DiLuzio v. The Village of Yorkville, Ohio et al

Filing 350

OPINION AND ORDER adopting and affirming 326 Report and Recommendations; granting 241 Plaintiff's Motion for Sanctions and it is ORDERED that default judgment be entered as to all Defendants, with exception to Police Chief Morelli; denying [ 334] Motion for Reconsideration; denying 348 Motion to Re-Open Discovery; denying 349 Motion for Leave to Supplement the Reply. Defendants and their counsel are ORDERED to pay jointly and severally the reasonable expenses, including attorney's fees, incurred in connection with Plaintiff's Motion for Sanctions. Plaintiff is ORDERED to file an itemized list of such expenses and fees no later than 3/31/2017. Signed by Judge Michael H. Watson on 2/28/2017. (er)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
EASTERN DIVISION
Angelo L. DiLuzio,
Plaintiff,

Case No. 2:11–cv–1102

v.

Judge Michael H. Watson
Magistrate Judge Jolson

Village of Yorkville, Ohio, et al.,
Defendants.

OPINION AND ORDER
After five long years, this atypical case appeared to have reached its
denouement when the assigned United States Magistrate Judge issued a highly
detailed eighty-page Report and Recommendation (“R&R”) recommending that
the severe sanction of default judgment on liability be entered as to all
Defendants but one.1 At long last, this matter would proceed to an orderly
resolution one way or the other. But, as outlined below, Defendants’ actions
since the R&R’s issuance have been far from ordinary. Because those actions
need to be stopped, this Court issues this Opinion and Order forthwith.
I.

Relevant Procedural History

In a December 22, 2016 R&R, the Magistrate Judge found that Defendants
stymied what is supposed to be an open discovery process, resisting Plaintiff’s

1

Plaintiff did not seek, and the R&R did not recommend, sanctions against Defendant
Police Chief Morelli.

and the Court’s repeated efforts to obtain discovery on critical issues. R&R 78–
79, ECF No. 334. The Magistrate Judge found that Defendants’ conduct
included destroying or losing documents, withholding or unreasonably delaying
productions, and fabricating evidence. Id. Thus, the Magistrate Judge
recommended default judgment on liability. Id. at 79. In addition, the Magistrate
Judge ordered that Defendants and their counsel to pay jointly and severally the
reasonable expenses, including attorney’s fees, incurred in connection with
Plaintiff’s Motion for Sanctions. Id.
Although Defendants moved for reconsideration predictably, ECF No. 334,
their actions thereafter could not have been predicted. Despite supplemental
discovery having been closed for some seven months, Defendants took it upon
themselves to reopen that process, seeking to obtain documents in an alleged
effort to right the wrongs addressed in the R&R. In their counsel’s words, they
sought to “eliminate . . . the prejudice [Plaintiff has] suffered as a consequence of
the failure to produce” evidence. Transcript 5–6, ECF No. 347. In response to
this unusual turn of events, Plaintiff filed a motion, ECF No. 341, and the
Magistrate Judge held a conference on the record. Transcript, ECF No. 347.
That conference occurred at 8:00 a.m. on February 23, 2017. Order, ECF
No. 344. Defendants’ counsel acknowledged that discovery was closed and
sought “retroactive[ ]” permission for discovery that might cure Plaintiff’s
prejudice. Id. at 6. During the conference and in an Order following the
conference, the Magistrate Judge made clear that “no discovery is permitted at
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this juncture,” and the parties were prohibited from engaging in any discovery
“without first obtaining leave of Court.” Id at 1.
The very same day, at 4:47 p.m., Defendants filed their Reply in support of
their Motion for Reconsideration. Reply, ECF No. 345. In addition to making a
number of new arguments, Defendants acted in defiance of the Magistrate
Judge’s Order by relying on the discovery their counsel engaged in unilaterally
long after the deadline without leave of Court. Id. at 10. To that end, Defendants
attached three new affidavits they claim support their positions concerning the
new discovery. Id.; Reply Exh. 1–3, ECF Nos. 345-1, 345-2, 345-3.
The following day, on February 24, 2017, although Defendants filed a
Notice that they had withdrawn the subpoenas, ECF No. 346, they filed a Motion
to Re-Open Discovery to “reconstruct” evidence the Magistrate Judge had
determined was lost or destroyed, Reply, ECF No. 348, and a Motion for Leave
to File a Supplement to their Reply related to the unilateral discovery they
conducted, ECF No. 349. In the plainest of terms, Defendants are seeking a “do
over.” They acknowledge improper conduct—even explaining that Defendants’
former counsel “lost his position as an equity shareholder in the firm where he
worked for twenty-five years” related to the discovery in this case, ECF No. 345
at 24, n.4. Yet, they allege new counsel within the same firm should be able to
rewind this case because then, they claim, all will be remedied with the Court and
Plaintiff. It is that precise approach, acting with impunity, that prompted the

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Magistrate Judge’s R&R. Put simply, the rules that govern practice and equal
justice for all in this Court allow no do over here.
Naturally, Plaintiff’s counsel called the Court to inform it that he would be
filing responses to the pending Motions.
II.

Discussion

Far from needing Plaintiff’s responses, this Court is prepared to act without
delay by finding in Plaintiff’s favor. The behavior of Defendants and their counsel
has gone on long enough, and it ends today. Stated simply, this Court has
inherent power to manage its own docket, and it will not allow Defendants to
derail this action any further.
When a party timely objects to a report and recommendation, the
reviewing District Judge “shall make a de novo determination of those portions of
the report or specified proposed findings or recommendations to which objection
is made.” 28 U.S.C. § 636(b)(1). See also Fed. R. Civ. P. 72(b)(3) (“The district
judge must determine de novo any part of the magistrate judge’s disposition that
has been properly objected to”). The reviewing District Judge “may accept,
reject, or modify, in whole or in part, the findings or recommendations made by
the magistrate judge.” 28 U.S.C. § 636(b)(1).
In the eighty-page R&R, the Magistrate Judge carefully detailed the factual
allegations, claims, and procedural history in this case. In doing so, she
specifically described “Defendants’ repeated and concerted efforts to avoid
discovery includ[ing], but [ ] not limited to, fabrication, untruthful and evasive
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testimony, ‘missing’ and destroyed documents, unjustified delay, and baseless
objections.” R&R 51, ECF No. 326. The Magistrate Judge concluded that these
discovery abuses prejudiced Plaintiff, that Defendants were sufficiently warned
that their failure to cooperate in discovery could lead to default judgment, and
that sanctions less drastic than default judgment could not remedy Plaintiff’s
prejudice. Id. at 60–66.
This Court agrees. While Defendants assert a number of objections to the
Magistrate Judge’s conclusions, the Court concludes that the record amply
supports the Magistrate Judge’s findings. The well-reasoned R&R reviewed the
record thoroughly, analyzed the applicable law accurately, and recommended
appropriate sanctions in accordance with the law and specific facts in this case.
Accordingly, the R&R is ADOPTED and AFFIRMED. To the extent they warrant
any mention, Defendants’ arguments are addressed briefly as follows.
A. Bad Faith and Procedural Propriety
Defendants argue that while they may have made mistakes in discovery,
they did not act in bad faith. The Court finds this argument wholly unpersuasive
for the reasons detailed by the Magistrate Judge, see R&R 51–60, ECF No. 326,
which the Court adopts and incorporates herein.
Defendants also contend that the R&R is “procedurally improper” because
it improperly imputes certain wrongdoing against Mayor DeFilippo, who is now
deceased, and former Fire Chief Klubert. The Court disagrees. As Plaintiff
points out, Resp. 50, ECF No. 340, the discovery requests were directed to all
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Defendants as were the Court’s orders regarding discovery. Moreover, counsel
for Defendants, acting on behalf of Mayor DeFilipppo and Fire Chief Klubert, and
Mayor Closser, chosen by Defendants as their representative, personally
participated in discovery abuses and violated discovery orders. For these
reasons, the Court finds that the R&R properly recommended sanctions against
Mayor DeFilipppo and Fire Chief Klubert.
B. Adequate Warning and Prejudice
Defendants further complain that they were not “sufficiently warned” that
their discovery abuses could lead to sanctions and were not provided an
opportunity to cure their failures. This argument is disingenuous and directly
contradicts the extensive discovery conferences, hearings, and orders in this
case. See R&R 62–63, ECF No. 326.
Defendants further insist that their behavior in discovery did not prejudice
Plaintiff, contending that any missing evidence relates to a non-party witness and
is irrelevant to the elements of Plaintiff’s claims. The Court disagrees. The
records reflecting who transported Plaintiff to the hospital on the night of the fire,
i.e., the “run sheets,” may have shown that Plaintiff “was unnecessarily removed
from the scene and that Fire Chief Klubert’s judgment was impaired the night of
the fire due to his intoxication.” R&R 61, ECF No. 326. While Defendants argue
at length that the missing or destroyed records of the Back Room Club involving
Valerie Klubert’s embezzlement relate to an ancillary issue, “[c]redibility means
everything in” this case. R&R 65, ECF No. 326 (detailing the importance of Ms.
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Klubert’s credibility and the interplay between her and Defendants). Cf. 6th Cir.
Opin. 2, ECF No. 168 (summarizing the factual background and noting, inter alia,
that Plaintiff’s buildings “caught fire under suspicious circumstances” and that
Fire Chief Klubert and Mayor DeFilippo decided “to demolish a portion of one of
the burned buildings immediately, without any inspection or formal decision on
the need for demolition”).
C. Belated, Unauthorized Efforts to “Cure” the Prejudice
Notably, Defendants’ current attempts to “cure” this prejudice belie their
insistence that the prejudice is non-existent or minimal and further underscore
the continued course of improper conduct in discovery. Defendants’ issuance of
the subpoena is wholly inappropriate and directly contrary to the Court’s orders.
Notwithstanding defense counsel’s representations at the conference on
February 23, 2017, and his purported withdrawal of the subpoenas and return of
the records, Defendants continue to rely on this improper behavior in objecting to
the R&R. Permitting Defendants to conduct discovery they previously should
have conducted simply rewards Defendants for their repeated discovery abuses.
For these reasons, Defendants’ reliance on their current discovery efforts in their
Reply is unpersuasive.
D. Attorney’s Fees and Costs
Finally, Defendants contend that an award of attorney’s fees and costs is
not justified here. However, because Defendants acted in bad faith for the
reasons discussed supra and articulated in the R&R, an award of attorney’s fees
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and costs, jointly and severally against Defendants and their counsel, is
appropriate.
Defendants and their counsel are ORDERED to pay jointly and severally
the reasonable expenses, including attorney’s fees, incurred in connection with
Plaintiff’s Motion for Sanctions, ECF No. 241. Plaintiff is ORDERED to file an
itemized list of such expenses and fees no later than March 31, 2017.
Defendants’ response is due within twenty-one days after the filing of Plaintiff’s
fees and expenses. Plaintiff may reply within fourteen days after the filing of
Defendants’ response.
E. Oral Argument
For the first time in their Reply, Defendants request oral argument. Reply
1, 25, ECF No. 345. This Court’s Local Rules provide that the Undersigned may
grant oral argument “if oral argument is deemed to be essential to the fair
resolution of the case because of its public importance or the complexity of the
factual or legal issues presented[.]” S.D. Ohio Civ. R. 7.1(b)(2). It is within this
Court’s discretion to grant or deny a request for oral argument. Gruenbaum v.
Werner Enter., Inc., No. 09–cv–1041, 2011 WL 563912, at *2 (S.D. Ohio Feb. 2,
2011). Having reviewed the R&R, objections, and related briefing, the Court
concludes oral argument will not be helpful and is not essential to the fair
resolution of the case. Defendants’ request for oral argument is therefore
DENIED.

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III.

Conclusion

For the reasons set forth above, the R&R is ADOPTED and AFFIRMED.
Accordingly, Plaintiff’s Motion for Sanctions, ECF No. 241, is GRANTED, and it is
ORDERED that default judgment be entered as to all Defendants, with the
exception of Police Chief Morelli. Therefore, the Motion for Reconsideration,
ECF No. 334, the Motion to Re-Open Discovery, ECF No. 348, and the Motion
for Leave to Supplement the Reply, ECF No. 349, are DENIED.
Further, Defendants and their counsel are ORDERED to pay jointly and
severally the reasonable expenses, including attorney’s fees, incurred in
connection with Plaintiff’s Motion for Sanctions, ECF No. 241. Plaintiff is
ORDERED to file an itemized list of such expenses and fees no later than March
31, 2017. Defendants’ response is due within twenty-one days after the filing of
Plaintiff’s fees and expenses. Plaintiff may reply within fourteen days after the
filing of Defendants’ response.
At the upcoming STATUS CONFERENCE on March 8, 2017, at 2:00
p.m., this Court shall set a trial date for Police Chief Morelli on liability, a trial date
for the Village Defendants on damages, and a hearing date for attorney’s fees.
Counsel shall be prepared to address which of the multiple pending motions are
now moot based on the procedural posture.
The Clerk is DIRECTED to terminate ECF Nos. 241, 326, 334, 348, and
349 from the Court’s pending motions list.

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IT IS SO ORDERED.
s/Michael H. Watson________________
MICHAEL H. WATSON, JUDGE
UNITED STATES DISTRICT COURT

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