Dealer Computer Services, Inc. v. Griffith
MEMORANDUM AND ORDER granting in part 53 Plaintiff's Motion to Compel. See order for details. Signed by Magistrate Judge Karen M. Humphreys on 8/3/2012. (sj)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF KANSAS
DEALER COMPUTER SERVICES, INC.,
f/k/a FORD DEALER COMPUTER
Case No. 11-2305-JWL
MEMORANDUM AND ORDER
This matter is before the court on plaintiff’s motion to compel defendant to produce
documents responsive to plaintiff’s first set of production requests and for sanctions. (Doc.
53).1 For the reasons set forth below, plaintiff’s motion shall be GRANTED IN PART.
Highly summarized, Dealer Computer Services (DCS) alleges that Mr. Griffith
orchestrated a transfer of assets in violation of the Kansas Uniform Fraudulent Transfer Act
Although the first sentence of plaintiff’s motion states that interrogatory answers
should also be compelled, the parties’ briefs focus on issues concerning document
production and the court fails to identify any arguments concerning disputed
interrogatories. The court deems any issue concerning the sufficiency of defendant’s
interrogatory answers to have been abandoned.
(KUFTA) to prevent DCS from collecting debts owed under two service contracts between
DCS and Griffith Ford-Mercury, Inc. (GFMI), an Iowa automobile dealership formerly
owned by Mr. Griffith. In a nutshell, DCS alleges that Mr. Griffith sold the assets of the
corporation to a purchaser for a nominal amount and entered into a side agreement to be paid
in excess of $45,000 per year for ten years under the guise of “an employment contract.”
Motion to Compel
Plaintiff served defendant with 54 requests for the production of documents and
defendant asserted some form of objection to every request. Plaintiff moves to compel,
arguing that defendant’s “boilerplate objections” are without merit and that production
should be ordered. In response to the motion, defendant now argues:
notwithstanding the objections raised by defendant to the discovery
requests [in] this matter, defendant has provided all records in his
possession, save for those in two categories relevant to these
discovery requests and this dispute:
a. documents protected by the attorney-client privilege or
attorney work-product doctrine; and
b. personal financial documents of Roland Griffith.
Defendant’s Response, Doc. 68, p. 3, (emphasis added). Defendant then discusses the
objections concerning his personal financial documents and privilege assertions. The issues
are addressed in greater detail below.
Objections and Representations Concerning Document Production
Plaintiff’s motion to compel discusses defendant’s lengthy list of boilerplate
objections to Production Requests 3-39, 41-47 and 54 and explains why the objections have
Rather than respond to those arguments, defendant now contends that,
“notwithstanding the objections,” he has produced all documents in his possession. It is
improper to assert boilerplate objections to discovery requests when there are no documents
responsive to the requests. Under Fed. R. Civ. P. 26(g) an attorney signing a discovery
response certifies that any objection is 1) consistent with rules, 2) not interposed to cause
unnecessary delay or expense, and 3) not unreasonably burdensome or expensive. If all
documents had been produced, defendant should have timely supplemented his discovery
responses before the motion to compel was filed and 1) unequivocally advised opposing
counsel that there were no additional documents responsive to certain production requests
and 2) withdrawn his boiler-plate objections to those production requests.2
In addition to the above problem, defendant has misquoted his duty to produce
documents. Although defendant represents that he has produced all documents in his
“possession,” Fed. R. Civ. P. 34 requires production of documents in his “possession,
custody, or control.” To establish a clear record of defendant’s discovery responses,
Defendant’s reasons for asserting objections while at the same time claiming that
all documents have been produced are not entirely clear. During a July 31, 2012 status
conference defense counsel asserted that he was attempting to preserve defendant’s
objections under some unspecified Missouri case law. No citations were provided and it
is doubtful that any court would concern itself with hypothetical objections when no
additional documents exist for production.
defendant shall serve supplemental responses signed by defendant under oath stating that
he has produced all documents responsive to production requests 3-32, 34-35, 39, and 41-47.
Because defendant represents that all documents have been produced, no objections may be
cited except for those instances where defendant previously asserted the attorney-client
privilege or work product doctrine. Defendant’s supplemental response shall be served on
plaintiff before August 13, 2012.
Attorney-Client Privilege and Work Product Doctrine
Defendant prepared a privilege log to support his objection that certain documents are
protected by the attorney-client privilege.3 Plaintiff challenges the sufficiency of the
privilege log and, to expedite resolution of the privilege dispute, the court has reviewed the
36 documents in camera.
The documents identified as RG000212-13, RG000217,
RG000219 and RG000280-83 are not protected by the attorney-client privilege because the
documents were created by non-parties and were not created for the purpose of
communicating legal advice. For example, RG000212-13 is a two-page order by a state
judge concerning a case in Iowa. This public document is not transformed into a privileged
document merely because defendant’s attorney sent a copy of the ruling to defendant.
Accordingly, defendant shall produce the above listed documents by August 13, 2012. The
Although defendant asserted the work product doctrine in response to certain
production requests, his privilege log does not list any documents as protected by the
work product doctrine.
remaining documents are either protected by the attorney-client privilege or are so
insignificant that production is not warranted.4
Although not supported by a privilege log, defendant also asserted the work product
doctrine in response to Production Request 54. Request 54 asks for all documents that
support defendant’s defenses. Fed. R. Civ. P. 26(a)(1)(A)(ii) requires a party to identify and
produce all documents in defendant’s possession, custody, or control that may be used to
support a defense. Defendant’s assertion that such documents are protected from disclosure
by the work product doctrine is without merit and summarily rejected. Defendant shall
produce all documents responsive to Production Request 54 by August 13, 2012.
Finally, defendant asserts that his general objection based on the attorney-client
privilege is necessary to preserve the objection “in the unlikely event additional privileged
documents are discovered.” Again, it is not appropriate to assert an objection concerning
documents that do not exist and this argument is rejected.
Production Requests 33, 36-38
Production Request No. 33 seeks documents, including bank statements and canceled
checks, related to any payments made to defendant pursuant to the “employment agreement”
with the purchaser of defendant’s Iowa car dealership. This request for bank statements is
overly board and would include the production of financial information that is not related to
A number of the listed documents are simply transmittal coversheets.
plaintiff’s claims. Accordingly, the general request for monthly bank statements and
canceled checks is denied. However, defendant shall produce documents which show his
receipt of any payments from the purchasers of his dealership.
Production Request 36 asks for defendant’s federal tax returns and Request 37 asks
for defendant’s state tax returns. The returns are relevant to show whether defendant
recognized the payments as “employee compensation” and whether FICA taxes were paid.
Evidence that FICA taxes were not paid would support plaintiff’s contention that the
payments were not for employee services but rather as part of a plan to avoid GFMI’s
creditors. Because the tax returns contain relevant information, defendant carries the burden
of showing that the information is readily obtainable from other sources. Audiotext
Communications Network, Inc. v. US Telecom, Inc., 195 WL 625962 (D. Kan. 1995).
Defendant has not shown that the information is readily available from other sources;
therefore, the motion to compel production of the tax returns is GRANTED.
Production Request 38 seeks all financial statements prepared by defendant from 2003
to the present. The negotiations and sale that form the basis for plaintiff’s fraudulent
conveyance claims took place during the time from 2003 to 2004. Defendant’s financial
statements during this period are relevant to plaintiff’s fraudulent conveyance claim and shall
be produced by August 13, 2012. However, the request for more recent financial statements
appears to be an attempt to gather information for post-judgment collection activity and is
IT IS THEREFORE ORDERED that plaintiff’s motion (Doc. 53) is GRANTED
IN PART, consistent with the rulings herein. Sanctions will not be awarded at this time;
however, the issue of sanctions remains under advisement and may be revisited if defendant
fails to comply with the court’s rulings.
IT IS SO ORDERED.
Dated at Wichita, Kansas this 3rd day of August 2012.
S/ Karen M. Humphreys
KAREN M. HUMPHREYS
United States Magistrate Judge
Plaintiff argues that the more recent financial statements are relevant to support
their claim for punitive damages. Although there is some variance in this district, it
appears that Judge Lungstrum’s practice is to defer discovery of financial information
related to punitive damages until after trial. American Maplan Corporation v. Peter
Heilmayr, 203 F.R.D. 499 (D. Kan. 2001). Accordingly, discovery concerning financial
matters relevant to the amount of punitive damages shall be deferred until after trial.
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