Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_05-cv-01207/USCOURTS-casd-3_05-cv-01207-13/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1441 Petition for Removal- Breach of Contract

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- 1 - 05cv1207

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

MANAL NAOOM dba L.T.M. AUTO

SALES; et al.,

Plaintiffs,

CASE NO. 05-CV-1207 H

(CAB)

ORDER:

(1) GRANTING

DEFENDANTS’ RENEWED

APPLICATION FOR

DISCOVERY SANCTIONS AS

TO PLAINTIFF

MOUSAVINIA, DISMISSING

MOUSAVINIA’S CLAIMS,

AND ENTERING DEFAULT

AGAINST MOUSAVINIA ON

SAIF, INC.’S

COUNTERCLAIMS;

(2) TAKING DEFENDANTS’

APPLICATION UNDER

SUBMISSION AS TO

PLAINTIFF

KHOMAMIZADEH; AND

(3) DENYING DEFENDANTS’

APPLICATION AS TO

PLAINTIFF KASHANI

(Doc. No. 160.)

vs.

SECURED ASSETS INCOME

FUNDS, an unknown entity; et al.,

Defendants.

SAIF, INC., a California corporation,

et al.,

Counter-Claimant,

 vs.

MANAL NAOOM dba L.T.M. AUTO

SALES; et al., 

Counter-Defendants.

Case 3:05-cv-01207-H-CAB Document 189 Filed 11/08/06 Page 1 of 6
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- 2 - 05cv1207

On October 27, 2006, Defendants and Counterclaimant SAIF, Inc. (collectively,

“Defendants”) filed a renewed application for discovery sanctions against Plaintiffs

Javad Mousavinia, d/b/a Cars ‘R’ Us, Mehran Khomamizadeh, d/b/a Car Mart, and

Afshin Kashani, d/b/a Auto Finance Group. (Doc. No. 160.) Plaintiffs filed their

opposition on November 3, 2006. (Doc. No. 174.) Defendants filed a reply on

November 5, 2006. (Doc. No. 176.) The Court heard oral argument on Defendants’

application on November 6, 2006. Richard Miller and Robert Reynolds appeared for

Plaintiffs. Richard Van Dyke appeared for Defendants.

1. Plaintiff Javad Mousavinia, d/b/a Cars ‘R’ Us

Defendants first sought terminating sanctions against Plaintiff Mousavinia in

their original application, filed on September 6, 2006. (Doc. No. 83.) On October 11,

2006, the Court entered an order in which it declined to impose sanctions at that time,

but ordered Mousavinia to appear for deposition no later than October 26, 2006.

Further, the Court ordered Mousavinia to produce redacted copies of the sales contracts

no later than October 19, 2006. The Court also warned Plaintiff Mousavinia that he

would be subject to sanctions if he failed to comply with the order.

In this renewed application, Defendants seek sanctions against Plaintiff

Mousavinia for failing to appear for the court ordered deposition and for failing to

produce the court ordered sales contracts. Defendants ask the Court to dismiss all

claims brought by Mousavinia and to enter default against him on all counterclaims

brought by SAIF, Inc.

Plaintiffs’ counsel, Richard Miller, indicates in his opposition that Mousavinia

has been in Iran and cannot appear in person. Instead, Mr. Miller states that Mousavinia

has offered to appear by telephone for deposition. Mr. Miller also asks the Court to

grant a protective order allowing Mousavinia to appear for deposition by telephone. In

their reply, Defendants indicate that Mousavinia has never offered to appear by

telephone, but has only offered to respond to written questions by mail.

/ / / /

Case 3:05-cv-01207-H-CAB Document 189 Filed 11/08/06 Page 2 of 6
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- 3 - 05cv1207

Plaintiff Mousavinia filed this case against Defendants and chose to bring suit in

San Diego County. Given that trial is set to begin November 21, 2006, the Court

reasonably required Plaintiff Mousavinia to appear for deposition no later than October

26, 2006, less than four weeks before trial, so that Defendants could prepare their

defense. Absent a stipulation, the Court declines to order Defendants to depose Plaintiff

Mousavinia by telephone.

As to the sales contracts, Plaintiffs’ counsel indicates that Mousavinia’s

documents have been destroyed and cannot be produced, but he has not provided any

evidence or current sworn statement from Mousavinia. On August 12, 2005, Magistrate

Judge McCurine ordered Plaintiffs to produce sales contracts with redacted social

security numbers. (Doc. No. 11.) Similarly, on June 19, 2006, Magistrate Judge

Bencivengo ordered Plaintiffs to provide the redacted sales contracts for inspection and

copying no later than July 14, 2006. (Doc. No. 49.) Magistrate Judge Bencivengo

explicitly warned the parties that failure to comply with the order would result in

sanctions. 

Rule 37 of the Federal Rules of Civil Procedure authorizes a court to dismiss any

part of an action or to render judgment by default against a party who fails to appear for

a court ordered deposition. See Fed. R. Civ. P. 37(b)(2)(C) & (d). The Ninth Circuit

has set forth the following five part test for determining when dismissal sanctions are

just: “(1) the public's interest in expeditious resolution of litigation; (2) the court's need

to manage its dockets; (3) the risk of prejudice to the [party seeking sanctions]; (4) the

public policy favoring disposition of cases on their merits; and (5) the availability of

less drastic sanctions.” Valley Eng’rs, Inc. v. Elec. Eng’g Co., 158 F.3d 1051, 1057

(9th Cir. 1998). Because the first and second factors typically support sanctions while

the fourth disfavors dismissal, prejudice to the moving party and the availability of less

drastic sanctions, the third and fifth factors, are usually decisive. Id. The Ninth Circuit

has indicated “that factor 5 involves consideration of three subparts: whether the court

explicitly discussed alternative sanctions, whether it tried them, and whether it warned

Case 3:05-cv-01207-H-CAB Document 189 Filed 11/08/06 Page 3 of 6
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- 4 - 05cv1207

the recalcitrant party about the possibility of dismissal.” Id. (citing Malone v. U.S.

Postal Serv., 833 F.2d 128, 132 (9th Cir.1987)). Nevertheless, “despite all this

elaboration of factors, [the Ninth Circuit has] said that it is not always necessary for the

court to impose less serious sanctions first, or to give any explicit warning.” Id. (citing

Adriana Int’l Corp. v. Thoeren, 913 F.2d 1406, 1413 (9th Cir. 1990)).

Looking at the Valley Engineers factors, as the Ninth Circuit noted, the first and

second factors weigh in favor of dismissal here, while the fourth factor disfavors

dismissal. Looking at the third factor, the risk of prejudice to Defendants is high. Trial

is now scheduled to begin in less than two weeks. If the Court does not terminate

Plaintiff Mousavinia, he could surprise Defendants by returning on the eve of trial to

assert his claims without having complied with his court ordered discovery obligations.

Defendants have had no opportunity to depose Mousavinia and fully prepare a defense

before trial, and they have not seen the underlying sales contracts for the vehicles.

Similarly, Mousavinia’s repeated failure to appear for deposition and repeated failure

to produce the sales contracts have deprived SAIF, Inc. of its right to prepare its case

against him. 

Turning to the fifth factor, the availability of less drastic sanctions, the Court has

not only discussed alternative, less drastic sanctions, but it declined to impose any

sanctions at all in response to Defendants’ first application. Further, this Court

specifically warned Plaintiff Mousavinia that he would face sanctions if he failed to

comply with this Court’s order. Under these circumstances, terminating sanctions are

appropriate. See, e.g., Valley Eng’rs, 158 F.3d at 1057. 

Accordingly, the Court DISMISSES Plaintiff Mousavinia’s claims against

Defendants. Further, the Court STRIKES Mousavinia’s answer and enters DEFAULT

against him on SAIF, Inc.’s counterclaims. SAIF, Inc. still must prove sufficiently any

damages.

/ / / /

/ / / /

Case 3:05-cv-01207-H-CAB Document 189 Filed 11/08/06 Page 4 of 6
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2. Plaintiff Mehran Komamizadeh, d/b/a Car Mart

Defendants seek sanctions against Plaintiff Khomamizadeh for failing to produce

sales contracts. Specifically, Defendants ask the Court to enter an order deeming as

admitted SAIF, Inc.’s 15th and 27th causes of action and the factual allegations in 

¶ 180 of SAIF, Inc.’s First Amended Countercomplaint. In response, Plaintiffs state

that Khomamizadeh does not possess any documents, as he has turned them over to the

California Department of Motor Vehicles. In support of their opposition, Plaintiffs

include an April 8, 2005 declaration from Khomamizadeh responding to a request for

production of documents. In this declaration, Khomamizadeh states that he turned over

any documentation belonging to the California Department of Motor Vehicles, and that

any and all documents relating to his car dealership either do not exist, have been

destroyed, or have been wrongfully removed by a representative of Defendants Thomas

Sterling and SAIF, Inc. Plaintiff Khomamizadeh has not provided a declaration in

response to Defendants’ current application for sanctions.

As noted above, both Magistrate Judge McCurine and Magistrate Judge

Bencivengo ordered Plaintiffs to produce redacted sales contracts. (See Doc. Nos. 11

& 49.) Similarly, in response to Defendants’ first application for discovery sanctions,

although this Court declined to impose sanctions at that time, it ordered Plaintiff

Khomamizadeh to produce copies of the redacted sales contracts no later than October

19, 2006 or face sanctions. (Doc. No. 147.) Khomamizadeh has not produced any sales

contracts.

Nevertheless, at this time, the Court will take Defendants’ application as to

Plaintiff Khomamizadeh under submission. Plaintiff Khomamizadeh shall submit a

current declaration indicating whether the documents currently exist and where they are

located, and if they no longer exist, he must provide the reasons why the documents no

longer exist. The Court will consider not allowing Plaintiff Khomamizadeh to present

evidence related to the sales contracts at trial, and the Court reserves the right to impose

monetary sanctions or any other appropriate sanction.

Case 3:05-cv-01207-H-CAB Document 189 Filed 11/08/06 Page 5 of 6
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3. Plaintiff Afshin Kashani, d/b/a Auto Finance Group

Defendants also seek discovery sanctions against Plaintiff Kashani for failing to

appear for a court ordered deposition. In response to Defendants’ previous application

for discovery sanctions, this Court ordered Kashani to appear for deposition no later

than October 26, 2006. (Doc. No. 146.) Kashani has not appeared for deposition, but

on October 25, 2006, Kashani filed a bankruptcy petition. Although this petition stays

any claims against Kashani, it does not stay his claims against Defendants.

Accordingly, Defendants ask the Court to strike his claims against Defendants.

The Court DENIES Defendants’ application for sanctions against Plaintiff

Kashani. The parties agreed at oral argument that, notwithstanding the bankruptcy stay,

Kashani is still subject to deposition regarding his claims against Defendants.

Accordingly, as indicated at oral argument, the Court ORDERS the parties to meet and

confer with the bankruptcy trustee regarding how to proceed as to Plaintiff Kashani’s

claims against Defendants. The parties shall provide the Court with an update regarding

the results of the meeting with the trustee. 

 IT IS SO ORDERED. 

DATED: November 8, 2006

MARILYN L. HUFF, District Judge

UNITED STATES DISTRICT COURT

COPIES TO:

Richard S. Van Dyke, Esq.

Van Dyke & Associates

Faraday Business Park

5741 Palmer Way, Suite B

Carlsbad, CA 92008

Richard P. Miller, Esq.

Law Offices of Richard P. Miller

2207 Garnet Avenue, Suite N

San Diego, CA 92109 

Case 3:05-cv-01207-H-CAB Document 189 Filed 11/08/06 Page 6 of 6