Opinion
H048795
01-24-2023
GLOBAL PROTEIN PRODUCTS, INC., Plaintiff and Respondent, v. KEVIN K. LE et al., Defendants and Appellants.
NOT TO BE PUBLISHED
Santa Clara County Super. Ct. No. 105CV043903
Danner, J.
Defendants and appellants Kevin K. Le and his company West Coast AG, LLC (together, Le) challenge the trial court's order denying Le's second motion to dissolve a permanent injunction that has been in force since 2006 (the injunction). The injunction prohibits Le from using a trade secret claimed by plaintiff and respondent Global Protein Products, Inc. (GPP) related to a food product for extending the shelf life of iceberg lettuce.
When referring solely to Kevin Le, we use the designation "Kevin Le."
This is the second appeal brought by Le challenging the injunction. In 2014, GPP initiated contempt proceedings against Le for alleged violations of the injunction. During the course of those proceedings, the trial court denied Le's motion to dissolve the injunction. Le appealed, and in 2019 this court rejected Le's challenge to the injunction. (Global Protein Products, Inc. v. Le (2019) 42 Cal.App.5th 352 (Global I).)
We granted GPP's request for judicial notice of the briefing and record on appeal in Global I.
In 2020, Le filed in the trial court a second motion to dissolve the injunction. Relying on Global I, the court ruled that Le's second motion should be denied under law of the case principles. The court also concluded that Le failed to establish the requirements to dissolve an injunction set forth in Code of Civil Procedure section 533.
Unspecified statutory references are to the Code of Civil Procedure.
On appeal, Le asserts the trial court erred in its ruling. GPP contends the trial court did not err and has filed in this court a motion for sanctions. As explained further below, we affirm the trial court's order and impose appellate sanctions against Le and his counsel.
I. FACTS AND PROCEDURAL BACKGROUND
We take the facts and procedural background from the published decision in Global I, the record in the present appeal, and the record on appeal in Global I.
A. The Parties
GPP makes protein-based coatings that increase the shelf life of fresh produce. GPP holds patents on some of its products and claims trade secrets for others, including a trade secret in a proprietary formula and process for treating field-cored iceberg lettuce.
Kevin Le is a scientist who worked for GPP from 2000 through 2003. During his employment at GPP, which included working as the head field scientist in GPP's California office, Kevin Le learned proprietary information about GPP's products, including the identity of the organic acid GPP uses on iceberg lettuce.
Kevin Le left GPP in 2003 and formed a company called West Coast AG, LLC (WCA). WCA claimed to have proprietary products that extended the shelf-life of fresh produce (including iceberg lettuce) and directly competed for business with GPP.
B. Initiation of Lawsuit and 2006 Stipulated Permanent Injunction
In 2005, GPP brought suit against Le. GPP filed an ex parte application for a temporary restraining order and an order to show cause for a preliminary injunction and a complaint for damages alleging trade secret misappropriation in violation of the Uniform Trade Secret Act, breach of the confidentiality agreement that Kevin Le had signed in connection with his employment at GPP, and unfair competition.
The trial court granted the temporary restraining order and order to show cause. The court subsequently granted a preliminary injunction in favor of GPP.
Following further litigation, the parties reached a settlement that included a stipulated permanent injunction, which the trial court entered on January 11, 2006. The injunction enjoined Le from certain acts and included a number of stipulated facts, including that "GPP claim[ed] as a trade secret a proprietary formula and process for treating field cored iceberg lettuce to increase shelf life of the lettuce ('GPP's Trade Secret product')" and "[t]he formulation of GPP's Trade Secret product and the identity of the organic acid used in the formulation and process were disclosed to Mr. Le during his employment at GPP."
The injunction permanently enjoined Le from (1) "Acquiring, disclosing, using, or attempting or threatening to acquire, disclose, or use, GPP's Trade Secret product, including any information relating to its formulation and process and the identity of the organic acid used in said product," (2) "Directly or indirectly soliciting any of GPP's customers using GPP's Trade Secret product and/or any information related thereto," and (3) "Doing any other act using GPP's Trade Secret or any other information subject to Mr. Le's Confidentiality Agreement with GPP in order to compete with GPP."
C. GPP's 2014 Contempt Proceedings Against Le
In 2014, GPP initiated contempt proceedings against Le for alleged violations of the injunction. GPP alleged in its ex parte application for an order to show cause that it had learned through Inn Foods, Inc. and its parent company VPS Companies, Inc. (collectively, VPS) that Le was violating the injunction. GPP alleged that Kevin Le had marketed to and provided VPS with certain shelf-life extender products and disclosed GPP's proprietary and confidential information.
VPS participated as intervenors in the lawsuit. VPS filed a complaint in intervention that alleged Kevin Le misappropriated GPP's shelf life extenders and falsely claimed to be the owner or inventor of the shelf life extenders that he had provided to VPS. (Global I, supra, 42 Cal.App.5th at p. 358.) VPS has not appeared in the current appeal.
The trial court granted the order to show cause regarding contempt (OSC). Le opposed the OSC. In the course of discovery, Le's attorney, David A. Berstein (Berstein), took the depositions of three GPP witnesses. In September 2015 Berstein deposed Bob Cyr (the then-current president and CEO of GPP). In May and June 2016, he deposed Anthony Jabar, Jr. (the former director of development at GPP) and Mark Kierstead (the founder and former president and CEO of GPP).
In July 2016, shortly following the depositions of the GPP witnesses, Le filed a motion to modify or dissolve the stipulated permanent injunction under section 533 (first motion to dissolve). Le argued the injunction was overly broad, vague, and uncertain. Additionally, Le asserted that newly discovered facts-that "citric acid" was the previously undisclosed organic acid in the stipulated permanent injunction- demonstrated that GPP's trade secret did not possess a commercial advantage, and GPP's trade secret was previously publicly disclosed in a patent.
Le's first motion to dissolve was accompanied by a declaration from Berstein. His declaration attached various exhibits, including excerpts from the depositions of Kierstead, Jabar, and Cyr. Le also submitted a declaration from Kevin Le.
In September 2016, the trial court denied Le's first motion to dissolve the stipulated permanent injunction, finding that Le failed to make the showing required under section 533. Le did not timely appeal the denial of his motion.
In December 2016, Le filed a renewed motion to modify or dissolve the stipulated permanent injunction under section 1008, subdivision (b) (renewed motion). The renewed motion was based on an admission GPP made in amended discovery responses (subsequent to the filing of the first motion to dissolve) that the organic acid used in its trade secret was sodium benzoate and asserted that GPP failed to articulate a valid trade secret. Le argued business competitors could readily ascertain the components of GPP's "so-called Trade Secret" based on this admission, because the food preservative industry had long known of sodium benzoate. The renewed motion furthermore argued that the trade secret was invalid because it claimed information in the public domain.
In support of the renewed motion, Le submitted another declaration by Berstein. This declaration attached a number of exhibits, including discovery responses by GPP and a copy of patents filed by GPP. Additionally, Le submitted the declaration of Irving S. Rappaport, a registered patent attorney, who offered a number of expert opinions about GPP's trade secret claim.
Rappaport opined that GPP failed to articulate a valid trade secret and there was no basis to continue the injunction. Rappaport discussed sworn statements made by GPP witnesses at their depositions and in court-filed declarations, including testimony by Kierstead, Jabar, and Cyr. Rappaport highlighted certain testimony to support his opinion that the court should not enforce the injunction. For example, Rappaport excerpted portions of Kierstead's deposition testimony and observed that "Kierstead, the CEO who brought the suit, cannot articulate the alleged trade secret and the Injunction is so vague, there is no way for the Court to continue the Injunction."
In 2017, the trial court denied the renewed motion, deciding that Le had failed to meet the requirements of sections 533 and 1008, subdivision (b). In 2017, Le appealed the trial court's order denying his renewed motion.
In 2019, a panel of this court issued its decision in Global I. The court in Global I determined that Le had appealed a nonappealable order-namely the order denying the renewed motion under section 1008, subdivision (b). (Global I, supra, 42 Cal.App.5th at p. 363.) This court nevertheless elected to treat the appeal as a petition for writ of mandate and addressed the merits of Le's arguments, including that GPP did not have a valid trade secret. (Id. at pp. 365-366.) This court rejected Le's claim that GPP did not have a valid trade secret and concluded there was no merit to his claim that the trial court abused its discretion in declining to dissolve the injunction under section 533 and Civil Code section 3426.2. (Global I, at pp. 367-369.)
D. The Present Appeal
Following the issuance of the remittitur in Global I, the trial court set the contempt proceeding for a hearing, calendared for January 19, 2021.
On November 4, 2020, Le filed a motion to dissolve the injunction under section 533 (second motion to dissolve). Le argued GPP did not have a valid trade secret because it could not articulate its trade secret and had disclosed the use of sodium benzoate in certain patents. Le additionally contended that dissolution of the injunction would serve the ends of justice because the trial court lacked "jurisdiction" over the injunction, as the requisites of Civil Code section 3426.2 had not been met and the injunction was too vague and ambiguous on its face to be enforced.
Although styled as a motion to "modify or dissolve" the injunction, Le's motion requested dissolution of the injunction and did not specify any proposed modifications to the injunction.
In further support of the second motion to dissolve, Le submitted a declaration from Berstein filed on November 4, 2020, and a "Supplemental Declaration" by Berstein filed on December 15, 2020 (supplemental Berstein declaration).
The November 2020 declaration attached a number of exhibits related to events in the litigation that preceded the December 2016 renewed motion, including the injunction, GPP's trade secret designations, and excerpts from the depositions of Cyr, Jabar, and Kierstead taken in 2015 and 2016. The supplemental Berstein declaration included as an exhibit the 2016 Rappaport declaration that Le had submitted in connection with its 2016 renewed motion to modify or dissolve the injunction.
GPP opposed Le's second motion to dissolve. GPP argued the motion lacked merit and was barred by the law of the case doctrine. Intervenors VPS also filed an opposition on the same general grounds.
On January 19, 2021, the trial court held a hearing on Le's second motion to dissolve the injunction. After hearing argument by counsel, the trial court adopted its tentative ruling denying Le's motion. The trial court concluded that the law of the case doctrine applied, explaining that it believed the Global I court had been presented with the "same question the court is being presented with now." Additionally, the court found Le had failed to meet the requirements under section 533. The court issued a formal order dated January 25, 2021, denying Le's second motion to dissolve the injunction.
The clerk's transcript does not contain the January 25, 2021 order. On our own motion, we order the record augmented with a copy of this order, which was submitted with the civil case information statement filed in this court. (See Cal. Rules of Court, rule 8.155(a)(1)(A).) On January 27, 2021, the trial court granted Le's ex parte application for an order to stay the proceedings pending Le's appeal. On our own motion, we order the record augmented with a copy of that order, which was submitted with the civil case information statement filed in this court. (See Cal. Rules of Court, rule 8.155(a)(1)(A).)
Le timely appealed the order. (§ 904.1, subd. (a)(6).)
II. DISCUSSION
Le asserts the trial court erred in denying his second motion to dissolve the injunction. Le contends the law of the case doctrine does not apply, and the trial court's finding that Le failed to satisfy the requisites set forth in section 533 lacks substantial evidence. GPP counters that Le's claims are meritless and requests we impose sanctions against Le and his counsel for filing a frivolous appeal.
We decline GPP's invitation to this court to dismiss this appeal without addressing the merits. We address GPP's motion for sanctions requesting fees and costs in part II.B., post.
We first address Le's challenges to the trial court's order.
A. Law of the Case
1. Standard of Review and Legal Principles
We review de novo the applicability of the law of the case doctrine. (Leider v. Lewis (2017) 2 Cal.5th 1121, 1127 (Leider).)
The law of the case doctrine "precludes a party from obtaining appellate review of the same issue more than once in a single action." (Katz v. Los Gatos-Saratoga Joint Union High School Dist. (2004) 117 Cal.App.4th 47, 62.) The doctrine "serves to promote finality of litigation by preventing a party from relitigating questions previously decided by a reviewing court." (George Arakelian Farms, Inc. v. Agricultural Labor Relations Bd. (1989) 49 Cal.3d 1279, 1291.)
The doctrine applies only if the principle or rule of law stated in the prior decision was "necessary" to the decision rendered. (Morohoshi v. Pacific Home (2004) 34 Cal.4th 482, 491 (Morohoshi).)" 'Generally, the doctrine of law of the case does not extend to points of law which might have been but were not presented and determined in the prior appeal. [Citation.] As an exception to the general rule, the doctrine is . . . held applicable to questions not expressly decided but implicitly decided because they were essential to the decision on the prior appeal.'" (Leider, supra, 2 Cal.5th at p. 1127.)
The law of the case doctrine does not apply to determinations of factual questions in a prior appellate opinion but does apply to rulings of law necessary to the decision of the case. (Ajaxo, Inc. v. E*Trade Financial Corp. (2020) 48 Cal.App.5th 129, 180.) The legal sufficiency of evidence is an issue of law. (People v. Shuey (1975) 13 Cal.3d 835, 842, abrogated on another point as recognized in People v. Bennett (1998) 17 Cal.4th 373, 389, fn. 5.) However, the doctrine "binds the trial court as to the law but controls the outcome only if the evidence on retrial or rehearing of an issue is substantially the same as that upon which the appellate ruling was based." (People v. Mattson (1990) 50 Cal.3d 826, 850.) In other words, the introduction of new evidence that is materially or substantially different than that presented in the earlier proceedings renders the doctrine inapplicable. (Estate of Baird (1924) 193 Cal. 225, 244.)
2. Global I
Whether the law of the case doctrine applies to this appeal turns on this court's opinion in Global I. At the outset of the opinion, Global I addressed appellate jurisdiction. This court determined that, although Le had taken an appeal of a nonappealable order, it would treat the appeal as a petition for writ of mandate. This court then addressed the merits of Le's arguments, including whether GPP had a valid trade secret. (Global I, supra, 42 Cal.App.5th at pp. 365-367.)
The Global I court summarized Le's arguments related to trade secret validity: "Appellants argue that the stipulated permanent injunction was based on trade secret law, and, as a result, the injunction must be based on a valid trade secret. Thus, appellants insist that the injunction should have been dissolved because the renewed motion demonstrated that a valid trade secret no longer existed. Appellants argue that under section 533, there was a material change in the facts upon which the stipulated permanent injunction was granted. Appellants claim that appellants' prior disclosures of its unidentified organic acid-such as in the 880 patent cited in their renewed motion- vitiated GPP's commercial advantage because a technical person versed in food preservation practices could easily reverse engineer GPP's trade secret." (Global I, supra, 42 Cal.App.5th at p. 367.)
Addressing this contention, the court in Global I decided that there was sufficient evidence to support the trial court's "implied determination that GPP has a valid trade secret." (Global I, supra, 42 Cal.App.5th at p. 368.) While this court agreed with Le's general proposition that publication of a trade secret destroys it (id. at p. 367), it determined that "the trial court could have reasonably concluded that the publication of the 880 patent and the 147 patent application, combined with the identification of sodium benzoate as the stipulated permanent injunction's previously undisclosed organic acid, did not destroy GPP's trade secret." (Id. at p. 368.) This court noted that the injunction contained language that GPP's trade secret product is" 'a proprietary formula and process for treating field cored iceberg lettuce to increase shelf life of the lettuce.'" (Ibid.) Based on this language, it determined that GPP's trade secret "was not limited to the identity of the components used; the trade secret encompassed the proprietary formula and the process for treating lettuce." (Ibid.)
This court in Global I rejected Le's claim that the injunction was unenforceable because it was too vague. (Global I, supra, 42 Cal.App.5th at p. 369.) It noted that Le had cited to the deposition testimony of various GPP employees, including Cyr, Jabar, and Kierstead and GPP's own trade secret designations, as "recently discovered evidence" that "underscores the vagueness" of the injunction. (Ibid.) This court decided that the trial court could have reasonably concluded the language of the injunction was "sufficiently definite," despite that "contrary evidence." (Id. at p. 370.) It also rejected Le's argument that the injunction was unenforceable and void under Civil Code section 3426.2, reiterating that sufficient evidence supported the trial court's implied determination that GPP had a valid trade secret. (Global I, at p. 371.) Finally, this court concluded that there was no merit to Le's claim that the trial court abused its discretion in declining to dissolve the injunction under section 533 and Civil Code section 3426.2. (Global I, at pp. 371-372.)
3. Analysis
Having independently reviewed the record in the present appeal and the record, briefing, and opinion in Global I, we determine that Global I constitutes the law of the case with respect to Le's second motion to dissolve the injunction. In the second motion to dissolve, Le raised the same issues raised in Global I, including the invalidity of GPP's trade secret. Le presented the same arguments in Global I as he asserted in the second motion to dissolve, and the court in Global I actually decided the issue of the trade secret validity in concluding that substantial evidence supported the trial court's ruling against Le and in favor of GPP.
Critically, and as discussed further below, Le relied on virtually the same evidence in both Global I and in the second motion to dissolve for its contention that GPP did not have a valid trade secret. The evidence related to the second motion consisted of declarations by Le's attorney (Berstein) that attached documents related to the prior discovery and litigation in the case that had occurred a number of years in the past, including the injunction and the 2016 Rappaport declaration that Le had submitted in connection with Le's 2016 renewed motion to modify or dissolve the injunction.
To avoid the application of the law of the case doctrine, Le advances a number of meritless arguments.
First, Le argues that the trial court incorrectly interpreted a footnote in Global I and asserts that this footnote advances his claim that the law of the case doctrine does not apply. The footnote in Global I (hereafter footnote 6) relied upon by Le states: "We also observe that an order denying a motion to dissolve or modify an injunction under section 533 is appealable. (§ 904.1, subd. (a)(6).) We see no reason why [Le] would have been barred from filing a second motion under section 533. Instead, [Le] chose to frame the motion as a renewed motion under section 1008, subdivision (b). Had appellants filed a successive motion under section 533, the trial court's denial of that motion would have been appealable." (Global I, supra, 42 Cal.App.5th at p. 366, fn. 6.)
We do not agree that this language defeats application of the law of the case doctrine. The footnote relates to the section of the opinion that addresses the question of appealability and provides additional context for this court's decision to treat the appeal as a petition for writ of mandate and address the merits of Le's claims. (See Global I, supra, 42 Cal.App.5th at pp. 363-366 [section addressing appealability of the challenged order].) It does not purport to invite (as Le appeared to believe in the trial court and in the present appeal) Le to file a second motion or other successive motions under section 533 that are otherwise precluded by the law of the case doctrine.
Le further contends that Global I is not law of the case because in the second motion to dissolve the trial court had to consider and review "substantially different facts." In his opening brief, Le asserts that this "substantial difference took the form of seven (7) new pieces of evidence" that the trial court had not previously considered. Le lists as "new" evidence GPP's designations of trade secrets and certain deposition testimony provided by GPP witnesses (Cyr, Jabor, and Kierstead).
Le's claim that he presented new evidence in connection with his second motion to dissolve lacks support in the record. In Le's second motion to dissolve, he relied on all the prior evidence he had submitted in connection with both his first motion and renewed motion to dissolve. Moreover, we have independently examined the record and note that all the "new" or "additional" seven pieces of evidence Le has cited are documents or testimony that are dated prior to July 2016 (that is, before the renewed motion filed in December 2016) and contain information that had already been presented to the trial court for its prior consideration and in the Global I appeal.
The seven pieces of evidence listed by Le in Le's opening brief are (1) GPP trade secrets designation dated November 11, 2014; (2) GPP's amended designation of trade secrets dated December 10, 2014; (3) GPP's trade secrets designation dated August 11, 2015; (4) GPP's trade secrets designation dated October 9, 2015; (5) excerpts from the Cyr deposition taken September 17, 2015; (6) excerpts from the Jabor deposition taken May 6, 2016; and (7) excerpts from the Kierstead deposition taken June 16, 2016.
For example, Le's opening brief on appeal cites to the "Deposition of Bob Cyr." Yet, as GPP points out, the substance of the testimony was included in the Rappaport declaration that Le submitted to the trial court in December 2016 and that was part of the record in Global I. As "the gist of the evidence did not change," the law of the case doctrine applies. (Monks v. City of Rancho Palos Verdes (2008) 167 Cal.App.4th 263, 304.)
As the evidence before the trial court on the second motion to dissolve was materially the same as the evidence previously submitted, Le's reliance on Wicktor v. Los Angeles County (1960) 177 Cal.App.2d 390 is misplaced. That case involved a substantial change in the evidence at a second trial (id. at p. 396) and exceptional circumstances involving a beneficiary designation (id. at p. 404) that bear no resemblance to the circumstances here.
Le also claims that Global I resolved contentions related to GPP's process but did not resolve the question of GPP's formula. Le maintains that the court in Global I "chose never to address the issue of a 'formula' and, as such, this issue has never been resolved such that the doctrine of law of the case can be applied to it." We disagree. The Global I court expressly concluded that GPP's trade secret "was not limited to the identity of the components used; the trade secret encompassed the proprietary formula and the process for treating lettuce." (Global I, supra, 42 Cal.App.5th at p. 368, underlining added.)
Le also makes several arguments that are unsupported by any authority and thus fails to meet his burden of demonstrating legal error by the trial court in applying the law of the case doctrine. (See Jameson v. Desta (2018) 5 Cal.5th 594, 608-609.) For example, Le asserts without support that implied findings are not law of the case and that a court may not apply the law of the case doctrine to "prevent the statutory substantive review" of an injunction as required in this case. We decline to consider these unsupported arguments.
Le also points out that application of the doctrine is discretionary and that it should not be applied where its application would result in an injustice. In Morohoshi, the California Supreme Court outlined the application of the "unjust decision" (Morohoshi, supra, 34 Cal.4th at p. 491) exception to the law of the case doctrine: "[W]here there has been a manifest misapplication of existing principles resulting in substantial injustice, or where the controlling rules of law have been altered or clarified by a decision intervening between the first and second appellate determinations. The unjust decision exception does not apply when there is a mere disagreement with the prior appellate determination." (Id. at pp. 491-492.)
Le fails to demonstrate the circumstances here fall under the rubric of the unjust exception. Le does not articulate, let alone demonstrate, any misapplication by the court in Global I of existing principles. Additionally, Le fully litigated the merits of the injunction in Global I. In our view, Le merely disagrees with Global I. Such a disagreement, however, does not trigger the exception. (See Morohoshi, supra, 34 Cal.4th at pp. 491-492.)
For these reasons, we reject Le's claim that the law of the case doctrine does not apply and affirm the trial court's order on that ground.
Given our conclusion that the trial court correctly applied the law of the case doctrine to deny Le's second motion to dissolve, we need not consider GPP's alternative argument that we should affirm the order because Le failed to meet the requirements of section 533. Therefore, we do not reach the question whether substantial evidence supported the trial court's order.
B. GPP's Motion for Sanctions
GPP has filed a motion for sanctions against Le and Le's counsel for taking a frivolous appeal. GPP argues that the appeal is objectively and subjectively frivolous and was taken solely for the purpose of delaying the contempt hearing against Le. GPP observes that Le filed the second motion to dissolve on the eve of the contempt hearing and "recycled" the same arguments from Le's first motion to dissolve filed in 2016.
GPP filed its motion for sanctions after Le filed a reply brief. GPP first filed a motion for sanctions and supporting declarations and exhibits on August 29, 2022. Shortly thereafter, on September 9, 2022, GPP filed an application to file an errata and corrected motion for sanctions, which this court granted. We refer to the corrected motion for sanctions, filed on September 9, 2022, as the motion for sanctions.
GPP points out a number of unreasonable positions and arguments asserted by Le and Le's counsel in the present appeal and maintains they have grossly misrepresented the record and evidence. For example, GPP states that Le misrepresented the record in his opening brief by asserting that GPP never asserted its trade secret was in both a formula and process. GPP argues Le mispresented the testimony in the record by GPP's employees by characterizing the testimony as "never mentioning any process during the entirety of their testimony."
GPP also contends that no reasonable attorney would have brought this appeal. GPP maintains that no reasonable attorney would "[a]ppeal an order denying a motion to dissolve an injunction raising the same issues, and relying on the same evidence, as a motion which is already the subject of a final appellate decision on the merits affirming the order denying the same motion based on substantially the same contentions and evidence." GPP further asserts that Le and Le's counsel have violated fundamental principles of appellate review, including by suggesting the trial court made a finding that is not reflected in the record.
GPP requests we impose sanctions in the amount of $60,391.11 for attorney fees and costs GPP incurred in the present appeal, including the motion for sanctions. GPP also argues we should impose "a second amount" of sanctions payable to this court to "address the cost of this appeal to the judicial system."
Le has filed a brief, including a declaration from Berstein, contending that sanctions are not warranted. At oral argument, Le's attorney Dimuzio argued against the imposition of sanctions. (See Cal. Rules of Court, rule 8.276(c), (d).)
Le's opposition to the motion for sanctions also included a request that we impose sanctions on GPP, payable to the court, for filing its motion for sanctions. Le's request does not comply with the California Rules of Court, and we therefore decline to consider it. (See Cal. Rules of Court, rule 8.276(b)(1); see also FEI Enterprises, Inc. v. Yoon (2011) 194 Cal.App.4th 790, 807.)
1. Legal Principles
Section 907 provides, "When it appears to the reviewing court that the appeal was frivolous or taken solely for delay, it may add to the costs on appeal such damages as may be just." (§ 907.) California Rules of Court, rule 8.276(a) authorizes imposition of sanctions on a party or an attorney for conduct that includes "[t]aking a frivolous appeal or appealing solely to cause delay." (Cal. Rules of Court, rule 8.276(a)(1).)
The California Supreme Court has defined a frivolous appeal in terms of motive and merit. (In re Marriage of Flaherty (1982) 31 Cal.3d 637, 649 (Flaherty).) Both considerations are relevant to determining whether an appeal is frivolous. (Id. at p. 650.) "[A]n appeal should be held to be frivolous only when it is prosecuted for an improper motive-to harass the respondent or delay the effect of an adverse judgment-or when it indisputably has no merit-when any reasonable attorney would agree that the appeal is totally and completely without merit." (Ibid.) Furthermore, to avoid chilling the assertion of a litigant's rights on appeal, the sanctions power "should be used most sparingly to deter only the most egregious conduct." (Id. at pp. 650-651.)
2. Analysis
Having reviewed the record and submissions by the parties (including Le's opposition presented both in writing and at oral argument), we agree with GPP that Le and Le's appellate counsel have transgressed the boundaries of permissible advocacy and engaged in sanctionable conduct in the present appeal.
The motion for sanctions does not name Le's counsel. However, Le's attorneys in this appeal are Berstein and J.R. Dimuzio of the law firm of Berstein Law, PC. Berstein submitted a number of declarations in the trial court, and he and Dimuzio were involved in the Global I appeal. Berstein and Dimuzio are listed as Le's attorneys on the second motion to dissolve filed in the trial court. Dimuzio appeared on behalf of Le at oral argument in this appeal.
We decide that this appeal is frivolous under the Flaherty standard in light of the clear application of the law of the case doctrine. In attempting to avoid application of this well-established doctrine, Le's briefing misrepresents the record by asserting in the opening brief, inter alia, that "prior to this Court's decision in [Global I], no party had contended the Trade Secret Product's protection stemmed from a 'process' and no party had contended the Trade Secret Product consisted of a 'process' that could be distinguished from a 'formula.'" The record makes clear the opposite is true. Indeed, the injunction issued in 2006, which was stipulated to by Le and WCA, states that GPP's trade secret constitutes of a "formula and process." Similarly, Le's opening brief states "the record is devoid of any evidence of any fact supporting protection in a 'process.'" That assertion is likewise unfounded. Sanctions are appropriate because Le's arguments "are not supported by a careful reading of the record or the law nor could these arguments be reasonably characterized as presenting unique issues or arguing for extension, modification, or reversal of existing law." (Kleveland v. Siegel & Wolensky, LLP (2013) 215 Cal.App.4th 534, 557.)
At oral argument and in his postargument declaration, Le's counsel (Dimuzio) cited language in the 2006 injunction but that language neither assists the merits of Le's argument nor demonstrates that this appeal was not frivolous. Le does not appear to dispute (other than in his opening brief, which we have discussed above) that the second motion to dissolve relied on the same evidence as presented in the prior motions and appeal. Accordingly, given the clear application of the law of the case doctrine in this instance, we conclude that any reasonable attorney would agree that the appeal is totally and completely without merit and "would not have raised the arguments defendants make on appeal, which are merely rehashed in the supplemental briefing in opposition to imposition of sanctions." (J.B.B. Investment Partners Ltd. v. Fair (2019) 37 Cal.App.5th 1, 19.) Le and his attorneys appear to believe there continues to be an injustice in maintaining the injunction and that no valid trade secret exists. However, "[e]ven if it can be assumed that appellant conscientiously believes he has been aggrieved, the continued misuse of the courts to relitigate matters previously determined cannot be condoned." (Weber v. Willard (1989) 207 Cal.App.3d 1006, 1010.)
Second, regarding Le's substantial evidence argument based upon section 533, we have declined to address the merits of that argument based on our determination that the law of the case doctrine applies (see fn. 11, ante). Nevertheless, we have reviewed the briefing and record in full and conclude that Le's briefing as to the substantial evidence claim does not comply with basic principles of appellate procedure. "An appellant has a duty to summarize the facts fairly in light of the judgment. [Citation.] 'The duty to adhere to appellate procedural rules grows with the complexity of the record.'" (Ajaxo Inc. v. E*Trade Group Inc. (2005) 135 Cal.App.4th 21, 50.) Le's "slanted presentation of the facts reads more like argument," and Le has failed to provide this court "with a fair and complete summary of the evidence." (Ibid.)
Significantly, Le's substantial evidence argument misrepresents the record and misapplies the standards of appellate review. As to the record, Le's argument centers on an exchange between Le's counsel and the trial court at the hearing at which the trial court ruled against Le. Le's briefing points to the reporter's transcript of that hearing as evidence that the trial court found Le had met his "burden of proof" under section 533 and had "agreed the burden of proof then shifted to GPP." Nothing in the record supports that assertion. Moreover, Le attempts to invite this court to imply the trial court made a certain finding in his favor, whereas we must apply all presumptions in favor of the trial court's order rejecting Le's contentions. (See Jameson v. Desta (2018) 5 Cal.5th 594, 609 [" 'In the absence of a contrary showing in the record, all presumptions in favor of the trial court's action will be made by the appellate court.' "].) No reasonable attorney would advance this argument.
Third, it appears Le and Le's attorneys filed the present appeal to delay the contempt proceedings against Le. The record reflects that they filed the second motion to dissolve the injunction shortly before the contempt hearing on the OSC was scheduled to take place, suggesting that the purpose of the motion was to cause delay and force GPP to expend additional resources. (See Foust v. San Jose Construction Co., Inc. (2011) 198 Cal.App.4th 181, 189.) And by filing the present, meritless appeal and obtaining a stay of the underlying litigation, Le and Le's attorneys further delayed the contempt proceedings in the trial court to the benefit of Le.
Fourth, Le's opposition to GPP's motion for sanctions on appeal (opposition) supports a finding that sanctions are warranted here in order to deter Le and his two attorneys from further abusive litigation tactics and wasting court resources. While Le's attorney Berstein submitted a declaration with the opposition, his declaration merely reiterates the arguments made in Le's briefing. Berstein states that "[i]t remains Appellants' reasonable good faith belief that nothing in this Court's opinion, in [Global I] prevented Appellants from brin[g]ing the Second Motion." However, even assuming that assertion is true, the test is not whether Le or his attorneys thinks the issues are arguable, but instead whether any reasonable attorney would believe that this appeal is totally and completely devoid of merit. (Flaherty, supra, 31 Cal.3d at p. 649.)
Berstein's declaration further relies on footnote 6 of the Global I opinion (the same footnote we have discussed above), asserting that "the wording and context" of footnote 6 "suggested to Appellants that they could file the Second Motion, under Section 533." In our view, no reasonable attorney would have brought a second motion to dissolve relying on this footnote as an invitation to present another motion to the trial court that presented essentially the same question that was previously determined in Global I.
Finally, the arguments made by Le's attorney Dimuzio at oral argument in this appeal reinforce our decision to impose monetary sanctions in this instance. Among other statements, Dimuzio represented to this court that the trial court had "said" in "the first instance" that there was "an injustice" and "no valid trade secret" and that Le had established a "prima facie" case. No such statement or finding by the trial court appears in the record. To the contrary, the trial court found that Le had failed to meet the requirements for dissolving or modifying an injunction under section 533. Even after GPP's counsel pointed out this fact at oral argument, Dimuzio did not acknowledge his misrepresentation of the record. "An attorney is an officer of the court and owes the court a duty of candor. [Citation.] The duty of candor requires attorneys to use 'those means only as are consistent with truth, and never to seek to mislead the judge or any judicial officer by an artifice or false statement of fact or law.' (Bus. &Prof. Code, § 6068, subd. (d).)" (Roche v. Hyde (2020) 51 Cal.App.5th 757, 817.) This violation of the duty of candor is additional strong evidence of an improper intent to cause delay by abusing the appellate process and thus reinforces our conclusion that sanctions must be imposed in this case.
Dimuzio's declaration submitted after oral argument does not address this statement about the trial court's findings or the hearing denying the second motion to dissolve. Rather, his declaration corrected a record citation he made at the request of this court, which pertains to the first page of the 2006 injunction. Additionally, Berstein submitted a document characterized as "Appellants' supplemental letter brief to correct citation to record" that attached Dimuzio's postargument declaration.
For all of these reasons, we conclude sanctions are warranted in this case.
We turn to the nature and amount of sanctions. "Sanctions may be awarded against both an appellant and its counsel. [Citation.] Sanctions are appropriate when appellant's counsel had a professional obligation not to pursue the appeal or should have declined the case outright. [Citation.] Sanctions against the party are appropriate when the record indicates the party benefitted from the delay or was otherwise involved in the bad faith conduct. [Citation.] The amount of sanctions is determined by looking to respondent's attorney fees on appeal, the judgment against the appellant, the degree of objective frivolousness and delay, and the need to discourage similar conduct in the future. [Citation.] Additionally, we may impose sanctions to compensate the court for the costs associated with processing, reviewing and considering the appeal." (Malek Media Group LLC v. AXQG Corp. (2020) 58 Cal.App.5th 817, 837.) Applying these principles and based on the circumstances in this case, we decide sanctions are appropriate against both Le and Le's attorneys Berstein and Dimuzio who have been involved in this appeal and the protracted prior litigation.
GPP has submitted declarations showing that its reasonable appellate attorney fees and costs total $60,391.11. The opposition to sanctions does not address the amount or reasonableness of that figure. We decide that the amount of monetary sanctions requested by GPP is a reasonable and appropriate sanction. Moreover, reducing the sanctions to a nominal sum would defeat the purpose of discouraging Le, his attorneys, and others from engaging in like conduct in the future.
This amount does not include additional attorney fees incurred by GPP for reviewing Le's opposition to sanctions and for preparing for and participating in oral argument, which GPP's attorney declaration stated GPP would incur if Le opposed the motion for sanctions and requested oral argument. As we have no evidence supporting those additional fees, we do not award them.
At oral argument, this court questioned Dimuzio on the amount of the fees sought by GPP in its motion for sanctions. Dimuzio did not provide any argument directed to the amount of monetary sanctions, including the reasonableness of the attorney fees, other than to argue that no sanctions should be imposed.
Additionally, the cost of processing an appeal that results in an opinion has been estimated to be approximately $8,500. (See Clarity Co. Consulting, LLC v. Gabriel (2022) 77 Cal.App.5th 454, 467 [awarding same]; but see Bucur v. Ahmad (2016) 244 Cal.App.4th 175, 195 (Bucur) [imposing award of $25,000 payable to the clerk in addition to approximately $30,000 payable to the respondent].) Accordingly, we conclude a sanction of $8,500 to the clerk of this court is also appropriate.
This opinion shall constitute a written statement of our reasons for imposing these sanctions. (Bach v. County of Butte (1989) 215 Cal.App.3d 294, 313.) In compliance with the requirements of Business and Professions Code section 6086.7, a copy of this opinion shall be forwarded to the State Bar. (See Bucur, supra, 244 Cal.App.4th at p. 195.)
III. DISPOSITION
The January 2021 order denying Le's motion to modify or dissolve the permanent injunction is affirmed. Respondent's motion for sanctions is granted. Sanctions are imposed against Kevin Le, West Coast AG, LLC, and attorneys David A. Berstein (SBN 204472) and John Dimuzio, Jr. (SBN 299803), jointly and severally, in the amount of $60,391.11, payable to respondent GPP, and $8,500, payable to the clerk of this court no later than 30 days after the remittitur issues. The clerk of this court is directed to deposit said sum in the general fund. Additionally, the clerk of this court is ordered to send a copy of this opinion to the State Bar of California upon issuance of the remittitur. (Bus. &Prof. Code, §§ 6068, subd. (o)(3), 6086.7, subd. (a)(3); Bucur, supra, 244 Cal.App.4th at p. 195.)
WE CONCUR: Greenwood, P.J., Wilson, J.