Collinge et al v. Intelliquick Delivery Incorporated et al

Filing 462

ORDER AND OPINION - Plaintiffs' motion at docket 439 is GRANTED. The declaration of Robert Crandall filed at docket 430 -1, and all references to the declaration, are hereby stricken. IntelliQuick is ordered to pay the Plaintiffs' reasonable expenses, including attorney's fees, incurred in bringing this motion. (See document for further details). Signed by Judge John W Sedwick on 9/5/17.(LAD)

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1 2 3 4 5 UNITED STATES DISTRICT COURT 6 DISTRICT OF ARIZONA 7 8 9 10 11 12 13 David Collinge, et al., ) ) Plaintiffs, ) ) vs. ) ) IntelliQuick Delivery, Inc., an Arizona ) corporation, et al., ) ) Defendants. ) ) 2:12-cv-00824 JWS ORDER AND OPINION [Re: Motion at Docket 439] 14 I. MOTION PRESENTED 15 At docket 439 plaintiffs David Collinge, et al. (collectively “Plaintiffs”) move the 16 court for an order striking the declaration of Robert Crandall, MBA (“Crandall”), an 17 expert retained by defendants IntelliQuick Delivery, Inc., et al. (collectively, 18 “IntelliQuick”), which was filed at docket 430-1 as Exhibit C to IntelliQuick’s Daubert 19 motion at docket 430; striking all references to Crandall’s declaration; and sanctioning 20 IntelliQuick under Rule 37(c). IntelliQuick opposes at docket 441. Plaintif fs reply at 21 docket 442. Oral argument was not requested and would not assist the court. 22 II. STANDARD OF REVIEW 23 Local Rule of Civil Procedure (“Local Rule”) 7.2(m) governs motions to strike. It 24 provides in pertinent part that a motion to strike may be filed “if it seeks to strike any 25 part of a filing or submission on the ground that it is prohibited (or not authorized) by a 26 27 28 1 statute, rule, or court order.” 1 The decision to grant or deny a motion to strike is within 2 the court’s discretion. 2 3 Rule 37(c)(1) states that if a party “fails to provide information or identify a 4 witness as required by Rule 26(a) or (e), the party is not allowed to use that information 5 or witness to supply evidence . . . unless the failure was substantially justified or is 6 harmless.” The court may also, or alternatively, “order payment of the reasonable 7 expenses, including attorney’s fees, caused by the failure” or “impose other appropriate 8 sanctions.”3 A district court is given “particularly wide latitude” when exercising its 9 discretion to issue sanctions under Rule 37(c)(1). 4 10 III. BACKGROUND 11 Plaintiffs’ expert, David M. Breshears, CPA, CCF (“Breshears”), prepared an 12 expert report dated December 2, 2016, that calculates the amount of unpaid wages that 13 Plaintiffs assert they are owed. Crandall submitted a rebuttal declaration dated 14 March 23, 2017. On May 23 the court approved the parties’ stipulated request to again 15 modify the court’s scheduling order.5 Among other things, this moved the deadline for 16 Plaintiffs’ expert rebuttal disclosures to June 6. On that date Plaintiffs’ submitted 17 Breshears’ June 5 rebuttal report. 6 18 On June 15 IntelliQuick’s counsel emailed Plaintiffs’ counsel requesting a new 19 extension of the discovery deadline to allow Crandall to provide a written response to 20 21 22 1 23 2 24 25 LRCiv 7.2(m)(1). Spencer v. Stapler, No. 2:04-cv-01532, 2006 WL 2052704, at *2 (D. Ariz. July 21, 2006). 3 Fed. R. Civ. P. 37(c)(1). 26 4 27 5 28 6 Yeti by Molly, Ltd. v. Deckers Outdoor Corp., 259 F.3d 1101, 1106 (9th Cir. 2001). Doc. 416. Doc. 417. -2- 1 Breshears’ June 5 rebuttal. 7 Plaintiffs declined, stating that sur-rebuttal expert reports 2 are not permitted without leave of court and if IntelliQuick wished to submit such a 3 report it would have to file a motion.8 IntelliQuick did not file such a motion. Instead, on 4 July 24 IntelliQuick produced Crandall’s 60-page sur-rebuttal report for the first time by 5 attaching it as Exhibit C to the Daubert motion it filed at docket 430. Plaintiffs now 6 move to strike. 7 IV. DISCUSSION 8 9 IntelliQuick produced Crandall’s July 24 declaration after the close of discovery. IntelliQuick advances two arguments for why it should nevertheless be allowed to 10 introduce this new evidence contemporaneously with its Daubert and summary 11 judgment motions. First, IntelliQuick argues that Crandall’s declaration is not a new 12 report but rather a supplement to his March 23 report that is allowed under Rule 26(e). 13 Alternatively, it argues that the court should accept its late-filed declaration because 14 doing so would be harmless and substantially justified. 15 A. Crandall’s New Declaration Is Not a Supplement Under Rule 26(e) 16 Rule 26(e) provides that a party must supplement or correct its expert’s report if 17 the party “learns that in some material respect the [report] is incomplete or incorrect.”9 18 In other words, a party must supplement an expert report “to correct inadvertent errors 19 or omissions. Supplementation, however, is not a license to amend an expert report to 20 avoid summary judgment.”10 “Courts distinguish ‘true supplementation’ (e.g., correcting 21 inadvertent errors or omissions) from gamesmanship, and have therefore repeatedly 22 23 7 24 25 26 27 28 Doc. 421-2 at 11. 8 Id. at 14. 9 Fed. R. Civ. P. 26(e)(1)(A). 10 8A CHARLES ALAN W RIGHT & ARTHUR R. MILLER, FEDERAL PRACTICE AND PROCEDURE: CIVIL § 2049.1 (3d ed. 2017) (quoting Gallagher v. S. Source Packaging, LLC, 568 F. Supp. 2d 624, 630 (E.D.N.C. 2008)). -3- 1 rejected attempts to avert summary judgment by ‘supplementing’ an expert report with a 2 ‘new and improved’ expert report.”11 3 The new Crandall report is of the latter variety. Crandall’s new report is clearly a 4 new expert report that rebuts Breshears’ June 5 report, not a correction to or an 5 expansion of Crandall’s previous report.12 Thus, this case is easily distinguishable from 6 the cases upon which IntelliQuick relies.13 Because Crandall’s new report does not 7 correct a deficiency in his previous report, Rule 26(e) does not apply.14 8 B. Crandall’s New Declaration Is Not Substantially Justified or Harmless 9 With regard to harm, Plaintiffs assert that they will be prejudiced if the court 10 considers Crandall’s report because discovery has closed and, therefore, they are 11 unable to depose Crandall about his new opinions. In response, IntelliQuick argues 12 that Plaintiffs cannot complain of surprise because Crandall’s new opinions are 13 14 11 15 12 16 13 17 18 19 20 21 22 23 24 25 26 27 28 Gallagher, 568 F. Supp. 2d at 631 (collecting cases). Doc. 430-1 at 23. See Miller v. Pfizer, Inc., 356 F.3d 1326, 1332 (10th Cir. 2004) (“[O]n occasion it may be appropriate to permit the party using the expert to submit supplements to the report in response to assertions by opposing experts that there are gaps in the expert’s chain of reasoning.”) (emphasis added); Innovation Ventures, LLC v. NVE, Inc., 90 F. Supp. 3d 703, 710 (E.D. Mich. 2015) (“As to the New Sarel Report, Magistrate Judge Whalen correctly found that this report was ‘substantially responsive’ to the criticisms leveled against the Original Sarel Report by Defendant’s expert witness, Dr. Jacoby.”); Charles v. Sanchez, No. EP-13-CV-00193-DCG, 2015 WL 808417, at *9 (W.D. Tex. Feb. 24, 2015) (“After reviewing the reports and deposition submitted with the briefs it is apparent that substantively Dr. Kaim’s Addendum is not a new opinion. Rather, it presents the scientific studies that underlie the methodology used to reach his original conclusion.”); In re Enron Corp. Sec., Derivative & “Erisa” Litig., No. CIV.A. G-02-0299, 2007 WL 5023541, at *8 (S.D. Tex. Feb. 1, 2007) (“Denis’s supplemental report is not a new opinion, but presents data that support Abbott’s original conclusion and correct the flaw in her comparison of underlying data.”); Confederated Tribes of Siletz Indians of Oregon v. Weyerhaeuser Co., No. CV 00-1693-PA, 2003 WL 23715981, at *2 (D. Or. Jan. 21, 2003) (“The supplemental expert testimony was generated in direct response to Defendant’s attack upon the original expert reports.”). 14 See Plumley v. Mockett, 836 F. Supp. 2d 1053, 1064 (C.D. Cal. 2010) (“Haas’s ‘supplemental’ report, rather than correcting an error or omission in his prior report, provides a new opinion that is designed to strengthen Defendants’ legal argument for inequitable conduct, and as a result is not a proper supplement under Rule 26(e).”). -4- 1 consistent with his previous opinions. IntelliQuick does not elaborate on this assertion, 2 and contradicts it somewhat where it argues that Plaintiffs have actually been 3 advantaged by the new Crandall report because “Plaintiffs have now learned of 4 Mr. Crandall’s responses to Plaintiffs’ expert’s attacks prior to trial.”15 5 6 7 8 9 10 11 IntelliQuick has not met its burden of proving harmlessness.16 As the district court in Coles v. Perry persuasively explains: The interest served by requiring the disclosure of expert opinions is self evident. It is to prevent unfair surprise at trial and to permit the opposing party to prepare for the expert’s cross examination. By “locking” the expert witness into what Fed. R. Civ. P. 26(a)(2)(B) calls “a complete statement of all opinions to be expressed and the basis and reasons therefor,” the opposing party knows exactly what she is facing and can decide whether to take the deposition of the expert and how to prepare for cross examination and rebuttal. When the expert supplements her report by addressing a new matter after discovery has ended, the very purpose of the rule is nullified.17 12 IntelliQuick next argues that Crandall’s new report is substantially justified 13 because it reasonably believed that the report was supplemental under Rule 26(e) and 14 because striking Crandall’s new report would be too harsh. 18 IntelliQuick’s belief that 15 Crandall could submit a new report under Rule 26(e) that neither completes nor 16 corrects his old report is not supported by the text of the rule or any case cited by 17 IntelliQuick. In other words, its belief was unreasonable. 18 IntelliQuick’s argument that striking Crandall’s new report would be too harsh 19 relies on the Perez v. First American Title Insurance.19 In Perez, the plaintiffs submitted 20 a supplemental expert report after the close of discovery in which the expert expressed 21 his opinions on “significant electronic data” that the plaintiffs received after the 22 23 15 24 16 25 Doc. 441 at 9. Yeti by Molly, 259 F.3d at 1107 (“[T]he burden is on the party facing sanctions to prove harmlessness.”). 26 17 27 18 28 19 Coles v. Perry, 217 F.R.D. 1, 4 (D.D.C. 2003). Doc. 441 at 11. 810 F. Supp. 2d 986, 989 (D. Ariz. 2011). -5- 1 deadlines for disclosing expert and rebuttal reports. 20 In light of this newly discovered 2 evidence, the court concluded that the supplem ent was substantially justified. Perez is 3 of no avail to IntelliQuick. Here, Crandall is not even supplementing his old report, let 4 alone doing so to incorporate newly obtained evidence.21 Requiring IntelliQuick to 5 comply with discovery deadlines is not unduly harsh. 6 7 V. CONCLUSION Based on the preceding discussion, plaintiffs’ motion at docket 439 is 8 GRANTED. The declaration of Robert Crandall filed at docket 430-1, and all references 9 to the declaration, are hereby stricken. IntelliQuick is ordered to pay the Plaintiffs’ 10 reasonable expenses, including attorney’s fees, incurred in bringing this motion. If the 11 parties cannot stipulate to the amount of expenses that IntelliQuick must pay Plaintiffs, 12 then within 14 days from the date of this order Plaintiffs shall file a properly supported 13 motion showing their reasonable expenses and IntelliQuick shall respond within 7 days 14 after the motion is filed. No reply may be filed unless requested by the court. 15 DATED this 5th day of September 2017. 16 17 /s/ JOHN W. SEDWICK SENIOR JUDGE, UNITED STATES DISTRICT COURT 18 19 20 21 22 23 24 25 26 27 28 20 Id. 21 Doc. 430-1 at 23 (Crandall states that “[t]he only new data that was provided to [him] since [his] last declaration [was] a list of Drivers containing their home addresses.”). -6-

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