Opinion
NOT TO BE PUBLISHED
APPEALS from a judgment of the Superior Court of San Diego County, No. GIC819192 J. Luis Vargas, Judge.
O'ROURKE, J.
Defendant Gary Ravet appeals from a judgment in favor of plaintiffs Personalized Workout of La Jolla, Inc. (PWL) and Nathan Poole on plaintiffs' malicious prosecution action arising from Ravet's underlying lawsuit involving a dispute over health club membership fees. The jury in the malicious prosecution action returned a special verdict awarding PWL and Poole $74,047.59 in compensatory damages and, later, $5 million in punitive damages on a finding that Ravet acted with malice, fraud or oppression. On Ravet's motion for judgment notwithstanding the verdict (JNOV), the trial court reduced the punitive damages award to $296,190.36.
On appeal, Ravet contends (1) his voluntary dismissal of the underlying lawsuit as well as PWL's lack of standing prevents a finding of favorable termination for purposes of a malicious prosecution action and (2) plaintiffs did not meet their burden to present evidence of his positive net worth or ability to pay a punitive damages award. He contends that if this court reinstates the first judgment including the $5 million punitive damages award, we should order a new trial as to the award on grounds it is excessive as a matter of law.
Plaintiffs appeal from the judgment on grounds the trial court had no power to reduce the punitive damage award by way of a JNOV order; that it was required to grant a new trial on a conditional remittitur. They ask us to hold that the trial court's JNOV order is void and modify the judgment to reinstate the $5 million punitive damages award as not unconstitutionally excessive.
We reject all of these contentions and affirm the judgment.
FACTUAL AND PROCEDURAL BACKGROUND
Underlying Action
In late 2001, Ravet, then a licensed attorney acting in pro per and also representing his then-girlfriend Meryl Zinn, sued his health club (erroneously sued as "Personalized Workout, Inc."), its manager Nathan Poole, and Club One, Inc. (Club One) over a dispute about his and Zinn's health club membership renewal fees. Ravet and Zinn alleged causes of action for breach of contract, breach of the covenant of good faith and fair dealing, fraud and negligent misrepresentation, and also sought to enjoin PWL from transferring its assets to Club One pending the dispute. Ravet eventually settled the matter with Club One.
In June 2002, Poole and PWL moved for judgment on the pleadings with respect to Ravet's cause of action for breach of the covenant of good faith and fair dealing, on grounds such a cause of action no longer existed. Ravet responded with a statement of nonopposition and request to strike the cause of action from the complaint. Thereafter, Poole and PWL moved to declare Ravet a vexatious litigant. On July 1, 2002, Poole and PWL also applied ex parte for leave to file a cross-complaint against Ravet, Zinn and Club One for indemnification based on Club One's claim for reimbursement of attorney fees and monies paid to Ravet.
The next day, Ravet dismissed the action without prejudice, advising counsel for Poole and PWL that investigation had revealed his clients were "uncollectable and/or residing outside of the State of California."
Poole and PWL thereafter filed a cost memorandum and moved for recovery of approximately $11,800 in attorney fees under Code of Civil Procedure section 128.5. They argued Ravet had submitted false pleadings and committed perjury in his deposition about his communications with Poole in connection with the underlying dispute. Following an August 23, 2002 hearing on that motion, the court set aside Ravet's July 2, 2002 dismissal and entered judgment in Poole and PWL's favor, awarding them $867 in costs.
Neither party cites to a transcript of the August 2002 hearing, and there appears to be none in the record. The judgment states: "This court, having on August 23, 2002[,] granted the motion for costs by [Poole and PWL] and having ordered entry of judgment as requested in said motion. [¶] It is ordered, adjudged and decreed that [¶] Plaintiffs Meryl Zinn and Gary Ravet shall take nothing, and that Defendants [Poole and PWL] shall recover from said Plaintiffs costs of suit in the sum of $867. Dismissal dated 7-2-02 is set aside." The last sentence of the judgment is handwritten.
Malicious Prosecution Action
In October 2003, PWL (named in the complaint as "Personalized Workout") and Poole sued Ravet (and Zinn, who was later dismissed) for malicious prosecution. They alleged Ravet lacked reasonable or probable cause to pursue the underlying lawsuit and no reasonable attorney would have pursued the claims, which were either false or not legally cognizable.
During the course of the proceedings and at the start of trial, Ravet unsuccessfully sought to dismiss the complaint on various grounds, including that PWL did not exist as a duly organized corporation or was a suspended corporate entity, and that it lacked standing to maintain the malicious prosecution action. Thereafter, the trial court granted PWL and Poole leave to amend both the malicious prosecution complaint and the underlying judgment to reflect the correct entity name, Personalized Workout of La Jolla, Inc.
The matter proceeded to a jury trial, after which the jury returned a special verdict finding Ravet was actively involved in bringing a lawsuit against plaintiffs; that no reasonable person in his circumstances would have believed plaintiffs agreed to provide both him and Zinn a one-year membership for the total cost of $599; that Ravet acted primarily for a purpose other than succeeding on the merits of the claim; and that Ravet's conduct was a substantial factor in causing harm to the plaintiffs. The jury awarded PWL $24,047.59 and Poole $50,000 in compensatory damages. It further found as to both plaintiffs Ravet engaged in his conduct with malice, oppression or fraud. Following a bifurcated punitive damages phase, the jury awarded PWL $3.5 million and Poole $1.5 million in punitive damages.
Ravet moved for a new trial and for JNOV, in part arguing the court should grant JNOV on grounds the punitive damages award was unconstitutionally excessive; he asked that the court grant a new trial or condition its denial of the motion on plaintiffs accepting a remittitur of damages. The court denied Ravet's new trial motion but granted JNOV in part finding the punitive damages award excessive as a matter of law. It reduced the award to $96,190.36 for PWL and $200,000 for Poole so as to reflect a 1 to 4 ratio. Thereafter, the court denied plaintiffs' motion for reconsideration seeking reinstatement of the punitive damages award, and entered judgment accordingly.
DISCUSSION
I. Favorable Termination
Ravet contends he was entitled to summary judgment or dismissal of plaintiffs' malicious prosecution action because as a matter of law plaintiffs cannot show a favorable termination of the underlying action. He rests this contention on two points. First, Ravet argues that after he voluntary dismissed the underlying lawsuit, the trial court lacked subject matter jurisdiction to enter any further orders in the action, including its orders vacating the dismissal and entering judgment in favor of PWL and Poole. Second, he argues his voluntary dismissal cannot fulfill the favorable termination element of a malicious prosecution claim, because it did not reflect on the merits of the action. Ravet further contends the trial court erred as a matter of law by amending the judgment nunc pro tunc to reflect Personalized Workout of La Jolla, Inc. as the correct corporate entity plaintiff so as to allow the malicious prosecution action to go forward.
In response, plaintiffs argue Ravet misrepresents the procedural facts that show the underlying lawsuit concluded with a judgment in their favor. They maintain that because he did not appeal from the trial court's order vacating his voluntary dismissal, Ravet is now foreclosed from challenging that judgment and what remains is a favorable termination for purposes of malicious prosecution: a judgment in plaintiffs' favor in the underlying lawsuit coupled with an award of costs on their behalf as prevailing parties. Plaintiffs further argue that even if this court could review the order vacating Ravet's dismissal, the trial court's action was a proper exercise of its jurisdiction under the circumstances, which indicate Ravet only strategically dismissed his case when he realized plaintiffs would not capitulate to his demands. Finally, plaintiffs argue the trial court could exercise its inherent power to correct a clerical error in the underlying judgment and their malicious prosecution complaint.
We reject plaintiffs' argument that the judgment in their favor "[u]ndoubtedly... constitutes a favorable termination on PWL's behalf, especially where it was coupled with an award of costs on PWL's behalf as the 'prevailing party.' " Plaintiffs do not establish the favorable termination element of malicious prosecution by merely pointing to a judgment in their favor; it is settled that a favorable termination does not occur merely because a defendant has prevailed in the underlying action. (Lackner v. LaCroix (1979) 25 Cal.3d 747, 751; Casa Herrera, Inc. v. Beydoun (2004) 32 Cal.4th 336, 342 (Casa Herrera).) They would be required to establish that the favorable judgment was on the merits, assessed by a reviewing court by considering the " ' "judgment as a whole in the prior action...." ' " (Seibel v. Mittlesteadt (2007) 41 Cal.4th 735, 741, 743 [judgment following jury trial was on the merits, even where during a pendency of appeals parties reached a settlement that did not amend the judgment on the merits as it related to one plaintiff].)
A. Effect of Ravet's Voluntary Dismissal
Ravet is correct that his voluntary dismissal of the underlying action, which occurred during the pendency of motions brought by PWL and Poole but well before the commencement of any trial, deprived the trial court in the underlying action of both subject matter and personal jurisdiction. Under the circumstances, the court was without jurisdiction to act further except for the limited purpose of awarding costs and statutory attorney fees. (Code Civ. Proc., § 581, subd. (b)(1); Wackeen v. Malis (2002) 97 Cal.App.4th 429, 437; Harris v. Billings (1993) 16 Cal.App.4th 1396, 1405; Casa De Valley View Owner's Assn. v. Stevenson (1985) 167 Cal.App.3d 1182, 1191-1192.) " '[I]t is a well settled proposition of law that where the plaintiff has filed a voluntary dismissal of an action..., the court is without jurisdiction to act further [citations], and any subsequent orders of the court are simply void.' " (Paniagua v. Orange County Fire Authority (2007) 149 Cal.App.4th 83, 89, quoting Gherman v. Colburn (1971) 18 Cal.App.3d 1046, 1050.) Thus, in the underlying case, the trial court lacked jurisdiction to vacate the dismissal without prejudice and enter judgment in PWL and Poole's favor. (Harris v. Billings, at p. 1405.)
Because the court's order entering judgment (and the underlying judgment) is void, Ravet can raise this fundamental jurisdictional defect on appeal from the judgment in the subsequent malicious prosecution action. Recognizing this defect, however, does not prevent us from deciding whether Ravet's July 2002 voluntary dismissal of the underlying action met malicious prosecution standards in that it " 'reflect[s] the merits of the action and the [malicious prosecution] plaintiff's innocence of the misconduct alleged in the lawsuit.' " (Casa Herrera, supra, 32 Cal.4th at pp. 341-342; see also StaffPro, Inc. v. Elite Show Services, Inc. (2006) 136 Cal.App.4th 1392, 1399-1400; Hudis v. Crawford (2005) 125 Cal.App.4th 1586, 1590.) We turn to that question.
"Void" orders are vulnerable to direct or collateral attack at any time, by any judge. (See Code Civ. Proc., § 473, subd. (d) [authorizing a court "on motion of either party after notice to the other party" to "set aside any void judgment or order"]; People v. American Contractors Indemnity Co. (2004) 33 Cal.4th 653, 660-661 [void orders are subject to collateral attack at any time]; People v. Amwest Sur. Ins. Co. (2004) 125 Cal.App.4th 547, 552; People v. West Coast Shows, Inc. (1970) 10 Cal.App.3d 462, 467 [explaining that a void judgment may be set aside "by a judge other than the one who made it"]; Ross v. Murphy (1952) 113 Cal.App.2d 453, 455 [holding that the court has statutory authority under Code of Civil Procedure section 473 as well as inherent authority to set aside a void judgment or order of another judge].)
B. Ravet Has Not Demonstrated That the Trial Court Erred in Directing a Verdict on the Question of Whether The Underlying Lawsuit Terminated in Plaintiffs' Favor
" ' "The theory underlying the requirement of favorable termination is that it tends to indicate the innocence of the accused, and coupled with the other elements of lack of probable cause and malice, establishes the tort [of malicious prosecution]".... [¶] To determine "whether there was a favorable termination," we "look at the judgment as a whole in the prior action...".... "It is not essential to maintenance of an action for malicious prosecution that the prior proceeding was favorably terminated following trial on the merits."... Rather, "[i]n order for the termination of a lawsuit to be considered favorable to the malicious prosecution plaintiff, the termination must reflect the merits of the action and the plaintiff's innocence of the misconduct alleged in the lawsuit." ' " (Hudis v. Crawford, supra, 125 Cal.App.4th at p. 1590, quoting Casa Herrera, supra,32 Cal.4th at pp. 341-342.)
" 'However, a " 'favorable' termination does not occur merely because a party complained against has prevailed in an underlying action.... If the termination does not relate to the merits — reflecting on neither innocence of nor responsibility for the alleged misconduct — the termination is not favorable in the sense it would support a subsequent action for malicious prosecution."... Thus, a "technical or procedural [termination] as distinguished from a substantive termination" is not favorable for purposes of a malicious prosecution claim.... Examples include dismissals (1) on statute of limitations grounds...; (2) pursuant to a settlement...; or (3) on the grounds of laches....' " (Hudis v. Crawford, supra, 125 Cal.App.4th at pp. 1590-1591, quoting Casa Herrera, supra, 32 Cal.4th at p. 342.)
Where the underlying action is terminated in some manner other than by a judgment on the merits, a court will examine the record to see if the disposition reflects the opinion of the court or the prosecuting party that the action would not succeed. (Sycamore Ridge Apartments, LLC v. Naumann (2007) 157 Cal.App.4th 1385, 1399 (Sycamore Ridge).) If conflicts arise about the circumstances of the termination, determination of the reasons underlying the dismissal is a question of fact. (Ibid., citing Ross v. Kish (2006) 145 Cal.App.4th 188, 198; see also Fuentes v. Berry(1995) 38 Cal.App.4th 1800, 1808 [if a conflict arises as to the circumstances explaining a failure to further prosecute an action, the determination of the reasons underlying the dismissal is a question of fact]; Haight v. Handweiler (1988) 199 Cal.App.3d 85, 89.)
Applying these principles, Ravet argues his voluntary dismissal of the underlying complaint was not due to the plaintiffs' innocence; that he "simply discovered that the correct entity was [Personalized Workout] of La Jolla, Inc. and not [Personalized Workout] Inc. as listed in his complaint." As support for that proposition, Ravet cites a portion of the transcript in the malicious prosecution action where he argued in support of his motion to dismiss the malicious prosecution complaint that his reason for dismissing the underlying action was that he was lead to believe the entity he was suing did not exist. But an argument of counsel is not evidence, and Ravet's statements to the court were not made under penalty of perjury. (See Davenport v. Blue Cross of California (1997) 52 Cal.App.4th 435, 454.) He also points to his declaration in opposition to plaintiffs' motion to amend the pleadings in the malicious prosecution action, in which he averred that he dismissed the underlying action as a result of a "due diligence investigation." According to Ravet, he had learned that the entity Personalized Workout, Inc. "did not exist and was merely a shell cover for the operations of the Club," its assets had been sold to Club One and proceeds distributed to the owners, the owners resided outside California, and Poole was unemployed.
Ravet's argument is flawed in several respects. He ignores Sycamore Ridge, supra, 157 Cal.App.4th 1385, in which this court recognized an important presumption in plaintiffs' favor. There, we stated: "A voluntary dismissal is presumed to be a favorable termination on the merits, unless otherwise proved to a jury. [Citation.] This is because ' "[a] dismissal for failure to prosecute... does reflect on the merits of the action [and in favor of the defendant].... The reflection arises from the natural assumption that one does not simply abandon a meritorious action once instituted." ' " (Id. at p. 1400, citing Lackner v. LaCroix, supra, 25 Cal.3d at pp. 750-751 & Weaver v. Superior Court (1979) 95 Cal.App.3d 166, 185, disapproved on other grounds in Sheldon Appel Co. v. Albert & Oliker (1989) 47 Cal.3d 863, 882.)
Further, Ravet fails to acknowledge that the parties litigated the issue of whether the underlying action terminated favorably to plaintiffs, resulting in the trial court determining that question as a matter of law after the close of evidence and so instructing the jury. The trial court effectively granted a partial directed verdict in plaintiffs' favor on the question (see Valentine v. Baxter Healthcare Corp. (1999) 68 Cal.App.4th 1467, 1476; Code Civ. Proc., § 630, subds. (a), (b)), and we infer in support of its ruling that it determined "there was no evidence of sufficient substantiality to support [Ravet's claim]" that the underlying action did not terminate in plaintiffs' favor. (Wolf v. Walt Disney Pictures & Television (2008) 162 Cal.App.4th 1107, 1119, quoting Newing v. Cheatham (1975) 15 Cal.3d 351, 358-359; Jonkey v. Carignan Const. Co. (2006) 139 Cal.App.4th 20, 25 [reviewing court must draw all inferences in favor of the judgment, ruling, order or verdict].) An appellate court would review such an order by looking at the evidence in the light most favorable to Ravet, resolving all conflicts and drawing all inferences in his favor and disregarding conflicting evidence. (Wolf, 162 Cal.App.4th at p. 1119.) We would reverse the judgment if substantial evidence, not merely a scintilla of evidence, exists that would tend to prove that element of Ravet's case. (Id. at pp. 1119-1120.)
Ravet had pointed out in his opening statement that plaintiffs had the burden to prove the element of favorable termination; plaintiffs' counsel likewise acknowledged that burden in his opening statement. However, during the jury instruction conference, plaintiffs' counsel argued that based on both the circumstances of Ravet's voluntary dismissal and the ensuing judgment, a reasonable juror could only conclude that the action terminated in plaintiffs' favor. Plaintiffs' counsel confirmed and Ravet's substitute counsel (who had specially appeared for Ravet while he was out of town) acknowledged the order: "As I understand the Court's directive, it is you are making a determination as a matter of law that the underlying action terminated in favor of the plaintiffs and asking the plaintiffs to create a modified instruction which takes into account BAJI [No.] 7.32. [¶] The Court: Yes. [¶] [Defense counsel]: Okay." The issue was revisited when Ravet returned; he objected to the trial court's decision to eliminate the element of favorable termination to the jury and the court declined to reconsider its decision. The court then instructed the jury: "The prior proceedings terminated in favor of the plaintiff Nathan Poole and the plaintiff Personalized Workout of La Jolla, Inc."
Ravet does not address that question; he does not attack the trial court's action (either procedurally or substantively) nor does he point to any of the trial evidence reflecting the reasons why he dismissed the underlying law suit. We conclude these omissions result in a forfeiture of the point on appeal. " 'The appellate court is not required to search the record on its own seeking error.' " (Nwosu v. Uba (2004) 122 Cal.App.4th 1229, 1246.) Because Ravet does not offer a fair statement of the trial evidence supporting his position on the issue of favorable termination, he has forfeited his challenge to the sufficiency of the evidence. (See, e.g., Ajaxo Inc. v. E*Trade Group, Inc. (2005) 135 Cal.App.4th 21, 50; Road Sprinkler Fitters Local Union No. 669 v. G & G Fire Sprinklers, Inc. (2002) 102 Cal.App.4th 765, 783.)
C. Amendment of Malicious Prosecution Complaint to Name Personalized Workout of La Jolla, Inc. as Corporate Plaintiff
Ravet contends PWL had no standing to prosecute the malicious prosecution action because it was not a party to the underlying action, in which it was sued as "Personalized Workout, Inc.," and the trial court erred by amending the underlying judgment nunc pro tunc to identify PWL as the correct corporate entity plaintiff.
We need not address the point. We have already concluded (part I(B) ante) that the trial court's entry of judgment in the underlying action was void and of no effect. The sole remaining question is whether the trial court properly granted plaintiffs leave to amend their complaint in the malicious prosecution action to reflect the correct entity name. But again, Ravet does not meaningfully challenge that aspect of the trial court's order; he does not cite persuasive authority or argument demonstrating that its decision to permit the amendment was an abuse of discretion. (Huff v. Wilkins (2006) 138 Cal.App.4th 732, 746 [appellate court reviews a trial court's decision to allow filing of an amended complaint for abuse of discretion].) We apply settled appellate review principles in which we presume the correctness of the trial court's ruling unless the appellant demonstrates error. (See Winograd v. American Broadcasting Co. (1998) 68 Cal.App.4th 624, 631-632 and cases cited therein.) Doing so, we are presented with no basis to overturn the trial court's order.
Code of Civil Procedure section 473, subdivision (a)(1) governs amendment of pleadings. That section provides: "The court may, in furtherance of justice, and on any terms as may be proper, allow a party to amend any pleading or proceeding by adding or striking out the name of any party, or by correcting a mistake in the name of a party, or a mistake in any other respect; and may, upon like terms, enlarge the time for answer or demurrer. The court may likewise, in its discretion, after notice to the adverse party, allow, upon any terms as may be just, an amendment to any pleading or proceeding in other particulars; and may upon like terms allow an answer to be made after the time limited by this code."
II. Denial of New Trial on Punitive Damages
Ravet challenges the trial court's denial of his new trial motion on grounds the jury's punitive damage award is not based on any evidence of his net worth, and thus it is both excessive and presumptively the result of passion and prejudice. He maintains plaintiffs presented only evidence revealing that he had a negative net worth; that otherwise, they relied upon innuendo. Ravet argues plaintiffs were not excused from presenting evidence of his financial condition on the theory that he had failed to comply with court orders to produce such information, because he did not neglect any court orders but instead timely produced all of plaintiffs' requested financial information when finally ordered by the trial court on the day the jury returned its compensatory damages verdict. He maintains that what he finally produced was responsive, "truthful and accurate and there is no evidence by Plaintiffs to show otherwise."
A. Standard of Review
"[A] trial judge is accorded a wide discretion in ruling on a motion for new trial and... the exercise of this discretion is given great deference on appeal. [Citations.] However,... on an appeal from the judgment it is our duty to review all rulings and proceedings involving the merits or affecting the judgment as substantially affecting the rights of a party [citation], including an order denying a new trial. In our review of such order denying a new trial, as distinguished from an order granting a new trial, we must fulfill our obligation of reviewing the entire record, including the evidence, so as to make an independent determination as to whether the error was prejudicial." (City of Los Angeles v. Decker (1977) 18 Cal.3d 860, 871-872.) As to prejudice, " '[T]he trial court is bound by the rule of California Constitution, article VI, section 13, that prejudicial error is the basis for a new trial, and there is no discretion to grant a new trial for harmless error.' " (Sherman v. Kinetic Concepts, Inc. (1998) 67 Cal.App.4th 1152, 1160-1161.) "When the court has denied a motion for a new trial... we must determine whether the court abused its discretion by examining the entire record and making an independent assessment of whether there were grounds for granting the motion." (ABF Capital Corp. v. Berglass (2005) 130 Cal.App.4th 825, 832.)
B. Procedural Background
To address Ravet's arguments, we recount the background of the proceedings leading up to the punitive damages phase of trial, beginning with plaintiffs' request that Ravet produce financial information. On April 14, 2006, plaintiffs mailed to Ravet a Code of Civil Procedure section 1987 "Notice in Lieu of Subpoena" (the 1987 notice), requesting that he appear at trial on May 8, 2006, and bring documents specified on an attached exhibit. The exhibit identified categories of documents including "Financial statements," "Income and expense statements," "Balance sheets," "General ledgers,"
Code of Civil Procedure section 1987 provides in part: "(b) In the case of the production of a party to the record of any civil action or proceeding or of a person for whose immediate benefit an action or proceeding is prosecuted or defended or of anyone who is an officer, director, or managing agent of any such party or person, the service of a subpoena upon any such witness is not required if written notice requesting the witness to attend before a court, or at a trial of an issue therein, with the time and place thereof, is served upon the attorney of that party or person. The notice shall be served at least 10 days before the time required for attendance unless the court prescribes a shorter time. If entitled thereto, the witness, upon demand, shall be paid witness fees and mileage before being required to testify. The giving of the notice shall have the same effect as service of a subpoena on the witness, and the parties shall have those rights and the court may make those orders, including the imposition of sanctions, as in the case of a subpoena for attendance before the court.
"Passbooks and monthly statements for savings accounts," and "Passbooks and monthly statements for checking accounts."
This general categorization does not comply with the requirements of Code of Civil Procedure section 1987 (see footnote 6, ante), which requires the notice to state "the exact materials or things desired and that the party or person of whom the request is made has them in his or her possession or under his or her control." (Code Civ. Proc., § 1987, subd. (c), italics added; see Wegner et al., Cal. Practice Guide: Civil Trials and Evidence (The Rutter Group 2009) ¶¶ 1:115-1:115.1, p. 1-29 ["For discovery purposes, a party may compel document production by reasonably describing a category of documents.... [¶] But to obtain production at trial, the description must be 'exact' (e.g., 'letter dated June 21, 1990, written by Harry A. Jones to Paula Smith, captioned "Re XYZ" and marked as Exhibit "A" in Smith's deposition'). [¶]... This prevents parties from using a 'notice to produce' for discovery purposes after discovery is closed"].)
Ravet did not file written objections to the 1987 notice within five days after its service upon him. (Code Civ. Proc., § 1987 subd. (c), see footnote 6, ante.) Rather, on or about May 8, 2006, Ravet moved to quash the 1987 notice under the authority of Code of Civil Procedure section 1987.1, on grounds plaintiffs' request was overly broad, unduly burdensome and sought privileged materials. Characterizing the 1987 notice as a subpoena, he argued it should be quashed because its requests were uncertain, not defined by dates or periods of time, overbroad and vague, compound, and sought confidential information that was privileged and constitutionally protected.
In June 2006, the matter came before superior court judge Luis Vargas for a trial readiness conference. Judge Vargas, who had not yet examined the court file, ordered Ravet to provide financial condition documentation under seal to the court if there were a prior court order that he do so. On July 14, 2006, the parties appeared again to resolve issues before the upcoming trial. The court addressed plaintiffs' request and Ravet's motion to quash, again asking Ravet to produce the requested documents under seal on the first day of trial: "... I would ask that you reread carefully what is requested of you, produce that under seal, and bring that on the first day of trial. The problem with the completeness or if there is — if there are incomplete records, then I'm going to be concerned that we're going to have a problem, and the problem is of course that the parties will be prejudiced in terms of examining on issues of financial ward [sic], and we'll share with you, if that's the case, it would be to your detriment. [¶] I would ask you to produce your documents under seal, and I hope that you are assured of their confidential nature until such time this court makes a ruling that they're indeed relevant to this proceeding. If we don't get to phase 2 of the trial, they'll be handed back to you in the sealed form, never to be seen even by this court."
On Wednesday, March 28, 2007, a jury instruction conference took place at which counsel specially appeared in Ravet's place. At that hearing, the trial court granted and denied in part Ravet's motion to quash, ordering Ravet to produce under seal for its review the following Monday (April 2, 2007) certain categories of documents listed on plaintiffs' notice, as well as a balance sheet reflecting total assets and total debts, which was to be made immediately available to the parties. The next day, Ravet acknowledged he had discussed the court's ruling with the attorney who appeared on his behalf.
The court ordered that Ravet produce under seal all of his financial statements; income and expense statements; balance sheets; general ledgers; grant deeds; W-2 forms; 1099 and payroll stubs; passbooks and monthly statements for savings accounts; checkbook and monthly statements for checking accounts; contracts, agreements, statements for savings, profit sharing, stock options, stock purchases, deferred comps; documents including registration and pink slip for vehicles in Ravet's name; stocks, bonds, certificates or types of security; all documents received from property; all documents, annuities, retirements or pension plans; assignments for the benefit of creditors; loan applications made during the past 10 years; car lease applications made in his name during the last five years; all documents regarding any interest Ravet had in real property; and all documents regarding trust funds in which Ravet was a beneficiary.
On April 2, 2007, plaintiffs' counsel pointed out Ravet had not produced any financial documents. Ravet advised the court he had not had time to comply with the order. The court reminded counsel of that day's deadline, and Ravet stated, "I will honor your deadline today, your honor." Later that day, the jury returned its liability verdict in plaintiffs' favor. Thereafter, counsel discussed the court's order and plaintiffs' counsel asked Ravet to produce the court-ordered summary balance sheet, even in handwritten form. Ravet told the court he would deliver or fax the court ordered documents by the next morning. Over plaintiffs' objections, the court ordered Ravet to produce everything in the courtroom at 8:00 a.m. the following morning.
The next day, Ravet produced two documents: a March 15, 2007 checking account statement indicating a balance of $2,464.28 and a document entitled "Statement of Total Assets and Debts, Gary Keith Ravet, As of April 2, 2007." That document listed "Total Assets (estimated)" at "approximately $50,000" and "Total Debts (estimated)" at "approximately $1,000,000." Ravet also filed a response to the notice, objecting on prior grounds and stating he had no documents other than those he had produced. Plainly frustrated with Ravet's maneuverings, the court stated it was not satisfied with Ravet's production and could issue a discovery sanction in the form of a jury instruction advising the jury about the order and what Ravet produced, so as to permit the jury to judge his credibility in view of his trial testimony. The court did so, instructing the jury in part that "[t]he Court ordered the defendant to produce documents in lieu of subpoena, those are the documents A through FF contained in Exhibit 201. The defendant this morning responded with the responses contained in Exhibit 201. The jury is to consider these responses and the fact that the responses were received today on the issue of the defendant's credibility."
Plaintiffs' counsel proceeded to argue to the jury that Ravet had developed a specialty in offshore tax shelters to minimize his income, and that he "obviously" had a "very very substantial net worth" as evidenced by his own trial testimony of his success and means. Later that day, the jury returned a punitive damages verdict in plaintiffs' favor, awarding PWL $3.5 million and Poole $1.5 million in punitive damages.
C. Analysis
Our analysis begins and ends with Ravet's argument that he did not violate any court order to produce his financial evidence. He purports to recite the procedural background of plaintiffs' efforts to obtain his financial information so as to establish that at no time before April 2, 2007, did the trial court order him to produce his financial records. However, in doing so, Ravet ignores a critical point in the proceedings that occurred on March 28, 2007, while counsel specially appeared on his behalf. As we have set out in detail above, on that day, the trial court unambiguously ruled on Ravet's motion to quash and ordered Ravet to produce under seal specific categories of documents identified on plaintiffs' 1987 notice, as well as the summary balance sheet that was to be "immediately" provided to plaintiffs. Ravet did not immediately produce the balance sheet, and in fact the following Monday he neglected to produce anything to the court for in camera review as it had expressly ordered. It was not until April 3, 2007, the very day plaintiffs were scheduled to put on their punitive damages case, that Ravet finally produced his one-sheet description of assets and liabilities and checking account statement. We will not disregard the trial court's March 28, 2009 order to produce merely because it thereafter elected to continue to press Ravet to finally produce the requested financial records rather than commence contempt proceedings or otherwise sanction him.
Ravet argues that because there was no "extant" court order to produce his documents until April 2, 2007, he was not in violation of any court order. He thus maintains the circumstances here are unlike those in Mike Davidov Co. v. Issod (2000) 78 Cal.App.4th 597 and other cases (StreetScenes v. ITC Entertainment Group, Inc. (2002) 103 Cal.App.4th 233, 243-244 [following Davidov] and Caira v. Offner (2005) 126 Cal.App.4th 12, 37-41 [same]). In Davidov, the Court of Appeal upheld a punitive damage award against a defendant who, like Ravet, was ordered to produce financial records just prior to the punitive damages phase of trial but failed to do so. The appellate court observed that the defendant had not challenged that production order on appeal, and by failing to bring any records reflecting his financial condition he had waived any right to complain about the lack of such evidence. (Id. at pp. 608-609.) The court rejected the defendant's claim that the $96,000 punitive damage award was not supported by any evidence of the defendant's net worth, and found the award was not precluded by the fact the plaintiffs had not conducted pretrial discovery, subpoenaed documents to be available at trial, or formally moved to bifurcate the liability and punitive damage phases. (Id. at pp. 606-609.) It reasoned: "[O]nce there has been a determination of liability by the trier of fact based on an actual weighing of the credibility of witnesses, [the affidavit-and-hearing procedure of Civil Code section 3295] is patently superfluous. So long as the trial court allows the defendant sufficient time, following a determination of liability, to collect his or her financial records for presentation on the issue of the amount of such damages to be awarded, there is nothing prejudicial or unfair about using such a process to try the issue of the amount of punitive damages. If anything, this method serves the purpose behind [Civil Code] section 3295, to wit, to protect against premature disclosure of the defendant's financial condition." (Davidov, 78 Cal.App.4th at p. 609.) The Court of Appeal held there was a valid basis on which a punitive damages award was proper: defendant's failure to obey a court order to produce his financial records. (Id. at p. 610.)
We reject Ravet's attempt to distinguish these cases. Here, as in Davidov, Ravet's meager and unspecific production — made after assuring the court he would comply with its order — deprived plaintiffs of the opportunity to meet their burden of proof on the issue of Ravet's financial condition for purposes of the punitive damage award. (See Davidov, supra, 78 Cal.App.4th at p. 609.) Ravet produced a cursory, unsubstantiated balance sheet and a checking account balance of only a couple thousand dollars, yet the evidence showed he lived in a La Jolla home that he had purchased (in his individual capacity and then immediately transferred to a trust) for $4 million and drove a 2005 model Mercedes Benz vehicle. Ravet testified during trial that in addition to practicing law since 1979 in a firm and as a sole practitioner, he had other businesses in real estate investment and development and as the president of a sports marketing company. In connection with the latter business, Ravet testified he consulted with well-known health clubs such as Bally's Total Fitness and Gold's Gym. He testified he spent about 50 percent of his time doing philanthropy, and also in liquidating his father's business interests and assets. He testified that several "big corporate sponsors" had hired him as a consultant to produce television shows, including five that were currently on the air. Yet, Ravet did not produce any information indicating he earned any income from these efforts. He further testified he had an estate plan and a trust into which he had put "all of my assets." He testified he had "put up all of the money" to help build the house in which he was presently living. But Ravet claimed he did not have any of the financial documents requested by plaintiffs including vehicle registrations, documents reflecting trusts in which he was a beneficiary, or documents reflecting any interest he had in real estate.
Under an appropriate jury instruction that Ravet does not directly challenge, the jury clearly found Ravet's financial evidence and testimony was not credible in light of the remaining evidence. The trial court was well within its discretion in concluding he did not make a full, good faith disclosure regarding his financial condition, and then in permitting plaintiffs to try the issue of punitive damages without any additional evidence of Ravet's financial condition. Ravet waived any claim of error by his failure to comply with the trial court's discovery order to produce financial records or to challenge that order on appeal, and he has shown to basis otherwise to vacate the punitive damages award.
III. Plaintiffs' Appeal
Plaintiffs contend the trial court was without authority to remit the punitive damages awards by way of a JNOV order; that as a result, the court's judgment on the special verdict based on its grant of JNOV necessarily fails, causing revival of the April 23, 2007 judgment. They base their contention on Teitel v. First Los Angeles Bank (1991) 231 Cal.App.3d 1593 (Teitel), though they recognize this court distinguished Teitel in Gober v. Ralphs Grocery Store (2006) 137 Cal.App.4th 204 (Gober).
Teitel involved a defendant's challenge to a punitive damage award by way of motion for JNOV, on grounds the award was not supported by substantial evidence and was excessive as a matter of law. (Teitel, supra, 231 Cal.App.3d at pp. 1600, 1602.) The Teitel defendant did not challenge the award's constitutionality. (Id. at p. 1602 & fn. 5; Gober, supra,137 Cal.App.4th at p. 212.) Teitel rejected the trial court's decision to reduce the award by granting JNOV, reasoning that damages were to be fixed by the trier of fact and, if inadequate or excessive, subject to the conditional new trial procedure of Code of Civil Procedure section 662.5. (Teitel, 231 Cal.App.3d at p. 1605.)
In Gober, we explained that since Teitel, state and federal appellate courts have been instructed to conduct de novo review of punitive damages awards challenged as constitutionally excessive. (Gober, supra, 137 Cal.App.4th at p. 212, citing State Farm Mut. Auto Ins. Co. v. Campbell (2003) 538 U.S. 408, 418 & Cooper Industries, Inc. v. Leatherman Tool Group, Inc. (2001) 532 U.S. 424, 433-434.) The rationale for independent review is that " ' "[u]nlike the measure of actual damages suffered, which presents a question of historical or predictive fact,... the level of punitive damages is not really a 'fact' 'tried' by the jury," ' " and that the constitutional excessiveness of a punitive damage award presents a legal issue that appellate courts can decide independently. (Gober,at pp. 212-213.) We pointed out that in Simon v. San Paolo U.S. Holding Co., Inc. (2005) 35 Cal.4th 1159 (Simon), the California Supreme Court had ordered an absolute reduction of a punitive damages award to the constitutionally allowed maximum rather than a remittitur, i.e., a conditional reduction with the alternative of a new trial. (Gober, at p. 213.) We rejected the same argument as plaintiffs make here: that the trial court could not have granted a directed verdict on the punitive damage issue because it was up to a jury to decide the truth of facts and then make an award: "Plaintiffs lose sight of the fact that a jury determined the amount of punitive damages to be awarded and the only question here is whether those awards were constitutionally excessive." (Id. at p. 213.)
Because a court determining the constitutional maximum of a punitive damage award does not decide whether the verdict is unreasonable based on the facts, making that decision without a remittitur does not violate plaintiffs' right to have a jury decide their punitive damages claims. (Gober, supra, 137 Cal.App.4th at p. 214.) "Moreover, '[o]nce a maximum constitutional award has been determined... a new trial on punitive damages would be futile. "Giving a plaintiff the option of a new trial rather than accepting the constitutional maximum for this case would be of no value. If, on a new trial, the plaintiff was awarded punitive damages less than the constitutional maximum, he would have lost. If the plaintiff obtained more than the constitutional maximum, the award could not be sustained." ' " (Ibid., quoting Simon, supra, 35 Cal.4th at p. 1188.) Noting the parties had already participated in two lengthy trials and the defendant was willing to forego a new trial and end the litigation by agreeing to a punitive damages verdict set at the constitutional maximum, we held in Gober that "there is no reason a trial or appellate court cannot decide to strike the portion of the punitive damages that is constitutionally excessive in the context of a JNOV motion and enter a verdict on a new amount." (Gober, 137 Cal.App.4th at p. 215.)
Plaintiffs seek to characterize Gober'slatter statement about a trial court's authority as dicta. However, given that the statement responded to arguments of the plaintiffs in that case, we view it differently. Nor do we see any reason to limit Gober to its facts, i.e., to circumstances where there had been prior trials or where the defendant expressly foregoes a new trial. We conclude the trial court was authorized to reduce the punitive damages award to its constitutional maximum by granting Ravet's motion for JNOV. In light of our conclusion, plaintiffs' remaining claims and Ravet's protective cross-appeal (in which he does not challenge the constitutionality or amount of the reduced punitive damages award) are moot.
Our conclusion also moots plaintiffs' request for judicial notice of certain federal court orders and records. Were we to consider it, we would deny the request in any event because in their request plaintiffs did not explain the relevance of those documents to the issues in their cross-appeal, and our consideration of their contents is limited. (See Mangini v. R.J. Reynolds Tobacco Co. (1994) 7 Cal.4th 1057, 1063 [only relevant matters may be judicially noticed and although "courts may notice official acts and public records, '[they] do not take judicial notice of the truth of all matters stated therein' "], overruled on another point in In re Tobacco Cases II (2007) 41 Cal.4th 1257, 1276.)
DISPOSITION
The judgment is affirmed. The parties are to bear their own costs on appeal.
WE CONCUR: HALLER, Acting P. J., IRION, J.
"(c) If the notice specified in subdivision (b) is served at least 20 days before the time required for attendance, or within any shorter period of time as the court may order, it may include a request that the party or person bring with him or her books, documents or other things. The notice shall state the exact materials or things desired and that the party or person has them in his or her possession or under his or her control. Within five days thereafter, or any other time period as the court may allow, the party or person of whom the request is made may serve written objections to the request or any part thereof, with a statement of grounds. Thereafter, upon noticed motion of the requesting party, accompanied by a showing of good cause and of materiality of the items to the issues, the court may order production of items to which objection was made, unless the objecting party or person establishes good cause for nonproduction or production under limitations or conditions. The procedure of this subdivision is alternative to the procedure provided by Sections 1985 and 1987.5 in the cases herein provided for, and no subpoena duces tecum shall be required.
"Subject to this subdivision, the notice provided in this subdivision shall have the same effect as is provided in subdivision (b) as to a notice for attendance of that party or person." (Code Civ. Proc., § 1987, subds. (b), (c).)