Brokers' Choice of America, Inc. et al v. NBC Universal, Inc. et al
Filing
143
ORDER ON MOTION FOR DISCOVERY ON FACTS ISUUES RELEVANT TO GENERAL ELECTRIC CO.'S PENDING MOTIONS by Magistrate Judge Nina Y. Wang on 8/14/15. Based on the court's review of the papers and application of the pertinent case law, IT IS HEREBY ORDERED that the Motion for Discovery 139 is DENIED. (bsimm, )
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Civil Action No. 09-cv-717-CMA-NYW
BROKERS’ CHOICE OF AMERICA, INC., and
TYRONE M. CLARK,
Plaintiffs,
v.
NBC UNIVERSAL, INC.,
GENERAL ELECTRIC CO.,
CHRIS HANSEN,
STEVEN FOX ECKERT,
MARIE THERESA AMOREBIETA,
Defendants.
______________________________________________________________________
ORDER ON MOTION FOR DISCOVERY ON FACTS ISUUES RELEVANT TO
GENERAL ELECTRIC CO.’S PENDING MOTIONS
______________________________________________________________________
Magistrate Judge Nina Y. Wang
This matter comes before the court on Plaintiffs Brokers’ Choice of America, Inc.
(“Brokers’ Choice”) and Tyrone M. Clark (“Mr. Clark”) (hereinafter collectively “Plaintiffs”)
Motion for Rule 56(d)(2) Discovery on Fact Issues Relevant to Defendant General
Electric Co.’s Pending Motions, filed on May 7, 2015 [#139] (the “Motion for Discovery”).
Pursuant to the Order Referring Case dated April 7, 2009 [#3], the Reassignment dated
February 10, 2015 [#138], and the Memorandum dated May 4, 2015 [#140], the Motion
for Discovery is before this Magistrate Judge.
Having considered the Motion for
Discovery and Defendants’ Response [#141], the case file in the instant action, the
applicable case law, and finding that oral argument would not materially assist in its
disposition, the court hereby for the reasons set forth herein ORDERS that the Motion
for Discovery be DENIED.
BACKGROUND AND RELEVANT PROCEDURAL HISTORY
I.
Plaintiffs’ Original Complaint.
Plaintiffs Brokers’ Choice of America, Inc. (“Brokers’ Choice”) and Tyrone M. Clark
(“Mr. Clark”) (hereinafter collectively “Plaintiffs”) filed their original Complaint in this
matter on March 31, 2009.
[#1].
Below, the court recites certain allegations from
Plaintiffs’ original Complaint, which remain relevant to the disposition of the pending
Motion for Discovery.
According to the Complaint, this case arises out of a broadcast in the spring of
2008 on NBC Universal, Inc.’s (“NBC Universal”) Dateline NBC (a news magazine
focused on investigation and exposes) entitled “Tricks of the Trade.” [Id. at ¶¶ 9, 25].
Plaintiffs allege that the broadcast “defamed Plaintiff Tyrone M. Clark and the company
he founded, Plaintiff Brokers’ Choice of America.” [Id.].
The broadcast consisted of investigative journalism targeted at a “private
educational class concerning insurance products” offered by Mr. Clark. [Id. at ¶¶ 9-11].
Because the seminar was limited to licensed insurance agents, in the process of
preparing to compose the broadcast, Dateline NBC producers Steven Fox Eckert (“Mr.
Eckert”) and Marie Theresa Amorebieta (“Ms. Amorebieta”) obtained insurance
producer licenses from the state of Alabama. [Id. at ¶ 11]. They then subsequently
traveled to Colorado in the fall of 2007 and attended a seminar offered by Mr. Clark on
October 25th and October 26th and surreptitiously recorded portions of the seminar. [Id.
at ¶ 24]. According to the Complaint, the eventual April 13, 2008 “Tricks of the Trade”
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broadcast, narrated by Dateline reporter Chris Hansen, misleadingly represented the
contents of Mr. Clark’s teachings during the October of 2007 seminar. [Id. at ¶¶ 64-82].
Based on these and other allegations, Plaintiffs asserted claims for defamation,
trespass, invasion of privacy, and a 42 U.S.C. § Section 1983 claim for violation of
Plaintiffs’ Fourth and Fourteenth Amendment rights.
[Id. at ¶ 16].
The named
Defendants consisted of Dateline producers Mr. Eckert and Ms. Amorebieta, Dateline
reporter Chris Hansen, NBC Universal, and General Electric Company (“GE”). [Id. at ¶¶
3-7]. GE was alleged to be a controlling owner of NBC Universal, with an 80% share of
the company. [Id. at ¶ 4]. A GE official also allegedly stated that it regarded NBC
Universal employees as “its own.” [Id. at ¶ 53].
On June 1, 2009, Defendants filed a Motion to Dismiss pursuant to Fed. Rule
Civ. P. 12(b)(6) as to Plaintiffs’ original Complaint.
[#10]. The Motion to Dismiss
included an argument that the original Complaint was devoid of allegations sufficient to
maintain suit against GE based on vicarious liability, and that because of this purported
pleading deficiency, GE should be dismissed from the case. [Id. at 43-44].
On October 23, 2009, this court found that Plaintiffs’ original Complaint failed to
state a viable defamation claim, and that Plaintiffs’ additional claims for trespass,
invasion of privacy, and (under Section 1983) for violation of Plaintiffs’ Fourth and
Fourteenth Amendment rights were barred as derivative. [#36, #38]. The court did not
reach Defendants’ independent argument that the original Complaint failed to allege
sufficient facts as to GE to allow for maintenance of suit against GE on a vicarious
liability theory. [#38]. Plaintiffs were permitted leave to file an amended complaint, and
discovery was stayed unless and until Plaintiffs stated a viable claim. [#36, #38].
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II.
Plaintiffs’ Amended Complaint.
On November 20, 2009, Plaintiffs filed their Amended Complaint. [#39]. The
Amended Complaint included a defamation claim, and a Section 1983 claim again
premised on purported violations of Plaintiffs’ Fourth and Fourteenth Amendment rights.
[Id. ¶¶ 125-136]. As to GE, Plaintiffs again alleged that GE owned a 80% stake in NBC
Universal, and that Plaintiffs’ counsel was told by a “highly placed” official of GE that
“NBC’s employees are considered employees of GE by the company.” [Id. at ¶¶ 4, 56].
On November 20, 2009, Plaintiffs also filed a Motion to Compel, seeking to set
the court’s stay of discovery aside to compel disclosure of a discrete category of items:
any tape recordings or transcripts of the footage taken by Mr. Eckert and Ms.
Amorebieta at the October 2007 seminar. [#40] (the “Motion to Compel”). On January
7, 2010, this court denied the Motion to Compel. [#56].
On December 22, 2009, Defendants filed a renewed Motion to Dismiss Plaintiffs’
Amended Complaint. [#49]. The Defendants again argued that Plaintiffs failed to plead
facts sufficient to pierce the corporate veil as to GE, and also argued that GE could not
be held liable for the actions of the employees of a subsidiary on a theory of respondent
superior. [Id. at 47-49].
On January 11, 2011, the court found that Plaintiff’s Amended Complaint failed to
state a viable defamation claim as to any Defendant. [#77]. The court also found that
Plaintiffs failed to adequately plead that any Defendant was a state actor for purposes of
imposition of Section 1983 liability. [Id. at 19-24]. The court did not reach the issue of
whether sufficient facts were pled as to GE to maintain suit against GE on a vicarious
liability theory. [#77].
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On January 27, 2011, Plaintiffs filed a notice of appeal. [#82]. On July 9, 2014,
the Tenth Circuit ruled that Plaintiffs’ Amended Complaint pled a viable defamation
claim and that Plaintiffs were entitled to discovery of the unedited film of the seminar,
but otherwise affirming this court’s dismissal order as to the Amended Complaint.
[#103]. The decision was docketed with this court that same day. [Id.]. In so ruling, the
Tenth Circuit suggested that, on remand, “resolution of the defamation claim would not
be particularly complicated,” as “the judge or a properly instructed jury could view the
Dateline segment as aired, compare it to what Clark said over the course of his two-day
seminar and decide whether the aired program gave a false impression of his seminar;
in other words, whether the segment was not substantially true.” Brokers' Choice of
America, Inc. v. NBC Universal, Inc., 757 F.3d 1125, 1132 (10th Cir. 2014). The Tenth
Circuit did not reach the issue (undecided below) of whether Plaintiffs pled sufficient
facts in their Amended Complaint to maintain suit against GE based on the actions of
NBC Universal employees. Id. at 1125-50.
III.
Subsequent Relevant Procedural History and Instant Motion for Discovery
On August 18, 2014, Defendants filed an unopposed motion to set the deadline
for Defendants to answer or otherwise move in response to Plaintiffs’ Amended
Complaint to September 12, 2014, which the court granted.
[#105, #106].
On
September 12, 2014, Defendants filed a Motion to Dismiss the Amended Complaint, or
in the Alternative, for Summary Judgment (“Motion to Dismiss or for Summary
Judgment” or “Motion”), of Plaintiffs’ defamation claims as to all Defendants, and
seeking dismissal of GE as a Defendant on the independent ground that the Amended
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Complaint fails to state facts sufficient to hold GE liable for the actions of its subsidiary
NBC Universal’s employees. [#111].
On November 11, 2014, Plaintiffs filed their opposition to the pending Motion to
Dismiss or for Summary Judgment. [#130]. On December 12, 2014, Plaintiffs filed an
unopposed motion for a hearing for the Motion. [#137]. The Motion to Dismiss or for
Summary Judgment, and the request for a hearing on that Motion, are currently before
the Honorable Christine M. Arguello.
It was not until April 30, 2015 – more than six months after the Motion to Dismiss
or for Summary Judgment was originally filed and more than four months after the
Motion was fully briefed as of December 9, 2014 – that Plaintiffs filed the instant Motion
for Discovery, invoking Fed. Rule Civ. P. 56(d) and requesting leave to pursue
“discovery on fact issues relevant to GE’s control of the business activities of its former
80% owned subsidiary NBC.”
[#139 at 1].
In response, Defendants contend that
insofar as Defendants’ pending Motion to Dismiss or for Summary Judgment seeks
dismissal of GE on the ground that the Amended Complaint fails to plead facts sufficient
to allow for imposition of vicarious liability as to GE on either an alter ego or respondeat
superior theory, the challenge is based purely on the asserted insufficiency of the
allegations in Plaintiffs’ Amended Complaint—and that no discovery is necessary to
resolve this facial challenge to Plaintiffs’ pleadings. [#141].
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ANALYSIS
I.
Standard of Review
To make the showing necessary to obtain relief pursuant to Fed. Rule Civ. P.
56(d), a party must do more than assert “that the evidence supporting [the party’s]
allegation is in the hands of the [opposing party].” Weir v. Anaconda Co., 773 F.2d
1073, 1083 (10th Cir. 1985). Instead, the party invoking Rule 56(d) “must show how
additional time will enable him to rebut [the] movant’s allegations of no genuine issue of
fact.” Jensen v. Redevelopment Agency of Sandy City, 998 F.2d 1550, 1554 (10th Cir.
1993) (citation and quotation omitted). The decision to grant additional discovery under
to Rule 56(d) is within the district court’s discretion. Patty Precision v. Brown & Sharpe
Mfg. Co., 742 F.2d 1260, 1264 (10th Cir. 1984); see also Pfenninger v. Exempla, Inc.,
116 F .Supp. 2d 1184, 1194 (D. Colo. 2000) ( “The district courts exercise discretion in
deciding whether to grant a [Rule 56(d) ] motion.”). “[I]f the party filing the Rule [56(d)]
affidavit has been dilatory . . . , no extension will be granted.” Jensen, 998 F.2d at 1554
(10th Cir. 1993) (denying request where “the record reflect[ed] that plaintiffs were
dilatory in pursuing discovery prior to the filing of their [56(d)] affidavit”); see also Patty
Precision, 742 F.2d at 1264-65 (“Furthermore, if the party filing the Rule [56(d)] affidavit
has been dilatory, or the information sought is either irrelevant to the summary judgment
motion or merely cumulative, no extension will be granted.”).
Moreover, “discovery is not necessary to resolve a motion to dismiss for failure to
state a claim for relief” because the court’s “function on a Rule 12(b)(6) motion is not to
weigh potential evidence that the parties might present at trial, but to assess” whether a
viable claim for relief is present on the pleadings. Sheldon v. Khanal, 502 Fed. Appx.
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765, 2012 WL 5860560 at *7 (10th Cir. 2012) (unpublished) (quotation omitted) (citing
Peterson v. Grisham, 594 F.3d 723, 727 (10th Cir. 2010)).
One of the principal
purposes of requiring a Plaintiff to state a plausible claim for relief is “to avoid ginning up
the costly machinery associated with our civil discovery regime on the basis of ‘a largely
groundless claim.’” Pace v. Swerdlow, 519 F.3d 1067, 1076 (10th Cir .2008) (Gorsuch,
J., concurring) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 557, 127 S.Ct. 1955,
167 L.Ed.2d 929 (2007)).
II.
Application to Motion for Discovery
In response to the Motion for Discovery, Defendants correctly note that insofar as
the pending Motion to Dismiss or For Summary Judgment seeks to challenge GE’s
vicarious liability, its attack is a facial one to the facts as pled in Plaintiffs’ Amended
Complaint pursuant to Fed. Rule Civ. P. 12(b)(6), and is not a motion for summary
judgment pursuant to Rule 56 on the ground that there is no triable material issue of fact
as to vicarious liability on the evidentiary record now before the court. [#141 at 6]. In
addition, Defendants represented to both Plaintiffs and this court that they were willing
to stipulate to the court’s consideration of GE’s vicarious liability as one pursuant to
Rule 12(b)(6) – an analysis that is plainly based on the allegations set forth within the
four corners of the Amended Complaint. Plaintiffs contend that their vicarious liability
allegations as pled “provide a sufficient basis for denial of GE’s improperly renewed
Rule 12(b)(6) motion,” [#139 at 2]. Because “discovery is not necessary to resolve a
motion to dismiss for failure to state a claim for relief,” Sheldon, 2012 WL 5860560 at *7
(citation and quotation omitted), and because Plaintiffs waited more than five years after
GE first challenged the sufficiency of Plaintiffs’ allegations as to GE’s vicarious liability
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to seek related factual discovery, I decline to order discovery that was belatedly
requested and appears to be of marginal value.
CONCLUSION
Based on the court’s review of the papers and application of the pertinent case
law, IT IS HEREBY ORDERED that the Motion for Discovery [#139] is DENIED.
DATED August 14, 2015.
BY THE COURT:
/s/ Nina Y. Wang___________
United States Magistrate Judge
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