LATERAL LINK GROUP, LLC, a California Limited Liability Company, Plaintiff, v. HABEAS CORP., a Delaware corporation doing business as LATERAL.LY; MICAH SPRINGUT, an individual doing business as LATERAL.LY; and DOES 1-10, inclusive Defendants CASE NO. CV-14-05695-JAK (JEMx) United States District Court, C.D. California Filed December 29, 2016 Counsel GAIL MIGDAL TITLE, ESQ., ADR SERVICES, INC., 1900 Avenue of the Stars, Suite 250, Los Angeles, California 90067, 310.201.0010, gtitle@adrservices.org Title, Gail Migdal, Discovery Referee REPORT AND RECOMMENDATION OF DISCOVERY REFEREE RE: DEFENDANTS' APPLICATION FOR FEES IN CONNECTION WITH MOTION FOR CONTEMPT OR SANCTIONS – DISCOVERY REFEREE PORTION (DKT. 252) *1 This Report and Recommendation is submitted to the Honorable John A. Kronstadt, United States District Court Judge for the Central District of California, pursuant to his Order of October 7, 2016. (Dkt. 234.) INTRODUCTION Before the Referee is an “Application for Fees in Connection with Motion for Contempt or Sanctions – Discovery Referee Portion” presented by Defendants Habeas Corp. and Micah Springut (collectively “Defendants”) against Plaintiff Lateral Link Group, LLC (“Plaintiff”). (Dkt. 252.) The Referee recommends that fees in the amount of $13,788.75 be awarded to Defendants. FACTUAL AND PROCEDURAL BACKGROUND The discovery dispute at issue arose from Defendants' efforts to compel the deposition of appropriate witnesses to testify regarding matters such as Plaintiff's regulation of and quality control measures for its trademark. Plaintiff initially produced its principal, Michael Allen, for deposition on October 22, 2015, but his testimony was evasive and exhibited lack of cooperation by the deponent as well as Plaintiff's counsel. The Referee denied without prejudice the request to order another day of Mr. Allen's deposition, but by Orders dated December 7, 2015 and January 4, 2016, required Plaintiff to provide additional written responses to certain questions that had been posed at Mr. Allen's deposition, including some regarding quality control. The Referee reserved the right to order a further oral deposition if Plaintiff's written responses proved to be inadequate. Plaintiff provided additional written responses. However, as set forth in the discovery ruling of January 20, 2016, the Referee found certain responses inadequate and ordered Plaintiff to produce another 30(b)6) witness for a further telephonic deposition. Plaintiff produced Andrew Wood and defendants conducted a second 30(b)(6) deposition on February 24, 2016. On or about April 11, 2016, Defendants filed with the Court a Motion for Contempt and Preclusive Sanctions against Plaintiff. (Dkt. 212.) Defendants contended that Mr. Wood was completely unprepared to testify regarding Plaintiff's qualify control procedures, as previously ordered. Defendants argued that contempt and preclusion sanctions were warranted because Plaintiff “treated its discovery obligations, culminating in Mr. Wood's deposition, with utter disdain and deliberately disregarded repeated Orders in this case.” (Id., at p. 16.) On May 2, 2016, Judge Kronstadt referred to this Discovery Referee “the portion of the [Contempt] Motion concerning the December 7, 2015, January 4, 2016, and January 20, 2016, Orders by Discovery Referee Title as to Plaintiff's required designation of appropriate witness(es) to testify about its quality control efforts regarding its trademark” and “whether Plaintiff has complied with those Orders.” (Dkt. 234.) In accordance with her understanding of the Court's Order, the Referee was to address Plaintiff's compliance with her Orders only and not to address whether the remedies sought by the Motion were appropriate. *2 On May 20, 2016, the Referee issued her “Report of Discovery Referee Pursuant to Order of May 3, 2016.” (Dkt. 221.) In that Report, the Discovery Referee found that Plaintiff had substantially, but not entirely, complied with her orders. In subsequently adopting the Referee's Report on October 7, 2016, Judge Kronstadt found that contempt and preclusive sanctions were not appropriate, but Plaintiff was ordered to comply with the Referees' orders issued on December 7, 2015, January 4, 2016 and January 20, 2016, by presenting yet another Rule 30(b)(6) witness for deposition. (Dkt. 234.) Defendants were also advised that they “may file an application for an award of attorneys' fees relating to the matters at issue.” (Ibid.) On November 7, 2016, Defendants submitted the present Application for Fees re Contempt Motion – Discovery Referee Portion – seeking $14,733.75 in fees. (Dkt. 252.) Plaintiff submitted an opposition on November 20, 2016. Defendants submitted a reply on December 1, 2016. (Dkt. 258.) The District Court referred any such application to the Referee for the preparation of a report and recommendation. (Dkt. 234.) DISCUSSION In the Application, Defendants request that the Discovery Referee recommend, and the Court order, that Plaintiff must pay fees in the amount of $14,733.75 to Defendants for preparation of the contempt motion. Plaintiff makes a number of objections to Defendants' Application. First, Plaintiff argues that fees are entirely inappropriate because Plaintiff substantially complied with the Discovery Referee's Order. FRCP 30(b)(6) imposes a duty on a responding party “ ‘to make a conscientious, good-faith effort to designate knowledgeable persons for Rule 30(b)(6) depositions and to prepare them to fully and unevasively answer questions about the designated subject matter.’ [Citation omitted.]” (Bd. of Trustees of Leland Stanford Junior Univ. v. Tyco Int'l Ltd. (C.D. Cal. 2008) 253 F.R.D. 524, 526.) The law is well-established that a 30(b)(6) deponent has an affirmative obligation to educate himself as to the matters regarding the corporation in preparation for the deposition.) (Ibid.) Reasonable expenses (including attorney fees) caused by the failure to comply with discovery orders may be awarded against the disobedient parties and/or their attorneys unless they demonstrate that noncompliance was substantially justified or an award is otherwise unjust. (FRCP 37(b)(2)(C); Lew v. Kona Hosp. (9th Cir. 1985) 754 F2d 1420, 1427 [no showing of willfulness necessarily required for sanctions].) While the District Court Judge denied contempt or preclusive sanctions based upon the Referee's determination of substantial compliance, there was also a finding that Plaintiff failed to fully comply with the Referee's order by producing Mr. Wood, who was unable to provide all reasonably requested information relating to Plaintiff's quality control measures. This was the basis of the Court's order requiring Plaintiff to produce yet a third 30(b)(6) witness to be deposed, in order to fully comply with the Referee's December 7, 2015, January 4, 2016 and January 20, 2016 orders. The Referee finds that an award of reasonable expenses (attorneys' fees) to Defendants is properly based upon Plaintiff's failure to fully comply with the Referee's orders, which failure was not substantially justified and no other circumstances render an award of fees unjust. Second, Plaintiff argues that the requested fees are improper and unreasonable in amount. The court, or Referee, has considerable discretion in determining the amount and form of the award. (See General Signal Corp. v. Donallco, Inc. (9th Cir. 1986) 787 F2d 1376, 1380; Marrocco v. Hill (D. Nev. 2013) 291 FRD 586, 588-589 [analyzing fee request].) Plaintiff challenges the amount sought on the following grounds: *3 Duplication of Effort: Plaintiff contends that a majority of the hours claimed by Defendants should be excluded because the motion combined requests for fees from both the Magistrate Judge and the Discovery Referee. The Referee disagrees. Defendants properly and reasonably allocated the fees requested between the overlapping and common portions of the motion in order to circumvent duplicate fees. Objections to Referee's Report: Plaintiff argues that $3,900 related to “objections to Discovery Referee's report” is unreasonable because those objections were overruled by the District Court Judge, who adopted the Referee's report. The Referee disagrees. Objections are part of the process in litigating motions. Plaintiff filed its own objections. Under federal fee-shifting statutes, the prevailing party is entitled to recover a fully compensatory fee. (Hensley v. Eckhart (1983) 461 U.S. 424, 434.) Plaintiff has cited no authority to support the separating out specific phases of a fee request. Original Briefing: Plaintiff argues that $6,292.50 in connection with Defendants' “original briefing filed as Joint Stipulation” is unreasonable because the briefing was stricken and they were required to file revised papers. Plaintiff's argument is meritless, as it would exclude the bulk of the work done on the motion. The Referee recommends, however, that the fees requested for reformatting the Application ($945) be DENIED. Plaintiff should not have to pay for Defendants' failure to properly file the Application. This Application: Plaintiff contends that the $1,260 sought in connection with the present Application is improper and unreasonable. However, fees on fees are routinely granted and nothing has been provided to show that this case should be an exception. (Maitlink, Inc. v. Home Depot USA, Inc. (S.D. Cal. 2008) 2008 WL 8504767 at *6; Sure Safe Industries, Inc. v.C & R Pier Mfg. (S.D. Cal. 1993) 152 F.R.D. 625, 627.) Finally, Plaintiff argues that the claimed hourly billing rates of $690 for Milton Springut and $630 for Tal Benschar are unreasonably high. Again, this argument is not well taken. Sanctions applications were already granted by the Magistrate Judge (Dkt. 236) as well as the District Court Judge (Dkt. 236) based on these rates. Furthermore, Plaintiff did not object to the rates at that time. There is also nothing to show that the rates requested are unreasonable. RECOMMENDATION It is therefore the Referee's recommendation that the District Court issue an Order: (1) accepting this Report and Recommendation; and (2) awarding fees to Defendants in the amount of $13,788.75, payable by Plaintiff forthwith. Respectfully submitted, GAIL MIGDAL TITLE, Discovery Referee PROOF OF SERVICE State of California County of Los Angeles I certify that I am employed in the County of Los Angeles, State of California. I am over the age of 18 and not a party to the within action; my business address is 1900 Avenue of the Stars, Suite 250, Los Angeles, California 90067. On December 29, 2016, I served the foregoing document described as the REPORT AND RECOMMENDATION OF DISCOVERY REFEREE RE: DEFENDANTS' APPLICATION FOR FEES IN CONNECTION WITH MOTION FOR CONTEMPT OR SANCTIONS – DISCOVERY REFEREE PORTION (DKT. 252) on the interested parties in this action as follows: Robert Tauler, Esq. TAULER SMITH LLP 11111 Santa Monica Boulevard, Suite 500 Los Angeles, California 90025 *4 rtauler@taulersmith.com William C. Steffin, Esq. Armin Azod, Esq. STEFFIN LELKES AZOD 1801 Century Park East, Floor 24 Los Angeles, California 90067 wsteffin@aol.com armin.azod@usaiplaw.com Hon. John A. Kronstadt First Street Courthouse 350 W. First Street, Courtroom 10B Los Angeles, CA 90012 U.S. Mail Only Karin G. Pagnanelli, Esq. Elaine Kim, Esq. Alexa L. Lewis, Esq. MITCHELL SILBERBERG & KNUPP 11377 West Olympic Boulevard Los Angeles, California 90064 kgp@msk.com ekk@msk.com all@msk.com Milton Springut, Esq. Tal S. Benschar, Esq. SPRINGUT LAW 45 Rockefeller Plaza, 20th Floor New York, New York 10111 ms@springutlaw.com tbenschar@springutlaw.com X BY U.S. MAIL, I placed a true copy of the document described above in a sealed envelope and caused such envelope with postage thereon to be placed in the United States mail at Los Angeles, California. X BY E-MAIL OR ELECTRONIC TRANSMISSION: I caused a copy of the document(s) to be sent from e-mail address patricia@adrservices.org to the persons at the e-mail addresses listed in the Service List. I did not receive, within a reasonable time after the transmission, any electronic message or other indication that the transmission was unsuccessful. X STATE I declare under penalty of perjury under the laws of the State of California that the above is true and correct. ____ FEDERAL I declare under penalty of perjury under the laws of the United States that the above is true and correct. Executed on December 29, 2016 at Los Angeles, California Patricia Taylor