Nationwide Recovery, Incorporated v. Detroit, City of

Filing 199

OPINION AND ORDER DENYING CITY OF DETROIT'S 188 MOTION TO COMPEL Signed by District Judge Linda V. Parker. (AFla)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
NATIONWIDE RECOVERY, INC.,
JERRY PARKER, HUSSEIN M.
HUSSEIN, LOUAY M. HUSSEIN,
ANNIE HUSSEIN, JULIA HUSSEIN,
and CAROL HENDON,
Plaintiffs,

Civil Case No. 17-12378
Honorable Linda V. Parker

v.
CITY OF DETROIT,
Defendant.
__________________________________/
OPINION AND ORDER DENYING CITY OF DETROIT’S MOTION TO
COMPEL (ECF NO. 188)
This is a civil rights action in which the Court has found that Defendant City
of Detroit (“City”) violated the procedural due process rights of Plaintiff
Nationwide Recovery, Inc. (“Nationwide”) when the City suspended Nationwide’s
towing permit and removed it from the police department’s authorized towing list
without notice and a pre-deprivation hearing. (ECF No. 119.) The matter is
presently before the Court on the City’s motion to compel, in which the City seeks
evidence to undermine Nationwide’s claim for compensatory damages. (ECF No.
188.) The motion has been fully briefed. (ECF No. 189, 190.) Finding the facts

and arguments sufficiently presented in the parties’ briefs, the Court is dispensing
with oral argument pursuant to Eastern District of Michigan Local Rule 7.1(f).
Background
In the motion, the City initially sought to compel Nationwide’s responses to
its interrogatories 3 and 4, and documents requested in document requests 3, 4, 7,
and 8. (ECF No. 188 at Pg ID 6095.) Nationwide subsequently produced
documents in response to the City’s document requests 7 and 8 and informed the
City that it would also produce the documents requested in document request 3.
Thus, what remains in dispute are the City’s interrogatories 3 and 4:
3. Identify all governmental towing/storage contracts (or
subcontracts) that Nationwide has held since January 1, 2017
(except the DPD tow permit) and, for each, identify the
governmental entity and the date the contract/subcontract began
and the date it terminated or is set to terminate.
4. For each contract identified in response to interrogatory 3,
identify the individual at the governmental entity who oversees
Nationwide’s services including name, title, address and
telephone number.
(See ECF No. 188-2 at Pg ID 6127.) Also in dispute is the City’s request for “all
of Nationwide’s contracts or subcontracts for each of the governmental entities
identified in response to interrogatory 3.” (Id. at Pg ID 6130.)
The City maintains that this evidence is relevant to establish Nationwide’s
“pattern and practice[]” of charging “illegal and grossly excessive towing and
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storage charges.” (ECF No. 188 at Pg ID 6098.) The City further maintains that
such proof is admissible to preclude Nationwide from recovering compensatory
damages and to challenge its claimed lost profits as a result of the City’s
unconstitutional conduct.
In response, Nationwide first urges the Court to stay its ruling on the motion
until it decides what evidence will be admissible on the issue of Nationwide’s
damages.1 Nationwide next argues that the requested discovery is not relevant to
the remaining issue of damages.
Analysis
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). As Rule 26 provides:
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, considering the
importance of the issues at stake in the action, the amount in
controversy, the parties’ relative access to relevant information,
the parties’ resources, the importance of the discovery in
resolving the issues, and whether the burden or expense of the
proposed discovery outweighs its likely benefit.

1

The Court previously ordered supplemental briefing on several issues related to
Nationwide’s claimed damages. (See ECF Nos. 182, 183.) The parties have
briefed those issues. (See ECF Nos. 184-187, 195, 198.)
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Fed. R. Civ. P. 26(b)(1). Discovery need not be admissible to be discoverable. Id.
“Relevant evidence” is “evidence having any tendency to make the existence of
any fact that is of consequence to the determination of the action more probable or
less probable than it would be without the evidence.” Fed. R. Evid. 401. But the
scope of discovery is not unlimited. “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).
Nationwide’s towing or storage contracts with other governmental agencies
are not relevant to the remaining issues in this lawsuit. The City seeks to show that
Nationwide has charged excessive and illegal towing and storage fees in
connection with its services to other governmental agencies. While the Court is
still considering whether the City may introduce post-termination evidence to cutoff or limit Nationwide’s recovery of compensatory damages, the City does not
need the details of Nationwide’s contracts with other agencies to prove these
excessive fees. The City never expressly explains in its briefs the relevancy of the
contracts or related information. The City asserts that “Nationwide’s wrongful
billings were . . . facilitated by its governmental customers” (see ECF No. 190 at
Pg ID 6271.) Yet this does not tend to prove any of the City’s defenses.

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The evidence at issue does not advance the City’s claim that Nationwide was
charging excessive fees. Moreover, the City already possesses the evidence it
needs to prove this point, to the extent the Court concludes that it is admissible. As
the City states in its reply brief, it “has fully documented Nationwide’s routine use
of illegal, exorbitant and fraudulent fees with its governmental customers including
the City of Detroit and the Wayne County Sheriff.” (ECF No. 190 at Pg ID 6270;
see also ECF No. 188 at Pg ID 6111-12 (detailing the evidence reflecting what
charges were allowed under other contracts, asserting that Nationwide was
charging more, and quoting from state court decision finding that Nationwide
engaged in wrongdoing).)
Accordingly,
IT IS ORDERED that the City of Detroit’s motion to compel (ECF No.
188) is DENIED.
IT IS SO ORDERED.
s/ Linda V. Parker
LINDA V. PARKER
U.S. DISTRICT JUDGE
Dated: March 16, 2022

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