Case Number: BC635131    Hearing Date: November 01, 2018    Dept: 24

Plaintiffs Marsha Tracy and Aram Kazazian’s motion for an order permitting pretrial discovery of Defendant Brian Song’s financial condition is GRANTED.

Background:

            On September 22, 2016, Plaintiffs Marsha Tracy (“Tracy”) and Aram Kazazian (“Kazazian”) (collectively Plaintiffs) filed the instant suit against Defendant Brian Song (“Defendant” or “Song”) for libel, slander and intentional infliction of emotional distress. On March 9, 2018, Plaintiff filed a First Supplemental Complaint (“FSC”), alleging the same causes of action. On May 8, 2018, Defendant filed a special motion to strike the FSC. On June 4, 2018, the Court denied Defendant’s motion to strike on all but one paragraph of the FSC., holding that Plaintiffs submitted sufficient evidence to demonstrate a reasonable probability of success on the merits on the majority of their allegations.

            On August 29, 2018, Plaintiff filed the instant motion for an order permitting pretrial discovery of Defendant’s financial condition pursuant to Civ. Code section 3295. On September 14, 2018, Defendant filed an opposition. On September 20, 2018, Plaintiff submitted a reply. The Court continued the motion to November 1, 2018.

            Plaintiffs’ complaint arises from allegations that since mid-2016, Song engaged in a campaign to unseat them from the Rancho San Rafael Community Association Board (the “Board”) so that he may control the Board and its reserves. Song’s campaign allegedly consisted of threats, intimidation, and harassment of Plaintiffs, including numerous defamatory statements about Plaintiffs, both orally and in writing. Song allegedly accused Plaintiffs of embezzlement, fraud, theft and forgery. Some of these were made through Song’s independent newsletter, which he distributes through a Gmail account. Song has also created several Gmail accounts under pseudonyms to attack Plaintiffs.

Analysis

Evidentiary Issues

            Defendant’s objections to the Kazazian Declaration nos. 1-14 are OVERRULED. The declarant does not lack personal knowledge or foundation, and the evidence is not hearsay or subject to the opposing party exception.

            Defendant’s objections to the Strom Declaration nos. 1-3 are OVERRULED for the same reasons.

            Defendant’s objection to the Fitzgerald Declaration is OVERRULED for the same reasons.

            Defendant’s objections to the Tracy Declaration nos. 11-12 are SUSTAINED on hearsay grounds as to Hunter and Park’s statements. The remainder are OVERRULED for the same reasons address above, and additionally because the declaration is not made upon information and belief.

Legal Standard

“No pretrial discovery by the plaintiff shall be permitted with respect to the evidence referred to in paragraphs (1) and (2) of subdivision (a) unless the court enters an order permitting such discovery pursuant to this subdivision. However, the plaintiff may subpoena documents or witnesses to be available at the trial for the purpose of establishing the profits or financial condition referred to in subdivision (a), and the defendant may be required to identify documents in the defendant’s possession which are relevant and admissible for that purpose and the witnesses employed by or related to the defendant who would be most competent to testify to those facts. Upon motion by the plaintiff supported by appropriate affidavits and after a hearing, if the court deems a hearing to be necessary, the court may at any time enter an order permitting the discovery otherwise prohibited by this subdivision if the court finds, on the basis of the supporting and opposing affidavits presented, that the plaintiff has established that there is a substantial probability that the plaintiff will prevail on the claim pursuant to Section 3294. Such order shall not be considered to be a determination on the merits of the claim or any defense thereto and shall not be given in evidence or referred to at the trial.” (Civ. Code, § 3295(c).)

“Against this backdrop of legislative intent, in which protecting the financial privacy of defendants is paramount, we interpret the language of section 3295(c), requiring the trial court to find based on supporting and opposing affidavits that the plaintiff has established there is a substantial probability he will prevail on his claim for punitive damages, to mean that before a court may enter an order permitting discovery of a defendant’s financial condition, it must (1) weigh the evidence submitted in favor of and in opposition to motion for discovery, and (2) make a finding that it is very likely the plaintiff will prevail on his claim for punitive damages. In this context, we interpret the words ‘substantial probability’ to mean ‘very likely’ or ‘a strong likelihood’ just as their plain meaning suggests. We note that the Legislature did not use the term ‘reasonable probability’ or simply ‘probability,’ which would imply a lower threshold of ‘more likely than not.’ ” (Jabro v. Superior Court (2002) 95 Cal.App.4th 754, 758.)

Discussion

            Here, Plaintiffs contends that there is a substantial probability that it will prevail on the merits of their claims, thereby entitling them to punitive damages based on malice.

“The elements of a defamation action are (1) a publication that is (2) false, (3) defamatory, (4) unprivileged, and (5) has a natural tendency to injure or causes special damage. (Wong v. Tai Jung (2010) 189 Cal. App. 4th 1354, 1369.) There are two forms of defamation: libel and slander. (Civ. Code § 44.) Only statements of fact are actionable as defamation. (Raghavan v. Boeing Corp.(2005) 133 Cal. App.4th 1354, 1369.) Statements of opinion that do not convey a false factual imputation are not actionable as a matter of law. (Kahn v. Bower (1991) 232 Cal.App.3d 1599, 1607.) Each separate defamatory statement gives rise to a new claim. (Shively v. Bozanich (2003) 31 Cal.4th 1230, 1242.)

“When a defamation action is brought by a public figure, the plaintiff, in order to recover damages, must show that the defendant acted with actual malice in publishing the defamatory communication.” (Denney v. Lawrence (1994) 22 Cal.App.4th 927, 933.) “The limited purpose public figure is an individual who voluntarily injects himself or herself or is drawn into a specific public controversy., thereby becoming a public figure on a limited range of issues.” (Ampex Corp. v. Cargie (2005) 128 Cal.App.4th 1569, 1577.) As previously held, the parties agree that Plaintiffs are limited public figures in the context of the Board. (See Cabrera v. Alam(2011) 197 Cal.App.4th 1077, 1092.)

Civil Code § 3294(a) provides that “[i]n an action for the breach of an obligation not arising from contract, where it is proven by clear and convincing evidence that the defendant has been guilty of oppression, fraud, or malice, the plaintiff, in addition to the actual damages, may recover damages for the sake of example and by way of punishing the defendant.” Civil Code § 3294(c) defines malice, oppression, and fraud as follows:

(1) “Malice” means conduct which is intended by the defendant to cause injury to the plaintiff or despicable conduct which is carried on by the defendant with a willful and conscious disregard of the rights or safety of others.

(2) “Oppression” means despicable conduct that subjects a person to cruel and unjust hardship in conscious disregard of that person’s rights.

(3) “Fraud” means an intentional misrepresentation, deceit, or concealment of a material fact known to the defendant with the intention on the part of the defendant of thereby depriving a person of property or legal rights or otherwise causing injury.

A defendant does not need to act intentionally for punitive damages to be found; a showing of malice is sufficient to support a claim for punitive damages. (Pfeifer v. John Crane, Inc. (2013) 220 Cal.App.4th 1270, 1299.) However, the statute “plainly indicates that absent an intent to injure the plaintiff, “malice” requires more than a “willful and conscious” disregard of the plaintiffs’ interests, additional component of “despicable conduct” must be found.” (Coll. Hosp. v. Superior Ct. (1994) 9 Cal.4th 704, 726 [emphasis added].) Despicable is a powerful term used to describe circumstances that are “base,” “vile,” or “contemptible.”  (Ibid.)

First, the court notes it cannot simply adopt its previous position during the anti-SLAPP motion. The two motions are separate, and require different, albeit similar, showings in the context of defamation. (See Christian Research Institute v. Alnor (2007) 148 Cal.App.4th 71, 76 [in anti-SLAPP, the public figure plaintiff must show defendant acted with “actual malice” by clear and convincing evidence].) Thus, the Court does not merely adopt its previous position, and will independently analyze the issues and evidence presented in context of the instant motion, and not against the anti-SLAPP standards. That said, the Court finds that there is sufficient evidence to establish the falsity of the underlying claims and malice within the context of a defamation suit, and that the recovery of punitive damages is highly likely.

Here, Plaintiffs proffers evidence of a myriad of examples of defamatory statements by Defendant. On June 6, 2017, Song sent an email falsely accusing Kazazian of bribing Yoon Kim. (S. Kim Decl., Ex. 4, pp.86-87; Ex. 5, p. 121; Song Depo. III, 288-289, Ex. 57.) On June 25, 2017, Song sent an email purporting to return to Plaintiffs a check used to bribe Yoon Kim. (C. Kim Decl., Ex. 4, pp.106-107; Ex. 5, p. 127; Song Depo. III, 311-312, Ex. 62.) On June 2, 20127, Song sent an email as “Yoon Kim” accusing Kazazian of being a thief and embezzler. (C. Kim Decl., Ex. 4, pp.79-83; Ex. 5, pp. 119-120; Song Depo. III, 281-285, Ex. 56.) Song caused to be published a series of defamatory emails as “John Smith” and Song admits that the email is controlled by his friend. (C. Kim Decl., Ex. 4 pp. 63-67, Ex. 5 p. 116; Song Depo III, 254-258, Ex. 52.) Song created false email using an Armenian surname to make it seem as though another Armenian accused Kazazian of wrongdoing.1 (C. Kim Decl., Ex. 4 pp. 56-57, Ex. 5 p. 112; Song Depo III:247-248, Ex. 51.) On July 29, 2016, Song sent a newsletter accusing Plaintiffs of being thieves (S. Kim Decl., Ex. A, pp. 8-10; C. Kim Decl., Ex. 1 p. 14, Ex. 2 pp.29-34; Song Depo I, 54, Ex. 5.) Song falsely told RSR HOA sprinkler supplier that Kazazian is under IRS investigation. (Jiminez Decl., ¶¶ 9-10, Exs. 5-6.) Song made repeated allegations that Plaintiffs rigged the 2015 board election. (Strom Decl., ¶¶ 11-13; Tracy Decl., ¶¶ 20-21, 25, Ex. 3; Kazazian Decl., ¶ 18.) Song’s allegations of criminal conduct, i.e. being thieves and embezzlers which Song admits he did not believe. (Fitzgerald Decl., ¶¶ 11, 15-16, 23-24, Ex. 23; C. Kim Decl., Ex. 4 p. 83; Song Depo III, 285; Strom Decl., ¶¶ 4-10, 15.)

Read together, the various publications may entitle Plaintiffs to punitive damages for the defamation claims, as the evidence establishes that Song made false statements that tend to injure Plaintiffs’ reputation. Further, a reasonable inference of the evidence is that Defendant intended to harm Plaintiffs with the various publications. The apparent attempt to discredit and harm Plaintiffs’ interests by the false accusations of bribery, rigging the election, and other acts of defamation detailed above demonstrate that Defendant acted despicably, with a willful intent to injure the rights of Plaintiffs.

Defendant brings his own declaration and supporting documents related to alleged self-dealing with Wilson Maintenance. (Song Decl., ¶¶1-16; see Barrera Decl., Exs. 1-2, 7.) Defendant also brings attention to the deposition of a former board member, Elena Johnson, who had suspicions regarding Wilson Maintenance and Kazazian’s dealings. (Barrera Decl., Exs. 3-4.) While these potentially establish a defense as to particular defamatory statements related to embezzling, the majority of Plaintiff’s evidence is uncontested by Defendant. For example, the evidence establishing that Song made false statements that Yoon Kim paid Kazazian and Tracy cash for making false statements about Song are uncontested, as well as other evidence related to the bribery statements. Defendant also cites no authority that a meet and confer effort is required for this motion.

Accordingly, the Court finds that Plaintiffs have met their burden demonstrating a substantial probability that Plaintiffs will prevail on the claim for punitive damages. Therefore, Plaintiffs’ motion for an order permitting financial discovery as to Defendant is GRANTED. As Defendant requests, and Plaintiffs agree to stipulate, the discovery will be subject to a protective order. (Civ. Code § 3295(d).)

Moving party is ordered to give notice.

1 Though, the Court notes that this paragraph of the FSC was held to not be actionable. Plaintiffs correctly point out that this still may be evidence of Song’s overall intent and partially justify punitive damages.

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