Babadzhanova v. Merck & Co., Inc.

Filing 10

MEMORANDUM OPINION AND ORDER re: 7 MOTION to Dismiss with Prejudice for Failure to Provide Plaintiff Profile Form filed by Merck & Co., Inc. For these reasons, Plaintiff's case is dismissed with prejudice pursuant to Rule 37(b). (Signed by Judge John F. Keenan on 3/21/2013) (lmb)

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Case 1:09-md-02013-PAC Document 57 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK UNITED STATES DISTRICT COURT --------------------------------------SOUTHERN DISTRICT OF NEW YORK IN RE: -----------------------------------------------------------x FOSAMAX PRODUCTS LIABILITY LITIGATION In re FANNIE MAE 2008 SECURITIES : --------------------------------------LITIGATION relates to: : This document : Lyudmila Babadzhanova v. : Merck & Co., Inc., -----------------------------------------------------------x No. 08 Civ. 3206 (JFK) --------------------------------------- Filed 09/30/10 Page 1 of 45 USDC SDNY DOCUMENT ELECTRONICALLY FILED DOC #: _________________ DATE FILED: Mar. 21, 2013 X : : : : : : : X Master File No. 08 MD 1789 (JFK) 06 Civ. 7831 (PAC) 09 MD 2013 (PAC) MEMORANDUM OPINION OPINION & ORDER AND ORDER JOHN F. KEENAN, United States District Judge: HONORABLE PAUL A. CROTTY, United States District Judge: Defendant Merck Sharp & Dohme Corp. (“Merck”) moves BACKGROUND1 pursuant to Federal Rules of Civil Procedure 16(f), 37(b), and The early this case with a boom in home financing which was fueled, among 41(b) to dismissyears of this decade sawprejudice because plaintiff other Babadzhanova (“Plaintiff”) conditions. New lending instruments, such as Lyudmila things, by low interest rates and lax credit has failed to provide a Plaintiff Profile Form credit risk loans) and Alt-A mortgages (low-documentation loans) subprime mortgages (high (“PPF”) as required by Case Management Order No. boom going. Borrowers played a role too;not took on unmanageable risks on the kept the 3 (“CMO 3”). Plaintiff has they opposed the motion. For the reasons the market would continue to rise and thatis granted. assumption that provided below, the motion refinancing options would always be I. Background available in the future. Lending discipline was lacking in the system. Mortgage originators did notSection high-risk mortgage loans. Rather than carry the rising risk oncases hold these 10.3 of CMO 3 requires plaintiffs in all their books, the consolidatedsold their loans into the secondary mortgage market, (“MDL”) to submit originators in this multi-district litigation often as securitized packages completed as mortgage-backed securities (“MBSs”). MBSsixty days almost exponentially. known PPFs to defense counsel within markets grew of the date that the case is filed with this Court the demand cases transferred But then the housing bubble burst. In 2006, or, for for housing dropped abruptly here, the date that to fall.conditional transfer order becomes and home prices began the In light of the changing housing market, banks modified their final. CMO 3 further provides that Merck may send without refinancing. lending practices and became unwilling to refinance home mortgages a deficiency letter to a plaintiff who has not submitted a completed PPF 1 within sixty days. Upon receipt of _)” or to deficiency letter, the Unless otherwise indicated, all references cited as “(¶ the the “Complaint” are to the Amended Complaint, dated June 22, 2009. For purposes of this Motion, all allegations in the Amended Complaint are taken as true. plaintiff has thirty days to cure the deficiency. 1 If the plaintiff fails to provide a PPF within the provided cure period, CMO 3 permits the “defendants to move for sanctions, including without limitation, attorneys fees, dismissal without prejudice, or dismissal with prejudice.” Plaintiff filed her case on March 31, 2008. In a letter dated April 7, 2008, Merck reminded Plaintiff of her obligation to provide a completed PPF by May 30, 2008. (Mayer Decl. Exh. 1.) When Plaintiff failed to provide a PPF by this deadline, Merck sent a deficiency letter to Plaintiff explaining that she had thirty days to cure the deficiency and produce the PPF. (Mayer Decl. Ex. 2.) Plaintiff did not respond. Nonetheless, on July 8, 2008, Merck sent Plaintiff another letter offering fifteen more days to produce the PPF. (Mayer Dec. Exh. 3.) Plaintiff finally provided a partially completed PPF on August 5, 2008. Merck sent Plaintiff a nine-page letter on August 6, 2008, detailing the host of omissions in the PPF, including, among other things, relevant dates, medical history, documents, and dental background. (Mayer Decl. Exh. 4.) Plaintiff never responded, and on October 24, 2008, Merck wrote another letter requesting a response to the deficiency letter (Mayer Decl. Exh. 5.) Upon hearing nothing from Plaintiff, Merck sent a final letter on November 12, 2008 urging 2 compliance. (Mayer Decl. Exh. 6.) To date, Plaintiff still has not provided a completed PPF. On February 11, 2013, Merck filed this motion to dismiss the case with prejudice in light of Plaintiff’s noncompliance with CMO 3. Plaintiff has not opposed the motion nor offered to provide a completed PPF. II. Discussion Rule 37(b) governs the instant motion. Societe Internationale Pour Participations Industrielles Et Commerciales, S. A. v. Rogers, 357 U.S. 197, 207 (1958). The rule provides that a district court may impose sanctions “as are just” upon a party who fails to obey a discovery order. Fed. R. Civ. P. 37(b)(2). The court has discretion to impose a sanction of dismissal only if the failure to comply resulted from “willfulness, bad faith, or any fault.” Societe Internationale, 357 U.S. at 207; Shcherbakovskiy v. Da Capo Al Fine, Ltd., 490 F.3d. 130 (2d Cir. 2007). A court may determine that dismissal with prejudice is an appropriate penalty upon consideration of the following factors: “(1) the willfulness of the noncompliant party or the reason for the noncompliance; (2) the efficacy of lesser sanctions; (3) the duration of the period of noncompliance; and (4) whether the noncompliant party had been warned of the consequences of his noncompliance.” Davidson v. 3 Dean, 204 F.R.D. 251, 255 (S.D.N.Y. 2001) (citing Bambu Sales, Inc. v. Ozak Trading Inc., 58 F.3d 849, 852-54 (2d Cir. 1995)). Here, Plaintiff’s disobedience was undoubtedly willful. “Noncompliance with discovery orders is considered willful when the court’s orders have been clear, when the party has understood them, and when the party’s noncompliance is not due to factors beyond the party’s control.” Davis v. Artuz, No. 96 Civ. 7699 (GBD), 2001 WL 50887, at *3 (S.D.N.Y. Jan. 19, 2001) (citing Baba v. Japan Travel Bureau, Int’l, Inc., 165 F.R.D. 398, 402-03 (S.D.N.Y. 1996), aff’d, 111 F.3d 2 (2d Cir. 1997)). CMO 3 clearly states that every plaintiff in this MDL must provide defendant with a completed PPF. There can be no doubt that Plaintiff understood this obligation. Merck sent several letters and emails reminding her counsel of it. Despite this, Plaintiff disregarded her discovery obligations under CMO 3, ignored repeated letters from defendant urging her to comply and extending the deadlines, and failed to respond to this motion to dismiss. Plaintiff has not claimed that her noncompliance was caused by forces beyond her control. Indeed, she has not made any claims at all with respect to her failure to supply a PPF. Turning to the other relevant factors, Plaintiff has not offered an excuse for her noncompliance, nor has she expressed a willingness to provide a PPF at a future time. 4 Next, a sanction short of dismissal is unlikely to induce Plaintiff's compliance, given that she has not offered to provide a PPF even in response to this motion to dismiss. Moreover, Plaintiff's noncompliance with CMO 3 has lasted for more than four years. Her failure to respond to this motion to dismiss indicates that she no longer is interested in prosecuting her claims and likely will never provide a PPF. Finally, CMO 3 clearly warned Plaintiff that the ilure to provide a completed PPF on time could result in dismissal of her case. She received further warnings from Merck that her case would be dismissed if she failed to comply. For these reasons, Plaintiff's case is dismissed with prejudice pursuant to Rule 37(b). SO ORDERED. Dated: New York, New York March:2 /, 2013 John F. Keenan United States District Judge 5

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