Security National Guaranty, Inc. vs. Makhijani

Judgment Creditor has established good cause for the broad production. Evidence establishes Makhijani exercised control over entities holding accounts at Nano Banc. During meet-and-confer discussions, Nano Banc’s counsel conceded Makhijani was an authorized signatory on accounts at the bank and held ownership interests in entities that maintained accounts there. Finally, a recently unsealed federal criminal complaint charging Makhijani with bank fraud corroborates allegations Makhijani routinely holds and conceals his interests not in his own name, but through entities and nominees that he controls—making it likely that records relating to such interests are held at Nano Banc, even if the records are not held in Makhijani’s name only.

In its reply, Nano Banc argues Judgment Creditor’s attempt to tether the subpoena to Makhijani’s examination is a pretextual justification because Makhijani is currently incarcerated and there is virtually no chance he will be examined. Nano Banc also argues even if Makhijani appears at the examination, he will likely plead the Fifth like he did at trial.

These arguments lack merit. Judgment Creditor issued the subpoena less than two weeks after the court entered the order for Makhijani’s debtor’s examination. This timing indicates the subpoena is tethered to the examination. Further, there is no evidence Judgment Creditor knew or believed Makhijani likely would not appear for the examination when it issued the subpoena. Nano Banc’s speculation Makhijani likely will not appear or, if he does appear, will plead the Fifth, does not justify denying Judgment Creditor’s right to permissible discovery to enforce the judgment.

Third party privacy rights

“The party asserting a privacy right must establish a legally protected privacy interest, and objectively reasonable expectation of privacy in the given circumstances, and a threatened intrusion that is serious. [Citations.] The party seeking information may raise in response whatever legitimate and important countervailing interest disclosure serves, while the party seeking protection may identify feasible alternatives that serve the same interest or protective measures that would diminish the loss of privacy. A court must then balance these competing considerations.” (Williams v.

Sup. Ct. (2017) 3 Cal.5th 531, 552.) “Only obvious invasions of interests fundamental to personal autonomy must be supported by a compelling interest.” (Id. at p. 557.)

Nano Banc asserts a legally protected privacy interest in protecting its customers’ financial information that may be disclosed as a result of the subpoena. “[T]he right of privacy extends to one's confidential financial affairs as well as to the details of one's personal life . . .[T]he customer of a bank expects that the documents, such as checks, which he transmits to the bank in the course of his business operations, will remain private, and that such an expectation is reasonable. A bank customer's reasonable expectation is that, absent compulsion by legal process, the matters he reveals to the bank will be utilized by the bank only for internal banking purposes.” (Valley Bank of Nevada v. Superior Court (1975) 15 Cal.3d 652, 656-657 [cleaned up] (Valley Bank).)

In Valley Bank, a case cited by Nano Banc, the California Supreme Court balanced similar competing interests in the context of pending litigation and concluded “that before confidential customer information may be disclosed in the course of civil discovery proceedings, the bank must take reasonable steps to notify its customer of the pendency and nature of the proceedings and to afford the customer a fair opportunity to assert his interests by objecting to disclosure, by seeking an appropriate protective order, or by instituting other legal proceedings to limit the scope or nature of the matters sought to be discovered . . . [I]n evaluating claims for protection of bank customers, the trial courts are vested with the same discretion which they generally exercise in passing upon other claims of confidentiality.” (Valley Bank, supra, 15 Cal.3d at p. 658.) The considerations affecting the trial court’s exercise of its discretion include “the purpose of the information sought, the effect that disclosure will have on the parties and on the trial, the nature of the objections urged by the party resisting disclosure, and ability of the court to make an alternative order which may grant partial disclosure, disclosure in another form, or disclosure only in the event that the party seeking the information undertakes certain specified burdens which appear just under the circumstances.” (Ibid.)

Nano Banc made no effort to notify its customers of the subpoena and the nature of these proceedings.

Moreover, the consumer notice requirements do not apply where a records custodian is required to delete all information that would identify the consumer whose records are sought. (Code Civ. Proc., § 1985.3, subds. (b), (i); see Snibbe v. Sup.Ct. (Gilbert)(2014) 224 Cal.App.4th 184 [notice to patients not required prior to disclosure of redacted postoperative orders].)

During the meet and confer process, Judgment Creditor offered to allow Nano Banc to redact information related specifically to any third-party owners of the accounts to protect their privacy interests. Nano Banc declined.

In its reply, Nano Banc argues redaction cannot address the privacy issues because this is not a case where discreet pieces of financial information can simply be redacted. Nano Banc states Judgment Creditor offers no workable method for redacting the types of records it seeks. This argument is unpersuasive.

Nano Banc is ORDERED to redact the documents responsive to the subpoena and produce the redacted documents within 20 days.

Clerk to give notice.

6 Hazard vs. Motion for Attorney Fees and Costs General Motors, Plaintiff Reed Hazard’s Motion for Attorneys’ Fees, Costs, LLC and Expenses is GRANTED in the reduced amount of 30-2025- $18,259.40. 01459635-CU- BC-CJC Plaintiffs seek lodestar fees of $26,171.00 and costs of $2,442.69 for a total request of $28,613.69.

The court declines to reduce fees for plaintiff’s fraud claims, pre-engagement work, initial disclosures, redundant and excessive client communications, clerical and administrative tasks, and travel time.

The court finds 11.7 hours is excessive for fees in connection with the fee motion and reduces the fees by 8.7 hours ($4,900.00). The court also reduces hours by 6.4 for a motion to tax costs never filed ($4,448.00.)

The court declines to reduce costs for filing and motion fees and jury fees.

The court taxes costs of $41.20 for service of process; $550.00 for court reporter fees; $97.45 for electronic filing fees; $125.14 for mileage and parking; and $192.50 for mediation, on grounds plaintiff provided no