Aerielle, LLC v Maximo Product, LLC

Filing 62

ORDER by Magistrate Judge Howard R. Lloyd denying 61 Aerielle LLC's Motion for an Order to Show Cause re Contempt and for Sanctions. (hrllc2, COURT STAFF) (Filed on 11/9/2012)

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1 2 *E-FILED: November 9, 2012* 3 4 5 6 NOT FOR CITATION 8 IN THE UNITED STATES DISTRICT COURT 9 FOR THE NORTHERN DISTRICT OF CALIFORNIA 10 SAN JOSE DIVISION 11 For the Northern District of California United States District Court 7 12 13 14 No. C10-03420 HRL AERIELLE, LLC, ORDER DENYING AERIELLE LLC’S MOTION FOR AN ORDER TO SHOW CAUSE RE CONTEMPT AND FOR SANCTIONS Plaintiff, v. MAXIMO PRODUCTS, LLC, [Re: Docket No. 61] 15 Defendant. / 16 17 Following a bench trial in this breach of contract action, the court entered judgment in 18 the amount of $163,871.07 for plaintiff Aerielle LLC (Aerielle). Additionally, pursuant to the 19 agreements at issue, Aerielle was awarded $27,780.66 in fees and $718.26 in costs incurred in 20 this litigation. The court subsequently granted Aerielle’s application for an order directing 21 defendant Maximo Products, LLC (Maximo) to appear for a judgment debtor exam. The 22 examination was set for October 16, 2012. Aerielle appeared on the designated date. Maximo 23 did not. 24 During the October 16 appearance, Aerielle’s counsel advised the court that defense 25 counsel sent her an email the day before, stating that Maximo would not appear for the 26 examination as ordered because the company will be dissolved. Arguing that this was not 27 sufficient reason to excuse Maximo’s appearance, Aerielle requested relief from the court. The 28 court noted that Aerielle had not filed a proof of service of the judgment debtor examination 1 order. And, in response to the court’s inquiry, Aerielle’s counsel stated that she did not 2 personally serve Maximo with that order. Instead, she allowed service to be made on Maximo’s 3 counsel of record, via the court’s CM/ECF system, upon filing of the order. The court 4 expressed doubt whether that was sufficient. Nevertheless, the court directed Aerielle to submit 5 a request in writing specifying the relief being sought, along with citations to relevant authority. 6 Aerielle subsequently filed a request for an order (1) directing Maximo to appear and attorney’s fees and costs incurred in connection with Maximo’s failure to appear (and making 9 such an award part of the judgment against Maximo); and (3) “remind[ing] Maximo that the 10 service of the examination order created a one-year lien on its nonexempt personal property, 11 For the Northern District of California show cause why it should not be held in contempt; (2) awarding Aerielle’s reasonable 8 United States District Court 7 whether or not such property is in Maximo’s possession and control, and that said lien extends 12 to property outside of California.” (Dkt. No. 61 at 2). Having reviewed Aerielle’s written 13 submission, and for the reasons discussed below, the court denies Aerielle’s request. 14 Rule 69 of the Federal Rules of Civil Procedure provides that “the judgment creditor or 15 a successor in interest whose interest appears of record may obtain discovery from any 16 person—including the judgment debtor—as provided in these rules or by the procedure of the 17 state where the court is located.” FED. R. CIV. P. 69(a)(2). California has a comprehensive 18 statutory scheme governing the enforcement of judgments, codified as Title 9 of the California 19 Code of Civil Procedure, including specific provisions pertaining to judgment debtor 20 examinations. Aerielle requested a judgment debtor exam pursuant to California Code of Civil 21 Procedure § 708.110. (See Dkt. No. 58). That statute provides that a judgment creditor may 22 apply “for an order requiring the judgment debtor to appear before the court, or before a referee 23 appointed by the court, at a time and place specified in the order, to furnish information to aid in 24 enforcement of the money judgment.” CAL. CODE CIV. PROC. § 708.110(a). 25 Under California law, a judgment debtor may be held in contempt for failure to appear 26 for a judgment debtor examination. CAL. CODE CIV. PROC. § 708.170(a)(1) (providing for 27 contempt or issuance of an arrest warrant for failure to appear for a debtor’s examination). 28 And, if the judgment debtor’s “failure to appear is without good cause, the judgment creditor 2 1 shall be awarded reasonable attorney’s fees incurred in the examination proceeding,” and such 2 an award “shall be added to and become part of the principal amount of the judgment.” Id. § 3 708.170(a)(2). 4 In this case, the court denies the relief Aerielle seeks because Aerielle failed to properly provides that “[t]he judgment creditor shall personally serve a copy of the order on the 7 judgment debtor not less than 10 days before the date set for the examination. Service shall be 8 made in the manner specified in Section 415.10.” CAL. CODE CIV. PROC. § 708.110(d). 9 California Code of Civil Procedure § 415.10, in turn, directs service to be made by personal 10 delivery to the person to be served. Id., § 415.10. Section 708.110 goes on to state that such 11 For the Northern District of California effect service of the judgment debtor order. California Code of Civil Procedure § 708.110 6 United States District Court 5 “[s]ervice of the order creates a lien on the personal property of the judgment debtor for a 12 period of one year from the date of the order, unless extended or sooner terminated by the 13 court.” Id. § 708.110(d). Further, state law requires that “when a writ, notice, order, or other 14 paper is required to be served under [Title 9 of the Code of Civil Procedure] on the judgment 15 debtor, it shall be served on the judgment debtor instead of the attorney for the judgment 16 debtor.” Id., § 684.020(a). There is an exception in situations where the judgment debtor files 17 and serves a request that service be made on a specified attorney, along with a signed consent 18 by the designated attorney. Id. § 684.020(b). There has been no such filing by Maximo here. 19 As discussed above, Aerielle did not personally serve the order requiring Maximo to 20 appear for a judgment debtor exam. Nor has counsel submitted any papers supporting its 21 request for fees and costs incurred in preparing for the judgment debtor examination. 22 Accordingly, Aerielle’s request for an order to show cause re contempt and for monetary 23 sanctions is denied. See Salamon v. Creditors Specialty Service, Inc., No. C11-00172CW, 2012 24 WL 4857810 (N.D. Cal., Oct. 11, 2012) (denying motion re contempt and monetary sanctions 25 where the judgment creditor failed to properly serve orders concerning the judgment debtor 26 27 28 3 1 2 3 examination and did not submit documentation supporting its request for fees and costs). SO ORDERED. Dated: November 9, 2012 4 HOWARD R. LLOYD 5 UNITED STATES MAGISTRATE JUDGE 6 7 8 9 11 For the Northern District of California United States District Court 10 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 4 1 5:10-cv-03420-HRL Notice has been electronically mailed to: 2 Margaret Anne Crawford 3 Paul Gerard Minoletti 4 William J. Frimel,,, 5 6 7 8 9 11 For the Northern District of California United States District Court 10 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 5

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