CX Reinsurance Company Limited v. Kirson

Filing 125

ORDER denying 112 Defendant Devon S. Johnson's Motion for Reconsideration. Signed by Magistrate Judge Stephanie A Gallagher on 3/27/2018. (bmhs, Deputy Clerk)

UNITED STATES DISTRICT COURT
DISTRICT OF MARYLAND
CHAMBERS OF
STEPHANIE A. GALLAGHER
UNITED STATES MAGISTRATE JUDGE

101 WEST LOMBARD STREET
BALTIMORE, MARYLAND 21201
[phone]
Fax [phone]

March 27, 2018
LETTER TO COUNSEL
RE:

CX Reinsurance Company Limited, f/k/a CNA Reinsurance Company Limited v.
Devon S. Johnson; Civil Case No. RWT-15-3132

Dear Counsel:
Presently pending is Defendant Devon S. Johnson’s (“Johnson”) Motion for
Reconsideration [ECF No. 112] of my January 19, 2018 Letter Order (“Order”) [ECF No. 104]
adjudicating Johnson’s motion to compel responses to his document production requests [ECF
No. 89]. The Motion has been fully briefed. [ECF Nos. 112, 123, 124]. For the reasons set
forth below, Johnson’s Motion is DENIED, although the scope of my Order is clarified herein.
The issue presented is not actually one of reconsideration, but one of interpretation of my
Order. In the Order, I directed that CX Re produce “documents in its or Pro UK’s possession
relating to, or alleging, deleterious lead paint conditions at Kirson-insured properties prior to
August 1, 1997.” [ECF No. 104 at 5]. It is worth noting that the relief granted in the Order
precisely tracks the request made by Johnson in the relevant sections of his motion to compel.1
See, e.g., [ECF No. 89 at 7] (stating in the heading, “CX Re must produce Lead Paint Notice
Documents in its and Pro UK’s possession because such documents support Johnson’s laches
and waiver defenses . . . .”); id. (“CXRe refuses to produce documents in its and Pro UK’s
possession . . . .”); id. at 5 (“CXRe will not produce documents in Pro UK’s or CXRe’s
possession . . . .”). Elsewhere, in his motion to compel, Johnson unsuccessfully argued that CX
Re should produce responsive documents from Pro IS because Pro IS’s own knowledge of the
lead paint conditions was relevant and would impute actual knowledge to CX Re. See id. at 1622. Now, instead of arguing that Pro IS’s knowledge is imputed to CX Re, Johnson’s current
theory is that Pro IS may possess documents which establish actual knowledge on the part of Pro
UK, and that, because Pro IS is an agent of CX Re, such documents fall within CX Re’s
Johnson’s sporadic use of the phrase “and its agents” in his reply memorandum did not effectively
clarify that his request was broader than that set forth in the heading of his Motion to Compel. See [ECF
No. 112 at 2] (“In his Reply, Johnson again made clear that he sought all ‘documents and any other
information in the possession of CXRe or its agents relating to . . . dangerous lead paint conditions [at
Kirson Properties] during the period from 1997-1999.’”) (quoting [ECF No. 99 at 1]). In now contending
that the Order was “too narrow,” Johnson appears to have expected a ruling on an issue that simply was
not raised in any discernable fashion. See Walker v. Prince George's Cty., MD, 575 F.3d 426, 429 n.1
(4th Cir. 2009) (“Judges are not like pigs, hunting for truffles buried in briefs.”) (quoting United States v.
Dunkel, 927 F.2d 955, 956 (7th Cir. 1991)).
1

CX Reinsurance Co. Ltd., f/k/a CNA Reinsurance Co. Ltd. v. Johnson;
Civil Case No. RWT-15-3132
March 27, 2018
Page 2
possession, custody, or control. Compare [ECF No. 89 at 16-22], with [ECF No. 112].
Importantly, my Order did not intentionally limit the scope of production required by
Rule 34, which includes responsive documents in CX Re’s possession, custody, or control.
Because the Order mirrored the language used in Johnson’s motion to compel, however, Johnson
and CX Re have developed separate interpretations as to its scope. Johnson apparently
understood his request, and the ensuing order, to encompass documents within CX Re’s
possession, custody, or control, while CX Re interpreted the request more literally to exclude
“custody or control.” In granting the original Order, I did not consider or reach any conclusion
about whether documents in the “custody or control” of CX Re (or Pro UK) should be excluded
from the requested production. Upon now considering the question, I see no reason to restrict
the customary scope of Rule 34. Any documents demonstrating Pro UK’s knowledge of lead
paint conditions at Kirson-insured properties prior to August 1, 1997, whether in the possession
of CX Re or merely in its “custody or control,” would be relevant to Johnson’s laches defense.
The next issue, then, is whether documents evidencing Pro UK’s knowledge that are in
Pro IS’s possession are within the “custody or control” of CX Re. The documents are within CX
Re’s “control” if it has the “practical ability” to obtain them from Pro IS. See Benisek v.
Lamone, 320 F.R.D. 32, 34 (D. Md. 2017) (stating that Fed. R. Civ. P. 34 requires a party to
produce relevant documents that are within its “possession, custody, or control” and that
documents are within a party’s control if it “has the practical ability to obtain the documents
from another, irrespective of [its] legal entitlement to the documents.”) (citation and internal
quotation marks omitted). In determining whether a corporation has control over documents in
the possession of another corporation, courts look to factors, including: “(a) commonality of
ownership, (b) exchange or intermingling of directors, officers or employees of the two
corporations, (c) exchange of documents between the corporations in the ordinary course of
business, (d) any benefit or involvement by the non-party corporation in the transaction, and (e)
involvement of the non-party corporation in the litigation.” Uniden Am. Corp. v. Ericsson Inc.,
181 F.R.D. 302, 306 (M.D.N.C. 1998); see also Steele Software Sys., Corp. v. DataQuick Info.
Sys., Inc., 237 F.R.D. 561, 564-65 (D. Md. 2006). Importantly, as the party seeking the
production of documents from a nonparty, Johnson has the burden of proof and “must provide
specific facts demonstrating that some or all of the foregoing factors of control are present.”
Steele Software Sys., Corp., 237 F.R.D. at 565.
Here, however, CX Re appears to concede that it has the “practical ability” to obtain the
requested Pro IS documents. In its Opposition, it stated:
CX Re would first need to ask Pro IS to assemble and send to CX Re all of the
Kirson-related documents . . . . Once CX Re received such documents, its
attorneys would then have to analyze them for relevance and privilege. CX Re
anticipates that obtaining these documents and preparing them for production
would take at least one month.
[ECF No. 123 at 12]. Though acknowledging that it can produce the documents, CX Re argues

CX Reinsurance Co. Ltd., f/k/a CNA Reinsurance Co. Ltd. v. Johnson;
Civil Case No. RWT-15-3132
March 27, 2018
Page 3
that, if ordered to do so, it would incur an undue burden. See id. (arguing that “the burden on CX
Re of searching for the documents Johnson seeks far outweighs the (non-existent) benefit of
those documents to Johnson.”). I am not persuaded, however, that CX Re has established undue
burden. See Innovative Therapies, Inc. v. Meents, 302 F.R.D. 364, 377 (D. Md. 2014) (“The
court may restrict the scope of a production request . . . . The burden is on the movant to
establish good cause . . . the movant must set forth specific and particular facts, rather than broad
conclusory statements as to why a protective order should issue.”) (internal quotation marks and
citations omitted). CX Re has not proffered the number of records that would need to be
searched, reviewed, or produced, or the costs associated therewith. After Pro IS provides CX Re
with its documents evidencing Pro UK’s knowledge of lead paint conditions at Kirson-insured
properties prior to August 1, 1997, if the quantity produced is significant, CX Re will be
permitted to renew its argument that analyzing those documents for relevance and privilege will
cause it to incur an “undue burden.”
Accordingly, while Johnson’s Motion for Reconsideration is DENIED [ECF No. 112],
my January 19, 2018 Letter Order [ECF No. 104] should be read to require production of
responsive documents in the possession, custody, or control of CX Re or Pro UK. CX Re must
produce any additional responsive documents within thirty days of this Letter Order. No other
deadlines in this case will be modified as a result. Despite the informal nature of this letter, it
will be flagged as an Opinion and docketed as an Order.
Sincerely yours,
/s/
Stephanie A. Gallagher
United States Magistrate Judge
cc: Judge Roger W. Titus