United States District Court, N.D. California
OPERATING ENGINEERS' HEALTH AND WELFARE TRUST FUND FOR NORTHERN CALIFORNIA, et al., Plaintiffs,
CENTRAL VALLEY CONSTRUCTION, Defendant.
ORDER GRANTING MOTION FOR SANCTIONS Re: Dkt. No.
A. WESTMORE UNITED STATES MAGISTRATE JUDGE
August 27, 2019, Plaintiffs Operating Engineers' Health
and Wealth Trust Fund, et al. filed a motion for sanctions
against Defendant Central Valley Construction for failure to
comply with Federal Rule of Civil Procedure 37.
December 5, 2019, the Court held a hearing, and after careful
consideration of the parties' arguments and the
applicable legal authority, for the reasons set forth below,
GRANTS Plaintiffs' motion for sanctions.
April 26, 2017, Plaintiffs filed this ERISA action to compel
Defendant to comply with an audit of its payroll records for
the period from October 29, 2014 through the date of
inspection. Defendant retained Counsel David C. Johnston and
filed an answer to the complaint on May 25, 2017. (Dkt. No.
17, 2017, the Court issued an order referring this case to
mediation. (Dkt. No. 14.) On August 28, 2017, the parties
participated in a pre-mediation conference call with mediator
Geoffrey White, during which the participants concluded that
a mediation date would be set after the parities had a
further opportunity to meet and confer. (See Decl.
of Michele R. Stafford, “Stafford Decl., ” Dkt.
No. 58 ¶¶ 3-5.) Thereafter, Defendant contacted
Plaintiffs' Auditor and scheduled an audit appointment
for October 26, 2017. (Stafford Decl. ¶ 6.) Defendant
provided Plaintiffs' Auditor with some of the
documentation that was necessary to conduct the audit.
requested additional documentation that the auditors advised
was necessary to complete the audit. (Stafford Decl. ¶
7.) Specifically, Plaintiffs allege that the Defendant has
failed to provide its cash disbursements journal (or
equivalent records) to Plaintiffs' Auditor. Id.
Plaintiffs' counsel has detailed to Defendant's
counsel what equivalent alternative documents can be
about May 22, 2018, Plaintiffs propounded discovery on
Defendant. (Stafford Decl. ¶ 8). The discovery requested
information that would ordinarily be disclosed by an
employer's cash disbursements journal. Id. No
response to the discovery was received. Id. As such,
Plaintiffs sent a detailed meet and confer letter to Mr.
Johnston on or about August 2, 2018. (Stafford Decl. ¶
9.) The discovery responses remain outstanding, and no
additional information has been produced by Defendant.
Id. In response to the meet and confer letter, Mr.
Johnston responded that he would “forward the letter to
his client.” Id. Plaintiffs also demanded that
Mr. Johnston provide his availability for a meet and confer
telephone conference pursuant to Judge Westmore's
Standing Order. Id. No availability was provided.
then demanded that a meet and confer take place
telephonically in October 2018. (Stafford Decl. ¶ 10.)
The meet and confer call occurred, and Mr. Johnston stated
that he would work with his client to attempt to provide
responses to the outstanding discovery. Id.
Plaintiffs agreed to give Mr. Johnston additional time, but
stated that a joint discovery letter brief would need to be
filed if Defendant did not respond to the propounded
discovery letter was filed on December 11, 2018. (Dkt. No.
33.) On December 20, 2018, the Court issued an order
requiring that Defendant produce responses by January 10,
No. 38; Stafford Decl. ¶ 11.)
March 12, 2019, the parties filed a joint request to continue
the case management conference set for March 19, 2019. (Dkt.
No. 40; Stafford Decl. ¶ 12). Mr. Johnston alleged that
Defendant provided hundreds of pages of bank statements and
paid checks to Plaintiffs' counsel to be delivered to the
Auditor and that Defendant is/was gathering additional
documents requested by the audit. (Dkt. No. 40 at 3.) Mr.
Johnston further noted that he has been out of his office due
to the serious medical condition of his wife and assisting
his brother in a regimen of chemotherapy and radiation for
Stage 4 esophageal cancer. Id. As a result, Judge
Westmore continued the March 19, 2019 Case Management
Conference and ordered Defendant to provide its discovery
responses and produce all responsive documents within 21 days
of the March 13, 2019 order. (Dkt. No. 41 at 4.) Defendant
again failed to provide any discovery responses and produce
responsive documents by the April 3, 2019 deadline, and, to
date, has not done so. (Stafford Decl. ¶ 13.)
14, 2019, Plaintiffs filed a motion for sanctions. (Dkt. No.
43.) Defendant did not file an opposition or statement of
non-opposition. On July 3, 2019, the Court issued an order to
show cause requiring Defendant to file an opposition or
statement of non-opposition, and to file a response to the
order to show cause explaining why it did not file a timely
opposition. (Dkt. No. 50.) Defendant failed to file an
opposition, and did not file a response to the order to show
17, 2019, the Court denied Plaintiffs' motion for
sanctions on grounds that Plaintiffs' declaration did not
attempt to itemize the attorneys' fees or justify the
claimed hourly rates. (Dkt. No. 52.)
August 27, 2019, Plaintiffs filed a motion for sanctions
based on Defendant's failure to comply with three prior
court orders. (Pls.' Mot., Dkt. No. 56.)
August 27, 2019, the Court held a case management conference,
where Defendant did not appear. On August 29, 2019, the Court
issued an order to show cause to defense counsel, David
Johnston, to respond by no later than September 9, 2019, why
he should not pay monetary sanctions in the amount of $500
for his failure to appear at the case management conference.
(Dkt. No. 62.) Mr. Johnston was also ordered to address
whether he was able to provide continued representation given
the personal hardships that he was experiencing. Id.
at 1. Mr. Johnston did not file a response to the order to
show cause. (See Dkt. No. 63 at 1.)
did not file a timely opposition to the motion for sanctions,
so the Court issued a second order to show cause to Mr.
Johnston on September 30, 2019 directing him
1) to file an opposition or statement of non-opposition to
the pending motion [for sanctions], and
2) to file a response to this second order to show cause
explaining why the opposition was not timely filed, why the
motion for sanctions should not be granted as unopposed and
sanctions be paid by him personally instead of by his client,
why the Court should not impose sanctions of $1000.00 on him
personally for failing to appear at the case management
conference, and whether he is able to continue representing
(Dkt. No. 63.) The Court acknowledged that “personal
obligations can negatively impact an attorney's ability
to manage their case load[, ]” but that “does not
relieve the attorney of their responsibility of keeping the
court, opposing counsel, and their client informed of the
circumstances, and may require that counsel withdraw from
representation rather than abandon their client.”
Id. at 2.
October 15, 2019, Defendant filed its opposition to the
motion for sanctions, in which defense counsel represented
that he expects to serve full and complete responses, without
objection, by the November 7, 2019 hearing date.
(See Def.'s Opp'n, Dkt. No. 65 at 2:5-7.) On
October 22, 2019, Plaintiff filed a reply. (Pls.' Reply,
Dkt. No. 68.)
November 4, 2019, the Court continued the hearing date, and
ordered the parties to meet and confer and file a joint
status report on or before November 18, 2019 to inform the