Chopra, M.D. et al v. Physicians Medical Center, LLC et al
ORDER granting 36 Plaintiffs' Motion to Compel; denying 40 Defendants' Motion for Sanctions. Signed by District Judge Robert H. Cleland. (LWag)
UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF MICHIGAN
VARUN CHOPRA, et al.,
Case No. 16-13915
PHYSICIANS MEDICAL CENTER, LLC, et al.,
ORDER GRANTING PLAINTIFFS’ MOTION TO COMPEL AND DENYING
DEFENDANTS’ MOTION FOR SANCTIONS
Pending before the court is Plaintiffs’ Motion to Compel Discovery and for
Sanctions. (Dkt. #36.) Defendants have filed a response, (Dkt. #37), and Plaintiffs have
filed their reply, (Dkt. #38). Also pending before the court is Defendants’ Motion for
Sanctions. (Dkt. #40.) This court held a hearing on both motions on May 9, 2017. For
the following reasons, the court will grant Plaintiffs’ motion to compel and deny
The instant case involves allegations that one of the Plaintiffs was admitted to
Defendants’ hospital residency program on the condition that his parents, also Plaintiffs,
make a sizeable donation to the hospital. They allege that not long after they made their
donations, the hospital ejected their son from the residency program and refused to
return any of the donated money. Defendants argue that Plaintiff left the residency
program willingly, and that the donation was made separately without any
understanding that it would guarantee the Plaintiff a spot in the residency program.
The parties have struggled to conduct discovery in this case, resulting in several
status conferences and direction by the court to conduct depositions on certain dates.
Prior to the filing of either of the instant motions, the court issued an order detailing the
history of the discovery issues and offering guidance on applicable law in the hopes that
the parties might resolve their dispute informally. (Dkt. #35.) The following day, Plaintiffs
filed their motion to compel.
Plaintiffs now allege that Defendants have refused to produce their three
deponents despite having earlier agreed to do so. They argue that Defendants’ decision
to inform Plaintiffs of this fact for the first time on the morning of the scheduled
depositions resulted in wasted attorney time and expenses, which the court should
award as a sanction under Federal Rule of Civil Procedure 37. They also allege that
Defendants have failed to provide substantive responses to formal discovery requests
despite their earlier agreements.
Defendants respond that their decision to cancel the depositions was not done in
bad faith, but instead was a response to the realization that Plaintiffs might pursue steps
to initiate a criminal action against Defendants. They argue that they first became aware
of this possibility during the deposition of one of the Plaintiffs the day prior, and they
needed time to research the applicability of Fifth Amendment privileges to sufficiently
advise their clients during the next day’s deposition consistent with their ethical
obligations of competence. Counsel argues that they also reached out to Plaintiffs prior
to the filing of the instant motion to propose new dates for the remaining depositions to
commence. Plaintiffs were not receptive to this suggestion.
In reply, Plaintiffs argue that the court should not reward Defendants’
gamesmanship with extra time to prepare for a deposition. Moreover, they argue that
Defendants completely failed to respond to their arguments regarding the responses to
written discovery which remain outstanding.
After briefing on Plaintiffs’ motion concluded, Defendants filed their own motion
for sanctions under Federal Rule of Civil Procedure 11, alleging various misstatements
or mischaracterizations of law and fact contained across a number of Plaintiffs’
pleadings and calling for attorney’s fees and costs incurred in responding.
A. Rule 37
“The scope of discovery under the Federal Rules of Civil Procedure is
traditionally quite broad.” Lewis v. ACB Bus. Servs., 135 F.3d 389, 402 (6th Cir. 1998).
“Parties may obtain discovery regarding any nonprivileged matter that is relevant to any
party's claim or defense and proportional to the needs of the case[.]” Fed. R. Civ. P.
26(b)(1). “Relevant evidence” is evidence that “has any tendency to make a fact more or
less probable than it would be without the evidence” where “the fact is of consequence
in determining the action.” Fed. R. Evid. 401. Information need not be admissible in
evidence to be discoverable. Fed. R. Civ. P. 26(b)(1). “However, district courts have
discretion to limit the scope of discovery where the information sought is overly broad or
would prove unduly burdensome to produce.” Surles ex rel. Johnson v. Greyhound
Lines, Inc., 474 F.3d 288, 305 (6th Cir. 2007).
Rules 33 and 34 allow a party to serve interrogatories and requests for
production of documents on an opposing party. Fed. R. Civ. P. 33, 34. A respondent
has thirty days to respond with answers or objections. Fed. R. Civ. P. 33(b)(2),
34(b)(2)(A). Where a party fails to respond to these requests properly, Federal Rule 37
allows the requesting party to file a motion to compel. Fed. R. Civ. P. 37(a)(3)(B). “If a
court grants a Rule 37 motion to compel, or if discovery is received after a Rule 37
motion is filed, then the court must award reasonable expenses and attorney's fees to
the successful party, unless the successful party did not confer in good faith before the
motion, the opposing party's position was substantially justified, or other circumstances
would make an award unjust.” Jessica Frye, v. CSX Transportation, Inc., et al., No.
14-11996, 2016 WL 2758268, at *1 (E.D. Mich. May 12, 2016) (citing Fed. R. Civ. P.
B. Rule 11
Pursuant to Rule 11, an attorney's signature on a pleading certifies that, to the
best of the attorney's knowledge, information, and belief, formed after a reasonable
(1) [the document] is not being presented for any improper purpose, such
as to harass, cause unnecessary delay, or needlessly increase the cost of
(2) the claims, defenses, and other legal contentions are warranted by
existing law or by a nonfrivolous argument for extending, modifying, or
reversing existing law or for establishing new law;
(3) the factual contentions have evidentiary support or, if specifically so
identified, will likely have evidentiary support after a reasonable
opportunity for further investigation or discovery; and
(4) the denials of factual contentions are warranted on the evidence or, if
specifically so identified, are reasonably based on belief or a lack of
Fed. R. Civ. P. 11. Rule 11 requires an attorney who has signed a pleading to fulfill
three obligations. Jackson v. Law Firm of O'Hara, Ruberg, Osborne and Taylor, 875
F.2d 1224, 1229 (6th Cir. 1989).
First, the attorney must conduct a reasonable inquiry to determine that the
document is well grounded in fact. Second, the attorney must conduct a reasonable
inquiry to determine that the positions taken are warranted by existing law or as good
faith arguments for extension or modification of existing law. Third, the document must
not be filed for any improper purpose. Id.
“The court judges the attorney’s conduct by ‘an objective standard of
reasonableness under the circumstances.’” Id. (quoting INVST Fin. Grp. Inc. v.
Chem–Nuclear Sys., Inc., 815 F.2d 391, 401 (6th Cir. 1987)). There is no good-faith
defense to Rule 11 sanctions because these obligations imposed by Rule 11 require
more than mere good-faith litigation. Id. Rule 11 imposes a “continuing duty of candor”
on litigants, authorizing sanctions for the continued pursuit of unsupportable claims.
Ridder v. City of Springfield, 109 F.3d 288, 293 (6th Cir.1997).
Sanctions for a Rule 11 violation are discretionary. Rentz v. Dynasty Apparel
Indus., Inc., 556 F.3d 389, 395 (6th Cir. 2009). The primary purpose of a Rule 11
sanction is deterrence rather than compensation. Ridder, 109 F.3d at 294. Any Rule 11
sanction “must be limited to what suffices to deter repetition of the conduct or
comparable conduct by others similarly situated.” Fed. R. Civ. P. 11(c)(4). While the
amended Rule 11 de-emphasizes monetary sanctions and direct payouts, it also
recognizes that “if imposed on motion and warranted for effective deterrence,” sanctions
may include “an order directing payment to the movant of part or all of the reasonable
attorney's fees and other expenses directly resulting from the violation.” Fed. R. Civ. P.
11(c)(4). Parties may be sanctioned under Rule 11, as representation by counsel does
not immunize a party from all Rule 11 sanctions. Fed. R. Civ. P. 11(c)(1); Golden v.
Spring Hill Assocs., No. 93–2186, 1994 WL 592946, at *2 (6th Cir. Oct. 26, 1994) (per
curiam). However, when sanctions are issued due to a frivolous legal position, only
attorneys may be held liable. Fed. R. Civ. P. 11(c) (5)(A); Dearborn St. Bldg. Assocs. v.
Huntington Nat'l Bank, 411 F. App’x 847, 852 (6th Cir. 2011).
Defendants do not argue that Plaintiff failed to comply with the meet-and-confer
requirement prior to bringing the instant motion (See Dkt. #44), nor do Defendants
contest that the written discovery responses Plaintiff identified as outstanding are validly
owing. At the hearing, counsel for both parties indicated that Defendants agreed to
provide substantive responses to the outstanding written discovery by Friday, May 12,
2017. The court is appreciative of counsel’s willingness to reach an agreement on this
issue, and it will order Defendants to comply with that deadline.
Defendants’ arguments regarding their decision to cancel the depositions on
short notice carry little weight. At the hearing, counsel for Defendants indicated that
Plaintiffs’ suggestion during deposition that they were considering pursuing avenues of
criminal prosecution arrived “out of the blue.” This characterization is simply not
consonant with reality. The complaint, filed in early November of 2016, alleges claims
under theories of breach of contract, fraud in the inducement, and civil conspiracy. (Dkt.
#1.) A proposed amended complaint, filed at the end of January of 2017 added common
law and statutory conversion claims. (Dkt. #25-2.) Defendants had notice, long before
the morning of March 30, 2017, that they would need to competently defend their clients
in civil discovery against the potential for charges related to fraud, at the very least.
Defendants’ decision cannot be viewed as anything other than strategic. Perhaps
the time spent reviewing Fifth Amendment principles will pay off for Defendants in the
long-run, but they are not free to do so on their own schedule at Plaintiffs’ expense. At
the hearing, counsel for Plaintiffs indicated that he would prefer to complete these
depositions on Tuesday May 16, 2017, starting at 8:30 a.m. at Defense counsel’s
office. Counsel for Defendants indicated that they were able to comply with this
request. Thus, the court will order Defendants to make Carol Samson, Dr. Nick
Hemady, and Priyam Sharma available for deposition at that time and location. Plaintiffs
requested that the deposition of Priyam Sharma occur first, and the court will order the
Federal Rule of Civil Procedure 37(d), titled “Party’s Failure to Attend its Own
Deposition . . .” requires that the court award sanctions, where, as here, the failure is
not substantially justified:
Sanctions may include any of the orders listed in Rule 37(b)(2)(A)(i)—(vi).
Instead of or in addition to these sanctions, the court must require the
party failing to act, the attorney advising that party, or both to pay the
reasonable expenses, including attorney’s fees, caused by the failure,
unless the failure was substantially justified or other circumstances make
an award of expenses unjust.
Fed. R. Civ. P. 37(d)(3). Thus, the court will order counsel for Defendants to pay the
costs, including time, that Plaintiffs incurred in travel, lodging, and food in anticipation of
the cancelled depositions. However, the court will not award sanctions for general
deposition preparation time, which, for the most part, would have been incurred in any
case and at this stage has not been entirely wasted.
Additionally, the court will award the costs and attorney’s fees Plaintiffs incurred
in filing the instant motion. The court is not currently in a position to define the amount of
this sanction, because Plaintiffs have not described these expenses with sufficient
detail. The court directs Plaintiffs to submit a supplemental memorandum identifying the
costs and fees with substantive time entry descriptions so that the court can assess
Defendants’ motion under Federal Rule of Civil Procedure 11, however, can not
succeed at this stage. Defendant’s brief alleges that he telephoned counsel for Plaintiffs
on Friday, April 28, 2017, at 3:40 p.m. to request concurrence, which was denied. (Dkt.
#40, Pg. ID 657.) The following Monday, Defendants filed their instant motion with the
court. Nothing in Defendants’ filing indicates that they have complied with the 21 day
“safe harbor” provision. When confronted by the court with this problem at the hearing,
counsel for Defendants argued that they had filed the motion to allow Plaintiffs 21 days
thereafter to come into compliance. The plain text of the rule describes exactly what
counsel is expected to do, and it does not involve filing a motion in the first instance:
A motion for sanctions must be made separately from any other motion
and must describe the specific conduct that allegedly violates Rule 11(b).
The motion must be served under Rule 5, but it must not be filed or
be presented to the court if the challenged paper, claim, defense,
contention, or denial is withdrawn or appropriately corrected within
21 days after service or within another time the court sets. If
warranted, the court may award to the prevailing party the reasonable
expenses, including attorney's fees, incurred for the motion.
Fed. R. Civ. P. 11(c)(2) (emphasis added); see also Fed. R. Civ P. 11 advisory
committee’s note to 1993 amendment (“The motion for sanctions is not, however, to be
filed until at least 21 days (or such other period as the court may set) after being
The court will deny Defendants’ motion for sanctions because they have not yet
afforded Plaintiffs access to the required “safe harbor.” In the interest of avoiding
unnecessary multiplication of briefings, the court will also take this opportunity to advise
Defendants that, should they consider refiling a similar motion after complying with the
“safe harbor” provision, they should be certain that the motion is warranted and has not
itself been presented to “harass, cause unnecessary delay, or needlessly increase the
cost of litigation.” Fed. R. Civ. P. 11(b)(1). As Plaintiff has not filed a formal response,
the court will not award Plaintiff any fees or expenses incurred related to this motion.
IT IS ORDERED that Plaintiffs’ Motion to Compel and for Sanctions (Dkt. #36) is
GRANTED. Defendants shall serve supplemental responses to written discovery before
the end of the day on May 12, 2017. The deposition of Priyam Sharma shall begin on
May 16, 2017, at 8:30 a.m. at Defense counsel’s office. The depositions of Carol
Samson and Dr. Nick Hemady will follow on the same day and at the same location.
IT IS FURTHER ORDERED that Plaintiffs shall file with the court a supplemental
memorandum outlining the expenses and fees sought for the courts’ consideration.
IT IS FURTHER ORDERED that Defendants’ Motion for Sanctions (Dkt. #40) is
s/Robert H. Cleland
ROBERT H. CLELAND
UNITED STATES DISTRICT JUDGE
Dated: May 9, 2017
I hereby certify that a copy of the foregoing document was mailed to counsel of record
on this date, May 9, 2017, by electronic and/or ordinary mail.
Case Manager and Deputy Clerk
S:\Cleland\JUDGE'S DESK\C2 ORDERS\16-13915.CHOPRA.GRANTCOMPEL.bss.wpd
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