Certain Interested Underwriters Subscribing to Policy No. B1262PW00017013 v. American Realty Advisors, et al

Filing 167

ORDER denying 97 Motion to Compel ARA Parties' Motion to Compel and for Award of Expenses. Signed by Magistrate Judge James E. Gates on 9/29/2018. (Collins, S.)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NORTH CAROLINA
WESTERN DIVISION
CERTAIN INTERESTED
UNDERWRITERS SUBSCRIBING TO
POLICY NO. B1262PW0017013,
Plaintiffs,
v.
AMERICAN REALTY ADVISORS; SVF
WESTON LAKESIDE, LLC; and DOES 125, Inclusive,
Defendants.
____________________________________
SVF WESTON LAKESIDE, LLC; and
AMERICAN REALTY ADVISORS,
Plaintiffs,
v.
CERTAIN UNDERWRITERS AT
LLOYD’S OF LONDON,
Defendants.
____________________________________

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No. 5:16-CV-940-FL

No. 5:17-CV-74-FL

These consolidated cases come before the court on the motion to compel (D.E. 97) by
defendants American Realty Advisors and SVF Weston Lakeside, LLC (the “ARA parties”),
pursuant to Rule 37(a)(3)(B)(i), (4), and (5). 1 The motion seeks an order requiring nonparty
McLarens Global Claims Services (“McLarens”) to appear for a second Rule 30(b)(6) deposition.
The ARA parties base their motion on the alleged failure by McLarens’ designee at the initial

1

This and all other rule citations herein are to the Federal Rules of Civil Procedure.

deposition to be adequately prepared. The motion is opposed by plaintiffs Certain Interested
Underwriters Subscribing to Policy No. B1262PW0017013 (“Underwriters”).
The deposition of McLarens was held pursuant to a subpoena issued to it by the ARA
parties from this court. See Subpoena (D.E. 98-2 at pp. 2-7). 2 Although the subpoena specified a
location in California as the site for the deposition (Subpoena 2), it was held in the Southern
District of New York (“SDNY”) (see Dep. Tr. (D.E. 98-3) 3 (indicating New York City as the
location of the deposition)).
Rule 37(a)(2) provides that “[a] motion for an order [compelling discovery] to a nonparty
must be made in the court where the discovery is or will be taken.” Fed. R. Civ. P. 37(a)(2); cf.
id. 45(d)(2)(B) (providing that motions to compel production or permit inspection in response to
written objections to a subpoena must be filed in the district where compliance is required);
45(d)(3) (same re motions to quash or modify a subpoena); 45(e)(2)(B) (same re motions to
determine claim of privilege or work-product protection as to information produced pursuant to a
subpoena). This provision requires that the ARA parties’ motion be filed in the SDNY.
However, the ARA parties contend, without objection by Underwriters, that this court can
properly hear their motion pursuant to Rule 45(f). It provides that “[w]hen the court where
compliance is required did not issue the subpoena, it may transfer a motion under this rule to the
issuing court if the person subject to the subpoena consents or if the court finds exceptional
circumstances.” Fed. R. Civ. P. 45(f). The ARA parties state that “[i]n accordance with Federal
Civil Rule 45(f), all parties have consented to this Motion being heard by this Court,
notwithstanding that the deposition giving rise to this Motion was conducted in the [SDNY].”
Mot. 2.

2

All citations to the record are to page numbers assigned by the court’s CM/ECF electronic file management system.

2

The contention that Rule 45(f) authorizes this court, in lieu of the SDNY, to hear the ARA
parties’ motion is unconvincing. Assuming the ARA parties’ motion is one under Rule 45, by the
plain terms of subdivision (f), the consent of the person subject to the subpoena does not obviate
transfer by the court where compliance is required, but simply constitutes a ground upon which
that court “may” transfer a motion. Fed. R. Civ. P. 45(f).
Further, it is not entirely clear that McLarens even consents to transfer. The ARA parties
state in their motion that “all parties” have consented to this court hearing the motion. McLarens
is, of course, a nonparty. Mot. 2.
In addition, while McLarens was purportedly represented at the deposition by
Underwriters’ counsel, along with its own counsel (see ARA Parties’ Mem. (D.E. 98) 3;
Underwriters’ Mem. (108) 4), none of the certificates of service with the filings on the motion
show service on McLarens itself or any attorney identifying himself as counsel for McLarens (see
Mot. 3; ARA Parties’ Mem. 10; Underwriters’ Mem. 11; Hayek Dec. (D.E. 109) 4). No attorney
has filed a notice of appearance on behalf of McLarens. The record therefore does not definitively
show that McLarens even has proper notice of the motion. 3 Any such lack of consent or due notice
is significant since under Rule 45(f) “[t]he prime concern should be avoiding burdens on local
nonparties subject to subpoenas.” Fed. R. Civ. P. 45, advisory comm. notes, 2013 amend., subdiv.
(f). Given this “prime concern,” the fact that the ARA parties and Underwriters consent to this
court hearing the ARA parties’ motion is of less significance under Rule 45(f). Id.
The court concludes that the ARA parties’ motion is not properly before it. The motion is
therefore DENIED without prejudice.

3

There is no question that the memorandum in opposition to the motion was not filed on behalf of McLarens. It is
expressly on behalf of Underwriters and is signed by attorneys identifying themselves as counsel for Underwriters.
See Underwriters’ Mem. 1, 4 (“As Underwriters defended [McLarens’] deposition, they properly oppose the instant
motion.”), 10.

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SO ORDERED, this 29th day of September 2018.

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