Brannen v. First Citizens Bankshares Inc. Employee Stock Ownership Plan with 401(k) Provisions et al

Filing 72

ORDER directing the parties to submit their full 26f report within 10 days from the service date of this Order. ( Rule 26 Report due by 9/18/2016.) Signed by Magistrate Judge G. R. Smith on 9/7/16. (wwp)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF GEORGIA
STATE SBORO DIVISION
CARRIE BRANNEN,

)
)

Plaintiff,

Case No. CV615-030
FIRST CITIZENS BANKSHARES, INC.
EMPLOYEE STOCK OWNERSHIP PLAN
WITH 401(k) PROVISIONS et al.,
Defendants.

ORDER
The parties in this ERISA case filed an "Initial Rule 26(F) Report"
(more about that later) on July 14, 2016. Doe. 66. Among other things,
that report stated their proposal to stay discovery pending a ruling on
the defendants' motions to dismiss, with the representation that the
parties would then "promptly" conduct a second Rule 26(1) conference
and submit a "full" report containing their proposed discovery schedule.
Id. at 2.
The District Judge's Order addressing the motions to dismiss was
entered on August 26. 2016. Doe. 71 (granting in part and denying in
part defendants' motions). The Court has not heard from the parties

since that date. To ensure that the parties act with the promptitude
promised in their "Initial" report, the Court DIRECTS that they confer
and submit their "full" 26(f) report within 10 days from the service date
of this Order.
The parties' "Initial" Rule 26(f) Report is a strange document in
many ways. First, it was considerably untimely. The day the complaint
was filed (3/27/15), the Court entered its standard General Order
requiring the parties to conduct their Rule 26(f) conference "by the

earlier of 21 days after the filing of the last answer of the defendants
named in the original complaint or 45 days after the first appearance by
answer or motion under Fed. R. Civ. P. 12 of the defendants named in
the original complaint." Doc. 18.' The parties had an additional 14 days
to file their Rule 26(f) report. Id. Because the defendants appeared by
motion rather than by answer, they were required to hold their
scheduling conference on or before November 5, 2015, and to submit
their 26(f) report by November 19, 2015. The parties' "Initial" report
was not received until some 8 months after that deadline.

1

That Order merely reflected the deadlines (then) imposed by Local Rule 26.1(a).
Those rule-driven deadlines were changed by the Court in May 2016. See L. R.
26.1(a) (current version).
2

Eventually, "out of caution," the parties "decided" to comply with
the Court's General Order (and its Local Rules). In addition to being
untimely, that document did not "confor[m] to the language and format"
of the Court's standard form Rule 26(f) report, as directed by the March
27, 2015 General Order. Doe. 18. Not only that, the "Initial" report
represented that the parties had "agreed not to pursue discovery until a
resolution of the pending motions to dismiss." Doe. 66 at 1. Effectively,
the parties self-granted their own stay request.
Suffice it to say that neither the federal rules, the local rules, nor
any Court custom or practice allows litigants to decide, on their own,
whether or when to commence discovery in a civil case, much less when
to submit the report required by Rule 26. Indeed, the federal rules

mandate that the Court enter its scheduling order "within the earlier of
90 days after any defendant has been served with the complaint or 60
days after any defendant has appeared" unless the Court "finds good
cause for delay." Fed. R. Civ. P. 16(b)(2) (effective Dec. 1, 2015). The
parties have never sought, nor has the Court ever made, such a "good
cause" finding. A timely-filed Rule 26(f) report serves as a trigger for the
Court to enter the scheduling order. Here, the Court overlooked the

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parties' default (their failure to submit a timely, rule-compliant 26(f)
report), resulting in a violation of Federal Rule 16.
The parties might be tempted to argue that this is a no-harm-nofoul situation, for even had they complied with the rules and this Court's
initial order, the Court would almost certainly have granted a stay of
discovery pending the determination of the motions to dismiss. In
addition to being beside the point (rules and orders are to be respected,
not ignored), it is by no means certain that the Court would have stayed

all discovery in this case pending the disposition of the motions to
dismiss. The filing of a motion to dismiss does not automatically result
in a stay of discovery. Instead, such a stay is warranted only where,
upon preliminary review of a dispositive motion, the Court finds it "to be
clearly meritorious and truly case dispositive, . . . rendering discovery a
mere futile exercise." S. Motors Chevrolet, Inc. v. General Motors, LLC,
2014 WL 5644089 at *1 (S.D. Ga. November 4, 2014) (citations and
internal quotes omitted). Without engaging in too much conjecture here,
it is very likely that, had the parties timely sought a stay of all discovery
in this case, the Court would have exercised its discretion to deny that
request, at least in part. Non-compliance with the rules, therefore, has

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not been without consequence, for that non-compliance has resulted in
delaying the progress of this case.
It is intriguing that the parties acted "out of caution" in submitting
their delinquent "Initial" 26(f) report. 2 That suggests that they realized,
though belatedly, their failure to do what the local rules required, and
what the Court ordered, them to do. It would have been better had their
caution prompted them to read and comply with the Court's General
Order in the Fall of 2015. Had they done so, the Court would have
timely entered its scheduling order, Rule 16 would not have been
violated, and this case would be further along toward its "just, speedy,
and inexpensive determination." Fed. R. Civ. P. 1. The Court expects
full compliance with its rules and orders during the remainder of this
case.
SO ORDERED, this 71day of September, 2016.

UNITED ST EMAG STRKTE JUDGE
SOUTHERN DISTRICT OF GEORGIA

2

The term "Initial" 26(f) report is a misnomer, for what they submitted is not a Rule
26W report at all but a motion for the Court to grant what they had already "agreed"
to grant to themselves - a lengthy stay of discovery.
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