Estate of Silvia Manzo Velasco et al vs Uber Technologies Inc et al

Case Number

24CV03780

Case Type

Hearing Date / Time

Fri, 01/31/2025 - 10:00

Nature of Proceedings

Motion for Order

Tentative Ruling

For all reasons discussed herein, the motion of plaintiffs for an order compelling Checkr, Inc., to provide further responses and documents responsive to plaintiffs’ demand for production of documents, set two, demands 31 and 32, as ordered by the Court on December 13, 2024, is granted as to plaintiffs’ request for an award of monetary sanctions, and denied as to plaintiffs’ request for issue sanctions. The Court awards sanctions in favor of plaintiffs and against defendant Checkr, Inc., in the amount of $4,450, payable to plaintiffs’ counsel. Payment of sanctions is due by February 28, 2025.

Background:

This action was filed with the Superior Court of California for the County of San Francisco as case no. CGC-23-606780 entitled Estate of Silvia Manzo Velasco v. Uber Technologies et al. (the SF Action), and transferred to this Court on July 9, 2024.  

Court records, including those filed in the SF Action, reflect that on May 30, 2023, plaintiffs the Estate of Silvia Manzo Velasco (Silvia) by and through its successor in interest Ricardo Velasco (Ricardo), Ricardo, Juan Velasco (Juan), Ana Velasco (Ana), Kasandra Velasco (Kasandra), Monica Velasco (Monica), Jose Alvarado (Jose) by and through his guardian ad litem Ana, and Francisca Solis (Solis) (collectively, plaintiffs) filed their original complaint against defendants Uber Technologies, Inc. (Uber), Portier, LLC (Portier), Checkr, Inc. (Checkr), and Andrew Raymond Burgher (Burgher) (collectively, defendants), alleging four causes of action: (1) negligence (against all defendants); (2) negligent hiring, supervision, or retention (against Uber, Portier, and Checkr); (3) wrongful death (against all defendants); and (4) survival action (against all defendants). (Note: Due to common familial surnames, the Court will refer to plaintiffs by their first names where necessary. No disrespect is intended.)

On June 6, 2023, plaintiffs filed in the SF Action a first amended complaint (the FAC) against defendants alleging the same four causes of action described above. As alleged in the operative FAC:

Ricardo is the husband of Silvia, and Juan, Ana, Kasandra, and Monica are Silvia’s children. (FAC, ¶¶ 6-10.) Jose is Silvia’s biological grandson, and Solis is the mother of Silvia. (Id. at ¶¶ 11-12.)

Uber operates a Transportation Network Company which provides transportation options and vehicles for users of its services through an online application (the Uber App). (FAC, ¶ 13.) Portier is a wholly owned subsidiary of Uber that runs the Delivery Network Company arm of Uber and that does business as Uber Eats, a division of Uber that provides on-demand food delivery services through an “Uber Eats App” mobile phone application. (Id. at ¶¶ 14 & 16.) Uber and Portier (collectively, the Uber Parties) employ drivers through the Uber App and Uber Eats App. (Id. at ¶ 16.) Portier generates leads for Uber Eats drivers through the Uber Eats App to facilitate the delivery of food to customers, and holds the insurance certificate for insurance carried by Uber. (Id. at ¶¶ 16 & 18.)

The Uber Parties perform background investigations of drivers through Checkr, which is a third-party investigative consumer reporting agency. (FAC, ¶¶ 19 & 52.) The background checks which the Uber Parties outsource to Checkr are based on unverified information submitted by prospective drivers either through the Uber Eats App or the website, and do not require biometric identifiers such as a fingerprint. (Id. at ¶ 46.) As a result, the background checks performed by Checkr on behalf of the Uber Parties fail to uncover criminal conduct and driving histories due to Uber and Portier’s self-imposed requirement for expediency. (Ibid.)

Burgher entered into a Technology Services Agreement with the Uber Parties in which Burgher agreed that Burgher’s transportation of passengers or delivery of food for Uber and Portier furthered an employer-employee relationship. (FAC, ¶ 61.) On October 26, 2021, Silvia was the passenger in a vehicle which, suddenly and without warning, was violently struck by a vehicle operated by Burgher. (Id. at ¶ 73.) At the time of the incident, Burgher was working as a commercial driver for Uber and Uber Eats. (Id. at ¶ 74.) Prior to the incident, Burgher had been operating his vehicle at speeds up to 120 miles per hour while intoxicated. (Id. at ¶¶ 75-76.)

Though the Uber Parties employed Checkr to investigate Burgher’s criminal history and motor vehicle records, Checkr failed to identify prior criminal convictions of Burgher which showed, among other things, that Burgher was on probation for a second “DUI” conviction until October 31, 2015, within the seven years prior to the background check performed by Checkr in connection with Burgher’s potential employment with the Uber Parties. (Id. at ¶ 82.)

On December 15, 2023, Uber and Portier separately answered the FAC, generally denying its allegations and asserting affirmative defenses. Burgher filed an answer to the FAC on January 16, 2024, generally denying its allegations and asserting affirmative defenses. Checkr answered the FAC on February 22, 2024, also generally denying its allegations and asserting affirmative defenses.

Relevant to the present proceeding, on September 13, 2024, plaintiffs filed a motion (the Checkr Set Two Motion) for an order compelling Checkr to serve further responses and produce documents responsive to plaintiffs’ set two demand for production of documents (the Checkr Set Two Demand), which was opposed by Checkr.

On October 3, 2024, Checkr filed a motion for a protective order (the Checkr Protective Order Motion), and a joinder to a similar motion for a protective order filed by the Uber Parties on September 30, 2024, each of which were opposed by plaintiffs.

On November 8, 2024, the Court entered an order continuing the hearings on the Checkr Protective Order Motion and the Checkr Set Two Motion to November 22, 2024, to permit the parties time to further meet and confer with respect to the terms of an appropriate protective order which the Court indicated it was inclined to enter. The Court directed the parties to submit status reports by a prescribed deadline setting forth the parties’ efforts to meet and confer regarding a protective order and which, if any, issues presented in the Checkr Set Two Motion were resolved and which issues remain.

After the November 22, 2024, continued hearing, the Court entered an order granting, among other things, the Checkr Protective Order Motion, and further continuing the hearing on the Checkr Set Two Motion to December 6, 2024, to permit additional time for the parties to resolve any remaining issues in light of the Court’s ruling. (See Nov. 22, 2024, Minute Order.) The Court again directed the parties to prepare and submit status reports setting forth what, if any, issues remained with respect to the Checkr Set Two Motion considering the Court’s ruling.

On November 26, 2024, the Uber Parties and Checkr submitted for the Court’s signature a proposed copy of the Los Angeles Model Stipulation and Protective Order – Confidential Designation Only (the Protective Order), in the form provided by the Superior Court of Los Angeles County, which the Court signed and entered on the same day.

On December 6, 2024, the Court again continued the hearing on the Checkr Set Two Motion to December 13, 2024, due to the filing of status reports after the deadline prescribed in the November 22, 2024, order further described above, to permit the Court sufficient time to review those status reports. (See Dec. 6, 2024, Minute Order.)

On December 13, 2024, the Court entered a Minute Order (the December 13 Order) granting the Checkr Set Two Motion, and ordering Checkr to provide verified further responses to the Checkr Set Two Demand, without overruled objections, and to “produce complete copies of all documents requested in [the Checkr Set Two Demand] subject and without prejudice to the designation of any document as confidential” pursuant to the Protective Order. (Dec. 13, 2024, Minute Order.)

On January 3, 2025, plaintiffs filed a motion (the January 3 Motion) for an order compelling Checkr to provide further responses and documents responsive to Checkr Set Two Demand nos. 31 and 32, and for issue and monetary sanctions against Checkr based on what plaintiffs contend was a failure by Checkr to comply with the December 13 Order. On the same date, plaintiffs filed an ex parte application (the ex parte application) for an order shortening time to hear the January 3 Motion.

On January 6 and 7, 2025, the Court entered orders advancing the hearing on the January 3 Motion to January 6, 2025, granting the January 3 Motion, and directing Checkr to, on or before January 7, 2025, produce all documents responsive to Checkr Set Two Demand nos. 31 and 32, as provided in the December 13 Order, including, but not limited to a complete unredacted copy of the “Background Check Services Agreement” also referred to as the “Master Services Agreement” (the MSA) with all attachments and addendums. (Jan. 6 & 7, 2025, Orders.) The Court reserved the issue of plaintiffs’ request for an award of issue and monetary sanctions against Checkr, advancing that portion of the hearing to January 31, 2025. (Ibid.)

On January 17, 2025, Checkr filed an opposition to the request of plaintiffs for an award of issue and monetary sanctions. The opposition is supported by the declaration of Checkr’s counsel, Emily Gegne (Gegne), who states that after the Protective Order was entered, Checkr produced the MSA which contained redactions appearing in the MSA produced by the Uber Parties. (Gegne Decl., ¶¶ 6-7.) Gegne further contends that at the December 13, 2024, hearing further described above, Gegne noted that the issue of redactions to the MSA had not been addressed by plaintiffs. (Id. at ¶ 8.) Therefore, Gegne contends, it was her understanding that the issue of redactions to documents that were the subject of the Checkr Set Two Motion “was still in the meet and confer stage”, and had not yet decided by the Court. (Id. at ¶ 9.)

Gegne further states that Checkr produced an unredacted copy of the MSA on January 6, 2025, and produced prior unredacted drafts of that document on January 10, 2025. (Gegne Decl., ¶¶ 11-12 & Exhs. A-B.)

Analysis:

To the extent authorized by statute, the court may impose “a monetary sanction ordering that one engaging in the misuse of the discovery process, or any attorney advising that conduct, or both pay the reasonable expenses, including attorney’s fees, incurred by anyone as a result of that conduct.” (Code Civ. Proc., § 2023.030, subd. (a).) Misuses of the discovery process include the failure “to respond or to submit to an authorized method of discovery”, “[d]isobeying a court order to provide discovery”, and unsuccessfully opposing, without substantial justification, a motion to compel discovery. (Code Civ. Proc., § 2023.010, subds. (d), (g), & (h).) Code of Civil Procedure section 2031.310, subdivision (i), authorizes the imposition of a monetary sanction against a party who fails to obey an order compelling a further response to an inspection demand.

Checkr does not dispute and appears to concede that, throughout the dispute at issue in the Checkr Set Two Motion and Checkr Protective Order Motion, Checkr represented to plaintiffs and the Court that once a protective order was entered, it would produce documents responsive to the Checkr Set Two Demand. (See, e.g., Gegne Decl., ¶¶ 3, 5, 8.) Checkr offers no information or evidence to show that it stated or indicated any intent to produce incomplete or redacted copies of documents responsive to the Checkr Set Two Demand, notwithstanding whether the Court granted the Checkr Protective Order Motion. Checkr also fails to offer any reasoned legal or factual argument showing why any of the Court’s orders entered with respect to the Checkr Protective Order Motion or the Checkr Set Two Motion, as further described above, authorize Checkr to produce incomplete or redacted copies of documents requested in the Checkr Set Two Demand.  

Moreover, the December 13 Order expressly directs Checkr to produce “complete” copies of documents responsive to the Checkr Set Two Demand considering the entry of the Protective Order. Though the December 13 Order leaves little room for interpretation with respect to whether the Court authorized Checkr to produce an incomplete or redacted copy of any documents responsive to the Checkr Set Two Demand, Checkr perplexingly asserts that, notwithstanding the entry of the Protective Order and Checkr’s representations to plaintiffs and the Court further discussed above regarding its anticipated production of documents pursuant to the Protective Order, it understood that it could nonetheless produce redacted copies of documents, and that the issue of redactions to the MSA remained undetermined.

Checkr states in the motion that it “agrees to comply with any order by the Court to pay some or all of the requested monetary sanctions.” (Memorandum at p. 2, ll. 21-24.) For all reasons further discussed above, the production by Checkr of the MSA with redactions violates the December 13 Order, which requires that Checkr produce a complete copy of the MSA. In addition, the arguments offered by Checkr and further detailed above are wholly insufficient to demonstrate any justification for Checkr’s failure to comply with the December 13 Order. For these reasons, the Court will grant the January 3 Motion as to the request of plaintiffs for an award of monetary sanctions against Checkr.

An award of monetary sanctions must be “reasonable under the circumstances ….” (Mattco Forge, Inc. v. Arthur Young & Co. (1990) 223 Cal.App.3d 1429, 1437; Code Civ. Proc., § 2023.030, subd. (a) [monetary sanctions may be awarded to compensate a party for reasonable expenses].) “The principle of reasonableness means a trial court has discretion to reduce the amount of fees and costs requested as a discovery sanction in order to reach a reasonable award.” (Cornerstone Realty Advisors, LLC v. Summit Healthcare Reit, Inc. (2020) 56 Cal.App.5th 771, 791.)

The declaration of plaintiffs’ counsel, Douglas S. Wacker (Wacker), submitted in support of the January 3 Motion, demonstrates that the sanctions requested by plaintiffs include 19.5 hours of counsel’s time to draft the January 3 Motion and, presumably, the ex parte application. (Wacker Decl., ¶ 9.) Considering the substance of the January 3 Motion and ex parte application, which do not address a large number of discovery requests or present complex issues of law or fact, the Court finds that the time expended by counsel to prepare the motion is excessive.

Under the totality of the circumstances present here, including the Court’s experience with addressing attorney’s fee requests, the Court finds that 8.9 hours of time for attorney Wacker at counsel’s reasonable rate of $500, for a total of $4,450, constitutes the reasonable amount of attorney’s fees incurred by plaintiffs as a result of the January 3 Motion, the ex parte application, and the misuse of the discovery process by Checkr, and for which monetary sanctions are appropriately awardable.

Plaintiffs also request an order prohibiting Checkr from opposing any liability for the damages claimed by plaintiffs in this action. Issue sanctions are generally authorized under Code of Civil Procedure section 2031.310, subdivision (i). “The award of discovery sanctions is a matter within the trial court’s discretion” and should be “ ‘ “ ‘appropriate to the dereliction, and should not exceed that which is required to protect the interests of the party entitled to but denied discovery.’ ” ’ ” (Karz v. Karl (1982) 137 Cal.App.3d 637, 648; Lopez v. Watchtower Bible & Tract Society of New York, Inc. (2016) 246 Cal.App.4th 566, 604.)

Notwithstanding that an award of monetary sanctions is justified under the circumstances present here, there is no evidence or information to demonstrate that, at this stage of the proceedings, a less severe sanction would curb Checkr’s misuse of the discovery process. The undisputed information and evidence further detailed above also shows that Checkr has producing an unredacted copy of the MSA. For this reason, the Court finds that the issue sanction requested by plaintiffs are not appropriate or presently warranted. Therefore, the Court will deny the January 3 Motion as to plaintiffs request for an issue sanction.

The Court has reviewed the proposed order submitted by plaintiffs and does not intend to sign it. The Court will order plaintiffs to submit a revised or corrected proposed order which accurately reflects the Court’s ruling herein.

Procedural matters:

Court records reflect that plaintiffs have lodged exhibits 4 and 5 to the January 3 Motion under seal, based on Checkr having designated these materials as confidential pursuant to the Protective Order. (Memorandum at p. 8, ll. 3-8; Wacker Decl., ¶¶ 4-5.)

“A record must not be filed under seal without a court order. The court must not permit a record to be filed under seal based solely on the agreement or stipulation of the parties.” (Cal. Rules of Court, rule 2.551(a).) To the extent a party to this action requests that a record be filed under seal, that party is required to, among other things, file a procedurally appropriate motion for an order sealing that record which “must be accompanied by a memorandum and a declaration containing facts sufficient to justify the sealing.” (Cal. Rules of Court, rule 2.551(b)(1).)

The Court has not entered, and presently declines to enter, an order authorizing any records in this action to be placed under seal. Though the lodging of exhibits 4 and 5 under seal does not prevent the Court from determining the issue of sanctions raised in the January 3 Motion, the parties are requested to note that, in the absence of an appropriate motion or application, the Court will deem as missing from its records any material or information which is filed or lodged under seal and submitted as basis for adjudication of matters other than discovery, including at trial. (In re Marriage of Tamir (2021) 72 Cal.App.5th 1068, 1085.) The parties are reminded of their obligation to comply with court rules.