Level One Technologies, Inc. v. Penske Truck Leasing Co., L.P. et al
Filing
276
MEMORANDUM AND ORDER - IT IS HEREBY ORDERED that Penskes Motion in Limine to Exclude Non-Disclosed Evidence and Testimony, [No. 236 ], is GRANTED in part and DENIED in part. Penske may seek to introduce the evidence and testimony in question at trial. IT IS FURTHER ORDERED that iGate and Penske must produce the monthly registers in question as well as Rajasekarans spreadsheet. iGate and Penske also must make Rajasekaran available for deposition on the subject of the spreadsheet, the monthly registers, and any other time records in question. Signed by District Judge Rodney W. Sippel on 8/10/18. (KJS)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
EASTERN DIVISION
LEVEL ONE TECHNOLOGIES,
INC.,
Plaintiff,
)
)
)
)
v.
)
)
PENSKE TRUCK LEASING CO.,
)
L.P., and PENSKE LOGISTICS LLC, )
)
Defendants.
)
Case No. 4:14 CV 1305 RWS
MEMORANDUM & ORDER
Plaintiff Level One moves to exclude testimony from Defendant’s witness
Sathish Rajasekaran concerning hours that technology services company iGate
Technologies, Inc. (“iGate”) spent developing the Penske Online Payment System
(“POPS”). Level One argues that Penske withheld discovery on this subject. At
Rajasekaran’s deposition on the last day of discovery, he introduced a spreadsheet
using iGate monthly registers to estimate the hours it spent developing POPS.
Level One seeks to exclude that spreadsheet and related testimony. Because Level
One had the ability to cure any prejudice from this late disclosure by objecting
during the deposition and seeking the monthly registers after the deposition, I will
not exclude this evidence. Instead I will compel production of the registers and
allow Level One to depose Rajasekaran on this subject.
BACKGROUND
On March 21, 2016, Level One served a subpoena duces tecum on iGate for
“All documents concerning any time records, statements, invoices or other writings
reflecting work or actions undertaken by [iGate] in the development of POPS.”
(ECF No. 117-1). Level One served a request for production of the same
documents on Penske. (ECF No. 237-6). After nine months without a definitive
answer, Level One filed a motion to compel those documents. Level One withdrew
that motion when Rajasekaran submitted a sworn declaration that iGate had
provided all responsive documents. During his deposition on the last day of
discovery, however, Rajasekaran stated that iGate had monthly registers
documenting workers’ hours. He also stated that iGate previously possessed
employee time records. Unfortunately, for Level One, the employee time records—
which are more precise—had been destroyed when iGate migrated to a new system
on December 31, 2016, months after Level One had served its initial subpoena
duces tecum.
Based on the monthly registers, Rajasekaran developed a spreadsheet of the
hours iGate spent developing POPS. He described the contents of that spreadsheet
during his deposition. Level One seeks to exclude from trial that spreadsheet and
related testimony. Level One argues Penske had control over those time records
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because Rajasekaran worked at its direction, on its campus, and under its authority.
Level One further argues that it has been prejudiced by Penske and iGate’s failure
to disclose either the employee time records or monthly registers as required by
Federal Rule of Civil Procedure 26(a). These omissions allegedly prevented Level
One from being adequately prepared to depose Rajasekaran on this subject.
LEGAL STANDARD
I must determine when parties have violated the Federal Rules of Civil
Procedure and the applicable sanctions. See Sprint/United Mgmt. Co. v.
Mendelsohn, 552 U.S. 379, 384 (2008) (holding that district courts have broad
discretion in evidentiary rulings). Pursuant to Rule 37(c)(1), “if a party fails to
provide information or identify a witness as required by Rule 26(a) or (e), the party
is not allowed to use that information . . . unless the failure was substantially
justified or is harmless.” Rule 26(a), in turn, requires parties to produce a copy of
all documents “that the disclosing party has in its possession, custody, or control
and may use to support its claims or defenses . . . .”
ANALYSIS
Penske’s argues that, within the meaning of Rule 26(a), it did not have
“possession, custody, or control,” of the employee time records or monthly
registers. Specifically, those records were allegedly the property of iGate, not of
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Penske, and Penske had no control over Rajasekaran, the man who used the
monthly register.
The Federal Rules of Civil Procedure do not define what constitutes control.
It is a “fact-specific” inquiry. 8A Wright, Miller & Marcus, Fed Prac. & Proc. §
2210, at p. 397 (2d ed. 1994). In the absence of more specific guidance, the Eighth
Circuit has held that “the rules for depositions and discovery are to be accorded a
broad and liberal treatment.” Credit Lyonnais, S.A. v. SGC Int’l, Inc., 160 F.3d
428, 430 (8th Cir. 1998). Furthermore, district courts in this Circuit have defined
control as “the ability to obtain upon demand documents in the possession of
another.” Orthoarm, Inc. v. Forestadent USA, Inc., No. 4:06-CV-730 CAS, 2007
WL 1796214, at *2 (E.D. Mo. June 19, 2007) (quoting Prokosch v. Catalina
Lighting, Inc., 193 F.R.D. 633, 636 (D.Minn.2000)). In asserting the same
definition, the court in Wells v. FedEx Ground Package System held that the
defendant Fedex Ground Package System had the “practical ability” to obtain
documents from its sister company Fedex Freight. Wells v. FedEx Ground Package
Sys., Inc., No. 4:10-CV-02080-JAR, 2012 WL 4513860, at *2 (E.D. Mo. Oct. 1,
2012).
The circumstances in this case are different from a parent-subsidiary or sister
company relationship. See, e.g., id; A.O.A. v. Doe Run Res. Corp., No.
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4:11-CV-44-CDP, 2014 WL 1356103, at *1 (E.D. Mo. Apr. 7, 2014). Nonetheless,
the facts at hand reflect a close relationship between Penske and iGate. This close
relationship is apparent in iGate employees’ presence at Penske’s offices and their
shared computer systems. Level One notes, for example, that “[a] lot of the work
iGate does for Penske is actually stored on Penske, and not iGate, servers.” (ECF
No. 237 at 3 (citing ECF No. 237-4, Showalter Depo., 50:7-51:1)). There are
between twelve and twenty iGate employees located onsite at Penske, and they
reportedly use Penske laptops and email. (ECF No. 237-5, 13-14). Rajasekaran
himself has been onsite at Penske for 13 years.
With these practices in mind, Penske had the practical ability to obtain the
time records and monthly registers. iGate had shaped its entire workplace and
practices to the convenience of Penske, including by using Penske laptops and
email. The documents in question may have even been stored on Penske servers.
(ECF No. 237 at 7). Even if they were not stored on Penske’s servers, it is clear
that iGate would comply with any demand from Penske for documents supporting
the contracted projects. As a result, these documents were within Penske’s control
and Penske had the obligation to disclose these documents in a timely manner.
When deciding the appropriate sanction for this circumstance, I must
evaluate whether Penske’s non-disclosure is justified or harmless. Rodrick v. Wal5
Mart Stores E., L.P., 666 F.3d 1093, 1096–97 (8th Cir. 2012); Fed. R. Civ. P. 37(c)
(“the party is not allowed to use that information . . . unless the failure was
substantially justified or is harmless.”). To make this evaluation, I should consider
the non-exclusive list of factors provided by the Eighth Circuit including “(1) the
prejudice or surprise to the party against whom the testimony is offered; (2) the
ability of the party to cure the prejudice; (3) the extent to which introducing such
testimony would disrupt the trial; and (4) the moving party’s bad faith or
willfulness.” Id.
Level One validly argues that it was prejudiced because it was inadequately
prepared to depose Rajasekaran on the topic of the monthly registers. Level One
had the ability to cure that prejudice, however, by (1) moving for compelled
production of the monthly registers and (2) by moving for leave to depose
Rajasekaran. Neither party makes an argument that the introduction of
Rajasekaran’s testimony would disrupt the trial. Finally, it is possible that iGate
acted in bad faith. iGate is not a party to this case, however. Penske is.
Having balanced these factors, I am convinced that they weigh against
excluding the evidence in question. “Exclusion of evidence is a harsh penalty, and
should be used sparingly.” ELCA Enters, Inc. v. Sisco Equip. Rental & Sales, Inc.,
53 F.3d 186, 190 (8th Cir. 1995). Instead of excluding Rajasekaran’s testimony
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and the monthly registers, I will order iGate and Penske to produce the monthly
registers in question and Rajasekaran’s spreadsheet. Additionally, I will allow
Level One to depose Rajasekaran on this subject alone.
Accordingly,
IT IS HEREBY ORDERED that Penske’s Motion in Limine to Exclude
Non-Disclosed Evidence and Testimony, [No. 236], is GRANTED in part and
DENIED in part. Penske may seek to introduce the evidence and testimony in
question at trial.
IT IS FURTHER ORDERED that iGate and Penske must produce the
monthly registers in question as well as Rajasekaran’s spreadsheet. iGate and
Penske also must make Rajasekaran available for deposition on the subject of the
spreadsheet, the monthly registers, and any other time records in question.
______________________________
RODNEY W. SIPPEL
UNITED STATES DISTRICT JUDGE
Dated this 10th day of August, 2018.
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