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Case of the Month (from CFLR Monthly)

June 2024
[Archive]

Discovery sanctions are not limited to counsel of record. . .

 

In affirmance, the Fourth District held the trial court did not abuse its discretion by awarding $10,000 in sanctions against defendant's attorney for discovery misuse, even though defendant's attorney withdrew as counsel prior to plaintiff filing a renewed motion to compel and request for sanctions.

 

Masimo Corporation v. Vanderpool Law Firm, Inc.

(May 2, 2024)

California Court of Appeal 4 Civ G061829 (Div 3), ___ Cal.Rptr.3d ___, 2024 WL 1926197, 2024 FA 2131, per Bedsworth (Goethals, J., and Motoike, J., concurring). Orange County's Howard, affirmed. For Vanderpool Law Firm, Inc. (Appellant): Douglas Vanderpool and Brooke Leone Bove. For Masimo Corporation (Respondent): David Joseph Schindler and Robert James Ellison. CFLP §D.122.

 

Masimo Corporation (Masimo) sued a former employee, John Bauche, and two of his companies after discovering Bauche had embezzled nearly $1 million from Masimo while he was an employee. The Vanderpool Law Firm (Vanderpool) represented Bauche and his companies in the lawsuit. A federal grand jury also indicted Bauche for mail fraud, money laundering, and related crimes.

 

Boilerplate objections. . .
In August 2019, Masimo first served discovery requests (interrogatories and requests for production of documents) on Bauche and his companies. Their responses to these requests "consisted of boilerplate objections with no substantive responses."

On April 20, 2021, Masimo filed a motion to compel discovery responses. In response, Bauche claimed responding to Masimo's discovery requests would violate his Fifth Amendment rights due to the pending federal criminal action against him. As a result, the trial court stayed the action, later lifting this stay in December 2021 after Bauche completed his federal diversion program and the criminal action was dismissed.

 

Vanderpool and defendants renege on their promise to provide substantive responses. . .
The parties and an appointed discovery referee held a discovery motion scheduling conference on February 10, 2022, in which Vanderpool told the referee that it would provide further discovery responses. The referee's recommendations to the trial court following this conference suggested that "'counsel for all parties hold a meaningful "meet and confer" session in a good faith attempt to resolve the issue of further discovery responses being submitted by the three defendants. Thereafter, [Vanderpool] agreed that further responses would be promptly provided by the three defendants.'"

On February 24, 2022, Vanderpool served supplemental discovery responses that provided "minimal substantive responses" and "consisted of the same objections made in 2019, plus some new ones." The following month Vanderpool withdrew as counsel for Bauche and his two companies. Bauche, who was a non-lawyer, was listed as representing the three defendants.

 

An uncivil response to Masimo's efforts to meet and confer. . .
Masimo subsequently attempted to meet and confer with Vanderpool, who after "dodging letters and emails," finally responded to an email by stating that "'Your remedy is elsewhere, and an attorney with your billing rate should know that. We are not here to educate you.'" Masimo then filed a renewed motion to compel and request for sanctions with the discovery referee on April 18, 2022. Masimo's counsel eventually conferred directly with Bauche, who said that he would "'stick with these objections for right now.'" After Vanderpool was served with the moving papers for the motion to compel, its principal attorney sent an email to Masimo's attorney with the subject line "'You are joking right?'" The body of the email read "'In 30 years of practice this may be the stupidest thing I've ever seen. Robert is this really why you went to law school? Quit sending us paper. [Y]ou know we are out of the case so just knock it off and get a life. Otherwise we're going to be requesting sanctions against your firm for even bothering us with this nonsense.'"

A hearing on Masimo's requests was held on May 16, 2022, with Vanderpool making a special appearance. At the conclusion of the hearing, the referee recommended the motions to compel be granted and awarded Masimo $10,000 in discovery sanctions against Bauche, his two companies, and Vanderpool. The referee also noted that Vanderpool included a letter from some members of Congress about Masimo's CEO in an effort "'inappropriately to prejudice discovery referee and [the trial court] with irrelevant allegations of misconduct[.]'" The referee further noted that the words were "'shameful'" and "'cannot be tolerated.'"

On September 12, 2022, the trial court (Orange County's Howard) adopted the referee's recommendation. Vanderpool appealed but the Fourth District affirmed.

The justices first concluded that "[u]nquestionably Vanderpool engaged in discovery misuse by its responses to Masimo's initial discovery requests and later by its supplemental response. In the former instance, Vanderpool's responses began with a page and a half of general objections, followed by more objections that refused to provide even basic information, such as Bauche's date and place of birth, his current address, his educational history, or whether he could read or write English. In the latter instance, even though Vanderpool had represented to the discovery referee that it would promptly provide further responses, these responses consisted of more "boilerplate objections." The justices noted that, in fact, the responses to the document production requests "were so boilerplate that individual responses began 'Responding Party objects to this interrogatory….'" In addition to these deficient discovery responses, Vanderpool advised Bauche and his two companies to "stonewall" Masimo's discovery efforts.

The justices next held that CCP §2023.030(a) [authorizing monetary sanctions for discovery misuse] does not limit imposition of sanctions to counsel of record. Specifically, CCP §2023.030(a) provides that "any attorney" who advises discovery misuse may be liable for sanctions. Here, the justices observed that in addition to the deficient discovery responses, Vanderpool advised Bauche and his two companies to "stonewall" Masimo's discovery efforts, as evidenced by Bauche's decision to "stick with the objections" after Vanderpool withdrew from representation.

The justices then made short shrift of Vanderpool's second argument, that the trial court did not independently consider the discovery referee's findings. Here, the justices noted that the minute order of September 13, 2022, indicated that the trial court reviewed and considered the referee's recommendation report as well as Vanderpool's objections to the report and Masimo's opposition to Vanderpool's objections. The justices added that the trial court is not required to prepare a ruling separate from the discovery referee's recommendations.

Finally, the justices rejected Vanderpool's last argument, that Masimo's counsel failed to meet and confer before filing the motion to compel, noting that this assertion is not supported by the record. First, Vanderpool "dodg[ed] letters and emails" relating to the meet and confer efforts, only to finally respond in email that "'Your remedy is elsewhere.'" Second, Masimo's counsel met and conferred with Bauche directly, who in turn stated he would "'stick with the objections.'"

For these reasons, the Fourth District affirmed the trial court's order awarding discovery sanctions against Vanderpool.

 

 

COMMENT:

  

As an epilogue, the justices decried the conduct of Vanderpool's principal attorney and "the deterioration in the way attorneys now address and behave toward each other." They noted that they had devoted an entire opinion on this topic in Lasalle v. Vogel (2019) 36 Cal.App.5th 127, 248 Cal.Rptr.3d 263. They further noted that "[c]ivility is not about etiquette." Instead, incivility slows down litigation and costs people money. This in turn makes hiring and retaining lawyers more difficult. Finally, the justices warned "we will not keep looking the other way when attorneys practice like this. They will be called out and immortalized in the California Appellate Reports."

 

Library References
5 Witkin, Summary of Cal. Law, (11th ed. 2024) Torts § 594
Hogoboom & King, Cal. Practice Guide: Family Law (The Rutter Group), ¶ 11:392

 

 

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