Alexander v. Allen et al

Filing 49

ORDER denying 41 Defendants' Motion to Stay Discovery and/or Motion for Protective Order. Signed by Magistrate Judge Carol Mirando on 8/7/2014. (BLW)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
STUART ALEXANDER, an
individual,
Plaintiff,
v.

Case No: 2:13-cv-885-FtM-29CM

JAMES F. ALLEN and HERTEL
PARK ASSOCIATES I, LLC,
Defendants.
ORDER
Before the Court is Defendants’ Motion to Stay Discovery and/or Motion for
Protective Order (Doc. 41, “Motion to Stay/Protective Order”) and Plaintiff Stuart
Alexander’s Response in Opposition (Doc. 46). Defendants James F. Allen (“Allen”)
and Hertel Park Associates I, LLC, jointly request to stay discovery of this matter,
citing Chudasama v. Mazda Motor Corp., 123 F.3d 1353 (11th Cir. 1983), pending a
ruling by the Court on their Motion to Dismiss Amended Complaint and Motion to
Strike (Doc. 40), which asserts failure to state a claim upon which relief may be
granted pursuant to Federal Rule 12(b)(6). In the event the Court does not stay
discovery, Allen requests that a protective order be entered by the Court to limit
discovery related to Allen’s financial net worth pending resolution of Defendants’
Motion to Strike Plaintiff’s punitive damages claims. For the reasons stated herein,
the Motion to Stay/Protective Order is denied.

I.

Motion to Stay

While motions to stay discovery may be granted pursuant to Federal Rule
26(c), the moving party bears the burden of showing good cause and reasonableness.

McCabe v. Foley, 233 F.R.D. 683, 685 (M.D. Fla. 2006). In Chudasama, the Eleventh
Circuit noted that “[f]acial challenges to the legal sufficiency of a claim or defense,
such as a motion to dismiss based on failure to state a claim for relief, should . . . be
resolved before discovery begins.

Such a dispute always presents a purely legal

question; there are no issues of fact because the allegations contained in the pleading
are presumed to be true.” Id. at 1367 (footnote omitted). “Therefore, neither the
parties nor the court have any need for discovery before the court rules on the
motion.” Id.; Horsley v. Feldt, 304 F.3d 1125, 1131 n.2 (11th Cir. 2002). However,

Chudasama does not stand for the proposition that all discovery in every
circumstance should be stayed pending a decision on a motion to dismiss. Koock v.

Sugar & Felsenthal, LLP, 2009 WL 2579307, at *2 (M.D. Fla. Aug. 19, 2009).
“Instead, Chudasama and its progeny ‘stand for the much narrower proposition that
courts should not delay ruling on a likely meritorious motion to dismiss while undue
discovery costs mount.’” Id. (citing In re Winn Dixie Stores, Inc., 2007 WL 1877887,
at *1 (M.D. Fla. June 28, 2007)).
In deciding whether to stay discovery pending resolution of a motion to dismiss,
the court must balance the harm produced by a delay in discovery against the
possibility that the motion will be granted and entirely eliminate the need for such
discovery.

McCabe, 233 F.R.D. at 685.

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To this end, the court must take a

“preliminary peek” at the merits of the dispositive motion to see if it “appears to be
clearly meritorious and truly case dispositive.” Id. (citation and internal quotation
marks omitted).
Defendants argue that good cause exists to grant the stay because they have
made a likely meritorious facial challenge to Plaintiff’s Amended Complaint and if
discovery goes forward, unnecessary costs will be incurred. Defendant Allen further
argues that he will be prejudiced if discovery is allowed because Plaintiff is
improperly seeking discovery related to Allen’s financial net worth and the claims for
punitive damages should be striken. Plaintiff responds that Defendants have not
moved to dismiss all of the counts in the amended complaint, and a stay will result
in significant prejudice because it would likely not allow the parties time to conduct
the necessary discovery before the October 10, 2014 discovery deadline. The Court
agrees with Plaintiff.
The Court has reviewed the Motion to Dismiss and Strike (Doc. 40) and
Response (Doc. 44) and finds that it is not so clearly meritorious and truly case
dispositive such that the need for discovery in this case will be entirely eliminated.
Given this, the Court finds that delaying discovery until the Court rules on the Motion
to Dismiss and Strike will cause Plaintiff harm and his case will go forward.
II.

Protective Order

Alternatively, Allen requests that the Court enter a protective order to limit
discovery related to his financial net worth, pending resolution of Defendants’ Motion
to Strike Plaintiff’s punitive damages claims.

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The Court has already ruled that

limited discovery of Allen’s financial net worth is proper and will proceed. Doc. 48.
As the Court noted in that Order, because financial documents often contain sensitive
and confidential information, the parties are directed to meet and confer and come to
an agreement regarding information that will be deemed confidential and whether a
confidentiality order needs to be entered in this matter.
III.

Attorney’s Fees and Costs

Plaintiff moves pursuant to Federal Rule 37(a)(5)(B) for an award of attorney’s
fees and costs incurred in responding to Allen’s request for a protective order. No
further argument is included and an amount of attorney’s fees and costs incurred is
not stated.

Pursuant to Federal Rule 37, if a motion for an order compelling

disclosure or discovery is denied, the prevailing party may be awarded “reasonable
expenses incurred in opposing the motion, including attorney’s fees.” Fed. R. Civ. P.
37(a)(5)(B).
In the instant Motion, Defendants have not moved for an order compelling
disclosure or discovery and Rule 37 does not state it is applicable to requests to stay
or for protective orders. Therefore, the request for attorney’s fees and costs is denied.
ACCORDINGLY, it is hereby
ORDERED:
Defendants’ Motion to Stay Discovery and/or Motion for Protective Order (Doc.
41) is DENIED.

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DONE and ORDERED in Fort Myers, Florida on this 7th day of August, 2014.

Copies:
Counsel of record

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