to date
corrected the error affecting Ms. Wong and others whose options, according to their employment documents, were to vest over
27 six years.”). Furthermore, because this document is a draft board document, and there has been no documents or testimony
indicating Runyon was ever involved in drafting actual board documents, Payward is unable to determine whether this document
28 was “created by Mr. Runyon” and therefore whether this document is responsive to Request No. 72. (See Plaintiff’s Sep. Stmt. at
2:22-24.) Indeed, as Ms. Cochran is aware, Payward’s lawyers were the ones who drafted Payward’s Board documents.
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1 this particular document will reflect “concerns the Plaintiff brought up regarding Payward’s
2 operations and inability to receive revenue from certain countries.” (Mot. to Compel at 8.) This
3 unsupported lawyer argument presents no evidence making this wishful thinking true. Richard
4 Strick, M.D., Inc. v. United Ret. Plan Consultants, Inc., No. 2:16-cv-08206-AFM, 2018 WL
5 6004529, at *4 (C.D. Cal. July 13, 2018) (“[I]t is insufficient for Plaintiffs merely to present a
6 lawyer’s argument without evidence.”); Nelson, 184 Cal. App. 3d at 452-53. And as illustrated
7 directly above, this argument is simply not true.
8 For these reasons, Plaintiff’s motion to compel production of the Google document
9 referenced in PAYWARD005166 should be denied.
10 D. Plaintiff is Time Barred From Compelling Additional Information Regarding
Payward’s Privilege Log
11
As explained to Ms. Cochran (Pallen Decl. Ex. L), her concerns regarding Payward’s August
12
19, 2020, privilege log are untimely and have been resolved with Ms. Cochran’s colleague, Ms.
13
Sorensen. From November 2020 to February 2021, Payward’s counsel corresponded with Ms.
14
Sorensen about entries on the privilege log that she claimed were not privileged. Payward’s counsel
15
explained to her that all of the entries she questioned were drafts of Board minutes sent to our client
16
by its then-lawyers, or that reflected legal advice from outside counsel. Furthermore, Payward’s
17
counsel informed Ms. Sorensen in February 2021 that Mr. Runyon’s time to file a motion to compel
18
pertaining to any privilege logs had expired, and if he wanted to file a motion to compel, Payward
19
would oppose it on that basis, among others. (Id.) Runyon never filed a motion to compel. Therefore,
20
he is time barred from moving to compel at this late stage. See CCP § 2031.310(c).
21
Regardless, as Payward’s counsel told Ms. Sorensen, the privilege log entries Mr. Runyon
22
complains of in his motion (rows 629 – 636) are indeed drafts of Board consents and are, as such,
23
privileged. For Ms. Cochran to ignore this and raise the entries again nine months after Ms. Sorensen
24
raised them, and at the close of discovery, smacks of mal-intent. Ms. Cochran’s statement that
25
“Defendants have repeatedly failed” to provide additional information about these privilege log
26
entries (Plaintiff’s Sep. Stmt. at 7) is completely disingenuous.3 Payward has explained that these
27
28 3
Ms. Cochran makes numerous unsupported and completely false statements in the motion to compel and separate statement.
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1 entries reflect privilege draft board documents and privileged communications attaching those board
2 documents. (Supra Section III.C.1.)
3 Moreover, Ms. Cochran does not challenge Payward’s assertion of privilege over these draft
4 board documents. Instead, Ms. Cochran appears to argue that Payward has waived its attorney-client
5 privilege wholesale. (Plaintiff’s Sep. Stmt. at 6.) This is the first Payward is hearing of this argument.
6 Regardless, the notion that Payward conducted some pre-litigation internal investigation, has put
7 the adequacy of that investigation at issue, or took ameliorative action based on that investigation is
8 invented from whole cloth. Cf. Wellpoint Health Networks, Inc. v. Superior Court (1997) 59 Cal.
9 App. 4th 110. Instead, this is a typical litigation; when Runyon filed this lawsuit, Payward hired
10 undersigned counsel and undertook to gather facts and defend itself. Nothing in this standard
11 scenario suggests any privilege was waived. Additionally, Ms. Cochran appears to argue in the
12 improper separate statement that Payward’s entire privilege log is inadequate. (Id. at 5-6.) This is
13 wholly improper. Ms. Cochran’s sole meet and confer letter on this issue identified only specific
14 entries 630-636 on the privilege log that she wanted additional information for. Again, Payward has
15 repeatedly explained what these entries are. To the extent Ms. Cochran is now challenging
16 Payward’s entire privilege log, the motion to compel must be denied because she failed to meet and
17 confer with Payward about this challenge.
18 E. The Motion to Compel the Remaining Documents Must be Denied Because Runyon
Failed to Meet and Confer About These Documents and These Documents are Either
19 Too Vague to Identify or Do Not Exist
20 Plaintiff’s motion to compel Payward’s alleged “Employee Handbook,” “Performance
21 Reviews,” and “Performance Improvement Plan” (Mot. to Compel at 4) must be denied outright
22 because Plaintiff never met and conferred with Payward about these documents. CCP § 2023.010(i).
23 Furthermore, regardless of the outcome of the motion to compel, Defendants should be granted
24 monetary sanctions for Plaintiff’s failure to meet and confer regarding production of these
25 documents. CCP § 2023.020.
26
27 For example, she claims “Plaintiff has identified several redactions/exemptions from production made by Defendant which it
claims were made on the grounds of privilege, however, Defendants offer no explanation how the document is privileged. The
Defendant has large areas of redaction in documents that are key to this litigation but fails to give justification as to the nature of
28 the redactions.” This is simply not true. Plaintiff’s counsel has not identified any such redactions, and she cites nothing in the
record to indicate she has.
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B ERGMAN LLP
OPPOSITION TO PLAINTIFF’S MOTION TO COMPEL FURTHER RESPONSES TO SUPPLEMENTAL
REQUESTS FOR PRODUCTION OF DOCUMENTS AND PRIVILEGE LOG
1 Additionally, these documents are completely vague and do not exist. Had Ms. Cochran met
2 and conferred with Payward prior to making this motion, she would know this. Payward does not
3 have, and never has had, an employee handbook. Mr. Runyon testified as to the existence of a
4 Payward employee handbook, but when questioned about this after his deposition testimony, Mr.
5 Runyon revealed he was referring to a handbook offered by Payward’s third-party payroll company,
6 TriNet. Had Ms. Cochran conferred with Payward about this, it would have directed to her to seek
7 this document from third-party TriNet. However, in an abundance of caution, Payward has
8 downloaded a copy of TriNet’s “Worksite Employee Handbook,” and has produced it to Plaintiff.
9 Payward is unclear what Ms. Cochran is referring to when she references “Performance
10 Reviews.” As Payward made clear in its reply in support of its motion for summary adjudication,
11 Mr. Ng provided written and verbal reviews of Mr. Runyon’s work. Payward has produced all of
12 these written reviews to Mr. Runyon.
13 Lastly, it is unclear what Ms. Cochran is referring to when she refers to a “Performance
14 Improvement Plan.” Ms. Cochran questioned Mr. Ng about this, and Mr. Ng testified that is not
15 “aware of any individual receiving a performance improvement plan.” (Id. Ex. O.)
16 For these reasons, Plaintiff’s motion to compel these vague additional documents should be
17 denied.
18 F. Defendants Are Entitled to Sanctions
19 Substantial justification exists to deny the sanctions requested by Runyon. Conversely,
20 Payward should be granted sanctions for being forced to respond to a motion that misuses the
21 discovery process. See CCP § 2023.010(h) (“Misuses of the discovery process include, but are not
22 limited to, the following .. . [m]aking . .. unsuccessfully and without substantial justification, a
23 motion to compel . . .discovery.”). First, the Separate Statement is wholly non-conforming and does
24 not follow the clear rules set out in California Rule of Court 3.1345(c); Mills, 166 Cal. App. 4th at
25 893 (denying plaintiff’s motion to compel because it “did not set forth the full response to each of
26 the discovery requests” as required CRC 3.1345(c).) In addition, while both the motion and the
27 separate statement speak to purported issues with Payward’s privilege logs, neither provides
28 examples of redacted documents that it believes were wrongfully withheld. Moreover, the only
W ITHERS NY28571/0001-US-9748081/2 11
B ERGMAN LLP
OPPOSITION TO PLAINTIFF’S MOTION TO COMPEL FURTHER RESPONSES TO SUPPLEMENTAL
REQUESTS FOR PRODUCTION OF DOCUMENTS AND PRIVILEGE LOG
1 privilege log rows mentioned in the Motion have been addressed by Payward in the meet and confer
2 process; Payward has made clear that those documents are drafts of Board consent documents and
3 are, in fact, privileged. (See Pallen Decl., Ex. L.) Finally, Runyon claims that Payward refused to
4 prod
Preview
1 Kimberly Pallen (SBN 288605) kimberly.pallen@withersworldwide.com 2 Christopher N. LaVigne (NYBN 4811121) ELECTRONICALLY (admitted Pro Hac Vice) 3 christopher.lavigne@withersworldwide.com F I L E D Superior Court of California, Withers Bergman LLP County of San Francisco 4 505 Sansome Street, 2nd Floor San Francisco, California 94111 08/18/2021 Clerk of the Court 5 Telephone: 415.872.3200 BY: EDNALEEN ALEGRE Facsimile: 415.549 2480 Deputy Clerk 6 Attorneys for Defendants Payward, Inc., a 7 California Corporation d/b/a Kraken; and Kaiser NG, an individual 8 9 SUPERIOR COURT OF THE STATE OF CALIFORNIA 10 COUNTY OF SAN FRANCISCO 11 12 NATHAN PETER RUNYON, an individual, Case No. CGC-19-581099 13 Plaintiff, DEFENDANTS’ OPPOSITION TO PLAINTIFF’S NOTICE AND MOTION 14 v. TO COMPEL FURTHER RESPONSES FROM PAYWARD, INC. TO 15 PAYWARD, INC., a California Corporation SUPPLEMENTAL REQUESTS FOR d/b/a KRAKEN; and Kaiser NG, an PRODUCTION OF DOCUMENTS AND 16 individual; and DOES 1 through 50, inclusive, PRIVILEGE LOG 17 Defendants. Filed Concurrently with: Declaration of Kimberly A. Pallen; Defendants’ Response to 18 Plaintiff’s Separate Statement to Compel Further Responses 19 Date: August 30, 2021 20 Time: 9:00 a.m. Dept.: 302 21 The Hon. Ethan P. Schulman 22 Action Filed: November 26, 2019 23 Trial Date: September 13, 2021 24 25 26 27 28 NY28571/0001-US-9748081/2 W ITHERS B ERGMAN LLP OPPOSITION REPLY TO PLAINTIFF’S MOTION TO COMPEL FURTHER RESPONSES TO SUPPLEMENTAL REQUESTS FOR PRODUCTION OF DOCUMENTS AND PRIVILEGE LOG 1 I. INTRODUCTION 2 Defendants Payward, Inc., and Kaiser Ng have been defending themselves against Plaintiff 3 Nathan Peter Runyon’s allegations of fraud for two years, in multiple forums. This case is finally 4 near completion. Defendants’ motion for summary adjudication will be heard on August 19, 2021, 5 and trial is set for September 13, 2021. Payward has unequivocally defeated Plaintiff’s exact same 6 fraud claims asserted by Runyon’s counsel, Claire Cochran, in another forum. Ms. Cochran is 7 therefore painfully aware that she and Plaintiff continue to assert meritless, and frivolous, fraud 8 claims in this action. Instead of dropping these claims, Plaintiff and his counsel have decided a better 9 tactic was to move to compel additional discovery on the eve of trial, a year and half after discovery 10 commenced, and days before Defendants’ Reply memorandum in support of summary adjudication 11 was due on August 6, 2021. As is typical of Plaintiff’s counsel, she seeks sanctions, which she has 12 at every turn in this case. In reality, Plaintiff and Ms. Cochran should be sanctioned, as they have 13 lied to this Court and to a AAA-appointed arbitrator about documents they repeatedly withheld in 14 this case, and now have forced Defendants to respond to a motion to compel documents relevant to 15 fraud claims that an arbitrator has determined were completely fabricated and were known to be 16 false at the time they were made. 17 Plaintiff’s motion to compel is completely meritless. First, he claims the documents he seeks 18 are “vital” to his case. However, the Google documents he seeks, and the privilege log entries he 19 complains of, are all related to fraud claims that have been defeated and that he apparently abandons 20 in his motion to compel. The only claims Plaintiff mentions in his “summary of relevant facts” are 21 his claims that he was retaliated against and terminated because of his disabilities. The Google 22 documents and privilege log entries he complains of have nothing to do with those claims. 23 Moreover, Payward has already produced one of these Google documents, and informed Plaintiff’s 24 counsel of this. 25 The same is true for Mr. Ng’s entire DocuSign history. Simply put, Payward has no 26 documents responsive to this request, and Ms. Cochran knows that. During the parties’ meet and 27 confer concerning this request, Payward pointed out to Ms. Cochran that she never made any attempt 28 to justify the relevance and scope of her demand for Mr. Ng’s entire DocuSign history. Mr. Ng has W ITHERS NY28571/0001-US-9748081/2 1 B ERGMAN LLP OPPOSITION TO PLAINTIFF’S MOTION TO COMPEL FURTHER RESPONSES TO SUPPLEMENTAL REQUESTS FOR PRODUCTION OF DOCUMENTS AND PRIVILEGE LOG 1 been the CFO of Payward for almost five years. Runyon’s fraud claim, which, again, has been 2 completely disproven, relates to certain employee vesting schedules that Runyon claims Mr. Ng 3 fraudulently altered in mid-2019. Furthermore, Payward explained and Ms. Cochran knows that her 4 request for this history is not accurate. Runyon took copies of Payward’s attorney-client 5 communications with its outside counsel, which show that the June 30, 2019 Payward board consent 6 that Ms. Cochran claims this request is relevant to was (1) not signed by Mr. Runyon and (2) was 7 sent to Payward’s board, and ultimately approved by the board, via email, not Docusign. Ms. 8 Cochran knows this not only because Payward explained it to her, but because Runyon, 9 unbeknownst to Defendants, provided her with those privileged communications, which Ms. 10 Cochran then tried to show Mr. Ng during his deposition in an attempt to trick Mr. Ng into waiving 11 Payward’s privilege. Ms. Cochran’s rendition of the facts justifying production of this document 12 deliberately ignores this uncomfortable truth in attempt to gloss over the fact that she violated 13 California law and ethics rules. Indeed, other than listing this history among the documents she 14 desires from Payward, she does nothing to justify its production. 15 Second, Plaintiff’s complaints about Defendants’ privilege log produced in 2020 are 16 untimely and meritless. Defendants conferred with Plaintiff’s counsel in November and December 17 of 2020, as well as in January of 2021, regarding her complaints concerning Defendants’ privilege 18 log. During that meet and confer, Defendants’ counsel explained to Ms. Cochran’s colleague, Maya 19 Sorensen, that all of the entries she questioned reflected unsigned drafts of Board documents sent to 20 our client by its then-lawyers. Defendants’ counsel conferred again with Ms. Sorensen on this issue 21 in February 2021 and informed her that Plaintiff’s time to file a motion to compel pertaining to any 22 privilege logs had expired, and if she wanted to file a motion to compel, Payward would oppose it 23 on that basis, among others. Plaintiff never filed a motion to compel. Plaintiff’s motion to compel 24 on this issue is therefore time-barred. Regardless, the entries at issue in this motion are indeed 25 privileged drafts of Board consents for which Payward has provided all the information necessary 26 to evaluate its privilege assertions. 27 Third, the remainder of the documents sought by Runyon either are completely vague and 28 therefore unidentifiable, do not exist, or are documents outside of Payward’s control. All of this is W ITHERS NY28571/0001-US-9748081/2 2 B ERGMAN LLP OPPOSITION TO PLAINTIFF’S MOTION TO COMPEL FURTHER RESPONSES TO SUPPLEMENTAL REQUESTS FOR PRODUCTION OF DOCUMENTS AND PRIVILEGE LOG 1 known to Plaintiff and his counsel. Accordingly, Plaintiff’s motion to compel should be denied in 2 its entirety and Defendants should be awarded costs of opposing the motion. 3 II. FACTS 4 Plaintiff initiated this lawsuit on Thanksgiving Eve 2019. His conveniently-timed complaint 5 accused Payward of harassing and discriminating against him on the basis of his veteran status and 6 disabilities. (Declaration of Kimberly Pallen In Support of Opposition to Plaintiff’s Notice and 7 Motion to Compel (“Pallen Decl.”) Ex. A, First Amended Complaint.) First Amended Complaint. 8 He also alleged that Payward retaliated against him for, among other things, reporting a purported 9 scheme orchestrated by Mr. Ng to defraud Payward employees out of stock options. 10 A. Discovery Thus Far 11 Runyon first served discovery requests in February 2020. See Declaration of Kimberly 12 Pallen In Support of Opposition to Plaintiff’s Notice and Motion to Compel (“Pallen Decl.”) Ex. B.) 13 Since then the parties have engaged in extensive discovery. As Plaintiff acknowledges, Payward has 14 scoured its records and produced thousands of documents, totaling more than 7,000 pages. (Id. ¶ 5.) 15 Runyon has produced only a single PDF consisting of over 1,000 pages that contains no metadata. 16 (Id.) Most of the documents in that PDF are Payward documents, including screenshots of a 17 privileged email conversation between Payward and its outside counsel. (Id.) Furthermore, Runyon 18 only produced those documents after hiding for almost a year and a half that Runyon possessed 19 Payward flash drives full of Payward documents. (Id.) Runyon alerted Payward to the existence of 20 these documents on the evening before his deposition in this case, and then spent two weeks filing 21 frivolous and bad faith motions, including for the appointment of a groundwater rights’ special 22 master, in an attempt to delay production of these documents and insulate his counsel from any 23 wrongdoing. (Id.) This Court rejected those repeated motions out of hand. (Id.) 24 The parties have conducted five fact depositions. Payward was only able to secure the 25 deposition testimony of the main witness in this case – referred to as “Employee 5” in Runyon’s 26 FAC – after successfully moving to compel her deposition after Ms. Cochran repeatedly refuse to 27 allow that witness to testify. (Id. ¶ 6.) 28 B. Plaintiff’s False Fraud Claims W ITHERS NY28571/0001-US-9748081/2 3 B ERGMAN LLP OPPOSITION TO PLAINTIFF’S MOTION TO COMPEL FURTHER RESPONSES TO SUPPLEMENTAL REQUESTS FOR PRODUCTION OF DOCUMENTS AND PRIVILEGE LOG 1 Runyon’s primary fraud claim is that he uncovered a scheme by Payward’s CFO, Kaiser Ng, 2 to defraud employees out of stock options. (Id. ¶ 7.) Runyon’s main allegations regarding this 3 scheme are that a November 2017 written board consent set forth a 4-year vesting schedule for 4 “Employee 5” (former Payward employee Connie Wong), yet Mr. Ng input a 6-year vesting 5 schedule for Ms. Wong in the company’s cap table management system. (Id., Ex. A.) 6 Payward has proven these allegations false. The day he was terminated, Runyon called Ms. 7 Wong, convinced her she was entitled to a 4-year vesting schedule (by discussing the contents of 8 the confidential November 2017 board consent) and therefore entitled to exercise additional options, 9 and convinced her to sue Payward and Mr. Ng for defrauding her out of those additional options. 10 ((Id. ¶ 8; Ex. C.) In February 2020, Ms. Wong, also represented by Ms. Cochran, threatened to sue 11 Payward in San Francisco Superior Court on the exact vesting schedule fraud claims asserted by 12 Mr. Runyon. (Id. ¶ 9; Ex. D.) Ms. Cochran threatened to sue publicly on Ms. Wong’s claims, despite 13 knowing that Ms. Wong was subject to a binding arbitration agreement. (Id. ¶ 10) Accordingly, 14 Payward was forced to file an arbitration demand to enforce that agreement. (Id.; Ex. E.) 15 After a two-day merits hearing in April 2021, the AAA-appointed arbitrator denied all of 16 Ms. Wong’s claims and granted Payward’s breach of contract claim. (Id. ¶11; Ex. F.) The arbitrator 17 issued a Final Award on August 2, 2021, which was included in Payward’s publicly-filed petition 18 to confirm the Final Award. (Id. ¶ 12; Ex. G.) Specifically, the arbitrator found that Ms. Wong’s 19 fraud claims, which are based on the exact same allegations Runyon makes in the instant case, are 20 (1) totally without merit (e.g., Id. ¶ 13, Ex. F at 7 (“There is zero evidence on which this Arbitrator 21 could conclude that the Board actually intended to grant a four-year vesting schedule to Ms. 22 Wong.”)) and (2) based on allegations that were known to be false (to both Wong and Runyon) at 23 the time they were made. (See id., Ex. F at 2, n.1 (“The evidence presented at the Arbitration Hearing 24 by Ms. Wong was markedly different from the facts alleged in her Amended Demand for Arbitration 25 filed June 24, 2020. Particularly striking are that the Amended Demand misstated facts underlying 26 her claim of fraudulent inducement that should have been known personally to Ms. Wong as being 27 false as of the date of the Amended Demand.”).) 28 Despite this unequivocal ruling, Ms. Cochran and Mr. Runyon have continued to assert these W ITHERS NY28571/0001-US-9748081/2 4 B ERGMAN LLP OPPOSITION TO PLAINTIFF’S MOTION TO COMPEL FURTHER RESPONSES TO SUPPLEMENTAL REQUESTS FOR PRODUCTION OF DOCUMENTS AND PRIVILEGE LOG 1 same exact fraud claims and arguments against Payward in this case. These claims are entirely 2 devoid of merit and are the definition of frivolous. (Id. Ex. F at 9, n.5 (“The factual bases for Ms. 3 Wong’s fraud claim . . . , moreover, were not proven, and were in fact contradicted by Ms. Wong’s 4 own testimony.”).) 5 C. Plaintiff’s Remaining Claims 6 Payward filed its motion for summary adjudication in this case on May 27, 2021. (Id. ¶ 17; 7 Ex. H.) A hearing on this motion is scheduled for Thursday, August 19, 2021. (Id.) In light of that 8 motion, Runyon dropped several of his discrimination-related claims. The remaining claims at issue 9 in the summary judgment motion include Payward’s failure to accommodate Runyon’s alleged 10 request for medical leave and Runyon’s fraud claims. (Id.) Trial in the State Case is set for 11 September 13, 2021. (Id.) Fact discovery is closed. (Id.) 12 D. Plaintiff’s Supplemental Discovery Requests and Payward’s Responses 13 On May 28, 2021, Plaintiff served supplemental document requests on Payward. (Id. ¶ 18; 14 Ex. I.) Payward responded to those requests on July 8, 2021. (Id. ¶ 19; Ex. J.) On July 16, 2021, 15 Plaintiff sent a meet and confer correspondence to Payward regarding Payward’s objections and 16 responses. (Id. ¶ 20; Ex. K.) On July 19, 2021, Payward produced documents in response to these 17 supplemental requests. (Id. ¶ 21; Ex. L.) Payward responded to Plaintiff’s July 16 letter on July 25, 18 2021. (Id.) 19 III. ARGUMENT 20 A. The Motion to Compel Should be Denied Outright Because Plaintiff’s Separate Statement Fails to Comply with California Court Rules 21 The Court should deny this motion on the basis that the separate statement does not comply 22 with California Rule of Court 3.1345(c). See Mills v. U.S. Bank (2008) 166 Cal. App. 4th 871, 893 23 (denying plaintiff’s motion to compel because it “did not set forth the full response to each of the 24 discovery requests” as required CRC 3.1345(c).) Similar to the separate statement submitted in 25 Mills, Runyon does not provide Payward’s responses to the requests purportedly at issue. Rather, 26 like in Mills, Runyon’s “separate statement repeatedly grouped together several discovery requests, 27 and the section setting forth a statement of the factual and legal reasons for compelling further 28 responses . . . was extremely confusing because it did not indicate which of the specific discovery W ITHERS NY28571/0001-US-9748081/2 5 B ERGMAN LLP OPPOSITION TO PLAINTIFF’S MOTION TO COMPEL FURTHER RESPONSES TO SUPPLEMENTAL REQUESTS FOR PRODUCTION OF DOCUMENTS AND PRIVILEGE LOG 1 requests the various factual and legal reasons related to, and thus did not fulfill the requirement that 2 the statement address the factual and legal reasons for compelling ‘each mater in dispute.’” Ibid. 3 This violates the portion of CRC 3.1345 that states that “[t]he separate statement must be full and 4 complete so that no person is required to review any other document in order to determine the full 5 request and the full response.” The appellate court in Mills held as follows: “We conclude that 6 because Plaintiffs did not comply with the requirements of [CRC 3.1345], the trial court was well 7 within its discretion to deny the motion to compel discovery on that basis.” Mills, 166 Cal. App. 4th 8 at 893. 9 B. Plaintiff’s Requests for Documents Related to His False and Disproven Fraud Claims Are Irrelevant, and Solely Meant to Harass Payward 10 Plaintiff’s request for certain Google spreadsheets and Mr. Ng’s entire DocuSign history, 11 along with his complaints regarding entries on Payward’s privilege log, represent nothing more than 12 Plaintiff’s last-ditch effort to harass Payward. CCP § 2023.010(c) (“Misuses of the discovery 13 process include . . . Employing a discovery method in a manner or to an extent that causes 14 unwarranted annoyance, embarrassment, or oppression, or undue burden and expense.”). These 15 documents are irrelevant to Plaintiff’s remaining claims, and he does nothing to justify these 16 requests. Indeed, Plaintiff’s “summary of relevant facts” only reference his few remaining disability 17 claims, and do not mention his vesting-schedule fraud claim. 18 And with good reason: the purported main witness to and victim of the fraud alleged by 19 Runyon is also represented by Ms. Cochran and sued on these same allegations – that Mr. Ng 20 intentionally defrauded her out of additional shares by changing her vesting schedule from four 21 years to six years in Payward’s cap table management system. (Pallen Decl. ¶ 7, Ex. 6.) However, 22 as Ms. Cochran well knows, the AAA arbitrator hearing that dispute denied this claim, finding it 23 was based on false allegations and contradicted by Ms. Wong’s own testimony, and “every 24 document signed by Ms. Wong and Payward[, which] reflect[] the six-year schedule.” (Id. at 7.) 25 When asked how these additional documents demanded by Runyon are relevant at all to this issue 26 in light of the undisputed facts in this case, Ms. Cochran never responded. (Id. ¶ 13.) 27 This is particularly true for Mr. Ng’s DocuSign history. Payward specifically asked Ms. 28 Cochran how Mr. Ng’s entire DocuSign history is relevant when (1) his allegations of fraud relating W ITHERS NY28571/0001-US-9748081/2 6 B ERGMAN LLP OPPOSITION TO PLAINTIFF’S MOTION TO COMPEL FURTHER RESPONSES TO SUPPLEMENTAL REQUESTS FOR PRODUCTION OF DOCUMENTS AND PRIVILEGE LOG 1 to Payward’s Board have been disproven, (2) his fraud allegations are extremely limited in scope 2 and involve at most two unanimous board consents, (3) Mr. Ng never signed any board consents, 3 and (4) in many cases, such as with the approval for the June 30, 2019, Board consent, Mr. Ng. 4 simply secured approval by Board members via email, not DocuSign.1 Confronted with these facts, 5 Ms. Cochran simply did not respond, and instead filed the instant motion weeks later, and on the 6 eve of Payward’s deadline to file its reply in support of summary judgment. 7 For these reasons alone, Runyon’s motion to compel these documents and privilege log 8 entries related to his disproven fraud claim should be denied. See Nelson v. Superior Ct. (1986) 184 9 Cal. App. 3d 444, 452-53 (“Plaintiff made no showing whatever of any use for the reports other than 10 his speculation that after examining the reports he might be able to formulate some viable theory of 11 liability.”). 12 C. The Google Documents Sought By Runyon Are Either Included In Payward’s Existing Production or Are Non-Responsive 13 However, Runyon’s motion to compel documents and additional information is meritless for 14 a host of different and practical reasons. 15 1. The Google Document Referenced in PAYWARD004792 – PAYWARD004793 Is, 16 As Repeatedly Stated By Payward, A Privileged Draft Board Consent That Appears on Payward’s Privilege Log 17 Ms. Cochran claims that Payward must produce this document in response to Runyon’s 18 Request No. 72. (Pallen Decl., Ex. L.) However, Payward properly responded that it had “already 19 produced responsive and non-privileged documents in its possession, custody and control 20 responsive to this Request.” (Id.) As Payward has explained multiple times to Ms. Cochran and her 21 associate Ms. Sorensen this document is a privileged draft Board document that was withheld on 22 privilege grounds and appears in Payward’s August 19, 2020, Supplemental Privilege Log. Indeed, 23 24 1 Ms. Cochran was well aware of this last fact, as she was provided by Runyon, without Payward’s knowledge, a privileged email 25 between Payward and its counsel regarding a draft of this June 30, 2019 Board consent. Payward became aware that Runyon possessed this document when Ms. Cochran showed the privilege documents to Mr. Ng during his deposition in a surprise attempt 26 to get him to waive Payward’s privilege. (Pallen Decl. ¶15.) When confronted about this tactic, Ms. Cochran conceded the document was privileged. (Id.) This was a clear violation of Ms. Cochran’s legal and ethical obligations. See Clark v. Superior 27 Ct. (2011) 125 Cal. Rptr. 3d 361, 374 (upholding attorney disqualification where the record reflected “evidence from which a trial court could have concluded [that the lawyer] affirmatively used some of the substantive information contained in the 28 privileged documents to question witnesses or to support [a party]'s claims”). W ITHERS NY28571/0001-US-9748081/2 7 B ERGMAN LLP OPPOSITION TO PLAINTIFF’S MOTION TO COMPEL FURTHER RESPONSES TO SUPPLEMENTAL REQUESTS FOR PRODUCTION OF DOCUMENTS AND PRIVILEGE LOG 1 the email attaching this document, and the document itself, appear on lines 634 and 635, 2 respectively, of the privilege log. (Id. Ex. M.)2 3 2. Payward Has Produced All Documents It Could Locate Responsive to Runyon’s Request No. 71 4 Ms. Cochran claims this document is purportedly responsive to Runyon’s Request No. 71. 5 (Id. Ex. K.) That request seeks documents “created by Mr. Runyon tracking country codes and 6 related OPEC data.” (Plaintiff’s Sep. Stmt. at 3:7-9.) Payward responded to this request that it would 7 produce “any additional responsive, non-privileged documents” it was “able to locate after a diligent 8 search and reasonable inquiry.” (Pallen Decl. Ex. L.) After performing this search, Payward was 9 unable to locate any additional responsive documents, including the Google document reference in 10 PAYWARD005166. 11 First, Payward possess no documents reflecting that Mr. Runyon tracked “related OPEC 12 data.” Payward, nor Mr. Runyon, were in any involved with tracking data regarding the 13 Organization of the Petroleum Exporting Countries. Second, Payward is unable to confirm whether 14 this Google document, while linked to Mr. Christie by Runyon, was in fact created by Mr. Runyon. 15 Third, assuming Ms. Cochran meant to seek documents created by Runyon tracking related “OFAC” 16 data, neither this document nor any document possessed by Payward reflects that Mr. Runyon was 17 tracking OFAC data. Indeed, as both Mr. Christie and Mr. Ng testified, Mr. Runyon never raised 18 any OFAC related concerns. (Id. Exs. N.) Mr. Runyon himself confirmed that the Slack message 19 produced as PAYWARD005166 do not reflect that he was tracking or reporting any OFAC related 20 data. (Id. Ex. P.) 21 Ms. Cochran does not dispute this. Instead she simply states, without any support at all, that 22 23 2 Although ultimately irrelevant to this inquiry, it is worth noting that Ms. Cochran is very aware that her argument that this document is somehow vital to her case, and that it would somehow prove vesting schedules “were not awarded in line with the 24 Board’s vote on the matter,” is completely false. As noted above, she and Mr. Runyon possess a copy of this privileged draft Board consent and it does nothing to prove Mr. Runyon’s case. Instead, it confirms Payward’s, and the arbitrator’s, view that the 25 fraud Runyon complains of was nothing more than a correctable mistake. (Id. Ex. 6 at 5-6 (“The uncontested testimony was that the Board did take steps in June 2019 to correct the errors as to the vesting schedule of . . . other employees whose options were 26 to vest over four years and not six years as stated in the 2017 Unanimous Written Consent. The Board has not, however, to date corrected the error affecting Ms. Wong and others whose options, according to their employment documents, were to vest over 27 six years.”). Furthermore, because this document is a draft board document, and there has been no documents or testimony indicating Runyon was ever involved in drafting actual board documents, Payward is unable to determine whether this document 28 was “created by Mr. Runyon” and therefore whether this document is responsive to Request No. 72. (See Plaintiff’s Sep. Stmt. at 2:22-24.) Indeed, as Ms. Cochran is aware, Payward’s lawyers were the ones who drafted Payward’s Board documents. W ITHERS NY28571/0001-US-9748081/2 8 B ERGMAN LLP OPPOSITION TO PLAINTIFF’S MOTION TO COMPEL FURTHER RESPONSES TO SUPPLEMENTAL REQUESTS FOR PRODUCTION OF DOCUMENTS AND PRIVILEGE LOG 1 this particular document will reflect “concerns the Plaintiff brought up regarding Payward’s 2 operations and inability to receive revenue from certain countries.” (Mot. to Compel at 8.) This 3 unsupported lawyer argument presents no evidence making this wishful thinking true. Richard 4 Strick, M.D., Inc. v. United Ret. Plan Consultants, Inc., No. 2:16-cv-08206-AFM, 2018 WL 5 6004529, at *4 (C.D. Cal. July 13, 2018) (“[I]t is insufficient for Plaintiffs merely to present a 6 lawyer’s argument without evidence.”); Nelson, 184 Cal. App. 3d at 452-53. And as illustrated 7 directly above, this argument is simply not true. 8 For these reasons, Plaintiff’s motion to compel production of the Google document 9 referenced in PAYWARD005166 should be denied. 10 D. Plaintiff is Time Barred From Compelling Additional Information Regarding Payward’s Privilege Log 11 As explained to Ms. Cochran (Pallen Decl. Ex. L), her concerns regarding Payward’s August 12 19, 2020, privilege log are untimely and have been resolved with Ms. Cochran’s colleague, Ms. 13 Sorensen. From November 2020 to February 2021, Payward’s counsel corresponded with Ms. 14 Sorensen about entries on the privilege log that she claimed were not privileged. Payward’s counsel 15 explained to her that all of the entries she questioned were drafts of Board minutes sent to our client 16 by its then-lawyers, or that reflected legal advice from outside counsel. Furthermore, Payward’s 17 counsel informed Ms. Sorensen in February 2021 that Mr. Runyon’s time to file a motion to compel 18 pertaining to any privilege logs had expired, and if he wanted to file a motion to compel, Payward 19 would oppose it on that basis, among others. (Id.) Runyon never filed a motion to compel. Therefore, 20 he is time barred from moving to compel at this late stage. See CCP § 2031.310(c). 21 Regardless, as Payward’s counsel told Ms. Sorensen, the privilege log entries Mr. Runyon 22 complains of in his motion (rows 629 – 636) are indeed drafts of Board consents and are, as such, 23 privileged. For Ms. Cochran to ignore this and raise the entries again nine months after Ms. Sorensen 24 raised them, and at the close of discovery, smacks of mal-intent. Ms. Cochran’s statement that 25 “Defendants have repeatedly failed” to provide additional information about these privilege log 26 entries (Plaintiff’s Sep. Stmt. at 7) is completely disingenuous.3 Payward has explained that these 27 28 3 Ms. Cochran makes numerous unsupported and completely false statements in the motion to compel and separate statement. W ITHERS NY28571/0001-US-9748081/2 9 B ERGMAN LLP OPPOSITION TO PLAINTIFF’S MOTION TO COMPEL FURTHER RESPONSES TO SUPPLEMENTAL REQUESTS FOR PRODUCTION OF DOCUMENTS AND PRIVILEGE LOG 1 entries reflect privilege draft board documents and privileged communications attaching those board 2 documents. (Supra Section III.C.1.) 3 Moreover, Ms. Cochran does not challenge Payward’s assertion of privilege over these draft 4 board documents. Instead, Ms. Cochran appears to argue that Payward has waived its attorney-client 5 privilege wholesale. (Plaintiff’s Sep. Stmt. at 6.) This is the first Payward is hearing of this argument. 6 Regardless, the notion that Payward conducted some pre-litigation internal investigation, has put 7 the adequacy of that investigation at issue, or took ameliorative action based on that investigation is 8 invented from whole cloth. Cf. Wellpoint Health Networks, Inc. v. Superior Court (1997) 59 Cal. 9 App. 4th 110. Instead, this is a typical litigation; when Runyon filed this lawsuit, Payward hired 10 undersigned counsel and undertook to gather facts and defend itself. Nothing in this standard 11 scenario suggests any privilege was waived. Additionally, Ms. Cochran appears to argue in the 12 improper separate statement that Payward’s entire privilege log is inadequate. (Id. at 5-6.) This is 13 wholly improper. Ms. Cochran’s sole meet and confer letter on this issue identified only specific 14 entries 630-636 on the privilege log that she wanted additional information for. Again, Payward has 15 repeatedly explained what these entries are. To the extent Ms. Cochran is now challenging 16 Payward’s entire privilege log, the motion to compel must be denied because she failed to meet and 17 confer with Payward about this challenge. 18 E. The Motion to Compel the Remaining Documents Must be Denied Because Runyon Failed to Meet and Confer About These Documents and These Documents are Either 19 Too Vague to Identify or Do Not Exist 20 Plaintiff’s motion to compel Payward’s alleged “Employee Handbook,” “Performance 21 Reviews,” and “Performance Improvement Plan” (Mot. to Compel at 4) must be denied outright 22 because Plaintiff never met and conferred with Payward about these documents. CCP § 2023.010(i). 23 Furthermore, regardless of the outcome of the motion to compel, Defendants should be granted 24 monetary sanctions for Plaintiff’s failure to meet and confer regarding production of these 25 documents. CCP § 2023.020. 26 27 For example, she claims “Plaintiff has identified several redactions/exemptions from production made by Defendant which it claims were made on the grounds of privilege, however, Defendants offer no explanation how the document is privileged. The Defendant has large areas of redaction in documents that are key to this litigation but fails to give justification as to the nature of 28 the redactions.” This is simply not true. Plaintiff’s counsel has not identified any such redactions, and she cites nothing in the record to indicate she has. W ITHERS NY28571/0001-US-9748081/2 10 B ERGMAN LLP OPPOSITION TO PLAINTIFF’S MOTION TO COMPEL FURTHER RESPONSES TO SUPPLEMENTAL REQUESTS FOR PRODUCTION OF DOCUMENTS AND PRIVILEGE LOG 1 Additionally, these documents are completely vague and do not exist. Had Ms. Cochran met 2 and conferred with Payward prior to making this motion, she would know this. Payward does not 3 have, and never has had, an employee handbook. Mr. Runyon testified as to the existence of a 4 Payward employee handbook, but when questioned about this after his deposition testimony, Mr. 5 Runyon revealed he was referring to a handbook offered by Payward’s third-party payroll company, 6 TriNet. Had Ms. Cochran conferred with Payward about this, it would have directed to her to seek 7 this document from third-party TriNet. However, in an abundance of caution, Payward has 8 downloaded a copy of TriNet’s “Worksite Employee Handbook,” and has produced it to Plaintiff. 9 Payward is unclear what Ms. Cochran is referring to when she references “Performance 10 Reviews.” As Payward made clear in its reply in support of its motion for summary adjudication, 11 Mr. Ng provided written and verbal reviews of Mr. Runyon’s work. Payward has produced all of 12 these written reviews to Mr. Runyon. 13 Lastly, it is unclear what Ms. Cochran is referring to when she refers to a “Performance 14 Improvement Plan.” Ms. Cochran questioned Mr. Ng about this, and Mr. Ng testified that is not 15 “aware of any individual receiving a performance improvement plan.” (Id. Ex. O.) 16 For these reasons, Plaintiff’s motion to compel these vague additional documents should be 17 denied. 18 F. Defendants Are Entitled to Sanctions 19 Substantial justification exists to deny the sanctions requested by Runyon. Conversely, 20 Payward should be granted sanctions for being forced to respond to a motion that misuses the 21 discovery process. See CCP § 2023.010(h) (“Misuses of the discovery process include, but are not 22 limited to, the following .. . [m]aking . .. unsuccessfully and without substantial justification, a 23 motion to compel . . .discovery.”). First, the Separate Statement is wholly non-conforming and does 24 not follow the clear rules set out in California Rule of Court 3.1345(c); Mills, 166 Cal. App. 4th at 25 893 (denying plaintiff’s motion to compel because it “did not set forth the full response to each of 26 the discovery requests” as required CRC 3.1345(c).) In addition, while both the motion and the 27 separate statement speak to purported issues with Payward’s privilege logs, neither provides 28 examples of redacted documents that it believes were wrongfully withheld. Moreover, the only W ITHERS NY28571/0001-US-9748081/2 11 B ERGMAN LLP OPPOSITION TO PLAINTIFF’S MOTION TO COMPEL FURTHER RESPONSES TO SUPPLEMENTAL REQUESTS FOR PRODUCTION OF DOCUMENTS AND PRIVILEGE LOG 1 privilege log rows mentioned in the Motion have been addressed by Payward in the meet and confer 2 process; Payward has made clear that those documents are drafts of Board consent documents and 3 are, in fact, privileged. (See Pallen Decl., Ex. L.) Finally, Runyon claims that Payward refused to 4 prod