ALOSTAR BANK OF COMMERCE v. GLS FLORIDA PROPERTY 2 LLC et al
Filing
79
ORDER granting in part and denying in part 60 Motion to Compel Responses to Plaintiff's Personal Jurisdiction Discovery by Plaintiff. Signed by MAGISTRATE JUDGE GARY R JONES on 7/17/2012. (jws)
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IN THE UNITED STATES DISTRICT COURT FOR THE
NORTHERN DISTRICT OF FLORIDA
PANAMA CITY DIVISION
ALOSTAR BANK OF COMMERCE,
Plaintiff,
v.
CASE NO. 5:11-cv-406-RS-GRJ
GLS FLORIDA PROPERTY 2, LLC, et al.,
Defendants.
_____________________________/
ORDER
This matter is before the Court on Plaintiff’s Motion to Compel Responses to
Plaintiff’s Personal Jurisdiction Discovery (Doc. 60). On July 17, 2012 upon prior notice
the Court conducted a telephonic hearing to address the motion. For the reasons
discussed at the hearing, which are incorporated into this order, and as summarized
below, Plaintiff’s Motion to Compel is due to be granted in part and denied in part.
This case arises from a multi-million dollar loan in default. The defendants are
the borrower (a limited liability company), and a number of individuals who signed
limited guaranties of the loan. All of the individual defendants except one has filed a
motion to dismiss for lack of personal jurisdiction. (Docs. 38, 48, 49, 50, 51, 54.) The
one defendant who has not so filed has not responded to the suit at all. The moving
defendants argue that the Northern District of Florida has no personal jurisdiction over
them because their contacts to the state of Florida were limited to signing the
guaranties.
The parties jointly requested leave to conduct discovery on the issue of personal
jurisdiction, which the Court granted. (Doc. 47.) Plaintiff hoped to prove that
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Defendants had a greater relationship with the state of Florida than merely signing a
guaranty for the purchase of Florida property, and its discovery requests focused on
Defendants’ participation in the limited liability company that signed the loan in question
and the real estate development project that the loan was to fund. Defendants Stroud,
Wiles, and Graham responded to some requests, but lodged objections to many others.
Their objections fell generally into these categories: (1) the requests were impermissible
merits discovery; (2) the requests were impermissible financial discovery; (3) the
requests were otherwise outside the scope of the personal jurisdiction discovery
permitted by the Court; (4) the requests asked for information about other defendants.
In response to these objections, Plaintiff filed the instant motion to compel. (Doc. 60.)
After the motion was filed and before the hearing, Defendant Stroud filed a motion to
withdraw his previously-filed motion to dismiss, thereby consenting to personal
jurisdiction. (Doc. 72.) The motion to compel therefore remained pending only as to
Defendants Wiles and Graham.
As a general matter Defendants’ personal participation in the real estate
development project—or lack thereof—is relevant to the question of personal
jurisdiction, and discovery about that participation is permissible. Plaintiff’s motion to
compel answers to those requests is granted as detailed below. Second, many of
Plaintiff’s requests exceed the scope of personal jurisdiction discovery, encompassing
issues relevant only to the ultimate merits of the lawsuit and not Defendants’ personal
contacts with Florida. Those requests are limited or denied as detailed below. Finally,
a number of questions focused on the behavior of the limited liability company and on
other defendants, not on the behavior of Defendants Wiles and Graham. Because the
Case No: 5:11-cv-406-RS-GRJ
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motion to compel is pending only as to these two defendants, Plaintiff’s discovery
requests were limited or denied as detailed below.
Accordingly, upon due consideration, it is ORDERED:
(1) Plaintiff’s Motion to Compel (Doc. 60) is GRANTED in part and DENIED in
part. Defendant shall produce all responsive documents by August 3, 2012.
(2) With regard to Requests to Admit Nos. 1, 2, 6, 7, 8, 9, 10, 11, 25, 29, 35, 36,
and 37, the Motion to Compel is DENIED, and the Defendants’ objections are
sustained.
(3) With regard to Requests to Admit Nos. 3, 5, 19, 20, 21, 22, 34, and 50, the
Motion to Compel is GRANTED, and the Defendants’ objections are overruled.
(4) With regard to Request to Admit No. 33, the Motion to Compel is GRANTED,
with the limitation that the Defendants must answer as to themselves only.
(5) Requests to Admit Nos. 4, 23, and 24 are MOOT because Defendant Stroud
withdrew his objection to personal jurisdiction.
(6) The Motion to Compel does not apply to Requests to Admit Nos. 12, 13, 14,
15, 16, 17, 18, 26, 27, 28, 30, 31, 32, 41, 42, 43, 44, 45, 46, 47, 48, and 49.
(7) With regard to Requests to Admit Nos. 38, 39, and 40, Defendants’
objections are overruled so that Defendants’ response after the objections shall control.
(8) With regard to Interrogatory No. 1, the Motion to Compel is GRANTED in
part and DENIED in part. The Defendants must provide a response as to Wiles and
Graham only. Defendants shall not be required to respond to that part of the request
which states: “now or ever incorporated in, doing any business in, or deriving any
revenue from in [sic] the State of Florida” but shall be required to respond to the request
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as limited to “operating or doing business in Florida.” Defendants shall not be obligated
to provide information related to the last sentence of the request.
(9) With regard to Interrogatory No. 5, the Motion to Compel is GRANTED in
part and DENIED in part. The Interrogatory is limited to real and personal property
owned by Defendants Wiles and Graham. The Defendants must identify the property
and when they acquired it, but need not disclose its current value or its original cost.
(10) With regard to Interrogatory No. 13, the Motion to Compel is GRANTED in
part and DENIED in part. The Defendants must identify whether they have an interest
in GLS or any other business in Florida, including the name of that business, the nature
of the business, and what percentage ownership they have in the business. They need
not disclose financial information about the business such as revenues and profits.
(11) With regard to Interrogatory No. 14, the Motion to Compel is GRANTED.
The Defendants must provide a more complete answer to this interrogatory, including
whether the loan proceeds were actually used to operate a business or acquire
property.
(12) With regard to Interrogatory No. 15, the Motion to Compel is GRANTED to
the extent that Defendants must provide an amended response that describes the
circumstances surrounding their execution of the guarantees.
(13) With regard to Interrogatory No. 16, the Motion to Compel is GRANTED in
part and DENIED in part. The Defendants shall only be required to respond to the
interrogatory to the extent it requires the Defendants to describe their involvement, if
any, with the financing, marketing, and planning for development and sale of the Marina
Di Massa project, or its equivalent under another name.
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(14) With regard to Interrogatory No. 23, the Motion to Compel is GRANTED in
part and DENIED in part. The Defendants must respond to the interrogatory with
respect to Defendant Wiles, limited to the time frame June 2005 to the present.
(15) With regard to Interrogatories Nos. 6, 17, and 19, Defendants’ objections
are overruled and Defendants’ responses after the objections shall control.
(16) The Motion to Compel does not apply to Interrogatories Nos. 7, 8, 10, 21,
22, 24, and 25.
(17) With regard to Interrogatories Nos. 2, 4, 9, 11, 12, and 20, the Motion to
Compel is DENIED and the Defendants’ objections are sustained.
(18) With regard to Interrogatories Nos. 3 and 18, the Motion to Compel is
GRANTED and the Defendants’ objections are overruled.
(19) With regard to Plaintiff’s Motion to Compel responses to the Supplemental
Interrogatories the motion is DENIED because Plaintiff’s supplemental interrogatories
exceed twenty-five and the interrogatories do not request information directed to
personal jurisdiction.
(20) With regard to Request to Produce No. 1, the Motion to Compel is
GRANTED in part and DENIED in part, in accordance with the rulings above.
(21) With regard to Requests to Produce Nos. 2, 3, and 4, the Motion to Compel
is DENIED. The Defendants, however, shall be required to provide to Plaintiff copies of
any documents that they will use at a hearing in this case concerning personal
jurisdiction within three (3) days of the hearing.
(22) With regard to Request to Produce No. 5, the Motion to Compel is DENIED
and the Defendants’ objections are sustained. The Defendants, however, must
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describe any financial contributions they made to GLS or to FL Florida Property 3 LLC.
(23) With regard to Request to Produce No. 6, the Motion to Compel is DENIED
and the Defendants’ objections are sustained. However, the Defendants must
describe, to the extent that the Marina Di Massa project is not included in the
disclosures from Request to Produce No. 5, what contributions they made to that
project.
(24) With regard to Requests to Produce No. 9 and 22, the Motion to Compel is
GRANTED in part and DENIED in part. The Defendants’ objections are overruled.
Defendants must amend their responses as limited to the question of personal
jurisdiction.
(25) With regard to Request to Produce No. 14, the Motion to Compel is
GRANTED to the extent that the Plaintiff is asking for documents evincing an ownership
interest in GLS. Otherwise, the Motion to Compel is DENIED and the Defendants’
objections are sustained.
(26) With regard to Request to Produce No. 15, the Motion to Compel is
GRANTED to the extent that the request is limited to documents evidencing the
account agreement or evidencing the signature authority of the Defendants on any such
accounts.
(27) With regard to Request to Produce No. 16, the Motion to Compel is
GRANTED to the extent that the request is limited to Defendants Wiles and Graham,
and limited to documents actually in the Defendants’ possession.
(28) With regard to Request to Produce No. 20, the Motion to Compel is
GRANTED to the extent that the request is limited to information concerning property of
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GLS in the state of Florida.
(29) With regard to Request to Produce No. 21, the Motion to Compel is
GRANTED to the extent that the request is limited to the time frame 2004 to the
present, and limited to visits to the State of Florida by the Defendants that had a
business purpose.
(30) The Motion to Compel does not apply to Request to Produce No. 23.
(31) With regard to Requests to Produce Nos. 7, 8, 10, 11, 12, 13, and 17, the
Motion to Compel is DENIED and the Defendants’ objections are sustained.
(32) With regard to Requests to Produce Nos. 18 and 19, the Motion to Compel
is GRANTED and the Defendants’ objections are overruled.
(33) The Plaintiff’s Motion for Attorney’s Fees and the Defendants’ Motion for
Attorney’s Fees are DENIED because the Court concludes that the legal arguments
and positions of the parties were substantially jusitified.
DONE AND ORDERED this 17th day of July, 2012.
s/ Gary R. Jones s/GaryR.Jone
GARY R. JONES
United States Magistrate Judge
Case No: 5:11-cv-406-RS-GRJ
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