United States of America v. Gachette

Filing 33

ORDER granting 28 Motion for leave to take up to 100 fact depositions. Signed by Magistrate Judge Thomas B. Smith on 2/9/2015. (SMW)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
ORLANDO DIVISION
UNITED STATES OF AMERICA,
Plaintiff,
v.

Case No: 6:14-cv-1539-Orl-22TBS

WALNER G. GACHETTE, individually
and d/b/a LBS TAX SERVICES, LOAN
BUY SELL, INC., GACHETTE, LLC, WG
GROUP, LLC, ZGT GROUP, LLC, JGT
GROUP, LLC and INTERNATIONAL
HIRING, LLC,
Defendants.
ORDER
This matter is before the Court on the United States’ Motion for Leave to Take
More than 10 Fact Depositions (Doc. 28). Defendant Walner G. Gachette opposes the
motion (Doc. 32).
Plaintiff alleges that Gachette and others acting in concert with him and at his
direction are behind multiple limited liability companies that operated as tax preparation
businesses (Doc. 1). Over a multi-year period, Gachette and others allegedly promoted
and encouraged the employees of those tax preparation businesses to prepare tens of
thousands of false and fraudulent federal income tax returns which resulted in payment
by Plaintiff of millions of dollars in bogus tax refunds to customers of the tax preparation
businesses (Id.). This alleged scheme involved at least 56 tax preparation stores
operating throughout the Southeastern United States (Doc. 28). The Internal Revenue
Service has interviewed 94 customers who had their tax returns prepared at Gachetteowned tax return preparation stores in the Orlando metropolitan area to determine the tax

loss for tax year 2012 (Id.). Now, Plaintiff seeks leave of Court to take up to 100 fact
depositions to provide the Court with testimony from witnesses whose returns were
prepared in several different geographic areas, over several different years, and which
involved different types of fraud (Id.). Plaintiff also seeks to depose Defendants’
employees and other persons associated with the tax preparation businesses who may
not be located in this district, and who may be hostile witnesses (Id.). In at least four
related cases 6:14-cv-1534-Orl-22TBS, 6:14-cv-1536-Orl-22TBS, 6:14-cv-1537-Orl22TBS, and 6:14-cv-1538-Orl-22TBS, Plaintiff made like motions that were granted
without objection.
When a party seeks leave of court to take more than the ten depositions allowed
by Fed.R.Civ.P. 30(a)(2)(A), the Court considers the principles set out in Rule
26(b)(2)(C):
On motion or on its own, the court must limit the frequency or
extent of discovery otherwise allowed by these rules or by
local rule if it determines that: (i) the discovery sought is
unreasonably cumulative or duplicative, or can be obtained
from some other source that is more convenient, less
burdensome, or less expensive; (ii) the party seeking
discovery has had ample opportunity to obtain the information
by discovery in the action; or (iii) the burden or expense of the
proposed discovery outweighs its likely benefit, considering
the needs of the case, the amount in controversy, the parties'
resources, the importance of the issues at stake in the action,
and the importance of the discovery in resolving the issues.
FED. R. CIV. P. 26(b)(2)(C).
Gachette opposes Plaintiff’s motion on the ground that it has not exhausted the 10
depositions allowed it by Fed.R.Civ.P. 30. Ordinarily, before a motion to take more than
ten depositions will be granted the movant must justify the necessity of the depositions
already taken in the case. See F.D.I.C. v. Nason Yeager Gerson White & Lioce, P.A.,

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Case No. 2:13-cv-208-FtM-38CM, 2014 WL 1047245 at *2 (M.D.Fla. Mar. 17, 2014); AIG
Centennial Ins. Co. v. O’Neill, Case No. 09-60551, 2011 WL 4116555 at *16 (S.D.Fla.
Oct. 18, 2010) (“Courts have construed Rule 30(a)(2)(A), FED.R.CIV.P., to require a party
seeking leave of court to exceed the ten-deposition limitation to justify the necessity of
each deposition previously taken without leave of court.”); Royal v. Bahamian Ass’n, Inc.
v. QBE Ins. Corp., Case No. 10-21511-CIV, 2010 WL 3003914 at *2 (S.D.Fla., July 29,
2010) (“[A] party seeking a court’s leave to take more than ten depositions under Rule 30
‘must demonstrate the necessity for each deposition she took without leave of court
pursuant to the presumptive limit of Rule 30(a)(2)(A).’”) (quoting Barrow v. Greenville
Indep. Sch. Dist., 202 F.R.D. 480, 482 (N.D.Tex. 2001)).
Although Plaintiff has not taken any depositions and therefore, its motion would
ordinarily be premature, this is not an ordinary case. Plaintiff is alleging illegal activity
occurring throughout the Southeastern United States over a multi-year period. The
alleged tax fraud involves the use of multiple different false deductions and bogus credits
to generate and file tens of thousands of untruthful income tax returns, resulting in
millions of dollars in losses. Given the scope of the allegations, including the number of
people involved, the Court has no difficulty in concluding that Plaintiff will require more
than 10 depositions.
Gachette also argues that Plaintiff has already identified 94 potential witnesses in
the Orlando area, and that if allowed, the depositions will be unreasonably duplicative
and cumulative. Plaintiff counters that the testimony of many witnesses will be required
to prove the widespread and systemic nature of the alleged fraud. The Court is not
persuaded that this can be accomplished by relying solely on the 94 local customers who
have already been interviewed. It is reasonable to assume Plaintiff will need to depose

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many customers and employees located in multiple states and involving different alleged
fraudulent techniques, to prepare and present its case.
Next, Gachette argues that Plaintiff can use the depositions to be taken in the
related cases in this case, and therefore, the additional discovery Plaintiff seeks is both
unnecessary, and will unreasonably subject Gachette to the expense of travelling to
multiple states to take additional depositions. Federal Rule of Civil Procedure
32(a)(1)(A) provides a deposition may be used against a party at trial or in a hearing if
“the party was present or represented at the taking of the deposition or had reasonable
notice of it.” Unless Gachette agrees that Plaintiff may notice him on the depositions to
be taken in the other cases, and that those depositions can be used in this case, the
depositions to be taken in the related cases will not be available for use in this case.
Now, after due consideration, the Court finds that the depositions Plaintiff seeks to
take will not be “unreasonably cumulative or duplicative,” and that they cannot “be
obtained from some other source that is more convenient, less burdensome, or less
expensive.” FED.R.CIV.P. 26(b)(2)(C)(i). The Court finds that Plaintiff has not “had
ample opportunity to obtain the information by discovery in the action.” FED.R.CIV.P.
26(b)(2)(C)(ii). And, the Court finds that “the burden or expense of the proposed
discovery” does not outweigh “its likely benefit, considering the needs of the case, the
amount in controversy, the parties' resources, the importance of the issues at stake in the
action, and the importance of the discovery in resolving the issues.” FED.R.CIV.P.
26(b)(2)(C)(iii). Accordingly, Plaintiff’s motion is GRANTED and it is authorized to take
up to 100 fact depositions in this case.
IT IS SO ORDERED.

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DONE and ORDERED in Orlando, Florida on February 9, 2015.

Copies furnished to Counsel of Record

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