TVBI Company Limited v. Hong Thoa Thi Pham

Filing 88

ORDER RE DISCOVERY DISPUTE (Illston, Susan) (Filed on 3/18/2019)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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TVBI COMPANY LIMITED,
Plaintiff,

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United States District Court
Northern District of California

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Case No. 17-cv-05858-SI
ORDER RE DISCOVERY DISPUTE

v.

Re: Dkt. Nos. 84, &, 87
HONG THOA THI PHAM, et al.,
Defendants.

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Before the Court are the parties’ joint statements regarding a discovery dispute. Dkt. No. 84

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and 87. While the parties have resolved most of their disputes, one remains, namely: whether

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defendant Hong Thoa Thi Pham should produce her personal tax returns for the years 2014-2018.

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Plaintiff TVBI Company Limited (“TVBI”) requested an informal discovery conference regarding

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this issue. Having considered the arguments submitted in the parties’ joint statements, the Court

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finds the matter appropriate for immediate resolution.

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Defendants argue that (1) Ms. Pham’s personal tax returns are private, (2) the returns are

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irrelevant, and (3) since Lido and Ms. Pham are separate and distinct, Lido’s tax returns are

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sufficient and have been produced. These arguments fail.

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First, Ms. Pham admitted in her answer to the second amended complaint (“SAC”) that she

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is Lido’s sole shareholder, officer, and director – giving her complete control over the entity. Dkt.

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39 ¶ 5. Second, the SAC alleges that Ms. Pham transferred the income, revenues, and assets of Lido

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Night Club to herself and/or other persons/entities. Dkt. No. 32 ¶¶ 23-24, 44-46, 59-61, 69, 75-77,

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88-90. The SAC goes on to allege that Ms. Pham used that money for her own personal use,

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“including payment of her personal taxes and child support obligations, and to acquire, maintain,

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and improve or pay taxes related to other properties she owned…” Id. ¶¶ 76-77, 89-90. Thus, Lido’s

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tax returns alone are insufficient to fulfill plaintiff TVBI’s request, Ms. Pham’s tax returns are

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relevant, and the request for said returns is reasonably calculated to lead to discovery of admissible

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evidence. FRCP 26(b).
Finally, Ms. Pham has waived the privilege with respect to her tax returns. There is no

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federal privilege for tax returns and, while California does recognize such a privilege, it is not

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absolute. “The privilege is waived or does not apply in three situations: (1) there is an intentional

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relinquishment (2) the gravamen of [the] lawsuit is so inconsistent with the continued assertion of

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the taxpayer’s privilege as to compel the conclusion that the privilege has in fact been waived, or

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(3) a public policy greater than that of confidentiality of tax returns is involved.” Schnabel v.

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Superior Court, 5 Cal. 4th 704, 721, 854 (1993) (internal citations and quotations omitted). Lido

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United States District Court
Northern District of California

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has already produced its tax returns – admitting they are relevant and intentionally relinquishing

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them. Therefore, and considering the facts discussed above, Ms. Pham’s personal tax returns are

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also relevant and should be produced.

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CONCLUSION

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Plaintiff TVBI has stated that it is willing to enter into a protective order to ensure Ms.

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Pham’s confidentiality. The Court hereby orders Ms. Pham to produce her personal tax returns for

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years 2014-2018 no later than March 22, 2019. If the parties submit a proposed protective order

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prior to that date, the Court will review and approve it.

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IT IS SO ORDERED.
Dated: March 18, 2019
______________________________________
SUSAN ILLSTON
United States District Judge

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