LUSBY v. ROLLS-ROYCE CORPORATION
Filing
291
ORDER denying 264 Motion to Enforce the Court's Order of August 8, 2011. Signed by Magistrate Judge William G. Hussmann, Jr on 10/26/2011. (SMD)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF INDIANA
INDIANAPOLIS DIVISION
UNITED STATES OF AMERICA, ex rel.
CURTIS J. LUSBY,
Plaintiff,
v.
ROLLS-ROYCE CORPORATION,
Defendant.
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1:03-cv-680-SEB-WGH
ORDER DENYING MOTION TO ENFORCE THE
COURT’S ORDER OF AUGUST 8, 2011
This matter is before the Honorable William G. Hussmann, Jr., United
States Magistrate Judge, on Relator’s Motion to Enforce the Court’s Order of
August 8, 2011, filed September 28, 2011. (Docket Nos. 264-66). Defendant
filed its Opposition to Relator’s Motion to Enforce on October 17, 2011. (Docket
No. 284). Relator’s Reply was filed on October 25, 2011. (Docket No. 290).1
This is a qui tam suit in which Relator, Curtis Lusby, claims that
Defendant knowingly presented, or caused to be presented, to an officer or
employee of the United States Government false or fraudulent claims for
payment or approval in violation of 31 U.S.C. § 3729.
Docket No. 278 is a Response to Sealed Filings (Dkts. 264-266) filed by RollsRoyce in which the Defendant states there is no objection to the sealing of some
exhibits attached to this motion. Those exhibits shall remain sealed at this time.
1
Relator filed a Motion to Compel requesting that the court compel
Defendant to respond to certain discovery. The court issued an Order granting,
in part, and denying, in part, Relator’s Motion to Compel and specifying in which
areas of Relator’s discovery Defendant needed to provide additional responses.
(Docket No. 242). Defendant then served Supplemented Responses to Relator’s
discovery requests in accordance with the court’s Order. Relator now claims
that Defendant’s Supplemented Responses are inadequate and do not comply
with the court’s Order.
The Magistrate Judge, being duly advised, now finds as follows:
1. Modified First Request for Production No. 15: In the court’s August
8, 2011 Order, the Magistrate Judge determined that “Rolls-Royce shall specify
by Bates Stamp number all monthly MRB reports referenced in the QADI 800.”
Defendant, following the court’s August 8, 2011 Order, supplemented its
Response to Relator’s Modified First Request for Production No. 15 with the
following:
Rolls-Royce has produced reports or memoranda describing
aggregating monthly MRB data at Bates Nos. RR00033528RR00033566. These reports include monthly MRB report data as
set forth in QADI 800. Rolls-Royce believes that additional or
different reports reflecting the data set forth in QADI 800 were also
prepared during the discovery time period, but there was no
requirement or business need to retain such reports and Rolls-Royce
has not been able to locate additional responsive monthly MRB
reports from the discovery period (1994-2001). Rolls-Royce notes
further that it has previously produced the relevant MRB reports
(e.g., concessions and Technical Analysis Reports) that concern the
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parts at issue in this case; these reports would have been used to
generate monthly MRB data.
(Opposition to Relator’s Motion to Enforce at Ex. 1A, 12-13).
While Relator argues that Defendant’s Supplemented Response is nonresponsive because it alleges that the document that Defendant produced is not
an MRB Report, the Magistrate Judge concludes that Defendant has complied
with the court’s August 8, 2011 Order. Defendant produced what it alleges are
the only documents it has that are responsive to Relator’s Modified First Request
for Production No. 15. Furthermore, Defendant affirmed that such MRB Reports
did exist in the past but likely were not retained and have not been located. The
court’s August 8, 2011 Order did not require any more of Defendant than what it
has provided. The Magistrate Judge must point out, however, that Defendant
will be held to these assertions and will not be permitted to use at trial any MRB
Reports that were not produced in response to Relator’s Modified Request for
Production No. 15.
2. Modified First Request for Production No. 20: In the court’s August
8, 2011 Order, the Magistrate Judge determined that “Rolls-Royce is to produce
any additional [internal] audits which have not been produced during the years
1996 and 1997, or certify that none are in existence, within fifteen (15) days of
the date of this Order.”2
The Magistrate Judge modified the original Order to indicate that internal,
rather than customer, audits were to be produced. (Docket No. 250).
2
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After the court’s August 8, 2011 Order, Defendant supplemented its
Response to Relator’s Modified First Request for Production No. 20 as follows:
“With regard to ‘internal’ audits for the years 1996 and 1997, Rolls-Royce has
repeatedly searched for records of such audits and searched for them again in
response to Relator’s Motion to Compel. Rolls-Royce certifies that, despite
multiple diligent searches, it has not been able to locate any additional internal
audits.” (Opposition to Relator’s Motion to Enforce at Ex. 1B, 13).
Relator found fault in this Response because Defendant did not
specifically certify that no such internal audits exist or were in existence at the
time this lawsuit was filed. This Magistrate Judge concludes that Defendant’s
statement can be construed as a certification that no such internal audits exist,
and the Response, therefore, complied with the court’s August 8, 2011 Order.3
3. Modified First Request for Production No. 21: In the court’s August
8, 2011 Order, the Magistrate Judge determined that “Rolls-Royce shall provide
copies of the items listed in Exhibit B to Relator’s Reply (Docket No. 237) within
fifteen (15) days of the date of this Order, or answer an interrogatory establishing
why those documents do not currently exist or cannot be found.”
After the court’s August 8, 2011 Order, Defendant supplemented its
Response to Relator’s Modified First Request for Production No. 21. Defendant
The Magistrate Judge notes that Defendant will be held to its certification that
no internal audits exist, and will not be permitted to use any internal audits at trial if
they are later discovered. Furthermore, the issue of spoliation will have to be resolved
in the future.
3
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explained that it had produced all documents identified by Exhibit B that it
could locate. (See Opposition to Relator’s Motion to Enforce at Ex. 1B, 13).
Defendant also explained which documents it could not locate and why:
There are eleven audits listed on Relator’s Exhibit B; for clarity,
Rolls-Royce has included a copy of Relator’s Exhibit B with this
response with numbers (Nos. 1-11) added to the right of the first
column so that each audit can be identified precisely. All of the
documents produced with this interrogatory concern Exhibit B Nos.
1 and 6 (identified by Relator as Audit Nos. 99-027 and 00-002). It
is possible that Rolls-Royce received additional third-party audit
reports or Corrective Action Requests from these two audits;
however: (1) Rolls-Royce would not have received all of the
third-party reports generated during these audits and (2) after an
audit is complete and all outstanding issues are resolved there is no
requirement or business reason for Rolls-Royce to retain copies of
such documents. Indeed, Rolls-Royce’s retention policies have
provided at certain times that internal audits should be retained for
three years, but Rolls-Royce did not have a retention policy
applicable to third-party audits during the discovery period
(1994-2001). See, e.g., RR00018561 - RR00018563 (one of the
versions of QADI 130 produced to Relator in this lawsuit).
Consequently, although Rolls-Royce has conducted an additional
search for third party audit reports and Corrective Action Requests
that the auditor may have provided to Rolls-Royce regarding these
two audits, it has not been able to locate any such documents.
. . . . [Further], Rolls-Royce has no record that it received any
report or Corrective Action Request from the auditors who
conducted Nos. 2 and 3 (identified by Relator as Audit Nos. 99-029
and 99-030). With respect to the remaining seven third-party audits
(Nos. 4-5, 7-11), it is likely that Rolls-Royce did, at some point,
receive one or more reports or Corrective Action Requests
concerning these audits from the third-party auditors. As noted,
however, after an audit is complete and all outstanding issues are
resolved, there is no requirement or business reason for Rolls-Royce
to retain copies of such documents. Consequently, Rolls-Royce
believes that any documents that it received were discarded or
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destroyed in the ordinary course of business prior to the filing of this
lawsuit in 2003.
(Id. at 14-15 (emphasis in original)).
Relator claims that Defendant’s Supplemented Response is inadequate.
However, this Magistrate Judge concludes that Defendant did include additional
audits that it believed were responsive to the court’s August 8, 2011 Order and
explained why it was unable to locate those audits that were not produced.
While Relator disputes the accuracy of Defendant’s rationale for not being able to
produce some of the audits, Defendant has provided a reason why the audits “do
not currently exist or cannot be found.” Therefore, Defendant properly complied
with the court’s August 8, 2011 Order.
4. Modified First Interrogatories Nos. 11 and 12: In the court’s August
8, 2011 Order, the Magistrate Judge determined that “[t]he Motion to Compel is
DENIED, subject to Rolls-Royce providing a further definition of
“nonconforming” within fifteen (15) days of the date of this Order.” Relator
admits that Defendant did, in fact, provide a definition of “nonconforming,” but
finds fault in the substance of Defendant’s definition and argues that a new
term, “design intent,” is not defined. Despite Relator’s disagreement with
Defendant’s definition of “nonconforming,” the Magistrate Judge concludes that
Defendant did comply with the court’s August 8, 2011 Order.
5. Modified First Interrogatory No. 14: In the court’s August 8, 2011
Order, the Magistrate Judge determined that “[f]or those individuals named in
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the answer to Interrogatory No. 14, Rolls-Royce shall provide appropriate last
known address or contact information for those named individuals. To the
extent Rolls-Royce contends that those individuals are members of the control
group, they must designate which of the individuals must be contacted through
counsel.”
After the court’s August 8, 2011 Order, Defendant supplemented its
Response to Relator’s Modified First Interrogatory No. 14 by providing the last
known address or contact information of all individuals named in Interrogatory
No. 14. Furthermore, Defendant indicated that each of the identified individuals
were members of the “control group.” (Opposition to Relator’s Motion to Enforce
at Ex. 1A, 7-8).
Relator argues that Defendant’s Supplemented Response is inadequate
because it does not explain why each individual listed is part of the “control
group.” Relator also argues that Defendant should be ordered to include a
privilege log to the extent that Defendant asserts that members of the “control
group” are not to discuss privileged communications.
Despite Relator’s objections, the Magistrate Judge concludes that
Defendant has fully complied with the court’s August 8, 2011 Order. Of course,
Relator will have the opportunity upon deposing each of the identified
individuals to challenge whether or not they were properly identified as part of
the “control group” and to determine whether privileged communications were
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involved. But, requiring Defendant to defend its “control group” designations
was not a requirement of the court’s August 8, 2011 Order.
For these reasons, Relator’s Motion to Enforce the Court’s Order of August
8, 2011, is DENIED.
SO ORDERED.
__________________________
William G. Hussmann, Jr.
United States Magistrate Judge
Southern District of Indiana
Dated: October 26, 2011
Electronic copies to:
Jeff M. Barron
BARNES & THORNBURG LLP
jeff.barron@btlaw.com
Michael R. Brunelle
BARNES & THORNBURG LLP
mbrunelle@btlaw.com
Jill Z. Julian
UNITED STATES ATTORNEY’S OFFICE
jill.julian@usdoj.gov
Edward A. McConwell Sr.
MCCONWELL LAW OFFICES
ed@mcconwell.com
Koryn Michelle McHone
BARNES & THORNBURG LLP
kmchone@btlaw.com
Peter Abernethy Morse Jr
BARNES & THORNBURG LLP
pmorse@btlaw.com
-8-
Charles W. Ryan III
DOMBROFF GILMORE JAQUES & FRENCH, P.C.
cryan@dglitigators.com
Joseph Striewe
joestriewe@striewelaw.com
Richard P. Winegardner
BARNES & THORNBURG LLP
rwinegar@btlaw.com
Judy L. Woods
BENESCH, FRIEDLANDER, COPLAN & ARONOFF LLP
jwoods@beneschlaw.com
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