50820 Schoenherr Road (FJ) Associates, LLC, a foreign corporation v. Family Fare, LLC, a Michigan limited liability company et al
Filing
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OPINION AND ORDER Granting Defendants' 18 Motion to Strike Experts. Signed by District Judge Judith E. Levy. (SBur)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
50820 Schoenherr Road (FJ)
Associates, LLC,
Case No. 17-10741
Plaintiff,
Judith E. Levy
United States District Judge
v.
Family Fare, LLC, and
SpartanNash Company, d/b/a
Spartan Stores, Inc.,
Mag. Judge David R. Grand
Defendants.
________________________________/
OPINION AND ORDER GRANTING DEFENDANTS’ MOTION TO
STRIKE EXPERTS [18]
This case is before the Court on defendants’ motion for “an order
striking the reports of plaintiff’s experts and precluding them from
testifying pursuant to Fed. R. Civ. P. 37(c).” (Dkt. 18 at 1.) Defendants
allege that plaintiff has “repeatedly failed to comply with two of [the]
Court’s scheduling orders, by failing to provide timely damages expert
reports containing and disclosing the information required by Fed. R.
Civ. P. 26(a).” (Id.) For the reasons set forth below, defendants’ motion
is granted.
I.
Introduction
On March 7, 2017, plaintiff 50820 Schoenherr Road (FJ) Associates,
LLC, filed suit against defendants Family Fare, LLC and SpartanNash
Company for damages resulting from an alleged failure in February 2014
to surrender a commercial property in the condition required under their
lease agreement. (Dkt. 1.) Plaintiff seeks “an unspecified amount of
money damages in excess of $75,000, including the amount to repair the
damages to the premises.” (Dkt. 11 at 4.)
The parties filed a joint discovery plan on May 19, 2017, in which
they agreed that plaintiff’s expert disclosure(s) and report(s) would be
provided no later than September 15, 2017. (Id. at 11.) The Court issued
a scheduling order on May 30, 2017, establishing the September 15, 2017
deadline. (Dkt. 12.) Defendants served interrogatories on plaintiff in
July 2017, seeking the total amount of damages claimed in the case
(Interrogatory No. 2) and detailed information about each item of
damages being claimed (Interrogatory No. 3). (Dkt. 18-2 at 3.) Plaintiff
objected to Interrogatory No. 2, stating that it required an expert opinion,
and that any damages report would be made available to defendant “upon
receipt from its expert.” (Id.)
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On September 15, 2017, plaintiff provided defendants with a list of
experts and a copy of a previously disclosed 2015 due diligence report.1
(Dkt. 18 at 14.) On September 22, 2017, defendants sent plaintiff a letter
outlining numerous alleged deficiencies with plaintiff’s interrogatory
responses, document production, and expert disclosure.
(Dkt. 18-3.)
Pursuant to the Court’s Practice Guidelines, defendants requested a
telephonic status conference after receiving no response to the deficiency
letter. (Dkt. 18 at 15.) The status conference was held on October 11,
2017.
Following the status conference, the Court issued an amended
scheduling order, establishing a deadline of October 18, 2017 for plaintiff
to provide supplemental responses to defendants’ interrogatories and
The sixty-three page report is included, in its entirety, as Exhibit F to defendants’
motion. (Dkt. 18-7.) It includes a four page “narrative” to introduce the report (Id.
at 2–5), a one page excerpt of relevant lease references (Id. at 8), one page itemizing
thirty-three “existing conditions” on the premises (Id. at 9), forty-nine pages of
photographs (Id. at 10–58), and two estimates for repair work (Id. at 59–64).
Defendants first received a copy of this report, without the narrative, in August 2015.
(Dkt. 20-3 at 2.) In response to its receipt, defendants hired an individual to inspect
and prepare an independent report on the condition of the premises. (Id.) The report
prepared for the defendants includes additional excerpts from the lease agreement
(Id. at 3) and its own assessment of the “larger dollar items” listed within plaintiff’s
report. (Id. at 4). The report concludes by stating that “[plaintiff’s] report is factual,
with respect to the conditions they observed, [but] it is clearly inconsistent with key
provisions of the lease . . . ” and asserts that any settlement payment in excess of
$2500.00 would be “completely unreasonable.” (Id. at 8.)
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document production requests, and establishing an extended deadline of
October 31, 2017 for plaintiff to provide its expert disclosure(s) and
report(s).
On October 19, 2017, plaintiff provided supplemental interrogatory
answers. In response to Interrogatory No. 2, which requested the “total
amount of damages that Landlord contends it is owed in this litigation,”
plaintiff continued to object to the question by asserting that it “calls for
an expert opinion.” (Dkt. 18-4 at 3.) Subject to that objection, plaintiff
referenced the 2015 report and, based on that report, asserted it is owed
$180,486.98 plus attorney costs and fees.
(Id.)
In response to
Interrogatory No. 3, plaintiff inserted a copy of the itemized list of
damages from the 2015 report and asserted that “[t]he costs for the
repairs to the Premises caused by the Plaintiff were included in the
Tenant Improvement Allowance for the new tenant.” (Dkt. 18-4 at 6.)
On October 26, 2017, plaintiff sent an email to the Court and
requested an additional two-week extension to the previously extended
October 31, 2017 deadline for expert disclosure(s) and report(s). The
Court’s case manager advised plaintiff that any further request for an
extension would need to be set forth in a motion. (Dkt 18 at 17.) Plaintiff
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did not file a motion, and on October 31, 2017, plaintiff provided
disclosures and reports for two experts. (Id.) Defendants argue that the
proffered reports fail to comply with the requirements of Fed. R. Civ. P.
26(a)(2)(B), and have brought the present motion seeking an order under
Fed. R. Civ. P. 37(c) precluding plaintiffs from using the proffered
reports.
II.
Analysis
An expert report “must contain: (i) a complete statement of all
opinions the witness will express and the basis and reasons for them; (ii)
the facts or data considered by the witness in forming them; [and] (iii)
any exhibits that will be used to summarize or support them.” Fed. R.
Civ. P. 26(a)(2)(B). “An expert opinion must ‘set forth facts’ and, in doing
so, outline a line of reasoning arising from a logical foundation.”
Brainard v. Am. Skandia Life Assur. Corp., 432 F.3d 655, 657 (6th Cir.
2005). In this case, each of plaintiff’s expert reports fails to meet the
requirements of Fed. R. Civ. P. 26(a)(2)(B).
Plaintiff’s first report is from Jason Krentler regarding “the market
rental rate of the subject property as of September 17, 2015.” (Dkt. 18-5
at 3.) The report is included in its entirety as Exhibit E to defendants’
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motion. (Dkt. 18-6.) The report concludes that the prevailing market
rental rate for properties comparable to the property at 50820
Schoenherr Road was $8.00 to $10.00 per square foot. (Id. at 5.) The
report contains a brief methodology section which states: “[t]he scope of
our analysis included research around the following market indicators:
(1) available comparable listings; (2) comparable lease transactions; (3)
market participant interviews; . . . and the associated contract inputs.”
(Id. at 11.) The report is completely devoid of the underlying “facts or
data” related to the comparable listings, comparable lease transactions,
and/or market participants; only a summary of the conclusions is
included. (Id. at 13.)
Plaintiff’s second report supports the proffered testimony of Steve
Laskowsi regarding the “alleged damages and cost of repairs to the
Premises.” (Dkt. 18-5 at 4.) The report is included in its entirety as
Exhibit F to defendants’ motion. (Dkt. 18-7.) As previously stated, the
report includes an itemized list of thirty-three “existing conditions,” a
cost estimate for each of the items, and – in some cases – references to
specific photographs documenting the damage. (Dkt. 18-7 at 9.) The
report also includes repair estimates from two contractors: (1) a proposal
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from Professional Sprinkler Inc., for new fire sprinkler heads for
$1,100.00; and (2) a proposal from Level 1 HVAC Services, Inc., to remove
walk-in coolers and freezers for $24,000.00 and to do preventative
maintenance on the HVAC system for $5,890.00. (Dkt. 18-7 at 60–65.)
The two proposals provide documentation for only three of the thirtythree items in the list of estimated damages. In addition, the report does
not contain any “facts or data” or “exhibits” supporting actual incurred
costs of repairs.
Fed. R. Civ. P. 37(c)(1) states that “[i]f a party fails to provide
information . . . as required by Rule 26(a) . . . , the party is not allowed to
use that information . . . to supply evidence on a motion, at a hearing, or
at trial, unless the failure was substantially justified or is harmless.”
Furthermore, “Fed. R. Civ. P. 37(c)(1) requires absolute compliance with
Rule 26(a), that is, it ‘mandates that a trial court punish a party for
discovery violations in connection with Rule 26 unless the violation was
harmless or substantially justified.” R.C. Olmstead Inc., v. CU Interface,
LLC, 606 F.3d 262, 271 (6th Cir. 2010) (internal citations omitted). The
burden falls on the potentially sanctioned party to prove harmlessness.
Roberts v. Galen of Virginia, Inc. 325 F.3d 776, 782 (6th Cir. 2003).
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In this case, plaintiff argues only that its “expert disclosures are
fully compliant with [Rule 26].” Plaintiff offers no further explanation or
justification to the Court regarding the deficiencies described above, and
makes no argument to prove that the deficiencies are harmless. At
plaintiff’s request, the Court has already extended the plaintiff’s expert
disclosure and report deadline six weeks beyond its original date.
Despite this extension, plaintiffs have failed to proffer the information
required by Fed. R. Civ. P. 26(a)(2) – in particular, the facts and data
underlying the anticipated expert testimony – in the reports they have
provided.
Accordingly, defendants’ motion is GRANTED. Pursuant to Fed. R.
Civ. P. 37(c), plaintiff’s expert reports are STRICKEN and plaintiff may
not use the reports to support a motion, at a hearing, or at trial.
IT IS SO ORDERED.
Dated: December 20, 2017
Ann Arbor, Michigan
s/Judith E. Levy
JUDITH E. LEVY
United States District Judge
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CERTIFICATE OF SERVICE
The undersigned certifies that the foregoing document was served
upon counsel of record and any unrepresented parties via the Court’s
ECF System to their respective email or First Class U.S. mail addresses
disclosed on the Notice of Electronic Filing on December 20, 2017.
s/Shawna Burns
SHAWNA BURNS
Case Manager
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