Caesars World, Inc. v. July et al

Filing 61

Emergency MOTION to Compel Deposition of July and For Sanctions by Plaintiff Caesars World, Inc., Counter Defendant Caesars World, Inc.. Responses due by 3/16/2012. (Attachments: # 1 Exhibit Stewart Declaration and Exhibits 1-5, # 2 Exhibit Sand Declaration and Exhibits 1-3, # 3 Exhibit Boyle Declaration)(Sand, Nadya)

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JAMES D. BOYLE, ESQ.
Nevada Bar No. 08384
[e-mail]
SANTORO, DRIGGS, WALCH,
KEARNEY, HOLLEY & THOMPSON
400 South Fourth Street, Third Floor
Las Vegas, Nevada 89101
Telephone:
702/791-0308
Facsimile:
702/791-1912

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DAVID J. STEWART, ESQ.
Georgia Bar. No. 681149
[e-mail]
NADYA MUNASIFI SAND, ESQ.
Georgia Bar No. 156051
[e-mail]
ALSTON & BIRD LLP
1201 West Peachtree Street
Atlanta, Georgia 30309-3424
Telephone:
404/881-7000
Facsimile:
404/881-7777

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Attorneys for Caesars World, Inc.

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UNITED STATES DISTRICT COURT

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DISTRICT OF NEVADA

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CAESARS WORLD, INC., a Florida
corporation,

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Plaintiff,

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v.

CASE NO.:

2:11-cv-00536-GMN-(CWH)

CAESARS WORLD, INC.’S
EMERGENCY MOTION TO COMPEL
AND FOR SANCTIONS

MARCEL JULY, an individual; and
OCTAVIUS TOWER LLC, a Nevada limited
liability company,

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Defendants.

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Pursuant to Rule 37 of the Federal Rules of Civil Procedure and Local Rule 26-7,
Plaintiff Caesars World, Inc. (“Caesars”) respectfully moves the Court on an emergency basis to
compel Defendant Marcel July (“July”) to personally appear in Las Vegas, Nevada, for his

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deposition on March 12, 2012. Caesars further requests that the Court sanction July for his

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failure to appear for a previously noticed deposition without legitimate excuse. As sanctions,

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Caesars requests that the Court preclude July from testifying at trial, instruct July that the Court

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will dismiss July’s counterclaims if July fails to comply in full with the Court’s order on this

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motion, and award Caesars recovery of the attorney’s fees and costs it has been forced to incur in

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connection with this motion and seeking to secure July’s appearance for deposition in this case.

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Caesars submits this motion on an emergency basis because the discovery deadline is set

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for April 16, 2012, and Caesars anticipates the need to take third-party discovery based on the

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information July provides at his deposition. Given the pending discovery cutoff deadline, and

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the importance of July’s deposition to Caesars’ ability to timely complete any necessary third

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party discovery, Caesars respectfully contends that an expedited date for completing July’s

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deposition is required and resolution of the instant Motion on an emergency basis is necessary to

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obtain such an expedited deposition date.

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I. FACTUAL BACKGROUND

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Defendant Marcel July’s discovery violations are well documented in this case. (Order

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on Motion to Compel, Dkt. 49; Motion to Compel, Dkt. 42). On December 19, 2011, this Court

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granted Caesars’ Motion to Compel July to produce responses to Caesars’ discovery requests,

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and sanctioned July for his discovery violations. (Dkt. 49.) The present motion is a result of

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July’s failure, yet again, to comply with his discovery obligations in this case.

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As counsel for the parties exited the courtroom following the show cause hearing held on

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January 19, 2012, Caesars’ counsel requested that July’s counsel provide dates when he and and

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his client would be available for July’s deposition in Las Vegas. (Stewart Decl., Ex. A, ¶ 4.)

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Caesars followed-up with July’s counsel on several occasions, hoping to schedule July’s

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deposition at a time that would be convenient for July given that he would be travelling from

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Europe for the deposition. (Id. at ¶ 5.) July never objected to the deposition taking place in Las

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Vegas or provided Caesars with any dates when he would be available for his deposition. (Id. at

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¶ 6.)

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After two weeks of trying to get dates from July, and with the then impending discovery

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cutoff deadline of February 15, 2012, Caesars was left with no choice but to notice July’s

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deposition for February 15. (Id. at ¶ 7; Motion to Extend Time, Dk. 56.) Caesars, however,

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informed July’s counsel that if the Court extended the discovery period, Caesars would be

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willing to push the date back. (Stewart Decl., Ex. A, ¶ 8.) The Court granted Caesars’ extension

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on February 7, 2012, extending discovery until April 16, 2012. (Dkt. 60.) On February 9, 2012,

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still not having received any dates from July or his counsel, Caesars re-noticed the deposition for

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February 24, 2012, in Las Vegas, Nevada, giving July more than two weeks notice of the

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deposition. (Stewart Decl., Ex. A, ¶ 9.)

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Four days prior to July’s deposition, Timothy Bennett, Esq., an attorney who works with

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Mr. Sanft, informed Caesars’ counsel that July had a conflict with personally appearing for his

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deposition but could appear by telephone on the scheduled deposition date. (Sand Decl, Ex. B, ¶

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4.) Mr. Bennett did not know for certain why July was refusing to appear in person as noticed,

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but speculated that it was because of the expense of traveling to the United States. (Id.) Mr.

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Bennett did not provide alternative dates for when July was available for his deposition. (Id.)

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Caesars’ counsel informed Mr. Bennett that Caesars would not agree to a telephonic deposition,

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but said that she would get back to him regarding the deposition date. (Id. at ¶ 5.)

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The following day, Caesars’ counsel emailed Mr. Bennett and Mr. Sanft, informing them

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that Caesars would not withdraw its deposition notice because it was validly noticed and because

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Caesars had been trying for weeks without response to get July’s cooperation in scheduling the

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deposition. (Id. at ¶ 6.) Caesars’ counsel further requested that Mr. Sanft confirm whether his

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client would be attending the deposition as noticed. (Id.)

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On February 22, Mr. Bennett confirmed that July would not attend his deposition on the

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24th because of the expense of traveling to Las Vegas, and because “he believes that the burden

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of such a travel at any time for a deposition would outweigh the benefit that may be conferred by

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a mere telephonic appearance on such an occasion.” (Id. at ¶ 7.) Mr. Bennett also informed

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Caesars for the first time that Mr. Sanft could not attend the scheduled deposition. (Id.) No

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alternative dates for a deposition were offered. (Id.)

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Caesars’ counsel and Mr. Sanft had a telephonic meet and confer conference on

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Thursday, February 23, 2012 regarding the scheduled deposition. (Stewart Decl., Ex. A, ¶ 10.)

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Although Caesars did not agree to vacate the deposition notice, Mr. Sanft made clear that his

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client would not be appearing on the noticed date. (Id. at ¶ 11.) Caesars requested that Mr.

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Sanft, by the next day, provide dates when he and his client could personally appear for July’s

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deposition in Las Vegas. (Id.) Caesars further explained in detail why it was necessary for

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July’s deposition to take place in person in the United States and requested confirmation that

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July would appear in person in either Las Vegas or, in the alternative, Atlanta (where Caesars’

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lead counsel is located). (Id.) To date, Caesars has received no response from July as to dates

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when he is available for deposition or whether he will agree to be deposed in the United States.

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(Id.) July did not appear for his deposition on February 24, 2012. (Boyle Decl, Ex. C, at ¶ 4.)

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Pursuant to LR 26-7, attached is Caesars’ certification that it has personally consulted with July,

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with sincere efforts, about its discovery dispute and that the parties are unable to resolve the

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matter without Court action. (Stewart, Decl., Ex. A, ¶¶ 3, 10-12.)
II. MEMORANDUM OF POINTS AND AUTHORITIES

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A.

July Should be Compelled to Personally Appear in Las Vegas, Nevada for a
Deposition on March 12, 2012.
A party may depose another party by oral examination after providing reasonable written

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notice that includes the time and place of deposition. Fed. R. Civ. P. 30(a)(1). The deponent

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must attend the deposition as noticed, unless the deponent obtains a protective order from the

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court. Fed. R. Civ. P. 26(c) (“The court may, for good cause, issue an order to protect a

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party…from…undue burden or expense, including…specifying terms, including time and place,

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for the disclosure or discovery”); see also Rule 30(b)(4) (The parties may stipulate – or the court

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may on motion order – that a deposition be taken by telephone or other remote means.). A

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motion for protective order is timely if filed prior to the subject discovery. Seminara v. City of

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Long Beach, 68 F.3d 481, 1995 WL 598097, *4 (9th Cir. 1995) (noting that a movant must have

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good cause to excuse the untimeliness of a motion filed after discovery); Collins v. Wayland, 139

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F.2d 677 (9th Cir. 1944), cert. denied, 322 U.S. 744 (1944) (stating that deponent could not

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complain of deposition location after failing to file a motion to seek relief); see also Fed. R. Civ.

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P. 37(d)(2) (failure to attend deposition is not excused on grounds that discovery was

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objectionable unless there is pending Rule 26(c) motion). The party seeking the protective order

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bears the burden of demonstrating “specific prejudice or harm will result if no protective order is

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granted,” and broad allegations of harm are not sufficient to satisfy Rule 26(c). Luangisa v.

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Interface Operations, 2011 WL 6029880, * 12 (D. Nev. Dec. 5, 2011) (quoting Phillips v. Gen.

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Motors Corp., 307 F.3d 1206, 1211 (9th Cir. 2002)).

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“[A]bsent extreme hardship, a nonresident plaintiff should appear for his deposition in

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the chosen forum.” U.S. v. Rock Springs Vista Devel., 185 F.R.D. 603, 604 (D. Nev. April 19,

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1999) (requiring plaintiff to appear in person for deposition in chosen forum because plaintiff

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“has not only taken the volitional step of initiating the lawsuit or claim, he or she stands to gain a

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substantial monetary sum and/or other beneficial relief as a result of suing a defendant”).

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Conclusory assertions that travel results in severe financial hardship are insufficient to meet this

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standard. Joseph v. Las Vegas Metropolitan Police Dept., 2010 WL 3238992, *6. (D. Nev. Aug.

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13, 2010) (finding that plaintiffs failed to show extreme hardship by merely asserting “that travel

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to Las Vegas would subject [plaintiff] to sever financial hardship and [plaintiff’s] travel is

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limited by unspecified ailments”); Rock Springs Vista Devel., 185 F.R.D. at 604 (mere

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inconvenience or expense is not a legitimate reason to refuse to appear for a deposition).

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Indeed, this Court has recognized that telephonic depositions are not an adequate

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substitute for an in person deposition. “Telephone depositions are not recommended for

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obtaining controversial testimony. You cannot observe the impact of your questions or the

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witness’ nonverbal responses. Moreover, you will be unable to ascertain if anyone is listening in

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or ‘coaching’ the witness.” Rock Springs Vista Development, 185 F.R.D. at 604 (quoting William

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W Schwarzer, A. Wallace Tashima, & James M. Wagstaffe, FEDERAL CIVIL PROCEDURE

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BEFORE TRIAL § 11.443 (1997)). Depositions by telephone for foreign deponents are further

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complicated by the Court’s limited ability to resolve disputes during the pendency of the

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deposition. Hyde & Drath v. Baker, 24 F.3d 1162 (9th Cir. 1994) (affirming that deposition

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should take place in San Francisco and not Hong Kong so that the court could oversee the

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proceedings and because deponents had done business in forum); HTC Corp. v. Tech. Prop.,

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2008 WL 5244905, *2 (N.D. Cal. Dec. 16, 2008) (“this court’s authority to resolve any disputes

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arising during a deposition could be compromised by sovereignty issues if depositions took place

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in Taiwan, rather than the United States”).

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Having requested dates since January 19 when July would be available for his deposition,

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and receiving none, Caesars served a proper Notice of Deposition on July. It was days before his

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deposition that July unilaterally decided that it was not worth traveling to the United States for

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his deposition – not for his noticed deposition date or apparently any other date. At no point

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prior to the noticed deposition date did July seek a protective order. Having failed to seek a

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protective order prior to his deposition, this Court should find that July waived any right to

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object to appearing in the United States and compel him to appear in Las Vegas for his

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deposition.

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Even if July had timely filed for a protective order, he will not suffer undue burden or

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expense in traveling to the United States. July is a counterclaim plaintiff in this lawsuit asserting

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trademark rights that he claims are protected by Nevada law through registrations with the state

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of Nevada. As a counterclaimant to a declaratory judgment action, he is functionally the plaintiff

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in this case, and it was his groundless threats that he would sue Caesars if it did not stop use of

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its OCTAVIUS TOWER mark in Las Vegas that led to the filing of this lawsuit. Moreover, July

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claims that he is in the process of opening a new entertainment center in Las Vegas less than

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three miles from the location of the noticed deposition. (Sand Decl, Ex. B., ¶ 8) July’s claim

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that he would suffer severe financial hardships by appearing in this District for his deposition is

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thus baseless. It is clear that his reason for not showing up is to further thwart Caesars’

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legitimate attempts at getting discovery in this case for the purpose of stalling and increasing the

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cost of the case to Caesars, despite that fact that July is the true plaintiff.

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A telephonic deposition is not acceptable to Caesars for a number of reasons:

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July has been identified as the Defendants’ sole witness. It is crucial for Caesars

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to see first-hand July’s nonverbal responses to gage his credibility in response to questions asked

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at the deposition and to determine how he will appear at trial.

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July speaks with a German accent that could make effective questioning of him

by telephone difficult or impossible.
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Taking a deposition by telephone leaves the examiner in a position where it

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cannot control the deposition environment, opening the possibility of inappropriate activity or

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coaching of the witness by a third party without the examiner’s knowledge. That possibility is

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quite real in this case. Throughout this matter, July has been counseled by a German attorney

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named Christian Kaldenhoff, who, perhaps not unexpectedly, has shown a lack of knowledge of

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U.S. laws and procedural and ethical rules (including contacting Caesars’ officers directly

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despite knowledge that Caesars is represented by counsel and engaging in the unauthorized

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practice of law in the United States). (Stewart Decl., Ex. A., ¶ 12.) It is reasonable to assume

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that Mr. Kaldenhoff would be present at July’s deposition and could inappropriately counsel or

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coach July without Caesars’ knowledge.

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Based on July’s history of failing to comply with his discovery obligations, it is

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reasonable to assume that Caesars might seek the Court’s intervention during the course of the

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deposition. Having the deposition take place in this forum will facilitate more ready resolution

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of any issues.

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5.

Finding a U.S. court reporter in Germany who could take the deposition would be

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difficult and expensive, if such a person even exists. Requiring Caesars to pay for a court

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reporter to travel to Germany would be an unreasonable expense in light of July’s claims for

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relief from this Court and his active business activities in the State. It is also unclear to Caesars

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whether, under international treaties, it is even legally permissible for Caesars to take a

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deposition of a German national in Germany.

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Caesars has numerous exhibits it needs to question July about, including

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documents written in German and contracts that would be difficult to examine or discuss via

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telephone.

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For these reasons, the Court should compel July to personally appear in Las Vegas for his

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deposition on March 12, 2012 at the offices of Caesars’ Las Vegas counsel commencing at 9:00

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am PDT.

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B.

July Should be Sanctioned for Failing to Comply with his Discovery Obligations.

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This Court should impose sanctions upon July pursuant to Fed. R. Civ. P. Rule 37(d)(1)

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for his second unjustified failure to comply with his discovery obligations. Rule 37(d)(1)(A)(i)

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provides that “[t]he court where the action is pending may, on motion, order sanctions if: (i) a

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party…fails, after being served with proper notice, to appear for that person’s deposition.” Rule

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37(d)(2) further provides that failure to attend a deposition “is not excused on the ground that the

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discovery sought was objectionable, unless the party failing to act has a pending motion for a

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protective order under Rule 26(c).” Even if the deponent notifies opposing counsel in advance of

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the deposition that he will not be attending, that still constitutes a sanctionable failure to appear

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unless the party seeks relief from the court in advance of the noticed deposition date. See Henry

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v. Gill Indus., Inc., 983 F.2d 943 (9th Cir. 1993).

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Rule 37(d)(3) provides that any of the sanctions listed in Fed. R. Civ. P. 37(b)(2)(A) can

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be entered for failure to appear at a deposition, but that rule mandates an award of fees “unless

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the failure was substantially justified or other circumstances make an award of expenses unjust.”

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Fed. R. Civ. P. 37(d)(3); Ziehlke v. City of Angels Camp, No. 1:08-cv-1802-A WI-GSA, 2009

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WL 2424696, *3 (E.D. Cal. Aug. 7, 2009) (“An award of expenses does not require a showing of

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willfulness or improper intent; rather the standard is whether there was a substantial justification

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for the losing party’s conduct.”). The Ninth Circuit has previously affirmed as a sanction for

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failing to appear at a properly scheduled and noticed deposition an order precluding the deponent

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from testifying at trial. Caesars World, Inc. v. Milanian, 126 Fed.Appx. 775, 777 (9th Cir. 2005)

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(affirming district court’s ruling to preclude defendant from testifying at trial).

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July’s failure to attend his deposition is another wholly unjustified discovery violation.

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July’s sole reasons for not attending his deposition – articulated only days before his deposition –

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is that traveling to the deposition is expensive, and that he believes a deposition in Las Vegas is a

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burden on him. As indicated supra, July’s reasons for not attending his deposition are meritless

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given that July is asserting claims against Caesars in this Court, under the laws of this State, and

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is preparing to open a business in Las Vegas. At no time has July claimed that the deposition

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notice was invalid. He simply chose unilaterally not to attend without seeking any relief from

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this Court. July has also refused to provide an alternate date for his deposition or agree that he

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will appear in person for a re-noticed deposition.

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July has thwarted Caesars’ attempts to complete its discovery at every phase of this case,

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and this Court has already sanctioned July once for his blatant disregard for his discovery

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obligations. As a result of July’s constant discovery violations, Caesars has incurred significant

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expense and time trying to obtain discovery from July, and has been forced to file three

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extensions of time to complete its discovery in this case (and it may be forced to file a fourth

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extension due to July’s failure to appear for his deposition). July’s refusal to engage his

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discovery obligations is a blatant attempt to thwart Caesars legitimate discovery in this case and

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to deny Caesars the relief it seeks through its declaratory judgment claims. As the true plaintiff

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in this case, July’s conduct is inexcusable, and Caesars respectfully submits that it should not be

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tolerated by this Court further.

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Accordingly, Caesars requests that the Court: (1) order that July is precluded from

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testifying at trial in this case; (2) order July to appear for a discovery deposition in Las Vegas at

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the offices of Caesars’ Las Vegas counsel on March 12, 2012 at 9:00 AM PDT; and (3) order

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July to pay the reasonable fees and costs Caesars has incurred in connection with this motion and

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otherwise attempting to secure July’s deposition. Caesars further requests that the Court instruct

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July in its Order that any further discovery violations could lead to this Court dismissing July’s

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counterclaims. If Caesars’ request for fees and costs is granted, Caesars will submit a fee

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petition and bill of costs within ten (10) days of the Court’s order on this motion, and Caesars

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requests that the Court order Defendants to pay the awarded fees and costs within ten (10) days

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after the Court’s order on Caesars’ fee petition.

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Respectfully submitted, this 28th day of February, 2012.
SANTORO, DRIGGS, WALCH,
KEARNEY, HOLLEY & THOMPSON

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/s/ James D. Boyle
JAMES D. BOYLE, ESQ.
Nevada Bar No. 08384
400 South Fourth Street, Third Floor

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Las Vegas, Nevada 89101

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ALSTON & BIRD LLP
David Stewart, Esq.
Georgia Bar. No. 681149
Nadya Munasifi Sand, Esq.
Georgia Bar No. 156051

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Admitted Pro Hac Vice

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Attorneys for Caesars World, Inc.

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CERTIFICATE OF SERVICE

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Pursuant to Fed. R. Civ. P. 5(b), I certify that on the February 28, 2012, I served

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CAESARS WORLD, INC.’S EMERGENCY MOTION TO COMPEL AND FOR

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SANCTIONS as follows:

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Parties
Represented

Attorneys of Record

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Michael W. Sanft, Esq.
Sanft Law Group
520 South Fourth St.
Suite 320
Las Vegas, Nevada 89101

Method of Service

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■
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Personal Service
Email/E-File
Fax Service
Mail Service

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DATED this 28th day of February, 2012.

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/s/ Nadya Munasifi Sand
Nadya Munasifi Sand

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