Brooks v. Macy's, Inc.

Filing 23

MEMORANDUM OPINION AND ORDER: For all of the reasons listed in this Memorandum Opinion and Order, defendant's application for a stay of discovery is granted to the extent defendant seeks to stay deposition discovery; it is denied in all other respects. (Signed by Magistrate Judge Henry B. Pitman on 12/21/10) Copies Transmitted By Chambers. (mro)

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK -----------------------------------X JOSEPH E. BROOKS, Plaintiff, -againstMACY'S, INC. Defendant. : : : : : 10 Civ. 5304 (BSJ)(HBP) MEMORANDUM OPINION AND ORDER

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PITMAN, United States Magistrate Judge:

Defendant moves to stay discovery pending both the resolution of its motion for judgment on the pleadings and the issuance of a decision by the plan administrator on plaintiff's claims. For the reasons set forth below, the application is

granted in part and denied in part. This is an ERISA action in which plaintiff alleges that the medical benefits to which he is entitled under his retirement plan have been improperly restricted. Plaintiff, who is 82 years

old, was formerly the Chairman and Chief Executive Officer of Lord & Taylor (Complaint, dated July 12, 2010 (Docket Item 1) ("Compl."), ¶ 1). He alleges that since his retirement in 1986,

he and his wife have received extensive benefits under the plan, including reimbursement for health maintenance expenses such as gym memberships and personal trainers (Compl. ¶¶ 1, 29). Plain-

tiff alleges that all of these expenses were reimbursed without question through the end of 2009 (Compl. ¶ 1). In late 2009, after several mergers, plaintiff alleges that the successor to Lord & Taylor, Macy's, began to limit the scope of his benefits under the plan. According to plaintiff,

"Macy's . . . departed from its long standing practice of reimbursing Mr. and Mrs. Brooks for the full cost of their medical and ancillary needs and notified Mr. and Mrs. Brooks that reimbursement of future claims would be judged under different, and much more stringent, standards . . ." (Compl. ¶ 2). Plaintiff commenced this action on July 13, 2010 and served defendant two days later (Docket Item 2). Defendant

answered the complaint on September 3, 2010 (Docket Item 8), and, as far as the record discloses, first raised the issue of a stay at a pretrial conference held on November 15, 2010. At the

conference, I directed the parties to submit letter briefs addressing the propriety of a stay. The parties completed their Also on

submissions concerning this issue on December 7, 2010.

December 7, 2010, defendant moved (1) to remand count I of the complaint to the plan administrator for further proceedings and (2) for judgment on the pleadings with respect to counts II - V (Docket Item 19). The principal basis on which defendant seeks

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to stay discovery is that discovery will not be necessary if its motion seeking remand and partial dismissal is granted. Except in cases covered by the Private Securities Litigation Reform Act, a motion to dismiss does not automatically stay discovery. In re WRT Energy Sec. Litig., 96 Civ. 3610

(JFK), 96 Civ. 3611 (JFK), 1996 WL 580930 at *1 (S.D.N.Y. Oct. 9, 1996) (Keenan, D.J.); see Integrated Sys. & Power, Inc. v. Honeywell Int'l, Inc., 09 Civ. 5874 (RPP), 2009 WL 2777076 at *1 (S.D.N.Y. Sept. 1, 2009) (Patterson, D.J.) ("It is well-settled that the issuance of a stay of discovery pending the outcome of a motion to dismiss is by no means automatic." (inner quotations omitted)); Spencer Trask Software & Info. Servs., LLC v. RPost Int'l Ltd., 206 F.R.D. 367, 368 (S.D.N.Y. 2002) (Leisure, D.J.); Moran v. Flaherty, 92 Civ. 3200 (PKL), 1992 WL 276913 at *1 (S.D.N.Y. Sept. 25, 1992) (Leisure, D.J.); see also Collier v. Aksys Ltd., 179 F. App'x 770, 771 (2d Cir. 2006). A motion to

dismiss may, however, provide "good cause" for a protective order pursuant to Fed.R.Civ.P. 26(c) staying discovery. As explained

by the Honorable Peter K. Leisure, United States District Judge, in Niv v. Hilton Hotels Corp., 06 Civ. 7839 (PKL), 2007 WL 510113 at *1 (S.D.N.Y. Feb. 15, 2007): Good cause may be shown where a party has filed, or has sought leave to file, a dispositive motion, the stay is for a short period of time, and the opposing party will 3

not be prejudiced by the order. See Spencer Trask Software & Information Services, LLC v. RPost Intern. Ltd., 206 F.R.D. 367, 368 (S.D.N.Y.