Russo v. Lopez

Filing 89

ORDER Denying #63 MOTION to Compel filed by Andy Russo. Signed by Magistrate Judge George Foley, Jr. on 12/12/11. (Copies have been distributed pursuant to the NEF - MMM)

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UNITED STATES DISTRICT COURT

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DISTRICT OF NEVADA

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ANDY RUSSO,

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Plaintiff,
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vs.
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JOSEPH LOPEZ,
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Defendant.
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__________________________________________)

Case No. 2:11-cv-00284-PMP-GWF
ORDER
Motion to Compel Discovery - #63

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This matter is before the Court on Plaintiff’s Motion to Compel Discovery and for

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Sanctions (#63), filed on November 1, 2011 Defendant’s Opposition to Plaintiff’s Motion to

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Compel (#75), filed on November 18, 2011; and Plaintiff’s Reply to Defendant’s Opposition (#82),

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filed on November 29, 2011. The Court conducted a hearing in this matter on December 7, 2011.

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BACKGROUND AND DISCUSSION

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The factual background of this case is set forth in the Court’s order (#88). During the

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December 7, 2011 hearing, the Court denied Plaintiff’s motion to compel responses to most of his

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requests for production on the grounds that they are over broad and irrelevant on their face. See

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Marook v. State Farm Mutual Auto. Ins. Co., 259 F.R.D. 388, 394-95 (N.D.Iowa 2009), citing

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Cunningham v. Standard Fire Ins. Co., 2008 WL 2902621 at *1 (D.Colo 2008). Although

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Defendant stated in his Opposition that he would be willing to search for and produce relevant

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documents if Plaintiff would tailor his requests to the matters in dispute, Plaintiff’s counsel refused

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to do so. Plaintiff argued that he is entitled to inspect all of Defendants’ email communications or

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other documents for a given time period to make sure that relevant information is not withheld.

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Although relevancy under Rule 26(b) is liberally construed, Plaintiff’s argument is contrary to the

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language and spirit of Rule 26(b) and Rule 34. Absent evidence that a party is intentionally

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withholding or refusing to search for relevant documents or information, there is no basis to order a

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party to produce all of its records for inspection, regardless of relevancy.

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The Court took under advisement Plaintiff’s motion to compel responses to his requests for

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documents from New Era Builders, Inc. As discussed in Order (#88), Plaintiff Russo and

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Defendant Lopez were previously engaged in business with each other through Sierra Metals, Inc.,

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a Nevada corporation. In or about mid-2010, the parties began conducting separate architectural

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metal construction businesses, although they had not reached final agreement on the division of the

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assets of Sierra Metals, Inc. Following the separation, Lopez conducted the business through a

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new Ohio corporation he formed– Sierra Metals, Inc. USA, which was later renamed Aster

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Elements, Inc. Lopez also owns New Era Builders, Inc., an Ohio corporation. In September 2010,

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Lopez withdrew $150,000 from the Las Vegas bank account of Sierra Metals, Inc. and deposited

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the funds into a bank account of New Era Builders, Inc. Lopez states that he did this to safe-keep

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the funds until the parties’ respective rights to the assets of Sierra Metals, Inc. are determined.

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Lopez produced a limited number of bank and accounting records for New Era Builders, Inc. to

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account for the transfer of the $150,000.

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Russo, however, has requested (1) a complete electronic copy of the Quickbooks data files

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for New Era Builders, Inc. (Request No. 12); (2) all bank account records for New Era Builders,

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Inc. from January 1, 2010 through the present (Request No. 13); (3) a copy of all payroll reports for

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New Era Builders, Inc. from January 1, 2010 through the present (Request No. 14); and (4) a copy

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of all accounts payable and accounts receivable aging schedules for New Era Builders, Inc. from

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January 1, 2010 through the present (Request No. 15). Lopez objected to these requests as

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irrelevant and unduly burdensome. In support of his objections, Lopez states that New Era did not

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take over any jobs or projects of Sierra Metals, Inc., did not profit from the work of persons

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employed and paid by Sierra Metals, Inc., and is not even in the same line of construction business

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as Sierra Metals, Inc. or Sierra-Southwest– Russo’s successor construction company. Lopez also

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states that New Era Builders, Inc. is in the process of winding down its general contracting business

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and does not have any employees or independent contractors on its payroll.
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Based on the information presently available to the Court, it appears since the parties’ split,

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Mr. Lopez has conducted his part of the architectural metal construction business through Sierra

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Metals, Inc. USA and Aster Elements, Inc. Absent some evidence or reason to believe that Lopez

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has also conducted this business through New Era Builders, Inc., the Court agrees that Plaintiff’s

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requests for production of documents from New Era Builders, Inc. are over broad and irrelevant. If

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Plaintiff develops some evidence or grounds to believe that assets of Sierra Metals, Inc., other than

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the $150,000, have, in fact, been transferred to New Era Builders, Inc., then a broader production of

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the books and records of New Era Builders, Inc. may become appropriate. Accordingly.

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IT IS HEREBY ORDERED that Plaintiff’s Motion to Compel Discovery and for
Sanctions (#63) is denied.
DATED this 12th day of December, 2011.

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______________________________________
GEORGE FOLEY, JR.
United States Magistrate Judge

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