Whitfield v. Pick Up Stix, Inc. et al

Filing 59

ORDER Denying 52 Defendant's Motion for Sanctions. Signed by Magistrate Judge George Foley, Jr on 9/1/11. (Copies have been distributed pursuant to the NEF - EDS)

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UNITED STATES DISTRICT COURT
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DISTRICT OF NEVADA
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HENRY A. WHITFIELD,

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Plaintiff,
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vs.
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PICK UP STIX, INC. and PICK UP STIX
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NEVADA, INC.,
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Defendants.
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__________________________________________)

Case No. 2:10-cv-00099-ECR-PAL
ORDER
Defendant’s Motion for Sanctions (#52)

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This matter is before the Court on Defendant’s Motion for Sanctions (#52), filed June 16,

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2011; Plaintiff’s Opposition to Defendant’s Motion for Sanctions (#53), filed June 30, 2011; and

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Defendant’s Reply in Support of Motion for Sanctions (#54), filed July 8, 2011.

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BACKGROUND
Plaintiff seeks damages based on a claim of racial discrimination asserted under Title VII of

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the Civil Rights Act of 1964 (codified at 42 U.S.C. §§ 2000e-a et seq.). On March 14, 2011, the

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matter was referred to the undersigned United States Magistrate Judge to conduct an Early Neutral

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Evaluation (ENE). See Local Rule (LR) 16-6 (setting forth the purpose and procedure for the

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District of Nevada’s ENE program). The ENE went forward on May 25, 2011, and lasted for

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approximately three hours. See Order (#51). The parties did not reach a settlement and the case was

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returned to the normal litigation track.

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On June 16, 2011, Defendants filed the Motion for Sanctions (#52) currently before the

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Court. Defendants claim that the Plaintiff’s decision not to state the amount of damages he is

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seeking or an amount he would consider to settle the case during the ENE conference constitutes a

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failure to participate in good faith. Defendants further claim the lack of good faith participation is

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underscored by Plaintiff’s refusal to respond to a “generous settlement offer” made despite

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Defendants’ belief that there is “no basis for the case.” See Def.s’ Mot. (#52) at 2:22-23.

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Defendants contend that the “fundamental purpose of the session” was frustrated by Plaintiff’s

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“refus[al] to commit to any [settlement] amount whatsoever.” Id. at 2:24-25.

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In response, Plaintiff states that he “declined Defendants’ offer and decided against making a

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counteroffer based upon the clear indication taken from the Defendants’ offer that any counteroffer

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would be futile as they were not serious about settlement.” See Pl.’s Resp. (#53) at 4:17-19.

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Plaintiff states further that during the ENE conference he was neither required to settle the case nor

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required to tell Defendants what amount he would settle for. Id. at 6:12-15. According to Plaintiff,

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he complied with ENE requirements set forth in the scheduling order and the decision “not to accept

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or counter [Defendants’] offer” does not support a finding that he did not participate in good faith.

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Id. at 7:16-18.

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DISCUSSION

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All parties have a responsibility to comply with court orders. Failure to comply with pretrial

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scheduling orders may result in sanctions under Rule 16(f). The purpose of Rule 16 is to “encourage

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forceful judicial management” of litigation, as well as to improve the quality of trial by more

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thorough preparation. See Advisory Committee on Rules, Notes to 1983 Amendment; Rules

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16(a)(2) and 16(a)(4). The settlement of cases prior to the filing of dispositive motion and trial

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benefits the court and the parties by securing just, speedy and inexpensive determinations consistent

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with Rule 16. Pitman v. Brinker Intern., Inc., 216 F.R.D. 481, 485 (D. Ariz. 2003). Local Rule 16-6

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mandates that all employment discrimination actions undergo an Early Neutral Evaluation. “The

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purpose of the early neutral evaluation session is for the evaluating Magistrate Judge to give the

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parties a candid evaluation of the merits of their claims and defenses.” LR 16-6. Although the

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parties cannot be compelled to settle, under Rule 16(f), the court may issue sanctions if a party or its

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attorney is substantially unprepared to participate or does not participate in good faith. Fed. R. Civ.

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Pro. 16(f); see Tamura v. F.A.A., 908 F.2d 977 at *2 (9th Cir. 1990). Prior to the imposition of

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sanctions under Rule 16(f), a party must be afforded notice and an opportunity to be heard. Ayers v.

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City of Richmond, 895 F.2d 1267, 1270 (9th Cir. 1990). The imposition of sanctions under Rule 16

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is a matter committed to the sound discretion of the district court. See Ford v. Alfaro, 785 F.2d 835,
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840 (9th Cir.1986).
The Court does not find that Plaintiff’s participation in the ENE held on May 25, 2011, was

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lacking good faith. Plaintiff complied with the Court’s Order (#46) and made a good faith attempt to

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participate in the ENE conference. Because of the confidential nature of the ENE, the Court will

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not comment on what specifically transpired during the ENE session except to state that in

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compliance with the Court’s order, Plaintiff submitted to the Court a detailed Confidential Written

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Evaluation Statement of the case prior to the ENE, attended the ENE conference, and actively

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participated. Plaintiff was neither unprepared for the ENE nor was he recalcitrant during the

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conference.

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The lack of settlement in this case did not result from the Plaintiff’s failure to adequately

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prepare for the ENE. While the Court would have hoped that the experience of discussing the

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benefits of compromising claims and probing the relative merits and likely exposures of both parties'

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cases would have caused Plaintiff to indicate a willingness to further negotiate with the Defendants,

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that did not occur. The parties’ failure to settle during a pretrial conference has no bearing on the

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Court’s decision to impose sanctions. Rule 16 “was not designed as a means for clubbing the

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parties-or one of them-into an involuntary compromise.” Kothe v. Smith, 771 F.2d 667, 669 (2nd

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Cir.1985). Each party has a right to their day in court, if they so desire. The Court therefore finds

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the Plaintiff participated in the ENE held on May 25, 2011, in good faith. Accordingly,

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IT IS HEREBY ORDERED that Defendant’s Motion for Sanctions (#52) is denied.

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Dated this 1st day of September, 2011.

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___________________________________
GEORGE FOLEY, JR.
United States Magistrate Judge

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