Liu et al v. Win Woo Trading, LLC et al
Filing
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ORDER by Judge Kandis A. Westmore denying Plaintiffs' 163 Motion for Sanctions against the Win Woo Defendants. (kawlc1, COURT STAFF) (Filed on 4/12/2016)
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UNITED STATES DISTRICT COURT
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NORTHERN DISTRICT OF CALIFORNIA
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KUANG XUAN LIU, et al.,
Case No. 14-cv-02639-KAW
Plaintiffs,
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v.
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WIN WOO TRADING, LLC, et al.,
Defendants.
ORDER DENYING PLAINTIFFS'
MOTION FOR SANCTIONS AGAINST
WIN WOO DEFENDANTS AND
COUNSEL
Re: Dkt. No. 163
United States District Court
Northern District of California
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On March 17, 2016, Plaintiffs filed a motion for sanctions against the Win Woo
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Defendants and their attorney of record, Margaret J. Grover, for allegedly perpetuating a fraud on
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the court in connection with Defendant Jia Tun Zheng’s declaration in support of Defendants’
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motions for summary judgment. (Pls.’ Mot., Dkt. No. 163 at 2.)
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Plaintiffs filed the motion pursuant to Federal Rule of Civil Procedure 56(h). Id. Rule
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56(h) permits the court to impose sanctions on a party who submitted an affidavit or declaration in
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support of a motion for summary judgment found to be in bad faith. Fed. R. Civ. P. 56(h). Here,
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Defendants withdrew their argument that Safety Trucking and Win Woo were separate businesses
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on March 10, 2016—seven days before the motion for sanctions was filed. (See Defs.’ Opp’n,
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Dkt. No. 165 at 3.) Further, Defendants contend that they were unaware that documents existed
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that created a triable issue of fact regarding the separation of the businesses when the motions for
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summary judgment were filed. Id. at 2. Since Defendants withdrew their argument shortly after
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becoming aware that time records existed that appeared to list Win Woo as the payor, there is no
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finding of bad faith under Rule 56.
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Alternatively, Plaintiffs may seek sanctions for the purported wrongdoing under Rule 11.
Rule 11 requires that a motion for sanctions “be served under Rule 5, but it must not be filed or be
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presented to the court if the challenged paper, claim, defense, contention, or denial is withdrawn or
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appropriately corrected within 21 days after service or within another time the court sets.” Fed. R.
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Civ. P. 11(c)(2). Here, Defendants contend that Plaintiffs did not serve the motion on opposing
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counsel before it was filed. (Decl. of Margaret J. Grover, Dkt. No. 165-1 ¶ 17.) Plaintiffs do not
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dispute this assertion, but instead contend that a meet and confer was not required because the
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motion was filed under Rule 56(h). (Pls.’ Reply, Dkt. No. 167 at 1.) The Court disagrees.
At the March 8, 2016 case management conference, the Court ordered Plaintiffs to meet
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and confer with the Win Woo Defendants prior to filing a motion for sanctions. Pursuant to the
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Northern District Guidelines for Professional Conduct, “[m]otions should be filed or opposed only
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in good faith and when the issue cannot be otherwise resolved.” (See Northern District Guidelines
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United States District Court
Northern District of California
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for Professional Conduct ¶ 10.) This requires that a party meet and confer prior to filing a motion
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for sanctions. See id. at ¶ 10(a). The Court admonishes Plaintiffs’ counsel for failing to comply
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with this court order and the district’s Guidelines, but declines to impose sanctions at this time.
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Plaintiffs are not to file any other motions prior to engaging in a good faith meet and confer effort.
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For the reasons set forth above, Plaintiffs’ motion for sanctions is DENIED.
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IT IS SO ORDERED.
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Dated: April 12, 2016
__________________________________
KANDIS A. WESTMORE
United States Magistrate Judge
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