Danzig v. Superior Court

• Citation: 151 Cal.Rptr. 185,87 Cal.App.3d 604
• Court: California Court of Appeals Court of Appeals
• Decision Date: 21 December 1978
• Parties: Paul DANZIG, Louis Degen, Harold J. Goldenberg, Robert Russell, and Carl Zwerner, Individually and on behalf of all other persons similarly situated, Petitioners, v. SUPERIOR COURT of the State of California FOR the COUNTY OF ALAMEDA, Respondent; JACK GRYNBERG AND ASSOCIATES, a sole proprietorship, Jack Grynberg and Celeste Grynberg, Real Parties in Interest. Civ. 43790.

Page 185

151 Cal.Rptr. 185

87 Cal.App.3d 604

Paul DANZIG, Louis Degen, Harold J. Goldenberg, Robert Russell, and Carl Zwerner, Individually and on behalf of all other persons similarly situated, Petitioners, v. SUPERIOR COURT of the State of California FOR the COUNTY OF ALAMEDA, Respondent;

JACK GRYNBERG AND ASSOCIATES, a sole proprietorship, Jack Grynberg and Celeste Grynberg, Real Parties in Interest.

Civ. 43790.

Court of Appeal, First District, Division 3, California.

Dec. 21, 1978.

Bancroft, Avery & McAlister, Sandra J. Shapiro, Michele D. Robertson, San Francisco, for petitioners.

Brobeck, Phleger & Harrison, J. Stewart Harrison, Kelly C. Wooster, San Francisco, for real parties in interest.

FEINBERG, Associate Justice.

This class action suit is before us on a petition for a writ of mandate, prohibition, or other appropriate writ brought by plaintiffs below to direct the trial judge to withdraw his February 16, 1978 order, which provided that unnamed members of plaintiff class should answer certain interrogatories propounded by respondents (defendants in the trial court) and served upon counsel for named plaintiffs.

We hold that in order for a defendant to have discovery of unnamed members of a plaintiff class by means of interrogatories, the defendant must carry the burden of showing that (a) such interrogatories request only such information as is necessary to trial of the class issues in the case, (b) such information is not readily obtainable from other sources, and (c) the interrogatories are neither unduly burdensome nor promulgated for an improper purpose. Since the trial court placed that burden on respondent plaintiffs, we grant the relief here sought.

The underlying action in this case was brought by five limited partners of the Greater Green River Basin Drilling Program 72-73 limited partnership (GGRB), individually and on behalf of the class of all limited partners of said partnership, against the general partner, Jack Grynberg and Associates, and against Jack Grynberg and Celeste Grynberg. The complaint alleges fraudulent representations in the solicitation of the purchase of limited partnership subscriptions, breach of fiduciary duty, breach of the partnership agreement, fraudulent inducement to participate in a subsequent assessment, and enactment and application of an invalid and improper amendment to the partnership agreement. The class seeks distribution of partnership assets, an accounting, and damages. On the face of the complaint, it appears that most, if not all, of the representations alleged to be fraudulent are set out in various documents: namely, the partnership registration statement and prospectus, which were distributed to each potential partner, and a written statement which was sent to each partner along with a proposed amendment to the partnership agreement.

The plaintiff class (put at approximately 60 by petitioners and at approximately 53 by respondents) was certified by order of the trial court on February 3, 1976. It appears that none of the unnamed class members "opted out" of the action or sought to be represented by their own counsel. On or about September 28, 1977, defendants served the interrogatories, the subject of this petition, on counsel for the named plaintiffs. Each named plaintiff filed responses to the interrogatories, and plaintiffs also filed objections to the interrogatories insofar as they were directed to unnamed class members. On February 16, 1978, upon defendants' motion, the trial court ruled that all unnamed class members would be required to respond separately to the interrogatories. (That order has been stayed pending disposition of this petition.) Ultimately, the Supreme Court granted the plaintiff's petition for a hearing, remanded the case to this court with instructions to grant an alternative writ of mandamus.

Forty detailed interrogatories were directed to the entire plaintiff class to be answered separately by each class member. The trial court ordered that 35 of these interrogatories be answered. As characterized by defendants, these interrogatories to be answered fall roughly into three groups: (1) those directed at defining precisely who the unnamed class members are; (2) those directed at determining upon what information each limited partner relied in joining the partnership, and in consenting or not consenting to the amendment to the partnership agreement; and (3) to what extent each partner's interest in the partnership has been diluted, as alleged in the complaint.

A. California law is silent as to whether each member of a plaintiff class can be required to answer interrogatories propounded by the defendant.

Section 2030, subdivision (b)(1) (presently section 2030, subdivision (a)) of the Code of Civil Procedure, ¹ at times relevant here, provided, inter alia, that interrogatories may be served by any Party upon any other Party. The question, then, as framed by the parties to this action, is whether unnamed class members are "parties" within the meaning of section 2030, subdivision (b)(1) to whom interrogatories may be propounded.

Appellants urge that California statutes clearly prohibit interrogatories addressed to unnamed members of a class. Their argument it has the virtue of simplicity goes as follows: (1) Section 2030, subdivision (b)(1) ² provides that any Party may serve upon any other Party interrogatories. (2) In a class action suit, the unnamed members of the class are not Parties. (3) Therefore, interrogatories may not be propounded to such unnamed members of the class.

As in most syllogistic reasoning, the error, and we believe there to be error, lies not in the reasoning but in the truth or lack thereof of the premises.

Beyond question, proposition (1) above is correct; interrogatories can only be propounded to parties under section 2030, subdivision (b)(1).

The problem lies with the second proposition above. Both sides agree there is no reported California case squarely on point nor have we been any more successful in finding such a case. Appellants rely upon Southern California Edison Co. v. Supreme Court (1972) 7 Cal.3d 832, 103 Cal.Rptr. 709, 500 P.2d 621, but their reliance is misplaced. The question in Southern California Edison was whether a defendant can depose unnamed members of the plaintiff class upon notice to counsel for the named plaintiffs, or whether such deponents must be subpoenaed. Section 2019, subdivision (a)(4) provides that service of a subpoena is Not required in order to depose a party Or a person for whose immediate benefit an action is prosecuted. In Southern California Edison, the court addressed the question of whether unnamed class members are "persons 'for whose immediate benefit an action or proceeding is prosecuted,' " and determined that unnamed class members are in that category. The court did Not address the question of whether unnamed class members are "parties" within the meaning of section 2019, subdivision (a)(4), or in any other context.

Petitioners argue that the court in Southern California Edison would not have devoted so much of that opinion to determining that unnamed class members are "persons for whose immediate benefit an action or proceeding is prosecuted" if such class members are also "parties." In effect, petitioners contend our high court impliedly held that unnamed class members are Not parties.

The argument suffers from a logical fallacy. When a proposition is in the form of two alternatives, if one alternative is false, then the other alternative must be true. But, if one of the alternatives is true, nothing can be said about the truth or falsity of the other alternative except in the situation when the two alternatives are mutually exclusive.

In Southern California Edison, the Supreme Court holding that unnamed members of a class represented by the named plaintiffs were persons for whose benefit the action was being prosecuted tells us nothing as to whether unnamed members of a class in a class action are "parties" within the meaning of section 2019, subdivision (a)(1), unless a "party" and "a person for whose immediate benefit an action or proceeding is prosecuted or defended" are mutually exclusive concepts. Since it appears obvious that the two concepts are not mutually exclusive, we conclude that Southern California Edison is not authority for the resolution of the issue at bar.

Respondents, on the other hand, suggest that since section 382, ³ the statutory aegis for this class action, provides "when the parties are numerous, and it is impracticable to bring them all before the court, one or more may sue or defend for the benefit of all," section 382 has designated class members named or not as "parties." Respondents have overlooked, however, the preceding portion of that expression so that the entire relevant provision of the section reads as follows: "(W)hen the question is one of a common or general interest, of many Persons, or when the Parties are numerous, and it is impracticable to bring them all before the court, one or more may sue or defend for the benefit of all." (Emphasis added.) Thus, one can equally argue that unnamed class members are Persons and not parties.

Respondent cites Daar v. Yellow Cab Co. (1967) 67 Cal.2d 695, 704, 63 Cal.Rptr. 724, 433 P.2d 732 as holding unnamed class members to be parties. Daar did consider section 382 but it did not address itself to any distinction between "persons" and "parties" in section 382. In fact, Daar, referring to section 382 in one place, speaks of "parties" (at p. 704, 63 Cal.Rptr. 724, 433 P.2d 732) and in another place, speaks of "many persons" or "numerous parties" (at p. 707, 63 Cal.Rptr. 724, 433 P.2d 732).

Suffice it to say, therefore, that respondents' argument in this aspect leaves us less than convinced.

B. Federal cases construing relevant portions of rule 33, Federal Rules of Civil Procedure, are persuasive authority in this case.

The pertinent language...